Case Title:
Rani Construction v. Superintendent of Taxes, Guwahati & Ors.
Court:
Gauhati High Court
Citation:
[2025] 176 taxmann.com 206 (Gauhati)
Date of Order:
18 March 2025
Coram:
Justice Suman Shyam and Justice Malabika Bhattacharjee
Key Facts:
- The petitioner’s GST registration was cancelled by the tax department via an order that did not assign any reasons.
- The show-cause notice issued earlier was vague and did not specify clear grounds for cancellation.
- The cancellation order was a non-speaking order, merely reproducing statutory language without application of mind.
Legal Issue:
Whether a GST registration cancellation order that lacks reasoning or specific findings is valid under law.
Held:
- The principles of natural justice require that any adverse order must be a reasoned (speaking) order.
- The impugned order was set aside on the ground that it did not disclose any application of mind or justification for cancellation.
- The department was given liberty to issue a fresh show-cause notice, if necessary, with proper reasons and after giving an opportunity of hearing.
Key Observations:
- The court emphasized that mere quoting of legal provisions without explanation is insufficient.
- The taxpayer must be informed of the precise grounds so as to enable them to respond meaningfully.
- A non-speaking order violates Article 14 of the Constitution (equality before the law and fairness in administrative action).
Conclusion:
The Gauhati High Court quashed the GST cancellation order and restored the petitioner’s registration, emphasizing the need for transparency and reasoned decision-making in administrative actions under GST law.