Tvl.Badrakali Amman Paul Pannai vs. The Deputy State Tax Officer-Ii/The Deputy Commercial Tax Officer

Facts

The petitioner, Tvl. Badrakali Amman Paul Pannai, represented by its President, filed a writ petition challenging an order dated 15.12.2025 passed by the Deputy State Tax Officer-II, Madurai Rural (West) Assessment Circle. This order, issued under Section 73 of the TNGST Act, 2017, was an ex-parte assessment. The petitioner contended that the assessment was made without proper opportunity, as their local counsel failed to inform them about the proceedings. The discrepancy noted by the respondent was the claim of exemption on sales turnover of milk, an exempted commodity, without filing supporting records. The petitioner argued that milk is exempted vide notification No.2/2017-Central Tax Rad, dated 28.09.2017, read with entry No.25 & 26 having HSN 0401 & 0402. The impugned order also led to the attachment of the petitioner's bank account.

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 noted that it has been extending such opportunities on equitable grounds. Consequently, the impugned order dated 15.12.2025 was set aside. The Court reasoned that since the petitioner deals in fresh milk, which is an exempted commodity, and the reason for not availing the opportunity was a failure in communication with their local counsel, it was equitable to grant a fresh opportunity. The matter was remanded back to the respondent for a fresh consideration. The Court also directed that any attachment of the bank account made pursuant to the impugned order shall stand raised. The Court did not expressly leave any issue undecided.

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 denial of adequate opportunity to the petitioner to present their case and supporting documents? (Mixed question of law and fact) The petitioner argued that the assessment order was passed ex-parte due to a communication lapse with their local counsel, who was responsible for filing returns and did not inform them of the proceedings. They contended that they had a valid defense on merits, as milk is an exempted commodity as per Notification No.2/2017-Central Tax Rad, dated 28.09.2017, read with specific HSN entries. Therefore, they sought an opportunity to present their objections and supporting documents. The respondent, represented by the Additional Government Pleader, did not explicitly record arguments in the judgment but implicitly supported the impugned order by its issuance. The judgment does not record any specific counter-arguments from the respondent regarding the petitioner's explanation for non-appearance or the merits of the exemption claim.