Case Law Details
M. Mallika Mahal Vs Commissioner of Central GST and Central Excise (Madras High Court)
GST Returns can be filed for the period prior to cancellation of GST registration
The Hon’ble Madras High Court in M. Mallika Mahal v. The Commissioner of Central GST and Central Excise [WP.Nos.10663 of 2022 dated August 17, 2022] held that the assessee should be permitted to file GST returns for the period before the cancellation of GST Registration and make payment of tax dues along with interest. Also, the Court directed the assessing authority to instruct GSTN to make necessary changes in the portal to facilitate these changes.
Facts:
M. Mallika Mahal (“the Petitioner”) was given several opportunities that were extended to them even though they missed those opportunities post-cancellation of the registrations by way of Amnesty Schemes wherein they were granted an extension of time to take necessary steps to restore the cancelled registrations. There are various remedies mentioned in the Central Goods and Services Act, 2017 (“the CGST Act”). As per Section 30 of the CGST Act, the benefit has to be availed within thirty days from the date of cancellation of the order, but the Petitioner did not avail this remedy.
Further, the other available remedy is to file an appeal before the Appellate Authority (“the Respondent”) within a period of three months from the date of communication of the cancellation order to the dealer. Although the Petitioner availed this remedy, with a delay, and the appeal was accompanied by returns for a period of six months with the admitted tax.
But, the Respondent rejected the appeal against which the present writ petitions have been filed by the Petitioner.
Issue:
Whether or not the Petitioner can file GST returns for the period prior to the cancellation of GST registration?
Held:
The Hon’ble Madras High Court in WP.Nos.10663 of 2022 dated August 17, 2022, held as under:
- Observed that the Petitioner are permitted to file their GST returns for the period prior to the cancellation of registration, if such returns have not been already filed, together with tax defaulted which has not been paid prior to cancellation along with interest for such belated payment of tax and fine and fee fixed for belated filing of returns for the defaulted period under the provisions of the CGST Act, within a period of 45 days from the date of receipt of a copy of this order, if it has not been already paid.
- Directed the Respondent to take steps by instructing GST Network, New Delhi to make suitable changes in the architecture of the GST Web Portal within a period of 45 days from the date of receipt of a copy of this order to allow the Petitioner to file their returns and to pay the tax, penalty, or fine.
- Therefore, the writ petition was allowed by the Hon’ble Court in favor of the Petitioner.
Relevant Provisions:
Section 30 of the CGST Act:
“Revocation of cancellation of registration.
30. (1) Subject to such conditions as may be prescribed, any registered person, whose registration is cancelled by the proper officer on his own motion, may apply to such officer for revocation of cancellation of the registration in the prescribed manner within thirty days from the date of service of the cancellation order.
Provided that such period may, on sufficient cause being shown, and for reasons to be recorded in writing, be extended,-
(a) by the Additional Commissioner or the Joint Commissioner, as the case may be, for a period not exceeding thirty days;
(b) by the Commissioner, for a further period not exceeding thirty days, beyond the period specified in clause (a).
(2) The proper officer may, in such manner and within such period as may be prescribed, by order, either revoke cancellation of the registration or reject the application:
Provided that the application for revocation of cancellation of registration shall not be rejected unless the applicant has been given an opportunity of being heard.
(3) The revocation of cancellation of registration under the State Goods and Services Tax Act or the Union Territory Goods and Services Tax Act, as the case may be, shall be deemed to be a revocation of cancellation of registration under this Act.”
GST Registration Cancellation: HC directs suitable charges in architecture of GST Portal
i. The petitioners are permitted to file their returns for the period prior to the cancellation of registration, if such returns have not been already filed, together with tax defaulted which has not been paid prior to cancellation along with interest for such belated payment of tax and fine and fee fixed for belated filing of returns for the defaulted period under the provisions of the Act, within a period of forty five (45) days from the date of receipt of a copy of this order, if it has not been already paid.
ii. It is made clear that such payment of Tax, Interest, fine/fee and etc. shall not be allowed to be made or adjusted from and out of any Input Tax Credit which may be lying unutilized or unclaimed in the hands of these petitioners.
iii. On payment of tax, penalty and uploading of returns, the registration shall stand revived forthwith.
iv. The respondents shall take suitable steps by instructing GST Network, New Delhi to make suitable charges in the architecture of the GST Web Portal to allow these petitioners to file their returns and to pay the tax/penalty/fine.
FULL TEXT OF THE JUDGMENT/ORDER OF MADRAS HIGH COURT
All writ petitioners have challenged orders passed on various dates cancelling their registrations under the provisions of the Tamil Nadu Goods and Services Tax Act, 2017 (in short ‘Act’).
2. The petitioners have missed the bus in regard to several opportunities that were extended to them post-cancellation of the registrations by way of Amnesty Schemes wherein dealers were granted extension of time to take necessary steps to restore the cancelled registrations.
3. The Act contains two in built modes to enable revocation of cancellation or restoration thereof. The first is the remedy under Section 30 which benefit has to be availed within thirty days from date of cancellation of order. None of these petitioners in this batch have filed application in terms of Section 30.
4. The second remedy relates to filing of an appeal before the Appellate Authority and has to be availed within a period of three months from the date of communication of the cancellation order to the dealer. Barring some petitioners, that is, petitioners in WP.Nos.18698, 17850, 14931, 14369 and 18306 of 2022, none of the petitioners before me have availed this remedy.
5. The Petitioner in WP.No.14931 of 2022 is stated to have availed appellate remedy, though belatedly with a delay of one year and eight days. The appeal was accompanied by returns for a period of six months with the admitted tax. In the case of petitioner in WP.No.17850 of 2022 the delay is stated to be of a period of two years, three months and three days. The appeal was accompanied by returns for a period of six months with the admitted tax.
6. In the case of petitioner in WP.No.18698 of 2022, the delay is stated to be for a period of 165 days. The appeal was accompanied by returns for a period of six months with the admitted tax. In all the above cases, the appellate authority rejected the appeals as against which the present writ petitions have been filed. In WP.No.14369 of 2022, the order of cancellation had come to be passed prematurely, when the default in filing return was itself only for one month, contrary to the statutory provision. Be that as it may, return for the month of September 2020 is stated to have been filed along with admitted tax for both months.
7. All other petitioners have approached this Court direct, by way of writ petition, seeking the relief of restoration. A learned Single Judge of this Court in a batch of writ petitions in WP.Nos.25048 of 2021 and batch has, by way of an order dated 31.01.2022, considered the cases of identically placed petitioners as before me. In the cases of those petitioners as well, orders of revocation had been passed and some of the petitioners had approached the assessing authority in terms of Section 30 seeking revocation, some had appealed the orders of cancellation under Section 107 and others had merely approached this Court under Article 226 of the Constitution of India.
8. The learned Judge has considered interim events including the position that Amnesty Schemes had not been availed by those petitioners. In fine, the learned Judge accepts the case of the petitioners, imposing certain conditions in para 229 of the order. A specific query was put to the State Counsel as to whether order dated 31.01.2022 has attained finality. He brings to my notice a communication that has been addressed by the Additional Chief Secretary/Commissioner of Commissioner of Commercial Tax to the GST Council on 31.03.2022 seeking the view of the Council and its guidance/directions in regard to the order of this Court dated 31.01.2022.
9. There has been no response to the above communication and the State, like Samuel Beckett’s Godot, has merely been waiting, much past the time for filing of writ appeal before this Court. In my view, this tantamount to their having accepted the order of this Court dated 31.01.2022 as a conscious decision has been taken by the State to let the limitation slip.
10. The State also confirms that the directions as set out in order dated 31.01.2022 have been implemented in the case of all those petitioners. In light of the aforesaid discussion, the following directions at paragraph 129 of order dated 31.01.2022, extracted below, shall be taken to be passed in the present matter as well, effective from date of receipt of this order.
i. The petitioners are permitted to file their returns for the period prior to the cancellation of registration, if such returns have not been already filed, together with tax defaulted which has not been paid prior to cancellation along with interest for such belated payment of tax and fine and fee fixed for belated filing of returns for the defaulted period under the provisions of the Act, within a period of forty five (45) days from the date of receipt of a copy of this order, if it has not been already paid.
ii. It is made clear that such payment of Tax, Interest, fine/fee and etc. shall not be allowed to be made or adjusted from and out of any Input Tax Credit which may be lying unutilized or unclaimed in the hands of these petitioners.
iii. On payment of tax, penalty and uploading of returns, the registration shall stand revived forthwith.
iv. The respondents shall take suitable steps by instructing GST Network, New Delhi to make suitable charges in the architecture of the GST Web Portal to allow these petitioners to file their returns and to pay the tax/penalty/fine.
v. The above exercise shall be carried out by the respondents within a period of forty five (45) days from the date of receipt of a copy of this order.
11. These writ petitions are allowed in the above terms. No costs. Connected miscellaneous petitions are closed.
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GST officer was cnacell the registration, can we opt new registration