GST registration cancellation upheld for unsupported input tax credit claims and lack of proof of actual goods movement.

GST registration cancellation was examined under Section 29 of the GST Act, 2017 and the GST Rules, 2017, where the assessee had claimed input tax credit without producing reliable evidence of actual movement of goods. The absence of freight records, transport documents, or other corroboration for the e-way bills, together with reliance on fabricated documents and fake invoices, supported the authorities' preventive action to stop further misuse of the tax system. The court found no basis for interference under Article 226, and the cancellation of registration was upheld.

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Issues: Whether cancellation of GST registration was justified on the ground of unsupported input tax credit claims and absence of proof of actual movement of goods.

Analysis: Cancellation of registration was examined in the context of Section 29 of the Goods and Services Tax Act, 2017 and the procedure under the GST Rules, 2017. The record showed that the assessee had claimed substantial input tax credit, but failed to produce convincing evidence of physical movement of goods such as freight records, transport documents, or other material to corroborate the e-way bills. The authorities also relied on the presence of fabricated documents and fake invoices, and noted that action had already been initiated under the GST framework against the suppliers and for blocking of input tax credit. On those facts, the cancellation was treated as a preventive measure against further misuse of the tax system, and no ground for interference under Article 226 of the Constitution of India was made out.

Conclusion: The cancellation of GST registration was upheld and the challenge to the order failed.

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