The main legal point established is that the cancellation of GST registration must be preceded by providing a reasonable opportunity to the registered person, and the process must be undertaken in accordance with the law.

JUDGMENT

(Prayer: Writ Petition filed under Article 226 of the Constitution of India, pleased to issue a Writ of Certiorarified Mandamus, call for the records of the impugned order of cancellation of registration vide reference No.ZA330123125884S dated 23.01.2023 with retrospective effect from 31.12.2022 from the files of the respondent herein, quash the same, and further direct the respondent to restore and activate the registration of the petitioner granted under the Central Goods and Services Tax Act, 2017 and the Tamil Nadu Goods and Services Tax Act, 2017 in GSTIN 33CHPPS5470J1ZQ.)

1. The petitioner assails an order of cancellation of registration dated 23.01.2023 with effect from 31.12.2022. The petitioner was a registered person under the GST regime. According to the petitioner, the requisite monthly returns were filed regularly until March 2022. During the Covid-19 pandemic, the petitioner's business was affected and the petitioner did not have any outward supply for a period of about six months. As the petitioner's business started improving after the end of the pandemic, it is stated that the petitioner was shocked to be put on notice that the GST registration was cancelled. The present writ petition arises in the said facts and circumstances.

2. Learned counsel for the petitioner submits that the show cause notice was uploaded on the GST portal, but was not otherwise communicated to the petitioner. Being a small business person, the petitioner was unaware of the posting of the show cause notice on the portal. Therefore, the petitioner could not reply to the show cause notice. By inviting my attention to the impugned order, learned counsel points out that the said order was issued mechanically as is evident from the reference to a reply dated 04.10.2022 in the first line followed by the statement in the second line that no reply was given. She also points out that sub-rule (4) of Rule 22 of the CGST Rules enables the authority to drop the proceedings for cancellation, if appropriate remedial action is taken by the registered person.

3. By referring to the judgment of the Bombay High Court in Ahmed Enterprises v. Union of India (Ahmed Enterprises) (2023)13 Centax 209 (Bombay), learned counsel submits that, in nearly identical fact situation, the Bombay High Court quashed the order of cancellation, restored the registration and permitted the GST authorities to take further action in accordance with law. She makes a request that a similar order be issued.

4. Mr.K.Mohanamurali, learned SPC, accepts notice on behalf of the respondent. He points out that the GST registration of the petitioner was cancelled in terms of Section 29(2)(b) and (c) of the applicable GST Provisions. Therefore, he submits that no interference is warranted.

5. The question that falls for consideration is whether the petitioner was provided a reasonable opportunity before the drastic order of cancellation of registration was issued. From the show cause notice, it appears that such notice was digitally signed by the Goods and Services Tax Network. When the said show cause notice is read with the impugned order, it is quite evident that the whole process has been undertaken mechanically. As pointed out by learned counsel for the petitioner, lines 1 and 2 of the impugned order are undoubtedly contradictory. Since such impugned order has resulted in great prejudice to the petitioner without the petitioner being provided a reasonable opportunity to respond, the impugned order calls for interference.

6. In the judgment of the Division Bench of the Bombay High Court in Ahmed Enterprises, it was held as under in paragraphs 8 to 10:

"8. In the aforesaid circumstances, we have no manner of doubt that this petition would also be required to be disposed of in terms of what has been held by this Court in the decisions as noted above. The petition is accordingly allowed in terms of prayer clause (a), which reads thus;

"(a) issue an appropriate