The Goods and Services Tax Appellate Tribunal (GSTAT), Bengaluru Bench, has held that an application to add a godown as an additional place of business cannot be rejected merely because ownership of the premises, or the constitution of the landlord firm, is under dispute in pending civil proceedings.

The Bench of Prabhakaran P.M. (Judicial Member) and Ravi Jesuraj S. (Technical Member (State)) ruled that GST authorities must examine the application against the statutory requirements and prescribed documents, rather than insist that the applicant first obtain a civil court decision on ownership.

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The appellant/assessee is a partnership firm trading in food grains, pulses, sugar, oil and other provisions at APMC Yard, Shivamogga, applied on September 6, 2025, to add Godown No. I-10 as an additional place of business under its existing GST registration.

The Assistant Commissioner of Commercial Taxes, LGSTO-220, Shivamogga, rejected the application on October 6, 2025. The rejection rested on pending civil suits concerning ownership of the premises and disputes relating to the lessor firm, M/s Mani & Co.

The first appellate authority upheld the rejection on April 1, 2026, taking the view that registration could not be granted for premises whose ownership remained disputed until the civil court resolved the matter.

The firm challenged that decision before the Tribunal, contending that the GST framework did not require a civil decree establishing the landlord’s title before rented premises could be added to a registration.

Examining Section 28 of the CGST and KGST Acts read with Rule 19 of the corresponding Rules, the Tribunal held that the proper officer’s role is to verify the change sought in the registration particulars.

For an additional place of business, that exercise concerns whether the premises exist, whether their description and address are correct, whether the taxpayer stores goods or conducts business there, and whether the prescribed documents show the arrangement under which the taxpayer occupies them.

The Tribunal explained that the definition of “place of business” under Section 2(85) focuses on the use of the premises, including storage of goods in a warehouse or godown. It does not make ownership by the taxpayer a prerequisite.

GST registration serves tax administration and does not confer title to immovable property. Consequently, authorities that lack jurisdiction to decide ownership cannot make the outcome of an ownership suit a condition for recording a place of business.

The Bench also clarified that admitting the existence of civil litigation does not amount to admitting that the taxpayer has no right to occupy the premises.

The Tribunal observed that, for rented or leased premises, the documentary requirements include a valid rent or lease agreement and one prescribed document supporting the lessor’s ownership, such as a property tax receipt, municipal khata copy or electricity bill. Where the agreement is unregistered, the lessor’s identity proof may also be required.

It considered CBIC Instruction No. 03/2025-GST dated April 17, 2025, which explains these documentary requirements and discourages demands for original physical documents and unnecessary additional material.

The Tribunal did not decide whether the CBIC instruction formally bound the State officer. Instead, it adopted its reasoning as a correct and fair interpretation of the documentary list common to the CGST and KGST Rules.

Neither authority below had properly assessed the application against these requirements. Both had treated the pending ownership litigation as decisive.

The Tribunal nevertheless found that the documents required factual scrutiny before approval could be directed.

The electricity bill relied upon by the firm described the installation as situated at “I/11(3) Block, APMC Yard”, whereas the proposed additional place of business was Godown No. I-10. Whether the bill actually related to the godown required verification, including, if necessary, confirmation from the electricity supplier.

If it did not relate to the godown, the taxpayer should be asked to produce another prescribed document rather than face rejection without notice.

The Tribunal also examined the status of the lease deed dated February 1, 2025. It clarified that the civil court had permitted the unregistered deed to be considered for the collateral purpose of determining the character and commencement of possession after payment of stamp duty and penalty. This did not amount to a final determination validating the lease.

Since the original deed remained in the civil court’s custody, the GST officer could not insist on its production. A certified copy would suffice for verification.

The Tribunal found a separate procedural defect in the first appellate proceedings.

The appellate authority had relied on a third-party letter dated March 2, 2026, received after the personal hearing, without showing that the firm had been given a copy or an opportunity to respond.

The Bench held that fresh adverse material received after a hearing must either be excluded from consideration or disclosed to the affected party with an opportunity to rebut it.

It also found that the appellate order failed to address important submissions and documents, including the prescribed documentary requirements, the electricity bill and the relevant civil court order.

The Tribunal distinguished the decision in Parveez Ahmad Baba, relied upon by the appellate authority.

That matter involved competing claimants seeking to operate the same business from the same premises. In the present case, no person other than Sri Subramanya Stores sought GST registration for the godown or claimed to trade from it.

The dispute concerned ownership and the constitution of the landlord firm. Recording the godown would therefore not require the GST officer to choose between rival traders.

The Tribunal directed the proper officer to decide the application afresh within 45 days from communication of the order, confined to statutory compliance, prescribed documents and verification of the premises and their business use.

The firm may submit further prescribed documents within 15 days. Any specific deficiency must be communicated through Form GST REG-03, with seven working days to reply and a personal hearing before a reasoned decision.

The officer cannot reject the application merely because civil proceedings remain pending, a civil decree has not been obtained, or the original deed is held by the civil court.

The Tribunal expressly left ownership, the constitution of the lessor firm and the validity of the lease undecided. It further directed that neither its order nor the decision on remand should be treated as evidence on those questions. If registration is approved and a competent civil court subsequently holds that the firm is not entitled to occupy the godown, the firm must apply to delete it from its registration within 15 days.

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