As the personal hearing part before suspension is a statutory requirement which having not been complied with, the suspension part in the show cause notice for cancellation is bad in law and is set aside.
Section 29 of the CGST Act —Cancellation of Registration – The petitioner challenged SCN dated 2nd December, 2020 for cancellation of the GST registration in Form GST REG-17. By the said notice the petitioner’s registration has also been suspended with effect from 2nd December, 2020. The petitioner submitted that notice for suspension is contrary to the provision of Section 29(2) and rule 21A because it is issued without a personal hearing. Rule 21A has been amended by notification no.94/2020-Central Tax dated 22nd December, 2020. The hearing which was provided under sub-rule 2 of Rule 21A has been omitted with effect from 22nd December, 2020. The respondent submitted that the hearing provided in Section 29 is regarding the cancellation and not for suspension but admits that rule 21A provides for a hearing prior to suspension. The court observed that when the notice was issued on 2nd December, 2020, the rule 21A was not amended and as such a hearing was required to be given to the petitioner prior to the registration of the petitioner being suspended.
Held that:- The Hon’ble High Court set aside the suspension part in the show cause notice for cancellation dated 2nd December, 2020. Further directed the authority concerned to give a personal hearing to the petitioner in terms of Section 29(2) for the purpose of adjudicating the cancellation issue, within three weeks. The authority concerned shall issue a specific notice informing the petitioner about the date and time of hearing well in advance and the petitioner co-operate in the hearing.
As the personal hearing part before suspension is a statutory requirement which having not been complied with, the suspension part in the show cause notice for cancellation is bad in law and is set aside.
Section 29 of the CGST Act —Cancellation of Registration – The petitioner challenged SCN dated 2nd December, 2020 for cancellation of the GST registration in Form GST REG-17. By the said notice the petitioner’s registration has also been suspended with effect from 2nd December, 2020. The petitioner submitted that notice for suspension is contrary to the provision of Section 29(2) and rule 21A because it is issued without a personal hearing. Rule 21A has been amended by notification no.94/2020-Central Tax dated 22nd December, 2020. The hearing which was provided under sub-rule 2 of Rule 21A has been omitted with effect from 22nd December, 2020. The respondent submitted that the hearing provided in Section 29 is regarding the cancellation and not for suspension but admits that rule 21A provides for a hearing prior to suspension. The court observed that when the notice was issued on 2nd December, 2020, the rule 21A was not amended and as such a hearing was required to be given to the petitioner prior to the registration of the petitioner being suspended.
Held that:- The Hon’ble High Court set aside the suspension part in the show cause notice for cancellation dated 2nd December, 2020. Further directed the authority concerned to give a personal hearing to the petitioner in terms of Section 29(2) for the purpose of adjudicating the cancellation issue, within three weeks. The authority concerned shall issue a specific notice informing the petitioner about the date and time of hearing well in advance and the petitioner co-operate in the hearing.