E Frontline Recycling Pvt Ltd Vs Commercial Tax Officer (Karnataka High Court)
Summary: Karnataka High Court disposed of the writ petition filed by E Frontline Recycling Pvt Ltd concerning an ex parte adjudication order dated 19.03.2019 under Section 39 of the Karnataka Value Added Tax Act, 2003 for the tax period 2013-14. The petitioner contended that neither the notice nor the adjudication order had been served, possibly because of a change in its business address, and that it had already discharged the relevant tax liability through challans in Form No. 152.
It further submitted that it came to know about the proceedings only after attachment of its bank account, which impaired its business operations. The Revenue submitted that the payments claimed by the petitioner would have to be verified. The Court noted that the Additional Government Advocate did not dispute that, if the tax had in fact been remitted through the relied-upon challans, there would be no basis for the impugned adjudication. Accordingly, the Court granted liberty to the petitioner to approach the respondent with a certified copy of the order, detailed response and the challans forming Annexure-C Series.
The respondent was directed to verify the asserted remittances and recall the recovery proceedings if the challans were demonstrated to relate to the relevant tax period. The decision on such verification must be communicated to the petitioner within two weeks from receipt of the certified copy of the High Court’s order.
FULL TEXT OF THE KARNATAKA HIGH COURT ORDER
The petitioner’s grievance is with the Order dated 19.03.2019 [Annexure – A] under Section 39 of the Karnataka Value Added Tax Act, 2003 for the tax period 2013-14. The petitioner has filed an application for rectification of this Order, which is rejected informing the petitioner that the application is time barred. Mr. Anand B. C, the learned counsel for the petitioner, submits
- that the Adjudication Order is an ex parte Order,
- that the petitioner has not been served with the notice or the order possibly because of change in the business address, and
- that crucially the petitioner has discharged the liability for the subject tax period [as could be seen in the challans in Form No. 152 that is produced as Annexure – C Series to the writ petition].
Mr. Anand B. C also submits that if the tax liabilities are discharged, there is no justification for a subsequent Adjudication Order and that the petitioner has come to know about the proceedings only after the bank attachment and the bank attachment has impaired the petitioner’s business operations.
Mr. Hema Kumar, a learned Additional Government Advocate who accepts notice for the respondent, is heard in the circumstances. The learned Additional Government Advocate submits that even if the petitioner is to be admitted to any relief based on the challans relied upon, the respondent will have to duly verify the same. This Court observes that the learned Additional Government Advocate does not dispute that if indeed the tax is offered in terms of challans relied upon, there would be no basis for the adjudication in terms of the impugned Order. In the light of the afore, the following.
ORDER
[A] The petition stands disposed of with liberty to the petitioner to approach the respondent with a certified copy of this order immediately upon receipt thereof filing a detailed response enclosing the challans that are marked as Annexure – C Series.
[B] The respondent is called upon to verify the remittances asserted by the petitioner in terms of these challans and recall the recovery proceedings, if indeed the petitioner can demonstrate that the remittances under the challans [as per Annexure – C Series] relate to the tax period.
[C] The respondent shall communicate the decision in this regard to the petitioner within two [2] weeks from the date of receipt of a certified copy of this order.
