Facts of the Case

The petitioner, M/S Eves Fashion, engaged in manufacturing and resale of garments, had its GST registration bearing No. 07AACPA0807D1ZM cancelled on 22nd October, 2021 for failure to file returns for six months, after a show cause notice dated 2nd September, 2021 went unanswered. The petitioner explained that he fell seriously ill during COVID-19 and, on recovery, discovered his Chartered Accountant had neither filed returns nor handed over portal credentials despite repeated representations from December 2021 onward; a new password provided only in March 2023 allowed limited access. His appeal, filed after over three years, was dismissed as time-barred, prompting this writ petition before the Delhi High Court seeking restoration of registration.

Issues Involved

  1. Whether a GST registration cancelled over three years earlier for non-filing of returns can still be restored despite gross delay in seeking revocation and a time-barred appeal.
  2. Whether medical incapacity combined with a dispute over portal credentials with the taxpayer's Chartered Accountant constitutes sufficient cause to exercise writ jurisdiction despite laches.
  3. What conditions should attach to restoration to protect revenue and ensure regularisation of the intervening period.

Petitioner's Arguments

  • The petitioner had made repeated written representations to the GST Department from December 2021 through 2024 seeking portal access, but was given only limited access even after receiving new credentials in March 2023.
  • Serious illness during COVID-19, compounded by the Chartered Accountant's failure to file returns and withholding of login credentials, constituted a bona fide, compelling reason for the default, not wilful non-compliance.
  • The petitioner was a bona fide trader engaged in garment exports who intended to continue business and was willing to file all pending returns with late fee and interest if the registration were restored.

Respondent's Arguments

  • The Department's counsel relied on the decision in M/s Addichem Speciality LLP v. Special Commissioner I, Department of Trade and Taxes, submitting that the appeal had been rightly dismissed as time-barred and that the petitioner was guilty of laches, so the writ was not liable to be entertained.

Court Order / Findings

  • The Court acknowledged that ordinarily it would not condone such prolonged delay, but found the present case presented a peculiar set of facts, given the petitioner's medical circumstances and the dispute with his Chartered Accountant, warranting exercise of writ jurisdiction to restore a bona fide trader's ability to continue business.
  • Where prolonged non-compliance leading to GST registration cancellation is attributable to genuine medical incapacity coupled with a professional-agent dispute over portal access, rather than wilful default, courts may restore registration in the interest of enabling a bona fide business to continue, even beyond the ordinary limitation and laches thresholds.
  • Registration was directed to be restored within a week, with fresh username and password to be issued, enabling the petitioner to file all pending GST returns along with late fee and interest, failing which physical filing was to be permitted, and access to the electronic credit ledger enabled thereafter.
  • The Department was left at liberty to scrutinise the returns and take any lawful action for discrepancies, and normal time limits for issuing any consequential SCN were relaxed given the belated filing permitted by the Court.

Important Clarification

  • Extreme, fact-specific compassionate circumstances, such as serious illness combined with a professional's failure or refusal to hand over portal access, can persuade courts to restore a long-cancelled GST registration despite gross delay that would ordinarily defeat the claim.
  • Such restoration is invariably conditioned on the taxpayer filing all pending returns with late fee and interest, preserving the Department's revenue interest even while extending equitable relief.
  • Courts caution that such relief rests on the specific peculiar facts and is not intended to dilute the general rule that delay and laches ordinarily bar revival of long-cancelled registrations.

Sections Involved

  • Section 29, CGST Act, 2017 – governs cancellation of GST registration for non-filing of returns.
  • Section 107, CGST Act, 2017 – prescribes limitation for appeal against cancellation, found to bar the petitioner's appeal here.
  • Section 39, CGST Act, 2017 – requires periodic filing of returns, the default that triggered cancellation.

Decision – In Favour of

The decision favours the assessee. Despite the time-barred appeal and prolonged delay, the Court restored the GST registration on compassionate grounds, subject to the petitioner filing all pending returns with interest and late fee.

Case Details

High Court of Delhi at New Delhi; W.P.(C) 17991/2025 and CM APPL. 74400/2025; M/S Eves Fashion vs Union of India and Others; Coram: Justice Prathiba M. Singh and Justice Mini Pushkarna; Decided on 27.11.2025.

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