M/S Nest Connectivity Solutions PVT LTD. vs. The Deputy Commissioner Of Commercial Taxes (Audit)
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Cause title — parties, addresses and appearances
ORDER IS HEREWITH ENCLOSED AS ANNEXURE B AND TO ALSO QUASH THE CONSEQUENT ENDORSEMENT BY THE RESPONDENT AUTHORITY IN NO.DCCT (AUDIT)-3.3/DGSTO-3/25-26 DATED 18.7.2025 REJECTING THE REQUEST AS IMPERMISSIBLE UNDER SECTION 161 OF THE KGST/CGST ACT, 2017 WHICH IS HEREWITH ENCLOSED AS CHANDANA B M Location: High Court of Karnataka HC-KAR NC: 2025:KHC:46500 ANNEXURE D AS ILLEGAL WITHOUT THE AUTHORITY OF LAW AND AB INITIO VOID AND ETC.,
THIS PETITION, COMING ON FOR PRELIMINARY HEARING, THIS DAY, ORDER WAS MADE THEREIN AS UNDER:
CORAM: HON'BLE MR. JUSTICE S.R.KRISHNA KUMAR
ORAL ORDER
In this petition, petitioner seeks for the following reliefs:- “(a) Issue a writ of certiorari, or such other writ, Order or direction as this Hon’ble Court may deem fir and quash the order of the Adjudication in case ID No.AD290623002363C dated 31.10.2023 which order is herewith enclosed as Annexure “B” and to also quash the consequent endorsement by the Respondent Authority in No.DCCT(Audit)- 3.3/DGSTO-3/25-26 dated 18.07.2025 rejecting the request as impermissible under section 161 of the KGST/CGST Act, 2017 which is herewith enclosed as Annexure “D” as illegal without the authority of law and ab initio void; (b) Issue a writ in the nature of certiorari commanding the respondent to transmit the records of the case to the Hon’ble Court in order to satisfy that proceedings are initiated and conducted in accordance with the statutory condition proscribed under the CGST/KGST Act, 2017. HC-KAR NC: 2025:KHC:46500 (c) Grant such other consequential reliefs as this Hon’ble High Court may think fit and also the cost of this writ petition.”
Heard learned counsel for the petitioner and learned HCGP for the respondent and perused the material on record.
A perusal of material on record will indicate that pursuant to an intimation in Form GST DRC-01A dated 05.06.2023, the respondent issued a show-cause notice dated 14.08.2023 alleging that there are certain discrepancies in ITC claimed in GSTR-3B and ITC reflected in GSTR-2B. Subsequently, the respondent passed an adjudication order dated 31.10.2023 confirming a total demand of Rs.54,84,468/- along with interest and Penalty, without granting an opportunity of personal hearing to the petitioner. Thereafter, the petitioner sought for rectification of the said order, to which the respondent issued endorsement dated 18.06.2025 rectifying the total demand as Rs.40,82,360/-, aggrieved by which, the petitioner is before this Court by way of the present petition.
In addition to reiterating the various contentions urged in the petition and referring to the material on record, learned counsel HC-KAR NC: 2025:KHC:46500 for the petitioner submits that the petitioner did not receive the aforesaid notices issued by the respondents and hence could not submit reply/ documents to the same which has culminated in the impugned ex-parte order and if an opportunity is given to the petitioner to file reply/ documents to the said notices by setting aside the impugned ex-parte order the petitioner would do so and the respondent may be directed to directed to pass fresh order after considering the replies/ documents filed by the petitioner. Further, the rectification application filed by the petitioner is also not property considered by the respondent. It is further submitted that the impugned proceedings initiated pursuant to the impugned show cause notice dated 14.08.2023 is barred by limitation under Section 73(10) of the KGST Act and as such, the availability of equivalent, efficacious and alternative remedy by way of filing of an appeal under Section 107 of the CGST / KGST Act would not come in the way of the petitioner prosecuting the present petition.
Per contra, learned HCGP for the respondents – revenue submits that the period of limitation has been extended by the respondents vide Notification No. 13/2022 dated 05.07.2022, Notification Nos. 9 and 56 of 2023 dated 31.03.2023 and HC-KAR NC: 2025:KHC:46500
2023 respectively and as such, it cannot be said that the proceedings are barred by limitation.
Learned counsel for the petitioner would invite my attention to the Petition in Special Leave Appeal (C) No. 4240/2025 pending before the Apex Court in order to contend that the validity of the said Notifications are seized by the Apex Court and pending adjudication before the Hon’ble Supreme Court.
In view of the aforesaid facts and circumstances and the submissions made by both sides which will indicate that the validity of the aforesaid Notifications are seized by the Apex Court and which will have an impact / bearing on the impugned proceedings, I am of the view that one more opportunity is required to be granted in favour of the petitioner by setting aside the impugned adjudication order and remitting the matter back to the respondent for reconsideration afresh in accordance with law by issuing certain directions.
Under these circumstances, in order to avoid multiplicity of proceedings and to ensure that there are no conflicting orders, I deem it just and appropriate to direct the respondent to reconsider the matter afresh and pass a fresh adjudication order in HC-KAR NC: 2025:KHC:46500 accordance with law after disposal of Special Leave to Appeal (C) No.4240/2025 by the Apex Court.
In the result, I pass the following:- ORDER
(i) Petition is hereby allowed, subject to payment of cost of Rs.10,000/- to the Karnataka High Court Legal Services Authority, Bengaluru, within a period of six weeks from today.
(ii) The impugned order at Annexure-B dated 31.10.2023 and the impugned endorsement at Annexure-D dated 18.07.2025 passed by the respondent are hereby set aside. (iii) The matter is remitted back to the respondent for reconsideration afresh and pass a fresh adjudication order in accordance with law after disposal of SLP No.4240/2025 pending before the Apex Court.
(iv) The period between the date of the impugned order i.e., 31.10.2023 and the date on which the Apex Court disposes of the aforesaid SLP No.4240/2025 shall stand excluded for the purpose of limitation. (S.R.KRISHNA KUMAR) JUDGE BMC: List No.: 2 Sl No.: 11
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.