Gujarat High Court Sets Aside Non-Speaking Order, Annuls GST Registration Cancellation
Gujarat High Court Sets Aside Non-Speaking Order, Annuls GST Registration Cancellation
The Gujarat High Court has emphasised that an order cancelling registration, issued without stating any reasons, is considered a non-speaking order, and thus, it can be invalidated.
The Division Bench of Justices Vipul M Pancholi and Devan M Desai, in response to a petition filed by Om Trading, a registered business under the Goods and Services Tax Act, delivered the aforementioned ruling. The petition challenged the cancellation of Om Trading's registration certificate by the Assistant Commissioner of State Tax, Ghatak 92.
Despite Om Trading's consistent engagement in base oil trading and regular reporting of business transactions in their returns, the Assistant Commissioner took action by uploading a show-cause notice on the GST portal. The notice proposed the cancellation of Om Trading's registration, alleging fraudulent means, wilful misstatement, or suppression of fact.
Om Trading, unaware of the show-cause notice as they had not been logging onto the GST portal, expressed their grievance over not receiving any supporting documents for the notice. Despite this, the respondent authority proceeded to cancel the petitioner's registration, prompting the filing of the present petition.
During the court proceedings, Assistant Government Pleader Pranav Trivedi, representing the respondent authorities, admitted that no speaking order had been issued during the cancellation of registration. He acknowledged that the cancellation was based solely on written communication. Furthermore, he clarified that if the order was nullified and fresh proceedings were permitted in accordance with the law, the respondent authority would raise no objection.
The Court observed that irrespective of the aforementioned points, the respondent authority did not dispute the fact that essential documents were not provided and the show-cause notice for the cancellation of registration was vague. Consequently, the petitioners were unable to adequately respond to the notice in question.
"It is not in dispute that while passing the impugned order for cancellation of registration, the respondent authority has not assigned any reason and thus, the order passed by the respondent authority is not a speaking order," the Court states as it allowed the petition.
Taking into account these circumstances, the Court rendered a verdict declaring both the show-cause notices and the cancellation order null and void. The Court granted liberty to the respondent authorities to issue a fresh notice, this time including specific reasons and comprehensive details.
Furthermore, the Court issued a specific directive to the concerned respondent, ordering the immediate reinstatement of Om Trading's registration. The petitioners were unambiguously instructed to diligently respond to the notice by submitting objections or replies, along with any necessary documents if requested by the authorities.
