GST CASE DIGEST: Significant Case Laws on Cancellation of GST Registration

GST registration is a process by which a taxpayer gets himself registered under GST.The registration granted under GST can be cancelled for specific reasons. The cancellation can either be initiated by the department on their own motion or the registered person can apply for cancellation of their registration.

Reasons for Cancellation of GST Registration

1) The person is registered under one of the previous tax laws: Some businesses registered under the old tax regime are not liable for GST registration. For instance, the threshold limit for VAT was Rs. 10 lakhs, and that for GST is Rs. 40 lakhs. Thus, people registered under VAT are not liable for GST registration.

2) Discontinuation of Business: If a business stops operations, the owner can put in an application for cancellation of GST registration.

• If a business entity combines with another
• Partial or full transfer of business for any reason, including the death of the proprietor
• Change in business constitution
• If a registered person is no longer required to be under the GST scheme. This excludes those who have registered voluntarily under section 25 (3) of the CGST Act
• If a person registered under the GST composition scheme doesn’t file returns for 3 months in a row
• If the person doesn’t comply with GST laws and provisions, it leads to GST cancellation under the GST act
• If a registered person doesn’t file GST returns for 6 months continuously
• If a person registers their business voluntarily under section 25(3) of the CGST and doesn’t start a business within 6 months of the registration date
• If GST registration is obtained using fraud, misstatement or suppression of facts .

Manoj Kumar Sah vs State of Bihar, CITATION: 2023 TAXSCAN (HC) 192

The Patna High Court restored GST Registration of the petitioner, Manoj Kumar Sah on the ground that there was gross violation of natural justice principles on the order canceling the GST Registration.

The Bench comprising Chief Justice Sanjay Karol and Justice Partha Sarthy observed that “The authority ought to have at least referred to the contents of the show cause and the response thereto, which was not done. Not only the order is non-speaking, but cryptic in nature and the reason for cancellation not decipherable therefrom. Principles of natural justice stand violated and the order needs to be quashed as it entails penal and pecuniary consequences.”

Assistant Commissioner of State Tax, ITC Investigation Unit vs LGW Industries Limited & ors CITATION: 2023 TAXSCAN (HC) 112

A Division Bench of the Calcutta High Court (HC) ruled that Input Tax Credit (ITC) cannot be Denied due to Cancellation of GST Registration with retrospective effect.

The respondents in the writ petition is LGW Industries Limited & Ors.The intra court appeal against a common judgment and order passed by the Single Judge though there spondents /writ petitioners, had sought for a larger relief in the writ petition mainly for issuance of writ of declaration to declare Section 16(2) (c) of the CGST Act/WBGST Act as unconstitutional.

A Division Bench comprising Justice TS Sivagnanam and Justice SupratimBhattacharya observed that “In such circumstances, we are of the view that the directions issued by the Single Judge were not only in the interest of the respondents/writ petitioners, but also would safeguard the interest of the revenue.”

YASH KRISHI SEVA KENDRA vs STATE OF MADHYA PRADESH CITATION: 2022 TAXSCAN (HC) 956

In an order favoring the GST department, the Madhya Pradesh High Court has upheld an order stating that the notice for cancellation of GST registration was duly received by the assessee via mobile phone.

justice Sheel Nagu & Justice Virender Singh observed that it is clear from the return that the respondents adhered to the provision of Section 169 of the GST Act as regards communication of the show cause notice as well as order of cancellation of registration and, therefore, no fault can be found with the Revenue. “Pertinently, the return of respondents further reveals that the show cause notice in question was sent on the mobile bearing number as mentioned on the portal belonging to petitioner and e-mail address of erstwhile consultant,” the Court held.

M/s S A Traders vs Goods and Service Tax Officer CITATION: 2022 TAXSCAN (HC) 929

A Division Bench of the Andhra Pradesh High Court has recently held that,  both impugned show cause notice as well as the order for cancellation of registration are not sustainable in the eye of law as both of them are not clear enough to understand the mind of the issuing authority.The Bench of Justice Durga Prasad Rao and Justice T Mallikarjuna Rao observed that, “both show cause notice as well as the order of cancellation of registration are dubious enough and failing to divulge the misdeed or fraud allegedly committed by the petitioner.”

SMT. SHAILAJA CHANDRASHEKAR vs ADDITIONAL COMMISSIONER OF CENTRAL TAX CITATION: 2022 TAXSCAN (HC) 818 Be

The Karnataka High Court, in a recent ruling, held that an appeal against cancellation of GST registration due to non-filing of 3b cannot be rejected merely because option of revocation was not opted by the assessee.

Justice S.R.Krishna Kumar observed that Section 107 of the CGST Act, 2017 will indicate that as against an order passed by the respondent No.3 canceling the registration of GST, the petitioner has an remedy by way of appeal under Section 107 before the respondent No.1-Appellate Authority.

A.H. Marble Crafts vs The Commissioner Tax CITATION: 2022 TAXSCAN (HC) 755

In a ruling favoring the assessee, the Rajasthan High Court has held that the GST department cannot deny the benefit of linking of GSTIN on death of proprietor merely on the technical ground that the application for cancellation of GST registration was made using a wrong form.

A division bench comprising Justice Sandeep Mehta and Justice Kuldeep Mathur directed the GST authorities to re-open the portal to allow the petitioner to file the same and held that “We feel that this absolute hyper technical ground cannot be considered valid so as to deny the petitioner from the opportunity to link the GSTIN of his father’s firm with the new GSTIN number of the firm.

Poonamchand Saran vs Union Of India CITATION: 2022 TAXSCAN (HC) 719

A division bench of the Rajasthan High Court has restored an appeal against the order canceling GST Registration on the ground that the assessee failed to submit the hard copies after filing the appeal through online within the prescribed time.

Justice Sandeep Mehta and Justice Kuldeep Mathur held that “It cannot be denied that the petitioners herein would not be able to continue with their business in absence of GST registration and thus, would be deprived of their livelihood which amounts to violation of right to life and liberty as enshrined in Article 21 of the Constitution of India.”

M.Mallika Mahal vs The Commissioner of Central GST and Central Excise CITATION: 2022 TAXSCAN (HC) 697

In a significant ruling, the Madras High Court has permitted the businesses to file returns for the period prior to the cancellation of GST Registration and make payment of tax dues along with interest. The Single Judge, while reiterating the order passed on 31st January this year, also advised the State to instruct GSTN to make necessary changes in the portal to facilitate these changes.

Drs Wood Products vs State Of U.P   CITATION:  2022 TAXSCAN (HC) 645

In an assessee-friendly ruling, the Allahabad High Court has imposed a cost of Rs. 50,000 on the GST department finding that the registration of the assessee was arbitrarily canceled. Noting that this kind of actions not only affects the assessee, but the same is also causing adverse effects on the revenue as it is not in consonance with the ease of doing business.

Vinod Kumar vs Commissioner Uttarakhand State GST and others CITATION: 2022 TAXSCAN (HC) 526

A division bench of the Uttarakhand High Court has upheld the maintainability of the writ petition challenging the order canceling GST registration by holding that the same amount to violation of right to livelihood.

A bench of the Acting Chief Justice Shri Sanjaya Kumar Mishra and Justice Shri Ramesh Chandra Khulbe observed that “It is apparent from the record that a notice was given on the website, which in our considered opinion, is not sufficient, and a personal notice has to be given before cancellation of the registration. Therefore, the Court can invoke its jurisdiction under Article 226 of the Constitution and hold that the orders passed by the learned Commissioner can be interfered in a writ jurisdiction.”

Tvl. GK Digital Printing vs The Assistant Commissioner CITATION: 2022 TAXSCAN (HC) 436

In a recent ruling, the Madras High Court has directed the GST Network (GSTN) to allow the payment of tax, penalty and fine by the taxpayer whose GST registration is canceled due to non-filing of returns.

Justice C Saravanan has observed that the issue that arises for consideration in this Writ Petition was detailed considered by this Court in the case Tvl. Suguna CutPiece Center Vs. The Appellate Deputy Commissioner (ST) (GST) and another, wherein, considering the revenue of the Government, certain reliefs were granted to the petitioner

Concluding the order with a few directions, the Court said that the respondents shall take suitable steps by instructing GST Network, New Delhi to make suitable changes in the architecture of the GST Web portal to allow these petitioners to file their returns and to pay the tax/penalty/fine.

Sanchita Kundu & Anr. vs The Assistant Commissioner of State Tax CITATION: 2022 TAXSCAN (HC) 383

The Calcutta High Court has held that the input tax credit cannot be denied in case of genuine transactions with suppliers whose GST registration is canceled.

The court held that  “If it is found upon verification and considering the relevant documents that all the purchases and transactions in question are genuine and supported by valid documents and transactions in question were made before the cancellation of registration of those suppliers and after taking into consideration as to whether facts of the petitioners are similar to the judgements of the Supreme Court and various High Courts and of this Court upon which petitioners intend to rely and if it is found similar to the present case in that event the petitioners shall be given the benefit of input tax credit in question,”

SHREE SANWARIYA IMPEX vs STATE OF GUJARAT  CITATION:  2022 TAXSCAN (HC) 376

A division bench of the Gujarat High Court comprising Mr Justice J.B.Pardiwala and Ms Justice Nisha M. Thakore has held that show cause notice for cancellation for registration being vague can’t be valid and restored the registration under GST Act.

 The bench viewed this case in light of the decision in the case of Aggarwal Dyeing and Printing Works vs. State of Gujarat & 2 Ors. The bench quashed and set aside the impugned order canceling the registration and restored the registration. Further, directed the department to do proceedings strictly by law and observations made by the Court in the case of Aggarwal Dyeing and Printing Works. To Read the full text of the Order .

MICRO FOCUS SOFTWARE SOLUTIONS INDIA PRIVATE LIMITED vs UNION OF INDIA & ANR. CITATION:  2022 TAXSCAN (HC) 361

The Delhi High Court has set aside the order of cancellation of GST registration due to No notice served prior to inspection of premises.

The division bench presided by Mr. Justice Rajiv Shakdher and Ms. Justice Poonam A. Bamba has observed that the petitioner, admittedly, filed a reply, in which reasons were set out as to why the petitioner wished to continue with its registration. When the GST registration cancellation order was passed, the concerned officer had with him the reply filed by the petitioner. But there is no reference to the said reply or the reasons set out therein, in the cancellation order.

 The High Court further observed that the order whereby the application for revocation was rejected shows that an inspection was carried out on the premises of the petitioner. Rule 25 requires an inspection to be done in the presence of the person whose property is being inspected; it was not done as the petitioner had no notice of the inspection.

Galaxy Mechanical Engineering Equipments Pvt Ltd & Anr. VS Assistant Commissioner, Bally CITATION: 2022 TAXSCAN (HC) 114

The Calcutta High Court recently suspended the part of order passed by the GST department for the cancellation of GST registration as the Court found the allegations in the show-cause notice were vague.

Justice Md. Nizamuddin observed that on perusal of the aforesaid impugned order of cancellation of the registration, the allegation of the petitioner is correct since no reason has been given in the impugned order of cancellation and is non-speaking order and is not sustainable in law and accordingly the impugned order of cancellation of registration of the petitioner is set aside and all legal consequences will follow.

LGW Industries Limited & Ors vs Union of India & Ors CITATION: 2021 TAXSCAN (HC) 120

The Calcutta High Court directed the department to grant Input Tax Credit (ITC)  as all purchases, and transactions in question were genuine, made before cancellation of GST Registration.

The single bench of Justice Md. Nizamuddin held that all the purchases and transactions in question are genuine and supported by valid documents and transactions in question were made before the cancellation of registration of those suppliers and after taking into consideration the judgments of the Supreme Court and various High Courts which have been referred in this order and in that event the petitioners shall be given the benefit of input tax credit in question.

M/s. CIGFIL Retail Pvt. Ltd. vs Union of India & Ors. CITATION: 2021 TAXSCAN (HC) 469

The Calcutta High Court held that cancellation of GST registration of businesses on hyper-technical grounds adversely impacts employment and revenue.

The single-judge bench of Justice Md. Nizamuddin noted that it is not a case of tax evasion or causing revenue loss to the Government rather petitioner’s activity of carrying on the business which cannot be called illegal is creating revenue for the State as well as in helping the State to solve the problem of unemployment a little bit and such type of drastic action in the facts and circumstances of the case by canceling the registration of the petitioner on such hyper technical ground will not help the State rather it will cause revenue loss to the State as well as aggravate unemployment problem in the State which will be a social problem in the society.

M/S. S.S. Traders vs State Of U P And 3 Others CITATION: 2021 TAXSCAN (HC) 175

 The Allahabad High Court quashed the cancellation of GST Registration as no opportunity of hearing was accorded.

The single bench of Justice Jayant Banerji held that the denial of opportunity of hearing to the petitioner as is mandated in the first provision to sub-section (2) of Section 29 of the Act of 2017 vitiates the proceedings as well as the orders canceling the registration of the petitioner.

Eficaz Project Limited Liability Partnership vs Commissioner, Uttarakhand GST Commissionerate CITATION: 2021 TAXSCAN (HC) 498

The Uttarakhand High Court quashed the Order of cancellation of GST Registration due to the non-providing opportunity of Hearing and remitted the matter back to GST Authority.

The single bench of Justice Sharad Kumar Sharma ruled that even if the impugned order of 12th July 2021, is taken into consideration, there is not even a single whisper that after the expiry of 30 days, as provided under Sub-rule (3) Rule 22, when the cancellation was being resorted to, though apart from the fact that the officer concerned has become functus officio after the expiry of 30 days, even if at all, the cancellation was required, in that eventuality, then the petitioner ought to have been heard.

Suresh Trading Corporation vs The Asst. Commissioner (Circle) of SGST CITATION: 2021 TAXSCAN (HC) 198

The Madras High Court quashed the order for cancellation of GST Registration as Show Cause Notice did not mention date and time of personal hearing.

The single bench of Justice M.Sundar ruled that the impugned order being order for cancellation of GST Registration d is set aside solely on the ground that SCN which preceded the same has not been issued in the prescribed template i.e., REG- 17 under Rule 22(1) of TN-GST Rules, as it does not mention the date and time of personal hearing.

Suresh Trading Corporation vs The Asst. Commissioner CITATION: 2021 TAXSCAN (HC) 518

The Madras High Court quashed the cancellation of GST Registration as Show Cause Notice not issued in prescribed template.

The single judge bench of Justice M.Sundar held that the impugned order being order for cancellation of GST Registration is set aside solely on the ground that SCN which preceded the same has not been issued in the prescribed template i.e., REG- 17 under Rule 22(1) of TN-GST Rules, as it does not mention the date and time of personal hearing.

Cheema Local Carrier & Construction vs Assistant Commissioner SGST CITATION: 2021 TAXSCAN (HC) 270

The Chhattisgarh High Court stayed the cancellation of registration under GST as the order lacked Official examination.

The single judge bench of Justice Goutam Bhaduri held that the attachment order of the bank account and cancellation of registration do not show what grounds existed to pass such an order. Since the business of the petitioner stands closed for attachment of the bank account and cancellation of registration, strict compliance is required as per the Act and Rules.

M/s. Avon Udhyog vs State Of Rajasthan CITATION: 2021 TAXSCAN (HC) 322

The Rajasthan High Court held that the proceedings of cancellation of GST registration can not be kept hanging on pretext of assessee’s failure to file reply within the time.

The single judge bench of Justice Dinesh Mehta said that the proceedings of cancellation of registration cannot be kept hanging fire on any pretext, including that the assessee failed to file reply within the time allowed. Authority issuing the notice is statutorily bound to pass order in terms of sub-rule (3) of Rule 22 of the Rules. The Court observed that the petitioner has omitted to file reply within time allowed and even within 30 days of receiving the notice dated 04.02.2021, the present writ petition is disposed of with a direction to the petitioner to put forth all the submissions including the submission about automatic revocation of suspension advanced before this Court. Petitioner may file supplementary reply/written arguments.

M/S M.S. RETAIL PRIVATE LIMITED vs THE UNION OF INDIA  CITATION: 2020 TAXSCAN (HC) 194

The Karnataka High Court allowed the petitioner to file the application to revoke the cancellation of Goods and Service Tax (GST) registration before the Assistant Commissioner of Commercial Taxes, Bengaluru.

The Single Judge bench of Justice M.I. Arun held that the petition is disposed of granting liberty to the petitioner to file necessary applications seeking revocation of cancellation of registration. If such an application is submitted, respondent, the Assistant Commissioner of Commercial Taxes, Bengaluru, shall consider the same and pass appropriate orders, as expeditiously as possible and in any event, in an outer limit of two weeks.

PANKAJ COTTAGE vs GOODS AND SERVICE TAX OFFICER CITATION: 2022 TAXSCAN (HC) 1086

A single bench of the Kerala High Court has recently quashed the proceedings against the petitioner, M/s Pankaj Cottage for issuance of REG-31 instead of GST Registration Cancellation notice in Form GST REG-17.

Observing that, “Apart from the fact that Ext.P.5 (show cause notice) is issued in the wrong form, it is also bad for the complete absence of any detail.” and concurring with the judgment in Aggarwal Dyeing and Printing v. State of Gujarat, the Single Bench of Justice Gopinath P set aside the GST proceedings in favor of the petitioner. 

M/s. Shraddha Overseas Private Limited & Anr. vs The Assistant Commissioner of State Tax CITATION: 2022 TAXSCAN (HC) 1056

A two-judge bench of the Calcutta High Court has held that the transaction cannot be suspected merely on the grounds that the GST registration of the other-end dealer was canceled with retrospective effect.

The division bench observed that “the order passed by the appellate authority to be a non-speaking order in the sense that there is no independent finding rendered by the appellate authority qua the allegation against the appellants. Therefore, it is a fit case where the matter should be remanded back to the appellate authority to specifically consider the contentions, which was advanced by the appellants and also the fact that the other end dealer’s registration was canceled with retrospective effect

Aarcity Builders Private Limited vs Union of India and others CITATION: 2021 TAXSCAN (HC) 102

The Punjab & Haryana High Court has allowed the assessee to file application for Revocation of Cancellation of Registration wherein GST Registration was canceled before March 1, 2020 due to non-furnishing of returns for six months, extending the benefits of notifications dated August 29, 2021.

The division bench of Justice Ajay Tewari and Justice Pankaj Jain allowed the Writ Petition interpreting that the notification was issued in view of the COVID pandemic, wherein even the Supreme Court had passed a blanket order of extending the period of limitation.

Tvl. Suguna Cutpiece Center vs Appellate Deputy CITATION: 2022 TAXSCAN (HC) 1043

In a major relief to the taxpayers facing problems with restoration of GST registration even after payment of tax amount, penalty and filing of GST registration, the Madras High Court directed the GST department to restore such registrations in order to avoid problems to the taxpayers and the loss of revenue to the department.

The Court observed that “there are adequate safeguards under the GST enactments which can also be pressed against these petitioners even if their registration is revived so that, there is no abuse by these petitioners and there is enough deterrence against default in either paying tax or in complying with the procedures of filing returns.”

M/s.Raj Kishore Engineering Construction (P) Ltd vs The Joint Commissioner (Appeals) II CITATION: 2022 TAXSCAN (HC) 1006

A Single Bench of the Madras High Court has recently set aside the order canceling the GST Registration of the petitioner-Raj Kishore Engineering Construction Pvt Ltd in the absence of a Goods and Services Tax Appellate Tribunal. The matter was subsequently reversed to the First Appellate Authority

The Single Bench of Justice M Sundar observed that, “The Appellate Authority should have given some dispositive reasoning on this aspect of the matter. The Appellate Authority should have gone into the reasons adduced by the writ petitioner – assessee regarding the belated filing of returns and should have returned a finding one way or the other.” and set aside the impugned order reversing the matter to the appellate authority to consider the matter on merits in accordance with law.

WESTERN OFFSHORE & MARINE PROJECTS PVT. LTD vs STATE TAX OFFICER CITATION: 2022 TAXSCAN (HC) 964

The Kerala High Court has recently set aside the order canceling GST Registration of assessee, M/s Western Offshore & Marine Projects Pvt. Ltd.

The High Court Single Bench of Justice Gopinath P, thereby quashed the cancellation of registration and allowed the writ petition of the assessee, while saving the liberty of the revenue to initiate or continue the proceedings against the assessee in accordance with law.

Tvl.Marimuthu Venkateshwaran vs Commissioner CITATION: 2022 TAXSCAN (HC) 937

The Madras High Court granted relief to the assessee, Tvl Marimuthu Venkateshwaran on cancellation of registration due to non-filing of GST Returns due to health issues.

A Single Bench consisting of Justice Mohammed Shaffiq observed that “In view of the fact that this Court has been consistently following the directions issued in the case of Tvl.Suguna Cutpiece Vs Appellate Deputy Commissioner (ST) (GST) and others and the Revenue or Department has also accepted the said view as evident from the fact that no appeal has been filed in any of the matters, this Court intends to follow the above order of this Court.”

Parveez Ahmad Baba Vs Union Territory of JK and others CITATION: 2022 TAXSCAN (HC) 862

The Jammu and Kashmir & Ladakh High Court recently held that a Goods and Services Tax (GST) registration issued to the assessee and then canceled upon request cannot be revoked merely based on the property disputes with the brother of the applicant.

Observing that the proper course in law was to leave the concerned authority free to decide as to who, out of the two, fulfills the criteria for holding a license, the High Court held that “registration of the business unit, the same stands canceled” and restricted the operation/running of the Restaurant until the license has been granted in favor of the deserving party.

Chennai Krishnama Charyulu Karampudi vs Additional Commissioner CITATION: 2022 TAXSCAN (HC) 804

While considering a writ petition where the GST Registration canceled due to non-filing of GST returns, the Telangana High Court has directed the department to provide an opportunity of hearing as the statutory remedy is not available to the assessee due to the non-establishment of GST Tribunal.

A bench of Chief Justice Ujjal Bhuyan and Justice C.V.Bhaskar Reddy observed that “Accordingly and in the light of the above, we set aside the orders dated 05.10.2021 of respondent No.2 as well as the order dated 18.08.2022 of respondent No.1. Matter is remanded back to the file of respondent No.2 to consider the grievance expressed by the petitioner against cancellation of GST registration and thereafter pass an appropriate order in accordance with law.

M/S. DURGA RAMAN PATNAIK vs ADDITIONAL COMMISSIONER OF GST CITATION: 2022 TAXSCAN (HC) 763

A division bench of the Orissa High Court has allowed the assessee to file GST returns prior to the cancellation of registration and directed the Government to make suitable changes on the portal for the same.

Justice Jaswant Singh and Justice Murahari Sri Raman noted that the writ petition is maintainable challenging the order in appeal, albeit the petitioner is entitled to carry the matter before the Appellate Tribunal under Section 112 of the CGST Act inasmuch as even after lapse of 5 years, the said Appellate Tribunal is not constituted under Section 109.

CURIL TRADEX PVT. LTD vs COMMISSIONER CITATION: 2022 TAXSCAN (HC) 733

In a significant decision, the High Court of Delhi held that Physical verification for GST registration carried out in the absence of the assessee’s authorized representative is not valid and quashed the cancellation order of the Commissioner, Delhi Goods and Service Tax. A Coram of Mr Justice Rajiv Shakdher and Ms Justice Tara Vitasta Ganju observed that in the matter of registration under the GST Acts, the application of the trader has to be considered properly and proper opportunity shall be given to the applicant in the event of any negative approach by the authorities.

Ramani Suchit Malushte v/s. Union of India and Ors. CITATION: 2022 TAXSCAN (HC) 707

The Bombay High Court, in a significant ruling, held that where an Order of Cancellation of Registration under GST Act was uploaded on the GST Portal without signature, the limitation for filing appeal cannot start at all until the signature is affixed on such an order.

The High Court has held that the appeal was within time. Since the order was not signed as required by Rule 26(3) of the CGST Rules, the limitation could not begin from 14 November 2019. When the assessee went to take a physical signature at the time of filing of the appeal, that is on 19 May 2021, the limitation started running only from 19 May 2021.

Bisweswar Midhya vs Superintendent, CGST CITATION: 2022 TAXSCAN (HC) 678

The Calcutta High Court has held that GST registration cancellation would adversely affect the recovery of taxes and orders to revoke suspension of registration.

A Coram consisting of Justice T.S. Sivagnanam and Justice Prasenjit Biswas viewed that suspension of a license of a dealer will be counterproductive and would work against the interest of the revenue. “If the registration of a dealer is canceled, the dealer cannot carry on its business in the sense that no invoice can be raised by the dealer. This would ultimately impact the recovery of taxes.” Said the Tribunal.

M/S DILIPKUMAR CHANDULAL vs STATE OF GUJARAT CITATION: 2022 TAXSCAN (HC) 247

A division bench of the Gujarat High Court has directed the GST department to recall the order for cancellation of GST registration as the default on the part of the assessee was due to the mistake done by the Chartered Accountant who was handling the matter.

“ It was an inadvertent mistake committed by the Chartered Accountant which led to cancellation of the registration number of the proprietary ship,” the Court said.

 After considering the undisputed facts, the bench held that “We are of the view that the respondent No.2 should immediately look into the matter and see to it that the order canceling the registration is recalled and the original registration under the CGST is restored. For a mistake said to have been committed by the Chartered Accountant, the dealer under the Act should not be made to pay a very heavy price like cancellation of the registration itself.”

Aarcity Builders Private Limited vs Union of India and others CITATION: 2021 TAXSCAN (HC) 102

The Punjab & Haryana High Court has allowed the assessee to file application for Revocation of Cancellation of Registration wherein GST Registration was canceled before March 1, 2020 due to non-furnishing of returns for six months, extending the benefits of notifications dated August 29, 2021.

The division bench of Justice Ajay Tewari and Justice Pankaj Jain allowed the Writ Petition interpreting that the notification was issued in view of the COVID pandemic, wherein even the Supreme Court had passed a blanket order of extending the period of limitation. Moreover, once the petitioner had already been granted benefit of the notifications dated 23.04.2019, dated 25.06.2020 and dated 29.08.2021, the time limit for making such application should have extended up to 30.09.2021.

M/s. Bright Star Plastic Industries vs Additional Commissioner of Sales Tax CITATION: 2021 TAXSCAN (HC) 211

The Orissa High Court revoked the GST Registration Cancellation on the failure of the Department to prove the purchasing dealer deliberately availed of Input Tax Credit (ITC) knowing that the selling dealer was not in existence.

The division bench of Chief Justice Dr. S. Muralidhar and Justice B.P. Routray held that to attribute fraud in such circumstances to the Petitioner, as a purchasing dealer, the Department would have to satisfy a high threshold of showing that the purchaser indulged in the transactions with the full knowledge that the selling dealer was non-existent. The Department would have to show that somehow the purchasing dealer and selling dealer acted in connivance to defraud the revenue. This threshold has not been made in the present case.

M/S MAHADEV TRADING COMPANY vs UNION OF INDIA CITATION: 2020 TAXSCAN (HC) 155

The Gujarat High Court quashed the order for cancellation of registration as no date was fixed for hearing and no reply was awaited by the authority.

The division judge bench headed by the Chief Justice Vikram Nath without entering into the merits of the case held that the cancellation of registration resulting from the said show-cause notice also cannot be sustained as no proper opportunity of hearing was granted to the petitioner.

Re: M/s. JAYESH POPAT CITATION: 2023 TAXSCAN (AAR) 114

The Authority for Advance Ruling ( AAR ) of West Bengal of members Brajesh Kumar Singh and Jyojit Banik ruled that in the case the transaction of transfer of business by Merger of two registration comes under the ambit of ‘Supply of Services’.

The authority observed that the contention of the applicant that on the question whether the transaction would amount as supply of goods or supply of services, has referred to section 2(52) of the GST Act and contends that as business cannot be said to be movable, transfer of business cannot be said to be a transfer of goods.

Kala Coke and Chemicals Pvt. Ltd vs State of Bihar CITATION: 2023 TAXSCAN (HC) 106

A Division Bench of the Patna High Court (HC)restored GST Registration on non-consideration of response to Show Cause Notice (SCN) and delay amidst covid.

The Court noted that with the passing of the said order, petitioner is liable to both civil and penal consequences and that the Authority ought to have at least referred to the contents of the show cause and the response thereto, which was not done. The Bench opined that the order is not only the order is nonspeaking, but cryptic in nature and the reason of cancellation not decipherable therefrom. Principles of natural justice stand violated and the order needs to be quashed as it entails penal and pecuniary consequences.

DEE CUBES DIAMONDS PVT. LTD. Vs STATE OF GUJARAT CITATION: 2022 TAXSCAN (HC) 1104

A division bench of the Gujarat High Court has quashed an order canceling GST registration on the ground that the show-cause not does not contain the reasons for such an action.

Justice Sonia Gokani and Mrs. Justice Mauna M. Bhatt observed that no valid reason was given for cancellation of registration. Quashing the impugned order and directing re-adjudication, the High Court held that “Despite requested, no details were provided and prima facie reply of the petitioners have not been considered. To our opinion, the show-cause notice dated 26.05.2022 does not specify the reason for which the allegation of wrongful availment or utilization of Input Tax Credit (ITC) or refund of tax is made. As the show-cause notice does not contain reason to justify the action of the respondent, it is violative of principles of natural justice.

Umesh Kumar Vs State Of U.P. And 3 Others CITATION: 2022 TAXSCAN (HC) 960

The Allahabad High Court has held that the GST registration cannot be canceled merely on round of delay in filing of revocation application once the assessee filed all the returns and paid the dues and the Government has accepted the same.

Justice Rohit Ranjan Agarwal found that under Rule 23 of Rules, 2017, it has been specifically mentioned that the revocation application has to be preferred within 30 days from the date of service in order of cancellation of registration. The Court further observed that the purpose of inserting the provision under Rule 23 of Rules, 2017 as to service of notice upon the assessee is to provide an opportunity to him to move a revocation application so as to save the registration from being canceled permanently and his business being hampered.

Euro Pratik Sales Corporation vs Union of India and Ors CITATION: 2022 TAXSCAN (HC) 912

The Bombay High Court ordered Restoration of Canceled GST registration for ITC (Input Tax Credit) Transition of Rs thirty -nine lakhs

A Bench consisting of Justice K R Shriram and Justice AS Doctor observed that “Here is a case, in our view, petitioner cannot be permitted to forgo a sum of Rupees thirty-nine lakhs which according to petitioner is entitled to deemed excised credit particularly when under sub-section 3 of Section 29 his liability will continue even after cancellation of registration. It will be wholly unfair if the petitioner ends up having to forgo the deemed excise credit of a substantial amount.”

M/s.S.S.G.Apparels vs The Deputy Assistant Commissioner GST CITATION: 2022 TAXSCAN (HC) 801

The Madras High Court, while allowing a writ petition alleging cancellation of GST registration by mistake while modifying the form, directed to restore the same and asked the GST department to accept the registration manually as the petitioner was not able to apply the same online.

“The impugned order is set aside and the petitioner is permitted to make an application seeking restoration of registration, setting out the correct details of the principal and additional places of business,” the Court said. Concluding the order, the Court added that “Since the petitioner states that it will not be granted access online to file an application in view of the cancellation of registration, it is permitted to make the application manually before R1/Deputy Commissioner, GST (Central Taxes), who shall restore the registration within a period of two (2) weeks from date of receipt of the application.”

CURIL TRADEX PVT. LTD vs COMMISSIONER, DELHI GOODS AND SERVICE TAX & ANR. CITATION: 2022 TAXSCAN (HC) 706

In a significant ruling, the Delhi High Court has held that the physical verification of the business premises without notice for granting GST registration would be invalid as the same is in violation of the principles of natural justice.

The division bench of Justice Rajeev Shakdher and Justice Taravitasta Ganju observed that “A careful perusal of the rule shows that, if after the grant of registration, the proper officer is satisfied that physical verification of the place of business of the concerned person is required, the proper officer may get such verification of the business place carried out, albeit, in the presence of the said person, and thereafter, have the verification report along with other documents including photographs uploaded in Form GST REG30 on the common portal within 15 working days following the date of such verification.”

Tvl.Lucky Mydeen Briyani vs Commissioner CITATION: 2022 TAXSCAN (HC) 657

In a recent ruling, the Madras High Court, while considering a petition challenging the cancellation of GST registration due to non-compliance during the pandemic, held that keeping businesses out of tax regime would adversely affect the interests of revenue.

Justice M.Nirmal Kumar observed that the petitioner during the Covid-19 pandemic period had not filed his returns and thereafter, he had not conducted any business so that he filed only nil returns.

APCO AUTOMOBILES PRIVATE LIMITED, Vs SUPERINTENDENT OF CENTRAL TAX AND CENTRAL EXCISE,  CITATION: 2022 TAXSCAN (HC) 406

The Kerala High Court has admitted a petition challenging the errors in GST system including non-acceptance of return without payment of tax amount, causing multiple loss to the assessee including payment of late fee, interest and cancellation of GST registration etc.

While admitting the petition, Justice T R Ravi directed the department to open the GST site for the petitioners to continue with the trading activities. The grievance of the petitioner was that there was no option on the GST system to file the return without making the payment. If the option was there, the petitioner could file the return and pay the tax amount along with interest, as permissible under the GST law.

RAJDHANI SECURITY FORCE PVT. LTD. vs UNION OF INDIA CITATION: 2022 TAXSCAN (HC) 379

A division bench of the Madhya Pradesh High Court comprising Justice Sheel Nagu & Justice Maninder S. Bhatti has upheld an order dismissing appeal against cancellation of GST registration on account of delay of 18 months in filing statutory appeal without a reasonable cause.

The division bench has held that “Thus, the total period during which the appeal ought to have been preferred was four months from the date of cancellation of registration dated 19.06.2019. However, despite a lapse of four months, the appeal was not preferred by the appellant/petitioner, nor even in the memo of appeal, sufficient reasons for not filing the appeal in time were disclosed. There was an unexplained delay of 1 ½ years in filing the appeal.”

VIMAL YASHWANTGIRI GOSWAMI vs STATE OF GUJARAT CITATION: 2022 TAXSCAN (HC) 342

The Gujarat High Court last week granted bail to an accused for allegedly being involved in the offense of evading input tax credit under the GST regime.

Justice A. S. Supehia observed that the total tax evasion of the applicant’s Company Heugo Metal is shown as Rs.4,51,05,130/- which is less than 5 crores. It is further revealed that the tax liability of other company being Dattatrey Corporation, concerning the accused No.3, is also added and the total tax evasion of both the companies, is shown as Rs.7,55,76,378/-., i.e. above 5 crores. Both the companies are a separate and distinct identity having different GST numbers.

AGGARWAL DYEING AND PRINTING WORKS vs STATE OF GUJARAT CITATION: 2022 TAXSCAN (HC) 281

A division bench of the Gujarat High Court comprising Justice Nisha Thakore and Justice J. B. Pardiwala has asked the Government to take care of the technical glitches in the GSTN at the earliest and slammed the Government that the High Court is flooded with the litigations due to such glitches.

Allowing the petition on ground of violation of natural justice principles, Justice Nisha Thakore observed that “our concern is that on account of procedural lapses, the High Court should not be flooded with writ applications. The procedural aspects should be looked into by the authority concerned very scrupulously and diligently. Why unnecessarily give any dealer a chance to make a complaint before this Court when it could have been easily avoided by the department.

Marketing Private Limited vs State Of U.P. And 3 Others CITATION: 2022 TAXSCAN (HC) 273

The Allahabad High Court has held that the GST registration cannot be canceled merely for the reason that a firm is described as “bogus” under the provisions of the Central Goods and Services Tax Act, 2017.

the Court held that “therefore, the registration once granted could be canceled only if one of the five statutory conditions was found present. Per se, no registration may be canceled by merely describing the firm that had obtained it, as “bogus”. The word “bogus” has not been used by the statute. The only contingency to which such expression may relate may be one appearing under Clauses (c) and (d) of Section 29(2) of the Act where a registered firm does not commence its business within six months of its registration. Other than that, the term “bogus” may also refer to a satisfaction contemplated by Section 29(2)(c) of the Act where registration may be canceled if the registered firm has not furnished its return for a continuous period of six months. Those conditions have not been shown to exist in this case.”

SSG FURNISHING LLP vs ASSISTANT COMMISSIONER, CENTRAL GOODS AND SERVICE TAX, DIVISION- BAWANA & ORSCITATION: 2022 TAXSCAN (HC) 243

The Delhi High Court, last week admitted a petition by SSG Furnishing LLP challenging the constitutional validity of Rule 21A of CGST Rules being violative of Article 19(1)(g) of the Constitution of India and a show-cause notice issued to propose removal of the Suspension of GST registration.

While granting interim relief to the petitioner,Justice Manmohan Justice and Dinesh Kumar Sharma held that “since in the present case, the petitioner’s registration has been lying suspended for more than forty days on the basis of a show cause notice which is bereft of any reason or fact, this Court stays the impugned notice dated 14th List on 4 February, 2022 and directs forthwith restoration of the GST Registration of the petitioner.”

M/S J.K Infratech vs Additional Commissioner And Another CITATION: 2022 TAXSCAN (HC) 183

The Allahabad High Court has held that while considering the fact that the period of limitation stood suspended by the Apex Court and the High Court from 15.3.2020 to 14.3.2021, that period shall be excluded while computing the statutory period for filing GST appeals.

Justice Saumitra Dayal Singh held that “In view of the above facts, the present petition deserves to be allowed as the limitation to file first appeal under Section 107 of the U.P. GST Act, 2017, was three months with delay condonable for a period of one month. Once the order dated 17.9.2019 is taken to have been served on the petitioner on 31.8.2020, then in view of the suspension of limitation from 15.3.2020 to 14.3.2021 the limitation to file the appeal would start running from 15.3.2021. In that case, the appeal having been filed on 19.3.2021, the same was wholly within time.”

NICO TILES MADHAVAM vs THE STATE TAX OFFICER, STATE GOODS AND SERVICE TAX DEPARTMENT CITATION: 2022 TAXSCAN (HC) 130

The Kerala High Court has held that the Taxpayer cannot invoke writ jurisdiction and approach the High Court to avoid the mandatory pre-deposit since the matter is already pending before the Statutory appellate authority under the Central Goods and Services Tax Act, 2017.

Dismissing the petition, the High Court held that “In view of the above consideration, this Court is of the view that since the petitioner had already invoked the appellate remedy, the said appeal ought to be pursued as contemplated by law. The remedy of Article 226 of the Constitution of India being extraordinary, I do not find the existence of any circumstances warranting the invocation of the extraordinary jurisdiction, after invoking such an appellate remedy.”

Latika Ghosh VS The Commercial Tax Officer/Assistant Commissioner CITATION: 2022 TAXSCAN (HC) 149

A two-judge bench of the Calcutta High Court, while allowing a writ petition against the order of the GST department to revoke GST registration due to non-filing of returns, held that the registration must be restored in 7 days.

Allowing the writ petition, the Court observed that “the authorities are directed to restore the appellant’s certificate of registration under the provisions of both West Bengal Goods & Service Tax Act and Central Goods & Service Tax Act within one week from the date of receipt of the copy of this order. We grant liberty to the authorities to issue show cause notice to the appellant. In case there is any shortfall in remittance of the late fees and interest payable by the appellant and if, according to the appellant, all dues have been settled, they are entitled to submit a reply which shall be considered and a speaking order be passed in accordance with law.”

Tvl. Suguna Cutpiece Center vs Appellate Deputy CITATION: 2022 TAXSCAN (HC) 1043

In a major relief to the taxpayers facing problems with restoration of GST registration even after payment of tax amount, penalty and filing of GST registration, the Madras High Court directed the GST department to restore such registrations in order to avoid problems to the taxpayers and the loss of revenue to the department.

The Court, while allowing the writ petitions, opined that the purpose of GST registration is only to ensure just tax gets collected on supplies of goods or service or both and is paid to the exchequer. “Keeping these petitioners outside the bounds of the GST regime is a self-defeating move as no tax will get paid on the supplies of these petitioners,” the Court said.

SHAKTI SHIVA MAGNETS PRIVATE LIMITED vs ASSISTANT COMMISSIONER & ORS. CITATION: 2022 TAXSCAN (HC) 190

The Delhi High Court has quashed the show cause notice as GST registration cannot be suspended for more than 2 months without Stating Reasons.

The division bench of Justice Manmohan and Justice Navin Chawla observed that the impugned SCN contains no fact or reasons and is not supported by any document based on which the Petitioner’s registration could be suspended.

M/S S.R. Steel vs State Of U.P. And 2 Others CITATION: 2021 TAXSCAN (HC) 480

The Allahabad High Court quashed the Order canceling GST Registration as no prior show cause notice was issued.

The division bench of Justice Naheed Ara Moonis and Justice Saumitra Dayal Singh noted that the show cause notice dated 5.4.2018 as served on the petitioner was an unintelligible and a physical copy of the said notice was not served at the relevant time, the order canceling the petitioner’s registration is found to be wholly ex-parte being contrary to the mandatory requirement of the first proviso to Section 29(2) of the Act. As to the delay, the petitioner has explained the same on account of the spread of the pandemic COVID-19.

“We lift the bar of alternative remedy as we find that the petitioner’s registration was canceled without the issuance of any prior show-cause notice. Also, the delay is largely on account of the conduct of the State respondents or conduct attributable to the State respondents as they alone were responsible to update the information on the GST Portal. That not done, the petitioner/citizen may not be relegated to the forum of alternative remedy as his valuable right to do business has been curtailed in violation of the principle of natural justice,” the court said.

International Value Retail Private Limited vs Union of India & Ors.CITATION: 2021 TAXSCAN (HC) 519

The Calcutta High Court held that the GST registrations cannot be canceled for not operating from premises due to COVID-19.

The single Judge Bench of Justice Md. Nizamuddin quashed the impugned order and directed the respondent authority to consider afresh and dispose of the petitioner’s application for revocation of cancellation of its registration of the petitioner under GST Act in accordance with law and bypassing a reasoned and speaking order after giving the opportunity of hearing to the petitioner or its authorized representative within four weeks from the date of communication of this order and also to consider the documents to be placed by the petitioner in support of its contention at the time of the hearing.

F R TRADE LINKS vs THE STATE TAX OFFICER  CITATION:  2021 TAXSCAN (HC) 553

The Kerala High Court has ruled that, GST Authority has No Power to cancel the registration of a person for Reasons not specified in the GST Act. The High Court directed the GST Authority to restore the GST registration as the receipt of the building tax was not considered.

The court held that The proper officer, as such, ought not to have proceeded ahead with the cancellation of the registration on the basis of a report of the intelligence officer. The proper officer ought to have independently assessed the situation, particularly, when the petitioner had produced the receipt of the building tax from the local authority to prove the authenticity of his stand. This seems to have not been done by the proper officer. Without considering this document, the registering authority had canceled the registration. The application for revocation of cancellation of registration is also rejected by the respondent without proper enquiry in the matter.

OPC Assets Solutions Pvt. Ltd. vs THE STATE OF TRIPURA CITATION:  2021 TAXSCAN (HC) 560

The Tripura High Court ruled that the Order demanding Unpaid GST for different tax periods by issuing Show Cause Notice only for 1 year is invalid.

The division bench of Justice S.G. Chattopadhyay and Justice Akil Kureshi said, “in the age of internet and availability of information through technology, the Superintendent of Taxes was not precluded from doing his own homework and finding out material which was useful for the purpose of the case that he was deciding. However, any use of such material must precede sharing of it with the person likely to be adversely affected by his order. The basic requirement of the principle of natural justice for sharing adverse material before utilizing the same against a person must be observed with greater rigor in the times of availability of information on the internet, all of which need not necessarily be accurate at all times. Accurate or otherwise the notice must have a chance to meet with such adverse material before it is used against him. For each individual reason, namely, the order being unintelligible, the action failing the test of principles of natural justice, and the Superintendent of Taxes exceeding the show-cause

notice, the impugned orders must be set aside. For sheer verbosity, the orders must go.”

RAMKY- TK JV vs THE UNION OF INDIA AND 6 ORS  CITATION:  2021 TAXSCAN (HC) 262

The Gauhati High Court directed the early determination of the issue in order to restore the GST Registration as well as to enable the portal to make further returns and also pay the subsequent taxes.

The single-judge bench of Justice Achintya Malla Bujor Barua while listing the matter after two weeks for hearing held that an early determination of the issue is required to be made. If the issue raised would be adjudicated in favor of the writ petitioner, the same would entail a restoration of its registration as well as to enable the portal to make further returns and also pay the subsequent taxes. On the other hand, if the issue is decided against the writ petitioner, the same would have its own consequence.

M/S Ansari Construction vs Additional Commissioner Central Goods And Services Tax CITATION: 2021 TAXSCAN (HC) 446

The Allahabad High Court will ascertain the liability of GST Official towards software glitches causing harassment of poor assessees.

The single-judge bench of Justice Pankaj Bhatia observed that the appellate authority has also committed the same manifest arbitrariness in deciding the appeal, the recording of the reason that facts cannot be verified at the appellate level is wholly arbitrary and militates against the whole purpose of statutory appeal under an enactment. The court stayed direction for payment of cost as against the applicant and the observations shall remain till the next date of hearing i.e. February 3, 2021.

MADHAV MOTORS vs STATE TAX OFFICER CITATION:  2020 TAXSCAN (HC) 142

The Kerala High Court directed the authority to permit the petitioner to upload the returns for the past period to avail eligible Input Tax Credit (ITC).

The Single Judge Bench of Justice Jayasankaran Nambiar held that when the provisional registration granted to the petitioner was not canceled through the procedure contemplated under the Act and Rules, and the respondents had granted a regular registration on January 4, 2020, the permanent registration must relate back to the date of the provisional registration and the petitioner ought to be entitled to upload the returns for the past period and to avail eligible input tax credit based on the returns uploaded by him.

M/s.Suvarna Traders vs Assistant Commissioner of State Tax CITATION:  2022 TAXSCAN (HC) 1058

In a recent decision, the Telangana High Court, chaired by Chief Justice Ujjal Bhuyan and Justice C.V. Bhaskar Reddy, set aside the contested order of the Assistant Commissioner (ST) and issued re-adjudication. In this case, due to the petitioner’s inability to use the portal as a consequence of the department’s cancellation of the GST registration, the petitioner in this matter didn’t receive the department’s show reason notice or reminder notice.

The bench set aside the impugned order and instructed to initiate a fresh adjudication. Thereafter the court directed that the Assistant Commissioner (ST), shall pass appropriate order after giving due opportunity of hearing to the petitioner, including personal hearing.

M/s Best Bricks vs The Union of India CITATION:  2022 TAXSCAN (HC) 1032

The Patna High Court Division bench of Chief Justice Sanjay Karol and Justice Partha Sarathy while entertaining a Writ Petition through Video conferencing, quashed the order of Joint Commissioner of State Taxes (JCST) and restored the Goods and Services Tax (GST) Registration of the petitioner.

The court stated that the principles of natural justice were violated and the order needs to be quashed as it entails penal and pecuniary consequences. Furthermore, it was stated that the petitioner consistently filed its return on time. And as per the submissions made by the counsels of the petitioner, the information of the returns for a certain period was not being uploaded was due to the Covid Pandemic which is not in the hands of the petitioner

. As a result, the bench ordered to revoke the contested ruling of JCST and instructed the relevant authority to complete the petitioner’s assessment orders in compliance with the law.

Subodh Kumar Garg vs Union of India CITATION: 2022 TAXSCAN (HC) 856

The Allahabad High Court has, recently while granting bail to a GST accused, held that seriousness of the offenses alone cannot be conclusive of the applicant’s entitlement to bail. The aforesaid observation was made by the Tribunal when a bail application had been filed on behalf of the applicant, Subodh Kumar Garg, with a prayer to release him on bail in File No. DGGI/ARU/Gr.B/S. Traders/23/2021, ,under Sections 132(1)(c) of the Central Goods and Service Tax Act,2017 DistrictAgra, during pendency of trial.

The Allahabad High Court has, recently while granting bail to a GST accused, held that seriousness of the offenses alone cannot be conclusive of the applicant’s entitlement to bail. The aforesaid observation was made by the Tribunal when a bail application had been filed on behalf of the applicant, Subodh Kumar Garg, with a prayer to release him on bail in File No. DGGI/ARU/Gr.B/S. Traders/23/2021, ,under Sections 132(1)(c) of the Central Goods and Service Tax Act,2017 DistrictAgra, during pendency of trial.

Vageesh umesh jaiswal v. State of GujaratCITATION:  2022 TAXSCAN (HC) 1112

The Gujarat High Court has  quashed the cancellation of GST registration on ground of vague show-cause notice bereft of any material particulars.

details of the name of the supplier etc. had been furnished. The division bench of Justice J.B.Pardiwala and Justice Nisha M.Thakore held that this litigation has really disappointed us and that too at the end of a tiring day.  “We are disappointed for two reasons; first the mode and manner in which the entire exercise has been undertaken by the Commercial Tax Officer in canceling the registration and secondly the vehemence with which the learned AGP has opposed this writ application despite serious shortcomings in the impugned action. When we pointed out to the learned AGP that the show-cause notice is as vague as anything, the learned AGP very vehemently maintained that the show-cause notice contains the minutest of the details on the basis of which the writ applicant could have given a proper and effective reply,” the court added.

Jud Cements Ltd. vs The Commissioner of Central Goods and Service Tax and Central Excise & ors CITATION: 2022 TAXSCAN (HC) 415

In a recent order, the division bench of the Meghalaya High Court has declined the plea of the assessee spreading out the overdue amount over the rest of the installments.

The division bench comprising Chief Justice Sanjib Banerjee, and Justice W. Diengdoh observed that “the petitioner herein having cried wolf without justifiable cause in the past for the petitioner’s more worthy subsequent plea to be somewhat diluted by the previous conduct. By the order dated December 7, 2021, the petitioning assessee was permitted to pay the entire outstanding amount of Rs.43,49,50,071/- in 24 equal or nearly equal monthly installments beginning December 15, 2021 and payable by the 15th day of the 23 succeeding months.”

Om Trading Co  v Deputy commissioner of state tax  CITATION:   2022 TAXSCAN (HC) 1116

The Madhya Pradesh High Court held that the failure to produce necessary documents will lead to cancellation of registration for supply of goods.

The court held that the judgments relied on by the learned counsel for the appellant are of no assistance to the appellant inasmuch as the facts of those cases and the present case are altogether different. In the present case, in the detailed inquiry, it was found that no material was physically transferred from Agra to Gwalior.

Kans Wedding center v commissioner of commercial taxes Thiruvananthapuram  CITATION: 2021 TAXSCAN (HC) 675

The Kerala High Court directed the Kans Wedding Centre to approach the proper officer for preponement of proceedings for cancellation of registration.

The court held that the proceedings for cancellation of registration will continue for a long period and till then his registration is under suspension causing loss to his business can be taken care of by directing the petitioner to approach the proper officer for preponing the date.

Lakhan singh chauhan & company v. union of India (2020)(High Court of Madhya Pradesh)

Competent authority canceled the registration of the assessee on the ground that it had failed to furnish a return for a continuous period  of six months.appellate authority rejected the appeal filed by assessee on ground of delay.

The High Court observed that there was no consideration to grounds mentioned            in the memo of appeal regarding noncommunication in order to assess and start the period of limitation from date of communication or knowledge of order.The appellate authority had passed the said order without considering the aforesaid grounds.

Appellate authority shall consider all grounds of appeal before rejection.

Great sands consulting (p.) Ltd v. union of India(2020)(High Court of bombay)

  The High Court observed that since the impugned  order had been passed without considering reply to show cause and on the ground that no reply was filed.

The court set aside the order canceling registration where it passed without considering the taxpayer's reply.

Bright steels Ltd.v The state Tax officer (2021)(Madras)

HC noted that for the fraud committed by the selling dealer which resulted in the cancellation of a sale’s dealer registration ,There cannot be an automatic cancellation of the registration of the purchasing dealer.

Vidyut  Majdoor kalyan samiti v state of uttar pradesh (2021)(Allahabad)

In this case the petitioner failed to file monthly returns (GSTR-3B) for more than six months for the period from October to March in assessment year 2018-19 and from April to June in assessment year 2019-20 as required under the Goods and Service Tax Act, 2017, a show cause notice was uploaded on the GST Portal on 22.08.2019 granting seven days time to the petitioner to show cause.

The court held that  there is no provision of restoration of a GST registration, once it has been canceled borders on the absurd. In case, no provision for its restoration has been made in the software, the same is not the fault of the petitioner and it is for the department and the respondents to make provisions for the same in the software and on the GST Portal. Merely because such provision has not been made, the petitioner cannot be made to suffer and non compliance of an appellate order, passed by a competent appellate authority cannot be accepted or permitted on the plea raised in the counter affidavit or during the course of arguments.

Accordingly, the writ petition is liable to be and is hereby, allowed. The respondents are directed to restore petitioner's GST registration on the GST Portal, forthwith not later than ten days from the date a copy of this order is filed before them.

Shah industries v state of Gujarat (2022)(Gujarat)

Taxpayer contented that the  show cause notice is bereft on any material particulars or information. In the absence of any material particulars and the details, it is difficult for any individual to respond to such a vague show cause notice. Probably what the Authority is trying to convey is that the registration had been merely on paper and no actual business activity was found on the place of business, as the writ applicant - a registered person was not found at the place of business

HC set aside the show cause notice issued without any material reason for cancellation of registration.

unique instruments and mfrs. (p.)ltd. v state of karnataka

In this case, The petitioner submitted that in terms of Section 29(2) of KGST Act, the proviso would require that the proper officer will not cancel the registration without giving the person an opportunity of being heard. It is submitted that no such opportunity of hearing was afforded.

The order of cancellation observes that the reply and submissions of the petitioner has been examined at the time of hearing that by itself would not indicate that the petitioner was present during the hearing of the proceedings leading to cancellation of registration. It is clear as per the provision to Section 29(2) of KGST Act that there shall not be cancellation without giving the person an opportunity of being heard in light of the statutory mandate and in absence of any material evidence, presence of the petitioner during the proceedings for cancellation of registration.

Asean Aromatics (P) Ltd  v Assistant commissioner (2019)(Madras)

M/s. Asean Aromatics Private Limited  filed petition against order regarding cancellation of registration on the ground that Form GSTR-3B return have not been filed .In response to a show cause notice received on dated October 14, 2018 for cancellation of registration, petitioner contented that delay was on account of severe working capital shortage and the enhancement of working capital was awaited and the dues would be settled at the earliest.The petitioner further contended to pay pending GST dues in six monthly installments, a sum of Rs.10,00,000/- having been paid as first installment on December 14, 2018.

The  Court of Madras held that the authorities, both Centre and State, have taken into consideration the fact that GST is nascent in its application and is an evolving regime. The interests of small traders have thus weighted consideration with the authorities in granting the relaxation in time limits.

Further the High Court directed the authority to, considering the facts that assesses face technical difficulties and not engaged in any business transactions on account of the cancellation of registration for the last four months, allows assesses to pay GST dues in six monthly installments.

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