Tvl. Thendral Recreation Club vs. The Commissioner Of Commercial Taxes

Held

The Court held that there is a consistent view taken in similar matters, and the revenue has not challenged such orders, which have therefore attained finality. Following the precedent set in Tvl.Suguna Cutpiece Vs Appellate Deputy Commissioner (ST) (GST) and others, and other subsequent judgments, the Court decided to extend the benefit granted in those earlier orders to the present petitioner. The impugned order of cancellation of registration was quashed. The respondents were directed to follow the same directions as laid down in paragraph 229 of the Suguna Cutpiece Centre judgment. These directions include the petitioner filing pending returns, paying defaulted tax along with interest and late fees, with the caveat that such payments cannot be made from Input Tax Credit (ITC) unless it is scrutinized and approved. Approved ITC can be used for future liabilities. The petitioner must also pay GST and file returns for periods subsequent to cancellation, with payments in cash. The registration shall stand revived forthwith upon compliance. The respondents were also directed to take steps to enable the filing of returns and payment of taxes/penalties through the GST portal. The entire exercise was to be completed within thirty days.

Facts

The petitioner, Tvl.Thendral Recreation Club, represented by its Secretary, filed a writ petition seeking to quash an order dated 21.03.2023 passed by the Commercial Tax Officer, Madurai Rural (East) Circle, cancelling its GST registration. The petitioner claimed to be unaware of the cancellation until informed by other taxpayers. Subsequently, an appeal filed before the appellate authority was rejected on the grounds of being time-barred. The petitioner argued that in similar circumstances, this Court had granted relief in batch matters, and the revenue had not challenged those orders.

Key Issues

1. Whether the cancellation of GST registration, when the petitioner claims to be unaware of the grounds for cancellation and the appeal was rejected solely on limitation, warrants interference by this Court under Article 226 of the Constitution. Petitioner's Argument: The petitioner contended that in identical situations, this Court, in the case of Tvl.Suguna Cutpiece Vs Appellate Deputy Commissioner (ST) (GST) and others (batch matters), had issued specific directions to allow for the revival of registration, subject to certain conditions. They further argued that this consistent view has been followed in subsequent judgments and has not been challenged by the revenue, thus attaining finality. Revenue's Argument: The respondent revenue authority argued that the appellate authority is bound by the prescribed limitations for filing appeals, and therefore, the rejection of the appeal beyond the period of limitation is legally sustainable.