Mamatha Borewell Drillers vs. The Assistant Commissioner
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Cause title — parties, addresses and appearances
ORAL ORDER
In this petition, the petitioner seeks following reliefs:
“(i) Quashing the impugned order dated 13.01.2025 bearing No.ACCT/LGSTO-152/DRC 07/3GB VS 2A/2024-25 passed by the 1st respondent under Section 73 of the Central Goods and Service Tax Act, 2017 and the Karnataka Goods and Services Tax Act, 2017 and the Integrated Goods and Services Tax Act, 2017, for the tax period 2020-21, produced as Annexure-A. HC-KAR NC: 2025:KHC:44030 (ii) Quashing the impugned summary of the demand dated 29.01.2025 bearing No.CTO/LGSTO-152/DRC-07/2024-25 passed by the 1st respondent produced as Annexure-B.
(iii) Declaring that the denial of Input Tax Credit to the petitioner solely on the basis of a mere mismatch between the details of Input Tax Credit available in its Form GSTR-2A and its Form GSTR-3B, is unconstitutional, arbitrary and ultra vires the scheme and object of the Central Goods and Services Tax Act, 2017, and Karnataka Gods and Services Tax Act, 2017;
(iv) Pass such other or further orders as this Hon’ble Court may deem fit in the facts and circumstances of the case, and in the interests of justice and equity.”
Heard learned counsel for the petitioner and learned AGA for the respondents and perused the material on record.
A perusal of material on record will indicate that pursuant to notice in Form GST DRC-01A dated 08.11.2024, the second respondent issued a show-cause notice dated 22.11.2024 under Section 73(1) of the CGST/KGST Act, 2017 alleging that there is excess claim of ITC in GSTR-3B than that of available in GSTR-2A. Since the petitioner did not submit his reply to the said show-cause notice also, the first respondent proceeded to pass the HC-KAR NC: 2025:KHC:44030 impugned order dated 13.01.2025 under Section 73(9) of the KGST Act, 2017 confirming the total demand of Rs.5,27,366/- including the tax, interest and penalty.
Learned counsel for the petitioner submits that the petitioner was never provided a copy nor afforded an opportunity to examine the purported authorization/approval issued by the Joint Commissioner of Commercial Taxes to conclude assessment under Section 73 of the Act and hence couldn't submit replies/ documents to neither the pre-intimation notice nor the show-cause notice under Section 73(1) of the CGST/KGST Act, 2017 and resultantly couldn’t contest the proceedings. Aggrieved by the said order the petitioner having no option has approached this Court by way of the present petition interalia contending that the inability and omission on the part of the petitioner to submit a reply to the show- cause notice and contest the proceedings was due to bonafide reasons, unavoidable circumstances and sufficient cause and submits that if one more opportunity is provided, by setting aside the impugned order, the petitioner would submit a reply to the show-cause notice and contest the proceedings. HC-KAR NC: 2025:KHC:44030
Per contra, learned AGA for the respondents submits that there is no merit in the petition and the same is liable to be dismissed.
Though several contentions have been urged by both sides, the counsel for the petitioner submits that petitioner was never provided a copy nor afforded an opportunity to examine the purported authorization/approval issued by the Joint Commissioner of Commercial Taxes to conclude assessment under Section 73 of the Act and the fact that the petitioner did not file its reply/ documents culminated in the impugned ex-parte order.
Under these circumstances, having regard to the specific assertion on the part of the petitioner that his inability and omission to submit replies and contest the proceedings was due to bonafide reasons, unavoidable circumstances and sufficient cause, I deem it just and appropriate to adopt a justice oriented approach and provide one more opportunity to the petitioner by setting aside the impugned orders dated 13.01.2025 remitting the matter back to the first respondent for reconsideration of the matter afresh in HC-KAR NC: 2025:KHC:44030 accordance with law from the stage of petitioner submitting reply to the impugned show-cause notice dated 22.11.2024. 8. In the result, I pass the following: ORDER (i) The petition is hereby allowed.
(ii) The impugned order dated 13.01.2025 passed by the first respondent under 73(9) of the KGST Act, 2017 at Annexure –A is hereby set aside.
(iii) The matter is remitted back to the first respondent for reconsideration afresh in accordance with law from the stage of petitioner submitting its reply to the notice dated 22.11.2024 issued under Section 73(1) of the CGST/KGST Act, 2017. (iv) The petitioner is directed to appear before the first respondent on 01.12.2025 without awaiting further notice from the first respondent.
(v) The liberty is reserved in favour of the petitioner to submit replies, documents etc., which shall be considered by the first respondent who shall provide sufficient and HC-KAR NC: 2025:KHC:44030 reasonable opportunity to the petitioner and hear them and proceed further in accordance with law bearing in mind Circular. 183/15/2022-GST.
(vi) In the event, the petitioner does not appear before the first respondent on 01.12.2025 as stated supra, present order shall stand automatically recalled without further orders. (S.R.KRISHNA KUMAR) JUDGE
CM List No.: 2 Sl No.: 8
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.