Velu Ramakrishnan (Prop: V.R.K. Equipments) Vs Commissioner of Commercial Taxes
Date: October 29, 2025
Subject Matter
GST Registration Revival Subject to Strict Conditions and Cash Payment of Arrears
Summary
The present Writ Petition, challenging the cancellation of the petitioner's GST registration, was disposed of at the admission stage with the consent of both parties. Both the petitioner's counsel and the Additional Government Pleader confirmed that the issue is squarely covered by the binding precedent of the same Court in Tvl. Suguna Cut Piece Center Vs. The Appellate Deputy Commissioner (ST) (GST), Salem and another.
Ruling:
The High Court allowed the Writ Petition and directed the revival of the petitioner's GST registration, subject to the petitioner strictly complying with the following ten conditions laid down in the Tvl. Suguna Cut Piece Center judgment:
1. File Pending Returns (Pre-Cancellation): The petitioner is directed to file all pending returns for the period prior to the cancellation of registration, along with the defaulted tax, interest, and applicable fine/fee, within a period of forty-five (45) days.
2. Cash Payment of Arrears (No ITC Adjustment): The payment of tax, interest, and fine/fee for the defaulted period shall not be made or adjusted from any Input Tax Credit (ITC) that may be lying unutilized or unclaimed.
3. Scrutiny of Unutilized ITC: Any unutilized or unclaimed ITC remaining must be scrutinized and approved by a competent officer of the Department before utilization.
4. Utilization for Future Liability: Only such approved ITC shall be allowed to be utilized for discharging future tax liability.
5. File Subsequent Returns (Post-Cancellation): The petitioner must file GST and returns for the period subsequent to the cancellation of registration, declaring the correct value of supplies.
6. Cash Payment Post-Cancellation: Payment of GST for the post-cancellation period shall also be in cash.
7. Scrutiny of Post-Cancellation ITC: If any ITC was earned post-cancellation, it shall be allowed to be utilized only after scrutiny and approval by the competent authority.
8. Restrictions on Petitioner: The respondents may impose such restrictions/limitations on the petitioner as warranted to ensure there is no undue passing of ITC or violation of law (e.g., bill trading) pending this exercise.
9. Immediate Revival: On compliance with the payment of tax, penalty, and uploading of returns, the registration shall stand revived forthwith.
10. System Architecture Change: The respondents shall instruct the GST Network to make suitable changes in the architecture of the GST Web portal to allow the petitioners to file their returns and pay the dues.
The entire compliance exercise by the respondents is directed to be carried out within thirty (30) days from the date of receipt of a copy of the order.
FULL TEXT OF THE JUDGMENT/ORDER OF MADRAS HIGH COURT
This Writ Petition is being disposed of at the time of admission with the consent of the learned counsel for the Petitioner and the learned Additional Government Pleader for the respondents.
2. Both the learned counsel for the Petitioner and the learned Additional Government Pleader for the Respondents confirmed that the issue is squarely covered by the decision of this Court in Tvl.Suguna Cut Piece Center, Represented by its Authorized Signatory Vs. The Appellate Deputy Commissioner (ST) (GST), Salem and another, (2022) 99 GSTR 386 wherein, in Paragraph Nos.227 to 229, this Court has observed as under:-
“227. This is a fit case for exercising the power under Article 226 of the Constitution of India in favour of the petitioners by quashing the impugned orders and to grant consequential relief to the petitioners. By doing so, the Court is effectuating the object under the GST enactment of levying and collecting just tax from every assessee who either supplies goods or service. Legitimate Trade and Commerce by every supplier should be allowed to be carried on subject to payment of tax and statutory compliance. Therefore, the impugned orders deserve to be quashed.
228. These petitioners deserve a chance and therefore should be allowed to revive their registration so that they can proceed to regularize the defaults. The authorities acting under the Act may impose penalty with the gravity of lapses committed by these petitioners by issuing notice. If required, the Central Government and the State Government may also suitably amend the Rules to levy penalty so that it acts as a deterrent on others from adopting casual approach.
229. In the light of the above discussion, these Writ Petitions are allowed subject to the following conditions:-
i. The petitioners are directed to file their returns for the period prior to the cancellation of registration, if such returns have not been already filed, together with tax defaulted which has not been paid prior to cancellation along with interest for such belated payment of tax and fine and fee fixed for belated filing of returns for the defaulted period under the provisions of the Act, within a period of forty five (45) days from the date of receipt of a copy of this order, if it has not been already paid.
ii. It is made clear that such payment of Tax, Interest, fine / fee and etc. shall not be allowed to be made or adjusted from and out of any Input Tax Credit which may be lying unutilized or unclaimed in the hands of these petitioners.
iii. If any Input Tax Credit has remained utilized, it shall not be utilised until it is scrutinized and approved by an appropriate or a competent officer of the Department.
iv. Only such approved Input Tax Credit shall be allowed for being utilized thereafter for discharging future tax liability under the Act and Rule.
v. The petitioners shall also pay GST and file the returns for the period subsequent to the cancellation of the registration by declaring the correct value of supplies and payment of GST shall also be in cash.
vi. If any Input Tax Credit was earned, it shall be allowed to be utilised only after scrutinising and approving by the respondents or any other competent authority.
vii. The respondents may also impose such restrictions / limitation on petitioners as may be warranted to ensure that there is no undue passing of Input Tax Credit pending such exercise and to ensure that there is no violation or an attempt to do bill trading by taking advantage of this order.
viii. On payment of tax, penalty and uploading of returns, the registration shall stand revived forthwith.
ix. The respondents shall take suitable steps by instructing GST Network, New Delhi to make suitable changes in the architecture of the GST Web portal to allow these petitioners to file their returns and to pay the tax/penalty/fine.
x. The above exercise shall be carried out by the respondents within a period of thirty (30) days from the date of receipt of a copy of this order.”
3. The above said order will hold good to the present Writ Petition also. Accordingly, this Writ Petition stands disposed of in terms of the directions contained in Tvl.Suguna Cut Piece Center case (referred to supra). No costs. Connected Writ Miscellaneous Petitions are closed.