M Tex International vs. The State Tax Officer
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The petitioner, M.Tex International, a 100% Export Oriented Unit, filed a writ petition challenging an order dated 20.11.2025 that rejected their application under Section 128A of the TNGST Act, 2017. This rejection occurred due to the petitioner's failure to reply to a Show Cause Notice dated 18.09.2025. The petitioner contended they are not liable to pay tax on exports and that a previously granted refund was sought to be recovered via an assessment order dated 30.04.2024, with the disputed tax and interest already recovered from their Electronic Credit Ledger. The respondent argued the writ petition was meritless due to the petitioner's non-response to the Show Cause Notice.
Held
The Court held that the petitioner had wrongly invoked the jurisdiction of the authority under Section 128A of the TNGST Act, 2017. The Court reasoned that if the petitioner's case was that they were not liable to pay tax at all, they should have filed an appeal against the assessment order dated 30.04.2024. If, however, they admitted liability but failed to pay tax in time, then an application under Section 128A would have been appropriate. Since the petitioner appeared to be questioning the very basis of the demand confirmed by the assessment order under Section 73, the Court decided to dispose of the writ petition by granting the petitioner liberty to challenge the assessment order dated 30.04.2024 before the Appellate Authority under Section 107 of the Act within 30 days. The Court further directed that all recovery proceedings be kept in abeyance pending the appeal, provided the appeal is filed within the stipulated period. The Appellate Authority was directed to dispose of the appeal on merits without reference to the period of limitation. If no appeal is filed, the respondent can proceed under Section 79.
Key Issues
1. Whether the petitioner wrongly invoked the jurisdiction of the authority under Section 128A of the TNGST Act, 2017, when the challenge was to the very basis of the demand confirmed by an assessment order dated 30.04.2024 passed under Section 73 of the Act? Petitioner's contention: The petitioner argued that they are a 100% Export Oriented Unit and therefore not liable to pay tax. They also stated that the disputed tax and part of the interest liability had already been recovered. Respondent's contention: The respondent argued that the writ petition was devoid of merits because the petitioner failed to respond to the Show Cause Notice in Form SPL-03 dated 18.09.2025, and thus the petition was liable to be dismissed.
Sections Cited
Section 128A, Section 73, Section 107, Section 79
AI-generated summary — verify with the full judgment below
Cause title — parties, addresses and appearances
O R D E R The petitioner is before this Court challenging the impugned order dated 20.11.2025, whereby the petitioner's application dated 30.06.2025 under Section 128A of the TNGST Act, 2017 has been rejected, in absence of a reply to the Show Cause Notice in Form SPL-03 dated 18.09.2025. 2. The case of the petitioner is that the petitioner is a 100% Export Oriented Unit (EOU) and that the petitioner is therefore not liable to pay tax. Consequently, in respect of the exports made by the petitioner, the petitioner was rightly granted a refund, which was post facto sought to be recovered by the Assessment Order dated 30.04.2024. It is submitted that the entire disputed tax and a part of the interest liability have also been recovered.
The learned counsel for the Government of Tamil Nadu, appearing on behalf of the respondent, would submit that this Writ Petition is devoid of merits, as the petitioner failed to respond to the Show _____________ Page No. 2 of 6 https://www.mhc.tn.gov.in/judis Cause Notice in Form SPL-03 dated 18.09.2025 and therefore, this Writ Petition is liable to be dismissed.
Having considered the submissions made by the learned counsel for the petitioner and the learned counsel for the respondent, I am of the considered view that the petitioner has wrongly invoked the juri iction of the authority under Section 128A of the TNGST Act, 2017. 5. If the case of the petitioner is that the petitioner is not liable to pay tax at all, the petitioner should have filed an appeal against the order dated 30.04.2024. On the other hand, if it is the case of the petitioner that the petitioner is liable to pay tax but had failed to pay the tax in time for one reason or another, the petitioner would have been entitled to file an application under Section 128A of the TNGST Act, 2017 read with the relevant Notification issued in this regard.
From the arguments advanced before this Court, it appears that the petitioner is questioning the very basis of the demand confirmed against the petitioner. It is noticed that an assessment order dated 30.04.2024 was passed under Section 73 of the Act. _____________ Page No. 3 of 6 https://www.mhc.tn.gov.in/judis
Considering the fact that the disputed tax has already been recovered from the petitioner's Electronic Credit Ledger, I am inclined to dispose of this Writ Petition by granting liberty to the petitioner to challenge the assessment order dated 30.04.2024 before the Appellate Authority under Section 107 of the Act within a period of 30 days from the date of receipt of a copy of this order.
Considering the fact that the entire disputed tax has already been recovered, all further recovery proceedings shall be kept in abeyance pending disposal of the appeal, provided the petitioner files the appeal against the assessment order dated 30.04.2024 within the aforesaid period. It is made clear that if the petitioner files the appeal within the said period, the Appellate Authority shall dispose of the appeal on merits without reference to the period of limitation. In case the petitioner fails to file such an appeal within the said period, the respondent is at liberty to proceed against the petitioner under Section 79 of the respective GST Enactments, as if this Writ Petition stood dismissed in limine by this order.
With the above observations, this Writ Petition is disposed of. There shall be no order as costs. Consequently, the connected _____________ Page No. 4 of 6 https://www.mhc.tn.gov.in/judis Miscellaneous Petition is closed. 20.07.2026 JEN NCC : Yes / No Index : Yes / No To The State Tax Officer, Karur - 3 Assessment Circle, Karur. _____________ Page No. 5 of 6 https://www.mhc.tn.gov.in/judis C.SARAVANAN, J. JEN
2026 _____________ Page No. 6 of 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.