Tvl. Sri Mahalakshmi Traders vs. The Proper Officer / State Tax Officer
Original PDF →No AI summary yet for this judgment.
Before: and
This writ petition challenges the impugned order dated 15.12.2025 which is an assessment order passed under Section 73 of the GST Act 2017. 2.I have heard the learned counsel for the petitioner and the learned Additional Government Pleader representing the revenue. 3.By the impugned order, the assessment was made ex- parte because the petitioner did not utilise the opportunities provided. The discrepancies and grounds on which the assessment order was issued, the dealer's explanation on merits, and the reasons for not participating in the assessment 2 https://www.mhc.tn.gov.in/judis proceedings are summarised briefly and presented in a table below: Discrepancies found/grounds on which the order is passed Explanation offered by the Assessee on merits Explanation for not availing the opportunity 3 https://www.mhc.tn.gov.in/judis
ITC to be reversed on non- business transactions & exempt supplies (ii)Late fee for belated filing in form GSTR 01 & form GSTR 9/9C (iii)Penalty under Section 73 of the GST Act and interest under Section 50 of the GST Act With regard to the allegation that ITC is to be reversed on non business transaction & exempt
supplies,
the petitioner submits that during the course of business, he purchases the taxable and non-taxable goods (loose unbranded rice and millets). The exempted goods
purchased
are subsequently sold as exempt and taxable goods as taxable. Hence, there is no question of reversal input tax credit for exempt goods as no input is claimed against the exempt sales. The maintains detailed accounts from which it can be clearly ascertained the details of the taxable, non- taxable and non-GST inward
and outward supplies. Therefore, in the absence
of any misclassification,
the question of reversing the ITC by adopting the formula method as per Rule 42 and 43 of the GST Act is legally not correct. As far as levy of late fee,the petitioner submits that only due to covid pandamic there was the delay uploading and the filing the return and hence there is no need for adverse inference. In the absence of any excess claim or wrong claim the question of levy of interest under Section 50 and penalty under Section 73 of the GST Act does not arise to the facts of this cae. The Part time accountant failed to notice the fact of issuing of the proceedings uploaded in the portal by the respondent. The respondent had only chosen to upload all the communication, summons, notices and orders only on the web portal. Because of the above reasons, the respondent had issued the Ex-parte impugned order. 4 https://www.mhc.tn.gov.in/judis
Considering the nature of the discrepancies noted, the explanation provided by the assessee and the reason given before this Court for not availing the opportunity, I believe that an opportunity can be granted to the assessee to present their submissions and produce the relevant supporting documents before the respondent assessing officer. This Court has been extending such opportunities on equitable grounds; however under appropriate conditions. Therefore, an opportunity is granted to the petitioner assessee without condition. 5.In view thereof, the Writ Petition is allowed on the following terms: (i)Since 100% towards both CGST and 33% towards SGST amount had already been recovered, the impugned order dated 15.12.2025 shall stand set aside, and the matter shall stand remanded back to the file of the respondent without condition 5 https://www.mhc.tn.gov.in/judis since the commodity dealt with was unpacked rice and millets which are exempted from tax. (ii)The assessee shall appear before the respondent without fail and submit their reply and documents in support of their claim, and it is for the respondent to consider the matter afresh and pass orders in accordance with law. (iii)Since the impugned order of assessment is set aside, any attachment of the bank account made pursuant to the impugned order shall raised. (iv)No costs. Consequently, connected miscellaneous petition is closed. 23.06.2026 NCC:Yes/No Ns To 1.The Proper Officer/ State Tax Officer, Commercial Tax Building, Bodinayakanur. 6 https://www.mhc.tn.gov.in/judis D.BHARATHA CHAKRAVARTHY, J. Ns and W.M.P(MD)No.12780 of 2026 https://www.mhc.tn.gov.in/judis
2026 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.