M/S Yash Industries vs. The Commissioner Of Commercial Taxes
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The petitioner, M/s Yash Industries, filed a writ petition before the High Court of Karnataka challenging two orders dated February 20, 2025, passed by the Assistant Commissioner of Commercial Taxes (Respondent No. 2). These orders were an adjudication order (Annexure-E) and a summary order in Form GST DRC-07 (Annexure-F). The petitioner's primary contention was that the orders were passed in violation of the principles of natural justice, as they were not afforded an opportunity to be heard. The respondents disputed this, claiming that notice was issued but the petitioner failed to appear before the Assessing Officer. The Court noted that the order itself indicated the petitioner was not heard, making it an ex parte order.
Held
The Court held that the writ petition is allowed, albeit in part. The impugned adjudication order dated February 20, 2025, bearing No. ACCT/LGSTO-81/ORD-20/2024-25, and the summary order in Form GST DRC-07 dated February 20, 2025, bearing reference No. ZD2902250817072, passed by Respondent No. 2, were quashed. The Court found that the petitioner was not heard, and the orders were passed ex parte. Despite the respondents' contention that notice was issued, the Court noted that the order itself indicated a lack of hearing. Consequently, the matter was remitted back to the Assessing Officer to the stage of the show cause notice. The petitioner was directed to submit a reply to the show cause notice, and the concerned officer was instructed to take the proceedings to their logical conclusion. A cost of Rs. 10,000/- was imposed on the petitioner, payable to the Advocate Clerk’s Fund within four weeks.
Key Issues
1. Whether the adjudication order and summary order dated February 20, 2025, passed by the Assistant Commissioner of Commercial Taxes are liable to be quashed on the ground of violation of the principles of natural justice, specifically the right to be heard, as contemplated under the relevant provisions of the GST Act and Rules? Petitioner's Contention: The petitioner argued that they were not heard in the matter, and the impugned orders were passed in violation of the principles of natural justice. They relied on the fact that the orders themselves indicated they were not heard. Respondents' Contention: The respondents contended that notice was issued to the petitioner, but the petitioner failed to appear before the Assessing Officer. They argued that the petition should be dismissed as the petitioner did not avail the opportunity to appear when notice was issued. They did not explicitly name any specific provisions, circulars, or precedents.
Sections Cited
GST DRC-07
AI-generated summary — verify with the full judgment below
Cause title — parties, addresses and appearances
ORAL ORDER
The petitioner is before this court seeking the following prayer: a) Issue a writ of Certiorari or other appropriate writ or order, quashing the impugned adjudication order dated 20.02.2025 bearing no. ACCT/LGSTO- 81/ORD-20/2024-25 passed by the respondent No.2 vide Annexure-E.
b) Issue a writ of Certiorari or other appropriate writ or order, quashing the impugned summary order in form GST DRC 07 dated 20.02.2025 bearing reference No. ZD2902250817072 passed by respondent No.2 vide Annexure-F. HC-KAR NC: 2025:KHC:33383 c) Pass such other order or direction as this Hon’ble Court may deem fit and proper in the interest of justice and equity.
Heard the learned counsel for the petitioner and learned counsel for the respondents.
The petitioner inter alia contends that he was not heard in the matter and orders have been passed in violation of principles of natural justice.
A perusal of the documents appended to the petition would vindicate the submission of the petitioner and indicate that the petitioner was not heard in the matter. The learned counsel appearing for the respondent would, however, dispute the possession, contending that though notice was issued, the petitioner has not appeared before the Assessing Officer.
The learned counsel for the respondents would submit that the petition should be dismissed and not be entertained on the ground of violation of principles of natural justice, as the petitioner has not availed the HC-KAR NC: 2025:KHC:33383 opportunity of appearance when the notice was issued. However, the order indicates that the petitioner was not heard; therefore, it is admittedly an ex parte order.
In the light of the dispute with regard to the petitioner getting the notices and not appearing before the authority, I deem it appropriate to allow the petition, albeit in part, with imposing the cost of Rs.10,000/- to be paid to the Advocate Clerk’s Fund, within 4 weeks from the date of receipt of the copy of this order. With the aforesaid reasons, I pass the following order: ORDER i. The writ petition is allowed. ii. The impugned order dated 20.02.2025 bearing No.ACCT/LGSTO-81/ORD-20/2024-25 and Form GST DRC dated 20.02.2025 bearing reference No.ZD2902250817072 passed by respondent No.2 vide Annexures- E and F stands quashed. HC-KAR NC: 2025:KHC:33383 iii. The matter is remitted back to the hands of the Assessing Officer to the stage of the show cause notice, the petitioner shall now submit his reply to the show cause notice and concerned officer should take the proceedings to its logical conclusion. iv. Ordered accordingly. (M.NAGAPRASANNA) JUDGE
SKS List No.: 1 Sl No.: 141
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.