- 1 - HC-KAR NC: 2026:KHC:31323 WP No. 16647 of 2026 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 24TH DAY OF JUNE, 2026 BEFORE THE HON'BLE MR. JUSTICE B M SHYAM PRASAD WRIT PETITION NO. 16647 OF 2026 (T-RES) BETWEEN: BABURENGAN MAHENDRAN AGED ABOUT 43 YEARS SON OF SHRI BABURENGAN D HAVING OFFICE AT SRI AMIRTHA BHAVAN, NO. 972/F, 1ST A MAIN ROAD, ST BED, 4TH BLOCK, KORAMANGALA BENGALURU-560034. …PETITIONER (BY SRI. PRADYUMNA HEJIB., ADVOCATE) AND: 1. THE ADDITIONAL COMMISSIONER OF CENTRAL TAX BENGALURU SOUTH COMMISSIONERATE C.R. BUILDING, P.B. NO. 5400 QUEENS ROAD BENGALURU-560001. 2. THE ASSISTANT COMMISSIONER OF CENTRAL TAX, ARREARS RECOVERY CELL BENGALURU SOUTH COMMISSIONERATE C.R. BUILDING, P.B. NO. 5400 Digitally signed by VANAMALA N Location: HIGH COURT OF KARNATAKA - 2 - HC-KAR NC: 2026:KHC:31323 WP No. 16647 of 2026 QUEEN'S ROAD, BENGALURU-560001. …RESPONDENTS (BY SRI.ARAVIND V HCAVAN., ADVOCATE) THIS WP IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO (A) QUASH ORDER-IN-ORIGINAL BEARING NO. 82/23-24 (DIN 2024015700000041414E) DATED 19.01.2024 PASSED BY THE FIRST RESPONDENT (ANNEXURE-A); (B) QUASH RECOVERY NOTICE IN FORM GST DRC-13 BEARING NO. GEXCOM/TAR/D/ST/2343/2025-TAR- O/0 COMMR-CGST DATED 22.04.2026 (ANNEXURE-B). 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 is aggrieved by the Adjudication Order dated 19.01.2024 under Section 73 of the Finance Act, 1994 [for short, ‘the Act’]. The impugned Adjudication Order is for the financial years 2015-16 and 2016-17. The petitioner is issued with Show Cause Notice, and the petitioner has represented with the first respondent stating that he had not received - 3 - HC-KAR NC: 2026:KHC:31323 WP No. 16647 of 2026 such Show Cause Notice because it was issued during the COVID-19 period. The first respondent has furnished a copy of the Show Cause Notice. 2. When extended with opportunity of a personal hearing, the petitioner's representative has appeared and sought time to file the financials upon consulting the Auditor, but neither those financials nor a reply is filed. In view of the same, the first respondent has concluded the proceedings opining that as gathered from the third-party information the petitioner has rendered taxable services for consideration of Rs.6,45,08,948/- and this must be construed as consideration upon which the petitioner must pay taxes with interest and penalty. 3. Sri Pradyumna G. Hejib, the learned counsel for the petitioner, submits that the petitioner is bona fide in stating that he could not avail the opportunity that was extended during the personal hearing and if the petitioner is extended another - 4 - HC-KAR NC: 2026:KHC:31323 WP No. 16647 of 2026 opportunity, he can demonstrate that during the relevant financial years he was engaged in providing manpower services to corporate entities and the service taxes payable, if any, was payable under Reverse Charge Mechanism. 4. Sri Aravind V. Chavan, a learned standing counsel for the respondents, is heard in the light of these circumstances for the final disposal of the petition. The learned standing counsel emphasizes that the petitioner has approached this Court almost after two years without availing the appellate remedy underscoring that even if the appellate remedy was availed, the petitioner ought to have deposited 7.5% of the amount in demand. 5. The petitioner pleads bona fides for the failure to participate effectively in the proceedings even when extended with an opportunity of personal hearing. Crucially, on merits, the petitioner contends that it was engaged in providing manpower services - 5 - HC-KAR NC: 2026:KHC:31323 WP No. 16647 of 2026 which would attract taxes under Reverse Charge Mechanism payable by the service recipients. The petitioner contends that he can produce all documents in this regard if there is an opportunity. These circumstances are considered, and this Court opines that the petitioner must have an opportunity for a complete adjudication, but on terms. Hence, the following: ORDER The petition is allowed quashing the Adjudication Order dated 19.01.2024 [Annexure-A] subject to the following terms. [a] The proceedings are restored to the first respondent for due consideration subject to deposit of 7.5% of the demand. [b] The petitioner is permitted to file, along with the certified copy of - 6 - HC-KAR NC: 2026:KHC:31323 WP No. 16647 of 2026 this order, the details of the Returns filed by the service recipients. [c] The petitioner shall produce these documents by 27.07.2026 and the first respondent shall consider these documents and then conclude the proceedings by a reasoned order. The petitioner shall also ensure that 7.5% of the demand is deposited by this date. Sd/- (B M SHYAM PRASAD) JUDGE SA Ct:sr