Tvl. Sri Balajee Udyog Vs Assistant Commissioner (ST) (Madras High Court)
In , the Madras High Court dealt with an intra-court appeal filed by a proprietorship concern challenging cancellation of its GST registration. The appellant had obtained GST registration on 05.04.2022 for premises situated at Mookar Nallamuthu Street, Chennai. During inspection by the Assistant Commissioner (CT), it was found that the premises were allegedly insufficient for carrying on business involving huge Input Tax Credit (ITC) claims. Consequently, a show cause notice dated 14.11.2024 was issued calling upon the appellant to furnish details regarding actual movement of goods and to appear for personal hearing.
The appellant submitted a detailed reply and participated in the personal hearing. However, the Assistant Commissioner (CT), not being satisfied with the explanation and records produced, cancelled the GST registration through order dated 29.11.2024. The appeal filed before the Deputy Commissioner (CT) was dismissed, and the order of cancellation was confirmed. Thereafter, the appellant filed a writ petition under Article 226 challenging the appellate order dated 27.01.2025, but the learned Single Judge dismissed the writ petition. The present intra-court appeal was filed against that decision.
Before the Division Bench, the appellant contended that one of the grounds for cancellation was that the appellant shared business premises with another entity, M/s Gaurav Metal, allegedly to camouflage transactions. The appellant argued that there was no legal prohibition on different traders operating from the same premises and that mere co-location could not justify cancellation of GST registration under Section 29(2) of the GST Act or Rule 21 of the CGST Rules.
