High Court · 2025

Judgment

1. Deputy State Tax Officer, O/o Assistant Commissioner (State Taxes), Rajenihanagar-1 Cirdle, Saroomagar Division, Telangana.

2. Appetlate Joint Hyderabad. Commissioner (ST) (FAC), Secunderabad Division,

3. State of Telangana, rep. by its Secretary to Govemment (Revenue), Commercial Taxes Department, Secretariat, Hyderabad. ...RESPONDENTS

Petition under Article 226 of the Constitution of lndia praying that in the circumstances stated in the affidavit filed therewith, the High Court may be pleased to issue a Writ of Mandamus or any other appropriate writ or order or direction declaring the action of the l st Respondent in cancelling the GST registration certificate of the petitioner vide GST No. 36DQSPG6583F1ZA. as illegal, arbitrary, contrary to law laid down by this Honourable Court and in @ntravention of fundamental right to carry business under Article 19(1Xg) of the Constitution of lndia, and against the provisions of the Central Goods and Service Tax Act, 2O17 and the Telangana Goods and Services Tax Act' 2017 and consequently set-aside the order for cancellation of Registration dated 261812o24 of the 1st Respondent and the appeal order datd 1011012025 of the 2nd Respondent, lA NO: 1 oF 2025 Petition under Section 151 CPC praying that in the circumstances stated in the affidavit filed in support of the petition, the High Court may be pleased. to suspend the orders of lst and 2nd Respondents dated 26tBt2oz4 and 1ot1ot2o25 and consequently direct the 1st Respondent to Revive the GST Registration portal of the petitioner GST No.36DQSpc6S83FlZA, cr:nding disposal of the above writ Fetition as othenivise the Petitioner will be put to severe loss and hardship. Counsel for the Petitioner: SRI K.P.AMARNATH REDDY Counsel forthe Respondents: SRI SWAROOP OORlLur" SPL. GP FOR STATE TA)( The Court made the following: ORDER THE HON'B LE SRI JUSTICE P.SAM KOSHY AND THE HON ,BLE SRI JUSTICE UDDALA CHALAPATHI RAO WRIT P TION No.32295 ol 2025 ORDER: (per the Hon'bte sri lustxe P.san Koshy) Heard Mr. K.P. Amarnath Reddy, learned counsel for the petitioner; and Mr. Swaroop Oorilla, learned Special Government Pleader for State Tax for the respondents.

2. The instant writ petition has been filed by the petitioner under Article 226 of the Constitution of India assailing the order dated 26.08.2024, (Annextrre P-3) passed the respondent No.1, whereby the GST registration of the petitioner stood cancelled w.e.f. L2.O7.2023 on the ground of alleged violation of Rule 21(d) and Rule 10A (Bank details). The petitioner has also challenged the order dated 10.10.2025, (Annexure P5) passed by respondent No.2, whereby the appeal prefurred by the petitioner against cancellation of GST registration also stood rejected.

3. The facG of the case are that the petitioner is a propriety concern engaged in the business of works contract. The petitioner got itself registered with GSTN No.36DQSPG6583F1ZA t under the GST Act. The petitioner was issued v/ith a registration certificate on 12.07 .2023, based on which fl- e petitioner was carrying on his business. However, because of flre. loss incurred by the petitioner in business, he could not carnr on the business to its fullest extent till the year 2024. Subsequently, upon arranging certain funds from his close associates and friends, the petitioner again intended to carry on the business. It was then in July, 2025, that the petitioner was informed by respondent No.1 about his GST registration (t€:tting cancelled and when he enquired from the GST portal it lvas leamt that a show cause notice was initially issued on O1.rl:1.2024 alleging violation of Rule 21(d) and Rule 10A (Bank Detail:;). According to the petitioner, the registration got cancelled on account of the petitioner not furnishing the bank account rletails with the Department, which was prirnarily on account c f ignorance and not having full knowledge so far as the requisiter compliance is concerned and the consultant who had assisted him in obtaining registration certificate also did not rnake hinr aware of the formalities and compliances those are required t:o be done. In order to make good the default, the petition€lr immediately . approached the Appellate Authority i.e. respondent No.2 on 26-.07 .2025 along with a condone delay petition. However, the respondent No.2 without properly appreciating H-e factual matrix oF the case and the ground under which the condonation of delay was sought, in a mechanical manner rejected the appeal on the ground of it being beyond the condonation of delay prescribed under Section to7(l) and Section tO7(4) of the CGST Act.

4. Learned counsel for the petitioner, at the outset, contended that the lapse on the part of the petitioner in not timely uploading the bank account details was neither deliberate nor with any mala fides and with an intention to take any added advantage. But because of being totally ignorant of the same and unaware of the requirement and unaware of the consequdnces. According to the learned counsel for the petitioner, the petitioner had also preferred a fresh revocation application, however the GST portal did not permit the petitioner to file a fresh revocation application.

5. Learned counsel for the petitioner submits that in order to survive and revive the business, requirement of restoration of GST registration has become necessary and the petitioner is also in the process of getting certain works contract and for which reason also, the restoration of GST registration has become must. Learned counsel for the petitioner further submits that, let the Department again permit the petitioner to make good the \\ \ "\ default by paying whatever fine or penalty that is required to be paid, enabling the petitioner to restore his GST r-ergistration.

6. Per cofltra, the learned Special Governrnent pleader for State Tax contended that after obtaining the GST registration, the petitioner did not make good the requisitr: formalities and periodical updates that are required and also did not care to upload the bank account details.

7. lt was also contended by the learned Spt:cial Government Pleader for State Tax that even after issuance of the show cause notice, the petitioner did not care to respond frtr the same, ndr did he submit any explanation and in. process the Department had no other option but to cancel the registrati,ln on account of continuous unattended default.

8. Having heard the contentions put forth on either side and on perusal of records, what is relevant to be c.onsidered is the fact that the petitioner got hirnself registered with GST Department only on ll.O7.2OZ3. The show cause nofice for the default was one which was issued'on 01.03.211.14. Thus, from the aforesaid factua[ matrix itself it is evidenuy clear that the petitioner did not run the business effectively or smoothly for a loftg period of time with the so-called default cl. not providing bank acount details. What is also necessary to appreciate is the contention of the petitioner. that, in between the petitioner underwent great financial loss because of loss suffered in business and on account of which he could not effectively run the business. This all the more added to the default of not making available the bank account details and later on the order of cancellation of GST registration was issued on 26.08.2024.

9. Learned counsel for the petitioner in the course of his arguments had agreed for making good whatever conditions that the Court may impose while directing the Department to restore the GST registration of the petitioner.

10. What we need to understand is that the only deficiency on the part of the petitioner seems to be not uploading the bank account details, which may not be so grave a deficiency entailing cancellation of GST registration. Another.aspect which needs to be looked into is that the show cause notice issued was as vague as it can be, since it did not disclose the specific shortcomings or default on the part of the petitioner aM neither was it calling upon the petitioner to make good the deficiency within any stipulated period of time. There is also no proof oF the Department having effectively served the show cause notice and impugned order of cancel.lation oF registration upon the t. 1 \ petitioner, except for the contention of having sent it by postal receipt.

11. Another aspect which needs to be appre:iated is the fact that cancelling registration of the petitioner by t:;elf is not going to help the State in any manner. More pra,Jtnatic approach would be if the GST registration of the petitioner is restored subject to the petitioner fulfilling ail, the requisite conditions which includes paying of any late fees, fine, penalty or damages for the default that the petitioner had committr:cl. On the other hand, if the petitioner is permitted to get his GST registration restored and is made to pay the fine, penalty and other dues payable to the Department, the sarne will alsc, generate some revenue to the Department and will also simultaneously restore the business activities of the petitioner. Ltnder both the situations, the Department is going to benefrt as they would be getting certain charges by way of fees, fine or penalty. At the same time, the petitioner also would be able to discharEe business. activities and earn some profit. The mor<: the petitioner earns profit, the more the Department also would be getting benefits out of the same. It is also not going to br:nefit either of the parties if the petitioner is not permitted to get his cST registration opened. Whereas, if he resumes his business and ,/ ,/ Page 7 ot 7 revives his GST registration all the stakeholders would be equally benefited, including the petitioner and the Department.

12. Thus, in the larger interests of the economics and also economy of the country the impugned order of GST registration dated 26.08.2024, passed by respondent No.1 is set aside- The petitioner is directed to move appropriate fresh petition before respondent No.1 for reviving the GST registration which already stands cancelled. It is made clear that the revival of GST registration of the petitioner is subject to the petitioner depositing the late fees, fine or penalty.

13. With the aforesaid observations and directions, the instant writ petition stands allowed. L4. As a sequel, miscellaneous petitions pending if any, shall stand closed. However, there shall be no order as to costs. SD/- MED ABDULLAH KHAN SISTANT REGISTRAR //TRUE COPY// I SECTION OFFICER To, 1 I I 1 The Deputy State Tax Officer, O/o Assistant CoInm issioner (State Rajendranagar- 1 Circle, Saroomagar Division, Telangana. Taxes),

2. The Appellate Joint Commissioner (ST) (FAC), Secunderabad Division, Hyderabad.

3. The Secretary to Government (Revenue), Commercial Taxes Department, Secretariat, Hyderabad, State of Telangana.

4. One CC to SRI K.P.AMARNATH REDDY, Advocate [OPUC] 5. Two CCs to SPL. GP FOR STATE TAX, High Court for the State of Telangana at Hyderabad [OUTI

6. Two CD Copies BSR LS HIGH COURT DATED:27110t2O25 ORDER WP.No.3229S of ZO2S ALLOWNG THE WRIT PETITION, WTHOUT COSTS eI. ,\t I Tt{E S t4 ( 'J i rt\ -+ ?5 ilou 6 'rcr+€O. *