GST registration cancellation set aside for non-speaking order and breach of natural justice; registration restored.

GST registration cancellation was set aside because the authority passed a cryptic, non-speaking ex parte order without genuinely considering the show cause reply. As cancellation has civil and penal consequences, a reasoned order and proper application of mind were required, and the failure to address the explanation violated natural justice. The record also showed that the taxpayer had filed pending returns, discharged the tax liability, and sought condonation of delay in the context of pandemic disruption. On those facts, the cancellation was unsustainable, the registration was restored, and the delay in filing returns was treated as closed.

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Issues: Whether the order cancelling the petitioner's GST registration was liable to be quashed for being a non-speaking ex parte order passed without proper consideration of the show cause reply and whether the registration was required to be restored on the facts of the case.

Analysis: The cancellation order did not disclose any real consideration of the notice to show cause or the reply submitted by the petitioner and was cryptic in nature. Since cancellation of registration carries civil and penal consequences, the authority was required to pass a reasoned order. The record also showed that the petitioner had subsequently filed the pending returns, paid the tax liability, and sought condonation of delay in the peculiar circumstances, including the disruption caused by the pandemic. In these circumstances, the failure to consider the explanation and the request for condonation amounted to violation of natural justice.

Conclusion: The cancellation order was unsustainable and was quashed. The petitioner's registration was restored, and the delay in filing returns was treated as closed.

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