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TMI Blog2025 (1) TMI 48X X X X Extracts X X X X X X X X Extracts X X X X ..... ffect from 08 October 2022. 2. As we read the impugned Show Cause Notice SCN which had preceded the final order of cancellation, we find the same had alleged a violation of Section 29 (2)(e) of the CGST Act with it being asserted that the registration under the CGST Act had been obtained by means of fraud, wilful mis-statement or suppression of facts. The other reasons which were assigned in that SCN merely read as others . 3. From the final order which has been passed by the respondents, we note that they appear to rest their decision on a physical verification which was undertaken and on the basis of which they came to conclude that the petitioner was bogus/non-existent . On being queried, we were informed that the respondents had in the course of physical verification found that the petitioner was not carrying on any activity from the declared and principal place of business. 4. While this is sought to be disputed by the petitioner, in our considered opinion, we need not go into the said issues since the writ petitioner is entitled to succeed on a more fundamental ground. We note that the original allegation was that the registration itself had been obtained by fraud, wilful mis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from the date of registration; or (e) registration has been obtained by means of fraud, wilful misstatement or suppression of facts: Provided that the proper officer shall not cancel the registration without giving the person an opportunity of being heard: [Provided further that during pendency of the proceedings relating to cancellation of registration, the proper officer may suspend the registration for such period and in such manner as may be prescribed.] 6. On an overall conspectus of the aforesaid and in the absence of any material having been relied upon which may have even remotely tended to indicate that the registration had been obtained by fraud, wilful mis-statement or suppression of facts, we find ourselves unable to sustain the order impugned. 7. Insofar as retrospective cancellation of registration is concerned, we bear in mind the following principles which had come to be laid down by us while dealing with identical questions in Riddhi Siddhi Enterprises vs. Commissioner of Goods and Services Tax (CGST), South Delhi Anr. [WP(C) 8061/2024 dated 22 September 2024], and which read as under: 5. As is manifest from a reading of Section 29, clauses (a) to (e) of Section 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rigation and other waterworks, General construction services of long-distance underground/ overland/ submarine pipelines, communication and electric power lines (cables); pumping stations and related works; transformer stations and related works, General construction services of local water sewage pipelines, electricity and communication cables related works, Installation, assembly and erection services of other prefabricated structures and constructions and possessed a GST registration. 4. A show cause notice was issued to the petitioner on 07.04.2022 Though the notice does not specify any cogent reason, there is an observation in the notice stating failure to furnish returns for a continuous period of six months. The show cause notice requires the petitioner to appear before the undersigned i.e. authority issuing the notice. Notice does not give the name of the officer or place or time where the petitioner has to appear. 5. Further the order dated 13.07.2022 passed on the show cause notice does not give any reasons for cancellation of the registration. It, however, states that the registration is liable to be cancelled for the following reason whereas no reply to notice to show c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at the respondent s contention in this regard is correct, it would follow that the proper officer is also required to consider this aspect while passing any order for cancellation of GST registration with retrospective effect. Thus, a taxpayer s registration can be cancelled with retrospective effect only where such consequences are intended and are warranted. 11. The show cause notice does not even state that the registration is liable to be cancelled from a retrospective date. 12. The petition is allowed. The impugned show cause notice dated 07.04.2022, order of cancellation dated 13.07.2022 and the order in appeal dated 29.12.2023 are accordingly set aside. GST registration of the petitioner is restored, subject to petitioner filing requisite returns upto date. 13. It is clarified that since the petitioner could not have filed the return after the GST registration was suspended, there shall be no liability to pay any penalty or fine for delayed filing. However, this would only apply in case petitioner files an affidavit of undertaking that petitioner has not carried out any business or raised invoices or taken any Input Tax Credit after the registration was suspended with effect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 01.07.2017 i.e., a retrospective date. 6. Neither the show cause notice, nor the order spell out the reasons for retrospective cancellation. In fact, in our view, order dated 15.12.2021 does not qualify as an order of cancellation of registration. On one hand, it states that the registration is liable to be cancelled and on the other, in the column at the bottom there are no dues stated to be due against the petitioner and the table shows nil demand . 7. Learned Counsel for the Petitioner submits that the said order reflected that the GST registration of petitioner stands cancelled from 01.07.2017 even though returns thereafter have been filed by the Petitioner. 8. He further submits that the petitioner is no longer interested in continuing the business and the business has been discontinued. 9. In terms of Section 29(2) of the Act, the proper officer may cancel the GST registration of a person from such date including any retrospective date, as he may deem fit if the circumstances set out in the said sub-section are satisfied. Registration cannot be cancelled with retrospective effect mechanically. It can be cancelled only if the proper officer deems it fit to do so. Such satisfac ..... 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