While emphasizing that the proviso to Section 29(2) of the Goods and Services Tax Act (GST Act) mandates that the proper officer must grant an opportunity of being heard before cancelling a GST registration, the Kerala High Court ruled that said requirement holds true even when there is a change of officer handling the matter.

A Single Judge Bench of Justice T.R. Ravi observed that “Under Section 29(2) of the GST Act, the proviso also mentions that the proper Officer shall not cancel the registration without giving an opportunity of being heard, which is in the nature of an embargo on the officer”.

The ruling came as a relief for M/s. Ajit Associates Architectural Consultants Pvt. Ltd. (petitioner), who had filed the present petition challenging the cancellation of their GST registration.

Advocate Harisankar V. Menon appeared for the Petitioner, whereas Advocate Thushara James appeared for the Respondent.

Briefly, the Petitioner had argued that the cancellation order was issued without affording them a chance for a hearing, and pointed out that a show cause notice had been issued earlier by a different assessing authority, and the subsequent cancellation order was issued by a different officer without providing them the opportunity to present their case.

After considering the submission, the Bench highlighted that Section 29(2) of the GST Act includes a proviso stipulating that the cancellation of registration should not occur without affording the opportunity for a hearing, and this provision acts as a restriction on the officer's actions.

The Bench also highlighted that the use of the term ‘proper officer’ in the proviso emphasizes the requirement that both the original and succeeding officers must provide the concerned person with notice and an opportunity to be heard.

This implies that the proper officer, including the succeeding officer, is obligated, to put the assessee on notice, before cancelling their registration, added the Bench.

Accordingly, the High Court granted the relief sought by the petitioner, observing that the petitioner had already submitted returns for the relevant periods.

Hence, the High Court directed the Revenue Department to issue the necessary orders, treating the petitioner's registration as not cancelled.

Cause Title: Ajit Associates Architectural Consultants v. Assistant Commissioner, Second Circle, State GST Department and Ors. [Neutral Citation: 2023: KER: 43737]

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Kerala High CourtJustice T.R Ravi

Pankaj Bajpai