Tvl. A.K.Hollow Bricks And Interlocks vs. The State Tax Officer (Adjudication And Legal)/
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The petitioner, Tvl. A.K. Hollow Bricks and Interlocks, represented by its Proprietor Manoj, filed a writ petition challenging an assessment order dated 08.01.2026, passed by the respondent, The State Tax Officer (Adjudication and Legal). This order followed an inspection under Section 67 of the GST enactment. The petitioner failed to provide particulars requested during the inspection and did not reply to a show cause notice issued on 23.04.2025. However, the petitioner claimed to have discharged the tax liability during the inspection, which was appropriated in the impugned order. The petitioner sought to quash the assessment order and requested a redo of the assessment proceedings for the year 2022-23.
Held
The Court decided to remit the case back to the respondent for a fresh assessment. The reasoning was based on the petitioner's submission that they were engaged in transportation of goods with an exempted turnover, and the fact that no reply was filed to the show cause notice. The Court treated the impugned order dated 08.01.2026 as an addendum to the show cause notice dated 23.04.2025. The ratio decidendi is that where a taxpayer claims a specific exemption and has discharged some liability, and has not responded to a show cause notice, a reasonable opportunity to explain their position should be granted before finalizing the assessment. The operative direction is to allow the petitioner to file a reply to the show cause notice within 30 days of receiving the order. The respondent is then to pass fresh orders on merits after hearing the petitioner, preferably within three months. If the petitioner fails to comply, the respondent can proceed as if the writ petition was dismissed.
Key Issues
1. Whether the petitioner should be granted an opportunity to explain their business activities and tax liability, particularly concerning the transportation of goods and claimed exemptions under a specific notification where tax is payable by the recipient? The petitioner argued that they were engaged in the transportation of goods and that their entire business turnover was exempted as per a notification, with the tax liability resting on the recipient. They requested one opportunity to present this explanation. The respondent, represented by the State of Tamil Nadu, did not explicitly record arguments but noted that no reply was filed by the petitioner to the show cause notice. The court observed that the tax demanded had been confirmed.
Sections Cited
Section 67
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Before: and
Mr.S.Venkatesh, learned counsel for the State of Tamil Nadu, takes notice for the respondent. 2.By consent, this writ petition is disposed of at the time of admission after hearing the learned counsel for the State of Tamil Nadu appearing for the petitioner and the learned counsel for the respondent. 3.The petitioner has challenged the impugned order passed by the respondent bearing Ref.No.GSTIN:33CHWPM6631C1Z7/2022-23 and in summary order Ref.No.ZD330126047305R dated 08.01.2026, which has preceded an inspection under Section 67 of the respective GST enactment, for which, the petitioner failed to respond to give particulars called for during the course of inspection. 4.The petitioner was issued with the show cause notice in GST DRC 01, dated 23.04.2025, which was also not replied to. However, it is noticed that during the course of inspection, the petitioner has already discharged the tax liability, which has also been appropriated in the impugned order. 2/5 https://www.mhc.tn.gov.in/judis
The learned counsel for the petitioner submits that the petitioner may be given one opportunity to explain that the petitioner was engaged in transportation of goods and that the entire business turnover was exempted in terms of the notification as tax was to be paid by the recipient. 6.Having considered the submissions made by the learned counsel for the petitioner and the learned counsel for the State of Tamil Nadu appearing for the respondent, taking note of the fact that the tax demanded has been confirmed and considering the fact that no reply was filed, this Court is inclined to remit the case back to the respondent to pass a fresh order in lieu of the impugned order, subject to the petitioner filing a reply to the show cause notice issued in GST DRC 01 dated 23.04.2025 by treating the impugned order dated 08.01.2026 as an addendum to the show cause notice dated 23.04.2025, within a period of 30 days from the date of receipt of a copy of this order. 7.In case the petitioner complies with the above stipulation, the respondent shall proceed to pass fresh orders on merits and in accordance with law as expeditiously as possible preferably within a period of three (3) months thereafter, after hearing the petitioner. 3/5 https://www.mhc.tn.gov.in/judis
In case the petitioner fails to comply with the condition stipulated above, the respondent is at liberty to proceed against the petitioner in accordance with law as if this Writ Petition was dismissed in limine today. 9.It is made clear that the petitioner shall cooperate with the respondent and furnish all the documents including the reply within the time stipulated above to substantiate their case. 10.This Writ Petition is disposed of, with the above observations. No costs. Consequently, connected Miscellaneous Petition is closed. Index : Yes / No 16.07.2026 Internet : Yes / No mm To The State Tax Officer (Adjudication and Legal)/ The Commercial Tax Officer O/o.The Joint Commissioner (ST) (Intelligence) Tirunelveli Intelligence Division Tirunelveli. 4/5 https://www.mhc.tn.gov.in/judis C.SARAVANAN, J.
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2026 5/5 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.