Shri.B.T.Siddappa (Shri.Budanoor Thammaiah Siddappa) vs. The Assistant Commissioner Of Commercial Taxes

Held

The Court allowed WP No. 28817/2026, quashing the intimation (Form GST DRC-01A), show cause notice (Form GST DRC-01), and adjudication order (Form GST DRC-07) issued under Section 74. The reasoning was that initiating proceedings under Section 74 for the same financial year and subject matter, when proceedings under Section 73 had already been concluded by the same officer, was impermissible and without jurisdiction. The Court held that there cannot be two parallel proceedings, especially when the later proceedings are under Section 74. WP No. 29033/2024 was disposed of in light of the Division Bench's order in Writ Appeal No.652/2026, which held that no directions can be issued to tax authorities to act contrary to statutory terms and that blanket directions regarding differential tax burden cannot be issued without reference to contract terms. The petitioner was granted liberty to pursue remedies against the second respondent (Executive Engineer) subject to just exceptions, but no directions were issued to the tax authorities regarding reimbursement or revised returns. The issue of whether the petitioner is entitled to directions for the Executive Engineer to enter into a supplementary agreement and pay differential GST was effectively decided against the petitioner in WP No. 29033/2024, based on the Division Bench's ruling.

Facts

The petitioner, Shri B.T. Siddappa, a proprietor and PWD contractor, filed two writ petitions challenging proceedings initiated by the Assistant Commissioner of Commercial Taxes under the CGST/KGST Act for the financial year 2018-19. WP No. 29033/2024 challenged proceedings under Section 73, including a show cause notice dated 18.11.2023, an adjudication order dated 29.04.2024, and a recovery notice dated 05.10.2024. WP No. 28817/2026 challenged subsequent proceedings under Section 74, including an intimation dated 11.06.2025, a show cause notice dated 25.06.2025, and an adjudication order dated 30.12.2025, arguing that these were initiated for the same tax period and subject matter already adjudicated under Section 73. The petitioner also sought directions to the Executive Engineer to enter into a supplementary agreement and pay differential GST, relying on a previous High Court decision.

Key Issues

1. Whether the initiation and continuation of proceedings under Section 74 of the CGST/KGST Act for the financial year 2018-19, after adjudication under Section 73 for the same period and subject matter by the same officer, is without jurisdiction and void? 2. Whether the petitioner is entitled to directions for the Executive Engineer to enter into a supplementary agreement and pay differential GST, as per the decision in Sri Chandrashekharaiah's case? Petitioner's contentions: - Proceedings under Section 74 are illegal and void as they are parallel to and for the same tax period and subject matter as those already adjudicated under Section 73 by the same authority. - Relied on the decision in Sri Chandrashekharaiah and others v. State of Karnataka and others for directions regarding differential tax liability and reimbursement. Revenue's contentions: - The judgment notes that the Division Bench in Writ Appeal No.652/2026 observed that no directions can be issued to tax authorities to act contrary to statutory terms and that blanket directions cannot be issued without reference to contract terms. The judgment does not record specific arguments from the revenue regarding the illegality of parallel proceedings under Section 73 and 74.