Arul Agencies vs. The Appellate Deputy Commissioner(GST)

Facts

The petitioner, Arul Agencies, filed a writ petition before the Madurai Bench of the Madras High Court challenging an order dated February 22, 2024, passed by the Commercial Tax Officer/State Tax Officer, Tuticorin-I. This order was issued for the tax period April 2019 to March 2020. The impugned order followed a show cause notice dated September 22, 2023, and subsequent reminders. The petitioner failed to file any reply or appear for personal hearings, leading to the ex-parte order. During the court hearing, the petitioner expressed willingness to pre-deposit 50% of the disputed tax amount to facilitate a fresh adjudication.

Held

The Court quashed the impugned order dated February 22, 2024, passed by the second respondent. The case was remitted back to the second respondent for passing a fresh order. This remittance is conditional upon the petitioner depositing 50% of the disputed tax in cash from their electronic cash register within 30 days of receiving a copy of the order. Additionally, the petitioner must file a reply to the show cause notice dated September 22, 2023, along with supporting documents, within the same period, treating the impugned order as an addendum to the show cause notice. If these conditions are met, the second respondent is to pass a final order on merits expeditiously, preferably within three months. The attachment of the petitioner's bank account, if any, will be automatically vacated upon compliance. The Court clarified that if the petitioner fails to comply with any stipulation, the second respondent can proceed to recover the tax as if the writ petition was dismissed. The second respondent must issue due notice before passing any fresh order. No issue was expressly left undecided.

Key Issues

1. Whether the impugned order dated February 22, 2024, passed by the second respondent (Commercial Tax Officer/State Tax Officer) is illegal, arbitrary, and contrary to law, warranting quashing and remittance for reconsideration? Petitioner's contention: The petitioner argued that the impugned order should be quashed and the matter remitted back to the second respondent for fresh adjudication. To support this, the petitioner expressed willingness to pre-deposit 50% of the disputed tax amount. This willingness was formally endorsed in the court bundle, praying for the quashing of the order and remittance. Revenue's contention: The judgment records that the learned counsel for the State of Tamil Nadu took notice for the respondents. No specific arguments were recorded for the revenue, other than their counsel appearing and taking notice. The court proceeded to dispose of the writ petition by consent.