TaxTMI 
TaxTMI 
2025 (1) TMI 257
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.... come to be cancelled with retrospective effect from 19 December 2018. 3. For the purposes of evaluating the challenge which stands raised, we deem it apposite to take note of the following essential facts. 4. The petitioner had initially faced an action of cancellation with an order for cancellation being passed on 26 July 2022. The petitioner aggrieved by the aforesaid, applied for revocation on 18 October 2022. That application ultimately came to be allowed by the respondents on 26 December 2023. 5. Surprisingly, and on the very same day, the respondents proceeded to issue another Show Cause Notice SCN, this time calling upon the petitioner to explain why its Goods and Services Tax GST registration be not rejected. 6. That SCN reads as follows: - "Form GST REG-17 [See Rule 22(1)/ sub-rule (2A) of rule 21A] Reference Number: ZA07 l 223 l 70823N Date: 26/12/2023 To Registration Number (GSTIN/Unique ID) : 07BPLPJ8848EIZH DNYAJAIN IX/7600,G/F,R.P.NO.2, AMAR MOHALLA, OLD SEELAMPUR, GANDHI NAGAR, East Delhi, Delhi, 110031 Show Cause Notice for Cancellation of Registration Whereas on the basis of information which has come to my notice, it appears that your registr....
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.... within three months of the date of this order. 4. You are required to furnish all your pending returns. 5. It may be noted that the cancellation of registration shall not affect the liability to pay tax and other dues under this Act or to discharge any obligation under this Act or the rules made thereunder for any period prior to the date of cancellation whether or not such tax and other dues are determined before or after the date of cancellation." 8. As is manifest from the above, the entire procedure as adopted by the respondents appears to be wholly arbitrary. It was on 26 December 2023 that they had ultimately chosen to allow the application made by the petitioner on 18 October 2022 seeking revocation of the original order of cancellation. 9. Inexplicably it is on the same date that yet another notice came to be issued calling upon the petitioner to show cause why its registration be not cancelled. In terms of the notice that came to be issued, the petitioner was accorded a week's time to respond. However, it was called upon to appear the very next day. Thus the petitioner clearly appears to have been deprived of a reasonable opportunity to respond. 10. Quite apart fro....
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....etitioner impugns order in appeal dated 29.12.2023, whereby the appeal filed by the petitioner has been dismissed solely on the ground of limitation. Petitioner had filed the appeal impugning order dated 13.07.2022 whereby the GST registration of the petitioner was cancelled retrospectively with effect from 01.07.2017. Petitioner also impugns Show Cause Notice dated 07.04.2022. 2. Vide impugned Show Cause Notice dated 07.04.2022, petitioner was called upon to show cause as to why the registration be not cancelled for the following reasons:- "Any Taxpayer other than composition taxpayer has not filed returns for a continuous period of six months" 3. Petitioner was in the business of services involving repair, alterations, additions, replacements, renovation, maintenance or remodelling of the building covered above, General construction services of harbours, waterways, dams, water mains and lines, irrigation and other waterworks, General construction services of long-distance underground/ overland/ submarine pipelines, communication and electric power lines (cables); pumping stations and related works; transformer stations and related works, General construction services of loc....
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....eem fit if the circumstances set out in the said sub-section are satisfied. The registration cannot be cancelled with retrospective effect mechanically. It can be cancelled only if the proper officer deems it fit to do so. Such satisfaction cannot be subjective but must be based on some objective criteria. Merely, because a taxpayer has not filed the returns for some period does not mean that the taxpayer's registration is required to be cancelled with retrospective date also covering the period when the returns were filed and the taxpayer was compliant. 10. It is important to note that, according to the respondent, one of the consequences for cancelling a tax payer's registration with retrospective effect is that the taxpayer's customers are denied the input tax credit availed in respect of the supplies made by the tax payer during such period. Although, we do not consider it apposite to examine this aspect but assuming that the respondent's contention in this regard is correct, it would follow that the proper officer is also required to consider this aspect while passing any order for cancellation of GST registration with retrospective effect. Thus, a taxpayer's registration ca....
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....as issued to the Petitioner seeking to cancel its registration. However, the Show Cause Notice also does not put the petitioner to notice that the registration is liable to be cancelled retrospectively. Accordingly, the petitioner had no opportunity to even object to the retrospective cancellation of the registration. 5. Further, the impugned order dated 15.12.2021 passed on the Show Cause Notice dated 04.09.2021 does not give any reasons for cancellation. It, however, states that the registration is liable to be cancelled for the following reason "whereas no reply to the show cause notice has been submitted". However, the said order in itself is contradictory. The order states "reference to your reply dated 15.12.2021 in response to the notice to show cause dated 04.09.2021" and the reason stated for the cancellation is "whereas no reply to notice show cause has been submitted". The order further states that effective date of cancellation of registration is 01.07.2017 i.e., a retrospective date. 6. Neither the show cause notice, nor the order spell out the reasons for retrospective cancellation. In fact, in our view, order dated 15.12.2021 does not qualify as an order of cance....