Facts of the Case

The petitioner approached the Uttarakhand High Court by filing WPMS No. 1839 of 2022 in relation to cancellation of GST registration and the consequential appellate proceedings.

The petitioner sought quashing of the show cause notice dated 26 August 2019, as well as the GST registration cancellation order dated 4 September 2019. The petitioner specifically expressed readiness to pay the balance tax, interest thereon and late fee, if any.

The petitioner also sought quashing of the order dated 24 July 2021 and requested a direction to respondent no. 3 to hear the petitioner’s appeal after condoning the delay and remanding the matter to the appellate authority.

A further direction was sought for reopening/restoration of the petitioner’s GST registration and permitting the petitioner to submit GST returns, with the petitioner stating readiness to pay the applicable expenses and late fee.

The petitioner relied upon the Division Bench judgment of the same High Court in SPA No. 123 of 2022, decided on 20 June 2022, wherein, as recorded in the present order, the Court had held that the Commissioner is not an adjudicating authority and, therefore, an appeal under Section 107 of the Uttarakhand GST Act, 2017 would not lie to the Commissioner.

Issues Involved

The principal issues arising before the Court were:

  1. Whether the show cause notice dated 26 August 2019 and GST registration cancellation order dated 4 September 2019 warranted interference in writ jurisdiction.
  2. Whether the order dated 24 July 2021 was liable to be quashed.
  3. Whether the petitioner could seek consideration of the appeal after condonation of delay.
  4. Whether an appeal under Section 107 of the Uttarakhand GST Act, 2017 could lie before the Commissioner when, according to the Division Bench ruling relied upon, the Commissioner was not an adjudicating authority.
  5. Whether the petitioner, being willing to clear outstanding GST dues, could be granted an opportunity to seek restoration of the cancelled GST registration.
  6. Whether the competent authority should consider such restoration request liberally after payment of dues and after granting a reasonable opportunity of hearing.

Petitioner’s Arguments

The petitioner, through learned counsel, submitted that the controversy was covered by the Division Bench judgment passed in SPA No. 123 of 2022 on 20 June 2022.

It was argued that the Division Bench had held that the Commissioner is not an adjudicating authority, and consequently an appeal under Section 107 of the Uttarakhand GST Act, 2017 would not lie to the Commissioner.

The petitioner further maintained readiness to pay the balance tax, interest and late fee, if any, and sought restoration/opening of the GST registration so that pending GST returns could be submitted.

The petitioner accordingly sought appropriate relief against the cancellation proceedings and requested an opportunity for restoration of GST registration.

Respondents’ Arguments

The order records the appearance of the learned Deputy Advocate General for the respondents. However, the short order does not separately reproduce or detail any substantive counter-arguments advanced on behalf of the respondents.

Accordingly, no additional respondent contention should be attributed beyond what is expressly recorded in the judicial order.

Court Order / Findings

The Uttarakhand High Court disposed of the writ petition by granting liberty to the petitioner to file an application before the Assistant Commissioner, State GST, Sector 1, Dehradun, Uttarakhand/respondent no. 2, within ten days, ventilating the petitioner’s grievances.

The Court further directed that if the petitioner pays the dues, if any, pending against the petitioner under the GST Act, the application for restoration of GST registration may be considered liberally.

The Court also directed that if such an application is filed, it must be disposed of:

  • by a speaking and reasoned order;
  • after affording a reasonable opportunity of hearing to the petitioner; and
  • within 30 days of the filing of such application.

The pending application was also disposed of.

Important Clarification

This judgment does not record an unconditional or automatic restoration of GST registration. The Court granted liberty to the petitioner to approach the competent Assistant Commissioner within ten days and provided that, upon payment of pending GST dues, if any, the restoration application may be considered liberally.

Therefore, the operative relief was an opportunity for fresh consideration by the competent authority, rather than a direct judicial order restoring the GST registration.

Another significant clarification is that the present order records reliance on the Division Bench ruling in SPA No. 123 of 2022 dated 20 June 2022, according to which the Commissioner is not an adjudicating authority and, therefore, an appeal under Section 107 of the Uttarakhand GST Act, 2017 would not lie to the Commissioner.

The Court also safeguarded procedural fairness by requiring a speaking and reasoned order and a reasonable opportunity of hearing before disposal of the restoration request.

Sections Involved

Section 107 of the Uttarakhand Goods and Services Tax Act, 2017 – Appeal to Appellate Authority.

The case also concerns the broader statutory framework governing cancellation and restoration of GST registration, payment of pending tax dues, interest and late fee. However, the supplied order expressly refers to Section 107, and it does not expressly identify any other specific statutory section in its text

Link to download the order -https://mytaxexpert.co.in/uploads/1783416601_1363compressed.pdf

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