Modicum Enterprise OPC Private Limited vs Deputy Commissioner Of State Tax/Assistant Commissioner Of State Tax, Shibpur Charge

Lorem ipsum dolor Can Late Fees be levied for filing late Returns in the case where returns were late because GST Registration was cancelled on the ground that Petitioner is the non-existing dealer and later restored through an appeal? The validity of Late Fees U/s 47 was challenged in this case. Calcutta High Court ruled in fa vou of the Asses see. Facts and Timelines: GST Registration of the Petitioner was cancelled on the ground that the appellant was a non-existing dealer. Petitioner appealed before Senior Joint Commissioner of State Tax, Howrah Circle  Petitioner won the appeal against cancellation and his GST Registration was restored. When he tried to file his return, the System charged Late Fees U/s 47 of Rs. 5,000/- per return. Petitioner challenged the validity of these late fees as order of appellate authority is clear that the ground on which the cancellation was made, was incorrect.  Calcutta High Court held that as the cancellation order was passed on a factually incorrect premise. If that be so, the appellant cannot be penalised by demanding a late fee. The Demand of a late fee from the appellant of Rs.5,000/- per return is without jurisdiction and not tenable in the eye of the law. The nodal officer is directed to render necessary assistance so that the appellant will be able to file the return without the payment of late fee. sit amet,  consectetur adipis cing elit. Ut elittellus, luctus nec ullamcorper mattis, pulvinar dapibus leo.

1.This intra-Court appeal by the writ petitioner is directed against the order dated 28th September, 2022 passed in W.P.A. 21708 of 2022 by which the learned Single Judge declined to grant interim order. Aggrieved by the same, the appellant is before us by way of this appeal.

2.We have heard Mr. Saurabh Sankar Sengupta, learned Advocate appearing for the appellant, Mr. Debasish Ghosh, learned standing counsel for the respondents/State and Ms. Sanjunkta Gupta, learned standing counsel for the Union of India.

3.The appellant was a registered dealer under the provisions of the Central Goods and Services Tax Act, 2017 (for shot, “the Act”) and the rules framed thereunder. The registration was cancelled on the ground that the appellant was a non-existing dealer. Aggrieved by the same, the appellant / writ petitioner preferred the appeal before the Senior Joint Commissioner of State Tax, Howrah Circle and by an order dated 22nd July, 2022, the appeal was allowed and a clear finding has been rendered by the appellate authority that the ground on which the cancellation was made, was incorrect. Consequent upon the order passed by the appellate authority, the cancellation of the registration was revoked by an order dated 27th January, 2020 and the registration was restored. When the appellant attempted to file his returns, there is a demand of Rs.5,000/- per return stating that it is late fee payable under Section 47 of the Act. Section 47 of the Act would relevant for the case on hand, which reads as follows:

4.In terms of the sub-Section (1), any registered person, who fails to furnish return by the due date shall pay late fee of 100 rupees everyday during which such failure continues subject to a maximum amount of Rs.5,000/-. Sub-Section (2) states that any registered person, who fails to furnish the return required under Section 44 is also required to pay such late fee.

5.The question would be whether the late fee can be demanded from the appellant. Admittedly, the provision deals with a person, who fails to furnish the returns either under Section 39 or Section 45 or Section 44. In the instant case, the revenue does not state that the appellant failed to furnish its return within the due date. The reason for non-furnishing the return is cancellation of the registration on the ground that the appellant is a non-existing dealer.

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