NURUDDIN AHMED PATHAN v. THE STATE OF ASSAM & Ors

Advocate for the Petitioner : MR G N SAHEWALLA, MR. P DEKA,MR M SAHEWALLA Advocate for the Respondent : SC, FINANCE AND TAXATION, Page No.# 2/6 BEFORE HON’BLE MR. JUSTICE ARUN DEV CHOUDHURY ORDER 30-05-2025

1. Heard Mr. P.Deka, learned counsel for the petitioner and Mr. B. Gogoi, learned Standing counsel, Finance and Taxation Department, Assam for the respondent Nos. 1 to

2. The petitioner is a registered Class 1A Contractor in the PWD (road) Division and PWD (building) Division under the Government of Assam and is an Assesee registered under the Central Goods and Services Tax (CGST) Act, 2017/Assam Goods and Services Tax (AGST) Act, 2017 bearing registration No. 18AJLPP9359H2ZE. Because of non-filing of GST returns for a continuous period of six months, the petitioner was served with a show cause notice bearing reference No. ZA180721213204Z dated 30.07.2021 asking him to furnish reply to the aforesaid notice within a period of 7 (seven) days from the date of service of notice and it was mentioned in the aforesaid show cause notice that if the petitioner fails to furnish a reply within the stipulated date or fails to appear for personal hearing on the appointed date and time, the case will be decided ex-parte on the basis of the available records and on merits. However, no date for personal hearing was ever notified. Thereafter, the impugned order dated 10.08.2021 was passed by the Deputy Commissioner of State Tax, Dibrugarh-I, whereby the petitioner’s GST registration has been cancelled for not furnishing returns for a continuous period of 6 (six) or more months.

3. The petitioner contends that due to pandemic Covid-19 as well as his illness and owing some personal difficulties, he could not file the monthly returns as required under the newly formed laws. It is further contended that the petitioner was not very Page No.# 3/6 accustomed with online affairs and had missed the notice on the portal, due to which, he could not file reply to the aforesaid show cause notice within seven days.

4. Learned counsel for the petitioner submits that the impugned order was passed way back in the year 2021 and the petitioner could not file any application for revocation of cancellation within a period of 30 days as prescribed under Section 30 of the AGST Act,

2017. Moreover, the petitioner could not file any appeal under Section 107 of the AGST, 2017 before the appellate authority, wherein the limitation period was three months and the same expired long ago. Since by now the time limit for filing the appeal has already been elapsed and the appellate authority is not vested with any power and jurisdiction to condone the delay beyond one month after the expiry of 3 (three) months, the petitioner has no alternative, approached this Court by filing the present writ petition.

5. Mr. Deka, learned counsel for the petitioner has submitted that the petitioner is ready and willing to comply with all the formalities required as per proviso to sub-rule (4) of Rule 22 of the CGST Rules, 2017.

6. As per Section 29(2)(c), an officer, duly empowered, may cancel the GST registration of a person from such date, including any retrospective date, as he deems fit, where any registered person, has not furnished returns for a continuous period of 6 (six) months. Rule 22 of the CGST Rules, 2017 has laid down the procedure for cancellation of the registration.

7. Rule 22 of the CGST Rules, 2017 being bone of contention is quoted herein below:- Rule 22 : Cancellation of Registration (1) Where the proper officer has reasons to believe that the registration of a person is liable to be cancelled under Section 29, he shall issue a notice to such person in FORM GST REG-17, requiring him to show cause, within a period of seven working days from the date of the service of such notice, as to why his registration shall not be cancelled. Page No.# 4/6 (2) The reply to the show cause notice issued under sub-rule [1] shall be furnished in FORM REG-18 within the period specified in the said sub- rule. (3) Where a person who has submitted an application for cancellation of his registration is no longer liable to be registered or his registration is liable to be cancelled, the proper officer shall issue an order in FORM GST REG-19, within a period of thirty days from the date of application submitted under Rule 20 or, as the case may be, the date of the reply to the show cause issued under sub-rule (1), (or under sub-rule (2A) of Rule 21A) cancel the registration, with effect from a date to be determined by him and notify the taxable person, directing him to pay arrears of any tax, interest or penalty including the amount liable to be paid under sub-section (5) of Section 29. (4) Where the reply furnished under sub-rule (2) (or in response to the notice issued under sub-rule (2A) of Rule 21A) is found to be satisfactory, the proper officer shall drop the proceedings and pass an order in FORM GST REG-20 : Provided that where the person instead of replying to the notice served under sub rule (1) for contravention of the provisions contained in Clause (b) or Clause (c) of sub-section (2) of section 29, furnishes all the pending returns and makes full payment of the tax dues along with applicable interest and late fee, the proper officer shall drop the proceedings and pass an order in FORM GST REG-20. (5) The provisions of sub-rule (3) shall, mutatis mutandis, apply to the legal heirs of a deceased proprietor, as if the application had been submitted by the proprietor himself.

8. It is discernible from a reading of the proviso to sub-rule (4) of Rule 22 of the CGST Rules 2017 that if a person, who has been served with a show cause notice under Section 29(2)(c) of the CGST Act, 2017, is ready and willing to furnish all the pending Page No.# 5/6 returns and to make full payment of the tax itself along with applicable interest and late fee, the officer, duly empowered, can drop the proceedings and pass an order in the prescribed Form i.e. Form GST REG-20.

9. The learned counsel for the parties have also referred to an Order dated

11.10.2023 passed in a writ petition being WP(C) No. 6366/2023 (Sanjoy Nath vs. The Union of India and others) wherein the petitioner therein was similarly situated like the present petitioner.

10. Having regard to the fact that the GST registration of the petitioner has been cancelled under Section 29(2)(c) of the CGST Act, 2017 for the reason that the petitioner did not submit returns for a period of 6 (six) months and more and the provisions contained in the proviso to sub-rule (4) of Rule 22 of the CGST Rules, 2017 and cancellation of registration entails serious civil consequences, this Court is of the considered view that in the event the petitioner approaches the officer, duly empowered, by furnishing all the pending returns and make full payment of the tax dues, along with applicable interest and late fee, the officer duly empowered, has the authority and jurisdiction to drop the proceedings and pass an order in the prescribed Form.

11. In such view of the matter, this writ petition is disposed of by providing that the petitioner shall approach the concerned authority within a period of 2 (two) months from today seeking restoration of his GST registration. If the petitioner submits such an application and complies with all the requirements as provided in the proviso to sub-rule (4) of Rule 22 of the CGST Rules, 2017, the concerned authority shall consider the application of the petitioner for restoration of his GST registration in accordance with law and shall take necessary steps for restoration of GST registration of the petitioner as expeditiously as possible.

12. With the observations made and the direction given above, the writ petition is disposed of. No cost.

13. It is needless to say that the period as stipulated under Section 73 (10) of the Central GST Act/State GST Act shall be computed from the date of the instant order, except for the financial year 2024-25, which shall be as per Section 44 of the Central GST Act/State GST Act. The petitioner herein also be liable to make payment of arrears i.e. tax, penalty, interest and late fees. Page No.# 6/6 JUDGE Comparing Assistant