In a significant case, the Delhi High Court modified the retrospectively canceled Goods and Service Tax ( GST ) registration from the date of issue of a Show Cause Notice ( SCN ).
The writ petition was filed by the petitioner Ansh Telecom against the retrospectively canceled GST registration .The Petitioner was engaged in the business of trading mobile phones and tablets and possessed GST Registration under the Central Goods and Services Tax Act, 2017 .
Before the division bench counsel for the petitioner submitted that the Show Cause Notice dated 02.09.2021 was issued to the Petitioner seeking to cancel its registration. Though the notice does not specify any cogent reason.
Further argued that Said Show Cause Notice required the petitioner to appear before the undersigned i.e. authority issuing the notice on 02.10.2021 at 11:00. However, the said Notice does not bear the name of the designation of the officer where the petitioner had to appear.
Although the said Show Cause Notice also does not put the petitioner to notice that the registration is liable to be canceled retrospectively. Thus, the petitioner had no opportunity to even object to the retrospective cancellation of the registration.
Counsel for Petitioner further submits that on account of financial constraints, Petitioner is no longer continuing the business.The business activities of the Petitioner have been closed down since 31.03.2021. He further submits that Petitioner has filed all returns till March 2021.
It was observed by the court that the notice that Show Cause Notice and the impugned order are also bereft of any details. Accordingly, the same cannot be sustained. Neither the Show Cause Notice, nor the order spell out the reasons for retrospective cancellation.
Further no opportunity was given to the Petitioner to clarify its reply or furnish further documents/details. Also the Petitioner and the department want cancellation of the GST registration of the Petitioner, though for different reasons
After analyzing the facts and arguments of both parties, a division bench of Justice Sanjeev Sachdeva and Justice Ravinder Dudeja held that “order dated 27.12.2021 is modified to the limited extent that registration shall now be treated canceled with effect from 02.09.2021 i.e., the date of the issue of the Show Cause Notice”
Mr. Vineet Bhatia and Mr. A. Jaganath Mishra, Advocates appeared for the petitioner and Mr. Rajeev Aggarwal, ASC with Ms. Shaguftha H. Badhwar, Mr. Prateek Badhwar and Ms. Samridhi Vats, Advocates appeared for the respondent.
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