Cancellation of GST Registration due to Non-Payment of Tax: Madras HC directs to Revive GST Registration

The Madras High Court directed to revive the Goods and Service Tax (GST) registration once cancelled due to Non-Payment of Tax. The revival happens only after payment of tax dues. M/S Smt Ready Mix Concrete, the petitioner challenged the proceedings of the 1st respondent. The petitioner sought to quash the same as illegal and to direct the 1st respondent to revoke the cancellation of the petitioner’s GST registration within the stipulated time. Mr.A.P.Srinivas, Senior Standing Counsel appeared on behalf of the respondent. The counsel for the petitioner submitted that the issue involved in the present writ petition has been covered by the judgement of the Court in W.P.No.25048 of 2021 dated 23.09.2021 and the said writ petition is allowed by the Court.

The Court viewed that “214. By not allowing the petitioners to revive their registration is to de-recognise a whole lot of entrepreneurs and to not to collect GST at all from them. 215. It will only strain the system, as these petitioners will continue to carry on their business and supply goods and service and/or end up not paying the GST under the respective GST enactments. It will  lead to loss of revenue to the Government which is not intended when these enactments were enacted.

The provisions of the GST Enactments and the Rules made there under read with various clarifications issued by the Central Government under the decision of the GST Council and the Notification issued thereunder the respective enactments also make it clear, the intention is only to facilitate and not to debar and de-recognised assesses from coming back into the GST fold.” While allowing the petition, it was viewed that if the petitioner is liable to pay any tax or penalty, he must pay the same by law. A Single Bench of Justice Krishnan Ramasamy set aside the impugned proceedings and directed the respondent department to restore the GST registration of the petitioner.

Leave a Reply