Suresh Chand Gupta Vs Union of India And Ors (Delhi High Court)
In the case of Suresh Chand Gupta Vs Union of India and Others, the Gujarat High Court examined the procedural validity of the cancellation of the petitioner’s GST registration. The petitioner challenged the Show Cause Notice (SCN) issued on May 19, 2023, and the subsequent cancellation order dated June 20, 2023. The SCN proposed the cancellation of GST registration under Section 29(2)(e) of the CGST Act, 2017, citing fraud, willful misstatement, or suppression of facts. However, the SCN failed to provide specific details about the alleged fraud or misstatement, rendering it vague and insufficient for the petitioner to respond effectively. Furthermore, the cancellation order, issued retrospectively from July 24, 2019, lacked independent reasoning and solely referred to the cryptic SCN, raising concerns about the violation of natural justice principles.
The court highlighted that the SCN and subsequent order did not meet the requisite standards of clarity and specificity required under law. Moreover, despite the petitioner’s attempt to seek revocation of the cancellation, the rejection was based on additional allegations not initially mentioned in the SCN, including ineligible Input Tax Credit (ITC) claims linked to a non-existent firm. The court found procedural lapses, including retrospective cancellation without prior notice and failure to consider the petitioner’s illness as a valid reason for delayed responses. Consequently, the court set aside the cancellation order and directed the restoration of the GST registration, allowing the proper officer to initiate fresh proceedings in compliance with the law.
