GST Update

Desk of CA. Praveen Sharma – 908 Series (CAPS)

Calcutta High Court in the case of S.K.M. Timber Private Limited

The petitioner challenged a GST registration cancellation order dated 9 December 2024, which was passed pursuant to a show cause notice issued in March 2024.

Earlier, the petitioner had already approached the High Court, which directed the tax authorities to grant a proper hearing and decide the matter. Despite these directions, no final decision was taken for a considerable period.

Even after contempt proceedings and repeated court directions, the department passed the cancellation order in a hurried and mechanical manner.

The Court observed that the validity of the original show cause notice could no longer be questioned, as that issue had already attained finality in earlier proceedings.

However, the cancellation order itself was found to be unsustainable since it did not deal with the petitioner’s reply and lacked proper reasoning or application of mind.

The Court also pointed out a serious procedural lapse, noting that the officer who conducted the hearing was different from the officer who passed the final order, which violated principles of fairness.

Accordingly, the cancellation order was set aside and the matter was remanded for fresh hearing and decision within four weeks. The petitioner was permitted to file additional documents, and no costs were imposed.

Link:CA. Praveen Sharma on Linkedin

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CAPS