Facts of the Case

The petitioner, Tvl. Delux Super Market, challenged an assessment order dated 26.02.2025 for financial year 2020-21, passed under Section 73 of the TNGST Act following a DRC-01A notice dated 26.11.2024, to which the petitioner had replied and also attended the personal hearing. Aggrieved, the petitioner filed a statutory appeal under Section 107, but with a marginal delay of 15 days beyond the condonable period of limitation. The appeal was accordingly rejected in limine vide Form GST APL-02 dated 10.07.2025. The petitioner then approached the Madurai Bench of the Madras High Court, also contending that the confirmed demand exceeded the scope of what was proposed in the original DRC-01 notice.

Issues Involved

  1. Whether an appeal rejected in limine for a marginal 15-day delay beyond the condonable period should be restored and heard on merits.
  2. Whether a demand confirmed in an assessment order, going beyond the scope of the demand proposed in the preceding show cause notice, is sustainable.

Petitioner's Arguments

  • The demand confirmed in the assessment order dated 26.02.2025 exceeded the scope of the demand proposed in the DRC-01 notice dated 26.11.2024.
  • Reliance was placed on the Division Bench ruling in Tvl. GLO Shipping Logistics Pvt. Ltd. v. State Tax Officer, (2025) 29 Centax 292 (Mad.), which held that a demand confirmed in excess of the amount specified in the SCN, and involving disputed questions of limitation/jurisdiction, should be examined by the assessing authority itself, with the taxpayer free to raise limitation and jurisdiction as defences.
  • The delay of only 15 days beyond the condonable period should not have resulted in outright, in-limine rejection of the appeal.

Respondent's Arguments

  • No specific contesting submission is separately recorded from the Government Advocate; the petition proceeded on the marginal-delay and scope-of-SCN grounds.

Court Order / Findings

  • The Court extracted and relied on the GLO Shipping Logistics precedent, which held that where a confirmed demand exceeds the SCN's scope by treating the taxpayer differently (e.g., as an 'Intermediary'), the question of limitation coupled with jurisdiction should be examined by the assessing authority based on the taxpayer's reply, rather than being used to non-suit the taxpayer at the threshold.
  • Considering that the petitioner had made out a case and that the delay was only marginal (15 days), the Court quashed the order dated 10.07.2025 rejecting the appeal in limine.
  • The Deputy Commissioner (GST Appeals) was directed to dispose of the appeal on merits and in accordance with law, without reference to limitation, and was suo motu impleaded as a party since the petitioner had not originally arrayed the appellate authority.
  • Since the petitioner had already pre-deposited 10% of the disputed tax, the bank account attached pursuant to the impugned order was directed to be vacated forthwith.

Important Clarification

  • A marginal delay of a matter of days beyond the condonable period under Section 107 need not result in an in-limine rejection of a GST appeal; courts will direct the appeal be entertained and decided on merits where the taxpayer otherwise makes out a case, particularly where the underlying demand is alleged to travel beyond the scope of the preceding show cause notice.

Sections Involved

  • Section 73, TNGST Act, 2017 – determination of tax not paid, applicable to the underlying demand.
  • Section 107, CGST/TNGST Act, 2017 – appeal to the Appellate Authority, including limitation and its condonable period.
  • Form GST DRC-01A & APL-02 – pre-notice intimation and the appellate rejection communication respectively.

Decision – In Favour of

Disposed of in favour of the Assessee; the in-limine rejection of the appeal was quashed, the appeal restored for hearing on merits, and the bank attachment vacated.

Case Details

Madurai Bench of Madras High Court; W.P(MD)No.21402 of 2025 with W.M.P(MD)No.16526 of 2025; Coram: Hon'ble Mr. Justice C. Saravanan; Order dated 06.08.2025.

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