GST Registration Cancellation Case: Delhi High Court Ruling in Balajee Plastomers

Balajee Plastomers faced business challenges and applied for GST registration cancellation on November 28, 2019, after settling their GST liabilities.

Initial Application for Cancellation: Balajee Plastomers applied for GST registration cancellation on November 28, 2019, having cleared all GST dues.

First Rejection and Subsequent Application: The first cancellation request was rejected due to non-response to a notice dated June 15, 2020. They reapplied on July 8, 2020, effective November 28, 2019.

Second Rejection and Retrospective Cancellation: The application faced another rejection on November 5, 2020, and GST registration was retrospectively canceled from July 1, 2017.

Delhi High Court Involvement: The court found the retrospective cancellation unjustified, noting the lack of valid reasons for such an action. The impugned order failed to provide a rationale for the retrospective cancellation, only stating the absence of a reply to the Show Cause Notice (SCN).

Setting Cancellation Date: The Delhi High Court ruled that the cancellation date should be set as November 28, 2019, not July 1, 2017.

Invalid Grounds for Retrospective Cancellation: The court observed that non-filing of returns for six months could not justify cancelling the GST registration ab initio from the date it was granted.

Final Directive: The court directed that the cancellation of Balajee Plastomers' GST registration shall take effect from November 28, 2019, and not from July 1, 2017.

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