K Kumar Raja Projects PVT LTD vs. Assistant Commissioner Of State Tax Durgapur Circle State Goods And Service Tax And Ors

Facts

The appellant, K. Kumar Raja Projects Pvt. Ltd., challenged an order dated 8.11.2019 by the Assistant Commissioner of State Tax, Durgapur Circle, cancelling its GST registration. The appellant argued it is a company engaged in infrastructure projects with PAN India presence and had commenced business in West Bengal after obtaining registration. A show cause notice dated 18.11.2019 was issued for cancellation of registration due to being non-functioning/non-existing at the place of business, to which the appellant did not respond. Consequently, registration was cancelled on the same date. An application for revocation of cancellation filed on 8.2.2022 was also rejected on the same day. The appellant filed an intra-court appeal against the order of the writ court which had not granted interim relief and directed filing of affidavits.

Held

The Court held that the authority committed a grave error in rejecting the application for revocation of cancellation of registration. The rejection of the application for revocation of cancellation of registration was found to be in total violation of the principles of natural justice and arbitrary. The Court was satisfied that the transactions referred to in the order dated 18.08.2020 prima facie showed that the appellant was carrying on business within the State of West Bengal. The Court set aside the order dated 8.2.2022 rejecting the revocation application and restored the application to the file of the concerned authority. The appellant was directed to appear before the authority with all records to prove its business operations in West Bengal. The authority was directed to afford a personal hearing and decide the matter on merit, uninfluenced by the order dated 18.08.2020. The authority was to issue notice to the appellant within two weeks.

Key Issues

1. Whether the order rejecting the application for revocation of cancellation of registration, dated 8.2.2022, is in violation of the principles of natural justice and arbitrary, as argued by the appellant. The appellant contended that the rejection was done on the same day the application was filed without proper consideration. The revenue did not file an affidavit-in-opposition within the stipulated time. 2. Whether the appellant is a functioning dealer carrying on business within the State of West Bengal, as prima facie indicated by the transactions referred to in the order dated 18.08.2020, which the appellant argued supports its case. The appellant relied on its business activities with the Airport Authority of India and its PAN India presence. The revenue's contentions were not explicitly recorded in the judgment.