GST Registration Cancelled For Non-Filing Of Returns Can Be Revived On Compliance: Gauhati High Court

The Gauhati High Court has reaffirmed that cancellation of a GST registration for continuous non-filing of returns does not permanently shut the door on restoration, so long as the taxpayer later files all pending returns and clears tax dues along with interest and late fees.

A Single Judge Bench of Justice Sanjay Kumar Medhi observed that even where registration has been cancelled for prolonged non-compliance, the proper GST officer continues to have the authority to revive it upon full compliance.

The court said, “It is discernible from a reading of the proviso to sub-rule (4) of Rule 22 of the CGST Rules 2017 that if a person, who has been served with a show cause notice under Section 29(2)(c) of the CGST Act, 2017, is ready and willing to furnish all the pending returns and to make full payment of the tax itself along with applicable interest and late fee, the officer, duly empowered, can drop the proceedings and pass an order in the prescribed Form, i.e., Form GST REG-20.”

The case concerned Barluit Organic Farmers Producer Company Limited, a Nalbari-based entity whose GST registration was cancelled after it failed to file returns for six continuous months. A show cause notice was issued in October 2024, warning cancellation of GST registration. As no reply was submitted within the stipulated time, the jurisdictional officer cancelled the registration in December 2024.

The company told the court that it was unfamiliar with the GST portal and that miscommunication with its consultant had led to the lapse. Once it became aware of the cancellation, the company filed all pending returns up to September 2024 and cleared the entire tax liability along with interest and late fees.

However, it could not apply for revocation, as it had already crossed the available limitation. Its statutory appeal against the cancellation order was also dismissed on the ground of limitation.

Looking at the legal position, the High Court noted that the rule governing cancellation allows the proceedings to be dropped if the taxpayer clears all pending returns and dues, even in cases of prolonged non-filing.

The bench added that cancellation of GST registration has serious civil consequences, and, for that reason, the provision must be given a beneficial interpretation.

Referring to its earlier ruling in Sanjoy Nath v. Union of India, the court reiterated that the proper officer continues to have the “authority and jurisdiction” to restore the registration once full compliance is shown.

The writ petition was disposed of with a direction to the company to approach the GST authorities within two months, file all pending returns and pay the applicable dues. The department was directed to consider restoration of the registration and pass appropriate orders within 60 days thereafter.