GST Update

 Desk of CA. Praveen Sharma – 1087  Series (CAPS) 

 BOMBAY HIGH COURT IN THE CASE OF Mahalasa Constructions Private Limited v. Union of India & Others

 Mahalasa Constructions Private Limited v. Union of India & Others

Bombay High Court Refuses Interim Relief Against GST Registration Cancellation

Mahalasa Constructions approached the Bombay High Court challenging the cancellation of its GST registration under Section 29(2)(e) of the CGST Act read with Rule 21A of the CGST Rules.

The petitioner argued that its registration could not legally be cancelled under Section 29(2)(e). The High Court observed that the petitioner had raised an arguable legal issue that required further examination.

However, the petitioner had declared premises situated in Nagpur as its place of business. It was undisputed that no business activity was being carried out from those premises during the relevant period.

Rule 21A permits the authorities to initiate action where a registered person is found not conducting business from the declared place of business. Considering this admitted factual position, the Court found no apparent error in the cancellation order requiring immediate interference.

Accordingly, the Bombay High Court refused to grant an interim stay against the cancellation of the GST registration. However, it issued notice to the respondents, meaning that the petitioner’s main legal challenge remains pending for final consideration.

The case highlights that merely raising an arguable legal issue may not be enough to obtain interim relief. A taxpayer must also establish genuine business operations from the place of business declared in the GST registration.

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