Pragati Bio And Renewable Energy, Through Its Proprietor Balsonari Alias Balsonari Tirkey vs. Principal Commissioner, Central Goods And Service Tax, Government Of INDIA, Ministry Of Revenue

Held

The Court held that the petitioner firm is not entitled to any relief due to delay and latches, coupled with a lethargic approach. The petitioner failed to file returns regularly and did not comply with GST REG 2017. Furthermore, the petitioner filed an appeal after a delay of 403 days, which is significantly beyond the three-month limitation period prescribed under Section 107(1) of the CGST Act, 2017. The Court found no perversity in the order of cancellation of GST registration and no necessity to interfere with the appellate order, as it was passed beyond the statutory period of limitation. Therefore, the writ petition was dismissed. No specific issue was left undecided; the Court addressed the core issues of delay, latches, and the validity of the appellate order based on limitation.

Facts

The petitioner, Pragati Bio & Renewable Energy, a proprietorship, had its GST registration cancelled effective January 15, 2023, by an order dated February 21, 2023, passed by the Superintendent, Central Goods and Service Tax. This cancellation was due to non-compliance with GST REG 2017. The petitioner did not file a reply to the show cause notice issued on January 15, 2023. Subsequently, the petitioner filed an appeal before the Additional Commissioner (Appeals) on March 28, 2024, approximately 403 days after the cancellation order. The appellate authority rejected the appeal solely on the grounds of limitation, without examining the merits of the case. The petitioner then filed a writ petition before the High Court seeking restoration of its GST registration, quashing of the cancellation order, and the appellate order.

Key Issues

1. Whether the GST registration of the petitioner, cancelled by the Superintendent, Central Goods and Service Tax, should be restored, considering the petitioner's claim of financial constraints affecting its ability to file returns and pay consultant fees, and whether the authorities should have taken a liberal approach? (Relates to principles of natural justice and administrative discretion). 2. Whether the order of cancellation of GST registration dated February 21, 2023, and the appellate order dated June 6, 2024, are liable to be quashed and set aside? Petitioner's Arguments: The petitioner argued that the cancellation of registration serves no useful purpose and that a liberal approach should have been adopted. They contended that financial constraints led to their inability to file returns, and the impugned orders should be quashed. The petitioner relied on the principle that business activities suffered drastically, leading to zero financial activities. Respondent's Arguments: The respondent argued that the petitioner failed to furnish a return under Section 39 of the CGST Act, 2017, and did not comply with GST REG 2017 within the stipulated time, leading to cancellation. They further submitted that the petitioner did not file the appeal within the prescribed time, and the appellate authority rightly dismissed it on grounds of limitation.