In W.P.(C)14250/2022-DEL HC- Delhi HC orders restoration of Company's Registration under CGST Act, 2017 as response to Show Cause Notice was not considered while passing cancellation Order 
Justices Vibhu Bakhru & Amit Mahajan [09-02-2023]

Read Order: M/S. RAKESH ENTERPRISES v. THE PRINCIPAL COMMISSIONER CENTRAL GOODS AND SERVICES TAX & ORS 

LE Correspondent

New Delhi, February 15, 2023: The Delhi High Court has allowed a petition impugning an order of the Superintendent whereby the petitioner's registration under the Central Goods and Services Tax Act, 2017 was canceled. 

In this matter before the Division Bench of Justice Vibhu Bakhru and Justice Amit Mahajan, the said order was passed in furtherance of the proceedings commenced by the Show Cause Notice and the allegation against the petitioner was that it had defaulted in filing the returns for more than six months.

The petitioner had allegedly responded to the said Show Cause Notice by filing a reply and it was the petitioner’s case that the same had not been filed along with the petition as the copy of the same was not readily available. 

From the respondent’s side it was submitted that the case history did not reflect that the petitioner had filed any response to the Show Cause Notice possibly, there was a technical glitch and the reference to the reply had been automatically generated.

The Bench was unable to accept that the petitioner had not filed a response to the Show Cause Notice, as the order expressly referred to the petitioner's response to the Show Cause Notice. As per the Bench, the Order did not indicate as to the contents thereof or reflected any discussion in respect of the petitioner's explanation.

Finding merit in the petitioner’s contention that the impugned order couldnot be sustained, the Bench noted that there was no dispute that the petitioner has filed its returns, albeit belatedly, and had also paid the tax and penalty in accordance with the Act.

The Bench also referred to the judgment of the Madras High Court in TVL. Suguna Cutpiece Center v. Appellate Deputy Commissioner (ST) (GST),2022 (61) G.S.T.L. 515 (Mad.), wherein it was observed that it is not the intention of the authorities to debar and de-recognise assessees from coming back into the Goods and Service Tax (GST) fold. 

“ It is not necessary for this Court to examine whether the time period as stipulated under Section 30 of the Act is mandatory in this case. This is because it is apparent that the impugned order dated 28.12.2020, cancelling the petitioners registration is unsustainable as it does not consider the petitioners response to the Show Cause Notice”, the Bench said while setting aside the impugned order and directing the respondents to restore the petitioner’s Registration.