M/S Il And Fs Solar Power Limited vs. State Of Karnataka
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The petitioner, M/s IL and FS Solar Power Limited, filed a writ petition challenging two orders passed by Respondent No. 3, the Deputy Commissioner of Commercial Taxes (Audit)-1. The first impugned order, dated 22.12.2023, was passed pursuant to an Audit Report dated 12.09.2023 and a Show Cause Notice dated 25.09.2023. The petitioner did not submit a reply to this notice, leading to an ex-parte order. Subsequently, the petitioner filed a rectification application with an additional written statement on 14.02.2024, which was rejected by Respondent No. 3 via an order dated 20.03.2024. Aggrieved by both orders, the petitioner approached the High Court.
Held
The Court allowed the petition. It held that the impugned order dated 22.12.2023 was an ex-parte order passed without the petitioner contesting the Show Cause Notice. Consequently, the Court deemed it just and appropriate to set aside both impugned orders dated 22.12.2023 and 20.03.2024. The matter was remitted back to Respondent No. 3 to the stage of the petitioner submitting a reply to the Show Cause Notice dated 25.09.2023. The petitioner undertook to appear on 19.09.2024, and liberty was granted to submit a reply with documents, which Respondent No. 3 must consider after providing a reasonable opportunity to be heard. The ratio decidendi is that an ex-parte order passed without affording the assessee an opportunity to present their case, especially when a rectification application was filed, warrants setting aside and remand for fresh consideration.
Key Issues
1. Whether the impugned order dated 22.12.2023, passed ex-parte without the petitioner filing a reply to the Show Cause Notice, is illegal, arbitrary, and without jurisdiction or authority of law? The petitioner contended that both impugned orders are illegal, arbitrary, and without jurisdiction. The revenue or State did not record any specific arguments in the judgment.
Sections Cited
Section 73
AI-generated summary — verify with the full judgment below
Cause title — parties, addresses and appearances
ORAL ORDER
In this petition, the petitioner seeks the following reliefs:
"a) Issue a writ of certiorari quashing the order No.DGSTO/DVG/DCCT-Audit-1/GST-S-73/2023-24 dated 22.12.2023 passed by Respondent No.3 vide Annexure-A to the Writ Petition;
b) Issue a writ of certiorari quashing the Office proceedings Reference No.Dcct(Audit-1) Dvg/2023- 24 dated 20.03.2024 passed by Respondent No.3 vide Annexure-B to the Writ Petition."
Heard learned counsels for the parties and perused the material on record. NC: 2024:KHC:34477
A perusal of the material on record will indicate that pursuant to the Audit Report dated 12.09.2023, the respondent No.3 issued a Show Cause Notice dated 25.09.2023 to which the petitioner did not submit any reply and consequently, the same culminated in the impugned order dated 22.12.2023. Subsequently, the petitioner filed a rectification application along with the additional written statement on 14.02.2024 and the same was rejected by the respondent No.3 vide impugned order dated 20.03.2024. Aggrieved by the impugned orders dated 22.12.2023 and 20.03.2024, the petitioner is before this Court by way of the present petition.
A perusal of the material on record will indicate that several contentions have been urged by the petitioner for the purpose of contending that the impugned order dated 22.12.2023 as well as the impugned order dated 20.03.2024 are illegal, arbitrary and without juri iction or authority of law. Under these circumstances, without expressing any opinion on the merits/demerits of the rival contentions and in the light of the undisputed fact that the impugned order dated 22.12.2023 was an ex-parte order which was passed without the petitioner contesting NC: 2024:KHC:34477 the Show Cause Notice, I deem it just and appropriate to set aside the impugned orders and remit the matter back to the respondent No.3 for reconsideration afresh in accordance with law.
In the result, the following: ORDER
A. The petition is hereby allowed.
B. The impugned orders at Annexures - A [dated 22.12.2023] and B [dated 20.03.2024] passed by the respondent No.3 are set aside.
C. The matter is remitted back to the respondent No.3 to the stage of the petitioner submitting reply to the Show Cause Notice dated 25.09.2023 and to proceed further in accordance with law.
D. The petitioner undertakes to appear before the respondent No.3 on 19.09.2024 without awaiting further notice from the respondent No.
E. Liberty is reserved in favour of the petitioner to submit its reply/response along with the documents to the NC: 2024:KHC:34477 Show Cause Notice which shall be considered by the respondent No.3, who shall also provide sufficient and reasonable opportunity to the petitioner and hear it and proceed further in accordance with law. (S.R.KRISHNA KUMAR) JUDGE
RB
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.