Cancellation of GST Registration Overturned Due to Inconsistent Statements Regarding Response to Show Cause Notice
GST: The order for the cancellation of the GST registration, characterized by conflicting statements concerning the receipt of the petitioner’s reply to the show cause notice, has been annulled due to a lack of thorough consideration. The matter has been sent back for a fresh review, allowing the petitioner to submit a reply and have an opportunity for a hearing.
Legal Context: The petitioner contested the cancellation of GST registration, arguing that the cancellation order was issued without proper consideration. The order in question included contradictory statements about the receipt of the petitioner’s response to the show cause notice.
Ruling: The court determined that the registration cancellation order reflected a failure to engage with the facts appropriately. The conflicting statements in the order led to its annulment. The petitioner has been instructed to submit a response to the show cause notice within three weeks, and the adjudicating authority must reassess the situation and issue a new order after providing a hearing opportunity to the petitioner.
Case Reference: Surendra Bahadur Singh v. State of U.P. and Others, Writ Tax No.172 of 2023, decided on August 23, 2023.
Court Proceedings:
- The matter was presented to the court, where the petitioner was represented by Sri Vishwjit, accompanied by the learned Standing Counsel for the State.
- A writ petition was filed under Article 226 of the Constitution, challenging the original cancellation order issued on February 16, 2023, by the Assistant Commissioner, Sector-3, State Tax, Etawah.
- The petitioner’s counsel emphasized that the cancellation order lacked due diligence, evident from the conflicting statements. The relevant excerpt from the order states:
“This refers to your reply dated 16/02/2023 in response to the notice to show cause dated 15/01/2023. Whereas no reply to the notice to show cause has been submitted.”
- The counsel highlighted the inconsistency, as the order first acknowledges a reply was filed but later claims none was submitted. He cited a precedent set by a Division Bench of this Court regarding the necessity of thorough consideration in such decisions.
- The court emphasized that administrative or quasi-judicial bodies must provide reasons for their decisions, as these are crucial for judicial and administrative integrity. The order found no justification for the severe action of cancellation.
- In conclusion, the court quashed the cancellation order dated February 16, 2023, and mandated that the petitioner file a response to the show cause notice within three weeks. The adjudicating authority is directed to hold a fresh hearing and make a new determination.
- The petition was thus granted, with the outlined instructions in place.
