If SCN is Not Decided within 30 Days of Reply, GST Registration is Considered Revoked: Punjab & Haryana HC

Punjab and Haryana High Court ruled that suspension of GST registration will be considered cancelled if a Show Cause Notice (SCN) is decided within 30 days of reply.

Relief for Revocation of the Suspension-

The relief for revocation of the suspension of the applicant's GST registration is allowed by the bench of justice Sanjeev Prakash Sharma and Justice Sudeepti Sharma and noted that GST Council does not adjudicate on SCN on Nov 21, 2023, which had also suspended GST registration of applicant from same date.

SCN has been issued by department which suspends the registration of applicant w.e.f. Nov 21, 2023. Keeping the response filed by petitioner in consideration, the respondents were directed to decide the SCN and objections submitted via the applicant within 30 days in terms of Rule 22(3), which authorizes the respondents to cancel the registration w.e.f the date or decide it otherwise under 30 days.

Arguments of the Applicant-

The applicant has argued the suspension of petitioner's GST registration beyond the specific time duration breached the Article 19(1)(g) rights since GST registration suspension leads to business carried stagnant. Doing any taxable supply at the time of suspension rule 21A(3) prohibited the petitioner.

Rule 21A(4)-

This rule states towards the deemed revocation of suspension on completion of proceedings by the proper officer, w.e.f. the date when the suspension had come into effect.

Rule22(3) & Rule 21A(4)-

It including Rule 21A(4) should be interpreted to halt that if proper official is not able to pass an order under SCN within 30 days, the proceedings will be considered to be completed and the suspension will be revoked.

The HC has allowed the interim relief by interpreting the provisions where the suspension has been proceeding for more than 4 months.

Conclusion-

In a nut shell, with a significant ruling, Punjab & Haryana HC ruled that the suspension of GST registration is deemed to be cancelled if the SCN is not decided within 30 days of reply. If channel fails to pass an order under 30 days, the proceedings will be considered completed and suspension will be revoked.