A P Enterprises Vs Sales Tax Officer Class II /AVATO (Delhi High Court)
In the case of A P Enterprises vs Sales Tax Officer Class II/AVATO, the petitioner challenged a Show Cause Notice (SCN) dated 13.11.2023 and a subsequent GST registration cancellation order issued on 24.11.2023. The petitioner argued that the SCN lacked specific details, merely citing Rule 21(g) of the CGST Rules, which pertains to the issuance of invoices without the supply of goods, and alleging a violation of Rule 86B. However, the SCN did not provide any information about the invoices or transactions that were allegedly in violation. This lack of detail prevented the petitioner from understanding the basis of the accusations and responding meaningfully to defend against the proposed cancellation. Moreover, the GST registration was suspended immediately and ultimately cancelled with retrospective effect from 03.04.2023, without sufficient grounds for such retroactive application.
The petitioner’s GST registration was later cancelled, with the cancellation order introducing a new reason—that the petitioner’s firm was found non-functional during a GST investigation report dated 24.11.2023. This new ground was not mentioned in the SCN, nor was the petitioner provided with a copy of the GST investigation report or given an opportunity to respond to it. The absence of these details violated principles of natural justice, as the petitioner was not given a fair chance to present their case.
