High Court Grants Second Chance After Ex Parte GST Order

The petitioner, Tvl. P. Rengasamy, is a works contractor who was issued an assessment order under Section 74 of the TNGST Act 2017 following the discovery of discrepancies between his GSTR 1/3B returns and the GSTR 7 (TDS) returns filed by various government departments.

Due to the petitioner’s failure to respond to show-cause notices or participate in the assessment proceedings, the tax officer issued an ex-parte order.

The petitioner subsequently justified this lack of participation by claiming that his part-time accountant failed to notice the legal proceedings due to work pressure and that he personally faced difficulties accessing the web portal.

Issues in the case

1. Whether the ex parte assessment order should be quashed because the petitioner was unable to present his side of the case.

2. Whether the petitioner should be granted a fresh opportunity to produce documents explaining the mismatch in tax reporting.

Decision of the Court

The Court allowed the writ petition on equitable grounds, setting aside the impugned assessment order dated July 25, 2025, and remanding the matter back to the respondent for fresh consideration. While the Court typically mandates a 25% deposit of the disputed tax as a condition for such an opportunity, this requirement was waived because 51% of the CGST and SGST demand had already been recovered. Consequently, the Court ordered that any bank account attachments made pursuant to the original order be raised. The petitioner is now directed to appear before the assessing officer within four weeks of receiving the order to submit a formal reply and supporting documents for a fresh decision in accordance with the law.