Tvl. Madhura A Electrikals vs. The Deputy State Tax Officer - 2

Facts

The petitioner, Tvl. Madhura A Electrikals, filed a writ petition challenging an order dated 02.12.2025 passed by the Deputy State Tax Officer - 2, Karur. This order was passed under Section 73 of the TNGST Act, 2017, for the tax period 2021-22. The petitioner's appeal against this order to the Appellate Commissioner was rejected on 06.05.2026 as it was filed beyond the period of limitation. The petitioner had failed to respond to the show cause notice dated 25.08.2025. The petitioner expressed willingness to deposit 15% of the disputed tax, and had already paid 10% at the time of filing the appeal. The respondent State had no objection to the case being remitted back for a fresh order.

Held

The Court quashed the impugned order dated 02.12.2025, subject to the petitioner depositing 15% 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 that preceded the impugned assessment order, treating the impugned order as an addendum to the Show Cause Notice. If the petitioner complied with these conditions, the respondent was directed to pass fresh orders on merits and in accordance with law, preferably within three months thereafter, after hearing the petitioner. The Court noted that if the petitioner failed to comply with any of the conditions, the respondents were at liberty to proceed against the petitioner as if the writ petition was dismissed in limine. The ratio decidendi is that when parties agree to a remand and the petitioner undertakes to comply with certain conditions, including a partial deposit of disputed tax, the High Court can quash the impugned order and direct a fresh assessment to ensure compliance with principles of natural justice and procedural fairness, provided the statutory limitations for passing such orders are not irrevocably breached.

Key Issues

1. Whether the impugned order dated 02.12.2025, passed by the respondent under Section 73 of the TNGST Act, 2017, is liable to be quashed as cryptic, non-speaking, barred by limitation, illegal, arbitrary, and without jurisdiction, requiring the respondent to pass a fresh assessment order? Petitioner's Contention: The petitioner argued that the impugned order was flawed and sought its quashing. They were prepared for the case to be remanded back to the respondent for a fresh order. The petitioner undertook to deposit 15% of the disputed tax from the cash ledger, having already paid 10% of the disputed tax at the time of filing the appeal. The petitioner's counsel made an endorsement to this effect. Respondent's Contention: The learned Counsel for the State of Tamil Nadu had no objection to remitting the case back to the respondent to pass a fresh order in lieu of the impugned order.