M/S Ajay Traders vs. State Of Chhattisgarh

Held

The High Court held that the petitioner had invoked the extraordinary jurisdiction under Article 226 of the Constitution of India without first availing the alternative remedies provided under the State GST Act and Rules. Specifically, the Court noted that the petitioner could have filed an application for revocation of the cancellation of registration under Section 30 of the State GST Act, 2017, read with Rule 23 of the State GST Rules, 2017, or filed an appeal against the cancellation order under Section 107 of the State GST Act, 2017. Since these remedies were available and not pursued, the Court was not inclined to entertain the writ petition. The Court observed that if the petitioner files the appropriate application or appeal, it should be decided by the respondent authorities strictly in accordance with the law. The Court did not decide the merits of the petitioner's claims regarding the cancellation of registration or the rejection of the address change application.

Facts

The petitioner, M/s Ajay Traders, filed a writ petition challenging two orders passed by the Assistant Commissioner of State Tax, Raipur. The first order, dated March 24, 2025, rejected the petitioner's application for a change of address. The second order, dated May 26, 2025, cancelled the petitioner's GST registration retrospectively, citing that the business was not conducted from the declared place of business or that the place of business was not found. The petitioner contended that they conduct business from the registered address and that their change of address application was arbitrarily rejected without proper opportunity of hearing. The respondents argued that the cancellation was based on a negative spot verification report and that the petitioner had alternative remedies available.

Key Issues

1. Whether the GST registration of the petitioner was cancelled in violation of the SGST Act and Rules, specifically concerning the opportunity of hearing and the grounds for cancellation? 2. Whether the petitioner's application for change of address was arbitrarily rejected? The petitioner argued that their GST registration was cancelled without proper documentation of the inquiry and that they were not provided with an adequate opportunity of hearing. They also claimed their change of address application was arbitrarily rejected. The respondents contended that the cancellation was justified by a negative spot verification report and that the petitioner had not availed the alternative remedies of revocation of cancellation under Section 30 of the State GST Act, 2017 read with Rule 23 of the State GST Rules, 2017, or an appeal under Section 107 of the State GST Act, 2017, before directly approaching the High Court.