Mehra MAC Industries Private Limited Vs Deputy State Tax Officer (Telangana High Court)
Telangana High Court Sets Aside GST Registration Suspension Due to Portal Technical Glitches
Summary: The Telangana High Court, in Mehra MAC Industries Private Limited Vs Deputy State Tax Officer, set aside the show cause notice proposing cancellation of GST registration and the consequential suspension of registration with effect from 12 October 2026 on the ground of violation of natural justice. The petitioner contended that it was unable to access the GST portal and, consequently, could not submit its response to the show cause notice or participate in subsequent proceedings. During the initial hearing, the Special Government Pleader for State Tax sought time to ascertain the factual position. At the subsequent hearing, the Department admitted that certain technical glitches prevented the petitioner from accessing the GST portal. Taking note of this admission, the High Court held that the issuance of the cancellation notice and suspension of registration were legally unsustainable as the petitioner had been denied an effective opportunity to respond, contrary to the principles of natural justice. Accordingly, the Court set aside both the impugned show cause notice and the suspension order while reserving liberty to the Department to initiate fresh proceedings strictly in accordance with law. The writ petition was disposed of without any order as to costs. The judgment reiterates that technical failures in the GST portal cannot justify adverse proceedings that deprive taxpayers of an effective opportunity to respond.
FULL TEXT OF THE JUDGMENT/ORDER OF TELANGANA HIGH COURT
Learned counsel Dr. S.Suri Babu appears for the petitioner.
Sri Swaroop Oorilla, learned Special Government Pleader for State Tax, appears for the respondents.
2. When the matter was taken up yesterday, it was informed by the learned counsel for the petitioner that the petitioner was not able to open the portal and therefore, it could not submit its response either to the show cause notice or to any other proceedings in between. Learned Special Government Pleader for State Tax appearing for the respondents took time to ascertain the factual position.
3. Today when the matter is taken up for hearing, learned Special Government Pleader for State Tax, on instructions, submits that, in fact, the petitioner could not open the portal because of certain technical glitches.
4. Given the aforesaid submission of the learned Special Government Pleader for State Tax, we are of the considered opinion that the action on the part of the respondents in issuing the show cause notice for cancellation of registration and also suspending the registration with effect from 12.10.2026 is unsustainable in law as it would be a decision without following the principles of natural justice.
5. Accordingly, the impugned show cause notice and also the order of suspension are set aside. However, the right of the respondents stands reserved to initiate appropriate proceedings, if they intend to do so, strictly in accordance with law.
6. The writ petition is accordingly disposed of. There shall be no order as to costs.
Miscellaneous applications pending, if any, shall stand closed.
