M/S. Vindu Trading vs. Office Of Deputy Commissioner, State Tax, GST Appeal And Ors

Held

The Court held that the impugned order dated 24 March 2023 was liable to be set aside on the grounds of failure of natural justice. The Court noted that the Show Cause Notices, referred to in the impugned order, were issued on 26 August 2022 and 1 December 2022, by which date the Petitioner's registration had already been cancelled. The Petitioner claimed not to have received these notices, and the service issue was unclear. Crucially, the Petitioner's registration cancellation, effective 30 November 2021, was reflected on the department's portal. The Court found that the Petitioner was factually not heard before the impugned order was made. Consequently, the matter was remanded to the Appellate Authority for fresh consideration of the appeal, with directions to dispose of it by 31 December 2024. The Petitioner was directed to appear before the Appellate Authority on 25 November 2024.

Facts

The Petitioner, M/s. Vindu Trading, challenged an order dated 24 March 2023 by the Appellate Authority, which allowed the Respondent's appeal and changed the effective date of GST registration cancellation to ab-initio (01/07/2021). The Petitioner's GST registration was initially cancelled on 11 October 2021 for failing to update bank details, but was restored on 11 November 2021. Subsequently, the Petitioner applied for cancellation of registration effective 30 November 2021, which was granted. The Respondent's appeal was against the initial cancellation order of 11 October 2021. The impugned order directed the cancellation to be effective from 01/07/2021.

Key Issues

1. Whether the impugned order dated 24 March 2023, which altered the effective date of GST registration cancellation to ab-initio (01/07/2021), was passed in violation of the principles of natural justice, particularly concerning the Petitioner's right to be heard, under Section 107 of the MGST Act, 2017? Petitioner's contentions: The Petitioner argued that no valid notice of the appeal was served. The Show Cause Notices referenced in the impugned order were issued in 2022, after the Petitioner's registration had already been cancelled. The Petitioner's portal also indicated cancellation at their request effective 30 November 2021. Therefore, the impugned order violated principles of natural justice and fair play. Respondents' contentions: The Respondents contended that Show Cause Notices were served at the address indicated in the application for cancellation of registration, and thus, there was no breach of natural justice or fair play.