# M/s V.R. Enterprises, Kanpur, U.P v. Addl. Commissioner Grade-2, (Appeal)-5, State Tax, Kanpur & Anr

- **Citation:** (2024) 1 ILRA 75
- **Court:** High Court of Judicature at Allahabad
- **Decided:** 2023-12-06
- **Case number:** Writ Tax No. 1022 of 2023
- **Bench:** Ajay Bhanot
- **Source:** https://unisonlegal.in/judgment/allahabad-high-court/m-s-v-r-enterprises-kanpur-u-p-v-addl-commissioner-grade-2-appeal-5-state-tax-50957
- **Pages:** 4

## Headnote

Civil Law - The Central Goods and Services
Tax Act, 2017 - Challenge to cancellation of GST
registration by order dated 14.03.2023 and
dismissal of appeal by order dated 18.08.2023 -
Cancellation order cryptic, lacking reasons, and noncompliant with requirement for reasoned order -
Appellate authority erred in dismissing appeal as
time-barred without verifying service or date of
knowledge - Both orders set aside as unsustainable
- Matter remitted to assessing authority for fresh
consideration with show cause notice and hearing,
to be completed within two months.

List of Cases cited:

## Text

1 All. M/s V.R. Enterprises, Kanpur, U.P. Vs. Addl. Commissioner Grade-2, (Appeal)-5,
 State Tax, Kanpur & Anr.
75
appropriate decision in accordance with
law.

(49) No order as to costs.
----------
(2024) 1 ILRA 75
ORIGINAL JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 06.12.2023

BEFORE

THE HON'BLE AJAY BHANOT, J.

Writ Tax No. 1022 of 2023

M/s V.R. Enterprises, Kanpur, U.P.
 ...Petitioner
Versus
Addl. Commissioner Grade-2, (Appeal)-5,
State Tax, Kanpur & Anr. ...Respondents

Counsel for the Petitioner:
Sri Aditya Pandey

Counsel for the Respondents:
C.S.C.

Civil Law - The Central Goods and Services
Tax Act, 2017 - Challenge to cancellation of GST
registration by order dated 14.03.2023 and
dismissal of appeal by order dated 18.08.2023 -
Cancellation order cryptic, lacking reasons, and noncompliant with requirement for reasoned order -
Appellate authority erred in dismissing appeal as
time-barred without verifying service or date of
knowledge - Both orders set aside as unsustainable
- Matter remitted to assessing authority for fresh
consideration with show cause notice and hearing,
to be completed within two months.

List of Cases cited:

1. M/s Chandra Sain, Sharda Nagar, Lucknow
Thru. Its Proprietor Mr. Chandra Sain Vs U.O.I.
Thru. Secy. Ministry of Finance, New Delhi &
ors., decided on 22.09.2022.

2. M/s. Pearl and Co. Vs The Commissioner of
Commercial Taxes & anr., W.P.(MD) No.19127 of
2022 and W.M.P.(MD) No.13962 of 2022
3. Tvl. Suguna Cutpiece Vs Appellate Deputy
Commissioner (ST) (GST) & ors., W.P.Nos. 25048,
25877, 12738 of 2021 etc., decided on 31.01.2022

4. M/s Dial For Cool Vs St. of U.P. & ors., Writ Tax
No.1338 of 2022

(Delivered by Hon'ble Ajay Bhanot, J.)

1. Heard Shri Aditya Pandey, learned
counsel for the petitioner and Shri Ravi
Shankar Pandey, learned Additional Chief
Standing Counsel for the respondents-State.

2. The GST registration of the
petitioner was cancelled by order dated
14.03.2023. The appeal of the petitioner
was dismissed by the appellate authority
dated 18.08.2023.

3. The petitioner is aggrieved by the
order dated 14.03.2023 and the order dated
18.08.2023 and has assailed the same in
this writ petition.

4.
The
impugned
order
dated
14.03.2023 makes a cryptic finding to the
effect that no reply to the show cause notice
was submitted by the petitioner. The order
thereafter cancels the GST registration of
the petitioner without assigning any reason.

5. The order of cancellation of GST
registration dated 14.03.2023 visits the
petitioner with severe penal consequences.
Even if the finding that no reply to the
show cause notice was submitted is taken
on its face value, the authority has to
adhere its obligations in law to apply its
mind to the facts of this case and render a
speaking order. Failure to submit the reply
to the show cause notice does not free the
authority from its duty to apply its mind
independently to the facts in the record and
make a reasoned order while deciding the
controversy. The authority of the first
76 INDIAN LAW REPORTS ALLAHABAD SERIES
instance did not pass a reasoned order. This
Court has set its face against the order of
cancellation of GST registration by nonspeaking orders.

6. Reference can profitably be made to
the authorities in point. The judgment of this
Court rendered on 22.09.2022 in M/s
Chandra Sain, Sharda Nagar, Lucknow
Thru. Its Proprietor Mr. Chandra Sain v.
U.O.I. Thru. Secy. Ministry of Finance,
New Delhi and 5 others wherein Pankaj
Bhatia, J. held as under:

"8. In the present case from the
perusal of the order dated 13.02.2020,
clearly there is no reason ascribed to take
such a harsh action of cancellation of
registration. In view of the order being
without any application of mind, the same
does not satisfy the test of Article 14 of the
Constitution of India, as such, the impugned
order dated 13.02.2020 (Annexure - 2) is set
aside. The petition is accordingly allowed.

9. It is, however, directed that the
petitioner shall file reply to the show-cause
notice within a period of three weeks from
today. The Adjudicating Authority i.e.
Assistant Commissioner, Lucknow shall
proceed to pass fresh order after giving an
opportunity of hearing to the petitioner and
after considering whatever defence he may
take."

7. The said judgement is squarely
applicable to the facts of this case. The order
of cancellation being devoid of reasons is in
the teeth of the law laid down by this Court
in M/s Chandra Sain (supra).

8. The narrative has also the benefit of
the holding of the Madras High Court in
M/s. Pearl and Co. v. The Commissioner
of
Commercial Taxes
and another
(W.P.(MD) No.19127 of 2022 and W.M.P.
(MD) No.13962 of 2022), wherein the
consequences of cancellation of registration
of a dealer and the approach of the revenue
while considering such matters was set out
as follows:

"6.Considering the submission
and perusal of the materials, this Court is of
the view that restoring the registration
would not cause any harm to the
department on the other hand it would be
beneficial for the state to earn revenue.
Further, in the case of Tvl.Suguna Cutpiece
Vs Appellate Deputy Commissioner (ST)
(GST) and others (W.P.Nos. 25048, 25877,
12738
of
2021
etc..
batch),
dated
31.01.2022. There some of the petitioner
filed an appeal beyond the period of
limitation either for filing application for
revocation of cancellation, while some of
them had directly filed a writ petition
against the order cancelling the registration.
While some of them filed appeal beyond
the statutory period of limitation, there was
further delay in filing the writ petition.
However, considering the over all facts and
circumstances of the case, it was held that
no useful purpose will be served by
keeping those petitioners out of the Goods
and Services Tax regime, as such assessee
would still continue to do business and
supply goods/services. By not bringing
them back to the Goods and Services Tax
fold/regime, would not further the interest
of the revenue. Relief was granted under
similar circumstances with the following
directions:

"216. Since, no useful will be
served by not allowing persons like the
petitioners to revive their registration and
integrate them back into the main stream, I
am of the view that the impugned orders
are liable to be quashed and with few
safeguards.
1 All. M/s V.R. Enterprises, Kanpur, U.P. Vs. Addl. Commissioner Grade-2, (Appeal)-5,
 State Tax, Kanpur & Anr.
77

217.
There
are
adequate
safeguards under the GST enactments
which can also be pressed against these
petitioners even if their registration are
revived so that, there is no abuse by these
petitioners and there is enough deterrence
against default in either paying tax or in
complying with the procedures of filing
returns.

218. Further, the Government
requires tax to meet its expenditure. By
not bringing these petitioners within the
GST fold, unintended privilege may be
conferred on these petitioners unfairly to
not to pay GST should they end
supplying goods and/or services without
registration. For example, a person
renting out an immoveable property will
continue
to
supply
such
service
irrespective of registration or not.

219. Therefore, if such a person
is not allowed to revive the registration,
the GST will not be paid, unless of
course, the recipient is liable to pay tax
on reverse charge basis. Otherwise, also
there will be no payment of value added
tax. The ultimate goal under the GST
regime will stand defeated. Therefore,
these petitioners deserve a right to come
back into the GST fold and carry on their
trade and business in a legitimate manner.

220. The provisions of the GST
Enactments and the Rules made there
under read with various clarifications
issued
by
the
Central
Government
pursuant to the decision of the GST
Council and the Notification issued
thereunder the respective enactments also
make it clear, intention is to only
facilitate and not to debar and derecognised assesses from coming back
into the GST fold."

9. The order rejecting the appeal fails
to redeem the errors committed by the
assessing authority. The appellant authority
dismissed the appeal as being time barred.
The appellate authority by rejecting the
appeal by the order dated 18.08.2023 was
misdirected in law. The appellate authority
failed to reference the mode of service and
also did not record its satisfaction of
service of the order upon the petitioner.
The appellate authority has made no
finding regarding the date of knowledge of
the order. The impugned order is in the
teeth of the law laid down by this Court in
M/s Dial For Cool v. State of U.P. and 2
others (Writ Tax No.1338 of 2022).

10. The period of limitation shall be
reckoned only from the date of knowledge
or service of the order upon the petitioner
and not from the date the order was passed.

11. The order of the assessing
authority dated 14.03.2023 and the order
of the appellate authority dated 18.08.2023
are unsustainable in law. The orders dated
14.03.2023 and 18.08.2023 are liable to be
set aside and are set aside.

12. The matter is remitted to
assessing authority for fresh consideration.

13. The assessing authority shall
issue a show cause notice and decide the
controversy in light of the observations
made in this judgement and upon giving
an
opportunity
of
hearing
to
the
petitioner.

14. The entire exercise shall be
completed within a period of two months
from the date of receipt of a certified copy
of this order.

15. The writ petition (tax) is allowed.
----------
78 INDIAN LAW REPORTS ALLAHABAD SERIES
(2023) 1 ILRA 78
APPELLATE JURISDICTION
CRIMINAL SIDE
DATED: LUCKNOW 22.12.2023

BEFORE

THE HON'BLE KARUNESH SINGH PAWAR, J.

Criminal Appeal No. 201 of 1994
connected with
Criminal Appeals No. 182, 191 and 206- all of
1994

Mohd. Haleem & Ors. ...Appellants
Versus
State of U.P. ...Respondent

Counsel for the Appellant:
N. Mohan, A.K. Tiwari, Ayodhya Prasad
Mishra, Rashid Ahmad

Counsel for the Opposite Party:
G.A.

Criminal Law
- Narcotic Drugs
and
Psychotropic Substances Act, 1985 -
Sections 8/18, 8/21, 8/22, 42 & 57 - U.P.
Narcotic
Drugs
and
Psychotropic
Substances Rules, 1986 - Rule 77 - Code
of Criminal Procedure, 1973 - Sections
100 & 105 - Appellants challenged conviction
under NDPS Act for manufacturing morphine,
alleging procedural violations. Court held: (1)
Sub-Inspector (PW-1) was not authorized
under Section 42 of NDPS Act to conduct
search, seizure, and arrest on 03.06.1986, as
Rule
77
amendment
empowering
SubInspectors was effective only from 17.10.1989,
rendering the entire process ultra
vires
(Kamlesh Pratap Singh Vs Superintendent of
District Jail, Lucknow, Habeas Corpus Petition
No. 1323 of 1987). (2) Non-compliance with
Section 42(2) was fatal, as PW-1 failed to
reduce informer's information to writing or
forward it to a superior officer despite
sufficient
time,
violating
mandatory
requirements (Karnail Singh Vs St. of Har.,
(2009) 3 SCC (Cri) 887). (3) Link evidence was
incomplete due to discrepancies in witness
St.ments
(PW-4,
PW-5,
PW-6)
regarding
sample handling, failure to produce Malkhana
register, and absence of sample seal proof (St.
of Raj. Vs Gurmail Singh, 2005 (1) JIC 844).
(4) Lack of independent witnesses and nonproduction of alleged owner or contraband
holder further weakened prosecution's case.
Conviction set aside; appellants acquitted.
(Paras 18-38)

Criminal Appeals Allowed.

List of Cases cited:

1. Boota Singh Vs St. of Har., 2021 SCC OnLine
SC 324 (Para 24)

2. St. of Raj. Vs Babu Lal, (2009) 14 SCC 215
(Para 25)

3. Karnail Singh Vs St. of Har., (2009) 3 SCC
(Cri) 887 (Para 25)

4. Sukhdev Singh Vs St. of Har., (2013) 2 SCC
212 (Para 25)

5. Kamlesh Pratap Singh Vs Superintendent of
District Jail, Lucknow, Habeas Corpus Petition
No. 1323 of 1987 (Para 30)

6. Shyam Kumar Vs St. of U.P., 2007 SCC
OnLine All 1784 (Para 30)

7. Nandan Singh Vs The St., 2008 (3) UC 1758
(Para 31)

8. St. of Raj. Vs Gurmail Singh, 2005 (1) JIC 844
(Para 35)

9. Valsala Vs St. of Kerala, 1993 Supp (3) SCC
665 (Para 35)

(Delivered by Hon'ble Karunesh Singh
Pawar, J.)

1. Criminal appeal No.201 of 1994
and the connected criminal appeals
No.182, 191 and 206 - all of 1994, were
heard together and a common judgment is
being passed as the appeals arise out of
same sessions trial. Criminal Appeal
No.201 of 1994 is the leading case.