Show Cause Notice Issued in Improper Form is Void

By: Admin | August 19, 2024 | Categories: Important Pronouncements | 4 Min Read

In the case of Kunhalavi N. v. State Tax Officer [W.P. (C) No. 17333 of 2024 dated June 10, 2024], the Hon’ble Kerala High Court invalidated an order for the cancellation of registration. The Court determined that a show cause notice (SCN) issued in an improper form is void. Specifically, the SCN used Form GST REG-31 instead of the required Form GST REG-17.

Case Facts

Kunhalavi N (“the Petitioner”) filed a writ petition challenging an order dated July 13, 2022 (“the Impugned Order”). The Revenue Department (“the Respondent”) issued this order based on the Petitioner’s alleged failure to file returns and to respond to the SCN. The Petitioner contended that they were unable to file a reply due to their father’s serious medical condition, which demanded their immediate attention. Additionally, the SCN issued in Form GST REG-31, rather than the mandatory Form GST REG-17, was criticized for its lack of clarity and vagueness, further complicating the Petitioner’s response.

Issue

The central issue was whether an SCN becomes void if issued in an incorrect form, deviating from the statutory requirements.

Court’s Decision

The Kerala High Court’s ruling in W.P. (C) No. 17333 of 2024 emphasized the following:

  • Statutory procedures must be followed meticulously. Any deviation from the prescribed form invalidates the legal process.
  • The use of Form GST REG-31 instead of Form GST REG-17, as mandated under Rule 22(1) of the Central Goods and Services Tax Rules (“the CGST Rules”), rendered the Impugned Order for cancelling GST registration invalid.
  • Consequently, the Court set aside the Impugned Order.
  • The Petitioner must file the overdue returns, including tax, late fees, interest, and penalties within two weeks after the Court restores their registration in accordance with this judgment.

This case highlights the importance of adhering to prescribed procedures and the potential consequences of issuing incorrect forms in legal and regulatory matters.

CLICK HERE:
https://a2zbucket.s3.apsouth1.amazonaws.com/Kunhalavi_N._High_Court_Judgement.pdf

KeralaHighCourt #GST #ShowCauseNotice #TaxCompliance #LegalPronouncements #GSTRegistration #JudicialReview #TaxLaw #TaxLitigation #CGSTRules #LegalUpdate #TaxpayerRights #FinancialRegulation

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