S.S.B. Sekar Maligai vs. The State Tax Officer

Held

The Court quashed the impugned order dated 30.12.2025. The matter was remitted back to the respondent for de novo adjudication concerning the demand on account of credit notes. This decision was made subject to the petitioner depositing 25% of the disputed tax in cash through their Electronic Cash Ledger within thirty days of receiving the order. Additionally, the petitioner was directed to file a reply to the Show Cause Notice dated 29.09.2025, along with supporting documents, within the same period, treating the impugned order as an addendum to the Show Cause Notice. The respondent was instructed to pass a fresh order on merits after receiving the deposit and reply, preferably within three months. The Court also stipulated that if the petitioner failed to comply with these conditions, the respondent could proceed with recovery as if the writ petition was dismissed. The respondent must provide due notice to the petitioner before passing any fresh order. The ratio decidendi is that where an order is passed without considering a relevant reply or where principles of natural justice are potentially violated, and parties are willing to make a pre-deposit, a High Court in its writ jurisdiction may quash the order and remit the matter for fresh consideration, provided the conditions are met.

Facts

The petitioner, S.S.B. Sekar Maligai, represented by its Proprietor B. Sekar, filed a writ petition challenging an order dated 30.12.2025 passed by the respondent, the State Tax Officer, Pattukkottai II Assessment Circle. This order confirmed a part of the demand proposed in a Show Cause Notice (DRC-01) dated 29.09.2025, specifically concerning credit notes. The petitioner's reply to the Show Cause Notice, filed on 25.11.2025, only addressed the issue of exempted turnover, for which no demand was raised. The limitation period for filing an appeal against the impugned order had expired by the time the writ petition was filed on 31.08.2026.

Key Issues

1. Whether the impugned order dated 30.12.2025, confirming a demand on account of credit notes without a proper reply from the petitioner on that specific issue, is illegal, arbitrary, and against the principles of natural justice, particularly when the petitioner's reply focused on a different issue (exempted turnover) and the appeal period has expired? Petitioner's contention: The petitioner argued that the order was passed without considering their reply on the credit note issue and that principles of natural justice were violated. They expressed willingness to pre-deposit 25% of the disputed tax for de novo adjudication. Respondent's contention: The respondent, represented by the Government Advocate (Taxes), took notice of the petition. No specific arguments were recorded from the respondent's side regarding the merits of the petitioner's challenge.