GST demand order cannot be passed against Quashed SCN: Telangana HC

By CA Sandeep Kanoi Goods and Services Tax Judiciary , Trending January 31, 2025

TaxGuru Citation: 2025 taxguru.in 794
Case Name: Krishna Automotives Vs Deputy Commissioner of State Tax (Telangana High Court)
Appeal Number: Only available for paid members
Date of Judgement/Order: Only available for paid members
Courts: All High Courts, Telangana High Court

Upgrade to Basic or Premium to download.

Already Upgraded? Log in.

Krishna Automotives Vs Deputy Commissioner of State Tax (Telangana High Court)

Summary: The Telangana High Court ruled on a petition filed by Krishna Automotives, challenging an order dated December 27, 2023, issued by the Deputy Commissioner of State Tax. The case marked the second instance of the petitioner seeking judicial relief, following an earlier writ petition (WP No. 7919 of 2024) in which the court had already quashed the original show-cause notice (Form GST DRC-01 dated September 29, 2023) and the corresponding order due to non-compliance with Rule 26(3) of the CGST Rules, 2017. Despite this, the tax department proceeded to issue the impugned order based on the same quashed notice, prompting the petitioner to challenge its validity once again.

During the hearing, the Assistant Government Pleader acknowledged the department’s error in relying on a legally non-existent show-cause notice (SCN). The court ruled that the impugned order could not withstand judicial scrutiny and set it aside. However, it granted liberty to the tax authorities to take appropriate action in accordance with the law. Additionally, the court clarified that the period during which the writ petition was pending would not count toward the limitation period for any future proceedings. The decision underscores the importance of procedural compliance in tax enforcement.