GST registration cancellation quashed as authorities issued "cut and paste" order without proper consideration

Delhi HC examined GST registration cancellation where petitioner failed to respond to show-cause notice. Court found the cancellation order was a "cut and paste job" without proper application of mind by authorities. Despite petitioner's failure to file reply or appear before officer, and subsequent time-barred appeal, HC noted petitioner is a professional chartered accountancy firm. Court issued notice to revenue authorities requesting instructions on whether cancellation order could be recalled on appropriate terms and conditions, acknowledging litigation could have been avoided with timely action by petitioner.

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Issues:
1. Appeal against GST Registration cancellation dismissed as time-barred.

Analysis:
The writ petition challenged the dismissal of the appeal against the cancellation of GST Registration, citing it as time-barred. The petitioner argued that the show cause notice and the order lacked jurisdictional facts. The cancellation was based on non-filing of returns as required under Section 39 of the CGST Act, and missing returns for specific months. The petitioner contended that the cancellation was premature as it did not meet the six-month continuous default requirement under Section 29(2)(c) of the Act.

The show-cause notice and the cancellation order were found to be deficient. The notice lacked clarity and failed to provide a proper reason for cancellation. The cancellation order was deemed to be a cut-and-paste job without due application of mind. It was noted that the cancellation was made effective retrospectively, beyond the proposal in the show-cause notice. The petitioner's failure to respond or appear aggravated the situation, leading to the appeal being filed late.

The Court emphasized the importance of keeping taxpayers within the GST regime for revenue purposes. Considering the petitioner's professional nature as a chartered accountancy concern, the Court suggested recalling the cancellation order on suitable terms. The respondents were requested to return with instructions on the possibility of recalling the order. Formal notice was issued to the respondents, and if they decide to contest the petition, a counter-affidavit will be filed before the next hearing date scheduled for December 5, 2022.

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