Order Date – 28 July 2023

Parties: Sohilbhai Siddiqbhai Aadmani Vs Superintended, Central Goods and Service Tax

Facts –

• The Petitioner, Sohilbhai Siddiqbhai Aadmani, is engaged in the business of trading of ferrous, non-ferrous metal, machineries. On 25.07.2022, a search operation was carried out at the business place of the petitioner, no illegality was found by the respondent.
• A show cause notice dated 04.08.2022 under Section 29 of the said Act read with Rule 22(1) of the Rules, came to be issued to the petitioner, inter alia, alleging that the Registration has been obtained by means of fraud, willful misstatement or suppression of facts. The said show cause notice was silent on the aspect of reasons.
• The petitioner also sought for personal hearing. However, on 17.08.2022, the respondent passed an order without providing any material and pursuant to the said order, Registration of the petitioner was cancelled ab-initio w.e.f. 26.04.2018.

Issue – 

• Whether the cancellation of registration is in order?

Order – 

• The Divisional Bench of Hon’ble High Court observed that the show cause notice of cancellation of Registration dated 04.08.2022, is without any reason and it is one line show cause notice, such show cause notice is without any basis and there is no reason assigned in arriving at the conclusion for cancellation of Registration.
• Further, the respondent authority has not taken into consideration the reply dated 17.08.2022 given by the petitioner to the respondent authority. It transpires that on the same day i.e. on 17.08.2022, the order for cancellation of Registration came to be passed. The request for an opportunity of being heard in person was not accorded to the petitioner, though asked for.
• In the present case on hand, it is clear that while issuing show cause notice for cancellation of Registration, necessary documents were not supplied and the notice is cryptic. It is also clear that while passing the impugned order for cancellation of Registration, the respondent authority has not assigned any reason and thus, the order passed by the respondent authority is not tenable at law.
• In the aforesaid facts and circumstances of the case and considering the decisions rendered in the case of Aggrawal Dyeing, Om Trading and Sonal Metals, the show cause notice dated 04.08.2022 as well as the order dated 17.08.2022, deserve to be quashed and set aside.
• The concerned respondent is hereby directed to restore the Registration of the petitioner forthwith. The writ petition is allowed.