ORDER :

MAUNA M. BHATT, J.

1. This petition under Article 226 of the Constitution of India is preferred with the prayer to quash and set aside the showcause notice dated 26.05.2022, as also the order of cancellation of registration dated 11.10.2022.

2. The briefly stated facts:

2.1 The petitioners engaged in the business of trading in bullion, were duly registered under the provisions of Central/Gujarat Goods and Services Tax Act, 2017 (hereinafter referred to as “the Act”). It is case of the petitioners that sale and purchase of goods is their usual course of business and all their transactions were duly reflected in the returns filed. The taxes were duly paid as per the returns filed. All the transactions of the petitioners were duly supported by tax invoices and all the payments were made through banking channels. A search proceeding was carried out by the Central GST Department at the premises of the petitioners on 08.12.2021. On the allegation of wrongful availment of Input Tax Credit (ITC) under the GST Act to avoid coercive action, the petitioners reversed ITC of Rs.90,00,000/- and further made payment of Rs.2,00,00,000/- through electronic cash ledger under protest to show their bonafides and also to avoid coercive actions.

2.2 It is further case of the petitioners that, however, Officers of the State GST Department visited the premises of the petitioner in May, 2022 for inquiry. The visit to premises was without prior intimation and at the relevant time only employees of the petitioners were present. Thereafter, respondent No.2 herein, who is a State GST Officer issued a show-cause notice on 26.05.2022 proposing to cancel the registration of the petitioners by alleging that the petitioners were engaged in issuing invoices. It is case of the petitioners that the said allegation was uncorroborated and without any supporting materials to form such basis. The petitioners responded to the said show-cause notice vide reply dated 02.07.2022. It was replied that the notice was completely vague and bereft of any reasons and without any supporting materials. It was also replied that they are not in a position to give any response to the notice unless and until they have been given some basis for issuing such notice. Thus, the request was made by the petitioners to drop the show-cause notice or to provide details, basis which the allegations were made in the show-cause notice. The petitioners also gave another submission dated 08.09.2022 requesting to restore the registration and requested for personal hearing. However, no such request was acceded to and the respondent No.2 passed an order canceling the registration certificate of the petitioners on the ground which was never form part of the notice.

2.3 Aggrieved by the aforestated actions of the respondent, present petition is filed.

3. Heard learned advocate Mr. Uchit N. Sheth for the petitioners and learned Asst. Government Pleader Ms. Pooja Ashar for the respondents. Notice, in this case, has been issued vide order dated 17.11.2022, for final disposal. Affidavit-in-reply on behalf of respondent No.2 has been filed.

4. Appearing for the petitioners, learned advocate Mr. Uchit N. Sheth submitted that the order canceling registration certificate dated 11.10.2022, is beyond the scope of showcause notice, arbitrary and in breach of principles of natural justice. He further submitted that the show-cause notice being non-speaking and being bereft of any reasons is illegal. The show-cause notice dated 26.05.2022 was so vague that it would not be possible for the petitioners to respond to the same as no supportive documents were provided despite sought for. Even the respondent No.2 – Authority had proceeded to pass the order canceling the registration certificate of the petitioners without providing any opportunity of hearing. The material based on which the allegations were made in the show-cause notice were not provided to the petitioners. Therefore, also the initiation of the proceedings