2025(07)LCX0085

Basavaraj V Sajjan

Versus

The Deputy Director

WRIT PETITION NO. 200889 OF 2025 decided on 01-07-2025

NC: 2025:KHC-K:3536

IN THE HIGH COURT OF KARNATAKA

KALABURAGI BENCH

DATED THIS THE 1^ST DAY OF JULY, 2025

BEFORE

THE HON'BLE MR. JUSTICE M.I.ARUN

WRIT PETITION NO.200889 OF 2025 (T-RES)

BETWEEN:

SHRI. BASAVARAJ V. SAJJAN
S/O. VIRUPAKSHAPPA,
OFFICE AT SULEPETH POST,
TQ.CHINCHOLI,
KALABURAGI – 585324.
                                                                        …PETITIONER
(BY SRI. DEVI PRASAD GANPATRAO, AND
SRI. PRAKASH D., ADVOCATES)

AND:

1. THE DEPUTY DIRECTOR
OFFICE OF THE ADDITIONAL DIRECTOR
GENERAL, DIRECTORATE GENERAL OF GST,
INTELLIGENCE, BELAGAVI ZONAL UNIT,
SHRI. LAXMI COMPLEX,
NO.4855/83, SADASHIV NAGAR,
1ST CROSS, APMC ROAD,
BELAGAVI–590019.

2. THE ADDITIONAL DIRECTOR
OFFICE OF THE ADDITIONAL DIRECTOR
GENERAL, DIRECTORATE GENERAL OF GST,
INTELLIGENCE, BELAGAVI ZONAL UNIT,
SHRI. LAXMI COMPLEX,
NO.4855/83, SADASHIV NAGAR,
1ST CROSS, APMC ROAD, BELAGAVI–590019.

3. THE ASSISTANT COMMISSIONER
OF CENTRAL TAX AND CENTRAL EXCISE,
BEHIND TV STATION, KAPNOOR,
KALABURAGI–585104.

4. THE ADDITIONAL COMMISSIONER
OF CENTRAL TAX AND CENTRAL EXCISE,
NO.71 CLUB ROAD, BELAGAVI-590001.
                                                                        …RESPONDENTS
(BY SRI. GIRISH HULIMANI, ADVOCATE)

THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA, PRAYING TO A) ISSUE A WRIT OF CERTIORARI, OR SUCH OTHER WRIT, ORDER OR DIRECTION AS THIS HON’BLE COURT MAY DEEM FIT BY QUASHING SHOW CAUSE NOTICE SL. NO. 31/2023-24 BIZU DATED 30.09.2023 MARKED AS ANNEXURE-C ISSUED BY RESPONDENT NO.2 B) TO HOLD THAT THE SHOW CAUSE NOTICE AT ANNEXURE-C IN SCN SL. NO.31/2023-24 BIZU DATED 30.09.2023 UNDER 74 OF THE ACT IS WITHOUT JURISDICTION C) TO HOLD THAT THE SHOW CAUSE NOTICE AT ANNEXURE-C IN SCN SL. NO. 31/2023-24 BIZU DATED 30.09.2023 UNDER 74 OF THE ACT OUGHT TO HAVE BEEN ISSUED UNDER 73(4) OF THE ACT D) TO MODIFY THE ADJUDICATION ORDER IN OIO.BEL-EXCUS-000-DIV-ADC-ASC82/2024-25-GST DATED 28.11.2024 AT ANNEXURE-“C1” PASSED BY RESPONDENT NO. 4 AS AN ORDER UNDER SECTION 73(4) OF THE CGST ACT INSTEAD OF ORDER UNDER SECTION 74(1) OF THE ACT. E) TO PERMIT THE PETITIONER FOR AVAILING THE AMNESTY SCHEME IN TERMS OF SECTION 128A OF THE CGST/SGST ACT 2017.

THIS PETITION, COMING ON FOR FURTHER HEARING, THIS DAY, ORDER WAS MADE THEREIN AS UNDER:

CORAM: HON'BLE MR. JUSTICE M.I.ARUN

ORAL ORDER

(PER: HON'BLE MR. JUSTICE M.I.ARUN)

Petitioner is registered under the provisions of Central Goods and Services Tax Act / Karnataka Goods and Services Tax Act, 2017 (for short ‘CGST / KGST Act’) and he has involved in the business of works contract services. He has filed the necessary returns for the assessment year 2018-19. However, the returns filed by the petitioner was not accepted and proceedings were initiated under Section 74 of CGST / KGST Act and the impugned order dated 28.11.2024 at Annexure-C1 to the writ petition came to be passed.

2. Though several prayers are made in the writ petition, in the course of arguments, the counsel for the petitioner submits that he would pay amounts as determined in the impugned order dated 28.11.2024 vide Annexure-C1 to the writ petition. He submits that he would be satisfied if the same were to be treated as an order under Section 73 of the CGST / KGST Act rather than an order under Section 74 of the CGST / KGST Act and he would limit his prayer to the same.

3. Section 73 of the CGST / KGST Act is in respect of determination of tax not paid or short paid or erroneously refunded or input tax credit wrongly availed or utilized for any reason other than fraud or any willful-misstatement or suppression of facts. Section 74 proceedings are initiated for determination of tax not paid or short paid or erroneously refunded or input tax credit wrongly availed or utilized by reason of fraud or any wilful-misstatement or suppression of facts.

4. In the instant case, it is submitted that the petitioner has done some work for the Public Works Department of the State and he has received certain consideration for the same. It is submitted by the petitioner that he has not received the differential amount payable towards GST from the PWD and hence, there has been delay in payment of GST. It is further submitted that he has disclosed his transaction with PWD to the Income Tax Department as well as to the respondents herein. However, the authorities concerned has come to the conclusion that if there is any due from PWD to the petitioner, it is for the petitioner to recover and it cannot be a ground for non payment of GST and for that reasons the impugned order has been passed. It is submitted under the circumstances, petitioner cannot be treated as being guilty of suppression of facts and it is prayed that the amount determined by the authorities concerned have already been paid by the petitioner and if any amount is still due he would pay the same. But his only prayer is that the impugned order should be treated as an order under Section 73 of the Act and not 74.

5. Per contra, the learned counsel for the respondents justifies the impugned order and prays for dismissal of the writ petition. However, he is not able to answering in the negative in respect of the fact that the petitioner in the instant case had brought to the notice of the respondents about his transaction with the Public Works Department and the consideration amount received by him from PWD.

6. Under the circumstances, given the peculiar facts and circumstances of the case, it has to be held that there was short payment by the petitioner in respect of payments towards GST, but there was no suppression of facts. Under the said circumstances, I am of the opinion that it is appropriate to treat the impugned order at Annexure-C1 to the writ petition as an order passed under Section 73 of the CGST / KGST and not under Section 74 of the CGST / KGST Act.

Ordered accordingly.

Sd/-    
(M.I.ARUN)
JUDGE