Manavalan Govindanaidu Vs The Assistant Commissioner… — Writ and Judicial Review | Madras HC (2026)

Manavalan Govindanaidu Vs The Assistant Commissioner… — Writ and Judicial Review | Madras HC (2026)

What the court decided

AI extract

Outcome

Writ petition disposed of at admission with consent: matter remitted to the Respondent for fresh adjudication on merits subject to 10% pre-deposit within 30 days, filing of reply to the DRC-01 notice, lifting of bank attachment on compliance, fresh order subject to the pending Supreme Court decision on seigniorage fee/royalty, with recovery as if dismissed in limine on default; no costs; connected writ miscellaneous petitions closed.

Issue for consideration

Whether the impugned Show Cause Notice/Order dated 18.08.2025 proposing tax on RCM on seigniorage fee, GSTR-3B outward-supply mismatch and non-raising of e-way bills should be quashed or instead remitted for de novo adjudication, given the Petitioner's failure to reply. +1 more

Court's answer

The writ was disposed of at the stage of admission itself, with the consent of counsel for both sides, rather than being adjudicated or quashed outright.

Ratio / Principle

The case was remitted to the Respondent for a fresh adjudication on merits, conditioned on the Petitioner depositing 10% of the tax liability proposed in the impugned Show Cause Notice, in cash or from the Petitioner's Electronic Cash Register, within thirty (30) days of receipt of the order.

Key takeaways

The Revenue shall pass a fresh order in respect of the impugned order dated 18.08.2025, subject to the decision of the Hon'ble Supreme Court on the seigniorage fee / royalty payable to the Government for minerals.ratio¶8
Under similar circumstances the court's practice has been to remit matters on terms with deposits ranging from 10% to 100% of the tax liability depending on the length of delay in approaching the court; no reason was found to take a different view here.obiter¶6

Detailed headnote1 paragraphs

Madras High Court (C.Saravanan J.) disposed of, at admission and with consent, a writ petition challenging a GST order/Show Cause Notice dated 18.08.2025 (Form GST DRC-01, Ref. No.ZD330825176011M) raising demands on RCM on seigniorage fee, GSTR-3B outward-supply mismatch and non-raising of e-way bills, on which the assessee had filed no reply. The matter was remitted to the Assistant Commissioner (ST) (FAC)/CTO, Kancheepuram (Rural), for de novo adjudication on merits, conditional on the assessee pre-depositing 10% of the proposed tax liability (cash/Electronic Cash Register) within 30 days, filing a reply with documents, and clearing arrears; the bank attachment was to be lifted on compliance, failing which recovery could proceed as if the writ were dismissed in limine. The fresh order is to be subject to the Hon'ble Supreme Court's decision on seigniorage fee / royalty payable to the Government for minerals. No costs; connected W.M.Ps. closed.

W.P.No.3410 of 2026

IN THE HIGH COURT OF JUDICATURE AT MADRAS

DATED : 03.02.2026

CORAM :

THE HONOURABLE MR.JUSTICE C.SARAVANAN

W.P.No.3410 of 2026

and W.M.P.Nos.3839 and 3841 of 2026

Manavalan Govindanaidu ... Petitioner

Vs.

The Assistant Commissioner (ST) (FAC) / Commercial Tax Officer Kancheepuram (Rural) Asessment Circle 1^st Floor Commercial Tax Office, Collectorate Campus, Kanchipuram 631 501.

... Respondent

Prayer: Writ Petition filed under Article 226 of the Constitution of India, for issuance of a Writ of Certiorari, to call for the records of the impugned Order issued by the Respondent in GST/33EGDPM5605Q1Z1/2022-23 dated 18.08.2025 along with impugned Order and Summary of Order in Form GST DRC-01 bearing Reference No.ZD330825176011M dated 18.08.2025 and quash the same.

For Petitioner : M/s.Rukmani Venugopalan For Respondent : Mrs.P.Selvi, Government Advocate ************

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W.P.No.3410 of 2026

ORDER

Mrs.P.Selvi, learned Governmnet Advocate takes notice for the

Respondent.

This Writ Petition is being disposed of at the stage of admission

itself with the consent of the learned counsel for the Petitioner and the learned Government Advocate for the Respondent.

In this Writ Petition, the Petitioner has challenged the impugned Show Cause Notice dated 18.08.2025, wherein the tax liability on account of RCM on Seignorage fee, mismatch in outward supply (Form GSTR-3B) and Non-raising of e-way bill for outward supply has been prposed against the petitioner.

It is noticed that the Petitioner had failed to file a reply to the aforesaid Show Cause Notice.

At this stage, the learned counsel for the Petitioner submits that

the Petitioner is willing to pre-deposit 10% of the tax liability as a condition for denovo adjudication.

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W.P.No.3410 of 2026

Under similar circumstances, cases have been remitted back to

the Respondent to pass an order on terms subject to such Assessee depositing 10% to 100% of the tax liability depending upon the length of delay in approaching the Court. I do not find any reason to take a different view in this case.

Therefore, to balance the interest of both parties viz., the Assessee and the Revenue, the case is remitted back to the Respondent to pass order on merits subject to the Petitioner depositing 10% of the tax liability porposed vide impugned Show Cause Notice in cash or from the Petitioner's Electronic Cash Register within a period of thirty (30) days from the date of receipt of a copy of this order.

The Revenue shall pass a fresh order in respect of the impugned order dated 18.08.2025, subject to the decision of the Hon’ble Supreme Court on the Seigniorage fee / royalty payable to the Government for the minerals.

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W.P.No.3410 of 2026

Within such time, the Petitioner shall also file a reply to the Show Cause Notice in GST DRC-01 dated 18.08.2025 together with requisite documents to substantiate the defence.

It is made clear that bank attachment shall be lifted subject to the Petitioner depositing 10% of the tax liability as ordered above and the Petitioner not being in arrears of any other amount for any other tax period barring the amount demanded under the impugned Order.

In case the Petitioner fails to comply with any of the stipulations, the Respondent is at liberty to proceed against the Petitioner to recover the tax in accordance with law as if this Writ Petition was dismissed in limine today.

Needless to state, before passing any such order, the Respondent

shall give due notice to the Petitioner.

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W.P.No.3410 of 2026

This Writ Petition stands disposed of with the above observations. No costs. Connected Writ Miscellaneous Petitions are closed.

03.02.2026

nvi Neutral Citation: Yes / No

To:

The Assistant Commissioner (ST) (FAC) / Commercial Tax Officer Kancheepuram (Rural) Asessment Circle 1^st Floor Commercial Tax Office, Collectorate Campus, Kanchipuram 631 501.

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W.P.No.3410 of 2026

C.SARAVANAN, J.

nvi

W.P.No.3410 of 2026 and W.M.P.Nos.3839 and 3841 of 2026

03.02.2026

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