M/S Hari Om Enterprises vs. Principal Commissioner Of Department Of Trade And Taxes, Government Of Nct Of Delhi
Original PDF →Facts
The petitioner, M/s Hari Om Enterprises, held a GST registration since December 29, 2021, for trading in polymers. On September 18, 2022, the petitioner applied for cancellation of this registration, stating business closure from that date. The department took no action for over a year. On February 19, 2024, the respondent issued a notice stating the cancellation date provided in the application was incorrect and required the petitioner to enter the correct date. The petitioner responded, clarifying the cancellation date sought was September 18, 2023. The department again took no further action. The petitioner then filed a writ petition seeking a direction for the cancellation of their GST registration.
Held
The Court held that the respondent authority had unreasonably delayed the disposal of the petitioner's application for cancellation of GST registration. The petitioner had applied for cancellation on September 18, 2022, and despite a notice being issued on February 19, 2024, and a subsequent reply from the petitioner clarifying the date as September 18, 2023, no final action was taken. The Court found this delay unacceptable. The ratio decidendi is that statutory authorities must act expeditiously on applications filed by taxpayers, especially concerning the cancellation of registrations, and inordinate delays are not permissible. The Court directed the Proper Officer to dispose of the application seeking cancellation of GST registration expeditiously within a period of four weeks from the date of the order. The Court explicitly stated that it had neither considered nor commented upon the merits of the contentions of either party, reserving all rights and contentions.
Key Issues
1. Whether the respondent authority has unreasonably delayed the disposal of the petitioner's application for cancellation of GST registration, thereby violating principles of natural justice and statutory timelines? (Mixed question of law and fact, concerning the interpretation and application of relevant GST provisions and administrative efficiency). Petitioner's Contention: The petitioner argued that the respondent authority failed to act on their application for GST registration cancellation for an inordinate period, first from September 18, 2022, to February 19, 2024, and then again after the petitioner's reply to the notice dated February 19, 2024. This delay constitutes a failure to perform their statutory duty and causes prejudice to the petitioner. Respondent's Contention: The respondent did not record any specific arguments against the petitioner's claim of delay. Their action of issuing a notice on February 19, 2024, suggests they identified an issue with the application, which the petitioner claims to have rectified.
Sections Cited
Central Goods and Services Act, 2017
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Cause title — parties, addresses and appearances
JUDGMENT SANJEEV SACHDEVA, J. (ORAL)
Petitioner seeks a direction to the respondent to cancel GST registration.
Issue notice. Notice is accepted by learned counsel appearing for respondent. With the consent of the parties, petition is taken up for final disposal today. W.P. (C) 6249/2024 3. Petitioner was engaged in the business of trading in polymers and possessed a GST registration under the Central Goods and Services Act, 2017 (hereinafter referred to as the Act) since 29.12.2021. 4. As per the petitioner, petitioner submitted an application dated 18.09.2022 seeking cancellation of the GST Registration on the ground of closure of business w.e.f. 18.09.2022. 5. Between 18.09.2022 till 19.02.2024, no action was taken by the department. Thereafter, notice dated 19.02.2024 was issued to the petitioner on the ground “Cancellation Details - Date from which registration is to be cancelled - Date from Registration to be cancelled is Incorrect. Enter correct date”. Said notice was issued stating that the Petitioners application seeking cancellation of GST registration was not in order as the date from which registration was sought to be cancelled was incorrect and the petitioner was required to give a correct date from which registration was to be cancelled.
Petitioner replied to the said notice and stated that the date from which registration is sought to be cancelled is 18.09.2023. Once again no steps have been taken by the department.
Since petitioner has already replied to the notice issued by the department and has requested for cancellation of GST registration W.P. (C) 6249/2024 w.e.f. 18.09.2023, this petition is disposed of directing the Proper Officer to dispose of the application seeking cancellation of GST registration expeditiously within a period of four weeks from today.
It is clarified that this Court has neither considered nor commented upon the merits of the contentions of either party. All rights and contentions of parties are reserved.
Petition is disposed of in the above terms. SANJEEV SACHDEVA, J RAVINDER DUDEJA, J MAY 03, 2024/sk
Reproduced from the public record of the Delhi High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.