The Madurai Bench of the Madras High Court has quashed the rejection of a taxpayer’s application seeking the exemption of interest and penalty under the GST Amnesty Scheme rolled out via Section 128A of the CGST Act, 2017.
The Court said that the benefit of the amnesty scheme cannot be refused until the larger problem for the interpretation and scope of Section 128A is determined by the Principal Seat of the High Court.
Justice C. Saravanan asked the tax authorities to reconsider the application of the taxpayer after the pending batch of cases on Section 128A is determined.
The order was challenged by the writ petition on August 13, 2025, issued by the Deputy State Tax Officer, which rejected the taxpayer’s application (Form GST SPL-02) for a waiver of interest and penalty under the GST Amnesty Scheme.
Also Read: What is Amnesty Scheme for GST Returns Non & NIL Filers?
The rejection order placed reliance on Circular No. 238/2024 dated October 15, 2024, citing that the amnesty benefit was not available where an interest obligation arose because of late reporting of supplies in GST returns. The authority must have observed that the applicant did not appear even after getting adequate chances.
The High Court said that the Principal Seat of the Madras High Court was analysing similar cases that involve the applicability of Section 128A. Thus, the Court discovered it appropriate to await the consequences of those proceedings rather than determining the problem independently.
The Court acknowledged that there was no disagreement regarding the taxpayer’s disclosure of the tax liability in GSTR-1, but the taxpayer did not pay the corresponding liability when filing the GSTR-3B returns. Additionally, it was noted that the assessment order seemed to have been issued u/s 73 of the GST Act.
The Bench further indicated that, prima facie, there was no legal restriction preventing the taxpayer from submitting an application u/s 128A, as long as the necessary conditions were met.
The Court directed the background of the legislative amendment and said that Section 128A was rolled out after the GST Council considered practical issues encountered by taxpayers after the inception of GST from July 1, 2017.
The Court, without remarking on the merits of the taxpayer’s claim, remanded the case back to the tax authority for fresh consideration after the Principal Seat furnishes its ruling on the Section 128A issues. The authority has been asked to pass a fresh order as per the final judgment in the pending proceedings.
The writ petition was disposed of without any order as to costs.
| Case Title | Tvl Annai Enterprises Vs The Deputy State Tax Officer- II |
| Case No. | WP(MD) No. 21116 of 2026 |
| Appellants By | Mr Raja.Karthikeyan |
| For Respondent | Mr S.Venkatesh |
| Madras High Court | Read Order |
