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2021 (2) TMI 1046 - ALLAHABAD HIGH COURTScope of SCN - Cancellation of assessee's registration on grounds different from those disclosed in the show cause notice - cancellation of registration of the assessee with retrospective effect - U.P. Value Added Tax Act, 2008 - HELD THAT:- There can be no dispute that before cancellation of registration, a reasonable opportunity of hearing has to be afforded to the affected dealer. In the present case, the notice does not disclose the exact nature of the charge leveled against the assessee inasmuch as it does not disclose the names of the other dealers with whom the assessee is alleged to have entered into fake and bogus transitions. Neither the show cause notice disclosed the exact nature of such transactions, nor the volume of such transactions nor the name of the dealer with whom asseessee is alleged to have traded in goods after cancellation of the registration of the other dealers or after closure of business by the other dealer. In absence of such disclosure contained in the show cause notice dated 24.10.2016, it is difficult to contemplate how a person in the shoes of present assessee could have responded to the show cause notice and defended the proceedings for cancellation of his registration. Unless the assessee had been confronted with the names of the dealers with whom it was alleged to have entered into bogus transactions and unless the details of such transactions had been disclosed in the notice itself and unless similar details of other dealers, who are alleged to have closed their business been disclosed the assessee could never have effectively responded to the charge/s leveled against him of having engaged in bogus transactions only for the purpose of availing I.T.C. Cancellation of registration is a very serious proceeding. It takes away the right of an assessee to do business. Therefore such a proceeding should be approached with that much more seriousness and case by the assessing authority. At present the assessing authority appears to have passed a wholly ex parte order inasmuch as in first place it had not disclosed to the assessee the exact nature of the charge leveled against him or the facts and circumstances in which his registration was being cancelled and in any case material that formed the basis of the charge was completely concealed from the assessee - appellate authority and the Tribunal have erred in not correcting the mistake thus committed by the assessing authority - answered in the negative i.e. in favour of the asseessee and against the revenue. The question relating to retrospective cancellation of registration, need not be answered - At the same time, keeping in mind the nature of allegation leveled against the assessee, the proceeding cannot be allowed rest here. It is then provided that the assessing authority shall issue a fresh notice in terms of the order dated 18.11.2016 and proceed in accordance with law. Revision allowed in part.
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