Jharkhand High Court Refuses To Quash GST Registration Cancellation Order For Not Complying With GST REG-17/31

The Jharkhand High Court has  refused to quash Goods and Service Tax (GST) registration cancellation order for not complying with GST REG-17/31.

Under GST, a taxpayer and a proper officer can initiate the cancellation of GST registration. If a proper officer has reasons to initiate the cancellation of a registration, he can start the cancellation proceedings by issuing a show-cause notice in Form GST REG-17.  Taxpayer Registration would get suspended after 30 days and intimation in FORM REG-31 will be issued to the Taxpayer.

The bench of Chief Justice M. S. Ramachandra Rao and Justice Deepak Roshan has observed that the Petitioner- Firm is not entitled for any relief on the ground of delay and latches coupled with the fact of being lethargic in approach; inasmuch as, on the one hand, the petitioner did not file return regularly and thus has not complied with GST REG-17/31 issued to him in any manner; and on the other hand, the appellant filed appeal after delay of more than one year and three months which is admittedly beyond the period of limitation as per the GST Act.

The petitioner, M.N. Ghosh & Sons is a partnership firm which carries on the business of civil construction work and labour supply. Upon the advent of the GST regime, the Petitioner obtained registration under the CGST Act.

A notice was issued to the petitioner in Form GST REG-17/31 requiring the petitioner to show-cause as to why its registration ought not to be cancelled for failure to file returns for a continuous period of six months. The petitioner was directed to appear before department and informed that its registration had been suspended with effect from 28.01.2022. The registration of the petitioner-Firm was cancelled by the department with effect from 28.02.2022.

The petitioner was left with no option but to file an appeal under Section 107 of the CGST Act which was registered as Appeal. The appeal of the Petitioner was dismissed on the ground of time barred as prescribed under Section 107 of the CGST Act.

The petitioner contended that the active partner of the petitioner-Firm used to look after its day-to-day activities. However, due to severe health issues he could not furnish a reply to the show-cause notice in time or appear before the department. Though the order states that Petitioner has allegedly submitted a reply on 08.02.2022, which it did not, the reason for cancellation has been stated as “not responding in the matter.

The department contended that there is no error in the impugned order and this Court in catena of judgments has held that limitation cannot be condoned by the appellate authority beyond the period that has already been stipulated in Section 107 of the CGST Act. 

The court noted that order for cancellation of registration with effect from 28.02.2022 under Section 29(2)(c) of the CGST Act, 2017 was issued on 08.07.2022 and the Petitioner had filed an appeal under Section 107 of the CGST Act, which is the appellate provision on 29.09.2023 through online and hard copy of the same was submitted in the office of the appellate authority on 06.10.2023; as such, after calculating the entire period, it appears that the appeal has been filed after one year and three months beyond the normal period of filing of appeal as prescribed under Section 107 (1) of the CGST Act, 2017.

The court while dismissing the application held that neither there is any perversity in the order of cancellation of GST registration; nor there is any necessity for interference with the appellate order, inasmuch as, the same has been filed beyond the statutory period of limitation.

Case Details

Case Title: M.N. Ghosh & Sons Versus Principal Commissioner, Central Goods & Services Tax & Central Excise, Jamshedpur

Case No.: W.P.(T) No. 3408 of 2024

Date: 25/04/2025

Counsel For Petitioner: M. S. Mittal, Sr. Advocate

Counsel For Respondent: P. A. S. Pati, Advocate

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