M/S First Cars Private Limited Vs Joint Commissioner of Central Tax

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NC: 2025:KHC:11397 WP No. 4419 of 2025

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 19^TH DAY OF MARCH, 2025 BEFORE

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THE HON'BLE MR JUSTICE S.R.KRISHNA KUMAR WRIT PETITION NO. 4419 OF 2025 (T-RES)

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BETWEEN:

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M/S FIRST CARS PRIVATE LIMITED FLAT NO.44, SRI ATTIMARAMMADEVI DEVASTANA ABHIVRUDHI SAMITHII , SRI RAMA TEMPLE ROAD, DOMLUR BENGALURU URBAN – 560 071.

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A COMPANY REGISTERED UNDER COMPANIES ACT 1956 REPRESENTED BY ITS AUTHORIZED SIGNATORY MR. AKSHAYA PUTHRAN (LEGAL COUNSEL) AGED 41 YEARS, RESIDING AT 7, 20^TH H CROSS EJIPURA RAMA TEMPLE, BENGALURU, KARNATAKA – 560 047.

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…PETITIONER

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(BY SRI. G SHIVADASS, SR. ADVOCATE FOR SRI. PRASHANTH SABARISH SHIVADASS, ADVOCATE)

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AND:

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Digitally signed by LEELAVATHI S R Location: High Court of Karnataka

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JOINT COMMISSIONER OF CENTRAL TAX, BENGALURU EAST COMMISSIONERATE OFFICE OF THE PRINCIPAL COMMISSIONER OF CENTRAL TAX GST COMMISSIONERATE, BENGALURU EAST 4^TH FLOOR, TTMC/BMTC BUILDING OLD AIRPORT ROAD, DOMLUR BENGALURU – 560 071.

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…RESPONDENT

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(BY SRI. ARAVIND V CHAVAN, ADVOCATE)

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THIS W.P. IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE IMPUGNED ORDER-IN-ORIGINAL NO. 118/2024/JC-1 DATED 10.12.2024 ISSUED

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2 - NC: 2025:KHC:11397 WP No. 4419 of 2025

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IN FORM GST DRC-07 AT ANNEXURE-A FILE NO. GEXCOM/ADJN/GST/SC/1062/2024-ADJN AS ARBITRARY, ISSUED IN VIOLATION OF PRINCIPLES OF NATURAL JUSTICE AND IN CONTRADICTION TO THE PROVISIONS OF THE CGST ACT.

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THIS PETITION, COMING ON FOR PRELIMINARY HEARING, THIS DAY, ORDER WAS MADE THEREIN AS UNDER: CORAM: HON'BLE MR JUSTICE S.R.KRISHNA KUMAR

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ORAL ORDER

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In this writ petition, the petitioner seeks the following reliefs:

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a. To issue order(s) or directions in the nature of Certiorari Quashing the impugned Order-in-Original No. 118/2024/JC-1 dated 10.12.2024 issued in FORM GST DRC-07 at Annexure-A File No. GEXCOM/ADJN/GST/JC/1062/2024-ADJN as arbitrary, issued in violation of principles of natural justice and in contradiction to the provisions of the CGST Act;

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b. To issue an order or direction in the nature of a Mandamus, stating that the Respondent has erred in the computation of tax liability by treating the nationwide turnover of the Petitioner as the turnover of the state.

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c. To issue order(s), directions or any other relief as this Hon'ble Court deems fit and proper in the facts and circumstances of the case in the interest of justice.

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Heard the learned counsel for the petitioner and the learned Additional Government Advocate for respondent and perused the material on record.

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A perusal of the material on record will indicate that the petitioner filed its Return for the financial year 2017-18. The Principal Director of Audit, through Audit Observation No.53(OBS447851), identified discrepancies in the taxable turnover as per Form GSTR-9C and sought an explanation vide letter dated 14.11.2022. The petitioner submitted a detailed reply dated 25.03.2023 stating that the Nation wide turnover has been inadvertently reported in the place of the turnover of the state. Subsequently, the respondent, without considering the reply submitted, determined the tax liabilities and issued DRC-01A dated 29.07.2024. The respondent further issued Show Cause Notice in DRC-01 dated 02.08.2024. The petitioner submitted a detailed response to the notice, explaining that the mismatch occurred as 2017-18 was the first year for filing GSTR-9 and GSTR-9C after the introduction of GST. Additionally, GSTR-9C for all states was submitted to the Respondent and the reply along with the relevant documents was uploaded on the GST Portal.

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NC: 2025:KHC:11397 WP No. 4419 of 2025

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4. Subsequently, the Respondent vide email informed the

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petitioner that the personal hearing scheduled for 18.09.2024, as per the instructions of the Joint commissioner, the same was postponed to a later date. Subsequently, the respondent issued notices dated 16.10.2024 and 25.10.2024 intimating that personal hearings would be conducted on 24.10.2024 and 20.11.2024 respectively. However, these notices did not bear the Document Identification Number (DIN) as mandated by Circular No.128/47/2019—GST dated 23.12.2019. Furthermore, the petitioner did not receive any intimation regarding the third personal hearing. Pursuant to the same, the respondent without considering the reply filed by the Petitioner and not providing the Petitioner a sufficient opportunity of personal hearing u/s. 75(4) of the act proceeded to pass the impugned order at Annexure A dated 10.12.2024, which is assailed by the petitioner by way of the present petition.

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Learned counsel for the petitioner submits that the Petitioner had filed its reply to the show-cause notice dated 02.08.2024 and the respondent without considering the said reply and without granting an opportunity of personal hearing has passed

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the impugned order at Annexure – A dated 10.12.2024 and the impugned order deserve to be quashed and the matter is remitted back to the respondent for reconsideration of the matter afresh in accordance with law by providing an opportunity to the petitioner to submit a reply to the show cause notice/ produce necessary documents and thereafter to pass appropriate orders.

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Per contra, learned Additional Government Advocate for respondent would support the impugned order and submit that there is no merit in the petition and the same is liable to be dismissed, especially when the petitioner did not exercise his due diligence in participating in the impugned proceedings.

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A perusal of the material on record including the impugned order will indicate that it is an undisputed fact that the petitioner filed its Reply to the show-cause notice and the impugned order has been passed without granting an opportunity to the petitioner to produce necessary documents. Under these circumstances, in view of the Respondent failing to provide a reasonable opportunity to the petitioner for personal hearing as well as to produce necessary documents, by adopting a justice oriented approach and in order to provide one more opportunity to the

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NC: 2025:KHC:11397 WP No. 4419 of 2025

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petitioner, I deem it just and appropriate to set aside the impugned order and remit the matter back to the respondent for reconsideration afresh in accordance with law by issuing certain directions.

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In the result, I pass the following:

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ORDER

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i) The Writ Petition is allowed ;

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ii) The impugned order passed by respondent at Annexure A dated 10.12.2024, is hereby set aside;

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iv) The petitioner shall appear before the respondent on 22.04.2025, on which date, he shall submit his reply to the show cause notice along with relevant documents.

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v) Upon the petitioner submitting a reply along with relevant documents to the show cause notice, on 22.04.2025, the respondent shall afford a reasonable opportunity to the petitioner and hear him and proceed further in accordance with law.

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Sd/(S.R.KRISHNA KUMAR) JUDGE

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MDS List No.: 2 Sl No.: 9

M/S First Cars Private Limited v. Joint Commissioner of Central Tax

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M/S First Cars Private Limited v. Joint Commissioner of Central Tax

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