Tvl. Shalom Associates vs. The State Tax Officer
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The petitioner, Tvl. Shalom Associates, a registered taxpayer under GST, challenged an assessment order dated 13.12.2023 passed by the State Tax Officer (first respondent) and a consequential appeal rejection order dated 22.06.2024 passed by the Deputy Commissioner (GST Appeal) (second respondent). The petitioner claimed to have been unaware of the proceedings, stating their accountant informed them that tax was recovered without notice. Upon inquiry, they learned notices and the order were uploaded to the common portal. The petitioner filed an appeal on 24.05.2024, which was rejected by the second respondent due to delay. The petitioner contends that the first respondent passed an ex parte order without adjudication, violating principles of natural justice, and the second respondent rejected the appeal on limitation without considering the delay's cause.
Held
The Court quashed the impugned orders and remitted the case back to the first respondent for a fresh order. The petitioner was directed to file a reply to the Show Cause Notice dated 24.09.2023, along with supporting documents, within thirty days, treating the assessment order dated 13.12.2023 as an addendum to the Show Cause Notice. If the petitioner complied, the first respondent was to pass a final order on merits within six weeks. The Court emphasized that before passing any order, the first respondent must provide due notice to the petitioner. If the petitioner failed to comply with the stipulations, the respondents were at liberty to proceed with recovery as if the writ petition was dismissed. The Court found that the initial ex parte order and subsequent rejection of appeal on limitation grounds, without addressing the petitioner's grievance of non-compliance with natural justice, warranted interference.
Key Issues
1. Whether the ex parte assessment order passed by the first respondent, without providing an opportunity to the petitioner, violates the principles of natural justice, and consequently, whether the rejection of the appeal by the second respondent on grounds of limitation is sustainable? Petitioner's arguments: The petitioner argued that the first respondent passed an ex parte order without any adjudication and without providing an opportunity to be heard, thus violating the principles of natural justice. They further contended that the second respondent rejected their appeal solely on the ground of limitation, failing to consider the circumstances leading to the delay and the initial violation of natural justice by the first respondent. Respondents' arguments: The respondents argued that the petitioner received a Show Cause Notice from the first respondent but neither appeared nor submitted any explanation, leading to the ex parte order. They also stated that the appeal filed before the second respondent was delayed, and since the second respondent has no power to condone such delay, the appeal was rightly rejected.
Sections Cited
Section 73, Section 129
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Before: and
Mr.R.Parthiban, learned Counsel for State of TN takes notice for the respondents.
This Writ Petition is being disposed of at the time of admission with the consent of the learned counsel for the Petitioner and the learned Counsel for State of TN for the respondents.
In this Writ Petition, the Petitioner has challenged the impugned Assessment Order in Form GST DRC 07 in GSTIN. 33AORPR4479K1Z3/2017-2018 dated 13.12.2023 of the first respondent, along with the consequential Appeal Rejection Order in Form GST Apl 02 dated 22.06.2024 of the second respondent. 2/7 https://www.mhc.tn.gov.in/judis
The facts of the case are that the petitioner is doing business and the petitioner is the registered tax payer under GST. The petitioner entirely depend upon his part-time Accountant. However, recently, the petitioner’s Accountant informed the petitioner that the entire tax amount was recovered by the respondents pursuant to the Impugned Orders without any notice. When the petitioner contacted the respondents, he came to know that the notices that preceded the Impugned Order as also the Impugned Order were also uploaded in the common portal. Aggrieved by the same, the petitioner filed an appeal on 24.05.2024 before the second respondent. However, the same was rejected on 22.06.2024 on the ground that there is a delay in submission of appeal. Challenging the same, this Writ Petition has been filed.
The learned counsel for the petitioner would submit that originally, the first respondent, without conducting any adjudication, passed an ex parte order. As against the same, when the petitioner preferred an appeal before the second respondent, the second respondent has rejected the same on the ground of limitation. Hence, there is a violation of principles of natural justice, as without providing an opportunity to the petitioner, the first respondent has passed the 3/7 https://www.mhc.tn.gov.in/judis Impugned Order. Hence, he prayed to allow this Writ Petition.
Per contra, the learned Counsel for State of TN for the respondents would submit that having received the Show Cause Notice from the first respondent, the petitioner neither appeared before the first respondent nor submitted any explanation and thereby the ex parte order was passed. As against the ex parte order, the petitioner filed an appeal before the second respondent with a delay. Since the second respondent has no power to condone the delay, rejected the appeal. Hence, he prayed to dismiss this Writ Petition.
In view of the above, the impugned orders are quashed and the case is remitted back to the first respondent to pass a fresh order.
The petitioner shall also file a reply to the Show Cause Notice in DRC 01 dated 24.09.2023 together with requisite documents to substantiate the case by treating the Impugned Order dated 13.12.2023 as an addendum to the Show Cause Notice dated 24.09.2023 within a period of thirty (30) days from the date of receipt of a copy of this order. 4/7 https://www.mhc.tn.gov.in/judis
In case the petitioner complies with the above stipulations, the first respondent shall proceed to pass a final order on merits and in accordance with law as expeditiously as possible, preferably, within a period of six (6) weeks of such reply.
In case the petitioner fails to comply with any of the stipulations, the respondents are at liberty to proceed against the petitioner to recover the tax, if any, in accordance with law as if this Writ Petition was dismissed in limine today.
Needless to state, before passing any such order, the first respondent shall give due notice to the petitioner.
This Writ Petition stands allowed with the above observations. No costs. Connected Writ Miscellaneous Petition is closed. Index : Yes / No 22.07.2026 Internet : Yes / No apd 5/7 https://www.mhc.tn.gov.in/judis To
The State Tax Officer, Nagercoil (Rural) Assessment Circle, Kanniyakumari District.
The Deputy Commissioner (C), GST Appeal, Tirunelveli. 6/7 https://www.mhc.tn.gov.in/judis M.DHANDAPANI, J.
apd
2026 7/7 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.