GST Assessment Deemed withdrawn Once Returns Filed: AP HC Quashes Orders u/s 62, Maintains Interest on Delay [Read Order]

In a recent ruling, the Andhra Pradesh High Court held that once a registered taxpayer files the pending GST returns after a best judgment assessment under Section 62(1) of the Goods and Services Tax ( GST ) Act, such assessment orders are deemed to have been withdrawn under Section 62(2). However, the Court clarified that liability to pay interest for the delay in tax payment would continue.

The petitioner, Pushpa Decors, a registered taxpayer under the GST Act, was subjected to best judgment assessments for the months of March, April, and May 2023, as the returns had not been filed within the due date.

The Assistant Commissioner issued ex parte assessment orders under Section 62 of the Act on 12 July 2023. Subsequently, the petitioner filed the GSTR-3B returns for the said months on 11 October 2023, along with late fees and tax dues.

The petitioner contended that as per Section 62(2) of the GST Act, once the pending returns are filed within the stipulated time, the best judgment assessment order “shall be deemed to have been withdrawn.”

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Despite this, the department failed to withdraw the orders and proceeded with recovery, which the petitioner challenged as illegal and contrary to law. It was also submitted during the petition that the assessment orders were unsigned, lacked Document Identification Numbers (DINs), and were passed without following due process, including the opportunity for a personal hearing.

The Government Pleader for Commercial Taxes, appearing for the respondents, admitted that while the petitioner had complied with the filing requirements under Section 62(2), the orders could not be technically withdrawn due to system glitches, preventing closure of the assessment in the GSTN portal.

A Division Bench comprising Justice R. Raghunandan Rao and Justice T.C.D. Sekhar observed that the statutory provision under Section 62(2) of the GST Act is clear and mandatory if returns are filed within the permitted time after issuance of a best judgment assessment, such assessment automatically stands withdrawn.

The Court relied on its earlier ruling dated 13 August 2025 in W.P. No. 20705 of 2025, where a similar issue was addressed, and reiterated that technical system errors cannot override the statutory mandate.

Accordingly, the Court set aside the impugned assessment orders dated 12 July 2023, treating them as deemed withdrawn in accordance with law. However, it clarified that the taxpayer’s liability to pay interest for delayed payment of tax continues, as the filing was beyond the prescribed due date.

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