Madras HC Dismisses Writ as GST Payer Admitted Tax Liability in Reply

Tvl.M.Reddiapatti Industries Sales Society Vs Deputy State Tax Officer- 1 (Madras High Court)

The Madras High Court on June 26, 2025, dismissed a writ petition filed by Tvl. M. Reddiapatti Industries Sales Society challenging a GST assessment order dated January 2, 2024, for the Assessment Year 2020-21. The Court’s decision was based on two primary grounds: laches and the petitioner’s admission of tax liability.

The Court noted the petition was filed beyond the statutory period prescribed under Section 117 of the TNGST Act. More critically, the assessment order referenced the petitioner’s online reply dated February 6, 2023, where the taxpayer reportedly “accepted the defect and declared that CGST Rs.1,25,659.57 + SGST Rs. 1,25,659.57 is to be paid.” This admission stemmed from a mismatch between turnover reported in GSTR 1 and GSTR 3B, leading to a lesser tax payment. Despite the petitioner claiming no copy of this reply, the Court held that the admission of liability in the official record negated the challenge. No specific judicial precedents were cited, but the ruling aligns with principles of estoppel and administrative finality when taxpayers concede liability.

FULL TEXT OF THE JUDGMENT/ORDER OF MADRAS HIGH COURT

The petitioner has challenged the impugned assessment order on the file of respondent vide GSTIN.33BOOPS9469G1Z5/2020-21 dated 02.01.2024 as long after it was passed.

2. This writ petition is filed beyond the statutory period prescribed under Section 117 of the TNGST Act. In the impugned assessment order, the respondent referred to (i) notice issued to the petitioner in Form GST ASMT 10 dated 09.02.2022, (ii) notice in Form GSR DRC-01A dated 28.03.2022, and (iii) notice in Form DRC-01 dated 30.11.2022, to which the petitioner replied on 06.02.2023. The petitioner does not have the copy of the aforesaid reply dated 06.02.2023. However, in the impugned order, it has been stated as under:

“But the tax payer replied through online and by the way of reply the tax payer has accepted the defect and declared that CGST Rs.1,25,659.57 + SGST Rs. 1,25,659.57 is to be paid. But as per the GSTR-3B return filed by you you have paid only CGST Rs.85,693 + CGST Rs.85,693. And the balance amount as already declared in the notice remains unpaid.”

3. A reading of the impugned order indicates that there is 2/4 mismatching between the reported turnover in GSTR 1 and GSTR 3B for a sum of Rs.16,44,168.80. As a result of which, the petitioner has paid a lesser tax as detailed below:

4. In view of the above, the petitioner has no case to challenge the impugned order even if the writ petition is filed at an earlier point of time. This writ petition, therefore, is dismissed not only on the ground of laches but also because the petitioner has admitted to the tax liability in a reply dated 06.02.2023. No costs. Consequently, connected miscellaneous petition is also dismissed.