Case Law Details
K.C.P India Vs Commissioner (Delhi High Court)
The Delhi High Court recently delivered a significant ruling in the case of K.C.P India vs Commissioner regarding the retrospective cancellation of Goods and Services Tax (GST) registration. The court’s decision sheds light on the procedural and substantive aspects of GST registration cancellation, particularly focusing on the retrospective aspect of such cancellations.
The case revolved around an order dated January 1, 2021, wherein the GST registration of K.C.P India was cancelled retrospectively from July 1, 2017. This decision was preceded by a Show Cause Notice issued on September 1, 2020, citing non-filing of returns for a continuous period of six months as the reason for potential cancellation.
K.C.P India, engaged in the manufacturing of PVC, had initially applied for the cancellation of its GST registration on May 6, 2019, citing the closure of business. However, no response or order was communicated regarding this application. Subsequently, the impugned Show Cause Notice was issued based on the grounds of non-filing of returns.
The court scrutinized the procedural irregularities in the issuance of the Show Cause Notice and the subsequent order for cancellation. It noted that neither the notice nor the order provided adequate reasons for the retrospective cancellation of registration. Additionally, the court highlighted the absence of any objective criteria or justification for such retrospective action.
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