Ishwar Chand Proprietor of Bhagwati Trading Co. v. Union of India – [2023] (Delhi)
For more than six months, the petitioner had not submitted any GST returns. The petitioner didn’t reply to the Show Cause Notice that the department issued, although it did submit GST returns. However, the government issued an order on July 29, 2020, cancelling the petitioner’s GST registration.
On October 16, 2020, it submitted an application for the cancellation of registration but the request was denied. Following that, it appealed the decision, and the appellate body ordered that the petitioner’s GSTIN registration be reinstated. The registration was reinstated on April 22, 2022, and a petition was filed to challenge the imposition of a late filing penalty.
The Honorable High Court noted that although the Appellate Authority ultimately approved the revocation of cancellation application, registration was not immediately reinstated. The Court further stated that the petitioner could not be held accountable for failing to file returns during the time that its registration was suspended from the date that the application for revocation of the cancellation was filed.
As a result, the Court concluded that any penalties for filing returns late would not be calculated for the time period from 16 October 2020 to 22 April 2022, when the petitioner’s registration was reinstated.
