Return Not Filed Within Time Due To Unavoidable Circumstances: Allahabad High Court Directs Restoration Of GST Registration

The Allahabad High Court has directed restoration of GST registration of a firm as return could not be filed in time due to unavoidable circumstances. The Court noted that mother and sister of the petitioner died of prolonged illness, due to which petitioner suffered both mentally and financially, which were unavoidable circumstances.

Petitioner was registered under Goods and Service Tax Act, 2017. The proprietor could not file returns for the petitioner for a consecutive period of six months. A show cause notice was issued against petitioner proposing cancellation of GST registration under Section 29 (2) (c) of GST Act. Due to bereavements in the family, appropriate reply could not be filed within time. Petitioner approached the High Court against the cancellation; however, the petition was dismissed in lieu of alternate remedy. Thereafter, an appeal was filed, which was also rejected.

Counsel for petitioners submitted that due to death of the mother and sister of the proprietor, he was mentally and financially exhausted and could not file the return on time. It was submitted that petitioner is willing to deposit all dues along with interest, in installments. However, since the registration is cancelled, petitioner is unable to deposit the amount online. Accordingly, prayer for restoration of GST registration was made.

Per Contra, Counsel for State alleged that petitioner had been realizing GST from its customers but not depositing the same with the department. Further, since there was default in filing the returns consecutively for more than six months, action taken against the petitioner was justified.

Taking note of the decision of the Kerala High Court in Pazahyidom Food Ventures (P) Ltd., Vs. Superintendent Commercial Tax, CGST and the judgment of Guwahati High Court in M/s. Veteran Facility Management Services Pvt., Ltd., Vs. The Union of India & 5 others, bench comprising of Justice Piyush Agrawal held that in peculiar circumstances of the case was willing to deposit the amount of tax.

Accordingly, the Court directed the respondent to restore the GST registration of the petitioner and directed the petitioner to deposit Rs. 6,00,000/- after restoration. The remaining amount shall be deposited by the petitioner thereafter in six equal monthly installments.

Case Title: M/S Ennkay Timbers And Another vs. State Of U.P. And 2 Others 2023 LiveLaw (AB) 381 [WRIT TAX No. - 1208 of 2022]

Case Citation: 2023 LiveLaw (AB) 381

Counsel for Petitioner: Pragya Pandey

Counsel for Respondent: Ravi Shanker Pandey

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