HC sets aside SCN & order of cancellation of registration being failed to divulge misdeed

Case Details: S.A. Traders v. Goods & Service Tax Officer - [2022] 145 taxmann.com 562 (Andhra Pradesh)

Judiciary and Counsel Details

• • UDPR & TMR, JJ.

Facts of the Case

The registration was petitioner was cancelled by the department. In the show cause notice, it was mentioned “in case the registration has been obtained by means of fraud, willful misstatement or suppression of facts” and equally in the cancellation order, it was mentioned:

“On verification of GSTR 1 v. GSTR 3B returns and sales turnover, it is observed that, within a span of five months, the petitioner made purchase and sale of scrap worth of Rs.9.63 Crores for which he has not submitted clear records. Hence the transactions appear to be suspicious and hence registration is hereby cancelled”.

It filed writ petition before the High Court and submitted that both show cause notice and order didn’t mention any violation by the petitioner.

High Court Held

The Honorable High Court observed that the impugned show cause notice and order of cancellation of registration didn’t divulge into any mistake or fraud or misdeed committed by petitioner in due course of his business. The Court also noted that both show cause notice, as well as order of cancellation of registration, were dubious and they were failing to divulge misdeed or fraud committed by petitioner. Thus, the Court held that writ petition was allowed and the impugned order for cancellation of registration was liable to be set aside.