Stale show cause notice cannot support GST registration cancellation when prolonged inaction makes the notice redundant and unfair.

GST registration cancellation based on a show cause notice issued about 18 months earlier was held invalid where no intervening action was taken and two financial years had elapsed. The earlier notice had become redundant because later filing obligations and developments had intervened, so cancellation was not in conformity with the proviso to Section 29(2) of the CGST Act. The cancellation was also found to be unfair and unjust, and the cancellation order dated 05.02.2026 was quashed and set aside.

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Issues: Whether cancellation of GST registration based on a show cause notice issued about 18 months earlier, without intervening action, was valid under the proviso to Section 29(2) of the Central Goods and Services Tax Act, 2017.

Analysis: The registration was cancelled on 05.02.2026 on the basis of a notice issued on 13.08.2024, but no action was taken on that notice for a long period. In the meantime, two financial years had elapsed and other intervening developments requiring return-filing had occurred. On these facts, the earlier notice had become redundant and the cancellation was not in conformity with the proviso to Section 29(2). The cancellation was also found to be unfair and unjust.

Conclusion: The cancellation order dated 05.02.2026 was quashed and set aside.

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