One line cryptic notice issued for cancellation of GST registration invlaid : High Court

ORDER

Devan M. Desai, J. – The petitioner, by way of this petition has sought direction of this Court for quashing and setting aside the show cause notice dated 26.8.2022 issued by respondent No.2 and further prayed for the staying of the implementation and operation of the aforesaid show cause notice dated 26.8.2022 issued by respondent No.2.

2. Heard learned advocate Mr. Maulik Nanavati for M/s. Nanavati & Co. for the petitioner and learned Assistant Government Pleader Mr. Raj Tanna for the respondents.

3. The petitioner is a registered Enterprise under Gujarat Goods and Service Tax Act, 2017 having goods and service tax Identification No.24BVJPR6842L1ZY. The petitioner has submitted that a show cause notice dated 26.8.2022 came to be issued by the department in Form GST REG-17/31. The said notice states that “in case, registration has been obtained by means of fraud, willful misstatement or suppression of facts.” The said notice has been challenged by the petitioner on the ground that the same is one line cryptic notice and principles of natural justice has not been followed by the respondent authority by not giving of any opportunity of being heard.

3.1. It is further submitted by the learned advocate for the petitioner that the said show cause notice does not contain any reasoning and does not record any details any details and facts relating to the allegations.

3.2. Learned advocate for the petitioner has submitted that in the another show cause notice of the even date was issued wherein a reference of Section 29 of the Central Goods and Service Tax Act, 2017 (CGST) Act, 2017 for cancellation of registration has been given and as per the said show cause notice, the reason for cancelling the registration is “(a) does not conduct any business from the declared place of business and (b) issues invoice or bill without supply of goods or services or both in violation of the provisions of this Act, or the rules made thereunder.”

4. Learned Assistant Government Pleader for the respondents has mainly relied upon the submissions made in the affidavit-in-reply wherein he has submitted that the show cause notice dated 26.8.2022 was issued by the authority on the basis of material available and the said show cause notice was issued giving explanation through email and registered post AD on 2.9.2022. Learned Assistant Government Pleader has further submitted that the petitioner though was given an opportunity, did not make any representation before the authority and they have directly approached this Court and challenged the show cause notice which may not be entertained by this Court.

5. On 26.8.2022, the respondent authority issued another show cause notice for cancellation of registration. The said show cause notice is on record.

6. In view of the above developments and the situation emerging i.e. issuance of second show cause notice of even date, ends of justice would be served if this petition is disposed of by passing the following directions:

6.1. In order to enable the competent authority to undertake the aforesaid exercise and pass fresh order, the impugned notice dated 28.6.2022 is hereby quashed and set aside.

7. It is clarified that this Court while passing this order on the limited issue has neither expressed any opinion on facts nor gone into the merits of the case of the either side.

8. The petition is allowed in the above terms and to the aforesaid extent.