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2024 (1) TMI 436 - DELHI HIGH COURTRejection of application filed by the petitioner seeking cancellation of GST registration - application rejected on the ground that petitioner had failed to furnish stock position, value of raw material as well as the value of capital goods - HELD THAT:- In terms of Section 29 sub-section 5 of the Central Goods Services Tax Act, 2017, every person whose registration is cancelled is liable to pay an amount equivalent to the credit of input tax in respect of inputs held in stocks and inputs contained in semi-finished or finished goods held in stock or capital goods of plant and machinery on the day immediately preceding the date of such cancellation or the output tax payable on such goods, whichever is higher. In terms of Section 29(2) of the Act, the proper officer may cancel the GST registration of a person from such date including any retrospective date, as he may deem fit if the circumstances set out in the said sub-section are satisfied. The registration cannot be cancelled with retrospective effect mechanically. It can be cancelled only if the proper officer deems it fit to do so. Such satisfaction cannot be subjective but must be based on some objective criteria. Merely, because a taxpayer has not filed the returns for some period does not mean that the taxpayer’s registration is required to be cancelled with retrospective date also covering the period when the returns were filed and the taxpayer was compliant. A taxpayer’s registration can be cancelled with retrospective effect only where such consequences are intended and are warranted. Clearly, the order is erroneous to the extent that the same could not have been passed retrospectively. The registration was suspended with effect from 02.09.2021. Accordingly, the order is modified to the extent that cancellation shall take effect from 02.09.2021. Petition disposed off.
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