Writ Petition No. 36292 of 2024 · The High Court
Case Details
- 1 - NC: 2025:KHC:14428 WP No. 36292 of 2024 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 3RD DAY OF APRIL, 2025 BEFORE THE HON'BLE MR JUSTICE S.R.KRISHNA KUMAR WRIT PETITION NO.36292 OF 2024 (T-RES) BETWEEN: SHRI K J VISHWANATHA, AGED ABOUT 70 YEARS, NAME IN GST REGISTRATION: KUMBENAHALLY JAVARE GOWDA VISHWANATH, OCCUPATION: PWD CONTRACTOR, NO.259, 1ST CROSS, BSK 3RD STAGE, 3RD PHASE, 2ND BLOCK, BENGALURU, BENGALURU URBAN – 560 085. (BY SRI. LAKSHMI MENON, ADVOCATE) AND: 1. STATE OF KARNATAKA FINANCE DEPARTMENT, II FLOOR, VIDHANA SOUDHA, BENGALURU – 560 001, REP. BY ADDL. CHIEF SECRETARY, …PETITIONER 2. DEPUTY COMMISSIONER OF COMMERCIAL TAXES (AUDIT) - 2.4, DGSTO-2, NO.642, 2ND FLOOR, PIONEER PLAZA, KENCHENA HALLI MAIN ROAD, NEAR GOPALAN ARCADE MALL, RAJA RAJESHWARI NAGARA, BENGALURU – 560 098. 3. JOINT COMMISSIONER OF COMMERCIAL TAXES DGSTO – 2, BENGALURU – 560 047. 4. OFFICE OF THE COMMISSIONER OF COMMERICAL TAXES ADMIN
Legal Reasoning
Digitally signed by CHANDANA B M Location: High Court of Karnataka - 2 - NC: 2025:KHC:14428 WP No. 36292 of 2024 VANIJA THERIGE KARYALAYA GHANDHI NAGAR KALIDASA ROAD BENGALURU …RESPONDENTS
Legal Reasoning
(BY SMT. JYOTHI M.MARADI, HCGP) THIS WRIT PETITION IS FILED UNDER ARTICLE 226 OF THE CONSTITUTION OF INDIA PRAYING TO SET ASIDE THE INTIMATION TO SHOW CAUSE NOTICE ISSUED BY THE RESPONDENT (BEARING DATED REFERENCE NO. “NIL”) (ANNEXURE-A) AND ETC. 17.10.2022 NO.2 THIS PETITION, COMING ON FOR ORDERS, THIS DAY, ORDER WAS MADE THEREIN AS UNDER: CORAM: HON'BLE MR JUSTICE S.R.KRISHNA KUMAR ORAL ORDER In this petition, petitioner seeks the following reliefs:- "a) To issue a writ of Certiorari or order or direction in the nature of Certiorari to set aside the Intimation to show Cause Notice issued by the Respondent No.2 dated 17.01.2022 (bearing Reference No.”NIL’) (Annexure-A); b) To issue a writ of Certiorari or order or direction in the nature of Certiorari to set aside the Summary Show Cause Notice issued by the Respondent No.2 dated 15.11.2022 (bearing Reference no “NIL’) (Annexure-B); c) To issue a writ of Certiorari or order or direction in the nature of Certiorari to set aside and quash the Impugned Order in Original dated 17.12.2022 passed by Respondent No.2 under section 73(09) of the CGST/KGST Act (bearing Reference No. “NIL”) (Annexure-C); - 3 - NC: 2025:KHC:14428 WP No. 36292 of 2024 d) To issue a writ of Certiorari or order or direction in the nature of Certiorari to set aside and quash the Impugned Order in Appeal bearing No.GST:ADT:AP:36/2022-2023 dated 06.06.2023 passed by the Joint Commissioner of Commercial Taxes (Appeals) – 2 under section 107(11) of the CGST/KGST Act, 2017 (Annexure-E); e) Pursuant to setting aside the above orders, to issue a writ of Certiorari or order or direction in the nature of Certiorari to quash the Endorsement dated 18.11.2023 bearing No.DCCT(A) – 2.4/T.No.561/23-24, issued by Respondent No.2 (Annexure-G) pursuant to which an amount of Rs.21,78,711/- has been recovered from the Electronic Cash Ledger and Electronic Credit Ledger of the Petitioner on 16.11.2024, which is in excess of the pre-deposit of 30% that ought to have been paid to seek stay of the remaining amount of demand as confirmed in the Order in Appeal dated 06.06.2023 GST:ADT:AP:36/2023 Annexure-E and refund such excess amount to the Petitioner. f) Alternatively, in the event the demand under section 73 of the CGST/KGST Act, 2017, is not set aside in toto / or revives due to operation of law, then, issue a writ of Mandamus order or direction in the nature of Mandamus directing the Respondent No.2 to stay recovery proceedings and to refund the amount recovered in excess of the pre- deposit of 30% i.e. Rs.21,78,711/- which was recovered by the Petitioner from the Electronic Cash Ledger and Electronic Credit Ledger of the Petitioner dated 16.11.2024; GSTIN:29ABOPV2574P1ZG (Annexure-J); - 4 - NC: 2025:KHC:14428 WP No. 36292 of 2024 g) Grant any other orders that this Hon’ble Court deems fit and proper in the interest of justice.” 2. Heard learned counsel for the petitioner and learned HCGP for the respondents and perused the material on record. 3. A perusal of the material on record will indicate that the issue in controversy involved in the present petition is directly and squarely covered by the judgment of this Court in the case of M/s.Sadhana Enviro Engineering Services vs. Joint Commissioner of Central Tax & others – W.P.No.6138/2020 dated 03.09.2024, which reads as under:- 2. Heard learned Senior counsel for the petitioner and learned counsel for the respondents – revenue and learned AGA for the State and perused the material on record. 3. Learned Senior counsel for the petitioner submitted that though several contentions have been urged by the petitioner who has also sought for various reliefs, during the pendency of the present petition, a new provision i.e., Section 16(5) has been inserted by “The Finance (No.2) Act, 2024” vide Central Act 15 of 2024, in which, Clause No.118 provides for condonation of delay in availment of credit and extended the time limit by providing that for supplies pertaining to the financial years 2017-18, 2018-19, 2019-20 and 2020-21, the petitioner would be - 5 - NC: 2025:KHC:14428 WP No. 36292 of 2024 entitled to avail / claim credit in any return filed up to 30.11.2021. It is submitted that the said “The Finance (No.2) Act, 2024” received presidential asset on 16.08.2024 and would be notified shortly. It was further submitted that in cases where assessees had paid amounts as pre-deposit under court orders or in appeal proceedings or amounts recovered by the respondents – revenue are paid by the assessees pursuant to recovery proceedings, the embargo contained in Clause 150 of the said “The Finance (No.2) Act, 2024” would not apply and was not applicable to the assessees, who would not be covered by the said embargo and consequently, they would be entitled to refund of the said amounts. It is therefore submitted that without going into the various other contentions urged by the petitioner and reliefs sought for by it and without expressing any opinion on the same,
Decision
the present petition may be disposed of with a direction to consider and implement and give effect to the amended provisions contained in Section 118 of “The Finance (No.2) Act, 2024” relating to insertion of Section 16(5) to the CGST Act / KGST Act within a stipulated time frame. 4. Per contra, learned counsel for the respondents – revenue and learned AGA for the respondents – State jointly and fairly submit that it is true that Section 16(5) was inserted vide Clause 118 of “The Finance (No.2) Act, 2024” and that the same was applicable to the petitioner and other assessees and the time for filing returns and availing input tax credit would stand extended upto 30.11.2021. It is also submitted that since presidential asset has already - 6 - NC: 2025:KHC:14428 WP No. 36292 of 2024 been received to “The Finance (No.2) Act, 2024”, necessary Notification would be issued shortly and as such, the present petition may be disposed of accordingly. 5. As rightly contended by the learned Senior counsel for the petitioner as well as learned counsel for the respondents – revenue and learned AGA for the State, Section 16(5) was inserted into the CGST Act vide Clause 118 of the “The Finance (No.2) Act, 2024”, which reads as under:- “118. In Section 16 of the Central Goods and Services Act, with effect from the 1st day of July, 2017, after sub-section(4), the following sub-sections shall be inserted, namely:- (5) Notwithstanding anything contained in sub- section(4), in respect of an Invoice or Debit note for supply of goods or services or both pertaining to the financial years, 2017-18, 2018-19, 2019-20 and 2020-21, the registered person shall be entitled to take input tax credit in any return under Section 39 which is filed up to the thirtieth day of November, 2021. (6) xxxxxxxxxxxxx (i) xxxxxxxxxxxxxx (ii)xxxxxxxxxxxxxx ” 6. In view of the aforesaid amendment by inserting Section 16(5) to the CGST / KGST Act, the present petition deserves to be disposed of relegating the parties to the original authority to implement and give effect to the said provisions after providing sufficient and reasonable opportunity to the petitioner and hearing them and proceed - 7 - NC: 2025:KHC:14428 WP No. 36292 of 2024 further in accordance with law and by issuing certain directions in this regard. 7. In the result, I pass the following:- ORDER (i) Petition is hereby disposed of. (ii) The parties are relegated to the stage of show cause notice at Annexure-C dated 13.02.2020 issued by the respondent(s) and the respondents are directed to give effect to and implement the amended provisions contained in Section 118 of “The Finance (No.2) Act, 2024” relating to insertion of Section 16(5) to the CGST Act / KGST Act by providing sufficient and reasonable opportunity and hear the petitioner and proceed further in accordance with law within a period of one month from the date of receipt of a copy of this order. (iii) The impugned blocking of the Input Tax Credit (ITC) ledger of the petitioner vide Annexure-F dated 03.02.2020 is hereby quashed. (iv) The respondents are directed to unblock and release the credit balance of the petitioner in their ITC Ledger / Account, if not already released, immediately / forthwith upon receipt of a copy of this order without any delay. (v) All rival contentions on all other prayers sought for by the petitioner including the challenge to the statutory provisions are kept open and no opinion is expressed on the same. - 8 - NC: 2025:KHC:14428 WP No. 36292 of 2024 4. In view of the aforesaid facts and circumstances and the judgment of this Court in M/s.Sadhana Enviro Engineering’s case supra, I am of the view that the present petition also deserves to be allowed and disposed of in terms of the said judgment. 5. Learned counsel for the petitioner submits that the petitioner had deposited a total sum of Rs.20,41,080/- and the same is to be directed to be made subject to the final outcome of the proceedings pursuant to this Court’s order and in the event petitioner is successful the same may be directed to be refunded to the petitioner along with the amount of Rs.21,78,711/- which is already deducted from the credit ledger of the petitioner as per Annexures – J and J1. 6. The said submission is placed on record. 7. In the result, I pass the following:- ORDER (i) Petition is hereby disposed of in terms of the judgment of this Court in the case of M/s.Sadhana Enviro Engineering Services vs. Joint Commissioner of Central Tax & others – W.P.No.6138/2020 dated 03.09.2024. - 9 - NC: 2025:KHC:14428 WP No. 36292 of 2024 (ii) The impugned Order at Annexure-C dated 17.12.2022 and impugned Summary at Annexure-B dated 15.11.2022 and the impugned Order dated 06.06.2023 at Annexure – E are hereby quashed. (iii) The parties are relegated to the stage of show cause notice dated 17.10.2022 issued by the respondent(s) and the respondents are directed to give effect to and implement the amended provisions contained in Section 118 of “The Finance (No.2) Act, 2024” relating to insertion of Section 16(5) to the CGST Act / KGST Act by providing sufficient and reasonable opportunity to hear the petitioner and proceed further in accordance with law within a period of one month from the date of receipt of a copy of this order. (iv) It is further directed that in the event petitioner is successful in the proceedings pursuant to the present order, the respondents shall refund a sum of Rs.20,41,080/- deposited by the petitioner as well as a sum of Rs.21,78,711/- debited from the electronic ledger of the petitioner within a period of four weeks from the date of conclusion of the proceedings. - 10 - NC: 2025:KHC:14428 WP No. 36292 of 2024 (v) All rival contentions on all other prayers sought for by the petitioner including the challenge to the statutory provisions are kept open and no opinion is expressed on the same. Sd/- (S.R.KRISHNA KUMAR) JUDGE SV List No.: 1 Sl No.: 8