M/S.A.S.Milk Agency vs. The Deputy State Tax Officer-1

Facts

The petitioner, M/s. A.S. Milk Agency, represented by its Proprietor T. Arpudharaj, filed a Writ Petition before the Madurai Bench of the Madras High Court challenging an order dated 26.12.2025 issued by the Deputy State Tax Officer-1. This order was passed under Section 73 of the GST enactments for the tax period 2021-22, following a Show Cause Notice dated 05.08.2025. The petitioner had not availed the opportunity for a personal hearing and consequently suffered the impugned order. The Writ Petition was filed on 24.07.2026, after the limitation period for filing an appeal under Section 107 of the GST enactments had expired.

Held

The Court quashed the impugned order dated 26.12.2025. The case was remitted back to the respondent for de novo adjudication. This decision was made conditional upon the petitioner depositing 25% of the disputed tax in cash from their Electronic Cash Register within thirty days of receiving a copy of the order. Additionally, the petitioner was directed to file a reply to the Show Cause Notice dated 05.08.2025, along with supporting documents, within the same period. The impugned order was to be treated as an addendum to the Show Cause Notice. The respondent was instructed to pass a fresh order on merits and in accordance with law expeditiously, preferably within three months of the petitioner's compliance. The Court also stipulated that if the petitioner failed to comply with any of the conditions, the respondent would be 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. No issue was expressly left undecided.

Key Issues

1. Whether the impugned order dated 26.12.2025, passed under Section 73 of the GST enactments, is liable to be quashed for being without jurisdiction and in violation of statutory provisions? Petitioner's contention: The petitioner argued that the impugned order was passed without jurisdiction and in clear violation of statutory provisions. The petitioner expressed willingness to pre-deposit 25% of the disputed tax as a condition for de novo adjudication, indicating a procedural challenge rather than a substantive one on merits at this stage. The petitioner made an endorsement undertaking to pay 25% of the disputed tax. Respondent's contention: The respondent, represented by the Counsel for the State of TN, took notice of the petition. No specific arguments were recorded in the judgment regarding the respondent's defense against the petitioner's claims, other than their appearance and representation.