• Notification Date: 04-03-2023
• Notification No: N/A

Delhi HC: Cancellation of GST Registration against Koenig Solutions Confirmed

The Delhi High Court has confirmed the cancellation of GST Registration against MS Koenig Solutions Pvt Limited, the petitioner. The petitioner filed the petition, impugning the Show Cause Notice as well as the suspension of its registration under the Central Goods and Services Tax Act, 2017. The petitioner has also challenged the provisions of Sub Section (2) of Section 29 of Act and Rule 21 & Rule 21A of the Central Goods and Services Tax Rules, 2017. 

The petitioner is essentially aggrieved by cancellation of its GST registration. The respondent no. 3 issued a Show Cause Notice calling upon the petitioner to furnish a reply to the notice within seven working days from the date of service of the notice. The Show Cause Notice indicated that the concerned Authority proposed to cancel the petitioner’s registration for the following reason: “Letter from Dy. Comm. (AE-II) CGST, suspicious transaction through Innovation Software Exports Ltd.” The petitioner has challenged the said Show Cause Notice as ex facie illegal and without application of mind. Undisputedly, the implication of the suspending the petitioner’s registration has a cascading adverse effect on its business as well as business of other persons who had transacted with the petitioner. 

The present petition was first listed, and the Court passed the order that “the petitioner shall file a reply to the show cause notice within a period of two working days from today and shall appear before Mr. Chhotey Singh, GST Officer, Ward 55 on 20.01.2023 at 10.30 a.m. The concerned officer shall pass the speaking order after affording the petitioner an opportunity to be heard within a period of two working days thereafter.” Counter affidavit has been filed. The same indicates that in compliance with the order, the representative of the petitioner had filed a reply and was also afforded an opportunity to be heard. The respondent has since revoked the suspension of the petitioner’s registration and the same is active. 

The Court of Justice Vibhu Bakhru and Amit Mahajan observed that “The petitioner’s grievance insofar as suspension / cancellation of its registration is concerned, stands addressed. Since the said grievances are addressed, we do not consider it apposite to consider the challenge to Sub-Section (2) of Section 29 of Act and Rule 21 & Rule 21A of the GST Rules.”