The Allahabad High Court dismissed a writ petition filed by M/s Genius Ortho Industries challenging the order dated February 27, 2023 issued by the Joint Commissioner, C.G.S.T. (Appeal), cancelling its GST registration. The writ petition was dismissed due to the suppression of a material fact by the petitioner.
The authorities cancelled the GST registration of the petitioner upon physical verification, as they found no business activity was being conducted at the premises. Despite repeated attempts, the proprietor could not be reached as his phone was switched off.
A show cause notice was issued by the department, which was replied to by the petitioner, and subsequently the order cancelling the registration was passed. The petitioner then appealed, but the appeal was also dismissed.
Sudarshan Singh and Amit Mahajan, counsels appearing for the respondents, pointed out that the petitioner had obtained a new registration subsequent to the cancellation of the earlier registration. This crucial information was not revealed during the initial stages of the case.
Upon further investigation ordered by the Court, it was revealed that the factory was operational, and the proprietor had indeed obtained a new registration before filing the writ petition.
The bench of Justice Shekhar B. Saraf expressed dissatisfaction with the petitioner’s failure to disclose the new registration, which led to unnecessary verification proceedings, and cited legal precedent emphasising the importance of full disclosure and clean hands in approaching the court.
The court observed that “Article 226 of the Constitution of India is a discretionary jurisdiction which is to be exercised for petitioners who are acting in a good faith. The principle of uberrima fides requires a party that comes to a court to act in utmost good faith. The above principle is the genesis of the expectation of the court to pass orders at the behest of the petitioner who has approached the Court with clean hands. The moment this trust is broken and it is discovered that there is suppression of material facts, the court is bound to dismiss the said petition without granting any relief whatsoever to the petitioner”.
In conclusion, the court dismissed the writ petition on the grounds of suppression of material facts. The petitioner was advised to seek relief through appropriate channels.
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