M/S Sri Sai Motors, Vs State of Karnataka

M/S SRI SAI MOTORS, (A PROPRIETORSHIP CONCERN REGISTERED UNDER THE GOODS AND SERVICE TAX ACT 2017) REP BY ITS PROPREITOR SRI.G.VIJAYA KRISHNA AGE ABOUT 53 YEARS NO.132, GANTAMAVARAPALLI PANCHYAT YETIGADDAPALLI VILLAGE BAGPALLI TALUK CHIKKABALLAPUR DISTRICT 561 207.

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…PETITIONER

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(BY SRI. RAGHAVENDRA.B. HANJER, ADVOCATE)

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Digitally signed by CHANDANA B M Location: High Court of Karnataka

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AND:

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STATE OF KARNATAKA REP BY ITS SECRETARY DEPARTMENT OF REVENUE VIDHANA SOUDHA AMBEDKAR VEEDHI BANGALORE 560 001.

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THE ASSISTANT COMMISSIONER OF COMMERCIAL TAXES OLD RTO BUILDING KIADB INDUSTRIAL AREA LGSTO 183 CHIKKABALLAPUR – 562 101.

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…RESPONDENTS

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(BY SRI. K. HEMAKUMAR, AGA)

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NC: 2025:KHC:45469 WP No. 30487 of 2025

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HC-KAR

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THIS W.P IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUITON OF INDIA PRAYING TO ISSUE A WRIT, ORDER OR DIRECTION IN THE NATURE OF CERTIORARI BY QUASHING THE IMPUGNED EX PARTE SUMMARY OF THE ORDER BEARING NO. CTO/LGSTO-183/CB.PUR/DRC-07/3B 2A/T.22265/2023-24 DATED 28.03.2024 (ANNEXURE- A1) ALONG WITH SUMMARY OF THE ORDER BEARING REFERENCE NO. ZD2904240651949 ISSUED IN FORM GST DRC-07 DATED 25.04.2024 PASSED BY THE 2ND RESPONDENT (ANNEXURE- A2) AND THE ACKNOWLEDGMENT FOR SUBMISSION OF APPEAL BEARING REFERENCE NO. ZD290225112265M DATED 27.02.2025 ISSUED IN FORM GST APL-02 BY THE JOINT COMMISSIONER OF COMMERCIAL TAXES (APPEALS)-5, BANGALORE (ANNEXURE- B) AND ETC.

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

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CORAM: HON'BLE MR. JUSTICE S.R.KRISHNA KUMAR

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ORAL ORDER

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In this petition, petitioner seeks the following reliefs:-

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“ a) Issue a writ, order or direction in the nature of Certiorari by quashing the impugned ex parte Summary of the Order bearing No. CTO/LGSTO-183/CB.Pur/DRC-07/38 v/s 2A/T.22265/2023-24 dated: 28.03.2024 (Annexure- "A1") along with Summary of the Order bearing Reference No. ZD2904240651949 issued in FORM GST DRC-07 dated 25.04.2024 passed by the 2^nd Respondent (Annexure- 'A2') and the Acknowledgment for submission of appeal bearing Reference No. ZD290225112265M dated 27.02.2025 issued in FORM GST APL-02 by the Joint Commissioner of Commercial Taxes (Appeals)-5, Bangalore (Annexure- 'B');

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NC: 2025:KHC:45469 WP No. 30487 of 2025

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HC-KAR

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b) Consequently, issue a writ, order or direction in the nature of any writ declaring that the input tax credit of IGST claimed by the Petitioner but not reflected in the GSTIN Portal for the tax period April 2018 to March 2019 is in accordance with the provisions of Section 16(1) of the CGST KGST Acts, 2017;

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c) Alternatively, issue a writ, order or direction in the nature of Certiorari by quashing the impugned ex parte Summary of the Order No. CTO/LGSTO-183/CB.Pur/DRC07/38 v/s 2A/T-22265/2023-24 dated 28.03.2024 along with Summary of the Order Reference No. ZD2904240651949 Issued in FORM GST DRC-07 dated 25.04.2024 passed by the 2 A2 Respondent (Annexures 'A1’ and ‘A2’ the Acknowledgment for submission of appeal Reference No. ZD290225112265M dated 27.02.2025 issued in FORM GST APL-02 by the Joint Commissioner of Commercial Taxes (Appeals)-5, Bangalore (Annexure-'B') and thereby, remand the matter back to the 20d Respondent to consider the issue afresh after granting an opportunity to file reply to the show cause notice and also an opportunity of personal hearing to the Petitioner;

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d) Pass such other orders or directions as deemed fit and proper in the facts and circumstances of the case in the interest of Justice.”

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2. Heard learned counsel for the petitioner and learned

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counsel for the respondents and perused the material on record.

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NC: 2025:KHC:45469 WP No. 30487 of 2025

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HC-KAR

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Though several contentions have been urged by both

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sides in support of their respective claims, the issue in controversy between the parties is directly and squarely covered by the judgment of the Co-ordinate Bench of this Court in the case of

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M/s.Happymongo Online Solution Private Limited Vs. State of Karnataka and Anr., - W.P.No.26204/2025 dated 10.10.2025 wherein it was held as under:

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“In this petition, petitioner seeks for the following reliefs:-

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"a) Issue a writ or order or direction in the nature of Certiorari quashing the impugned Show Cause Notice bearing File No. DCCT(A)4.5/DGSTO-4 /Adjudication/No.22/SCN/2023-24 dated 05.06.2023 along with Summary of the Show Cause Notice bearing Reference No. 202912230498643 dated 18.12.2023 issued in FORM GST DRC-01 by the 2 Respondent (Annexures- 'A'1 & 'A'2), the impugned ex parte Order of Adjudication bearing File No. DCCT(A)dated 4.5/DGSTO4/Adjudication/ No.22/SCN/2024-25 17.04.2024 along with Summary of the Order bearing Reference No: ZD290424042158C dated 18.04.2024 Issued / passed in FORM GST DRC-07 by the 2nd Respondent (Annexures- 'B'1 & 'B'2) and the Notice issued by the Court of Special JMFC (Sales Tax), Bangalore pending on the file of Cr.Misc. 106/2025 (Annexure- 'C');

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b) Issue a writ or order or direction in the nature of any w by aside the input tax credit of Rs.22,26,61 along with interest of Rs.22,04,346/and penalty of Rs.2,33,863/-confirmed in the impugned ex parte Order of Adjudication bearing File No. DCCT(A)-4.5/DGSTO 4/Adjudication

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5 - NC: 2025:KHC:45469 WP No. 30487 of 2025

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HC-KAR

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/No.22/SCN/2024-25 dated 17.04.202 along with of the Order bearing Reference N-ZD290424042158C dated 18.04.2024 issued / passed FORM GST DRC-07 by the 2nd Respondent (Annexure 'B'1 & 'B'2);

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c) Pass such other order(s) or direction(s) as deemed fit proper in the facts and circumstances of the case in interest of justice."

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2. Heard learned counsel for the petitioner and learned HCGP for the respondents and perused the material on record.

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3. A perusal of material on record will indicate that pursuant to an Intimation at Annexure-H in Form DRC01A dated 18.04.2023, the 2^nd respondent issued a showcause notice dated 05.06.2023 under Section 73(1) of the CGST/KGST Act, 2017 alleging that there was shortdeclaration of output tax liability. The petitioner filed its reply to the aforesaid Show-cause notice on 23.12.2023 and also filed additional reply along with supporting documents on 04.04.2024 and sought for personal hearing. Subsequently, the 2^nd respondent passed an adjudication order dated 17.04.2024 under Section 73(9) of the CGST / KGST Act confirming a total demand of Rs.22,26,612/along with interest of Rs.22,04,346/- and a penalty of Rs.2,33,863/-, without granting an opportunity of personal hearing to the petitioner. Thereafter, the 2^nd respondent initiated recovery proceedings against the petitioner in Crl.Misc.106/2025 before the Court of Special Judge, JMFC (Sales Tax), which issued a Notice dated 04.07.2025 calling upon the petitioner to appear before the aforesaid court and to pay the arrears of tax. The petitioner only on

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NC: 2025:KHC:45469 WP No. 30487 of 2025

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HC-KAR

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receiving the aforesaid Notice on 12.08.2025, realized regarding the said ex-parte impugned adjudication order. Aggrieved by which, the petitioner is before this Court by way of the present petition.

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4. In addition to reiterating the various contentions urged in the petition and referring to the material on record, learned counsel for the petitioner submits that though the petitioner had sought for personal hearing in order to put forth his contentions and submit necessary documents, the 2^nd respondent without considering the same, has proceeded to pass the impugned ex-parte order which is violative of the principles of natural justice and the same deserves to be set aside and the 2^nd respondent may be directed to pass fresh order after granting an opportunity of personal hearing to the petitioner. It is further submitted that the impugned proceedings initiated pursuant to the impugned show cause notice dated 18.12.2023 is barred by limitation under Section 73(10) of the KGST Act and as such, the availability of equivalent, efficacious and alternative remedy by way of filing of an appeal under Section 107 of the CGST / KGST Act would not come in the way of the petitioner prosecuting the present petition.

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5. Per contra, learned HCGP for the respondents – revenue submits that the period of limitation has been extended by the respondents vide Notification No. 13/2022 dated 05.07.2022, Notification Nos. 9 and 56 of 2023 dated 31.03.2023 and 08.12.2023 respectively and as such, it cannot be said that the proceedings are barred by limitation.

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NC: 2025:KHC:45469 WP No. 30487 of 2025

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HC-KAR

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6. Learned counsel for the petitioner would invite my attention to the Petition in Special Leave Appeal (C) No. 4240/2025 pending before the Apex Court in order to contend that the validity of such Notifications are seized by the Apex Court and pending adjudication.

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7. In view of the aforesaid facts and circumstances and the submissions made by both sides will indicate that the validity of the aforesaid Notifications are seized by the Apex Court which will have an impact / bearing on the impugned proceedings, I am of the view that one more opportunity is required to be granted in favour of the petitioner by setting aside the impugned adjudication order and remitting the matter back to the respondents for reconsideration afresh in accordance with law.

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8. Under these circumstances, in order to avoid multiplicity of proceedings and to ensure that there are no conflicting orders, I deem it just and appropriate to direct the 2^nd respondent to reconsider the matter afresh and pass a fresh adjudication order in accordance with law after disposal of Special Leave to Appeal (C) No.4240/2025 by the Apex Court.

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9. In the result, I pass the following:-

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ORDER

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(i) Petition is hereby allowed, subject to payment of cost of Rs.10,000/- to the Karnataka High Court Legal Services Authority, Bengaluru, within a period of six weeks from today.

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NC: 2025:KHC:45469 WP No. 30487 of 2025

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HC-KAR

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(ii) The impugned orders at Annexure B1 and B2 both dated 17.04.2024 passed by the 2^nd respondent are hereby set aside.

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(iii) The matter is remitted back to the 2^nd respondent for reconsideration afresh and pass a fresh adjudication order in accordance with law after disposal of SLP No.4240/2025.

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(iv) The period between the date of the impugned order i.e., 17.04.2024 and the date on which the Apex Court passes orders would be excluded for the purpose of limitation.”

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4. Under these identical circumstances, I deem it just and

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appropriate to allow the present petition also in terms of the aforesaid judgment of this Court.

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Accordingly, I pass the following:-

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ORDER

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(i) Petition is hereby allowed, subject to payment of cost of Rs.10,000/- to the Karnataka High Court Legal Services Authority, Bengaluru, within a period of six weeks from today.

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(ii) The impugned orders at Annexure - A1 dated 28.03.2024, Annexure - A2 dated 25.04.2024 passed by the 2^nd respondent and Annexure – B dated 27.02.2025 are hereby set aside.

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NC: 2025:KHC:45469 WP No. 30487 of 2025

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HC-KAR

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(iii) The matter is remitted back to the 2^nd respondent for reconsideration afresh and pass a fresh adjudication order in accordance with law after disposal of SLP No.4240/2025.

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(iv) The period between the date of the impugned order

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i.e., 28.03.2024 and the date on which the Apex Court passes orders would be excluded for the purpose of limitation.

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Sd/(S.R.KRISHNA KUMAR) JUDGE

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SV

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List No.: 2 Sl No.: 40

M/S Sri Sai Motors, v. State of Karnataka

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M/S Sri Sai Motors, v. State of Karnataka

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