BharatTaxGST

Ve Commercial Vehicles LTD vs. The State Of Karnataka

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WP/18565/2024HC KarnatakaGSTCNR KAHC01038570202404 September 2024Bench: S.R.KRISHNA KUMAR5 pages
For Petitioner: SRI. RAVI RAGHAVAN, SRI. M.I. IBRAHIM AND SRI. TUSHAR SHARMA, ADVOCATESFor Respondent: SRI. SHAMANTH NAIK, HCGP FOR R1 AND R2

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Cause title — parties, addresses and appearances
- 1 - NC: 2024:KHC:36331 WP No. 18565 of 2024 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 4TH DAY OF SEPTEMBER, 2024 BEFORE THE HON'BLE MR JUSTICE S.R.KRISHNA KUMAR WRIT PETITION NO. 18565 OF 2024 (T-RES) BETWEEN: VE COMMERCIAL VEHICLES LTD., YALACHAHALLY VILLAGE, TAVAREKERE POST, HOSKOTE TALUK, DHARWAD 562 122, REP. BY SHRINITIN NAGDA, VICE PRESIDENT INCORPORATED UNDER THE SECTION 13(1) OF THE COMPANIES ACT 2013 …PETITIONER (BY SRI. RAVI RAGHAVAN, SRI. M.I. IBRAHIM AND SRI. TUSHAR SHARMA, ADVOCATES) AND: 1. THE STATE OF KARNATAKA BY ITS CHIEF SECRETARY, VIDHANA SOUDHA, BENGALURU 560 001 2. ASSISTANT COMMISSIONER OF COMMERCIAL TAXES, LOCAL GST OFFICE 038, NO.58, 2ND FLOOR, HAL 2ND STAGE, DEFENSE COLONY, 100-FEET ROAD, INDIRANAGAR, BENGALURU 560 038 …RESPONDENTS (BY SRI. SHAMANTH NAIK, HCGP FOR R1 AND R2) Digitally signed by LEELAVATHI S R Location: HIGH COURT OF KARNATAKA - 2 - NC: 2024:KHC:36331 WP No. 18565 of 2024 THIS WRIT PETITION IS FILED UNDER ARTICLE 226 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE IMPUGNED ORDER NO.ACCT/LGSTO-038/DRC.07/24-25 DATED 29/04/2024 ISSUED BY R2 ENCLOSED AS ANNEXURE-A CONFIRMING THE DEMAND OF DIFFERENTIAL IGST AND GST COMPENSATION CESS AMOUNTING TO RS. 22,36,81,737/- ALONG WITH INTEREST AND PENALTY ON SUPPLY OF GOODS TO MERCHANT EXPORTER AND ETC. THIS PETITION, COMING ON FOR ORDERS, THIS DAY, ORDER WAS MADE THEREIN AS UNDER: CORAM: HON'BLE MR JUSTICE S.R.KRISHNA KUMAR

ORAL ORDER 1. In this petition petitioner seeks following reliefs : "a) issue a writ in the nature of Certiorari or any other appropriate writ or order or direction under Article 226 of the Constitution of India quashing the impugned Order No. ACCT/LGSTO- 038/DRC.07/24- 25 dated 29.04.2024 issued by Respondent No. 2 enclosed as Annexure-A confirming the demand of differential IGST and GST Compensation Cess amounting to Rs.22,36,81,737/- along with interest and penalty on supply of goods to merchant exporter

b) hold that the Petitioner has fulfilled the conditions of Notification No.41/2017-Integrated Tax (Rate) on supplies made to merchant exporter and as-such entitled to benefit of concessional rate of tax;

c) pass such further order(s) and other reliefs as the nature and circumstances of the case may require."

2.

A perusal of the material on record would indicate that on 10.10.2023, respondent no.2 issued intimation of discrepancies in Form ASMT-10 to the petitioner who issued a reply on NC: 2024:KHC:36331

18.11.

2023 subsequent to which respondent no.2 issued an intimation in Form DRC-01A dated 14.12.2023 to which the petitioner submitted a reply on 21.12.2023. Thereafter, respondent no.2 issued a show cause notice in Form DRC-01 dated 30.1.2024 to which the petitioner submitted a detailed reply on 29.2.2024. It is the grievance of the petitioner that though he requested an opportunity of personal hearing in his reply dated 29.2.2024, respondent no.2 proceeded to pass the impugned order dated 29.4.2024 without providing sufficient opportunity and reasonable opportunity to the petitioner nor providing an opportunity of personal hearing and as such, the impugned order being violative of the provisions of Section 75(4) of the CGSC Act, 2017 which mandates personal hearing as well as due to violation of principles of natural justice, the petitioner is before this Court by way of the present petition. It is also submitted that the impugned show cause notice demands compensation cess from the petitioner which is confirmed in the impugned order which is impermissible in law in the light of the notification dated 28.6.2017 and impugned show cause notice and impugned order deserves to be quashed on this ground also. NC: 2024:KHC:36331

3.

Per contra, learned HCGP submits that there is no merit in the petition and the same is liable to be dismissed.

4.

As rightly contended by the learned counsel for the petitioner, a perusal of the reply dated 29.2.2024 vide Annexure-L will indicate that the petitioner has specifically sought for an opportunity of personal hearing before the matter was adjudicated. Despite the specific request made by the petitioner for an opportunity of personal hearing, the respondent has proceeded to pass the impugned order which is not only in violation of principles of natural justice but also contrary to Section 75(4) of the CGSC Act warranting interference in the present petition.

5.

In the result, I pass the following: ORDER i) The petition is hereby allowed;

ii) The impugned order at Annexure-A is hereby set aside;

iii) Matter is remitted back to the respondent for reconsideration afresh in accordance with law. NC: 2024:KHC:36331 iv) Respondents shall provide sufficient and reasonable opportunity to the petitioner and also provide him personal hearing and proceed further in accordance with law;

v) The petitioner undertakes to appear before respondent no.2 on 23.9.2024 without waiting for further notice from respondent no.2;

vi) Liberty is reserved in favour of the petitioner to submit additional pleadings, documents etc. which shall be considered by respondent no.2 who shall provide sufficient and reasonable opportunity to the petitioner as well as granting personal hearing and thereafter proceed in the matter in accordance with law.

vii) All rival contentions in all other respects of the matter are kept open and no opinion is expressed on the same. (S.R.KRISHNA KUMAR) JUDGE

rs List No.: 1 Sl No.: 13

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.