M/S Gogorra Consultants Private Limited vs. Union Of INDIA And Others

Held

The Court held that the impugned orders dated 08.05.2026 and 29.07.2026 are unsustainable because the very basis for their passing, which was the retrospective cancellation of the petitioner's supplier's registration, has ceased to exist. The appellate authority's order dated 06.07.2026, restoring the supplier's registration, fundamentally alters the factual matrix upon which the original and rectification orders were premised. The Court reasoned that a decision based on a premise that is later overturned cannot stand. Therefore, the orders impugned in the writ petition require reconsideration. The ratio decidendi is that if the factual basis for an adverse order is subsequently invalidated by a higher authority, the original adverse order must be reconsidered. The Court quashed the impugned orders and allowed the petition, remanding the matter to the adjudicating authority to reconsider it in light of the appellate order restoring the supplier's registration, after affording the petitioner an opportunity of hearing.

Facts

The petitioner, M/s Gogorra Consultants Private Limited, is challenging an order-in-original dated 08.05.2026 passed under Section 74A of the CGST/HGST Act, 2017, and a subsequent order dated 29.07.2026 that rejected their rectification application. The authorities directed the petitioner to reverse Input Tax Credit (ITC) primarily because the registration of their supplier was cancelled retrospectively. The petitioner argued that their transactions were bonafide. Crucially, an appellate authority, in an order dated 06.07.2026, had rejected the retrospective cancellation of the supplier's registration and directed its restoration. The petitioner contended that with the basis of the impugned action removed, the orders could not stand.

Key Issues

1. Whether the impugned orders, directing the reversal of ITC based on the retrospective cancellation of the petitioner's supplier's registration, are sustainable in light of the subsequent order restoring the supplier's registration? The petitioner argued that the very foundation of the impugned orders, namely the cancellation of the supplier's registration, has been nullified by the appellate authority's order restoring the registration. Therefore, the orders directing the reversal of ITC are no longer valid and cannot be sustained. The respondents, represented by the Additional Advocate General, Haryana, contended that the appellate authority's order came into existence subsequent to the impugned orders. They submitted that if given an opportunity, the authorities would re-examine the issue afresh in accordance with law.