Rejection Of Tax Claim Alone Cannot Mean Concealment: ITAT Mumbai Deletes ₹1.23 Crore Penalty

The Income Tax Appellate Tribunal (ITAT), Mumbai, has held that merely because a taxpayer's claim is rejected, it does not mean the taxpayer concealed facts or gave a false explanation.The tribunal made the observation while deleting a ₹1.23 crore penalty imposed on Cyqurex Systems Pvt. Ltd. under Section 270A of the Income Tax Act. The penalty arose from the company's claim of ₹7.41 crore as revenue expenditure on software development.A bench comprising Judicial Member Challa Nagendra Prasad...

Madras High Court Acquits Woman, Says Non-Filing Of IT Return Not Wilful Without Tax Liability

The Madras High Court has acquitted a woman convicted for failing to file her income tax return, holding that the non-filing was not wilful where the Income Tax Department had failed to establish that she was liable to pay any tax.Justice Sunder Mohan observed that Section 276CC of the Income Tax Act makes the tax payable by the assessee relevant for determining whether prosecution for failure to file a return can be sustained. It held that, in the absence of any assessment or determination...

GSTAT Lucknow Quashes ₹6.62 Lakh Demand Against Jai Enterprises, Says Suspicion Can't Prove Tax Evasion

The Lucknow Bench of the Goods and Services Tax Appellate Tribunal (GSTAT) on 16 September held that tax and penalty cannot be sustained merely on an inference that goods had been transported earlier or that e-way bills had been reused without evidence establishing either. A Two-Member Bench comprising Judicial Member Santosh Kumar Srivastava and Technical Member Arvind Kumar allowed Jai Enterprises' appeal and set aside the order of the Additional Commissioner Grade-2 (Appeals), Kanpur, which...

CESTAT Kolkata Sets Aside ₹70.45 Lakh Service Tax Demand On Government Grants To Indian Chamber Of Commerce

The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Kolkata has set aside a ₹70.45 lakh Service Tax demand on grants received by the Indian Chamber of Commerce (ICC) from Central and State Governments. The tribunal held that the grants were not consideration for providing a taxable service and were more in the nature of reimbursement. The bench comprising Judicial Member R. Muralidhar and Technical Member K. Anpazhakan found no evidence that ICC provided “Business Exhibition...

CESTAT Allahabad Says Revenue Can't Retain Tax Paid By Mistake, Orders ₹36.92 Lakh Refund To SAF Yeast

On 1 October, the Allahabad Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) held that tax paid by mistake on an exempt service cannot be retained by the Revenue. Judicial Member P.K. Choudhary directed the Revenue to refund Rs. 36,92,166 to SAF Yeast Company Pvt. Ltd. with 12% annual interest from the respective dates of deposit until payment. It also directed that the refund be made within three months. The Tribunal observed: “The Revenue has no authority to retain...

GSTAT Ernakulam Holds 7-Day Limit Mandatory For Penalty Orders, Quashes Order Passed After 445 Days

The Ernakulam Bench of the Goods and Services Tax Appellate Tribunal (GSTAT), on 16 September held that the seven-day time limit under Section 129(3) of the Central Goods and Services Tax Act, 2017 and the Kerala Goods and Services Tax Act, 2017 for passing a penalty order is mandatory. A Bench comprising Vice-President Subramanya Rayaprol and Technical Member Ramamoorthi Sriram allowed the appeal filed by GMG Electric, Kochi against the order of the Joint Commissioner (Appeals), SGST...

GST Appeal Pre-Deposit Has No Impact On ITC Blocking Under Rule 86A Of CGST Rules: Madras High Court

The Madras High Court has held that making the mandatory pre-deposit for filing a GST appeal does not, by itself, require unblocking of Input Tax Credit (ITC) blocked under Rule 86A of the GST Rules. Justice Senthilkumar Ramamoorthy clarified that although the pre-deposit results in a deemed stay on recovery of the balance demand under Section 107(7) of the Central Goods and Services Tax Act, 2017 (CGST Act), it does not affect a separate blocking order under Rule 86A, and disposed of a...

LiveLawBiz Indirect Tax Quarterly Digest: July - September, 2026

SUPREME COURTSupreme Court Upholds Karnataka's Retrospective Withdrawal Of Sales Tax Exemption For Imported SugarCase Title : Asia Sugar & Chemical Co., Davangere v. State of Karnataka & Ors. Case Number : Civil Appeal No. 48 of 2009 CITATION : 2026 LLBiz SC 235The Supreme Court on Monday held that the Karnataka Legislature was competent to retrospectively withdraw the sales tax exemption available to imported sugar, but dealers who had acted under the earlier exemption regime cannot...

Calcutta High Court Quashes ₹1.68 Crore GST Demand Against SREI Equipment Finance After CIRP

The Calcutta High Court on 1 October allowed SREI Equipment Finance Limited's petition and quashed the Rs. 1.68 crore GST demand raised for alleged excess availment of integrated goods and services tax (IGST) input tax credit on imported goods for FY 2021-22. Justice Aryak Dutt held that tax authorities cannot initiate or continue proceedings for pre-resolution plan dues that were not lodged during the corporate insolvency resolution process (CIRP), as approval of the resolution plan...

ITAT Ahmedabad Deletes ₹18.76 Lakh Disallowance On Herbalife Distributor's Commission To Wife's Firm

On 1 October, the Ahmedabad Bench of the Income Tax Appellate Tribunal (ITAT) held that commission paid by a Herbalife distributor to his wife's proprietary concern cannot be treated as excessive or unreasonable merely by comparing it with a different line of business. Vice-President Dr. B.R.R. Kumar and Judicial Member Rahul Chaudhary deleted the Rs. 18.76 lakh disallowance made under Section 40A(2)(b) of the Income Tax Act, 1961, holding that the reasonableness of expenditure must be...

LiveLawBiz Direct Tax Quarterly Digest: July - September, 2026

SUPREME COURTSupreme Court Issues Notice On Revenue's Appeal Against HC's India-Singapore DTAA Relief To ST ShippingCase Title : ASSISTANT COMMISSIONER OF INCOME TAX Versus M/S ATLANTIC GLOBAL SHIPPING PVT. LTD. Case Number : Diary No. 25162-2026The Supreme Court on Wednesday issued notice in the Income Tax Department's appeal challenging a Gujarat High Court judgment that held ST Shipping Pte Ltd, Singapore was entitled to the benefit of Article 8 of the India-Singapore Double Taxation...

Calcutta High Court Quashes Pre-IBC Resolution Income Tax Proceedings Against Binani Cement

The Calcutta High Court has quashed income tax notices, orders, and proceedings relating to the period before UltraTech Cement took over management of Binani Cement under an approved IBC resolution plan. The Court held that claims not forming part of the resolution plan could not survive after its approval.The Court also directed the Income Tax Department to refund amounts adjusted against such pre-transfer tax demands, along with applicable interest.Justice Smita Das De was dealing with a writ...