R S Cattle Mills Th Jameel Choudhary vs. U T Of J And K Th Commissioner GST And State Taxes And Others

Facts

The petitioner, R S Cattle Mills, a registered firm under GST, failed to file GSTR-3B returns for its tax period(s) due to its firm being under installation and the impact of the COVID-19 pandemic. The respondent authorities, specifically State Taxes Circle-Q, Jammu, passed an order (No. ZA011019005252 dated 28.10.2019) cancelling the petitioner's GST registration. This cancellation was done without providing the petitioner an opportunity to be heard. The petitioner challenged this cancellation order through the present writ petition before the High Court.

Held

The Court, with the consent of both parties, disposed of the writ petition. The petitioner was granted liberty to approach the respondent authority by filing a detailed representation within one week from the date of the order. The respondents were directed to reconsider and decide this representation within one week thereafter, passing a speaking order after affording the petitioner an opportunity of being heard. The Court did not make a definitive finding on the legality of the initial cancellation order but provided a procedural remedy. If an adverse order was passed against the petitioner after this process, the petitioner was given the liberty to approach the appropriate forum. No specific issue was expressly left undecided, as the matter was resolved through a consent-based procedural direction.

Key Issues

1. Whether the cancellation of GST registration without affording an opportunity of being heard to the petitioner is legally sustainable? (Question of law, concerning principles of natural justice and relevant GST provisions). Petitioner's contention: The petitioner argued that the cancellation of its GST registration was arbitrary and violative of the principles of natural justice, as it was not given a chance to explain the reasons for non-filing of returns. The COVID-19 pandemic and the installation phase of the firm were cited as mitigating circumstances. Revenue's contention: The learned Advocate General for the respondents suggested that instead of prolonging the litigation, the petition could be disposed of by allowing the petitioner to file a detailed representation, which the respondents would consider in accordance with the rules. No specific statutory provisions or precedents were explicitly cited by the revenue in their argument.