📰 𝗗𝗲𝗹𝗵𝗶 𝗛𝗶𝗴𝗵 𝗖𝗼𝘂𝗿𝘁 𝗥𝘂𝗹𝗶𝗻𝗴: Retrospective GST Registration Cancellation Curbed

📢 The court emphasized, "GST registrations cannot be cancelled with retrospective effect unless explicitly mentioned in the show-cause notice, ensuring taxpayers are aware of potential retroactive actions."

🔍 𝗙𝗮𝗰𝘁𝘀 • 𝗖𝗮𝘀𝗲 𝗧𝗶𝘁𝗹𝗲: Aditya Polymers vs Commissioner of Delhi Goods and Services Tax • 𝗖𝗮𝘀𝗲 𝗡𝘂𝗺𝗯𝗲𝗿: W.P.(C) 14493/2022 • 𝗖𝗼𝘂𝗿𝘁: Delhi High Court • 𝗗𝗮𝘁𝗲: 28-Mar-2023

𝗜𝘀𝘀𝘂𝗲: Aditya Polymers’ GST registration was cancelled due to non-filing of returns, with an effective date from the original registration on 01-Jul-2017. The petitioner did not respond to the initial show-cause notice or file a revocation application but later filed an appeal, which was dismissed as time-barred. The petitioner then approached the High Court, challenging the retrospective cancellation.

⚖ 𝗛𝗶𝗴𝗵 𝗖𝗼𝘂𝗿𝘁 𝗢𝗯𝘀𝗲𝗿𝘃𝗮𝘁𝗶𝗼𝗻𝘀 • Section 29(2) grants the Proper Officer the power to cancel a GST registration from any date deemed appropriate, including a retrospective date. • However, cancellation from an earlier date must be reasonable and justified with a clear rationale, and the taxpayer should be notified if a retrospective cancellation is proposed.

⚖ 𝗝𝘂𝗱𝗴𝗺𝗲𝗻𝘁 The court held that since the show-cause notice did not indicate the possibility of retrospective cancellation, the petitioner had no opportunity to respond to such a proposal. The High Court ordered that the cancellation should be effective from 11-Dec-2020 (date of the notice) rather than 01-Jul-2017.

📜 This ruling clarifies that retrospective GST cancellations require clear notice, ensuring taxpayer awareness and an opportunity to respond to retroactive actions. Team GSTpanacea 7503031378