M/s. Andromeda Sales and Distribution Private Limited Vs Union of India

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IN THE HIGH COURT FORTHE STATE OF TELANGANA AT T{YDERABAD (Speciat Original Jurisdiction)

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TUESDAY, THE TENTH DAY OF FEBRUARY TWO THOUSAND AND TWENTY SIX

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PRESENT

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THE HONOURABLE THE CHTEF JUSTTCE APARESH KUMAR SINGH AND THE HONOURABLE SRI JUSTICE G.M. MOHIUDDIN

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WRIT PETITION NO: 3747 OF 2026

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Between:

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M/s. Andromeda Sales and Distribution Private Limited, Represented by its Aytlo11"d^sis.natory Vt^{N.rqurqu Faka, S/o: paki Sioriaiini;dd ai years} ucc. senior Vice President Reglstered office at H.No. 6-3a47n2lg, Ground Floor, Plot No. 201,Dwarkapuri-corony, punjagutta, nvoerioid - soobia

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...PETITIONER

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Union of lndia, Represented by secretary, Ministry of Finance, New Delhi 2. The Princjpal Commissioner of Central Tax (GST), Hyderabad, GST Commissionerate-S00029

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3 The Assistant commissioner of central rax (GST), Himayatnagar Division, Hyderabad-500029

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]lrg superintendent of central rax (GST), Panjagutta -l Range, Hyderabad500034

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....RESPoNDENTS

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Petition under Article 226 of the Constitution of lndia praying that in the circumstances stated in the affidavit filed therewith, the High Court may be pleased to issue any writ, order or direction more particularly one in the nature of WRIT OF MANDAMUS declaring the Show Cause Notice dated 19-07-2023, Order in Original No.1312023-24-GST dated 29-01-2024 and Summary of the Order in the Form GST DRC-07 dated 13-03-2024 issued by Respondent 3 and all consequential recovery proceedings initiated by Respondent 4 as arbitrary, illegat and in effective, as the same have been issued against a non-existent entity whose GST registration stood cancelled

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lA NO: 1 OF 2026

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petition under Section 151 CPC praying that in the circumstances^{stated in} the affidavit fited^{in support of the petition, the High Court may be pleasedto} suspend the^{proceedings under Order in OriginalNo.1312023-24-GSTdated 29-01-} 2024 atong with Summary^{of the Order in Form GST DRC-07 dated13-03-2024} issued by the Respondent^{No. 3 and consequential recovery proceedings initiated} by Respondent^{4 as arbitrary, illegal and in effective pending disposal of the above} writ petition.

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Counsel for the Petitionen'SRl^{VIJAYAKUMAR.P.B. REPRESENTS} SMT. A. V. S. LAXMI

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Counsel for the Respondent No.1: SRI^B. MUKHERJEE,APPEARS^FOR SRI N. BHUJANGA RAO Deputy Solicitor General of lndia

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Counsel for the Respondent Nos.2 to 4: SRI^D. RAGHAVENDAR RAO,^{SC FOR} CENTRAL BOARD OF INDIRECT TAXES AND CUSTOMS

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The Gourt made the following: ORDER

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IN T}IE I{IGII COTJRT FORTTIE STATE OF^TELANGANA AT ITYDERABAD

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THE HON'BLE THE CHIEF JUSTICE SRI APARESII KI'MAR SINGH AND THE HON'BLE SRI JUSTICE G.M.MOHIUDDIN

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WRIT PETITI No. 3747 of 2026

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DATED z 10.02.2026

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Between:

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IWs. Andromeda Sales and Distribution Private Limited

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Petitioner

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AND

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Union of India, represented by Secretary, Ministry of Finance, New Delhi and three others

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Respondents

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ORDER:

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Dr. Vijaya Kumar P.8., learned Senior^{Counselrepresents}

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Smt. A.V.S. Laxmi, learned^{counselfor petitioner-}

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Sri B. Mukherjee,^{learned counsel appears for}

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Sri N. Bhujanga Rao,^{learned Deputy Solicitor Generalof India,} for respondent No.1.

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Sri D. Raghavendar^{Rao, learnedSenior Standing Counsel}

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tI,

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for Central Board of Indirect Tores^{and Customs appears for}

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respondent Nos.2 to^4.

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II

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HCJ (AKrS, J) &^GMM,J W.P.No.3747^{ot 2026}

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2 The ground on^{which challenge to the impugnedshqw} cause notice dated^{19.07.2023;Order-In-Originaldated} 29.0t.2024 and Summary of^{the order in FoRMGST DRC-07} dated 13.03 .2024 is that after^{amalgamation of the petitioner} company pursuant to the sanction^granted by^{the learned} National Company Law Tribunal on 04.01.2021, the^erstwhile company changed its name to lWs.Andromeda Sales and Distribution Private Limited i.e., the petitioner company and obtained a fresh Certificate of Incorporation on 07.04.2021 and also new GSTIN Registration bearing No.36AAECC0028RIZ1. The impugned proceedings relate to the Financial Year 2017-18 against the erstwhile GSTIN Registration Number, before the merger of the erstwhile company into the petitioner company. The impugned show cause notice and the order-In-original are therefore nullity as against the petitioner company. Therefore, the petitioner company has preferred the present Writ Petition on 05.02.2026.

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The^{\earnedcounsel for the petitioner cornpanysubmits} J company^{was unaware of the show catlse} that^{the Petrtioner}

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notice^{and the proceedings.Therefore,the delay in approaching} the^{writ Court occurred'}

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4.ThelearnedcounselforrespondentNos.2to4submitsthat theplearelatingtotheamalgamationofthepetitionercompany andinitiationoftheproceedingsfortheFinancialYear201t7.|8 ontheerstwhilecompanyareallmattersrelatingtothefactson appreciation^{of which' appropriate orders can be passed by the} appetlate^{authoritybeforewhom the petitionercompany should} haveapproached.ItissubmittedthatifthisCourtdirectsthe petitioner^{companyto approachthe appellate authority withina} stricttimeframewithpre-deposit,theappellateauthoritywould consider^{the questionof delay sympatheticallytaking into} accountthecircumstancethatthe.proceedingsareallegedly against^{the erstwhilecompanyhaving a cancelledGSTIN} Registration'

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5.^{The learned Senior Counselfor the petitionercompanyhas} placedrelianceonthedecisionoftheApexCourtinPrineipal Commissioner^{of Income Tax' New Delhi v' MarutiSuzuki}

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HCJ (AKrS, J) &^GMII{,J W.P.No.3747 of^2O26

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(India) Limitedr in relation to^{the proceedings for reopeningof} a assessment against non-existing entity which stood amalgamated in another. However, it is^{also to be taken note of} that the said case had^gone to the Apex Court^{after the learned} Delhi High Court^{had upheld the decision of the IncomeTax} Appellate Tribunal whereby the assessment made in the name of Suzuki Powertrain India Limited for Assessment Year 2012-13 was held to be nullity since the company had amalgamated with Maruti Suzuki (India) Limited under an approved scheme of amalgamation. Therefore, it.is apparent that in the case of Maruti Suzuki (lndia) Limited also, the parties had availed the statutory forum questioning the assessment proceedings against a nonexisting or entity which stood amalgamated in another.

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Refbrence has also been made to the judgment of High Court of Delhi (D.8.) in HCL Infosystems Ltd v. commissioner of state Tax and another2, wherein the matter was taken to the Wfit COUrt^{againstthe impugnedshow causenotice and Order-}

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ln-0riginal^also

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I rzO20) 18^SCC 331 (Del)⁶⁰⁰⁶ z 2924laurSutt

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HCJ^{(AKrS,J) & GMM'J} 5 w-P.No.3747 of^2O26

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From the averments^{made in the writ petition, it appeafs} that petitioner changed its name^{from CASA Capital} Management Private Limited^{incorporated in 2010, to its present} name in 2014. It operated^{as a direct sale agencyand earned} commission income^{by way of loan processingheferral fees. It} was associated with^{various financial institutions. One} Geosansar Advisors^{PrivateLimited (GAPL)incorporated in} 2008 in the^{business of providing comprehensive financial} inclusion, literacy^{and educationservicesacquiredmajority} shareholding^{of lWs.Andromeda Sales and DistributionPrivate} Limited in^{2014 (ASDPL) from its erstwhileshareholders and} proposed to^{consotidate businessesby amalgamation as a single} entity later^{on. The Scheme of Amatgamation was approved by} National Company^{Law Tribunal (NCLT) vide order dated} 04.0 1.2021.^{The petitioneramalgamatedwith its holding} company.^{The amalgamatedcompany changedits name from} GAPL to^{ASDPL, i.e., petitioner company.It also obtaineda} certificate^{of Incorporationdated 07.04.2021and New GST} registration^{with effect from 02.07.2021. Pursuantto the same'}

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HCJ (AKrS,^{Jl & GMM'J} W.P.No.3747^{of 2026}

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its old GST^{registrationwas cancelled with effect from}

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07 .02.2023.

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A perusal of^{the show cause notice shows that the} petitioner was found to^{have claimedan irregularinput tax credit} for the period July,^{2017 to March,201,8,which was pointed out} by the Range Officer^{vide ASMT-l0,dated 1,3.06.2022 in} contravention of Section L6(2) read with^{Section 4l of the} CGST/TSGST Act,2017 and Section^{20 of the IGST Act,2017.} The assessee did not furnish valid reasons or^documentary evidence in support of the defence. Therefore, the^petitioner was directed to show cause as to why they should not demand the tax, interest and penalty. The petitioner was directed to produce all the evidence upon which they need to rely in support of the defence and also indicate in the written reply whether they need personal hearing before the case is adjudicated. If the petitioner failed to mention in the written reply, it would be presumed that they^{do not desire a personal hearing'}

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HCJ^{(AKrS,J) & GMM'J} W.P.No.3747^{of 2026}

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A perusal of the^{impugned order-in-originatshows tha! the} petitioner in his reply to the intimation in ASMT-l0^{had vide} ASMT-11 dated 28.06.2022^{and 16.03.2023 submitted that they} have reported tTC^{credit amountingto Rs.2,24,72,6081-in} GSTR 3B^{returns, whereasin GSTR2A it was Rs.2,03,57,4161--} Hence, there^{was a difference of ITC Rs.21 ,15,1921- in} comparison to^{GSTR 24. Theyhave providedthe list of those} supplies of^{which ITC is not reflecting in GSTR 2A in annexure} to their letter.^{The petitioneralso submittedthat they had taken} ITC based^{on the vatid invoices under Section 16(2) of the} CGST Act,^{2017 and provided copies of those invoices'They} had paid^{the tax charged in respective invoices to the suppliers} of services^{and/or goods.Hence, they were eligible to take ITC} on such^{invoices which were available with them' The proper} officer^{recorded that the tax payer had failed to submit the} reasons for^{non-compliance of Section 16(2)(c)of the CGST} Act, 201 7^{andfrom the differencebetweenGSTR 38 and GSTR} 2A, itwas^{evident that the ta)< has not beenpaid by the supplier'} Hence, its^{contention that they have not availed any ineligible}

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HCJ (AKrS, Jl & GMM, J 8 W-P-No.3747 of 2O26

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excess ITC is not tenable. The petitioner was given an opportunity to provide documentary evidence in terms of Circular dated 27.12.2022 vide range office letter dated 1 8.01 .2023, 25.01 .2023 and 07.02.2023 but the taxpayer had not submitted any document/reply in that regard. It further appears that no reply to the show cause notice was filed even after lapse of considerable time. Even after opportunities of personal hearing granted to the taxpayer on I 6.10.2023, 13.12.2023 and 26.12.2023, they failed to appear before the adjudicating authority. The adjudicating authority, therefore, proceeded to confirm the demand of tax, interest and penalty by the impugned order-in-original dated 29.01 .2024.

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From perusal of the impugned show cause notice and the order-in-original, it appears that even after amalgamation of the petitioner company on 04.01 .2021, the petitioner had responded to the intimation under ASMT- l0 vide ASMT- l l, dated 28.06.2022 and,16.03^{.2023 stating that they had taken ITC based} on valid^{invoices under Section 16(2)(c) of the CGST Act,201.7} andprovidedcopiesofthoseinvoicesintheannexuretothe

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HCJ^{(AKrS,Jl & GMM, J} W-P.No.3747 of²⁰²⁶

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reply. They had taken^{a ptea that they are etigible to take ITC in} lieu of the tax charged in respective invoices to the suppliers which were available with them. The^{petitionerhad not taken a} plea that the petitioner had taken a^{new Certificate of} Incorporation on 07.04^{.2021 in the name of l\zTs.Andromeda} Sales and Distribution^{PrivateLimited pursuant to the} amalgamation of^{the companyas per the sanction grantedby the} learned NCLT on^{04.01.2021.They also did not point out that} they had taken a^{new GST registration. Petitioner did not} respond to the^{show cause notice, neither participated in} personal hearing.

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1 1. At this^{stage in the writ proceedings,the petitioner has} taken such^{a plea. The instantissue thereforeinvolves questions} of fact in^{the light of the plea of amalgamationraised by the} petitioner for^{the first time before the writ court' We therefore} consider it^{properto relegatethe petitioner to avail appellate} remedy in^{respect of its grievances. If such an appealis filed} within a^{period of two (2) weeks with statutorydepositand a} delay condonation^{application, the appellateauthority would}

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HCJ (AKS, J)^{& GMM, J} W.P.No.3747 of^2O26

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consider the^{questionof delay sympatheticallytaking into} account the facts and^{circumstances taken on behalf of the} petitioner. If he is satisfied^{with the explanation, then, he would} proceed to decide the matter on^{meritsin accordancewith law.} Let it be made clear that^{we have not made any comment on the} merits of the case of the parties.

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Accordingly, the instant Writ Petition is disposed of. There shall be no order as to costs.

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Miscellaneous applications, if any pending, shall stand

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closed

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SD/-C.DEEPIKA REGISTRAR

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//TRUE COPY//

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SECTION OFFICER