Tvl.Sivasakthi Material Suppliers vs. The Deputy Commercial Tax Officer

The learned counsel appearing for the petitioner would submit that, firstly, the respondents have relied upon certain transactions as reflected in third parties’ accounts and have fastened the liability upon the petitioner. The petitioner is a person dealing in gravel and sand at Tenkasi, and there is no possibility of the petitioner having dealt with persons located at Chennai. The petitioner completely denies those transactions. In such cases, this Court, in JKM Graphics Solution P Ltd 2 https://www.mhc.tn.gov.in/judis vs. CTO, Vepery Assessment Circle, Chennai, has already held that the respondent authority should evolve a centralized mechanism to ascertain whose version is correct and whose version is false, and should not unilaterally decide the issue.

This Court further observed that the mechanism contained in the Maharashtra VAT Act, whereby both parties are confronted in order to arrive at the truth, was a better mechanism. However, in view of the advent of the Tamil Nadu Goods and Services Tax Act, 2017, the directions issued by the Court were never implemented. Nevertheless, in the petitioner’s case, it was necessary for the respondents to have adopted such a course of action.

Per contra, the learned Additional Government Pleader would submit that, if the petitioner claims that no such transactions had taken place, it was incumbent upon the petitioner to satisfy the authority that no such transaction had ever occurred. In any event, the impugned order was passed in the year 2023, whereas the petitioner has approached this Court only now. 3 https://www.mhc.tn.gov.in/judis

I have considered the rival submissions made on either side and perused the material records of the case.

If the petitioner’s case is that no transaction had ever taken cross-examining the other dealer or by demonstrating before the authority that such transactions could not have taken place, can be adopted. It is also open to the petitioner to raise the issue of limitation.

In view thereof, I am of the opinion that the petitioner may be granted one further opportunity. Normally, this Court grants such opportunity subject to the condition of depositing 25% of the disputed tax amount. 4 https://www.mhc.tn.gov.in/judis

In this case, it is stated that the petitioner has closed down its business long back and in view thereof, this writ petition is ordered on the following terms:- i. Within a period of four weeks from the date of receipt of a web copy of this order, the petitioner shall deposit 15% of the disputed tax amount; ii. Upon such deposit, the impugned order dated 19.01.2023 shall stand set aside, and the matter shall stand remanded to the file of the respondent for fresh consideration; iii. It shall be open to the petitioner to file such additional replies and documents as may be required, and also to file appropriate applications for summoning the invoices relied upon in the impugned order and for confronting the concerned supplier by way of cross-examination; 5 https://www.mhc.tn.gov.in/judis iv. It shall also be open to the petitioner to otherwise demonstrate that the transaction had never taken place; v. With the above liberty reserved to the petitioner to undertake the aforesaid course during the hearing, it is for the respondent authority to pass orders in the manner known to law; vi. No costs. Consequently, connected miscellaneous petition is closed. 21.04.2026 (1/2) Neutral Citation: No rgm 6 https://www.mhc.tn.gov.in/judis To The Deputy Commercial Tax Officer, Tenkasi -1 Assessment Circle, Commercial Tax Building, Tenkasi. 7 https://www.mhc.tn.gov.in/judis D.BHARATHA CHAKRAVARTHY