M/S Aastha Enviro Engineers PVT. LTD., Lko. Thru. Director Chandra Bhan Singh vs. Union Of INDIA, New Delhi Thru. Secy. Ministry Of Finance And Others
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The petitioner, M/s Aastha Enviro Engineers Pvt. Ltd., a private company registered under GST on July 1, 2017, filed a writ petition challenging the order dated September 6, 2022, passed by the Assistant Commissioner, State Tax, Lucknow, cancelling its GST registration. The cancellation was based on the petitioner's failure to file returns for six months, from February 2022 to July 2022. The petitioner's subsequent appeal against this order was dismissed by the Additional Commissioner, Grade-II (Appeal) on February 20, 2023. It is not disputed that the petitioner has since filed the pending returns and deposited the requisite tax, along with penalty and interest, and is now filing returns up to date.
Held
The Court held that the cancellation of GST registration was based solely on the petitioner's failure to file returns for the period February 2022 to July 2022. It was not disputed that the petitioner has since filed all these returns, deposited the tax, penalty, and interest, and is now filing returns up to date. The Court found that the very basis for cancellation, i.e., non-filing of returns, no longer existed. Therefore, the matter warranted reconsideration by the Assistant Commissioner. The Court quashed the impugned orders dated September 6, 2022, and February 20, 2023, and remanded the case to the Assistant Commissioner, State Tax, Lucknow, for reconsideration of the cancellation of GST registration within one month from the date of production of a certified copy of the order. The ratio decidendi is that if a taxpayer rectifies the default that led to the cancellation of registration by filing pending returns and paying dues, the cancellation order should be reconsidered.
Key Issues
1. Whether the cancellation of GST registration is justified when the petitioner has subsequently filed all pending returns and deposited the tax, penalty, and interest, and is now compliant with filing requirements? The petitioner argued that the sole ground for cancellation was non-filing of returns for a specific period. However, this issue has been rectified by filing all pending returns and depositing the due tax, penalty, and interest. The petitioner contended that in light of this subsequent compliance, the cancellation order has become unsustainable and the matter should be reconsidered. The respondent revenue authority did not record any specific arguments in the judgment, but their action of cancelling the registration was based on the petitioner's non-compliance with filing obligations.
Sections Cited
Section 29
AI-generated summary — verify with the full judgment below
Court No. - 17 Case :- WRIT TAX No. - 57 of 2023 Petitioner :- M/S Aastha Enviro Engineers Pvt. Ltd., Lko. Thru. Director Chandra Bhan Singh Respondent :- Union Of India, New Delhi Thru. Secy. Ministry Of Finance And Others Counsel for Petitioner :- Sanjieva Shankhdhar,Durga Prasad Dubey Counsel for Respondent :- A.S.G.I.,C.S.C. Hon'ble Dinesh Kumar Singh,J.
Heard Sri Sanjieva Shankhdhar, learned counsel for the petitioner and Sri Sanjay Sarin, learned Additional Chief Standing Counsel and perused the record.
The present petition under Article 226 of the Constitution of India has been filed seeking quashing of the orders dated 6.9.2022 passed by the Assistant Commissioner, State Tax, Sector-9, Lucknow (B), Lucknow cancelling the GST registration of the petitioner and the appellate order dated 20.2.2023 passed by the Additional Commissioner, Grade-II (Appeal) State Tax, Judicial Division-III, Lucknow.
The petitioner is a private company incorporated under the Companies Act, which carries the work of civil contract for water and waste water treatment. The petitioner got registered itself under the provisions of the G.S.T. Act, 2017 on 1.7.2017. It appears that the petitioner did not file its returns for the past six months i.e. from February, 2022 to July, 2022 and, therefore, the impugned order cancelling the GST registration was passed. Against the said order, the petitioner filed an appeal, which too was dismissed.
It is not in dispute that the petitioner has filed returns for the said period and upto date and has deposited the tax including the penalty and interest. The impugned order would disclose that the order was passed only on the ground that the petitioner has not filed his returns for the said period as mentioned above. Now, since the returns have been filed, which have been accepted with penalty and interest and the petitioner has filed returns upto date, I find that the matter may be remanded back to the Assistant Commissioner, State Tax, Sector-9, Lucknow (B), Lucknow to reconsider the matter regarding cancellation of the GST registration of the petitioner in view of the fact that the petitioner has now filed the returns upto date and has deposited the tax with penalty and interest and the very fact of the cancellation of the GST registration of the petitioner does not exist.
In view of the above, the present petition is allowed and the impugned orders dated 6.9.2022 passed by the Assistant Commissioner, State Tax, Sector-9, Lucknow (B), Lucknow and the appellate order dated 20.2.2023 passed by the Additional Commissioner, Grade-II (Appeal) State Tax, Judicial Division- III, Lucknow, are hereby quashed. The matter is remanded to the office of the Assistant Commissioner, State Tax, Sector-9, Lucknow (B), Lucknow for reconsideration regarding cancellation of the GST registration of the petitioner. Such consideration should be given within a period of one month from the date of production of a certified copy of this order before him. Order Date :- 24.3.2023 Rao/- CHEBROLU SRINIVASA RAO High Court of Judicature at Allahabad, Lucknow Bench
Reproduced from the public record of the Allahabad High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.