Cancellation Quashed Due to Lack of Opportunity; Fresh SCN & Hearing Ordered

Issue

Whether a GST registration cancellation order and the subsequent dismissal of the appeal (on limitation) are sustainable when the petitioner claims a violation of natural justice, specifically the lack of a proper opportunity to be heard.

Facts

The Action: A Show Cause Notice (SCN) was issued to the petitioner proposing the cancellation of their GST registration.
The Order: The Proper Officer subsequently cancelled the registration via Form GST REG-19.
The Appeal: The petitioner filed a statutory appeal against the cancellation order.
Appellate Dismissal: The Appellate Authority dismissed the appeal solely on the ground of limitation (time-barred), without examining the merits of the petitioner’s defense.
The Challenge: Aggrieved by both the cancellation and the appellate dismissal, the petitioner filed a writ petition in the High Court.

Decision

The High Court allowed the writ petition in favour of the assessee.
Ends of Justice: The Court held that the “ends of justice” warranted granting the petitioner another opportunity to present their case, rather than shutting down the business on technical grounds.
Fresh Proceedings: The Court quashed and set aside both the original cancellation order (REG-19) and the appellate order.
Directions:
1. The Department must issue a fresh Show Cause Notice to the petitioner (via email or registered post to ensure service).
2. The Proper Officer must afford a personal hearing to the petitioner.
3. The matter must be adjudicated afresh in accordance with the law.

Key Takeaways

Restoration of Rights: Even if a statutory appeal is dismissed on limitation, High Courts often exercise writ jurisdiction to restore a taxpayer’s right to a hearing if the original cancellation appears to have been passed without adequate opportunity.
Fresh SCN Mandatory: By ordering a fresh SCN, the Court effectively reset the entire proceedings, acknowledging that the previous process was legally defective or insufficient.
Business Continuity: The judgment reflects a judicial tendency to protect the right to carry on business against harsh procedural cancellations, provided the taxpayer is willing to participate in fresh adjudication.
Service Matters: The specific direction to send the notice by “email or registered post” highlights the importance of effective service in cancellation proceedings.

HIGH COURT OF ALLAHABAD

Vipul Kumar Singh

State of U.P.^*

Jaspreet Singh, J.

WRIT TAX No. 1261 of 2025

NOVEMBER 11, 2025

Ayush Agarwal and Raghav Bansal for the Petitioner.

ORDER

1. Heard Shri Ayush Agarwal, learned counsel for the petitioner and the learned Additional Chief Standing Counsel for the respondents.

2. The writ petition has been filed with the following reliefs:

“(a) Issue a writ, order or direction in the nature of Certiorari thereby quashing the impugned appellate order dated 08.09.2005 (which is annexed as Annexure No.1 to this writ petition) passed by the respondent No.3 under Section 107 of the CGST/UPGST Act, 2017 whereby Appeal No.242/2025 filed by the petitioner has been rejected solely on the ground of limitation.

(b) Issue a writ, order or direction in the nature of Certiorari quashing the GST Cancellation order dated 19.06.2024 (which is annexed as Annexure No.2 to this writ petition) passed by the respondent No.4 whereby the GST Registration of the petitioner was cancelled vide Form GST REG-19.

(c) Issue a writ, order or direction in the nature of Mandamus, commanding the respondents to provide a fresh opportunity of hearing to the petitioner in accordance with the provisions of the CGST/UPGST Act, 2017 and to decide the matter afresh on merits, strictly in compliance with the principles of nature justice.”

3. Upon perusal of the show cause notice dated 14th May 2024, it indicates that the said notice proposes for cancellation of the petitioner’s GST registration under the GST Act. Thereafter, the impugned order dated 19.06.2024 was passed by the respondent No.4, whereby the GST registration of the petitioner was cancelled. Thereafter, the petitioner filed an appeal under Section 107 of the GST Act, which was also dismissed on the ground of delay in submission of the appeal.

4. For the ends of justice, the Court is of the view that the petitioner may be granted another opportunity to present his case before the relevant officer.

5. The department is directed to issue a fresh show cause notice upon the petitioner by email or by registered post. Once the same is done, the petitioner should appear and after granting a personal hearing to the petitioner, the necessary orders should be passed within a period of eight weeks from date.

6. In light of the above, the impugned orders for cancellation of registration and the order passed in the appeal are quashed and set aside.

7. With the above direction, the writ petition is disposed of.