Madineni Srinivas vs. The State Of Telangana

Facts

The petitioner, Madineni Srinivas, filed a writ petition challenging three orders in FORM GST DRC-07 dated 06.10.2025, passed by the Assistant Commissioner (State Tax) for the financial years 2020-21, 2021-22, and 2022-23, under Section 74 of the CGST/TSGST Acts. The petitioner contended that these orders were illegal, arbitrary, and violative of natural justice. The core of the dispute was the alleged failure of the assessing officer to consider a sub-licence agreement dated 20.10.2019 and other documents, which, according to the petitioner, demonstrated that GST on royalty under the reverse charge mechanism had been duly paid by M/s. DRN Infrastructure Pvt. Ltd. for the specified periods. The petitioner sought quashing of the orders or, in the alternative, a remand for fresh adjudication.

Held

The High Court disposed of the writ petition without delving into the merits of the parties' claims. The Court noted the petitioner's contention that the sub-licence agreement and other documents, along with the records of M/s. DRN Infrastructure Pvt. Ltd., would show that GST on royalty under the reverse charge mechanism for the financial years 2020-21, 2021-22, and 2022-23 had been duly paid. The Court also considered the respondents' submission that if it was a case of inadvertent omission, the proper officer could exercise powers of rectification under Section 161 of the Act. Accordingly, the Court granted liberty to the petitioner to approach the proper officer with a rectification application concerning the grievances raised. The Court directed that if such an application were made within the prescribed time, the proper officer would examine it in accordance with the law and take a decision within a reasonable time. No costs were awarded.

Key Issues

1. Whether the Assistant Commissioner (State Tax) erred in passing orders in FORM GST DRC-07 for FY 2020-21, 2021-22, and 2022-23 under Section 74 of the CGST/TSGST Acts without considering the sub-licence agreement dated 20.10.2019 and other documents, which allegedly prove the payment of GST on royalty under reverse charge by M/s. DRN Infrastructure Pvt. Ltd.? Petitioner's Contention: The petitioner argued that the sub-licence agreement and other submitted documents, along with the records of M/s. DRN Infrastructure Pvt. Ltd., would establish that the GST on royalty under the reverse charge mechanism for the financial years 2020-21, 2021-22, and 2022-23 was duly paid. The petitioner asserted that the assessing officer's failure to acknowledge this fact in the orders under Section 74 constituted an error or omission. The petitioner prayed for a remand or liberty to seek rectification under Section 161 of the Act. Respondents' Contention: The learned Special Government Pleader for State Tax submitted that if the omission was inadvertent, the proper officer could exercise powers of rectification under Section 161 of the Act. Therefore, the petitioner should be directed to approach the proper officer, as it was still within the time limit from the date of the order.