The Jharkhand High Court in its ruling has allowed the filing of an application for revocation of cancelled GST registration, despite the expiration of the limitation period.
The decision derived from a petition furnished via a proprietor aggrieved by the dismissal of their petition u/s 107 of the Central Goods and Services Tax Act, 2017 (GST Act). The applicant asked to claim an option under section 30 of the GST Act for revocation of the cancellation of registration.
The applicant had approached the court as a proprietor of M/s Dresco Tailors with the above-said prayers. The applicant appealed that his proprietary Firm was duly registered under the Goods and Services Tax Act, 2017 whereas the said registration was cancelled on the ground that the Firm had failed to file the returns for a continuous period of 6 months.
The petitioner against the order of cancellation filed an appeal under section 107 of the GST Act which was dismissed on the ground that the petition was barred by limitation.
The applicant’s counsel referring to the Notification on 31st March 2023 which was issued by the Directorate of Revenue, Ministry of Finance, Government of India by which the time for applying for the revocation of cancellation was extended till 30th June 2023, claimed that due to lack of time, he cannot claim of the benefit under the Notification as the appeal filed by him against the order of the cancellation of registration was due and in the meantime the due date for creating the application for revocation of the cancellation of GST registration under the said Notification lapsed dated 30th June 2023.
The counsel for the GST/Income Tax Department proposed that the limitation period for filing an application u/s 30 of the GST Act had already expired and, thus, the Court may not grant any indulgence in the case.
Section 39 of the GST Act furnishes that every registered person excluding an input service distributor or a non-resident taxable individual will for every calendar month or part thereof file inward and outward supply of goods and services return.
There are other requirements/stipulations u/s 39 which every registered person/Firm needs to comply with. Section 45 delivers a window to the registered person/Firm for restoration of the registration by permitting/furnishing a final return within 3 months from the cancellation date or from the date of the order of cancellation whichever is later. U/s 30, any registered person whose registration is cancelled may apply for revocation of cancellation of registration in the specified form.
The division bench including Acting Chief Justice Shree Chandrashekhar and Justice Navneet Kumar observed, “The primary object behind the GST Act is levy and collection of tax on intra State supply of goods or services and the matters connected therewith or incidental thereto. Now the cancellation of registration shall ensue serious civil consequences for the petitioner and his entire business shall come to a standstill. The provisions under sections 30, 45, 46, 47 etc. are intended at providing opportunity to the defaulter Firm so as the Firm continues its business.”
“Thus, a liberal approach is required to be taken in cases like the present proceeding notwithstanding the period prescribed under section 30 of the GST Act having been lapsed. Having thus examined the materials on record, we think that permission to the petitioner to apply to section 30 of the GST Act can be granted subject to the petitioner making payment of dues and other statutory penalties/fines for moving the application under section 30 of the GST Act,” the bench expressed.
Read Also: What to do If GST Registration is Cancelled via Suo Moto
The court permitted the petition and ruled that the writ petition succeeded to the extent that the applicant might file an application u/s 30 of the GST act within 30 days and the limitation period will be counted from the order date.
| Case Title | M/s Dresco Tailors Vs The Principal Commissioner, Central Goods and Service Tax |
| Case No | W.P(T) No. 827 of 2024 |
| Date | 06.03.2024 |
| Counsel For Appellant | Mr. Nitin Kumar Pasari, Advocate |
| Counsel For Respondent | Mr. Amit Kumar, Sr. S.C. (G.S.T.) |
| Jharkhand High Court | Read Order |