NCS Pearson v. State of Karnataka
2025-VIL-969-KAR
Summary
The Appellant filed an application for advance ruling in relation to classification of services as OIDAR services.
The Authority for advance ruling decided the matter party in the favour of the petitioner. Aggrieved by the same, the respondent filed an appeal before Appellate Authority for advance ruling where the question was answered in the favour of revenue.
Aggrieved by the ruling by the Appellate Authority, Petitioner filed a writ petition before the High Court.
Pending such writ, the respondents issued a notice under section 74 of CGST Act alleging short payment of tax on such services by the reason of fraud or any wilful statement or suppression of facts. Aggrieved by the same, the Petitioner preferred a writ before the High Court.
After due consideration to the submissions made by the Petitioner, the Court has observed that SCN issued by the Respondent is illegal and arbitrary being manifestly violative of the law for want of satisfaction of the jurisdictional facts contemplated in Section 74 of the CGST Act and that the impugned show cause notice is wholly without jurisdiction or authority of law as the foundational jurisdictional facts to trigger / invoke Section 74 of the CGST Act i.e., existence of wilful suppression to evade / avoid payment of GST has not been satisfied by the respondents and the impugned show cause notice deserves to be quashed.
Accordingly, the Court quashed the SCN issued by the Respondents being SCN issued wholly without Jurisdiction.