Karnataka GST Registration Cancellation Quashed Due to Denial of Personal Hearing Under Section 29(2)

The HC quashed the order cancelling the petitioner's registration under Karnataka GST Act because no opportunity for personal hearing was provided as required by Section 29(2). The show cause notice failed to specify a date for personal hearing, violating statutory requirements. The Court set aside the cancellation order and related endorsement, directing the Authority to reconsider the matter afresh from the post-notice stage while keeping the petitioner's contentions regarding the show cause notice open for consideration by the Authority.

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Issues:
1. Opportunity of personal hearing not provided before cancellation of registration under Karnataka Goods and Services Tax Act.

Analysis:
The petitioner sought a writ of certiorari to quash the show cause notice and the order for cancellation of Registration, arguing that he was not personally heard during the proceedings leading to the cancellation. The petitioner contended that the show cause notice did not specify a specific date for availing the opportunity of personal hearing, as required by the Karnataka Goods and Services Tax Act and the Central Goods and Services Act.

The Court observed that the show cause notice did not mention a specific date for personal hearing, and the order for cancellation only stated that the reply and submissions were examined during the hearing. It was noted that the petitioner was not clearly provided with an opportunity for personal hearing as mandated by the proviso to Section 29 (2) of the Karnataka Goods and Services Tax Act.

The proviso to Section 29 (2) of the Karnataka Goods and Services Tax Act explicitly states that cancellation of registration cannot occur without giving the assessee an opportunity to be heard. Therefore, in proceedings related to cancellation of registration, it is essential to provide the assessee with a chance for personal hearing, including specifying the time and date for the same. The absence of such details in the order necessitated setting aside the order for cancellation and remitting the matter for fresh consideration before the Authority.

Consequently, the Court set aside the order for cancellation and directed the matter to be reconsidered by the Authority, starting from the stage after the issuance of the notice. The endorsement related to the cancellation was also set aside. The petitioner's contentions regarding the show cause notice were kept open to be presented to the respondent Authority for consideration.

In conclusion, the writ petition was disposed of in light of the above findings, emphasizing the importance of providing an opportunity for personal hearing before taking any action such as cancellation of registration under the relevant tax laws.

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