100 % Penalty cannot be imposed if Show Cause Notice is issued under section 73
In the High Court of Judicature at Madras
W.P. No. 1848 of 2024
and W.M.P. Nos. 1921, 1922 of 2024
Date of Decision: 31.01.2024
Coram: The Honourable Mr. Justice Senthilkumar Ramamoorthy
Petitioner: K.S. Janarthanam,
No.5/9, 2nd Street,
Mahalakshmi Nagar,
Karambakkam, Porur,
Chennai 600 116.
Respondent: The Deputy State Tax Officer I,
O/o. The Assistant Commissioner (ST),
Porur Assessment Circle,
Ponnamallee Zone,
Kancheepuram Division
No.4/109 Chennai-Bangalore Highways,
Nazarathpet,
Chennai 600 123.
Prayer: Writ Petition filed under Article 226 of the Constitution of India, praying to issue a Writ of Certiorari calling for the records of the Respondent in Reference Number. ZD331223007959D dated 01.12.2023 and quash the same as arbitrary, illegal.
Order
1. The petitioner contested an order dated 01.12.2023 pertaining to a rectification application filed on 20.11.2023.
2. The petitioner, a civil works contractor and registered under GST laws, admitted a tax liability of Rs. 12,22,432 (CGST: Rs. 6,71,216; SGST: Rs. 6,71,216), seeking relief from penalty.
3. Despite the rectification application, the impugned order imposed a 100% penalty on SGST dues.
4. The Government Advocate acknowledged the issuance of the order based on the rectification application.
5. Upon scrutiny, it was evident that the notices were issued under Section 73, not Section 74, of the TNGST Act, warranting intervention in the penalty imposition.
6. Consequently, the High Court quashed the order’s imposition of penalty under SGST dues and remanded the matter to the assessing officer for reconsideration.
7. The assessing officer was directed to afford a reasonable opportunity to the petitioner and complete the reconsideration within two months from the receipt of the court’s order.
8. W.P. No. 1848 of 2024 was disposed of accordingly, and related miscellaneous petitions (W.M.P. Nos. 1921, 1922 of 2024) were closed.
Date: 31.01.2024
(2/2)
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To:
The Deputy State Tax Officer I,
O/o. The Assistant Commissioner (ST),
Porur Assessment Circle,
Ponnamallee Zone,
Kancheepuram Division
No.4/109 Chennai-Bangalore Highways,
Nazarathpet,
Chennai 600 123.
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The copy of the order is as under:
