Patna High Court
M/S Medicana vs Union Of India on 2 May, 2025
Author: P. B. Bajanthri
Bench: P. B. Bajanthri
IN THE HIGH COURT OF JUDICATURE AT PATNA
Civil Writ Jurisdiction Case No.203 of 2025
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M/s Medicana a Proprietorship firm having GSTIN- 10APMPS2534L2ZQ
and its office at Jay Kamala Plaza, East Boring Canal Road, Patna, P.S.
Buddha Colony, Dist.- Patna, Bihar, 800001 through its proprietor, Poonam
Singh, Gender- Female, aged about 65 years, Wife of Sri Umesh Prasad,
Resident of Mohalla- Bihari Kunj, Makhania Kuan, Arya Kumar Road, P.S.-
Pirbahore, District- Patna, Bihar- 800004.
.. ... Petitioner/s
Versus
1. Union of India through The Secretary (Revenue), Ministry of Finance,
Government of India North Block, New Delhi- 110001.
2. The Commissioner, Central Goods and Service Tax, Patna- 1, 3rd Floor,
Kendriya Rajaswa Bhawan (Annexe Building), Bir Chand Patel Path, Patna-
800001.
3. The Principal Secretary Cum Commissioner, Department of State Taxes,
Government of Bihar, Patna.
4. The Commissioner of Central GST, Patna, Bihar.
5. The Superintendent, Central Goods and Service Tax, Patna Central-1, Patna.
... ... Respondent/s
======================================================
Appearance :
For the Petitioner/s : Mr. Bijay Kumar Gupta, Adv.
: Mr. Manish Kumar, Adv.
For the U.O.I. : Mr. Dr. K. N. Sinha, Sr. Adv., A.S.G.
: Mr. Anshuman Singh, Adv.
For the State of Bihar : Mr. Vivek Prasad, G.P. 7
======================================================
CORAM: HONOURABLE MR. JUSTICE P. B. BAJANTHRI
and
HONOURABLE MR. JUSTICE S. B. PD. SINGH
ORAL JUDGMENT
(Per: HONOURABLE MR. JUSTICE P. B. BAJANTHRI)
Date : 02-05-2025
In the instant petition petitioner has prayed for the
Patna High Court CWJC No.203 of 2025 dt.02-05-2025
2/18
following reliefs:-
"(i) the Show Cause Notice dated
13.11.2023
vide Reference No:
ZA101123031229A (as contained in
Annexure-P1) in form of REG-17/31 issued
by the Respondent No.-5 for Cancellation of
GST Registration be quashed.
(ii) The Ex parte order For Cancellation of
GST Registration dated 15.12.2023 vide
Reference No: ZA1012230354472 (as
contained in Annexure-P2) passed by the
Respondent No-5 Cancelling GST
registration of the Petitioner by non-
speaking order stating " This has
reference to show cause notice issued
dated 13/11/2023. The effective date
of cancellation of your registration is
13/11/2023 and without providing
sufficient opportunity of hearing in violation
of principles of natural justice be quashed.
(iii) For directing the Respondents to restore
the GST Registration of the Petitioner with
immediate effects as the Petitioner has
already filed GST returns properly up to
Nov, 2023 and appropriate taxes had also
been paid along with late fee and for the
remaining period from December, 2023
onwards, Petitioner was not able to upload
Patna High Court CWJC No.203 of 2025 dt.02-05-2025
monthly returns as the GST portal is not
allowing filing of return further due to
cancellation of his GST Registration w.e.f.
13.11.2023.
(iv) For granting any other relief(s) to which
the Petitioner is otherwise found entitled to
in accordance with law."
2. Petitioner is a proprietor of M/s MEDICANA which
is registered firm under the GST Act, 2017 having
GSTIN No. since July 2017. It is into the business of
selling retail medicines and its principal place of business
is at Jay Kamala Plaza, East Boring Canal Road, Patna.
Petitioner has not filed his return. Resultantly, the official
respondents proceeded to issue show cause notice for
cancellation of registration on 13.11.2023 which is stated
to have been uploaded on portal. Since there was no
response from the petitioner the official respondent
proceeded to cancel the registration by order dated
15.12.2023. The petitioner is stated to have filed belated
application for revocation of cancellation of registration
under Section 30 of CGST Act, 2017. The same was
Patna High Court CWJC No.203 of 2025 dt.02-05-2025
not materialized resultantly he has invoked the remedy
before this Court without exhausting statutory remedy
under Section 107 of CGST Act, 2017 before the
commissioner of appeal. Hence the present writ petition.
3. Learned counsel for the petitioner submitted that
petitioner did not exhaust statutory remedy of appeal
under Section 107 of CGST Act, 2017 on the issue
that show cause notice was not communicated to the
petitioner. It was only uploaded in portal. Further there
are defects in the show cause notice to the effect that
petitioner was required to furnish his reply to the notice
within 30 days from the date of service of notice. Notice
is dated 13.11.2023 and it has not been served on the
petitioner other than uploaded in portal. Assuming that it
was uploaded on 13.11.2023, 30 days lapses on
12.12.2023. Therefore, notice cannot indicate for
personal appearance of the petitioner on 11.12.2023 at
11:00 A.M. It was further pointed out that if the
petitioner failed to furnish reply within stipulated date or
Patna High Court CWJC No.203 of 2025 dt.02-05-2025
failed to appear for personal hearing on the appointed
date and time the case will be decided ex-parte on the
basis of available records and on merits. In the order of
cancellation of registration there is no iota of material
insofar as taking note of available records and on merits.
There is not even reference to the date of communication
of notice dated 13.11.2023 to the extent on what date it
was uploaded in the portal. Further petitioner failed to
submit his reply to the show cause notice and so also
failed to appear before the concerned authority on the
date fixed on 11.12.2023.
4. In support of the non speaking order, petitioner
relied on Annexure P/4, P7, P8. Having regard to the fact
that the aforementioned defects are forthcoming in the
impugned show cause notice and order of cancellation of
registration, the petitioner need not to be relegated to the
appellant authority under Section 107. Having regard to
the fact that there is a violation of principles of natural
justice he need not exhaust statutory remedy of appeal
Patna High Court CWJC No.203 of 2025 dt.02-05-2025
before the appellate authority in the light of M/s Godrej
Sara Lee Ltd. vs. the Excise and Taxation Officer-cum-
Assessing Authority and Ors. reported in 2023 SCC
OnLine SC 95.
5. It is further submitted that impugned action of
the respondent violates article 19(1)(g) of Constitution.
In support of the same, he relied on Division Bench
decision of the Bombay High Court in the case of Rohit
Enterprises vs. the commissioner and others vide
annexure P/6 (para 9). It is also submitted that official
respondents are exercising quasi judicial function under
Section 29. In that event they are bound by certain
principles laid down by the Hon'ble Supreme Court in the
case of M/s. Kranti Associates Pvt. Ltd. & Anr. v.
Masood Ahmed Khan & Ors, reported in (2010) 9
SCC 496. Para 47
6. The learned counsel for the petitioner
submitted that in this backdrop he proceeded to file
returns belatedly, the same was not accepted by the
Patna High Court CWJC No.203 of 2025 dt.02-05-2025
system only on the score of delay. On this counts, the
impugned action of the respondents are liable to be set
aside and writ petition is to be allowed.
7. Per contra learned counsel for the respondent
resisted the aforementioned contentions and submitted
that show cause notice dated 13.11.2023 was uploaded
in the portal, therefore, it was bounden duty of the
petitioner to draw an inference that he had the knowledge
and he failed to submit his reply and so also he has failed
to appear on 11.12.2023 at 11:00 AM. Resultantly, order
of cancellation of registration has been passed.
8. Learned counsel for the respondent submitted
that writ petition could be dismissed on the ground of
delay since petitioner has not exhausted the remedy of
appeal under Section 107. In support of said contention
he relied on co-ordinate bench decision passed in
C.W.J.C. No. 82 of 2023 decided on 28.04.2023 and its
affirmation by the Hon'ble Supreme Court on 04.08.2023
in Special Leave to Appeal (C) No. (S) 15594 of 2023.
Patna High Court CWJC No.203 of 2025 dt.02-05-2025
9. Having regard to the conduct of the petitioner,
he did not open his eyes as and when cause of action
accrued to the petitioner insofar as filing of return within
stipulated period. He cannot take undue advantage of
approaching in assailing the show cause notice and order.
10. Heard the learned counsel for the respective
parties undisputed facts are that the petitioner is a dealer
in selling of retail medicines and he has registration of
GST since July, 2017. He has failed to furnish returns in
the year 2023, resulted in issuance of show cause notice
on 13.11.2023 and followed by order for cancellation of
registration on 15.12.2023. It is necessary to reproduce
both show cause notice for cancellation of registration and
order of cancellation of registration. They are as under:-
" Show Cause Notice for Cancellation of
Registration
Whereas on the basis of information
which has come to my notice, it appears that
your registration is liable to be cancelled for
the following reasons:
1. returns furnished by you under section 39
Patna High Court CWJC No.203 of 2025 dt.02-05-2025
of the Central Goods and Services Tax
Act,2017
Observations
Failure to furnish returns for a continuous
period of six months
You are hereby directed to furnish a
reply to the notice within thirty days from the
date of service of this notice.
You are hereby directed to appear before
the undersigned on 11/12/2023 at 11:00
If you fail to furnish a reply within the
stipulated date or fail to appear for personal
hearing on the appointed date and time, the
case will be decided ex parte on the basis of
available records and on merits.
Please note that your registration
stands suspended with effect from
13/11/2023"
" Order for Cancellation Of Registration
This has reference to show cause notice
issued dated 13/11/2023.
The effective date of cancellation of your
registration is 13/11/2023.
Patna High Court CWJC No.203 of 2025 dt.02-05-2025
3. It may be noted that a registered
person furnishing return under sub-section
(1) of Section 39 of the CGST Act, 2017 is
required to furnish a final return in FORM
GSTAR-10 within three months of the date
of this order.
4. You are required to furnish all your
pending returns.
5. It may be noted that the cancellation of
registration shall not affect the liability to pay
tax and other dues under this Act or to
discharge any obligation under this Act or the
rules made thereunder for any period prior to
the date of cancellation whether or not such
tax and other dues are determined before or
after the date of cancellation."
Perusal of the aforementioned documents, it is
evident that show cause notice dated 13.11.2023 was
uploaded in portal. It has a civil consequences in taking
away certain rights with reference to Article 19(1)(g) of
the Constitution. Therefore, it was duty on the part of the
Patna High Court CWJC No.203 of 2025 dt.02-05-2025
official respondent in communicating the show cause
notice in more than one mode. The same has not been
exercised by the concerned authority, that apart there are
defects in the show cause notice to the extent that
petitioner was asked to submit his reply within 30 days
from the date of service of the notice dated 13.11.2023,
assuming that 13.11.2023 notice was uploaded in the
portal on 13.11.2023 itself, 30 days lapses on
12.12.2023. On the other hand, petitioner was asked to
appear before the author of the show cause notice on
11.12.2023 at 11:00 AM. Therefore, there is no
breathing time insofar as appearance after service of
notice. Further, it is to be notice that it has been uploaded
only in portal. Notice should have been communicated
through registered post under acknowledgment, having
regard to the fact that it has a civil consequences to the
petitioner. Order for cancellation of registration dated
15.12.2023 is a dearth of material information and on
merits, for the reasons that in the show cause notice
Patna High Court CWJC No.203 of 2025 dt.02-05-2025
dated 13.11.2023 the author of the notice has indicated
as under
"if you failed to a furnish reply within
stipulated date or failed to appear for personal
hearing on the appointed date and time, the case
will be decided ex-parte on the basis of available
records and on merits".
The ingredient of available records and on merits or not
forthcoming in the order for cancellation of registration. It
is to be noted in the order for cancellation of registration
there is not even write up that the petitioner has failed to
avail submission of his reply to the show cause notice and
so also failed to appear in person on 11.12.2023. On this
count, the order for cancellation of registration is dearth
of material information and it is not a speaking order. It is
to be noted that order for cancellation of registration is
while invoking Section 29 of CGST Act, 2017 which is
quasi judicial function exercised by the Superintendent,
Patna Central. In such circumstances, he was bounden
duty to follow the principle laid down by the Hon'ble
Patna High Court CWJC No.203 of 2025 dt.02-05-2025
Supreme Court in the case of M/s. Kranti Associates
Pvt. Ltd. & Anr. v. Masood Ahmed Khan & Ors,
reported in (2010) 9 SCC 496. Para 47 reads as
under:-
"47. Summarising the above discussion, this
Court holds:
(a) In India the judicial trend has always
been to record reasons, even in
administrative decisions, if such decisions
affect anyone prejudicially.
(b) A quasi-judicial authority must record
reasons in support of its conclusions.
(c) Insistence on recording of reasons is
meant to serve the wider principle of justice
that justice must not only be done it must
also appear to be done as well.
(d) Recording of reasons also operates as
a valid restraint on any possible arbitrary
exercise of judicial and quasi-judicial or even
administrative power.
(e) Reasons reassure that discretion has
been exercised by the decision-maker on
relevant grounds and by disregarding
extraneous considerations.
(f) Reasons have virtually become as
indispensable a component of a decision-
making process as observing principles of
natural justice by judicial, quasi-judicial and
even by administrative bodies.
(g) Reasons facilitate the process of
Patna High Court CWJC No.203 of 2025 dt.02-05-2025
judicial review by superior courts.
(h) The ongoing judicial trend in all
countries committed to rule of law and
constitutional governance is in favour of
reasoned decisions based on relevant facts.
This is virtually the lifeblood of judicial
decision-making justifying the principle that
reason is the soul of justice.
(i) Judicial or even quasi-judicial opinions
these days can be as different as the judges
and authorities who deliver them. All these
decisions serve one common purpose which
is to demonstrate by reason that the relevant
factors have been objectively considered.
This is important for sustaining the litigants'
faith in the justice delivery system.
(j) Insistence on reason is a requirement
for both judicial accountability and
transparency.
(k) If a judge or a quasi-judicial authority
is not candid enough about his/her decision-
making process then it is impossible to know
whether the person deciding is faithful to the
doctrine of precedent or to principles of
incrementalism.
(l) Reasons in support of decisions must
be cogent, clear and succinct. A pretence of
reasons or "rubber-stamp reasons" is not to
be equated with a valid decision-making
process.
(m ) It cannot be doubted that
transparency is the sine qua non of restraint
on abuse of judicial powers. Transparency in
decision-making not only makes the judges
Patna High Court CWJC No.203 of 2025 dt.02-05-2025
and decision-makers less prone to errors but
also makes them subject to broader scrutiny.
(See David Shapiro in Defence of Judicial
Candor [(1987) 100 Harvard Law Review
731-37] .)
(n) Since the requirement to record
reasons emanates from the broad doctrine of
fairness in decision-making, the said
requirement is now virtually a component of
human rights and was considered part of
Strasbourg Jurisprudence. See Ruiz
Torija v. Spain [(1994) 19 EHRR 553]
EHRR, at 562 para 29
and Anya v. University of Oxford [2001
EWCA Civ 405 (CA)] , wherein the Court
referred to Article 6 of the European
Convention of Human Rights which requires,
"adequate and intelligent reasons must be
given for judicial decisions".
(o) In all common law jurisdictions
judgments play a vital role in setting up
precedents for the future. Therefore, for
development of law, requirement of giving
reasons for the decision is of the essence and
is virtually a part of "due process".
12. The learned counsel for the petitioner relied on
Annexure P/4, P/7 and P/8 on the issue of non speaking
order insofar as cancellation of registration which is aptly
applicable to the case in hand.
Patna High Court CWJC No.203 of 2025 dt.02-05-2025
13. The learned counsel for the respondent
submitted that having regard to the conduct of the
petitioner in not approaching the appellate authority and
approaching this Court in the year 2024, he has slept
over his right, on this issue he relied on decision in the
case of Ms. Vishwananth Traders (supra). The
aforementioned decision is not applicable to the case in
hand for the reasons that the Vishwanath Traders case
is considered that petitioner therein had invoked a
remedy under Section 107 insofar as filing belated
memorandum of appeal, whereas in the present case
petitioner has not invoked remedy under Section 107 of
CGST Act, 2017, obviously for the reasons that
impugned show cause notice and cancellation of
registration order is in violation of principle of natural
justice. Under what circumstances Writ Court can by pass
the statutory remedy of appeal by the concerned
aggrieved person has been explained in detail in case of
Godrej (supra). One of the principle is violation of
Patna High Court CWJC No.203 of 2025 dt.02-05-2025
principle of natural justice. Therefore, the petitioner need
not exhaust remedy of appeal before the appellate
authority under Section 107. It is to be noted that
violation of principle of natural justice would go to the
root of the matter. That apart, cancellation of registration
has a civil consequences including violation of Article
19(1)(g) of the Constitution. On this issue, the Hon'ble
supreme Court insofar as blacklisting contractor for 10
years it was noticed that there would be a violation of
Article 19(1)(g) insofar as taking away his right to
participate in public contract. Taking note of this principle,
the petitioner has made out a case so as to interfere with
the impugned show cause notice and order dated
13.11.2023 and 15.12.2023. They are set aside while
restoring the registration of the petitioner. The concerned
authority is hereby directed to accept belated returns in
the interest of revenue and proceed to complete the
formalities on receipt of returns. The above exercise shall
be completed within a period of three months from the
Patna High Court CWJC No.203 of 2025 dt.02-05-2025
date of receipt of this order.
14. The present C.W.J.C. No. 203 of 2025
stands allowed.
(P. B. Bajanthri, J)
( S. B. Pd. Singh, J)
Nirajkrs/Prabhak
ar/-
AFR/NAFR NAFR
CAV DATE NA
Uploading Date 16.05.2025
Transmission Date NA
