Tvl. A.L.K. Electricals vs. The Deputy State Tax Officer - I

Facts

The petitioner, Tvl. A.L.K. Electricals, filed a writ petition before the Madurai Bench of the Madras High Court challenging an order dated 28.02.2024 passed by the respondent, The Deputy State Tax Officer - I, Devakottai Assessment Circle. This order was issued pursuant to a show cause notice dated 24.01.2024 and subsequent reminders. The petitioner had failed to file a reply to the show cause notice or appear for personal hearings. The impugned order was passed ex-parte. During the hearing, the petitioner expressed willingness to pre-deposit 50% of the disputed tax amount as a condition for de novo adjudication.

Held

The Court quashed the impugned order dated 28.02.2024 passed by the respondent. The case was remitted back to the respondent for a fresh adjudication. This decision was made conditional upon the petitioner depositing 50% of the disputed tax in cash from their electronic cash register within thirty days of receiving a copy of the order. The petitioner was also directed to file a reply to the show cause notice dated 24.01.2024, along with supporting documents, within the same period. The impugned order was to be treated as an addendum to the show cause notice for this purpose. If the petitioner complied with these stipulations, the respondent was to pass a fresh order on merits expeditiously, preferably within two months of receiving the reply and pre-deposit. The attachment of the petitioner's bank account, if any, was to be automatically vacated subject to the deposit and the petitioner not being in arrears for other tax periods. The respondent was to issue due notice before passing any further order. If the petitioner failed to comply, the respondent was at liberty to proceed with recovery as if the writ petition was dismissed.

Key Issues

1. Whether the impugned order passed by the respondent is liable to be quashed on the grounds of procedural irregularities and lack of opportunity to the petitioner, considering the petitioner's willingness to pre-deposit 50% of the disputed tax? (Mixed question of law and fact) The petitioner argued that they were willing to deposit 50% of the disputed tax amount as a condition for a fresh adjudication. They made an endorsement to this effect in the court bundle. The respondent, represented by the counsel for the State of Tamil Nadu, took notice of the petition and consented to its disposal at the admission stage.