M/S Hukkeri Taluka Samagra Grameen Vs the State of Karnataka

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1 - NC: 2025:KHC-D:8327 WP No. 103029 of 2025

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HC-KAR

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IN THE HIGH COURT OF KARNATAKA, DHARWAD BENCH DATED THIS THE 3^RD DAY OF JULY 2025

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BEFORE

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THE HON'BLE MR. JUSTICE PRADEEP SINGH YERUR WRIT PETITION NO. 103029 OF 2025 (T-RES)

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BETWEEN:

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M/S. HUKKERI TALUKA SAMAGRA GRAMEEN ABHIVRADDI SANGH, CTS 2360, GURUKRIPA BUILDING, NEAR BDCC BANK, HUKKERI, BELAGAVI, KARNATAKA-591309 GSTIN - 29AAAAH1667D1ZU

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VIJAYALAKSHMI M KANKUPPI

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Location: HIGH COURT OF KARNATAKA DHARWAD BENCH

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REPRESENTED HEREIN BY IT’S PRESIDENT, MR. VIJAYAKUMAR RAVADI, S/O. BALAPPA RAVADI, AGED ABOUT 66 YEARS, ADDRESS - HOUSE NO.2360/1, NEAR BUS STAND, HUKKERI BELAGAVI, KARNATAKA-591309 AADHAR NO.324976146396 EMAIL: rjdjuly2017@gamil. com MOB: 9739595311 …PETITIONER

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(BY SRI. GANESH VISHWNATH SHANDAGE, ADVOCATE)

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AND:

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THE STATE OF KARNATAKA, REPRESENTED BY CHIEF SECRETARY TO GOVT., VIDHANA SOUDHA, BENGALURU-560009.

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THE UNION OF INDIA, REPRESENTED BY HEREIN BY THE SECRETARY, DEPARTMENT OF REVENUE, MINISTRY OF FINANCE, GOVERNMENT OF INDIA, NORTH BLOCK, NEW DELHI-110001.

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THE CHAIRMAN, CENTRAL BOARD OF INDIRECT

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2 - NC: 2025:KHC-D:8327 WP No. 103029 of 2025

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HC-KAR

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TAXES AND CUSTOMS DEPARTMENT OF REVENUE, MINISTRY OF FINANCE, GOVERNMENT OF INDIA, NEW DELHI-110001.

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THE COMMISSIONER OF COMMERCIAL TAXES, COMMERCIAL TAX DEPARTMENT, GOVERNMENT OF KARNATAKA, COMMERCIAL TAX OFFICE-1, FIRST MAIN ROAD, GANDHINAGAR, BENGALURU-560009.

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THE JOINT COMMISSIONER OF COMMERCIAL TAXES (APPEALS), COMMERCIAL TAX DEPARTMENT, GOVERNMENT OF KARNATAKA, SUMOULYA SOUDHA, 5^TH FLOOR, CLUB ROAD, BELAGAVI-590001.

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THE JOINT COMMISSIONER OF COMMERCIAL TAXES (ENFORCEMENT), COMMERCIAL TAX DEPARTMENT GOVERNMENT OF KARNATAKA, SUMOULYA SOUDHA, 4^TH FLOOR, CLUB ROAD, BELAGAVI-590001.

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THE JOINT COMMISSIONER OF COMMERCIAL TAXES (ADMINISTRATION), COMMERCIAL TAX DEPARTMENT, GOVERNMENT OF KARNATAKA, SUMOULYA SOUDHA, 4^TH FLOOR, CLUB ROAD, BELAGAVI-590001

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THE COMMERCIAL TAX OFFICER, SGSTO-381, SANSUDDI BUILDING, POST OFFICE ROAD, SANKESHWAR-591313.

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THE COMMERCIAL TAX OFFICER, (ENFORCEMENT), GOKAK, NORTH ZONE, BELAGAVI, SUMOULYA SOUDHA, CLUB ROAD, BELAGAVI-590001.

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THE COMMERCIAL TAX OFFICER, (ENFORCEMENT)-3, BELAGAVI, SUMOULYA SOUDHA, CLUB ROAD, BELAGAVI-590001.

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…RESPONDENTS

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(BY SRI. SHARAD V. MAGADUM, AGA FOR R1, R3-R10; SRI. VENKATESH M. KHARVI, ADVOCATE FOR R2)

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3 -

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NC: 2025:KHC-D:8327 WP No. 103029 of 2025

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HC-KAR

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THIS WRIT PETITION IS FILED UNDER ARTICLE 226 OF THE CONSTITUTION OF INDIA, 1950 PRAYING TO

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A. ISSUE A WRIT OF MANDAMUS, OR SUCH OTHER WRIT, ORDER OR DIRECTION, AS THIS HONORABLE COURT MAY DEEM FIT TO RESPONDENT NO.05 (THE LD. JOINT COMMISSIONER OF COMMERCIAL TAXES (APPEALS), BELAGAVI) TO CONSIDER RESPONDENT NO.03’S (CBIC) INSTRUCTION 1/2022-23 (GSTINVESTIGATION), DATED 25-5-2022 AND SETTLED PROPOSITION OF LAW AS LAID DOWN IN PETITIONER’S RELIED UPON JUDGEMENTS OF HON’BLE SUPREME COURT AND HON’BLE HIGH COURTS INCLUDING JURISDICTIONAL HON’BLE HIGH COURT OF KARNATAKA AS CITED IN THE GROUNDS HEREINABOVE (SUPRA), AND ON MERITS TO EXPEDITIOUSLY WITHOUT ANY DELAY ADJUDICATE AND DECIDE TWO APPEALS BEARING ONLINE ACKNOWLEDGEMENT NO.AD2902250288123 DATED 13.02.2025 FOR FY 2017-18 AND AD290225028856R DATED 13.02.2025 FOR FY 2018-19, (ANNEXURE-J1 AND ANNEXURE-J2 RESPECTIVELY).

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B. ISSUE AN APPROPRIATE WRIT, ORDER OR DIRECTION, HOLDING AND DECLARING THAT THE PETITIONER IS LEGALLY ENTITLED TO RECEIVE A REFUND AMOUNT OF RS.53,97,352 ALONG WITH APPLICABLE INTEREST, WHICH THE RESPONDENT NO.09 HAS RECOVERED FROM THE PETITIONER DURING THE COURSE OF INVESTIGATION UNDER DURESS BY ADOPTING COERCIVE AND FORCEFUL MEANS, WITHOUT PREDATED SHOW CAUSE NOTICE OR PRE-SHOW CAUSE NOTICE INTIMATION HAVING ISSUED UNDER GST ACT, AND ETC.

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THIS PETITION COMING ON FOR PRELIMINARY HEARING THIS DAY, ORDER WAS MADE THEREIN AS UNDER:

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ORAL ORDER

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(PER: THE HON'BLE MR. JUSTICE PRADEEP SINGH YERUR)

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Petitioner Sangha is a registered taxpayer providing manpower supply services to various Government Departments and Authorities. It is registered under the Central Goods and

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4 - NC: 2025:KHC-D:8327 WP No. 103029 of 2025

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HC-KAR

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Services Tax Act, 2017 (for short, ‘CGST Act’) and Karnataka Goods and Services Tax Act, 2017 (for short, ‘the KGST Act’) with G.S.T. I.N. No.29AAAAH1667D1ZU.

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Petitioner claims to be an honest, diligent and prompt tax payer under the GST Act and has been timely paying the returns as per law without any liabilities. This being the state of affairs, respondent No.9 on 20.01.2024 prepared manual intelligence Report/Note alleging a discrepancy of Rs.36,00,000/- between petitioner’s GSTR-3B and GSTR-7 returns, accordingly sought for an authorization to inspect the business premises of the petitioner. On the same day, invoking powers under Section 67(1) of the Central GST Act, respondent no.6 issued an authorization in Form GST INS-01 dated 20.01.2024 to conduct inspection of the petitioner’s business premises, but failed to mention the complete address of the property in the relevant column. It is the case of petitioner that respondent no.9 visited and entered the premises and not only conducted inspection, but performed unauthorized search using threat of arrest legal consequences and intimidated the petitioner and its staff. It is further contended that a series of endorsements were issued demanding payment of penalty and

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5 - NC: 2025:KHC-D:8327 WP No. 103029 of 2025

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HC-KAR

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interest amounting to Rs.2,33,91,504/-. It is the contention of learned counsel that coercively payments were recovered without issuing any statutory notice or order and respondent no.9 belatedly initiated statutory procedure under the GST Act by issuing pre-SCN intimation under Section 74(5) for 2017-18.

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It is the contention of learned counsel for the petitioner that by making several allegations against the respondent statutory authorities that they have conducted unlawful search and has recovered money forcefully by threat of arrest and therefore the entire process initiated by them is illegal as coercive methods were used forcing the petitioner to pay the amount, which is recovered by the respondent authorities. It is the contention of petitioner that he has preferred an appeal under Section 107(1) of the GST Act before the appellate authority, which is pending adjudication and the same is not being conducted in an expeditious manner. Therefore, the petitioner is before this Court seeking a writ of mandamus directing the appellate authority to dispose of the matter expeditiously as the petitioner is dependant on the said income which is forceful recovery and he does not have to pay any amount. It is further contended that the petitioner has very

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6 - NC: 2025:KHC-D:8327 WP No. 103029 of 2025

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HC-KAR

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good case on merits, the amount i.e., recovered is without appropriate procedure and it by undue influence and force and coercion. Therefore, the present petitioner is filed seeking a writ of mandamus.

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Learned counsel for the petitioner has relied upon the

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following decision in support of his case :

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(i) Dabur India Ltd. vs. State of Uttar Pradesh, [1990] 1990 taxmann.com 101 (SC).

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(ii) Radhika Agarwal vs. Union of India, [2025] taxman.com 832 (SC).

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(iii) Intelligence Officer, Directorate General of GST Intelligence, Bengaluru vs. Kesar Color Chem Industries, [2025] 171 taxmann.com 739 (Karnataka).

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(iv) Union of India vs. Bundi Technologies (P.) Ltd., [2022] 136 taxmann.com 112 (Karnataka).

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These Judgments may be helpful to the petitioner in

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the appeal proceedings as the present petition is for a writ of mandamus for consideration as it is for the appellate authorities to decide whether the amount i.e., collected is voluntarily or involventary or by way of force, coercion or undue influence.

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7 - NC: 2025:KHC-D:8327 WP No. 103029 of 2025

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HC-KAR

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Per Contra, the learned AGA representing the respondent/State denies the averments and contents stated with regard to any force, coercion or undue influence or threat being used to collect the statutory dues in the GST Act. There is an order passed by the authorities which is now questioned by the petitioner before the appellate authority. The appellate authority would decide on merits in accordance with law and respondent would co-operate in disposal of the said appeal. The said appeal is preferred on 13.02.2025, now we are in the month of July, 2025. The appellate authority is yet to issue notice to the petitioner. Under the circumstances, this Court is of the opinion that when the petitioner has failed to challenge the orders of authority for imposition of tax and recovery of the amount, same would have to be decided in the time bound manner. Accordingly, I pass the following :

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ORDER

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(i) Petition is allowed.

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(ii) Writ of mandamus is issued directing respondent No.5 to consider the appeal preferred by the petitioner in accordance with law expeditiously

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8 - NC: 2025:KHC-D:8327 WP No. 103029 of 2025

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HC-KAR

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taking into consideration decisions relied upon by learned counsel for the petitioner in the cases mentioned hereinabove, the appeal shall be disposed of.

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(iii) The 5^th respondent shall issue notice within two weeks from the date of receipt of copy of this order and decide the appeal within six weeks thereafter.

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(iv) This Court has not expressed any opinion on the merits of the matter.

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(v) All contentions of the petitioner and respondents are kept open.

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Sd/(PRADEEP SINGH YERUR) JUDGE

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CKK CT-MCK

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List No.: 1 Sl No.: 2

M/S Hukkeri Taluka Samagra Grameen v. the State of Karnataka

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M/S Hukkeri Taluka Samagra Grameen v. the State of Karnataka

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