2024 (8) TMI 1450 - HC - GST

Cancellation of GST registration and seeking a direction to the respondent to restore the registration of the petitioner - delay of six months in filing the returns - valid reason for delay or not - HELD THAT - This court is of the view that the reason assigned by the petitioner for non compliance with the relevant provisions of the Act within the time appears to be bona fide. The petitioner is directed to file returns for the period prior to the cancellation of registration if not filed together with tax dues along with interest thereon and the fee fixed for belated filing of returns within a period of forty five (45) days from the date of receipt of a copy of this order - the cancellation of Registration stands revoked subject to the fulfilment of the conditions imposed - petition disposed off.

Summary

Issues:
Challenge of cancellation of GST registration and restoration of registration.

Analysis:
The petitioner challenged the cancellation of GST registration due to non-compliance caused by the COVID-19 pandemic and subsequent lockdown, leading to delayed filing of returns. The respondent issued a show cause notice proposing cancellation, which was followed by the actual cancellation order. The petitioner, upon becoming aware of the order, paid a significant sum towards the tax liability. The court acknowledged the genuine reasons for non-compliance due to the pandemic.

The court revoked the cancellation of registration subject to specific conditions. The petitioner was directed to file returns for the period before cancellation, pay tax dues with interest and fees for belated filing within 45 days. It was clarified that such payments cannot be made from unutilized Input Tax Credit (ITC) without scrutiny and approval. Any unutilized ITC must be approved before utilization for future tax liabilities. The petitioner was also required to pay GST and file returns for the period after cancellation, declaring the correct value of supplies.

Additionally, any earned ITC could only be utilized after approval by the respondent or a competent authority. Upon payment of tax, penalty, and return filing, the registration would be revived, and the bank account attachment lifted. The respondent was instructed to make necessary changes in the GST Web portal to facilitate these actions within 45 days. Non-compliance with any condition would automatically revoke the benefits granted under the order.

With these directions, the writ petition was disposed of without costs, and the connected miscellaneous petition was closed.