HC set aside cancellation order due to lack of reasoning on direction of head office

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  • Last Updated on 26 December, 2022

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Cancellation of GST registration

Case Details: S.B.Traders v. Superintendent - [2022] 145 taxmann.com 556 (Telangana)

Judiciary and Counsel Details

    • Ujjal Bhuyan, CJ. & C.V. Bhaskar Reddy, J.

Facts of the Case

In the instant case, a show cause notice was issued to petitioner as to why registration should not be cancelled and it was mentioned that registration was obtained by means of fraud, wilful misstatement or suppression of facts. The petitioner filed reply to show cause notice and on same day order was passed cancelling GST registration on ground that same has been cancelled as per directions of Head Office. The petitioner filed writ petition against the cancellation order.

High Court Held

The Honorable High Court observed that particulars of any fraud, wilful misstatement or suppression of facts had not been mentioned in notice and there was absence of any reason to issue show cause notice for cancellation of registration. Moreover, suspending registration on basis of direction of Head Office could not be a reason for cancellation of GST registration. Thus, the Court held that notice issued and order passed would exhibit complete non-application of mind and therefore, order cancelling registration was liable to be set aside.

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