In the Calcutta High Court, if the registration of a dealer is cancelled, the dealer does not continue its business in the term of no invoice can be raised via the dealer. The same rendered an impact on the tax recovery.
The division bench of Justice T.S. Sivagnanam and Justice Prasenjit Biswas ruled that the revocation of the suspension of the appellant’s registration must be done immediately from the direction of the appropriate authority to issue a show cause notice in the given time and take up the adjudication proceeding.
A writ petition challenging a show cause notice for cancellation of GST registration granted to the appellant has been furnished by the petitioner. It is on the basis of the show cause notice was challenged that there would be no final order of the adjudication issued via the competent authority quantifying the tax subjected to be paid via petitioner. The outcome is that the reason to cancel the registration on the alleged basis of not being able to furnish the tax and penalty does not arrive.
In the stay application, a bundle of documents has been captured which specifies that from 10th January 2020, the Anti-Evasion Wing and the Audit Department repeated summons would be provided via the authorities on different dates.
The petitioner said that to date there is no show cause notice provided to him either via the Anti-Evasion Wing or the Audit Department of the respondent department. If the same is the case then the computation of the liability has not yet been done. Computation of the liability comes post to providing the show cause notice and complying with the function of adjudication.
The petitioner, there is no idea why the department is extending the case for a longer duration without a logical conclusion. The case could come to its closure when the show cause notice is given via the specific authority and the adjudication would be taken out via the competent authority.
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“In our view, suspension of a license of a dealer will be counter-productive and would work against the interest of the revenue,” the court articulated.
The court established that the summons was being provided multiple times to the petitioner and the petitioner answering to the summons by furnishing representations to the department. The same is not evident why the authorities did not move further according to the summons.
The court renders the department to provide a reasonable time to the petitioner for his protest against the show cause notice. Hence the show cause notice will be adjudicated and a reasoned order would be issued on the basis of excellence and as per the law.
