Case Law Details
Dhani Loans And Services Ltd. Vs State Tax Officer (Madras High Court)
The Madras High Court allowed a writ petition challenging an assessment order passed under Section 73 of the Tamil Nadu Goods and Services Tax Act, 2017 and a subsequent appellate order rejecting the assessee’s appeal on the ground of delay. The petitioner contended that it had been unable to place relevant materials before the assessing authority to explain the discrepancy referred to in the show cause notice. According to the petitioner, the disputed entries had already been reversed prior to issuance of the show cause notice and, if such reversal was considered along with the amount paid under the Reverse Charge Mechanism (RCM), there would be no variation between GSTR-2A and GSTR-3B and no further tax liability would arise.
The Court took note of the petitioner’s submission and also the fact that 100% of the disputed tax liability had already been recovered. In these circumstances, the Court held that the petitioner should be granted an opportunity to present its case before the assessing authority afresh.
FULL TEXT OF THE JUDGMENT/ORDER OF MADRAS HIGH COURT
This writ petition is filed challenging the impugned order dated 19.04.2022, which is the order of assessment passed under Section 73 of the Tamil Nadu Goods and Services Act, 2017 and the order dated 28.10.2025, which is an order rejecting the appeal filed by the assessee as the same was belated.
2. The learned counsel for the petitioner would submit that with reference to the discrepancy noted in the show cause notice, the petitioner could not avail the opportunity and place on record before the assessing authority that there has been reversal of the entries even before the issuance of show cause notice and if the same is taken into account, there will not be any further liability of tax at all. The amount paid under the RCM is taken into consideration and there will be no variation between GSTR2A and 3B.
3. In view of the said submission made and further considering the fact that 100% of the disputed tax liability as having been recovered already, I am of the view that an opportunity can be granted to the petitioner to agitate the case before the assessing authority afresh.
4. In view thereof, this writ petition is allowed on the following terms:
(i) The impugned orders 19.04.2026 shall stand set aside and the matter stands stand remanded back to the file of the first respondent.
(ii) Within a period of two weeks from the date of receipt of the web copy of the order, the petitioner will be entitled to file such additional reply and the documents in support of their claim and it is for the first respondent to consider the matter of fresh in the manner known to law.
(iii) No costs. Consequently, connected miscellaneous petition is closed.
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