GST Registration Can’t Be Cancelled If Business Not Carried From the Premises Due to Covid: HC


The Calcutta High Court has ruled that goods and services tax (GST) registration cannot be cancelled if business was not carried out from the premises, due to the nationwide Covid pandemic.

The order was issued in favour of International value retail, where the revenue department and GST authorities had issued a show cause notice and adjudication order cancelling the company’s registration for not carrying out its businesses from official premises but from home, in November 2020.

As, during the pandemic, many businesses opted for WFH (work from home) policy for their employees as business activity from registered premises came to a halt.

“Only due to extraordinary compelling circumstances of Covid-19 and in following the protocol and norms of Covid-19 temporarily petitioner was not carrying his business from the premises in question from officially registered premises and they were carrying business in question from home.”

“Considering this fact of the case I am inclined to set aside the impugned order dated 9th November, 2020 by which the respondent concerned has rejected the petitioner’s application for revocation of cancellation of its GST registration,” Justice Md. Nizamuddin said in the order passed last month, which was released on Monday.

Further, the Court has also directed revenue authorities to consider afresh the company’s application for revocation of cancellation of its registration under GST Act in accordance with law. The Court has directed the authorities to pass a ‘reasoned and speaking order’ after hearing the petitioner or an authorized representative, within four weeks and to consider the documents to be placed by them at the time of hearing.

As per the an experts, the judgement would come as a relief to companies that may be facing similar situations, as such cancellations were not justified given the circumstances that businesses faced during the pandemic.

“This is a welcome judgement that the registration can’t be cancelled when employees are not present at the registered place of business due to the pandemic-like situation” an another expert stated.


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