HC rejected application for registration under GST for failure to disclose principal place

Case Details: B.C.Mohankumar Sole Proprietor of BCVM Traders v. Superintendent of Central Goods & Service Tax - [2022] 145 taxmann.com 324 (Madras)

Judiciary and Counsel Details

• • Dr. Anita Sumanth, J.
  • Adithya Reddy for the Petitioner.
  • Prakash & Rajendran Raghavan, Sr. Standing Counsel for the Respondent.

Facts of the Case

The petitioner had made an application seeking new GST registration. A notice was issued by the department seeking a clarification with respect to the application for registration. The clarification sought was that the application did not enclose the details of principal place of business of the petitioner. The petitioner duly responded by uploading a copy of the rental/lease deed duly registered in the office of the Sub-Registrar as proof of principal place of business. However, the application was rejected and it filed writ petition against the order contending that order was cryptic and entirely non-speaking.

High Court Held

The Honorable High Court noted that the petitioner responded to objection raised by department and uploaded copy of rental/lease deed duly registered in office of Sub-Registrar as a proof of principal place of business, but the rejection of application simply by a monosyllabic order i.e. ‘rejected’ was indefensible and not sustainable inasmuch as such order of this nature was non-speaking, arbitrary and failed to take into account explanation furnished by petitioner.

The Court also held that the contention of department that word ‘may’ occurring in Rule 9(4) of Central Goods and Services Tax Rules, 2017 grants discretion to authority to assign reasons, would not be acceptable as said word only refers to discretion to reject and not to blatantly violate principles of natural justice. Therefore, the Court directed department to pass reasoned order after hearing petitioner on objections raised by it.