WP/43100/2026 of M/s. Dev Forwarders Vs The Appellate Deputy Commissioner (ST) on 16 October 2026

ORDER

Mr.R.Sethu Prabakaran, learned Government Advocate (Tax) takes notice on behalf of the Respondents.

2. The Petitioner has filed this Writ Petition for the following reliefs:

(i) To call for the records relating to the Order-in-Appeal dated 31.07.2026 passed by the 1st Respondent; Assessment Order dated 31.12.2025 passed by the 2nd Respondent; Scrutiny Notice in Form GST ASMT-10 dated 20.08.2025 & Show Cause Notice in Form GST DRC-01 dated 29.09.2025 issued by the 3rd Respondent and to quash the same;

(ii) To direct the Respondents to refund the Petitioner a sum of Rs.17,86,464/- remitted on 30.03.2026 towards the statutory pre-deposit of Rs.17,74,783/- and the admitted amount of Rs.11,668/- together with interest thereon.

(iii) To set aside the Order-in-Appeal dated 31.07.2026 and restore the Appeal No.AP/GST/428/2026 to the file of the 1st Respondent for fresh consideration.

(iv) To direct the Respondents to refund the Petitioner a sum of Rs.11,668/- remitted a second time under protest and to retain the statutory pre- deposit of Rs.17,74,783/- to the credit of the restored appeal.

3. The brief facts of the case are that upon scrutinizing the returns filed by the Petitioner for the Financial Year 2021-2022, the Deputy Commiecial Tax Officer, Kovilpatti Assessment Circle – I had issued a Scrutiny Notice in Form GST ASMT-10 dated 10.02.2023, calling upon the Petitioner to submit its reply by 10.03.2023. After the receipt of same, the Petitioner submitted its replies vide Form GST ASMT-11 dated 08.03.2023 & 27.03.2023 respectively and paid a sum of Rs.821/- towards IGST for the tax period April, 2021 to March, 2022 vide Form GST DRC-03 dated 26.03.2023. Thereafter, the Deputy State Tax Officer, Kovilpatti Assessment Circle – I had passed an Order in Form GST ASMT-12 dated 05.05.2023, dropping the proceedings initiated against the Petitioner. After 60 days from the said order, the 3rd Respondent had issued a

Scrutiny Notice in Form GST ASMT-10 dated 20.08.2025 for the Financial Year 2021-2022, raising the following three defects:

(i) An alleged short payment of Rs.11,668/- arising on a reconciliation of the annual return with the reconciliation statement;

(ii) An alleged mismatch between the exempt turnover of Rs.9,84,55,480/- reported in annual return and the sum of Rs.22,000/- appearing in the monthly returns; and

(iii) The reduction of output tax of Rs.25,830/- through credit notes. In response to the Scrutiny Notice dated 20.08.2025, the Petitioner submitted its Reply in Form GST ASMT-11 dated 19.09.2025. However, the State Tax Officer, Kovilpatti Circle had issued a Show Cause Notice in Form GST DRC-01 dated 29.09.2025, calling upon the Petitioner to submit its reply by 29.10.2025. After the receipt of said Show Cause Notice, the Petitioner vide Letters dated 28.10.2025, 28.11.2025 & 29.12.2025, requested the Deputy State Tax Officer, Kovilpatti – 1 to grant 30 days time for providing detailed explanation for the Show Cause Notice. However, the 2nd Respondent had passed the Assessment Order dated 31.12.2025, confirming the tax and penalty proposed in the Show Cause Notice dated 29.09.2025. So, the Petitioner filed a Rectification Application dated 09.01.2026 before the 2nd Respondent seeking to revise the Assessment Order dated 31.12.2025. However, the 2nd Respondent has rejected the said Rectification Application. Therefore, the Petitioner preferred an Appeal in Form GST APL-01 dated 30.03.2026 before the 1st

Respondent. The 1st Respondent vide Order dated 31.07.2026, partly modified, partly dismissed and partly allowed the said Appeal. Under these circumstances, the Petitioner has filed this Writ Petition for the aforesaid reliefs.

4. The learned counsel for the Petitioner submitted that the impugned demand has been primarily confirmed on account of the differences in GSTR-9 Reconciliation, Credit Notes and Exempt/Nil rated/Non-GST supplies. The entire dispute arises only due to an inadvertent error in reporting and classification of certain transactions in the GST returns. The transactions which were required to be reported under Non-GST supplies were erroneously disclosed under 0% taxable supplies in GSTR-1. Consequently, the turnover of Rs.9,84,55,480/- pertains to Non-GST supplies in the nature of pure agent reimbursements was reflected as exempt turnover in GSTR-9 and GSTR-9C which has been erroneously construed as taxable differential turnover by the Respondent Department.

4.1. It is submitted by the learned counsel for the Petitioner that the Petitioner does not render the CFS storage service but merely acts as a pure agent. In the course of business, the CPS/Service Provider raises invoices directly in the name of Petitioner’s client and the Petitioner makes payment to such third-party vendors on behalf of its client. The exact amount is thereafter recovered from the Petitioner’s client on actual basis without any markup.

Thus, the transactions are in the nature of pass-through reimbursements. However, the Adjudicating Authority has proceeded on the incorrect assumption that CFS Storage Charges are taxable support services liable to GST.

4.2. The learned counsel for the Petitioner also submitted that subsequent to the filing of Appeal, the 1st Respondent had conducted a Personal Hearing on 21.05.2026, pursuant to which, the Petitioner had submitted the following documents before the 1st Respondent:

(i) Representative Reimbursement/Pure Agent Invoices along with supporting documents;

(ii) Ocean freight invoices pertaining to export shipments;

(iii) Supporting reconciliation for the transactions reported under the 0% tax rate column in GSTR-1; and

(iv) Copy of Notification No.2/2018 – Integrated Tax (Rate) dated 25.01.2018 prescribing NIL rate for ocean freight services; and

(v) Relevant exemption notification relating to transportation services. However, without considering the same, the 1st Respondent has passed the impugned Order dated 31.07.2026. Therefore, the learned counsel prayed that the impugned orders may be quashed and the matter may be remanded back to the 2nd Respondent/Assessing Authority.

5. In the present case, the learned counsel for the Petitioner has made submissions on three distinct aspects, namely

(1) The transactions that ought to have been reported under Non-GST supplies were erroneously reported under 0% taxable supplies in GSTR-1;

(2) The transactions amounting to Rs.9,84,55,480/- represent pure agent reimbursements and the same do not pertain to taxable outward supplies.

(3) The Petitioner is not the supplier of CFS storage service but acts as a pure agent.

6. As far as this case is concerned, since the above aspects are factual in nature, the same has to be decided by the appropriate Appellate Authority. Hence, this Court is not inclined to entertain this Writ Petition. Accordingly, this Writ Petition is dismissed. However, liberty is granted to the Petitioner to challenge the Order-in-Appeal dated 31.07.2026 by filing an appeal before an appropriate Appellate Authority. No costs. Consequently, connected Miscellaneous Petition is closed. 16-10-2026 mrr Index: Yes/No Speaking/Non-Speaking Order Neutral Citation: Yes/No

To

1. The Appellate Deputy Commissioner (ST), Goods and Services Tax Appeals, Chennai-North, 2nd Floor, PAPJM Annexure Buildings, Greams Road, Chennai - 600 006.

2. The Assistant Commissioner ST, Egmore Assessment Circle, No.88, 2nd Floor, Taluk Office Building, Mayor Ramanathan Salai, Spur Tank Road, Chetpet, Chennai – 600 031.

3. The Commercial Tax Officer, Kovilpatti Assessment Circle-I, Ettayapuram Road, Kovilpatti, Thoothukudi District, Tamil Nadu – 628 501.

4. The Commissioner of Commercial Taxes, Chepauk, Chennai.

KRISHNAN RAMASAMY, J. mrr W.P.No.43100 of 2026 16-10-2026