T. Soundarraj vs. The Deputy Commercial Tax Officer

Facts

The petitioner, T. Sundarraj, filed a writ petition before the Madurai Bench of the Madras High Court challenging an order dated 23.07.2024, issued by the Deputy Commercial Tax Officer, Karur-1. The respondents are various tax authorities. The petitioner sought to quash the impugned order, alleging it was illegal. The primary ground for challenge was that the order was passed without providing any reasons, contrary to the requirements of Section 73 of the Tamil Nadu Goods and Services Tax Act, 2017, and also in violation of Circular No.8/2024 issued by the Commissioner, State Tax.

Held

The Court held that the impugned order dated 23.07.2024, passed by the first respondent, was liable to be interfered with. The primary reasoning was that the order had been passed without providing any reasons whatsoever, which is a mandatory requirement under Section 73 of the Tamil Nadu Goods and Services Tax Act, 2017. Additionally, the Court noted that the order also failed to comply with the guidelines issued by the Commissioner, State Tax, in Circular No.8/2024. The ratio decidendi is that an order passed without reasons, violating statutory provisions and departmental circulars, is unsustainable. Consequently, the Writ Petition was allowed, and the impugned order was set aside. The petitioner was directed to appear before the first respondent on 19.02.2025 to submit a detailed explanation along with relevant documents. The first respondent was then directed to pass a reasoned order on merits and in accordance with law after hearing the petitioner.

Key Issues

1. Whether the order dated 23.07.2024, passed by the first respondent, is liable to be set aside for non-compliance with the requirement of providing reasons as contemplated under Section 73 of the Tamil Nadu Goods and Services Tax Act, 2017. 2. Whether the impugned order is liable to be set aside for non-compliance with the guidelines issued by the Commissioner, State Tax, in Circular No.8/2024, dated 29.08.2024. The petitioner argued that the order suffered from a lack of reasons, which is a mandatory requirement under Section 73 of the TNGST Act, 2017. Furthermore, the petitioner contended that the order also failed to adhere to the procedural guidelines laid down in Circular No.8/2024. The respondents did not record any specific arguments in the judgment.