Authority: High Court of Himachal Pradesh, Shimla (Bench of Hon'ble Mr. Justice Vivek Singh Thakur and Hon'ble Mr. Justice Ranjan Sharma)

Order Date: 08 July 2026

Case Overview

  • Petitioner: Rajat Bansal, operating M/s Shiv Trading Co., registered at SCO No. 9, Vill. Billanwalli Labana, Salasar Complex, Baddi, Solan, Himachal Pradesh.
  • Respondent: Commissioner of Central Goods & Services Tax (CGST), Shimla.
  • GST Registration: No. 02BHEPB4643Q2ZC, issued on 15 Mar 2022.
  • Show Cause Notice (SCN): Ref. No. ZA021024006405E dated 16 Oct 2024, suspending the registration.
  • Cancellation Order: Ref. No. ZA0201250071379 dated 17 Jan 2025, retrospectively cancelling the registration effective from 15 Mar 2022.
  • Petitioner’s Position: No reason was provided in the SCN or cancellation order, violating Rule 25 CGST Rules; alleged arbitrary action causing loss of business; claimed physical verification was flawed and that the premises were correctly occupied by Shiv Trading Co. as per lease agreements dated 27 Jan 2023 and 28 Aug 2024.
  • Respondent’s Position: Cancellation was part of “Project Anveshan” and a second special drive against fake GST registrations; physical verification on 16 Oct 2024 at about 12:00 P.M. found M/s Maxxon Lifesciences (GSTIN 02ABIPJ4232A1ZI) operating at the premises, no signboard of Shiv Trading Co., and neighbors confirmed non‑existence of petitioner’s business.
  • Procedural Details: Panchnama dated 16 Oct 2024 prepared with independent witnesses; photographs taken; petitioner was given opportunity to reply and to appear for personal hearing on 23 Oct 2024. Petitioner did not file a reply nor avail the statutory appeal under Rule 23 CGST Rules.

Final Outcome

  • The Court set aside the retrospective operation of the cancellation order dated 17 Jan 2025, stating that any cancellation orders issued after that date remain unaffected.
  • The matter is remitted to the Proper Officer to decide afresh whether cancellation should be effective from 15 Mar 2022 or from 17 Jan 2025.
  • Directions:
  • Petitioner must file a detailed reply with supporting documents before the Proper Officer on or before 25 July 2026.
  • The Proper Officer shall afford a hearing to the petitioner and pass a fresh, reasoned order in strict conformity with law within six weeks, i.e., on or before 05 Sept 2026.
  • The Court expressly refrained from expressing any opinion on the merits of the allegation that the business did not exist at the declared principal place of business.
  • Petition disposed; any pending applications, if any, also stand disposed.

Topics: GST Cancellation, Article 226 Writ, Tax Compliance