Author: admin_gst

GST Implications: High Seas Sale Goods Value Must Be Included in Works Contract Under Section 15 CGST
Case-Laws
GST
The AAR ruled on GST implications in an EPC contract between the applicant and IOCL. The contract was determined to be a single, composite works contract rather than a divisible one, despite comprising two work orders. The high seas sale (HSS) transaction was deemed neither a supply of goods nor services under Schedule III of CGST Act. However, the value of imported goods sold on HSS basis must be included in the transaction value for GST computation on works contract services, as per Section 15 of CGST Act. The ruling established that subsequent incorporation of HSS goods into works contract constitutes a composite supply treated as service under Schedule II. The contract's taxation involves both customs duty at importation and GST on the composite works contract service.
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Oil Company's $80M Payment for Production Sharing Contract Breach Ruled as Damages, Not Service Consideration
Case-Laws
GST
ANP demanded settlement fees from appellant following breach of Production Sharing Contract (PSC). The AAAR determined that USD 80,000,000 payment constituted liquidated damages for PSC breach, not consideration for services. The payment was made to compensate losses under clause 4.5(a)(iii), with no evidence of agreement for ANP to perform, refrain from, or tolerate specific acts in exchange. Following established principles on liquidated damages, such payments represent mere flow of money without constituting consideration for supply. The AAAR overturned previous ruling which incorrectly characterized payment as service-related. Appellant not liable for GST on settlement fees as payment qualified as damages rather than consideration for supply under GST framework.
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Tax Authority Cannot Apply 40% Turnover Rule Without Statutory Basis When Actual Transaction Data Already Submitted
Case-Laws
GST
HC set aside both assessment and rectification orders, finding no statutory basis for computing tax on 40% of total turnover as taxable transactions within Bihar state. The petitioner had already shown specific gross turnover in annual returns. Court directed petitioner to appear before Assessing Officer with supporting documentation on December 20, 2024. Assessing Officer must provide hearing opportunity and complete reassessment either on same date or subsequent date with proper acknowledgment from assessee or authorized representative. Matter requires fresh assessment based on actual turnover data rather than arbitrary percentage calculations.
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Input Tax Credit Claims on Mall Construction Under Section 17(5)(d) Must Consider Business Purpose of Structure
Case-Laws
GST
HC set aside tax liability determination under section 73 of CGST Act, 2017 and remanded for fresh consideration. The case involved ITC claims related to construction of shopping malls. Following Safari Retreats precedent, court held that 'plant or machinery' interpretation under section 17(5)(d) requires factual determination based on business context. Original order failed to consider Safari Retreats principles regarding classification of malls as plant. Issues regarding 8 invoices and ITC reporting discrepancies between GSTR-3B and GSTR-9 forms remain open for fresh examination. Matter remanded for de novo consideration incorporating Supreme Court's interpretative guidance.
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Late Fee Under Section 47(2) Applies Until Complete Filing of Both GSTR-9 and GSTR-9C Annual Returns
Circulars
GST
Late fee under CGST Act section 47(2) applies for delayed filing of complete annual return comprising both GSTR-9 and GSTR-9C (where required). For taxpayers with turnover exceeding specified thresholds, annual return is deemed incomplete without GSTR-9C. Late fee calculation period extends from due date until complete submission. Per notification 08/2025-CT, excess late fee beyond GSTR-9 filing date is waived for FY 2022-23 and earlier if GSTR-9C is filed by March 31, 2025. No refund available for previously paid late fees. Single late fee applies for the entire delay period rather than separate penalties for GSTR-9 and GSTR-9C.
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Eco survey calls for Ease of Doing Business 2.0 but silent on GST 2.0, ending 'tax terrorism': Cong
GST
Dated:- 31-1-2025
PTI
New Delhi, Jan 31 (PTI) The Congress slammed the BJP-led Centre on Friday after the latest Economic Survey was tabled in Parliament, saying it calls for Ease of Doing Business 2.0 but is silent on a whole new GST 2.0 and an end to the “tax terrorism” unleashed over the last 10 years.
Congress general secretary in-charge communications Jairam Ramesh said the Economic Survey has little to say about an Ease of Living 1.0 to ensure that the public-health crisis caused by growing pollution and chemical contamination begins to be dealt with seriously.
“The Economic Survey of the Ministry of Finance is often a

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foisting an Aadhaar-based payment system on them, and keeping wages low,” Ramesh said.
The survey also points out that there are 11.5 crore unique investors with demat accounts in Indian financial markets and says that “higher investor participation has engendered a self-reinforcing cycle of strong market returns, bringing in even more investors”, he noted.
“Why then is the government overseeing the corruption and weakening of a valuable national asset like SEBI, whose integrity is central to the welfare of these investors? As the Economic Survey itself says 'It is reasonable to expect that financial regulators hold themselves to the same standards that they expect of regulated entities',” the Congress leader said.
Despite thousands of

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Dismissal Order Reversed: Appeal to Proceed After Pre-deposit Payment Within Two Weeks Despite Initial Technical Rejection
Case-Laws
GST
HC set aside the dismissal order regarding petitioner's appeal, which was initially rejected due to non-payment of mandatory pre-deposit. The court found procedural irregularities in the Appellate Authority's issuance of a common order for multiple appellants without establishing identity of cause of action or parties. While some appeals were partially allowed, the petitioner's case was dismissed solely on technical grounds of non-payment. Given petitioner's willingness to comply with payment requirements, HC granted relief conditional upon full pre-deposit payment within two weeks, enabling adjudication on merits.
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Tax Liability Notice on Royalty Under Section 73(5) Not Final Order, Premature Challenge Dismissed
Case-Laws
GST
HC dismissed the premature writ petition challenging tax liability on royalty under KGST/CGST Act. The disputed Annexure-D was merely an intimation of ascertained tax under s.73(5), providing opportunity to either pay with interest or file submissions. No formal show cause notice under s.73(1) or final order under s.73(9) had been issued yet. The court held that petitioner retained remedy to file submissions against the intimation, and formal adjudication process including show cause notice would follow only upon non-payment. Given the preliminary stage of proceedings, petition was rejected as premature.
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GST Registration Suspension Notice Quashed Due to Parallel DGGI Investigation Under Rule 21(c)
Case-Laws
GST
HC quashed the Show Cause Notice (SCN) dated 25 April 2024 issued by State GST authorities regarding suspension of petitioner's GST registration. The court noted ongoing parallel investigation by Directorate General of GST Intelligence (DGGI) through a separate SCN dated 01 July 2024, which remained pending. Given the concurrent jurisdiction and pending DGGI proceedings, as acknowledged in State GST authorities' counter affidavit, the court found the subsequent State GST SCN untenable under Rule 21(c) of CGST Rules, 2017. The petition was allowed, invalidating the State GST's SCN to prevent duplicative proceedings.
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GST Appeal: Interim Stay Granted on Tax Demand with 10% Payment Required Beyond Section 107(6) Deposits Within Two Weeks
Case-Laws
GST
HC granted interim stay on appellate order demanding GST dues for two weeks, conditional upon petitioner paying 10% of disputed tax balance beyond Section 107(6) deposits. Stay extension contingent on payment within two weeks, to continue until writ petition disposal or further orders. Prima facie case established by petitioners warranted temporary relief. Court directed respondents to file opposition affidavit within six weeks, with one week allowed for reply. Stay operates as temporary measure balancing revenue interests with taxpayer rights pending full adjudication of underlying dispute by Appellate Tribunal.
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Gold Jewelry Transport Case: Tax Evasion Through Rules 138 and 55 Leads to Confiscation Under Section 130
Case-Laws
GST
HC upheld confiscation notice issued under Section 130 of TNGST Act regarding transport of gold jewelry. Officials established prima facie evidence of tax evasion through misuse of Rules 138 and 55 of CGST Rules. Court distinguished between Section 129 (seizure) and Section 130 (confiscation), ruling they operate independently despite non-obstante clause in Section 129. Following Synergy Fertichem precedent, authorities demonstrated sufficient grounds beyond mere suspicion for confiscation proceedings. Petitioner failed to provide adequate documentation to counter allegations of intentional tax evasion. Authorities' formation of opinion met threshold requirements for invoking Section 130. Petition dismissed, upholding validity of confiscation notice.
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Taxpayer Wins Rs.33.69 Lakh GST Refund Case Under Section 128A After Department Confirms PLA Account Credit Adjustment
Case-Laws
GST
HC determined petitioner entitled to refund of Rs.33,69,271 paid under CGST Act following Section 128A implementation. Department confirmed adjustment of amount through PLA account credit against returns filed on 31.10.2017. Court granted liberty to petitioner to file refund application for deposited amount. Department acknowledged compliance with previous court queries from 17.12.2024 order, particularly paragraphs 5 and 6. Writ petition concluded with directive for processing refund as per statutory provisions under CGST framework.
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Penalties Under Section 74 CGST Act Upheld For Wilful Suppression Through Non-Filing Returns Despite Receiving Client Payments
Case-Laws
GST
HC affirmed penalties under Section 74 of CGST Act against petitioner for wilful suppression of facts through non-filing of monthly returns and non-payment of GST. Despite petitioner's claim that non-payment resulted from client's default, evidence showed partial payments were received from the client. Court held that Section 74 penalties require proof of intentional evasion through fraud, wilful misstatement, or deliberate suppression – mere non-payment is insufficient. Here, petitioner's conduct demonstrated wilful suppression as defined in Explanation-2, warranting penalties. Court rejected argument that Section 74 notice was invalid because tax was paid before notice issuance, noting interest under Section 50 remained unpaid. Additional consequential penalties were upheld.
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High Court Grants Bail to GST Official in Bribery Case After 55 Days Custody Under Section 483 BNSS
Case-Laws
GST
HC granted regular bail to petitioner accused of demanding bribes for GST registration. Despite prima facie evidence linking petitioner to the alleged crime under Section 483 of Bharatiya Nagarik Suraksha Sanhita, 2023, the court determined that extended pre-trial detention was unwarranted. Key factors in the decision included: pre-trial custody duration of 1 month 25 days, principle that pre-trial detention should not mirror post-conviction sentencing, nature of allegations, and case-specific circumstances. The court emphasized this ruling was based on case-specific facts without commenting on substantive merits. Bail order effective upon upload to court's official webpage.
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GST Tax Demand Order Quashed: High Court Rules Service Notice Irregularities Violated Natural Justice, Grants 2-Week Reply Period
Case-Laws
GST
HC quashed tax demand order under GST Act due to procedural irregularities in notice service. Petitioner claimed no awareness of notices or orders, preventing timely response within limitation period. Court found merit in petitioner's contention that order was not visible under system's “view notices and orders” tab, constituting violation of natural justice principles. Given that disputed amount was already deposited with State Government, HC directed treating impugned order as final notice, granting petitioner two weeks to submit written reply instead of relegating to statutory remedy. Matter resolved considering procedural fairness and existing tax deposit.
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High Court Allows Revision of GSTR-3B Returns for ITC Claims Under Section 140 CGST Act Due to Technical System Limitations
Case-Laws
GST
HC ruled in favor of petitioner seeking permission to revise GSTR-3B returns for July-November 2017. The case centered on transitional ITC claims under Section 140 of CGST Act 2017. Court acknowledged system limitations, noting TRAN-01 facility was available only from August 25, 2017, despite GST implementation from July 1, 2017. The delay in ITC availability forced petitioner to discharge liability through cash payments. HC emphasized technical glitches shouldn't penalize compliant taxpayers, particularly those under inverted duty structure. The ruling permits revision of returns, allowing proper ITC utilization despite initial system constraints.
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High Court Upholds Right to Cross-Examine Witnesses in GST Proceedings Under Section 75(4), Citing Natural Justice Principles
Case-Laws
GST
HC quashed the authority's refusal to allow cross-examination of witnesses whose statements were used in show cause notice under CGST Act. The court emphasized that when third-party statements are relied upon in quasi-judicial proceedings, the fundamental right to cross-examine flows from Section 75(4) of CGST Act and principles of natural justice. The court held that unilateral statements made without providing opportunity for cross-examination cannot be justified under rule of law. The impugned order (Ext.P3) was set aside with directions to permit petitioner to cross-examine the persons whose statements were referenced in show cause notice while continuing the proceedings.
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Maharashtra GST Authority Cannot Proceed with Show Cause Notice After Karnataka HC Stay on Same Transaction Under Section 74
Case-Laws
GST
HC determined the maintainability of petition challenging show cause notice under Section 74 of CGST Act regarding taxation of reward amounts received from Hong Kong group company. Court rejected preliminary objection, noting dual taxation attempt by Maharashtra and Karnataka authorities on same Rs. 6092 Crores transaction. Karnataka HC had already stayed notice for full amount, while Maharashtra sought to tax a portion. Given significant legal questions and Rs. 75 crores already deposited with Maharashtra authorities, court restrained respondents from further action on show cause notice dated July 21, 2024. Key consideration was prevention of double taxation on identical transaction across jurisdictions.
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High Court Invalidates GST Assessment Order Due to Missing Document ID Number (DIN)
Case-Laws
GST
HC set aside GST assessment proceedings due to absence of Document Identification Number (DIN). Following SC precedent in Pradeep Goyal case and CBIC circular No. 128/47/2019-GST, the court determined that orders without DIN are non-est and invalid. The ruling aligns with previous HC Division Bench decisions in Cluster Enterprises and Sai Manikanta cases which established that non-mention of DIN invalidates proceedings. Court granted liberty to revenue authorities to conduct fresh assessment after proper notice to assessee and assignment of DIN number. The Form GST DRC-07 dated 26.06.2024 was consequently invalidated, emphasizing procedural compliance requirement in GST administration.
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Charitable Trust's Marriage Hall Must Pay GST and Penalties After Deliberately Masking Fees as Donations Under Section 74
Case-Laws
GST
HC dismissed petition of charitable trust operating marriage hall challenging GST liability. Trust failed to register under GST Act from July 2017 to January 2020, attempting to evade tax by issuing receipts as donations. Post-inspection registration and tax payment were not voluntary but to avoid penalties. Court upheld that trust's conduct constituted suppression and fraud under Section 74 of GST Act. Both Original Authority and Appellate Authority correctly applied law, finding deliberate tax evasion through non-registration and mischaracterization of payments. Trust liable for unpaid taxes and penalties, with no grounds for judicial interference.
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DGGI uncovers Rs 3,200 cr GST fraud, two held
GST
Dated:- 29-1-2025
PTI
Bengaluru, Jan 29 (PTI) The Directorate General of GST Intelligence (DGGI) in Bengaluru has uncovered a massive GST fraud amounting to Rs 3,200 crore and arrested two people in connection with the case.
A third suspect remains at large, Sucheta Sreejesh, Additional Director General of DGGI Bengaluru zone, said in a statement.
The DGGIÂ’s Bengaluru zonal unit conducted searches at more than 30 locations across Bengaluru and Mumbai, uncovering a complex scam.
The accused created bogus companies with no legitimate business operations, engaged in circular trading to inflate turnover, listed these companies on stock exchanges, and facilitated the fraudulent a

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the share price, sell the shares subsequently and exit the company, duping common public of their money invested in shares of such companies,” the statement said.
The probe also revealed that GST returns for most of these companies were filed from common IP addresses, suggesting that they were all operated by the same accused.
Further searches at the companies' premises uncovered original documents such as invoices and financial records, stored across several locations, indicating that the same individuals were managing the affairs of multiple companies.
“Considering the magnitude of the fraud and its impact on the common public, the Directorate General of GST Intelligence, Bengaluru Zonal Unit has initiated thorough investigation in

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GST Council Exempts Loan Penalty Charges, Payment Aggregator Settlements Under 2000, and Training by NSDC Partners
Circulars
GST
CBIC clarified multiple GST applicability issues based on 55th GST Council recommendations. Key determinations: No GST payable on penal charges levied by regulated entities for loan contract breaches. GST exemption extended to RBI-regulated Payment Aggregators for settlements up to 2000 per transaction. Research and development services by Government Entities against grants regularized for period July 2017-October 2024. DDA not classified as local authority under GST law. GST applicable on facility management services to MCD headquarters. Training services by NSDC-approved partners exempted from January 2025, with past period regularized. Goethe Institute services' GST payments regularized for July 2017-March 2023 period.
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Insurance Premium Sharing Between Lead Insurers and Co-insurers Not GST Taxable Under Schedule III CGST Act
Circulars
GST
GST Council's 53rd meeting recommendations led to amendments in Schedule III of CGST Act, clarifying two key insurance transactions. First, co-insurance premium apportionment by lead insurers to co-insurers is neither goods nor services supply, provided lead insurer pays all applicable taxes on full premium. Second, ceding/reinsurance commission deducted from reinsurance premium similarly excluded, conditional on reinsurer paying taxes on gross premium including commission. These changes, effective from 01.11.2024, also include retrospective regularization from 01.07.2017 to 31.10.2024 on 'as is where is' basis, resolving historical tax treatment ambiguities in insurance sector transactions.
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High Court Allows Fresh Hearing in GST Dispute After 25% Tax Deposit, Sets Aside Time Limitation Order.
Case-Laws
GST
HC set aside the impugned order regarding time limitation and GSTR-3B/GSTR-2A mismatch dispute. The petitioner's willingness to deposit 25% of disputed tax amount was considered favorably. Court granted relief by directing petitioner to deposit the agreed percentage within four weeks from order receipt, allowing a final opportunity to present objections before the adjudicating authority. The decision balances tax compliance requirements with procedural fairness, enabling the petitioner to pursue substantive arguments while ensuring partial tax recovery. Matter remanded for fresh consideration upon compliance with deposit condition.
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West Bengal High Court Upholds GST Penalty u/s 129 for Transportation Document Discrepancies and Invalid Input Tax Claims.
Case-Laws
GST
HC upheld penalty u/s 129 of WBGST Act 2017 regarding discrepancies in vehicle transportation documentation. The petitioner failed to establish legitimate purchase chain from Mr. X to Company Y, with Input Tax Credit already claimed by Company Z. Documentation inconsistencies included contradictory e-way bill and invoice details, with no tax payment evidence. The margin value scheme was deemed inapplicable. The Court found proper procedural compliance by authorities in issuing notice and providing opportunity for hearing. Despite petitioner's reliance on precedents, the Court distinguished them from present circumstances. The petition challenging penalty order dated May 30, 2023, was dismissed, affirming appropriate invocation of Section 129 provisions.
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