Prakash Singh Nagarkoti vs. State Of Uttarakhand
Facts
The petitioner, Dr. Govind Singh Latwal, challenged the cancellation of his GST registration. The core of the dispute revolves around the excisability of royalty on minerals, a matter currently pending before the Apex Court. While the Apex Court has previously held that royalty is not a tax, the Tax Authorities proceeded with the cancellation of the petitioner's GST registration without adequately considering this aspect. The petitioner sought relief from the High Court against this order.
Held
The Court acknowledged that the issue of excisability of royalty on minerals is pending before the Apex Court and that the Apex Court has previously held royalty not to be a tax. The Court opined that the Tax Authorities ought to have considered this aspect before cancelling the GST registration. Accordingly, the Court permitted the petitioner to file an application for revocation of the cancellation order under Section 30 of the Act of 2017. The Court directed that upon the petitioner depositing a sum equivalent to 20% of the tax dues within two weeks, the Authorities shall consider the revocation of the cancellation order. Furthermore, if such a deposit is made, the order freezing the bank accounts shall be stayed.
Key Issues
1. Whether the Tax Authorities erred in cancelling the petitioner's GST registration without considering the pending Apex Court decision on the excisability of royalty on minerals, which has been held not to be a tax. Petitioner's Contention: The petitioner argued that the Tax Authorities should have factored in the ongoing Apex Court proceedings and the prior pronouncement that royalty is not a tax before deciding to cancel the GST registration. The petitioner relied on the principle that tax authorities should be mindful of matters pending before the highest court. Revenue's Contention: The judgment does not record any specific arguments made by the State (Revenue) on this issue. However, their action of cancelling the registration implies a stance that such cancellation was justified.
Sections Cited
Section 30
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SL. No Date Office Notes, reports, orders or proceedings or directions and Registrar’s order with Signatures COURT’S OR JUDGES’S ORDERS
WPMB No. 395 of 2025 Hon’ble G. Narendar, C.J. Hon’ble Alok Mahra, J.
Dr. Govind Singh Latwal and Mr. Pankaj Tiwari, learned counsel for the petitioner.
Ms. Pooja Banga, learned Brief Holder for the State.
Heard learned counsel for the petitioner and learned Brief Holder for the State.
The issue regarding excisability of the royalty on the minerals is pending consideration before the Apex Court. It is, no doubt, true that the Apex Court has already held that royalty is not a tax.
Be that as it may, the issue is still seized of by the Apex Court. We are of the opinion that the Tax Authorities ought to have factored in the said aspect of the matter before considering the cancellation of the GST registration.
In that view, we permit the petitioner to file an application for revocation of cancellation order under Section 30 of the Act of 2017 and also deposit a sum equivalent to 20% of the tax dues within a period of two weeks and if such deposit is made, the Authorities shall consider re
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