GST Registration to be treated as Cancelled from Date of Application for Cancellation of Registration: Delhi HC [Read Order]

In a recent decision, the Delhi High Court ruled that the GST registration is to be treated as cancelled from date of application for cancellation of registration.

The Petitioner impugned the order dated 03.01.2024 whereby the application seeking cancellation of GST registration of the Petitioner has been rejected. Vide impugned order dated 03.01.2024, petitioner’s application seeking cancellation of GST registration was rejected for the following reason:- “The taxpayer neither attended personal hearing on stipulated date and time nor submitted requisite reply against the query raised. Accordingly, request for cancellation of GST registration is rejected under the provision laid down in Section 29 of CGST Act, 2017.”

The counsel for petitioner submitted that due to financial stringency to continue business, the petitioner had closed down all business activities and was no longer interest in continuing the business. Petitioner filed an application for cancellation of GST registration w.e.f. 21.11.2023.

Thereafter, impugned order dated 03.01.2024 rejected the application for cancellation of GST registration. The said order merely states “The taxpayer neither attended personal hearing on stipulated date and time nor submitted requisite reply against the query raised. Accordingly, request for cancellation of GST registration is rejected under the provision laid down in Section 29 of CGST Act, 2017.”

A Division Bench of Justices Ravinder Dudeja and Sanjeev Sachdeva observed that “In our view, order dated 03.01.2024 does not qualify as an order rejecting the application seeking cancellation of GST registration as the same is bereft of any details or reasons and accordingly the same cannot be sustained. In view of the above the order dated 03.01.2024 is set aside. The application of the Petitioner seeking cancellation is allowed. The GST registration of the Petitioner shall now be treated as cancelled with effect from 21.11.2023 i.e., the date when the petitioner applied for cancellation of GST registration.”

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