M/S. Neeladri Pest Control Service vs. The Assistant Commissioner Of
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The petitioner challenged ex-parte adjudication orders under Section 73(9) and subsequent appeal rejections, which arose from an Input Tax Credit mismatch between GSTR-3B and GSTR-2A. The petitioner claimed non-receipt of notices due to reliance on an auditor and sought an opportunity to explain the mismatch with supporting documents.
Held
The High Court quashed both the ex-parte adjudication orders and the appeal rejection orders, restoring the proceedings to the first respondent. It granted the petitioner a fresh opportunity to file a response to the show cause notices and produce documents to establish the genuineness of transactions.
Key Issues
Whether ex-parte adjudication orders passed due to alleged non-response to show cause notices, and subsequent appeal rejections on limitation grounds, should be set aside to grant a taxpayer an opportunity to explain Input Tax Credit mismatches.
Sections Cited
Section 73, Section 73(9), Section 73(11), Section 73(1), Rule 142
AI-generated summary — verify with the full judgment below
Cause title — parties, addresses and appearances
ORDER IN FORM GST DRC-07 BEARING REFERENCE NO. ACCT/LGSTO- 180/ADJUDICATION/ORDER/2A VS. 3B/2023-24 DATED 28.12.2023, PASSED UNDER SECTION 73(9) OF THE CGST/KGST ACT, 2017 FOR THE TAX PERIOD 2017 TO 2018, PRODUCED AS PER ANNEXURE-D, PASSED BY THE RESPONDENT NO. 1; B) ISSUE A WRIT OF CERTIORARI AND QUASH THE FINAL ORDER IN FORM GST DRC-07 BEARING REFERENCE NO. ACCT/LSGTO- 180/ADJUDICATION/ORDER/2A VS. 3B/2023-24 DATED 25.03.2024, PASSED UNDER SECTION 73(9) OF HC-KAR NC: 2026:KHC:35043 THE CGST/KGST ACT, 2017 FOR THE TAX PERIOD 2018 TO 2019 (RELATING TO ALLEGED DIFFERENCE BETWEEN GSTR-1 AND GSTR-3B), PRODUCED AS PER ANNEXURE-L, PASSED BY THE RESPONDENT NO. 1; C) ISSUE A WRIT OF CERTIORARI AND QUASH THE FINAL ORDER BEARING NO. ACCT/LGSTO- 180/ADJUDICATION/ORDER/2A VS 3B/2024-25 DATED 03.08.2024 PASSED UNDER SECTION 73(9) OF THE CGST/KGST ACT, 2017 FOR THE TAX PERIOD 2019 TO 2020, PRODUCED AS PER ANNEXURE-Q, PASSED BY THE RESPONDENT NO. 1; D) ISSUE A WRIT OF CERTIORARI AND QUASH THE FINAL ORDER IN FORM GST DRC-07 BEARING NO. ACCT/LGSTO- 180/ADJUDICATION/ORDER/2A VS 3B/2024-25 DATED 13.02.2025, PASSED UNDER SECTION 73(9) READ WITH SECTION 73(11) OF THE CGST/KGST ACT, 2017 FOR THE TAX PERIOD 2020 TO 2021, PRODUCED AS PER ANNEXURE-V, PASSED BY THE RESPONDENT NO.
THIS PETITION, COMING ON FOR PRELIMINARY HEARING, THIS DAY, ORDER WAS MADE THEREIN AS UNDER: CORAM: HON'BLE MR. JUSTICE B M SHYAM PRASAD HC-KAR NC: 2026:KHC:35043 ORAL ORDER
The petitioner is aggrieved by [i] the Orders dated 17.09.2025 [Annexures-W to Z] rejecting the petitioner’s appeals in No. Form GST APL-04 for the tax periods 2017-18 to 2020-21 and [ii] the Adjudication Orders dated 28.12.2023 [Annexure-D] for the tax period 2017-18; 25.03.2024 [Annexure-L] for the tax period 2018-19; 03.08.2024 [Annexure-Q] for the tax period 2019-20; and 13.02.2025 [Annexure-V] for the tax period 2020-21. These impugned orders as afore are for the tax periods 2017-18 to 2020-21. The Adjudication Orders are premised in the assertion that the Show Cause Notice is issued to the petitioner, but it has filed no response.
Sri Manoj S N, the learned counsel for the petitioner, submits that the proceedings are concluded because of a mismatch between the Input Tax Credit claimed in Form GSTR-3B and available in HC-KAR NC: 2026:KHC:35043 Form GSTR-2A and that the petitioner could not respond to either the intimation in Form GST DRC- 01A or to the Show Cause Notice in Form GST DRC-
The learned counsel submits that though the petitioner has asserted that the impugned Adjudication Orders have recorded that the notices have been served through official email and uploaded on the portal there is no proof of actual service, the bona fide reason is that the petitioner had entrusted all the credentials with its auditor who had assisted in filing returns and therefore the petitioner was not communicated with the details of the Notice.
Sri Manoj S N also submits that the Board Circulars dated 27.12.2022 and 17.07.2023 are issued covering the subject tax period which envisage an opportunity to a Registered Taxable Person [RTP] to produce documents to establish the genuineness of the transactions even if those are not declared by the supplier. HC-KAR NC: 2026:KHC:35043
Sri K Hema Kumar, a learned Additional Government Advocate for the respondents, is heard for the disposal of the petition examining whether the petitioner must be extended another reasonable opportunity in view of the above. The first respondent, in the Adjudication Order dated 28.12.2023, has referred to the Show Cause Notice in GST DRC-01 dated 25.09.2023 and the opportunity being granted in the following terms: “Hence proceedings have been initiated under Section 73 of Karnataka GST Act/Central GST Act 2017 in pursuant to the authorization issued by the Joint Commissioner of Commercial Taxes [Admin], Koramangala, Bengaluru vide letter dated 01.08.2023 and issued another intimation in Form DRC-01A of Tax ascertained as being payable along with Interest under Section 73[5]. Even after intimation the taxpayer neither paid tax along with interest nor filed any suitable reply.
Hence show cause notice under Section 73(1) of KGST/CGST Act-2017 read with rule 142 of KGST/CGST Rules-2017 has been issued and HC-KAR NC: 2026:KHC:35043 summary of show cause notice is issued in Form GST DRC-01, providing one more opportunity to pay the Tax/Interest/Penalty within 30 days from the date of receipt of show-cause notie. However, the taxpayer neither paid the Tax/Penalty/Interest nor filed any submission for the showcase [sic.] notice.”
The appeals are rejected on ground of limitation observing that the delay beyond 120 days from the date of the Adjudication Order cannot be condoned in law. The petitioner’s appeals are delayed by 107 to 443 days, and the petitioner asserts that because the Adjudication orders are ex-parte, the appeals could not be filed within time. The petitioner contends that the mismatch between Forms GSTR-3B and GSTR-2A can be explained with the support of the documents, and certificates as permissible in terms of the Board Circulars. The circumstances asserted by the petitioner and the terms of the Circular persuade this Court to opine that the HC-KAR NC: 2026:KHC:35043 petitioner must have another opportunity. Hence, the following.
ORDER
The petition is allowed and the [i] Orders of rejection of the Appeals dated 17.09.2025 [Annexures-W to Z], rejecting the petitioner’s appeals in Form GST APL-04 for the tax periods 2017-18 to 2020-21 and [ii] the Adjudication Orders dated 28.12.2023 [Annexure-D] for the tax period 2017-18; 25.03.2024 [Annexure-L] for the tax period 2018-19; 03.08.2024 [Annexure-Q] for the tax period 2019-20; 13.02.2025 [Annexure-V] for the tax period 2020-21 are quashed subject to the following terms. [a] The proceedings are restored to the first respondent for due consideration.
[b] The petitioner is permitted to file response to the show cause notices, along with the HC-KAR NC: 2026:KHC:35043 certified copy of this Order and the copies of the documents to show the genuineness of the transactions along with the reconciliation, if any.
[c] The petitioner shall file such response along and produce these documents by 15.10.2026 and the first respondent shall consider the same and then conclude the proceedings by a reasoned order. (B M SHYAM PRASAD) JUDGE
AN/-
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.