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2024 (6) TMI 1306 - HC - GSTIssues Involved: 1. Validity of the show cause notice dated 8th April 2022. 2. Legality of the impugned order dated 22nd April 2022 canceling the petitioners' GST registration. 3. Alleged violation of principles of natural justice. Detailed Analysis: Issue 1: Validity of the Show Cause Notice Dated 8th April 2022 The petitioners challenged the show cause notice dated 8th April 2022, arguing it was vague and lacked supporting material. They were asked to appear on the same day the notice was issued, which they claimed did not provide sufficient time to prepare a defense. The court noted that the show cause notice did not include any material evidence, which is a violation of the principles of natural justice. The court referenced its previous judgment in Aggarwal Dyeing and Printing Works vs. State of Gujarat, emphasizing that show cause notices must reflect jurisdictional facts and provide sufficient details for the recipient to respond adequately. Issue 2: Legality of the Impugned Order Dated 22nd April 2022 The petitioners argued that the impugned order canceling their GST registration was cryptic, arbitrary, and non-speaking. The court observed that the order was indeed non-speaking and cryptic, failing to provide reasons or evidence supporting the decision. The court reiterated the necessity of reasoned orders, as established in various Supreme Court judgments, which state that reasons are the heart and soul of an order and are essential for judicial transparency and accountability. Issue 3: Alleged Violation of Principles of Natural Justice The court found that the respondents had violated the principles of natural justice by not providing the petitioners with sufficient time to respond to the show cause notice and by failing to supply the necessary supporting documents. The court emphasized that the principles of natural justice require that any order resulting in civil consequences must be preceded by a fair opportunity to be heard. The court cited its previous judgment in Aggarwal Dyeing and Printing Works, which highlighted the importance of adhering to these principles, especially when the order has penal and pecuniary consequences. Conclusion: The court concluded that the facts of the present case were identical to those in Aggarwal Dyeing and Printing Works and that the respondents had failed to adhere to the principles of natural justice. Consequently, the court quashed the show cause notice dated 8th April 2022 and the impugned order dated 22nd April 2022. The court granted liberty to the respondents to issue a fresh notice with detailed reasons and provide the petitioners with a reasonable opportunity to be heard. The petition was allowed solely on the grounds of violation of natural justice, and the court clarified that it had not delved into the merits of the case.
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