Bansal And Co. vs. State Of Punjab And Others

Facts

The petitioner, Bansal and Co., sought to set aside an order dated 24.05.2023 passed by respondent No.3, cancelling its GST registration. The cancellation was based on a show cause notice dated 05.05.2023, alleging that the petitioner had not conducted business at its declared place. The petitioner claimed to have submitted a detailed reply along with returns. The impugned order stated that the registration was cancelled because the persons with whom the petitioner was doing business at its premises were cancelled dealers. The State counsel identified M/s Kumar Enterprises, Ludhiana, and M/s AK Enterprises, Delhi, as cancelled dealers, noting that neither dealt in rice bran, the petitioner's stated business.

Held

The Court did not decide the merits of the cancellation order. Instead, it acknowledged the petitioner's grievance and the State counsel's submission that the petitioner has a remedy of seeking revocation of the impugned order under Section 30 of the PGST Act, 2017, by filing an application before the competent authority. The Court disposed of the petition by granting liberty to the petitioner to avail this statutory remedy if it so advised. The Court's decision was based on the availability of an alternative efficacious remedy rather than a determination of the legality of the cancellation itself. No specific finding was made on whether the petitioner was indeed dealing with cancelled dealers or whether its reply was adequate. The issue of whether the cancellation was justified was expressly left undecided.

Key Issues

1. Whether the cancellation of the petitioner's GST registration by respondent No.3, based on the petitioner allegedly conducting business with cancelled dealers, is legally sustainable, particularly when the petitioner claims to have submitted a reply and returns? (Question of law and fact, turning on Section 29 of the Punjab Goods and Services Tax Act, 2017 (PGST Act) and relevant rules). Petitioner's Contention: The petitioner argued that it had submitted a detailed reply and returns, and the cancellation order was passed without proper consideration of its response. The petitioner implicitly argued that the cancellation was arbitrary and not based on sufficient grounds. Revenue's Contention: The State counsel, on instructions, stated that the petitioner's registration was cancelled because it was dealing with cancelled dealers, specifically M/s Kumar Enterprises and M/s AK Enterprises. The State counsel also pointed out that the petitioner has a remedy of seeking revocation of the order under Section 30 of the PGST Act, 2017.