GST system issued a show cause notice for cancellation of registration by fixing a personal hearing on 2nd October (Gandhi Jayanti, the public holiday) and thereafter immediately cancelled the registration without any actual hearing. 

High court set aside the impugned order.

High Court also directed the revenue to do the needful to make necessary changes in the software to ensure that errors of the aforesaid kind do not recur. 

It is submitted by learned counsel for writ petitioner that an order cancelling the registration of the writ petitioner being order dated 14.10.2019 has been called in question. The impugned order was preceded by a show-cause notice.

Be that as it may, learned counsel for writ petitioner submits that cancellation of registration is under Section 29 of TNGST Act and vide proviso to Section 29(2) of TNGST Act, a proper officer cannot cancel the registration without giving an Assessee an opportunity of being heard. It is the specific case of the writ petitioner that he did not notice the SCN which was hosted in the portal and therefore, he did not send a reply. Interestingly and intriguingly, the impugned order reads as follows:

A perusal of the impugned order reveals that in one breath it says that the dealer has not filed any objection/reply in response to the SCN and in the same breath it says that the proper Officer has examined the reply made at the time of hearing and is of the view that the registration is liable to be cancelled for the following reasons, but no reasons have been set out. In other words, this is not a speaking order. Furthermore, a perusal of the SCN reveals that it talks about a personal hearing on 02.10.2019 and 2nd October is a public holiday on account of Gandhi Jayanthi.

Be that as it may, learned counsel for writ petitioner submits that he did not resort to revocation of the cancellation under Section 30 of TNGST Act as the time stipulated for revocation had elapsed and therefore, the writ petitioner filed an appeal under Section 107 and the appeal under Section 107 came to be disposed of vide an Memorandum dated 03.05.2021 by the Appellate Authority solely on the ground of limitation without expressing any opinion or going into the merits of the matter. 

Learned Revenue counsel submits that SCN dated 25.09.2019 has been issued with an inadvertent error as it is a computer generated SCN and it has inadvertently fixed personal hearing on 02.10.2019 which is a public holiday on account of Gandhi Jayanthi.

Respondent-Department regrets the error is learned counsel's say. Be that as it may, on instructions it is submitted by learned Revenue counsel that no personal hearing was held on 02.10.2019 or thereafter. This by itself becomes a ground to set aside the impugned order and relegate the matter back to respondent. However, owing to the admitted error in SCN, this Court deems it appropriate to set aside the same also with a directive to reissue the SCN after eliminating the error.

This Court deems it appropriate to observe and direct the respondent and the authorities above the respondent to do the needful to make necessary changes in the software to ensure that errors of the aforesaid kind (as in the case on hand) do not recur. In other words, the Department will do the needful to make changes in the software to avoid such predicaments.

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