Goyal Brothers Vs Commissioner (Punjab and Haryana High Court)
The Punjab and Haryana High Court partly allowed the petition challenging the retrospective cancellation of GST registration through order dated 15.06.2025. The petitioner limited the present proceedings only to the challenge against retrospective cancellation and sought liberty to separately challenge the recovery from the Electronic Cash Ledger dated 27.05.2025 and adjudication order dated 18.02.2025, which the Court permitted. The Court found that before retrospectively cancelling the GST registration, the authorities had not issued any specific notice informing the petitioner that such retrospective action was proposed. The show cause notice preceding the impugned order did not indicate that retrospective cancellation was contemplated. Relying on the Division Bench judgment in M/s Bansal Casting vs. Union of India and another dated 20.02.2026, the Court reiterated that although Section 29 of the CGST Act permits retrospective cancellation, such action can be taken only upon existence of specific contingencies and the order must disclose reasons for retrospective effect. The Court also emphasized that principles of natural justice require authorities to clearly notify the assessee of the proposed action and the grounds relied upon. Since no such specific notice was served, the impugned order dated 15.06.2025 was set aside, with liberty granted to the respondents to proceed afresh in accordance with law. The petitioner was also permitted to file separate petitions regarding the remaining grievances.
