GST registration not to be canceled when the order was passed without granting proper opportunity to file reply to the Show Cause Notice issued

[CA Bimal Jain]

The Hon’ble Andhra Pradesh High Court in the case of RAGHAVAIAH THELAPALLI VERSUS ASSISTANT COMMISSIONER AND OTHERS - 2024 (4) TMI 892 - ANDHRA PRADESH HIGH COURT allowed the writ petition and set aside the order canceling GST registration on the ground that, the person was not granted proper opportunity to file the reply against the Show Cause Notice issued.

Facts:

Raghavaiah Thelapalli (“the Petitioner”) filed a writ petition against the order dated June 16, 2023 (“the Impugned Order”) issued by the Revenue Department (“the Respondent”) wherein the Petitioner GST registration was canceled on the ground that, the Petitioner did not file the required returns under Section 29(2) of the Central Goods and Services Tax Act, 2017 (“the CGST Act”). Also, Show Cause Notice dated May 08, 2023 (“the SCN”) was issued by the Respondent for which the Petitioner could not file the reply.

Issue:

Whether GST registration be canceled when the order was passed without granting proper opportunity to file reply to the Show Cause Notice issued?

Held:

The Hon’ble Andhra Pradesh High Court in RAGHAVAIAH THELAPALLI VERSUS ASSISTANT COMMISSIONER AND OTHERS - 2024 (4) TMI 892 - ANDHRA PRADESH HIGH COURT held as under:

• Noted that, though the Petitioner did not file the reply to the SCN, the Impugned Order has been passed mechanically, without application of mind.
• Further Noted that, the reason for non-filing of reply to the SCN i.e. the person handling the GST matter of the Petition firm has left abruptly and the Petitioner was not aware of the issuance of the SCN could be considered as sufficient reason.
• Opined that, the Petitioner is entitled to the opportunity of hearing in consonance with the principles of natural justice.
• Held that, the writ petition is allowed and the Impugned Order is set aside.

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