The Jammu & Kashmir and Ladakh High Court ruled that disagreements over Undivided Property Cannot be the reason for cancellation of GST Registration.
By the Letters Patent Appeal, the appellant questions the judgment/ final order passed by the Writ Court in writ petition, whereby the writ petition filed by the appellant, assailing the License issued by the Designated Officer/ State Licensing Authority under the Food Safety and Standard Act, 2006, in respect of Samci Restaurant, Residency Road, Srinagar; communication, issued by respondent intimating the appellant that the license, is issued to the premises Samci Restaurant and not to respondent no. 5 and that it would be appropriate and in the interest of both the parties that the name of the appellant is also inserted in the application form as incharge operation and person responsible for complying the conditions of the license; and order, issued by respondent no. 2, whereby GST registration in favour of the petitioner has been cancelled and a fresh registration has been issued in favour of respondent no. 5, on the grounds taken in the memo of appeal.
Advocate General submitted that the appellant had himself filed an application seeking cancellation of registration of his business unit which was allowed and the registration came to be cancelled accordingly.
He further submitted that since the cancellation of registration was based on the request of appellant himself, therefore, there was no question of revoking the same again on his request.
The division bench of The Chief Justice of India Ali Mohammad Magrey and Justice Moksha Khajuria Kazmi observed that neither the appellant nor the respondent no. 5 was having a license, during the pendency of the writ petition, to run the business in question. The issue, as such, was yet again open to be considered afresh by the competent authority. As regards the registration of the business unit, the same stands cancelled insofar as the appellant is concerned, however, the same, as of now, is registered in the name of respondent no. 5.
It further observed that the proper course was to leave the concerned authority free to take a decision as to who, out of the two, fulfils the criteria for holding a license without placing any embargo on its powers in contravention of the relevant provisions of the Act.
The bench held that the Writ Court, therefore, has erred in placing a restraint on the powers of the competent authority to grant a license in favour of the party fulfilling the criteria laid down under the relevant provisions of the law.
The court, while setting aside the paragraph nos. 27 and 28 of the judgment, disposed of the appeal by providing that the appellant as also the respondent no. 5 shall be at liberty to approach the concerned authority for issuance/renewal of license.
The court further ordered that till the time the license is granted in favour of the rightful party by the competent authority, the Samci Restaurant shall not be operated/ run by any of the party.
Case title: Parveez Ahmad Baba v/s Union Territory of JK and others
Citation: LPA no. 197/2022