Facts of the Case

The petitioner, Tvl. Nesta, challenged an assessment order dated 18.12.2025 passed under Section 73 of the TNGST Act for the assessment year 2021-22 (GSTIN 33BAGPS9535M1Z2, Reference No. ZD3312252977725), which was preceded by a show cause notice in DRC-01 dated 23.05.2025 and personal hearing notices dated 01.07.2025, 09.07.2025 and 10.10.2025. The petitioner had not availed of these hearing opportunities and suffered the impugned order. By the time the petition was filed on 21.07.2026, the limitation for filing a statutory appeal under Section 107 had already expired.

Issues Involved

  1. Whether the impugned assessment order, alleged to be cryptic and non-speaking, was liable to be quashed despite the petitioner having failed to respond to prior hearing notices.
  2. On what terms de novo adjudication should proceed, given the expiry of the statutory appeal limitation.

Petitioner's Arguments

  • The impugned assessment order was cryptic, non-speaking, illegal, arbitrary and wholly without jurisdiction, warranting that it be quashed and a fresh order passed after affording an opportunity of being heard.
  • The petitioner undertook, through an endorsement in the Court Bundle, to pay 25% of the disputed tax as a condition for de novo adjudication.

Respondent's Arguments

  • Learned counsel for the State of Tamil Nadu took notice for the respondent; the writ petition was taken up for final hearing at the admission stage itself with consent of both sides.

Court Order / Findings

  • In view of the petitioner's undertaking to pre-deposit 25% of the disputed tax, the Court quashed the impugned order and remitted the case to the respondent to pass a fresh order, subject to the petitioner depositing the 25% amount in cash from the Electronic Cash Register within thirty days.
  • Within the same period, the petitioner was directed to file a reply to the show cause notice in DRC-01 dated 23.05.2025, treating the impugned order as an addendum to that notice.
  • On compliance, the respondent was directed to pass a final order on merits as expeditiously as possible, preferably within three months of the reply/pre-deposit.
  • If the petitioner failed to comply with any stipulation, the respondent was at liberty to proceed to recover the tax as if the writ petition had been dismissed in limine, with due notice to be given before passing any such order.

Important Clarification

  • Even after an assessee has repeatedly failed to respond to multiple personal hearing notices and has allowed the statutory appeal limitation to lapse, the Madras High Court's 25%-pre-deposit template remains available at the writ stage, converting the impugned order into an addendum to the original show cause notice for purposes of fresh adjudication, rather than requiring the entire process to restart from a fresh notice.
  • The template is strictly conditional and self-executing on default — non-compliance restores the Department's position as though the writ petition itself stood dismissed in limine.

Sections Involved

  • Section 73, TNGST Act, 2017 – provision under which the impugned assessment order was passed.
  • Section 107, TNGST/CGST Act, 2017 – statutory appeal provision, limitation under which had already expired.
  • Form GST DRC-01 – the original show cause notice, to which the impugned order was treated as an addendum.

Decision – In Favour of

The petition is disposed of in favour of the Assessee on a conditional basis — the assessment order is quashed subject to a 25% pre-deposit, with de novo adjudication to follow.

Case Details

  • Court: Madurai Bench of Madras High Court
  • Case No.: W.P.(MD) No. 20784 of 2026 with W.M.P.(MD) No.15435 of 2026
  • Coram: Hon'ble Mr. Justice C. Saravanan
  • Date of Order: 27.07.2026

Link to Download the Order

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