TMI Blog2016 (8) TMI 296X X X X Extracts X X X X X X X X Extracts X X X X ..... . A.J. SHASTRI, JJ. FOR THE APPELLANT : MR ANKIT SHAH, ADVOCATE FOR THE OPPONENT : MR.PRANAV TRIVEDI, AGP ORAL JUDGMENT (PER : HONOURABLE MR.JUSTICE A.J. SHASTRI) 1. By way of present Tax Appeal, the appellant is challenging the validity of an order passed by the Gujarat Value Added Tax Tribunal dated 24.12.2014 passed in Second Appeals Nos.940 and 941 of 2014. While admitting the Tax Appeal, the Division Bench of this Court has framed following substantial question of law for consideration. Whether, on the facts and in the circumstances of the case, the Gujarat Value Added Tax Tribunal was justified in holding that there was no requirement for service of any notice in accordance with Form No.104 as contemplated under subrule (3) of rule 10 of the rules before cancellation of registration of the assessee under subsection (5) of section 27 of the Gujarat Value Added Tax Act, 2003 ? For considering the same, we may refer to the facts of the case. 2. The appellant herein is a private limited company dealing in the business of dyes and chemicals and for the same purpose, the appellant had obtained TIN number from the VAT Authority. It is the case ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... il. The authority had not provided appropriate opportunity at the relevant point of time and merely has proceeded to record the statement at site of one Mr.Ramesh Ambalal Patel, who was not having any material or information. Learned Tribunal has erred in not granting opportunity to the appellant. It was also contended by the counsel for the appellant that under the provisions of the VAT Act, under section 100 read with section 27(5) (I), the specific procedure is prescribed to deal with such a situation and by submitting that the counsel for the appellant has drawn the attention of the Court about the rule No.10 which deals with cancellation or suspension of certificate of registration and based upon this, the counsel submitted that the authorities have not considered whether before taking any action, there is compliance of this rule. It was also brought to the notice of the Court that if the Commissioner intends to cancel or suspend the registration of any dealer under section 27(5) or 27(5A) of the Act, then first of all, there must be a reflection of intention of the Commissioner to cancel the registration and secondly, to implement that intention, it is required to communicate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erefore, counsel contended that qua this issue or cancellation of registration, no opportunity of effective representation and hearing is given and that being the situation, the order of cancellation of registration deserves to be set aside since this material aspect touching the root of controversy has not been properly dealt with by the learned Tribunal, the learned counsel submitted that order requires to be interfered with. 4. As against this, the learned AGP Mr.Pranav Trivedi has contended before this Court that the appellant was given adequate and effective hearing and full opportunity was given to the appellant and it has been contended that from the beginning, the appellant was aware about the fact that the issue pertaining to these two traders was center of controversy. Learned AGP had contended that the Appellate Authority while dealing with an appeal, has brought to the notice of the appellant about this fact and granted effective opportunity. The appellant could have anticipated the ultimate outcome upon it. Learned counsel submitted that even if no opportunity at the relevant point of time is granted on the issue of cancellation of registration, then also, there is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ates the cancellation of registration. (2)If the registering authority is satisfied that the application submitted under subrule (1) is in order, it shall by order in writing, cancel the registration with effect from the date, which may be fixed in accordance with the provision of subsection (4) of section 27. (3) When the Commissioner intends to cancel or suspend the registration under subsection (5) or (5A) of section 27, he shall give a notice to the dealer in Form 104. 6. Subrule (3) of rule 10 postulate a specific mandate to the authority that when the Commissioner intends to cancel or suspend the registration under subrule (5) or (5A) of section 27, he shall give a notice to the dealer with form No.104. Undisputedly, therefore it appears from the record that such procedure has never been observed. Section 27(5) of the VAT Act is the main source of power to deal with suspension or cancellation of registration. If we read rule 21, subrule (4b) of the VAT Act it also refers to a certain procedure to be observed before taking decision with respect to cancellation or suspension of registration. From the record, it appears that the authority before canceling the registrati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... given. Even if not in precise in form No.104 where in any other manner, notice was issued to the assessee that for the tentative reasons indicated in the communication, his registration is liable to be canceled, the department's contention that reasonable opportunity was given could have been considered. In the present case however, no notice either in form No.104, or any other manner was issued to the petitioner why the registration should not be canceled. The reasonable opportunity concept is brushed aside before taking action against the appellant and therefore, the impugned orders are required to be quashed and set aside hereby. We may observe that despite above circumstance, we may allow impugned orders to operate, then indirectly we are recognizing post decisional hearing issue which is not envisaged in any of the rules referred to above. Rule of natural justice demands that at a stage where it is to be observed authority has to observe at that stage only subsequent grant of opportunity will not cure the defect. 8. The Court observed while passing this order that there is some element of grievance by the department that despite notices in form No.401 and 309 have been ..... X X X X Extracts X X X X X X X X Extracts X X X X
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