Author: admin_gst

GST on liquidated damages for service-agreement breach held as compensation, not supply consideration; tax notice quashed, refund ordered
Case-Laws
GST
GST was sought to be levied on liquidated damages received for breach/non-performance under a service agreement. The Court held that such amounts represent compensation for loss/damage payable under ss. 73-74 of the Contract Act and are expressly covered by para 7 (including paras 7.1 and 7.1.6) of Circular No. 178/10/2022, which clarifi

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Two arrested for over Rs 17 crore GST evasion in UP's Bhadohi
GST
Dated:- 31-12-2025
PTI
Bhadohi (UP), Dec 31 (PTI) Police on Wednesday arrested two persons and busted a racked allegedly involved in evading about Rs 17.57 crore in GST in Uttar Pradesh's Bhadohi by floating fake firms and showing bogus transactions worth more than Rs 96 crore across several states, officials said.
Additional Superintendent of Police Shubham Agrawal said a case was registered on July 7 at the Aurai police station on a complaint by Assistant Commissioner, Commercial Tax, Bhadohi, Manoj Kumar Agrawal, against Jogendra Kumar, proprietor of Jogendra Enterprises.
According to the complaint, the firm allegedly carried out fictitious transactions wor

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BEE's new star ratings to push AC prices up 10 pc, refrigerators by 5 pc from Jan
GST
Dated:- 31-12-2025
PTI
New Delhi, Dec 31 (PTI) Prices of cooling appliances such as room air conditioners and refrigerators may go up 5-10 per cent from January 1, 2026, as the new revised star rating from the Bureau of Energy Efficiency (BEE) comes into force.
This hike, which will be applicable from January 1, 2026, will almost offset the price advantage which the consumers have got from the GST reforms in September this year on room air-conditioners (RAC), where duty was slashed 10 per cent.
Besides the fall of the Indian rupee against the US dollar and global increase of copper prices is also putting pressure on manufacturers' margins.

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of 5 per cent.
Expressing a similar opinion, Godrej Enterprises Group Business Head & EVP at Appliances Business Kamal Nandi said the durables industry is getting affected by currency depreciation as well as adverse commodity costs and scheduled energy regime changeover from January, which cumulatively will lead to a significant cost increase in cooling categories, with RACs being most impacted.
“In the immediate context, energy regime changeover-linked price hike to the tune of 5-7 per cent for ACs and 3-5 per cent for refrigerators looks likely,” said Nandi.
Voltas Senior Business Leader Jayant Balan said India's cooling industry is entering a transformative phase with the upcoming BEE star rating revision effective January 2026.

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movements,” he said.
The AC industry got GST benefits and had also seen an increase in sales. However, the industry is also committed towards sustainability as when the demand goes up, it is also required to balance the energy efficiency.
“Prices will definitely go up, not only because the BEE labelling standards are going up, but copper also has gone up, the raw material cost has been going up, the dollar against the rupee has depreciated,” he said.
Asked whether the RAC prices will return to pre-GST reforms time, Jawa said, “It will be around that”.
Besides, BEE has also made star-labelling mandatory on a host of appliances, including televisions, LPG gas stoves, cooling towers, and chillers from January 1. This will help custome

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Tax demand adjudication exceeding show-cause notice and using undisclosed adverse material set aside; fresh hearing ordered with disclosures.
Case-Laws
GST
The dominant issue was whether the impugned adjudication suffered from jurisdictional error and breach of natural justice by travelling beyond the show cause notice and relying on adverse material without confrontation. The Court held that an adjudication cannot confirm a demand far in excess of the proposed demand and must provide t

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Statutory appeal filed after maximum condonable delay: writ petition cannot compel admission or extend limitation; dismissal upheld
Case-Laws
GST
A writ petitioner sought to set aside rejection of a statutory appeal as time-barred and to compel acceptance beyond the maximum condonable period. Relying on binding precedent, the Court held that when the statute caps condonation, the appellate authority lacks power to admit an appeal filed after the aggregate period, and the HC's Article 22

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Air purifiers and HEPA filters classification for 5% GST as medical devices; issue sent to GST Council, case pending.
Case-Laws
GST
Whether air purifiers and HEPA filters should be treated akin to “medical devices” covered by the notification prescribing 5% GST was the dominant issue. The court, noting the functional role of these devices and policy concerns reflected in parliamentary recommendations, recorded a prima facie view that there was no apparent reason to deny them the 5% rate

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Overseas service supply: whether s.2(13) “intermediary” or s.2(6) export; GST demand partly quashed, reply allowed.
Case-Laws
GST
Services rendered to an overseas recipient were examined to determine whether they constituted “intermediary services” under s.2(13) IGST Act, or exports under s.2(6) IGST Act. Applying its earlier ruling on identical facts, the Court held the service provider acted as an independent service provider and not as an intermediary, and the supply qualified as exp

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Taxpayer's 2020-21 GST arrears payment request rejected without hearing; decision set aside, DRC-13 garnishee recovery paused pending deposit.
Case-Laws
GST
The dominant issue was whether rejection of the taxpayer's request relating to payment of GST arrears for 2020-2021, purportedly under Rule 158B(3) and Rule 158(3)(a) of the GST Rules, could stand without affording an effective personal hearing. The authority was directed to reconsider the matter on merits after granting a personal

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Charity-run tree plantation and maintenance for environmental preservation qualifies as “charitable activity”, making supplies GST-exempt under Notification 12/2017.
Case-Laws
GST
Plantation and maintenance of trees undertaken by a registered charitable institution for preservation of environment was examined for exemption under Entry 1 of N/N. 12/2017-CT(R) read with the definition of “charitable activities” in clause 2(r). Since preservation of environment, including forests and ecolo

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GST portal show-cause notice served via “Additional Notices” tab; adjudication order set aside for ignoring taxpayer reply
Case-Laws
GST
Challenge to service of the show cause notice (SCN) on the ground that it was uploaded only in the “Additional Notices” tab was rejected, as the portal changes after 16 January 2024 made that tab visible and accessible, and the SCN issued on 17 May 2024 was shown to be available there. However, the adjudication order was held vitiated for breach of nat

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IndiGo faces Rs 458 crore GST penalty; airline to contest ruling
GST
Dated:- 30-12-2025
PTI
New Delhi, Dec 30 (PTI) The country's largest airline IndiGo on Tuesday said authorities have slapped a GST penalty of over Rs 458 crore, and that it would contest the decision.
The Additional Commissioner of CGST- Delhi South Commissionerate has slapped the penalty. It pertains to the assessment order under Section 74 of the Central Goods and Services Tax Act, 2017, for FY-2018-19 to FY 2022-23, according to a regulatory filing.
The total GST penalty is Rs 458,26,16,980.
“GST department has passed an order imposing GST demand along with interest and penalty on compensation received from foreign supplier and denial of Input Tax cred

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GST goods detention and penalty u/s129 challenged; adjudication order issued after 7-day limit, so detention orders quashed.
Case-Laws
GST
Detention and penalty proceedings under s.129 of the CGST/GGST Act were challenged on the ground that the adjudication order under s.129(3) was issued beyond the statutory seven-day limit from service of notice. Since the notice in Form GST MOV-07 was served on 10.11.2025 and the order in Form GST MOV-09 was passed on 19.11.2025, the authority acted

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Goods detention and confiscation without s.129(3) notice, direct s.130 action using MOV-10/MOV-11; writ declined, appeal directed.
Case-Laws
GST
Challenge to detention/confiscation proceedings under the CGST Act on the ground that no notice under s.129(3) was issued and the authority, without determining penalty under s.129, directly initiated confiscation under s.130 in Forms GST MOV-10 and MOV-11, was not adjudicated on merits in writ jurisdiction. The court directed the aggrieved par

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Time-barred s.107 GST disputed tax appeal and belated writ challenge remitted for fresh decision with 25% cash deposit
Case-Laws
GST
Where the statutory appeal under s. 107 of the GST enactments, 2017 had become time-barred and the assessee invoked writ jurisdiction belatedly, the Court held that, consistent with prior similar orders, the interests of revenue and the assessee could be balanced by setting aside the impugned order and directing a de novo decision on merits subject to a pr

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GST liability based on income-tax portal turnover vs bank receipts mismatch; s.74 assessment orders remitted for forensic review.
Case-Laws
GST
GST assessment orders issued under s.74 were challenged on the ground that tax liability was fastened solely on turnover reflected in the income-tax portal, allegedly based on an inflated return, despite a marked mismatch between bank receipts and reported turnover. The Court held that, given the significant discrepancies, the taxpayer's records

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Place of supply for shipped goods u/s 10(1)(a): delivery location decides IGST, CGST/SGST demand quashed.
Case-Laws
GST
Section 10(1)(a) of the IGST Act fixes the place of supply where the movement of goods terminates for delivery to the recipient, not when goods are handed to a common carrier or when title passes under contractual terms. As the goods were destined to recipients at locations outside the State, the supply was inter-State, attracting IGST, and not intra-State so as to per

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Patent application filing documentation from foreign attorneys treated as imported legal services; GST payable in India under reverse charge
Case-Laws
GST
Legal documentation and certification services for filing patent applications received from foreign patent attorneys constituted “legal services” classifiable under SAC 998213, attracting GST as import of services with place of supply at the recipient's location in India. Exemption for “legal services” under the relevant entry was hel

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Charitable tree plantation and maintenance for environmental preservation treated as “charitable activity”, exempt from GST under Notification 12/2017 Entry 1
Case-Laws
GST
Plantation and maintenance of trees undertaken by an applicant charitable institution, registered under the Income-tax Act for preservation of environment, was examined for GST liability and the applicability of Entry 1 of Notification No. 12/2017-CT(R). “Charitable activities” under clause 2(r) expressly includes pr

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Input tax credit on cement, steel and works contract for warehouse construction blocked u/s17(5); ITC denied. (5)
Case-Laws
GST
Input tax credit on cement, steel and other inputs and works contract/construction services used to construct a warehouse was held to be blocked under s.17(5)(c) and s.17(5)(d) where such construction results in an immovable property. While “plant or machinery” in s.17(5)(d) is not governed by the definition of “plant and machinery” in the Explanation to s.17 a

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Advisory & FAQ on Electronic Credit Reversal and Re-claimed Statement & RCM Liability/ITC Statement
GST
Dated:- 30-12-2025

1.  To ensure correct and accurate reporting of reversed and reclaimed ITC and to avoid clerical mistakes, Electronic Credit Reversal and Re-claimed Statement (Reclaim Ledger) was introduced on the GST portal from August 2023 return period onwards for monthly taxpayers and from July-September 2023 quarter for quarterly taxpayers. This Reclaim Ledger captures the ITC temporarily reversed in Table 4(B)2 and its subsequent reclaim in Table 4(A)5) and 4(D)1.
2.  As of now taxpayer get a warning message if a taxpayer attempts to re-claim excess ITC in table 4D(1) than the available ITC reversal balance but the taxpayer is allowed to file its Form GSTR-3B.
3.  To the taxpayers multiple opportunities have been given to report their opening balance which was earlier reversed ITC but was not reclaimed till that ti

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pening balance and amend the opening balance for both the said statements where any transaction related to excess ITC reversal or excess RCM liability/ITC prior to implementation of the said statements could be declared as opening balance to these statements.
8.  This RCM Liability/ITC Statement can be accessed through: Services >> Ledger >> RCM Liability/ITC Statement.
9.  Now, the taxpayers are hereby informed that, shortly, negative values or availment of excess ITC over and above available balance, shall not be allowed in both the ledgers. Both the statements shall have a below mentioned validation for regulation of ITC:
a.  The reclaimed ITC in Table 4(D)(1) shall be lesser than or equal to the combined values of closing balance of Electronic Credit Reversal and Re-claimed Statement and ITC being reversed in Table 4(B)(2) of current period GSTR-3B. and,
b.  The RCM ITC claimed in Table 4(A)2 & 4(A)3 shall be equal to or less than the combin

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g balance in the current return period.
11.  For more information on Electronic Credit Reversal and Re-claimed Statement please refer the advisory dated 17th September, 2024 issued by GSTN by clicking below link https://tutorial.gst.gov.in/downloads/news/itc_pending_ledger.pdf. Also, detailed advisory on Introduction of RCM Liability/ITC Statement can be seen by clicking on below link:https://services.gst.gov.in/services/advisoryandreleases/read/514 .
FAQs related to Electronic Credit Reversal and Re-claimed Statement and RCM Liability/ITC Statement
1. How to view my Electronic Credit Reversal and Re-claimed Statement?
You can view the statement by navigating to the Dashboard › Services › Ledger › Electronic Credit Reversal and Re-claimed.
2. How to view my RCM Liability/ITC Statement?
You can view the RCM Liability/ITC Statement by navigating to the Dashboard › Servic

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In case there is no ITC available, this reversal declared in table 4(B)2 will be added to your liability in current period while filing GSTR-3B.
Example: The closing balance of the ITC reclaim ledger for the current return period is -Rs.10,000, which means Rs.10,000 of excess ITC has been reclaimed in earlier periods. To file your GSTR-3B, you would need to reverse this earlier excess reclaimed ITC of Rs.10,000 in Table 4B(2) for the current period.
5. How will the validation mechanism work in GSTR-3B for RCM Liability/ITC Statement?.
The taxpayers will not be able to file GSTR-3B in case the claimed RCM ITC in Table 4A(2) or 4A(3) exceeds the available balance in the RCM Liability/ITC Statement and the RCM liability reported in Table 3.1(d) for the current return period put together.
6. How to file GSTR-3B if closing balance of RCM Liability/ITC Statement is Negative?
If the closing balance of the RCM Liability/ITC Statement is negative, it indicates that excess RCM IT

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IIP growth at 2-year high at 6.7 pc in Nov on robust manufacturing driven by GST rate cuts
GST
Dated:- 29-12-2025
PTI
New Delhi, Dec 29 (PTI) India's industrial production grew at a two-year high of 6.7 per cent in November this year, driven by strong performances in mining and manufacturing, mainly on account of order pile-up following a cut in GST rates, according to official data released on Monday.
The factory output, measured in terms of the Index of Industrial Production (IIP), had expanded by 5 per cent in November 2024.
The previous high was recorded at 11.9 per cent in November 2023.
Ahead of the festivals, the Goods and Services Tax (GST) rates were cut on a host of consumer items, effective from September 22, 20

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ce (NSO) revised the industrial production growth to 0.5 per cent for October 2025 from the provisional estimate of 0.4 per cent released last month.
The NSO data showed that the manufacturing sector's output grew by 8 per cent in November 2025 from 5.5 per cent in the year-ago month. Mining production rose by 5.4 per cent against a growth of 1.9 per cent recorded a year ago.
Power production contracted by 1.5 per cent in November 2025, compared to 4.4 per cent expansion in the year-ago period.
During the April-November period of FY26, the country's industrial production growth decelerated by 3.3 per cent compared to 4.1 per cent in the same period a year ago.
An NSO statement said, “Driven by 8 per cent growth in manufacturing sect

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Show-cause notice deadlines extended by disputed notifications, and no hearing opportunity-adjudication order set aside for fresh decision
Case-Laws
GST
The dominant issue was whether the adjudication order passed pursuant to a show cause notice, where the notice-period was impacted by challenged extension notifications, should stand despite the petitioner not having filed any reply or attended hearing. The Court held that, since the validity of the extension notifications is pending co

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Customs Clearance Facilitation Committee meet reinforces stakeholder confidence
GST
Dated:- 29-12-2025

Meeting brought together partner Government agencies, including, FSSAI, Plant Quarantine, Drug Controller; trade associations such as the Customs Broker Fraternity, ASSOCHAM, GJEPC; and stakeholders such as custodians, importers, exporters, and departmental officers
The Customs Clearance Facilitation Committee (CCFC) meeting was convened by Delhi Customs at the Kalpana Chawla Conference Hall, IGI Airport, under the chairmanship of the Chief Commissioner of Customs, Delhi Zone.
The meeting brought together partner Government agencies including FSSAI, Plant Quarantine, and the Drug Controller, alongside trade associa

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Customs processes and enhancing coordination across the EXIM community.
The Delhi Customs Zone reaffirmed its commitment to promoting ease of doing business and advancing trade facilitation within the framework of law. It emphasised that the guiding motto of the Zone rests on the principles of Transparency, Accessibility, and Efficiency. These values are not only central to the functioning of Customs but also serve as a foundation for building trust and ensuring that stakeholders feel empowered to engage openly with the administration.
Looking ahead, the Delhi Customs Zone underscored that ease of doing business is a continuous journey requiring sustained collaboration between Customs, partner agencies, custodians, and the trading co

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GST portal show-cause notice hidden in “Additional Notices” tab leads to missed hearing; demand order set aside, remanded.
Case-Laws
GST
Where a show cause notice was uploaded on the GST portal's “Additional Notices Tab” before the tab was made visible and the taxpayer did not become aware of it, such portal-only uploading was held to have denied a meaningful opportunity of hearing, vitiating the adjudication; consequently, the demand order was set aside and the matter remanded for fres

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GST registration cancellation u/s 29(2)(e): order quashed for no reasons and “hearer must decide”; remanded for fresh hearing
Case-Laws
GST
Cancellation of GST registration under Section 29(2)(e) of the CGST/WBGST Act was set aside as the order lacked reasons, reflected non-application of mind, and violated natural justice. The notice of personal hearing was issued by one authority, but the impugned cancellation order was passed by another, breaching the settled rule that the authority

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