Facts of the Case

The petitioner, M/s Rohit Kumar, is an individual earning his livelihood as a registered Government Contractor. The GST Department issued an order dated January 21, 2022, canceling the petitioner's GST registration. Aggrieved by this sudden and detrimental cancellation, which directly disrupted his business operations and livelihood, the petitioner moved the Hon’ble High Court of Uttarakhand by filing a Writ Petition (WPMS No. 2718 of 2022) seeking a writ to call for the records and quash the cancellation order.

Issues Involved

  1. Whether the cancellation of the petitioner's GST registration solely due to non-compliance with Rule 10A (failure to update bank details) warrants absolute termination of registration without providing an alternative administrative remedy for revocation.
  2. Whether a petitioner can be directed to approach the proper State Tax Officer for the redressal of grievances and restoration of GST registration upon correcting technical defaults and clearing outstandings, in the absence of an active or accessible appellate forum.

Petitioner’s Arguments

The petitioner, represented by learned counsel Shri Ashish Agarwal and Shri Tarun Pandey, argued that the cancellation of his GST registration had severely impacted his capability to execute government contracts, thereby violating his fundamental right to carry on trade and business. It was contended that the procedural lapse of not updating bank details under Rule 10A was a rectifiable defect rather than a fraudulent evasion of tax. Therefore, an absolute cancellation was disproportionate, and the registration ought to be restored to allow him to continue his livelihood and complete his compliance procedures.

Respondent’s Arguments

The respondents, represented by Shri Mohit Maulekhi, learned Brief Holder for the State of Uttarakhand, strongly supported the department's initial action. It was submitted that the petitioner's GST registration was cancelled entirely due to non-compliance with Rule 10A of the G.S.T. Rules, as the petitioner had failed to update his mandatory bank account details on the GST portal.

However, the State's counsel fairly submitted that while the petitioner had been given an initial opportunity to appear before the Assistant Commissioner (Sales Tax), the standard appellate forum was currently not available for this specific grievance. Consequently, the respondent suggested that the petitioner could directly approach the localized State Tax Officer for the redressal of his grievances.

Court Findings and Order

The matter was heard before the Single Bench of Hon’ble Shri Sanjaya Kumar Mishra, J.. Taking into consideration the submissions of both parties and the lack of an immediate appellate forum, the Hon’ble High Court disposed of the writ petition with the following directions:

  • Liberty to Approach the Officer: The Court granted clear liberty to the petitioner to physically or formally appear before the State Tax Officer, Haldwani.
  • Rectification of Defects: The petitioner was directed to remove all technical defects pointed out by the GST Department, specifically the updating of bank details under Rule 10A.
  • Clearance of Liabilities: The petitioner must clear all outstanding tax dues, interest, or penalties standing against him.
  • Favorable Consideration for Revocation: The Court explicitly ordered that upon the petitioner fulfilling these conditions (defect removal and payment of dues), his prayer for the revocation of the order of cancellation of GST registration shall be considered favorably by the department.
  • The Court further ordered the grant of an urgent certified copy of the order to the parties as per the rules.

Important Clarification

This judgment clarifies that procedural non-compliance—such as failing to upload bank details under Rule 10A—should not permanently strip a taxpayer of their registration if they are willing to rectify the defect. When alternative appellate remedies are bottlenecked or unavailable, taxpayers can approach the High Court under Article 226 to seek a practical pathway toward compliance and registration restoration, provided they clear their outstanding tax dues.

Section Involved

  • Rule 10A of the Central Goods and Services Tax (CGST) / Uttarakhand Goods and Services Tax (UKGST) Rules, 2017: Failure to furnish information relating to bank account details within the prescribed time limit after the grant of registration.
  • Section 30 of the CGST / SGST Act, 2017: Revocation of cancellation of registration.
  • Article 226 of the Constitution of India: Power of High Courts to issue certain writs.

Link to download the order -https://mytaxexpert.co.in/uploads/1783315705_926compressed.pdf

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