Lawgics – Judgment No. 200

Synopsis: GST RC cancellation is not justified as petitioner was not given fair opportunity to respond.

Case Name: M/s. Genius Orthos Industries VS Union of India & Ors.

Citation: WRIT TAX No. 542 of 2023 dated 24.04.2025

Authority: Allahabad High Court

Brief facts of the case:

The petitioner was engaged in the business of surgical goods and its GST registration was cancelled on 19.12.2022 after a physical verification of its premises allegedly found no inputs, finished goods, or workers. A show cause notice was issued prior to cancellation, but the petitioner claimed they were not informed of the specific material findings leading to the cancellation. The appeal against the cancellation was also dismissed.

Contentions of the Petitioner:

The principles of natural justice were violated, as no proper notice of the specific material against them was given. Cancellation was based on vague grounds, and the watchman at the premises had confirmed that business activities were conducted, albeit irregularly. Rule 25 of the CGST Rules and Form GST REG 30 was not referenced in actual SCN.

Contentions of the Department:

The petitioner had due knowledge of the discrepancies found during physical verification and failed to provide a satisfactory explanation. Claimed that the cancellation order was justified due to absence of business activity at the registered premises.

Findings and Decision of the Court:

The High Court found that the cancellation was done without due process, especially considering that:

• The material used for cancellation was never properly shared with the petitioner.
• The statement of the watchman indicating occasional business activity was ignored.
• The physical verification report (GST REG-30) was not referenced in the show cause notice.

Thus, impugned cancellation and appellate orders were quashed and the matter was remanded to the proper authority for fresh adjudication within three months, ensuring that a reasoned and speaking order is passed after an Opportunity of hearing is granted. The petitioner may submit relevant evidence.