M/S.Nidamarti Raj Tarun vs. Superintendent Of Central Tax
Original PDF →Facts
The petitioner, M/s. Nidamarti Raj Tarun, a proprietorship concern engaged in movie making, had its GST registration cancelled by the Superintendent of Central Tax (first respondent) via an order dated 29.12.2020. The petitioner claims it did not receive the show cause notice dated 16.12.2020, which purportedly led to the cancellation. The petitioner's subsequent appeal against this cancellation was rejected by the Additional Commissioner Appeals (second respondent) through an order-in-appeal dated 12.01.2023. The petitioner filed a writ petition before the High Court challenging both the cancellation order and the appellate order, seeking to set them aside as arbitrary and illegal.
Held
The Court held that both the order of cancellation of GST registration dated 29.12.2020 passed by the first respondent and the order-in-appeal dated 12.01.2023 passed by the second respondent suffered from a total non-application of mind. Citing the precedent of M/s. Chenna Krishnama Charyulu Karampudi v. Additional Commissioner Appeals, the Court noted that the GST Tribunal had not yet been constituted, leaving the petitioner without an alternative remedy. In that precedent, the High Court had remanded the matter back to the appellate authority for reconsideration. Following this, the Telangana High Court set aside both impugned orders. The matter was remanded back to the file of the first respondent for passing a fresh order in accordance with law, after granting the petitioner due opportunity of hearing. The Court directed that the petitioner shall submit all returns as per the statute when the matter is heard on remand. The writ petition was allowed.
Key Issues
1. Whether the cancellation of GST registration by the first respondent, without providing the petitioner with a satisfactory opportunity to show cause, is legally sustainable, particularly in light of the petitioner's claim of not receiving the show cause notice? (Question of mixed law and fact, concerning principles of natural justice and procedural compliance under GST law). 2. Whether the appellate authority's rejection of the petitioner's appeal, upholding the cancellation order, suffers from non-application of mind and is therefore liable to be set aside? (Question of law, concerning the scope of appellate review and judicial scrutiny of administrative orders). Petitioner's arguments: The petitioner argued that it did not receive the show cause notice dated 16.12.2020, and therefore, its reply dated 25.12.2020 was not considered by the first respondent. The petitioner contended that both the cancellation order and the appellate order demonstrate a total non-application of mind by the respondents. Respondents' arguments: The judgment does not record any specific arguments made by the respondents. However, their actions, as reflected in the orders under challenge, indicate an assertion of the validity of the cancellation and the appellate decision.
Sections Cited
Section 107, Section 109, Section 112
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Cause title — parties, addresses and appearances
I he Court made the following: ORDER
THE HON'BLE THE CHIEF JUSTICE UJJAL BHIIYAN AND THE HON'BLE SRI JUSTICE N. TUKARAMJI WRIT PETITIoN No.6979 of 2o23 ORDER: (Per the llon'bte the ChieJ'Justice ujjal Bhugan) Heard Ms. S.Aruna Sri, learned counsel representing Mr. S.Suri Babu, learned courlsel for the petitioner and Ms. B.Sapna Reddv, lcarned counsel lor the respondents.
This petitiorr has been filed under Article 226 of the Constitution of lndia assailing the legality and validity of the order dated 29.12.2O2O passed by the l"t respondent as well as the order-in-appeal dated 12.01.2023 passed by the 2.d respondent
By the first order dated 29.12.2020, the Goods and Services Tax (GST) registration of the petitioner has been cancelled. Appeal filed by the petitioner against the aforesaid order of cancellation has been rejected by the 2"d respondent uidg the order-in-rrppeal dated 12.O1.2023. LIC] & N1'RJ W.P. No.6979 of 2C23
Petitioner before us is a proprietorship concern engaged in the business of movie making. After enactment of the GST laws, petitioner got itself registered with the GST authorities bearing registration No.36ASYPT3562El23' Show cause notice dated 16 .12.2020 was issued by the I "t respondent to the petitioner to show cause as to why GST registration of the petitioner should not be cancelled. Order dated 29. 12.2O2O records that reply of the petitioner dated 25.12.2020 $,as not found satisfactory and accordingly, the GST registration was cancelled. 5. l,earned counsel for the petitioner submits that petitioner did not receive the show cause notice dated 16.12.2O2O and therefore did not submit reply dated 25.12.2020 as stated by the l"t respondent.
As a matter of fact, on going through the order dated 29.12.2020, we do not find any reason being mentioned by the l"t respondent for cancellation of GST registration of the petitioner. 2 \
3 HC) & N7:RJ \U. P. No.6979 of 2023
Be that as it m:r-\', against such cancellation of registration, petitioner prelerred appeal before the 2"d respondent. Howerre r. hv the order-in-appeal dated 12.01.2023, 2,d respondent rejected the appeal by upholding the order passcd by the I't respondent
On going thror-Lgh both the orders dated 29.12.2020 and 12.01.2023. ue are of the vieu' that there appears to be total rlotr-appliczttion of mind on the part of the said responclents u'hile passrltg the tu'o impugned orders. g. In any view of the matter, issue raised in this writ petition is no longer res inteqra
In M/s. Chenna Krishnama Charyulu Karampudi v. Additional Commissioner Appealsr, a division bench of this Court held as follows '
On a query by the Court as to why petitioner has not approached the Goods and Services Tax Tribunal (GST Tribunal) under section 112 ol'the Central Goods and Services Ta-x Act, 2Ol7 lbriefly,'CGST Act'hereinafter), learned counsel I t (2022) I42 taxmann.com 70 (Telangar-ra) I \
- 4 I!(i & i\rTR,l W.P.i\o.697c) oi 2023 for the petitioner srrbmits that till rlate no GST Tribunal has been constitu tt:d
We have perused thc order dated l9-4-2O22 This is an order passed by rhe hrst appellate authority under secLion 107(i) of the CGST Act. As per sub-section (1) of section 107 of the CGST Act, Iimitation for hling appeal is three months from the date of communication of the order appealed agalnst' Under sub-section (4) of section 107 of the CGST Act' the appetlate authority may ailow the appeal to be presented wrthin a furthcr period of one month, provided sufficient cause is showrt b'; lhc iiPPcllant.
Though thc lo" cr appellate authority may be righl in holcling that rr'hilc ii m:rv allow filing oi an etppeal bcyond the limitation of thrce illonths for a further period of onc month' thcrc[ore, b'.' extci:sion of limitation beyond thc extcndcd pcricd oi one ri:tonth <lelay beyond thc extcnded period of one m-onth cannot bc condoned, we are of the view that such a stand taken by rcspondent No. l may adversely a-ffect the petiiioner. This is rnore so because respondent No' 2 had suo motu cancelled the GsT registration of the petitioner on the ground of non-ftling of returns and as GST Tribunal has not been constituted under section 109 of the CGST Act, petitioner would be left withoui anY remedY.
We further find that the issue pertains to cancellation of GST registration of the petitioner' In the facts and circumstances of the case, it would be just and proper if tJle entire matter is remanded back to respondent No' 2 to reconsider thc case of the petitioner and thereafter to pass appropriate order in accordance with law' I I
HCJ & NTRJ V,'.P.No.6979 of 2023 9, ln the light of the abovc :urd without cxpressing any opinion on merit, we remand thc mattcr back to the hle of respondent No.2 to consider the grievarce exprcssed by the petitioner against cancellation of GST regrstration arld thereaJter pass an appropriate order in accordance with law. Needless to say, when the respondent No.2 hcals the matter on remand, petitioner shall submit all tlle returns as per the statute. 10, Writ petition is accordingll disposed of " 1 1. Following the samc-, we set aslde both the orders dated 29.12.2020 ar-rd 12.O 12023 ancl remand the matter back to the file of the 1sL rcspondent lor passing a fresh order in accordance u'ith 1au/ after givir-rg due opportunity of hearing to the petitioner.
Writ Petition is accordingly allowed' However' there shall be no order as to costs.
Miscellaneous applications pending, if any, in this Writ Petition shall stand closed. P. PADMANABHA REDDY ASSISTANT REGISTRAR /ffRUE COPY// SECTI OFFICER II To,1. The Superintendent of Central Tax, Rajendra Nagar-1 , Saroor Nagar, Hyderabad, Telangana.
The Additional Commissioner Appeals - l, Office of the Commissioner of Customs and Central Tax, Appeals - 1, Hyderabad Commissionarate, 7th Floor, GST Bhavan, LB Stadium Road, Basheerbagh, Hyderabad - 500 004
One CC to SRl. S. SURI BABU, Advocate [OPUC]
One CC to M/S. BOKARO SAPNA REDDY, Advocate [OPUC]
Two CD copies BM GJP
HIGH COURT DATED:1410312023 ORDER WP.No.6979 of 2023 ALLOWING THE WRIT PETITION WITHOUT COSTS \u1 -_rr-_:. .t$' s\ ") i i i I I I I I I ! I I I i j
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.