2025 (4) TMI 167 - HC - GST

GST Assessment Order Challenged for Exceeding Show Cause Notice and Imposing 100% Penalty Under Section 74

Sri Balaji Tollways (Madurai) Private Limited, Represented by its Managing Director Mr. Seyyadurai Nagarajan Versus The Deputy State Tax Officer - 2, Madurai

The HC disposed of a writ petition challenging a GST assessment order for AY 2018-19, which the petitioner claimed was a non-speaking order issued without ... Challenge to assessment order - impugned order is a non-speaking order, violating Section 75(6) of the GST Act, as it fails to address the petitioner's submissions - violation of principle sof natural justice - HELD THAT:- Considering the submissions made by the learned counsel for the petitioner and the learned Government Advocate for the respondent and also considering the fact that the petitioner is having an appeal remedy before the appellate Deputy Commissioner (State Tax) (GST Appeal), Madurai, under Section 107 of the GST Act, 2017, this writ petition is disposed of, with liberty to the petitioner to approach the appellate authority and raise all the grounds raised in this writ petition in the appeal. In the event, if any appeal is filed within a period of two weeks from the date of receipt of a copy of this order, the appellate authority shall entertain the appeal without reference to the period of limitation and dispose of the same in accordance with law, within a period of three months thereafter. In the interregnum, the respondent shall maintain status quo prevailing as on date. Petition disposed off. In the case before the Madras High Court, the petitioner challenged an assessment order dated 10.09.2024, for the Assessment Year 2018-2019. The petitioner argued that the order was a 'non-speaking order,' violating Section 75(6) of the GST Act, as it did not address the petitioner's submissions. It was issued under Section 74 of the GST Act without allegations of fraud or suppression of facts, which are necessary jurisdictional preconditions. Additionally, the petitioner claimed the order exceeded the scope of the show cause notice by imposing a 100% penalty, contrary to Section 75(7) of the GST Act, and was based on incorrect credit figures.The petitioner cited several judgments to support their case, including S.S. Communications v. Deputy State Tax Officer and HCL Infotech Ltd. v. Commissioner, Commercial Tax. The respondent's counsel argued that the order was issued after providing the petitioner sufficient opportunity to present their case and noted that the petitioner has an available appeal remedy under Section 107 of the GST Act, 2017, which they had not pursued.The court, presided over by Honourable Mr. Justice Vivek Kumar Singh, acknowledged the petitioner's right to appeal and disposed of the writ petition, granting the petitioner liberty to approach the appellate authority. The court instructed that if an appeal is filed within two weeks, it should be entertained without reference to the limitation period and resolved within three months. The respondent was ordered to maintain the status quo in the interim. There were no orders as to costs, and connected miscellaneous petitions were closed.