M/S R.R. Projects vs. The Superintendent

WP/45157/2022HC TelanganaGSTCNR HBHC01068945202215 June 2023Bench: N.TUKARAMJI,UJJAL BHUYAN7 pages

For Petitioner: SRl. SHAIK JEELANI BASHA FOR SRt. BHASKAR, REDDY VEMIREDDYFor Respondent: SRl. L. VENKATESWAR RAO, SC FOR, COMMERCIAL TAXES

AI SummaryRemanded

Facts

The petitioner, M/s R.R. Projects, a registered taxable person under the CGST Act, 2017, filed a writ petition challenging the order dated 29.11.2021 passed by the Superintendent, GST Range, Hyderabad, cancelling its GST registration. The cancellation was based on the ground of non-filing of GST returns for a continuous period of six months. The petitioner submitted that it could not file a reply to the show cause notice for various reasons. The impugned order stated that the petitioner had submitted a reply on 27.11.2021, but then proceeded to cancel the registration for non-response to the show cause notice, indicating a contradiction. The petitioner also sought condonation of delay in filing the writ petition, which was granted by the Court.

Held

The Court held that the impugned order dated 29.11.2021, cancelling the GST registration of the petitioner, suffered from serious contradictions. The order stated that the petitioner had submitted a reply to the show cause notice, but then proceeded to cancel the registration on the ground of non-response to the show cause notice. This inconsistency indicated that the first respondent had not applied his mind to the matter and had mechanically passed the order. Consequently, the Court set aside the impugned order. The matter was remanded back to the first respondent for passing a fresh order in accordance with the law. The petitioner was granted liberty to submit its reply within 15 days from the date of the order, after which the respondent was to pass an appropriate order after providing due opportunity of hearing. The petitioner was also permitted to submit the pending returns along with the tax due. No issue was expressly left undecided.

Key Issues

1. Whether the order dated 29.11.2021 passed by the first respondent cancelling the GST registration of the petitioner is illegal, arbitrary, and without jurisdiction, in violation of the principles of natural justice and constitutional provisions? (Mixed question of law and fact, concerning Section 29 of the CGST Act, 2017 and principles of natural justice). Petitioner's Contention: The petitioner argued that the impugned order suffers from serious contradictions, as it acknowledges receipt of a reply but simultaneously states non-response to the show cause notice. This indicates a mechanical application of mind by the respondent, violating principles of natural justice. The petitioner also contended that the cancellation was illegal and arbitrary. Respondents' Contention: The judgment does not record any specific arguments made by the respondents. However, their presence and representation indicate a defence against the petitioner's claims.

Sections Cited

Section 29

AI-generated summary — verify with the full judgment below

Cause title — parties, addresses and appearances

[ 3311 ] HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD (Special Original Jurisdiction) THURSDAY, THE FIFTEENTH DAY OF JUNE TWO THOUSAND AND TWENTY THREE PRESENT THE HONOURABLE THE CHIEF JUSTICE UJJAL BHUYAN AND THE HONOURABLE SRI JUSTICE N.TUKARAMJI WRlT PETITION NO: 45157 OF 2022 Between: AND 1. 2. 3. M/s R.R. Projects, Plot No.25, H.NO.114125, Sai Enclave, Sriram RTC Colonv, Par6vathapur, Peerzadiguda, Medchel Mandal, Malkajgiri' Telanlana. Rep. by its Proprietor Mr. Thumma Thomas Reddy ...PETITIONER The Superintendent, Tamaka- 1 Circle, Secunderabad GST Range' Secunderabad GST Division, Hyderabad. The Commissioner of State Tax, Government of Telangana, Hyderabad. State of Telangana, Rep. by its Principal Secretary (Revenue[CT) Department, Secretariat Buildings, Hyderabad. ...RESPONDENTS Petition under Article 226 ot lhe Constitution of lndia praying that in the circumstances stated in the affidavit filed therewith, the High Court may be pleased to issue Mandamus or any other appropriate writ or order or direction by declaring the action of the 1st respondent in cancelling the GST registration of the petitioner through the impugned proceedings in Form GST REG 19 dated 29-11- 2021 and not re-storing the same even after filing all the pending returns and payment of tax as illegal, arbitrary, high handed, without authority of law and jurisdiction, vitiated on account of violation of principles of natural justice and also in violation of Article 19 and 21 of the Constitution of lndia and consequently set aside the impugned proceedings of the lst respondent dated 29- 11-2021 ' lA NO: 1 OF 2022 Petition under Section 151 CPC praying that in the circumstances stated in the affidavit filed in suppo( of the petition, the High Court may be pleased To suspend the operation of the impugned proceedings of the 1st respondent in Form GST REG 19 dated 29-11-2021 pending disposal of the writ petition. Counsel for the Petitioner: SRl. SHAIK JEELANI BASHA FOR SRt. BHASKAR REDDY VEMIREDDY Counsel for the Respondents: SRl. L. VENKATESWAR RAO, SC FOR COMMERCIAL TAXES

/ THE HON'BLE THE CHIEF JUSTICE UJJAI BHIryAN AND THE HON'BLE SRI JUSTICE N.TT'I(ARAMJI Writ Petition No.45157 of 2022 ORDER: Per the Ho4'bte the Chtef Justice ujjal Bhugan) Heard Mr.Shaik Jeelani Basha, learned counsel appea-ring on behalf of Mr.Bhaskar Reddy, learned counsel for the petitioner and Mr.L.Venkateswar Rao, learned Standing counsel for Commercial Taxes appeadng on behalf of the respondents.

By filing this petition under Article 226 of Constitution of India, petitioner has assailed legality and validity of the order dated 29.77.2021 passed by the first respondent carcelling the Goods and Services Tax (GST) registration of the petitioner.

On 19.12.2022, this Court had granted libert5r to the petiiioner to file a better affidavit explaining the delay in Eling the writ petition. Thereafter, petitioner has filed a better affidavit. On perusal of the averments made in the 2 \rc \'l better affidavit, more particularly those made in paragraph No.3 thereof, we are satisfied that the delay in filing the u,rit petition r.r'as caused b1'good and sufficient reasons'

Be it stated that petitioner was a registered taxable person bearing registration No'36AAOFR4364CLZ3 .under Centra,l Goods ald Services Tax Act, 2017 (briefly 'CGST Act' hereinafter). First respondent issued show cause notice dated 17 .l I .2021 calling upon the petitioner to show cause as to why its GST registration should not be cancelled on the ground of non-filing of GST returns for a continuous period of six (6) months'

It is submitted that for various reasons petitioner could not file reply to the show cause notice' whereafter impugned order came to be Passed'

A perusal of the impugned order dated 29'1'I'2021 would go to show that first respondent had recorded that in reference to his show cause dated 17 'll '2021 ' petitioner . had submitted reply on 27'll'2o21' Thereafter' first \ --\

/ .) respondent stated that he had examined the reply of petitioner but registration of petitioner was liable to be cancelled on the ground that petitioner had not responded to the show cause notice. From the above, it is evident that the impugned order suffers from serious contradictions. On the one hand frrst respondent says that petitioner had submitted reply but on the other hand he says that GST registration of tlle petitioner was liable to be cancelled for not filing reply. It only shows that first respondent had not applied his mind at all and had mechanically passed the impugned order dated 29.11.2021

We therefore set aside the order dated 29.77.2021 and remand the matter back to the first respondent for passing fresh order in accordance with law.

It would be open to the petitioner to submit his reply within a period of 15 days from today whereafter respondent No. 1 shall pass appropriate order in accordance with law after giving due opportunity of hearing to the petitioner. We further make it clear that it would be I , ..I {4'gii.+ .24"..-f \

+ open to the petitioner to submit the returns along with the tax due. To, 1 2 3 TJ GJP

This disposes of the writ petition' . Two CD CoPies Miscelianeous applications pending' if any' shall stand closed. However, there shall be no order as to costs' //rRUE coPY// .f"+,r* oFFlcER 3ffi 33133J:I\,1.Ifj.3s*3IJfI'5.3?J;3".#",T13'lPiJSltoPUC] \ k-

tI I HIGH COURT DATED:1 510612023 ORDER WP.No.45157 of 2022 DISPOSING OF THE WRIT PETITION WITHOUT COSTS. -1H TA fS S \- t-. .-1 -'-- .'I -:, ,,1 ).),' ..)' d to lrrrlsn ! I

Reproduced from the public record of the Telangana High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.