Tvl R P G Traders Vs State Tax Officer (Madras High Court)
The Madras High Court examined a writ petition challenging an order passed by the State Tax Officer for the assessment year 2020–21, by which late fees and a general penalty were imposed for failure to file annual returns under the GST law, and the petitioner’s bank account was frozen. The petitioner contended that under Section 47 of the Tamil Nadu GST Act, 2017, only late fees could be levied for delayed filing of annual returns and that the imposition of a general penalty under Section 125 was impermissible once late fees were already levied. It was also argued that the order was passed without proper enquiry as contemplated under Section 73 of the Act.
The Court noted that the authority had levied late fees of ₹75,025 each under CGST and SGST, totalling ₹1,50,050, and additionally imposed a general penalty of ₹50,000 under Section 125. The Court held that Section 125 applies only where no specific penalty is provided elsewhere, and since late fees had already been levied under Section 47, the general penalty could not be sustained. Accordingly, the general penalty of ₹50,000 was set aside.
On the computation of late fees, the Court held that the authority had incorrectly calculated the amount. It clarified that the maximum late fee prescribed under Section 47(2) should be computed first and only thereafter apportioned between CGST and SGST. The Court therefore modified the late fee to ₹37,512.50 under CGST and ₹37,512.50 under SGST, totalling ₹75,025. The Court further directed that upon payment of the modified late fee, the petitioner’s bank account should be defrozen. The writ petition was disposed of with these directions and without costs by the Madras High Court.
