M/S. E-SPORTS COMPANY v. THE UNION OF INDIA

(BY SRI. PALLAVA R., ADVOCATE) AND:

1. THE UNION OF INDIA, REPRESENTED BY ITS SECRETARY, MINISTRY OF FINANCE, - 2 - NC: 2025:KHC:31518 WP No. 23289 of 2025 HC-KAR DEPARTMENT OF REVENUE, JEEVAN DEEP BUILDING, SANSAD MARG, NEW DELHI - 110 001.

2. THE STATE OF KARNATAKA, REPRESENTED BY ITS PRINCIPAL SECRETARY, DEPARTMENT OF FINANCE, VIDHANA SOUDHA, AMBEDKAR VEEDHI, BENGALURU – 560 001.

3. THE COMMISSIONER OF COMMERCIAL TAXES, COMMERCIAL TAXES DEPARTMENT (GST), COMMERCIAL TAXES OFFICE -1, 1ST MAIN ROAD, GANDHINAGAR, BENGALURU - 560 001.

4. THE JOINT COMMISSIONER OF COMMERCIAL TAXES, LOCAL GOODS AND SERVICES, TAXES OFFICE (LGSTO) - 320, COMMERCIAL TAXES HOUSE, P.B.ROAD, NAVANAGAR, HUBBALLI - 580 001.

5. THE ASSISTANT COMMISSIONER OF COMMERCIAL TAXES, LOCAL GOODS AND SERVICES, TAXES OFFICE (LGSTO) - 320, COMMERCIAL TAXES HOUSE, P.B.ROAD, NAVANAGAR, HUBBALLI – 580 001. (BY SRI. JEEVAN J.NEERALGI, ADVOCAE FOR R1; SRI. K.HEMA KUMAR, AGA FOR R2 TO R5) …RESPONDENTS - 3 - NC: 2025:KHC:31518 WP No. 23289 of 2025 HC-KAR THIS WP IS FILED UNDER ARTICLE 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE SHOW CAUSE NOTICE BEARING REFERENCE NO.ZA290125075450N DATED 16/01/2025 ISSUED BY THE R5 HEREIN GIVEN HEREIN AT ANNX-J AND AS WELL AS THE ORDER BEARING REFERENCE NO. ZA290225247224M DATED 27/02/2025 PASSED BY THE R5 HEREIN GIVEN HEREIN AT ANNX-K AND ETC. THIS PETITION, COMING ON FOR PRELIMINARY HEARING, THIS DAY, ORDER WAS MADE THEREIN AS UNDER: CORAM: HON'BLE MR. JUSTICE M.NAGAPRASANNA ORAL ORDER The petitioner is before this Court seeking the following prayers: "a) issue a Writ of Certiorari or any other appropriate Writ, Order or direction and QUASH the Show Cause Notice bearing reference No: ZA290125075450N dated 16.01.2025 issued by the 5th Respondent herein given herein at ANNEXURE-'J' and as well as the Order bearing reference No: ZA290225247224M dated 27.02.2025 passed by the 5th Respondent herein given herein at ANNEXURE-'K'; and b) Direct the Respondent No. 04 and 05 herein to consider the representation dated 04.07.2025 of the Petitioner firm which is given herein at ANNEXURE-'L' - 4 - NC: 2025:KHC:31518 WP No. 23289 of 2025 HC-KAR and pass Orders in accordance with law after granting sufficient opportunity of hearing; c) Pass any other or further Orders as this Hon'ble Court deems fit in the facts and circumstances of the case in the interest of justice and equity."

2. Heard Sri.Pallava R., learned counsel appearing for the petitioner, Sri.Jeevan J Neeralgi, learned counsel appearing respondent No.1, Sri.K.Hema Kumar, learned AGA appearing for respondent Nos.2 to 5 and have perused the material on record.

3. The petitioner is said to be a Partnership Firm constituted in the year 2005 and was assessed to value added tax. On the new regime i.e. the GST coming into force, the petitioner has been diligently making payments, is the averment. The issue that has driven the petitioner to this Court is issuance of a show cause notice seeking to show cause as to why GST registration of the petitioner should not be revoked or cancelled on certain premise. The show cause notice reads as follows. "Reference No.: ZA290125075450N Date: 16/01/2025 E SPORTS COMPANY DIAMAND POINT, - 5 - NC: 2025:KHC:31518 WP No. 23289 of 2025 HC-KAR CTS NO 2948, FIRST FLOOR, HUBLI, KOPPIKAR ROAD, Dharwad, Karnataka, 580020 GSTIN: 29AAKFP0469J1ZR Date: 23/12/2024 Application Reference Number (ARN): AA291224070112M Show Cause Notice for rejection of application for revocation of cancellation of registration This has reference to your application dated 23/12/2024 regarding revocation of cancellation of registration. Your application has Been examined and the same is liable to be rejected for the following reasons:

1. Any Supporting Document - Others (Please specify) - 4.As per adjudication order passed U/s 73 of GST Law you are having huge liability in the "electronic liability ledger". The details of pending dues are sent your registered e-mail ID After clearance of all dues, your appln. will be considered. You are hereby directed to furnish a reply to the notice within seven working days from the date of service of this notice. If you fail to furnish a reply within the stipulated date or fail to appear for personal hearing on the appointed date and time, the case will be decided ex parte on the basis of available records and on merits. Kindly refer the supportive document attached for case specific details."

4. Learned counsel for the petitioner submits that he would have submitted a reply to the show cause notice but for the reason that it depicts a post-decisional hearing as the notice indicates that his application would be considered only after clearance of all the dues. The learned counsel has justification that he has no dues to be cleared at all. In the light - 6 - NC: 2025:KHC:31518 WP No. 23289 of 2025 HC-KAR of the observation in the show cause notice, nothing is left to be replied, is the submission of the learned counsel by the petitioner.

5. Learned AGA would however dispute the position in contending that it may be wrong choice of words in the order, but nonetheless it is only a show cause notice. The said submission of the learned AGA would have been acceptable, but for the clear and unequivocal intention of the authority i.e. the Assistant Commissioner in issuing the notice and the words "After clearance of all dues, your appln. will be considered". This undoubtedly amounts to a post-decisional hearing. As the decision is taken that his application would be considered only after clearance of dues, the petitioner submits that he has justification that he has no dues at all. In that light, the show cause notice insofar as it determines the answer and then seeks a question by way of show cause, is unsustainable in law. It is apposite to refer to the judgment in SHEKHAR GHOSH - 7 - NC: 2025:KHC:31518 WP No. 23289 of 2025 HC-KAR vs. UNION OF INDIA,1 wherein at paras 14 to 17, it is observed as follows: “…. …. ….

14. A post-decisional hearing was not called for as the disciplinary authority had already made up its mind before giving an opportunity of hearing. Such a post-decisional hearing in a case of this nature is not contemplated in law. The result of such hearing was a foregone conclusion. ORDER [i] Order dated 27.02.2025 stands quashed. - 10 - NC: 2025:KHC:31518 WP No. 23289 of 2025 HC-KAR [ii] The words in the notice dated 16.01.2025 "After clearance of all dues, your appln. will be considered" stands obliterated. [iii] The petitioner along with the reply, shall appear before the respondent-Assistant Commissioner on

10.09.2025 at 2.30 p.m. [iv] The respondent-authority regulate procedure and take the proceedings to its logical conclusion. Ordered accordingly and Writ Petition is disposed. Sd/- (M.NAGAPRASANNA) JUDGE CBC List No.: 1 Sl No.: 45 CT:SS