Bombay High Court
GST Refund Cannot Be Rejected Without Considering Documents Already On Record: Bombay High Court
The Bombay High Court on 16 April set aside an order rejecting a GST refund claim after finding that the authorities failed to properly consider documents submitted by the taxpayer, including the Foreign Inward Remittance Certificate (FIRC). A Division Bench comprising Justices G. S. Kulkarni and Aarti Sathe held that when relevant documents are already placed on record, the refund claim must be examined fairly and through a reasoned order. It observed: “No prejudice would be caused to the...
Arbitral Award Sent To Last Known Address Is Valid Service; Limitation Runs From Attempted Delivery: Bombay HC
The Bombay High Court has reiterated that an arbitral award dispatched to a party's last known address amounts to valid service in law, even if the party does not actually receive it, and the limitation to challenge the award begins from the date of attempted delivery. Justice Sharmila U. Deshmukh held that, “Once the signed copy of the Award is shown to have been dispatched to the last known address of the Applicants, the same is sufficient to raise the deeming fiction under Section 3(2) and...
Bombay High Court Sets Aside Cap On Export Unit Tax Deduction Based On Sister Concern Profits
The Bombay High Court has held that deduction under Section 10B of the Income Tax Act, which grants tax relief to export-oriented units on profits derived from exports, cannot be restricted merely by comparing the assessee's profit margins with those of a sister concern, in the absence of any material establishing an arrangement to inflate profits. “The capping of the profit share of the Assessee on which deduction under Section 10B could be claimed at 19% solely on the basis of the sister...
Customs Public Notices Cannot Be Issued In A Manner Diluting FTA Benefits Or Overriding Law: Bombay HC
The Bombay High Court recently observed that Commissioner of Customs cannot issue public notices in a manner that dilutes the benefits under free trade agreements or overrides statutory provisions and CBIC circulars, while setting aside an order denying preferential duty to Covestro India Pvt. Ltd. The dispute arises from a public notice issued in March 2024 by the Commissioner of Customs at Nhava Sheva, which prescribed additional documentation requirements in cases involving third-party...
Homebuyer Labelled As 'Investor' To Undermine Rights: Bombay High Court Dismisses Developer Appeal
The Bombay High Court has dismissed a developer's second appeal, holding that it could not justify cancelling a flat allotment and pushing the homebuyer toward a refund by treating her as an "investor" instead of honoring the allotment. The court found that, in this case, calling the buyer an “investor” was not an innocent choice of words. She had already paid 30% of the price for a clearly identified flat. Describing her as an investor was a way to deny her the apartment and steer her toward a...
Bombay High Court Upholds RBI's 2019 Stressed Assets Framework, Finds No Arbitrariness
The Bombay High Court recently upheld the Reserve Bank of India's June 7, 2019 circular on the Prudential Framework for Resolution of Stressed Assets, refusing to interfere with the policy decision that repealed multiple earlier restructuring circulars. The court found no arbitrariness in the RBI's decision to withdraw earlier schemes, including those relating to corporate debt restructuring, restructuring of advances by banks, and restructuring of dues of small and medium enterprises, holding...
Bombay HC Flags 'Judicial Chaos,' Urges Uniform Litigation Policy Over Contradictory Stands Taken by Tax Depts
The Bombay High Court has recently flagged a persistent issue of the tax and customs department taking inconsistent stands on the same legal question before different High Courts, warning that such conduct leads to “judicial chaos” and needs correction through a uniform litigation policy. A bench of Justice G. S. Kulkarni and Justice Aarti Sathe held that once a legal issue has reached finality against the department, it cannot be reopened elsewhere by taking a contrary stand. The court...
Bombay High Court Allows Delay Condonation For Charitable Trust IT Filing, Attributes Delay To CA Lapse
The Bombay High Court has set aside an order rejecting a charitable trust's request to excuse a delay in filing Form 10, holding that a lapse on the part of its Chartered Accountant could not be used to deny the trust tax exemption under Section 11 of the Income Tax Act. A Bench of Justice B.P. Colabawalla and Justice Firdosh P. Pooniwalla said, “the Petitioner Trust would suffer grave hardship if the delay is not condoned since the Petitioner Firm would be saddled with a huge tax liability for...
Bombay High Court Quashes Infinx GST Refund Rejection After Hearing Adjournment Denied Despite Heavy Rains
The Bombay High Court has set aside a GST refund rejection against Infinx Services Private Limited, finding that the tax department shut the company out of the process by deciding the case without giving it a hearing, even after it asked for time citing heavy rains in Mumbai. A Bench of Justice G. S. Kulkarni and Justice Aarti Sathe held that the order had been passed without affording a personal hearing despite a specific request to reschedule the hearing on account of heavy rains in the city....
Stockbroker Cannot 'Wriggle Out' Of Liability For Agent's Unauthorized Acts: Bombay High Court
The Bombay High Court on 21 April, held that a stockbroker remains liable for unauthorised and fraudulent trades executed by its sub-brokers and agents, particularly where such acts arise in the course of agency and result in abnormal brokerage gains at the client's expense. Justice Arun R. Pedneker upheld the arbitral award directing IIFL Capital Services Limited to pay Rs. 14.37 lakh to investor Sukhadeo Gorakha Bhil and dismissed the appeal filed under Section 37 of the Arbitration and...
Input Tax Credit Blocking Cannot Continue Beyond One Year From Imposition: Bombay High Court
The Bombay High Court has recently reiterated that a restriction on utilization of Input Tax Credit in the Electronic Credit Ledger cannot continue beyond one year from the date of its imposition. A division bench of Justices G.S. Kulkarni and Aarti Sathe, examining Rule 86A(3) of the Central Goods and Services Tax Rules, 2017, observed, "Having heard learned Counsel for the parties and having perused the record, we are of the considered view that there appears to be much substance in the...