Dharmaraj Murugavel vs. The Assistant Commissioner (Circle)

Held

The Court held that the Petitioner's GSTN registration cancellation should be revoked, subject to specific conditions, following the precedent set in Tvl.Suguna Cutpiece Vs The Appellate Deputy Commissioner (ST) (GST) and others. The Court directed the Petitioner to file all pending returns for the period prior to cancellation, along with the defaulted tax, interest, and any applicable fine or fee, within 45 days of receiving a copy of the order. It was clarified that these payments could not be made from Input Tax Credit (ITC). Any unutilized ITC would require scrutiny and approval by a competent officer before being used for future liabilities. The Petitioner was also required to pay GST and file returns for the period subsequent to cancellation in cash. The registration would stand revived upon payment of tax, penalty, and uploading of returns. The Respondent was directed to take steps to enable the Petitioner to file returns and pay dues on the GST portal within 30 days.

Facts

The Petitioner, Dharmaraj Murugavel, filed a writ petition challenging the order dated 28.04.2022 passed by the Respondent, The Assistant Commissioner (Circle), Dindigul, cancelling his GSTN Registration No.33BRLPM8009C1ZY. The cancellation was based on the Petitioner's failure to file Goods and Services Tax monthly returns for a continuous period of six months, as per Section 29 of the Central Goods and Services Tax Act, 2017. The Petitioner submitted that non-filing was due to health issues and that he could not file an application for revocation within the prescribed time after receiving a show cause notice dated 25.03.2022.

Key Issues

1. Whether the cancellation of the Petitioner's GSTN registration is liable to be quashed due to non-filing of returns for six months, considering the Petitioner's submission of health issues and inability to file a timely revocation application? (Question of law and fact, turning on Section 29 of the Central Goods and Services Tax Act, 2017 and principles of natural justice). Petitioner's Contention: The Petitioner argued that the cancellation was illegal and arbitrary, primarily due to health issues preventing timely filing of returns and subsequent revocation application. The Petitioner relied on the consistent view of this Court in similar circumstances. Respondent's Contention: The Respondent did not present any separate arguments but implicitly supported the application of the directions issued in prior judgments of this Court, as indicated by the joint submission with the Petitioner's counsel.