Pre-decisional hearing required before GST registration cancellation; procedural rules cannot dilute the statutory safeguard.

Cancellation of GST registration under the Uttar Pradesh GST law was held to require a prior show cause notice and an effective opportunity of hearing before any adverse order is passed. The Court treated cancellation as having serious civil consequences and held that Rule 22 could not override the statutory safeguard in the first proviso to Section 29(2). Even assuming no reply was filed to the earlier notice, the authority still had to afford a pre-decisional hearing before cancellation. The cancellation order was therefore set aside, with liberty to the registered person to respond and for the authority to decide afresh in accordance with law.

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Issues: Whether cancellation of GST registration could be sustained without affording the registered person an opportunity of hearing before passing the order.

Analysis: The impugned cancellation order was treated as having serious civil consequences for the business of the registered person. The first proviso to Section 29(2) of the Uttar Pradesh Goods and Services Tax Act, 2017 was held to require a show cause notice and an opportunity of hearing before cancellation of registration. Rule 22 of the Uttar Pradesh Goods and Services Tax Rules, 2017 was held not to override that statutory safeguard. The Court did not finally rule on service of the earlier notice for want of counter affidavit, but found that, even assuming no reply was filed, a hearing had to be afforded before cancellation.

Conclusion: Cancellation of registration without affording an opportunity of hearing could not be sustained, and the cancellation order was set aside with liberty to the petitioner to respond to the notice and for the authority to decide afresh in accordance with law.

Final Conclusion: The decision enforces the mandatory pre-decisional hearing requirement before cancellation of GST registration and restores the matter to the statutory authority for reconsideration after reply.

Ratio Decidendi: Where the statute makes prior hearing mandatory before cancellation of registration, the authority cannot validly cancel registration without first affording the registered person an effective opportunity of hearing, and procedural rules cannot dilute that requirement.

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