Judgment
IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR.JUSTICE C.S.DIAS WEDNESDAY, THE 5TH DAY OF JULY 2023 / 14TH ASHADHA, 1945 WP(C) NO. 21181 OF 2023 PETITIONER:
ELVIS SAJAN MATHEW, AGED 25 YEARS 395/C, NUEVO, VADAVATHUR, VIJAYAPURAM, KOTTAYAM, PIN- 686010 BY ADVS.
SABU C.J APARNA ANIL S.ANIL KUMAR (TRIVANDRUM) RAHUL A.
RESPONDENTS:
1 ASSISTANT COMMISSIONER, SGST DEPT, COMMERCIAL TAX OFFICE, II CIRCLE, KOTTAYAM.PIN-686002 2 COMMISSIONER OF STATE TAXES, STATE GST DEPT, TAX TOWERS, KARAMANA, THIRUVANANTHAPURAM, PIN - 695002 3 UNION OF INDIA, REPRESENTED BY THE SECRETARY, DEPARTMENT OF REVENUE, MINISTRY OF FINANCE, GOVERNMENT OF INDIA, NORTH BLOCK, NEW DELHI, PIN - 110001 OTHER PRESENT:
SR GOVERNMENT PLEADER SMT THUSHARA JAMES DEPUTY SOLICITOR GENERAL OF INDIA SRI. MANU S.
THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 05.07.2023, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:
WP(C) NO. 21181 OF 2023 2 Dated this the 5th day of July, 2023 JUDGMENT The writ petition is filed to quash Ext.P4 order passed by the first respondent cancelling the petitioner’s GST registration.
2. The petitioner’s case is that, he is the proprietor of a concern which has a KSGST/CGST registration. For the period from March 2022 to August 2022, there had occurred some delay in submitting Form GSTR 3B return. Consequently, the first respondent had issued Ext.P2 show cause notice to cancel the petitioner’s registration. Immediately, on 3.11.2022, the petitioner filed Ext.P3 return for the month of March, 2022. The authorised officer was obliged to issue notice in terms of proviso to Section 29(2) of the Acts, which is a mandatory requirement to cancel the registration. By Ext.P5 judgment passed by this Court in M/s Phoenix
WP(C) NO. 21181 OF 2023 3 Rubbers v. The Commercial Tax Officer, the above point stands squarely covered. After a long lapse of time, the first respondent has issued Ext.P4 order cancelling the petitioner’s registration. The entire proceedings leading to Ext.P4 is patently erroneous and vitiated by errors of law. Hence, the writ petition.
3. Heard; Sri.Sabu C.J, the learned counsel appearing for the petitioner, Smt. Thushara James, the learned Senior Government Pleader appearing for the respondents 1 and 2 and Sri. S. Manu, the learned Deputy Solicitor General of India appearing for the 3rd respondent.
4. On a perusal of the pleadings and materials on record, it is apparent that the petitioner had not submitted Form GSTR 3B return for the period from March 2022 to August, 2022. Consequently, the first respondent issued Ext.P2 show cause notice on 7.10.2022, directing the petitioner to show cause why his
WP(C) NO. 21181 OF 2023 4 registration shall not be cancelled for failure to furnish the returns for a continuous period of six months.
5. The petitioner asserts that, subsequent to Ext.P2 dated 7.10.2022, the petitioner has submitted his return for the month of March 2022 on 3.11.2022. This assertion is not disputed by the respondents.
6. A reading of Ext.P2 show cause notice reveals that the notice is quite vague and issued without any application of mind. I say this because the first respondent has not stated the specific months during which the petitioner has failed to file his returns.
7. Admittedly, the petitioner has filed his returns for the month of March 2022 on 3.11.2022, which is subsequent to the show cause notice and prior to Ext.P4 cancellation order. Thus, I am of the view that as Ext.P2 show cause notice or Ext.P4 order do not advert to any of these aspects, the same is passed in flagrant violation of the principles of natural justice, because the petitioner
WP(C) NO. 21181 OF 2023 5 has been denied his right of defence to Ext.P2 show cause notice.
8. It is trite; that quasi-judicial authorities have to function with fairness, openness and reasonableness.
9. Ext.P2 show cause notice and Ext.P4 order substantiates that the respondents have acted in haste and in an unreasonable manner, denying the petitioner a fair opportunity to defend himself. Hence, Exts.P2 and P4 suffer from the errors of law and are liable to be quashed by exercising the extraordinary powers of this Court under Article 226 of the Constitution of India.
Resultantly, I allow the writ petition as follows:- (i) Exts.P2 and P4 orders are quashed.
(ii) The respondents would be at liberty to issue a fresh show cause notice to the petitioner specifically mentioning the period during which he has failed to file the return under the GSTR 3B.
(iii) If the respondents issue such fresh show cause
WP(C) NO. 21181 OF 2023 6 notice, then they shall grant the petitioner a fair opportunity to submit his defence and a reasonable opportunity of being heard, before finalising the proceedings.
SD/- rmm5/7/2023 C.S.DIAS, JUDGE
WP(C) NO. 21181 OF 2023 7 APPENDIX OF WP(C) 21181/2023 PETITIONER EXHIBITS Exhibit P1 A COPY OF THE RETURN FOR THE MONTH OF FEBRUARY, 2022 IN GSTR-3B FILED ON 31-03- 2022 Exhibit P2 A COPY OF THE SHOW CAUSE NOTICE DATED 7/10/2022 ISSUED BY THE FIRST RESPONDENT Exhibit P3 A COPY OF THE RETURN FOR THE MONTH OF MARCH, 2022 IN GSTR-3B FILED ON 03-11- 2022 Exhibit P4 A COPY OF THE ORDER DATED 8/01/2023 ISSUED BY THE 1ST RESPONDENT Exhibit P5 A COPY OF THE JUDGMENT OF THIS HON'BLE COURT DATED 03-02-2020 IN WP(C) NO. 35159 OF 2019 [PHOENIX RUBBERS VS THE COMMERCIAL TAX OFFICER AND OTHERS] Exhibit P6 A COPY OF THE CIRCULAR NO. 3/2023 DATED 31ST MARCH, 2023 Exhibit P7 A COPY OF THE RETURN FOR THE MONTH OF APRIL, 2022 IN GSTR-3B FILED ON 10-11- 2022 Exhibit P8 A COPY OF THE RETURN FOR THE MONTH OF MAY, 2022 IN GSTR-3B FILED ON 13-01-2023 Exhibit P9 A COPY OF THE RETURN FOR THE MONTH OF JUNE, 2022 IN GSTR-3B FILED ON 06-04-2023 Exhibit P10 A COPY OF THE RETURN FOR THE MONTH OF JULY, 2022 IN GSTR-3B FILED ON 12-05-2023 Exhibit P11 A COPY OF THE RETURN FOR THE MONTH OF AUGUST, 2022 IN GSTR-3B FILED ON 15-05- 2023
WP(C) NO. 21181 OF 2023 8 Exhibit P12 A COPY OF THE RETURN FOR THE MONTH OF SEPTEMBER, 2022 IN GSTR-3B FILED ON 15- 05-2023 Exhibit P13 A COPY OF THE RETURN FOR THE MONTH OF OCTOBER, 2022 IN GSTR-3B FILED ON 17-05- 2023