The Hon’ble High Court of Allahabad vide its order dated 06.09.2022 in the matter of Om Prakash Mishra Vs. State of U.P. Thru Secy. Revenue, LKO and Others in Writ Tax No. 100 of 2022, finding that the order passed fails to satisfy the test of a judicial order and is in violation of Article 14 of the Constitution, set aside the said order passed without mentioning any reason for cancellation of the registration of the assessee.

The Petitioner filed the writ petition before the Hon’ble High Court challenging the order dated 15.03.2019, whereby the registration of the petitioner's firm has been cancelled in view of the exercise of the power under section 29 of the CGST Act as well as the appellate order dated 29.03.2022, whereby the petitioner’s appeal has been dismissed as being beyond the period prescribed for filing of appeal under section 107(4) of the CGST Act.

Petitioner’s Submissions: –

• It was argued on the behalf of the petitioner that the order cancelling the registration was passed without issuance of any show cause notice. Further Section 29 mandates passing of an order after providing the opportunity of hearing, which has not been done in the present case.  Moreover, the order records that ‘no one has appeared for hearing’, and even otherwise the order passed is arbitrary and without application of mind.
• It was submitted that the reasoning is ‘heart and soul of any administrative and quasi- judicial order’, which is absent in the order dated 15.03.2019.
• The appeal filed by the petitioner was beyond the prescribed period of limitation as the wife of the petitioner suffered a heart attack, and later within a week, the petitioner also suffered a heart attack and were undergoing medical treatment.  The Medical certificates to that effect are on record and part of the writ petition.
• Further the authorized representative of the petitioner, who was in possession of all the papers & documents with respect to the registration of the petitioner, unfortunately died without providing any information about the case of the petitioner. The death certificate is on record.
• It was also submitted that power to condone the delay is prescribed under Section 107 (4) of the Act, which cannot be done beyond one month after three months prescribed for filing of the appeal. Therefore, it was insisted on behalf of the petitioner to consider the order dated 15.03.2019 for judicial review being passed in violation of principles of natural justice, and also for the reason that the appellate order dismissing the appeal as being beyond limitation cannot be argued.
• It was incumbent upon the respondent authority to provide hearing and to record reason for passing of the order, and the same is absent in the order dated 15.03.2019.

On the other hand, it was submitted on the behalf of the respondents that it is evident from the order dated 15.03.2019 that no reply to show cause notice was filed, even the hearing was not attended and the authority duly complied with principles of natural justice.  The authority concerned made all efforts for compliance, which the petitioner did not avail and even the appeal was filed beyond the prescribed period of limitation.  Hence, the writ petition deserves to be dismissed.

Held: –

• The Hon’ble Court after considering the submissions made and the facts of the case, found that the appellate tribunal has not been constituted yet as prescribed under the Act, therefore, this court is to consider the validity of both the orders under challenge.
• The Hon’ble Court not agreeing with the submissions made on the behalf of the petitioner with respect to the appellate order dated 29.03.2022, found that the submissions with regard to the order dated 15.03.2019 can be accepted, as it is quite evident from the perusal of the order dated 15.03.2019 that no reasons whatsoever have been recorded while passing the order of cancellation of the registration of the petitioner's firm. The order clearly being without any reason cannot be accepted to be an order in accordance with law.
• Further, it was found by the Hon’ble Court that it is essential that every administrative authority or a quasi-judicial authority should indicate the reasons, regardless of how brief they may be before passing an order of the nature which has been done by the authority.
• The passing of order dated 15.03.2019 has a very harsh consequences and the same being without any reason whatsoever, fails to satisfy the test of a judicial order and is in violation of Article 14 of the Constitution of India.

The Hon’ble Court with the above findings allowed the writ petition by setting aside the order dated 15.03.2019, with the directions to the petitioner to file a reply to the show cause notice before the respondent authority, who shall pass fresh order after providing opportunity of hearing to the petitioner.  The petitioner would be at liberty to place whatever documents he pleases to rely upon in support of his defence. In view of the fact that the order dated 15.03.2019 is set aside, the appellate order, although not interfered with, is also set aside.