Mechanical Cancellation of Registration Set Aside: "Reply Not Considerable" is a Vague Ground; Officer Cannot Demand Documents Already Available on GST Portal

Mechanical Cancellation of Registration Set Aside: “Reply Not Considerable” is a Vague Ground; Officer Cannot Demand Documents Already Available on GST Portal

ISSUE

Whether the Proper Officer can cancel a GST registration by passing a cryptic, templated order stating “reply not considerable” without assigning specific reasons or considering the documents submitted.
Whether the tax authorities are justified in repeatedly calling for documents (like GST returns) from the taxpayer when such records are already available to them on the GST Portal.

FACTS

The First SCN: A Show Cause Notice (SCN) was issued proposing the cancellation of the petitioner’s registration.
The Reply: The petitioner filed a detailed reply within the stipulated time, enclosing all relevant documents, including rent agreements and GST returns for the last three months.
The Cancellation: Ignoring the detailed submission, the Adjudicating Authority passed an impugned order cancelling the registration. The only reason given was a mechanical phrase: “reply was not considerable.”
The Revocation Attempt: The petitioner applied for revocation of cancellation. Another SCN was issued, and despite a reply, the revocation application was dismissed.
The Appeal: The Appellate Authority also rejected the appeal.
High Court Challenge: The petitioner argued that the orders were passed without application of mind.

HELD

Non-Application of Mind: The High Court observed that the Adjudicating Authority failed to consider any of the replies or documents submitted. Passing a “mechanical, templated, and computer-generated order” stating merely that the reply is “not considerable” violates principles of natural justice.
Perverse Orders: The Court termed the orders as perverse and indicative of the negligent manner in which the concerned officer conducted themselves.
Portal Availability: The Court ruled that since GST returns and statutory forms are already available on the GST Portal (which the officer has access to), repeatedly calling for the same documents from the taxpayer is not justified.
Verdict: The impugned orders (cancellation, rejection of revocation, and appellate order) were quashed. The GST registration was directed to be restored immediately, and the matter was remanded for fresh adjudication of the SCN. [In Favour of Assessee]

KEY TAKEAWAYS

“Reply Not Considerable” is Invalid: If you receive an order with this specific phrase (which is a common drop-down option in the GST backend system), it is legally unsustainable. An order must explain why the reply was insufficient.
Documents on Portal: You can argue that the officer cannot demand copies of GSTR-1/3B or registration certificates during verification, as they are the custodians of that data on the backend.
Templated Adjudication: Courts are taking a strict view against “cut-and-paste” orders. If your reply is detailed but the order is a one-liner, a Writ Petition is a strong remedy.

HIGH COURT OF DELHI

MS Imagine Marketing Ltd.

Joint Commissioner CGST Appeals II Delhi^*

PRATHIBA M. SINGH and SHAIL JAIN, JJ.

W.P. (C) No. 17699 of 2025
CM APPL. No. 73120 of 2025

NOVEMBER 21, 2025

Ashwini Chandrasekaran, Ms. Priyanka Rathi and Ms. Priyanshi Chakraborty, Advs. for the Petitioner. Ms. Anushree Narain, SSC for the Respondent.

ORDER

Prathiba M. Singh, J.- This hearing has been done through hybrid mode.

CM APPL. 73120/2025(exemption)

2. Allowed, subject to just exceptions. Application accordingly disposed of.

W.P.(C) 17699/2025

3. The present petition has been filed by the Petitioner under Articles 226 and 227 of the Constitution of India, inter alia, challenging the Order for Cancellation of Registration dated 26th November, 2024 (hereinafter, ‘impugned order’) passed by the Superintendent, Range-56.

4. The present petition reveals a sad situation where a reputed company is being made to deal with an unjustified cancellation of its GST registration. The Petitioner company is the parent company of audio and wearable brand ‘boAt’ which is located at H No. 19 Village Hauz Khas, New Delhi-110016 (hereinafter, ‘premises’). The Petitioner has continuously entered into lease deeds with the owners i.e., Shri Bhim Singh and Shri Satpal Singh from 2019 onwards. For some period, the Petitioner company had leased various floors of this premises, however, it is stated that due to downsizing in the year 2024, it had only entered a lease for the second floor of the premises.

5. A Show Cause Notice (hereinafter, ‘SCN’) was issued to the Petitioner on 15^th October, 2024. The said SCN reads as under:

“Show Cause Notice for Cancellation of Registration Whereas on the basis of information which has come to my notice, it appears that your registration is liable to be cancelled for the following reasons:

1. returns furnished by you under section 39 of the Central Goods and Services Tax Act,2017

Others

Non Existent

You are hereby directed to furnish a reply to the notice within thirty days from the date of service of this notice.

If you fail to furnish a reply within the stipulated date or fail to appear for personal hearing on the appointed date and time, the case will be decided ex parte on the basis of available records and on merits.

Please note that your registration stands suspended with effect from “

6. The above SCN did not give any reasons but barely made two statements as under:

In respect of the said SCN, 30 days were given to the Petitioner to file a reply. However, the Petitioner filed a reply within two weeks itself i.e., on 28^thOctober, 2024 and gave all the details including the rent agreements of the Petitioner and the returns for the last three months.

7. Despite all the detailed documents having been furnished within the time stipulated, the impugned order is passed with one remark to the following effect:

” Order for Cancellation of Registration

This has reference to show cause notice issued dated 15/10/2024.

Whereas reply to the show cause notice has been submitted vide AA071 024036440T dated 07/11/2024; and whereas, the undersigned on examination of your reply to show cause notice and based on record available with this office is of the opinion that your registration is liable to be cancelled for following reason(s):

I. Others

Remarks:

At the time of physical verification, found existent at the give principle place of business, your reply is not considerable so your registration has been cancelled.

The effective date of cancellation of your registration is 15/10/2024.

2. Kindly refer to the supportive document(s) attached for cause specific details.

3. It maybe noted that a registered person furnishing return under sub-section (I) of section 39 of the CGST Act, 2017 is required to furnish a final return in FORM GSTR-10 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 can be seen from the above impugned order, there is no reason given as to why the cancellation has been effected with effect from 15^th October, 2024. Moreover, there is no reason given in the impugned order as to why the documents filed by the Petitioner were not considered, except stating that your reply is not considerable.

9. The Petitioner then filed an application seeking revocation of the cancellation of the GST registration in respect of which again a further SCN dated 26th December, 2024 was issued. The said SCN reads as under:

“Show Cause Notice for rejection of application for revocation of cancellation of registration.

This has reference to your application dated 20/12/2024 regarding revocation of cancellation of registration. Your application has been examined and the same is liable to be rejected for the following reasons:

I. Reason for revocation of cancellation – Others (please specify) – The taxpayer didn’t submit relevant documents like Bank KYC, ID-Address proof, copy of rent agreement/ownership proof, System generated reconciliation for GSTR-3B & GSTR-I; GSTR-3B and GSTR-2A, Details of invoices issued and copy of ledger during the period in which GSTN was cancelled; self-declaration for payment of due tax within a month of revocation. Also, please deposit the tax liability in the cash ledger, if already calculated.

You are hereby directed to furnish a reply to the notice within seven working day. from the date of service of this notice.

If you fail to furnish a reply within the stipulated date or fail to appear for personal hearing on the appointed date and time, the case will be decided ex-parte on the basis of available records and on merits.

Kindly refer the supportive document attached for case specific details.

10. In the SCN dated 26th December, 2024, seven days time was given to the Petitioner to file a reply, which was duly filed by the Petitioner on 06^th January, 2025 – albeit with a slight delay. In respect of these documents which were filed along with a detailed reply, there was no consideration and the revocation application was also dismissed on 8th January, 2025.

11. The Petitioner then filed an appeal before the Appellate Authority, which was rejected by the Appellate Authority vide Order-in-Appeal dated 30th April, 2025 on the following grounds:

“5.1. I find that the appellant, at appellate stage, has only submitted copies of lease deed dated 05.05.2024 & copy of electricity bill in the name of Bhim Singh. Except these documents, the appellant has not submitted any other document requisite through show cause notice dated 08.01.2025.

6. In view of the above, I do not find any fault in the impugned order as the appellant failed to submit the documents/information as were asked for vide show cause notice dated 08.01.2025. Most of the said documents/information have also not been submitted by the appellant at the appellate stage as well except copies of lease deed dated 05.05.2024 & copy of electricity bill in the name of Bhim Singh. As such, I hold that the said impugned order passed by the adjudicating authority is legal and maintainable in law and I do not find any reason to interfere with the said impugned order. Accordingly, I pass the following order:

ORDER

7. The appeal filed by M/s Imagine Marketing Limited, Ground Floor,/p H. No. 19 Village Hauz Khaz, South Delhi, Delhi-110016 against Order-In-Original No. ZA07012503638L dated 08.01.2025 is hereby rejected and disposed of in terms of Section 107(12) of CGST Act, 2017.”

12. The submissions made on behalf of the Petitioner is that all the documents which were filed before the Adjudicating Authority were also placed before the Appellate Authority. But the same are not considered.

13. Heard. A perusal of the index of the appeal filed by the Petitioner reveals that copies of the screenshots, the replies, etc. were all filed and therefore, the Appellate Authority’s order dated 30th April, 2025 is also completely erroneous. The Adjudicating Authority’s approach in this matter has been cavalier, to say the least. The Adjudicating Authority has failed to consider any of the replies and the documents which were filed with the same and has passed mechanical, templated and computer generated orders without any application of mind. All the orders are perverse, and show the negligent manner in which Mr. Pradeep Kumar, Superintendent, Range 56 has conducted himself.

14. An Adjudicating Authority has to show basic fairness, especially in the case of companies which are regular tax payers and who have filed the replies in time along with the requisite documents. Moreover, the GST returns etc. and forms thereof are all available on the GST Portal and repeatedly calling for the same from the tax payer is not justified.

15. Under these circumstances, the Appellate Authority’s Order dated 30^th April, 2025, the impugned order dated 26^th November, 2024 and the order dated 08^th January, 2025 cancelling revocation of the GST registration are all set aside. The said orders lack basic reasoning and do not show even fundamental fairness of adjudication.

16. Accordingly, the GST registration of the Petitioner is restored. The SCN dated 15^th October, 2024 shall now be adjudicated afresh. The replies filed by the Petitioner shall be considered by the Adjudicating Authority. A personal hearing shall be granted to the Petitioner and the notice for personal hearing shall be communicated on the following e-mail address and mobile number:

•

Mobile No.: 7838592852

•

E-mail Address: cashwinil9@gmail. com

17. In the facts and circumstances of this case, Rs. 25,000/- cost is imposed on the Department to be paid to the Petitioner. The same would be recoverable from Mr. Pradeep Kumar, Superintendent.

18. The petition is accordingly disposed of. Pending applications, if any, are also disposed of.