Karnataka High Court
The Commissioner Of Central Tax ... vs The Professional Couriers on 27 January, 2026
Author: S.G.Pandit
Bench: S.G.Pandit
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NC: 2026:KHC:4329-DB
WA No. 1565 of 2025
HC-KAR
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 27TH DAY OF JANUARY, 2026
PRESENT
THE HON'BLE MR. JUSTICE S.G.PANDIT
AND
THE HON'BLE MR. JUSTICE K. V. ARAVIND
WRIT APPEAL NO. 1565 OF 2025 (T-RES)
BETWEEN:
1. THE COMMISSIONER OF CENTRAL TAX
(APPEALS - 1), 4TH FLOOR,
TTMC- BMTC BUILDING
HAL AIRPORT ROAD, DOMLUR
BANGALORE- 560071.
2. THE JOINT COMMISSIONER OF CENTRAL TAX
BENGALURU NORTH COMMISSIONERATE
NO.59, HMT BHAVAN
GANGANAGARA,
BANGALORE-560 032.
3. THE DEPUTY COMMISSIONER
OF CENTRAL TAX, NORTH DIVISION-4,
NO.59, HMT BHAVAN,
Digitally signed by GANGANAGARA,
NANJUNDACHARI
Location: HIGH BANGALORE-560032.
COURT OF ...APPELLANTS
KARNATAKA (BY SRI. UNNIKRISHNAN M., ADV.)
AND:
THE PROFESSIONAL COURIERS
A PARTNERSHIP FIRM,
REP. BY ITS MANAGING PARTNER,
MR. V.SRINATH,
SON OF SHRI. T.BALACHANDRAN
AGED ABOUT 63 YEARS,
HAVING OFFICE AT NO.195,
THE PROFESSIONAL HOUSE,
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NC: 2026:KHC:4329-DB
WA No. 1565 of 2025
HC-KAR
MARGOSA ROAD, MALLESWARAM,
BENGALURU-560055.
...RESPONDENT
(BY SRI. PRADYUMNA G.H., ADV.)
THIS WRIT APPEAL IS FILED U/S 4 OF THE KARNATAKA HIGH
COURT ACT PRAYING TO ALLOW THE ABOVE APPEAL FILED BY THE
APPELLANT THEREBY SETTING ASIDE THE ORDER PASSED BY THE
LEARNED SINGLE JUDGE IN WP NO.25012/2023 DATED 17/04/2025,
AND CONSEQUENTLY DISMISS THE SAID PETITION AND ETC.
THIS APPEAL, COMING ON FOR PRELIMINARY HEARING, THIS
DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER:
CORAM: HON'BLE MR. JUSTICE S.G.PANDIT
AND
HON'BLE MR. JUSTICE K. V. ARAVIND
ORAL JUDGMENT
(PER: HON'BLE MR. JUSTICE K.V. ARAVIND) Heard learned counsel Sri.Unnikrishnan.M., for appellants and learned counsel Sri.Pradyumna.G.H., for respondent.
2. This intra-Court appeal is preferred by the Revenue challenging the order passed by the learned Single Judge in W.P. No. 25012 of 2023, dated 17.04.2025. The respondent herein had filed the writ petition assailing the order dated 15.09.2023 passed by the Commissioner of Central Tax (Appeals-II) Appellate -3- NC: 2026:KHC:4329-DB WA No. 1565 of 2025 HC-KAR Commissioner, whereby the appeal was rejected on the ground of non-payment of the statutory pre-deposit of 7.5% as mandated under Section 35F of the Central Excise Act, 1944 (for short, "the Act").
3. The respondent was issued a show-cause notice on various issues, which culminated in an order of adjudication dated 24.08.2022. Aggrieved by the said order, the respondent preferred an appeal before the Appellate Commissioner, Bengaluru. The appeal came to be rejected for non-compliance with the statutory requirement of pre-deposit under Section 35F of the Act. Thereafter, the respondent filed a writ petition challenging the order passed by the Appellate Commissioner. The learned Single Judge, under the impugned order, proceeded to set aside the order-in-original dated 24.08.2022.
4. In addition to assailing the order dated 15.09.2023 passed by the Appellate Commissioner, Sri -4- NC: 2026:KHC:4329-DB WA No. 1565 of 2025 HC-KAR Unnikrishnan M., learned Senior Standing Counsel appearing for the appellants, submits that the respondent- assessee, being aggrieved by the order-in-original dated 24.08.2022, had preferred an appeal before the Appellate Commissioner. To maintain the said appeal, the respondent-assessee was mandatorily required to make a pre-deposit of 7.5% of the disputed amount in terms of Section 35F of the Act. It is submitted that, on account of non-compliance with the said mandatory requirement, the appeal came to be dismissed. Learned counsel further submits that when the correctness of the said order was questioned in the writ petition, the learned Single Judge committed an error in setting aside the order-in-original dated 24.08.2022.
5. Learned counsel Sri Pradyumna G.H., appearing for the respondent-assessee, submits that the challenge to the order-in-original dated 24.08.2022 was also raised in the writ petition and, therefore, the learned Single Judge was justified in examining the correctness of the said -5- NC: 2026:KHC:4329-DB WA No. 1565 of 2025 HC-KAR order. Learned counsel further submits that the issues adjudicated in the order-in-original were the subject matter of the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 (for short, "SVLDR Scheme"), pursuant to which a discharge certificate was issued, and that the very same issues were again made the subject matter of the show-cause notice and adjudicated against the respondent.
5.1 Learned counsel would further submit that, if the amounts paid pursuant to the discharge certificate issued under the SVLDR Scheme are taken into consideration, the amount so paid is far in excess of the mandatory pre-deposit of 7.5% required under Section 35F of the Act. It is contended that the Appellate Commissioner committed an error in not taking into account the deposits made pursuant to the discharge certificate. Learned counsel further submits that, in view of the amounts already deposited being in excess of 7.5%, -6- NC: 2026:KHC:4329-DB WA No. 1565 of 2025 HC-KAR the Appellate Commissioner ought to have entertained the appeal and adjudicated the same on merits.
6. We have considered the submissions of learned counsel appearing for the parties and perused the appeal papers.
7. From the pleadings, it appears that the respondent had an existing liability and had filed an application under the SVLDR Scheme, pursuant to which a discharge certificate was issued. As pleaded, subsequent to the issuance of the discharge certificate, a show-cause notice came to be issued, culminating in the order-in- original dated 24.08.2022. It is the contention of the respondent that the issues adjudicated in the order-in- original had already been settled under the Scheme and that the entire liability as reflected in the discharge certificate stood discharged.
8. When the respondent preferred an appeal before the Appellate Commissioner, the said contention -7- NC: 2026:KHC:4329-DB WA No. 1565 of 2025 HC-KAR was canvassed. The Appellate Commissioner, upon consideration of the submissions, rejected the said contention and dismissed the appeal on the ground of non-payment of the mandatory pre-deposit. When the said order was assailed in the writ petition, the scope of the writ petition was confined only to the correctness of the order at Annexure-A dated 15.09.2023. There was no prayer seeking to challenge the order-in-original dated 24.08.2022.
9. In that view of the matter, we are of the considered opinion that the learned Single Judge committed an error in quashing the order-in-original at Annexure-E dated 24.08.2022.
10. Insofar as the order dated 15.09.2023 passed by the Appellate Commissioner is concerned, we note that the respondent-assessee has contended that the amounts paid pursuant to the discharge certificate issued under the SVLDR Scheme satisfies the requirement of the statutory -8- NC: 2026:KHC:4329-DB WA No. 1565 of 2025 HC-KAR pre-deposit of 7.5%. To address such contention, the Appellate Commissioner is required to examine the appeal on merits. At the same time, the requirement of a mandatory pre-deposit of 7.5% cannot be dispensed with.
11. Having regard to the peculiar facts involved in the present case, we are of the considered opinion that the Appellate Commissioner is required to adjudicate the appeal on merits, including the question of taxability or otherwise of the issues involved, in the light of the specific contention that the very issues stood settled under the SVLDR Scheme and that the requisite amounts have already been paid pursuant to the discharge certificate.
12. The above exercise can be undertaken by the Appellate Commissioner by way of a common adjudication. We accordingly direct the Appellate Commissioner to adjudicate the appeal on merits as well as the contention of the respondent-assessee regarding compliance with the requirement of pre-deposit of 7.5%. It is, however, made -9- NC: 2026:KHC:4329-DB WA No. 1565 of 2025 HC-KAR clear that the outcome of the appeal shall be subject to compliance with Section 35F of the Act, as recorded by the Appellate Commissioner.
13. With the above observations, we pass the following:
ORDER
a) Writ appeal is allowed.
b) Order of the learned Single Judge in W.P.No.25012/2023 is set aside only to the extent of setting aside the order in original at Annexure-E dated 24.08.2022.
c) The order dated 15.09.2023 passed by Commissioner of Central Tax (Appeals-II) is set aside and remitted back for fresh consideration the light of above observations.
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NC: 2026:KHC:4329-DB WA No. 1565 of 2025 HC-KAR
d) We have passed the above order in view of the peculiar facts involved in the present case and this order shall not be treated as precedent in any other case.
Sd/-
(S.G.PANDIT) JUDGE Sd/-
(K. V. ARAVIND) JUDGE NC CT:bms List No.: 2 Sl No.: 16