Case Law Details
Kali Shankar Enterprises Vs Additional Commissioner (Andhra Pradesh High Court)
Introduction: In a significant judgment, the Andhra Pradesh High Court, in the case of Kali Shankar Enterprises vs Additional Commissioner, has ruled that the cancellation of GST registration cannot be justified solely on the grounds of filing nil returns continuously for more than six months. This article provides an in-depth analysis of the case, examining the court’s observations, the grounds for cancellation, and the implications of the ruling.
Detailed Analysis: The petitioner contested the cancellation of their GST registration, which was based on the allegation of filing nil returns continuously for over six months. The court scrutinized the impugned order and observed discrepancies, particularly noting that the petitioner did not file a reply to the show cause notice, and yet, the order mentioned a reply dated 02.2022. The court deemed this as a prima facie non-application of mind and a lack of reasoning in the cancellation order.
The petitioner argued that the ground for cancellation mentioned in the show cause notice, i.e., “filing nil returns continuously for more than 6 months,” does not fall under any of the clauses of Section 29 of the Goods and Services Tax Act or Rule 22 of the GST Rules. The court referred to the relevant sections and rules, emphasizing that there is no specific provision for canceling registration solely based on filing nil returns.
Section 29(2) of the GST Act lists grounds for cancellation, but filing nil returns is not among them. The court held that the impugned order lacked jurisdiction and did not have a valid statutory ground for cancellation. Consequently, both the impugned order and the appellate order dismissing the appeal were set aside.
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