Ms Hansika Singh vs. Union Of INDIA
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Cause title — parties, addresses and appearances
ORAL ORDER The petitioners are before this Court seeking the following prayer: “(a) Issue a Writ of Certioriari quashing the Impugned order dated 29/10/2024 at Annexure A passed by the Respondent No. 3 with respect to the Petitioner No. 1's Application Reference No. AA291024033823E at Annexure B;
(b) Issue a Writ of Certioriari quashing the Impugned order dated 04/02/2025 at Annexure A passed by the Respondent No. 3 with respect to the Petitioner No. 2's Application Reference No. AA2901250945309 at Annexure C:2. (c) Restrain the Respondent No. 3 from imposing any penalties or liabilities arising from the delay in compliance attributable to the Respondent No. 3 actions in connection with Petitioner No. 1's Application Reference No. AA291024033823E at Annexure B and Petitioner No. 2's Application Reference No. AA2901250945309 at Annexure C:2. (f) Pass such other orders as this Hon'ble Court deems fit and proper in the interest of justice and equity.”
Heard Sri Rajkumar M.D., learned counsel for the petitioners, Sri Jeevan J. Neeralgi, learned counsel for the respondent Nos.1 and 3 and Smt. Jyothi M. Maradi, learned High Court Government Pleader for respondent No.2. HC-KAR NC: 2025:KHC:36004
The facts in brief, germane, are as follows: In the month of October 2024, the first petitioner applies for a fresh GST registration to secure a letter of undertaking for export of services in terms of necessary application. A show cause notice is issued to the petitioners on 17.10.2024, on the said application. The petitioners reply to the said show cause notice and despite the said reply, the proceedings were taken forward and a penalty is imposed upon the petitioners along with late fee for seeking registration of the GST belatedly. The reason for imposition of penalty is that, the petitioners had already secured a GST registration and therefore, it was the second in line.
Learned counsel appearing for the petitioners submits that no doubt, the registration under the Goods and Services Tax Act, 2017 (for short ‘the GST’) was secured, but no business was transacted under the said GST registration number. Therefore, the second registration emerges. He submits that the petitioners were under the VAT regime earlier to the regime of GST and whoever had taken the VAT registration, were automatically transposed to the GST regime. HC-KAR NC: 2025:KHC:36004 Therefore, registration of the petitioners under VAT is transposed to that of the GST registration. Notwithstanding this, the petitioners had to apply for a fresh GST registration and therefore, they applied. No fault could be found with the petitioners, much less, imposition of penalty or late fee for the next registration, as the earlier registration was already in place by operation of law. He would seek quashment of the proceedings.
Sri Jeevan J. Neeralgi, learned counsel for the respondent Nos.1 to 3 though accepts the fact that on the seizure of the VAT regime and the emerging of the GST regime, the VAT registrations would get transposed by operation of law. The petitioners need not have applied for another GST registration. If they have applied, then the law will apply, so also late fee and penalty will apply for transacting the business without GST number. In that light, he would submit that the petition be dismissed.
I have given my anxious consideration to the submissions made by the learned counsel for both the parties and have perused the material on record. HC-KAR NC: 2025:KHC:36004
The afore-narrated facts, dates and the link in the chain of events are a matter of record. The petitioners had a VAT registration is not in dispute. The GST regime springs from 04.07.2017 and on the onset of the GST regime, the VAT registrations automatically get transposed to that of the GST regime. Likewise, the petitioners’ VAT registration also stood transposed to the GST regime, but no transaction took place in the said GST registration, which was automatically transferred from the VAT registration. The petitioners then at a later point in time secured GST registration and therefore, have incurred the penalty or the late fee for having taken the registration of GST belatedly, in the year 2024-25, when admittedly were in the business from pre 2017 and post 2017 till 2025. Therefore, the petitioners shall now explain to respondent No.3 – Revenue with regard to their transacting business or otherwise, after the emergence of the GST regime, when the VAT registration of the petitioners was transposed to that of the GST registration automatically.
In the light of the observations made hereinabove, the petitioners shall submit a comprehensive reply to respondent HC-KAR NC: 2025:KHC:36004 No.3 and respondent No.3 shall consider the same and if found plausible, pass necessary order in accordance with law.
Insofar as the penalty and late fee which is in place, I deem it appropriate to arrest the same, till respondent No.3 passes necessary orders on consideration of the explanation that would be submitted by the petitioners. In the light of the arrest of penalty or late fee, no coercive steps be taken against the petitioners by the respondents – authority or the Revenue as the case would be.
For the aforesaid reasons, the following: ORDER a. The writ petition stands disposed. b. The petitioners are at liberty to submit an explanation against the penalty that is now imposed. c. Respondent No.3 shall consider the explanation and pass necessary orders in accordance with law and till then, the order of penalty gets arrested. d. All contentions and defense of both the parties shall remain open to be urged by the petitioners before HC-KAR NC: 2025:KHC:36004 respondent No.3 and respondent No.3 shall consider the same, bearing in mind the observations made in the course of the order. (M.NAGAPRASANNA) JUDGE
NVJ List No.: 1 Sl No.: 15 CT:SS
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.