M/S Vishal Enterprises vs. Principal Commissioner Of Goods And Service Tax West Delhi
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The petitioner, M/s Vishal Enterprises, filed a writ petition challenging a Show Cause Notice (SCN) dated January 12, 2024, issued by the Principal Commissioner of Goods and Service Tax, West Delhi. The SCN alleged a violation of Section 29(2)(e) of the Central Goods and Services Tax Act, 2017, specifically that the GST registration was obtained by fraud, wilful misstatement, or suppression of facts. However, prior to the SCN, the petitioner had voluntarily applied for cancellation of its registration on January 6, 2023. In response to this application, the respondent issued a notice on January 17, 2023, stating that the party was found non-existing during physical verification and requiring a reply by January 25, 2023. The petitioner failed to respond to this notice.
Held
The Court held that there were no grounds to quash the impugned Show Cause Notice (SCN) as prayed for by the petitioner. The reasoning was based on the conceded failure of the writ petitioner to respond to the notice dated January 17, 2023, which was issued in connection with the petitioner's own application for cancellation of registration. The Court noted that this failure led to the rejection of the cancellation application and the subsequent issuance of the SCN. The Court explicitly left it open for the petitioner to file its reply to the notice dated January 17, 2023. The SCN proceedings are to be disposed of by the respondents in accordance with law and with due expedition. All rights and contentions of the respective parties on merits were kept open.
Key Issues
1. Whether the Show Cause Notice dated January 12, 2024, alleging violation of Section 29(2)(e) of the CGST Act, 2017, is valid, considering the petitioner's prior application for cancellation of registration and subsequent failure to respond to a notice dated January 17, 2023. Petitioner's contention: The petitioner sought to impugn the validity of the SCN. While not explicitly stated, the implication is that the SCN should not have been issued or should be quashed given the prior cancellation application. Respondent's contention: The respondent issued the SCN based on the petitioner's failure to respond to the notice dated January 17, 2023, which was issued in relation to the petitioner's own application for cancellation of registration. The respondent's argument hinges on the petitioner's non-compliance with the notice seeking clarification.
Sections Cited
Section 29(2)(e)
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Cause title — parties, addresses and appearances
O R D E R
Allowed, subject to all just exceptions. CM APPL. 64015/2024 (Ex.)
Application stands disposed of.
The writ petitioner seeks to impugn the validity of a Show Cause Notice W.P.(C) 15243/2024 1 dated 12 January 2024 which has come to be issued by the respondents alleging a violation of Section 29(2)(e) of the Central Goods and Services Tax Act, 20172
The record, however, would bear out that prior to the issuance . The allegation as levelled essentially is that the registration under the CGST Act had been obtained by means of fraud, wilful misstatement or the suppression of facts.
1 SCN 2 CGST Act This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 03/07/2025 at 10:06:19
of that SCN, the petitioners had on 06 January 2023 voluntarily moved an application seeking cancellation of its registration.
In connection with that application, the respondents had issued a notice on 17 January 2023 and which reads as follows: “Form GST REG-03 [See Rule 9(2)] Reference Number: ZA0701231015247 Date: 17/01/2023 To VISHAL LAKRA GROUND FLOOR, 263, NANGLOI, VILLAGE RANHOLLA, NANGLOI, NEW DELHI, West Delhi, Delhi, 110041 GSTIN (if available): 07AQRPL6150FIZN Application Reference No. (ARN): AA070123017616K Date: 06/01/2023 Notice for Seeking Additional Information / Clarification / Documents relating to Application for Cancellation This is with reference to your Cancellation application filed vide ARN AA070123017616K Dated - 06/01/2023 The Department has examined your application and is not satisfied with it for the following reasons: 1 Cancellation Details - Others (Please specify) - The party was found non-existing during physical verification. You are directed to submit your reply by 25/01/2023 If no response is received by the stipulated date, your application is liable for rejection. Please note that no further notice / reminder will be issued in this matter.”
Undisputedly, the petitioner failed to respond to that notice or furnish any documentation to meet the objection which had been raised. It was a failure on that score which ultimately resulted in the rejection of its application for cancellation and the issuance of the This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 03/07/2025 at 10:06:19
SCN of even date.
In view of the aforesaid, and in light of the conceded failure on the part of the writ petitioner to respond to the notice dated 17 January 2023, we find no ground to quash the impugned SCN as prayed for.
We, however, leave it open to the petitioner to file its reply to that notice. The SCN proceedings may, consequently, be disposed of by the respondents in accordance with law and with due expedition.
All rights and contentions of respective parties on merits are kept open.
YASHWANT VARMA, J.
RAVINDER DUDEJA, J. OCTOBER 29, 2024/RW
This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 03/07/2025 at 10:06:19
Reproduced from the public record of the Delhi High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.