Kerala High Court Supports GST Registration Cancellation in Non-Return Case

• The petitioner has filed a writ petition to challenge the cancellation of their GST registration due to their failure to file returns.

• The petitioner did not file returns from April 2022 to December 2022, which led to a notice for cancellation of their registration.

• Despite receiving a notice to show cause and an opportunity to reply, the petitioner neither replied nor filed the pending returns. Consequently, their registration was canceled in March 2023.

• The petitioner seeks three reliefs in the writ petition: quashing the registration cancellation order (Exhibit P3), removing a condition on the GST site, and keeping the site open for their trading activities.

• The petitioner claims that they have now filed a return in July 2023 and paid the due taxes and interest, suggesting that their registration should be restored. However, the court disagrees with this argument.

• The court explains that the provisions for registration cancellation and the payment of taxes with interest are separate and serve different purposes.

• If a taxpayer fails to make a timely tax payment, interest is imposed. If they fail to file returns for six consecutive months, their registration can be canceled.

• There is no contradiction between these provisions in the GST Act.

• The court emphasizes that the petitioner had an alternative legal remedy, which they should have used within the prescribed time frame. They could have appealed the registration cancellation within three months, but they did not do so.

• The court finds that the authority acted correctly in canceling the petitioner's registration due to their continuous failure to file returns.

• The writ petition is dismissed. However, the petitioner can apply for fresh registration, which will be considered in accordance with the law.

• The court rejects the petitioner's claim that the GST software is not in compliance with the law, noting that the majority of the country uses the same software successfully for filing returns and paying taxes.
  

Sanscorp India (P.) Ltd.

vs.

Assistant Commissioner, Kerala