2024 (9) TMI 1540 - HC - GST

Cancellation of petitioner s GST registration with retrospective effect - no reply to the show cause notice has been submitted - It is the petitioner s case that he has not received a copy of the GSTI field visit report on the basis of which the impugned SCN and the impugned order are founded - violation of principles of natural justice - HELD THAT - It is material to note that the impugned SCN did not propose cancellation of the petitioner s GST registration with retrospective effect. Thus, the petitioner had no opportunity to respond to any such action. Although, the impugned SCN had mentioned that it required the petitioner to appear before the concerned officer at the appointed date or time, the said impugned SCN did not mention any such date or time. There is merit in the contention of the petitioner that it was not afforded a full opportunity to respond to the impugned SCN and to show cause why its GST registration should not be cancelled with retrospective effect. It is material to note that the impugned order does not indicate any specific reason for cancelling the petitioner s GST registration ab initio. It is considered apposite to grant the petitioner another opportunity to respond to the said action. The impugned order is set aside. The respondents are directed to furnish a copy of the GSTI field visit report to the petitioner. The petitioner is at liberty to file a reply/response to the said impugned SCN, on the assumption that it proposes cancellation of the petitioner s GST registration with retrospective effect, within a period of two weeks thereafter - petition disposed off.

Summary

Issues:
Impugning order cancelling GST registration with retrospective effect based on field visit report.

Analysis:
The petitioner challenged the cancellation of their GST registration with retrospective effect from 01.07.2017, based on a field visit report indicating non-existence at the registered address. The impugned order was passed after a Show Cause Notice (SCN) dated 22.07.2022, which did not propose retrospective cancellation. The petitioner was not given a full opportunity to respond as the SCN did not specify a date for appearance. The High Court found merit in the petitioner's contention that they were not afforded a proper chance to respond and set aside the impugned order. The respondents were directed to provide a copy of the field visit report, and the petitioner was given two weeks to respond assuming retrospective cancellation was proposed. The proper officer was instructed to allow the petitioner a hearing and make a new decision.

This judgment highlights the importance of providing a full opportunity to be heard before taking adverse actions like cancelling GST registration. The court emphasized the need for procedural fairness and the right to respond effectively to allegations. By setting aside the impugned order and granting the petitioner another chance to respond, the court ensured that the principles of natural justice were upheld. The directive to furnish the field visit report and allow a response within a specified timeframe demonstrates the court's commitment to ensuring a fair process in such matters. The judgment serves as a reminder to authorities to follow due process and give individuals adequate opportunities to present their case before making significant decisions affecting their rights.