Full Text
HIGH COURT OF DELHI
,,,,,,,,,, W.P.(C) 1557/2024 KWATRA AUTO INDUSTRIES THROUGH ITS PROPRIETOR
YOGESH KUMAR MAL
COMMISSIONER OF DELHI GOODS AND SERVICES TAX ACT
& ANR Advocates who appeared in this case:
For the Petitioner:
For the Respondent:
JUDGMENT
1. Petitioner impugns Order in Appeal dated 03.01.2024 appeal filed by the Petitioner has been dismissed solely on the ground of limitation.
2. Petitioner filed the appeal impugning order of cancellation registration dated 25.11.2019 whereby the GST registration of the Petitioner was cancelled retr Petitioner also impugns show cause notice dated 14.11.2019.
IN THE HIGH COURT OF DELHI AT
NEW DELHI Date of decision: KWATRA AUTO INDUSTRIES THROUGH ITS PROPRIETOR YOGESH KUMAR MAL..... Petitioner versus COMMISSIONER OF DELHI GOODS AND SERVICES TAX ACT..... Respondents Advocates who appeared in this case: Mr. M. A. Ansari, Mr. Khursheed Ahmad, Mr. Arvind KumarSoni, Mohd Kamil & Ansari, Advocates. For the Respondent: Ms. Shaguftha, Advocate. HON’BLE MR.
JUSTICE SANJEEV SACHDEVA JUSTICE RAVINDER DUDEJA
JUDGMENT
SANJEEV SACHDEVA, J. (ORAL) Petitioner impugns Order in Appeal dated 03.01.2024 Petitioner filed the appeal impugning order of cancellation etitioner was cancelled retrospectively with effect from 01.07.2017 impugns show cause notice dated 14.11.2019.
IN THE HIGH COURT OF DELHI AT
NEW DELHI Date of decision: 02.02.2024 KWATRA AUTO INDUSTRIES THROUGH ITS PROPRIETOR..... Petitioner COMMISSIONER OF DELHI GOODS AND SERVICES TAX ACT..... Respondents Mr. M. A. Ansari, Mr. Khursheed Ahmad, Mr. Arvind KumarSoni, Mohd Kamil & Mr. Ahmad Petitioner impugns Order in Appeal dated 03.01.2024 whereby the Petitioner filed the appeal impugning order of cancellation ospectively with effect from 01.07.2017. impugns show cause notice dated 14.11.2019.
3. Vide show c upon to show cause as to why the registration be following reasons “Taxpayer found Non Place of Business”
4. Petitioner, a proprietorship concern with trade name “M/s Kwatra Auto Industries having No.13 NALA Side Vishwas Nagar in business of trading in parts and accessories of Motor Vehicle
5. The show cause notice merely states “taxpayer found non place of business merely stated that “ submitted” and 01.07.2017 i.e. with
6. The Show Cause Notice and the Petitioner to notice that the registration is liable to be cancelled retrospectively. Accordingly, petitioner had no opportunity to even object to the retrospective cancellation of the registration.
7. It was brought to the notice of the Court that from DVAT to CGST Act after the commencement of GST Act, whereby the petitioner had uploaded the rent agreement at GST Portal for the Principal Place of business 25/20 Gali No Vide show cause notice dated 14.11.2019, Petitioner was called upon to show cause as to why the registration be not cancelled for the following reasons:- “Taxpayer found Non-Functioning/Not Existing at the Principal Place of Business”. Petitioner, a proprietorship concern with trade name “M/s Kwatra having the principal place of business No.13 NALA Side Vishwas Nagar Shahdra Delhi-110032 in business of trading in parts and accessories of Motor Vehicle show cause notice issued to the Petitioner taxpayer found non-functioning/non-existing at principal place of business”. Further, the impugned order dated 25.11.2019 merely stated that “No reply to the show cause notice has been the effective date of cancellation of registration is with retrospective effect. The Show Cause Notice and the Impugned Order do It was brought to the notice of the Court that Petitioner migrated for the Principal Place of business 25/20 Gali No.16 etitioner was called cancelled for the Functioning/Not Existing at the Principal Petitioner, a proprietorship concern with trade name “M/s Kwatra place of business at 28/126,Gali 110032 was engaged in business of trading in parts and accessories of Motor Vehicles. ssued to the Petitioner on 14.11.2019 existing at principal Further, the impugned order dated 25.11.2019 No reply to the show cause notice has been the effective date of cancellation of registration is Impugned Order do not put the Petitioner migrated Vishwas Nagar, Shahdara -110032 entered the old address of the principal office. Petitioner was conducting business at his principal place of business 25/20 Gali No Vishwas Nagar, Shahdara
8. Learned Counsel for the p filed the last GSTR and has shut the business w.e.f 01.10.2019
9. In terms of Section 29(2) of the Central Goods and Act, 2017, the proper officer may cancel the GST registration of a person from such date including any retrospective date, as he may deem fit if the circumstances set out in the said sub Registration cannot be cancelled It can be cancelled only if the proper officer deems it fit to do so. Such satisfaction cannot be subjective but must be based on some objective criteria. Merely, because a taxpayer has not filed the returns for some period does not mean that the taxpayer’s registration is required to be cancelled with retrospective date also covering the period when the returns were filed
10. It is important to note that, according to the respondent, o the consequences for cancelling a tax payer’s registration with retrospective effect is that the taxpayer’s customers are denied the input tax credit availed in respect of the supplies made by the tax payer during such period. Although, we do not con
110032. But inadvertently the account for the petitioner conducting business at his principal place of business 25/20 Gali No Vishwas Nagar, Shahdara -110032 vide registered rent agreement. Counsel for the petitioner submits that the petitioner filed the last GSTR-3B return output tax liability for September 2019 shut the business w.e.f 01.10.2019. In terms of Section 29(2) of the Central Goods and fit if the circumstances set out in the said sub-section are satisfied. Registration cannot be cancelled with retrospective effect mechanically. returns were filed and the taxpayer was compliant. It is important to note that, according to the respondent, o during such period. Although, we do not consider it apposite to. But inadvertently the account for the petitioner conducting business at his principal place of business 25/20 Gali No.16 rent agreement. that the petitioner had 3B return output tax liability for September 2019 In terms of Section 29(2) of the Central Goods and Services Tax section are satisfied. with retrospective effect mechanically. It is important to note that, according to the respondent, one of sider it apposite to examine this aspect but assuming that the respondent’s contention in this regard is correct, it would follow that the proper officer is also required to consider this aspect while passing any order for cancellation of GST registration registration can be cancelled with retrospective effect only where such consequences are intended and are warranted
11. In view of the above, cancellation is modified to t effect from 01.10.2019, i.e. the date business was shut down.
12. It is clarified that respondents are also not precluded from taking any steps for recovery of any tax, penalty or interest that may be due from the petitioner in accordance with law.
13. Petition is accordingly disposed of in the above terms FEBRUARY 02 of GST registration with retrospective effect. Thus, a taxpayer’s consequences are intended and are warranted. In view of the above, facts and circumstances, cancellation is modified to the extent that the same shall operate with It is clarified that respondents are also not precluded from taking recovery of any tax, penalty or interest that may be due petitioner in accordance with law. etition is accordingly disposed of in the above terms SANJEEV SACHDEVA, J RAVINDER DUDEJA 02, 2024/sk with retrospective effect. Thus, a taxpayer’s facts and circumstances, the order of he extent that the same shall operate with It is clarified that respondents are also not precluded from taking recovery of any tax, penalty or interest that may be due etition is accordingly disposed of in the above terms.
SANJEEV SACHDEVA, J RAVINDER DUDEJA, J