Tvl Chellam Motors Private Limited vs. The State Tax Officer - V (Roving Squad)
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The petitioner, Tvl. Chellam Motors Private Limited, filed a writ petition challenging an assessment order for the year 2017-18, issued by the 1st respondent (The State Tax Officer-V), and a consequential Form GST DRC-07 issued by the 2nd respondent (The Commercial Tax Officer). The petitioner contended that the assessment order was arbitrary, void, and contrary to statutory provisions and a circular. The impugned order was dated 25.10.2024, and the Form GST DRC-07 was also dated 25.10.2024. The writ petition was filed under Article 226 of the Constitution of India.
Held
The Court held that the impugned order suffered from the vice of arbitrariness because the Assessing Officer had neither made a determination of the tax payable by the petitioner as envisaged under Section 74 of the Tamil Nadu Goods and Services Tax Act, 2017, nor followed the guidelines issued in Circular No. 8/2024 dated 29.08.2024. The Court found that these procedural lapses rendered the order liable to interference. Consequently, the writ petition was allowed, the impugned order was set aside, and the matter was remitted back to the first respondent for fresh consideration. The petitioner was directed to file a reply with supporting documents within two weeks, after which the first respondent was to provide a hearing and pass a reasoned order on merits within eight weeks. No issue was expressly left undecided.
Key Issues
1. Whether the Assessing Officer followed the mandatory procedure under Section 74 of the Tamil Nadu Goods and Services Tax Act, 2017, for determining the tax payable by the petitioner? 2. Whether the Assessing Officer adhered to the guidelines stipulated in Circular No. 8/2024, dated 29.08.2024, issued by the Commissioner of State Tax? Petitioner's arguments: The petitioner argued that the Assessing Officer failed to invoke Section 74 of the Act, which requires a determination of the proposal made in the show cause notice. Furthermore, the petitioner contended that the Assessing Officer did not follow the procedural guidelines laid down in Circular No. 8/2024. The petitioner asserted that the impugned order was arbitrary and violative of constitutional provisions. Revenue's arguments: The judgment does not record any specific arguments made by the respondents (State Tax Officer and Commercial Tax Officer).
Sections Cited
Section 74, Section 168A
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Before: and
The challenge in the writ petition is to the assessment order of the year 2017-18. 2. The Primordial contention of the learned counsel for the petitioner is that neither the provisions of Section 74 of the Tamil Nadu Goods and Services Tax Act, 2017 (hereinafter referred to as “the Act”) which envisages a determination by the Assessing Officer of the proposal made under the show cause notice has been invoked, nor the circular issued by the Commissioner, State Tax, Commercial Taxes Department, _________ https://www.mhc.tn.gov.in/judis Ezhilagam, Chennai, in Circular No.8/2024, dated 29.08.2024 has been followed by the Assessing Officer while issuing the order of demand.
A perusal of the order impugned herein would also show that the Assessing Officer had not made any determination of the tax payable by the petitioner as envisaged under Section 74 of the Act, nor has followed the guidelines issued in Circular dated 29.08.2024 of the Commissioner of State Tax. In such view of the matter, I am of the view that the order impugned suffers from vice of arbitrariness. For the said reason, the order impugned is liable to be interfered with.
In fine, this Writ Petition is allowed, the impugned order is set aside and the matter is remitted back to the first respondent for fresh consideration. The petitioner shall file his reply along with supporting documents within a period of two weeks from the date of receipt of a copy of this order and thereafter, the first respondent shall provide an opportunity of hearing to the petitioner and pass a reasoned order on merits and in accordance with law within a period of eight weeks _________ https://www.mhc.tn.gov.in/judis thereafter. There shall be no order as to costs. Consequently, connected miscellaneous petitions are closed.
2025 NCC : Yes/No Index : Yes/No Internet : Yes abr To 1.The State Tax Officer-V (Roving Squad), Office of the Joint Commissioner (ST), Commercial Taxes Department, Intelligence Trichy Division, Trichy-620 008. 2.The Commercial Tax Officer, Office of the Joint Commissioner (ST), Commercial Taxes Department, Intelligence Trichy Division, Trichy-620 008. _________ https://www.mhc.tn.gov.in/judis K.KUMARESH BABU, J. abr Dated: 21.01.2025 _________ https://www.mhc.tn.gov.in/judis
Reproduced from the public record of the Madras High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.