GSM INDUSTRIES Vs UNION OF INDIA

The Court has thoroughly considered arguments from both sides regarding the cancellation of the petitioner’s registration. The primary issue raised by the petitioner is that the show cause notice was overly vague and the cancellation order was unreasonably brief. The petitioner attempted to appeal this decision but was rejected by the Appellate Forum due to a delay in filing the appeal, which the respondent used as a defense.

Before delving into the specifics of the case, the Court was presented with Order No.1 of 2020 from the Central Tax, dated June 25, 2020, issued by the Ministry of Finance’s Central Board of Indirect Taxes and Customs. This order outlines the appeal process under Section 107 of the relevant Act. Specifically, it states that:

1. Sub-section (1) of Section 107 allows any aggrieved person to file an appeal within three months of the decision or order being communicated.

2.Sub-section (4) of Section 107 grants the Appellate Authority the discretion to extend this period by an additional month if the appellant shows sufficient cause for the delay.

Furthermore, the order notes that numerous registrations have been cancelled under Sub-section (2) of Section 29 by the proper officer, who served notices under Clause (c) and Clause (d) of Sub-section (1) of Section 169. The text suggests that the standard thirty-day period for applications has been a significant factor in the volume of cancellations.

Given these procedural guidelines, the Court must assess whether the petitioner’s reasons for the delayed appeal constitute “sufficient cause” under the framework provided by the Act and whether the cryptic nature of the show cause notice and the brevity of the cancellation order were justified or warrant a reevaluation of the petitioner’s case.

The court has substantially heard the arguments presented by the learned advocates on both sides of the case. The central issue revolves around the cryptic nature of the show cause notice and the one-line order for cancellation of registration, which forms the core of the petitioner’s arguments. The respondent, on the other hand, argues that the petitioner had approached the Appellate Forum, which refused to entertain the appeal due to a delay in filing it.

Before delving into these arguments, the court was shown Order No.1 of 2020 of Central Tax dated June 25, 2020, issued by the Government of India, Ministry of Finance, Central Board of Indirect Taxes and Customs. This order addresses the issue of appeals and revocation of cancelled registrations under the GST Act. Specifically, it highlights the provisions under sub-section (1) of section 107 of the Act, which allows an aggrieved person to file an appeal within three months from the communication of the decision or order. Additionally, sub-section (4) of section 107 permits the Appellate Authority to extend this period by one month if sufficient cause is shown.

The order acknowledges that many registrations have been cancelled under sub-section (2) of section 29 of the Act by serving notices under clauses (c) and (d) of sub-section (1) of section 169. It also recognizes that the period for applying for revocation of cancellation, filing an appeal, and condoning delays has often elapsed, leaving affected taxpayers unable to revoke their cancelled registrations despite fulfilling all requirements. The order indicates that since the GST Act is relatively new, many taxpayers were unable to apply for revocation within the specified thirty-day period, leading to difficulties in implementing the provisions of sub-section (1) of section 30 of the Act.

Learned advocate Mr. Hasit Dave asserts that the petitioner is willing to pay the due taxes and will seek revocation from the concerned officer. He also mentions that the Apex Court’s directions for extending deadlines during the COVID-19 pandemic will aid the petitioner’s case. This willingness to comply with tax obligations and the supportive stance of the Supreme Court during the pandemic are intended to bolster the petitioner’s position.