Different Financial Years Cannot Be Clubbed In One Section 73 Show Cause Notice: Bombay High Court

The Bombay High Court on 28 August reiterated that demands for different financial years cannot be clubbed in a single show cause notice issued under Section 73 of the Central Goods and Services Tax Act, 2017 (CGST Act). A Division Bench of Justices Anil L. Pansare and Nivedita P. Mehta held that the statutory scheme treats each financial year as a separate tax period for assessment and recovery, with separate due dates and limitation periods. It therefore held that different financial years...

GST Cannot Be Levied On Penalty Imposed On TASMAC Employee For Stock Shortage: Madras High Court

The Madurai Bench of the Madras High Court on 14 August held that GST cannot be levied on a penalty imposed on an employee for shortage of liquor stock, observing that such a penalty arising from an employer-employee relationship cannot, by itself, be treated as a supply of service under GST law. A Division Bench comprising Justices M. Dhandapani and N. Dilip Kumar made the observation while dismissing an intra-court appeal filed by the Tamil Nadu State Marketing Corporation Limited (TASMAC)....

Patna High Court Says Permanent GST Registration Cancellation May Cause 'Civil Death' To Business

The Patna High Court on 28 August observed that permanent cancellation of GST registration may virtually result in the “civil death” of a business by preventing the taxpayer from carrying on business, while granting relief to Super Enterprises, whose GST registration was cancelled for failure to file returns for six months. A Division Bench of Justices Rajeev Ranjan Prasad and Ramesh Chand Malviya noted that Section 75(4) of the Bihar Goods and Services Tax Act, 2017, requires the authorities...

Bombay High Court Orders ₹3.14 Cr Pre-Deposit To IBM, Says Pending Appeal Can't Affect Dropped Demand

On 28 August, the Bombay High Court held that a taxpayer cannot be denied refund of the GST pre-deposit corresponding to a tax demand that has already been set aside, merely because it intends to challenge the remaining demand before the GST Appellate Tribunal. A Division Bench of Justices M.S. Karnik and Sandesh D. Patil allowed IBM India Pvt. Ltd.'s petition challenging the rejection of its claim for refund of Rs. 3.14 crore. The judge held:“It is pertinent to note that under the erstwhile...

Rajasthan High Court Says Supplier's Tax Payment Mandatory For ITC, Upholds Recovery From Buyer

The Rajasthan High Court on 17 August held that actual payment of tax by the supplier to the Government is a mandatory condition for availing Input Tax Credit (ITC) under Section 16(2)(c) of the Central Goods and Services Tax (CGST) Act, 2017, and that the credit can be recovered from the purchaser if the supplier fails to pay the corresponding tax. A Division Bench comprising Justices Dr. Pushpendra Singh Bhati and Praveer Bhatnagar dismissed a writ petition filed by Shree Karni Electrovision,...

Supreme Court Sets Aside GST Notice Against Tata Steel, Says 'Suppression' Must Have Factual Basis

The Supreme Court has set aside a GST show cause notice issued to Tata Steel Limited and the consequential Order-in-Original dated 26 December 2025, holding that the Department could not invoke the extended limitation period under Section 74 of the Central Goods and Services Tax Act, 2017 (CGST Act), merely by using the words “suppression of facts” without setting out the foundational facts supporting the allegation. A Bench of Justices J.B. Pardiwala and K. Vinod Chandran held that where the...

Deferred Annuity Payments To Road Companies Under NHAI Contracts Taxable Under GST: Rajasthan High Court

The Rajasthan High Court on 17 August upheld the levy of Goods and Services Tax (GST) on annuity payments received by road construction companies under concession agreements with the National Highways Authority of India (NHAI), holding that such deferred payments for works contract services cannot claim exemption merely because they are paid as annuities. A Division Bench of Justices Pushpendra Singh Bhati and Praveer Bhatnagar dismissed a batch of writ petitions filed by Nagaur Mukundgarh...

ITC Blockage Cannot Continue Beyond One Year Under CGST Rules: Madras High Court

The Madras High Court on 21 August held that a restriction on the use of Input Tax Credit (ITC) under Rule 86A of the Goods and Services Tax (GST) Rules cannot continue beyond one year. Justice S. Raveekumar directed the authorities to unblock the ITC of Metal Trade Incorporation, which had remained blocked for more than two-and-a-half years. He held: “the restriction was imposed on 27.01.2023 and more than 2 ½ years have passed. In view of the same, the restrictions on the blockage ceased to...

Supreme Court Says Extended GST Limitation Cannot Be Invoked Mechanically, Quashes G.R. Infra Notice

The Supreme Court on 19 August held that the extended limitation period under Section 74 of the Central Goods and Services Tax Act, 2017 cannot be invoked merely by mechanically using expressions such as “fraud”, “wilful misstatement” or “suppression of facts” in a show cause notice. A Bench of Justices J.B. Pardiwala and K. Vinod Chandran allowed an appeal filed by G.R. Infra Projects Limited, Ratlam, observing that the show cause notice itself must specify the allegations and circumstances...

GST Authorities Must Sell Seized Goods After Due Notice If Owner Does Not Appeal: Karnataka High Court

The Karnataka High Court held that Goods and Services Tax authorities must proceed with the sale of seized goods under Section 129(6) of the Central Goods and Services Tax Act, 2017 and Karnataka State Goods and Services Tax Act, 2017 after issuing due notice if the owner of the goods does not avail the available appellate remedy. Justice B.M. Shyam Prasad disposed of a writ petition filed by TPJ Carriers, a transporter, and directed the State GST authorities to bring the seized goods to sale...

Gujarat High Court Quashes GST Orders Based On AI-Generated Non-Existent Case Laws

The Gujarat High Court on 20 August quashed GST cancellation and appellate proceedings against Faiz Enterprise after finding that the State Tax Officer had relied exclusively on AI-generated case laws, including non-existent and irrelevant authorities. A Division Bench comprising Justices A.S. Supehia and Vaibhavi D. Nanavati held that adjudication proceedings cannot be sustained where an authority relies on unverified AI-generated case laws instead of independently applying its mind to the...

Supreme Court Dismisses GST Review Against Bharti Airtel And Others Over ITC On Telecom Towers

The Supreme Court on 19 August dismissed the Goods and Services Tax (GST) Department's review petition against Bharti Airtel Ltd, Indus Towers Ltd and Elevar Digitel Infrastructure Pvt Ltd, upholding the earlier dismissal of the Department's challenge to the Delhi High Court ruling on input tax credit (ITC) for telecom towers. A Bench of Justices Vikram Nath and Prasanna B. Varale found no error apparent on the face of the record warranting reconsideration of the Supreme Court's earlier order...