Lti Mindtree Limited vs. State Of Karnataka - Karnataka High Court, 12 December 2025

Cause title — parties, addresses and appearances

- 1 - HC-KAR NC: 2025:KHC:53018 WP No. 14509 of 2022 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 12TH DAY OF DECEMBER, 2025 BEFORE THE HON'BLE MR. JUSTICE S.R.KRISHNA KUMAR WRIT PETITION NO.14509 OF 2022 (T-IT) BETWEEN: 1. LTI MINDTREE LIMITED A COMPANY INCORPORATED UNDER THE PROVISIONS OF COMPANIES ACT, 1956 HAVING ITS REGISTERED OFFICE AT L & T OFFICE, BALLAD ESTATE MUMBAI – 400 072. BRANCH OFFICE AT P-1 GLOBAL VILLAGE TECH PARK MYSORE ROAD, RVCE POST BANGALORE – 560 059. REP BY AUTHORITY & REP BY CEO MR. DEBASHIS CHATTERJEE. (AMENDED CARRIED OUT AS PER ORDER DATED 23.03.2023) 2. MS SAJITHA MANOJ D/O LATE SHRI SETHUMADHAVA MENON AGED ABOUT 48 YEARS NO.33, SIDHESHWARA LAYOUT SIDEDHAHALLI NEAR NMH SCHOOL, NAGASANDRA POST BANGALORE - 560 073. …PETITIONERS (BY SRI. UDAYA HOLLA, SENIOR COUNSEL, SRI. PRAKASH SHAH, SENIOR COUNSEL A/W SRI. MANU PRABHAKAR KULKARNI, SRI. MIHIR MEHTA, SRI. M.S.ANANTH, SRI. ABHILASH VAIDYANATHAN AND SRI. TANMAY RAI, ADVOCATES) AND: 1. STATE OF KARNATAKA THROUGH THE COMMISSIONER Retyped and replaced vide Court order dated 02.04.2026 Digitally signed by CHANDANA B M Location: High Court of Karnataka - 2 - HC-KAR NC: 2025:KHC:53018 WP No. 14509 of 2022 OF COMMERCIAL TAXES, COMMERCIAL TAXES DEPARTMENT, GOODS AND SERVICES TAX (GST) VANIJYA THERIGE KARYALAYA-1 1ST FLOOR GANDHINAGAR BANGALORE - 560 009. 2. ASSISTANT COMMISSIONER OF COMMERCIAL TAXES (AUDIT)- 2.5 DGSTO – 2, NO.642, 2ND FLOOR PIONEER PLAZA KENCHENAHALLI MAIN ROAD RAJARAJESHWARI NAGAR BANGALORE- 560 098. 3. COMMISSIONER OF COMMERCIAL TAXES (KARNATAKA) COMMERCIAL TAXES DEPARTMENT GOODS AND SERVICES TAX (GST) VANIJYA THERIGE KARYALAYA - 1 1ST FLOOR, GANDHINAGAR BANGALORE - 560 009. 4. DIVISIONAL JOINT COMMISSIONER (ADMINISTRATION) NO.642, 2ND FLOOR, PIONEER PLAZA KENCHENAHALLI MAIN ROAD RAJARAJESHWARI NAGAR BANGALORE – 560 098. 5. UNION OF INDIA REPRESENTED BY SECRETARY (FINANCE) DEPARTMENT OF REVENUE MINISTRY OF FINANCE, NORTH BLOCK NEW DELHI - 110 001. 6. GOODS AND SERVICES TAX COUNCIL REP. BY THE SPECIAL SECRETARY, OFFICE OF THE GOODS AND SERVICES TAX COUNCIL, SECRETARIAT 5TH FLOOR TOWER II JEEVAN BUILDING JANPATH ROAD, CONNAUGHT PLACE NEW DELHI – 110 001. 7. CENRTAL BOARD OF INDIRECT TAXES AND CUSTOMS THROUGH ITS CHAIRMAN DEPARTMENT OF REVENUE MINISTRY OF FINANCE - 3 - HC-KAR NC: 2025:KHC:53018 WP No. 14509 of 2022 NORTH BLOCK, NEW DELHI - 110 001. …RESPONDENTS (BY SMT. JYOTHI M. MARADI, HCGP FOR R1 TO R3, SRI. JEEVAN J. NEERALGI, ADV. FOR R4, R6 & R7 AND SRI. MADANAN PILLAI, CGC FOR R5) THIS W.P. IS FILED UNDER ARTICLE 226 OF THE CONSTITUTION OF INDIA PRAYING TO DECLARE THAT THE FOUR (4) NOTICES OF INTIMATION ALL DTD.16.06.2022 ISSUED BY THE R-2 TO THE PETITIONER FOR THE FINANCIAL YEARS 2017-18, 2018-19, 2019-20 AND 2020-21 BEARING ANNEXURES – A, B, C AND D ALL BEARING NO.ACCT(A)2.5/GST.74-2/ADJ-2/2022-23 AND ETC. THIS PETITION, COMING ON FOR ORDERS, THIS DAY, ORDER WAS MADE THEREIN AS UNDER: CORAM: HON'BLE MR. JUSTICE S.R.KRISHNA KUMAR

ORAL ORDER

In this petition, petitioners seek the following reliefs:

“(a) Issue a writ, order or direction declaring that the four (4) Notices of Intimation all dated 16.06.2022 issued by the Respondent No.2 to the Petitioner, for the Financial Years 2017-18, 2018-19, 2019-20 and 2020-21, being Annexure A, Annexure B, Annexure C and Annexure D all bearing No.ACCT(A) 2.5/GST.74-21 ADJ-2/2022-23 respectively, are:

- without the authority of law, wholly without and/or in excess of juri iction,

- ultra vires the scheme for the levy of GST under the Constitution of India and the provisions of the CGST, KGST Act and IGST Act,

Retyped and replaced vide Court order dated 02.04.2026 HC-KAR NC: 2025:KHC:53018 - in breach of Articles 14, 19(1)(g), 21, 265 and 300A of the Constitution of India.

(b) Issue writ of mandamus or a writ, order or direction in the nature of mandamus to the Respondents No. 2 to 4, either directly or through its officers, agents, or any representatives, not to take any further consequential, or precipitative actions in respect of the four (4) Notices of Intimation all dated 16.06.2022 Issued by the Respondent No.2 to the Petitioner, for the Financial Years 2017-18, 2018-19, 2019-20 and 2020-21, being Annexure A, Annexure B Annexure C and Annexure D, respectively, bearing No.ACCT(A)2.5/GST-74-2/ADJ-2/2022-23. (c) Issue a writ of Prohibition, or a writ, order or direction in the nature of Prohibition, restraining the Respondent No.1 to 4, either directly or through its officers or agents from taking any actions or proceedings pursuant to and/or in consequence of the four (4) Notices of Intimation all dated 16.06.2022 issued by the Respondent No.2 to the Petitioner, for the Financial Years 2017-18, 2018-19, 2019- 20 and 2020-21, being Annexure A, Annexure B, Annexure C and Annexure D, respectively, bearing No. ACCT(A)2.5/GST 74-2/ADJ-2/2022-23. (d) Issue a writ, order or direction in the nature of certiorari to quash and set aside the four (4) Notices of Intimation all dated 16.06.2022 issued by the Respondent No.2 to the Petitioner, for the Financial Years 2017-18, 2018-19, 2019-20 and 2020-21, being Annexure A, HC-KAR NC: 2025:KHC:53018 Annexure B, Annexure C and Annexure D, respectively, bearing No.ACCT(A) 2.5/9ST-74-2/ADJ-2/2022-23. (e) Issue writ of mandamus or a writ, order or direction in the nature of mandamus to the Goods and Services Tax Council (Respondent No.6): (i) to consider the Representation dated 09.07.2022 filed by the Petitioner, being Annexure P and make suitable recommendations at the earliest, as to the issues of "place of supply" and the consequent position as to the appropriate taxing juri iction in the present case, as more particularly set out in the Representation dated 09.07.2022;

(ii) to consider and expeditiously make recommendations as to how an assessee can seek recourse or relief where it has already discharged tax on a taxable event in one State and the tax on the same taxable event is also sought by another State;

(iii) to consider and make recommendations as to situations where there is double taxation by two or more States in respect of a single taxable event, what nature of set-off or refund would be available to an assessee;

(iv) to expeditiously issue appropriate instructions or advice to the State of Karnataka that the officers of the State of Karnataka (State officers) cannot juri iction in respect of the issues involving "place of supply" in terms of the consensual decision made in the 9th GST Council meeting held on 16th January 2017; and (v) to expeditiously issue appropriate instructions or advice to the State of Karnataka that no further or other actions be taken in respect of the Notices of Intimation till the issues raised in the Representation dated 09.07.2022 filed before the GST Council are finally determined by the GST Council.

(f) Issue writ of mandamus or a writ, order or direction in the nature of mandamus to the Central Board of Indirect Taxes and Customs (Respondent No.7) HC-KAR NC: 2025:KHC:53018 (i) to consider the Representation dated 09.07.2022 filed by the Petitioner, being Annexure R, expeditiously,

(ii) to issue instructions and directions under Section 168 of the CGST Act to the Central Tax Officers and all other persons employed in the implementation of the CGST Act, to the effect that consistent with the minutes of the 9th GST Council meeting, issues as regards determination of the 'place of supply’ ought to be adjudicated solely by proper officers of the Central tax administration (and not State tax officers),

(iii) to issue orders, instructions, directions under Section 168 of the CGST Act that the monetary juri ictions must be strictly adhered to by all the tax officers.

(g) Pass such further and other reliefs as this Hon’ble Court may deem fit in the facts and circumstances of the case.”

A perusal of the material on record will indicate that the petitioner-company is engaged in the business of providing I.T and I.T. enabled services to the customers abroad through Indian personnel and resources and also through its branches abroad. The petitioner-company provides I.T. and I.T. enabled services to its customers across the globe and has branches in more than 20 countries and across multiple states in India, which are registered under GST and undertake independent compliances under the GST. It is contended by the petitioner-company that when it provides I.T. and I.T. services to its customers, some work is HC-KAR NC: 2025:KHC:53018 executed by the petitioner-company through its Indian personnel / establishment (offshore location) and some work is executed at the customer’s site / office by its Branch office through personnel of branch office, who are stationed outside India (onsite location). Further, there are Master Service Agreement entered into between the Head Office (HO) of the petitioner-company at Bangalore with its overseas and domestic customers comprising of fixed price contracts and fixed monthly billings in relation to which the entire invoicing to foreign customer is done by the concerned Indian office of the petitioner-company either from the State of Karnataka or outside Karnataka while in respect of the said Master Service Agreements relating to time and material contracts, the invoicing is done by the concerned Indian office and / or the foreign branch of the petitioner-company for the respective offshore and onsite services provided by the petitioner-company as per the Master Service Agreements in pursuance of which statement of work is executed between the foreign customers either with the concerned Indian office including office located in the State of Karnataka or the foreign branch of the petitioner. HC-KAR NC: 2025:KHC:53018

The petitioner-company contends that in most cases in respect of services provided to foreign customers, the consideration for the invoices issued by the Indian office or the foreign branch of the petitioner-company are received by the foreign branch of the petitioner-company and the said consideration is entirely remitted back to India immediately. Thereafter, the Bangalore HO on an ad-hoc basis transfers certain amounts to the foreign branches as required by them for meeting their operational expenses and not for the services rendered to the customers and neither the petitioner-company’s foreign branch has issued any invoice on the petitioner-company’s HO in the State of Karnataka nor the petitioner-company’s HO has issued any self invoice in respect of services allegedly provided by the foreign branches to the Head office of the petitioner-company. It is therefore contended that the taxable value of the services allegedly provided by the said foreign branches is ‘Nil’ and no IGST is payable by the petitioner-company even if it is assumed that the foreign branches have provided services to the petitioner- company’s HO in the State of Karnataka. It is also contended that the services provided by the concerned offices / Bangalore HO to HC-KAR NC: 2025:KHC:53018 the overseas customers qualifies as ‘export of services’ which is ‘Zero rated supply’ on which no IGST is payable and in case of supply of services to the domestic customers, the concerned Indian office of the petitioner-company had raised tax invoices on the domestic customers and discharged the applicable GST on the ‘supply of services’ to the said customers.

After conducting of investigation by the respondents, the 2nd respondent issued the impugned intimations / notices at Annexure – A for the financial year / tax period 2017-18, Annexure – B for the financial year / tax period 2018-19, Annexure – C for the financial year / tax period 2019-20, Annexure – D for the financial year / tax period 2020-21 under Section 74 (5) of the CGST / KGST Act. It is the grievance of the petitioner-company that despite submitting detailed replies dated 30.06.2022 as well as representations dated 11.07.2022 and 11.07.2022, respectively to the GST Council and Central Board of Indirect Taxes and Customs, the respondents have not considered the same nor taken any decision and as such, the petitioners are before this Court by way of the present petition. HC-KAR NC: 2025:KHC:53018

Heard Sri. Udaya Holla and Sri. Prakash Shah, learned Senior Counsel for Sri. Manu P. Kulkarni, Sri. Mihir Mehta and Sri.M.S.Ananth, learned counsel for the petitioners and Smt. Jyoti M. Maradi, learned HCGP for respondent Nos.1 to 3, Sri. Jeevan J. Neeralgi, learned counsel for respondent Nos.4 to 7 and perused the material on record.

In addition to reiterating the various contentions urged in the petition and referring to the material on record, learned Senior Counsel for the petitioners would invite my attention to the material on record and submit that in its replies, representations, etc., petitioner-company had taken up various contentions including interalia contending that as per paragraph 3.7 of the CBIC Circular No.210/04/2024-GST dated 26.06.2024, which has been applied and relied upon by various High Courts including this Court in the case of M/s. Alstom Transport India Ltd., Vs. Commissioner of Commercial Taxes and others – W.P.No.1779/2025 dated 15.07.2025 and the Delhi High Court in the case of Metal One Corporation India Pvt. Ltd., Vs. Union of India - (2024) 24 Centax 13(Del) , the demand / claim made by the respondents against the petitioner-company in the impugned intimations / pre- HC-KAR NC: 2025:KHC:53018 Show cause notice deserve to be quashed. It is also submitted that under identical circumstances, the respondents accepted the explanation submitted by M/s. Infosys Limited and dropped further proceedings pursuant to identical / similar intimations issued by them to the said Company in this regard. It was therefore submitted that the impugned intimations / pre-Show Cause Notices are illegal, arbitrary and without juri iction or authority of law and contrary to the provisions contained in the CGST / KGST / IGST Act and the same deserve to be quashed.

Per contra, learned counsel for the respondents submits that since the petitioner-company had already submitted its replies dated 30.06.2022 to the impugned intimations / pre-Show Cause Notices, the respondents would consider the same and proceed further in accordance with law and the present petition may be disposed of accordingly.

Though several contentions have been urged by both sides in support of their respective claims, without expressing any opinion on the merits / de-merits of the rival contentions, having regard to the undisputed fact that the respondents, in particular, the HC-KAR NC: 2025:KHC:53018 2nd respondent had not taken any decision / passed any order pursuant to the replies submitted by the petitioner-company, I deem it just and appropriate to dispose of this petition by issuing certain directions.

In the result, I pass the following:- ORDER (i) Petition is hereby disposed of.

(ii) The petitioners shall appear before the 2nd respondent on 11.05.2026 without awaiting further notice from the 2nd respondent. (iii) Liberty is reserved in favour of the petitioner-company to submit replies, pleadings, documents etc., which shall be considered by the 2nd respondent, who shall proceed further in accordance with law and by providing sufficient and reasonable opportunity to the petitioner-company and an opportunity of providing of personal hearing and thereafter, proceed further in accordance with law bearing in mind the Circular dated 26.06.2024 and the judgment of this Court in M/s. Alstom Transport India Ltd., Vs. Commissioner of Commercial Taxes & others – W.P.No.1779/2025 dated 15.07.2025 and the judgment of the Delhi High Court in the case of Metal One Corporation India Pvt. HC-KAR NC: 2025:KHC:53018 Ltd., Vs. Union of India – (2024) 24 Centax 13(Del.) and other judgments relied upon by the petitioners. (iv) The 5th respondent is hereby directed to make available the records pursuant to investigation of Infosys Ltd., to the 2nd respondent and to the petitioner-company, so as to enable the 2nd respondent to take into account the said documents by considering the statements of the petitioner-company in this regard including the judgment rendered by this Court in M/s. Alstom Transport India Ltd., vs. Commissioner of Commercial Taxes & others – 2025 (7) TMI 1611 – KAR and the judgment rendered by the Delhi High Court in the case of Metal One Corporation India Pvt. Ltd., Vs. Union of India – (2024) 24 Centax 13(Del.). (v) Liberty is also reserved in favour of the petitioner- company to make a request before the 2nd respondent for additional documents, which shall be considered by the 2nd respondent bearing in mind the Circular, Alstom’s and Metal One Corporations’ judgments supra and other judgments and documents pertaining to Infosys Limited in accordance with law. (S.R.KRISHNA KUMAR) JUDGE Srl.