Rr Construction vs. The Deputy State Tax Officer-2

Facts

The petitioner, R.R. Construction, represented by its partner R. Saravanan, filed a writ petition challenging a notice dated 09.10.2025 issued by the Deputy State Tax Officer-2. The notice sought to levy Goods and Services Tax (GST) on seigniorage fee/royalty and DMFT paid by the petitioner for quarrying and transporting minerals during the tax period 2020-2021. The petitioner contended that the issue of levying GST on seigniorage fee/royalty for quarrying and transporting minerals is currently pending before the Hon'ble Supreme Court. The respondent is the Deputy State Tax Officer-2, Madurai.

Held

The Court held that given the pendency of the issue concerning the levy of GST on seigniorage fee/royalty for quarrying and transporting minerals before the Hon'ble Supreme Court, it was inclined to dispose of the writ petition at the admission stage. The Court directed the respondent to keep all proceedings in abeyance and await the orders of the Hon'ble Supreme Court. Subsequently, the respondent is to proceed in accordance with the law as decided by the Supreme Court. As a condition, the petitioner was directed to deposit 10% of the disputed tax as security, a direction that was in line with previous orders in the petitioner's own case. The writ petition was disposed of with these observations. No issue was expressly left undecided, as the court deferred to the Supreme Court's decision.

Key Issues

1. Whether the impugned notice dated 09.10.2025, levying GST on seigniorage fee/royalty and DMFT for the tax period 2020-2021, is liable to be quashed, considering the pendency of a similar issue before the Hon'ble Supreme Court? (Question of law) Petitioner's contention: The petitioner argued that the issue concerning the levy of GST on seigniorage fee/royalty paid for quarrying and transporting minerals is presently sub-judice before the Hon'ble Supreme Court. Therefore, the proceedings initiated by the respondent should be stayed. Respondent's contention: The respondent did not record any specific arguments in the judgment. However, the court's direction to await the Supreme Court's orders implies an acknowledgment of the pending matter.