SCN for Cancellation of GST Registration without stating any reason is void: Delhi HC [Read Order]

The Delhi High Court (HC) held that a Show Cause Notice (SCN) for cancellation of GST registration without stating any reason is void.

Spinns International, the petitioner has filed the petition to direct the respondents to reinstate the GST registration of the petitioner.

The petitioner was registered under the Central Goods and Services Tax Act, 2017 from 17.12.2021. It was claimed that on 27.05.2022, it applied to the concerned authorities for amendment of certain particulars, which were accepted. The respondent issued a show-cause notice proposing to cancel the petitioner’s registration.

It was contended by the petitioner that the show cause notice does not specify any allegation capable of being responded to. Further stated that it was settled law that the purpose of the show cause notice is to enable the notice to meet the allegations based on which an adverse action is proposed.

The petitioner’s registration was cancelled by an impugned order dated 11.10.2022. The petitioner, understandably, did not respond to the impugned show cause notice. The petitioner’s registration was cancelled on the ground that the petitioner had neither appeared for a personal hearing nor submitted any reply.

The petitioner has been pursuing the concerned authority for disposal of its application for revocation of the cancellation order dated 11.10.2022 but in vain. Concededly, no statutory provision requires a taxpayer to seek a NOC from any authority for moving an application for revocation or cancellation of its registration.

A two-member comprising of Justice Vibhu Bakhru and Justice Amit Mahajan observed that the respondent’s procedure for cancellation of the registration is flawed. The impugned show cause notice cannot be considered a show cause notice at all. The Court set aside the impugned order dated 11.10.2022, cancelling the petitioner’s registration, which has been passed in violation of the principles of natural justice.

To Read the full text of the Order CLICK HERE

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