Facts of the Case

The petitioner had been granted GST registration, which was subsequently cancelled by the Assistant Commissioner, Haldwani Sector–1, through an order dated 16 June 2022.

Aggrieved by the cancellation of the GST registration, the petitioner approached the High Court by filing the writ petition. The petitioner sought quashing of the GST registration cancellation order and expressed readiness to pay the balance tax, interest thereon and late fee, if any.

The petitioner also sought a direction requiring the concerned respondent to decide the appeal on merits. In addition, the petitioner requested permission to submit an application under Section 30 of the CGST Act, 2017 for revocation of cancellation of the GST registration and sought a direction to the competent authority to consider such application in accordance with law.

A significant factual aspect highlighted before the Court was that the impugned order reflected the petitioner’s tax liability as NIL, indicating that no revenue demand existed against the petitioner.

Issues Involved

The principal issues before the High Court were:

  1. Whether the petitioner could be granted an opportunity to seek revocation of cancellation of GST registration under Section 30 of the CGST Act, 2017.
  2. Whether a manual application for revocation of cancellation of GST registration could be permitted in the facts and circumstances of the case.
  3. Whether an appeal under Section 107 of the Uttarakhand GST Act, 2017 would lie before the Commissioner when the Commissioner is not an adjudicating authority.
  4. What relief should be granted where the cancellation order itself reflected NIL tax liability and no revenue demand existed against the petitioner.

Petitioner’s Arguments

The petitioner submitted that the controversy involved in the writ petition was covered by the Division Bench judgment of the High Court in Vinod Kumar vs Commissioner, Uttarakhand State GST & Others, Special Appeal No. 123 of 2022, decided on 20 June 2022.

Relying upon the said precedent, it was argued that the Commissioner is not an adjudicating authority and, therefore, an appeal under Section 107 of the Uttarakhand GST Act, 2017 would not lie before the Commissioner.

The petitioner further pointed out that the impugned cancellation order showed the tax liability as NIL, demonstrating that there was no revenue demand outstanding against the petitioner.

The petitioner also expressed readiness to pay the balance tax, interest and late fee, if any, and sought an opportunity to apply for revocation of cancellation of the GST registration under Section 30 of the CGST Act, 2017.

Respondent’s Arguments

The State was represented by the learned Standing Counsel.

The order does not record any detailed independent counter-submissions or elaborate objections advanced on behalf of the respondents against the petitioner’s reliance on the Division Bench judgment in Vinod Kumar vs Commissioner, Uttarakhand State GST & Others.

Accordingly, no argument beyond what is expressly reflected in the judicial order should be attributed to the respondents.

Court Order / Findings

The High Court disposed of the writ petition by granting liberty to the petitioner to submit a manual application for revocation of cancellation of the GST registration.

The Court directed as follows:

  • The petitioner was permitted to make a manual application for revocation of cancellation of the GST number.
  • Such application was required to be filed within 10 days before the Assistant Commissioner, Haldwani Sector–1.
  • If such an application was filed, the competent authority was required to dispose of it through a speaking and reasoned order.
  • The petitioner was required to be afforded a reasonable opportunity of hearing.
  • The application was directed to be decided within 30 days of its filing.

Thus, the High Court provided a procedural remedy enabling the petitioner to seek revocation of the cancelled GST registration through a manual application before the competent authority.

Important Clarification

This order is important for the following reasons:

First, the Court permitted the taxpayer to submit a manual application for revocation of cancellation of GST registration.

Second, the order ensured procedural fairness by requiring the competent authority to provide a reasonable opportunity of hearing before deciding the application.

Third, the authority was specifically directed to pass a speaking and reasoned order, thereby requiring proper consideration and recorded reasons.

Fourth, the Court prescribed a clear timeline: the petitioner had to apply within 10 days, and the authority had to decide the application within 30 days of filing.

Fifth, the petitioner specifically relied upon the Division Bench ruling in Vinod Kumar vs Commissioner, Uttarakhand State GST & Others, wherein it was held that the Commissioner is not an adjudicating authority and, therefore, an appeal under Section 107 of the Uttarakhand GST Act, 2017 shall not lie to the Commissioner.

Sixth, the impugned order reflected NIL tax liability, which was relied upon to show that no revenue demand existed against the petitioner.

Sections Involved

Section 30 of the CGST Act, 2017 — Revocation of Cancellation of Registration

Section 30 concerns revocation of cancellation of GST registration. The petitioner specifically sought permission to file an application under this provision for revocation of cancellation of the GST registration.

Section 107 of the Uttarakhand GST Act, 2017 — Appeal to Appellate Authority

Section 107 governs the statutory appellate remedy. The petitioner relied upon Vinod Kumar vs Commissioner, Uttarakhand State GST & Others for the proposition that the Commissioner is not an adjudicating authority and, therefore, the appeal contemplated in the circumstances referred to in the judgment would not lie to the Commissioner.

Key Takeaway

The High Court of Uttarakhand permitted the petitioner to submit a manual application for revocation of cancellation of GST registration within 10 days before the Assistant Commissioner, Haldwani Sector–1. The competent authority was directed to decide the application within 30 days by a speaking and reasoned order after providing a reasonable opportunity of hearing. The order also records reliance on Vinod Kumar vs Commissioner, Uttarakhand State GST & Others concerning the maintainability of an appeal under Section 107 of the Uttarakhand GST Act, 2017 before the Commissioner.

Link to Download the Order

https://www.mytaxexpert.co.in/uploads/1783333989_1243compressed.pdf

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