M/S. Bhavani Constructions vs. The Assistant Commissioner (St)

WP/8522/2025HC TelanganaGSTCNR HBHC01016869202521 March 2025Bench: SUJOY PAUL,RENUKA YARA7 pages

For Petitioner: SRI M'NAGA DEEPAKFor Respondent: SRI T.CHAITANYA KIRAN, AGP' REP' FOR, SRI SWAROOP OORILLA, SPL. GP FOR STATE TAX

AI SummaryRemanded

Facts

The petitioner, M/s. Bhavani Constructions, filed two writ petitions before the Telangana High Court challenging orders passed under Section 73 of the CGST Act. In WP No. 8405 of 2025, the challenge was to an order dated 23.08.2024 passed by the Assistant Commissioner (ST), Siddipet Circle, and proceedings dated 23.08.2024 under Section 65 of the CGST Act. In WP No. 8522 of 2025, the challenge was to an order dated 31.12.2023 passed by the Assistant Commissioner (ST) for the financial year 2017-18, and an appellate order dated 12.02.2025 by the Appellate Joint Commissioner (ST). The petitioner sought to declare these orders void, illegal, and violative of constitutional principles and natural justice. Interlocutory applications were also filed seeking a stay on further proceedings and collection of tax.

Held

The Court held that both the impugned final orders dated 23.08.2024 and 31.12.2023, as well as the appellate order dated 12.02.2025 in WP No. 8522 of 2025, were to be set aside. This decision was based on the consensus arrived at between the parties, acknowledging the petitioner's contention that the authorities had travelled beyond the scope of the show cause notices. The Court reasoned that this procedural lapse violated the principles of natural justice. Consequently, the Proper Officer was granted liberty to pass fresh orders in accordance with the law, with a mandatory opportunity for a personal hearing to be provided to the petitioner. The Court explicitly stated that it had not expressed any opinion on the merits of the cases. No costs were awarded.

Key Issues

1. Whether the impugned final orders dated 23.08.2024 (in WP No. 8405 of 2025) and 31.12.2023 (in WP No. 8522 of 2025) are void, illegal, and arbitrary for travelling beyond the scope of the show cause notices issued to the petitioner, thereby violating principles of natural justice and constitutional provisions (Articles 14, 19, 21, 265)? 2. Whether the appellate order dated 12.02.2025 (in WP No. 8522 of 2025) is void, illegal, and arbitrary for failing to address the issue of the Proper Officer travelling beyond the scope of the show cause notice? The petitioner argued that in passing the impugned final orders, the respondents had travelled beyond the scope of the show cause notices, rendering the orders liable to be set aside. The petitioner further contended that even the appellate authority in WP No. 8522 of 2025 failed to address this crucial aspect. The respondents, represented by the learned Special Government Pleader for State Tax, fairly conceded that the concerned authority had indeed travelled beyond the scope of the show cause notice while passing the impugned final orders.

Sections Cited

Section 73, Section 65

AI-generated summary — verify with the full judgment below

Cause title — parties, addresses and appearances

[ 3446 I HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD (SPecial Original Jurisdiction) FRIDAY, THE TWENW FIRST DAY OF MARCH TWO THOUSAND AND TWENW FIVE PRESENT THE HONOURABLE THE ACTING CHIEF JUSTICE SUJOY PAUL AND THE HONOURABLE SMT JUSTICE RENUKA YARA WRIT PETITION NOs: 8405 and 8522OF 2025 WRIT PETITION NO: 8405 OF 2025 Between: M/s. Bhavani Constructions, Represented by Mr. Madhusudan Reddy, S/.o' Malla nLaov. noeo 50 Years,'ocb- Businesi Ryo. +ot+g/1A, Prashanthnagar, Raghivendranagar, Siddipet, Telangana - 502103 AND 1 ...PETITIONER The Assistant Commissioner (ST)' Siddipet Circle, Nizamabad Division Telangana Commissioner of State Taxes, Commercial Tax Buildings, Nampally, Hyderabad ...RESPONDENTS 2 Petition under Article 226 of the constitution of lndia praying that in the circumstances stated in the affidavit filed therewith, the High court may be pleased to pass a writ order or direction, more particularly in the nature of a writ of mandamus declaring the order u/s. 73 of the GGST Act dated 23-OB-2O24 in Form GST DRC 07 bearing Reference No. 2D360824089565R along with proceedings dated 23-08-2024 uts. 65 of.the CGST Act passed by the Respondent No. 1 as being void, illegal, arbitrary, violative of Articles 14, 19,21 and 265 of the constitution of lndia, violative of principles of natural justice, and without authority of law and consequently set aside the same' lA NO: 1 OF 2O2:i Petition unde- Section 151 CPC praying that in the circunlstances stated in the affidavit fired in support of the petition, the High Corrrt mav be pleased to stay all further p.oceadings including collection of tax pur:;uant to Order u/s. 73 of the CGST Act dat€,d 23-08-2024 in Form GST DRC 07 t earing Reference No. 2D360824089565R along with proceedings dated 23-08-2024 u/s. 65 of the CGST Act. lA NO: 2 OF 2021i Petition ur der Section 151 CPC praying that in the circunstances stated in the affidavit fil-.d r support of the petition, the High Corrrt may be pleased to stay the operatiol o'the urgent arrear notice dated 01-03-2025 hearing Rc. No. GST/Arrears/202[-21tBhavani construction/O1 in so far as it pertains to the tax period 2019-20 Counsel for the Ftetitioner: SRI M.NAGA DEEPAK Counsel for the Flespondents: SRI T.CHAITANYA KIRAN, l\cp, REp. FOR SRI SWAROOP OORILLA, SPL. GP FOR STATE TAX WRIT PETITION NO: 8522 OF 2025 Between: M/s. Bhavani Ccnstructions, Represented by Mr. Mac husudan Reddy, S/o. Malla Reddy, Aged 5-0 years, Occ- Business -Rt/o. 4O14,,\t1A, prashanthnagar, Raghavend rana,gar, Siddipet, Telangana - 502.103 ..PETITIONER AND 1 The Assist ant Commissioner (ST), Siddipet Circle, Nizanrabad Division Telangana Appellate Joint C)ommissioner (ST), Secundrabad Division, Hyderabad Commissiorrer cf State Taxes, Commercial Tax BuildinEs, Nampally, Hyderabad ...RESPONDENTS Petition unrler Article 226 of the constitution of lndi;r pray,ng that in the circumstances stirtec in the affidavit filed therewith, the High oourt may be pleased to pass a writ order or direction, more particularly irr the nature of a writ 2 3 of mandamus declaring the order passed by the Respondent No. 1 u/s. 73 of the CGST Act dated 31112t2023 in Form GST DRC 07 bearing Reference No' 2D361223074898W along with its attachment for the Financial year 2017- 18 as confirmed in Appeal by the Respondent No. 2 vide Order dated 1210212025 bearing Order No. 2D360225029436G as being void, illegal, arbitrary, violative of Articles 14, 19,21 and 265 of the constitution of lndia, violative of principles of natural justice, and without authority of law and copsequently set aside the same. IA NO: 1 OF 2025 Petition under section 151 CPC praying that in the circumstances stated in the affidavit filed in support of the petition, the High court may be pleased to stay all further proceedings including collection of tax pursuant to order passed bythe Respondent No. 1 u/s.73 of the CGSTActdated 3111212023 in Form GST DRC 07 bearing Reference No,. 2D361223074898W along with its attachment for the Financial year 2017-18 as confirmed in Appeal by the Respondent No. 2 vide Order dated 12t02t2025 bearing Order No. 2D36O225029436G' lA NO: 2 OF 2025 Petition under Section 151 CPC praying that in the circumstances stated in the affidavit filed in support of the petition, the High court may be pleased to stay the operation of the urgent arrear notice dated 01/03/2025 hearing Rc.No. GST/Arrears/2 024-25lBhavani construction/o1 in so far as it pertains to the tax period 2017- 18. Counsel for the Petitioner: SRI M'NAGA DEEPAK Counsel for the Respondents: SRI T.CHAITANYA KIRAN, AGP' REP' FOR SRI SWAROOP OORILLA, SPL. GP FOR STATE TAX

The Court made the following: COMMON ORDER

I THE HON'BLE THE ACTING CHIEF JUSTICE SUJOY PAUL AND THE HON'BLE SMT. JUSTICE RENUI{J YAITA WRIT PETITON NoS.84OS & 8522 <tf 2025 COMMON ORDER (Per the Hon'bLe the Ading Ch)ef Ju;tice St joy Paul): lir i X{. Naga Deepak, learned counsel for tl-re petitioner and Sri f. Chaitanya Kiran, learned Assisrtant Government Pieader -epresents Sri Swaroop Oorilla, learned Special Governme nt F'leader for State Tax, for the respondents 2 IRt ga-,1 being had to the similitude of tl Le questions invoived. r izith the consent, matters were finallv hear(l .> 1't e s,ingular prayer raised in both the matters by learned c lunrtel for the petitioner is that rirhile passing the impugned firLal orders dated 23.O8.2024 ancl 3l .12.2023 respective y thre respondents have travelled bel,ond the scope of the sho-w cause notices. For this reason alonr:. both the impugned firrra.l orders must be jettisoned. lrurtht:r, the only difference in W.P.No.8522 of 2O2S is thtrt thr: petitioner approache C this Court against the appellate order dated 12 .O2.2O2 i zLsi well. It is canvassed that e.zen the appellate \ authority. tas not dealt with the aforesaid as pect ,,.vhether thL

2 Proper Ofhcer has travelled beyond the scope of show cause notice. 4. l,earned Special Government Pleader for State Tax' for the respondents, fairly submitted that while passing the impugned final orders, the concerned authority' indeed' travelled beyond the scope of show cause notice'

Therefore, it is agreed by both learned counsel for the parties that both the impugned final orders dated 23'O8'2024 and 31.1,2.2023 respectiveiy as well as the appellate order dated |2.o2.2o25inW'P.No'8522of2025maybesetasideby reserving liberty to the Proper Officer to pass fresh orders in accordance with law by giving opportunity of personal hearing to the petitioner.

In view of consensus arrived at' both the impugned final orders dated 23'08. 2024 and' 31'12 '2023 respectively as well as the appellate order dated l2'O2'2025 in W'P'No'8522 of 2025 are set aside. The Proper Officer is at liberty to pass fresh orders in accordance with law by giving opportunity of personal hearing to the petitioner.

3 l 7. \cc:ordingly, these Writ petitions are disposed of. It is made :l :ar that this Court has not expres sed a ny opinion on merits o ' tbr: cases. No costs. Interlocutory applications, if any pending, shalt also stald r'losed //// P. CH. NAGABHUSHAMBA _?Tr*REGTSTRAR UECTION OFFICER To, 1 The Assis lant Commissioner (ST), Siddipet Circle, Nizarnabad Division Telangana The Comnrissioner of State Taxes, Commercial Ta>. Build ngs, Nampally, Hyderabad The Appell rte Joint Commissioner (ST), Secundrabad I)ivisior, Hyderabad One CC to SRI M.NAGA DEEPAK, Advocate [OPUC] Two CCs to SIPL. cP FOR STATE TAX, High Ccurt,fcr the State of Telangana at Hyderabad [OUTI Two CD Cc pies 2 o BSR LS J 4 5

HIGH COURT DATED: 2110312025 { l1r- s A/i A, (( at COMMON ORDER fo O lr 6 nPt 2025 ,;i C WP.Nos.8405 and 8522 of Z02S )t'sp.a'' ctt9A t t := DISPOSING: OF BOTH THE WRIT PETII'IONS, WITHOUT COSTS ?z 2 I g./",/.{5 .-

Reproduced from the public record of the Telangana High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.