Decision To Cancel GST Registration With Retrospective Effect Must Be Based On Some Objective Criteria: Delhi High Court
The Delhi High Court in the matter of *Pratima Tyagi Vs. Commissioner of GST & ANR* held that the decision to cancel the registration of GST (Goods and Services Tax) with retrospective effect must be based on some objective criteria.
The Court was dealing with a petition against an order by which the person’s GST registration was cancelled with retrospective effect from July 1, 2017.
In this case, a Division Bench comprising Justice Vibhu Bakhru and Justice Amit Mahajan observed, “… the impugned order cancelled the petitioner’s GST registration with retrospective effect from 01.07.2017. In terms of Section 29(2) of the Central Goods and Services Tax Act, 2017, the proper officer has a discretion to cancel the registration from any date including with retrospective effect, however, the said discretion cannot be exercised in arbitrary manner.
The decision to cancel the registration with retrospective effect must be based on some objective criteria. In the present case, the petitioner’s GST registration was cancelled on account of non-filing of returns for a period of six months. We find no reason for cancellation of the petitioner’s GST registration even for a period when she was filing the returns.”