M/S.Sri Murugan Enterprise vs. The Assistant Commissioner (St)
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The petitioner, M/s. Sri Murugan Enterprise, filed a Writ Petition before the Madurai Bench of the Madras High Court challenging an order dated 27.03.2026 passed by the Assistant Commissioner (ST), Madurai. This order was a Summary Order in GST DRC 07 for the tax period 2019-2020, which followed a Show Cause Notice (DRC 01) dated 30.09.2025. The petitioner was called for a personal hearing but did not avail it, leading to the impugned order. The appeal period under Section 107 of the GST enactments had expired by the time the Writ Petition was filed on 13.08.2026. The petitioner expressed willingness to pre-deposit 10% of the disputed tax for de novo adjudication.
Held
The Court quashed the impugned order dated 27.03.2026 and remitted the case back to the respondent for de novo adjudication. The Court's decision was based on the petitioner's willingness to deposit 10% of the disputed tax in cash from their Electronic Cash Register within thirty days of receiving the order. The petitioner was also directed to file a reply to the Show Cause Notice dated 30.09.2025, along with supporting documents, treating the impugned order as an addendum to the Show Cause Notice. The respondent was instructed to pass a fresh order on merits and in accordance with law, preferably within three months of the petitioner's compliance. The Court stipulated that if the petitioner failed to comply with any of these conditions, the respondent was at liberty to recover the tax as if the Writ Petition was dismissed in limine. The respondent was also directed to provide due notice to the petitioner before passing any further order. The issue of the limitation period for filing an appeal under Section 107 was implicitly bypassed due to the direction for de novo adjudication.
Key Issues
1. Whether the impugned order dated 27.03.2026, passed by the respondent authority, is liable to be quashed for gross violation of the Principles of Natural Justice, as contended by the petitioner? The petitioner argued that the impugned order was illegal and in gross violation of the Principles of Natural Justice. They contended that despite being issued a Show Cause Notice and called for a personal hearing, the final order was passed without affording a proper opportunity. The petitioner further submitted that they were willing to pre-deposit 10% of the disputed tax as a condition for de novo adjudication. The respondent, represented by the Government Advocate (Tax), did not record any specific arguments against the petitioner's plea for a fresh adjudication, but rather took notice of the petition and the petitioner's submission regarding pre-deposit.
Sections Cited
Section 107
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Before: and
M/s.P.Sudarkodi Natchiyar, learned Government Advocate (Tax), takes notice for the respondent.
This Writ Petition is taken up for final hearing at the time of admission with the consent of the learned counsel for the petitioner and the learned Government Advocate (Tax) for the respondent.
In this Writ Petition, the petitioner has challenged the impugned Summary Order in GST DRC 07 dated 27.03.2026 bearing reference in No. 33BRJPK4325D1Z5 of the respondent for the tax period 2019-20, which was preceded by a Show Cause Notice in DRC 01 dated 30.09.2025 wherein the petitioner was also called upon to appear for personal hearing. However, the petitioner had not taken advantage of the same and thus, suffered the Impugned Order dated 27.03.2026. 2/6 https://www.mhc.tn.gov.in/judis
It is noticed that the limitation for filing an appeal under Section 107 of the respective GST enactments, 2017 against the Impugned Order has already expired. The present Writ Petition has been filed only on 13.08.2026. 5. At this stage, the learned counsel for the petitioner submits that the petitioner is willing to pre-deposit 10% of the disputed tax as a condition for de novo adjudication.
The learned counsel for the petitioner has also made an endorsement to that effect in the Court Bundle, which is extracted hereunder:-
“The petitioner is ready to pay 10% of the disputed tax.”
In view of the above, the impugned order is quashed and the case is remitted back to the respondent to pass a fresh order subject to the petitioner depositing 10% of the disputed tax in cash from the petitioner's Electronic Cash Register within a period of thirty (30) days from the date of receipt of a copy of this order. 3/6 https://www.mhc.tn.gov.in/judis
Within such time, the petitioner shall also file a reply to the Show Cause Notice in DRC 01 dated 30.09.2025 together with requisite documents to substantiate the case by treating the Impugned Order dated 27.03.2026 as an addendum to the Show Cause Notice dated 30.09.2025. 9. In case the petitioner complies with the above stipulations, the respondent shall proceed to pass a final order on merits and in accordance with law as expeditiously as possible, preferably, within a period of three (3) months of such reply / pre-deposit.
In case the petitioner fails to comply with any of the stipulations, the respondent is at liberty to proceed against the petitioner to recover the tax in accordance with law as if this Writ Petition was dismissed in limine today.
Needless to state, before passing any such order, the respondent shall give due notice to the petitioner. 4/6 https://www.mhc.tn.gov.in/judis
This Writ Petition stands disposed of, with the above observations. No costs. Consequently, connected Writ Miscellaneous Petition is closed. Index : Yes / No 17.08.2026 Internet : Yes / No apd To The Assistant Commissioner (ST), Tamilsangam Salai Assessment Circle, Madurai. 5/6 https://www.mhc.tn.gov.in/judis C.SARAVANAN, J.
apd
2026 6/6 https://www.mhc.tn.gov.in/judis
Reproduced from the public record of the Madras High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.