No late fees to be charged if returns not filed due to cancellation of GST registration: HC

Case Details: Modicum Enterprise (OPC) (P.) Ltd. v. Deputy Commissioner of State Tax/Assistant Commissioner of State Tax - [2023] 146 taxmann.com 450 (Calcutta)

Judiciary and Counsel Details

• • T. S. Sivagnanam & Hiranmay Bhattacharyya, JJ.
  • Sourabh Sankar Sengupta & Indranil Biswas for the Appellant.
  • Ms Sanjukta Gupta, T.M. Siddique, Debasish Ghosh & V. Kothari for the Respondent.

Facts of the Case

The appellant was a registered dealer under GST and its registration was cancelled on the ground that the appellant was a non-existing dealer. It filed appeal and its registration was revoked but demand of late fees of Rs. 5000 per return was raised when it tried to file GST returns. It challenged the demand by filing writ petition and contended that registration was cancelled on a factually incorrect premise by department. The learned Single Judge declined to grant interim order and the appellant filed appeal.

High Court Held

The Honorable High Court noted that demand of late fees under Section 47 of CGST Act, 2017 can be raised for non-filing of return by due date but this provision can be invoked only when a person fails to file return. In the instant case non-filing of return was on account of cancellation of GST registration. However, later on order of cancellation of registration was quashed and the registration was restored. Therefore, it was held that imposition of late fee by invoking provisions of Section 47 was not sustainable. The Court also directed department to render appellant necessary assistance in filing returns electronically and not to demand any late fees.