2020 (10) TMI 431 - HC - GST

Cancellation of registration of petitioner - Validity of SCN - case of petitioner is that without fixing a date for hearing and without waiting for any reply to be filed by the petitioner, the cancellation order was passed on 30.07.2020 whereby registration of the petitioners with GST department was cancelled - principles of natural justice - HELD THAT - Perusal of the same indicates that to such show cause notice no response can be given by any assessee. The show cause notice is as vague as possible and does not refer to any particular facts much less point out so as to enable the noticee to give his reply. - We are not entering into the merits of the impugned order as we are convinced that the show cause notice itself cannot be sustained for the reasons already recorded above. Therefore, the cancellation of registration resulting from the said show-cause notice also cannot be sustained. The impugned show cause notice dated 20.07.2020 (Annexure-H) and the impugned cancellation order dated 30.07.2020 (Annexure-I) are hereby quashed - Petition allowed.

Summary

Issues:
1. Validity of the show cause notice for cancellation of registration.
2. Legality of the cancellation order passed without affording an opportunity of hearing.
3. Explanation provided for the discrepancy in the cancellation order.
4. Decision on the writ petition challenging the cancellation order.

Analysis:
1. The High Court analyzed the show cause notice for cancellation of registration, highlighting its vagueness and lack of specific facts enabling a response. The court noted that the notice did not provide adequate details for the noticee to give a proper reply, rendering it unsustainable.

2. The court addressed the legality of the cancellation order passed without affording the petitioner an opportunity of hearing or waiting for a reply. It was observed that although the cancellation order referred to a reply submitted by the petitioner and a personal hearing, the petitioner had not actually submitted any reply nor been given a chance for a hearing. This fact was not contested by the respondent's counsel.

3. The respondent's counsel explained that a technical glitch in the online portal caused a discrepancy leading to the cancellation order. The court acknowledged the explanation provided and noted that the reply filed by the respondent was on record. However, the court did not delve into the merits of the impugned order due to the unsustainable nature of the show cause notice.

4. Ultimately, the court allowed the writ petition, quashing both the show cause notice and the cancellation order. The court emphasized that the cancellation of registration resulting from the flawed show cause notice could not be sustained. While the respondent requested liberty to proceed afresh, the court declined to grant such an order but observed that if permissible by law, the respondent could proceed afresh in accordance with legal provisions.