Summary: In the case of Kunhalavi N. v. State Tax Officer [W.P. (C) No. 17333 of 2024], the Kerala High Court invalidated a GST registration cancellation order due to improper issuance of the show cause notice (SCN). The Petitioner, Kunhalavi N, challenged the cancellation order on grounds that the SCN was issued in Form GST REG-31 rather than the mandated Form GST REG-17, as required by Rule 22(1) of the Central Goods and Services Tax Rules (CGST Rules). The Petitioner argued that he was unable to respond to the SCN due to personal reasons and that the notice was also vague. The High Court ruled that procedural adherence is crucial and since the SCN was not issued in the correct format, the cancellation order was deemed void. Consequently, the court set aside the order and instructed the Petitioner to file the overdue returns, including taxes and penalties, within two weeks after the GST registration is reinstated.
The Hon’ble Kerala High Court in Kunhalavi N. v. State Tax Officer [W.P. (C) No. 17333 of 2024 dated June 10, 2024], set aside the order for cancellation of registration, thereby holding that show cause notice not issued in proper form is void in nature in case where the notice was issued in Form GST REG-31 instead of required Form GST REG-17.
Facts:
Kunhalavi N (“the Petitioner”), filed a writ petition against order dated July 13, 2022 (“the Impugned Order”) passed by the Revenue Department (“the Respondent”) on the ground of not filing of returns and not responding to the show cause notice (“the SCN”) issued for which Petitioner couldn’t file reply as he was busy in the treatment of his father. Also, the Respondent issued notice in Form GST-REG-31 instead of required Form GST-REG 17 for issuance of SCN regarding cancellation of GST Registration. Also, the SCN issued by the Respondent is vague in nature.
Issue:
Whether the Show cause notice not issued in proper form is void in nature?
Held:
The Hon’ble Kerala High Court in W.P. (C) No. 17333 of 2024 held as under:
- Noted that, when the statue provides for a thing to be done in a particular manner, then it has to be done as per the procedure prescribed.
- Opined that, as the SCN has been issued in Form GST REG-31 instead of Form GST REG-17 as required under Rule 22(1) of the Central Goods and Services Tax Rules (“the CGST Rules”), the Impugned Order issued for cancellation of GST registration is without jurisdiction.
- Held that, the Impugned Order is set aside
- Directed that, the Petitioner is required to file the defaulted returns along with tax, late fee, interest, penalty within the period of two weeks from the date on which the registration of the Petitioner is restored in compliance with the judgment.
******
(Author can be reached at [email protected])
Author Bio
