Punjab & Haryana High Court Set’s aside GST Cancellation for Ignoring Taxpayer’s Reply

The Punjab & Haryana High Court threw out a GST cancellation order after finding that officials ignored the petitioner’s reply to a show cause notice. The court called out the “non-application of mind” by the department and said they could start the process again but only if they actually read and consider the reply this time.

Fact of the Case

Rafik Mohammad got a show cause notice on 12.02.2026 about canceling his GST registration. He did what you’re supposed to do submitted a written response.  And the reponse did not matter. When the final order arrived on 18.03.2026, the authority cancelled his registration, bluntly stating he hadn’t replied at all.

Issue of the case

Can the department really cancel GST registration when they ignore a valid reply and act as if nothing were filed?

Judgment

The Court said Rafik did respond to the notice, but the department just missed it. Ignoring a reply is not just sloppy; it goes against the basic rules of natural justice.

In the end, the High Court set aside the cancellation order dated 18.03.2026 because the officials had not actually considered Rafik’s response. The Court did leave the door open for the authorities to start fresh proceedings if they were willing to do it by the book and take the reply into account. Rafik’s petition was allowed, and there were no costs awarded.

Key highlight of the judgement

The court pointed out that cancelling someone’s GST registration without looking at their reply is not just unfair; it shows the authority did not really think things through.