Telangana High Court Clarifies Revocation of GST Registration Cancellation Must Be Considered If Application Filed Within 270 Days

Background: The petitioner’s GST registration was cancelled on 09.09.2024 for issuing invoices without actual supply of goods or services, allegedly violating Rule 21(b) of the Central and State Goods and Services Tax Rules, 2017. The petitioner subsequently applied for revocation of the cancellation, along with a delay condonation application, on 24.02.2025. A show cause notice was issued on 27.02.2025, but the application for condonation of delay was rejected by order dated 05.03.2025. The petitioner challenged this rejection before the Telangana High Court.

Submissions: The petitioner argued that the application for revocation was filed within the prescribed 270-day period from the date of cancellation, as provided under Rule 23 of the GST Rules. It was further submitted that the application was rejected without affording an adequate opportunity to respond to the show cause notice, and that a remand would allow the petitioner to file a reply and have the matter reconsidered on merits.

Court’s Reasoning: The High Court examined the relevant provisions and found that Rule 23 of the GST Rules permits an application for revocation of cancellation of registration to be filed within 270 days from the date of cancellation. The Court observed that the impugned order rejecting the application was passed solely on the ground of delay, without considering that the application was within the permissible period. The Court also noted the lack of opportunity given to the petitioner to respond to the show cause notice.

Decision and Directions: The Court set aside the impugned order dated 05.03.2025 and directed the petitioner to file its reply to the show cause notice dated 27.02.2025 before the Joint Commissioner, Gandhi Nagar, within two weeks. The Joint Commissioner was instructed to take a fresh decision on the application for revocation of cancellation within two weeks thereafter, after considering the petitioner’s reply.

Additionally, the Court addressed the petitioner’s difficulty in making the statutory pre-deposit for appeal due to the blocking of the electronic credit ledger. The Court clarified that the petitioner may make the pre-deposit through the electronic cash ledger in accordance with Section 49(3) of the Central and State GST Acts.

Conclusion: The writ petition was disposed of with these directions, and all pending miscellaneous applications were closed. The judgment reinforces the principle that applications for revocation of GST registration cancellation must be considered on merits if filed within the statutory period, and that procedural fairness requires an opportunity to respond to show cause notices.