Tvl Jeyalakshmi vs. The State Tax Officer (Intelligence)

Facts

The petitioner, Tvl. Jeyalakshmi, filed a writ petition challenging an assessment order dated 24.11.2025 passed by the respondent, The State Tax Officer (Intelligence), Madurai. The order was passed under Section 73 of the TNGST Act, 2017, for the financial year 2020-2021. The assessment was made ex-parte because the petitioner did not utilize the opportunities provided. The respondent alleged that the petitioner conducted business as an unregistered person despite being liable for registration and did not file a reply. The petitioner contended that notices were only uploaded on the online portal and were not communicated effectively, leading to their unawareness and inability to file a reply due to technical issues. The impugned order levied tax, interest, and penalty.

Held

The Court held that an opportunity should be granted to the assessee to present their submissions and produce supporting documents before the assessing officer, considering the nature of the discrepancies, the explanation provided by the assessee, and the reasons given for not availing the opportunity. The Court reasoned that such opportunities are extended on equitable grounds, subject to appropriate conditions. Therefore, the petitioner was granted an opportunity to respond on the condition of depositing 25% of the disputed tax amount. The impugned order dated 24.11.2025 was set aside, and the matter was remanded back to the respondent for fresh consideration. The Court also directed that any bank account attachment made pursuant to the impugned order shall stand raised. The ratio decidendi is that principles of natural justice require adequate opportunity to be heard, and where there are plausible reasons for non-compliance, especially due to technical glitches or communication failures in online systems, an opportunity to rectify the situation should be provided, albeit with a financial safeguard.

Key Issues

1. Whether the ex-parte assessment order passed under Section 73 of the TNGST Act, 2017, is sustainable when the petitioner claims non-receipt of proper notices due to online portal upload issues and technical difficulties in responding. Petitioner's arguments: The petitioner argued that all notices were uploaded solely on the online portal, which was primarily accessed by their auditor. These notices were not effectively communicated to the petitioner, and they were unaware of the proceedings. Furthermore, they faced technical difficulties in uploading replies to the portal. Consequently, they could not file a response to the notices, leading to an ex-parte order without considering their explanation. The respondent did not send notices through any other mode. Respondent's arguments: The respondent did not record any specific arguments in the judgment regarding the petitioner's claims of non-receipt of notices or technical difficulties. The judgment indicates that the assessment was made ex-parte because the petitioner did not utilize the opportunities provided.