Infomart India v Asst Commissioner: Karnataka HC on Section 73 Ex-Parte GST Order

This case examines a writ petition filed before the Karnataka High Court challenging an ex-parte demand order passed under Section 73 of the CGST/KGST Act, 2017 against M/S Infomart (India) Private Limited — a Bengaluru-based private company — after its reply to a show-cause notice was not submitted due to the authorised Chartered Accountant's personal health emergencies. The case is significant for GST practitioners because it illustrates the circumstances in which a High Court, exercising writ jurisdiction under Articles 226 and 227 of the Constitution, will intervene to set aside an ex-parte Section 73 adjudication order and restore the matter to the show-cause notice stage, even after a statutory appeal has been dismissed as time-barred.

This page is a research summary of one specific Indian tax judgment, NOT legal advice. Always verify against the full judgment and consult a professional for case-specific guidance.

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The case at a glance

• Parties: M/S Infomart (India) Private Limited vs Asst Commissioner Of Commercial Taxes
• Bench: Karnataka High Court
• Date: 15 December 2025
• Court level: High Court
• Sections engaged: 73, 73(1)
• Outcome: Remanded for fresh consideration — petition allowed; both the adjudication order (01.08.2024) and the appellate order (12.09.2025) set aside; matter remitted to the first respondent from the reply stage.

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Facts of the case

M/S Infomart (India) Private Limited, registered at No. 99, Infomart Tech Park, 5th Cross, 5th Block, Koramangala, Bengaluru — 560 095, and represented by its Director Smt. Anjali Agarwal, received a show-cause notice dated 02.04.2024 issued by the Assistant Commissioner of Commercial Taxes (Audit)-4.8, DGSTO-4, under Section 73(1) of the CGST/KGST Act, 2017. The notice was handed over to the company's Chartered Accountants, M/s. Keshav & Co., for a suitable reply. However, the concerned Chartered Accountant could not submit the reply or contest the proceedings due to health issues affecting both himself and his child.

Since no reply was filed, the first respondent proceeded ex-parte and passed the impugned order dated 01.08.2024 under Section 73 of the KGST/CGST Act, 2017, confirming a total demand of ₹3,32,848/- comprising tax, interest, and penalty. Following the issuance of recovery notices, the petitioner filed a statutory appeal on 10.09.2025 before the Joint Commissioner of Commercial Taxes (Appeals)-4, Bengaluru. That appeal was dismissed as barred by limitation vide order dated 12.09.2025 under Section 107(11) of the KGST/CGST Act, 2017.

With the GST Appellate Tribunal not yet constituted at the time of filing, the petitioner had no further statutory appellate remedy and accordingly approached the Karnataka High Court by way of Writ Petition No. 37779 of 2025 (T-RES) under Articles 226 and 227 of the Constitution of India, seeking a writ of certiorari to quash both the adjudication order and the appellate order, and to relegate the matter to the stage of the show-cause notice.

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Issues raised

• Whether the ex-parte demand order dated 01.08.2024 under Section 73 of the KGST/CGST Act, 2017, passed without the petitioner's reply, could be sustained when the non-submission of the reply was attributable to bonafide reasons and unavoidable circumstances.
• Whether the appellate order dated 12.09.2025 dismissing the statutory appeal as time-barred under Section 107(11) of the KGST/CGST Act, 2017 was valid in the context of those same bonafide reasons.
• Whether, in the absence of a constituted GST Appellate Tribunal, the High Court's writ jurisdiction under Articles 226 and 227 was appropriately invoked.
• Whether the petitioner was entitled to one more opportunity to file its reply and contest the show-cause notice proceedings.

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What the court held

The petition was allowed. The Hon'ble Mr. Justice S.R. Krishna Kumar set aside both the impugned order dated 01.08.2024 passed by the first respondent under Section 73 of the KGST/CGST Act, 2017 and the appellate order dated 12.09.2025 passed by the second respondent under Section 107(11) of the KGST/CGST Act, 2017. The matter was remitted back to the first respondent for reconsideration afresh in accordance with law from the stage of the petitioner submitting its reply to the show-cause notice dated 02.04.2024.

The Court's reasoning turned on a "justice oriented approach." Having regard to the specific assertion that the petitioner's inability and omission to submit replies and contest the proceedings was due to bonafide reasons, unavoidable circumstances, and sufficient cause, the Court found it just and appropriate to provide one more opportunity. The Court did not return a finding that the underlying tax demand was incorrect; rather, it determined that the petitioner had not had a meaningful opportunity to respond, and that this procedural deficit justified restoring the matter to the pre-adjudication stage.

The operative directions of the Court include: the petitioner is directed to appear before the first respondent on 02.02.2026 without awaiting any further notice; the petitioner retains liberty to submit replies and documents, which the first respondent shall consider after providing sufficient and reasonable opportunity and hearing; and, critically, if the petitioner does not appear before the first respondent on 02.02.2026, the present order shall stand automatically recalled without further orders.

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Strategy observations

1. Writ jurisdiction invoked in the absence of a statutory forum: An additional procedural route was pursued before the High Court under Articles 226 and 227 of the Constitution after the statutory appeal before the Joint Commissioner (Appeals) was dismissed as time-barred. The order records that the GST Appellate Tribunal had not been constituted as of the date of filing, leaving the High Court as the only available forum — a factual circumstance the Court appears to have weighed in entertaining the writ.

2. Bonafide cause was the central factual plank: The petitioner placed on record the specific reason for non-filing — the health issues of the authorised Chartered Accountant, M/s. Keshav & Co. The Court's language ("specific assertion," "bonafide reasons, unavoidable circumstances and sufficient cause") indicates that the particularised explanation, rather than a general averment of hardship, formed the basis for the remand.

3. Both the adjudication order and the appellate order were challenged together: The writ petition challenged both Annexure-A (the Section 73 adjudication order) and Annexure-B (the Section 107(11) appellate order). The Court set aside both, restoring the matter to the earliest stage — the reply to the show-cause notice — rather than merely remanding to the appellate authority.

4. Conditional nature of the remand order: The Court's order is expressly conditional: non-appearance by the petitioner before the first respondent on 02.02.2026 triggers automatic recall of the order. This structural feature — a self-lapsing remand — is a notable aspect of the disposition that practitioners researching similar writ orders should note.

5. No merits adjudication: The Court expressly did not decide whether the demand of ₹3,32,848/- was correct on the merits. The remand is purely procedural, restoring the right to respond; the substantive Section 73 demand remains to be decided by the first respondent after a fresh hearing.

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Why this case matters

This order is part of a well-documented pattern in which Indian High Courts exercise writ jurisdiction to set aside ex-parte GST adjudication orders where the taxpayer can demonstrate that non-participation in the proceedings was attributable to bonafide and unavoidable causes rather than deliberate default. The Karnataka High Court's explicit adoption of a "justice oriented approach" in this context, particularly in the interim period before the GST Appellate Tribunal becomes operational across jurisdictions, underscores the relevance of the constitutional writ remedy as a safety valve for taxpayers who have exhausted or lost access to the statutory appellate chain.

For researchers tracking Section 73 adjudication jurisprudence, the case is a useful data point on (a) the threshold of cause required to have an ex-parte order set aside at the writ stage, (b) the Court's willingness to remand directly to the show-cause notice reply stage rather than the appeal stage, and (c) the use of conditional/self-lapsing remand orders as a judicial tool to balance procedural fairness against the risk of further delay in revenue recovery proceedings.

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Source

This case is drawn from the TaxNoticeAI structured legal corpus (16,101 Indian tax judgments, CBIC circulars, ITAT rulings, AAR rulings, GSTAT rulings), sourced from indiankanoon.org and official court portals. Original document: https://indiankanoon.org/doc/63606953/