Mandatory pre-cancellation hearing for GST registration cancellation cannot be bypassed; defective notice invalidated the orders.

Cancellation of GST registration under the U.P. GST Act was held unsustainable where the show cause notice did not specify the date and time of personal hearing as required by Rule 22(1), and the record did not rebut the taxpayer's claim that no hearing was afforded. The first proviso to Section 29(2) makes a pre-cancellation hearing mandatory, so strict compliance with that safeguard was required. Reliance on Section 29(1) was misplaced on the facts, and the appellate order was also deficient because it merely repeated the cancellation reasons without independently addressing the challenge. The cancellation and appellate orders were liable to be set aside.

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Issues: Whether cancellation of GST registration and the appellate affirmation were vitiated for want of a proper show cause notice and denial of opportunity of hearing under the U.P. GST Act and Rules.

Analysis: The notice for cancellation did not specify the date and time for personal hearing as contemplated by the prescribed format under Rule 22(1) of the U.P. GST Rules, 2017. The record also showed that the petitioner's assertion that no hearing was afforded was not met in the counter affidavit. The first proviso to Section 29(2) of the U.P. GST Act, 2017 makes an opportunity of hearing mandatory before cancellation of registration, and the procedural requirement had to be followed strictly. The reliance on Section 29(1) was misplaced because the facts of the case did not fall within the situations covered by that provision. The appellate order also failed to independently deal with the challenge and merely repeated the cancellation reasons.

Conclusion: The cancellation proceedings were vitiated by breach of the statutory requirement of hearing, and the cancellation and appellate orders were liable to be set aside.

Ratio Decidendi: Where the statute expressly requires a pre-cancellation opportunity of hearing, non-compliance with that mandatory safeguard invalidates the cancellation of registration.

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