2023 (4) TMI 702 - HC - GST

Cancellation of GST registration of petitioner - cancellation for the reason of Non-existent Taxpayers under Risky Exporters Category in DGARM Report - HELD THAT - It is well settled that the Authority that is required to take the decision cannot do so on mere directions of another authority without fully satisfying itself as to the reasons for taking the said decision. It is clear from the impugned order dated 26.09.2022 that the concerned officer has passed the said order merely on the direction of another Authority. Further, the impugned order does not provide any clue as to why the petitioner s GST registration was cancelled. The impugned show cause notice as well as the impugned order cannot be sustained and the same are accordingly set aside. Petition allowed.

Summary

Issues involved: Impugning show cause notice for GST registration cancellation and legality of the subsequent order.

Impugned Show Cause Notice:
The petitioner challenged a show cause notice dated 24.11.2021, which proposed the cancellation of her GST registration based on being listed as a risky exporter. The petitioner contended that there is no provision in the CGST Act for cancellation on such grounds.

Impugned Order for Cancellation:
The petitioner's GST registration was cancelled by an order dated 26.09.2022, citing a direction received from DC (Anti Evasion) as the reason. The court noted that the cancellation was based solely on the direction without proper justification, which is impermissible. The order failed to provide any rationale for the cancellation.

Court's Decision:
The High Court set aside both the show cause notice and the cancellation order, stating that they cannot be sustained. The court emphasized that the decision-making authority must independently assess the situation before taking such actions. The petitioner was granted the opportunity for a fresh show cause notice and a new order, ensuring a fair hearing and due process.

Conclusion:
The petition was allowed, and the impugned show cause notice and order were quashed. The court directed the authorities to follow proper procedures and provide a valid basis for any future decisions regarding the petitioner's GST registration.