S.107 CGST Act | GST Appellate Authority Can Conduct Further Inquiry, Permit Cross-Examination: Delhi High Court

The Delhi High Court has held that the appellate authority under Section 107 of the Central Goods and Services Tax (CGST) Act, 2017 is empowered to conduct such further inquiry as may be necessary while deciding an appeal and, in an appropriate case, can permit cross-examination of witnesses, notwithstanding the statutory bar on remanding matters to the adjudicating authority.The Division Bench of Justices Anil Kshetarpal and Shail Jain made the observation while refusing to entertain a writ...

Delhi High Court Declines Writ Against Ex Parte GST Order, Cites Statutory Appeal

The Delhi High Court has declined to entertain a writ petition challenging an ex parte GST adjudication order. It observed that disputed questions of fact relating to the validity and sufficiency of service of notices under Section 169 of the Central Goods and Services Tax Act, 2017, are more appropriately examined by the statutory appellate authority. A division bench of Justices Anil Kshetarpal and Amit Mahajan was hearing a challenge to an order that imposed a penalty of over ₹2.39 crore on...

Delhi High Court Rejects Revenue's Plea Against SpiceJet Over Foreign Currency Convertible Bond Tax Dispute

The Delhi High Court has dismissed two appeals filed by the Income Tax Department against SpiceJet Ltd., holding that the tax treatment of premium payable on redemption of Foreign Currency Convertible Bonds (FCCBs) is a settled issue.A division bench of Justices Dinesh Mehta and Rajneesh Kumar Gupta observed that the issue raised by the Revenue—whether the expenditure on FCCB redemption premium ought to be spread over the five-year life of the bonds instead of being claimed in the first...

Delhi High Court Sets Aside ₹16.74 Crore Tax Disallowance Enhancement Against Sahara India Over Lack of Notice

The Delhi High Court has held that the Commissioner of Income Tax (Appeals) cannot enhance a tax disallowance without first issuing a statutory notice to the assessee, observing that failure to do so violates both Section 251(2) of the Income Tax Act, 1961 and the principles of natural justice.The division bench of Justices Dinesh Mehta and Rajneesh Kumar Gupta thus set aside the enhancement of a disallowance from ₹11.05 crore to ₹16.74 crore made against Sahara India Commercial Corporation...

Delhi High Court Admits Appeal On Taxability Of Demonetisation-Era Cash Deposits

The Delhi High Court has admitted the Income Tax Department's appeal against an ITAT order deleting additions to income based on an assessee's cash deposits made during the demonetisation period.A Division Bench of Justices Dinesh Mehta and Rajneesh Kumar Gupta agreed to examine whether the Tribunal rightly deleted the addition under Section 69A of the Income Tax Act, relating to cash deposits made during the demonetisation period, despite the Revenue's contention that the deposits were...

Delhi High Court Stays Draft Assessment Order Against American Express, Admits Transfer Pricing Appeal

The Delhi High Court has stayed the operation of a draft assessment order passed against American Express Banking Corporation (India Branch) while admitting the company's income tax appeal raising multiple questions of law relating to transfer pricing adjustments, including the validity of the Bright Line Test (BLT) and the Transfer Pricing Officer's (TPO) methodology.A division bench of Justices Dinesh Mehta and Rajneesh Kumar Gupta noted that by an interim order dated May 29, 2026, it had...

Director Must Prove He Was Not Responsible For Company's Unpaid VAT: Kerala High Court

The Kerala High Court has recently held that when tax authorities seek to recover a company's tax dues from one of its directors under the Kerala Value Added Tax (KVAT) Act, the burden is on the director to prove that the non-recovery was not caused by his negligence, misfeasance or breach of duty.",,as per Section 39 of the KVAT Act, the onus to prove that the non-recovery was not on account of negligence, misfeasance or breach of duty attributable to the Director, is on the said person and not...

CENVAT Credit Cannot Be Denied Solely Because Running Account Bills Are Not Invoices: CESTAT Delhi

The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), New Delhi has held that CENVAT credit cannot be denied merely because running account bills are not conventional invoices, provided they contain the prescribed particulars required under law. Observing that, "The crux of the matter is that the authority needs to be satisfied about the relevant details/particular and not the form of the document," the tribunal ruled in favour of the Rajasthan Housing Board.Judicial Member Binu Tamta...

GST Penalty Order Passed Beyond 7 Days Of Show Cause Notice Is Invalid: Jammu & Kashmir and Ladakh High Court

The Jammu & Kashmir and Ladakh High court has held that the seven-day timeline prescribed under Section 129(3) of the Jammu & Kashmir Goods and Services Tax Act, 2017 for passing a penalty order is mandatory. It ruled that a penalty order passed even a day beyond the statutory period cannot be sustained. A Division Bench of Acting Chief Justice Sanjeev Kumar and Justice Mohd Yousuf Wani observed that where the legislature has used the word "shall" while prescribing timelines for the...

Bombay High Court Quashes Criminal Prosecution For Late ITR Filing As Taxpayer Entitled To Refund

The Bombay High Court on 22 July held that criminal prosecution for failure to file an income tax return cannot continue when a subsequent assessment shows that the taxpayer had no tax liability and was instead entitled to a refund, as continuing such proceedings would serve no purpose where the Revenue suffered no loss. Justice Madhav J. Jamdar quashed the criminal complaint that the Income Tax Department filed against Rajesh Somandas Sachdev under Section 276CC of the Income Tax Act (which...

ITC Can Be Denied To Buyer If Supplier Fails To Pay Tax: Supreme Court Upholds S.16(2)(c) Of CGST Act

The Supreme Court has recently upheld the Gujarat High Court's judgment sustaining the constitutional validity of Section 16(2)(c) of the Central Goods and Services Tax Act, 2017. In doing so, it affirmed that a registered purchaser cannot claim Input Tax Credit (ITC) unless the supplier has actually paid the tax charged on the underlying supply to the government.Upholding the High Court's judgment, the court observed, "High Court was fully justified in holding that no grounds were made out to...

Telangana High Court Upholds Mayuri Film's Tax Benefit, Says Unrescinded Notification Can't Be Overridden

The Telangana High Court on 24 July held that a tax concession granted through a Government notification cannot be withdrawn merely because a new entry is introduced in a tax schedule, unless the notification granting the benefit is expressly withdrawn, superseded or rescinded. A Division Bench of Justices P. Sam Koshy and Suddala Chalapathi Rao upheld the concessional sales tax benefit claimed by Mayuri Film Distributors on the sale of audio cassettes, holding that the Government Order...