'Total Non-Application Of Mind': Delhi High Court On Dept's Rejection Of Trader's Plea For GST Cancellation, Subsequent Cancellation Order

Stating that this approach reflects a “complete non-application of the mind”, a division bench of Justices Prathiba M. Singh and Shail Jain directed the Department to adjudicate both the issues afresh. It observed,

“Clearly, the Petitioner himself wanted cancellation of its registration. However, the final order is of cancellation with retrospective effect. In the opinion of the Court both the orders passed by the GST Department show a complete non-application of the mind by the concerned officer. On the one hand, the Petitioner's application for cancellation of registration is rejected and on the other hand, an order has been passed cancelling the registration retrospectively w.e.f. 15th June 2019.”

Petitioner had filed an application for cancellation of GST registration on 30th March 2021 on the ground that he was suffering from pancreatic illness.

In response to the said application, a query was raised by the GST Department, seeking clarification on allegedly disproportionate ITC availed by the Petitioner.

As no reply was filed by the Petitioner, the Department rejected his application. However, on the same date, a Show Cause Notice was again issued for Cancellation of Registration and vide the impugned order, Petitioner's GST Registration was cancelled retrospectively.

The High Court observed it is a settled legal position that if the SCN does not contemplate retrospective cancellation, the order cannot be passed directing retrospective cancellation.

It thus set aside the impugned orders stating, “Both the application for cancellation of the registration dated 30th March, 2021 and the SCN dated 9th April 2021 deserves to be adjudicated afresh together and comprehensively by the GST Department.”

Appearance: Dr. Chakit Singhal, Mr. Anant Bhushan, Mr. Manish Bhardwaj, Mr. Sandeep Gupta & Mr. Mohit Singhal, Advs for Petitioner; Ms. Anushree Narain, SSC with Mr. Naman Choula, Adv for Respondents

Case title: Manish Goel HUF v. The Commissioner Delhi Goods And Services Tax Trade And Tax Department New Delhi And Ors.

Citation: 2025 LiveLaw (Del) 1018

Case no.: W.P.(C) 11626/2025

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