Tvl. A.Duraisamy vs. The Deputy State Tax Officer- 2

Facts

The petitioner, Tvl. A. Duraisamy, represented by their legal heir, filed a writ petition challenging an order of assessment dated November 3, 2025, passed by the Deputy State Tax Officer. The dispute concerns the levy of GST on seigniorage fees. The petitioner argued that this issue is pending before the Supreme Court of India and that the authorities should await its decision. The respondent contended that while proceedings were directed to be completed, any final orders were to be kept in abeyance pending the Supreme Court's judgment. The petitioner had not availed the opportunity to respond to the show cause notice or submit supporting documents.

Held

The Court held that the impugned order of assessment dated November 3, 2025, should be set aside and the matter remanded back to the respondent for fresh consideration. The petitioner was granted two weeks to file their reply with supporting documents. The respondent was directed to consider the matter afresh, but crucially, final orders were to be kept in abeyance until the Supreme Court of India pronounces its judgment on the issue of GST on seigniorage fees. If the final order resulted in tax or penalty, its enforcement and demand would also be stayed pending the Supreme Court's decision. The petitioner would be entitled to take further steps based on the Supreme Court's judgment. No costs were imposed. The Court noted that the very incidence of tax was at large, hence no deposit condition was imposed.

Key Issues

1. Whether the assessment proceedings concerning the levy of GST on seigniorage fees should be stayed pending the decision of the Supreme Court of India, as provided under Section 74 of the Tamil Nadu Goods and Services Act, 2017? The petitioner contended that the issue of GST on seigniorage fees is sub-judice before the Supreme Court and that the High Court has previously held that authorities should await the Supreme Court's decision. The respondent argued that while the High Court has directed the completion of proceedings, final orders are to be kept in abeyance until the Supreme Court's verdict, citing previous High Court orders in similar matters.