Tvl. Skp Readymix Vs Commissioner of Commercial Taxes (Madras High Court)
The Madras High Court, in the case of Tvl. SKP Readymix Vs Commissioner of Commercial Taxes, has set aside an order dated March 13, 2025, and remitted the matter back to the tax authorities for a fresh decision. The High Court found that the impugned order, issued by the third respondent, lacked sufficient discussion and failed to properly consider documents submitted by the petitioner.
The petitioner, Tvl. SKP Readymix, had challenged the order which pertained to alleged defects in their tax filings for the assessment year 2022-23. The defects identified by the tax department included: excess claim of Input Tax Credit (ITC) due to a mismatch between GSTR 2A and 3B, proposed tax due on short reporting of outward supply, and blocked credit under Section 17(5) of the TNGST Act 2017.
During the proceedings, the petitioner admitted liability for the blocked credit under Section 17(5) and had already paid the amount related to the ITC mismatch (defect No. 1). However, the core of the dispute revolved around the second and third defects, where the petitioner contended that their submitted documents were not adequately considered.
The High Court observed that while the impugned order extracted the petitioner’s reply to the show cause notice and acknowledged a personal hearing, it provided no clear discussion or application of mind regarding the defenses presented. The order merely stated, “The tax payer has filed reply only. But the tax payer has not filed any supporting documents to prove their genuineness. Hence, in this circumstances the tax payer’s reply could not be accepted and the demand proposed in the show cause notice is hereby confirmed u/s 74 of the TNGST Act 2017.”
