Facts of the Case

The petitioner, Tvl New Bell Brand Umbrella Mfg. Coy, was subjected to an ex-parte assessment order for the year 2017-18 (GSTIN 33AALPA6445L1ZN), reflected in Form GST DRC-07 dated 25.12.2023 and uploaded on the GST Portal, with a consequential attachment issued against the petitioner's suppliers under Form DRC-13. The petitioner stated that since the notice had been served only through the online portal, it remained unaware of the proceedings, and by the time of the writ petition, 55% of the disputed tax amount had already been recovered from it.

Issues Involved

  1. Whether the ex-parte order deserved to be set aside on terms of a further pre-deposit, given that a substantial part of the disputed tax had already been recovered.
  2. Whether the attachment made on the petitioner's suppliers under Form GST DRC-13 ought to be lifted upon such deposit.

Petitioner's Arguments

  • The order was passed ex-parte as notice was served only through the online portal, of which the petitioner remained unaware.
  • 55% of the disputed tax amount had already been recovered from the petitioner, and the petitioner sought quashing of the order and lifting of the attachment on suppliers, subject to fair terms.

Respondent's Arguments

  • The Additional Government Pleader submitted that in similar matters, relief has been granted on condition of the assessee depositing 25% of the disputed tax amount.

Court Order / Findings

  • Noting that 55% of the disputed tax amount had already been recovered — more than double the ordinarily-required 25% pre-deposit — the Court granted a concession, directing the petitioner to deposit a further 10% of the disputed tax amount, so that the total recovery/deposit would exceed the usual condition for relief.
  • On such deposit (verified against the truth of the 55%-recovery claim), the attachment made on the petitioner's suppliers under DRC-13 was directed to stand lifted forthwith and the impugned order to stand quashed; if the 55% claim was found incorrect, the petitioner would instead have to deposit the full 25% within thirty days for the same relief to apply.
  • The petitioner was further directed to file its reply to the show cause notice within thirty days, with the respondent to grant a personal hearing and pass a final order within two months; failure to comply with the deposit and reply conditions would result in automatic recall of the benefit and revival of the impugned order.

Important Clarification

  • Where an assessee shows that a substantial portion (here 55%) of the disputed tax has already been recovered by the Department pursuant to an ex-parte GST order, courts may grant conditional relief requiring only a modest further deposit, calibrated so the total exceeds the standard pre-deposit percentage otherwise required for such relief.
  • Such relief is inherently conditional and self-executing: non-compliance with the deposit or the timeline for filing a reply automatically revives the impugned order without further recourse to the Court.

Sections Involved

  • Tamil Nadu Goods and Services Tax Act, 2017 — the governing statute under which the ex-parte assessment in Form GST DRC-07 was passed.
  • Form GST DRC-13 — garnishee/attachment notice issued to the petitioner's suppliers to recover the disputed demand.

Decision – In Favour of

Disposed of in favour of the Assessee on the condition of a further 10% deposit; the impugned order stands quashed and the attachment lifted on compliance, failing which the benefit stands automatically recalled.

Case Details

Court: Madurai Bench of Madras High Court
Case No.: W.P(MD) No.34063 of 2025 with W.M.P(MD) Nos.26886 and 26888 of 2025
Coram: Hon'ble Mr. Justice G.R. Swaminathan
Date of Order: 26th November, 2025

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