M/S Ramdev Medical vs. Assistant Commissioner Of
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Before: SMT. INDIRA DEVI,
In this petition, the petitioner seeks following reliefs: "A. Issue a writ of certiorari or any other appropriate writ, order, or direction, quashing the order of the 2nd Respondent vide Form GST APL-02 bearing Reference No. ZD291124078389W dated 19.11.2024 for tax period 2017- 18 in Annexure "B", to the extent of disallowance of Input Tax Credit amounting to Rs. 19,07,237/-, along with applicable interest and penalty, as illegal, arbitrary, void ab initio, and ultra vires the provisions of the CGST/KGST Act, 2017, along with all consequential actions arising therefrom. B. Issue a writ of certiorari or any other appropriate writ, order, or direction, quashing the adjudication order passed by the 1st Respondent in Form GST DRC-07 bearing Reference No. ACCT/LGSTO-55/T.No.14634/2023-24 dated 08.11.2023 for the tax period July 2017 to March 2018, in Annexure "A", to the extent of disallowance of Input Tax Credit amounting to Rs.19,07,237/-, along with applicable interest and penalty, as illegal, arbitrary, and void ab initio, being contrary to the provisions of the CGST/KGST Act, 2017, and violative of the principles of natural justice, along with all consequential actions arising therefrom. C. Issue an order, writ or direction in the nature of declaration, declaring the provisions of Section 16(2)(c) of the Central Goods and Services Tax Act, 2017 and Section 16(2)(c) of the Karnataka Goods and Services Tax Act, 2017 NC: 2025:KHC:9540 for being illegal, unreasonable, arbitrary and discriminatory and violative of Articles 14, 19 and 300A, along with the attendant actions; D. Grant such other relief that this Hon'ble Court may think fit including the cost of this petition in the interest of justice and equity.
Heard learned counsel for the petitioner and learned HCGP for the respondents and perused the material on record.
A perusal of material on record will indicate that pursuant to notice dated 24.08.2022 under Section 61 of the CGST Act/KGST Act 2017, the first respondent issued a pre- intimation notice dated 12.12.2022 under Rule 142(1A) of the CGST/KGST Rules, 2017, to the petitioner, who did not issue any reply/response to the same. Subsequently, the first respondent issued a show-cause notice dated 19.04.2023 under Section 73(1) of the CGST/KGST Act, 2017 alleging that the petitioner had availed excess Input Tax Credit in a sum of Rs.19,07,237/-. Since the petitioner did not submit his reply to the said show-cause notice also, the first respondent proceeded to pass the impugned order dated 08.11.2023 under Section 73(9) of the CGST/KGST Act, 2017 confirming the total demand of Rs.41,17,586/- including the NC: 2025:KHC:9540 tax, interest and penalty. In pursuance of the same, the first respondent issued notice dated 06.08.2024 under Section 79 of the CGST/KGST Act, 2017 directing attachment of the petitioner's bank accounts for recovery of the alleged tax dues.
Learned counsel for the petitioner submits that neither the pre-intimation notice under Rule 142(1A) nor the show-cause notice under Section 73(1) of the CGST/KGST Act, 2017 were communicated or served upon the petitioner and he was not aware of the said proceedings. So also, physical copies of the aforesaid notices were not communicated to the petitioner and consequently, he was not in a position to submit a reply to the same or contest the proceedings, which culminated in the impugned ex-parte order. It is submitted that the petitioner was not aware of the impugned proceedings till he received the notice dated 06.08.2024 under Section 79 of the CGST/KGST Act, 2017 directing the attachment of his bank accounts, pursuant to which, the petitioner filed an appeal on 21.10.2024 which was dismissed as barred by limitation vide impugned order dated 19.11.2024. It is submitted that since the GST Appellate Tribunal has not been constituted as on today, the petitioner has no option but to approach this Court by way of NC: 2025:KHC:9540 the present petition interalia contending that the inability and omission on the part of the petitioner to submit a reply to the pre-intimation notice and 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.
Per contra, learned HCGP for the respondents submits that since the pre-intimation notice and show-cause notice were duly communicated electronically to the petitioner by uploading the same on GST portal as well as e-mail, the petitioner cannot complain that he was not aware of impugned proceedings and as such, there is no merit in the petition and the same is liable to be dismissed.
Though several contentions have been urged by both sides as regards to the petitioner not having received the pre- intimation notice and show-cause notice and his inability and omission to contest the proceedings, is a matter of record and an undisputed fact that the petitioner did not submit his reply to the NC: 2025:KHC:9540 show-cause notice or pre-intimation notice nor contested the proceedings, which culminated in the impugned ex-parte order. So also the appeal filed by the petitioner before the second respondent has been dismissed as barred by limitation.
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 order dated 08.11.2023 and remitting the matter back to the first respondent for reconsideration of the matter afresh in accordance with law to the stage of petitioner submitting reply to the impugned show-cause notice by imposing cost of Rs.10,000/- on the petitioner payable to the High Court Advocate Welfare Fund.
In the result, I pass the following: ORDER
(i) The petition is hereby allowed.
(ii) The impugned order dated 08.11.2023 passed by the first respondent under Section 73(9) of the NC: 2025:KHC:9540 CGST/LGST 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 subject to the petitioner depositing Rs.10,000/- to the High Court Advocate Welfare Fund.
(iv) The petitioner is directed to appear before the first respondent on 27.03.2025 at 2.30 p.m. 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 reasonable opportunity to the petitioner and hear them and proceed further in accordance with law. (S.R.KRISHNA KUMAR) JUDGE DS CT: TSM List No.: 1 Sl No.: 15
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.