- 1 - HC-KAR NC: 2026:KHC:22360 WP No. 10689 of 2026 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 23RD DAY OF APRIL, 2026 BEFORE THE HON'BLE MR. JUSTICE S SUNIL DUTT YADAV WRIT PETITION NO. 10689 OF 2026 (T-RES) BETWEEN: 1. M/S M PRABHUSHANKAR NO. 189/3, OUT HOUSE, 3RD MAIN ROAD, 6TH CROSS, CHAMRAJPET, BENGALURU - 560 018. (REPRESENTED BY ITS PROPRIETOR SHRI. M. PRABHUSHANKAR) … PETITIONER (BY SRI. ATUL K ALUR., ADVOCATE) AND: 1. UNION OF INDIA THROUGH ITS SECRETARY, (REVENUE) MINISTRY OF FINANCE, DEPARTMENT OF REVENUE, GOVERNMENT OF INDIA, NORTH BLOCK, NEW DELHI - 110 001. 2. THE ASSISTANT COMMISSIONER OF GST BENGALURU WEST DIVISION-1, BENGALURU WEST COMMISSIONERATE 1ST FLOOR, BMTC BUS COMPLEX, Digitally signed by PRAKASH N Location: HIGH COURT OF KARNATAKA - 2 - HC-KAR NC: 2026:KHC:22360 WP No. 10689 of 2026 KANAKAPURA ROAD, BANASHANKARI, BENGALURU - 560 070. … RESPONDENTS (BY SRI. ARAVIND V. CHAVAN., ADVOCATE) THIS W.P. IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA, PRAYING TO A) QUASH THE IMPUGNED ORDER-IN-ORIGINAL VIDE ORDER NO. OIO NO. 84/2023-24 DATED 31/01/2024 MARKED AT ANNEXURE-E ISSUED BY RESP-2 FOR THE PERIOD APRIL 2015 TO JUNE 2017 INSOFAR AS THE PETITIONER IS CONCERNED AND ETC. THIS PETITION COMING ON FOR PRELIMINARY HEARING, THIS DAY, ORDER WAS MADE THEREIN AS UNDER: CORAM: HON'BLE MR. JUSTICE S SUNIL DUTT YADAV ORAL ORDER The petitioner has challenged the order-in-original at Annexure-E, whereby the parties have initiated proceedings for adjudication under the provisions of the Finance Act, 1974 and raised demand for Service Tax. 2. It is the contention of the petitioner that adjudication is completed on the basis of reports received from the Central Board of Direct Taxes and taking note of declaration made in the Income Tax returns. - 3 - HC-KAR NC: 2026:KHC:22360 WP No. 10689 of 2026 3. It is further submitted that the petitioner's service rental fall within the purview of the 'Negative List of Services' as per Section 66D of the Finance Act in terms of Notification No.19/2012-ST dated 05.06.2012. 4. It is further submitted that the proceedings have culminated in exparte order and the petitioner due to bonafide lapses, was not in a position to submit the reply. It is submitted that, if opportunity is granted, petitioner would make out reply. Reliance is also made on the observations made in W.P.No.11154/2023 and connected petitions. and it is contended that this court in identical circumstances had set aside the order-in-original and remitted the matter for fresh consideration after observing that the authorities were to take note of the observations made therein. 5. Perused the order dated 03.07.2024 passed in W.P.No.11154/2023 and connected petitions. - 4 - HC-KAR NC: 2026:KHC:22360 WP No. 10689 of 2026 6. This Court while disposing of the said petitions by remanding it to the stage of reply to the show cause notice had made certain observations to be kept in mind by the concerned officials. The observations made from para-10 onwards reads as follows:- 10. The officers while disposing off the petitions to keep in mind the following: 1) Whether petitioners do not qualify under Section 65B(44) of the Finance Act, 1994 ? 2) Whether services are covered under negative list ? 3) Whether services are covered under the exemption list under the Notification No.25/2012-ST dated 28.06.2012 or under any other applicable Notifications? 4) Whether the person is liable to remit service tax in terms of Rule 2 (1) (d) read with applicable notification? 5) Whether claims are barred by limitation in terms of the law laid down by the Apex Court? 11. It is also clarified that disposal of present petitions must not be construed as having adjudicated any of the contentions including - 5 - HC-KAR NC: 2026:KHC:22360 WP No. 10689 of 2026 jurisdiction. All contentions of both sides on merits are kept open. 12. Needless to state, upon conclusion of proceedings, if any of the petitioners are still aggrieved, legal remedies are kept open. It is also clarified that wherever, replies to show-cause notice have not been made out, the same may be filed upon matter being relegated as noticed above. 13. Accordingly, the following: ORDER In light of observations made above, the writ petitions relating to challenge to show-cause notice, such matters will stand relegated to the officers to be designated in terms of the observations made in para 8 above, at the same stage. Accordingly, such of the petitions at Sl.No.1 to 5 in Column No.1 of the table relating to challenge to show-cause notice are disposed off. Insofar as such writ petitions as detailed in Column 2 of the table relating to challenge to Orders-in- Original, in light of the discussion made above, the Orders-in-Original stand set aside and the matters are relegated to the Officers to be designated to be reconsidered from the stage of show-cause notice. Accordingly, such of the petitions at Sl.No.1 to 35 in - 6 - HC-KAR NC: 2026:KHC:22360 WP No. 10689 of 2026 Column No.2 of the table relating to challenge to Orders-in-Original are disposed off. The petitioners who are now relegated before the authorities concerned are at liberty to file their pleadings within a reasonable time as may be fixed by the Officers concerned. Wherever the matters are pending in appeal in light of the arrangement that is made, petitioners to file a memo for withdrawal of appeal and accordingly, the orders-in- original in question would also receive the same treatment, i.e. be set aside as per the directions made above. Wherever demands have been made pursuant to the impugned orders, such proceedings are also set aside." 7. Accordingly, the Order-in-Original at Annexure-'E' is set aside. The matter is remitted to the stage of reply to the show cause notice. The Authorities to take note of the observations made in the order dated 03.07.2024 passed in W.P.No.11154/2023 and connected petitions as extracted supra, in specific, to the observations at para-10 - 7 - HC-KAR NC: 2026:KHC:22360 WP No. 10689 of 2026 of the order as may be applicable. All contentions are kept open. 8. Needless to state that the petitioner is at liberty to make out a fresh reply to the show cause notice. Accordingly, the petition is disposed of. Sd/- (S SUNIL DUTT YADAV) JUDGE NP