This petition is directed against the two orders both dated February 26, 1996, contained in annexures 7 and 8 to the writ petition by which the Trade Tax Officer, Sector-14, Agra, the sole respondent has cancelled the registration of the petitioner both under the U. P. Trade Tax Act, 1948, and the Central Sales Tax Act, 1956, respectively. 2. We have heard the learned counsel for the parties. 3. The impugned orders proceed on the allegation that since the petitioner had failed to furnish the additional security of Rs. 2,00,000 demanded from the petitioner, therefore, the registrations were being cancelled. 4. The petitioner is a firm which carries on business, inter alia, in iron and steel building materials and stone grits, etc. At the time when registration was obtained both under the U. P. Trade Tax Act and the Central Sales Tax Act the petitioner was required to give a bank guarantee of Rs. 15,000 which was admittedly furnished. A notice purporting to be under section 8-C of the U. P. Trade Tax Act was served upon the petitioner demanding additional security of Rs. 2,00,000 by January 30, 1996, failing which the notice stated that proceedings for the cancellation of the registration will be taken. It may be observed that no reasons have been indicated in the said notice for which it became necessary to require the petitioner to furnish an additional security of rupees two lacs. However, some grounds have been set out in the counter-affidavit, but it is not necessary to refer them. It is not disputed that the petitioner objected to the notice under section 8-C and stated that it was not liable to furnish any additional security. Thereafter, the petitioner was issued a notice dated January 3, 1996 for cancellation of its registration under the aforesaid two Acts with the allegation that the reply filed by the petitioner was not found satisfactory, therefore, it should show cause by September 8, 1996 as to why its registration should not be cancelled. At this stage the petitioner approached this Court under article 226 of the Constitution of India by Writ Petition No. 166 of 1996. At this stage the petitioner approached this Court under article 226 of the Constitution of India by Writ Petition No. 166 of 1996. While inviting counter-affidavit on February 26, 1996 and a Division Bench of this Court passed an interim order to the effect that " In the meantime no steps will be taken to cancel the registration of the petitioner pursuant to the impugned notices dated February 15, 1996 (annexure 9 to the writ petition) both under the U. P. and Central Sales Tax Acts and forms XXXI will be issued to the petitioner on the previous terms and conditions in accordance with law". 5. Despite the interim order passed by this Court the registration of the petitioner was cancelled under the U. P. Trade Tax Act and the Central Sales Tax Act on the allegation that the petitioner did not appear on the date fixed in the show cause notice and the additional security of rupees two lacs was not furnished. It is averred in the counter-affidavit that the interim order passed by this Court was not placed before the respondent although the case of the petitioner is that the said order was duly brought to the notice of the respondent and he proceeded to pass the impugned order in violation of the interim order. 6. It is averred in the counter-affidavit that the interim order passed by this Court was not placed before the respondent although the case of the petitioner is that the said order was duly brought to the notice of the respondent and he proceeded to pass the impugned order in violation of the interim order. 6. Sub-section (2) of section 8-C contemplates as under " (2) Where it appears necessary to the assessing authority so to do - (a) for the proper realisation of any tax, penalty or other sums due or payable under this Act; or (b) for the proper custody or use of forms prescribed under this Act or the Rules framed thereunder; or (c) as a condition for the grant or, as the case may be, renewal or the continuance in effect of a recognition certificate or a certificate of registration or provisional registration, it may, by an order in writing and for reasons to be recorded therein, direct, before the grant or, as the case may be, renewal of such certificate or at any time while such certificate is in force, that the dealer or the person concerned shall furnish, in the prescribed manner and within such time as may be specified in the order, such security or, if the dealer or the person concerned has already furnished security, such additional security, of any nature other than those specified in sub-section (1), as may be specified, for all or any of the aforesaid purposes : Provided that the dealer or the person concerned may, if he so likes, instead of furnishing security of the nature asked for, furnish security of the nature specified in sub-section (1 ). " 7. Sub-section (3) of section 8-C states that no dealer or the person concerned shall be required to furnish security or additional security under sub-section (2) by the assessing authority unless he has been given an opportunity of being heard, and the amount of such security or additional security that may be required to be furnished by any dealer shall in no case exceed the tax payable, in accordance with the estimate of the assessing authority, on the turnover of the dealer for the assessment year in which such security is required to be furnished. 8. 8. It is pertinent to observe that notice issued under sub-section (2) of section 8-C dated January 19, 1996, straightaway required the petitioner to give additional security of Rs. 2,00,000 without requiring the petitioner to show cause as contemplated in sub-section (3) of section 8-C. The notice also as observed earlier does not disclose any reason on account of which the petitioner was called upon to furnish the additional security. However, as stated earlier, the petitioner had objected to the demand of additional security and thus it was incumbent on the part of the respondent to pass appropriate orders dealing with the objections of the petitioner. However, it appears no such order was passed. At least none was communicated to the petitioner. By an order dated September 2, 1997, this Court directed the Standing Counsel to file a supplementary counter-affidavit annexing thereto a copy of the order that may have been passed by the Trade Tax Officer under section 8-C demanding additional security. Supplementary counter-affidavit was filed in pursuance of the aforesaid order but no copy of the order has been brought on record by which the objections of the petitioner may have been dealt with and a decision was taken requiring the petitioner to furnish additional amount of security in accordance with the provisions of sub-section (3) of section 8-C referred earlier. 9. Now if the objections of the petitioner were not dealt with and no such order was communicated to the petitioner, it is difficult to appreciate how the petitioner could be treated as a defaulter in furnishing the additional security and to penalise it by cancellation of its registration. As already stated this Court vide order dated February 26, 1996, has stayed further proceedings in pursuance to the notice issued for cancellation of the registration although there is a dispute as to whether that order was brought to the notice of the assessing authority. However when the case is considered in its entirety and in the light of facts stated hereinabove, we have no hesitation in saying that the respondent/assessing authority has proceeded with unnecessary haste in passing the impugned orders and that too without complying with the mandatory requirement of the provisions of the Act to which reference has already been made. However when the case is considered in its entirety and in the light of facts stated hereinabove, we have no hesitation in saying that the respondent/assessing authority has proceeded with unnecessary haste in passing the impugned orders and that too without complying with the mandatory requirement of the provisions of the Act to which reference has already been made. The cancellation of the registration has a serious consequence in continuing the business of a dealer and such an order cannot be permitted to be passed unless the due procedure provided under the Act is adopted by the assessing authority. 10. For the reasons stated above, the impugned orders cancelling the registration of the petitioner are quashed. However, it will be open to the assessing authority to proceed afresh, if considered necessary and to pass appropriate orders in accordance with law. In the result, the writ petition succeeds and is allowed. Writ petition allowed. .