M/S Jain Tiles Industries Supi Bhagwanpur vs. The Commissioner State Of Tax Department Of G S T

Facts

M/s Jain Tiles Industries (the petitioner) filed a writ petition challenging the cancellation of its GST registration. The cancellation order was passed on 25.09.2019, and an appeal against it was dismissed by respondent no. 3 on 18.06.2022. The writ petition was disposed of by a Single Judge on 26.08.2022, directing the petitioner to deposit Rs. 25,78,964/- within 45 days for the recall of the cancellation order and restoration of registration. Subsequently, the petitioner applied for modification of this order, which was allowed, substituting the specific amount with 'as may be determined by the Authority'. The petitioner then filed a review application, arguing that the original order incorrectly stated the reason for cancellation as non-filing of returns for 2018-19, 2019-20, and 2020-21, as the cancellation order predated the due dates for the latter two years.

Held

The Court held that while the observation in paragraph 2 of the order dated 26.08.2022 regarding the reason for cancellation might not be entirely accurate concerning the years 2019-20 and 2020-21, it did not affect the ultimate outcome of the writ petition. This was because the petitioner had admitted in their writ petition that returns for these subsequent years had fallen due by the time the writ petition was decided. Furthermore, the Court noted that the petitioner had previously agreed to clear their tax liability, as indicated in paragraph 4 of the original order, and accepting the current request would allow them to resile from that stand. The Court also pointed out that its modification application was allowed, clarifying that the petitioner only needed to deposit the amount as determined by the Authority. Any incorrect adjudication or demand would give rise to a separate cause of challenge. Therefore, the Court found no sufficient ground to review the order, except to clarify the factual recital in paragraph 2 in light of the present order. The review application was disposed of with this clarification.

Key Issues

1. Whether the observation in paragraph 2 of the order dated 26.08.2022, stating that the GST registration was cancelled due to non-filing of returns for the years 2018-19, 2019-20, and 2020-21, is factually incorrect and warrants a review of the order? Petitioner's Contention: The petitioner argued that the cancellation order was dated 25.09.2019, and therefore, the non-filing of returns for 2019-20 and 2020-21 could not have been a reason for cancellation at that time. They contended that the Court should have allowed them to file returns for the period up to the cancellation date and then allowed the writ petition. Respondents' Contention: The respondents did not dispute that by the time the writ petition was decided, the returns for 2019-20 and 2020-21 had fallen due. They also did not object to the delay condonation application.