GST registration cancellation notice invalid where suspension and cancellation procedures were combined, despite an alternative appellate remedy.

A combined GST show-cause notice invoking suspension and cancellation procedures was treated as invalid because each rule operates in a separate field and the prescribed statutory manner must be followed strictly. The Calcutta HC also noted that an alternative appellate remedy did not bar writ jurisdiction where the challenge was to the foundational notice itself and the initiation was said to be contrary to mandatory procedure. On the facts, the cancellation of registration was interfered with, with restoration directed and compliance required through filing pending returns and continuing regular statutory compliance.

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Issues: (i) whether the show-cause notice dated 29 November 2021 was bad in law for combining distinct statutory procedures; (ii) whether the writ petition was barred by alternative remedy against the cancellation order; (iii) whether the cancellation of registration should be set aside and registration restored in the circumstances of the case.

Issue (i): whether the show-cause notice dated 29 November 2021 was bad in law for combining distinct statutory procedures.

Analysis: The notice was issued in a combined form invoking different procedures under the West Bengal GST regime. A notice for suspension under Rule 21A(2A) and a notice for cancellation under Rule 22(1) operate in different fields and are meant for different situations. Where the statute and rules prescribe a particular manner for doing an act, that manner must be followed. A combined notice in the two formats was treated as a mechanical exercise not conforming to the mandatory procedure.

Conclusion: The notice was held to be bad in law.

Issue (ii): whether the writ petition was barred by alternative remedy against the cancellation order.

Analysis: Although the cancellation order was appealable, the challenge here was directed to the validity of the foundational notice itself. When the very initiation of proceedings is said to be without jurisdiction or contrary to mandatory procedure, the existence of a statutory appeal does not necessarily bar writ jurisdiction. On that basis, the availability of appeal was held not to defeat maintainability.

Conclusion: The writ petition was held to be maintainable notwithstanding alternative remedy.

Issue (iii): whether the cancellation of registration should be set aside and registration restored in the circumstances of the case.

Analysis: The default in filing returns occurred during the pandemic period, and the cancellation would have deprived the petitioner of carrying on business while yielding no corresponding advantage if compliance could be secured by restoration. In view of the invalid notice, the limited ground for cancellation, and the equitable circumstances, interference was considered justified. The Court also directed compliance by filing pending returns and continuing regular compliance thereafter.

Conclusion: The cancellation order was set aside and registration was restored, in favour of the petitioner.

Final Conclusion: The impugned cancellation was quashed, the registration was restored, and the petitioner was directed to regularise statutory compliance by filing pending and future returns.

Ratio Decidendi: Where a statute prescribes distinct procedures for suspension and cancellation of GST registration, those procedures must be followed strictly, and a notice combining them is invalid; such invalid initiation can be challenged in writ jurisdiction despite an alternative appellate remedy.

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