Goods and Services Tax

AAP govt stabilised state's declining economy: Punjab FM
GST
Dated:- 23-7-2025
PTI
Derabassi (Pb), Jul 23 (PTI) Punjab Finance Minister Harpal Singh Cheema on Wednesday said the AAP government has successfully stabilised the state's declining economy during its three-year tenure.
He emphasised that consistent efforts are underway to further enhance Punjab's performance in gross state domestic product (GSDP) and other key economic indicators.
He was addressing a gathering at an even

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GST notice row: Won't pursue cases 2-3 years old, assures CM; traders withdraw strike call
GST
Dated:- 23-7-2025
PTI
Bengaluru, Jul 23 (PTI) With small traders in Karnataka going on the warpath over the government issuing GST notices based on UPI transactions and the opposition backing them, the state government on Wednesday announced that cases ranging between 2-3 years won't be pursued, prompting the trade bodies to call of their proposed agitation on July 25.
Although, the government asserted that the action of issuing notices was within the framework of law.
On Wednesday, Chief Minister Siddaramaiah held discussions with traders' associations, which raised concerns about confusion over the GST notices, many of which include loan amounts and personal transactions.
State BJP President B Y Vijayendra accused the CM of setting targets for the Commercial Taxes Department, which had issued the notices to small and micro traders. While urging the government to withdraw th

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x net,” he said.
He clarified that businesses dealing exclusively in exempted goods will not be required to register.
The chief minister, in a statement, said that notices were issued only to traders with UPI transactions exceeding Rs 40 lakh, primarily to prompt GST registration.
Siddaramaiah reaffirmed his commitment to supporting small traders and ensuring lawful business practices.
He said the government will assist in timely tax payments and strengthen the existing helpline for better accessibility.
Several traders' associations had earlier called on these businesses to boycott UPI transactions and announced a statewide strike on Friday.
Lashing out at the ruling Congress over the matter, Vijayendra accused Siddaramaiah of setting targets for the Commercial Tax Department “The Commercial Tax Department issuing GST notices to small and micro traders has sparked widespread concern. These traders are deeply worried, while the chief minister and his ministers are attemptin

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be dropped.
The top tax official termed the issuing of notices as within the framework of law.
“When a person reaches the threshold limit of Rs 20 lakh for services or Rs 40 lakh for goods, it is mandatory for the person to get registered under the GST Act to take registration and declare his turnover,” the officer told PTI.
“The registration empowers the trader to collect taxes from the consumers and pay it to the government. These taxes are meant for the government, but when the dealers collect them and fail to remit them, they are treated as unregistered persons, and we issue notices accordingly,” she added.
The department, she said, cannot individually identify every trader evading registration. Instead, the Services Analysis Wing at the department's head office used reliable sources such as UPI transaction data to flag potential defaulters.
“If a person has transacted over Rs 20 lakh for services or Rs 40 lakh for goods in a year through UPI, it indicates that they may b

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CM Siddaramaiah says 3-yr-old tax arrears won't be pursued, traders call off strike
GST
Dated:- 23-7-2025
PTI
Bengaluru, Jul 23 (PTI) Karnataka Chief Minister Siddaramaiah on Wednesday announced that the state government will not pursue tax notices issued to traders for arrears on exempted goods and services over the past three years. Following this, traders agreed to call off their planned strike on July 25 in the city.
The protest had been triggered by tax notices linked to Unified Payment Interface (UPI) transactions, with traders in parts of Bengaluru and across Karnataka “calling for a boycott of UPI payments.” According to the Commercial Taxes Department, around 6,000 such notices were issued across the state based on UP

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ut confusion among small traders over GST notices, many of which include loan amounts and personal transactions.
The chief minister said the government will not pursue these arrears and will ensure traders do not face problems—provided they register with the Commercial Tax Department.
“Traders must register. Registration is mandatory because everyone needs to be brought within the tax net,” he said.
He clarified that businesses dealing exclusively in exempted goods will not be required to register.
“We will not pursue notices pertaining to goods and services that are exempted—such as bread, milk, essential food items, fruits and vegetables, flowers, and tender coconut,” Siddaramaiah explained.
He also announced the setting up of a help

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State confirms no GST revenue loss from out-of-state corporate billing under destination-based GST rules
News
GST
The state government confirmed that there has been no loss of Goods and Services Tax (GST) revenue due to companies routing sales and billing through corporate offices outside the state. Under the destination-based GST regime effective from July 2017, tax revenue accrues to the state where goods or services are consumed, not where they are manufactured or billed. Consequently, the state receives GST on all goods and services consumed within its territory regardless of the location of the corporate office. Similarly, goods manufactured within the state but consumed elsewhere result in tax revenue accruing to the state of consumption. This clarification was provided in response to concerns raised about potential revenue loss from out-of-state billing practices.
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State Tax Dept Sends 6,000 GST Notices Using UPI Data, Allows Responses Before Final Demand Under Section 9
News
GST
A state tax department issued approximately 6,000 GST demand notices to traders based on UPI transaction data, alleging non-registration despite turnover thresholds requiring GST registration. The notices are preliminary, allowing recipients to respond with evidence of exemptions or compliance before final demands are made. Traders' associations protested, calling for strikes and boycotts of digital payments, citing confusion and lack of prior warning. The tax authority emphasized the legality and procedural fairness of the notices, stating they follow natural justice principles and offer multiple opportunities for response and clarification. Concerns were raised about the use of UPI data alone without distinguishing exempt goods or services, leading to calls for clearer guidelines, better communication, and nuanced enforcement to prevent undue hardship on small traders. The department affirmed ongoing efforts to educate and assist traders regarding GST obligations.
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Karnataka BJP chief slams CM Siddaramaiah over GST notices to small traders, seeks withdrawal
GST
Dated:- 23-7-2025
PTI
Bengaluru, Jul 23 (PTI) Karnataka BJP President B Y Vijayendra on Wednesday accused Chief Minister Siddaramaiah of setting targets for the state's Commercial Tax Department, which is issuing GST notices to small and micro traders and urged the government to withdraw them.
He extended the BJP's support to the agitation announced by a section of small and micro traders, who have objected to receiving GST notices linked to their UPI transactions.
Several traders' associations have called on these businesses to boycott UPI transactions and have announced a statewide strike on July 25.
“The Commercial Tax Depart

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rt for the traders' protest, the state party chief said even small vendors selling milk and curd have been served GST notices.
“There are three slabs under GST, but the Commercial Tax Department is serving 18 per cent tax notices to everyone indiscriminately,” he claimed.
“These notices are being issued without proper verification or analysis, purely because the state lacks funds. This has caused serious anxiety among traders,” he said, urging the chief minister to ensure that “the government withdraws these notices immediately.” On a separate issue, Vijayendra commented on the Supreme Court's dismissal of the Enforcement Directorate's plea against CM Siddaramaiah's wife in the MUDA site allotment case.
While welcoming the court's de

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rs also have the strength to hold counter-protests in front of the KPCC office, if needed.
“If Congress workers want to protest, they should go to Freedom Park, the designated spot. Instead, they're indulging in goondaism in the name of protest-this is unacceptable,” he said, adding that the BJP has also met the city police commissioner and urged action against such behaviour.
Stating that such actions were inappropriate, Vijayendra urged Deputy CM Shivakumar to withdraw from them.
He alleged that the Congress government had yet to allocate the promised Rs 50 crore for development in each legislator's constituency, and claimed the announcement was merely a ploy to silence ruling party MLAs who were publicly questioning the Chief Minister

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GST notices based on UPI transactions: K'taka traders on warpath, official tells action as per law
GST
Dated:- 23-7-2025
PTI
Bengaluru, Jul 23 (PTI) Amid rising concerns among traders in Karnataka over the issuance of nearly 6,000 GST demand notices based on UPI transaction data, a top tax official has termed the action as within the framework of law.
Traders' bodies have called for a strike over the matter.
Speaking to PTI, Meera Suresh Pandit, Joint Commissioner of Commercial Taxes, also clarified that notices are not final tax demands and the recipients have the right to respond with supporting documentation. If the reply is convincing or the goods and services are exempted under the GST Act, notices will be dropped, she added.
Reacting to the issue of notices sent to traders based on UPI transactions, a number of traders associations in the state have given a call to the traders to boycott UPI transactions. They have also called for a strike on July 25.
Responding t

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es that they may be liable to register under GST,” Pandit said, adding that notices were based only on preliminary data, not final determinations.
The officer said the department is not aware whether the turnover is entirely exempted, partially taxable, or fully taxable. That is why the notice includes a proposal to register and pay applicable taxes, interest, and penalties.
“If the turnover is completely exempted from goods or services like tuition fees, the registration is not required. If the reply is convincing, the notice will be dropped and proceedings will close with a nil demand,” Pandit clarified.
She also addressed doubts prevailing among the trading circles.
“Some innocent traders are being carried away, hoping every notice will be withdrawn. Some are being misled. But if they want relief within legal provisions, I request them to come to the department. We will guide them as per the law,” the Joint Commissioner said.
“Calling for a 'Bandh' will not serve the purpose. T

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ensure every opportunity is given. When you buy a plot, you go to the sub-registrar's office without being told. Likewise, traders should know applicable tax laws. Ignorance cannot be an excuse. The department is always there to guide,” she said.
Trade activist Sajjanraj Mehta raised concerns over the fairness of recent GST notices.
He stated that while the Commercial Taxes Department is legally within its powers to use such data, the lack of prior warning, context, and education has created confusion.
“Many small traders were unaware that their UPI inflows, often a mix of business and personal transactions, would be treated as undeclared turnover,” Mehta told PTI.
“The fairness issue lies not in enforcement itself, but in the suddenness and lack of clarity,” he added.
Mehta stressed that the department should differentiate between exempt and taxable goods before sending notices.
Issuing notices without accounting for exempt goods like fruits, vegetables, or unbranded food items

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GST notices based on UPI transaction: Traders on warpath, official calls action proper
GST
Dated:- 23-7-2025
PTI
Bengaluru, Jul 23 (PTI) Amid rising concerns among traders in Karnataka over the issuance of nearly 6,000 GST demand notices based on UPI transaction data, traders' bodies gave a strike call, while a top tax official termed the action to be within the framework of law.
Speaking to the PTI, Meera Suresh Pandit, Joint Commissioner of Commercial Taxes, has also clarified that notices are not final tax demands and the recipients have the right to respond with supporting documentation. If the reply is convincing or the goods and services are exempted under the GST Act, notices will be dropped, she added.
Reacting to the issue of notices sent to traders based on UPI transactions, a number of Traders Associations in Karnataka have given a call to the traders to boycott UPI transactions. They have also called for a strike on July 25.
Responding to the reports of a pro

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it indicates that they may be liable to register under GST,” Pandit said, adding that notices were based only on preliminary data, not final determinations.
The officer said the department is not aware whether the turnover is entirely exempted, partially taxable, or fully taxable. That is why the notice includes a proposal to register and pay applicable taxes, interest, and penalties.
“If the turnover is completely from exempted goods or services like tuition fees, the registration is not required. If the reply is convincing, the notice will be dropped and proceedings will close with a nil demand,” Pandit clarified.
She also addressed doubts prevailing among the trading circles.
“Some innocent traders are being carried away, hoping every notice will be withdrawn. Some are being misled. But if they want relief within legal provisions, I request them to come to the department. We will guide them as per the law,” the Joint Commissioner said.
“Calling for a 'Bandh' will not serve the

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justice and ensure every opportunity is given,” she added.
“When you buy a plot, you go to the sub-registrarÂ’s office without being told. Likewise, traders should know applicable tax laws. Ignorance cannot be an excuse. The department is always there to guide,” she said.
However, trade activist Sajjanraj Mehta raised concerns over the fairness of recent GST notices.
He stated that while the Commercial Taxes Department is legally within its powers to use such data, the lack of prior warning, context, and education has confused.
“Many small traders were unaware that their UPI inflows, often a mix of business and personal transactions, would be treated as undeclared turnover,” Mehta told PTI.
“The fairness issue lies not in enforcement itself, but in the suddenness and lack of clarity,” he added.
Mehta stressed that the department should differentiate between exempt and taxable goods before sending notices.
“Issuing notices without accounting for exempt goods like fruits, vegetable

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No GST loss to Goa from out-of-state corporate billing: CM Sawant
GST
Dated:- 23-7-2025
PTI
Panaji, Jul 23 (PTI) Chief Minister Pramod Sawant has said Goa has not incurred any loss in the Goods and Services Tax (GST) revenue due to companies routing their sales and billing through corporate offices located outside the state.
In a written reply tabled in the Goa assembly on Tuesday during the ongoing monsoon session, Sawant, who also holds the finance portfolio, said the GST regime rolled out with effect from July 01, 2017 is a destination or consumption-based tax regime.
“Therefore, the tax on goods and/or services gets accrued to the State/UT where it is actually consumed,” Sawant said.
“Therefore, there is no question of

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Court upholds finality of composite SCN order, affirms wide appellate powers under Section 107(11) CGST Act
Case-Laws
GST
The HC dismissed the petition seeking modification of the order adjudicating a composite SCN against the Petitioners and challenging the vires of N/N. 06/2020-Central Tax. The Court held that under Section 2(4) of the CGST Act, the Adjudicating Authority excludes the Appellate Authority, which has full power to consider the matter afresh on appeal under Section 107. The adjudication order was detailed and considered the Petitioners' submissions, including those related to multiple financial years. The legislative intent prohibits remanding the matter back to ensure finality, but the Appellate Authority may confirm, modify, or annul the order on merits. Reliance on precedents affirmed the wide scope of appellate powers under Section 107(11). Consequently, the Court declined to interfere and dismissed the application for modification.
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Appeal dismissed for being three years late; limitation period strictly capped at 30 days under relevant rules
Case-Laws
GST
The HC upheld the dismissal of the appeal filed three years and twenty days beyond the prescribed limitation period, affirming that the appellate authority's power to condone delay is strictly limited to thirty days. The court relied on established precedents interpreting analogous statutory provisions, emphasizing that no residual discretion exists to extend limitation beyond the specified period under the relevant Acts. Consequently, the writ petition challenging the order was dismissed, reinforcing the principle that courts and tribunals cannot entertain appeals filed beyond the statutory time frame except within narrowly prescribed limits.
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Composite GST show cause notices for multiple years violate Sections 73 and 74 limitation rules, must be issued yearly separately.
Case-Laws
GST
The HC held that issuance of a composite show cause notice (SCN) covering multiple financial years under the GST Act is impermissible. Each financial year constitutes a separate tax period with distinct limitation periods under Sections 73 and 74. The limitation of three or five years applies individually to each financial year and cannot be aggregated or carried forward to justify a bundled SCN. Issuing a single SCN for multiple years violates the statutory scheme, frustrates the limitation framework, and infringes the taxpayer's right to contest year-specific demands, resulting in jurisdictional overreach and rendering such orders void ab initio. The GST Act mandates SCNs to be issued based on the relevant tax period-monthly or annual returns-and prohibits issuance beyond the prescribed period. Accordingly, the petition challenging the bunching of SCNs was allowed, reaffirming that separate adjudication per financial year is legally required.
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GST registration cancellation upheld under Section 29(2)(c) for non-filing returns; restoration allowed with dues paid
Case-Laws
GST
The HC upheld the cancellation of the petitioner's GST registration under Section 29(2)(c) of the CGST Act, 2017, due to non-filing of returns for six consecutive months. However, acknowledging the serious civil consequences of such cancellation, the court directed that the petitioner may apply for restoration of registration by submitting all pending returns and paying outstanding tax dues, interest, and late fees in accordance with the proviso to sub-rule (4) of Rule 22 of the CGST Rules, 2017. The empowered officer retains jurisdiction to consider the restoration application and pass appropriate orders within the statutory framework. The petitioner was granted two months to approach the concerned authority for restoration. The writ petition was disposed of on these terms.
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HC refuses to hear petition on SCN issued via Form DRC-01A, directs appeal with first Appellate Authority under Income Tax Act
Case-Laws
GST
The HC declined to adjudicate the petition challenging the SCN issued in Form DRC-01A on jurisdictional grounds related to reliance on Form 26AS under the Income Tax Act, 1961. The court held that the petitioner must pursue remedy before the first Appellate Authority, which is directed to admit the appeal if filed within four weeks, waiving any additional pre-deposit requirements given the petitioner's prior payment of Rs. 7 lakhs. The petition was disposed of accordingly.
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Dredging and De-silting Services Classified as Pure Service with Nil GST Under Entry No. 3 Notification 12/2017
Case-Laws
GST
The AAR held that the applicant's dredging and de-silting services performed using Cutter Suction Dredger in specified river channels for the Government of West Bengal constitute a pure service without any supply of goods. The activity involves excavation and removal of silt without any construction or creation of dumping grounds, thereby excluding it from works contract or composite supply classifications. Consequently, the service satisfies all conditions under Entry No. 3 of Notification No. 12/2017-Central Tax (Rate). The Authority ruled that the supply of dredging and removal of dredged materials falls within the scope of this entry, rendering the applicable GST rate as NIL.
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Appeal Dismissed for Non-Appearance, But Dismissal Set Aside for Lack of Fair Opportunity to Defend
Case-Laws
GST
The HC dismissed the appeal due to the petitioner's non-appearance, attributing it to a refusal to participate. However, the court found that respondent No.2 acted hastily by attempting to dispose of the matter at the initial hearing without affording the petitioner a fair opportunity to present their defense. The HC emphasized the necessity for respondent No.2 and similar officers to provide adequate chances for assessee participation before dismissal. Consequently, the HC set aside the dismissal and remitted the matter to respondent No.2 for fresh consideration, allowing the petition.
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Manpower Supply to WTL is Pure Service, No GST Exemption Under Notification 12/2017 Entry 3
Case-Laws
GST
The AAR held that the applicant's supply of personnel to WTL constitutes a pure service and not a composite supply or works contract. NKDA, constituted under the New Town Kolkata Development Authority Act, 2007, qualifies as a local authority; however, the service recipient is WTL, not NKDA, as payment flows from NKDA to WTL and then to the applicant on a back-to-back basis. Consequently, the applicant does not directly supply services to the local authority. Since all conditions of Entry No. 3 of Notification No. 12/2017-Central Tax (Rate) are not met, the exemption under the said notification is inapplicable. Therefore, the applicant is not entitled to the nil-rated GST exemption and must charge GST in its invoice to WTL for the manpower supply services rendered.
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Single Show Cause Notice for Multiple Years Violates GST Act Sections 2(106), 73, 74, and 128 Rules
Case-Laws
GST
The HC held that issuance of a single show cause notice encompassing multiple financial years contravenes the GST Act, which mandates that show cause notices must correspond to individual tax periods as defined under Section 2(106) and Sections 73/74. The Court emphasized that “bunching” violates principles of natural justice and statutory provisions, as each financial year constitutes a separate tax period. Furthermore, Section 128's provision for waiver schemes cannot justify pre-notification notices aggregating multiple years, as this imposes undue hardship on taxpayers. The Court clarified that show cause notices must be issued either based on annual returns after their filing or on monthly returns if issued prior to annual return submission. Accordingly, the petition challenging the validity of the multi-year show cause notice was allowed, reinforcing strict adherence to the statutory time limitation and procedural safeguards under the GST Act.
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70-Day Delay in Filing Appeal Condoned Under Section 107 of TNGST Act for Medical Reasons
Case-Laws
GST
The HC condoned a 70-day delay in filing an appeal under Section 107 of the TNGST Act against an Adjudication Order dated 07.01.2025, finding the petitioner's reasons-medical treatment of the managing partner and delayed knowledge of the order-genuine. The FORM GST APL-02 dated 23.06.2025 issued by the 1st respondent was quashed, and the appeal was restored on the 1st respondent's file. Restoration was conditional upon the petitioner's payment of Rs. 10,000 to the Principal Government Naturopathy Medical College and Hospital within two weeks of the order. The petition was accordingly disposed of.
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High Court Quashes Penalty for Delayed GSTR-3B Filing Under Section 39, Orders Fresh Adjudication
Case-Laws
GST
The High Court set aside the impugned order which upheld the demand and penalty solely on the ground of delayed filing of GSTR-3B returns for FY 2017-18 to 2020-21 under Section 39 of the GST Act. Without adjudicating on the merits, the matter was remanded to the Superintendent, CGST & Central Excise Range-I, Division Ratlam for fresh adjudication in light of changed circumstances. The petition was disposed of by remand, directing reconsideration of the case afresh.
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Bail Rejected for Tax Fraud Under Sections 132(1)(b), (c), (i) of CGST Act for Fake Invoice Scam
Case-Laws
GST
The DSC rejected the bail application of the accused proprietor of M/S New Global Scrap Traders, charged under Sections 132(1)(b), 132(1)(c), and 132(1)(i) of the CGST Act, 2017, for fraudulent availing and utilization of input tax credit amounting to Rs. 23,47,68,801/- through fake invoices without actual supply of goods. The court found no violation of fundamental rights under Article 22(1) and (2). Given the gravity of the offence, evidence of issuance of bogus invoices, and risk of evidence tampering, witness influence, and flight, the accused was deemed unfit for bail at this stage. The prosecution's case demonstrated substantial material indicating deliberate tax evasion and fraud, justifying continued custodial detention to safeguard the investigation and public interest.
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Section 129 GST Proceedings Require Proof of Mens Rea; Minor Invoice Errors Insufficient for Penalty
Case-Laws
GST
The HC held that initiation of proceedings under section 129 of the GST Act requires proof of mens rea to evade tax. A minor discrepancy of one digit in the tax invoice and e-way bill did not establish such intent. Relying on precedent emphasizing the necessity of mens rea for penalty imposition, the Court found the impugned orders unsustainable. Consequently, the orders were quashed, and the petition was allowed.
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Final Opportunity Ordered for Petitioner to Present Case Before Authority Under Section 30 Deadline Set for Compliance
Case-Laws
GST
The HC set aside the impugned order imposing the penalty, noting that although the petitioner was represented at the personal hearing and lost the right of appeal due to delay, the petitioner must be afforded one final opportunity to present their case before the authority. The petitioner is directed to communicate a certified copy of the HC order to the authority by 30 December 2024; failure to do so will result in automatic restoration of the original order. Upon receipt, the authority shall schedule a hearing to allow the petitioner a last chance to be heard and thereafter pass a fresh adjudicatory order. The petition is disposed of accordingly.
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Non-service of Show Cause Notice and denial of hearing violate natural justice; order set aside under relevant rules
Case-Laws
GST
The HC held that the non-service of the Show Cause Notice (SCN) and denial of personal hearing constituted a violation of natural justice principles. Consequently, the impugned order-in-original demanding recovery for wrongful availment of Input Tax Credit against the Petitioners was set aside. The Court directed the Adjudicating Authority to adjudicate the SCN afresh after considering the Petitioners' reply and submissions. The petition was disposed of accordingly.
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Order set aside for denying personal hearing under Section 75(4) of TNGST Act, remanded for fresh consideration
Case-Laws
GST
The HC held that the impugned order was passed in violation of natural justice principles, as the respondent failed to provide the petitioner a personal hearing despite receiving a detailed 130-page reply. The Court emphasized the mandatory requirement under Section 75(4) of the TNGST Act, 2017, for affording an opportunity of personal hearing before passing such orders. Consequently, the HC set aside the impugned order dated 26.09.2024 and remanded the matter to the respondent for fresh consideration, directing that the petitioner be given a personal hearing to present their case on merits. The petition was allowed by way of remand.
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