M/S NORTH STEEL INDIA v. UNION OF INDIA AND OTHERS
Court: High Court of Punjab and Haryana
Bench: MR. JUSTICE DEEPAK SIBAL,MS. JUSTICE LAPITA BANERJI
Judgment date:
Case summary
High Court of Punjab and Haryana judgment dated 2026-04-30. M/S NORTH STEEL INDIA v. UNION OF INDIA AND OTHERS. Read the judgment and case details on...
Judgment text
Sr. No. 145 IN THE HIGH COURT OF PUNJAB AND HARYANA ATIN THE HIGH COURT OF PUNJAB AND HARYANA ATIN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARHCHANDIGARH CWP-88818881-2026 (O&M) Date of Decision :Date of Decision : 30. 04. 2026 M/s North Steel IndiaM/s North Steel India …Petitioner Versus Union of India and othersUnion of India and others …Respondents CORAM : HON’BLE MR. JUSTICEHON’BLE MR. JUSTICE DEEPAK SIBALDEEPAK SIBAL HON’BLE MS. JUSTICE LAPITA BANERJIHON’BLE MS. JUSTICE LAPITA BANERJIHON’BLE MS. JUSTICE LAPITA BANERJI Present : Mr. Ish Puneet Singh, Advocate,Mr. Ish Puneet Singh, Advocate, for the petitioner. for the petitioner. Mr. Rishabh Kapoor, Advocate,Mr. Rishabh Kapoor, Advocate, for respondentsfor respondents No. 1 to 4. Mr. Saurabh Kapoor, Additional A. G. , PunjabMr. Saurabh Kapoor, Additional A. G. , PunjabMr. Saurabh Kapoor, Additional A. G. , Punjab and Ms. Muskaan Gupta, Advocate,Ms. Muskaan Gupta, Advocate, for respondents No. 5 to 8. for respondents No.
5 to 8. *** DEEPAK SIBALDEEPAK SIBAL, J. (Oral) Learned counsel for the petitioner restricts his claim to theLearned counsel for the petitioner restricts his claim to theLearned counsel for the petitioner restricts his claim to the challenge to the show cause noticechallenge to the show cause notice dated 05. 01. 2026 served upon thedated 05. 01. 2026 served upon the petitioner with regard topetitioner with regard to cancellation of its GST registration. cancellation of its GST registration. 2. The impugned show cause notice dated 05. 01. 2026 reads asThe impugned show cause notice dated 05. 01. 2026 reads asThe impugned show cause notice dated 05. 01. 2026 reads as under:- “FORM GST REGFORM GST REG-17 [See Rule 22(1)][See Rule 22(1)] Reference No. : ZA030126007296ZReference No. : ZA030126007296ZReference No.
: ZA030126007296Z Date:05/01/2026 ToTo Registration Number (GSTIN/UIN): 03CAEPG7493M1ZDRegistration Number (GSTIN/UIN): 03CAEPG7493M1ZDRegistration Number (GSTIN/UIN): 03CAEPG7493M1ZD GOLDYGOLDY GODOWNGODOWN NO NO-171,171, GROUND GROUND FLOOR, FLOOR, NORTH NORTH STEEL STEEL INDIA, NEAR CANAL, AMLOH ROAD, OPP DOABA MILL,INDIA, NEAR CANAL, AMLOH ROAD, OPP DOABA MILL,INDIA, NEAR CANAL, AMLOH ROAD, OPP DOABA MILL, DASHMESH COLONY, Mandi Govindgarh, Fatehgarh Sahib,DASHMESH COLONY, Mandi Govindgarh, Fatehgarh Sahib,DASHMESH COLONY, Mandi Govindgarh, Fatehgarh Sahib, Punjab, 147301Punjab, 147301 Show Cause Notice for CanShow Cause Notice for Cancellation of Registration 2026. 05.
06 09:36 Page 1 of 4 I attest to the accuracy and integrity of this document Whereas on the basis of information which has come to myWhereas on the basis of information which has come to myWhereas on the basis of information which has come to my notice,notice,notice, it it it appears appears appears that that that your your your registration registration registration is is is liable liable liable to to to be be be cancelled for the following reasons:cancelled for the following reasons:cancelled for the following reasons: 1. Section 29(2)(e)1. Section 29(2)(e)-registration obtained by means of fraud,registration obtained by means of fraud, wilful misstatemewilful misstatement or suppression of factsnt or suppression of facts 2. Rule 21 (a)2.
Rule 21 (a) - Person does not conduct any business fromPerson does not conduct any business from declared place of business/place of business not founddeclared place of business/place of business not founddeclared place of business/place of business not found 3. Rule 21(b)3. Rule 21(b)- person issues invoice or bill without supply ofperson issues invoice or bill without supply of goods or services or both in violation of the provisgoods or services or both in violation of the provisgoods or services or both in violation of the provisions of the Act, or the rules made thereunderAct, or the rules made thereunderAct, or the rules made thereunder 4. Rule 21(e)4. Rule 21(e)-person avails ITC in violation of the provisionsperson avails ITC in violation of the provisions of section 16 of the Act or the rules made thereunderof section 16 of the Act or the rules made thereunderof section 16 of the Act or the rules made thereunder 5. Rule 21(g)5.
Rule 21(g)-person violates the provision of rule 86Bperson violates the provision of rule 86B 6. Others6. Others Remarks:Remarks: The firm was foundThe firm was found non-existent during PV conducted by SGSTexistent during PV conducted by SGST authorities and they have requested to initiate cancellationauthorities and they have requested to initiate cancellationauthorities and they have requested to initiate cancellation proceedings of the GSTN. It appears that the registration wasproceedings of the GSTN. It appears that the registration wasproceedings of the GSTN. It appears that the registration was obtained by means of fraud, wilful misstatement or suppressionobtained by means of fraud, wilful misstatement or suppressionobtained by means of fraud, wilful misstatement or suppression of facts. Further, on scrutiof facts.
Further, on scrutiny of the records available on theny of the records available on the GST portal, it was found that the major suppliers of the firmGST portal, it was found that the major suppliers of the firmGST portal, it was found that the major suppliers of the firm has been cancelled suohas been cancelled suo-moto from date of registration formoto from date of registration for passing fake ITC. It appears that the your firm has beenpassing fake ITC. It appears that the your firm has beenpassing fake ITC.
It appears that the your firm has been operating on papers only and had alsooperating on papers only and had alsooperating on papers only and had also been e been e been engaged in availing & passing of fake ITC without actual movement ofavailing & passing of fake ITC without actual movement ofavailing & passing of fake ITC without actual movement of goods in contravention to the CGST Act, 2017, hence, yourgoods in contravention to the CGST Act, 2017, hence, yourgoods in contravention to the CGST Act, 2017, hence, your GST no. is liable for cancellation with retrospective effect i. e. GST no. is liable for cancellation with retrospective effect i. e. GST no. is liable for cancellation with retrospective effect i. e. from the date of registration. It is, therefore, requested tofrom the date of registration. It is, therefore, requested tofrom the date of registration.
It is, therefore, requested to susubmit your reply in r/o above charges within due date andbmit your reply in r/o above charges within due date and attend the personal hearing with relevant records, if any,attend the personal hearing with relevant records, if any,attend the personal hearing with relevant records, if any, which you want to produce in your defence. Otherwise, yourwhich you want to produce in your defence. Otherwise, yourwhich you want to produce in your defence. Otherwise, your GSTGSTGST No. No. No. will will will be be be cancelled cancelled cancelled retrospectively retrospectively retrospectively & & & further further further proceedings will be initiatedproceedings will be initiated against you under the CGST Act,against you under the CGST Act, 2017 to recover the government dues. 2017 to recover the government dues. 2017 to recover the government dues. 2026. 05.
06 09:36 Page 2 of 4 I attest to the accuracy and integrity of this document You are hereby directed to furnish a reply to the notice withinYou are hereby directed to furnish a reply to the notice withinYou are hereby directed to furnish a reply to the notice within seven working days from the date of service of this notice. seven working days from the date of service of this notice. seven working days from the date of service of this notice. You are hereby directed to appear before the undersignedYou are hereby directed to appear before the undersignedYou are hereby directed to appear before the undersigned authoauthority on 14/01/2026 at 10:30. rity on 14/01/2026 at 10:30.
If you fail to furnish a reply within the stipulated date or fail toIf you fail to furnish a reply within the stipulated date or fail toIf you fail to furnish a reply within the stipulated date or fail to appear for personal hearing on the appointed date and time,appear for personal hearing on the appointed date and time,appear for personal hearing on the appointed date and time, the case will be decided ex parte on the basis of availablethe case will be decided ex parte on the basis of availablethe case will be decided ex parte on the basis of available records and on merits. records and on merits. Please note thaPlease note that your registration stands suspended with effectt your registration stands suspended with effect from 23/08/2024. from 23/08/2024. Kindly refer the supportive document attached for case specificKindly refer the supportive document attached for case specificKindly refer the supportive document attached for case specific details. details.
Place: CBICPlace: CBIC Date: 05. 01. 2026Date: 05. 01. 2026 Ashish Kumar Singh Superintendent Range-IV” 3. A perusal of the afore quoted show cause notice reveals thatA perusal of the afore quoted show cause notice reveals thatA perusal of the afore quoted show cause notice reveals that the same is based on physical verification conducted by the State authoritiesthe same is based on physical verification conducted by the State authoritiesthe same is based on physical verification conducted by the State authorities as per which the petitioneras per which the petitioner-firm was not found to exist. firm was not found to exist.
Further, on scrutiny of the records available on the GST porrecords available on the GST portal it had been found that GST registration ofregistration of the petitioner’s major suppliers having been cancelledthe petitioner’s major suppliers having been cancelled with retrospective effectretrospective effect and that the petitioner had been operating on paper onlyhe petitioner had been operating on paper only as also that it has also that it had been availing/passing on fake Ising on fake Input Tax Credit without actual movement of goods. actual movement of goods. 4. In support of the afore basis,In support of the afore basis, no physical verification reportphysical verification report has been supplied to the petitioner. been supplied to the petitioner. No details with regard to cancellation ofo details with regard to cancellation of GST registrationGST registration of any of its major suppliersmajor suppliers has also been furnished.
Details as to how the petitioner is availing/passing on fake Ias to how the petitioner is availing/passing on fake Ias to how the petitioner is availing/passing on fake Input Tax Credit without actual movement of goodwithout actual movement of goods are also missing. missing. Though it is mentioned in the impugnedimpugned show cause notice that for specific detailsfor specific details supportive 2026. 05. 06 09:36 Page 3 of 4 I attest to the accuracy and integrity of this document documents areare attached but admittedly, no such supportivesuch supportive documents were appended along with the impugned show cause notice served upon thealong with the impugned show cause notice served upon thealong with the impugned show cause notice served upon the petitioner. 5. In the light of the above, the impugned show cause noticeIn the light of the above, the impugned show cause noticeIn the light of the above, the impugned show cause notice dated 05. 01. 2026dated 05. 01.
2026 is violative of the principles of natural justice andis violative of the principles of natural justice and does not serve the purpose behind itserve the purpose behind its issuance. It is also against the spirit of Rule. It is also against the spirit of Rule 22 of the Centralentral Goods and Services Tax Rules 2017Rules 2017. Therefore, we set aside the show cause notice dated 05. 01. 2026 (Annexure Pshow cause notice dated 05. 01. 2026 (Annexure Pshow cause notice dated 05. 01. 2026 (Annexure P-2) with liberty to the respondents to proceedto the respondents to proceed afresh against the petitioner in accordanceagainst the petitioner in accordance with law. 6. The petition is allowed in the above terms. The petition is allowed in the above terms. The petition is allowed in the above terms.
(DEEPAK SIBALDEEPAK SIBAL) JUDGEJUDGE (LAPITA BANERJI)(LAPITA BANERJI) JUDGEJUDGE April 30, 2026, 2026 vandana Whether speaking/reasoned :ther speaking/reasoned : Yes/No Whether reportableWhether reportable : Yes/No 2026. 05. 06 09:36 Page 4 of 4 I attest to the accuracy and integrity of this document
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