Assistant Commissioner of Commercial Taxes Archives - Tax Heal https://www.taxheal.com/tag/assistant-commissioner-of-commercial-taxes Complete Guide for Income Tax and GST in India Thu, 20 Aug 2026 12:34:06 +0000 en-US hourly 1 https://wordpress.org/?v=7.1 Works Contractor Entitled To Tax Reimbursement For Work Executed Pre-GST But Billed Under GST Regime https://www.taxheal.com/c-m-poonacha-j-7.html Thu, 20 Aug 2026 12:29:59 +0000 https://www.taxheal.com/?p=138982 Works Contractor Entitled To Tax Reimbursement For Work Executed Pre-GST But Billed Under GST Regime Issue Whether a works contractor is entitled to tax reimbursement or adjustment for pre-GST executed work billed under the GST regime in accordance with transitional guidelines. Facts Assessment Period: The dispute pertains to Financial Year 2017–18 involving transitional works contracts.… Read More »

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Works Contractor Entitled To Tax Reimbursement For Work Executed Pre-GST But Billed Under GST Regime
Issue
Whether a works contractor is entitled to tax reimbursement or adjustment for pre-GST executed work billed under the GST regime in accordance with transitional guidelines.
Facts
  • Assessment Period: The dispute pertains to Financial Year 2017–18 involving transitional works contracts.
  • Transitional Contracts: The petitioner, a works contractor, executed contracts spanning both the Karnataka Value Added Tax (KVAT) and GST regimes for Respondent No. 2.
  • Tax Payment: Portions of work were completed during the pre-GST era but billed post-GST; the petitioner paid GST on these amounts without recovering the differential tax from the employer.
  • Representation & Order: The petitioner sought reimbursement/adjustment for the differential tax vis-à-vis KVAT and challenged an adjudication order passed for FY 2017–18 in a writ petition.
Decision
  • Transitional Benefit Allowed: In favor of Assessee. The writ petition was allowed in line with Chandrashekaraiah v. State of Karnataka, permitting the bifurcation and adjustment of pre- and post-GST components under the transitional framework.
  • Liberty to Appeal Assessment: Partly in favor of Assessee. Liberty was granted to the petitioner to challenge the 2017–18 assessment order through appropriate statutory proceedings.
Key Takeaways
  • Bifurcation of Transitional Contracts: Works completed prior to GST implementation but invoiced post-GST qualify for pre- and post-GST tax component adjustments to prevent unfair tax burdens on contractors.
  • Reimbursement Relief for Unrecovered Tax: Contractors who paid GST out-of-pocket without collecting it from employers are entitled to seek tax reconciliation and reimbursement under state transitional policies.
  • Preservation of Appellate Rights: The grant of transitional tax relief does not preclude taxpayers from separately challenging underlying assessment orders before statutory forums.
HIGH COURT OF KARNATAKA
Basayya
v.
Assistant Commissioner of Commercial Taxes
C.M. Poonacha, J.
WRIT PETITION NO.102192 OF 2026 (T-RES)
AUGUST  6, 2026
H.R. Kambiyavar, Adv. for the Petitioner. Smt. Nandini Somapur, AGA and G.S. Hulmani, Adv. for the Respondent.
ORDER
1. The present writ petition is filed seeking for the following reliefs:
“(a) Declare that the provisions of Section 7 (3) read with clause 6 of Schedule II of the GST Act is ultravires Article 366 (12A), (26A) (29A) (b) & (f) of the Constitution in view of and settled principles of law laid down by the Hon’ble Supreme Court regarding “works contract”.
(b) Issue a writ or such other order in the nature of Mandamus directing the Respondent No.2 to consider the reimburse the differential GST amount (being the difference between GST rate 12% or 18% and VAT rate) paid by the Petitioner without collecting it from Respondent No.2 for each of the works executed by the Petitioner, as per the sample work order dtd: 23/05/2017 to 15/06/2017 is produced at Annexures-C.
(c) Issue a writ or such other order directing the Respondent No.5 State Government to issue a circular/policy to address the issue of payment of GST on works contract which are executed under VAT regime or subsequent to introduction of GST but bills are raised after introduction of GST wherein, GST is not paid by the Respondents No.2 but is levied and paid by the Petitioner to the GST department till today.
(d) Declare that, GST being an Indirect tax is based on the concept of collect and pay, and the liability to pay is on the taxable person after collecting it from recipient of goods or services i.e., from the employer of works contract (Respondent No.2); AND hence direct Respondent No.2 to pay / refund / reimburse the tax amounts to the Petitioner who has already paid GST without collecting it from Respondents No.2 for contracts executed till today.
(e) Issue Writ of Certiorari or in the like nature of Certiorari quashing the an impugned adjudication order bearing No. CTO/LGSTO-310/ORDER-74/50/2024-25/B-5464, dtd: 04/02/2025 for the tax period F.Y. 2017-18, under Section 74 (9) of the Act, passed by Respondent No. 1 vide Annexure-D, to the petition.
(f) Pass such other orders as may be deemed appropriate under the circumstances of the case, in the ends of justice. “
2. It is jointly submitted by the learned counsel for the petitioner and the learned AGA that the question that arises for consideration in the present writ petition is with regard to the adjustment of Goods and Service Tax [GST] consequent to coming into force of the Central Goods and Service Taxes Act, 2017 [CGST Act]. It is further submitted that a Co-ordinate Bench of this Court in the case of Chandrashekaraiah v. State of Karnataka [2024]   (Kar)/NC:2023:KHC:15431/in W.P.No.9721/2019,Order dated 11.04.2023 has disposed of the writ petitions by issuing various guidelines. The operative portion of the said order is as under:
ORDER
(i) Petitions are hereby disposed of.
(ii) The Respondents-State and other Govt agencies/Respondents who have entered into works contract with the Petitioners are issued the following directions/guidelines:-
(a) Calculate the works executed pre-GST (prior to 1-72017) under KVAT regime and payments received by the Petitioners.
(b) The payments received by the Petitioners pre-GST for such of the works executed before 1-7-2017 are to be assessed under KVAT tax regime – either under COT or VAT scheme as applicable.
(c) Calculate the balance works to be completed or completed after 1-7-2017, in the original contract.
(d) Derive the rate of materials, KVAT items required or used to complete the balance works.
(e) Deduct the “KVAT” amount from those materials and the service tax, if applicable.
(f) Add the applicable “GST” on those items.
(g) Input Credit on the materials is to be arrived at and be set off as against the output GST, for those assessed under regular VAT.
(h) Further, the “tax difference” should be calculated on such balance works executed or to be executed after 17-2017 separately.
(i) Based on the result obtained on calculation of the tax difference on the contract value, concerned department/authority has to decide whether agreement needs to be changed or not.
(j) A supplementary agreement may be signed with the Petitioners for the revised GST-inclusive work value for the Balance Work completed or to be completed as determined above and in case the revised GST-inclusive work value for the Balance Work, completed or to be completed after 1-7-2017, is more than the original agreement work value, the Petitioners are to be paid/reimbursed, as the case may be, the differential tax amount by the concerned employer; so also, in case payments for works completed pre-GST are made post GST, the concerned employer has to pay or reimburse, as the case may be, the differential tax amount, to the Petitioners.
(iii) Petitioners are directed to submit comprehensive representations to the respective employers/Respondents within a period of 4 weeks from the date of receipt of a copy of this order, irrespective of whether they have completed the works pre-GST or post-GST or payments were received or yet to be received post-GST.
(iv) If such representations are submitted, the respective employers/Respondents are directed to consider and dispose of the same in the light of the aforesaid directions/guidelines as expeditiously as possible and at any rate within a period of 8 weeks from the date of submission of the representations.
(v) In view of the interim orders passed by this Court in the present petitions, such of the petitioners who had not filed their GST returns during the period after 1-72017 are permitted to file their returns/amended returns, pursuant to the calculation of the differential tax as per procedure above under GST regime, without insisting on interest or penalty or limitation.
(vi) The GST authorities are also directed not to take precipitative action against the Petitioners for a period of 6 months from the date of receipt of a copy of this order.
(vii) Liberty is reserved in favour of the petitioners to challenge any order/decision passed/taken by the respondents or the authorities, subsequent to this order and also take recourse to such remedies as available in law.”
3. It is further jointly submitted that the judgment of the Co-ordinate Bench of the Court in the case of Chandrasekharaiah (supra) was the subject matter of challenge before the Division Bench of this Court in the case of Principal Commissioner GST and Central Excise v. R. Chandrashekar [2026]  116 GST 656 (Kar)/NC:2026 KHC:28975-DB/in W.P.No.1587/2023 C/w W.A.No.1599/ 2023, W.A.No.1638/2023, W.A.No.1647/2023 & W.A.No.25/2024 Judgment dated 10.06.2026 The Division Bench has partly allowed the said appeals. The operative portion of the order of the Division Bench is as under:
“8. The dispute as to whether the writ petitioners would be entitled to reimbursement of the incremental tax paid or payable by them on account of the levy of GST is strictly a matter between the writ petitioners and the Employers with whom they had entered into the contracts. The contracts between the writ petitioners and the Employers would not alter the statutory scheme for the levy of GST. Thus, the liability of the writ petitioners to pay Goods and Services Tax (whether under the Central Goods and Services Tax Act, 2017, the State Goods and Services Tax Act, 2017 or the Integrated Goods and Services Tax Act, 2017) is required to be determined strictly in accordance with the provisions of the relevant statute. The question of the levy of GST, assessment, recovery, and enforcement is a matter of statutory prescription.
9. In view of the above, no directions could be issued permitting the filing of any revised returns contrary to the provisions of the statute. The plenary directions to waive the penalty, interest under the GST Acts or the limitation for filing returns/revised returns are also unsustainable.
10. The controversy as to the incremental tax burden arising on account of the change in the tax regime is, in essence, one between the writ petitioners and the Employers. In the context of such a dispute, no directions could be issued to the tax authorities regarding the levy, assessment, and collection of tax, penalty, or interest.
11. In the aforesaid view, the direction issued to the respondents to reimburse the differential tax is required to be construed as a direction only to the concerned Employers and not to the tax authorities.
12. Accordingly, the impugned order, to the extent it issues directions to the tax authorities, is set aside.
The appeal is disposed of in the aforesaid terms.”
4. In view of the judgment of the Division Bench, as referred above, the operative direction Nos.(v) and (vi) as ordered in case of Chandrashekaraiah (Supra) have been set aside.
5. In view of the aforementioned, the present writ petition is allowed in terms of the operative direction Nos.(i), (ii)(a) to (ii)(f), (iii), (iv) and (vii) as held in the case of Chandrashekaraiah (Supra) as noted above.
6. Since the petitioner has also impugned the assessment orders in the present writ petition, the petitioner is at liberty to assail the same in appropriate proceedings. The concerned authorities shall not take into account the time period spent by the petitioner in prosecuting the present petition.
7. In view of disposal of the writ petition, pending interlocutory applications, if any, do not survive for consideration and are disposed of.
]]> Government contractors are entitled to GST liability adjustments and supplementary agreements per established guidelines. https://www.taxheal.com/c-m-poonacha-j-3.html Mon, 10 Aug 2026 08:08:41 +0000 https://www.taxheal.com/?p=138139 Government contractors are entitled to GST liability adjustments and supplementary agreements per established guidelines. Government contractors are entitled to GST liability adjustments and supplementary agreements per established guidelines. Issue Whether government contractors executing pre-GST works are entitled to reimbursement/adjustment of additional GST liability through supplementary agreements and guidelines laid down in co-ordinate bench precedents. Facts… Read More »

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Government contractors are entitled to GST liability adjustments and supplementary agreements per established guidelines.

Government contractors are entitled to GST liability adjustments and supplementary agreements per established guidelines.

Issue

Whether government contractors executing pre-GST works are entitled to reimbursement/adjustment of additional GST liability through supplementary agreements and guidelines laid down in co-ordinate bench precedents.

Facts

  • Petitions Filed: Government contractors filed writ petitions seeking directions against respondents to execute supplementary agreements incorporating revised applicable GST rates pursuant to amendments to Notification No. 11/2017-CT (Rate), dated 28-6-2017.
  • Relief Sought: The petitioners also sought accounting and relief regarding interest and penalties imposed on them under various adjudication orders.
  • Core Grievance: The central issue related to the reimbursement and adjustment of additional GST liabilities arising from the implementation of the GST Act, 2017 on works initiated under the pre-GST (KVAT) regime.
  • Reliance on Precedent: Both parties jointly submitted that the issue was squarely covered by the co-ordinate bench decision in Chandrashekaraiah v. State of Karnataka (Karnataka).

Decision

  • Precedent Followed: The Court allowed the writ petitions in terms of the operative directions issued in the Chandrashekaraiah case.
  • Process for Calculation & Representation:
    • Respondents were directed to calculate works executed pre-GST under the KVAT regime and payments received, and add applicable GST components to those items.
    • Petitioners were granted 4 weeks to submit comprehensive representations to their respective employers/respondents.
    • Employers/respondents were directed to consider and dispose of these representations within 8 weeks of submission.
  • Liberty to Challenge: Petitioners were granted liberty to challenge any adverse orders passed by the respondents or to independently assail the underlying assessment orders in appropriate legal proceedings.
  • Final Verdict: Decided partly in favor of the assessee.

Key Takeaways

  • GST Adjustment on Transitional Contracts: Government contractors executing contracts spanning the pre-GST and post-GST regimes are entitled to seek supplementary agreements and adjustments for additional GST burdens.
  • Time-Bound Grievance Redressal: Contractors must submit detailed representations within specified timelines (4 weeks), which competent authorities are required to decide within a set timeframe (8 weeks).
  • Independent Challenge Preserved: Obtaining contractual or administrative tax adjustments does not preclude contractors from challenging statutory assessment orders, interest, or penalties in appropriate legal forums.
HIGH COURT OF KARNATAKA
Sadashiv S. Bennali
v.
Assistant Commissioner of Commercial Taxes
C.M. Poonacha, J.
WRIT PETITION NOS. 100867 & 100887 OF 2026 (T-RES)
JULY  15, 2026
Sourabh R. Mirje, Adv. for the Petitioner. Smt. Nandini Somapur, AGA for the Respondent.
ORDER
1. The W.P.No.100867/2026 is filed seeking for the following reliefs:
“WHEREFORE, in the light of the above facts and grounds, the Petitioner humbly prays that this Hon’ble Court may be pleased to:
A. Issue a Writ of Mandamus directing the Respondents to consider and dispose of the Petitioner’s representations in terms of the judgment dated 11.04.2023 passed by this Hon’ble Court in Sri Chandrashekharaiah v. State of Karnataka (Annexure K), in a time bound manner and consequently compute and pay the differential GST along with interest and penalty payable in respect of the works executed by the Petitioner.
B. Issue a Writ of Mandamus directing the Respondents to execute an appropriate supplementary agreement incorporating the applicable GST rate component as is set out in the Revision Notification which amended Notification No. 11/2017-Central Tax (Rate), Dated 28-6-2017 (Annexure B) while also accounting for the interest and penalty imposed on the Petitioner under the Adjudication Order – DRC 07 Ref No: ZD2910251137560 dated 30.10.2025 by the Respondent No.1 (digitally signed version is produced as Annexure J); and
C. Grant such other order or direction as this Hon’ble Court may deem fit in the interest of justice and equity. “
2. The W.P.No.100887/2026 is filed seeking for the following reliefs:
“WHEREFORE, in the light of the above facts and grounds, the Petitioner humbly prays that this Hon’ble Court may be pleased to:
A. Issue a Writ of Mandamus directing the Respondents to consider and dispose of the Petitioner’s representations in terms of the judgment dated 11.04.2023 passed by this Hon’ble Court in Sri Chandrashekharaiah v. State of Karnataka (Annexure K), in a time bound manner and consequently compute and pay the differential GST along with interest and penalty payable in respect of the works executed by the Petitioner.
B. Issue a Writ of Mandamus directing the Respondents to execute an appropriate supplementary agreement incorporating the applicable GST rate component as is set out in the Revision Notification (Annexure F) which amended Notification No. 11/2017-Central Tax (Rate), Dated 28-6-2017 (Annexure B) while also accounting for the interest and penalty imposed on the Petitioner under the Adjudication Order – DRC 07 Ref No: ZD291025115172T dated 30.10.2025 by the Respondent No.1 (digitally signed version is produced as Annexure J); and
C. Grant such other order or direction as this Hon’ble Court may deem fit in the interest of justice and equity. “
3. It is jointly submitted by the learned counsel for the petitioner and the learned AGA that the question that arises for consideration in the present writ petitions is with regard to the adjustment of Goods and Service Tax [GST] consequent to coming into force of the Central Goods and Service Taxes Act, 2017 [CGST Act]. It is further submitted that a Co-ordinate Bench of this Court in the case of Chandrashekaraiah v. State of Karnataka (Karnataka)/Order dated 11.04.2023 in W.P.No.9721/2019 has disposed of the writ petitions by issuing various guidelines. The operative portion of the said order is as under:
“ORDER
(i) Petitions are hereby disposed of.
(ii) The Respondents-State and other Govt agencies/Respondents who have entered into works contract with the Petitioners are issued the following directions/guidelines:-
(a) Calculate the works executed pre-GST (prior to 1-72017) under KVAT regime and payments received by the Petitioners.
(b) The payments received by the Petitioners pre-GST for such of the works executed before 1-7-2017 are to be assessed under KVAT tax regime – either under COT or VAT scheme as applicable.
(c) Calculate the balance works to be completed or completed after 1-7-2017, in the original contract.
(d) Derive the rate of materials, KVAT items required or used to complete the balance works.
(e) Deduct the “KVAT” amount from those materials and the service tax, if applicable.
(f) Add the applicable “GST” on those items.
(g) Input Credit on the materials is to be arrived at and be set off as against the output GST, for those assessed under regular VAT.
(h) Further, the “tax difference” should be calculated on such balance works executed or to be executed after 17-2017 separately.
(i) Based on the result obtained on calculation of the tax difference on the contract value, concerned department/authority has to decide whether agreement needs to be changed or not.
(j) A supplementary agreement may be signed with the Petitioners for the revised GST-inclusive work value for the Balance Work completed or to be completed as determined above and in case the revised GST-inclusive work value for the Balance Work, completed or to be completed after 1-7-2017, is more than the original agreement work value, the Petitioners are to be paid/reimbursed, as the case may be, the differential tax amount by the concerned employer; so also, in case payments for works completed pre-GST are made post GST, the concerned employer has to pay or reimburse, as the case may be, the differential tax amount, to the Petitioners.
(iii) Petitioners are directed to submit comprehensive representations to the respective employers/Respondents within a period of 4 weeks from the date of receipt of a copy of this order, irrespective of whether they have completed the works pre-GST or post-GST or payments were received or yet to be received post-GST.
(iv) If such representations are submitted, the respective employers/Respondents are directed to consider and dispose of the same in the light of the aforesaid directions/guidelines as expeditiously as possible and at any rate within a period of 8 weeks from the date of submission of the representations.
(v) In view of the interim orders passed by this Court in the present petitions, such of the petitioners who had not filed their GST returns during the period after 1-72017 are permitted to file their returns/amended returns, pursuant to the calculation of the differential tax as per procedure above under GST regime, without insisting on interest or penalty or limitation.
(vi) The GST authorities are also directed not to take precipitative action against the Petitioners for a period of 6 months from the date of receipt of a copy of this order.
(vii) Liberty is reserved in favour of the petitioners to challenge any order/decision passed/taken by the respondents or the authorities, subsequent to this order and also take recourse to such remedies as available in law.”
4. It is further jointly submitted that the judgment of the Co-ordinate Bench of the Court in the case of Chandrasekharaiah (supra) was the subject matter of challenge before the Division Bench of this Court in the case of Office of Principal Commissioner GST and Central Excise v. R. Chandrashekar 116 GST 656 (Karnataka)/Judgment dated 10.06.2026 in W.P.No.1587/2023 C/w W.A.No.1599/ 2023, W.A.No.1638/2023, W.A.No.1647/2023 & W.A.No.25/2024 : NC:2026 KHC:28975-DB. The Division Bench has partly allowed the said appeals. The operative portion of the order of the Division Bench is as under:
“8 . The dispute as to whether the writ petitioners would be entitled to reimbursement of the incremental tax paid or payable by them on account of the levy of GST is strictly a matter between the writ petitioners and the Employers with whom they had entered into the contracts. The contracts between the writ petitioners and the Employers would not alter the statutory scheme for the levy of GST. Thus, the liability of the writ petitioners to pay Goods and Services Tax (whether under the Central Goods and Services Tax Act, 2017, the State Goods and Services Tax Act, 2017 or the Integrated Goods and Services Tax Act, 2017) is required to be determined strictly in accordance with the provisions of the relevant statute. The question of the levy of GST, assessment, recovery, and enforcement is a matter of statutory prescription.
9. In view of the above, no directions could be issued permitting the filing of any revised returns contrary to the provisions of the statute. The plenary directions to waive the penalty, interest under the GST Acts or the limitation for filing returns/revised returns are also unsustainable.
10. The controversy as to the incremental tax burden arising on account of the change in the tax regime is, in essence, one between the writ petitioners and the Employers. In the context of such a dispute, no directions could be issued to the tax authorities regarding the levy, assessment, and collection of tax, penalty, or interest.
11. In the aforesaid view, the direction issued to the respondents to reimburse the differential tax is required to be construed as a direction only to the concerned Employers and not to the tax authorities.
12. Accordingly, the impugned order, to the extent it issues directions to the tax authorities, is set aside. The appeal is disposed of in the aforesaid terms.”
5. In view of the judgment of the Division Bench, as referred above, the operative direction Nos.(v) and (vi) as ordered in case of Chandrashekharaiah (supra) have been set aside.
6. In view of the aforementioned, the present writ petitions are allowed in terms of the operative direction Nos.(i), (ii)(a) to (ii)(f), (iii), (iv) and (vii) as held in the case of Chandrashekharaiah1 as noted above.
7. Since the petitioner has also impugned the assessment orders in the present writ petitions, the petitioner is at liberty to assail the same in appropriate proceedings. The concerned authorities shall not take into account time period spent by the petitioner in prosecuting the present petitions.
8. In view of disposal of the writ petitions, pending interlocutory applications, if any, do not survive for consideration and are disposed of.
]]> Court condones delay to allow appeal on disputed reverse charge tax liability and SCN quantification discrepancies. https://www.taxheal.com/c-m-poonacha-j-2.html Wed, 15 Jul 2026 07:39:37 +0000 https://www.taxheal.com/?p=136129 Court condones delay to allow appeal on disputed reverse charge tax liability and SCN quantification discrepancies. Issue Whether a small security services provider should be allowed to file a late statutory appeal under Section 107 of the CGST Act when they missed the deadline due to lack of professional advice and the assessment orders involve… Read More »

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Court condones delay to allow appeal on disputed reverse charge tax liability and SCN quantification discrepancies.

Issue

Whether a small security services provider should be allowed to file a late statutory appeal under Section 107 of the CGST Act when they missed the deadline due to lack of professional advice and the assessment orders involve disputed reverse charge mechanism (RCM) liabilities and discrepancy in the tax amount between the SCN and the final order.

Facts

  • The petitioner is a small operator engaged in the business of supplying security services.

  • The tax department issued Show Cause Notices (SCNs) to the petitioner for the tax periods FY 2021-22 and FY 2022-23.

  • Due to non-appearance, ex parte adjudication orders were passed against the petitioner confirming the demand for tax, interest, and penalties.

  • The petitioner failed to file statutory appeals within the prescribed limitation period and approached the High Court for relief.

  • The petitioner explained that the delay occurred because they lacked professional advice and could not access the GST portal to view the notices in time.

  • On the merits of the case, the petitioner contended that the tax liability fell on the service recipient under the Reverse Charge Mechanism (RCM) rather than on them.

  • The petitioner further pointed out that the tax amount quantified in the final assessment orders differed from the amount originally proposed in the SCNs, violating the statutory framework.

Decision

  • Held, that earlier judicial orders in similar situations have permitted the filing of appeals under peculiar facts to prevent injustice.

  • Held, that because the dispute involves key legal and factual issues—specifically the applicability of the reverse charge mechanism and the discrepancy in demand quantification between the SCN and the final order—it is highly expedient to have these issues properly adjudicated on facts.

  • Held, that the petitioner is permitted to file and pursue their statutory appeals under Section 107 of the Act despite the delay, and the petition is allowed in favor of the assessee.

Key Takeaways

  • Condonation of Delay for Meritorious Disputes: High Courts may exercise extraordinary jurisdiction to condone delay and permit a late appeal if the case raises strong, unresolved legal and factual defenses, such as a clear RCM exemption.

  • Demand Cannot Exceed SCN Proposals: The tax department cannot confirm a final demand in an assessment order that differs from or exceeds the amount proposed in the initial Show Cause Notice, as doing so violates the fundamental statutory scheme.

HIGH COURT OF KARNATAKA
Aditya Security Force
v.
Assistant Commissioner of Commercial Taxes (AUDIT 2)*
C.M. Poonacha, J.
WRIT PETITION NO. 105019 OF 2026 (T-RES)
JUNE  22, 2026
M.N. Shankare Gowda, Adv. for the Petitioner. H.R. Kambiyavar, Adv. and Smt. Nandini Somapur, AGA for the Respondent.
ORDER
1. The present writ petition is filed seeking for the following reliefs:
“This Hon’ble’ High Court may be pleased to issue a Writ of Certiorari or a direction in the nature of Writ of certiorari quashing the ex parte impugned Orders both dated 21.05.2025 in Nos. ACCT(Audit)-2/HPT/GST-ADJN/Order-/2025-26/T and ACCT(Audit)-2/HPT/GST-ADJN/Order-/2025-26/T for the tax periods 2021-22 & 2022-23 passed by the 1st Respondent (Annexure- C & D) in the Petitioner’s case.
This Hon’ble’ High Court may be pleased to issue a Writ of Certiorari or a direction in the nature of Writ of certiorari quashing the Show Cause Notices in Form GST DRC-01 both dated 08.04.2024 in Nos. CTO/ENF/HPT/U/S73/15/2024-25/7775 & CTO/ENF/HPT/U/S73/16/2024-25/7776 issued by the 2nd Respondent for the tax periods 2021-22 & 2022-23 (Annexure – A & A1) in the Petitioner’s Case.
This Hon’ble’ High may be pleased to issue such other Writ or Writs or Directions in the nature of a Writ as this Hon’ble’ High Court may deem with fit to grant in the facts and circumstances of the Petitioner’s case. “
2. It is the case of the petitioner that consequent to the show cause notices dated 08.04.2024, issued for the tax period April- 2021 to March-2022 as also April- 2022 to March-2023 (Annexures-A and A1 respectively), the petitioner was unable to appear to contest the same; as a result of which, order of adjudication under Section 73(9) of the Goods and Services Act, 20171 was passed with respect to the said period i.e., April-2021 to March-2022 and April-2022 to March-2023 vide Annexures-C and D, respectively.
3. It is further contended that the amount of total tax, interest and penalty mentioned in the notices and in the orders are different, which are contrary to Section 73(7) of the Act. Reliance is placed on a Co-ordinate Bench of this Court in the case of Prestige Nottinghill Investments v. Union of India [2025] 180 taxmann.com 155 (Karnataka)/2026 (114) KGST L.J. 424 (HC).
4. It is further submitted that the petitioner, being a small operator of supplying security services, was not updated with the operations of the systems and hence, was not in a position to open the portal and attend to the notices. That, the petitioner had no proper advice with respect to the tax that was leviable. In the said context, it is submitted that having regard to the notification dated 28.06.2017 (Annexure-S to the writ petition), which has been modified vide notification dated 31.12.2017 (Annexure-T to the writ petition), the tax leviable under the provisions of the Act were to be paid on reverse charge basis by the recipient of the service. That the business of the petitioner is covered under the notification dated 31.12.2018. The respondent No.1-Assistant Commissioner while noticing that the petitioner had provided security services, levied tax on the petitioner, who had provided the services and was not the recipient of the services.
5. Learned AGA submits that the orders dated 21.05.2025 passed under Section 73(9) of the Act are appealable under Section 107(4) of the Act. However, learned counsel for the petitioner submits that the time period contemplated for filing of the appeal having expired, relying on the judgment of a Division Bench of this Court in the case of Yallappa R. Patil v. Assisstant CCTes [2026] 187 taxmann.com 1018 (Karnataka) Order dated 25.09.2025 in W.A.No. 100608/2025 : NC: 2025:KHC-D:13250-DB as well as a Co-ordinate Bench of this court in the case of JJai Hind Enterprises v. Asstt. CCTes [2026] 187 taxmann.com 1017 (Karnataka) Order dated 21.01.2025 in W.P.No. 107549/2024 : NC: 2025:KHC-D:1034 an opportunity be afforded to the petitioner to avail the remedy of appeal as provided under the Act.
6. It is noticed that this Court on earlier occasions, as cited by the learned counsel for the petitioner, having regard to the peculiar facts and circumstances of the said cases, has permitted the availment of the appellate remedy while also noticing that the said orders were not to be treated as a precedent.
7. In the peculiar facts of the present case, since the petitioner did not avail the remedy of filing an appeal and having regard to the fact that the levy of tax on the petitioner itself is sought to be impugned on the ground that the tax was to be paid on reverse charge basis by the recipient of the services, which aspect requires a factual adjudication of the matter as well as the contention of the petitioner that the impugned orders are contrary to Section 73(7) of the Act, it is expedient that the petitioner be permitted to avail the appeal remedy in a recipient of services. However, it is expedient that the petitioner be permitted to avail the appeal within a period of three weeks from date. Accordingly, the present writ petition is disposed of by permitting the petitioner to avail the appeal remedy.
8. If such a remedy is availed within three weeks from date, the said appeal shall be considered by the appellate authority without raising any objection on limitation.
9. It is made clear that this order is passed having regard to the peculiar factual matrix of the present case and may not be treated as a precedent.
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