GST / Indirect Tax : S.29 of CGST Act, 2017 and Effect of Full Payment of Tax on Cancellation Proceedings

GST / Indirect Tax : S.29 of the CGST Act, 2017 and Effect of Full Payment of Tax on Cancellation Proceedings

It was held in Bornali Borgohain v. Union of India [2025] GCtR 1456 (Gauhati) that as per Section 29(2)(c) of the CGST Act, 2017 an officer, duly empowered, may cancel the GST registration of a person from such date, including any retrospective date, as he deems fit, where any registered person, has not furnished returns for a continuous period of 6 (six) months. Rule 22 of the CGST Rules, 2017 has laid down the procedure for cancellation of the registration. It is discernible from a reading of the proviso to sub-rule (4) of Rule 22 of the Rules of 2017 that if a person, who has been served with a show cause notice under Section 29(2)(c) of the Act, is ready and willing to furnish all the pending returns and to make full payment of the tax itself along with applicable interest and late fee, the officer, duly empowered, can drop the proceedings and pass an order in the prescribed Form i.e. Form GST REG-20.