GST Registration Cancellation Overturned: Petitioner Granted Fair Hearing with Opportunity to Submit Supporting Documents and Clarify Circumstances

HC allowed petitioner's challenge to GST registration cancellation. The court set aside the rejection order and directed the petitioner to appear before the tax authority, providing an opportunity to submit relevant documents and explain the circumstances surrounding non-filing of returns. The case was disposed of with instructions for a fresh review of the GST registration cancellation application.

---

---

Issues:
1. Petitioner seeking cancellation of GST Registration
2. Rejection of petitioner's request for cancellation
3. Allegations of failure to file returns
4. Suspension of GSTIN and issuance of Show Cause Notice

Analysis:

1. The petitioner, a sole proprietor of an accounting concern, sought the cancellation of its GST Registration with effect from 31.03.2023, as its turnover was below the minimum taxable threshold. The petitioner filed an application for cancellation on 20.04.2023.

2. Despite the application for cancellation, the respondent authority issued a notice on 26.05.2023 alleging the petitioner's failure to file returns. The petitioner claimed that it did not check the portal as it had applied for cancellation, and thus, missed the notice.

3. Subsequently, on 28.12.2023, the respondent sought additional information regarding the cancellation application, which was issued after a significant delay. The petitioner claimed not to have noticed this notice as well.

4. The petitioner's application for cancellation was ultimately rejected on 22.04.2024, leading to the issuance of a Show Cause Notice on 13.05.2024, calling for an explanation for the failure to furnish returns under the CGST Act.

5. The High Court set aside the order rejecting the cancellation application and directed the petitioner to appear before the concerned officer. The petitioner was instructed to file all relevant documents and afforded an opportunity to be heard regarding the cancellation of the GSTIN afresh.

6. The Court emphasized that the action for cancellation was based on the petitioner's failure to file returns post the application for cancellation. The petitioner was required to comply with the directions given by the respondent authority and appear for further proceedings as per the Court's orders.

7. Ultimately, the petition was disposed of with the aforementioned directions, ensuring a fair opportunity for the petitioner to present its case regarding the cancellation of the GST Registration.

---