M/S. Aswath Industries vs. The State Tax Officer
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Before: and
This Writ Petition has been filed seeking to quash the impugned order dated 29.12.2025. 2. The learned counsel for the petitioner would submit that the petitioner is engaged in the supply of exempted goods, namely, rice falling under HSN 1006 and animal feed concentrates falling under HSN 23099020. It is submitted that though a show cause notice in Form GST DRC-01 dated 25.09.2025 was issued, the petitioner could not submit a reply since she had entrusted the GST compliance to a part-time accountant, who failed to notice the notice and the subsequent proceedings uploaded on the GST portal. Consequently, the impugned order dated 29.12.2025 came to be passed without affording the petitioner an effective opportunity of hearing. It is further submitted that the petitioner came to know about the assessment only when recovery proceedings were initiated on 29.06.2026. 3. On merits, the learned counsel would contend that the turnover relates exclusively to exempted supplies and that the respondent had already reversed the input tax credit under Rules 42 and 43 in an earlier DRC-07 order, and therefore, the subsequent denial of exemption results in partial double taxation. It is further contended that the levy of interest under Section 50 and penalty https://www.mhc.tn.gov.in/judis __________ Page3 of 5 under Section 73 of the GST Act is wholly unsustainable. Hence, the impugned order, having been passed in violation of the principles of natural justice, is liable to be set aside.
The learned Standing Counsel appearing for the respondent would submit that the show cause notice and all subsequent communications were duly uploaded on the GST portal in the manner prescribed under the GST Act and Rules. It is submitted that the petitioner failed to respond to the notice within the stipulated time, and therefore, the respondent was constrained to complete the assessment based on the materials available on record.
Considering the facts and circumstances of the case, this Court is of the view that the impugned order has been passed without affording the petitioner an effective opportunity of hearing and is, therefore, in violation of the principles of natural justice. Accordingly, the impugned order dated 29.12.2025 is set aside and the matter is remitted back to the respondent for fresh consideration.
The petitioner shall submit her reply together with all supporting documents within two weeks from the date of receipt of a copy of this order. On receipt of the same, the respondent shall afford the petitioner a reasonable opportunity of personal hearing and thereafter, pass fresh orders on merits and in accordance with law, within a period of four weeks thereafter. https://www.mhc.tn.gov.in/judis __________ Page4 of 5
With the above directions, the Writ Petition stands disposed of. There shall be no order as to costs. Consequently, connected miscellaneous petition is closed. 22-07-2026 Index: Yes/No Speaking/Non-speaking order (1/2) Neutral Citation: Yes/No smn2 To The State Tax Officer Kamarajar Salai Assessment Circle, Madurai. https://www.mhc.tn.gov.in/judis __________ Page5 of 5 M.DHANDAPANI, J. smn2 22-07-2026 (1/2) 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.