Retrospective GST registration cancellation fails without reasons and disclosure, but prospective cancellation may still stand after business closure.

Retrospective GST registration cancellation was unsustainable where the show-cause notice relied only on an undisclosed complaint and the cancellation order gave no independent reasons beyond repeating the notice, depriving the taxpayer of a meaningful opportunity to respond. The Delhi HC found that such deficient notice and reasoning could not justify cancellation from an anterior date. However, because the business had closed and the taxpayer had sought cancellation on that basis, the registration was accepted as cancelled prospectively from the date of the impugned order, leaving statutory dues and lawful departmental action unaffected.

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Issues: Whether the cancellation of GST registration could be sustained with retrospective effect from an anterior date when the show-cause notice and cancellation order did not disclose cogent reasons or the basis of the proposed action.

Analysis: The cancellation notice referred only to a complaint, but the complaint was not furnished to the petitioner, leaving the petitioner without a meaningful opportunity to answer the allegations. The cancellation order also contained no independent reasons and merely referred back to the show-cause notice. In such circumstances, retrospective cancellation was held to be unsustainable. At the same time, the petitioner had sought cancellation of registration because the business had closed, and the Court accepted that the registration could be cancelled prospectively from the date of the impugned order.

Conclusion: The retrospective cancellation was not sustained, and the registration was directed to stand cancelled prospectively from the date of the impugned cancellation order.

Final Conclusion: The petition succeeded to the extent that retrospective cancellation was displaced by prospective cancellation, while the petitioner remained liable for statutory dues and any lawful action by the authorities.

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