S.R. Agencies vs. The Deputy State Tax Officer - 1(Fac)

Facts

The petitioner, S.R. Agencies, represented by its proprietor, is engaged in the business of selling petrol and diesel, which are goods exempted from tax. The petitioner received an assessment order dated 03.12.2025 from the Deputy State Tax Officer (1st Respondent) under Section 73 of the TNGST Act, 2017. This order was passed ex-parte on the grounds that the petitioner failed to upload documents to prove the exemption. The petitioner claims that due to personal and business circumstances, they missed the opportunity to reply to the show cause notice and upload the necessary documents. The writ petition was filed before the Madurai Bench of the Madras High Court challenging this order.

Held

The Court held that the impugned order dated 03.12.2025, passed ex-parte by the 1st Respondent, is set aside. The Court reasoned that in such cases, it is appropriate to grant the petitioner an opportunity to appear before the authority and present their documents and reply. The Court noted that the petitioner is within the time limit to file an appeal and that their business involves tax-exempt petroleum products. Therefore, the Court decided to remand the matter back to the respondent authority for reconsideration. The Court also directed that any attachment of the bank account made pursuant to the impugned order shall stand raised. The petitioner was directed to cooperate for the expeditious determination of the assessment proceedings. The Court did not impose the usual condition of depositing 25% of the disputed amount due to the special and peculiar circumstances.

Key Issues

1. Whether the ex-parte assessment order passed by the 1st Respondent under Section 73 of the TNGST Act, 2017, is liable to be quashed on the grounds of the petitioner's failure to respond due to personal and business circumstances? Petitioner's arguments: The petitioner contended that the ex-parte order was passed due to their inability to respond to the show cause notice and upload supporting documents owing to personal and business exigencies. They sought an opportunity to present their case and documents to the authority. The petitioner also highlighted that their business involves selling petroleum products, which are exempted from tax. Revenue's arguments: The judgment does not record any specific arguments made by the respondent revenue authority. However, the impugned order was passed by the respondent authority, indicating their initial stance on the matter.