Tvl. New Krishna Sweets Bakery vs. State Tax Officer (St)

Facts

The petitioner, Tvl. New Krishna Sweets Bakery, filed a writ petition challenging an order dated 11.11.2025 passed by the State Tax Officer, Thanjavur. This order confirmed a proposal in a show cause notice dated 23.08.2025 for the tax period April 2021 to March 2022, under Section 73 of the GST enactment, without the petitioner filing a reply. The petitioner claimed to have paid Rs.1,44,838/- on 03.02.2023 towards the tax liability. The respondent was unable to confirm if this payment related to voluntary payment under Section 73(5). The petitioner also undertook to deposit 25% of the disputed tax for de novo adjudication. The court also noted a bank attachment order dated 27.05.2026.

Held

The Court held that the impugned order dated 11.11.2025 was passed without a reply from the petitioner, thus violating principles of natural justice. Consequently, the Court decided to remit the case back to the respondent for a fresh adjudication. This decision is subject to the petitioner depositing 25% of the disputed tax in cash from their Electronic Cash Register within thirty days of receiving the order. The petitioner is also required to file a reply to the show cause notice dated 23.08.2025 within the same period, treating the impugned order as an addendum. Any amount already paid by the petitioner will be adjusted towards this pre-deposit, subject to verification. If the petitioner complies, the respondent shall pass a final order on merits within three months. Upon compliance, the bank attachment shall stand automatically vacated, provided the petitioner has no other arrears. Failure to comply will allow the respondent to proceed with recovery as if the writ petition was dismissed.

Key Issues

1. Whether the impugned order dated 11.11.2025, passed under Section 73 of the GST enactment, is liable to be quashed for being passed without considering the petitioner's reply and for violating principles of natural justice? 2. Whether the bank attachment dated 27.05.2026 is arbitrary and illegal, especially in light of the petitioner's claim of payment and willingness to deposit a pre-deposit? Petitioner's arguments: The petitioner contended that the impugned order was passed arbitrarily without considering their reply and thus violated principles of natural justice. They also highlighted a payment made on 03.02.2023 and their willingness to deposit 25% of the disputed tax as a condition for fresh adjudication. They sought to quash the impugned order and lift the bank attachment. Respondent's arguments: The respondent, represented by the State Tax Officer, was unable to confirm the nature of the payment made by the petitioner. No other specific arguments were recorded for the respondent.