No Participation in GST Adjudication: Madras HC Grants Final Opportunity to Assessee with Strict Recovery Warning [Read Order]
The judgment included a stern caveat: failure to comply with the deposit or to file the reply would result in the writ petition being deemed dismissed, allowing the department to initiate recovery proceedings without further delay.
![No Participation in GST Adjudication: Madras HC Grants Final Opportunity to Assessee with Strict Recovery Warning [Read Order]](https://images.taxscan.in/h-upload/2025/06/24/2053919-recovery-warning-hc-taxscan.webp "No Participation in GST Adjudication: Madras HC Grants Final Opportunity to Assessee with Strict Recovery Warning [Read Order]")
The Madurai Bench of the Madras High Court has granted a final opportunity to an assessee who failed to engage with the adjudication process, but did so with stringent conditions.
The Court made it clear that failure to comply with its directions would revive the original tax demand and open the door for immediate recovery action.
Zion Agencies, filed a writ petition challenging an assessment order dated 12.12.2023 issued under the TNGST/CGST Act for the tax period 2017 18. According to the petitioner, the impugned order had been passed ex parte, without their participation in the adjudication process, despite issuance of multiple notices.
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The record revealed that notices had been issued in Form ASMT-10 on 30.06.2023 and 29.09.2023, followed by a DRC-01A notice dated 05.10.2023 and three personal hearing notices in November 2023. However, the petitioner had failed to respond or appear, resulting in an adverse assessment with a demand of ₹50,11,324, which was later communicated through a demand notice dated 12.03.2024.
JusticeC. Saravanan, noting that the petitioner had not participated in the proceedings, observed that in similar situations the Court had previously granted relief by quashing the assessment order conditionally subject to payment of 25% of the disputed tax. The judge found no reason to adopt a different approach in this case.
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Accordingly, the Court quashed the assessment order but imposed the condition that the petitioner must deposit 25% of the disputed tax from the electronic cash ledger within 30 days. Further, the petitioner must file a reply to the earlier show cause notice within the same period, treating the quashed order as an addendum to the original notice.
The Court directed the respondent officer to pass a fresh order on merits after granting the petitioner an opportunity of personal hearing. However, the judgment included a stern caveat: failure to comply with the deposit or to file the reply would result in the writ petition being deemed dismissed, allowing the department to initiate recovery proceedings without further delay.
