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Case Law Details

Case Name : Singh Trading Co Vs Sales Tax Officer Class II / Avato (Delhi High Court)
Appeal Number : W.P.(C) 1179/2024
Date of Judgement/Order : 27/02/2024
Related Assessment Year :

Singh Trading Co Vs Sales Tax Officer Class II / Avato (Delhi High Court)

Introduction: The Delhi High Court recently ruled on a significant case involving the cancellation of GST registration for Singh Trading Co. The petitioner contested the cancellation order, citing procedural irregularities and lack of evidence. This article delves into the details of the case, analyzing the court’s judgment and its implications.

Detailed Analysis:

1. Cancellation Order Basis: The cancellation of GST registration stemmed from allegations of tax evasion levied against Singh Trading Co. The show cause notice cited the involvement of the firm in a tax evasion scam, prompting the cancellation action.

2. Petitioner’s Response: Despite being served with a show cause notice, the petitioner failed to submit a response. However, the petitioner raised concerns regarding procedural deficiencies, including the lack of specific details and the absence of a designated appearance date.

3. Court’s Observations: The Delhi High Court scrutinized the proceedings and noted discrepancies in the issuance of the show cause notice. The court highlighted the failure to provide essential documents and information to the petitioner, impairing their ability to mount a defense effectively.

4. Judicial Directive: In its judgment dated 19.09.2023, the Delhi HC set aside the cancellation order. The court directed the Proper Officer to furnish all relevant material supporting the show cause notice to the petitioner within one week. Additionally, the petitioner was granted a week to respond, followed by re-adjudication within a stipulated timeframe.

Conclusion: The verdict by the Delhi High Court in the Singh Trading Co case underscores the importance of due process and fair treatment in tax-related matters. The judgment emphasizes the necessity for authorities to provide adequate documentation and opportunity for response to accused parties. This ruling serves as a reminder of the judiciary’s commitment to upholding procedural integrity and safeguarding the rights of taxpayers.


1. Petitioner impugns order dated 19.09.2023, whereby, the GST registration of the petitioner has been cancelled. Said cancellation order was issued pursuant to a show cause notice for cancellation dated 20.07.2023.

2. The reason mentioned in the show cause notice for proposed cancellation was:-

“The Addl. Commissioner of State Tax-1 (Inv) vide letter No. PA/Addl./CST-01/446-448 dated 17-07-2023 has inform that the firm is involved in a big scam of evasion of tax.”

3. Petitioner was thereupon called upon to submit a reply, however, no reply was submitted by the petitioner.

4. As per the petitioner, neither the copy of letter of the Additional Commissioner dated 17.07.2023, referred to in the show cause notice was provided, nor any further information was provided. Petitioner was called upon to appear on the date and time notified in the show cause notice, however, the show cause notice does not mention any date, time or venue where the petitioner had to appear.

5. As per the respondents, there is material available to establish that the petitioner firm was involved in big scam of evasion of tax. However, it is conceded that the said material has not been provided to the petitioner in support of the show cause notice.

6. In view of the above, impugned order dated 19.09.2023 is set aside. Proper Officer is directed to furnish all material that the Proper Officer may have in support of the show cause notice to the petitioner within one week from today. Thereafter, petitioner shall file a reply thereto within one week. The Proper Officer shall thereafter re-adjudicate the show cause notice within a maximum period of two weeks after giving an opportunity of personal hearing to the petitioner.

7. Petition is accordingly disposed of in the above terms.

8. Needless to state that petitioner shall be entitled to avail of such remedies as permissible in law if aggrieved by any order/action of the respondents.

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April 2024