Facts of the Case

The petitioner filed Writ Petition No. 34047 of 2022 challenging the order passed by the first respondent cancelling the petitioner’s GST registration dated 05.04.2022.

The principal grievance was that the GST registration had been cancelled without providing the petitioner an opportunity to submit a reply to the show-cause notice dated 22.03.2022. The petitioner consequently sought setting aside of the impugned cancellation order.

The High Court heard learned counsel for the petitioner, Sri Shaik Jeelani Basha, and learned Senior Standing Counsel for respondent Nos. 1 and 2, Sri Suresh Kumar Routhu. Considering the nature of the pleadings, the Court disposed of the writ petition at the admission stage.

The petitioner further asserted that suspension of the GST registration was made effective from the very same date as the show-cause notice, namely 22.03.2022. According to the petitioner, this rendered the show-cause notice a mere formality.

After receiving the show-cause notice, the petitioner stated that he approached the first respondent and paid the entire dues, interest and late fee up to April 2022. Despite such payment, the GST registration was cancelled without considering the petitioner’s request.

Issues Involved

The principal issues arising from the order were:

  1. Whether cancellation of GST registration could be sustained when the petitioner alleged that no effective opportunity had been provided to submit a reply to the show-cause notice dated 22.03.2022.
  2. Whether simultaneous suspension of GST registration with effect from the very date of issuance of the show-cause notice rendered the notice process merely formal, as contended by the petitioner.
  3. Whether payment of the entire dues, interest and late fee up to April 2022 required consideration while examining the petitioner’s request concerning restoration of GST registration.
  4. Whether the petitioner should be permitted to seek restoration of registration by submitting a fresh representation under Section 30 of the GST Act read with Rule 22(4) of the GST Rules.
  5. Whether the competent authority was required to afford a personal hearing before passing a fresh appropriate order on the restoration request.

Petitioner’s Arguments

The petitioner advanced the following submissions:

  • The GST registration was cancelled without providing an opportunity to submit a reply to the show-cause notice dated 22.03.2022.
  • The suspension of registration was made effective from 22.03.2022 itself, i.e., the same date on which the show-cause notice was issued.
  • Because the suspension took effect from the very date of the notice, the petitioner contended that the show-cause notice became a mere formality.
  • Upon receiving the show-cause notice, the petitioner approached the first respondent.
  • The petitioner paid the entire dues, interest and late fee up to April 2022.
  • Despite such payment, the first respondent cancelled the registration without considering the petitioner’s request.
  • The petitioner therefore sought judicial interference against the cancellation and restoration-related relief.

These submissions are expressly reflected in the two-page order and should be understood as the petitioner’s contentions rather than final factual findings recorded after adjudication on merits.

Respondent’s Arguments

The order records the appearance and hearing of Sri Suresh Kumar Routhu, learned Senior Standing Counsel for respondent Nos. 1 and 2.

However, the short order does not separately record any detailed counter-submissions or specific substantive arguments advanced by the respondents. Therefore, no additional respondent arguments should be inferred, reconstructed or attributed beyond the contents expressly appearing in the judicial order.

Court Order / Findings

The High Court did not enter into the merits of the petitioner’s substantive claim.

Having regard to the submissions placed before it, the Court disposed of the writ petition by granting liberty to the petitioner to submit a fresh representation to the first respondent within two weeks in terms of:

  • Section 30 of the GST Act, read with
  • Rule 22(4) of the GST Rules,

seeking restoration of the GST registration.

The Court further directed that, if such representation was submitted:

  • the first respondent must afford a personal hearing to the petitioner;
  • thereafter, an appropriate order must be passed in accordance with the governing law and rules;
  • such order must be passed within two weeks from the date of receipt of the representation; and
  • the order must be communicated to the petitioner.

The writ petition was disposed of with no order as to costs. Pending interlocutory applications, if any, were also directed to stand closed.

The operative direction is clearly reflected on page 2 of the supplied order, where the Court grants liberty for a fresh representation under Section 30 read with Rule 22(4) and expressly requires a personal hearing before the authority passes an appropriate order.

Important Clarification

This order should not be described as a final judgment holding the GST registration cancellation illegal on merits.

The High Court expressly proceeded without going into the merits of the petitioner’s claim. It did not itself order unconditional or automatic restoration of the GST registration.

The precise relief granted was procedural and opportunity-based:

  • liberty to submit a fresh representation within two weeks;
  • representation to be made in terms of Section 30 of the GST Act read with Rule 22(4) of the Rules;
  • request to seek restoration of registration;
  • personal hearing to be afforded by the first respondent;
  • appropriate order to be passed under the governing law and rules within two weeks of receipt of representation; and
  • communication of that order to the petitioner.

Therefore, the legally accurate interpretation is that restoration was not granted automatically by the High Court. The competent authority was directed to consider the petitioner’s fresh representation after providing a personal hearing.

A further clarification is necessary regarding payment of dues: although the petitioner submitted that the entire dues, interest and late fee up to April 2022 had been paid, the Court did not record a final adjudicatory finding independently verifying the correctness or legal effect of such payment.

Sections / Rules Involved

Section 30 of the GST Act – Revocation of Cancellation of Registration:
This provision concerns an application by a registered person for revocation of cancellation of registration in cases falling within its statutory framework. In the present matter, the High Court specifically granted liberty to submit a fresh representation in terms of Section 30 seeking restoration of registration.

Rule 22(4) of the GST Rules – Proceedings Relating to Cancellation of Registration:
The Court expressly coupled Section 30 with Rule 22(4) while directing the petitioner to submit a fresh representation. The order must therefore be reported with both provisions, without expanding the Court’s direction beyond its actual wording.

Link to download the order - https://mytaxexpert.co.in/uploads/1783331189_1130compressed.pdf

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