Rajasthan High Court Sets Aside Unsigned GST Notice And ₹3.13 Lakh Demand Against Mayur Timber

The Rajasthan High Court on 11 August set aside an unsigned Goods and Services Tax (GST) show-cause notice and consequential demand of over Rs. 3.13 lakh raised against Mayur Timber, along with interest of Rs. 4,26,002 and an equivalent penalty. A Division Bench comprising Justices Arun Monga and Ashutosh Kumar held that mere generation of a document on the GST portal or allotment of a reference number cannot replace the mandatory requirement of authentication under Rule 26(3) of the Central...

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,...

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...

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...

GST Authority Finding In Assessment Proceedings May Affect Criminal Case: Allahabad High Court

The Allahabad High Court on 11 August held that where assessment proceedings under the Central Goods and Services Tax Act, 2017 end in a finding that a taxpayer has not violated the law, such finding may have a bearing on criminal prosecution arising from the same allegations, even though the two proceedings are independent. Justice Vikram D. Chauhan made the observation while granting bail to Javed Akhtar, who was accused of fraudulently availing input tax credit, noting that no proceedings...

Delhi High Court To Decide Constitutional Validity Of Cess On Pan Masala Manufacturers

The Delhi High Court is set to examine the constitutional validity of the levy of compensation cess on pan masala manufacturers under the Health Security se National Security Cess Act, 2025.The Division Bench of Justices Anil Kshetarpal and Shail Jain has listed for final disposal two petitions filed by Dharampal Satyapal Ltd. and the Smokeless Tobacco Association challenging the levy of compensation cess on pan masala and its constitutional validity. The matters will be heard on September...