M/S. Trillion Lead Factory Private Limited vs. Superintendent Of Central Tax
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M/s. Trillion Lead Factory Private Limited (the petitioner) filed a writ petition challenging a show cause notice for cancellation of its GST registration, issued by the Superintendent of Central Tax (the 1st respondent) on December 17, 2025. The petitioner contended that the notice lacked specific charges and was issued at the behest of the Deputy Director, DGGI (2nd respondent). The petitioner argued that the Proper Officer (1st respondent) relied on the same materials from the DGGI investigation without independently arriving at a conclusion regarding alleged violations of Section 16(2)(b) and 16(2)(c) of the CGST Act, 2017. The petitioner had submitted two replies to the show cause notice. The revenue argued that the petitioner understood the charges from supporting documents and had adequately replied, making High Court intervention at this stage improper.
Held
The Court held that while the show cause notice for cancellation of registration primarily alleged violation of Rule 21(e) of the CGST Rules by availing ITC in contravention of Section 16 of the Act, the supporting documents annexed to the notice, which included communication between the DGGI and the Deputy/Assistant Commissioner, clarified the nature of the allegations. The Court found that the petitioner, by filing two detailed replies on December 25, 2025, had demonstrated understanding of the charges, specifically addressing the allegation of availing ITC from non-existent suppliers. Therefore, no prejudice was likely to be caused to the petitioner. The Court concluded that the Proper Officer was at liberty to proceed based on the petitioner's replies and make a decision in accordance with the law within two weeks. The decisions relied upon by the petitioner were deemed not applicable in these circumstances. The writ petition was disposed of with these observations.
Key Issues
1. Whether the show cause notice for cancellation of GST registration, issued by the Superintendent of Central Tax, is vitiated by a lack of specific charges and is issued at the dictation of a superior officer, thereby violating principles of natural justice, as argued by the petitioner? 2. Whether the Proper Officer, in initiating cancellation proceedings, improperly relied on materials from an investigation conducted by the DGGI without independently forming an opinion, as contended by the petitioner? 3. Whether the petitioner's replies to the show cause notice adequately addressed the allegations of availing Input Tax Credit (ITC) in violation of Section 16 of the CGST Act and the Rules, as submitted by the revenue? Petitioner's arguments: The show cause notice is vague and issued under dictation from DGGI. The Proper Officer failed to conduct an independent assessment. Reliance was placed on decisions from the Telangana High Court and Delhi High Court, including M/s. Al Adhil Traders v. Deputy State Tax Officer, Riddhi Siddhi Enterprises v. Commissioner of Goods and Services Tax, South Delhi, and others. Revenue's arguments: The petitioner understood the charges from supporting documents and furnished detailed replies. The DGGI's communication was an information sharing to the Proper Officer, not a directive. Interference at the show cause notice stage is not warranted as no prejudice is caused. Reliance was placed on the fact that the petitioner had furnished two replies.
Sections Cited
Section 16(2)(b), Section 16(2)(c), Section 16, Rule 21(e)
AI-generated summary — verify with the full judgment below
Cause title — parties, addresses and appearances
The Court ffia,Je the following: ORDER
AT FTTDERABAI) The Hon'ble The ChiefJustice Aparesh Kumar Singh and The Hon'ble Sri Justice G.M.Mohiuddin Writ Petition No.537 of 2026' Dated: 02.02.2026 Between: M/s. Tdllion Lead Factory Pdvate Limited, (rep. by its Directot), Bahadurguda, Shamshabad, Rangareddy, Telangana. ...Petitionet and Superintendent of Central Tax, Shamshabad Division, H.No.1-98 /7 /43,VIP Hills, Jai Hind Enclave, Madhapur, Madhapur, Hyderabad and 3 others ..Respondents Order: Fleard lvk. Yammanuru Siri Reddy, learned counsei appearing for the petitioneq Mr. Dominic Femandes, leamed Senior Standing C.ounsel for Gntral Boarrd of Indirect Ta<es and Grstoms (CBIQ, drly assisted by IvIs. Pr:avallika, leamed counsef appearing for respondents No.L to 3 and IVIr. B.Mukherjee, learned counsel representirg }vlr. N.Bhujanga Rao, leamed DeputySoliciror General of India, for respondent No.4. 2. The impugned show cause nodce for cancellation of registration dated 17.12.2025 in Form GST REG 17 has been challenged by the / /
. .'l .. petitioner inter alia on the ground tlut it does not contain the contents of the charges to which the petitioner has to reply that it is issued on the dicta.es of a supertor officer i.e., Deputy Director, DGGI, LilU (respondt:nt No.2), uide is communication dated 17.12.2025 addressed to the Depuqy/Assistant Commissioner of Crntral Tax, Shamshabad Division, vIP r{lls, Hyderabad (respondent No.3); that without coming to a conclusion on the alleged violation of the provisions of Section 16(2Xb) and t6Q)(c) of the Central Goods and Services Tax Act,2017 (for shon 'rhe Act), in respect of the investigation conducred by the Deputy Director, DGGI, lilU (respondent No.2), the Proper officer- Superintendent of Gntral To, Shamshabad Division (respondent No.0 relied upon the same materials ro initiate the proceedings for cancellation of registration. Petitioner has submined rwo replils to the show cause notice for cancellation of registration (Annexur,:s P.16 and P.17).
Lez,rned counsel for the petitioner has placed reliance on a decision c,f this Court in M/s. A1 Adil'Iraders v. Deputy State Tax Officerr rurd also decisions of Delhi F[gh Coun in Riddhi Siddhi Enterprises v. Commissioner of Goods and Services Ta<, South I zozs (l) TMr i69
/ I Delhi2, Ramesh Chander v. Assistant Commissioner of GST, Dwarka Division, CGST Dethi3, Oscar Enteqprises v. Commissioner of GST, Delhia, Namdhari Timber Private Limited v. UOI and otherss, Aiay Gupta v. Sales Tax.Officer and another6 and Sant Ram v. Delhi State GST7. 4.. On the other h*d, learned Senior Standing Cotrnsel for CGST submits that the petitioner has trnderstood the contents of the charges from the supponing documents annexed to the show cause nodce vrhich allege violation of Rule 2l(e) of Gntral Goods and Services Tax Rules, 2017 Sor shon 'the Rules), by avaiknent of Input Tax Gedit (ITq in violation of the provisions of Section t6 of the Act and the Rules made thereunder and fumished rwo replies, rhe first one in Form GST REG18 (Annexure P.16) and rhe second one dated 25.12.2025 (annexure P.L7) wherein all the allegations relating to availment of ITC from non-existent suppliers have been properly replied to by the petitioner. In such circumstances, interference bythis C-oun at the stage of sho-ur cause nodce would not be proper. Respondent No.2- Depury / 2 zoz+ pay csrt, 11e (Del) 3 zoz+ ltzl csrr- 1le (Det) 4 2024 (et) GSTL 134 (Del) s zozs 1ro; T\tfrs42 6 zozs Iq TMI 152s 7 zoz+ 1aq GSTL 23s (Del)
.J ! I I I ! l zi4:i Director. DGGI, tzlJ, has, after referring to the materials uneanhed during irvestigation agairst the petitioner of having availed ITc from non-existent,/non-operating tax payerc, conve)red the information to the Depury/fusistant commissioner, shamshabad Division, CGST, Hyderabad (respondent No.3) with a requesr ro take necessan/ action in accordance with due procedure and principles of natunil ju ce, a copy of which has also been marked to the Range rlfficer, Shamshabad Range, Shamshabad Division. Therefor,:, ir cannot be said that the proper officer (respondent No.O is acting upon the dictates of Depury Director, DGGI (respondr:nt No.2). rft consider:ation would be based upon rhe replies submined by the petitioner. It is submfuted that on these grounds, interference by this c-ourt may not be required since no prejudice is going to be caused to the petitioner. 5. \7e have heard leamed counsel for the parties and considered the submi;sions made.
Though it appears rhat the impugnqd show cause notice for cancellation of registration simply alleges violation of Rule 2r(e) of 5 t\ the Rules by the petitioner by availment of ITC in violation of provisions of Section 16 of the Act and the Rules made thereunder, the show cause notice annexes the supporting document, which is the communication between respondent No.2- Deputy Director, DGGI, Hlderabad, and respondent No.3- Deputy/Assistant C-ommissioner of Gntral Tax, Shamshabad Division, Hyder:abad. Petitioner had, in its replies dated 25.L2.2025, categorically come out with a stand on the allegation of availment of ITC from non- existent suppliers thereby indicating that it has undentood the contents of the impugned show car$e notice. No prejudice is likely to be caused, as the petitioner, having understood the contents of the charges contained in the show cause notice, adequately replied thereto. Respondent No.l.-Proper Officer, in such circumstances, is at liberyto proceed on the basis of the replies to the show cause notice for cancellation of registration, h accordance with law and take a decision thereon within a period of two weeks, In the facts and circumstances, v/e are of the view that the decisions relied upon bythe petitioner would not conrc to its aid. d \
To, 7. Ttre Writ Petition is disposed of wfuh the aforesaid observation. No costs. As a sequel, miscelianeous petitions, pending if any, stand closed. .K.BHAVANI SWAMY ASSISTANT REGISTRAR /// OFFICER
The Superintendent of Central Tax, Shamshabad H. No. 1-g\l7l43, VIP Hills, Jai Hind Enclave, ltlad hapur, Hyderabad-500081 Z. If,p Pqprty Director, Directorate General of GST lntelligence, H. No. 1- 63121212, Plot Nos. 211 and 212, Block-B, Guttala Begumpet, Madhapur,
Ihe Deputy/Assistant Commissioner of Central tax, Shamshabad Division, Banga Rg4dy_GST commissionerate, H. No. 1-981il43, vrp Hills, Jai Hind Enclave, [Iadhapur, Hyderabad-50008 1
The Secretary (Revenue), Union of lndia, Department of Revenue, North Block, lrlew Delhi- I 10001
One CO to SRI YAMMANURU StRt REDDY, Advocate. tOpUCI
One CO to SRI DOMINIC FERNANDES, Senior Standing Counselfor CBIC IoPUC 7. one cc) to SRI N.BHUJANGA RAo.,.Deputy sotjgilor General of lndia, High Court fcrr the State of Telangana at Hydera6ad. IOPUC]
Two Ct)Copies. BSK YY
d ? HIGH CC}URT DATED:(1210212026 () * ORDER WP.No.5:17 of 2026 DISPOSI}IG OF THE WRIT PETITION WITHOUTCOSTS 1HES 2 B [[B 2026 * ,{4 f.* 10 t
Reproduced from the public record of the Telangana High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.