The Delhi High Court has set aside a retrospective GST registration cancellation order due to the petitioner’s failure to file the ‘Reply of ASMT-10’. The court directed the Appellate Authority to reconsider the petitioner’s appeal on its merits, ensuring that the issue of delay does not influence the decision.
The petitioner, M/s Birchand, challenged the order dated 19.04.2024, passed by the Appellate Authority under Section 107 of the Goods and Services Tax (GST) Act, 2017. This order had rejected the petitioner’s appeal against the GST registration cancellation order dated 30.12.2021.
The petitioner, which had been conducting business prior to the introduction of the CGST regime on 01.07.2017, migrated to the GST regime and was assigned GSTIN 07AFAPC2167H1ZV. Discrepancies in the petitioner’s returns prompted the respondents to issue a notice on 27.01.2021. The petitioner claimed that this notice went unnoticed, leading to a lack of response.
Following this, the Proper Officer issued a Show Cause Notice (SCN) on 16.03.2021, proposing to cancel the petitioner’s GST registration due to non-filing of the ‘Reply of ASMT-10’. The SCN stated: “REPLY OF ASMT-10 NOT YET FILED/RECEIVED.” The petitioner was given seven working days to respond, and the GST registration was suspended from the date of the SCN.
The petitioner, represented by Sanjeev, contended that the SCN did not specify any date or time for a personal hearing, thereby denying them a real opportunity to be heard. The petitioner did not respond to the SCN, resulting in the cancellation of their GST registration with retrospective effect from 15.07.2017. The impugned cancellation order indicated that no tax was determined to be due from the petitioner.
Further, the petitioner argued that no physical notice was received and the GST portal was not accessed during that period due to disruptions caused by the COVID-19 pandemic. An appeal filed on 09.09.2022, was not entertained due to being filed after the stipulated period. However, the Supreme Court in Suo Motu Writ Petition (C) No.3/2020 had extended the limitation period until 28.02.2022.
The High Court, comprising Justice Vibhu Bakhru and Justice Sachin Datta, observed that the SCN did not propose retrospective cancellation, and the cancellation order lacked any reasoning for such retrospective effect. The court found that the petitioner had not been granted a fair opportunity to be heard.
The court set aside the impugned order and remanded the matter to the Appellate Authority for a fresh decision on the petitioner’s appeal, ensuring that the petitioner is afforded an opportunity for a personal hearing. The court requested the Appellate Authority to resolve the appeal expeditiously, preferably within eight weeks from the date of the judgement.
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