M/S Arunagiri Imports and Exports Private Limited… — Writ and Judicial Review | Karnataka HC (2026)

M/S Arunagiri Imports and Exports Private Limited… — Writ and Judicial Review | Karnataka HC (2026)

What the court decided

AI extract

Outcome

Petition disposed of: the adjudication order dated 13.08.2024 (Annexure-A) under Section 73(9) of the KGST Act, 2017 is set aside and the matter is remitted to respondent No.3 for reconsideration from the stage of reply to the show-cause notice; petitioner to appear before respondent No.3 without further notice on 04.05.2026; all contentions kept open; alleged recovery to be verified by the authorities.

Issue for consideration

Whether the ex-parte adjudication order dated 13.08.2024 passed under Section 73(9) of the KGST Act, 2017 should be set aside and the petitioner afforded an opportunity to file a reply to the show-cause notice and take a stand on merits.

Court's answer

Since the adjudication order was ex-parte and the petitioner asserts it will meet the grounds raised in the show-cause notice with appropriate material, the ends of justice are met by setting aside the order of adjudication dated 13.08.2024 passed under Section 73(9) and remitting the matter to respondent No.3 for reconsideration from the stage of reply to the show-cause notice.

Ratio / Principle

The order of adjudication at Annexure-A is set aside and the matter is remitted to the stage of reply to show-cause notice; the petitioner is to make out a reply and appear before respondent No.3 without further notice on 04.05.2026; all contentions are kept open.

Key takeaways

The petitioner's assertion of recovery pursuant to the impugned order is to be verified by the authorities, and the petitioner is directed to correct the description of respondent No.3 in the cause-title.obiter¶43

Detailed headnote1 paragraphs

GST / Karnataka - Adjudication under S.73(9) of the KGST Act, 2017 - Order dated 13.08.2024 (Ref. ZD290824048113C) passed ex-parte without any reply to the show-cause notice regarding exempted turnover declared in GSTR3B - Petitioner pleaded bonafide lapse due to business loss and sought an opportunity to reply on merits - Writ petition under Article 226 disposed of: impugned order set aside and matter remitted to respondent No.3 for reconsideration from the stage of reply to show-cause notice - Petitioner to appear on 04.05.2026 without further notice - All contentions kept open - Alleged recovery pursuant to the impugned order to be verified by the authorities.

NC: 2026:KHC:17973 WP No. 19907 of 2025

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HC-KAR

IN THE HIGH COURT OF KARNATAKA AT BENGALURU

DATED THIS THE 2^ND DAY OF APRIL, 2026

BEFORE

THE HON'BLE MR. JUSTICE S SUNIL DUTT YADAV WRIT PETITION NO. 19907 OF 2025 (T-RES)

BETWEEN:

M/S. ARUNAGIRI IMPORTS AND EXPORTS PRIVATE LIMITED, REGISTERED UNDER COMPANIES ACT,2013 CIN : U51109KA2015PTC079921, GSTN : 29AANCA4063H1ZG, SHED NO.01, NEAR APC CIRCLE, CMR LAYOUT, BENGALURU - 560 105, FOR THE TAX PERIOD 2019-20,

Digitally signed by MAMATHA R Location: HIGH COURT OF KARNATAKA

REPRESENTED BY ITS DIRECTOR, SHRI. SUDHINDRA SRIRAMA RAI, AGED ABOUT 41 YEARS, S/O SRIRAMA MANJANNA RAI, RESIDING AT NO.41, INEST PENINSULA IGGALUR, CHANDAPURA, ANEKAL, BANGALORE - 560 081.

…PETITIONER

(BY MS. MONIHSA H.L., ADVOCATE FOR SRI. SATHYANARAYANA T.R., ADVOCATE)

AND:

THE STATE OF KARNATAKA, REPRESENTED BY SECRETARY, DEPARTMENT OF COMMERCIAL TAX, VIDHANA SOUDHA, BANGALORE - 560 001.

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DEPARTMENT OF COMMERCIAL TAXES (KARNATAKA), KALIDASA ROAD, VANIJYA THERIGE KARYALAYA, GANDHI NAGARA, BENGALURU - 560 009, REP. BY ITS COMMISSIONER.

THE ASSISTANT COMMISSIONER OF COMMERCIAL TAXES, (AUDIT)-4.4, DGSTO - 04, 5^TH FLOOR, B.M.T.C. COMPLEX, KORAMANGALA, BANGALORE - 560 095.

…RESPONDENTS

(BY SRI. K. HEMA KUMAR, AGA)

THIS W.P. IS FILED UNDER ARTICLE 226 OF THE CONSTITUTION OF INDIA PRAYING TO SET ASIDE THE IMPUGNED ORDER DATED 13-08-2024 UNDER SECTION 73(9) OF THE KGST ACT-2017 IN REFERENCE NO.ZD290824048113C BY THE ASSISTANT COMMISSIONER OF COMMERCIAL TAXES, AUDIT-4.4 BY REMANDING BACK THE RESPONDENT NO.3 WITH A DIRECTION FOR A FRESH ORDER WHICH HAS BEEN PRODUCED AT ANNEXURE-A DATED 13.08.2024 AND ETC.

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

CORAM: HON'BLE MR. JUSTICE S SUNIL DUTT YADAV

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NC: 2026:KHC:17973 WP No. 19907 of 2025

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ORAL ORDER

The petitioner has filed the present petition seeking

for setting aside the order at Annexure-A dated 13.08.2024 passed under Section 73(9) of the Karnataka Goods and Service Tax Act, 2017 (for short 'the Act'). The petitioner has also sought for setting aside of the demand raised pursuant to the order at Annexure-A.

It is the case of the petitioner that the respondent authority has concluded the proceedings initiated against the petitioner by way of an adjudicatory order, which in-effect is an ex-parte order without benefit of any reply to the show-cause notice. It is submitted that the petitioner's business was under loss and due to bonafide lapse the petitioner was not able to make out a reply.

It is further submitted that there are certain recoveries pursuant to the impugned order and the petitioner may be granted an opportunity to take stand on merits by way of reply to the show-cause notice, by

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setting aside the impugned order and granting an opportunity. It is asserted that the petitioner would meet the grounds raised in the show-cause notice by placing appropriate material before the authority.

Perused the order of adjudication. It is noticed that the show-cause notice was issued on the premise that the petitioner has not submitted documents in support of the exempted turnover as declared in GSTR3B. The authorities have noticed that the petitioner has not submitted any documents in support of declared exempted turnover in GSTR3B. It is also observed in the impugned order that the petitioner has not filed any reply nor discharged payment voluntarily.

In light of the assertion of the petitioner that the petitioner would meet the grounds raised in the showcause notice and observing that the order passed is an ex-parte order, it would meet the ends of justice by setting aside the order of adjudication passed under

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Section 73(9) of the Act dated 13.08.2024 and remitting the matter back to respondent No.3 for reconsideration from the stage of reply to show-cause notice.

Accordingly, the order of adjudication at Annexure-A is set aside and the matter is remitted to the stage of reply to show-cause notice. The petitioner to make out reply to the show-cause notice. The petitioner to appear before respondent No.3 without further notice on 04.05.2026. All contentions are kept open.

The assertion of the petitioner that there has been recovery pursuant to the impugned order of adjudication, such matter to be verified by the authorities. The petitioner to correct the description of respondent No.3 in the cause-title.

Accordingly, petition is disposed of .

SD/(S SUNIL DUTT YADAV) JUDGE

MCR