2022 (11) TMI 428 - HC - GST

Cancellation of registration of petitioner - provisions of Rule 25 of the Central Goods and Services Tax Rules, 2017 were adhered or not - HELD THAT - Rule 25 provides that where a proper officer is satisfied that physical verification of the place of business of a person is required due to failure of Aadhaar authentication, before the grant of registration or due to any other reason after the grant of registration, such physical verification of the place of business, if deemed necessary, is to be carried out in the presence of the said person - As is evident, in the instant case, the concerned officer deemed it necessary to carry out physical verification of the petitioner s place of business before proceeding to pass the impugned order, which resulted in, as noticed above, in the cancellation of the petitioner s registration. Concededly, no notice was issued to the petitioner requiring, as mandated by Rule 25, his presence at the time of verification - the impugned order cancelling the petitioner s GST registration cannot be sustained. The petitioner s GST registration shall stand restored - petition allowed.

Summary

Issues:
1. Cancellation of GST registration without proper adherence to statutory rules and procedures.

Detailed Analysis:

Issue 1: Cancellation of GST registration without proper adherence to statutory rules and procedures
The High Court addressed the issue of the cancellation of the petitioner's GST registration without following proper procedures. The petitioner's registration was canceled based on the grounds that the petitioner was not found at the address registered with the authorities. However, the petitioner had informed the concerned authority about the relocation of its principal place of business in June 2018. The petitioner had also responded to the show cause notice dated 04.12.2018 by mentioning both the old and new addresses. The respondent argued that the application for amendment and the reply were not considered as they were not uploaded on the designated portal. The Court examined Rule 25 of the Central Goods and Services Tax Rules, 2017, which mandates physical verification of the business premises in certain cases. The rule requires that if physical verification is necessary, it should be done in the presence of the concerned person, and a verification report along with other documents must be uploaded within 15 working days. In this case, physical verification was carried out without notifying the petitioner to be present, and the verification report was not uploaded as required by the rule. The Court cited previous judgments to support its decision that the cancellation of GST registration cannot be sustained due to non-compliance with statutory provisions. Consequently, the petitioner's GST registration was ordered to be restored, and the respondents were given eight weeks to upload the returns for the period when the registration was canceled.

This detailed analysis highlights how the High Court examined the cancellation of the petitioner's GST registration in light of the statutory rules and procedures, ultimately ruling in favor of the petitioner due to non-compliance with the necessary requirements.