In a recent case, the Delhi High Court while restoring the Goods and Service Tax ( GST ) registration observed that the in the show cause notice the authority failure to mention the reason for canceling the GST registration.
The petitioner DP Abhushan engaged in the business of jewelry related products and also carried out export of such products and possessed GST registration.
The respondent issued a Show Cause Notice to the petitioner seeking to cancel its registration. Though the notice does not specify any cogent reason, it merely states “Others”. Thereafter, impugned order passed on the Show Cause Notice does not give any reasons for cancellation
Aggrieved by the order the petitioner filed an appeal for restoring the canceled GST registration.
During the appeal proceedings the court observed the SCN merely states that the registration is liable to be canceled for the following reason “Neither attended PH nor responded to the SCN issued. Hence, canceled”. However, the said order in itself is contradictory
Therefore the impugned order dated 13.10.2022 does not qualify as an order of cancellation of registration. On one hand, it states that the registration is liable to be canceled and on the other, in the column at the bottom there are no dues stated to be due against the petitioner and the table shows nil demand.
Neither the Show Cause Notice nor the order dated 13.10.2022 canceling the GST registration of petitioner cited any such reason and the said reason has surfaced only in the appeal.
The said Show Cause Notice also does not put the petitioner to notice that the registration is liable to be canceled retrospectively. Accordingly, the petitioner had no opportunity to even object to the retrospective cancellation of the registration.
After analyzing the facts and arguments of both parties, a division bench of Justice Sanjeev Sachdeva and Justice Ravinder Dudeja set aside the show cause notice and order and The GST registration of the petitioner was restored.
Rishabh Sancheti, Ms. Padma Priya & Ms. Shreya Bhatnagar, Advocates appeared for the petitioner and Arnav Kumar & Mr. Gurdas Khurana, Advocates appeared for respondent.
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