DNC Infrastructure Pvt. Ltd. vs The Superintendent

In a recent court proceeding in the Department Counsel, it was argued that the cancellation of Goods and Services Tax (GST) registration for the petitioner was not due to the failure to file returns, but rather because the petitioner allegedly engaged in fraudulent practices by illicitly claiming Input Tax Credit (ITC) amounting to Rs. 31 Crores. Notably, this alleged fraudulent activity was not explicitly mentioned in the Show Cause Notice (SCN) nor in the final order issued.

The High Court, after careful consideration, ruled in favor of the petitioner. The court emphasized that the primary reason cited for the cancellation of GST registration was the delay in filing returns, and this delay had been rectified by the petitioner within the stipulated time frame of six months. Furthermore, the court highlighted that the alleged fraudulent availing of ITC, which was a significant accusation, was not included in either the SCN or the final order.

Based on these grounds, the High Court concluded that the impugned order was unsustainable. Consequently, the court set aside and quashed the order, providing a favorable outcome for the petitioner. This legal decision underscores the importance of clear and specific grounds in official orders and highlights the need for a solid legal basis for actions such as GST registration cancellations.