CASE SUMMARY
GST cancellation upheld; petitioner relegated to appellate remedy as non-appearance vitiated writ maintainability
Case Title: M/s AK Enterprises Through Its Proprietor Sh. Ankit Kumar v. Sales Tax Officer Class II / AVATO Ward 75, Zone 7, Delhi & Anr.
Court: High Court of Delhi
Petition No.: W.P.(C) 5962/2024
Date of Judgment: 04.09.2024
Statutory Provisions Involved:
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Section 29, CGST Act, 2017 – Cancellation of registration
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Section 30, CGST Act, 2017 – Revocation of cancellation
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Rule 21, CGST Rules, 2017 – Grounds for cancellation
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Rule 25, CGST Rules, 2017 – Physical verification
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Rule 23, CGST Rules, 2017 – Procedure for revocation
Category of Dispute: GST Registration Cancellation – Retrospective effect; Non-existence at principal place of business
FACTS (Paras 3–8)
The petitioner challenged the cancellation of its GST registration through an order dated 29.11.2023, which cancelled the registration retrospectively from 07.02.2022. The cancellation stemmed from a Show Cause Notice dated 08.11.2023 issued on the basis of a communication received from the Directorate General of GST Intelligence (DGGI) stating that the taxpayer was non-existent at the principal place of business. A second physical verification on 26.10.2023 again found the petitioner absent at the declared address (para 5). Despite being directed to reply and appear on 04.11.2023, the petitioner did not respond or appear before the proper officer (para 7). Consequently, the cancellation order was passed.
QUESTIONS BEFORE THE COURT (Issues Framed from Paras 3–12)
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Whether the cancellation order passed under Section 29 CGST Act could be interfered with in writ jurisdiction when the assessee failed to respond to the SCN or appear before the authority?
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Whether the petitioner could bypass the statutory appellate remedy under Section 107 merely by invoking Article 226?
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Whether the factual dispute regarding existence at place of business could be adjudicated in writ proceedings?
OBSERVATIONS OF THE COURT (Paras 9–12)
The Court reiterated that the petitioner had an equally efficacious alternate remedy of filing an appeal under Section 107 against the cancellation order (para 9). The Court emphasised that the petitioner did not reply to the SCN or appear for the personal hearing (para 7), and therefore, the grievance regarding improper cancellation could not be adjudicated without examining factual aspects. Such factual examination is beyond writ jurisdiction and lies squarely within appellate review.
The Court clarified that the petitioner’s contention of being “existing at the principal place of business” is a pure question of fact to be established before the appellate authority (para 10). Recognising that time for filing appeal may have expired, the Court permitted the petitioner to file an appeal within two weeks, directing that such appeal be considered without objection on limitation and be decided expeditiously (para 11).
JUDGMENT / VERDICT (Paras 9–13)
The writ petition was disposed of, with the Court refusing to entertain the challenge due to the availability of the statutory appellate remedy (para 9). The petitioner was granted two weeks to file an appeal along with all supporting documents (para 10–11). The appellate authority was directed to consider the appeal on merits, without being influenced by delay (para 11). The scheduled later hearing date of 14.11.2024 was also cancelled (para 13). No relief was granted on merits of cancellation.
SUMMARY OF CASES REFERRED
(The judgment does not cite any external precedents; hence the table includes only the present case.)
| Sl. No. | Case Name | Court | Issue | Verdict |
|---|---|---|---|---|
| 1 | M/s AK Enterprises v. Sales Tax Officer Class II/AVATO Ward 75, Zone 7 | Delhi High Court | Challenge to GST registration cancellation for non-existence at PPOB and non-response to SCN | Writ dismissed; petitioner relegated to appellate remedy; appeal allowed to be filed within 2 weeks |
BETWEEN FINE LINES (Trade / Industry Takeaway)
This order reiterates that non-response to a show-cause notice and failure to appear for hearing severely weakens any challenge to GST cancellation. When cancellation is grounded on physical verification and alleged non-existence at the registered business address, the Court expects taxpayers to pursue the statutory appeal rather than invoke writ jurisdiction. The ruling reinforces that factual disputes such as “whether the business existed at the declared premises” must be proved before the appellate authority, not through constitutional writs.
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