Notice is mandatory for physical verification of place of business under Rule 25 of CGST Rules, 2017

Bimal Kothari Vs Assistant Commissioner (DSGST) & Ors (Delhi High court)

The Hon’ble Delhi High Court (“the High Court”) in the case of M/s. Bimal Kothatri v. Assistant Commissioner (DSGST) & Ors. [(W.P.(C) 9207/2019 & CM No. 37947/2019] dated November 01, 2022, held that cancellation of GST registration is not sustainable when no notice was serviced upon the registered person for conducting physical verification of business premise under Rule 25 of the Central Goods and Services Tax Rules, 2017 (“the CGST Rules”) which was not given, clearly violating the provision of the law.

Facts:

M/s. Bimal Kothari (“the Petitioner”) is a Goods and Services Tax (“GST”) registered person who shifted his place of business and intimated the GST department with an application stating the new place of business and old place of business in June 2018. However, reference number was not generated resulting non-updation of place of business on common portal. Assistant Commissioner, DSGST (“the Respondent”) issued a show cause notice (“SCN”) dated December 04, 2018, requiring the Petitioner to appear before the concerned officer on December 12, 2018. The Petitioner submitted a reply of such SCN dated December 07, 2018, referring application of change of place of business. However, such a reply was not uploaded on common portal. Therefore, the concerned officer did not consider the said reply. The Respondent vide order dated December 17, 2018, cancelled the GST registration of the Petitioner on account of no business found on physical verification of business premise on the address available with the GST Authority (“the Authority”).

The Petitioner filed a writ petition in the High Court seeking to quash the order of cancellation of GST registration dated December 17, 2018.

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