Case Law Details
Aditya Polymers Through Its Proprietor Mr. Shweta Bhatia Vs. Commissioner of Delhi Goods And Services Tax And Another (Delhi High court)
In terms of Section 29(2) of the CGST Act, the proper officer is empowered to cancel the registration from any such date as he may deem fit including from any retrospective date. However, selecting a date from which to cancel the registration cannot be arbitrary. It is essential that the exercise of powers to cancel the registration ab initio, must be based on material on record and some rationale. Further, the taxable person must be put to notice of the proposed action to cancel the registration from a retrospective date so as to provide an opportunity to the said person to show cause why such cancellation should not be from a retrospective date.
In the present case, the show cause notice issued to the petitioner did not mention that the proper officer proposed to cancel the registration with retrospective effect. Thus, the petitioner had no opportunity to address any proposed action of cancellation of registration ab initio.
The learned counsel appearing for the petitioner submits that the petitioner would have no objection if the order cancelling the petitioner’s GST registration is sustained albeit with effect from 11.12.2020 (the date of the show cause notice) instead from 01.07.2017, that is from the date when such registration was granted. The learned counsel appearing for the respondents is also agreeable to the same.
In view of the above, the present petition is disposed of with the direction that the cancellation of the petitioner’s GST registration would take effect from 11.12.2020 and not from 01.07.2017.
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