Facts of the Case

The petitioner Mamundy's GST registration was cancelled by the Commercial Tax Officer, Ponmalai, Trichy, vide an order bearing Reference No. ZA330924301742Q dated 26.09.2024. Aggrieved, the petitioner filed a writ petition under Article 226 before the Madurai Bench of the Madras High Court seeking a Writ of Certiorarified Mandamus quashing the cancellation. Counsel on both sides agreed that the issue was squarely covered by the Madras High Court's earlier decision in Tvl. Suguna Cutpiece Center vs. Appellate Deputy Commissioner (ST) (GST) and others, a batch of writ petitions decided on 31.01.2022, which laid down a standard conditional-restoration formula for cancelled GST registrations.

Issues Involved

  1. Whether the cancellation of a GST registration should be set aside and the registration restored on the conditions previously laid down in Suguna Cutpiece Center's case.
  2. What safeguards should attach to such restoration to prevent misuse of accumulated Input Tax Credit.

Petitioner's Arguments

  • The cancellation of GST registration deserved to be set aside since the matter was squarely covered by the binding precedent in Suguna Cutpiece Center.
  • The petitioner was willing to comply with the conditions prescribed therein, including filing pending returns and paying defaulted tax, interest and fees.

Respondent's Arguments

  • The Additional Government Pleader agreed that the case fell squarely within the ambit of Suguna Cutpiece Center and did not oppose conditional restoration of the registration.

Court Order / Findings

  • Noting the concurrence of both counsel, the Court reproduced the detailed conditions laid down in Suguna Cutpiece Center — filing of pending returns with defaulted tax, interest, fine and late fee within 45 days; a bar on adjusting such dues against unutilised Input Tax Credit; scrutiny and departmental approval before any accumulated ITC can be utilised; payment of GST in cash for the period after cancellation until registration is restored; and revival of registration upon compliance.
  • The impugned cancellation order was set aside and the respondent was directed to restore the petitioner's GST registration subject to compliance with the Suguna Cutpiece Center conditions.
  • The writ petition was disposed of with no costs, and the connected miscellaneous petition was closed.

Important Clarification

  • The Suguna Cutpiece Center formula continues to be the standard template applied for restoring cancelled GST registrations across Tamil Nadu, including by the Madurai Bench.
  • Restoration is never unconditional: it requires clearing defaulted returns, tax, interest and fees, with accumulated ITC frozen until departmental scrutiny and approval.
  • Post-cancellation GST liability must be discharged in cash until the registration stands revived, ensuring revenue is protected while giving cancelled taxpayers a structured path back into the GST system.

Sections Involved

  • Section 29(2), CGST Act, 2017 — empowers cancellation of GST registration for specified defaults, such as non-filing of returns.
  • Section 30, CGST Act, 2017 — provides for revocation of cancellation of registration on an application by the registered person.
  • Rule 23, CGST Rules, 2017 — procedure for revocation of cancellation of registration.

Decision – In Favour of

The decision is in favour of the assessee. The cancellation order was set aside and registration ordered to be restored, subject to compliance with the Suguna Cutpiece Center conditions.

Case Details

Court: Madurai Bench of Madras High Court
Case No.: W.P.(MD) No.30023 of 2025 and W.M.P.(MD) No.23209 of 2025
Coram: Hon'ble Mr. Justice G.R. Swaminathan
Date of Order: 27.10.2025

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