GST Appeal Dismissed Without Reasons: Himachal Pradesh HC Terms it “Denial of Justice”, Sends Case to Appellate Authority [Read Order]

The Himachal Pradesh High Court has quashed an appellate order dismissing a GST ( Goods and Services Tax ) appeal merely on the ground of delay without assigning any reasons.

The Court stated that failure to provide reasons amounts to a denial of justice and remanded the matter back to the appellate authority for fresh adjudication.

The petitioner, Anil Kumar, a registered GST taxpayer and owner of a commercial vehicle, had challenged the cancellation of his GST registration on account of non-filing of returns from April 2023 to February 2025.

He contended that despite the delay, his tax liability had been discharged and that the cancellation of registration was disproportionate to the alleged non-compliance. Subsequently, his appeal against the cancellation was rejected by the appellate authority citing a 277-day delay, without offering any detailed reasoning or justification.

The High Court, while hearing the writ petition, noted that such rejection without assigning reasons reflects non-application of mind and violates the principles of natural justice.

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The bench observed that “Failure to give reasons amounts to denial of justice. Reasons are live links between the mind of the decision-taker to the controversy in question and the decision or conclusion arrived at.”

“Arbitrariness in making of an order by an authority can manifest itself in different forms. Non- application of mind by the authority making the order is only one of them. Every order passed by a public authority must disclose due and proper application of mind by the person making the order. Application of mind is best demonstrated by disclosure of mind by the authority making the order and disclosure is best done by recording the reasons that led the authority to pass the order in question” said the court.

Quoting from Supreme Court rulings, the Division Bench comprising Justice Tarlok Singh Chauhan and Justice Sushil Kukreja reiterated that “reason is the heartbeat of every conclusion,” and a quasi-judicial authority must record clear, cogent, and reasoned orders to ensure transparency, fairness, and judicial accountability.

Justice Tarlok Singh Chauhan and Justice Sushil Kukreja added that “Thus, what stand settled by today is that the administrative authority and the tribunal are obliged to give reasons, absence whereof would render the order liable to judicial chastisement. Once the reason has not been assigned by the competent authority for levying the penalty, then, on this ground alone, the impugned orders cannot be sustained.”

The court, holding the impugned order as legally unsustainable, set it aside and directed the appellate authority to hear the matter afresh and pass a reasoned, speaking order after granting the petitioner a fair opportunity of hearing. The matter is to be decided expeditiously, no later than August 14, 2025.

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