In the instant case, the only reason set out in SCN to cancel registration, was: “In case, Registration has been obtained by means of fraud, willful misstatement
or suppression of facts.” SCN also suspended registration of the petitioner.
Contention of Petitioner against the SCN- It was contended that they had replied to the SCN inter alia contending that Directors of the Company had appeared
before the Officer and had given their respective statements as also submitted all the relevant documents. It was also contended that as initially the documents
submitted were not accepted by the department, they were forwarded by email. It was also pointed out that all documents were loaded on the portal while obtaining
the registration, details of which were also set out in the reply. Further, staff of the department had visited petitioner’s registered place of business, as also were
furnished documents. It was hence the petitioner’s case that the petitioner had cooperated with the department on all aspects.
Order by the Officer-The registration was cancelled stating that “You could not explain the reason for not being presented at the time of visit at P.O.B and A.P.O.B.
of MAKERSBURRY INDIA PRIVATE LIMITED, there were no any business activity found nor any stock found. Both the Directors or any Authorized Legal
Representative not represented the case or could furnish any statement satisfactorily. The reply submitted by the taxpayer dt. 25/08/2022 is not relevant to the
point raised in show-cause notice issued by this office. Hence, the same is not acceptable to this office. The effective date of cancellation of your registration is
Observation by the Court on order by Appellate Authority- In the backdrop of voluminous material being placed for consideration before the appellate authority,
it appeared that the authority proceeded to pass impugned order without considering such materials, thereby rejecting the petitioner’s appeal. The appellate
authority merely referred to the documents which were submitted. There was no discussion whatsoever to come to such conclusion and more particularly after
discussing the materials as submitted by the petitioner. Thus, clearly there was patent non-application of mind on reaching such conclusion without recording any
reason whatsoever to reject the petitioner’s appeal and maintain cancellation of registration.
Observation by the Court on the impugned order- SCN itself was defective, as it did not set out any reasons/grounds which could be responded by the
petitioner. The reasons which were furnished, as noted, were undoubtedly vague. It was difficult to conceive as to how such contents of the notice could be
responded when no reasons to support such allegation were provided in the SCN. The order passed cancelling the petitioner’s registration was inherently defective,
as again no reasons were furnished dealing with the case as set out by the petitioner in the reply as filed to the SCN. There was no discussion whatsoever on any
of the documents. Things did not stop at this, as the appellate authority before whom all such materials were furnished again proceeded on total non-application
of mind of the materials before it. Several documents although were submitted for consideration of the appellate authority, there was not a semblance of
consideration of any of those documents, much less any discussion on the documents to consider the case of petitioner.
Held by the Court-The Court set aside the order and opined that that time and again the department was not required to be told by the Court as to what would be
the position in law as also the correct approach in law, the officers need to follow. The Courts are being repeatedly called upon to adjudicate similar issues. There
had to be a sense of responsibility and accountability, any mechanical approach in this regard, even to justify such action, could not be the stand of the department.
Cases Referred- C.P. Pandey & Co. vs. Commissioner of State Tax (2023) 10 Centax 11 (Bom.), Monit Trading Pvt. Ltd. vs.UOI (2023) 8 Centax 248 (Bom.),
Ramji Enterprises & Ors. vs. Commissioner of State Tax & Ors. WP No. 277 of 2023 dated 10.07.2023, Nirakar Ramchandra Pradhan vs. UOI & Ors, WP No.
2534 of 2023 dated 11.09.2023, Lakkad Brothers vs. State of Gujarat (2023) 4 Centax 364 (Guj.), Quality Traders vs. Yogesh Kumar (2023) 10 Centax 150 (Del.)
and DRS Wood Products vs. State of Uttar Pradesh 2022(64) G.S.T.L. 132 (All.)