Petitioner is the proprietor of a business engaged in execution of works contracts. He had obtained a registration under the Central Goods and Services Tax Act and Kerala State Goods and Services Tax Act of 2017. The said registration came to be cancelled on 02.02.2021 on account of non-filing of returns. As per Section 30 of the CGST Act, 2017, the time limit for applying for the revocation of registration was 30 days from 02.02.2021. The said period of 30 days could be extended by the Joint Commissioner for a further period of 30 days.
However, the petitioner did not file any application for revocation of registration. The petitioner, ultimately filed an appeal under Section 107 of the aforesaid Act before the Appellate Authority, challenging the order revoking the registration, on 20.11.2021. The said appeal was rejected by Ext.P5 on 09.03.2022.
2. Learned counsel appearing for the petitioner has raised several contentions including the contention that the Hon’ble High court of Madras in W.P.(C.). No.25048 of 2021 and connected cases, had held as follows:-
‘’224. Notwithstanding the fact that the petitioners have shown utter disregard to the provisions of the Acts and have failed to take advantage of the amnesty scheme given to revive their registration, this Court is inclined to quash the impugned orders with grant consequential reliefs subject to terms.
225. The provisions of the GST enactments cannot be interpreted so as to deny the right to carry on Trade and Commerce to a citizen and subjects. The constitutional guarantee is unconditional and unequivocal and must be enforced regardless of the defect in the scheme of the GST enactments. The right to carry on trade or professoin also cannot be curtailed. Only reasonable restriction can be imposed. To deny such rights would militate against their rights under Article 14, read with Article 19 (1)(g) and Article 21 of the Constitution of India.
226. As original or as appellate authority exercising power under the respective enactments, quasi judicial officers were bound by the provisions of the Act and the limitation under it, they have acted in accordance with law. They cannot look beyond the limitations prescribed under provisions of the Act. Therefore, no fault can be attributed to their action.
227. This is a fit case for exercising the power under Article 226 of the Constitution of India in favour of the petitioners by quashing the impugned orders and to grant consequential relief to the petitioners. By doing so, the Court is effectuating the object under the GST enactment of levying and collecting just tax from every assessee who either supplies goods or service. Legitimate Trade and Commerce by every supplier should be allowed to be carried on subject to payment of tax and statutory compliance. Therefore, the impugned orders deserve to be quashed.
228. These petitioners deserve a chance and therefore should be allowed to revive their registration so that they can proceed to regularize the defaults. The authorities acting under the Act may impose penalty with the gravity of lapses committed by these petitioners by issuing notice. If required, the Central Government and the State Government may also suitably amend the Rules to levy penalty so that it acts as a deterrent on others from adopting casual approach.’’
It is submitted that, as far as the petitioner is concerned, the petitioner will be put to great prejudice and hardship, if the cancellation of registration is not revoked as the petitioner is unable to collect amounts from various Government agencies for works completed by the petitioner. It is submitted that those Government agencies will not release payments to the petitioner, if there is mismatch in the GST registration details.
3. Learned Senior Government Pleader appearing for respondent Nos.2 and 4 and the learned Senior Standing Counsel appearing for respondent Nos.1 and 3 would point out the provisions of section 29 and 30 of the CGST Act and submit that there is absolutely nothing illegal about the orders impugned as they are orders issued completely in consonance with the statutory provisions and require no interference under Article 226 of the Constitution of India. It is submitted that the judgment of the Hon’ble Madras High Court essentially results in the entire statutory scheme being violated and may not be treated as a precedent in this Court. It is submitted that there is no question of the petitioner being unable to carry on his business as it is always open to the petitioner to apply for a new registration and carry on business with the new registration. It is pointed out that the cancellation of earlier registration does not cause any prejudice to the petitioner. It is submitted that a person who has not taken any steps within the timelines provided by the Statute and also within any extended time granted by the Circulars issued by the the Central Board of Excise and Customs, cannot be heard to contend that notwithstanding the statutory provisions, this Court, in the exercise of Article 226 of the Constitution of India must direct the restoration of the registration.
4. Considering the contentions raised by both sides, I had requested Adv. A Kumar, learned counsel of this Court to assist this Court to reach a proper conclusion in this matter.
Sri. A Kumar has placed before me judgment of the Division Bench of the Gujarat High Court in Special Civil Application No.3442 of 2022 [Tahura Enterprise V. Union of India] and the judgment of the Madhya Pradesh High Court in W.P. No.8162 of 2021 [MAA Sharda Construction Company V. Union of India and Others]. It is submitted that the view taken by the Madras High court should be the view to be adopted by this Court since no tax law should be construed as creating difficulties in the doing of business and the State should essentially be concerned about collecting taxes and penalties wherever applicable rather than relying on technicalities to deny the restoration of registration in cases like this. It is submitted that that even if this Court is to grant relief to the petitioner, it would be open to this Court to hold that all consequences of cancellation of registration, non-filing of returns, non-payment of tax etc., will continue to apply notwithstanding any direction issued by this Court to accept any application for revocation filed by the petitioner beyond time. It is submitted that in almost similar circumstances, the High Court of Gujarat In Tahura Enterprises (Supra) held as follows:-
‘’8. Indisputably, the cancellation of registration was on the ground of non-filing of returns by the writ-applicants. The impugned order cancelling the registration came to be passed on 10.07.2019. The writ-applicants preferred an application before the appellate authority for revocation of cancellation of registration, but such application was not entertained on the ground that the same was time barred.
9. We take notice of the fact that the Central Board of Indirect Taxes and Customs extended the time limit for filing application for revocation of cancellation of registration and the limitation for all the orders passed on or before 12.06.2020 was to effectively commence from 31.08.2020. As the application filed by the writ applicants for revocation of cancellation of registration was looked into by a quasi-judicial authority, the order of the Supreme Court extending the period of limitation in view of the Covid-19 Pandemic would apply and in such circumstances, the limitation in accordance with the order passed by the Central Board of Indirect Taxes and Customs could be said to have been extended.
10. Indisputably, the application requesting for restoration of registration was filed in July 2021 i.e. during the period when the order of the Supreme Court extending the limitation was in operation. More importantly, the writ-applicants have paid the requisite amount towards tax on the basis of self assessed liability on 06.09.2021. Since the registration of certificate of the writ-applicants came to be cancelled solely on the ground of non-filing of the returns, which was on account of nonpayment of tax and the writ-applicants now having paid such outstanding tax, the registration certificate of the writ-applicants should be ordered to be restored so that they are able to continue with their business.
11. In view of the aforesaid, the impugned order dated 10.07.2019 cancelling the registration certificate is hereby quashed and set aside. The respondents are directed to forthwith restore the registration certificate of the writ-applicants under the provisions of the G.S.T. Act.’’
5. It is also brought to my notice by Sri. A Kumar that considering the problems created by the Covid-19 pandemic, the period from 15.03.2020 till 28.02.2022 had been excluded for the purposes of any limitation by orders of the Hon’ble Supreme Court of India in Suo Moto Writ Petition No.3 of 2020. It is submitted that the periods of limitation prescribed under Section 30 of the CGST Act should also be deemed to have been extended by virtue of the orders of the Hon’ble Supreme Court and therefore, the period of limitation should be read as extended till 28.05.2022 as directed by the Hon’ble Supreme Court in the Suo Moto Writ Petition No.3 of 2020, on 10.01.2022.
6. Having heard the learned counsel as above, I am of the view that the the petitioner is entitled to relief. The facts of this case show that the registration the petitioner was cancelled on 02.02.2021. The petitioner had time of 30 days from 02.02.2021 to file an application for revocation. The said period of 30 days could be extended by a period of 30 days by the Joint Commissioner, going by the provisions contained in Section 30 of the CGST Act. If one were to apply the directions issued by the Hon’ble Supreme Court in Suo Moto Writ Petition No.3 of 2020, to the periods of limitation prescribed by Section 30 of the CGST Act, it can be held, without any difficulty, that the petitioner had time till 28.05.2022 to file an application for revocation. The petitioner filed an appeal and possibly, by bona fide mistake, did so on 20.11.2021. This can only be seen as a availing of a wrong remedy by the petitioner. If that date was taken as the application for revocation, the period of the application for revocation can be treated as one filed within time.
Accordingly, this writ petition is allowed and it is directed that if the petitioner files a fresh application for revocation within seven days from the date of receipt of a certified copy of this judgment, the same shall be treated as one filed on 20.11.2021 and the orders shall be passed by the 1st respondent, treating the application as one filed within time, taking into consideration the orders of the Hon’ble Supreme Court in Suo Moto Writ Petition No.3 of 2020. However, it is made clear that all legal consequences under the provisions of the GST Acts and the Rules (following cancellation of registration and belated filing of returns) shall continue to operate against the petitioner and the restoration of registration by orders of this Court as above, will not result in the petitioner being absolved of any statutory liability as aforesaid. In other words, the statutory liabilities of the petitioner following cancellation of registration, non-filing of returns and non-payment of tax will continue to operate against the petitioner notwithstanding the directions contained in this judgment.
The writ petition is allowed as above.