GST registration cancellation fails where vague notice, no fair hearing, and new appellate grounds violate statutory procedure.

GST registration cancellation is unsustainable where the show cause notice does not disclose concrete allegations, a hearing date, or supporting material, and the affected dealer is not given a fair opportunity to respond. The cancellation order must record satisfaction of the statutory grounds and be supported by reasons confined to the notice issued. Where the appellate authority upholds cancellation on new grounds, such as HSN/SAC description or the alleged indivisibility of registrations, without confronting the taxpayer with that basis, the action breaches statutory procedure and basic fairness. In such circumstances, the cancellation and the orders refusing revocation or appeal are liable to be quashed and registration restored.

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Issues: Whether cancellation of GST registration and rejection of revocation appeal were sustainable when the show cause notice was vague, no effective opportunity of hearing was granted, and the appellate authority relied on new grounds not put to notice.

Analysis: The cancellation proceedings were initiated on the basis of a notice that did not specify a hearing date or disclose concrete allegations and supporting material showing how the statutory grounds for cancellation were attracted. The impugned cancellation order did not record satisfaction of the requirements under the cancellation provision, and the appellate authority sustained the action on a different basis, namely the HSN/SAC description and the alleged indivisibility of the two registrations, without confronting the petitioner with that reasoning or the material relied upon. In matters affecting the right to carry on business, the authority was required to act strictly in accordance with the statute, follow the prescribed procedure, and pass a reasoned order after giving a fair opportunity of hearing.

Conclusion: The cancellation and the orders rejecting revocation and appeal were unsustainable and were quashed; restoration of the registration was directed.

Final Conclusion: The writ petition succeeded because the registration was cancelled and kept cancelled in breach of the statutory procedure and basic fairness requirements, warranting restoration of the registration.

Ratio Decidendi: A GST registration cancellation order cannot be sustained unless the statutory grounds are properly disclosed and proved, the affected person is given a fair opportunity to respond to the material relied upon, and the final order is reasoned and confined to the notice issued.

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