The Madras High Court referred the case back to the State Tax Officer (STO) and provided directions for recalculating interest and reviewing Input Tax Credit (ITC) claims.
An order dated 25.02.2025 passed by the State Tax Officer, Bhavani Assessment Circle, Erode, has been challenged by A.S.R. Constructions (applicant). This order confirmed part of the demand proposed in a Show Cause Notice (SCN) in DRC-01 dated 25.11.2024. The SCN specifies four defects.
But the demand for defect no 2 dropped. The applicant considered paying the late fee imposed u/s 47 of the respective GST legislation for defect no. 4. Hence, before the court, only defects 1 and 3 were adjudicated.
The applicant, the whole tax was filed dated 19.12.2022 from their electronic credit ledger, which was before the issuance of the DRC-01 notice, and stated that the levying of interest was unexplained.
The writ petition was disposed of by the bench of Justice C. Saravanan with certain observations. The same defect is related to outward supplies captured in GSTR-09. The total tax obligation was Rs 4,14,998.
The court asked the respondent (state tax officer) to recompute the interest. The computation needs to be performed post-comparing the delay with reference to the tax payment in the monthly returns (GSTR-3B) submitted u/s 39 of the GST legislation. Interest should be calculated considering the debit entry dated 19.12.2022.
The court said that the validated amount in the impugned order was Rs 48,835 towards CGST and ₹48,835 towards SGST. The court noted the submission of the applicant that they had certificates from the suppliers and asked for a chance to elaborate their case afresh.
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The court asked the applicant to submit the required certificates to explain their entitlement to the balance amount of the ITC within 30 days from the date of receipt of the order copy.
The court remitted the case to the State tax officer to again exercise the related defect Nos. 1 and 3. Based on the merits, the respondent was asked to move to pass the final orders post-hearing the writ petition. Subsequently, the writ petition was disposed of.
| Case Title | M/s.A.S.R Constructions vs The State Tax Officer |
| Case No. | WP No. 40814 of 2025 W.M.P.Nos.45736 & 45737 of 2025 |
| For Petitioner | Mr.P.V.Sudakar |
| For Respondent | Mr.TNC.Kaushik Additional Government Pleader |
| Madras High Court | Read Order |
