2024 (1) TMI 954 - HC - GST

Cancellation of GST registration of the petitioner - physical verification of premises not done in proper manner - proper opportunity of hearing not provided - violation of principles of natural justice - HELD THAT - The impugned orders as such have adversely effected the business prospects of the petitioner. Counsel for the petitioner has very fairly not pressed challenge raised to the order of refund rejecting his refund (Annexure P-16) since appeal is already pending. Accordingly, liberty is given to pursue his remedy regarding his appeal against the order rejecting the refund. The impugned order set aside - petition allowed

Summary

Issues involved:
The judgment deals with the cancellation of GST registration of the petitioner and subsequent legal proceedings challenging the cancellation orders.

Cancellation of GST Registration:
The petitioner's GST registration, initially granted on 25.08.2018, was canceled on 09.04.2022 due to discrepancies noticed during physical verification. The petitioner's response highlighted that the registration was for a specific project in Punjab, and the discrepancies were due to renovation work at the premises. The cancellation order was criticized for lacking proper reasoning and examination of the renovation details.

Revocation Application and Appeals:
Following the cancellation, the petitioner filed for revocation under Section 30 of the CGST Act, 2017, citing improper consideration of their reply. However, the revocation application was dismissed on the grounds of lack of renovation evidence and failure to appear for a hearing. Subsequent appeals were also unsuccessful, with authorities questioning the petitioner's business activities and financial records.

Legal Observations and Conclusion:
The High Court observed that the authorities took a technical approach, overlooking the specific circumstances of the case. The petitioner's argument that the premises were a residential house and not directly linked to the partnership firm was considered. The Court noted discrepancies in the reasoning provided for the revocation and emphasized the importance of proper verification procedures.

Judgment and Relief:
The Court allowed the writ petition, quashing the orders of cancellation and dismissal of revocation. The registration of the petitioner was reinstated, acknowledging the adverse impact on their business. The petitioner was granted liberty to pursue further remedies regarding the rejected refund order. The judgment aimed to rectify the procedural shortcomings and restore the petitioner's registration status.