Karnataka HC Allows Arbitration Plea Filed By Retired Partner As It Was Not Filed As Partner Of Unregistered Firm

The Karnataka High Court has held that, in the facts of the case, a retired partner can seek to refer a dispute to arbitration to defend himself in a recovery suit, and such a plea cannot be rejected merely because the partnership firm was not registered. A Division Bench comprising Chief Justice Vibhu Bakhru and Justice C.M. Poonacha was considering an appeal challenging an order of the Commercial Court, which had refused to refer the parties to arbitration under Section 8 of the Arbitration...

Busy Schedule, Travel Not 'Sufficient Cause': Karnataka High Court Refuses To Condone Delay In Arbitration Appeal

The Karnataka High Court has recently refused to condone a delay of 85 days in filing an appeal under Section 37 of the Arbitration and Conciliation Act, 1996, holding that a busy schedule and travel do not constitute “sufficient cause." Holding that the appeal was barred by limitation and also devoid of merit, the court dismissed the appeal filed by L Vivekananda against Handy 101 Solutions and Service Pvt. Ltd. and its promoter Peter Pushparaj, thereby upholding the Commercial Court's order...

Pigmy Agents Are Employees, Commission Paid Them Not Subject To GST: Karnataka High Court

The Karnataka High Court on 8 April, held that banks engage pigmy (deposit collection) agents as employees, not independent service providers. Therefore, the commission paid to them does not attract Goods and Services Tax (GST). A Bench comprising Justice M. Nagaprasanna allowed Karnataka Vikas Grameena Bank's writ petition and quashed all show cause notices issued by GST authorities under the reverse charge mechanism. He held: “The show cause notices issued by the respondent proceed on an...

Disputes Under Subsequent Agreement Without Arbitration Clause Not Arbitrable: Karnataka High Court

The Karnataka High Court on 2 April, held that an Arbitral Tribunal cannot decide disputes arising from a subsequent agreement that lacks an arbitration clause, nor can it rely on an earlier lapsed agreement whose arbitration clause has ceased to operate. A Bench comprising Chief Justice Vibhu Bakhru and Justice C.M. Poonacha set aside an award that directed execution of a sale deed between M. Mallikarjuna and Smt. Rajeshwari Mallikarjuna (appellants) and S.P. Sridhara and S.P. Muralidhar...

Limitation To Pass Transfer Pricing Order Cannot Be Extended By Treating Remand As Fresh Reference: Karnataka High Court

Rejecting the income tax department's attempt to treat a Tribunal remand as a fresh transfer pricing reference to extend limitation, the Karnataka High Court has held that no order can be passed once the statutory time limit expires. A single-judge bench of Justice Nagaprasanna emphasised that there is a “world of difference” between a reference made by the Assessing Officer to the Transfer Pricing Officer under Section 92CA(1) and a remand of the matter by the Tribunal, rejecting the Revenue's...

Karnataka High Court Holds Bona Fide Purchaser Entitled To ITC, Reads Down Rules In Favor Of Instakart

The Karnataka High Court on 9 February 2026 held that a bona fide purchaser cannot be denied input tax credit (ITC) merely because the selling dealer failed to deposit tax with the government. A Single-Judge Bench of Justice S.R. Krishna Kumar read down Section 16(2)(C) of the CGST / KGST Act and Rule 36(4) of the CGST / KGST Rules to set aside the order denying ITC to Instakart Services Private Limited. He held: “The impugned provisions contained in Section 16(2)(C) of the CGST / KGST Act...

Shareholder Has No Proprietary Rights Over Company's Digital Assets: Karnataka High Court

The Karnataka High Court recently refused to quash an FIR registered against the Director of a Bengaluru-based algorithmic trading company for allegedly stealing, copying, and deleting the company's proprietary source code and trading algorithms, holding that a shareholder's stake does not confer any proprietary right over the company's digital assets. The single-judge bench of Justice M. Nagaprasanna held that the issue was not purely civil in nature; the court observed that the allegations...

Illegality Of Search Does Not Make Evidence Gathered Inadmissible In GST Fraud Cases: Karnataka High Court

The High Court of Karnataka at Bengaluru has ruled that the legality of search and seizure proceedings does not, by itself, make the material collected during such proceedings inadmissible for initiating action under Section 74 of the Central Goods and Services Tax Act, 2017, so long as such material is relevant to the issues involved.Section 74 of the CGST Act covers cases of tax not paid, short-paid, erroneously refunded, or Input Tax Credit (ITC) wrongly availed due to fraud, wilful...

Karnataka High Court Upholds Injunction Against 'TULSI' Agarbatti Mark, Finds Prima Facie Infringement Of 'TULASI'

The Karnataka High Court has upheld an injunction restraining the use of the “TULSI” mark for agarbattis, holding that it is prima facie deceptively similar to the long-standing “TULASI” mark and not merely descriptive of fragrance.In a judgment delivered on March 25, 2026, Justice Ravi V. Hosmani held that Jallan Enterprises' use of the word “TULSI” was displayed in a trademark-like manner that prima facie infringed the long-standing registered mark “TULASI” of Sarathi International Inc.The...

DRT Cannot Condone Delay Beyond 45 Days In Pleas Challenging SARFAESI Recovery Measures: Karnataka High Court

Recently, the Karnataka High Court held that the Debt Recovery Tribunal (DRT) cannot condone delays beyond the 45-day limit for filing applications under Section 17 of the SARFAESI Act, which allows borrowers to challenge a bank's recovery actions before the tribunal. The court clarified that Section 5 of the Limitation Act, 1963, which permits courts to excuse in case of sufficient cause, does not apply to such proceedings. The single-judge bench of Justice Lalitha Kanneganti observed...

Dispute Over Lease Of Land For Petrol Pump Is Commercial Dispute Even If Pump Not Operational: Karnataka High Court

The Karnataka High Court has recently held that a dispute arising from a lease of land for a petrol pump qualifies as a “commercial dispute” under the Commercial Courts Act, even if the business has not commenced and the project is still under construction.A Division Bench of Chief Justice Vibhu Bakhru and Justice C.M Poonacha was considering an appeal challenging an order of the Commercial Court returning the plaint on the ground that the dispute did not fall within the definition of a...

DRT Has No Inherent Power To Refund Court Fee In Section 17 SARFAESI Proceedings: Karnataka High Court

The Karnataka High Court has recently held that the Debts Recovery Tribunal (DRT) has no inherent power to refund court fees paid in proceedings under Section 17 of the SARFAESI Act in the absence of an express statutory provision, even if the proceedings become infructuous due to settlement between the parties, ruling that courts cannot order the refund of a statutory levy unless authorized by law.Emphasising that court fees are governed strictly by statute, the Division Bench of Chief Justice...