The Orissa High Court in the case M/s. Galaxy Bar and Restaurant, Nayagarh Versus State of Odisha and others observed and has held that the license application should not be rejected only because a GST return has not been filed yet, since it is being unrealistic to except that the same is to happen without the actual commencement of its business.
The division bench comprising of Chief S. Muralidhar and Justice G. Satapathy in the case observed that unless the license has been issued to the petitioner and is able for commencing the its business, the question would not arise of filing a GST return.
In the present case, an application has been filed by the petitioner for the restaurant’s ON Shop license way back on 05.04.2022. It has been responded by the petitioner to various queries and also provided clarifications. It was also followed by an inquiry wherein the objections were raised. A report has also been submitted by the Inspector of Excise, Sadar, Nayagarh on 04.6.2022, to the Superintendent of Excise, Nayagarh, wherein stating that none of the objections were valid. It also included the objections received from the Chairperson of the Nayagarh Municipality. On 06.06.2022, the Superintendent of Excise made a recommendation to the Collector, Nayagarh, that it should grant the petitioner’s application.
Further, the Commissioner launched another high-level joint inquiry of Excise on 13.07.2022. and on 05.11.2022., another inquiry was held. Thus, all the inquiries were in favor of the petitioner, with the Excise Deputy Commissioner informed the department that the building in which the restaurant was being run is in a commercial area.
The court ordered for another inquiry on 24.01.2023 for determining if the petitioner was registered under the GST Act and if its returns thereunder were filed.
In the case, the petitioner submitted an application which itself showed that a copy of the GST registration certificate has been enclosed. Thus, the issue raised for filing a GST return would not come up unless the petitioner is granted a license and is able to start their business.
It has also been held by the court that it being unreasonable to anticipate GST return which being filed prior to the petitioner actually starting its business; an application should not be turned down solely on the basis because a GST return has not
been filed yet.