Non-application of mind in GST registration cancellation led to quashing, subject to compliance with court directions.

An internally inconsistent GST registration cancellation order, which simultaneously referred to a reply and recorded that no reply had been filed, was found to reflect non-application of mind to the record. On that basis, the cancellation could not be sustained and was quashed, while the department was left free to proceed in accordance with law if the petitioner failed to comply with the court-imposed conditions. Relief was made conditional on filing the required declarations and discharging outstanding dues within the stipulated time.

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Issues: Whether the order cancelling the petitioner's GST registration was liable to be quashed for non-application of mind.

Analysis: The cancellation order referred to a purported reply to the show cause notice and, in the next breath, recorded that no reply had been filed. This internal inconsistency showed that the authority had not applied its mind to the material before it. The Court therefore interfered with the cancellation order, while permitting the department to proceed in law if the petitioner failed to comply with the conditions imposed.

Conclusion: The cancellation of GST registration was quashed in favour of the petitioner, subject to compliance with the directions for filing declarations and discharging dues within the stipulated period.

Final Conclusion: The petitioner succeeded in securing quashing of the impugned cancellation order, but the relief was made conditional on compliance with the directions issued by the Court.

Ratio Decidendi: An order that is internally inconsistent on a material aspect and reflects non-application of mind to the record cannot sustain cancellation of GST registration.

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