A recent decision by the Madurai Bench of the Madras High Court has overturned a Goods and Services Tax assessment order. The court found that the notice regarding the order was presented as if it had been received by the taxpayer two days before it was actually issued. This raised concerns about the fairness of the process.
The applicant in the case of M/s. Sri Sakthimurugan Crusher contested the assessment order on 13.02.2025, passed u/s 73 of the TNGST Act for FY 2020-21.
The applicant mentioned that all messages and notifications were only available on the GST common portal, and the applicant was unaware of this. As a result, they were unable to respond in time as required.
Also, it claimed that the impugned order had been passed without providing a chance of personal hearing.
Also, the applicant before the court said that nearly 80% of the disputed tax amount had earlier been recovered by the department.
The department, a physical SCN in DRC-01 dated 25.11.2024, had been imposed on the applicant, and the taxpayer failed to answer despite such service.
The Court mentioned that from the acknowledgement of the postal, it determined that the notice on 25.11.2024 was recorded as having been obtained dated 23.11.2024, i.e., two days before its issuance date. The assessment order itself shows this peculiarity, the Court mentioned.
Therefore, Justice Krishnan Ramasamy said that a defect was there in the issuance and service of the SCN, which elaborated why the applicant may not have been aware of the proceedings.
It stated that the assessment order was passed without furnishing a hearing chance to the taxpayer, even after recovering 80% of the disputed tax. A clear breach of principles of natural justice, the court stated.
Recommended: How to Effortlessly Check the Validity of GST SCN & Orders
Subsequently, the HC set aside the impugned assessment order and remanded the case back to the State Tax Officer for fresh consideration.
| Case Title | M/s. Sri Sakthimurugan Crusher vs The Commercial Tax Officer/The State Tax Officer |
| Case No. | W.P.(MD)No.3241 of 2026 & W.M.P(MD)No.2669 of 2026 |
| For Petitioner | Mr.Sudalai Muthu N |
| For Respondent | Mr.R.Suresh Kumar, AGP |
| Madras High Court | Read Order |
