Order date – 6 April 2023

Parties – Sh. Atul Bansal Vs The Commissioner of Central Tax/Gst Delhi & Anr.

Facts –

• The petitioner, SH. ATUL BANSAL, filed a writ petition to challenge the order of the respondent cancelling its GST registration, which was dismissed for being beyond the period of limitation.
• The petitioner was issued a Show Cause Notice calling upon it to show cause why its GST registration should not be cancelled for non-compliance with specified provisions of the GST Act or Rules made thereunder.

Issue –

• Is the cancellation of petitioner's GST registration and the rejection of their appeal legal when the show cause notice and the order did not provide clear reasons for cancellation?

Order –

• The Court observed that the order does not indicate any reason for cancellation of the petitioner’s registration. It merely states that “the tax payer neither attended personal hearing nor responded to the query raised”.
• The purpose of a show cause notice is to enable the noticee to respond to the allegations on the basis of which adverse action is proposed. In the present case, the Show Cause Notice failed to provide any clue as to why the petitioner’s registration was proposed to be cancelled.
• Hence the Court set aside the Show Cause Notice, the order cancelling the petitioner's registration, and the order rejecting the petitioner's appeal against the cancellation.
• The Court clarified that the respondents are not precluded from issuing a fresh show cause notice clearly specifying the reasons for proposing cancellation of the petitioner's GST Registration and to proceed in accordance with law.
• Hence the Petition disposed of in above terms.