Case Law Details
Tech Desire Infra Private Limited Vs Commissioner of Commercial Taxes (Karnataka High Court)
Ex Parte GST Cancellation Orders Remanded Due to Duplicate Tax Demands; Karnataka HC Orders Fresh Hearing After Finding Alleged Duplication in GST Adjudication Orders; GST Orders Passed Without Hearing Taxpayer Set Aside by Karnataka High Court; Karnataka HC Grants Fresh Opportunity in GST ITC Mismatch Case Due to Ex Parte Orders.
The petitioner challenged adjudication orders passed under Section 73 of the CGST/KGST Act. The petitioner contended that two separate orders at Annexures-A and C series were passed for the same tax period on the same issue relating to mismatch of Input Tax Credit (ITC). It was further submitted that the order at Annexure-B1 concerned discrepancies between GSTR-1 and GSTR-3B returns.
The petitioner argued that all the impugned orders were passed ex parte and sought an opportunity to file replies to the show cause notices. It was submitted that the failure to respond earlier was bona fide because the GST registration had already been cancelled in 2023.
The State contended that notices had been duly served, as reflected in the impugned orders, and therefore the petitioner was responsible for non-participation in the proceedings.
The Karnataka High Court observed that the petitioner had specifically alleged duplication of orders for the same tax period under Annexures-A and C series. The Court also noted that all the impugned orders had admittedly been passed ex parte. Considering the petitioner’s assertions and the factual issues involved, the Court held that the matter required reconsideration after granting the petitioner an opportunity to place material before the authority.
Accordingly, the Court set aside the orders at Annexures-A, B, and C series and remitted the matter to the second respondent for fresh adjudication from the stage of reply to the show cause notice. The petitioner was directed to deposit 10% of the tax demand relating to Annexures-A and B series. All contentions on merits were kept open, and the petitioner was directed to appear before the authority on 25.05.2026.
FULL TEXT OF THE JUDGMENT/ORDER OF KARNATAKA HIGH COURT
Petitioner has challenged the validity of the orders of adjudication passed under Section 73 of the CGST / KGST Act at Annexures-A, B and C series.
2. It is the contention of the petitioner that for the same tax period, 2 orders are passed at Annexures-A and C series on the same ground of mismatch of Input Tax Credit (ITC). Insofar as the order at Annexure-B1, it is submitted that the order at Annexure-B1 is passed noticing discrepancies between GSTR-1 and GSTR-3B. It is further submitted that as all the orders passed are ex parte orders, the petitioner may be granted an opportunity to take their stand by way of reply to the show cause notice. It is submitted that the lapse in not replying to the show cause notice was bonafide as the registration was cancelled in the year 2023 itself.
3. Learned Additional Government Advocate submits that the notices were served as is evident from the observations made in the impugned orders. Accordingly, it is submitted that the petitioner is liable in light of non-participation in the proceedings.
4. Perused the orders.
5. It is the contention of the petitioner that orders at Annexures-A and C series are passed regarding the same tax period and amounts to duplication of orders. Insofar as all the impugned orders, admittedly the orders are ex-parte orders. In light of the assertion of the petitioner as noticed above, it would be appropriate to remit the matter for reconsideration by putting the petitioner on terms. Such order is required to be passed in light of the factual findings which petitioner submits would be demonstrated upon material to be placed before the Authority.
6. Accordingly, the orders at Annexures – A series, B series and C series are set aside. The matter is remitted to the 2nd respondent for adjudication from the stage of reply to the show cause notice. All proceedings remitted for reconsideration are to be adjudicated by the 2nd respondent. Petitioner is to be put on terms and is directed to pay 10% of the demand of the tax at Annexure-A series and B series. All contentions on merits are kept open.
7. Petitioner to appear before the 2nd respondent without further notice on 25.05.2026.
8. Petition is accordingly disposed of.
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