Registration cancellation overturned due to lack of reasoning under Section 29(2)(b) violation of natural justice principles Rajasthan HC allowed petition challenging cancellation of registration for non-filing of quarterly returns. Court held that impugned order violated ...
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Registration cancellation overturned due to lack of reasoning under Section 29(2)(b) violation of natural justice principles
Rajasthan HC allowed petition challenging cancellation of registration for non-filing of quarterly returns. Court held that impugned order violated principles of natural justice by failing to provide reasons for cancellation. Though proper officer has power under Section 29(2)(b) to cancel registration for non-compliance, the order was completely non-speaking and lacked reasoning. HC set aside the cancellation order and remanded matter to concerned authority for fresh consideration with appropriate reasoning in accordance with law.
Issues: Cancellation of registration without providing reasons in the order.
Analysis: The petitioner challenged the cancellation of registration order dated 30.12.2022, arguing that it lacked any reasons for the cancellation, rendering it non-speaking. The respondent contended that a show cause notice was issued on 08.11.2022 due to the petitioner's failure to submit quarterly returns, and as no reply was received, the cancellation order was passed. The court noted that the power of cancellation under Section 29 of the CGST Act necessitates proper reasoning in the order, which was absent in this case.
The court emphasized that the cancellation order significantly impacts a person's right to conduct business and must adhere to the grounds specified in Section 29 of the CGST Act. The order in question, being non-speaking, failed to provide any rationale for the cancellation, contrary to the statutory requirement. The court highlighted the provisions of Section 29(2)(b) which empower the proper officer to cancel registration if certain conditions are met, such as non-filing of returns beyond the prescribed period.
Consequently, the court decided to set aside the cancellation order solely due to its non-speaking nature, without delving into the merits of the case. The matter was remanded to the concerned authority for reconsideration and issuance of a new order in compliance with the law. The petitioner was granted one month to submit a reply if desired, and the petition was disposed of accordingly.
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