Jai Bahadur Singh vs. State Of U.P. Thru. Addl. Chief Secy./Prin. Secy. Dept. Of Commercial Tax Lko. And 2 Others
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The petitioner, Jai Bahadur Singh, proprietor of a civil work contract firm registered under GST, challenges an order dated 22.12.2022 by respondent no.1, which dismissed his appeal against the cancellation of his GST registration. The cancellation order, dated 16.09.2019, was passed after a show cause notice dated 19.08.2019 was issued. The petitioner claims he did not receive the show cause notice and thus could not file a reply within the stipulated seven working days. His appeal against the cancellation was dismissed by the appellate authority solely on the ground of delay.
Held
The Court allowed the petition, setting aside both the order of cancellation of registration dated 16.09.2019 and the appellate order dated 22.12.2022. The Court reasoned that the order cancelling registration, passed solely on the ground of non-submission of a reply to the show cause notice without providing an adequate opportunity to be heard, is unsustainable. This aligns with the principle laid down in the cited case of Technosum India Pvt. Ltd. Lucknow, which held that such orders are non-speaking and do not stand the test of scrutiny under Article 14 of the Constitution. The ratio decidendi is that a GST registration cannot be cancelled merely for non-filing of a reply to a show cause notice if the notice was not effectively served or if the petitioner was not afforded a proper hearing. The petitioner was permitted to appear before the respondent within three weeks with a reply to the show cause notice and a copy of this order and the Technosum India judgment, after which the respondent is to pass a fresh order in accordance with law.
Key Issues
1. Whether the order cancelling the petitioner's GST registration, passed without providing an opportunity to be heard or considering a reply to the show cause notice, is sustainable in law, specifically in light of the principles of natural justice and Article 14 of the Constitution of India? 2. Whether the petitioner is entitled to the benefit of the judgment in Writ Tax No.145 of 2022 (Technosum India Pvt. Ltd. Lucknow Vs. Union of India and others) dated 26.09.2022, which held that non-submission of a reply to a show cause notice cannot be the sole ground for cancellation of registration? Petitioner's arguments: The petitioner contends that the order cancelling his registration was passed without affording him a hearing, as he never received the show cause notice. He argues that the non-submission of a reply cannot be the sole basis for cancellation, citing the precedent set in Technosum India Pvt. Ltd. Lucknow. He asserts he is entitled to the same relief granted in that case. Revenue's arguments: The learned Standing Counsel for the State did not record any specific arguments against the petitioner's claims.
Sections Cited
Section 14, Section 29, Section 107
AI-generated summary — verify with the full judgment below
Court No. - 4 Case :- WRIT TAX No. - 20 of 2023 Petitioner :- Jai Bahadur Singh Respondent :- State Of U.P. Thru. Addl. Chief Secy./Prin. Secy. Dept. Of Commercial Tax Lko. And 2 Others Counsel for Petitioner :- Shachindra Pratap Singh,Neeraj Kumar Rai Counsel for Respondent :- C.S.C. Hon'ble Vivek Chaudhary,J. not given. The non-submission of reply to the show cause cannot be a ground for cancellation of the registration. The relevant Paragraphs 9 and 10, of the judgment in Technosum India Pvt. Ltd. Lucknow (Supra), read as under:- "
The Counsel for the petitioner argues that the appeal has been dismissed as being beyond limitation as such the doctrine of merger would not apply and the petitioner is fair entitled to seek judicial review of the order dated 03.01.2022 on the ground that the same is non speaking order. This Court while deciding Writ Tax No.147 of 2022 (M/S Chandrasen,
Thus, following the said judgment rendered in the case of M/s Chandrasen (Supra), the writ petition deserves to be allowed." Order Date :- 24.1.2023 Arti/- [Vivek Chaudhary,J.] ARTI MAURYA High Court of Judicature at Allahabad, Lucknow Bench
Reproduced from the public record of the Allahabad High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.