Gayatri Gururaj Purohit Vs State of Karnataka (Karnataka High Court)
Summary : The Karnataka High Court allowed Gayatri Gururaj Purohit’s writ petition and remanded the GST proceedings for the tax period 2017–18. The Commercial Tax Officer (Audit)-5, Belagavi, issued Form GST ADT-01 on 4 January 2021 to initiate an audit under Section 65 and issued the audit report on 11 November 2021. The officer then issued the pre-show-cause intimation in Form GST DRC-01A on 5 March 2022 and the show-cause notice summary in Form GST DRC-01 on 20 September 2022. The detailed adjudication order under Section 73 was dated 31 August 2023, and the order was uploaded on the GST portal on 7 September 2023.
The petitioner contended that the proceedings had gone ahead ex parte without proper notice. She challenged the detailed order and its summary in Form GST DRC-07 and sought a stay of the consequential recovery proceedings under Section 79. These included a Form GST DRC-13 notice issued to her banker on 10 January 2024 and Criminal Miscellaneous No. 457 of 2024 filed before the JMFC, Athani, on 23 May 2024 to recover the alleged GST dues.
The petitioner relied on the coordinate Bench’s decision in Imran K. Madiwale Vs State of Karnataka, which held that the officer who initiated and completed the GST audit could not then issue notice and adjudicate the same matter. The State’s counsel did not dispute that legal position. Treating the dispute as identical, the Court directed fresh consideration from the stage of replying to the Form GST DRC-01A intimation dated 5 March 2022 under Section 73(5). It directed the Joint Commissioner of Commercial Taxes (Administration) to assign the matter to a proper officer other than respondent No. 2 and allowed the petitioner to raise all contentions, including objections to the audit report.
Cases Discussed
- Imran K. Madiwale, Sole Proprietor of M/s. I. K. Groups of Companies Vs State of Karnataka & Anr. (Karnataka High Court, Dharwad Bench), W.P. No. 103328 of 2026 (T-RES), decided on 23 April 2026. The coordinate Bench held that the officer who initiated and completed the audit could not issue notice and adjudicate the same matter. It quashed the adjudication order and directed fresh consideration by a different officer from the DRC-01A reply stage. Followed.
FULL TEXT OF THE JUDGMENT/ORDER OF KARNATAKA HIGH COURT
This petition is filed seeking following reliefs:
“a) Issue a writ of Certiorari or any other appropriate writ, quashing the impugned ex parte summary of Order in Form GST DRC-07 date 07.09.2023 bearing RFN No.ZD290923008480D along with the Detailed Adjudication Order dated 31.08.2023 passed under Section 73 of the GST Act, 2017 by Respondent No.2 i.e. the Commercial Tax Officer (Audit)-5, Belagavi, produced at ANNEXURE-D;
b) Stay all consequential recovery proceedings initiated under section 79 of the Act including issuance of Form GST DRC-13, notice to the third person bearing No .CTO(Audit)-5/BGV/2023-24/B-521 dated 10.01/2024 vide ANNEXURE-E issued by Respondent No.2 i.e. Commercial Tax Officer (Audit)-5, Belagavi to the Petitioner’s banker and Criminal Misc. No.457/2024 pending before the Court of JMFC, Athani;
c) Grant such other reliefs as this Hon’ble Court deems fit in the interest of justice and equity.”
2. Heard Sri Girish A. Yadawad, learned counsel for petitioner and Sri Sharad V. Magadum, learned AGA for respondent No.1 and 2/State.
3. Facts in brief to file the present Writ Petition are as under:
3.1. The respondent No.2 on 04.01.2021 issued form GST ADT-01 for the Tax period 2017-18 initiating audit proceedings under Section 65 of the GST Act, 2017. Thereafter, on 11.11.2021, audit report/order under Section 65(6) of the KGST Act, 2017 and CGST Act, 2017 was issued by respondent No.2. Subsequently, respondent No.2 was also issued form GST DRC-01A(Part-A) an intimation of tax ascertained as payable under Section 73 of the GST Act, 2017 on 05.03.2022. On 20.09.2022, form GST DRC-01 summary of show cause notice was also issued by respondent No.2. Thereafter, respondent No.2 passed a detailed adjudication order on above stated forms on 31.08.2023, which was uploaded on GST portal on 07.09.2023. Thereafter, on 10.01.2024 respondent No.2 initiated recovery proceedings in form GST DRC-13 and also filed a Criminal Miscellaneous No.457 of 2024 before the JMFC Court, Athani on 23.05.2024 seeking recovery of the alleged GST dues pursuant to the impugned order.
4. The main grievance of the petitioner is that in the case she was placed ex-parte without issuing proper notice as contemplated under the provisions.
5. Learned counsel for the petitioner submits that in an identical matter co-ordinate bench of this Court in W.P.No.103328 of 2026 (T-RES) disposed of on 23.04.2026, allowed the writ petition and quashed the impugned order therein and remanded the matter to the concerned authority for fresh consideration from the stage of submitting a reply to the intimation of tax ascertained as being payable under Section 73(5) of the Goods and Services Tax Act, 2017. While remanding the matter, in was further ordered to assign the matter to any person/any proper officer other than respondent No.2, who has passed the impugned order.
6. The relevant paragraph of order passed by the co- ordinate bench in the aforesaid writ petition read as under:
“5. The second respondent initiated an audit under Section 65 of the Goods and Services Tax Act, 2017 and completed the audit report. The same Officer thereafter issued notice, conducted adjudication proceedings, and passed the final order. The respondent, having initiated the audit proceedings, could not have issued notice and adjudicated the matter.
6. In view of the above, the matter requires remand. Resultantly, the impugned order dated 23.08.2024 passed by respondent No.2 vide Annexure – C is quashed.
7. The Joint Commissioner for Commercial Taxes is directed to assign the matter to any person/any proper Officer other than the respondent No.2, who passed the impugned order. The matter is remanded for reconsideration afresh from the stage of submitting a reply to the state of intimation of tax ascertained as being payable under Section 73(5) of the Act in Form GST DRC- 01A dated 17.05.2024. The petitioner may raise all contentions, including the contentions as regards the audit report, which shall be considered by the proper officer, who shall proceed further, in accordance with the law.”
7. This position of law is not disputed by learned AGA.
8. Since the dispute involved in this petition is also identical, wherein as per the contention of the petitioner, the adjudicating authority has concluded all the proceedings, which is un-sustainable in law and in view of order passed by the co- ordinate bench stated afore, same benefit afforded to the petitioner in this petition to put forth her case from the stage of show cause notice. Accordingly, this Court proceeds to pass the following:
ORDER
(i) Writ petition is allowed.
(ii) The matter is remanded for reconsideration afresh from the stage of submitting a reply to the stage of intimation of tax ascertained as being payable under Section 73(5) of the Act in form GST DRC-01A dated 05.03.2022.
(iii) The Joint Commissioner of Commercial Taxes (Admn) is directed to assign the matter to any person/proper officer other than the respondent No.2, who passed the impugned order.
(iv) The petitioner may raise all contentions, including the contentions as regards the audit report, which shall be considered by the proper officer, who shall proceed further in accordance with law.
