2022 (4) TMI 1242 - HC - GST

Impleadment in personal capacity - GST officer issuing vague show cause notice and/or order - cancellation of GST registration of petitioner - Non-compliance of earlier order 2022 (4) TMI 1144 - GUJARAT HIGH COURT - HELD THAT - In accordance with the order passed by this Court as above, it was expected of the respondent no.2 to issue a fresh show-cause notice containing all the necessary information and material particulars to enable the writ-applicant to meet with the same. However, the respondent no.2 proceeded to pass an order cancelling the registration. The order cancelling the registration on the face of it is as vague as anything. Mr. Nanavati, the learned counsel appearing for the writ-applicant very emphatically submitted that this a fit case, in which the respondent no.2 should be proceeded for contempt of court. He pressed very hard for issue of notice to the respondent no.2 for contempt. Mr. Nanavati is fully justified in making such a submission. However, no notice issued for contempt today with a warning to the respondent no.2 that henceforth if this court comes across any such vague order or show-cause notice duly signed by him, then that will be his last day in the office. There is nothing which can be said anything further in this matter. The order dated 29.03.2022 cancelling the registration of the writ-applicant is hereby quashed and set aside. The so-called order dated 05.04.2022, Annexure-P/4, Page-18 is also hereby quashed and set aside - application disposed off.

Summary

Issues:
1. Cancellation of Goods and Service Tax Registration.
2. Willful disobedience of a court order.
3. Validity of show-cause notice.
4. Contempt of court proceedings.

Cancellation of Goods and Service Tax Registration:
The petitioner filed a writ-application seeking the quashing of an order dated 29.03.2022 by the State Tax Officer canceling the petitioner's GST registration. The High Court noted that the show-cause notice leading to the cancellation was vague and lacked material particulars, making it difficult for the petitioner to respond effectively. The Court quashed the impugned show-cause notice and directed the authority to issue a fresh notice with necessary details. Despite this, the respondent proceeded to cancel the registration without issuing a fresh notice with adequate information. The Court criticized the vague nature of the cancellation order and revoked it, restoring the petitioner's GST registration immediately.

Willful Disobedience of a Court Order:
The petitioner alleged willful disobedience of a court order dated 24.03.2022 by the respondent no.2, the State Tax Officer. The earlier court order disposed of a Special Civil Application challenging a show-cause notice related to the GST registration cancellation. The High Court found that the subsequent actions of the respondent, including issuing vague orders and failing to provide necessary details, amounted to willful disobedience of the court's directions. The Court emphasized the importance of complying with court orders and set aside the orders issued by the respondent, restoring the petitioner's registration.

Validity of Show-Cause Notice:
The Court highlighted the inadequacy of the show-cause notice issued by the State Tax Officer, which lacked essential details and material particulars. Due to the vague nature of the notice, the petitioner faced challenges in responding effectively. The Court quashed the initial show-cause notice and directed the authority to issue a fresh notice containing all necessary information for a proper response. The Court stressed the importance of providing clear and specific details in such notices to ensure fairness and compliance with legal procedures.

Contempt of Court Proceedings:
The petitioner's counsel pressed for contempt of court proceedings against the respondent no.2 due to the repeated issuance of vague orders and non-compliance with court directives. While the Court acknowledged the validity of the submission, it refrained from initiating immediate contempt proceedings. Instead, the Court issued a warning to the respondent, cautioning against future vague orders or show-cause notices. The Court emphasized the seriousness of the matter and indicated that any further non-compliance could lead to severe consequences. Ultimately, the Court quashed the cancellation order and restored the petitioner's GST registration, concluding the writ-application.

This detailed analysis of the judgment from the Gujarat High Court addresses the issues raised in the case comprehensively, focusing on the cancellation of GST registration, willful disobedience of court orders, the validity of show-cause notices, and the potential for contempt of court proceedings.