M/S Shiva Trading vs. The Assistant Commissioner Of Commercial Taxes - Karnataka High Court, 03 March 2026

Cause title — parties, addresses and appearances

- 1 - HC-KAR NC: 2026:KHC:12931 WP No. 5644 of 2026 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 3RD DAY OF MARCH, 2026 BEFORE THE HON'BLE MR. JUSTICE S SUNIL DUTT YADAV WRIT PETITION NO. 5644 OF 2026 (T-RES) BETWEEN: 1. M/S SHIVA TRADING A PROPRIETORSHIP CONCERN, REPRESENTED BY ITS PROPRIETOR SRI. ANDRALU SHIVAMURTHY, AGED ABOUT 45 YEARS, O/AT NO. 54, NAYANDAHALLI, KENGERI HOBLI, BENGALURU - 560 039 HAVING ITS PRINCIPAL PLACE OF BUSINESS AT H NO. 34/1, SALESWARA TEMPLE BEEDI, APMC MARKET, BALLARI-583 101. GSTIN. 29CWFPS8731P1ZG. … PETITIONER (BY SRI. MANOJ S N., ADVOCATE) AND: 1. THE ASSISTANT COMMISSIONER OF COMMERCIAL TAXES LGSTO-495, 872/873, RAGHAVENDRA COLONY, 2ND STAGE, ANANTHAPURA ROAD, BALLARI-583 101. Digitally signed by VIJAYA P Location: HIGH COURT OF KARNATAKA - 2 - HC-KAR NC: 2026:KHC:12931 WP No. 5644 of 2026 2. THE COMMERCIAL TAX OFFICER, LGSTO-495, BALLARI, KARNATAKA - 583 101. 3. THE COMMISSIONER OF COMMERCIAL TAXES, VANIJYA THERIGE KARYALAYA, GANDHINAGAR, BENGALURU - 560 009. … RESPONDENTS (BY SRI. HEMAKUMAR K., AGA) *** THIS W.P. IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA, PRAYING TO A) ISSUE A WRIT OF CERTIORARI OR ANY OTHER APPROPRIATE WRIT, ORDER OR DIRECTION, QUASHING THE IMPUGNED FINAL ORDER PASSED IN FORM GST DRC-07 BEARING REFERENCE NO. ACCT/LGSTO/495/B4/DRC-07/2024-25/T.NO.460 DATED 01.08.2024, ISSUED UNDER SECTION 73 OF THE CGST/KGST ACT, 2017 FOR THE TAX PERIOD APRIL 2019 TO MARCH 2020, CONFIRMING DEMAND OF RS. 24,23,729/-, PRODUCED AT ANNEXURE-A, PASSED BY THE RESPONDENT NO.1 AND ETC. THIS PETITION COMING ON FOR FRESH MATTERS LIST THIS DAY, ORDER WAS MADE THEREIN AS UNDER: CORAM: HON'BLE MR. JUSTICE S SUNIL DUTT YADAV - 3 - HC-KAR NC: 2026:KHC:12931 WP No. 5644 of 2026

ORAL ORDER

The petitioner has called in question the validity of the Order-in-Original passed under Section 73(9) of the CGST/KGST Act, 2017. The authorities have noticed that there is an excess claim of Input Tax Credit.

Further, the authorities have also found that the petitioner has paid less output tax. It is noticed that in light of the default of the petitioner in making out reply to the show cause notice, the authority has proceeded on the basis of the material available and passed the impugned order.

Learned counsel for the petitioner has submitted that the lapse in not replying to the show cause notice may be condoned, as the petitioner possesses material to meet the grounds made out in the show cause notice and explain the alleged discrepancy as noticed by the authority. HC-KAR NC: 2026:KHC:12931

Perused the order at Annexure-A. It is noticed that the authority has proceeded to complete the adjudication in view of the non-filing of objections and in the absence of a reply to the show cause notice by the petitioner. In light of the assertion of the petitioner that they have material to meet the alleged discrepancy, it will be appropriate to set aside the order at Annexure-A and remit the matter to the stage of reply to the show cause notice.

The petitioner is to put on terms by directing him to pay 10% of the demand of tax and Cess within a period of four weeks. Such payment would be subject to the adjudication to be made. The petitioner to appear before respondent No.2 without awaiting any fresh notice on 06.04.2026. 6. In light of the setting aside of the order at Annexure-A, the authority may recall the instruction for attachment of petitioner's bank account. Needless to state HC-KAR NC: 2026:KHC:12931 that if the petitioner does not appear on the date fixed for hearing, the indulgence granted by this Court will stand withdrawn.

Accordingly, the writ petition is disposed of. (S SUNIL DUTT YADAV) JUDGE SHS