2020 (3) TMI 511 - HC - GST

Cancellation of registration of petitioner - registration has been cancelled on the allegation that the Registration has been obtained by means of fraud wilful misstatement or suppression of facts - writ petitioner could not respond to the show cause notice, but later on produced letter, stating reasons for not responding alongwith the counter affidavit - HELD THAT - When the writ petitioner s registration is sought to be cancelled, we are of the view that adequate opportunity of hearing should have been granted to the writ petitioner. For such purpose, we dispose of the writ petition with a direction upon the respondent no. 3, namely, Assistant Commissioner, Commercial Tax, Sector-3, Kanpur, to allow the writ petitioner an opportunity of hearing and decide the issue afresh, after considering the writ petitioner s reply which is already on record. The order of cancellation of registration dated 1st December, 2018, is liable to be set aside - Petition disposed off.

Summary

Issues:
Challenge to impugned order dated 1st December, 2018 canceling registration of the petitioner.

Analysis:
The High Court dealt with a writ petition challenging the cancellation of registration of a trading company by the Assistant Commissioner, Commercial Tax, Sector-3, Kanpur. The impugned order dated 1st December, 2018, canceled the registration of the petitioner effective from 26th November, 2018. The genesis of this order was a show cause notice dated 19th November, 2018, alleging registration obtained through fraud, wilful misstatement, or suppression of facts. The petitioner responded through a letter dated 5th December, 2018, explaining a delay in response due to a pin code mistake causing the letter not to reach the authorities on time. The petitioner also sent a reply via email, which the respondents disputed as sent to the wrong address. The Court emphasized the importance of granting the petitioner a fair opportunity of hearing before canceling the registration. Consequently, the Court directed the Assistant Commissioner to allow the petitioner a hearing and decide the matter afresh, considering the petitioner's response already on record. This process was to be completed within six to eight weeks from the date of communication of the Court's order.

The Court found that the cancellation of registration on 1st December, 2018, lacked procedural fairness due to inadequate opportunity for the petitioner to present their case. Therefore, the Court set aside the order of cancellation and disposed of the writ petition accordingly. The judgment highlights the significance of providing a fair hearing before taking such drastic actions as canceling a company's registration. The decision underscores the principles of natural justice and procedural fairness in administrative actions, ensuring that individuals or entities are given a chance to respond and defend themselves before adverse decisions are made. The judgment serves as a reminder of the importance of due process and the right to be heard in matters affecting one's legal rights and interests.