Non-Reply to SCN: HC Quashes GST Assessment Order, Allows Fresh Hearing with 10% Pre-Deposit:

Non-Reply to SCN: HC Quashes GST Assessment Order, Allows Fresh Hearing with 10% Pre-Deposit The Madras High Court has recently delivered its judgement on a writ petition filed by Bhairavi Metal Works against the State Tax Officer, Thirukazukundram Assessment Circle, challenging an order dated December 08, 2025, passed by the GST authorities under Section 73 of the Tamil Nadu GST Act, 2017 read with the CGST Act, 2017. The case pertains to the Assessment Year 2021-22. Prior to the impugned order, the petitioner was issued with a show cause notice (SCN) dated July 06, 2025, wherein the petitioner was asked to appear for the personal hearing. However, the petitioner neither appeared for the hearing nor furnished a reply to the notice. In conclusion, GST authorities passed the impugned order dated December 08, 2025.

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Being aggrieved with the aforementioned order, the petitioner filed an appeal before the Madras High Court within the legal time limit on February 23, 2026. During the hearing, the petitioner claimed that it is willing to pay a pre-deposit of 10% of the disputed tax as a condition for denovo adjudication (fresh consideration of the case). When the court analysed the facts of the case, it quashed the impugned GST assessment order and sent the case back to the tax authorities for fresh consideration. The petitioner has been directed to deposit 10% of the disputed tax in cash or from the Petitioner's Electronic Cash Register within 30 days and also file a detailed reply to the original SCN along with the submission of all relevant supporting documents.

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If the petitioner complies with the aforementioned conditions, then the tax authority must pass a fresh order based on the merits of the case within the time limit of three months. The court also stated that any bank account attachment against the petitioner would be automatically vacated once the mentioned conditions are met. However, if the petitioner fails to comply with the aforementioned conditions, then the tax authorities will be free to recover the tax as per law. The court disposed of the writ petition with these directions.