Rasi Innovation Pvt Ltd Vs Superintendent (Delhi High Court)
Delhi High Court has directed the Goods and Services Tax (GST) authorities to be precise in specifying the exact provisions of the GST Act and Rules violated when issuing show cause notices (SCNs) for registration cancellation. This directive came during the hearing of a petition filed by Rasi Innovation Pvt. Ltd., challenging the retrospective cancellation of its GST registration.
The case, Rasi Innovation Pvt. Ltd. v. Superintendent, centered on an SCN issued to the petitioner on March 10, 2023, for the cancellation of its GST registration. The stated reason for cancellation in the SCN was a generic “Non-compliance of any specified provisions in the GST Act or the Rules made thereunder as may be prescribed.”
The petitioner, Rasi Innovation Pvt. Ltd., had obtained its GST registration on May 9, 2018. According to their counsel, Mr. Rai, the company’s Director, Mr. Rakesh Jain, suffered from ill health in September 2022, leading to a delay in filing GST Returns. However, it was submitted that the returns were subsequently filed until March 2023. The petitioner primarily challenged the retrospective nature of the cancellation, which was made effective from May 10, 2018.
During the proceedings, Mr. Benjamin, the Senior Standing Counsel for the Respondent-Department, indicated that GST registration cancellation orders are typically effective from the date of the SCN. He suggested that the retrospective application might have been due to the non-filing of GST returns.
