Facts of the Case

M/s International Institute For Learning (India) Pvt. Ltd. challenged a show-cause notice dated 26.11.2024 issued under Section 73(1) of the KGST Act, the consequential order dated 27.02.2025 under Section 73(9) confirming a demand of Rs.9,24,369, and a subsequent rectification order dated 06.08.2025 rejecting the petitioner's Section 161 application (which had instead directed it to file an appeal). The department had earlier issued a Form GST ASMT-10 notice and a Form DRC-01A pre-intimation, to none of which the petitioner responded. The petitioner claimed it only became aware of the entire chain of proceedings when it noticed debits made by its bank pursuant to recovery.

Issues Involved

  1. Whether an ex-parte demand order should be set aside where the assessee claims none of the preceding notices (ASMT-10, DRC-01A, or the SCN) were ever effectively communicated to it.
  2. Whether rejection of a rectification application, directing the assessee to an appeal instead, bars writ relief given the GST Appellate Tribunal was not yet constituted.

Petitioner's Arguments

  • None of the notices were communicated or physically served; the petitioner became aware of the proceedings only upon noticing debits by its bank, following which it promptly sought rectification under Section 161.
  • Since the GST Appellate Tribunal has not been constituted, the petitioner has no option but to approach the writ court.

Respondent's Arguments

  • The pre-intimation and show-cause notices were duly communicated electronically by uploading them on the GST portal and by e-mail; the petitioner cannot claim ignorance, and the petition is without merit.

Court Order / Findings

  • Though the fact of electronic communication was disputed, it remained undisputed that the petitioner did not respond to the notices or contest the proceedings, resulting in the ex-parte order.
  • Rejection of the rectification application did not amount to a merger barring the Court's jurisdiction under Articles 226 and 227.
  • Adopting a justice-oriented approach given the petitioner's assertion of bona fide inability to respond, the Court set aside the order dated 27.02.2025 and remitted the matter to the stage of filing a reply to the show-cause notice.
  • The petitioner was directed to appear on 13.11.2025 without further notice, with the order to stand automatically recalled and the petition revived if the petitioner failed to appear.

Important Clarification

  • Rejection of a Section 161 rectification application (even where it directs the assessee to an appellate remedy instead) does not by itself operate as a merger that ousts the writ court's jurisdiction, particularly where the GST Appellate Tribunal remains unavailable.
  • A bona fide claim of non-receipt of electronically served notices, though contested by the department, continues to justify a conditional "one more opportunity" remedy rather than outright dismissal.

Sections Involved

  • Section 73(1)/(9) of the CGST/KGST Act, 2017 — show-cause notice and adjudication for tax short-paid.
  • Section 161 of the CGST Act, 2017 — rectification of errors apparent on the face of the record.

Decision – In Favour of

In favour of the Assessee — the ex-parte demand order was set aside and the matter remitted for a fresh reply and hearing.

Case Details

Court: High Court of Karnataka at Bengaluru — Case No.: WP No. 26846 of 2025 (T-RES) — Neutral Citation: 2025:KHC:40222 — Coram: Hon'ble Justice S.R. Krishna Kumar — Date of Order: 10 October 2025.

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