- 1 - HC-KAR CNR: KAHC010289442026 NC: 2026:KHC:54437 WP No. 13471 of 2026 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 30TH DAY OF SEPTEMBER, 2026 BEFORE THE HON'BLE MR. JUSTICE B M SHYAM PRASAD WRIT PETITION NO. 13471 OF 2026 (T-RES) BETWEEN: M/S SHIVNEEL GAS SALES A PROPRIETORSHIP FIRM REPRESENTED BY SHRI GANESH PRASAD, AGED ABOUT 71 YEARS, SON OF RUDRARADHYA R K COMPLEX, SHAREEF STREET CHIKAMAGALURU - 577 101. …PETITIONER (BY SRI. PRANAY SHARMA Y., ADVOCATE FOR SRI. RAVI SHANKAR S V., ADVOCATE) AND: 1. THE ASSISTANT COMMISSIONER OF COMMERCIAL TAXES (AUDIT) RTO OFFICE, JYOTHI NAGAR, K M ROAD, CHIKKAMAGALUR - 577102. 2. JOINT COMMISSIONER OF COMMERCIAL TAX DGSTO VTK BHAVAN, GOPALA GOWDA LAYOUT 60 FEET ROAD SHIVAMOGGA - 577205. Digitally signed by VANAMALA N Location: HIGH COURT OF KARNATAKA - 2 - HC-KAR CNR: KAHC010289442026 NC: 2026:KHC:54437 WP No. 13471 of 2026 3. CENTRAL BOARD OF INDIRECT TAXES AND CUSTOMS REPRESENTED BY ITS CHAIRPERSON, NORTH BLOCK, NEW DELHI - 110 001. 4. UNION OF INDIA FINANCE DEPARTMENT, MINISTRY OF FINANCE, NEW DELHI - 110 001 REPRESENTED BY ADDITIONAL SOLICITOR GENERAL. …RESPONDENTS (BY SMT.MALAVIKA PRASAD., HCGP FOR R1 & R2; SRI. KUMAR M N., CGC FOR R3 & R4) THIS WP IS FILED PRAYING TOI) QUASHING THE ORDER OF ADJUDICATION PASSED UNDER SECTION 73(9) OF THE ACT DATED 01.12.2023 VIDE NO ACCT(A)/CKM/GST/2023-24/T.NO.102 PASSED BY RESPONDENT NO.1. COPY OF THE ORDER OF ADJUDICATION DATED 01.12.2023 PASSED BY RESPONDENT NO.1 DATED 01.12.2023 IS ENCLOSED AND MARKED AS ANNEXURE-A1.II) QUASHING THE GST FORM DRC-07 BEARING REFERENCE NO. ZD291223004521V DATED 02.12.2023 ISSUED BY THE RESPONDENT NO.1. COPY OF THE DRC-07 DATED 02.12.2023 IS ENCLOSED AND MARKED AS ANNEXURE -A2.III) QUASHING THE SHOW CAUSE NOTICE ISSUED UNDER SECTION 73 OF THE ACT DATED 30.09.2023 - 3 - HC-KAR CNR: KAHC010289442026 NC: 2026:KHC:54437 WP No. 13471 of 2026 VIDE SCN NO. ACCT/ENF/CKM/ADT/2023-24 ISSUED BY THE RESPONDENT NO.1. COPY OF THE SHOW CAUSE NOTICE DATED 30.09.2023 IS ENCLOSED AND MARKED AS ANNEXURE A3.IV) QUASHING THE INTIMATION ISSUED UNDER SECTION 73 IN FORM GST DRC-01 DATED 30.09.2023 BEARING FILE NO.T. NO. 294/2023-24 ISSUED BY THE RESPONDENT NO.1. COPY OF THE FORM GST DRC-01 DATED 30.09.2023 IS ENCLOSED AND MARKED AS ANNEXURE -A4.V) DECLARE THAT THE SECTION 16(4) OF THE CGST ACT IS ILLEGAL AND ULTRA VIRES THE CONSTITUTION OF INDIA AND ISSUE A WRIT OF MANDAMUS OR ANY OTHER APPROPRIATE WRIT OR ORDER OR DIRECTION AND HOLD THAT THE SECTION 16(4) OF THE ACT IS ARBITRARY AND CONTRARY TO THE POSITION OF LAW.VI) DECLARE THAT THE IMPUGNED NOTIFICATION NO.9/2023-CT DATED 31.03.2023 IS ILLEGAL AND ULTRA VIRES THE PROVISIONS OF SECTION 168A OF CENTRAL GOODS AND SERVICE ACT, 2017 AND ISSUE A WRIT OF CERTIORARI OR ANY OTHER APPROPRIATE WRIT OR ORDER OR DIRECTION AND QUASH THE IMPUGNED NOTIFICATION 06/2023 DATED 06/04/2023 REFERRED TO AS ANNX-D.VII) DECLARE THAT THE IMPUGNED NOTIFICATION 06/2023 DATED 06.04.2023 IS ILLEGAL AND ULTRA VIRES THE PROVISIONS OF SECTION 168A OF KARNATAKA GOODS AND SERVICE ACT, 2017 AND ISSUE A WRIT OF CERTIORARI OR ANY OTHER APPROPRIATE WRIT OR ORDER OR DIRECTION - 4 - HC-KAR CNR: KAHC010289442026 NC: 2026:KHC:54437 WP No. 13471 of 2026 AND QUASH THE IMPUGNED NOTIFICATION 06/2023 DATED 06.04.2023 REFERRED TO AS ANNEXURE - D.VIII) DIRECT THE RESPONDENT TO GIVE INPUT TAX CREDIT OF THE CLAIM OF THE PETITIONER FOR THE FINANCIAL YEAR 2017-18. THIS PETITION, COMING ON FOR ORDERS, 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 Adjudication Order dated 01.12.2023 under Section 73 of the Central Goods and Services Tax Act, 2017/Karnataka Goods and Services Tax Act, 2017 [for short, ‘the Act’]. The details of the Adjudication Order and the Summary thereof are as follows. Sl. No. Particulars Dated Provisions of KGST Act, 2017 Annexure 1 Order of Adjudication 01.12.2023 73[9] A1 2 Summary of the Order 02.12.2023 A2 - 5 - HC-KAR CNR: KAHC010289442026 NC: 2026:KHC:54437 WP No. 13471 of 2026 3 Show Cause Notice 30.09.2023 73 A3 4 Summary of the Show Cause Notice 30.09.2023 A4 2. Mr. Pranay Sharma Y, the learned counsel for the petitioner, and Ms. Malavika Prasad, the learned High Court Government Pleader for the respondents, are heard for disposal of the petition with the petitioner placing reliance upon the amendment with the insertion of Section 16[5] of the Act with effect from 01.07.2017. 3. The proceedings against the petitioner, as could be seen from the tabular column that is part of the Adjudication Order, is because the petitioner has filed Returns beyond the due date for filing such Returns. The impugned Order relates to the period between July 2017 to March 2018, and the petitioner, who had to file Returns for the - 6 - HC-KAR CNR: KAHC010289442026 NC: 2026:KHC:54437 WP No. 13471 of 2026 corresponding months, between August 2017 to April 2019 has filed the Returns in the months between April 2019 to August 2019. Whether the delay in filing the Returns could defeat the Registered Taxable Person’s right to Input Tax Credit [ITC] is addressed with the insertion of sub-clause [5] to Section 16 of the Act with effect from 01.07.2017. 4. This amendment reads that the Registered Taxable Person will be entitled to ITC in any Return that is filed upto 30.11.2021 for the Returns pertaining to the years 2017-18 to 2020-21. This amendment was not on the Statute Book when the impugned Order is passed. The petitioner’s case is that this amendment must apply in this case, and undisputedly it is because the subject tax period is between the period mentioned in the amendment. 5. However, this Court is of the considered view that whether there must be any enforcement in - 7 - HC-KAR CNR: KAHC010289442026 NC: 2026:KHC:54437 WP No. 13471 of 2026 the light of this amendment must be reconsidered with opportunity to the petitioner with a formal order because it is shown to this Court's satisfaction that the petitioner will be entitled to the ITC because the Returns have been filed before 30.11.2021. In the light of the afore, the following. ORDER [A] The petition is allowed quashing the impugned Adjudication Order dated 01.12.2023 [Annexure-A1] restoring the proceedings to the first respondent to pass a formal order in the light of this Court's observation on the petitioner being entitled to ITC in the light of the retrospective insertion of Section 16[5] of the Act. [B] The petitioner is reserved with liberty to file a certified copy of this Order with the first respondent, who shall - 8 - HC-KAR CNR: KAHC010289442026 NC: 2026:KHC:54437 WP No. 13471 of 2026 communicate the Order in terms of this Court's observation by 30.10.2026 and the first respondent shall communicate the order in terms of this Court's observation to the petitioner by 30.11.2026. Sd/- (B M SHYAM PRASAD) JUDGE AN/-