2021 (7) TMI 466 - HC - GST

Court directs timely resolution of GST registration suspension, upholding due process rights

The Court disposed of the writ petition challenging the suspension of the registration certificate under the GST Act, instructing the petitioner to ... Cancellation of petitioner's registration certificate - reasonable opportunity of hearing was not granted before cancellation of license - petitioner did not reply to the notice as and when required - principles of natural justice - HELD THAT:- A perusal of Sub-rule (3) of Rule 22 of Rajasthan Goods and Service Tax Rules, 2017 clearly shows that the authority concerned is required to cancel the registration (if required) within a period of 30 days of the date of the reply to the show cause notice. True it is, that the petitioner did not file reply by 15.02.2021, as was required by the notice dated 04.02.2021, but then the notice dated 04.02.2021, requiring the petitioner-assessee to file reply within 7 days from the date of service of the notice itself was contrary to the statutory provisions. A bare reading of sub-rule (2A) reveals that the Assessing Authority is required to give 30 days’ time to explain the reason why the registration ought not to be cancelled. In the opinion of this Court, the proceedings of cancellation of registration cannot be kept hanging fire on any pretext, including that assessee failed to file reply within the time allowed. Authority issuing the notice is statutorily bound to pass order in terms of sub-rule (3) of Rule 22 of the Rules. Considering that the petitioner has omitted to file reply within time allowed and even within 30 days of receiving the notice dated 04.02.2021, the present writ petition is disposed of with a direction to the petitioner to put forth all the submissions including the submission about automatic revocation of suspension advanced before this Court - Application disposed off. Issues:Challenge to suspension of registration certificate under GST Act, 2017.Analysis:The petitioner challenged the notice-cum-order suspending their registration certificate dated 04.02.2021. The petitioner's counsel argued that despite submitting a detailed reply on 20.03.2021, no final order regarding the registration was passed, affecting the petitioner's right to trade. The counsel highlighted Section 29 of the Rajasthan Goods and Service Tax Act, 2017, emphasizing the need for a reasonable opportunity of hearing before suspending a license. Additionally, the counsel pointed out Rule 22(3) of the Rules, stating that the order of suspension automatically ends after 30 days if a cancellation order is not passed within that period.The respondent's counsel contended that the petitioner failed to file a reply within the stipulated 7 days, submitting it only on 20.03.2021. The Court noted that while the petitioner missed the initial deadline, they did file a reply within three months. The Court observed that the suspension of registration has severe consequences for the business and emphasized the importance of timely action by the authorities. The Court directed the petitioner to present all submissions and appear before the respondent for a hearing by a specified date, with the respondent required to pass a speaking order in accordance with the law. The petitioner's right to pursue legal remedies against any adverse order was preserved.In conclusion, the Court disposed of the writ petition, instructing the petitioner to present their case before the respondent for a hearing. The respondent was directed to pass a lawful order within a specified timeframe. The Court highlighted the significance of timely resolution in matters concerning the suspension of registration certificates under the GST Act, ensuring that the petitioner's right to due process and legal remedies remained intact.