ORDER

PER : HONOURABLE MS. JUSTICE SONIA GOKANI

This is a petition seeking to question the action of the respondent authority on the ground of non-availment of opportunity of hearing. The question also raised is of a cryptic notice and having suspended the registration on the basis of such show cause notice.

2. The prayers sought for are as follows :

8 (A) The Honourable Court pleased to issue appropriate writ/order or direction quashing and setting aside the impugned show cause notice dated 24.2.2022 (Annexure A) to this petition and /or;

(B) Pending admission and final disposal of this petition the Honourable Court may be pleased to direct the respondent authorities to grant stay in impugned show cause notice and order of suspension of registration dated 24.2.2022 (Annexure A) to this petition and also direct the authorities in the meanwhile to permit the petitioner to use GST number 24 AFAPA9339M1ZE for his business purpose and /or;

(C) Exparte ad-interim relief in terms of para (B) above may be granted in the interest of justice;

(D) Honourable Court be pleased to award the costs of this petition;

(E) Honourable Court be pleased to grant any other relief of pass any other order which the Honourable Court may consider as just and proper in the facts and circumstances of the case and in the interest of justice ;

3. This Court issued the notice on 27.7.2022 where the notice for final disposal was issued by following order :

“Heard learned advocate Mr.Chirag Prajapati for the petitioner.

2. Notice was issued for final disposal in this petition on 15.06.2022. It is directed against the show-cause notice seeking to cancel the registration of the petitioner under the Goods and Services Tax Act, 2017.

3. Learned AGP Mr.Krutik Parikh for the respondent State wants to file affidavit-in- reply. The same shall be filed on or before the next date.

4. Rule returnable on 01.09.2022.

5. Interim relief cannot be granted, since granting the interim relief would amount to allowing the main petition at this stage. Therefore, it is refused.”

4. The Affidavit-in-reply is filed by the Assistant Commissioner of State Tax, where it is not being disputed that the show cause notice was issued on 24.2.2022 and petitioner was intimated to submit the reply and explanation till 2.3.2022. However, along with the show cause notice the registration of the petitioner was suspended in order to protect the interest of the State Revenue. It was found to be availing wrongful Input Tax Credit for the year 2018-19 till 2021-22.

5. It is the case of the respondent that he has availed the Input Tax Credit, allegedly from the bogus traders, whose registration has been cancelled ab initio.

6. We have heard the learned advocate Mr. Chirag Prajapati for the petitioner and learned AGP Priyank Lodha. Learned advocate Mr. Prajapati has argued extensively and also has tendered our attention to the written submission of 8.3.2022, which has raised the issue of Jurisdiction, Constitutionality and the violation of principle of natural justice etc. He however, has added in the very breath that he is ready to contest the matter once an opportunity is given after the notice in detail is issued to the petitioner. He has relied on the decision of the Aggarwal Dyeing and Printing Works Vs State of Gujarat & Ors. 2022(4) TMI 864.

7. Learned AGP has urged that on merit the case of the petitioner is considered and that, there is no cancelation of registration but there is a suspension to protect the revenue and its interest. She has further submitted that the decision of Agrawal Dyeing (supra) was not in place when the notice impugned was issued in the month of February. Registration shall also be restored if the notice is found on reply to be sustainable.

8. Having heard both the sides and having also considered the material on record, indisputedly there is suspension of registration at the time of issuing show cause notice on 24.2.2022 where the details given are as follow :

“Show cause Notice for Cancelation of Registration

Whereas on the basis of information which has come to my notice, it appears that your registration is liable to be canceled for the following reasons :

Issues any invoice or bill without supply of goods and/or services in violation of the provisions of this Act, or the rules made thereunder leading to wrongful availment or utilisation of input tax credit or refund of tax.”

9. The petitioner was asked to appear on 2.3.2022 with a specific direction that if he fails to furnish the reply within the stipulated time period of 7 days, the case will be decided ex-parte.

10. On 8.3.2022, he has given his reply addressed to different agencies including Assistant Commissioner Range I Division II. However, there appears to be no decision thereafter as there is no personal presence of the petitioner before the authority concerned.

11. It would be apt to refer to the decision of Aggrawal Dyeing at this stage and some of the findings given by the Court :

“18. Our final conclusion are as under:

18.1. Until the Department is able to develop and upload an appropriate software in the portal which would enable the Department to feed all the necessary information and material particulars in the show cause notice as well as in the final order of cancellation of registration that may be passed, the authority concerned shall issue an appropriate show cause notice containing all the necessary details and information in a physical form and forward the same to the dealer by RPAD. In the same manner, when it comes to passing the final order, the same shall also be passed in a physical form containing all the necessary information and particulars and shall be forwarded to the dealer by RPAD.

18.2 Over a period of time, we have noticed in many matters that the impugned order cancelling the registration of a dealer travels beyond the scope of the show cause notice. Many times, the dealer is taken by surprise when he gets to read in the order that the authority has relied upon some inspection report or spot visit report etc. If the authority wants to rely upon any particular piece of evidence then it owes a duty to first bring it to the notice of the dealer so that if the dealer has anything to say in that regard, he may do so. Even if the authority wants to rely on any documentary evidence, the dealer should be first put to the notice of such documentary evidence and only thereafter, it may be looked into.

18.3 The aforesaid may appear to be very trivial issues but, it assumes importance in reducing the unnecessary litigation. Our concern is that on account of procedural lapses, the High Court should not be flooded with writ applications. The procedural aspects should be looked into by the authority concerned very scrupulously and deligently. Why unnecessarily give any dealer a chance to make a complaint before this Court when it could have been easily avoided by the department.”

12. Considering the fact that that notice itself is quite cryptic and non-sustainable, without entering into the merit following the decision, this petition would warrant interference of this decision categorically directs the authority concerned to be specific and ensure to avail opportunity of hearing. The show cause notice must contain the requisite details for the person to meet with the challenges.

13. While quashing the notice, it is being directed that the authority concerned would be permitted to issue the detailed notice and avail the opportunity of hearing to the otherside. It is ensured to this Court that such a notice would be issued in two weeks’ time, and the reply shall be filed by the petitioner and if required, personal hearing shall also be sought . The authorities concerned shall decide the same on merit on affording the best opportunity in accordance with law. This disposal will not in any manner prejudice the right of the eitherside decide for the matter to be decided on merit.

14. Resultantly this petition is allowed.