Smt. Shobha Vs the Superintendent, RANGE-BND8 — GST and Indirect Tax | Karnataka HC (2025)

Smt. Shobha Vs the Superintendent, RANGE-BND8 — GST and Indirect Tax | Karnataka HC (2025)

What the court decided

AI extract

Outcome

Petition allowed in part: the respondent's cancellation order dated 20.12.2024 (Annexure-C) is quashed and the GST registration restored; proceedings stand restored to the stage of the petitioner's response to the show cause notice dated 28.11.2024; the respondent shall communicate the reason for commencement of the proceedings within two weeks (posted on the portal); the petitioner may file a written response within 15 days thereof and shall file all returns within a week of the restoration.

Issue for consideration

Whether the show cause notice dated 28.11.2024, which alleges that the petitioner obtained GST registration by fraud, willful misrepresentation and suppression of facts without offering any reason for that initial opinion or referring to any documents, is amenable to interference. +1 more

Court's answer

If cancellation of registration is initiated on the ground of fraud, willful misrepresentation or suppression of facts, the noticee must be informed of the reasons for framing that initial opinion; the impugned show cause notice alleged fraud without elaboration, which is the first ground for interference.

Ratio / Principle

The absence of details or reasons in the order of cancellation of registration itself is the second ground for interference.

Key takeaways

Interference is confined to the order of cancellation dated 20.12.2024, with liberty to the respondent to issue reasons complementing the show cause notice dated 28.11.2024.ratio¶4
Upon restoration, the petitioner is at liberty to file a response to the show cause notice and, as a condition of the interference, must file all returns as of date once the portal is opened.ratio¶4

Detailed headnote1 paragraphs

GST registration cancellation — writ under Articles 226 and 227 of the Constitution. A Form GST REG-17 show cause notice dated 28.11.2024 (Annexure-B, ref ZA2911242361825) alleged that the petitioner-proprietor had obtained registration by fraud, willful misrepresentation and suppression of facts without stating any reason or referring to documents, and the cancellation order dated 20.12.2024 (Annexure-C, ref ZA291224109005Y) likewise assigned no reasons. Held (B M Shyam Prasad J): a noticee facing cancellation on grounds of fraud, willful misrepresentation or suppression of facts must be informed of the reasons for that initial opinion, and the cancellation order must itself set out the details — each an independent ground for interference. Interference confined to quashing the cancellation order; proceedings restored to the stage of reply to the show cause notice; respondent to communicate reasons within two weeks; petitioner to respond within 15 days and file all returns within a week, the registration standing restored. Petition allowed in part.

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NC: 2025:KHC:19172 WP No. 12405 of 2025

HC-KAR

IN TE HIGH COURT OF KARNATAKA AT BENGALURU

DATED THIS THE 6^TH DAY OF JUNE, 2025

BEFORE

THE HON'BLE MR JUSTICE B M SHYAM PRASAD

WRIT PETITION NO. 12405 OF 2025 (T-RES)

BETWEEN:

SMT. SHOBHA (INDIVIDUAL AGED ABOUT 38 YEARS) PROPRIETOR OF PARAMESHWARI DISTRIBUTOR GST REGISTRATION NUMBER 29KJPPS6045M1ZZ 210, GROUND FLOOR, 6^TH MAIN ROAD, KASHI NAGAR NEAR GANESHA TEMPLE, YALANCHENAHALLI BENGALURU, KARNATAKA 560078.

Digitally signed by VANAMALA N Location: High Court of Karnataka

…PETITIONER

(BY SRI. SANTOSH SAGAR KAPILAVAI.,ADVOCATE)

AND:

THE SUPERINTENDENT, RANGE-BND8 BENGALURU NORTH GST COMMISSIONERATE NO. 59, GROUND FLOOR, HMT BHAVAN, BELLARY ROAD BENGALURU, KARNATAKA - 560032.

…RESPONDENT

(BY SRI.ARAVIND V CHAVAN., ADVOCATE)

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THIS WP IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH BY AN ORDER WRIT OR DIRECTION IN THE NATURE OF CERTIORARI THE ORDER SHOW CAUSE NOTICE IN FORM GST REG-17 BEARING REFERENCE NUMBER REFERENCE NO. ZA2911242361825 DATED 28.11.2024 ISSUED BY THE RESPONDENT IN ANNEXURE B AS UNLAWFUL ILLEGAL VAGUE ARBITRARY WITHOUT JURISDICTION AND ULTRA VIRES THE PROVISIONS OF THE CENTRAL GOODS AND SERVICES TAX ACT 2017 ALONG WITH ALL ATTENDANT AND CONSEQUENTIAL ACTIONS; QUASH BY AN ORDER WRIT OR DIRECTION IN THE NATURE OF CERTIORARI THE GST CANCELLATION ORDER BEARING REFERENCE NUMBER ZA291224109005Y AND APPLICATION REFERENCE NUMBER (ARN) AA291124079916R DATED 20.12.2024 ISSUED BY THE RESPONDENT IN ANNEXURE C AS UNLAWFUL ILLEGAL VAGUE ARBITRARY WITHOUT JURISDICTION AND ULTRA VIRES THE PROVISIONS OF THE CENTRAL GOODS AND SERVICES TAX ACT 2017 ALONG WITH ALL ATTENDANT AND CONSEQUENTIAL ACTIONS.

THIS PETITION, COMING ON FOR PRELIMINARY HEARING, THIS DAY, ORDER WAS MADE THEREIN AS UNDER: CORAM: HON'BLE MR JUSTICE B M SHYAM PRASAD

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ORAL ORDER

The petitioner, an individual who is engaged in the business of trading in plywood, laminated wood and allied products, is aggrieved by the respondent's Order dated 20.12.2024 for cancellation of GST Registration [Annexure-C] . The petitioner has also called in question the Show Cause Notice dated 28.11.2024 [Annexure-B]. The petitioner, setting up the premise for bona fides, asserts that she was not aware of the Show Cause Notice or the Order of Cancellation of Registration which is uploaded electronically on the GST portal and not served otherwise, and that she was in business, as of the date of the notice, only for just over a year.

Sri Santosh S K, the learned counsel for the petitioner relying upon these assertions as also the assertion that the petitioner is not computer literate, submits that this Court must interfere with the Show Cause Notice because though it is alleged

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that the petitioner has got registration by fraud, willful misrepresentation and suppression of facts, the respondent has offered no reason for such initial opinion, and in this regard, the learned counsel invites this Court's attention to the Show Cause Notice mentioning that no documents are referred. The learned counsel also emphasizes that even in the Order of Cancellation of Registration, there is no reason assigned. When queried on the status of the business, the learned counsel is categorical that the business has not been effective, but if the petitioner succeeds, she will upload all the details of the period beginning from the Order of Cancellation.

Sri Aravind V Chavan, the learned counsel

for the respondent, is heard in the light of these submissions, and on perusal of the records. Indeed, this Court must observe that the Show Cause Notice though mentions that the petitioner has got the Registration by playing fraud, by willful

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misrepresentation and by suppression of facts, does

not elaborate any further. This Court has no hesitation in opining that if action such as cancellation of the registration on the ground of fraud, willful misrepresentation or suppression of facts is started, the Noticee must be informed about the reasons to frame such an opinion. This would be the first reason for interference, and the second reason would be that the details are not set forth even in the Order for Cancellation of Registration.

Consequent to this Court's interference,

the petitioner would be entitled to certain benefit, and both Sri Santosh S K and Sri Aravind V Chavan are heard on this aspect as well. This Court is of the considered view that the interference must be confined to the Order of Cancellation dated 20.12.2024 [Annexure-C] with liberty to the respondent to issue reasons to complement the impugned Show Cause Notice dated 28.11.2024 with

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liberty to the petitioner to file response and on the condition that the petitioner, with this Court's interference with the Order for Cancellation of Registration and on opening of the portal must file all Returns as of date. In the light of the afore, the following:

ORDER

[a] The petition is allowed in part, and the

respondent's Order dated 20.12.2024 [Annexure-C] is quashed restoring the proceedings to be continued from the stage of petitioner’s response to the Show Cause Notice dated 28.11.2024 but with the stipulation that the respondent shall communicate to the petitioner, within two weeks from today, the reason for commencement of the proceedings under the Show Cause Notice.

[b] The petitioner, upon receipt of such reasons with the same being posted on

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the portal, shall be at liberty to file response in writing within fifteen [15] days thereof. The petitioner consequent to the restoration of the registration in terms of this Order shall file all Returns within a week.

Sd/(B M SHYAM PRASAD) JUDGE

AN/-