TaxTMI 
TaxTMI 
2022 (8) TMI 406
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....the enforcement of the GST, the petitioner was registered under the UPVAT Act and the CST Act also. It is also claimed that the assessments were carried out in respect of the petitioner establishment under the VAT Act and the CST Act for the assessment year 2017-18. The petitioner claims to be carrying out the business from the registered place of business as registered with the GST Authorities and are paying taxes. A show-cause notice dated 08.05.2020 was issued to the petitioner under Rule 22(1) of the GST Rules whereby it was alleged that on the basis of the information which has come to the notice of the Assistant Commissioner it appears that your registration is liable to be cancelled for the following reasons: "1. Taxpayer found Non-functioning/Not Existing at the Principal Place of Business" 4. Subsequent thereto, an order came to passed on 22.05.2020 (Annexure - 12) wherein the following has been recorded: "This has reference to your reply dated 17/05/2020 in response to the notice to show cause dated 08/05/2020 Whereas no reply to notice to show cause has been submitted. The effective date of cancellation of your registration is....
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....ner also filed written submission before the Appellate Authority in which all the documents as deemed fit by the petitioner were presented before the Appellate Authority. The Appellate Authority dismissed the appeal recording that an inspection was carried out on 20.05.2020 in respect of the premises of the petitioner and on the site in question, the committee comprising of three persons did not find any activity pertaining to the firm over the property in question. It also records that the partner of the firm Shri Arun Jindal was called on phone but he could not give any clear reply. It was also recorded that in the said inspection at the given place of interest, no stocks or commercial activity was found and the partners of the firm did not co-operate in the inspection. It also records that in the inspection report another firm in the name of M/s Star Enterprises, 24 Gandhi Nagar, Sitapur with another GST number was found working and on the spot, the owner of the firm Mr. Imran was found and on the said place the said firm M/s Star Enterprises was found to be working. The said report, which was relied upon, also referred to the license from the Forest Department. It was also reco....
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.... nor were ever supplied to the petitioner nor was the petitioner ever confronted to give reply and response to the said inquiry. He further argued that in any event, on the one hand the allegations against the petitioner are that no commercial activities were being carried out at the place of registration on the other hand the CGST as well as the UP GST Authorities have alleged shortage of finished goods and seizure of the goods on account of expired E-Way bill respectively. He draws my attention to Section 29 of the Act, which provides for cancellation of registration and on the grounds on which the same can be done. Section 29 of the Act is being quoted hereinbelow: "Section 29: Cancellation or Suspension of Registration.- (1) The proper officer may, either on his own motion or on an application filed by the registered person or by his legal heirs, in case of death of such person, cancel the registration, in such manner and within such period as may be prescribed, having regard to the circumstances where, - (a) the business has been discontinued, transferred fully for any reason including death of the proprietor, amalgamated with other legal entity, demerged ....
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....edger, equivalent to the credit of input tax in respect of inputs held in stock and inputs contained in semi- finished or finished goods held in stock or capital goods or plant and machinery on the day immediately preceding the date of such cancellation or the output tax payable on such goods, whichever is higher, calculated in such manner as may be prescribed: Provided that in case of capital goods or plant and machinery, the taxable person shall pay an amount equal to the input tax credit taken on the said capital goods or plant and machinery, reduced by such percentage points as may be prescribed or the tax on the transaction value of such capital goods or plant and machinery under section 15, whichever is higher. (6) The amount payable under sub-section (5) shall be calculated in such manner as may be prescribed." 11. Learned counsel for the petitioner argues that none of the grounds as contained in Section 29 of the Act were alleged or established against the petitioner. He has drawn my attention to the judgment of the Hon'ble Supreme Court in the case of Oryx Fisheries Private Limited v. Union of India and Ors. - (2010) 13 SCC 427 wherein the requirem....
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....ods were prepared, which indicated various goods as were seized in terms of the said panchnama, which is recorded as RUD - 1 to the show-cause notice dated 28.05.2021, to this he argues that after the cancellation of the registration, the petitioner might have kept the goods there. 17. In the light of the submissions made at the Bar, this Court is to consider whether the action taken against the petitioner in respect of cancellation satisfies the test of the requirement of Section 29 of the Act or not? 18. A perusal of the show-cause notice at the first instance, clearly depicts the opaqueness of the allegations levelled against the petitioner, which were only to the ground that ''tax payer found non-functioning/non-existing at the principal place of business'. The said show-cause notice did not propose to rely upon any report or any inquiry conducted to form the opinion and on what basis was the allegation levelled that the tax payer was found non-functioning; it does not indicate as to when the inspection was carried. A vague show-cause notice without any allegation or proposed evidence against the petitioner, clearly is violative of principles of administrative....