Megha Agarwal vs. State Of U.P. And 3 Others

Held

The Court allowed the writ petition. The Court found the instructions provided by the respondent authorities to be "totally hopeless" and prima facie indicative of negligence, as they failed to address the relief sought by the petitioner. The respondents neither opposed the refund nor provided reasons for not deciding the petitioner's application. Consequently, the Court directed respondent no. 3 (Assistant Commissioner of Commercial Tax Sector-7, Moradabad) to decide the petitioner's application dated December 9, 2020, in accordance with the law within three weeks of receiving a certified copy of the order. The issue of the legality of the late fees was implicitly addressed by the direction to decide the refund application, and the Court did not expressly leave any issue undecided.

Facts

The petitioner, Megha Agarwal, operating under the name M/S Krishna Vasu Metal work, had her GST registration cancelled on November 30, 2019, after a survey found her business premises nonexistent at the declared address. Her subsequent application for revocation of cancellation was rejected on December 24, 2019. However, an appeal to the Additional Commissioner Grade-2, Appeal, Moradabad, resulted in her registration being reinstated on November 4, 2020. During the period between the cancellation and reinstatement of her registration (approximately one year), the GST portal required her to pay late fees to file her returns. Consequently, the petitioner deposited Rs. 45,400/- as late fees and filed her returns. She has now filed a writ petition seeking a refund of this amount and a direction to decide her representation dated December 9, 2020.

Key Issues

1. Whether the late fees deposited by the petitioner are illegal and arbitrary, considering her GST registration was reinstated retrospectively. 2. Whether the respondent authorities have failed to decide the petitioner's representation dated December 9, 2020, for refund of the late fees. Petitioner's Arguments: The petitioner argues that the late fees were illegally and arbitrarily demanded by the portal because her registration was ultimately revoked retrospectively. She contends that since her registration was reinstated, the period of cancellation should not attract late fees. She also seeks a direction for the timely disposal of her refund application. Revenue's Arguments: The learned standing counsel for the respondent (State of U.P. and others) did not oppose the relief sought by the petitioner. The instructions provided by the Assistant Commissioner of Commercial Tax indicated negligence and did not offer any opposition to the refund or the decision on the representation.