Natural justice bars cancellation of sales tax registration without notice where certificate is valid until cancelled and no renewal period is stated.

A sales tax registration certificate stating that it was valid until cancelled, without specifying any expiry date or renewal period, could not be cancelled without prior show-cause notice and an opportunity of hearing. The Court applied the principles of natural justice, noting that the form of the certificate was misleading and that reasonable notice was required before cancellation. Finding the facts covered by an earlier Division Bench ruling on an identical certificate format, the cancellation was set aside as unsustainable, while leaving the authority free to commence fresh proceedings after issuing proper notice.

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Issues: Whether the cancellation of the sales tax registration certificate, issued as valid from a stated date until cancelled, without prior show-cause notice or opportunity of hearing, was sustainable.

Analysis: The certificate did not specify any date of expiry or the time within which renewal had to be sought, and it stated that it was valid until cancelled. The cancellation was effected without proper notice and without affording an opportunity to the dealer. In these circumstances, the absence of an indicated renewal period and the misleading form of the certificate attracted the requirement of reasonable notice before cancellation. The facts were found to be covered by the earlier Division Bench decision dealing with an identical form of certificate and the same issue of abrupt cancellation.

Conclusion: The cancellation was unsustainable and was set aside for breach of the principles of natural justice. The respondent was left free to initiate fresh proceedings after issuing a proper show-cause notice.

Ratio Decidendi: Where a registration certificate states that it is valid until cancelled but does not disclose the expiry date or the time for renewal, cancellation without prior notice and opportunity of hearing is invalid.

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