WP/42851/2026 of SRI MURUGAN TRADERS Vs The Commercial Tax Officer on 16 October 2026

ORDER

Mr.R.Sethu Prabakaran, learned Government Advocate (Tax) takes notice for the Respondent.

2. With the consent of both sides, this Writ Petition is taken up for final disposal at the admission stage itself.

3. This Writ Petition has been filed by the Petitioner seeking to quash the Demand Order dated 04.03.2026 bearing Reference No.ZD330426140134U passed by the Respondent.

4. The learned counsel for the Petitioner submitted that upon scrutinizing the returns filed by the Petitioner for the Financial Year 2023-24, it was found that there is a discrepancy in Taxable Turnover between GSTR-3B and E-Way Bill Data. Hence, the Respondent had issued a Show Cause Notice in Form GST DRC-01 on 19.09.2025 calling upon the Petitioner to file its objection, if any, within 30 days from the intimation of the said notice and to appear for personal hearing on 12.09.2025. However, the Petitioner neither filed any objection to the Show Cause Notice nor appeared for personal hearing. Therefore, the Respondent has passed the Demand Order dated 04.03.2026 along with Summary of the Order in Form GST DRC-07, confirming the tax and penalty proposed in the Show Cause Notice. That apart, the Respondent has initiated the recovery proceedings by attaching the Petitioner's Bank Accounts under Section 79 of the TNGST & CGST Act, 2017.

4.1. It is further submitted by the learned counsel for the Petitioner that the Show Cause Notice and the impugned Demand Order were merely uploaded on the Online GST Portal and the same were not served to the Petitioner through physical mode. Therefore, the Petitioner was unable to file any Reply/Objection to the Show Cause Notice, appear for personal hearing and prefer an Appeal against the impugned Demand Order. The Petitioner came to know about the impugned Demand Order only after the Bank Accounts of the Petitioner were freezed by the Respondent.

4.2. The learned counsel for the Petitioner also submitted that the Demand Order passed by the Respondent is an ex-parte order since prior to passing the Demand Order, the Petitioner was not heard by the Respondent. Therefore, the learned counsel submitted that the impugned Demand Order suffers from a violation of the principles of natural justice.

4.3. It is submitted by the learned counsel for the Petitioner that the Petitioner is ready and willing to deposit 25% of the disputed tax. Therefore, the learned counsel prayed that the impugned Demand Order may be quashed and the matter may be remanded back to the Respondent for fresh consideration.

5. The learned Government Advocate (Tax) appearing for the Respondent fairly submitted that since the Petitioner has voluntarily come forward to deposit 25% of the disputed tax, the prayer sought in this Writ Petition may be considered.

6. Heard the learned counsel for the Petitioner as well as the learned Government Advocate (Tax) for the Respondent and perused the materials available on record.

7. According to the Petitioner, the Show Cause Notice and the impugned Demand Order were merely uploaded on the Online GST Portal and were not served to the Petitioner through physical mode. Consequently, the Petitioner was unable to file any Reply/Objection to the Show Cause Notice and prefer an Appeal against the impugned Demand Order. Furthermore, the Respondent passed the Demand Order without even affording an opportunity of hearing to the Petitioner,

8. No doubt, sending notice by uploading in Online GST Portal is a sufficient service, but, the Officer who is sending the repeated reminders, despite of the fact that there is no response from the Petitioner to the show cause notices etc., the Officer should have applied his/her mind and explored the possibility of sending notices by way of other modes prescribed in Section 169 of the Central Goods and Service Tax Act, 2017 (for brevity, “CGST Act”) which are also the valid mode of service under the CGST Act, otherwise, the service of notice will not be deemed to be an effective service, rather, it would only amount to fulfilling the empty formalities.

9. Merely passing an ex-parte order by fulfilling the empty formalities will not serve any useful purpose and the same will only pave the way for a multiplicity of litigations, not only wasting the time of the Officer concerned, but also the precious time of the Appellate Authority/Tribunal and this Court as well. Thus, when there is no response from the taxpayer to the notice sent through a particular mode, the Officer who is issuing the notices should strictly explore the possibilities of sending notices through some other mode as prescribed in Section 169(1) of the CGST Act, preferably by way of RPAD which would ultimately achieve the object of the CGST Act. Therefore, this Court is of the opinion that there has been a lack of effort in applying the available opportunities to serve notices/orders etc., effectively on the Petitioner and the impugned Demand Order suffers from a violation of the principles of natural justice.

10. In view of the above, this Court is inclined to issue the following directions:

(i) The impugned Demand Order dated 04.03.2026 passed by the Respondent is quashed and the matter is remanded back to the Respondent for fresh consideration, on condition that the Petitioner shall deposit 25% of the disputed tax, within a period of four weeks from the date of receipt of a copy of this order.

(ii) It is made clear that quashing of the impugned Demand Order will come into effect, only from the date of deposit of 25% of the disputed tax by the Petitioner.

(iii) The Petitioner is directed to file its Reply/Objection along with the required documents, if any, within a period of three weeks thereafter.

(iv) On filing of such Reply/Objection by the Petitioner, the Respondent shall consider the same and issue a 14 days clear notice affording an opportunity of personal hearing to the Petitioner. Thereafter, the Respondent shall pass appropriate orders on merits and in accordance with law, as expeditiously as possible.

(v) So far as the attachment made in Petitioner's Bank Accounts is concerned, it is needless to state that once the impugned Demand Order is quashed, the order of attachment cannot survive any longer. On production of proof with regard to the payment of 25% of disputed tax by the Petitioner, the concerned Bank is directed to de-freeze the Petitioner's Bank Accounts forthwith.

11. With the above directions, this Writ Petition is disposed of. No costs. Consequently, connected Miscellaneous Petition is closed. 16-10-2026 mrr Index: Yes/No Speaking/Non-Speaking Order Neutral Citation: Yes/No To The Commercial Tax Officer/ The State Tax Officer, Edappadi Assessment Circle, 60A, SMVT Nagar, Vellandi Valasu, Edappadi, Salem – 637 105.

KRISHNAN RAMASAMY, J. mrr W.P.No.42851 of 2026 16-10-2026