The Madras High Court ruled that GST authorities cannot issue two separate assessment orders for the same taxpayer, discrepancies, and assessment year. This decision came in response to a case involving M/s. Abarna Enterprises, which challenged two GST assessment orders for FY 2021-22 issued by the State Tax Officer. The orders were based on alleged discrepancies such as mismatches between GSTR-3B and GSTR-1 turnover, excess ITC claims compared with GSTR-2A, and late filing fees. The petitioner attributed these errors to incorrect reporting by its GST consultant.
M/s. Abarna Enterprises argued that it was unable to respond to the show cause notices due to the cancellation of its GST registration and the fact that notices were only uploaded on the GST portal without further communication. The Court found that issuing two separate orders for the same period was legally unsustainable and quashed the first order dated 09.10.2025, allowing proceedings to continue under the second order.
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In reviewing the second order, the Court acknowledged that the assessment was conducted ex parte because the petitioner did not participate in the proceedings. However, considering the explanation regarding the cancellation of GST registration and lack of proper notice, the Court decided to remand the matter back to the assessing authority. The Court directed the authority to reconsider the case, allowing the petitioner another opportunity to submit documents and explanations, especially since 46% of the disputed tax had already been recovered.
Order Date - 20 April 2026
Parties: M/s. Abarna Enterprises Vs Deputy State Tax Officer-1 / Deputy Commercial Tax Officer, Tuticorin-I Assessment Circle
Facts -
- M/s. Abarna Enterprises challenged two separate GST assessment orders passed for FY 2021-22 by the State Tax Officer relating to the same GSTIN and largely similar discrepancies.
- The Department alleged mismatch between GSTR-3B and GSTR-1 turnover, excess ITC claim compared with GSTR-2A, and late filing fee liability. The petitioner claimed these errors occurred because of wrong reporting by its GST consultant.
- The petitioner stated that it could not respond to the show cause notices because its GST registration had already been cancelled and notices were uploaded only on the GST portal without any further communication.
- One writ petition challenged duplication of proceedings for the same tax period, while the other sought another opportunity to explain the discrepancies and submit supporting documents before the assessing authority.
Issue -
- Whether two separate GST assessment orders could be passed for the same assessment year?
Order -
- The Court observed that both impugned orders related to the same assessment year, namely FY 2021-22, and substantially covered the same discrepancies. Therefore, passing two separate assessment orders for the same taxpayer and same period was legally unsustainable.
- The Court quashed the first assessment order dated 09.10.2025 because the second order already covered the same issues along with additional discrepancies. The Department was permitted to continue proceedings only under the later assessment order.
- While examining the second order, the Court noted that the assessment was passed ex parte as the petitioner failed to participate in proceedings. However, considering the explanation regarding cancellation of GST registration and lack of proper notice, the Court found that another opportunity could be granted.
- The Court further considered that around 46% of the disputed tax had already been recovered from the petitioner. On equitable grounds, the matter was remanded back to the assessing authority with directions to reconsider the case afresh after giving the assessee proper opportunity to submit documents and explanations.
