A cancellation order under the CGST Act must be a speaking order, providing reasons for the decision to ensure compliance with principles of natural justice.

JUDGMENT & ORDER :

MANISH CHOUDHURY, J.

The petitioner has approached this Court by the instant writ petition, preferred under Article 226 of the Constitution of India, on the premise that its GST Registration under the Central Goods and Services Tax [CGST] Act, 2017 has been cancelled by an Order dated 10.02.2021 pursuant to issuance of a Show Cause Notice dated 05.01.2021. The assail is made inter-alia on the grounds that the manner in which the GST Registration has been cancelled is arbitrary and the impugned Order of cancellation has been passed without due application of mind.

2. It is the case of the petitioner that he is a Works Contractor and one of the partner in a partnership firm by name, M/s Sri Guna Ram Nirmolia and Co, having its registered office at Duliajan, District – Dibrugarh, Assam. The petitioner got himself registered as partnership firm under the Central Goods and Services Tax [CGST] Act, 2017 [‘the CGST Act’, for short]/State Goods and Services Tax [SGST] Act, 2017 [‘the SGST Act’, for short]. It is stated that when the petitioner applied for registration, the petitioner was issued a Registration Certificate in Form GST REG-06 with Registration no.18AAOFG4491K1ZR w.e.f. 18.05.2018.

3. The petitioner was issued the Show Cause Notice on 05.01.2021 by the Proper Officer asking him to show cause as to why the Registration issued to him under the CGST Act should not be cancelled due to failure on its part to furnish returns for a continuous period of six months. The petitioner was thereby, asked to furnish a Reply within seven working days from the date of service of the Show Cause Notice. The petitioner was also directed to appear before the Proper Officer at 10-28 a.m. on 12.01.2021. It was further mentioned that if the petitioner would fail to furnish a Reply within the stipulated date or would fail to appear for personal hearing on the appointed date and time, the case would be decided ex-parte on the basis of the available records and on merits. By the Show Cause Notice, the petitioner’s Registration under the CGST Act had also been suspended w.e.f. 05.01.2021.

4. Thereafter on 10.02.2021, the impugned Order came to be passed whereby the petitioner’s GST Registration has been cancelled w.e.f. 10.02.2021.

5. I have heard Mr. S.K. Agarwal, learned counsel for the petitioner and Mr. S.C. Keyal, learned Standing Counsel, CGST for all the respondents.

6. Mr. Agarwal, learned counsel for the petitioner has submitted that in response to the Show Cause Notice, which was uploaded in the common portal, the petitioner could not submit its reply due to reasons beyond his control as it escaped its notice. It is submitted that due to advent of Covid-19 and its continuance, the petitioner’s business suffered hugely in an adverse manner. It is submitted that the petitioner came to learn about the Show Cause Notice when the time for filing the Reply was already over and the impugned Order dated 10.02.2021 had already been uploaded in the common portal. After improvement of the Covid-19 situation and with gradual revival of the business of the petitioner, the petitioner submitted returns upto February, 2021, as allowed by the GST Portal. Though the petitioner tried to submit an application for revocation, the GST portal did not allow submission of such application as the time-limit prescribed for filing of revocation of application was already over by then. Similarly, the petitioner could not prefer an appeal due to expiry of the statutory period of limitation.

6.1. Mr. Agarwal has submitted that the impugned Order of cancellation of GST Registration is to be passed in Form GST REG-19 and the Proper Officer while cancelling a registered person’s GST Registration, has to assign the reasons for cancellation of registration. But, the impugned Order dated 10.02.2021 is a non-speaking and cryptic one. He has further submitted that the case of the present petitioner is substantially similar to the case of the petitioner in the writ pe