Case Law Details
Sparta Food Factory India Pvt Ltd Vs Superintendent of GST & Central Excise (Madras High Court)
Introduction: In a recent judgment that underscores the importance of compliance with tax return filings under the GST regime, the Madras High Court has set aside an appellate order which rejected Sparta Food Factory India Pvt Ltd’s appeal against the cancellation of its GST registration. This case brings to light critical aspects of GST law, particularly concerning the revocation of cancelled GST registrations.
Detailed Analysis: The crux of the matter lies in the cancellation of the petitioner’s GST registration by the competent authority, effective from 08.10.2022, due to non-compliance with return filing requirements. Subsequently, the petitioner rectified this by filing all pending GST returns by 31.08.2023 and settling all tax dues, including interest and late fees. Despite these corrective measures, the appellate authority dismissed the petitioner’s appeal for reinstatement of its GST registration solely on the grounds of delay, without considering the merits of the case or the petitioner’s compliance efforts.
The High Court, upon examination, found that the petitioner had indeed filed all necessary returns and cleared dues. The court highlighted that the application for revocation of cancellation under Section 30 of the Central Goods and Services Tax Act, 2017 (CGST Act), and Rule 23 of the Central Goods and Services Tax Rules, 2017 (CGST Rules), should take into account the date of the last return filed. The High Court also noted the potential applicability of recent amendments to Section 30 and Rule 23, as well as the amnesty scheme that took effect after the petitioner’s GST registration was cancelled.
Conclusion: The Madras High Court’s decision to remand the matter back to the appellate authority for reconsideration on merits emphasizes the judiciary’s approach towards ensuring that procedural lapses, particularly those rectified by the taxpayer, do not lead to irreversible consequences like the cancellation of GST registration. This judgment serves as a reminder to the business community about the importance of timely compliance with GST return filings and the possibility of relief even after procedural defaults, provided substantive compliance is demonstrated subsequently.
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