Adjudicating authorities exercising statutory powers to cancel tax registrations must provide a speaking order by recording specific reasons, even when the assessee fails to respond to a show cause notice. Failure to provide reasons violates principles of natural justice and renders the administrative action arbitrary and illegal.

JUDGMENT & ORDER [ORAL]

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 her GST Registration under the Central Goods and Services Tax Act, 2017 has been cancelled by an Order dated 13.09.2024 pursuant to a Show Cause Notice dated 13.08.2024. 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 Cancellation Order has been passed without due application of mind.

2. It is the case of the petitioner that she is engaged in business of providing Light Motor Vehicles for hire as a proprietor of ‘Sunita Rai’. The petitioner carries on her business from the place of business at 122, No. 1 Bordubi Gaon, District – Tinsukia, Asssam-786601. The petitioner got herself registered 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]. When the petitioner applied for registration, the petitioner was issued a Registration Certificate in Form GST REG-06 with Registration no. 18ALGPR3503A1ZI w.e.f. 26.11.2021.

3. The petitioner was issued the Show Cause Notice on 13.08.2024 by the Proper Officer asking her to show cause as to why the Registration issued to her under the CGST Act should not be cancelled. The petitioner was thereby, asked to furnish a Reply within thirty days from the date of service of the Show Cause Notice. The petitioner was also directed to appear before the Proper Officer at 11-00 on 10.09.2024. 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. 13.08.2024.

4. Thereafter on 13.09.2024, the impugned Cancellation Order came to be passed whereby the petitioner’s GST Registration has been cancelled w.e.f. 13.09.2024.

5. I have heard Ms. B. Sarma, learned counsel for the petitioner; Mr. B. Sharma, learned Central Government Counsel for the respondent no. 1; and Ms. P. Upadhyay, learned counsel on behalf of Mr. S.C. Keyal, learned Senior Counsel & Special Counsel, CGST for the respondent nos. 2 & 3.

6. Ms. Sarma, 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 a Reply due to reasons beyond her control as it escaped her notice. It is projected there was miscommunication between the petitioner and her tax consultant and as a result, statutory compliance regarding filing of return in time escaped her attention. 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 13.09.2024 had already been uploaded in the common portal. The petitioner could submit upto September, 2024, 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 revoc