GST SCN Merely Reproduced S. 29(2)(e) Instead of Stating Reason for Registration Cancellation: MP HC sets aside Notice & Order [Read Order]
The Court quashed a GST show cause notice and cancellation orders and held that the notice was invalid for merely reproducing Section 29(2)(e) of the GST Act without specifying reasons for the proposed cancellation.
![GST SCN Merely Reproduced S. 29(2)(e) Instead of Stating Reason for Registration Cancellation: MP HC sets aside Notice & Order [Read Order]](https://images.taxscan.in/h-upload/2025/07/09/2061948-gst-cancellation-notice.webp "GST SCN Merely Reproduced S. 29(2)(e) Instead of Stating Reason for Registration Cancellation: MP HC sets aside Notice & Order [Read Order]")
The Madhya Pradesh High Court has set aside a show cause notice (SCN) and GST registration cancellation orders as it failed to provide specific reasons for the cancellation, merely citing Section 29(2)(e) of the Goods and Services Tax Act, 2017. Virendra Singh Thakur (petitioner) filed a writ petition under Article 226 of the Constitution of India. The petitioner sought to quash the...
The Madhya Pradesh High Court has set aside a show cause notice (SCN) and GST registration cancellation orders as it failed to provide specific reasons for the cancellation, merely citing Section 29(2)(e) of the Goods and Services Tax Act, 2017.
Virendra Singh Thakur (petitioner) filed a writ petition under Article 226 of the Constitution of India. The petitioner sought to quash the SCN, cancellation orders, and recovery notice, which had frozen his bank account and raised a tax demand.
The petitioner obtained GST registration on 6th July 2018 for his business as a contractor with the Military Engineering Services (MES). The GST authorities issued an SCN proposing cancellation of his registration under Section 29(2)(e) of the GST Act, 2017.
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It permits cancellation if registration was obtained through fraud, willful misstatement, or suppression of facts. However, the SCN did not specify which ground applied or provide details of the alleged misconduct.
The department issued a cancellation order, cancelling the registration with retrospective effect. The revenue also issued a recovery notice that froze the petitioner’s bank account and raised a tax demand. The petitioner approached the High Court.
The bench comprising Justice Sanjeev Sachdeva and Justice Vinay Saraf observed that the SCN merely reproduced Section 29(2)(e) without specifying whether the cancellation was based on fraud, willful misstatement, or suppression of facts.
The bench observed that the SCN lacked details and essential information, such as the issuing authority’s details or hearing schedule. The court held that a valid SCN must provide clear grounds to enable a response.
The bench observed the contention of the respondents that the petitioner attempted to change his registered address but failed to submit a property tax receipt, and an inspection found him unavailable at the original address.
However, the court observed that the above plea was not sustainable as both SCN and order of cancellation contained the details and were completely silent. The court set aside the SCN, cancellation orders, and recovery notice.
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The court directed that the respondents could initiate fresh action in accordance with the law, provided a proper SCN with full details and an opportunity for a personal hearing is issued. The petitioner was directed to comply with GST regulations.
The writ petition was allowed and disposed of with no costs, and the connected miscellaneous petitions were closed.
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