M/S Indian Scrap vs. Deputy Commissioner Of
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Cause title — parties, addresses and appearances
ORAL ORDER
In this petition, petitioner seeks the following reliefs: "The Petitioner, therefore, most humbly prays that this Hon'ble Court may kindly be pleased to issue a writ, order or direction: (i) Quashing the impugned Order of Adjudication dated 16.05.2023 bearing Case ID No. 264166/04-01-2023 and KGAIN No. 1570562812/31-03-2022 passed by Respondent No. 1 under Section 73(1) read NC: 2025:KHC:17021 with Section 73(9) and Section 122(2)(a) of the Central Goods and Services Tax Act, 2017/Karnataka Goods and Services Tax Act, 2017 and Rule 142 of the Goods and Services Tax Rules, 2017 for the tax periods of April 2018 to March 2019 (Annexure 'A'); (ii) Quashing the impugned Summary of Order on Form GST DRC 07 dated 17.05.2023 bearing Reference No: ZD290523011150Z issued by the 1st Respondent under the relevant provisions of the Central Goods and Services Tax Act, 2017/Karnataka Goods and Services Tax Act, 2017 for the tax periods of April 2018 to March 2019 (Annexure 'A-1'); (iii) Quashing the impugned Endorsement dated 22.11.2023 bearing No. DCCT(AUDIT)/SMG/T:611/2023-24 issued by the 1st Respondent for the tax periods of April 2018 to March 2019 (Annexure 'B'); (iv) Quashing the impugned Appeal Order passed by the 2nd Respondent in Appeal No. GST/AP-63/2023-24 dated 18.01.2024 under Section 107 of the Karnataka Goods and Services Tax Act, 2017 for the tax periods of April 2018 to March 2019 (Annexure 'C'); (v) Quashing the Notice dated 19.09.2023 in Form GST DRC 13 bearing No. DCCTAUDIT/SMG/T.No.511(a)/2023-24 for the tax period of April 2018 to March 2019, issued by Respondent No.1 (Annexure 'K')' (vi) Direct Respondent Nos.3 and 4 to provide copies of the documents submitted by the Petitioner on 22.07.2019 and 01.11.2019 as evidenced by Order-in-Original dated 06.01.2025 bearing File GEXOM/ADJN/GST/DCAC/5/2021-TECH-CGST- SVMG-COMMRTE-MYUSURU and DIN No. NC: 2025:KHC:17021 20250157YY00000010560 passed by Respondent No. 4 (Annexure 'Q') and (vii) Pass such other or further orders as this Hon'ble Court may deem fit in the facts and circumstances of the case, in the Interests of justice and equity."
A perusal of the material on record will indicate that the 1st respondent having issued show cause notice dated 20.02.2023 to the petitioner, since no reply was submitted by the petitioner to the same and also did not contest the proceedings, the 1st respondent proceeded to pass the impugned exparte adjudication order dated 16.05.2023 and issued a summary dated 17.05.2023, followed by recovery notices etc., the petitioner is before this Court by way of the present petition.
It is submitted that out of abundant caution, the petitioner not only applied for rectification which is rejected vide order dated 22.11.2023 and also filed an appeal against the rectification rejection order which is also rejected vide order dated 18.01.2024 and as such the petitioner is before this Court by way of the present petition. NC: 2025:KHC:17021
It is submitted that the inability and omission on the part of the petitioner to submit a reply to the aforesaid show cause notice and contest the proceedings was due to bona fide reasons, unavoidable circumstances and sufficient cause, the impugned adjudication order as well the rectification rejection order and the appellate authority order confirming the rectification rejection order may be set aside and the matter remitted back to the 1st respondent for reconsideration afresh in accordance with law.
Per contra, the learned Additional Government Advocate submits that there is no merit in the petition and the same is liable to be dismissed.
A perusal of the impugned adjudication order will clearly indicate that the same is a exparte order which proceeded on the basis, as the petitioner did not submit a reply to the show cause notice nor contest the proceedings. However, in the light of the specific assertion on the part of the petitioner that it is inability and omission to submit a reply and contest the adjudication proceedings was due to bona fide reasons, unavoidable circumstances and sufficient cause, I NC: 2025:KHC:17021 deem it just and appropriate to set aside the impugned assessment adjudication order dated 16.05.2023 and the summary dated 17.05.2023 and remit the matter back to the 1st respondent for reconsideration afresh in accordance with law.
Though the petitioner filed rectification application which was rejected vide order dated 22.11.2023 and the appeal filed against the same was rejected vide order dated 18.01.2024, in the light of setting aside of the adjudication order, the aforesaid two orders also deserves to be set aside.
In the result, I pass the following ORDER
(i) The writ petition is hereby allowed. (ii) The impugned orders at Annexure-A dated 16.05.2023, Annexure-A1 dated 17.05.2023, Annexure-B dated 22.11.2023 and Annexure-C dated 18.01.2024 are hereby set aside. NC: 2025:KHC:17021 (iii) The matter is remitted back to the 1st respondent for reconsideration afresh in accordance with law. (iv) The petitioner is directed to appear before the 1st respondent on 19.05.2025. (v) Upon the petitioner submitting a reply along with relevant documents to the show cause notice, on 19.05.2025, the respondent shall afford a reasonable opportunity to the petitioner and hear him and proceed further in accordance with law. (vi) It is made clear that, if the petitioner does not appear on 19.05.2025 and does not file objections along with the document on that day, the present order shall stand automatically recalled/cancelled and the present petition shall stand revived/restored without further orders and without reference to the Bench. NC: 2025:KHC:17021 (vii) Liberty is reserved in favour of the petitioner to file its reply, pleadings, documents, etc., before the respondent, who shall consider the same and pass appropriate orders in accordance with law. (viii) All rival contentions are kept open and no opinion is expressed on the same. (S.R.KRISHNA KUMAR) JUDGE AP List No.: 2 Sl No.: 5
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.