Proceedings of Cancellation of GST Registration can’t be kept hanging on pretext of Assessee’s failure to file reply within the time: Rajasthan HC [Read Order]

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 petitioner, M/s. Avon Udhyog has challenged notice-cum-order, vide which, petitioner’s registration certificate has been suspended.

Mr. Sharad Kothari, counsel for the petitioner, submitted that pursuant to the notice of cancellation of registration dated 04.02.2021, petitioner has furnished his detailed reply/ response on 20.03.2021, yet the respondents have not passed any final order regarding petitioner’s registration, due to which petitioner’s right to trade has been kept in suspended animation.

Mr. Kothari highlighted the provisions contained in Section 29 of the Rajasthan Goods and Service Tax Act, 2017, amended vide Finance Act, 2020 and Rules 21 and 22 of the Rules framed thereunder, Mr. Kothari, learned counsel for the petitioner, submitted that though suspension of registration certificate does not envisage grant of opportunity of hearing in express terms, but the principles of natural justice warrants that before suspending a license, a reasonable opportunity of hearing must be granted to an assessee.

He submitted in the alternative, that the Assessing Authority is required to take a final decision pursuant to notice of cancellation of registration at the earliest, so that a businessman’s fundamental rights enshrined and guaranteed under Article 19(1) (g) of the Constitution of India are not kept in abeyance on account of suspension of registration.

Mr. Hemant Dutt, counsel for the respondents, submitted that petitioner, who was required to file reply to the notice within a period of 7 days, has failed to file reply within the stipulated time and the same came to be filed as late as on 20.03.2021. Hence, the petitioner cannot raise a grievance and level allegation of protraction of the proceedings by the respondent Assessing Authority.

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.

The court directed the petitioner and his representative to personally appear before the respondent on 07.07.2021, who, in turn, shall provide opportunity of hearing to the petitioner and pass speaking order in accordance with law on or before 14.07.2021.

To Read the full text of the Order CLICK HERE

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