Goods and Services Tax

DGGI probe detects Rs 1,196 cr fraudulent Input Tax Credit transactions
GST
Dated:- 12-2-2025
PTI
Pune, Feb 12 (PTI) The Directorate General of GST Intelligence (DGGI) has unearthed fraudulent Input Tax Credit (ITC) transactions amounting to Rs 1,196 crore by exposing a network of bogus companies and arrested a person, as per an official release.
DGGI, Pune zonal unit, conducted searches at multiple locations in Pune, Delhi, Noida and Muzaffarnagar. The investigation showed that the accused had set up shell entities that generated fake invoices and e-way bills.
“These e-way bills had no RFID movements associated with them, confirming the absence of the actual supply of goods. The fraudulent network facilitated the availing and

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Central Government Sets Phased Implementation Dates for CGST Amendment Rules Under Section 164 Starting February 2025
Notifications
GST
The Central Government, exercising powers under Section 164 of CGST Act 2017, has notified the implementation dates for specific provisions of CGST (Amendment) Rules 2024. Rules 2, 24, 27, and 32 will come into effect from February 11, 2025, while Rules 8, 37, and clause (ii) of Rule 38 will be implemented from April 1, 2025. This notification, issued by CBIC, establishes a phased implementation approach for the amended rules, ensuring systematic adoption of the new GST provisions. The staggered implementation allows stakeholders adequate time to adapt to the regulatory changes while maintaining administrative efficiency in tax governance.
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GST evasion racket busted in Thane; 1 held
GST
Dated:- 12-2-2025
PTI
Thane, Feb 12 (PTI) Authorities have busted a Goods and Services Tax (GST) evasion racket involving a fraudulent input tax credit (ITC) scam of Rs 26.92 crore and arrested its “mastermind” in Maharashtra's Thane district, officials said.
The accused, Kapadiya Mahamad Sultan, orchestrated the fraud by setting up 18 fictitious entities which were used to generate fake invoices and claim ITC without any actual supply of goods or services, CGST Joint Commissioner Amit Kumar Singh said in a release issued on Tuesday.
Sultan, resident of Mira Road area in Thane, was arrested on Monday, the official said.
Investigations suggested that Sultan exploited the Aadhaar

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GST Registration Cancellation Invalid: Show Cause Notice Under Rule 21(b) Lacked Specific Violations and Reasoned Order
Case-Laws
GST
HC determined the cancellation of GST registration invalid due to procedural deficiencies. The show cause notice (SCN) merely cited Rule 21(b) of CGST Rules 2017 without specifying material violations, preventing adequate response from the registrant. Despite the registrant's explanation of bank-verified invoices, the assessing authority failed to provide reasoned consideration of the response. The authority's single-line cancellation order, lacking substantive examination of the reply, was deemed insufficient to justify registration cancellation. The court emphasized that mere citation of legal provisions without detailed violation particulars and failure to provide reasoned orders violates principles of natural justice. The petition was allowed, invalidating the registration cancellation.
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Provisional Attachment Order Under Section 83 CGST Act Invalidated Due To Lack Of Reasoning And Necessity
Case-Laws
GST
HC quashed provisional attachment order under Section 83 of CGST Act, finding it legally deficient on multiple grounds. The order lacked tangible material justifying attachment necessity, failed to disclose substantive reasons beyond mere statutory reproduction, and showed no application of mind regarding jurisdictional elements. While Section 83 permits immediate action without pre-decisional hearing to protect revenue interests, it does not dispense with the requirement to provide reasoning. The Court rejected respondent's technical arguments about form limitations, emphasizing that fundamental principles of reasoned decision-making cannot be sacrificed for expediency. The attachment was invalidated for failing to demonstrate necessity through proper reasoning and for not considering less restrictive alternatives.
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Assessment Order Under Section 73 of GST Act Quashed as Time-Barred, Exceeding Three-Year Limitation Period
Case-Laws
GST
HC quashed demand order and show cause notice issued under Section 73 of UP GST Act 2017. For FY 2017-18, annual return filing deadline was extended to 05.02.2020. Per Section 73(10), three-year limitation period for passing assessment order would expire on 05.02.2023. Assessment order dated 02.12.2023 was time-barred as it exceeded statutory limitation period. Court held orders dated 02.12.2023 and 29.09.2023 passed by Asst. Commissioner were void being beyond limitation period prescribed under Section 73. Petition allowed with orders quashed for being time-barred.
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Tax Authority's GST Demand Order Invalid Due to Missing Show Cause Notice Under Section 73 AGST Act
Case-Laws
GST
HC quashed the impugned order dated 30.12.2023 due to procedural non-compliance with Section 73 of AGST Act, 2017. The authority failed to issue a proper Show Cause Notice as mandated under Section 73(1), instead only serving a Summary Notice in Form GST DRC-01. The court emphasized that compliance with subsections (1) to (8) and (10) to (11) of Section 73, along with Rule 142(1), are prerequisite conditions for validity of orders under Section 73(9). The absence of a proper Show Cause Notice violated principles of natural justice, rendering the tax determination order legally unsustainable. The petition was disposed of in favor of the petitioner.
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Input Tax Credit Claim Valid Under Amended Section 16; Reversal Orders Quashed and Credit Amounts Restored
Case-Laws
GST
HC held that petitioner's claim for input tax credit (ITC) was valid under amended Section 16 provisions. Following precedent established in Sri Ganapathi Pandi Industries case, the court affirmed taxpayer's entitlement to avail ITC for the disputed financial periods. The reversal of ITC along with associated penalties and interest was set aside. The court's ruling reinforces the principle that ITC claims meeting statutory requirements under amended provisions cannot be denied retrospectively. Original assessment orders requiring reversal were quashed, with directions to restore the claimed ITC amounts to the petitioner's electronic credit ledger.
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GST Registration Cancellation Cannot Be Retrospective Without Prior Notice And Reasons In Show Cause Notice
Case-Laws
GST
HC invalidated the retrospective cancellation of GST registration due to procedural deficiencies in the show cause notice (SCN). The original SCN failed to disclose the intent for retrospective cancellation or provide supporting reasons, violating principles of natural justice. The Court determined that absence of prior notice regarding retrospective action rendered the cancellation order invalid from February 13, 2024. While upholding the cancellation itself, the Court modified the effective date to align with the SCN issuance date of November 7, 2024, ensuring procedural fairness and due process in administrative action.
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Tax Assessment Order Quashed: Section 169 Violation for Improper Notice Delivery and Denial of Fair Hearing Opportunity
Case-Laws
GST
HC quashed assessment order for 2018-19 due to violation of natural justice principles under Section 169. Authority failed to serve proper notice seeking explanation regarding alleged defects. Following precedent established in prior cases, Court affirmed mandatory requirement of notice delivery either in person, registered post, or registered email. Only upon impracticability of these methods can alternative publication through portal/newspaper be considered. Assessment order converted to show cause notice, allowing petitioner opportunity to respond. Decision upholds fundamental right to be heard before adverse action, reinforcing procedural safeguards in tax assessment proceedings.
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Port Authority's Land Lease for Commercial Complex Not Exempt Under Entry 41, Must Pay GST on Services
Case-Laws
GST
AAAR ruled that long-term land lease services by Port Authority to Company A for establishing a commercial office complex does not qualify for GST exemption under Entry 41 of Notification 12/2017-CT(Rate). The authority determined that constructing an office complex for corporate use and rental purposes constitutes neither industrial nor financial activity. The definition specifically excludes industrial buildings, and mere maintenance of accounts cannot be equated with financial activity. Additionally, the Port Authority failed to meet the ownership threshold requirement of 20% government stake. Consequently, the lease services for commercial office complex development remain taxable under GST, as they do not satisfy the essential conditions for exemption under the notification.
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FM dispels concern of rise in GST rate, says there is not even one such item
GST
Dated:- 11-2-2025
PTI
New Delhi, Feb 11 (PTI) Finance Minister Nirmala Sitharaman on Tuesday dispelled concerns over a rise in Goods and Services Tax (GST), saying that there is not even one item on which the rate has been increased after the implementation of GST regime.
Intervening during Question Hour in Rajya Sabha, Sitharaman stated that GST rates have been brought down and the average GST rate has come down to 11.3 per cent from 15.8 per cent (at the time of GST implementation).
“That is the level of rate of reduction in the GST Council. Therefore I appeal to all the members here, kindly spare some time, meet your respective finance minist

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lso pointed out that the GST Council is a constitutional body.
She also said, “I would to take this opportunity to dispel this thought after GST implementation, rates have gone up. Not at all.” She asked that is there an obstruction by the union government members, MOS and myself, to (where we have said) say no no, don't reduce the rate, we want to burden the consumer.
“Is there be an instance? One such instance,” she said.
She also explained in the written reply on the oral question tabled in the House that as per Article 279A (4) of the Constitution of India, the GST Council shall make recommendations to the Union and the States, on rates, including floor rates with bands of goods and service tax.
Thus, the GST rates are notifie

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Lottery distributors not liable to pay service tax to Centre: SC
GST
Dated:- 11-2-2025
PTI
New Delhi, Feb 11 (PTI) Lottery distributors are not liable to pay service tax to the Union government, the Supreme Court held on Tuesday while dismissing an appeal of the Centre on the issue.
A bench comprising Justices BV Nagarathna and NK Singh did not agree to the appeal of the Centre against the Sikkim High Court judgement.
“Since there is no agency in the relationship, the respondents (lottery distributors) were not liable to pay service tax. However, the respondents will continue to pay the gambling tax levied by the state under Entry 62, List II of the Constitution,” Justice Nagarathna said while pronouncing the verdict.
“Ser

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Tax Assessment Order Quashed as Notice Lacked Document Identification Number Required Under CBIC Circular 128/47/2019-GST
Case-Laws
GST
HC set aside GST assessment proceedings due to absence of Document Identification Number (DIN). Following established precedents and CBIC Circular No.128/47/2019-GST mandating DIN, the court held that non-inclusion of DIN invalidates tax proceedings. While quashing the impugned order dated 17-10-2024, HC granted liberty to tax authorities to initiate fresh assessment after proper notice and DIN assignment. The ruling reinforces procedural compliance requirement of DIN in GST proceedings as a mandatory safeguard, consistent with prior Division Bench decisions in similar matters involving procedural irregularities in tax assessments.
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Tax Authorities Must Initiate Recovery Within One Year of ITC Block Under Rule 86A to Prevent Automatic Unblocking
Case-Laws
GST
HC affirmed that blocking under Rule 86A of Orissa GST Rules serves as revenue security by preventing utilization of future ITC through negative balance insertion in electronic credit ledger. The court emphasized the necessity for tax authorities to initiate recovery proceedings within the one-year blocking period, as automatic unblocking would otherwise allow dealers to access and debit ITC from their electronic ledger. The temporary restriction mechanism ensures tax authorities can secure potential recoveries while maintaining procedural safeguards. The ruling clarifies that such preventive measures are valid when aligned with proper recovery actions within the prescribed timeframe.
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Tax Authority Must Allow Taxpayer Final Hearing Before Assessment After 25% Payment Commitment Under GST Law
Case-Laws
GST
Petitioner contested order regarding deficient monthly returns and lack of supporting documentation. Following precedent in K. Balakrishnan case, HC set aside the impugned order. Petitioner demonstrated willingness to pay 25% of disputed tax amount and requested final opportunity for presenting objections before adjudicating authority. Government Pleader raised no substantial opposition. HC disposed of writ petition by setting aside original order, allowing petitioner to present case before adjudicating authority with commitment to partial tax payment, aligning with established GST procedural jurisprudence on opportunities for taxpayer representation.
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GST Officers' Cash Seizure Ruled Illegal; Income Tax Transfer Under Section 132A Cannot Validate Unauthorized Action
Case-Laws
GST
HC determined the initial cash seizure by state GST officers was unlawful, lacking statutory authority under CGST/SGST Act. The subsequent transfer of seized funds to Income Tax Department under Section 132A of IT Act could not legitimize the original illegal seizure. The court emphasized constitutional principles under Articles 265 and 300A protecting against unauthorized property expropriation and taxation. Neither GST Department nor Income Tax Department could retain the seized cash prior to completing their respective proceedings. The ruling reinforces fundamental constitutional safeguards against arbitrary state action in tax enforcement matters. Appeal resolved with direction to release seized funds pending completion of formal proceedings.
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Taxpayers eligible for interest and penalty waiver under Section 128A despite departmental appeals on tax demands
Circulars
GST
CBIC clarifies procedure for departmental appeals regarding interest/penalty under Section 128A of CGST Act. Where taxpayers have fully paid tax demands under Section 73 for FY 2017-20, they remain eligible for interest/penalty waiver even if department has filed or plans to file appeal concerning incorrect interest calculations or penalty impositions. Proper officers should withdraw such departmental appeals or accept orders under review if taxpayers meet other Section 128A conditions. This interpretation aims to reduce litigation and prevent denial of benefits on technical grounds, extending relief to compliant taxpayers facing disputes solely over interest/penalty components.
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GST Appeals Must Be Filed Within 4 Months: No Power to Condone Delay Beyond Section 107 Limitation Period
Case-Laws
GST
HC held that appellate authority lacks inherent power to condone delay beyond statutory limits under CGST Act Section 107. Appeals must be filed within three months of order communication, with discretionary one-month extension for sufficient cause under Section 107(4). Where legislation creates special limitation regime with terminal date, general provisions of Limitation Act do not apply. Appellate authority's condonation power is strictly confined to statutory framework. Appeals filed beyond combined four-month period (three months plus one month extension) under Section 107(1) and 107(4) were dismissed as time-barred. Court emphasized that statutory remedies must strictly adhere to prescribed limitation periods in special tax legislation.
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Voluntary GST Payment Through Form DRC-03 Accepted as Valid Pre-Deposit for Appeal Against Original Order
Case-Laws
GST
HC ruled that voluntary payment made through Form GST DRC-03 constitutes valid pre-deposit for filing appeal against order-in-original, even though Form GST DRC-03A was introduced later. Following Circular No.224/18/2024-GST's clarification that DRC-03 payments shall be considered equivalent to DRC-03A pre-deposits, the Court set aside the rejection order dated 26.07.2024. The appeal was restored, with direction to consider the amount paid via DRC-03 as valid pre-deposit. The Court noted that despite multiple adjournments, authorities failed to verify the payment status, while funds remained in DRC-03. The petition was disposed of with instructions to accept the existing payment as legitimate pre-deposit for appeal purposes.
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Tax Department's 24-Hour Notice and 48-Hour Reply Window Violates Natural Justice, Order Set Aside for Fresh Hearing
Case-Laws
GST
HC held that principles of natural justice were violated when tax authorities provided insufficient time to petitioner for filing reply and personal hearing. The impugned order was deemed arbitrary and illegal as authorities gave only 24 hours notice for hearing and 48 hours for manual reply submission, followed by order passage within 24 hours thereafter. Court criticized departmental practice of solely relying on online portal notifications without RPAD communication. The matter was remanded back for reconsideration with direction to provide adequate opportunity of hearing. Court emphasized that opportunity of hearing must be meaningful rather than nominal, recommending adoption of RPAD notices alongside digital communications to ensure proper service and prevent wastage of departmental time.
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Show Cause Notice Under GST Section 73(2) Invalidated Due To Two-Day Delay In Mandatory Timeline
Case-Laws
GST
HC ruled on the validity of a show cause notice (SCN) under GST law regarding time limitations. The Court examined Section 73(2) and 75 of GST Act, determining that statutory timelines for issuing SCNs are mandatory, not directory. Drawing parallels with precedent from arbitration law, HC emphasized taxpayer protections including right to notice, personal hearing, and adequate response time. The two-day delay in issuing SCN could not be condoned as the provision was deemed mandatory, not directory. Court held that violation of prescribed time period under Section 73(2) renders SCN void, protecting taxpayer's procedural rights. Petition challenging the delayed SCN was allowed, effectively invalidating the assessment proceedings.
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Tax Determination Order Quashed: Authority Failed to Issue Proper Show Cause Notice Under Section 73(1) of AGST Act
Case-Laws
GST
HC invalidated tax determination order due to procedural non-compliance with AGST Act 2017. Authority failed to issue proper Show Cause Notice (SCN) under Section 73(1), instead providing only a summary notice and tax determination attachment. Court emphasized that SCN summary cannot substitute statutorily mandated full notice. Proper officer must issue complete SCN, statement under Section 73(3), and final order under 73(9). Compliance with subsections (1)-(8) and (10)-(11) of Section 73, along with Rule 142(1), are prerequisite for valid order under Section 73(9). Following precedent in Construction Catalysers case, court quashed impugned order for failing fundamental procedural requirements of natural justice.
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GST Orders Quashed After Tax Department Failed to Serve Physical Notices and Denied Hearing Opportunity to Assessee
Case-Laws
GST
HC invalidated ex parte orders issued by tax authorities due to violation of natural justice principles. The respondent-Department failed to properly serve notices through physical means, only posting them on GST Portal's 'View of additional notices and orders' section, which petitioner was unaware of. The Court found that passing orders without providing opportunity for hearing violated fundamental procedural fairness. Orders were set aside and matter remanded to first respondent for fresh consideration with direction to ensure proper notice and hearing opportunity to petitioner. The ruling emphasizes mandatory compliance with natural justice principles in administrative proceedings, particularly regarding adequate notice and right to be heard.
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Bank Account Freeze Orders Partially Lifted: HDFC Account Fully Released, SBI Account Unfrozen Up To Rs. 70 Lacs
Case-Laws
GST
HC partially lifted provisional attachment orders on bank accounts in tax liability dispute. Account in HDFC Bank Limited was completely unfrozen, while State Bank of India account received partial relief with debit restrictions lifted up to Rs. 70 Lacs. The freeze order remains effective for amounts exceeding Rs. 70 Lacs in the SBI account. Court balanced taxpayer's operational needs with revenue protection, allowing limited access to funds while maintaining security for potential tax recovery. The ruling demonstrates judicial discretion in modifying attachment orders based on proportionality and business necessity considerations.
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