2023 (7) TMI 95 - HC - GST

Application for revocation of GST cancellation rejected - validity of SCN - HELD THAT - Undeniably, the proceedings for cancellation of the petitioner s GST and registration were commenced pursuant to a Show Cause Notice dated 22.08.2022, which was cryptic and did not provide the necessary particulars for proposing cancellation of the petitioner s GST registration. It is trite law that a Show Cause Notice must set out the reasons for proposing an adverse action in order for the noticee to respond to the same. Undisputedly, in this case, the impugned Show Cause Notice did not satisfy the said standards. Thus, it would be apposite to restore the petitioner s application for revocation of cancellation of its GST registration before the concerned officer for deciding afresh. The petitioner is granted further opportunity to respond to the Show Cause Notice dated 11.11.2022 and furnish the necessary documents in support of its claim within a period of two weeks from today - petition disposed off.

Summary

Issues involved:
The judgment involves the cancellation of GST registration based on a Show Cause Notice, rejection of application for revocation of cancellation, and subsequent appeal against the rejection.

Cancellation of GST Registration:
The petitioner challenged a Show Cause Notice dated 22.08.2022, which proposed cancellation of GST registration obtained through fraud, wilful misstatement, or suppression of facts. The petitioner responded by denying the allegations and explaining plans to voluntarily cancel registration due to business winding up. However, the response was not accepted, and registration was cancelled on the basis of the petitioner's Chartered Accountant's submission about a change in the registered place of work. The petitioner contended that it had not shifted from the registered premises and requested an opportunity to provide evidence.

Application for Revocation of Cancellation:
The petitioner filed an application for revocation of the cancellation, stating that the business was ongoing. Despite a Show Cause Notice to furnish documents, the petitioner did not respond, leading to the rejection of the revocation application. The appeal against this rejection was also dismissed on grounds of the petitioner's alleged shift to Sonipat, Haryana, without submitting documentary evidence to support continued operation from the registered premises.

Judgment and Directions:
The High Court observed that the initial Show Cause Notice lacked necessary particulars for proposing cancellation, failing to meet the standards required for such notices. Consequently, the Court directed the restoration of the petitioner's application for revocation before the concerned officer for a fresh decision. The petitioner was granted two weeks to respond to the Show Cause Notice dated 11.11.2022 and provide supporting documents. The concerned officer was instructed to allow the petitioner a hearing and decide on the application afresh. The judgment clarified that all the petitioner's contentions were reserved, and the petition was disposed of accordingly.