The Hon’ble High Court of Rajasthan vide its order dated 11^th October 2022 in the matter of A.H. Marble Crafts Vs. The Commissioner of Goods and Service Tax & Others in D.B. Civil Writ Petition No. 16147/2019, held that linking of GSTIN cannot be denied on the absolute hyper-technical ground of not providing the information electronically by the assessee, where the intimation has been forwarded by the son (petitioner) being a legal heir, on death of his father, to cancel and link the GSTIN of his father’s firm with his GSTIN.

The petitioner moved the writ petition before the Hon’ble High Court assailing the inaction of the respondents and seeking directions to respondents to open the portal so as to allow the petitioner to complete the tax liability under Section 93 of the CGST Act, 2017.

Facts of the Case: –

• That the erstwhile proprietor of the firm Shri Abdul Hameed Bhati (father of the petitioner) expired on 31.01.2018 whereupon, an intimation was forwarded to the respondent CGST Department through a letter in hard copy.
• The CGST Act provides a procedure for cancellation and thereafter, transfer of registration of the dealer pursuant to the death of the proprietor of the firm, electronically in FORM GST REG – 16.
• However, in the instant case the information regarding the death of the sole proprietor was not forwarded to the CGST Department electronically and in the prescribed FORM GST REG – 16.
• That attempts were made on the behalf of the firm, but the returns could not be filed as the portal was blocked. In the meantime, a fresh registration has been acquired by the petitioner. Being aggrieved of the non-acceptance of the request for cancellation and transfer, and the inaction of the respondent authority in opening the portal so as to complete the liability under Section 93, the present writ petition has been moved.

Petitioner’s Submissions: –

• It was submitted on the behalf of the petitioner that the hyper-technical ground taken by the respondents has created an unnecessary hurdle in the way of the petitioner in clearing the tax liability of the firm.
• Referring to the clause 3(b) of Circular No. – 96/15/2019-GST dated 28.03.2019 wherein, procedure has been clarified with respect to ‘Cancellation of registration on account of death of the proprietor’, it was submitted that information about the death of the proprietor was forwarded to the respondents though in the wrong Performa and merely on this technical ground, the respondents have not acted upon the same.
• It was submitted that legal heirs of the sole proprietor can file an application for cancellation of registration electronically on common portal on account of transfer of business for any reasons including the death of the proprietor. Thereafter, the GSTIN of the transferee to whom the business had been transferred can be linked with the GSTIN of the transferor.
• Therefore, directions were sought to the respondents to open the common portal so that the petitioner can upload the requisite information in the FORM GST REG – 16 and to link the two accounts enabling the clearance of tax liability.

On the other hand, it was submitted on the behalf of the respondents that the application for cancellation of registration was made in FORM GST REG-29 and not in FORM GST REG-16 and thus, the system did not link the GSTIN of Shri Abdul Hameed Bhati (the deceased proprietor of the firm) to the GSTIN of the petitioner herein.  However, it could not be disputed that the GSTIN of the transferee and the transferor were not linked only on account of the information not being provided electronically on the common portal in FORM GST REG-16.

Held: –

• The Hon’ble Court after considering the submissions made and facts of the case, found that the hyper-technical ground taken in the instant case by the respondents, to deny the petitioner from the opportunity to link the GSTIN of his father’s firm with the new GSTIN number of the firm cannot be considered.
• Further it shows bonafide on the part of the petitioner that he gave the intimation about the death of the proprietor of the firm, and also reflects his willingness to remove the anomalies and clearing off the tax liability.

The Hon’ble Court with the above discussions, allowed the writ petition with the directions to the respondents to activate the common portal and allow the petitioner to upload the appropriate information in FORM REG – 16 within next 30 days.  On receipt of the information required, the GSTIN number of the transferee and the transferor shall be linked as per clause 3(b) of the Circular dated 28.03.2019.