Sarda Eco Power LTD. vs. The State Of Assam And 3 Ors
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The petitioner, Sarda Eco Power Ltd., is a registered assessee under the CGST Act, 2017 and AGST Act, 2017. Its GST registration was cancelled on December 14, 2023, due to non-submission of returns. A show cause notice dated November 13, 2023, was issued by Deputy Commissioner of Taxes, Guwahati Zone-C, citing non-filing of returns for six continuous months, and suspending the registration from November 13, 2023. The petitioner claims it was not conversant with the GST online portal and was not granted an opportunity of hearing. It also states that the period of default was not mentioned in the show cause notice. Consequently, the petitioner could not file an application for revocation of cancellation within the prescribed 30 days due to lapse of time.
Held
The Court held that the order of cancellation of registration dated December 14, 2023, was liable to be set aside and quashed. The Court found that similar issues had been dealt with in the case of Motaleb Bhuyan Vs. The State Of Assam And Ors, 2025 SCC OnLine SC 1429. Following the directions in that precedent, the Court directed the petitioner to file all pending returns from the date of default until the present date within 30 days of the order. The petitioner was also directed to pay arrears of tax, penalty, interest, and late fees. The period stipulated in Section 73(10) of the CGST Act, 2017, for computation of penalties and interest was to be calculated from the date of the instant judgment, with an exception for the financial year 2025-26, which would be governed by Section 44 of the CGST Act, 2017. The ratio decidendi is that cancellation of registration without a proper opportunity of hearing and in the absence of clear communication in the show cause notice may be set aside, with directions for compliance and payment of dues.
Key Issues
1. Whether the cancellation of GST registration was valid without providing an adequate opportunity of hearing to the petitioner, as required by principles of natural justice, and in light of the alleged lack of clarity in the show cause notice regarding the period of default? (Question of mixed law and fact, turning on Section 29 of the CGST Act, 2017 and principles of natural justice). Petitioner's Arguments: - The petitioner was not granted an opportunity of hearing before cancellation of its registration. - The show cause notice lacked clarity regarding the specific period of default for non-filing of returns. - The petitioner was unaware of the GST online portal's intricacies, leading to the inability to file returns and subsequently, the revocation application within the stipulated time. Revenue's Arguments: - The judgment records no specific arguments from the respondents regarding the validity of the cancellation or the opportunity of hearing. The Addl. AG, Assam, appeared for the respondents.
Sections Cited
Section 29, Section 30, Section 39, Section 73(10), Section 44
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Cause title — parties, addresses and appearances
Operative Part of the Judgment
Whether the Full Judgment has been : Yes Pronounced
JUDGMENT & ORDER(ORAL)
Page No.# 3/5 Heard Mr. GN Sahewalla, the learned Senior Advocate, assisted by Mr. M Sahewalla, the learned counsel appearing on behalf of the petitioner. I have also heard Mr. B Gogoi, the learned Addl. AG, Assam for the respondents.
The petitioner herein is aggrieved by the cancellation of its registration in terms with Section 29 of the Central Goods and Service Tax Act, 2017 (for short, ‘the CGST Act of 2017’). It is the case of the petitioner that the petitioner could not file any application seeking revocation of the cancellation of the registration, within 30 days as prescribed under Section 30 of the Assam Goods and Service Tax Act, 2017. It is under such circumstances the petitioner has, therefore, approached this Court by filing the instant writ petition seeking restoration of its GST registration.
The materials on record reveal that the petitioner herein is a Company registered under the Companies Act, 1956 and is engaged in the business of providing Electrical Contractors Services and Electricians Services and is represented by its Director Shri Churukanti Ashok Reddy is a registered Assessee under the Central Goods and Service Tax Act, 2017 (for short, ‘CGST Act of 2017’)/Assam Goods & Services Tax Act, 2017 (for short, ‘the AGST Act of 2017). The petitioner has obtained a registration under the CGST Act of 2017 and was provided with the Unique ID bearing GST Registration No.18AALCS1964RIZE.
On account of non-submission of the returns, which is required in terms with Section 39 of the CGST Act of 2017 (which the petitioner does not deny in the instant petition), a show cause notice was issued on 13.11.2023 asking the petitioner as to why his registration should not be cancelled. In addition to that, it was also mentioned that his registration shall stand suspended from 13.11.2023. Page No.# 4/5
Mr. GN Sahewala, the learned Senior counsel appearing on behalf of the with the following observations and directions: (i). The order of cancellation of registration dated 14.12.2023 is set aside and quashed. (ii). The petitioner herein is directed to file the returns for the period
Page No.# 5/5 from the date the petitioner had failed to file the returns till date, within 30 days from the date of the instant order. (iii). The period as stipulated in Section 73(10) of the CGST Act of 2017 shall be computed from the date of the instant judgment, except for the financial year 2025-26, which shall be as per Section 44 of the CGST Act of 2017. (iv). The petitioner herein also shall be liable to make payment of the arrears i.e. tax, penalty, interest and late fees.
With the above, the instant writ petition stands disposed of.
JUDGE Comparing Assistant
Reproduced from the public record of the Gauhati High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.