Cancellation of GST Registration Quashed Due to Non-Speaking Order

Case Title: M/s Enling and Co. v. Union of India & Ors.
Court: Gauhati High Court
Petition Number: WP(C)/1699/2025
Category: Cancellation of GST Registration
Date of Judgement: 01.05.2025
Relevant Sections: Section 29(2)(c), Section 107, Section 39 of CGST Act; Rule 21(h), Rule 22 of CGST Rules
Bench: Hon’ble Mr. Justice Manish Choudhury

Facts of the Case (¶1–¶6)

1. The Petitioner, M/s Enling and Co., a proprietorship registered under CGST with effect from 07.08.2017, received a show cause notice dated 14.01.2023 for non-filing of returns for six months (¶3).

2. Petitioner was required to respond within 30 working days and appear for a hearing on 11.02.2023, failing which the matter would be decided ex-parte (¶3).

3. Petitioner claims the notice escaped her attention, resulting in inability to respond or file for revocation or appeal within the limitation period (¶6).

4. Petitioner alleged nil business during the COVID-19 period, leading to continuous nil returns and no tax dues (¶6).

5. Cancellation order dated 18.03.2023 was passed without assigning reasons, contrary to statutory requirements (¶6.1).

6. Petitioner cited a similar case in WP(C) 1771/2025 where cancellation was quashed for similar grounds (¶6.1).

Question(s) in Consideration (¶8–¶10)

• Whether the cancellation order dated 18.03.2023 was valid in the absence of a speaking order and application of mind?

• Whether the procedural compliance under Rule 22 of the CGST Rules was adhered to?

• Whether the delayed filing of the writ petition should bar the petitioner from relief?

Observations of the Court

1. Court noted the show cause notice lacked specific period of default, violating due process (¶16).

2. Cancellation order cited a reply and personal hearing by the petitioner, which the petitioner denied under affidavit. No rebuttal was filed by respondents (¶18).

3. The cancellation order did not assign any reasons, violating the requirements under Rule 22(3) and Form GST REG-19 (¶22–¶25).

4. The Court emphasized that even in ex-parte cases, the Proper Officer must record reasons for cancellation (¶23–¶24).

5. Delay in approaching court was condoned due to statutory violation being more severe than procedural delay (¶26).

Judgement of the Court (¶27–¶30)

• The cancellation order dated 18.03.2023 was quashed as a non-speaking order passed without proper reasoning or application of mind (¶25–¶27).

• Matter remanded to the stage of SCN dated 14.01.2023 (¶27).

• Petitioner given one month to either:

  • File reply to SCN with reasons (Rule 22(2)); or

  • File all pending returns and pay tax dues with interest and penalty to seek relief under Rule 22(4) (¶29).

• Proper Officer directed to act accordingly and conclude proceedings within another month (¶29).

Between Fine Lines

• Even if no reply is submitted to SCN, cancellation of GST registration must be by a reasoned, speaking order.

• Procedural lapses, such as absence of specific default periods and failure to mention reasons, render the order invalid.

• Courts will condone delay where statutory violations override procedural timelines.

• Rule 22(4) allows revocation if dues are cleared and returns are filed even post-SCN.

• GST authorities must strictly follow cancellation procedures to avoid invalidation of orders.

Summary of Referred Cases

Disclaimer – “The above summary is for academic purpose only; not formal legal opinion. Seek professional opinion before application. Author or publisher or website shall not be responsible for any usage in any form.”