Nitu Sinha vs. The State Of Bihar

Facts

The petitioner, Nitu Sinha, is challenging the order dated July 29, 2022, which cancelled her GST registration. She filed an appeal against this order, but it was rejected due to delay. The petitioner argues that the cancellation order is non-speaking and lacks reasons. The State contended that the Assessing Officer used form GST REG-19. The Court noted that form GST REG-19 has a specific column for reasons, which was not filled. The Court also referred to a previous judgment in Manoj Kumar Sah versus The State of Bihar and Anr. which highlighted similar illegality in non-speaking orders of cancellation. The Court observed that the cancellation was effected for reasons under clause (b) or (c) of Sub-section (2) of Section 29 of the Bihar Goods and Services Tax Act, and a notification provided an extended period to apply for revocation of cancellation under certain conditions.

Held

The Court held that the order cancelling the petitioner's GST registration (Annexure-1 dated July 29, 2022) is a non-speaking order and suffers from illegality, violating the principles of natural justice. The Court found that the order did not state any reasons for the cancellation and did not even refer to the subject of the notice. This aligns with the illegality pointed out in the case of Manoj Kumar Sah versus The State of Bihar and Anr., where a non-speaking and cryptic order leading to penal and pecuniary consequences was quashed. The Court set aside the impugned order and directed reconsideration of the issue. Additionally, the Court noted Notification No. 3 of 2023, which allows for revocation of cancellation under certain conditions if the cancellation was for failure to file returns under Section 29(2)(b) or (c), provided returns are filed up to the effective date of cancellation and all dues are paid. The writ petition was allowed, and the matter was remanded for fresh consideration.

Key Issues

1. Whether the order cancelling the petitioner's GST registration, Annexure-1 dated July 29, 2022, is a non-speaking order and thus violates principles of natural justice, specifically concerning Section 29(2) of the Bihar Goods and Services Tax Act, 2017? Petitioner's Arguments: The petitioner argued that the order of cancellation of registration is non-speaking, meaning it does not provide any reasons for the decision. This lack of reasoning violates the principles of natural justice, rendering the order illegal. The petitioner relied on the judgment in Manoj Kumar Sah versus The State of Bihar and Anr. to support the contention that non-speaking orders that entail civil and penal consequences are liable to be quashed. Revenue's Arguments: The State contended that the Assessing Officer adopted form GST REG-19. The Court noted that the Assessing Officer appeared to believe that if the assessee did not appear or file an objection, no reasons needed to be assigned. The State did not present any argument against the petitioner's claim that the order was non-speaking or that it violated principles of natural justice.