M/S Lotus Construction Corporation v. Assistant Commissioner of Central Tax

NC:(2026:KHC:35638( WP(No.(19868(of(2026( ( , ,,HC-KAR( ( ( INATHEAHIGHACOURTAOFAKARNATAKAAATABENGALURUA

THDATEDATHISATHEA14 ADAYAOFAJULY,A2026A

BEFOREA

THEAHON'BLEAMR.AJUSTICEABAMASHYAMAPRASADA

WRITAPETITIONANO.A19868AOFA2026A(T-RES)A A BETWEEN:AA A

M/S-LOTUS-CONSTRUCTION--CORPORATION-NEAR-WATER-TANK,--

MIG-448-INDEPENDENT-HOUSE,--SURYANAGAR-PHASE-I,--KHB-COLONY,-ANEKAL-TALUK,--CHANDAPURA,--BENGALURU--560099--PRESENTLY-AT:-HCB-1,--FLAT-NO.201,-HIGH-RISE--

APARTMENTS,--Digitally SURYANAGAR-PHASE-I,--signedtiby KHB-COLONY,-ANEKAL-TALUK,--VANAMALA0N CHANDAPURA,-BENGALURU--560099-Location: A-PARTNERSHIP-FIRM,--HIGH0COURT UNDER-PARTNERSHIP-ACT-1932-OF KARNATAKA REPRESENTED-BY-ITS-PARTNER,--SRI.-VENKATA-RAO-ADUSUMILLI-…PETITIONER-(BY-SMT.-VEENA-J-KAMATH,-ADVOCATE)-AND:A A ASSISTANT-COMMISSIONER--OF-CENTRAL-TAX-SOUTH-DIVISION-9,--NC:(2026:KHC:35638( WP(No.(19868(of(2026( ( , ,,HC-KAR( ( ( TH7 -FLOOR,-C-WING,--KENDRIYA-SADAN,--KORAMANGALA,--BENGALURU-560034-…RESPONDENT-(BY-SRI.-JEEVAN-J.-NEERALGI,-ADVOCATE)---THIS-WP-IS-FILED-UNDER-ARTICLE-226-OF-THE-CONSTITUTION-OF-INDIA-PRAYING-TO-QUASH/SET-ASIDE-THE-IMPUGNED-ORDER-IN-ORIGINAL-DATED-IN-FORM-DRC-07-DATED-25.11.2024-PASSED-BY-THE-RESPONDENT-IN-ORDER-SL.-NO.-205/2024-25-SD9-GST-AC-FOR-THE-CONSOLIDATED-PERIODS-FROM-2017-2018-TO-2019-20-UNDER-THE-PROVISIONS-OF-SECTION-74(1)-OF-THE-GST-ACT-AS-PER-ANNEXURE-A,-BY-ISSUING-A-WRIT-OF-CERTIORARI-OR-ANY-OTHER-ORDER-OR-WRIT-IN-THE-NATURE-OF-A-WRIT-OF-CERTIORARI.--THIS-PETITION,-COMING-ON-FOR-PRELIMINARY-HEARING,-THIS-DAY,-ORDER-WAS-MADE-THEREIN-AS-UNDER:--CORAM:-HON'BLE-MR.-JUSTICE-B-M-SHYAM-PRASAD---

ORAL ORDER

The petitioner's grievance is with the Order-in-Original dated 25.11.2024 [Annexure-A] which is under Section 74 of the Central Goods and Services Tax Act/State Goods and Services Act, 2017 [for short, the Acts']. This Adjudication Order is for the tax periods 2017-18 and 2019-20. The petitioner has responded to the show cause notice, and the Petitioner's response has been considered in passing the Adjudication Order.

Ms. Veena J Kamath, the learned counsel for the petitioner, while inviting this Court's attention to the provisions of Section 75[4] and [5] of the Act, submits that the petitioner's representative had requested for a personal hearing to explain the reconciliation that could justify the Reply filed to the show cause notice, but could not participate because the Managing Partner's wife was diagnosed as suffering from terminal illness and she has died subsequently

because of such terminal illness. Section 75[4] and [5] read as under. "75. General provisions relating to determination of tax.-

(1) xxx xxx xxx xxx

(2) xxx xxx xxx xxx

(3) xxx xxx xxx xxx

(4) An opportunity of hearing shall be granted where a request is received in writing from the person chargeable with tax or penalty, or where any adverse decision is contemplated against such person.

(5) The proper officer shall, if sufficient cause is shown by the person chargeable with tax, grant time to the said person and adjourn the hearing for reasons to be recorded in writing.

Provided that no such adjournment shall be granted for more than three times to a person during the proceedings."

Sri Jeevan J Neeralgi, a learned standing counsel for the respondent who is called upon to accept notice for the respondent, is heard, and this Court is of the view that for the reasons asserted, the petitioner must

be extended the benefit of a personal hearing before there is a final decision because, if a request was made by the petitioner, there could have been adjournments on three occasions. As such, the following order observing that this Court has not examined the merits of the petitioner's case on a possible reconciliation. ORDER The petition is allowed and the Adjudication Order dated 25.11.2024 [Annexure-A] is quashed subject to the following terms. [a] The proceedings are restored to the respondent for due consideration subject to the petitioner depositing 10% of the tax in demand by 31.08.2026 subject to the outcome in the restored proceedings. [b] The petitioner is permitted to file, along with a certified copy of this Order, the copies of the documents to show the genuineness of the transactions along with the reconciliation.

[d] The petitioner shall produce these documents by 31.08.2026, and the respondent shall consider these documents and then conclude the proceedings by a reasoned order.

Sd/- (B M SHYAM PRASAD) JUDGE

AN/-