HC sets aside GST Registration Cancellation Order due to Lack of Consideration

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  • By Taxmann
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  • Last Updated on 16 April, 2023

GST Registration Cancellation

Case Details: Parshant Timber v. Commissioner of Delhi Goods and Services Tax - [2023] 149 taxmann.com 217 (Delhi)

Judiciary and Counsel Details

    • Vibhu Bakhru & Amit Mahajan, JJ.
    • Rakesh KumarSubhash Chandra GuptaParveen Kumar GambhirShailendra Kr. Verma, Advs. for the Petitioner.
    • Rajeev AggarwalMs Shilpa SinghMs Divyanshi Bansal, Advs. for the Respondent.

Facts of the Case

The petitioner had made an application praying that his registration to be cancelled and the reason for seeking cancellation of the registration was disclosed as “Discontinuance of business/Closure of business”. The department issued notice which stated that “Please reply ASMT 10 and pay due tax with interest and penalty”.

The petitioner didn’t respond to the notice and the application was rejected by the department without providing any reasons. It filed writ petition before the High Court to challenge the rejection of cancellation application and contended that he has a right to seek cancellation of the registration on ground of closure of business.

High Court Held

The Honorable High Court noted that the business was closed and cancellation of GST registration was sought and therefore, returns were not filed for subsequent period. However, the impugned order stating reply as considered had been passed without application of mind as no reply was filed by the petitioner.

Moreover, the impugned order was unsustainable as it did not disclose any reason. The Court also noted that the show cause notice was cryptic and did not mention particular reason for rejecting application of petitioner. Therefore, the Court held that the petition was allowed and Authority was directed to cancel registration from date requested.

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