Section 29 of the CGST Act, 2017— Cancellation of Registration – Suspension of Registration during pendency-- The petitioner assailed legality and validity of SCN for cancellation of registration passed on 06.04.2022. The counsel for the petitioner submitted that the power to suspend registration during the pendency of proceedings for cancellation of registration, as envisaged under Section 29 is a drastic power, where the registration may remain suspended even during the pendency of the proceedings. The court observed that the power being drastic in nature, which has the effect of bringing to a grinding halt, a running business, the authority is required to decide the matter at the earliest where it takes recourse to its power of suspension of registration during pendency of the proceedings for cancellation of registration. Even though reply was filed on 07-08/04/2022, but till date, authority has not passed any order. The authority cannot be allowed to sit over the matter and leave the person to suffer suspension of registration and all consequences to follow where the entire operations are brought to suspension.

Held that:- The Hon’ble High Court directed respondent No.3 to conclude the proceedings within an outer limit of 15 days. A speaking order shall be passed in the matter, taking into consideration the reply of the petitioner including whether the proviso to Sub-Section 1 of Section 29 of the Act could be taken recourse to in the facts and circumstances of the present case. If the decision is not taken within a period of 15 days, the order of suspension of registration shall come to an automatic end.