Sing Traders vs. State Of Gujarat
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The petitioner, Sing Traders, a registered entity under the Gujarat Goods and Service Tax Act, 2017, filed a writ application challenging a show-cause notice dated 14.02.2022 and an ex-parte order dated 22.02.2022, both issued by the State Tax Officer, Ghatak-13, Ahmedabad. The show-cause notice, issued under Section 29 of the CGST Act, 2017 read with Rule 22(1) of the CGST Rules, 2017, cited 'DEALER FOUND SUSPICIOUS. NO DOCUMENTS FOUND AT THE PLACE OF BUSINESS' as the reason for potential cancellation of registration. The petitioner was directed to reply within seven working days and appear for a hearing on 21.02.2022. The order dated 22.02.2022 cancelled the registration ex-parte, stating no reply was submitted and the petitioner failed to appear for the hearing. The effective date of cancellation was stated as 11.01.2022, with no tax, interest, or penalty determined.
Held
The Court held that both the show-cause notice dated 14.02.2022 and the impugned order dated 22.02.2022 were vague and lacked material particulars. The Court found the show-cause notice to be "absolutely vague, bereft of any material particulars" and the impugned order to be "vague and a non-speaking order." Consequently, the Court quashed and set aside the order dated 22.02.2022. The matter was remitted to the respondent No.2 (State Tax Officer) for denovo proceedings in accordance with the law. As a result of quashing the cancellation order, the GST registration of the writ applicant was ordered to stand revived. The Court did not expressly leave any issue undecided.
Key Issues
1. Whether the show-cause notice dated 14.02.2022, issued under Section 29 of the CGST Act, 2017 read with Rule 22(1) of the CGST Rules, 2017, is vague and lacks material particulars, rendering it invalid? 2. Whether the ex-parte order dated 22.02.2022, passed by the State Tax Officer, Ghatak-13, Ahmedabad, cancelling the GST registration, is a non-speaking order and liable to be quashed? Petitioner's Arguments: The petitioner argued that the show-cause notice was vague and bereft of any material particulars. They contended that the subsequent order passed by the authority was also vague and a non-speaking order, failing to provide any reasoning for the cancellation. Therefore, both the notice and the order were liable to be set aside. Revenue's Arguments: The judgment records no specific arguments made by the respondents (State of Gujarat and its officers).
Sections Cited
Section 29, Rule 22(1)
AI-generated summary — verify with the full judgment below
Cause title — parties, addresses and appearances
ORAL ORDER (PER : HONOURABLE MS. JUSTICE NISHA M. THAKORE)
By this writ application under Article 226 of the Constitution of India, the writ applicant has prayed for the following reliefs: “(a) To issue a writ in the nature of certiorari and or any other appropriate writs, order or direction for calling of records of proceedings initiated pursuant to show-cause notice dated 14.02.2022 and after perusing the same be pleased to quash and set aside show cause notice dated 14.02.2022 and order dated 22.02.2022 passed thereon by State Tax Officer, Ghatak 13, Ahmedabad, and be further pleased to direct restoration of registration bearing number 24CDCPR3552B1ZX; (b) To pass an ex-parte ad interim order staying the operation, execution and implementation of the order dated 22.02.2022 bearing reference no. ZA240222104600G passed by State Tax Officer, Ghatak 13, Ahmedabad, pending the hearing and final disposal of present petition; and (c) Grant such further and other interim reliefs, as this Hon'ble Court may deem fit and proper in the present nature and circumstances of the case.” C/SCA/6315/2022 ORDER DATED: 06/04/2022
The brief facts, as emerges from the record, are summarized as under:
1 The writ applicant is registered under the Gujarat Goods and Service Tax Act, 2017 (for short ‘the Act, 2017). A show cause notice dated 14.02.2022 was issued by the State Tax Officer, Ghatak – 13, Ahmedabad, in Form GST REG-17/31 under Section 29 of the CGST Act, 2017 read with Rule 22(1) of the CGST Rules, 2017. The reason specified in the said show cause notice reads as under: “Show Cause Notice for Cancellation of Registration Whereas on the basis of information which has come to my notice, it appears that your registration is liable to be cancelled for the following reasons:
DEALER FOUND SUSPICIOUS. NO DOCUMENTS FOUND AT THE PLACE OF BUSINESS. You are hereby directed to furnish a reply to the notice within seven working days from the date of service of this notice. You are hereby directed to appear before the undersigned on 21/02/2022 at 11:00. If you fail to furnish a reply within the stipulated date or fail to appear for personal hearing on the appointed date and time, the case will be decided ex parte on the basis of available records and on merits. Please note that your registration stands suspended with effect from 14/02/2022.”
2 Pursuant to the show cause notice, the writ applicant was required to submit his reply within a period of seven days, failing which, the case was to be decided ex-parte. On 22.02.2022, the State Tax Officer, Ghatak-13, Ahmedabad, passed ex-parte order of cancellation of registration. The contents of the said order reads thus: “Order for Cancellation of Registration This has reference to your reply dated 21/02/2022 in response to the notice to show cause dated 14/02/2022 C/SCA/6315/2022 ORDER DATED: 06/04/2022 Whereas no reply to notice to show cause has been submitted; Whereas on the day fixed for hearing you did not appear, The effective date of cancellation of your registration is 11/01/2022 Determination of amount payable pursuant to cancellation: Accordingly, the amount payable by you and the computation and basis thereof is as follows: The amounts determined as being payable above are without prejudice to any amount that may be found to be payable you on submission of final return furnished by you. You are required to pay the following amounts on or before 04/03/2022 failing which the amount will be recovered in accordance with the provisions of the Act and rules made thereunder.” Head Central Tax State Tax/ UT Tax Integrated Tax Cess Tax 0 0 0 0 Interest 0 0 0 0 Penalty 0 0 0 0 Others 0 0 0 0 Total 0.0 0.0 0.0 0.0
We have heard Ms. Manvi Damle, the learned counsel appearing for the writ applicant and Mr. Utkarsh Sharma, the learned AGP appearing for the respondents.
On bare perusal of the the contents of the show cause notice as well as the impugned order, we find that the said show cause notice is absolutely vague, bereft of any material particulars and the impugned order is also vague and a non- speaking order. We quash and set aside the impugned order dated 22.02.2022 and remit the matter to the respondent No.2 for denovo proceedings in accordance with law. In view of the fact that we have quashed the order of cancellation of GST registration, the GST registration stands revived. C/SCA/6315/2022 ORDER DATED: 06/04/2022
With the aforesaid, this writ application stands disposed of. (J. B. PARDIWALA, J) (NISHA M. THAKORE,J) NEHA
Reproduced from the public record of the Gujarat High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.