AP High Court Rules in Favor of Assessee
The Andhra Pradesh (AP) High Court ruled that GST registration cannot be refused just because the assessee belongs to another state. This decision strengthens the constitutional right to conduct business anywhere in India.
Background of the Case
A Division Bench of the AP High Court, including Justices R Raghunandan Rao and Harinath N, delivered the ruling. The petitioner, Tirumala Balaji Marbles and Granites, sought GST registration under the APGST Act for a business in Rajamahendravaram. However, the Assistant Commissioner rejected the application, citing concerns about the assessee’s non-resident status.
The petitioner argued that the rejection was arbitrary and lacked legal backing. The case highlighted the bureaucratic obstacles businesses face when registering under GST in states where they lack a permanent representative.
AP High Court Rejects Grounds for Denial
The authorities denied registration because neither the assessee nor their representative lived in Andhra Pradesh. Officials feared potential tax evasion due to the absence of local oversight. They argued that this could lead to revenue losses for the state.
AP High Court’s Observations
The AP High Court dismissed this reasoning. It stated that the GST Act and Rules do not impose such restrictions. The bench affirmed that individuals from any state have the right to seek GST registration in Andhra Pradesh.
The court noted that concerns about tax evasion cannot justify denying registration. Citing Article 19 of the Constitution, the bench stressed that every citizen can trade and establish businesses across India. The judges also pointed out that GST laws already include mechanisms to monitor and prevent tax evasion, making the state’s concerns baseless.
The bench remarked, “Though the apprehension of the respondents may not be misplaced, it would not mean that registration can be refused on a ground not available under the Statute or the Rules.” This emphasized the need for legal adherence rather than arbitrary decisions.
AP High Court’s Verdict and Implications
The court ruled that the rejection lacked legal merit and favored the petitioner. This decision sets a precedent, preventing authorities from denying GST registrations based on the applicant’s state of origin. Legal experts believe this ruling will streamline GST registration for multi-state businesses and reduce bureaucratic delays.
Tax professionals see this judgment as a move toward a business-friendly environment. By clarifying that GST registration cannot be denied based on residency, the court reinforced the idea of a unified tax system.
Industry Reactions
Business associations and tax consultants welcomed the ruling. They stated that it upholds GST’s core principles. Industry leaders believe this clarity will encourage businesses to expand beyond their home states without registration hurdles.
Some experts suggest that this decision could lead to further simplifications in GST regulations. Businesses facing similar rejections in other states may now use this ruling in their appeals. This highlights the judiciary’s role in protecting business rights and ensuring fair tax administration.
Case Details
- Case Title: Tirumala Balaji Marbles And Granites v. The Assistant Commissioner St and Others
- Case Number: Writ Petition No. 1200/2025
- Counsel for Petitioner: Anil Kumar Bezawada
This ruling by the AP High Court reaffirms the right of businesses to operate freely across states without facing unnecessary bureaucratic barriers. The decision reinforces the importance of legal consistency in promoting ease of doing business.
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