Judge kumarappan Madras HC Dismisses Petition No Perversity or Bias in Disciplinary Findings Against Commercial Taxes Officer:

Home »Top Stories »No Perversity or Bias… No Perversity or Bias in Disciplinary Findings Against Commercial Taxes Officer: Madras HC Dismisses Petition No Perversity or Bias in Disciplinary Findings Against Commercial Taxes Officer: Madras HC Dismisses Petition By – Kavi Priya | 30 Aug 2025 12:20 PM In a recent ruling, the Madras High Court held that there was no perversity or bias in the disciplinary findings against a Commercial Taxes officer. The court dismissed his challenge to the penalty imposed on him. V. Mahendhiran, the petitioner, was serving as an Assistant Commissioner of Commercial Taxes when a charge memo was issued against him on 16 November 2009. Four charges were framed, including failure to scrutinize 365 returns for January 2008 despite directions, refusal to receive a departmental memo on 13 June 2008, etc. The Enquiry Officer held all charges proved, and by order dated 25 July 2012, the Disciplinary Authority imposed the penalty of stoppage of increment for two years without cumulative effect. The petitioner’s appeal was rejected by order dated 12 November 2024, which led him to approach the High Court. Step by Step Guide of Preparing Company Balance Sheet and Profit & Loss Account Click Here Fault Lies with Auditor, Not Assessee or GST Dept: Madras HC Quashes Ex Parte Order Passed for Non-Reply [Read Order] The petitioner’s counsel argued that there was a delay of nearly 31 months between the charge memo and the enquiry report, that the findings were contrary to evidence, and that the punishment was disproportionate to the charges. They also argued that the Appellate Authority did not properly consider the petitioner’s submissions and that interference by the Court was justified. The State’s counsel argued that the findings were supported by material on record, that no bias or perversity was shown and that the punishment was appropriate and lenient in nature. GST READY RECKONER: Complete Topic wise Circulars, Instructions & Guidelines Click here ₹11 crore GST Evasion case: Jharkhand HC grants Bail considering Prolonged Period of Custody [Read Order] The single-judge bench comprising Justice C. Kumarappan observed that the petitioner had failed to scrutinize the returns as required under official circulars, had shown insubordination in not receiving the memo, and had performed poorly in the refresher test. The court pointed out that although there was a delay in the disciplinary process, the petitioner did not show any prejudice caused by such delay. The court explained that in judicial review, it cannot reappreciate evidence, and interference is limited to cases of perversity or shockingly disproportionate punishment. The court held that the penalty of stoppage of increment for two years without cumulative effect was not disproportionate and was, in fact, lenient. The writ petition was dismissed and the disciplinary punishment was allowed to stand. Support our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates Subscribe Taxscan Premium to view the Judgment Kavi Priya Content writer at Taxscan with a passion for clear, engaging legal content. I simplify tax and law topics while sharpening my research and communication skills. Commercial Taxes Officer Madras HC Next Story Supreme Court to Decide if Chartered Flights are Passenger Transport or Aircraft Hire, Impacting GST ITC [Read Order] Supreme Court to decide if chartered flights are “passenger transport” or “tangible goods” for GST ITC By – Kavi Priya | 30 Aug 2025 5:25 PM The Supreme Court of India is set to examine whether services provided through chartered aircraft fall under “Non-Scheduled Air Transport (Passenger) Service” or should be treated as “Supply of Tangible Goods for Use (STGU)”, a distinction that carries significant tax implications. The case arises from agreements between Reliance Commercial Dealers Ltd. (RCDL) and Reliance Industries Ltd. (RIL) in 2008 and 2009, under which RCDL, holding a Non-Scheduled Operator’s Permit (NSOP) from the DGCA, provided aircraft to transport RIL’s executives and nominees on a “right of first refusal” basis. Click Here: Complete practical guide to Drafting Commercial Contracts The revenue department argued that the arrangement amounted to a charter hire of aircraft under Supply of Tangible Goods for Use (STGU) under Section 65(105)(zzzzj) of the Finance Act, 1994) and demanded service tax exceeding Rs. 42 crore for 2008–2011. The Commissioner accepted this view and confirmed tax, interest, and penalties. On the other hand, the company argued that it was providing non-scheduled passenger air transport services under Section 65(105)(zzzo) since it did not transfer possession or control of the aircraft to RIL, and charges were based only on actual flying hours. The two-member bench comprising S.K. Mohanty (Judicial Member) and M.M. Parthiban (Technical Member) observed that chartering the entire aircraft for specific journeys still constituted passenger transport service, not a supply of tangible goods, and quashed the tax demands and penalties. Click here: Complete GST Act & Rules with amendments made by financial bill, 2025 In its final order, the tribunal pointed out that the Civil Aviation Requirements (CAR) permit issued by DGCA allowed RCDL to provide non-scheduled passenger services, either per seat or by full charter, and such operations could not be reclassified as STGU. The CESTAT ruled in favour of the Reliance Commercial Dealers Ltd. With the matter now pending before the Supreme Court (Civil Appeal No. 9743/2025), the Court’s decision will determine whether chartered flights are to be regarded as passenger transport (enabling GST input tax credit) or as a supply of tangible goods (where ITC is blocked). Support our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates Subscribe Taxscan Premium to view the Judgment Kavi Priya Content writer at Taxscan with a passion for clear, engaging legal content. I simplify tax and law topics while sharpening my research and communication skills. 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