Facts of the Case

The petitioner, Tvl R.K.S. Builders, Mayiladuthurai, challenged an assessment order dated 15.06.2023 passed under Section 73 of the Tamil Nadu GST Act, 2017 for tax period 2019-20, along with the Appellate Deputy Commissioner's order dated 10.03.2025 dismissing the petitioner's appeal for having been filed 134 days beyond the condonable period of limitation under Section 107. It was undisputed that the petitioner had not replied to the notices preceding the assessment order. The petitioner nevertheless sought relief from the Madras High Court, Madurai Bench, on the well-established terms the Court has applied in comparable cases of belated non-response, involving quashing subject to a substantial pre-deposit.

Issues Involved

  1. Whether an assessment order under Section 73, against which the statutory appeal was time-barred by 134 days beyond the condonable period, could still be interfered with by the writ court.
  2. What conditions the Court should impose to balance the taxpayer's opportunity to be heard against the finality of unchallenged limitation periods.
  3. Whether the impugned order should be treated as a fresh show cause notice enabling a substantive reply.

Petitioner's Arguments

  • Though the petitioner had not responded to the pre-assessment notices and its appeal was filed well beyond the condonable delay period, the Court had, in similar circumstances, come to the rescue of similarly placed assessees by quashing the assessment on terms of a 25% pre-deposit.

Respondent's Arguments

  • The Additional Government Pleader for the respondents did not press any specific objection beyond supporting the impugned orders on record.

Court Order / Findings

  • The Court noted it had, under similar circumstances, previously granted relief to persons like the petitioner by quashing assessment orders on terms of payment of 25% of the disputed tax as pre-deposit in cash, and found no reason to deviate from that consistent approach.
  • Even where a taxpayer's statutory appeal against a Section 73 assessment order is hopelessly time-barred, the Madras High Court will quash the assessment order and remit it for a fresh decision on merits, provided the taxpayer deposits 25% of the disputed tax in cash and treats the quashed order as a corrigendum to the original show cause notice.
  • The impugned assessment order was quashed and remitted for fresh orders, with the petitioner directed to file a reply to the original show cause notice within 30 days along with the 25% deposit, and the first respondent directed to decide afresh within three months after affording a hearing.

Important Clarification

  • The Madras High Court has developed a settled practice of granting one more opportunity to non-responsive GST assessees, even beyond the condonable appeal period, conditioned on payment of 25% of the disputed tax as pre-deposit.
  • Treating the quashed assessment order as a corrigendum/addendum to the original show cause notice, rather than issuing an entirely fresh notice, streamlines the re-adjudication process.
  • This 25% pre-deposit route operates independently of, and is more taxpayer-favourable in outcome than, a bare dismissal for limitation, though it comes at a real cash cost to the assessee upfront.

Sections Involved

  • Section 73, Tamil Nadu GST Act, 2017 – determination of tax not paid, under which the original assessment order was passed.
  • Section 107, Tamil Nadu GST Act, 2017 – prescribes the limitation and condonable delay period for filing appeals, which the petitioner had exceeded.

Decision – In Favour of

The decision favours the assessee, conditionally. The assessment order and the appellate rejection were both effectively superseded by a remand on payment of 25% of the disputed tax, giving the petitioner a fresh opportunity on merits.

Case Details

Madurai Bench of the Madras High Court; W.P.(MD) No.16084 of 2025 with W.M.P.(MD) Nos.12179 and 12180 of 2025; Tvl R.K.S. Builders vs Deputy State Tax Officer (ST), Mayiladuthurai and Another; Coram: Justice C. Saravanan; Decided on 16.06.2025.

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