Tvl. S.M.Traders vs. The State Tax Officer

Held

The Court quashed the impugned assessment order dated 04.12.2025. The case was remitted back to the respondent for fresh adjudication, subject to the petitioner depositing 25% of the disputed tax in cash from their Electronic Cash Register, after deducting the amount already recovered. This deposit is to be made within thirty days of receiving a copy of the order, and the recovery amount is subject to verification. The petitioner is also required to file a reply to the Show Cause Notice dated 25.07.2025, along with supporting documents, within the same period, treating the impugned order as an addendum to the show cause notice. If these conditions are met, the respondent shall pass a final order on merits expeditiously, preferably within three months of the reply and pre-deposit. Failure to comply with these stipulations would allow the respondent to proceed with recovery as if the writ petition was dismissed. The Court expressly noted the expiry of the appeal period but chose to grant relief based on the petitioner's compliance offer.

Facts

The petitioner, M/s. S.M. Traders, filed a writ petition challenging an assessment order dated 04.12.2025, passed by the State Tax Officer, Sengottai Assessment Circle. This order confirmed the proposal in a Show Cause Notice dated 25.07.2025, as no reply was filed by the petitioner. The petitioner acknowledged that the limitation period for filing an appeal under Section 107 of the GST enactments had expired, and the writ petition was filed on 24.08.2026. The petitioner stated that 65% of the disputed tax had already been recovered and expressed willingness to pre-deposit 25% of the disputed tax for a fresh adjudication.

Key Issues

1. Whether the Court should entertain a writ petition challenging an assessment order when the statutory remedy of appeal under Section 107 of the GST enactments is available but time-barred? Petitioner's argument: The petitioner argued that despite the time-barred appeal, the Court should consider the matter due to the recovery of a significant portion (65%) of the disputed tax and their willingness to pre-deposit 25% of the remaining disputed tax. They sought de novo adjudication. Respondent's argument: The respondent, represented by the Government Advocate (Taxes), did not explicitly record arguments against entertaining the writ petition or the petitioner's offer. However, the fact that the limitation period for appeal had expired was noted by the Court.