2023 (9) TMI 40 - HC - GST

Validity of SCN - inspection of place of business - Cancellation of GST registration of petitioner - HELD THAT - The Impugned Show Cause Notice dated 03.07.2023 has not even specified the person to whom the reply has to be made by the petitioner. Section 67(1) of the CGST Act, 2017 merely deals with authorization to an officer not below the rank of Joint Commissioner can inspect any place of business of the taxable person or the person engaged in business of transporting goods or the owner or the operator or warehouse or godown or in other place - There is no basis for the alleged suppression of facts by the petitioner while obtaining registration to cancel the registration under Section 29(2)(e) of the CGST Act, 2017. No jurisdictional facts have been disclosed in notice that has been issued to the petitioner. Taking into consideration the facts and circumstances of the case, the Impugned Show Cause Notice is to held as bad in law. It is therefore liable to be quashed - petition allowed.

Summary

Issues Involved:
The Impugned Show Cause Notice lacking particulars and validity under Section 29(2)(e) of the CGST Act, 2017.

Impugned Show Cause Notice lacking particulars:
The petitioner challenged the Impugned Show Cause Notice dated 03.07.2023 for being a system generated notice without specific details, including the recipient of the reply. The Court noted the deficiency in the notice, emphasizing the necessity of providing essential information for effective communication and legal compliance.

Validity under Section 29(2)(e) of the CGST Act, 2017:
The respondents defended the notice, citing an inspection conducted prior to its issuance. However, the Court scrutinized the legal basis for cancellation of registration under Section 29(2)(e) of the CGST Act, 2017, which requires jurisdictional facts and valid grounds. It concluded that the notice failed to establish the alleged fraud or suppression of facts by the petitioner, rendering it legally unsustainable.

Decision and Rationale:
Considering the inadequacy of the Impugned Show Cause Notice, the Court deemed it legally flawed and ordered its quashing. It granted liberty to the respondents to issue a proper notice, adhering to the requirements of the law, for the petitioner to show cause against the cancellation of registration under Section 29(2)(e) of the CGST Act, 2017. The Writ Petition was allowed with observations and liberty, without imposing any costs, and related petitions were closed accordingly.