Shri.B.M.Suresh vs. The Deputy Commissioner Of Central Tax
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Cause title — parties, addresses and appearances
ORAL ORDER
The petitioner's grievance is with the Order-in-Original dated 15.02.2021 [Annexure - A] under Section 73 of the Finance Act, 1994. The impugned Order-in-Original is for the tax period 2014-15. The petitioner is served with Recovery Notice under in Form GST DRC - 13 which is dated 18.06.2026 [Annexure - B].
Ms. Rama P V, the learned counsel for the petitioner, submits that the Adjudication Order is an ex parte order and that the petitioner did not know about this order until served with the Recovery Notice under Form GST DRC - 13. On the merits and the terms for disposal of the petition, the learned counsel submits that:
[i] the petitioner has been in the business of providing manpower services, HC-KAR
CNR: KAHC010483492026 NC: 2026:KHC:39134 [ii] at the relevant time, the petitioner has rendered manpower services to M/s. Billava Association,
[iii] the petitioner had not crossed the threshold limit during the relevant tax period,
[iv] even otherwise, the liability to discharge the tax would be under the Reverse Charge Mechanism, and [v] this Court, when proceedings are initiated based on inputs received from the Central Board of Indirect Taxes and proceedings are completed without due opportunity, has interfered to restore the proceedings for due adjudication.
The learned counsel relies upon the decision of this Court in M/s. HC-KAR
CNR: KAHC010483492026 NC: 2026:KHC:39134 Commissioner of Central Tax in W.P. No.11154/2023 and connected matters dated 03.07.2024. 3. Mr. Aravind V. Chavan, the learned Standing counsel for the first to third respondents, submits that the impugned order records that the petitioner was issued with Show Cause Notice and also extended an opportunity of personal hearing and only because the petitioner has not responded either to the Show Cause Notice or to the personal hearing, the adjudication is concluded because the petitioner had not obtained the service tax registration or filed returns. However, the learned counsel cannot dispute the assertion that in very similar circumstances, because of the decision in the case of M/s. Karnataka Chinmaya Seva Trust [supra], this Court has restored the proceedings for reconsideration.
The petitioner's case that it was not aware of the impugned Order until served with Recovery Notice, is not seriously contested. The afore circumstances are considered, and this Court must opine that if indeed the petitioner can HC-KAR
CNR: KAHC010483492026 NC: 2026:KHC:39134 demonstrate that the liability to discharge the service tax would be on the recipient and that in fact it had not crossed the threshold required for the service tax registration during the relevant tax period, there could be an impact on the liability as adjudicated, and for complete adjudication, the petitioner must be extended with an opportunity but on terms. Hence, the following. ORDER
[A] The petition is allowed in-part.
[B] The impugned Order-in-Original dated 15.02.2021 [Annexure - A] and the Recovery Notice dated 18.06.2026 [Annexure - B] are quashed.
[C] The proceedings are restored to the Deputy Commissioner of Central Tax [the first respondent] calling upon the petitioner to appear before this respondent without any further notice on 05.10.2026, with liberty to the petitioner to produce all the documents HC-KAR
CNR: KAHC010483492026 NC: 2026:KHC:39134 to substantiate its defence against the proposed liability. (B M SHYAM PRASAD) JUDGE
RB
Reproduced from the public record of the Karnataka High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.