Facts of the Case

Sri C Ananda Kumar, a contractor executing works for various government departments in Chamarajanagar district, challenged three orders passed under Section 73(9) of the KGST/CGST Act, 2017 by the Commercial Tax Officer (Enforcement) and the Commercial Tax Officer (Audit-II), for the tax periods 2018-19, 2019-20 and 2020-21, dated 27.03.2024, 12.08.2024 and 09.09.2024 respectively. Show-cause notices had been issued on 26.12.2023, 04.03.2024 and 25.03.2024 for the three periods. The petitioner filed a reply dated 16.01.2024 to the 2018-19 show-cause notice but did not reply to the notices for the remaining two periods. The petitioner also sought a mandamus directing certain Executive Engineers to pay GST/differential GST pursuant to representations dated 26.06.2023 and 27.02.2025. The petition, filed under Article 226, was disposed of by oral order dated 15.12.2025 by Justice S.R. Krishna Kumar.

Issues Involved

  1. Whether the order for tax period 2018-19 was vitiated for having been passed without considering the petitioner's reply and without a personal hearing.
  2. Whether the orders for tax periods 2019-20 and 2020-21, passed ex parte for non-filing of reply, deserved to be set aside given the bona fide reasons pleaded by the petitioner.

Petitioner's Arguments

  • For 2018-19, the respondent passed the impugned order without considering the reply dated 16.01.2024 and without granting an opportunity of personal hearing.
  • For 2019-20 and 2020-21, due to bona fide reasons and unavoidable circumstances, the petitioner could not furnish replies along with documents, and the matter deserved to be remitted for reconsideration with an opportunity to submit replies and be heard.

Respondent's Arguments

  • The learned AGA supported the impugned orders and submitted there was no merit in the petition, which was liable to be dismissed.

Court Order / Findings

  • The Court found that the order for 2018-19 was passed without considering the reply dated 16.01.2024 and without granting an opportunity to produce necessary documents.
  • For 2019-20 and 2020-21, considering the bona fide reasons and unavoidable circumstances pleaded, and adopting a justice-oriented approach, the Court deemed it appropriate to set aside all three impugned orders.
  • All three orders dated 27.03.2024, 12.08.2024 and 09.09.2024 were set aside; the fourth respondent was directed to consider the reply dated 16.01.2024 and proceed in accordance with law.
  • The petitioner was granted liberty to submit additional reply/documents for all periods, and the fourth respondent was directed to afford a reasonable opportunity of personal hearing and proceed further in accordance with law, with the petitioner directed to appear on 02.02.2026 without awaiting further notice, failing which the order would stand automatically recalled.

Important Clarification

  • Assessment orders under Section 73(9) of the CGST/KGST Act that are passed without considering an assessee's reply already on record, or without affording a personal hearing, are liable to be set aside on natural justice grounds, and the Court may condone non-filing of replies for bona fide reasons by directing a fresh opportunity rather than deciding the tax demand itself.

Sections Involved

  • Section 73(9) of the CGST/KGST Act, 2017 — requires the proper officer to determine the tax, interest and penalty payable after considering the representation made by the person chargeable with tax.

Decision – In Favour of

Disposed of with directions, in favour of the Assessee — all three impugned assessment orders were set aside and the matter remitted for fresh adjudication after affording a personal hearing.

Related Case Laws

  • Other Karnataka High Court rulings setting aside Section 73/74 CGST/KGST assessment orders passed without considering the assessee's reply or granting a personal hearing.

Case Details

  • Court: High Court of Karnataka at Bengaluru
  • Case No.: WP No. 20123 of 2025 (T-RES); NC: 2025:KHC:53319
  • Coram: Hon'ble Mr. Justice S.R. Krishna Kumar
  • Date of Order: 15.12.2025

Link to Download the Order

You can view/download the order here.

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