Somu Jothibasu vs. The Principal Commissioner

Facts

The petitioner, Somu Jothibasu, filed a writ petition before the Madurai Bench of the Madras High Court challenging an order passed by the second respondent, the Commercial Tax Officer, Aranthangi Assessment Circle. The impugned order, dated 03.09.2025, was issued in FORM GST DRC-07 under Section 74 of the GST enactments for the Financial Year 2023-24. The petitioner contended that the order was passed without a proper reply to the preceding show cause notice. The respondents, represented by the Counsel for State of TN, had no objection to the case being remitted for fresh adjudication.

Held

The Court quashed the impugned order dated 03.09.2025, subject to the petitioner depositing 25% of the disputed tax in cash within thirty days of receiving a copy of the order. The Court directed the petitioner to file a reply to the notice preceding the impugned order, treating the impugned order as an addendum to the Show Cause Notice. If these conditions were met, the second respondent was to proceed with passing fresh orders on merits and in accordance with law, preferably within three months after hearing the petitioner. The Court noted that if the petitioner failed to comply with any of the stipulations, the respondents were at liberty to proceed as if the writ petition was dismissed. The issue of the validity of the original assessment, beyond the procedural defect, was not decided.

Key Issues

1. Whether the impugned order passed by the second respondent under Section 74 of the GST enactments, 2017, is liable to be quashed due to being passed without a reply to the show cause notice? (Question of law) Petitioner's contention: The petitioner argued that the impugned order was passed without addressing their reply to the show cause notice, rendering it illegal. They offered to deposit 25% of the disputed tax in cash as a condition for de novo adjudication. Revenue's contention: The learned Counsel for State of TN for the respondents stated they had no objection to the case being remitted back to the second respondent to pass a fresh order in lieu of the impugned order.