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2025 DIGILAW 1969 (KAR)

Subhash v. Principal Commissioner Of Central Tax

2025-12-18

S.R.KRISHNA KUMAR

body2025
ORDER : S.R.KRISHNA KUMAR, J. 1. In these petitions, the petitioner seeks the following reliefs: In W.P No.29461/2024 “a) Issue a Writ of Mandamus or any other appropriate Writ Order or direction under Article 226 of the Constitution of India quashing the and setting aside the Order dated 23.07.2024 Annexure – B issued by Respondent No.3 for cancellation of Registration. b) Issue a Writ of Mandamus or any other appropriate Writ Order or direction under Article 226 of the Constitution of India quashing the and setting aside the Order dated 10.07.2024 issued by Respondent No.2 Blocking of ITC. c) Issue a Writ of Mandamus or any other appropriate Writ Order or direction under Article 226 of the Constitution of India quashing the and setting aside the Orders dated 28.08.2024 and dated 29.08.2024 Annexures – G to J issued by Respondent No.1 provisionally attaching the Bank Accounts. d) Issue a Writ of Mandamus or any other appropriate Writ Order or direction under Article 226 of the Constitution of India directing the Respondents not to levy interest, penalty and late fee for delayed filing of returns and delayed payment of GST. e) Pass such other order or direction as deemed fit and proper by this Hon'ble Court in the facts and circumstances of the case.” In W.P No.28950/2024 “a) Issue a Writ of Mandamus or any other appropriate Writ Order or direction under Article 226 of the Constitution of India quashing the and setting aside the Order ZA290724095765S dated 23.07.2024 Annexure – C issued by Respondent No.3 for cancellation of Registration. b) Issue a Writ of certiorari or any other appropriate Writ Order or direction under Article 226 of the Constitution of India quashing the and setting aside the Order dated 10.07.2024 Annexure ‘F’ issued by Respondent No.3 Blocking of ITC. c) Issue a Writ of certiorari or any other appropriate Writ Order or direction under Article 226 of the Constitution of India quashing the and setting aside the Orders both GEXCOM/AE/INV/GST/4236/2024-AE-O/o Pr COMMR- CGST-Mysuru Annexure G and Annexure H dated 29.08.2024 issued by Respondent No.1 provisionally attaching the Bank Accounts. d) Issue a Writ of Mandamus or any other appropriate Writ Order or direction under Article 226 of the Constitution of India directing the Respondents not to levy interest, penalty and late fee for delayed filing of returns and delayed payment of GST. d) Issue a Writ of Mandamus or any other appropriate Writ Order or direction under Article 226 of the Constitution of India directing the Respondents not to levy interest, penalty and late fee for delayed filing of returns and delayed payment of GST. e) Pass such other order or direction as deemed fit and proper by this Hon'ble Court in the facts and circumstances of the case.” In W.P No.29143/2024 “a) Issue a Writ of Mandamus or any other appropriate Writ Order or direction under Article 226 of the Constitution of India quashing the and setting aside the Order ZA290824058679O dated 14.08.2024 Annexure – B issued by Respondent No.2 for cancellation of Registration. b) Issue a Writ of certiorari or any other appropriate Writ Order or direction under Article 226 of the Constitution of India quashing the and setting aside the Orders dated 29.08.2024 and 28.08.2024 issued by Respondent No.1 provisionally attaching the Bank Accounts. c) Issue a Writ of Mandamus or any other appropriate Writ Order or direction under Article 226 of the Constitution of India directing the Respondents not to levy interest, penalty and late fee for delayed filing of returns and delayed payment of GST. d) Pass such other order or direction as deemed fit and proper by this Hon'ble Court in the facts and circumstances of the case.” In W.P No.29860/2024 “a) Issue a Writ of Mandamus or any other appropriate Writ Order or direction under Article 226 of the Constitution of India quashing the and setting aside the Order dated 17.08.2024 Annexure – C issued by Respondent No.3 for cancellation of Registration. b) Issue a Writ of Mandamus or any other appropriate Writ Order or direction under Article 226 of the Constitution of India quashing the and setting aside the Order dated 20.08.2024 Annexure - F issued by Respondent No.2 Blocking of ITC. c) Issue a Writ of Mandamus or any other appropriate Writ Order or direction under Article 226 of the Constitution of India quashing the and setting aside the Orders dated 28.08.2024 Annexure – G issued by Respondent No.1 provisionally attaching the Bank Accounts. d) Issue a Writ of Mandamus or any other appropriate Writ Order or direction under Article 226 of the Constitution of India directing the Respondents not to levy interest, penalty and late fee for delayed filing of returns and delayed payment of GST. d) Issue a Writ of Mandamus or any other appropriate Writ Order or direction under Article 226 of the Constitution of India directing the Respondents not to levy interest, penalty and late fee for delayed filing of returns and delayed payment of GST. e) Pass such other order or direction as deemed fit and proper by this Hon'ble Court in the facts and circumstances of the case.” 2. Heard learned counsel for the petitioners and learned counsel for the respondents. Perused the material on record. 3. On perusal of the material on records would indicate that the respondents passed the impugned orders dated 23.07.2024 at Annexure - B and order dated 20.08.2024 at Annexure - E in W.P No.29461/2024, order dated 23.07.2024 at Annexure - C in W.P No.28950/2024, order dated 14.08.2024 at Annexure - B and order dated 06.09.2024 at Annexure - E in W.P No.29143/2024 and order dated 17.08.2024 at Annexures - C and D in W.P No.29860/2024, cancelling the GST registration of the petitioner, who has assailed the same in the present petitions. 4. Under identical circumstances, this Court by the order dated10.10.2025 in the case of ' Mahesh Gurappa Doddamane Vs. The Assistant Commissioner of Commercial Taxes and Another passed in W.P No.27764/2025 , wherein it is held as under: "In this petition, the petitioner seeks the following reliefs: “a) Issue a writ of certiorari or a writ in the nature of certiorari quashing the show cause notice in Form GST REG-17/31 in Reference No.ZA2906240399715 dated 11.06.2024 as it is contrary to the provisions of CGST Rules 2017 and KGST Rules, 2017 at Annexure-A. b) Issue a writ of certiorari or a writ in the nature of certiorari quashing the order for cancellation of Registration in Reference No.ZA2907241084876 dated 26.07.2024 as being contrary to the provisions of CGST Act, 2017 and KGST Act, 2017 at Annexure-B. c) Issue a writ of certiorari or a writ in the nature of certiorari declaring that the cancellation of registration of the petitioner is illegal and that the petitioner would be entitled to adjust the accumulated input tax credit during the period of cancellation against its output tax liability; and d) and grant such other relief or reliefs as this Hon'ble Court may deem fit in the circumstances of the case, in the interest of justice." 2. Heard learned counsel for the petitioner and learned counsel for the respondents and perused the material on record. 3. In addition to reiterating the various contentions urged in the petition and referring to the material on record, learned counsel for the petitioner submits that the respondent No.2 issued a show- cause notice dated 26.07.2024. However, due to bonafide reasons, unavoidable circumstances and sufficient cause, the petitioner was not in a position to appear before --respondent No.2 for the purpose of attending personal hearings, consequently the respondent No.2 proceeded to pass the impugned order dated 26.07.2024, canceling the GST registration of the petitioner. Aggrieved by the impugned order, the petitioner is before this Court by way of the present petition. 4. Heard learned counsel for the petitioner and learned counsel for the respondents and perused the material on record. 5. In the light of the specific assertion on the part of the petitioner that his inability and omission to reply to the show-cause notice and to attend on the date of hearing before respondent No.2 was due to bonafide reasons, unavoidable circumstances and sufficient cause, by adopting a justice oriented approach, I deem it just and appropriate to set aside the impugned order and remit the matter back to the concerned respondents in order to provide one more opportunity to the petitioner. 6. Learned counsel for the petitioner submits that if the impugned order of cancellation is set aside, the petitioner would file the returns and also pay up to date taxes. 7. The aforesaid submission of learned counsel for the petitioner is placed on record. 8. In the result, I pass the following: ORDER i. The Petition is allowed ii. The impugned order at Annexure-B dated 26.07.2024 passed by respondent No.2, is hereby quashed. iii. The concerned respondents are directed to reinstate/restore the GST registration of the petitioner within four weeks from today, subject to the petitioner filing GST returns and paying up to date tax together with applicable penalty and interest, within the aforesaid period of four weeks from the date of receipt of a copy of this order. iv. It is needless to state that this order is made in the peculiar/special facts and circumstances obtaining in the instant case and this order cannot be treated as a precedent nor shall have any precedential value for any other purpose, whatsoever." 5. iv. It is needless to state that this order is made in the peculiar/special facts and circumstances obtaining in the instant case and this order cannot be treated as a precedent nor shall have any precedential value for any other purpose, whatsoever." 5. In view of the aforesaid facts and circumstances and the judgment of this Court in WP No.27764/2025, I am of the view that the GST registration of the petitioner deserves to be restored by quashing the impugned order, subject to the petitioner filing returns and paying upto date taxes, penalty and interest within a period of four weeks from the date of receipt of a copy of this order. 6. By way of prayer No.(b), the petitioner has sought for quashing of the impugned order dated 10.07.2024 under which the electronic credit ledger of the petitioner was blocked by the respondents. In this context, it is pertinent to refer to Rule No.86A of the Central Goods and Services Tax Rules, 2017 (for short ‘the CGST Rules’), which reads as under: “ Rule 86A. Conditions of use of amount available in electronic credit ledger .- (1) The Commissioner or an officer authorised by him in this behalf, not below the rank of an Assistant Commissioner, having reasons to believe that credit of input tax available in the electronic credit ledger has been fraudulently availed or is ineligible in as much as- (a) the credit of input tax has been availed on the strength of tax invoices or debit notes or any other document prescribed under rule 36- i. issued by a registered person who has been found non-existent or not to be conducting any business from any place for which registration has been obtained; or ii. without receipt of goods or services or both; or b) the credit of input tax has been availed on the strength of tax invoices or debit notes or any other document prescribed under rule 36 in respect of any supply, the tax charged in respect of which has not been paid to the Government; or c) the registered person availing the credit of input tax has been found non-existent or not to be conducting any business from any place for which registration has been obtained; or d) the registered person availing any credit of input tax is not in possession of a tax invoice or debit note or any other document prescribed under rule 36, may, for reasons to be recorded in writing, not allow debit of an amount equivalent to such credit in electronic credit ledger for discharge of any liability under section 49 or for claim of any refund of any unutilised amount. (2)The Commissioner, or the officer authorised by him under sub-rule (1) may, upon being satisfied that conditions for disallowing debit of electronic credit ledger as above, no longer exist, allow such debit. (3) Such restriction shall cease to have effect after the expiry of a period of one year from the date of imposing such restriction. 7. As it is clear from the aforesaid provision, the said blocking of the input tax credit available in the electronic credit ledger of the petitioner would remain valid only for a period of one year and the same having not been extended by the respondent, coupled to the fact that the period of one year stood expired on 09.07.2025 itself, the said blocking would not subsist any longer and the impugned order would not exist any longer and the same deserves to be quashed. 8. Insofar as the challenge to the impugned provisional attachment order dated 28.08.2024 and 29.08.2024 vide Annexures - G, H and J issued by respondent No.1 under Section 83 of the CGST Act is concerned, sub section 2 of Section 83 contemplates that even the said provisional attachment would remain valid only for a period of one year from the date on which the order was made. 9. It is therefore clear that the period of one year having expired as on today, the impugned order provisionally attaching the bank account of the petitioner also deserves to be quashed. 10. 9. It is therefore clear that the period of one year having expired as on today, the impugned order provisionally attaching the bank account of the petitioner also deserves to be quashed. 10. In the result, I pass the following: ORDER i) Writ Petitions are hereby allowed. ii) The Impugned order dated 23.07.2024 at Annexure B and order dated 20.08.2024 at Annexure - E in W.P No.29461/2024, order dated 23.07.2024 at Annexure - C in WP No.28950/2024, order dated 14.08.2024 at Annexure – B and order dated 06.09.2024 at Annexure - E in W.P No.29143/2024 and order dated 17.08.2024 at Annexure – C and order dated 17.08.2024 at Annexure - D in W.P No.29860/2024, are set aside. iii) The impugned orders dated 28.08.2024 and 29.08.2024 vide Annexures – G, H and J in W.P No.29461/2024, Annexures G and H in W.P No.28950/2024, Annexures F and G in W.P No.29143/2024 and Annexure – G in W.P No.29860/2024 are hereby quashed. iv) The concerned respondents are directed to reinstate/restore the GST registration of the petitioner within four weeks from today, subject to the petitioner filing GST returns and paying up to date tax together with applicable penalty and interest, within the aforesaid period of four weeks from the date of receipt of a copy of this order. v) It is needless to state that this order is made in the peculiar/special facts and circumstances obtaining in the instant case and this order cannot be treated as a precedent nor shall have any precedential value for any other purpose, whatsoever.