Pandemic Lockdown Disrupts Tax Procedure: GST Registration Cancellation Invalidated Due to Lack of Proper Hearing Opportunity

HC found the GST registration cancellation invalid due to lack of proper hearing during pandemic lockdown. Court directed revocation of cancellation, requiring petitioner to file pending returns and determine tax liability. The order emphasized procedural fairness and opportunity to be heard, while maintaining regulatory compliance with tax regulations.

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Issues involved: Challenge to cancellation of registration under the WBGST Act, 2017 without opportunity of hearing.

Comprehensive Details:

Issue 1: Cancellation of Registration without Opportunity of Hearing
The petitioner challenged the cancellation of registration under the WBGST Act, 2017, due to failure to file returns for six months. The petitioner contended that the cancellation order was issued without providing an opportunity of hearing, despite the pandemic hindering their response submission. The petitioner argued that the cancellation would hinder their business operations and revenue interests. The respondents did not accuse the petitioner of tax evasion but emphasized the need for filed returns to determine tax liability.

The Court observed that the show cause notice for cancellation was issued during a lockdown period, raising doubts about the petitioner's ability to respond. Despite the cancellation order mentioning a response from the petitioner, the Court found no evidence of the petitioner being given a chance to submit a response. Considering the adverse impact on revenue and business operations, the Court directed the revocation of the cancellation, with a requirement for the petitioner to promptly file returns for the determination of tax liability. The Court highlighted the necessity for filed returns to ascertain the final tax liability.

In conclusion, the writ application challenging the cancellation of registration was disposed of without costs, with instructions for all parties to adhere to the order downloaded from the Court's official website.

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