In a significant ruling the Punjab and Haryana High Court ruled that the suspension of GST registration is deemed to be revoked if the show cause notice (SCN) is not decided within 30 days of reply. The counsel for the petitioner submitted that the matter comes up today in terms of order dated 15.03.2024 passed by this Court wherein we directed the respondents to file short affidavit giving out reasons for not deciding the issue within 30 days’ period as prescribed under Section 22(3) of the CGST/PGST Rules, 2017 (Rules).

The respondents, while issuing the said show cause notice, had suspended the registration of petitioner w.e.f. 21.11.2023, and in terms of the reply filed by the petitioner, the respondents were required to decide the show cause notice and objections raised by the petitioner within a period of 30 days in terms of the Rule 22 (3) of the Rules which empowers the respondents to either cancel the registration w.e.f. the date or decide the same otherwise within 30 days. A Division Bench of Justices Sajeev Prakash Sharma and Sudeepti Sharma observed that

“However, it is apparent that more than 30 days have elapsed and no decision has been taken by the respondents on the show cause notice, while the petitioner suffers suspension of Registration for almost four months, we find that as per the provisions of Rule 21-A Sub-clause (4) of the Rules, the suspension of registration of the petitioner would be deemed to be revoked upon completion of the proceedings under Rule 22 of the Rules, but the proceedings were not completed within 30 days.” “Thus, prima facie, we find that the suspension of the petitioner would deserve to be revoked. Accordingly, we pass orders that the suspension of the petitioner w.e.f. 21.11.2023 shall stand revoked” the Court concluded.