Procedural Fairness Prevails: GST Registration Cancellation Order Overturned Due to Inadequate Reasoning and Technical Dismissal

The SC reviewed a GST registration cancellation case involving procedural irregularities. The court found the appellate authority's order lacking reasoned analysis and improperly dismissing the appeal on technical grounds. Following constitutional principles of fairness, the SC set aside the cancellation order and directed a fresh administrative review, ensuring the petitioner's opportunity to present documentation and challenge the original registration cancellation.

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Issues:
The issues involved in the judgment are the cancellation of registration under Section 29 of the Central Goods and Services Tax Act and the dismissal of the appeal by the appellate authority on the ground of limitation.

Cancellation of Registration:
The petitioner's registration was cancelled due to failure to furnish returns for a continuous period of six months under Section 39 of the CGST Act. The petitioner, who was unwell and had submitted papers to their counsel, failed to reply to the show cause notice. The appellate authority dismissed the appeal due to the counsel's non-appearance, leading to the cancellation of registration. The order for cancellation specified the amounts payable and the basis for the cancellation. The petitioner argued that the order was non-speaking and lacked application of mind, citing a previous judgment to support their case. The court, following the precedent, allowed the writ petition, setting aside the cancellation order.

Dismissal of Appeal:
The petitioner's appeal against the cancellation order was dismissed by the appellate authority on the ground of limitation, considering the starting point of limitation as the date of the order. The petitioner contended that the doctrine of merger did not apply due to the appeal being beyond limitation. The court, referring to a previous case, held that orders passed without reason and prima facie lack of application of mind do not stand the test of scrutiny under Article 14 of the Constitution of India. Consequently, the court allowed the writ petition, directing the petitioner to appear before the respondent with the necessary documents for a fresh order to be passed in accordance with the law.

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