2023 (3) TMI 790 - HC - GST

Cancellation of GST registration of petitioner - case of the petitioner is that he has not been able to get the show cause notice issued by the respondent and, therefore, he could not submit the reply within the stipulated time - violation of principles of natural justice - HELD THAT - The present petitioner is also entitled for the benefit of the order passed by this Court in (Technosum India Pvt. Ltd. Lucknow Vs. Union of India and others) 2022 (9) TMI 1412 - ALLAHABAD HIGH COURT . In the said judgment, the Court has held that the impugned order does not assign any reason whatsoever for cancelling registration of the petitioner and is passed only on the ground that reply to the show cause notice is not given. The non-submission of reply to the show cause cannot be a ground for cancellation of the registration. In view thereof, the present petitioner is also entitled for the same relief. The benefit of the order in Technosum India Pvt. Ltd. Lucknow shall also be made available to the present petitioner. The present petition is allowed.

Summary

Issues:
Challenge to cancellation of GST registration based on non-submission of GST return leading to cancellation order and subsequent dismissal of appeal on grounds of delay.

Analysis:
The petitioner, a sole proprietary engaged in civil construction work, challenged the cancellation of GST registration due to non-filing of GST return. A show cause notice was issued, but the petitioner claimed non-receipt, leading to cancellation. The petitioner's appeal against cancellation was dismissed for delay. The petitioner argued the cancellation order was contradictory as it mentioned both submission and non-submission of the reply to the show cause notice.

The petitioner contended that not being heard before the cancellation order violated principles of natural justice. Citing a previous judgment, the petitioner argued that cancellation solely for non-submission of reply was unjustified. Referring to the judgment in Technosum India Pvt. Ltd. Lucknow case, it was highlighted that cancellation without reason or application of mind violates constitutional principles.

The court agreed with the petitioner's arguments, granting relief based on the precedent set by the Technosum India Pvt. Ltd. Lucknow case. The court set aside the cancellation order and the appellate order, allowing the petitioner to submit a reply to the show cause notice within three weeks. The respondents were directed to pass a fresh order in compliance with the law upon receipt of the reply and court orders.

In conclusion, the court's decision was in favor of the petitioner, emphasizing the importance of providing reasons and following due process before canceling GST registration solely based on non-submission of a reply to a show cause notice.