Super Enterprises Vs. Union of India & Others (Patna High Court)
Summary: The Patna High Court considered a writ application filed by M/s Super Enterprises challenging the dismissal of its appeal against cancellation of GST registration on the ground of limitation. The petitioner also challenged the ex-parte cancellation order and sought restoration of its GST registration.
The petitioner submitted that it had been furnishing annual and monthly returns under the Bihar Goods and Services Tax Act, 2017 (BGST Act), but due to unavoidable circumstances which rendered the proprietor immobile and affected his ability to manage the business, returns could not be filed for six months. It was further submitted that the petitioner’s consultant failed to inform it about the show cause notice (SCN) and the non-filing of returns.
According to the petitioner, the SCN dated 06.02.2024 was uploaded on the web portal and required a response within 30 days. However, the date of hearing was fixed as 05.03.2024, before the expiry of the period available for filing the reply, which was stated to be 07.03.2024. Relying upon Section 75(4) of the BGST Act, the petitioner contended that the personal hearing was required to be fixed where an adverse decision was contemplated and that fixing the hearing date before the reply deadline rendered the procedure an empty formality.
The petitioner stated that an ex-parte order dated 22.04.2024 cancelled its registration. Subsequently, it furnished GSTR-3B and GSTR-1 returns and paid the pending taxes, late fee and penalty. The petitioner relied upon these subsequent compliances to demonstrate its bona fides and intention to comply with statutory obligations.
The petitioner had thereafter preferred an appeal before the Additional Commissioner (Appeals), Muzaffarpur on 16.06.2025 against cancellation of its registration. The appeal was rejected by order dated 21.07.2025 on the ground of limitation.
Reliance was also placed upon M/s Galaxy Heights Vs. The Union of India and Others (CWJC No.4204 of 2025). The petitioner submitted that the Court had taken the view in an identical circumstance that permanent cancellation of registration was likely to inflict civil death upon the livelihood of the petitioner because, following cancellation, the petitioner would never be in a position to carry on its business.
The respondents opposed the writ application, stating that the taxpayer had not been prompt in filing returns. According to the respondents, on two earlier occasions SCNs for cancellation of registration had been issued but were dropped after responses were received. In the present case, however, the petitioner did not submit a response to the SCN and had failed to furnish returns after June 2023. The respondents therefore contended that continuous failure to file returns for six months/two quarters invited the cancellation action.
The respondents further submitted that adequate opportunity had been given to the petitioner to file the SCN response and that the petitioner could not rely upon the laches of its consultant. They also contended that the appeal had been filed at a much belated stage and that the Appellate Authority had committed no error in dismissing it on limitation.
Upon considering the records, the Division Bench noted that the petitioner had already submitted its GSTR-3B and GSTR-1 returns on 26.05.2025 and had paid the entire due taxes together with late fee and penalty. The Court acknowledged that the petitioner had failed to file returns for six months, which invited the impugned action, but found that the date for personal hearing had been fixed only by way of an empty formality.
The Court reproduced Section 75(4) of the BGST Act, which provides that an opportunity of hearing shall be granted where a written request is received from the person chargeable with tax or penalty, or where any adverse decision is contemplated against such person.
On a bare reading of the provision, the Court held that a date for hearing is required to be fixed where an adverse decision is contemplated. In the circumstances before it, the notice had initially been issued to enable the petitioner to show cause. When no show cause was filed within the stipulated 30 days, a date of hearing was thereafter required to be fixed. Similarly, if a show cause had been filed but the authorities were not satisfied with the explanation and contemplated an adverse order, a hearing was required to be fixed.
The Court also referred to its decision in M/s Galaxy Heights (supra), where it had taken the view that permanent cancellation of registration was likely to inflict civil death upon the livelihood of the petitioner. In that case, an application for revocation had been rejected on limitation and the Court had intervened, set aside the orders and remitted the matter to the competent authority for consideration of the revocation application.
In the present case, the Court set aside the appellate order and granted liberty to the petitioner to file an application seeking revocation of the cancellation. The petitioner was permitted to file the application within three weeks from 28.08.2026 before the competent authority. If filed within that period, the competent authority was directed to consider the application on its own merit and not reject it on the ground of limitation alone. The competent authority was further directed to pass an appropriate order within two months from the date of filing of the revocation application.
The writ application was accordingly allowed to the extent indicated by the Court.
Cases Discussed
- M/s Galaxy Heights Vs. The Union of India and Others, CWJC No.4204 of 2025 — the Court referred to its earlier view that permanent cancellation of GST registration is likely to inflict civil death on the livelihood of the petitioner and noted that, in that matter, it had intervened where the revocation application was rejected on limitation.
FULL TEXT OF THE JUDGMENT/ORDER OF PATNA HIGH COURT
Heard learned counsel for the petitioner and learned counsel for the respondents.
2. The present writ application has been filed seeking the following reliefs:-
“i. For issuance of writ in the nature of Certiorari for setting aside order dated 21.07.2025 passed by Additional Commissioner, (Appeals), Muzaffarpur in Appeal Case No. GST-403/Pat/2025-26, whereby and whereunder the Appellate Authority dismissed the appeal filed by the petitioner solely on the ground of limitation, without adjudicating the case of merits.
ii. For issuance of an appropriate writ/order/direction for setting aside Ex Parte Order bearing reference no. ZA100424049946J dated 22.04.2024, passed by Respondent Superintendent, CGST & Central Excise, Muzaffarpur, East Range, whereby and whereunder respondent authority proceeded ex-parte and vide order dated 22.04.2024, without providing an opportunity of hearing to the petitioner cancelled the GST registration of the petitioner and the impugned order has been passed without assigning any cogent reasons and specifying the period of default, thereby rendering the order non-speaking and unsustainable in law.
iii. For Issuance of Writ in the nature of Mandamus directing the respondent authority to restore the GST Registration of the Petitioner after revocation of cancellation of registration with immediate effect, as the petitioner had already furnished the pending returns of previous years and further undertake to filed any Pending Return or make payment of any pending tax if any, assessed by respondent authority within Fifteen Days from the date of the Order of this Hon’ble Court.
iv. For issuance of an appropriate Writ(s), order(S), and/or direction(s), as Your Lordships may deem fit and proper in the facts and circumstances of this case in the interest of justice.”
Submissions on behalf of the Petitioner
3. Learned counsel for the petitioner submits that the petitioner was furnishing the annual as well as the monthly returns under the Bihar Goods and Services Tax Act, 2017 (hereinafter referred to as the ‘BGST Act’), however, due to some unavoidable circumstances which rendered him immobile and he was unable to manage the affairs of his business effectively during the relevant period, his returns could not be filed in time. The petitioner admits that because of his illness and resulting incapacity, the return was not filed for six months.
4. In the writ application, the petitioner submits that the show cause notice (in short ‘SCN’) was uploaded on the web portal and the petitioner was directed to submit his show cause within a period of 30 days from the date of service of notice. It is, however, his case that while the authorities fixed 07.03.2024 as the date for filing of the show cause, the date of hearing was fixed even prior to that, on 05.03.2024. In this regard, learned counsel has pointed out from Annexure ‘P/2’ dated 06.02.2024 that the petitioner had to furnish a reply to the notice within 30 days from the date of service of notice. It is submitted that in terms of the scheme of Section 75(4) of the BGST Act, the date of personal hearing was required to be fixed only after the authorities would not have been convinced with the show cause and an adverse order was contemplated. Thus, fixing a date for hearing on 05.03.2024 in the show cause notice (SCN) dated 06.02.2024 was an emptyformality.
5. Learned counsel submits that the consultant of the petitioner failed to inform the petitioner about the SCN and the non-filing of the return, therefore, the petitioner was not aware about the issuance of SCN and no response could be submitted in time.
6. It is submitted that by way of an ex-parte order passed on 22.04.2024 (Annexure ‘P/3’), the registration of the petitioner has been cancelled. The petitioner, however, submitted the returns in GSTR-3B and GSTR-1 as also made the payment of all pending taxes. He also paid the late fee and the penalty, thereby demonstrated his bonafide and his intention to comply with the statutory obligations. A copy of the GSTR-3B return and GSTR-1 return have been annexed as Annexure ‘P/4’ and Annexure ‘P-4/1’ to the present writ application.
7. Learned counsel submits that the petitioner had preferred an appeal before the Additional Commissioner (Appeals), Muzaffarpur on 16.06.2025 challenging the order of cancellation of his registration but the same has been rejected vide order dated 21.07.2025 (Annexure ‘P/6’).
8. Learned counsel submits that in the case of M/s Galaxy Heights Vs. The Union of India and Others (CWJC No. 4204 of 2025), this Court has taken a view in identical circumstance that a permanent cancellation of registration is likely to inflict civil death to the livelihood of the petitioner as because of the cancellation of his registration, he would never be in a position to do his business. It is submitted that in the facts and circumstances of the case, appropriate direction be given to the respondent authorities to consider revocation of the cancellation of registration of the petitioner.
Submissions on behalf of the Respondents
9. A counter affidavit has been filed on behalf of Respondent Nos. 1, 2, 4 & 5. It is the case of the respondents that the tax payer was not prompt in filing his returns. On earlier two occasions, he was served with SCN for cancellation of registration but on getting the response of the petitioner, those SCNs were dropped. In this case, the petitioner did not submit any SCN and as he had failed to furnish his returns after June 2023, hence, failure to file the returns continuously for a period of six months/two quarters invited the impugned action.
10. Learned counsel submits that adequate opportunity was given to the petitioner to file SCN. It is submitted that the petitioner cannot be allowed to take a plea that because of laches on the part of his consultant, the return could not be filed.
11. It is further submitted that the appeal was preferred at a much belated stage, therefore, the Appellate Authority has committed no error in dismissing the appeal on the ground of limitation.
Consideration
12. Having heard learned counsel for the petitioner and learned counsel for the respondent authorities as also on perusal of the records, we find that in this case, the petitioner has already submitted his returns in GSTR-3B and GSTR-1 as back as on 26.05.2025. Copies of the returns are available on the record as noted hereinabove. Petitioner has paid the entire due taxes together with the late fee and the penalty. No doubt, the petitioner had failed to file the return for six months which invited the impugned action but it cannot be denied that the respondent authorities fixed the date for personal hearing only by way of an empty formality.
13. Section 75(4) of the BGST Act reads as under:-
“75. General provisions relating to determination of tax.-
(4) An opportunity of hearing shall be granted where a request is received in writing from the person chargeable with tax or penalty, or where any adverse decision is contemplated against such person.”
14. A bare reading of the aforesaid provision would show that a date for hearing is required to be fixed where any adverse decision is contemplated against the person. In this case, the notice was issued to file show cause. When no show cause was filed within the given period of 30 days, thereafter, a date of hearing was required to be fixed or in case of filing of the show cause, if the authorities would not have been satisfied with the plea taken in the show cause and an adverse order would have been contemplated then in that case also, a date for hearing was required to be fixed.
15. We have taken a view in the case of M/s Galaxy Heights (supra) that a permanent cancellation of registration is likely to inflict civil death to the livelihood of the petitioner. Keeping in view this aspect of the matter, in the facts of the present case, we set aside the appellate order and grant liberty to the petitioner to file an application seeking revocation of the order of cancellation. In M/s Galaxy Heights (supra), the petitioner had filed an application for revocation but that was also rejected on the ground of limitation, therefore, this Court had intervened and set aside the orders and remitted the matter to the competent authority to consider the application for revocation of cancellation and pass an appropriate order.
16. In the present case, we grant liberty to the petitioner to file an appropriate application within a period of three weeks from today before the competent authority seeking revocation of the order canceling the registration of the petitioner. If such an application is preferred within the stipulated period, the competent authority shall consider the same on its own merit and shall not reject the same on the ground of limitation alone. An appropriate order thereon shall be passed within a period of two months from the date of filing of the application for revocation.
17. This writ application stands allowed to the extent indicated hereinabove.
