M/S Mgr Stone Crisher vs. The Assistant Commissioner

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WP/102199/2025HC KarnatakaGSTCNR KAHC02005199202526 June 2025Bench: PRADEEP SINGH YERUR7 pages
For Petitioner: SRI. H.R. KAMBIYAVAR, ADVOCATEFor Respondent: SRI. S.V. MAGADUM, AGA FOR R1 TO R3 AND R5; SRI. VENKATESH M. KHARVI, ADVOCATE FOR R4

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Heard together (2 matters)

WP No. 102199 of 2025
WP No. 102258 of 2025

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Cause title — parties, addresses and appearances
- 1 - HC-KAR NC: 2025:KHC-D:8097 WP No. 102199 of 2025 C/W WP No. 102258 of 2025 IN THE HIGH COURT OF KARNATAKA, DHARWAD BENCH DATED THIS THE 26TH DAY OF JUNE 2025 BEFORE THE HON'BLE MR. JUSTICE PRADEEP SINGH YERUR WRIT PETITION NO. 102199 OF 2025 (T-RES) C/W WRIT PETITION NO. 102258 OF 2025 (T-RES) IN WP NO.102199/2025 BETWEEN: M/S. MGR STONE CRISHER R/O: NO.192 SUPA ROAD, RAMNAGAR, UTTAR KANNADA-581453. REPRESENTED BY ITS PARTNER SMT. MAHADEV GUNDU GANDHALE AGED ABOUT 63 YEARS, GSTIN.29ABKFM0348N1ZQ. …PETITIONER (BY SRI. H.R. KAMBIYAVAR, ADVOCATE) AND: 1. THE ASSISTANT COMMISSIONER COMMERCIAL TAXES (ENFORCEMENT), ASHWINI CIRCLE SIRSI, UTTAR KANNADA-581453. 2. THE ASSISTANT COMMISSIONER OF COMMERCIAL TAXES, DC COMPOUND, DGSTO, DHARWAD-580001. 3. THE DEPUTY COMMISSIONER OF COMMERCIAL TAXES (AUDIT-4), PB ROAD, NAVANAGAR, HUBBALLI-580025. 4. THE UNION OF INDIA, MINISTRY OF FINANCE, DEPARTMENT OF REVENUE, VIJAYALAKSHMI M KANKUPPI Location: HIGH COURT OF KARNATAKA DHARWAD BENCH - 2 - HC-KAR NC: 2025:KHC-D:8097 WP No. 102199 of 2025 C/W WP No. 102258 of 2025 THROUGH ITS SECRETARY (REVENUE), NORTH BLOCK, NEW DELHI-110001. 5. THE STATE OF KARNATAKA DEPARTMENT OF FINANCE (GST WING), REPRESENTED BY ITS SECRETARY, VIDHANA SOUDHA BENGALURU-560001. …RESPONDENTS (BY SRI. S.V. MAGADUM, AGA FOR R1 TO R3 AND R5; SRI. VENKATESH M. KHARVI, ADVOCATE FOR R4) THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION PRAYING TO ISSUE A WRIT OF CERTIORARI OR A WRIT IN THE NATURE OF CERTIORARI TO QUASH THE NOTIFICATIONS AND THE CIRCULAR INSTRUCTIONS THAT HAVE LED TO LEVY OF GST ON THE AMOUNT OF ROYALTY SPECIFICALLY INCLUDING CIRCULAR BEARING NO.164/20.2021-GST DATED 06.10.2021 VIDE ANNEXURE-D AND ISSUE A WRIT OF CERTIORARI OR A WRIT IN THE NATURE OF CERTIORARI TO QUASH THE IMPUGNED ORDER DATED 15.11.2024 IN REF. NO. DCCT/AUDIT-4/HBL/GST/2024-25/B- PASSED BY 3RD RESPONDENT FOR THE FINANCIAL YEAR 2022-23, VIDE ANNEXURE-J, IN SO FOR AS PETITIONER FIRM IS CONCERNED. IN WP NO.102258/2025 BETWEEN: M/S. MAK STONE CRUSHER AND M-SAND UNIT R/O: NO. 24 ARUNODAY, RANADSE ROAD, NEAR 2ND RAILWAY GATE, TILAKWADI, BELAGAVI-590006, REPRESENTED BY ITS PROPRIETOR, SMT. MANGALA ARUN KAKATKAR AGED ABOUT 72 YEARS, GSTIN: 29AFEPK2955F1ZD. …PETITIONER (BY SRI. H.R. KAMBIYAVAR, ADVOCATE) - 3 - HC-KAR NC: 2025:KHC-D:8097 WP No. 102199 of 2025 C/W WP No. 102258 of 2025 AND: 1. THE ASSISTANT COMMISSIONER OF COMMERCIAL TAXES (AUDIT)-5, “SUMOULYA SOUDA” 3RD FLOOR, CLUB ROAD, BELAGAVI-590001. 2. UNION OF INDIA, MINISTRY OF FINANCE, DEPARTMENT OF REVENUE, THROUGH ITS SECRETARY (REVENUE). NORTH BLOCK, NEW DELHI-110001. 3. THE STATE OF KARNATAKA DEPARTMENT OF FINANCE (GST WING) REPRESENTED BY ITS SECRETARY, VIDHANA SOUDHA, BENGALURU-560001. …RESPONDENTS (BY SRI. S.V. MAGADUM, AGA FOR R1 AND R3; SRI. VENKATESH M. KHARVI, ADVOCATE FOR R2) WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION PRAYING TO ISSUE A WRIT OF CERTIORARI OR A WRIT IN THE NATURE OF CERTIORARI TO QUASH THE NOTIFICATIONS AND THE CIRCULAR INSTRUCTIONS THAT HAVE LED TO LEVY OF GST ON THE AMOUNT OF ROYALTY SPECIFICALLY INCLUDING CIRCULAR BEARING NO.164/20.2021-GST DATED 6.10.2021 VIDE ANNEXURE-D AND ISSUE A WRIT OF CERTIORARI OR A WRIT IN THE NATURE OF CERTIORARI TO QUASH THE IMPUGNED ORDER DATED 28.03.2024 IN REF. NO.ACCT/A-05/S- 73/2023-24/B PASSED BY 1ST RESPONDENT FOR THE FINANCIAL YEAR 2019-20, VIDE ANNEXURE-G, IN SO FOR AS PETITIONER FIRM IS CONCERNED. THESE PETITIONS COMING ON FOR ORDERS THIS DAY, ORDER WAS MADE THEREIN AS UNDER: - 4 - HC-KAR NC: 2025:KHC-D:8097 WP No. 102199 of 2025 C/W WP No. 102258 of 2025

ORAL ORDER

(PER: THE HON'BLE MR. JUSTICE PRADEEP SINGH YERUR)

1.

Sri.H.R.Kambiyavar, learned counsel the petitioner and Sri.S.V.Magadum, learned Additional Government Advocate for respondent Nos.1 to 3 and 5 and Sri.Venkatesh M Kharvi, leaned counsel for respondent No.4, have appeared in person.

2.

The present petition is filed seeking a writ of certiorari to quash the Notifications and the circular instructions that have led to levy of GST on the amount of royalty specifically included circular bearing No.164/20.2021-GST dated 06.10.2021 vide Annexure –D and to quash the impugned Order dated 15.11.2024 passed by respondent No.3 for the Financial year 2022- 2023. 3. Heard Sri.H.R.Kambiyavar, learned counsel the petitioner and Sri.S.V.Magadum, learned Additional Government Advocate for respondent Nos.1 to 3 and 5 HC-KAR NC: 2025:KHC-D:8097 and Sri. Venkatesh M Kharvi, leaned counsel for respondent No.4. 4. Learned counsel for the petitioner contends that petition be allowed referring the judgment of the Hon’ble Apex Court.

5.

Per contra, learned AGA relies on the judgment of the Co-ordinate Bench of this Court in WP.No.100875/2024 and the judgment of this Court in WP.No.103311/2025 without adverting to the merits of the matter. It is contended by the learned counsel for the respondents that there is an appeal provision specifically provided under Section 107 of the Karnataka Goods and Services Tax Act, 2017 and therefore, the petitioner would have to be relegated to the appellate remedy and all the contentions raised herein could be adverted to by the petitioner before the appellate authority. The judgment of the apex Court is not disputed, as certain guidelines wherein para 25(a), (b) and (c ) is held as under: HC-KAR NC: 2025:KHC-D:8097

25.

Bearing in mind the consequences that would emanate from the past period the following conditionalities are directed to prevail:

a. While the States may levy or renew demands of tax, if any, pertaining to Entries 49 and 50 of list II of such Seventh Schedule in terms of the law laid down in the decision in MADA (supra) the demand of tax shall not operate on transactions made prior to 1 April 2005;

b. The time for payment of the demand of tax shall be staggered in instalments over a period of twelve years commencing from 1 April 2026; and C. The Levy of interest and penalty on demands made for the period before 25 July 2024 shall stand waived for all the assesses."

6.

In view of the provisions of Section 107 of the GST Act, I deem it appropriate to dispose of the petition on the ground that there is alternative efficacious remedy available to the petitioner. Accordingly, I proceed to pass the following: ORDER i. Writ petitions are disposed of. HC-KAR NC: 2025:KHC-D:8097 ii. Liberty is reserved to the petitioner to approach the appropriate appellate authority, if so advised. iii. All contentions raised herein are permitted to be urged before appellate authority. iv. On such, petition filed by the petitioner, the appellate authority shall consider the same in accordance with law. v. The time spent herein shall be condoned by the appellate authority. Ordered accordingly. (PRADEEP SINGH YERUR) JUDGE

AC CT-CMU LIST NO.: 1 SL NO.: 98

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.