GST Vidhi | GST Case Law

Registration Cancelled for Non-Filing of Returns – Court Allows Fresh Opportunity under Rule 22(4) of CGST Rules

In a significant judgment reinforcing the principle of natural justice under GST law, the Gauhati High Court, in WP(C)/956/2026, delivered on 20.02.2026 by Hon’ble Mr. Justice Sanjay Kumar Medhi, granted relief to a taxpayer whose GST registration was cancelled due to non-filing of returns. The Court permitted the petitioner to approach the authorities for restoration of registration upon compliance with statutory requirements.

This decision highlights the importance of the proviso to Rule 22(4) of the CGST Rules, 2017 and reiterates that cancellation of GST registration has serious civil consequences.

Case Details

• Case Name: Mrs. Bobismrita Chetia Gogoi vs. Union of India & Ors.
• Case No.: WP(C)/956/2026
• Court: Gauhati High Court
• Date of Judgment: 20 February 2026
• Coram: Hon’ble Mr. Justice Sanjay Kumar Medhi

 

Facts of the Case

The petitioner, Mrs. Bobismrita Chetia Gogoi, was carrying on business under the name and style of M/s Poly Enterprise. She was a sole proprietor registered under the CGST and AGST Acts.

Due to non-filing of GST returns for a continuous period of six months, a show cause notice dated 07.10.2024 was issued under Section 29(2)(c) of the CGST Act. The notice required her to submit a reply within 30 days, failing which the case would be decided ex parte.

Since no reply was filed, the Superintendent, Dibrugarh-I Range, passed an order dated 11.11.2024 cancelling her GST registration.

Reason for Non-Compliance

The petitioner contended that due to miscommunication with her tax consultant, she was unaware of the show cause notice. By the time she became aware, the time for filing reply had already expired and the cancellation order had been uploaded on the GST portal.

Subsequently, she:

• Filed all pending returns up to November 2024
• Paid all GST dues
• Paid applicable interest and late fees

However, when she attempted to file an application for revocation of cancellation, the GST portal displayed that the 270-day timeline for filing revocation had expired.

Aggrieved by the inability to seek revocation through the portal, she approached the High Court by filing a writ petition.

Legal Provisions Involved

Section 29(2)(c) of the CGST Act, 2017

This provision empowers the proper officer to cancel registration if a registered person fails to furnish returns for a continuous period of six months.

Rule 22 of the CGST Rules, 2017

Rule 22 prescribes the procedure for cancellation of registration.

Of particular importance is the Proviso to Rule 22(4), which provides that:

If a person, instead of replying to the show cause notice, furnishes all pending returns and makes full payment of tax dues along with applicable interest and late fee, the proper officer shall drop the proceedings and pass an order in FORM GST REG-20.

This proviso formed the central issue in the present case.

Petitioner’s Submission

The petitioner submitted that:

• She has already furnished all pending returns.
• All tax liabilities along with interest and late fees have been paid.
• She is ready to comply with all formalities under Rule 22(4).
• Cancellation of registration causes serious civil consequences and affects business operations.

The petitioner relied upon an earlier decision of the High Court in WP(C) No. 6366/2023 (Sanjoy Nath vs Union of India & Ors.), where similar relief was granted.

Respondent’s Stand

The Standing Counsel for CGST submitted that:

• There was delay in approaching the Court.
• Any order passed should not be treated as a precedent.

Observations of the Court

The Court examined:

• Section 29(2)(c) of the CGST Act
• Rule 22 of the CGST Rules, 2017
• Particularly the proviso to Rule 22(4)

The Court observed that:

• Cancellation of GST registration entails serious civil consequences.
• The law itself provides a mechanism for dropping proceedings if pending returns are furnished and dues are paid.
• The petitioner has already updated returns and discharged liabilities.

The Court found that the proviso to Rule 22(4) clearly enables restoration where compliance is made.

Decision of the Court

The High Court disposed of the writ petition with the following directions:

1.    The petitioner shall approach the concerned authority within two months seeking restoration of GST registration.

2.    If the petitioner complies with the requirements under the proviso to Rule 22(4), the proper officer shall consider restoration in accordance with law.

3.    The authority shall take necessary steps for restoration expeditiously.

4.    The petitioner shall remain liable to pay arrears of tax, interest, penalty and late fee.

5.    Limitation under Section 73(10) shall be computed from the date of the High Court’s order (except FY 2024-25, which shall follow Section 44).

The writ petition was disposed of without costs.

Legal Significance of the Judgment

1. Emphasis on Substantive Compliance

The Court prioritised substantive compliance (filing returns and payment of dues) over procedural lapses.

2. Relief Beyond Portal Limitations

Even though the GST portal blocked revocation due to expiry of 270 days, the Court intervened to ensure that statutory rights are not defeated by technical barriers.

3. Recognition of Civil Consequences

Cancellation of GST registration impacts:

• Business continuity
• Input Tax Credit chain
• Commercial reputation
• Contractual obligations

Hence, the Court exercised writ jurisdiction to prevent irreversible hardship.

4. Strengthening Rule 22(4) Proviso

The judgment reinforces that the proviso to Rule 22(4) is a beneficial provision intended to allow genuine taxpayers to regularise defaults.

Conclusion

The decision of the Gauhati High Court in Mrs. Bobismrita Chetia Gogoi vs Union of India & Ors. reaffirms the principle that GST law is not intended to permanently shut down businesses for procedural lapses, especially when tax dues are fully discharged. By permitting restoration subject to compliance, the Court struck a balance between statutory discipline and business continuity. This ruling serves as an important precedent in matters involving cancellation of GST registration due to non-filing of returns and highlights the remedial scope of Rule 22(4) of the CGST Rules, 2017.

Disclaimer: All the Information is based on the notification, circular advisory 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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