GST registration cancellation must be reasoned; restoration may follow where the compliance scheme supports revival.

GST registration cancellation without reasons was treated as inconsistent with the statutory scheme, which is aimed at facilitating compliance and tax collection rather than permanently excluding taxpayers. The court relied on earlier relief in similar matters, the relaxation reflected in Notification No. 52/2020-Central Tax dated 24.06.2020, and the consequences under Section 47 of the CGST Act, 2017 to support a restorative approach. It also noted that a construction permanently barring revival of registration would sit uneasily with Articles 14, 19(1)(g) and 21 of the Constitution. The cancellation order was therefore liable to be set aside and registration restored.

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Issues: Whether cancellation of GST registration could be set aside and the registration restored where the cancellation order was unreasoned and the governing GST framework was intended to facilitate, rather than exclude, assessees from the tax regime.

Analysis: The petition challenged cancellation of GST registration without reasons. The decision was informed by earlier rulings granting relief in similar matters and by the object of the GST enactments, which is to bring taxpayers into compliance and secure tax collection. The Court noted that the GST framework, the allied rules and notifications, including the relaxation reflected in Notification No. 52/2020-Central Tax dated 24.06.2020 and the consequences under Section 47 of the Central Goods and Services Tax Act, 2017, showed a legislative and administrative approach of enabling compliance. It further observed that an interpretation permanently debaring revival of registration would be inconsistent with the guarantees under Articles 14, 19(1)(g) and 21 of the Constitution of India.

Conclusion: The cancellation order was liable to be set aside and GST registration was to be restored in favour of the petitioner.

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