A P Enterprises Vs Sales Tax Officer Class II /Avato (Delhi High Court)
In the case of A P Enterprises vs. Sales Tax Officer Class II/Avato, the petitioner challenged a Show Cause Notice (SCN) dated November 13, 2023, which proposed to cancel its GST registration, and an order dated November 24, 2023, which cancelled the GST registration retroactively from April 3, 2023. The SCN cited violation of Rule 21(g) of the CGST Rules, alleging that A P Enterprises issued invoices without supplying goods, but failed to provide specifics of the transactions in question. Despite filing an appeal under Section 107 of the CGST Act, the petitioner was unsuccessful, with the Appellate Authority dismissing the appeal on May 30, 2024. The petitioner’s ability to appeal further was constrained by the absence of a GST Tribunal. The Delhi High Court found that the SCN lacked sufficient details to enable the petitioner to respond adequately and noted that the cancellation order was based on reasons not included in the SCN, such as the petitioner being found non-functioning. This discrepancy violated principles of natural justice. Consequently, the Court set aside both the SCN and the cancellation order, instructing the restoration of the petitioner’s GST registration but allowing the respondent to initiate fresh proceedings in accordance with the law if necessary.
