Vaishan Traders IV Vs Deputy Commissioner of Commercial Taxes (Karnataka High Court)
Karnataka High Court recently disposed of a writ petition filed by Vaishan Traders IV challenging the seizure of goods and subsequent proceedings initiated under the Karnataka Goods and Services Tax Act, 2017 (KGST Act). The petitioner sought relief against an order dated November 12, 2024, which outlined discrepancies in their submitted documents, a seizure order issued on February 6, 2024, and the associated summons. The petitioner contended that the authorities failed to comply with Section 67(1) before invoking Section 67(2), rendering the proceedings unlawful.
The petitioner’s counsel argued that compliance with Section 67(1), which mandates the proper basis for searches, was a prerequisite for invoking Section 67(2) to conduct searches and seizures. Without adherence to this requirement, the seizure and related actions were deemed procedurally flawed. The counsel further contended that the communication issued on November 12, 2024, was arbitrary and caused undue hardship to the petitioner.
On the other hand, the state counsel maintained that the November 12 communication was not a final order but merely a notice allowing the petitioner to respond to discrepancies. It was argued that the petitioner was given a fair opportunity to explain their position and that no prejudice or hardship would arise if they participated in the proceedings.
