Tvl.R.Baakiyam vs. The Deputy State Tax Officer-2

Facts

The petitioner, Tvl.R.Baakiyam, represented by its proprietor, filed a writ petition challenging an order dated 24.12.2025, passed by the Deputy State Tax Officer-2, Ambasamudram Assessment Circle. This order, issued under Section 73 of the TNGST Act, 2017, was passed ex-parte. The petitioner deals in paddy, which is an exempted good. The impugned order was passed due to the petitioner's failure to upload documents in proof of exemption and to reply to the show cause notice, attributed to personal and business circumstances. The writ petition also sought to quash the associated FORM GST DRC-07 and any bank account attachment. The tax period in dispute is 2021-2022.

Held

The Court held that an opportunity should be granted to the assessee to present their submissions and produce relevant supporting documents before the respondent assessing officer. The Court reasoned that it has been extending such opportunities on equitable grounds. Although typically 25% of the disputed tax amount is ordered to be deposited, in this case, since the petitioner deals with exempted goods, no such condition was imposed. The impugned order dated 24.12.2025 was set aside and the matter was remanded back to the respondent for reconsideration. The assessee was directed to appear before the respondent, submit their reply and documents, and the respondent was to consider the matter afresh. Consequently, any attachment of the bank account made pursuant to the impugned order was raised.

Key Issues

1. Whether the ex-parte assessment order passed under Section 73 of the TNGST Act, 2017, is liable to be quashed on the grounds of the petitioner's failure to respond to the show cause notice and upload supporting documents due to personal and business circumstances? The petitioner argued that the impugned order was passed ex-parte due to unavoidable personal and business circumstances that prevented them from responding to the show cause notice and uploading necessary documents to prove the exemption of paddy, which is their business. They contended that an opportunity should be granted to present their case and supporting evidence. The respondent, represented by the Government Standing Counsel, did not record any specific arguments against granting an opportunity to the petitioner. The Court noted the nature of discrepancies and the explanation provided by the assessee.