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of <h1>GST registration cancellation for vague show cause notice challenged; retrospective cancellation quashed and appeal order set aside</h1> Cancellation of GST registration based on a Show Cause Notice lacking specificity on retrospective effect, quantum and period of unpaid duty raises ... Cancellation of registration of petitioner - time limitation - petitioner has failed to pay any amount of tax, interest or penalty to the account of the Central/State Government beyond the period of three months from the date on which such payment became due - petitioner has not submitted any explanation to the SCN, which led to the order impugned to be passed - HELD THAT:- It appears that the Show Cause Notice came to be issued to the petitioner and it was informed to the petitioner vide said Show Cause Notice that the petitioner has failed to pay the duty which he was otherwise liable under the GST Act, to be deposited with the respondents and as such, the petitioner was called upon as why his GST registration be not cancelled - It is not in dispute that the petitioner was granted registration on 5th June 2019. The Show Cause Notice does not contain a clause (a) whether the cancellation is with retrospective effect; and (b) as to the quantum of duty and the period for which such duty was not deposited by the petitioner and the consequences thereof, particularly, when the delayed payment of duty is permissible as respondents can recover the same with interest. A vague Show Cause Notice is nothing less than a document which is not providing sufficient and complete opportunity of hearing to the parties like the petitioner. In absence of specific cause in the Show Cause Notice, the petitioner is handicapped and is unable to reply to the respondent qua the cause which is formed to be the basis for the purposes of cancellation of registration of the petitioner’s GST with retrospective effect - In such an eventuality, it has to be held that the order impugned, whereby the GST registration of the petitioner was cancelled with retrospective effect can be said to be non-sustainable in law as the same goes to the principles of natural justice. It is deemed appropriate to quash and set aside the impugned order dated 23rd January, 2021, whereby the GST registration of the petitioner was cancelled with retrospective effect - the order dated 26th September, 2025 passed by the Appellate Authority set aside, whereby the appeal was rejected being time barred. The writ petition stands partly allowed. Issues: Whether the order cancelling the petitioner's GST registration with retrospective effect is sustainable where the Show Cause Notice is vague and does not specify the period or quantum of tax sought to be recovered, and whether the impugned appellate order rejecting the appeal as time-barred can be sustained.Analysis: Section 29 of the GST statute empowers cancellation of registration, including retrospective cancellation. On the facts, the Show Cause Notice did not specify the period for which tax was alleged to be unpaid nor state whether cancellation would be retrospective; the petitioner therefore lacked sufficient particulars to mount an effective reply, impairing the opportunity of hearing guaranteed by principles of natural justice. Although the appeal was time-barred, the absence of adequate particulars in the Show Cause Notice rendered the substantive cancellation vulnerable to challenge. The Court exercised supervisory jurisdiction to test whether the statutory power was exercised consistent with the requirements of fair hearing and adequate notice, and considered remedial directions short of outright affirmation of the impugned orders.Conclusion: The order cancelling the petitioner's GST registration with retrospective effect is quashed and set aside and the appellate order rejecting the appeal as time-barred is set aside; the matter is remitted for issuance of a modified Show Cause Notice and fresh adjudication allowing the petitioner an opportunity to reply.Ratio Decidendi: A Show Cause Notice which fails to specify the period or quantum of alleged tax and whether cancellation is to operate retrospectively deprives the affected party of a meaningful opportunity of hearing and will vitiate a retrospective cancellation under Section 29 of the GST law.
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