Author: admin_gst

Time-Barred GST Demand Quashed: Three-Year Limitation Under Section 73(10) Expired Before Order Issuance
Case-Laws
GST
HC quashed an ex-parte demand order and show cause notice issued on 14.12.2023 for the financial year 2017-18 as time-barred under Section 73(10). Following the precedent in M/s Anita Traders, the court determined that due to notification extensions, the three-year limitation period for orders under Section 73(9) expired on 05.02.2023. The court rejected arguments that the deadline extended to 31.03.2023, finding the impugned orders issued well beyond the prescribed limitation period and therefore void for lack of jurisdiction. The petition was allowed, with the challenged orders declared ultra vires for exceeding statutory time limitations.
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Taxpayer Wins Remand After Assessment Order Made Without Adequate Hearing Opportunity
Case-Laws
GST
The HC set aside both the assessment order and rectification order, remanding the matter to the assessing authority for fresh consideration. The Court found that the respondent violated principles of natural justice by issuing the impugned assessment order without providing sufficient opportunities to the petitioner. Despite the petitioner's requests for adjournment to file detailed replies with supporting documents and for personal hearing following show cause notices, the respondent proceeded with the assessment. The Court held that when confirming a demand, authorities must provide adequate opportunity of hearing, which was denied in this case, necessitating remand for consideration on merits.
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Anticipatory Bail Granted in GST Case Where Timely Returns Filed and No Loss to State Exchequer
Case-Laws
GST
In an anticipatory bail application involving allegations of financial misconduct, the HC granted relief to the petitioner. The Court determined that no loss was caused to the State Exchequer as the petitioner had filed GST returns punctually, with purchases by him and his firm accurately reflected in the vendor's GST R-1 Return, GST 2-A, and 3-B returns. All taxes were paid promptly. The Court considered the petitioner's willingness to join the investigation and cooperate with investigating officers as averred in paragraph 16 of the petition. Consequently, the anticipatory bail application was allowed subject to fulfillment of imposed conditions.
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Virtual Hearings Mandatory for All RGST/CGST Act 2017 Proceedings; In-Person Appearances Require Additional Commissioner's Approval Under Section 168
Circulars
GST – States
The Rajasthan Commercial Tax Department has mandated virtual hearings for all proceedings under RGST/CGST Act 2017 and other taxation laws, effective immediately. Under Section 168 of RGST Act, in-person appearances require prior approval from the Additional Commissioner upon written request. Taxpayers will receive hearing links via registered email, and representatives must submit authorization documents in advance. Documents must be submitted digitally, with physical submissions only through designated district-level facilitation desks with proper attestation. The order establishes protocols for technical issues, decorum requirements, and document handling procedures. All virtual proceedings and electronically submitted documents are deemed valid under Section 145 of RGST/CGST Act read with Section 4 of the IT Act, 2000.
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Tax Assessment Order Invalidated for Missing Officer Signature and Document Identification Number Under CGST Act
Case-Laws
GST
The HC set aside the impugned assessment order due to two fatal defects: absence of the assessing officer's signature and omission of the Document Identification Number (DIN). Relying on A.V. Bhanoji Row (2023), the court affirmed that an officer's signature on assessment orders is mandatory and cannot be rectified under Sections 160 & 169 of CGST Act, 2017. Additionally, following M/s. Cluster Enterprises (2024) and CBIC Circular No.128/47/2019-GST, the court held that omission of DIN number invalidates such proceedings. These procedural deficiencies rendered the assessment order legally untenable, resulting in its invalidation.
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GST Registration Cancellation Quashed Due to Non-Speaking Order and Failure to Follow FORM GST REG-19 Requirements
Case-Laws
GST
The HC quashed the GST registration cancellation order, finding it procedurally deficient as a non-speaking order that failed to conform with FORM GST REG-19 requirements. Despite the petitioner's delayed approach (filing after approximately one year), the Court determined that the order's statutory non-compliance outweighed concerns about delay. The Court remanded the matter to the show cause notice stage, providing the petitioner two options: either submit a reply demonstrating why registration should not be cancelled under Rule 22(2) of CGST Rules read with Section 29(2)(c) of CGST Act, or furnish all pending returns with full payment of tax dues, applicable interest, late fees and penalties.
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Petitioner Wins Refund Claim for Unutilized Input Tax Credit Under Section 54(3) of CGST Act Due to Inverted Tax Structure
Case-Laws
GST
The HC allowed the petition, quashing the impugned order and directing respondents to process the petitioner's refund claims for unutilized Input Tax Credit under Section 54(3) of CGST Act due to inverted tax structure. The court relied on its previous ruling in the petitioner's identical case, where it had held that refund claims deserved to be allowed. Finding this precedent directly applicable to the present facts, the HC ordered respondents to make payment of the refund together with applicable interest within six weeks from receipt of the order.
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GST Registration Cancellation Quashed: Retrospective Effect Invalid and Revocation Rejection Without Hearing Violates Section 30
Case-Laws
GST
The HC quashed the cancellation of GST registration and rejection of revocation application, finding that respondents failed to provide valid justification for the cancellation. The court noted that the original cancellation order improperly imposed retrospective effect from August 3, 2017, despite no such indication in the original Show Cause Notice. Furthermore, the rejection of the revocation application without granting the petitioner a hearing violated Section 30 of the CGST Act and principles of natural justice. The court set aside the impugned SCN, order-in-appeal, original cancellation order, and the order rejecting the revocation application.
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GST Appeal Dismissed: Time-Barred Filing Under Section 100(2) for Rent from Government SWCBH
Case-Laws
GST
The AAAR rejected the appellant's appeal against a ruling concerning GST on rent received from Govt SWCBH as time-barred. Though the appellant claimed they never received communication of the original order, evidence showed the ruling was emailed on 12.02.2024 to the appellant's email address (provided in their Form GST ARA-01). Per Section 100(2) of CGST Act, appeals must be filed within 30 days, with provision for extension up to another 30 days for sufficient cause. Since the order was communicated on 12.02.2024, the appeal should have been filed by 13.03.2024. Without valid justification for the 22-day delay, the appeal was dismissed.
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Setting Aside Partial AAR Ruling on GST for Land Development: AAAR Remands Case for Complete Adjudication Under Section 101
Case-Laws
GST
The AAAR determined that the appeal was not maintainable as the AAR had failed to address three questions in its original ruling. Since the questions regarding GST on developed plot sales, development services to landowners, transfer of development rights, valuation of services, and timing of tax payments were interlinked, the AAAR could not effectively decide on the partial ruling. Despite Section 101 of CGST Act, 2017 lacking explicit remand provisions, the AAAR set aside the lower authority's order and remanded the matter to the AAR for fresh consideration to ensure complete adjudication of all interrelated questions.
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ITC Must Be Reversed on Inputs Used for Goods Later Destroyed in Fire Under Section 17(5) of SGST Act
Case-Laws
GST
The AAAR held that a registered person must reverse Input Tax Credit (ITC) availed on inputs used to manufacture steel nails that were subsequently destroyed in a fire accident. While Section 16 of SGST Act, 2017 generally allows ITC on inputs used in furtherance of business, Section 17(5) specifically prohibits ITC on goods that are “lost, stolen, destroyed or written off.” The AAAR emphasized that Section 17(5) contains a non-obstante clause giving it overriding effect over Section 16(1) and Section 18(1). Therefore, despite the appellant's arguments regarding Section 16(1), the AAAR upheld the original Advance Ruling, requiring the appellant to reverse ITC on inputs used in manufacturing the destroyed finished goods.
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Input Tax Credit Cannot Be Denied When Seller's GST Registration Was Valid During Transaction Despite Later Cancellation
Case-Laws
GST
The HC held that the petitioner was entitled to Input Tax Credit (ITC) despite the seller's GST registration being canceled retrospectively. Since the transaction occurred on 06.12.2018 when the seller was validly registered, and the cancellation took effect from 29.01.2020, no adverse inference could be drawn against the petitioner. The Court emphasized that under Sections 16 and 74 of the GST Act and Rule 36 of GST Rules, ITC eligibility depends on conditions fulfilled at the time of transaction. The authorities failed to verify GSTR-1A, GSTR-3B, and tax deposits by the seller. The petition was allowed, and the matter remanded for fresh consideration with a reasoned order after hearing all stakeholders.
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Government Services to Telangana State Not Exempt Under Entry 6 of Notification 12/2017-CT Rate
Case-Laws
GST
The AAAR upheld the AAR's ruling that services provided by the appellant to the Telangana State Government are not exempt under GST. Entry 6 of Notification 12/2017 exempts services provided by the Government, not to the Government. Additionally, services provided by the appellant on behalf of the Government to business entities fall under the exception to this entry and are therefore taxable. The appeal was filed within the prescribed time limit (filed on 1.11.2021, within 30 days of AAR communication on 4.10.2021). The appellant's representatives confirmed during the hearing that GST has been paid on these services since inception, indicating no practical dispute exists.
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Blocking of Electronic Credit Ledger under Rule 86A quashed due to lack of reasoning and natural justice violation
Case-Laws
GST
The HC quashed the order blocking petitioner's Electronic Credit Ledger under Rule 86A of CGST/SGST Rules. The court found that the impugned order lacked independent reasoning, instead relying on enforcement authority reports which constituted “borrowed satisfaction.” Additionally, no pre-decisional hearing was granted to the petitioner before blocking the ECL, violating principles of natural justice. The order merely stated the registered person was “found to be a bill trader and involved in issuance/availment in fake invoices” without providing substantive reasoning. The court determined these procedural and substantive defects rendered the blocking order legally untenable and allowed the petition.
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Writ Application Dismissed Due to Defective Affidavit Where Deponent Failed to Establish Proper Authorization
Case-Laws
GST
The HC dismissed a writ application challenging seizure of goods and vehicle due to fatal procedural defects in the supporting affidavit. The deponent, Gopal Yadav, failed to establish proper authorization to represent all petitioners, claiming only to be the manager-cum-authorized representative of petitioner no.3. The affidavit lacked mandatory declarations that the deponent had reviewed the statements in the application or had them explained to him. These deficiencies rendered the affidavit legally insufficient under Patna HC rules. Finding the writ application incompetent due to improper representation, the court dismissed it as withdrawn.
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Aluminium Composite Panels Classified Under HSN 7606 with 18% GST Rate, Not Under HSN 3920 or 7610
Case-Laws
GST
The AAAR determined that Aluminium Composite Panels/Sheets are properly classified under HSN 7606, not under HSN 3920 or HSN 7610. Applying Rule 3(b) of the General Rules for Interpretation of Tariff, the Central Member concluded that the goods fall under Chapter 76 since aluminum gives the essential character to the ACPs. The contending Heading 7610 was ruled out as the subject goods are not aluminum structures or parts of structures. Following CESTAT precedent in Commissioner of Customs (Imports) Chennai Vs ICP India Pvt. Ltd., the panels were determined to be classifiable under Heading 7606 with an applicable GST rate of 18%.
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GST Summons Under Section 70 Doesn't Create Tax Liability or Initiate Proceedings Against Taxpayer
Case-Laws
GST
The HC addressed a challenge to a summons issued under s.70 of the GST Act seeking information from the petitioner. The court clarified that s.74 of the CGST Act applies to tax evasion cases involving willful misstatement or fraud, permitting penalties up to 100% of unpaid tax, with reduced penalties available at various stages of admission and payment. The court determined that the 2nd respondent's communication aligned with s.74 provisions and did not create liability or initiate proceedings against the petitioner. The petition was closed, preserving the petitioner's right to oppose any future proceedings for tax short payment, evasion, or wrongful ITC availment.
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Refund of Unutilized ITC Cannot Be Denied Merely Because Payments Were Remitted to Different Branch's Bank Account
Case-Laws
GST
The HC quashed an order denying refund of unutilized Input Tax Credit for FY 2022-23 and Q1 of FY 2023-24. The respondent had rejected the refund claim because payments for exported services by petitioner's Delhi branch office were remitted to a bank account in Bangalore. Relying on Cable and Wireless Global India Private Limited, the Court held that mapping a Bangalore bank account after receiving remittances validates that services were exported by the Delhi branch office. The Court found the respondent's objection overly technical and unsustainable, ruling that remittance to a Bangalore bank account does not preclude refund eligibility. The petitioner's claim was remanded for reconsideration.
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Refund of Unutilized Input Tax Credit on SEZ Supplies Cannot Be Denied for Procedural Non-Compliance
Case-Laws
GST
The HC quashed orders rejecting the petitioner's claim for refund of unutilized Input Tax Credit on supplies made to SEZ units without payment of tax. The Court held that once the respondents admitted the petitioner's entitlement to refund, the Court had jurisdiction to direct its grant despite procedural non-compliance with Circular No. 125/44/2019. The Court emphasized that while procedural requirements are important, they cannot extinguish substantive rights of the assessee under tax laws. Allowing the Department to retain excess tax would constitute unjust enrichment contrary to Article 265 of the Constitution. The Court ruled that procedure must remain subservient to substantive justice, particularly in genuine refund cases where the assessee's rights are established.
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Electricity and Water Charges by Lessor to Lessee Form Part of Renting Services Under Section 8(a), Attracting GST
Case-Laws
GST
The AAAR determined that electricity and water charges collected by a lessor from a lessee constitute part of the principal supply of “renting of immovable property” under Section 8(a) of the CGST Act, not a separate supply. The lessor cannot be considered a pure agent as there is no sub-meter in the lessee's name and no authorization for payment. The exemption for electricity transmission/distribution services under Notification No. 12/2017-CT(R) does not apply as the lessor is neither a Distribution nor Transmission Licensee under the Electricity Act, 2003. Consequently, GST is applicable on the entire consideration including electricity and water charges at the rate applicable to renting services.
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GST Registration Cancellation Overturned as Authorities Failed to Establish Rule 21 Violations or Improper Registration
Case-Laws
GST
The HC set aside the cancellation of petitioner's GST registration, finding that authorities failed to follow proper procedural requirements. The appellate authority had rejected the appeal solely because the HSN/SAC code disclosure in registration applications suggested two registrations covered the same business. However, the court determined that authorities did not establish any violations under Rule 21 of the GST Act, which prescribes specific conditions for registration cancellation. The revenue department also failed to demonstrate that petitioner obtained registration by breaching conditions under Section 29(2) read with Rule 21. The court directed immediate restoration of the petitioner's GST registration upon presentation of the order.
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GST Ex-Parte Order Set Aside: Taxpayers Must Receive Proper Notice Under Section 73 Before Assessment
Case-Laws
GST
The HC set aside an ex-parte order issued without proper service of show cause notice, finding it violated principles of natural justice. Following precedents established in Ola Fleet Technologies and Akriti Food Industry cases, the Court determined that taxpayers facing liability must receive opportunity to present their defense. Rather than prolonging litigation, the HC directed that the impugned order dated 30.12.2023 should be treated as notice under Section 73 of the GST Act, 2017, allowing the petitioner to file objections and submit relevant documentation to the assessing officer for fresh consideration. The petition was accordingly disposed of with directions for the assessing authority to pass a fresh order after considering the petitioner's submissions.
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ITC Denied on Employee Transportation Services Under Section 17(5) as No Statutory Obligation Exists
Case-Laws
GST
The AAAR dismissed the appeal regarding eligibility to claim ITC on GST paid for employee transportation services. The authority ruled that under Section 17(5) of CGST Act, ITC is available only when provision of such services is statutorily obligatory for employers. Since the appellant provided transportation merely as a convenience measure for employees at a remote factory location without any statutory obligation, ITC was disallowed. Additionally, per CBIC Circular No. 172/04/2022-GST, transportation services provided as contractual perquisites fall under Schedule III and are non-taxable. Consequently, ITC on inward services used for providing such non-taxable services cannot be availed.
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Input Tax Credit Cannot Be Denied for GSTR-3B Returns Filed Late When Section 16(5) Amendment Provides New Cut-off Date
Case-Laws
GST
The HC quashed an order disallowing Input Tax Credit (ITC) claimed by the petitioner in GSTR-3B returns filed beyond the due date under WBSGST/CGST Act, 2017. The Court held that the subsequent amendment to Section 16(5) had regularized the petitioner's returns for tax period April 2018 to March 2019 by providing a new cut-off date, and therefore the petitioner could not be denied the benefit of this amendment. The petitioner was permitted to apply before the appropriate authority by making a rectification application. The petition was accordingly disposed of.
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Assignment of MIDC Land Leasehold Rights to Third Party for Lump Sum Payment Not Subject to GST
Case-Laws
GST
The HC ruled that assignment of leasehold rights in MIDC land along with buildings to a third party for lump sum consideration is not subject to GST. Following Gujarat HC's precedent in Gujarat Chambers of Commerce case, the court determined that such transactions constitute transfer of benefits arising from “immovable property,” with the assignee becoming the new lessee in place of the original allottee. The court held that Section 7(1)(a) of the GST Act read with clause 5(b) of Schedule II and clause 5 of Schedule III does not apply to such transactions, exempting them from GST under Section 9. The HC stayed adjudication of the Show Cause Notice dated November 13, 2024.
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