Goods and Services Tax

GST demand limitation bars late notices unless extended recovery is supported by foundational fraud or suppression facts.
Case-Laws
GST
GST demand limitation under Section 73 runs from the due date for the annual return; extensions of those due dates change its commencement, and pandemic-period exclusion must be applied when calculating the three-year period. A notice issued after the resulting deadline cannot be sustained under the ordinary limitation. Recourse to Section 74's five-year period requires the Assessing Officer's satisfaction, based on disclosed foundational facts, that fraud, wilful misstatement or suppression caused the tax shortfall or excess input tax credit. Audit objections and bare statutory assertions are insufficient. The show-cause notice and consequential order were set aside, with liberty for fresh Section 74 proceedings within the applicable extended limitation.
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Fair hearing in budgetary support claims requires an opportunity to explain input tax credit declaration discrepancies before determination.
Case-Laws
GST
Fair hearing in budgetary support claims requires the claimant to receive an opportunity to explain discrepancies between an input tax credit declaration and a Chartered Accountant certificate submitted at the respondents' direction. Where the declaration contains an asserted error, the officer must call for an explanation and consider supporting material before concluding the claim on merits. A claim cannot be finally determined merely by relying on the discrepant declaration without this opportunity. The challenged order was set aside to that extent, with directions to permit supporting documents and reconsider the claim after a reasonable hearing.
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Bail in fraudulent input tax credit allegations granted where investigation was nearly complete and further custody unnecessary.
Case-Laws
GST
Bail was granted to an accused alleged to have operated a firm used for fraudulent availment of input tax credit, although the firm was registered in his spouse's name. The High Court treated the investigation concerning the accused as almost complete and considered that certain co-accused had already received bail. Balancing the detention period against the nature and gravity of the allegations, it found that further custodial detention was unnecessary for the investigation. Release was subject to a bond and surety, monthly appearance before the Investigating Officer, and compliance until submission of the charge-sheet.
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Input tax credit time limits: Section 16(5) preserves entitlement where the relevant return was filed before the cut-off.
Case-Laws
GST
Section 16(5) of the Central Goods and Services Tax Act overrides section 16(4) and preserves input tax credit entitlement for specified financial years where the return under section 39 was filed by 30 November 2021. For Financial Year 2018-19, a return filed on 23 October 2019 fell within the preserved period. Denial of the related input tax credit was therefore impermissible, and the Order-in-Original denying the claim was set aside and quashed.
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GST/TDS non-deposit must follow the statutory GST framework; later substantive penal provisions cannot apply retrospectively to earlier defaults.
Case-Laws
GST
GST/TDS non-deposit arising from payments for Gram Sabha works falls primarily within the U.P. Goods and Services Tax Act, 2017, which provides a complete mechanism for determination of default, interest, penalty, prosecution and compounding. General penal provisions cannot be invoked unless allegations independently establish a distinct offence, such as dishonest misappropriation, forgery, cheating or wrongful gain. Substantive penal law applies prospectively: a penal provision introduced after the alleged 2017-18 default cannot create or alter the applicable offence. Proceedings based solely on Section 316(5) BNS were therefore unsustainable, while action under the GST Act remained available.
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Extended GST limitation requires specific fraud or suppression allegations in the show-cause notice; bare assertions invalidate proceedings.
Case-Laws
GST
Extended limitation under Section 74 of the CGST Act for fraud, wilful misstatement or suppression of facts requires the show-cause notice itself to disclose specific allegations and the factual basis supporting that inference. A bare reference to “fraud or concealment of facts” does not establish a valid basis for invoking the extended period, and deficiencies in the notice cannot be cured through a counter affidavit. Where the ordinary limitation period has expired, including applicable exclusion of time, an unsupported invocation of extended limitation renders the notice unsustainable. Further proceedings based on such a notice cannot continue.
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Assignment of long-term leasehold rights transfers benefits of immovable property and falls outside taxable GST supply.
Case-Laws
GST
Assignment by sale or transfer of long-term leasehold rights in land and building to a third-party assignee constitutes transfer of benefits arising from immovable property. The assignee replaces the original allottee as lessee. Such assignment falls outside taxable supply under section 7(1)(a), clause 5(b) of Schedule II and clause 5 of Schedule III of the GST law, and is therefore not liable to GST. On this basis, the GST order concerning the assignment was quashed and the writ petition was allowed.
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Assignment of long-term leasehold rights transfers immovable-property benefits and remains outside GST supply for third-party assignees.
Case-Laws
GST
Assignment of long-term leasehold rights in land and building to a third-party assignee transfers benefits arising from immovable property. Where the assignee replaces the original allottee as lessee, the transaction falls outside the scope of supply and is not liable to GST. Applying the binding ruling on comparable assignments, upheld by dismissal of the SLP, the High Court quashed the show cause notice and assessment order levying GST and allowed the writ petition.
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Inter-Commissionerate transfer for Executive Assistants fails where separate cadres lack rules permitting absorption into another Commissionerate.
Case-Laws
GST
Executive Assistants are not entitled to inter-Commissionerate transfer where each Cadre Controlling Authority maintains a separate cadre and the applicable Recruitment Rules provide no absorption by transfer into another Commissionerate. The transfer policy therefore applies to this cadre, and appointment in the transferee Commissionerate cannot be secured through inter-Commissionerate transfer. Transfers treated as deemed loan arrangements may consequently result in repatriation. A request for relaxation on medical grounds may be made by representation for consideration on its merits.
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Mandatory e-way bill generation before movement makes subsequent production ineffective against tax-evasion penalties for intercepted taxable goods.
Case-Laws
GST
Rule 138(1) requires prescribed information to be furnished and an e-way bill generated before taxable goods begin moving. Transport without an e-way bill at interception was treated as establishing intent to evade tax, because later online generation could not cure the failure of statutory monitoring or prevent potential account manipulation. A manually issued invoice was not regarded as an equivalent safeguard. The appellate authority's contrary reliance on precedent was distinguished, and the original tax and penalty order under the detention provisions was restored.
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E-way bill delay without evidence of tax evasion remains a procedural lapse, requiring penalty to be set aside.
Case-Laws
GST
Transportation of motorcycles without an e-way bill at interception was treated as a procedural lapse where the e-way bill was generated shortly thereafter and the transaction was fully traceable through invoices, challans, accounts, bank records, and vehicle identification details. No discrepancy in quantity, value or classification, nor evidence of suppression, undervaluation, fake documents, unaccounted goods or intent to evade tax, was identified. The penalty was therefore set aside, and the deposited amount was refundable in accordance with law, subject to verification and statutory requirements.
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Psyllium seed classification treats dried Isabgol as taxable rather than exempt fresh or chilled plant material
Case-Laws
GST
Psyllium seeds (Isabgol) supplied in natural, raw and unprocessed form after procurement through APMC auctions are classified under Customs Tariff sub-heading 1211 90 13. The seeds are treated as dried rather than “fresh” or “chilled” plants or plant parts and therefore do not qualify for exemption under the relevant entry for fresh or chilled goods under HSN 1211. The stated conclusion treats the supply as taxable at 5%, notwithstanding a conflicting reference to exemption for goods of seed quality.
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ED raids several places in UP, Haryana in GST fraud case; over Rs 1 crore cash seized
GST
Dated:- 24-8-2026
PTI
Lucknow, Aug 24 (PTI) The Enforcement Directorate on Monday carried out searches at multiple locations in Uttar Pradesh and Haryana as part of a money laundering investigation linked to a GST fraud case, officials said.

Nine premises in Muzaffarnagar and Ghaziabad in Uttar Pradesh, apart from those in Haryana's Faridabad, were searched under the provisions of the Prevention of Money Laundering Act (PMLA) leading to seizure of Rs 1.1 crore in cash from two locations in the two UP cities, they said.

The investigation is related to “fraudulent” availment of bogus Input Tax Credit (ITC).

The probe involves a

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Portal order discrepancies invalidated rectification rejection, requiring fresh reasoned consideration after hearing and prompt communication of the order.
Case-Laws
GST
Portal-generated order discrepancies and non-communication rendered the rejection of a rectification application legally untenable. The order-sheet recorded that the rejection order could not be generated because of portal technical glitches, while the purported order carried a later handwritten signature date, creating an unresolved inconsistency. The High Court quashed the rejection and remanded the rectification application to the competent authority for fresh, reasoned disposal after giving the petitioner an adequate hearing and promptly communicating the order.
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Input tax credit mismatch verification requires invoice scrutiny before confirming demand, requiring fresh adjudication after a hearing opportunity.
Case-Laws
GST
For input tax credit mismatches between FORM GSTR-3B and FORM GSTR-2A, the prescribed Circular requires the proper officer to obtain invoice details from the registered person and verify satisfaction of credit-availment conditions before confirming a demand. An ex parte demand was set aside because that verification had not occurred. Fresh consideration was directed on the taxpayer's representation, in compliance with the Circular and after a reasonable opportunity of hearing, without determination of the merits of the credit claim.
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GST appeal limitation runs from a timely rectification order, requiring refund appeals to be considered on merits.
Case-Laws
GST
GST appeal limitation must be computed from a reasoned rectification order under section 161 where the rectification application was filed within the prescribed period and duly decided. The rectification proceedings directly affect the limitation period for challenging rejection of a refund claim; the Appellate Authority cannot calculate limitation solely from the original adjudication order. Rejection of the refund appeals as time-barred on that basis was impermissible. The appellate orders were quashed, and the matters were remanded for fresh adjudication on merits after hearing the petitioners.
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GST proceedings against a deceased proprietor were quashed, preserving lawful recovery action against the legal heir.
Case-Laws
GST
GST show cause and demand proceedings initiated against a deceased sole proprietor, after death and cancellation of the proprietorship registration, cannot be sustained. The legal heir was unconnected with the business and unaware of proceedings conducted through the GST portal. The High Court quashed the notices and consequential demand order, while preserving the authority's right to commence proper proceedings in accordance with law against the legal heir for any outstanding demand.
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AI-generated case law reliance in a tax order triggers scrutiny of citation authenticity and relevance.
Case-Laws
GST
Reliance exclusively on AI-generated case laws in a State Tax Officer's order prompted High Court scrutiny. The AGP was directed to obtain instructions on whether the cited authorities exist and are relevant to the issue. Failing such instructions, the High Court indicated it would require the officer's personal presence. If the cited case laws are non-existent or do not remotely apply, the High Court indicated that appropriate action against the officer may follow. Instructions were required by the next hearing date.
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GST appeal delay condoned where unresolved factual questions required restoration of the statutory appeal for merits adjudication.
Case-Laws
GST
Condonation of delay in a GST appeal was granted despite filing beyond the period under section 107 because factual questions required appellate adjudication. Applying the approach in Simplex Infrastructures Ltd. in the peculiar circumstances, the High Court held that the taxpayer should receive a further opportunity to pursue the statutory appeal. The time-bar dismissal and consequential rectification order were quashed, and the appeal was restored for decision on merits after a proper hearing. All substantive contentions remained open.
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Electronic credit ledger blocking cannot create a negative input tax credit balance; excess restriction requires statutory recovery procedures.
Case-Laws
GST
Rule 86A permits only a temporary restriction on debiting input tax credit that is available in the electronic credit ledger when the rule is invoked and its conditions are met. Availability of credit is a condition precedent; the provision does not authorise authorities to create debit entries or impose a negative ledger balance. Blocking was therefore invalid to the extent it exceeded the credit then available. Wrongly availed or utilised credit must instead be recovered through the statutory remedies available under law.
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Cum-tax valuation of post-composition supplies requires tax extraction from invoice values where tax was not separately collected.
Case-Laws
GST
Composition-scheme eligibility lapses automatically on the day aggregate turnover exceeds the prescribed threshold. Supplies made thereafter are taxable under the regular scheme, with adjustment for composition tax paid on post-lapse turnover; the cessation of composition eligibility was sustained. For post-lapse supplies where tax was not separately collected, invoice values must be treated as tax-inclusive because a composition taxpayer cannot collect tax separately and no additional collection was alleged. Rule 35 requires extraction of the tax component from the cum-tax value. Differential tax, and consequential interest and penalty, must therefore be recomputed on that basis.
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GST appeal limitation permits exclusion for bona fide rectification proceedings, but rectification does not automatically restart the appeal period.
Case-Laws
GST
For GST appeals, limitation under Section 107 runs from communication of the specific order challenged and is not automatically suspended or restarted by a rectification petition. Statutory condonation limits cannot be enlarged through principles underlying Section 5 of the Limitation Act. Principles underlying Section 14 may nevertheless permit exclusion of time spent pursuing a rectification petition where it concerns the same parties and matter and was pursued with due diligence and good faith. Good faith requires an arguable rectification basis, not a meritless attempt to introduce material absent from the original proceedings. Where exclusion is established, the appeal period is computed after excluding the rectification period; otherwise, reconsideration may be subject to agreed remittance conditions.
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AI-generated legal material requires independent verification and human oversight; GST cancellation proceedings require fresh reasoned adjudication.
Case-Laws
GST
Use of AI-generated legal material in quasi-judicial orders requires independent verification, human oversight, and the issuing officer's own application of mind. Reliance on non-existent or irrelevant AI-generated precedents prompted an unconditional apology, and non-compliance with departmental safeguards was directed to be treated as contempt of court. GST registration cancellation proceedings were quashed because the authorities proposed to revise the challenged orders and issue a fresh notice. Fresh adjudication must consider the taxpayer's reply and defence and result in a reasoned order in accordance with law; the merits remain open.
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Transitional credit refunds require Electronic Credit Ledger proof, while belated writs cannot bypass expired statutory appeal limitation.
Case-Laws
GST
Transitional SGST input tax credit refund requires proof that the unutilised erstwhile-regime credit stood as an opening balance in the Electronic Credit Ledger on 1 July 2017. In the absence of the prescribed TRAN-1 declaration or other satisfactory evidence of that balance, the refund claim fails. Writ jurisdiction under Article 226 ordinarily cannot be used to revive a statutory challenge after the taxpayer's own default has allowed the appeal limitation to expire, particularly where the delay is inordinate. The writ petition was dismissed because the transitional credit was unsubstantiated and the statutory appellate remedy had become time-barred.
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Passport renewal during criminal proceedings can run full term where prior court approval effectively safeguards foreign travel.
Case-Laws
GST
Passport renewal may be granted for its regular ten-year term during pending criminal proceedings where prior court permission remains mandatory for foreign travel. Travel restrictions, reinforced by directions to investigating and immigration authorities, provide sufficient safeguards against unauthorised departure regardless of the passport's validity period. In the absence of plausible reasons, substantive harm, or reasonable apprehension, limiting renewal to three years was not justified, particularly given the accused's stated roots in India. Renewal for ten years operates subject to all continuing conditions requiring prior court approval before travel abroad.
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