2022 (6) TMI 758 - HC - GST

Revocation of cancellation of registration of GST - non-application of mind - application rejected without any detailed reasoning - violation of principles of natural justice - HELD THAT - Petitioner had filed the application for revocation of cancellation in a very detailed manner. However, the application is seen rejected in one sentence. Nothing further needs to be elaborated as to the non-speaking nature of the order under challenge. No reason has been specified in the impugned order. Reasons are soul of every order. However, brief it may be, the order must reflect an application of mind of the authority. Due to the absence of any reasoning reflected in Ext.P11, notwithstanding the merits or demerits of the contentions raised by both sides, Ext.P11 cannot stand the test of scrutiny of law. The 1st respondent is directed to pass fresh orders on Ext.P8 application filed by the petitioner - petition disposed off.

Summary

Issues:
Challenge to rejection of application for revocation of GST registration cancellation.

Analysis:
The petitioner challenged the rejection of her application for revocation of GST registration cancellation. The petitioner's father, who owned a business, passed away, and the petitioner claimed that the business rights were bequeathed to her through a will. The GST registration was transferred to the petitioner, but her brothers later approached the authorities seeking cancellation, alleging that the transfer was done without their knowledge. The GST registration was indeed canceled based on the brothers' claims. The petitioner then filed applications for revocation of the cancellation, which were rejected in a one-sentence order, lacking any reasoning.

The High Court noted that the rejection order lacked reasoning, which is essential for any order to reflect the application of mind by the authority. Despite the merits or demerits of the contentions, the court held that the order cannot withstand legal scrutiny without proper reasoning. Consequently, the court set aside the rejection order and directed the authority to pass fresh orders on the petitioner's application. The court emphasized the importance of reasons in orders and directed the authority to consider the application afresh, ensuring all parties involved are heard before final orders are passed.

The court also addressed the separate application filed by respondents 2 and 3 for transferring the GST registration in their favor, clarifying that it is a distinct matter from the present case. A specific timeline was provided for the authority to consider and pass fresh orders on the petitioner's application for revocation of the registration cancellation. The court instructed all relevant parties to appear before the authority on a specified date to expedite the process and ensure a decision is made promptly. Ultimately, the writ petition was disposed of, granting relief to the petitioner by setting aside the initial rejection order and ordering a fresh consideration of the application for revocation of the GST registration cancellation.