Doing WFH due to Covid no reason to cancel of GST registration: HC

Court orders CBIC to issue austere circular mandating tax officers not to cancel registration of any taxpayer during the pandemic period otherwise than on charges of tax evasion

The Calcutta high court has set aside the GST authority's order cancelling the registration of a company on the ground that the firm was not operating from the registered place at the time of investigation due to Covid-19.

The court directed the tax authorities to grant a hearing opportunity to the petitioner, International Value Retail Pvt Ltd, to place all relevant documents and evidence in support of its submissions and pass a reasoned order within four weeks.

The company had filed the petition following rejection of its application for revocation of GST registration.

The company said its application was rejected by ignoring the relevant materials which established that at the time of inspection, the assessee was following a work-from-home (WFH) model due to the nationwide pandemic and therefore was temporarily unavailable at its registered place  of business.

Rajat Mohan, senior partner AMRG & Associates, said in the digital age, businesses must be permitted to function on "WFH" basis and cancellation of GST registration on such grounds will stall the growth of the Indian industry.

"The Board (The Central Board of Indirect taxes and Customs) must come out with an austere circular, mandating the tax officers not to cancel the registration of any taxpayer during the pandemic period otherwise than on charges of tax evasion," he said.