Judgment
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CNR: KAHC010188262026 NC: 2026:KHC:48763 WP No. 8586 of 2026
IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 8TH DAY OF SEPTEMBER, 2026 BEFORE THE HON'BLE MR. JUSTICE B M SHYAM PRASAD WRIT PETITION NO. 8586 OF 2026 (T-RES) BETWEEN:
MUKTHISHWARA CONSTRUCTIONS NO 62, BEHIND WIDIA FACTORY, NAGASANDRA POST, ASHOK NAGAR, BENGALURU URBAN, BENGALURU - 560 073.
(REPRESENTED BY PROPRIETOR RAMA D. REDDY) …PETITIONER (BY MS. NEHA ALUR., ADVOCATE FOR SRI. ATUL KRISHNA RAO ALUR., ADVOCATE)
AND:
1.
STATE OF KARNATAKA REPRESENTED BY ITS SECRETARY, DEPARTMENT OF FINANCE GOVERNMENT OF KARNATAKA, AMBEDKAR VEEDHI, BENGALURU 560 001.
2.
THE DEPUTY COMMISSIONER OF COMMERCIAL TAXES (AUDIT)-6.4 DGSTO- 6, 3RD FLOOR KIADB BUILDING, 14TH CROSS PEENYA INDUSTRIAL AREA BENGALURU - 560 058.
Digitally signed by VANAMALA N Location:
HIGH COURT OF KARNATAKA
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CNR: KAHC010188262026 NC: 2026:KHC:48763 WP No. 8586 of 2026
3.
ASSISTANT COMMISSIONER OF COMMERCIAL TAXES (AUDIT-6.11), DGSTO-3, 2ND FLOOR, KIADB BUILDING, 14TH CROSS, 2ND STAGE, PEENYA INDUSTRIAL AREA, BENGALURU- 560 058.
…RESPONDENTS (BY SMT.MALAVIKA PRASAD., HCGP )
THIS WP IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASHING THE ADJUDICATION ORDER BEARING DGSTO-06/ACCT(A)-6.11 /ADJ-73/ 10/2024-25 DATED 24/4/24, PASSED U/S 73(9) OF THE CGST /KGST ACT, AT ANNEXURE- B, ISSUED BY RESPONDENT-3 FOR THE PERIOD 2018- 19 IN SO FOR IS THE PETITIONER IS CONCERNED;
(B) QUASHING THE DEMAND ISSUE BY RESP-3 FOR THE PERIOD 2018-19, IN FORM GST DRC 07 DATED 24/04/2024, BEARING REFERENCE NO ZD290424061316D, AT ANENXURE- C, IN SO FOR IS THE PETITIONER IS CONCERNED; (C) QUASHING THE ADJUDICATION ORDER BEARING DGSTO- 06/ACCT(A)-6.11/ADJ- 73/26/2024-25 DATED 06/08/24, PASSED U/S 73(9) OF THE CGST / KGST ACT, AT ANENXURE-D, ISSUED BY RESPONDENT-2 FOR THE PERIOD 2019- 20 IN SO FOR IS THE PETITIONER IS CONCERNED;(D) QUASHING THE DEMAND ISSUE BY RESP-2 FOR THE PERIOD 2019- 20, IN FORM GST DRC 07 DATED 06/08/2024, BEARING REFERENCE NO ZD2908240265544, AT ANENXURE- E, IN SO FOR IS THE PETITIONER IS CONCERNED; (E) QUASHING THE ADJUDICATION ORDER BEARING DCCT(A)6.4/DGSTO-06/73/2024- 25 DATED 24/02/25,PASSED U/S 73(9) OF THE CGST / KGST ACT AT ANENXURE-F, ISSUED BY RESPONDENT-2 FOR THE PERIOD 2020-21 IN SO FOR IS THE PETITIONER IS CONCERNED; (F)
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CNR: KAHC010188262026 NC: 2026:KHC:48763 WP No. 8586 of 2026
QUASHING THE DEMAND ISSUE BY RESP-2 FOR THE PERIOD 2020-21, IN FORM GST DRC 07 DATED 24/02/2025, BEARING REFERENCE NO ZD290225097824W, AT ANENXURE- G, IN SO FOR IS THE PETITIONER IS CONCERNED;
(G) DIRECTING THE RESP-2 AND RESP 3 TO ALLOW THE ITC CLAIMED BY THE PETITIONER FOR THE PERIODS 2018-19, 2019-20 AND 2020-21, IN SO FOR AS THE PETITIONER IS CONCERNED; (H) DIRECTING THE RESP-2 TO VERIFY THE BOOKS OF ACCOUNTS, FOR THE PERIODS, 2018-19, 2019- 20 AND 2020-21, IN SO FOR AS THE PETITIONER IS CONCERNED.
THIS PETITION, COMING ON FOR ORDERS, THIS DAY, ORDER WAS MADE THEREIN AS UNDER:
CORAM: HON'BLE MR. JUSTICE B M SHYAM PRASAD
ORAL ORDER
The short question for consideration is whether this Court must interfere with the impugned Show Cause Notices and the Adjudication Orders or just the Adjudication Orders under the Central Goods and Services Tax Act, 2017/Karnataka Goods and Services Tax Act, 2017 with opportunity to the petitioner to file Response to the corresponding Show Cause Notices. The impugned Adjudication Orders are for the financial years 2018-19 to 2020-21. The
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CNR: KAHC010188262026 NC: 2026:KHC:48763 WP No. 8586 of 2026
details of the impugned Adjudication Orders and the consequential Demands are as follows.
Notices/ Orders Period Date Provisi ons of KGST Act, 2017 Annex ures Adjudication Order 2018-19 24.04.2024 73[9] B Demand 2018-19 24.04.2024 73 C Adjudication Order 2019-20 06.08.2024 73[9] D Demand 2019-20 06.08.2024 73 E Adjudication Order 2020-21 24.02.2025 73[9] F Demand 2020-21 24.02.2025 73 G
It is not in dispute that these proceedings are commenced because of the difference/mismatch between Forms GSTR-7 and GSTR-3B, disallowance of Input Tax Credit [ITC] and the liability to pay penalty for not producing the Books of Accounts. The Adjudication Orders are in the premise that though the petitioner has been extended opportunities with service of Intimation and the Show Cause Notices as well as personal hearing, but the petitioner has neither filed a Response nor availed the opportunity.
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CNR: KAHC010188262026 NC: 2026:KHC:48763 WP No. 8586 of 2026
The petitioner contends that its proprietor is 65-year-old, that he was bogged down by health conditions during the relevant time and that the petitioner has stated about his different ailments and his hospitalization in paragraph-7 of the memorandum of writ petition. The petitioner also contends that he can produce documents to justify the declaration in Forms GSTR-7 as also the transactions relied upon to claim ITC. Ms. Malavika Prasad, a learned High Court Government Pleader, is heard in the circumstances.
The petitioner's case hinges on its inability to avail the opportunity that is extended and the petitioner justifies the same by relying upon health conditions and hospitalization of its proprietor. These circumstances persuade this Court to intervene to restore the proceedings for consideration on terms.
Hence, the following.
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CNR: KAHC010188262026 NC: 2026:KHC:48763 WP No. 8586 of 2026
ORDER [A] The petition is allowed.
[B] The following Adjudication Orders/Demand are quashed restoring the proceedings to the stage of the Show Cause Notices.
Notices/ Orders Date/ Period Provisions of KGST Act, 2017 Annex ures Adjudication Order 24.04.2024 2018-19 73[9] B Demand 24.04.2024 2018-19 73 C Adjudication Order 06.08.2024 2019-20 73[9] D Demand 06.08.2024 2019-20 73 E Adjudication Order 24.02.2025 2020-21 73[9] F Demand 24.02.2025 2020-21 73 G
[C] The petitioner shall by 15.10.2026 file Response with supporting documents in response to the Show Cause Notices dated 30.01.2024, 27.05.2024 and 29.07.2026 relevant
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CNR: KAHC010188262026 NC: 2026:KHC:48763 WP No. 8586 of 2026
to the financial years 2018-19, 2019-20, and 2020-21.
[D] The petitioner shall deposit 10% of the Demand proposed under each Show Cause Notice by 15.10.2026 subject to the outcome in the restored proceedings and the authority/ies are directed to consider the same and pass just Orders.
Sd/- (B M SHYAM PRASAD) JUDGE
AN/-