Abarna Match Industries Vs State Tax Officer (Madras High Court)
In this case, the petitioner challenged an order dated 26.12.2025 passed under Section 74 of the Tamil Nadu Goods and Services Tax Act, 2017. The dispute arose after the petitioner had claimed and received a refund of ₹4,75,859 based on available input tax credit (ITC). Subsequently, the Revenue succeeded in an appeal before the Appellate Authority, resulting in reversal of the refund.
The petitioner submitted that it had decided to file a second appeal and had already deposited the required 10% amount. However, due to glitches in the GST portal, the appeal could not be taken on file. During this period, the respondent passed the impugned order under Section 74 of the Act.
The petitioner argued that, in view of the Circular dated 18.11.2019, particularly Clause 22, an order under Sections 73 or 74 could not be passed. It was also contended that the respondent could not invoke Section 74 to impose interest and penalty in the circumstances of the case.
The Revenue, on the other hand, maintained that once a refund had been sanctioned and availed, recovery proceedings under Section 73 or Section 74 were necessary to recover the liability arising from the reversal of the refund.
