Order cancelling GST registration without notice in Form REG-17 is unsustainable

Western Offshore & Marine Projects Pvt. Ltd Vs State Tax Officer (Kerala High Court)

Kerala High Court held that issuance of order cancelling GST registration without issuance of show cause notice in form REG-17 is unjustified. Matter remanded to complete the necessary proceedings.

Facts-

The petitioner has approached the Court challenging an order issued by the State Tax Officer canceling the registration granted to the petitioner under the provisions of Central Goods and Services Tax (CGST)/State Goods and Services Tax Act (SGST). It is the case of the petitioner that the provisions of Section 29 r/w Rule 22 of the CGST/SGST Rules clearly indicate that the petitioner was entitled to a show cause notice before an order or cancellation is issued in terms of Section 29.

The show cause notice is to be issued in From REG-17 before cancellation of registration. It is a specific case of the petitioner that no such notice was issued and the only notice issued to the petitioner was one regarding the suspension of his registration in Form REG-31.

Conclusion-

Held that as the show cause notice in form REG-17 was not generated/ issued before issuance of order cancelling GST registered in terms of section 29, the writ petition challenging the impugned order is allowed. However, the matter is remitted to the 1st respondent to complete the proceedings against the petitioner in accordance with law. As a consequence of this order, the registration of the petitioner which was canceled by Ext.P4 order will stand restored till a fresh decision is taken by the 1st respondent.

FULL TEXT OF THE JUDGMENT/ORDER OF KERALA HIGH COURT

The petitioner has approached this Court challenging Ext.P4 order issued by the 1^st respondent canceling the registration granted to the petitioner under the provisions of CGST/SGST Act. It is the case of the petitioner that the provisions of Section 29 r/w Rule 22 of the CGST/SGST Rules clearly indicate that the petitioner was entitled to a show cause notice before an order or cancellation is issued in terms of Section 29. The show cause notice is to be issued in From REG-17 before cancellation of registration. It is a specific case of the petitioner that no such notice was issued and the only notice issued to the petitioner was one regarding the suspension of his registration in Form REG-31.

2. The learned Senior Government Pleader very fairly admits that a show cause notice in form REG-17 has not been issued to the petitioner. It is submitted that the necessary notice ought to have been automatically generated. However, she submits that without standing on technicalities, the matter can be remitted to the 1^st respondent for considering the case of the petitioner.

3. Having heard the learned counsel for the 3rd respondent also, this writ petition is allowed. Ext.P4 order is quashed. The matter is remitted to the 1^st respondent to complete the proceedings against the petitioner in accordance with law. As a consequence of this order, the registration of the petitioner which was canceled by Ext.P4 order will stand restored till a fresh decision is taken by the 1^st respondent.

4. It is make clear that the the quashing of Ext.P4 will not prevent the 1^st respondent from initiating or continuing any proceedings for cancellation of registration against the petitioner, in accordance with law.