Cancellation of sales tax registration requires reasoned consideration of objections, even where persistent default justifies action.

Persistent default in filing returns, non-payment of admitted tax, substantial arrears, and non-compliance with a security direction can amount to good and sufficient reasons for cancellation of registration under section 14(7) of the Kerala General Sales Tax Act. The power is intended to secure proper tax collection and may be invoked against a recalcitrant dealer. However, the prescribed authority must consider the dealer's objections and dispose of them by a reasoned order before cancelling registration. Because the objections based on illness, illiteracy, and an alleged instalment arrangement were not duly addressed, the cancellation order was vitiated and the matter was remitted for fresh decision.

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Issues: Whether cancellation of registration under section 14(7) of the Kerala General Sales Tax Act was justified for persistent default in filing returns and payment of tax, and whether the order was vitiated for failure to consider the dealer's objections.

Analysis: The default in filing monthly returns, the failure to remit admitted tax, the existence of substantial arrears, and the dealer's non-compliance with the order to furnish security constituted material circumstances capable of amounting to "good and sufficient reasons" for action under section 14(7). The power under that provision is meant to secure proper collection of tax and may be invoked against a recalcitrant dealer. However, before cancelling a registration certificate, the prescribed authority must apply its mind to the dealer's objections and dispose of them in a reasoned manner. In the present case, the objections based on illness, illiteracy, and the alleged instalment arrangement were not adverted to or dealt with in accordance with law.

Conclusion: The cancellation order could not be sustained because of the fundamental infirmity in not considering the objections, and the matter had to be restored for fresh decision in accordance with law.

Final Conclusion: The revision did not result in final affirmation of the cancellation, and the matter was sent back for fresh disposal after due consideration of the dealer's objections.

Ratio Decidendi: Though persistent tax default may furnish good and sufficient reason to invoke section 14(7), the authority must pass a reasoned order after considering the dealer's objections; failure to do so vitiates the cancellation.

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