Associate Decor Ltd VS Deputy Commissioner Of Commercial Taxes (Audit )-5.7, Bengaluru

This summary provides an overview of a series of legal challenges concerning notices and documents issued by the Respondent under the Karnataka Goods and Services Tax (KGST) Act and the Central Goods and Services Tax (CGST) Act These challenges pertain to the period from July 2017 to March 2018 and the petitioner seeks to quash various notices, reports, and audit inquiries issued by the Respondent

1 Quashing the Notice Dated 20.05.2021
The petitioner requests the quashing of a notice issued by the Respondent on 20.05.2021 under Rule 101(4) of the KGST Rules and CGST Rules read with Section 65 of the KGST Act and CGST Act This notice relates to the period from July 2017 to March 2018

2 Quashing the Revised Intimation Notice Dated 29.06.2021
The petitioner challenges a revised intimation notice issued by the Respondent on 29.06.2021 This notice like the one mentioned above was issued under Rule 101(4) of the KGST and CGST Rules read with Section 65 of the respective Acts and pertains to the same period July 2017 to March 2018

3 Quashing the Audit Inquiry Dated 22.07.2021
The petitioner seeks to quash an audit inquiry dated 22.07.2021 issued by the Respondent This inquiry also covers the period from July 2017 to March 2018

4 Quashing the Audit Report Dated 22.06.2021
The petitioner challenges the audit report issued by the Respondent on 22.06.2021 under Section 65(6) of the KGST Act and CGST Act This report pertains to the period from July 2017 to March 2018

5 Quashing the Intimation Issued in Form GST DRC-01A Dated 01.09.2021
The petitioner seeks to quash an intimation issued in Form GST DRC-01A with Case ID No.ASSMT/01/2021-22 dated 01.09.2021 This intimation was issued by the Respondent under Section 74(5) of the KGST Act and the CGST Act and relates to the same period under scrutiny

6 Quashing the Notice Dated 22.10.2021 in GST Form ADT-01
The petitioner also challenges a notice dated 22.10.2021 issued in GST Form ADT-01 under Section 65 of the KGST Act

In summary the petitioner is contesting a series of actions taken by the Respondent related to the audit and assessment of tax liabilities for the period from July 2017 to March 2018 under both the KGST and CGST frameworks The petitioner seeks to have all these notices reports and inquiries quashed

This summary provides an extensive overview of a legal dispute in which the petitioner is seeking to quash several notices, reports, and inquiries issued by the Respondent under various provisions of the Karnataka Goods and Services Tax (KGST) Act, the Central Goods and Services Tax (CGST) Act, and the Integrated Goods and Services Tax (IGST) Act. The dispute involves assessments, audits, and show cause notices pertaining to different financial years, specifically 2017-2018, 2018-2019, and 2019-2020.

1. **Quashing the Notice Dated 20.05.2021**:
– The petitioner seeks to quash a notice issued on 20.05.2021 by the Respondent under Rule 101(4) of the KGST Rules and CGST Rules, read with Section 65 of the KGST Act and CGST Act, concerning the period from July 2017 to March 2018. The petitioner contends that this notice is legally unsustainable and should be set aside.

2. **Quashing the Revised Intimation Notice Dated 29.06.2021**:
– The petitioner challenges a revised intimation notice issued on 29.06.2021 by the Respondent under the same provisions as the previous notice, also related to the period from July 2017 to March 2018. The petitioner argues that this revised notice is flawed for similar reasons and requests its annulment.

3. **Quashing the Audit Inquiry Dated 22.07.2021**:
– The petitioner seeks to quash an audit inquiry dated 22.07.2021 issued by the Respondent for the period from July 2017 to March 2018. The petitioner claims that the audit inquiry is based on erroneous assumptions and should not be upheld.

4. **Quashing the Audit Report Dated 22.06.2021**:
– The petitioner also seeks to quash an audit report issued by the Respondent on 22.06.2021 under Section 65(6) of the KGST Act and CGST Act for the period from July 2017 to March 2018. The petitioner argues that this audit report contains significant errors and is not in accordance with the law.

5. **Quashing the Intimation Issued in Form GST DRC-01A Dated 01.09.2021**:
– The petitioner challenges an intimation issued in Form GST DRC-01A, with Case ID No. ASSMT/01/2021-22, dated 01.09.2021 by the Respondent under Section 74(5) of the KGST Act and CGST Act. The petitioner argues that this intimation, which pertains to the same period (July 2017 to March 2018), is based on flawed grounds and should be quashed.

6. **Quashing the Notice Dated 22.10.2021 in GST Form ADT-01 for the Financial Year 2018-2019**:
– The petitioner seeks to quash a notice issued on 22.10.2021 in GST Form ADT-01 under Section 65 of the KGST Act and CGST Act for the financial year 2018-2019. The petitioner contends that the notice is invalid and requests its annulment.

7. **Quashing the Notice Dated 22.10.2021 in GST Form ADT-01 for the Financial Year 2019-2020**:
– The petitioner also challenges another notice issued on the same date (22.10.2021) in GST Form ADT-01, but this one pertains to the financial year 2019-2020. The petitioner argues that this notice, like the others, is legally unsound and should be quashed.

8. **Quashing the Show Cause Notice Dated 15.11.2021**:
– The petitioner seeks to quash a show cause notice issued on 15.11.2021 by the Respondent under Section 74 read with Section 65, Section 50, and Section 122 of the KGST Act and CGST Act, as well as Section 6 of the IGST Act, 2017. The petitioner contends that the show cause notice is based on incorrect interpretations of the law and requests its annulment.

9. **Other Orders and Reliefs**:
– The petitioner requests that the Hon’ble Court pass any other orders or provide any further reliefs as it deems fit in the interests of justice and equity, given the facts and circumstances of the case.

In the hearing, Sri T. Suryanarayana, learned Senior Counsel for the petitioner, presented the petitioner’s case, while Sri Hema Kumar, learned Advocate General (AGA) for the respondent, defended the Respondent’s actions. The Court was invited to review the material on record, including the amended petition and subsequent documents, to assess the merits of the petitioner’s contentions.

The petitioner’s case is built on the argument that the various notices, audit reports, and show cause notices issued by the Respondent are procedurally and substantively flawed. The petitioner contends that these actions are not in accordance with the applicable legal provisions under the KGST, CGST, and IGST Acts and therefore seeks their annulment. The outcome of this case will hinge on the Court’s interpretation of the legal and factual issues raised by the petitioner and the Respondent.

This summary provides an extensive overview of a legal petition challenging multiple notices and documents issued by the Respondent under the Karnataka Goods and Services Tax (KGST) Act, the Central Goods and Services Tax (CGST) Act, and the Integrated Goods and Services Tax (IGST) Act. These notices pertain to the financial years 2018-2019 and 2019-2020. The petitioner seeks the quashing of these notices on various grounds, particularly emphasizing the moratorium imposed by the National Company Law Tribunal (NCLT) due to the corporate insolvency resolution process initiated against the petitioner.

1. **Quashing of the Notice for the Financial Year 2018-2019**:
– The petitioner requests the quashing of a notice related to the financial year 2018-2019, issued by the Respondent under the KGST and CGST Acts. This notice, attached as Annexure-Q, is part of the ongoing audit and assessment procedures against the petitioner.

2. **Quashing of the Notice Dated 22.10.2021 for the Financial Year 2019-2020**:
– The petitioner challenges another notice dated 22.10.2021, issued in GST Form ADT-01 under Section 65 of the KGST Act and CGST Act. This notice pertains to the financial year 2019-2020 and is attached as Annexure-R.

3. **Quashing of the Show Cause Notice Dated 15.11.2021**:
– The petitioner seeks to quash a Show Cause Notice dated 15.11.2021, issued by the Respondent under Section 74 read with Sections 65, 50, and 122 of the KGST and CGST Acts, and Section 6 of the IGST Act, 2017. This notice is provided as Annexure-T and is central to the petitioner’s grievances.

4. **Request for Additional Orders**:
– In addition to the specific quashing requests, the petitioner seeks any other orders or reliefs that the Hon’ble Court may deem appropriate under the facts and circumstances of the case, in the interests of justice and equity.

5. **Legal Arguments and Proceedings**:
– The case was presented by Sri T. Suryanarayana, learned Senior Counsel for the petitioner, and Sri Hema Kumar, learned Additional Government Advocate (AGA) for the Respondent. The Court considered the petitioner’s arguments and the material on record, which includes the amended petition and subsequent documents.

6. **Moratorium Under the Insolvency and Bankruptcy Code (IBC)**:
– A significant aspect of the petitioner’s argument is the moratorium imposed by the NCLT, Bengaluru Bench, on 26.10.2018. This moratorium was declared under the Insolvency and Bankruptcy Code, 2016 (IBC), initiating the corporate insolvency resolution process against the petitioner. The moratorium prohibits the continuation of any suits, proceedings, etc., against the petitioner until it is lifted in accordance with the IBC.

– Despite this moratorium, the petitioner argues that the Respondent has continued to pursue proceedings against them. The petitioner contends that these actions by the Respondent are illegal, arbitrary, without jurisdiction, and contrary to Section 14 of the IBC. The petitioner, therefore, has approached the court seeking relief through this petition.

7. **Legal Precedents and Reliance**:
– In support of his contentions, the learned Senior Counsel for the petitioner referred to various legal decisions that establish precedents in similar cases involving the continuation of legal proceedings despite a moratorium under the IBC.

This petition is a comprehensive challenge to the ongoing actions taken by the Respondent against the petitioner, emphasizing the illegality of continuing such proceedings during the moratorium period mandated by the IBC. The petitioner seeks judicial intervention to quash the contested notices and to uphold the protections offered under the insolvency law.

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