New INDIA Biz Chem Private Limited vs. Assistant Commissioner Of State Tax

Held

The Court acknowledged the procedural difficulty faced by the petitioner in filing an online appeal due to the self-cancellation of registration, which rendered it ineligible for the online process under Section 107 of the CGST Act. The Court also noted the petitioner's reliance on Section 30 for revocation of cancellation and the provision for rectification of returns under Sections 37 and 39. The Court observed that the petitioner had filed a physical appeal and sent communications for revocation of cancellation, but these had not been addressed. The Court chose not to delve into the merits of the case, focusing instead on ensuring an expeditious response from the respondents given the time constraints. The Court directed the respondents to reply to the petitioner's communications dated 13th August 2021 and 18th August 2021 concerning the revocation of registration. Alternatively, it directed respondent no.2 to dispose of the appeal considering the timeline of 30th September 2021 to avoid issues with input tax credit utilization. If technical difficulties arose, respondent no.2 was to guide the petitioner in writing to enable online appeal filing within two weeks. The petition was disposed of with these directions, with liberty to approach the Court again in case of non-compliance.

Facts

The petitioner, New India Biz Chem Private Limited, sought restoration of its GST registration. The company, engaged in chemical manufacturing since 2002, decided to shut down its business due to the COVID-19 pandemic and transferred its leasehold rights on 3rd December 2020. Inadvertently, it applied for cancellation of its GST registration under Section 29 of the CGST Act on 3rd April 2021, and the cancellation order was issued the same day, effective from 31st March 2021. The petitioner filed NIL returns for the period it had no business. As the self-cancellation prevented online appeal filing, the petitioner filed a manual appeal under Section 107 of the CGST Act on 10th August 2021. The petitioner did not receive a personal hearing and was informed that no action could be taken until an electronic appeal was filed. The petitioner sent reminders on 13th August 2021 and 18th August 2021, which reportedly went unanswered. The petitioner also sought revocation of cancellation under Section 30 of the CGST Act.

Key Issues

1. Whether the petitioner is entitled to have its GST registration restored or its pending appeal disposed of expeditiously, considering the procedural difficulties arising from self-cancellation of registration under Section 29 of the CGST Act and the inability to file an online appeal under Section 107 of the CGST Act. The petitioner argued that due to the self-cancellation of registration, it was debarred from filing an online appeal, forcing it to file a manual appeal. It contended that the respondents failed to provide a personal hearing or reply to its communications regarding the appeal and revocation of cancellation. The petitioner relied on the decision in Bhawani Textile through Proprietor Jayesh Soni Vs. Assistant Commissioner. The petitioner also highlighted the urgency as the recipient would not be able to avail input tax credit if the returns were not rectified by 30th September 2021, despite taxes being paid. The respondents, represented by the learned AGP, did not present any specific arguments against the petitioner's claims as recorded in the judgment. The judgment notes that the respondents' representative waived service of notice.