Arihant Shree Motors LLP Through Partner Divyakumar vs. Union Of INDIA

Held

The Court allowed the writ petition, setting aside the impugned order dated 04.10.2024 passed by the Joint Commissioner (Appeals). The Court followed the view taken by a Coordinate Bench at Gwalior in M/s. K.N. Developers and Buildcon Pvt. Ltd. vs. State of M.P. & Ors. (W.P. 29802/2025). The reasoning was to provide an opportunity of hearing to the petitioner and to address the issue of denial of manual return submission. The petitioner was directed to submit all pending GST returns, especially for the period when registration was cancelled. Upon submission of these returns, the authority was directed to consider the case for revocation of registration. As a consequence of the default, the petitioner was directed to pay a cost of Rs. 25,000/- to the department along with the pending returns. The Court noted that the order was passed based on the peculiar facts and circumstances and submissions made by the parties.

Facts

The petitioner, Arihant Shree Motors LLP, filed a writ petition challenging an order dated 04.10.2024 passed by the Joint Commissioner (Appeals) CGST, Customs & Central Excise. This appellate order had dismissed the petitioner's appeal against the cancellation of its GST registration. The petitioner contended that the proper authority did not permit the submission of returns manually after the prescribed statutory period. The parties disputed whether the petitioner had received proper notice and had knowledge of the hearing. The petitioner relied on a previous order from a Coordinate Bench at Gwalior in a similar case where GST returns were denied due to the expiry of the statutory period.

Key Issues

1. Whether the petitioner was denied a proper opportunity to submit GST returns manually after the statutory period expired, thereby violating principles of natural justice, as per Section 29 and 30 of the CGST Act, 2017 and Rules 22 and 23 of the CGST Rules, 2017? Petitioner's arguments: The petitioner argued that the proper authority failed to allow the submission of returns manually after the statutory period had elapsed. They relied on a Coordinate Bench order in M/s. K.N. Developers and Buildcon Pvt. Ltd. vs. State of M.P. & Ors. (W.P. 29802/2025) which quashed similar orders where petitioners were denied GST return submission due to expired statutory periods. The petitioner also submitted that if a cost was imposed and an opportunity for revocation was granted, they would not be prejudiced. Revenue's arguments: The respondents referred to Sections 25, 29, and 30 of the CGST Act, 2017, and Rules 21(a) and (h), 22, and 23 of the CGST Rules, 2017. They contended that the petitioner was given sufficient opportunity of hearing but suggested the petitioner could apply for a fresh representation.