Tvl St Traders vs. The Deputy State Tax Officer -2

Facts

The petitioner, Tvl ST Traders, represented by its Proprietrix Thangapushpam, filed a writ petition challenging an order dated 20.12.2025 passed by the Deputy State Tax Officer-2, Tenkasi Assessment Circle. This order confirmed a proposal in a show cause notice dated 20.09.2025 for the tax period 2021-22, issued under Section 73 of the TNGST Act, 2017. The impugned order was passed in the absence of a reply from the petitioner to the show cause notice. The petitioner contended that they deal in exempted goods and have not availed any input tax credits, with their entire turnover being exempt under Section 7 read with relevant notifications. An appeal filed belatedly against the impugned order was rejected on 24.06.2026.

Held

The Court held that the impugned order dated 20.12.2025 was passed without a reply from the petitioner. Consequently, the Court decided to remit the case back to the respondent for passing a fresh order. This is subject to the petitioner filing a reply to the show cause notice dated 20.09.2025, along with requisite documents, within thirty days of receiving a copy of the Court's order. The impugned order is to be treated as an addendum to the show cause notice. If the petitioner complies, the respondent shall pass a final order on merits expeditiously, preferably within three months of receiving the reply, after issuing due notice. If the petitioner fails to comply with the stipulations, the respondent is at liberty to proceed with tax recovery as if the writ petition was dismissed. The Court did not expressly leave any issue undecided.

Key Issues

1. Whether the impugned order dated 20.12.2025, passed by the respondent under Section 73 of the TNGST Act, 2017, is liable to be quashed as cryptic, nonspeaking, illegal, arbitrary, and without jurisdiction, for having been passed without considering a reply to the show cause notice? Petitioner's Arguments: The petitioner argued that the impugned order is unsustainable as it was passed without affording them an opportunity to be heard and without considering their reply to the show cause notice. They asserted that their business involves the supply of exempted goods and they have not availed any input tax credits, with their entire turnover being exempt under Section 7 read with the relevant notification. Respondent's Arguments: The respondent did not present any arguments as recorded in the judgment. The judgment notes that the impugned order was passed in the absence of a reply to the show cause notice.