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Case Summary: Sri Suvarna Enterprises vs. The
Superintendent of Central Tax
Case Name: Sri Suvarna Enterprises vs. The Superintendent of Central Tax
W.P. No.: 25464 of 2023
Court: High Court of Karnataka
Date of
Order: April 23, 2024
Facts of
the Case:
The
petitioner, Sri Suvarna Enterprises, a proprietorship represented by its
proprietor, Sri Chandra Kiran Paichur Narayana, aged 37, faced cancellation of
its GST registration. This was due to non-submission of GST returns for a
continuous period of six months. The reason cited for this failure was that the
petitioner's email ID was inoperative, which prevented them from submitting the
returns.
A show
cause notice was issued on December 9, 2022, and an order of cancellation was
passed on January 10, 2023. Aggrieved by this order, the petitioner filed a
statutory appeal which was dismissed as barred by limitation since it was filed
beyond the prescribed period of four months.
Submission
by the Petitioner:
The
petitioner's counsel argued that the non-submission of returns was due to bona
fide reasons and unavoidable circumstances. The counsel also stated that the
petitioner was ready to pay the pending tax amount along with interest, subject
to the availment of Input Tax Credit. The petitioner sought the quashing of the
cancellation order and a direction to the respondent to revoke the cancellation
of the GST registration.
Submission
by the Respondent:
The
respondent's counsel supported the impugned order, asserting that there was no
merit in the petition and that it should be dismissed.
Judgment:
The court
noted that the appeal was dismissed by the Appellate Authority solely on the
grounds of limitation without examining the merits of the petitioner's claim
for revocation of the GST cancellation. The court held that if an appeal is
dismissed as barred by limitation, the original order remains subject to
challenge under Article 226 of the Constitution of India.
Given the
petitioner's readiness to comply with tax obligations and the specific
circumstances presented, the court set aside the impugned order and remitted
the matter back to the respondent for reconsideration, providing the petitioner
with an opportunity to rectify the non-compliance.
Order:
1. The
petition is allowed.
2. The
impugned order dated January 10, 2023, is set aside.
3. The
matter is remitted back to the respondent for reconsideration.
4. The
petitioner is to file necessary pleadings and documents.
5. The
respondent is directed to provide a reasonable opportunity to the petitioner
and pass appropriate orders within three months from May 13, 2023.
Summary:
In the case
of Sri Suvarna Enterprises vs. The Superintendent of Central Tax, the Karnataka
High Court set aside the cancellation of the petitioner's GST registration. The
court recognized the petitioner's claim of unavoidable circumstances leading to
non-compliance and remitted the matter back to the tax authorities for
reconsideration, allowing the petitioner to rectify the compliance issues.
Disclaimer: All the
Information is based on the notification, circular and order issued by the
Govt. authority and judgement delivered by the court or the
authority information is strictly for educational purposes and on the
basis of our best understanding of laws & not binding on anyone.
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