2024 (10) TMI 280 - HC - GST

Challenge to cancellation of registration - rejection of appeal for which no reason has been assigned - violation of principles of natural justice - HELD THAT - It is settled law that reason is the heartbeat of every conclusion. An order without valid reasons cannot be sustained. To give reasons is the rule of natural justice. One of the most important aspect for necessitating to record reason is that it substitutes subjectivity with objectivity. It is well settled that not only the judicial order, but also the administrative order must be supported by reasons recording in it. Hon'ble Supreme Court, in the cases of ASSISTANT COMMISSIONER, COMMERCIAL TAX DEPARTMENT, WORKS CONTRACT LEASING, KOTA VERSUS M/S SHUKLA BROTHERS 2010 (4) TMI 139 - SUPREME COURT , TRAVANCORE RAYONS LTD. VERSUS UNION OF INDIA 1969 (10) TMI 23 - SUPREME COURT have observed that the administrative authority and the tribunal are obliged to give reasons, absence whereof would render the order liable to judicial chastisement. Once the reason has not been assigned by the competent authority while passing the impugned orders, the impugned orders cannot be sustained. In absence of any reason in the impugned order, the matter requires reconsideration by the appellate court. The impugned orders cannot be sustained in the eyes of law and same are hereby quashed - the matter is remanded to the appellate authority, who shall proceed de novo and pass an appropriate, reasoned and speaking order, after giving due opportunity of hearing to the petitioner, within a period of three months from today - petition allowed by way of remand.

Summary

Issues:
Challenge to order of cancellation of registration and rejection of appeal without assigning reasons.

Analysis:
The petitioner filed a petition seeking to quash the order of cancellation of registration and the subsequent rejection of the appeal without reasons. The petitioner claimed ignorance of the cancellation and argued that the Proper Officer proceeded ex-parte without providing grounds for cancellation or details of dues. The rejection of the appeal was based on it being filed beyond the limitation period. The Standing Counsel defended the impugned orders, stating that reasons for rejection are available on the official website.

The Court noted that the appeal was rejected without assigning any reasons, which is a crucial aspect of natural justice. Citing legal precedents, the Court emphasized the importance of providing reasons in administrative and judicial orders to ensure objectivity and transparency. The absence of reasons in the impugned orders rendered them unsustainable in law.

As per the established legal principles and considering the lack of reasons in the impugned orders, the Court held that the orders cannot be upheld. Consequently, the writ petition was allowed, and the matter was remanded to the appellate authority for a fresh consideration. The appellate authority was directed to pass a reasoned order within three months after affording the petitioner a fair hearing.

In conclusion, the Court set aside the impugned orders due to the absence of reasons and ordered a fresh adjudication by the appellate authority, emphasizing the importance of providing reasoned decisions in administrative and judicial proceedings to uphold principles of natural justice.