Madras HC Permits Time-Barred GST Appeal Subject to 25% Pre-Deposit in Maruti Novelty Case

Introduction

The strict application of statutory limitation periods often leaves an assessee without a remedy if they fail to challenge tax demands within the prescribed timeframe. However, the Madras High Court recently provided equitable relief in the case of Maruti Novelty Vs State Tax Officer. The Court permitted the assessee to bypass the expired limitation period and file an appeal under Section 107 of the applicable GST enactments, contingent upon a mandatory pre-deposit of 25% of the disputed tax liability.

Factual Matrix of the Dispute

The controversy stemmed from a tax assessment for the financial period of 2021-2022. The sequence of events that led to the judicial intervention is outlined below: