GST adjudication order remanded as assessee was denied opportunity to reply; Court held that justice-oriented approach warranted fresh consideration under Section 73(9).

Case Title: Shri Hari Construction v. Assistant Commissioner of Commercial Taxes & Others
Court: High Court of Karnataka, Bengaluru
Petition No.: Writ Petition No. 7915 of 2025 (T-RES)
Date of Judgment: 03 April 2025
Relevant Sections: Sections 6, 50, 73(1), 73(9), 79(1)(e) of the CGST/KGST Act, 2017 and Rule 142(1A), 142(5), 100(1)–(3) of the CGST Rules, 2017
Category: Adjudication / Ex-parte order / Natural justice

Facts (Paras 3–5)

The petitioner, Shri Hari Construction, was served with a pre-intimation notice under Rule 142(1A) and a show-cause notice dated 27.04.2023 under Section 73(1) of the CGST/KGST Act, 2017 for alleged non-payment of GST. However, the petitioner did not respond to these communications, and the Assistant Commissioner passed an ex-parte order dated 10.07.2023 under Section 73(9), confirming a demand of ₹3,98,295/-, including tax, interest, and penalty.
Subsequently, a notice under Section 79(1)(e) directed the attachment of the petitioner’s bank account. The petitioner contended that neither the pre-intimation notice nor the show-cause notice was ever served, and he came to know of the proceedings only upon receipt of the attachment notice. His appeal filed before the Joint Commissioner (Appeals) was dismissed as time-barred, prompting him to approach the High Court.

Questions before the Court (Paras 2, 4 & 6)

1. Whether the ex-parte order passed under Section 73(9) without proven service of notice is valid.

2. Whether the High Court can exercise jurisdiction under Articles 226 and 227 despite dismissal of the appeal as time-barred.

3. Whether the matter merits remand in the interest of justice to allow the petitioner to contest the proceedings.

Observations (Paras 6–7)

The Court observed that the petitioner did not file any reply to the pre-intimation or show-cause notices, but it was undisputed that the proceedings had culminated ex-parte. The appellate order dismissing the appeal for limitation did not result in merger, and thus the writ jurisdiction was maintainable.
Justice S.R. Krishna Kumar emphasized that tax adjudication should balance revenue protection with procedural fairness. The petitioner’s assertion of non-service and bona fide inability to respond constituted sufficient cause to justify remand. The Court noted that adopting a justice-oriented approach was necessary since the GST Appellate Tribunal was not yet constituted.

Judgment (Paras 7–8)

The Court allowed the writ petition, set aside the order dated 10.07.2023, and remanded the matter to the Assistant Commissioner for reconsideration afresh. The petitioner was directed to appear before the authority on 28.04.2025 without waiting for notice. If he failed to appear, the Court’s order would automatically stand recalled, reviving the earlier order. The authority was instructed to provide reasonable opportunity to submit replies and evidence and to decide the case in accordance with law.

Summary of Cited Cases

Between Fine Lines

The ruling reinforces that ex-parte tax orders under Section 73(9), passed without ensuring actual service or opportunity, cannot withstand judicial scrutiny. Even where notices are uploaded electronically, if the taxpayer proves genuine non-receipt, courts may restore the right to reply and be heard. For the trade, this judgment underscores the importance of regularly monitoring the GST portal while also assuring that procedural lapses can be remedied through judicial recourse in the absence of an appellate tribunal.

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