M/S. Leela Krishna Paints vs. The Assistant Commissioner (St)-Ii

Held

The Court held that the assessment orders passed under Section 62 of the GST Act are deemed to have been withdrawn. This decision is based on the provisions of Section 62(2) of the GST Act, which stipulates that such orders are withdrawn upon the filing of the necessary returns. The Court noted that the petitioner had paid the applicable late fees and interest for the delayed filing of the GSTR 3B return for August 2025. The Court followed the precedent set by the Madras High Court (Madurai Bench) in Writ Petition (MD) No.18740 of 2024, which held that in view of the amendment to Section 62(2), it would be appropriate to condone the delay and deem the assessment order withdrawn. The Court also referred to its own previous judgment in W.P.No.20705 of 2025, which extended similar benefits. Therefore, the benefit under Section 62(2) was extended to the petitioner. The operative direction was that the assessment order under challenge is deemed withdrawn, and no steps for recovery of taxes and dues raised under that order can be initiated or continued.

Facts

The petitioner, M/s. Leela Krishna Paints, filed a writ petition challenging assessment orders dated 12.11.2025 (Form GST ASMT-13) and 13.11.2025 (Form GST DRC-07) for August 2025. These orders were passed under Section 62 of the GST Act due to the petitioner's failure to file returns. The petitioner contended that while the returns for August 2025 were filed late on 27.04.2026, the applicable interest and late fees were paid on 09.10.2026. Despite payment, the respondent authorities had not withdrawn the assessment orders, compelling the petitioner to approach the High Court. The dispute involves late fees and interest totaling ₹5,000.00 (CGST and SGST) and additional late fees of ₹10,600.00 each for CGST and SGST.

Key Issues

1. Whether the assessment orders passed under Section 62 of the GST Act are deemed to have been withdrawn in light of the petitioner filing the delayed returns and paying the stipulated late fees and interest, as per Section 62(2) of the GST Act? Petitioner's Arguments: The petitioner argued that Section 62(2) of the GST Act mandates that an order passed under Section 62 is deemed withdrawn if the required returns are filed within the stipulated period. Even in cases of delay, upon payment of late fees and interest, the assessment order should be considered withdrawn. The petitioner had paid the applicable interest and late fees for the delayed filing of the August 2025 return, yet the respondent authorities failed to withdraw the assessment orders. They relied on the principle that once compliance is made, the assessment order should cease to have effect. Respondents' Arguments: The judgment does not record any specific arguments made by the respondents. However, the context implies that the respondents had not withdrawn the assessment orders despite the petitioner's subsequent compliance.