Officials Cancelled GSTIN Despite Proof of Monthly GST Returns: Madras HC Sets Aside Cancellation Order

The cancellation of the GST registration of the applicant has been revoked by the Madras High Court, remarking that the applicant has furnished proof of timely submission of monthly returns. The court remarked that a procedural lapse via the department which was not able to consider the furnished evidence of filings before the issuance of the cancellation order.

The GST registration of the applicant was first suspended because of not filing the monthly return from October 2023, attributed to the medical condition of the applicant. The respondent in answer to the same lapse has furnished a cancellation order dated 09.11.2023. But the applicant has appealed the decision and the GST registration was restored dated 17.05.2024.

The applicant even after the restoration obtained an SCN on 21.05.2024, accusing them of failing to furnish the returns from October 2023 to April 2024. Opposing that the applicant furnished the evidence of having the return filed earlier for the said duration. Despite this, the respondent chose to cancel the GST registration again, which has led to the current writ petition.

Read Also: Delhi HC Quashes GST Cancellation Order Due to Lack of Specifics in Show Cause Notice

The applicant claimed that the respondent had not considered the furnished evidence of compliance and furnished the cancellation order without effective consideration.

Conversely, the Additional Government Pleader representing the respondent argued that the cancellation was warranted because of the persistent failure to submit returns.

It was remarked by the court that the applicant has suffered problems due to medical issues and chose the steps to follow with the GST filing needs. The court noted that the respondent department’s failure to regard the proof of filing of the applicant comprised a procedural lapse.

The Bench of Justice, Krishnan Ramasamy has revoked the cancellation of the GST registration of the applicant within the below-said conditions-

(i) The respondent needed to specify the GST network in New Delhi to make the essential amendment to the GST web portal to allow the applicant to furnish the returns and settle any left tax, penalty, or fines within 4 weeks from the order of the receipt.

(ii) The applicant is obligated to furnish all the due returns for the pertinent duration including any outstanding taxes, interest, and late fees within 4 weeks from the GST registration restoration date.

(iii) Payments for taxes, interest, fines, or fees cannot be made or adjusted via any unutilized or unclaimed Input Tax Credit (ITC) carried by the petitioner.

(iv) Any unused ITC should be investigated and approved by a competent officer before it can be utilised.

(v) Merely the ITC that has been approved might get utilised to settle the forthcoming tax obligations under the act and rules.

(vi) Any ITC earned should get approved via the related authority before utilization.

(vii) Negligence to comply with these prerequisites will result in the automatic cessation of the reinstatement benefits.

Read Also: Madras HC Cancels GST Order Due to Petitioner Not Being Aware of Notice Uploaded on Portal

Through such navigation, the writ petition is disposed of Mr P.V.Sudakar and Mr T.N.C. Kaushik appeared for the applicant and respondents respectively.

Case Title	Ms Aziha and Sons vs. the Commercial Tax Officer
Citation	W.P.No.21497 of 2024
Date	03.09.2024
For Petitioner	Mr P.V.Sudakar
For Respondents	Mr T.N.C.Kaushik, Additional Government Pleader
Madras High Court	Read Order