GST Registration Cannot Be Cancelled Without Giving Reasons: Gauhati High Court Quashes Non-Speaking Order
In a crucial decision reinforcing procedural safeguards, the Gauhati High Court has quashed a GST registration cancellation order that lacked clear reasoning. The ruling in Juri Bhuyan vs. Union of India & Ors. [2025 (5) TMI 383 (Gauhati HC)] underscores the necessity of issuing speaking orders and adhering to statutory formats like FORM GST REG-19 under the GST regime.
Facts of the Case
The petitioner, Juri Bhuyan, had her GST registration cancelled by the authorities due to alleged non-filing of GST returns for more than six months. Although a show-cause notice was issued, the petitioner did not respond. Subsequently, the cancellation order dated 09.09.2020 was issued by the proper officer.
However, the order failed to state any reasons, did not mention the tax dues involved, and lacked a scheduled date or time for personal hearing. Additionally, it failed to comply with the mandatory provisions outlined in FORM GST REG-19.
Core Legal Issue
The central question was whether the GST registration could be cancelled without a reasoned order, especially when the taxpayer failed to respond to the show-cause notice.
Gauhati High Court’s Ruling
The Court ruled that the cancellation order was unsustainable in law due to its non-speaking nature. It reiterated that any administrative decision impacting the rights of a taxpayer must be a speaking order—that is, it must clearly state the reasons and basis for the action taken.
The Court further held that procedural compliance with FORM GST REG-19 is not optional. An order issued without proper application of mind or without providing the taxpayer an opportunity for a fair hearing violates the principles of natural justice.
Delay in Filing Writ Petition Was Overruled
The revenue department argued that the writ petition was filed nearly four years after the order, in March 2025. However, the Court clarified that when an order suffers from a fundamental procedural illegality—such as the absence of reasoning—the delay in filing cannot override the illegality. Hence, the writ was admitted and allowed.
Key Takeaways for Taxpayers and Practitioners
1. Speaking Orders Are Mandatory
Under GST law, any cancellation of registration must be supported by clear and specific reasoning. A mechanical reference to non-filing of returns does not meet this requirement.
2. Compliance with FORM GST REG-19 Is Essential
This prescribed format must include the rationale for cancellation. Authorities cannot issue templated or blank forms without actual justification.
3. Natural Justice Overrides Procedural Delays
Even if a taxpayer fails to respond or delays legal action, the GST authorities must uphold legal fairness. Orders lacking transparency and reasoning are liable to be set aside.
4. Fair Hearing Procedure Is Non-Negotiable
Fixing a date and time for a personal hearing is a critical procedural step. It ensures the taxpayer gets a genuine opportunity to present their case.
Conclusion
The Gauhati High Court’s judgment in Juri Bhuyan vs. Union of India serves as a reminder to GST authorities that procedural compliance and natural justice cannot be compromised. While taxpayers should respond promptly to show-cause notices, the onus remains on the department to issue reasoned, lawful orders.
This ruling reinforces that cancellation of GST registration—a step with serious business implications—requires full adherence to due process under the GST Act.
The copy of the order is as under:
