- 1 - HC-KAR NC: 2025:KHC:47743 WP No. 34573 of 2025 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 18TH DAY OF NOVEMBER, 2025 BEFORE THE HON'BLE MR. JUSTICE S.R.KRISHNA KUMAR WRIT PETITION NO. 34573 OF 2025 (T-RES) BETWEEN: MR RAJIS AGED ABOUT 46 YEARS, PROPRIETOR OF M/S ATLAS BOARDS AND PLYWOODS, 1-277, KAMMADI SAW MILLS FACTORY BUILDING, ARYAPU VILLAGE, PUTTUR, DAKSHINA KANNADA 574 210. …PETITIONER (BY SRI. SYED JAFFER MOHIYUDDIN, ADVOCATE) AND: THE ASSISTANT COMMISSIONER COMMERCIAL TAX, LGSTO-265, DARBE, PUTTUR. …RESPONDENT (BY SRI. K. HEMA KUMAR, AGA) THIS W.P IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO SET ASIDE THE IMPUGNED NOTICE UNDER SECTION 74 READ WITH SECTION 50, 74(9) OF THE KGST ACT/CGST ACT, 2017 AND SECTION 20 OF THE IGST ACT, 2017 BEARING NO. ACCT/LGSTO 265/PTR/DRC-07/05/2025-26 DATED 05.07.2025 INFORMING THAT THE PETITIONER HAD AVAILED INPUT TAX CREDIT (GSTIN FROM M/S NATIONAL INDUSTRIES 29OFVPS2063M1Z4). COPY OF NOTICE PRODUCED AT ANNEXURE-A. AND DIRECT RESPONDENT TO ALLOW THE PETITIONER TO CLAIM INPUT TAX CREDIT FROM M/S NATIONAL INDUSTRIES (GSTIN 29OFVPS2063M1Z4) FOR THE INVOICE DATED 05.07.2025. THIS PETITION, COMING ON FOR PRELIMINARY HEARING, THIS DAY, ORDER WAS MADE THEREIN AS UNDER: Digitally signed by MADHURI S Location: High Court of Karnataka - 2 - HC-KAR NC: 2025:KHC:47743 WP No. 34573 of 2025 CORAM: HON'BLE MR. JUSTICE S.R.KRISHNA KUMAR ORAL ORDER In this petition, petitioner seeks the following reliefs: “ (i) Set aside the impugned notice under Section 74 Read with Section 50, 74(9) of the KGST ACT/CGST/ACT, 2017 and Section 20 of the IGST Act, 2017 bearing No.ACCT/LGSTO-265/PTR/DRC-07/05/2025-26 dated: 05.07.2025 informing that the petitioner had availed input tax credit from M/s. National Industries (GSTIN:290FVPS2063M1Z4). Copy of Notice produced at Annexure-A. and direct Respondent to allow the petitioner to claim input tax credit from M/s. National Industries (GSTIN:290FVPS2063M1Z4) for the invoice dated:05.07.2025. (ii) And to pass any other orders that this Hon’ble Court deems fit in the present facts and circumstances of this case in the interest of justice.” 2. Heard learned counsel for the petitioner and learned AGA for the respondent and perused the material on record. 3. A perusal of the material on record will indicate that pursuant to the Show Cause Notice dated 23.05.2025 issued by the respondent to the petitioner under Section 74 of the KGST Act, the petitioner submitted a reply and proceedings culminated in the - 3 - HC-KAR NC: 2025:KHC:47743 WP No. 34573 of 2025 impugned order at Annexure – A dated 05.07.2025 confirming the demand made in the Show Cause Notice. Subsequently, since the petitioner did not comply with the demand, the respondents have proceeded to recover a sum of Rs.6 lakhs from the account of the petitioner by attaching the same. 4. Learned counsel for the petitioner submits that petition may be disposed of by reserving liberty in favour of the petitioner to prefer an appeal before the Appellate Authority within the stipulated time frame and by treating the amount already recovered as pre- deposit for the purpose of filing an appeal before the Appellate Authority and by excluding the period spent before this Court under Section 14 of the Limitation Act. 5. The said submission is placed on record. 6. In view of the aforesaid facts and circumstances and the submissions made on behalf of the petitioner, I deem it just and appropriate to dispose of this petition by reserving liberty in favour of the petitioner to file an appeal before the Appellate Authority. If such an appeal is filed by the petitioner within a period of four weeks from the date of receipt of a copy of this order, the Appellate - 4 - HC-KAR NC: 2025:KHC:47743 WP No. 34573 of 2025 Authority shall treat the amount already recovered from the petitioner by the respondent as pre-deposit for the purpose of the appeal and the Appellate Authority is directed to dispose of the appeal on merits without insisting on further pre-deposit. In addition thereto, if petitioner files such an appeal before the Appellate Authority within a period of four weeks from the date of receipt of a copy of this order, the petitioner shall have the benefit of exclusion of time under Section 14 of the Limitation Act. 7. Since the respondents have already recovered a sum of Rs.6 lakhs, which is in excess of 10% pre-deposit for the purpose of filing an appeal before the Appellate Authority, the respondents shall defreeze the account of the petitioner and refund the entire amount in excess of 10% of the total demand raised immediately upon receipt of a copy of this order. The amount already recovered by the respondent would be subject to the final out come of the appeal before the Appellate Authority. The appellant is permitted to file an appeal before the Appellate Authority both physically and electronically. - 5 - HC-KAR NC: 2025:KHC:47743 WP No. 34573 of 2025 8. Subject to the aforesaid observations and directions, the petition stands disposed of. Sd/- (S.R.KRISHNA KUMAR) JUDGE SV List No.: 2 Sl No.: 14