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TMI Blog2022 (4) TMI 864X X X X Extracts X X X X X X X X Extracts X X X X ..... .3 to revoke cancellation of the registration of the writ applicant bearing no. 24AEXPA3306CIZZ b. Direct Respondent no.2 to consider the Appeal for Revocation the cancellation of Respondent dated 17.07.2021 filed by the writ applicant on merits c. Direct Respondent no.3 to accept and consider the Application for revocation of registration by the writ applicant within a period of 14 days from the date of application. d. Award costs of the writ application and orders thereon; and e. Grant such further and other interim reliefs, as this Hon'ble Court may deem fit and proper in the present nature and circumstances of the case." 4. The summary of facts of the case as pleaded by the writ applicant in the lead matter are as under : 4.1 The writ applicant is a sole proprietary concern and is engaged in the business of manufacturing of dyeing and printing fabrics. The writ applicant was a registered dealer holding GSTIN registration no. 24AEXPA3306C1ZZ, under the provisions of the Gujarat Goods and Service Tax Act, 2017 (for short 'the Act, 2017') with effect from 04.08.2017. The copy of such registration certificate in the Form GST REG-06, dated 16.02.2018 has been placed on rec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dated) Reasons assigned. Order of cancellation of registration (dated). Reasons recorded in order. Returns filed/ tax paid. Appeal filed, if any. SCA no. 1169 of 2020 24ANFPG0506M1ZB Dated 30.03.2021 06.09.2021 Registration obtained by means of fraud, willfull misstatement or suppression of facts. 25.10.2021 Registration obtained by means of fraud, willfull misstatement or suppression of facts. No Appeal. SCA no. 2263 of 2022. 24AAUPY0725C1ZL Dated 15.09.2018 24.05.2019 Not filed returns for continuous period of six months. 29.06.2019 Not filed returns for continuous period of six months. Claims to have file returns manually and also paid tax. Application dated 12.09.20 19 seeking revocation pending. Appeal rejected vide order dated 09.07.2021, on ground of delay of 17 months. SCA no. 3140 of 2022 24AAFFTS101Q1Z1 07.07.2018 19.06.2019 Not filing returns for continues period of six months. 27.06.2019 Sought time to file reply however, order passed without providing reasons. Application dt. 29.06.2019, seeking revocation rejected vide order dated 03.08.20 19. Appeal filed on 19.09.2021 explaining delay on account of death of father and Covid-19 pandemic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cure the problem of issuing show cause notices containing no specific particulars and also the final orders that are being passed cancelling the registration under the GST Act. Mr. Vyas submitted that he has taken up the issue very seriously with the department and within a short period of time, this problem shall be taken care of. Mr. Vyas prays for a week time to put forward a concrete proposal, which should take care of this issue of vague show cause notice and vague final orders of cancellation of registration. 2. We have been given to understand that the portal is not permitting the concerned officer to insert the material particulars or necessary information to make any show cause notice or any final order, a speaking order or a meaningful order. If the problem is in the portal, then our suggestion is that a show cause notice as well as the final order should be passed on a paper like any other order which any authority or a Court of law passes. Such show cause notice or order should be dispatched at the correct address of the dealer concerned. If this exercise is undertaken, then no dealer will come to the Court complaining that the show cause notice as well as the final ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to be registered under Section 22 or Section 24. * Chapter VI pertains to Registration. Section 22 provides for person liable for registration. Section 23 pertains to person who shall not be liable for registration whereas section 24 provides for compulsory registration in certain cases specified therein. Section 25 provides application to be made within period of thirty days and prescribes procedure to be followed for registration. Section 26 provides deemed registration. * The Gujarat Goods and service Rules, 2017 has come into effect from 22nd June, 2017. Chapter III deals with subject "Registration". Rule 8 provides for Application for registration. Rule 10 provides for Issue of registration certificate. Rule 16 provides for Suo Moto registration. * Section 29 confers power upon the Proper Officer for cancellation of Registration. Section 30 provides for revocation of cancellation of registration. Against the aforesaid substantive provisions prescribed under the Act, the corresponding rules framed thereunder are also required to be looked into. Rule 20 provides for filing of application for cancellation of registration by the dealer. Rule 21 provides for Registration to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he procedure for cancellation of registration can be summarized as under: i. A person already registered under any of the existing laws (Central excise, Service tax, VAT etc.), but who now is not liable to be registered under the GST Act has to submit an application electronically by 31st December 2017, in FORM GST REG-29 at the common portal for the cancellation of registration granted to him. The Superintendent of Central Tax Cancellation of Registration in GST 12 GST FLYERS shall, after conducting such enquiry as deemed fit, cancel the said registration. ii. The cancellation of registration under the State Goods and Services Tax Act or the Union Territory Goods and Services Tax Act, as the case may be, shall be deemed to be a cancellation of registration under Central Goods and Services Tax Act. iii. In the event, the Superintendent of Central Tax has reasons to believe that the registration of a person is liable to be cancelled, a notice to such person in FORM GST REG-17, requiring him to show cause, within a period of seven working days from the date of the service of such notice, as to why his registration shall not be cancelled; will be issued. iv. The reply to the s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l Tax), within a period of thirty days from the date of the service of the order of cancellation of registration at the common portal, either directly or through a Facilitation Centre notified by the Commissioner: ii. However, if the registration has been cancelled for failure to furnish returns, application for revocation shall be filed, only after such returns are furnished and any amount due as tax, in terms of such returns, has been paid along with any amount payable towards interest, penalty and late fee in respect of the said returns. iii. On examination of the application if the Proper Officer (Assistant or Deputy Commissioners of Central Tax) is satisfied, for reasons to be recorded in writing, that there are sufficient grounds for revocation of cancellation of registration, then he shall revoke the cancellation of registration by an order in FORM GST REG-22 within a period of thirty days from the date of the receipt of the application and communicate the same to the applicant. iv. However, if on examination of the application for revocation, if the Proper Officer (Assistant or Deputy Commissioners of Central Tax) is not satisfied then he will issue a notice in FORM G ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ers but with the passage of time the distinction between the two got blurred and thinned out and virtually reached a vanishing point in the judgment of the Supreme Court in A.K. Kraipak v. Union of India, (1970) 1 SCR 45. The Hon'ble Supreme Court vide judgments in the cases of Ravi Yashwant Bhoir v. District Collector Raigad, (2012) 4 SCC 407, Sant Lal Gupta v. Modern Cooperative Grouop Housing Society Limited, (2010) 13 SCC 336; Kranti Associates Private Limited v. Masood Ahmed Khan, (2010) 9 SCC 496; Abdul Ghaffar v. State of Bihar, (2008) 3 SCC 258, has expanded the horizon of natural justice and reasons have been treated part of the natural justice. It has gone to the extent in holding that reasons are heart and soul of the order. The absence of reasons renders an order indefensible/unsustainable particularly when it is subject to appeal/revision. It is to be noted that in the case of Kranti Associates v. Masood Ahmed Khan, (2010) 9 SCC 496, the Hon'ble Supreme Court after considering various judgments formulated certain principles which are set out below: "a. In India the judicial trend has always been to record reasons, even in administrative decisions, if such dec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s emanates from the broad doctrine of fairness in decision making, the said requirement is now virtually a component of human rights and was considered part of Strasbourg Jurisprudence. See (1994) 19 EHRR 553 at 562 para 29 and Anya v. University of Oxford, 2001 EWCA Civ 405, wherein the Court referred to Article 6 of European Convention of Human Rights which requires, "adequate and intelligent reasons must be given for judicial decision." o. In all common law jurisdictions judgments play a vital role in setting up precedents for the future. Therefore, for development of law, requirement of giving reasons for the decision is of the essence and is virtually a part of "Due Process". Thus, the position of law that emerges from the decisions mentioned above, is that assignment of reasons is imperative in nature and the speaking order doctrine mandates assigning the reason which is the heart and soul of the decision and said reasons must be the result of independent re-appreciation of evidence adduced and documents produced in the case. 12. At this stage it would be germane to refer to observations made by the Andha Pradesh High Court in the case of MRF Mazdoor Sangh vs. The Commiss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... following reasons : 1. Any Tax payer other than composite taxpayer has not filed returns for a continuous period of six months. You are hereby directed to furnish a reply to the notice within seven working days from the date of service of this notice. You are hereby directed to appear before the undersigned on 27/09/2018 at 12:42. If you fail to furnish a reply within the stipulated date or fail to appear for personal hearing on the appointed date and time, the case will be decided ex parte on the basis of available records and on merits. Place : Gujarat Signature valid digitally signed by OS Goods and Service Tax Network 1. Date: 2018.09.18 13.00.44" 13.1 To say the least, the respondent authority i.e. the Assistant/Deputy Commissioner, State tax Officer ought to have atleast incorporated specific details to the contents of the show cause. Any prudent person would fail to respond to such show cause notice bereft of details thereby making the mechanism of issuing show cause notice a mere formality and an eye wash. 14. We further notice that the respondent authority has failed to extend sufficient opportunity of hearing before passing impugned order, inspite of speci ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e courts and quasi-judicial authorities have been hearing the appellants and applicants before dismissing such appeals or applications as barred by limitations. It can be said that courts have read the requirements of hearing the appellants or the applicants before dismissing their appeals or applications filed beyond time on principle of natural justice, although the concerned statute does not prescribe such requirement specifically." 15.1 The Appellate authority ought to have appreciated that the writ applicants at relevant point of time i.e. in year 2017, applied for registration which request was favourably considered by the authorities under the Act with a specific registration number allotted to the writ applicant. It was a transitional phase, whereby the old CST Act was repealed and the new regime of CGST/ GGST has come into force. With the different forms and procedure envisaged there under, any layman is bound to take time to adhered to the norms. The Record reveals that subsequently the writ applicants have claim to have filed their returns and have even deposited all dues. We further notice that such exercise has been undertaken through the writ applicant's Tax Cons ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the portal which would enable the Department to feed all the necessary information and material particulars in the show cause notice as well as in the final order of cancellation of registration that may be passed, the authority concerned shall issue an appropriate show cause notice containing all the necessary details and information in a physical form and forward the same to the dealer by RPAD. In the same manner, when it comes to passing the final order, the same shall also be passed in a physical form containing all the necessary information and particulars and shall be forwarded to the dealer by RPAD. 18.2 Over a period of time, we have noticed in many matters that the impugned order cancelling the registration of a dealer travels beyond the scope of the show cause notice. Many times, the dealer is taken by surprise when he gets to read in the order that the authority has relied upon some inspection report or spot visit report etc. If the authority wants to rely upon any particular piece of evidence then it owes a duty to first bring it to the notice of the dealer so that if the dealer has anything to say in that regard, he may do so. Even if the authority wants to rely o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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