KOMAL ENTERPRISES v. THE COMMISSIONER OF GST DELHI
High Court, Delhi
Sanjeev Sachdeva, Justice & Ravinder Dudeja, Justice
KOMAL ENTERPRISES
v.
THE COMMISSIONER OF GST DELHI & ANR
W.P.(C) 6120/2024 & CM APPL. 25425/2024 dated 01.05.2024
Law : GST
Act Name : Central Goods & Services Tax Act, 2017
Relevant Section : Section 29
Decision : In favour of assessee
Retrospective cancellation of registration – cancellation order lacks details and reasoning – all returns filed till date of applying cancellation – Writ petition filed to challenge show cause notice and order cancelling registration with a retrospective date – Only reason cited in the show cause notice “Failure to furnish the returns since January 2022” – Both show cause notice and subsequent order did not provide reasons for the decision, and there were contradictions within the order itself – Petitioner claimed that they closed business and submitted an application for cancellation of GST registration in September 2020 – all returns were filed until December 31, 2021, when the business was still operational – Held that – Both the show cause notice and the subsequent order lack necessary details and reasoning, making them unsustainable – GST registration cannot be cancelled with retrospective effect mechanically; it must be based on objective criteria and deemed fit by the proper officer – Consequences of retrospective cancellation were acknowledged and emphasizes that such action should only be taken when warranted – Modified the cancellation order to cancel the registration effective from the date of the show cause notice issuance, i.e., June 22, 2022. Since the petitioner does not intend to continue the business or maintain the registration, the petition is disposed of accordingly.
Represented By:
Counsel for the Petitioner: Rajesh Singla & Pramod Gupta, Advocates
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