Can Non-Restoration of GST Registration be considered a violation of “Right to Livelihood” [Article 21 – Constitution of India]?

Can Non-Restoration of GST Registration be considered a violation of the ‘Right to Livelihood’ [Article 21 – Constitution of India]?

Can rejection of Appeal for restoration of registration violation of the “Right to carry on Business” [Article 19(1)(g) – Constitution]?

GST Registration of the Petitioner was canceled U/s 29 (2) (c) as there was non-filing of returns for a consecutive period of six months.

Instead of seeking revocation of cancellation of registration U/s 30 before the proper officer, appeal U/s 70 was preferred.

This Appeal was filed with a delay of 660 days.

The appeal was REJECTED on the grounds of limitation.

Against this rejection, he approached Orissa High Court through Writ Petition (Certiorari).

The petitioner submitted that the Appellate Authority was not powerless to grant the opportunity to the petitioner to deposit tax, and interest coupled with the penalty and late fee and relegate him to approach the Registering Authority U/s 30 by condoning the delay,

as has been done by this Court in very many cases.

The court observed that refusing to decide the challenge against the order of cancellation of registration on the ground of limitation would be a counterproductive approach as the taxable person is deprived to carry on business in the sense that no tax invoice can be raised

Therefore, the opposite parties are required to take a pragmatic view of the matter.

In the event the GST Registration number is not restored, the petitioner would not be in a position to raise a bill, it would affect his right

it would affect his right to livelihood (Article 21 of the Constitution of India) as also right to carry on business [Article 19(1)(g)].

The court placed its reliance upon the decision in the matter of Tvl. Suguna Cutpiece Center – Madras High Court

High Court permitted the petitioner to file returns for the period prior to the cancellation of registration, if such returns have not already been filed, together with tax defaulted and late fee, within a period of sixty days.

Such payment of tax/interest/penalty/ fine/fee etc. shall not be allowed to be made or adjusted from and out of any Input Tax Credit which may be lying unutilized.

On payment of tax, interest, penalty, and late fee, if any, and uploading of returns, the petitioner is at liberty to file the application for revocation of cancellation of registration within a period of 7 days along with the petition for condonation of delay.

Title: Durga Raman Patnaik vs Additional Commissioner of GST (Appeals)

Court: Orissa High Court

Citation: W.P. (C) No. 7728/2022

Dated: 13-Oct-2022

In my View
Every Registered Person deserves a chance to revive their registration so that they can proceed to regularize the defaults. GST authorities may impose penalties with the gravity of lapses committed by these petitioners by issuing notice.

Article 21 & Article 19(1)(g) of the Constitution of India are sacrosanct No useful purpose will be served by keeping these petitioners out of the bounds of GST regime other than to allow further leakage of the revenue and to isolate these petitioners from the mainstream

Restoring these registrations would not cause any harm to the department but on the other hand, it would be beneficial for the state to earn revenue.

The GSTAT is still non-functional and any appeal against Appeal Orders can’t be filed in GST Appellate mechanism.