Gujarat High court expressed its dissatisfaction with the department’s failure to adhere to the guidelines
In a recent development, the Gujarat High Court has summoned three high-ranking officials from the state and central GST departments to address concerns regarding the abrupt cancellation of GST registration without allowing adequate time for a response. The move comes in response to a case filed by a Bhavnagar-based firm, challenging the cancellation of its GST registration by the Central GST department’s Bhavnagar unit.
The crux of the matter revolves around the opaque nature of notices issued for the cancellation and suspension of GST registration. The Bhavnagar firm raised objections, stating that it was expected to respond to the notice on the very day it was received, leaving no room for a proper defence. Consequently, the firm sought relief from the Gujarat High Court.
The guidelines for Suo Moto cancellation of GST registration explicitly state that a registration cannot be cancelled without providing the taxpayer with a Show Cause Notice and affording them a reasonable opportunity to be heard by the Tax Official. In instances of Suo Moto cancellation, the Tax Official or Proper Officer is obligated to issue a Show Cause Notice, allowing the taxpayer to submit clarifications within a stipulated time frame.
During the hearing in Gujarat High Court, Sukhjit Kumar, Commissioner of the Bhavnagar CGST unit, appeared before Justice Bhargav Karia and Justice Niral Mehta. The court expressed its dissatisfaction with the department’s failure to adhere to the guidelines pertaining to the proposed cancellation of registrations. As a result, the court issued a warning, indicating that contempt notices might be issued if corrective measures were not promptly implemented.
Assuring the High Court of their compliance with its order, the GST officials pledged to rectify the situation, leading to the court subsequently disposing of the matter. This development underscores the significance of due process in tax-related matters and serves as a reminder to tax authorities to adhere to established guidelines, particularly when it comes to the cancellation of GST registrations.
In conclusion, businesses can now look to the Gujarat High Court’s intervention as a safeguard against hasty and unjust cancellations, emphasizing the importance of a fair and transparent process in dealing with GST-related issues. This case sets a precedent for the enforcement of proper procedures in the realm of taxation, providing reassurance to businesses across the region.
To Know about the exceptional Performance of DGGI in 2023 CLICK HERE
Also Read
Former CBIC Chief Calls for Clarity on GST for Online Gaming – Insights and Impact