Facts of the Case

The petitioner, sole proprietor of 'Hotel Haris' and registered under the CGST/AGST Act, failed to file GST returns for a continuous period of six months. Consequently, a show cause notice dated 06.06.2023 was issued under Section 29(2)(c) of the Act, and, upon non-response, the petitioner's GST registration was cancelled by order dated 19.04.2024 without assigning reasons. The petitioner, citing illness, could not respond in time or access the portal, and by the time he became aware of the cancellation, both the reply period and the statutory 270-day window for filing a revocation application had elapsed. He subsequently updated all pending returns up to April 2024 and discharged the GST dues along with late fees and interest.

Issues Involved

  1. Whether the petitioner could be permitted to seek restoration of his cancelled GST registration despite the statutory 270-day period for filing a revocation application having expired.
  2. How the limitation period under Section 73(10) of the CGST/State GST Act should be computed in such circumstances.

Petitioner's Arguments

  • The petitioner is ready and willing to comply with all formalities required under the proviso to sub-rule (4) of Rule 22 of the CGST Rules, 2017, i.e., filing all pending returns and paying tax dues with interest and late fee.
  • Reliance was placed on an earlier Gauhati High Court order in Sanjoy Nath v. Union of India and others (WP(C) No. 6366/2023), involving a similarly situated petitioner.

Respondent's Arguments

  • No specific opposing contention on facts is recorded; the Department's counsel addressed the applicability of Rule 22 and the statutory scheme for revocation.

Court Order / Findings

  • The Court examined Rule 22 of the CGST Rules, 2017, and noted that the proviso to sub-rule (4) permits the proper officer to drop cancellation proceedings and restore registration where the person furnishes all pending returns and makes full payment of tax dues along with applicable interest and late fee, even after the show cause stage.
  • Given that cancellation of registration entails serious civil consequences, the Court held that if the petitioner approaches the empowered officer with all pending returns and full payment of dues, the officer may consider dropping the proceedings and passing an appropriate restoration order.
  • The writ petition was disposed of directing the petitioner to approach the concerned authority within two months seeking restoration, upon which the authority was directed to consider the application in accordance with law and take steps for restoration as expeditiously as possible.
  • It was clarified that the period stipulated under Section 73(10) of the CGST/State GST Act shall be computed from the date of the instant order (except for FY 2024-25, which shall follow Section 44), and the petitioner would remain liable to pay arrears of tax, penalty, interest and late fees.

Important Clarification

  • Even after the statutory 270-day window for filing a revocation application has lapsed, courts have used the proviso to Rule 22(4) of the CGST Rules to direct authorities to consider restoration of a cancelled registration where the assessee is willing to file all pending returns and clear dues in full, treating cancellation on non-filing grounds as a curable default rather than a permanent bar.
  • Where a court-ordered restoration route is adopted outside the ordinary limitation scheme, it commonly directs that the Section 73(10) limitation period for assessment be recomputed from the date of the court's order, to avoid prejudice to the Department.

Sections Involved

  • Section 29(2)(c), CGST Act, 2017 – empowers cancellation of registration for non-filing of returns for a continuous period of six months.
  • Rule 22, CGST Rules, 2017 – prescribes the procedure for cancellation and the proviso permitting dropping of proceedings on filing of pending returns with full payment.
  • Section 73(10), CGST Act, 2017 – limitation period for adjudication, directed to be computed from the date of the order in this case.

Decision – In Favour of

The petition is disposed of in favour of the Assessee, granting a conditional opportunity to seek restoration of GST registration within two months upon compliance with return-filing and payment obligations.

Case Details

  • Court: Gauhati High Court
  • Case No.: WP(C)/5229/2025
  • CNR: GAHC010202372025
  • Coram: Hon'ble Mr. Justice Sanjay Kumar Medhi
  • Date of Order: 05.09.2025

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