Goods and Services Tax

Case-Laws – GST – Highlights – Blocking of a supplier's credit ledger by mentioning 'Registration of supplier has been cancelled' without issuing a show cause notice violates principles of natural justice. Section 74 statutorily recognizes and mandates adherence to natural justice principles, while Rule 86A is silent on this aspect. Implementing Rule 86A without following natural justice may cause hardship and injustice, contrary to the lawmakers' intent. The Calcutta High Court's judgment in Basanta Kumar Shaw did not address whether natural justice principles apply to Rule 86A. Input Tax Credit is a concession, not a vested right, but natural justice principles must be read into Rule 86A. Blocking the petitioners' electronic credit ledger without following natural justice and assigning adequate reasons cannot sustain judicial scrutiny. The impugned action is set aside, and the petition is allowed. – TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts Tax Management India – taxmanagementindia – taxmanagement – taxmanagementindia.com – TMI – TaxTMI – TMITax

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Case-Laws – GST – Highlights – ITC availed in excess of credit reflected in GSTR-2A, mismatch between GSTR-3B and GSTR-2A, ITC not reversed based on GSTR-2A debit, non-generation of e-way bill. Petitioner seeks opportunity to explain discrepancies, invoking principles of natural justice. High Court set aside impugned order, directed petitioner to deposit 25% of disputed tax after adjusting Rs. 1,00,000 already paid within 4 weeks to lift bank attachment. Impugned assessment order treated as show cause notice, petitioner to file objections with supporting documents within 4 weeks. Respondent to consider objections after providing reasonable opportunity of hearing and pass orders in accordance with law. Writ Petition disposed of. – TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts Tax Management India – taxmanagementindia – taxmanagement – taxmanagementindia.com – TMI – TaxTMI – TMITax

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Case-Laws – GST – Highlights – Impugned proceedings challenged for exceeding scope of show cause notice, non-consideration of submissions during investigation and payments made, gross non-application of mind to material facts, and violation of natural justice principles. Impugned order set aside, petitioner directed to deposit 25% of disputed tax within two weeks, tax already paid adjusted towards deposit. Impugned assessment order treated as show cause notice, petitioner to submit objections with supporting documents within four weeks. Petition disposed of. – TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts Tax Management India – taxmanagementindia – taxmanagement – taxmanagementindia.com – TMI – TaxTMI – TMITax

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Case-Laws – GST – Highlights – Impugned order set aside due to violation of principles of natural justice. Input Tax Credit disallowed without considering petitioner's objection. Petitioner granted final opportunity to appear before respondent authorities with supporting materials on specified date and time to present case. If opportunity not availed, impugned order revived. Petition disposed. – TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts Tax Management India – taxmanagementindia – taxmanagement – taxmanagementindia.com – TMI – TaxTMI – TMITax

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Case-Laws – GST – Highlights – The High Court quashed the orders dismissing the appeal filed by the petitioner firm on grounds of limitation and the order passed u/s 73(9) of the Central Goods and Services Tax Act, 2017. The managing partner of the petitioner firm was critically ill with cancer from March to August 2022, and the firm had uploaded returns for March, April, and May 2022. However, the respondent department failed to grant an opportunity of hearing before passing the impugned order dated 04.04.2022, violating the principles of natural justice u/s 75(4) of the CGST Act. The Court held that despite the firm's inability to reply to the notice due to the managing partner's illness, one fair chance should have been given to comply with natural justice. Consequently, the matter was remanded back to the respondent to decide the show-cause notice after granting an opportunity of hearing to the petitioner. – TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts Tax Management India – taxmanagementindia – taxmanagement – taxmanagementindia.com – TMI – TaxTMI – TMITax

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Case-Laws – GST – Highlights – Fly Ash Blocks are classifiable under Entry No. 225B of Schedule-I, attracting a GST rate of 5%, as per the clarification issued by Circular No. 179/11/2022-GST dated 03.08.2022. The condition of 90% or more fly ash content applies only to Fly Ash Aggregate and not to Fly Ash Bricks or Fly Ash Blocks. Consequently, the orders passed by the Advance Ruling Authority and the Appellate Authority are set aside, and the petition is allowed. – TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts Tax Management India – taxmanagementindia – taxmanagement – taxmanagementindia.com – TMI – TaxTMI – TMITax

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Case-Laws – GST – Highlights – Order of cancellation of registration passed by Assessing Officer upheld by dismissing appeal on limitation ground challenged for not providing opportunity of hearing and without assigning reasons for cancellation, violating principles of natural justice. Court quashed orders and remanded matter to Assessing Officer at show cause notice stage, directing registration to remain suspended till disposal, citing guidelines to avoid procedural lapses leading to writ petitions before High Court. Court emphasized authorities should follow procedure scrupulously to avoid unnecessary litigation. – TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts Tax Management India – taxmanagementindia – taxmanagement – taxmanagementindia.com – TMI – TaxTMI – TMITax

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Case-Laws – GST – Highlights – Entry No. 10 of Notification No. 10/2017- Integrated Tax (Rate) dated 28.6.2017 was challenged as ultra-vires the IGST Act and Articles 14 and 265 of the Constitution, even for imports on FOB basis. The court held that IGST u/s 5(1) is leviable on the value determined u/s 3 of the Customs Tariff Act, 1975, at the point when customs duties are levied u/s 12 of the Customs Act, 1962. The value includes cost, freight, and insurance at the place of importation. Therefore, whether the transaction is CIF or FOB, IGST is payable on the value, including freight, cost, and insurance. However, following Supreme Court and Bombay High Court judgments, when the notification itself is struck down, IGST cannot be insisted upon for ocean freight in FOB transactions. Consequently, the impugned order was quashed, and the petition was allowed. – TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts Tax Management India – taxmanagementindia – taxmanagement – taxmanagementindia.com – TMI – TaxTMI – TMITax

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Case-Laws – GST – Highlights – The High Court held that the revenue authorities committed grave illegality by not granting pre-decisional hearing to the appellants before blocking their Electronic Credit Ledger u/r 86A of CGST Rules, violating principles of natural justice. The Court observed that although Rule 86A doesn't expressly provide for pre-decisional hearing, it has to be read into the provision when serious civil consequences arise. The authorities passed orders solely based on communication from another officer without independently analyzing if Input Tax Credit was on account of fake invoices, which is impermissible. The orders lacked valid material constituting 'reasons to believe' and were passed on borrowed satisfaction, rendering them bald, vague, and unreasoned. Quashing the impugned orders, the Court allowed the appeals, holding that the mandatory requirements for invoking Rule 86A were not fulfilled by the revenue authorities. – TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts Tax Management India – taxmanagementindia – taxmanagement – taxmanagementindia.com – TMI – TaxTMI – TMITax

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Notifications – GST – Highlights – The notification seeks to amend Notification No. 10/2017-Integrated Tax (Rate) under the IGST Act to include service by way of renting any property other than residential dwelling by an unregistered person to a registered person under reverse charge mechanism. This amendment will come into force from 10th October, 2024. The notification inserts a new serial number 6AB in the table of the principal notification to bring this service under reverse charge for IGST. – TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts Tax Management India – taxmanagementindia – taxmanagement – taxmanagementindia.com – TMI – TaxTMI – TMITax

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Notifications – GST – Highlights – This notification amends the Notification No. 13/2017-Central Tax (Rate) to bring the service of renting any property other than residential dwellings under the reverse charge mechanism (RCM) for Goods and Services Tax (GST). Any registered person receiving such rental services from an unregistered person will be liable to pay GST under RCM. The amendment comes into effect from 10th October 2024. – TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts Tax Management India – taxmanagementindia – taxmanagement – taxmanagementindia.com – TMI – TaxTMI – TMITax

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Notifications – GST – Highlights – This notification seeks to amend the Integrated Goods and Services Tax (IGST) rate notification to exempt certain services from IGST. It inserts new entries exempting import of services by an airline company's Indian establishment from its related entities abroad without consideration, subject to conditions. Services incidental to electricity transmission/distribution by utilities are exempted. Research and development services funded by grants from government/notified entities are exempted. Services of affiliation provided by educational boards to government schools are exempted. It modifies entries related to vocational skill development services by recognized bodies to align with the National Council for Vocational Education and Training. The notification comes into force from 10th October 2024. – TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts Tax Management India – taxmanagementindia – taxmanagement – taxmanagementindia.com – TMI – TaxTMI – TMITax

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Notifications – GST – Highlights – This notification seeks to amend Notification No. 12/2017-Central Tax (Rate) to exempt certain services from Goods and Services Tax (GST). The key amendments are: exempting services related to providing metering equipment, testing, releasing electricity connections, shifting meters, issuing duplicate bills by electricity transmission and distribution utilities; exempting research and development services funded by government entities or notified research associations; exempting affiliation services provided by educational boards to government-owned schools; expanding exemption for skill development services to include those provided by accredited training bodies; and substituting references to the National Council for Vocational Training with the National Council for Vocational Education and Training. The notification aims to provide GST exemptions for specific services in the public interest. – TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts Tax Management India – taxmanagementindia – taxmanagement – taxmanagementindia.com – TMI – TaxTMI – TMITax

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Notifications – GST – Highlights – The notification amends serial number 8 of the Integrated Goods and Services Tax (IGST) rate notification. It inserts a new item (ivb) under column (3) for “Transportation of passengers, with or without accompanied baggage, by air, in a helicopter on seat share basis” with a rate of 5% under column (4). However, input tax credit on goods used for providing this service cannot be availed as per the condition in column (5). The amendment also inserts a reference to the new item (ivb) in column (3) of item (vii). The notification comes into force from October 10, 2024. – TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts Tax Management India – taxmanagementindia – taxmanagement – taxmanagementindia.com – TMI – TaxTMI – TMITax

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Notifications – GST – Highlights – This notification amends Serial No. 8 of Notification No. 11/2017-Central Tax (Rate). It inserts a new item (ivb) under Serial No. 8, levying 2.5% CGST on “Transportation of passengers, with or without accompanied baggage, by air, in a helicopter on seat share basis”, with the condition that input tax credit on goods used for supplying this service is not availed. Item (vii) under Serial No. 8 is also amended to include reference to the newly inserted item (ivb). The amendment comes into force from 10th October 2024. – TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts Tax Management India – taxmanagementindia – taxmanagement – taxmanagementindia.com – TMI – TaxTMI – TMITax

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Notifications – GST – Highlights – This notification to introduce reverse charge mechanism (RCM) on supplies of metal scrap under specified tariff headings. Any registered person procuring metal scrap from unregistered suppliers will be liable to pay GST under reverse charge. The amendment inserts a new entry in the notification specifying tariff headings 72 to 81 covering metal scrap, with recipient registered person liable to pay tax on supplies from unregistered person. The notification comes into force on 10th October 2024 and amends an earlier notification from 2017. – TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts Tax Management India – taxmanagementindia – taxmanagement – taxmanagementindia.com – TMI – TaxTMI – TMITax

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Notifications – GST – Highlights – This notification amends the CGST Rate Schedule u/s 9(1) of the Central Goods and Services Tax Act, 2017. It inserts three new items (Trastuzumab Deruxtecan, Osimertinib, Durvalumab) under the 2.5% tax rate schedule. It adds extruded or expanded savoury/salted products under the 6% tax rate. It modifies the 9% rate schedule by substituting the entry for un-fried/un-cooked snack pellets and seats other than aircraft/motor vehicle seats. It inserts a new entry for seats of motor vehicles under the 14% tax rate. The notification comes into force on 10th October 2024. – TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts Tax Management India – taxmanagementindia – taxmanagement – taxmanagementindia.com – TMI – TaxTMI – TMITax

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Notifications – GST – Highlights – This notification supersedes an earlier notification No. 22/2021-Central Tax, except for actions taken before supersession. It waives the late fee payable u/s 47 of the Central Goods and Services Tax Act, 2017 by registered persons required to deduct tax at source u/s 51, for failure to file FORM GSTR-7 from June 2021 onwards. The late fee exceeding Rs. 25 per day of delay is waived, subject to a maximum of Rs. 1000. If no tax was deducted in a month, the entire late fee is waived. The notification comes into force on November 1, 2024. – TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts Tax Management India – taxmanagementindia – taxmanagement – taxmanagementindia.com – TMI – TaxTMI – TMITax

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Notifications – GST – Highlights – Central Government notifies special procedure for rectification of orders issued u/ss 73, 74, 107, 108 confirming demand for wrong availment of input tax credit. Registered persons against whom such orders have been issued can file application electronically within six months for rectification if input tax credit is now available u/s 16(5) or 16(6), provided no appeal is pending. Application to include details of demand confirmed and eligible credit. Proper officer to decide on application and issue rectified order within three months. Rectification allowed only for credit wrongly denied u/s 16(4) but now admissible under 16(5) or 16(6). Principles of natural justice to be followed if rectification adversely affects the person. Prescribed proforma for filing application with declaration and verification. – TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts Tax Management India – taxmanagementindia – taxmanagement – taxmanagementindia.com – TMI – TaxTMI – TMITax

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Notifications – GST – Highlights – This notification specifies the respective dates by which registered persons must make payment for tax payable as per notice, statement or order to qualify for waiver of interest and penalties u/s 128A of the CGST Act. For registered persons issued notice/statement/order u/s 128A clauses (a), (b) or (c), the date is 31.03.2025. For those issued notice u/s 74(1) and order passed by proper officer redetermining tax u/s 73 pursuant to appellate authority/tribunal/court direction, the date ends six months from issuance of such order. The notification is effective from 01.11.2024. – TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts Tax Management India – taxmanagementindia – taxmanagement – taxmanagementindia.com – TMI – TaxTMI – TMITax

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Goods and Services Tax – GST Dated:- 9-10-2024 – News – Union Minister of State for Finance Shri Pankaj Chaudhary inaugurates GST Bhawan at Nangal Raya, Janakpuri, Delhi Dated:- 9-10-2024 – Shri Chaudhary asks CBIC to showcase how the Government is helping taxpayers by simplifying tax compliance CBIC s large-scale expansion in office and residential infrastructure reflects growth of the department over the years: CBIC Chairman Union Minister of State for Finance Shri Pankaj Chaudhary inaugurated the state-of-the-art Goods and Services Tax (GST) office building in Nangal Raya, Delhi. Representing a significant milestone in the government s commitment to improve tax administration and enhance public service, this new facility will serve as

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lified the indirect tax framework and broadened the tax base; on the other, it highlighted the urgent need to enhance the operational capacity of central GST structures. Shri Chaudhary further elaborated that as a significant contributor to the national exchequer, the effectiveness of GST in Delhi has a direct impact on overall tax revenue and the economic vitality of the country and advised officers to specially ensure in their interactions with MSMEs, that they not only remind them of their obligations but also showcase how the Government is helping them by simplifying tax compliance. The Union Minister of State also advised officers to use simple clear communication with the taxpayers. While delineating the modern and advanced facilities

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years. In the last 10 financial years (2014-24), approvals have been received for infrastructure projects costing over ₹4,000 crore. Not only have approvals been secured, but the pace of construction on the ground has been unprecedented. He mentioned projects such as NACIN Palasamduram; Office and residential complex at Wadala, Mumbai, and Hyderabad. Shri Aggarwal said that all projects are being closely monitored by the CBIC. While discussing the GST Bhawan at Nangal Raya, Shri Aggarwal emphasised that with its advanced facilities, including air-conditioned offices, modern workspaces and 24×7 security arrangements, it will streamline the work of our officers while offering greater convenience to taxpayers. One of the building's k

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Case-Laws – GST – Highlights – Writ petition challenging adjudication order for recovery of inadmissible income tax return with interest and penalty. Court found non-application of mind and violation of principles of natural justice in the adjudication order as it failed to consider relevant documents. Writ petition dismissed solely on grounds of availability of alternate remedy, without examining merits. Court held preliminary ground raised by assessee in challenging adjudication order would not involve adjudication into facts, and writ court can examine effect of earlier order and subsequent proceedings on same set of facts. Writ petition restored for fresh hearing after affidavit-in-opposition filed by Department. Appeal allowed. – TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts Tax Management India – taxmanagementindia – taxmanagement – taxmanagementindia.com – TMI – TaxTMI – TMITax

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Case-Laws – GST – Highlights – The High Court quashed the order invoking Rule 86A for blocking the Electronic Credit Ledger (ECL) of the petitioner under the CGST/SGST Rules, 2017. The impugned order lacked independent or cogent reasons and relied on reports of enforcement authorities, which is impermissible. Crucially, no pre-decisional hearing was granted, violating principles of natural justice. The order erroneously described the supplier as non-existent or not conducting business, despite the supplier obtaining registration and the transaction occurring before cancellation of registration. The court held that the order failed to provide valid reasons for blocking the ECL, thereby warranting its quashing. – TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts Tax Management India – taxmanagementindia – taxmanagement – taxmanagementindia.com – TMI – TaxTMI – TMITax

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Case-Laws – GST – Highlights – The High Court held that the value of free diesel supplied by the service recipient to the Goods Transport Agency (GTA) service provider cannot be included in the taxable value for calculating GST. This is based on Supreme Court judgments which consistently ruled that where the service recipient provides free supplies like diesel or explosives, their value cannot be added to the consideration paid to the service provider for determining service tax/GST liability. The cost of free supplies borne by the recipient is not part of the “gross amount charged” by the service provider. Therefore, as per the agreement where the service recipient bore the fuel cost, this free diesel value cannot be added to the taxable GTA service value u/ss 15(1) and 15(2)(b) of the CGST Act for GST calculation. The High Court set aside the Advance Ruling order which had held otherwise. – TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts Tax Management India – taxmanagementindia – taxmanagement – taxmanagementindia.com – TMI – TaxTMI – TMITax

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Case-Laws – GST – Highlights – The High Court addressed the issue of refund of unutilized Input Tax Credit where remittances were received in a different branch's bank account. The Court held that establishments should be treated as distinct persons under the CGST Act, even if they are part of the same entity. The petitioner had initially not provided bank account details for its Delhi branch but later updated them, including a Bangalore bank account where remittances were credited. The Court observed that these remittances were clearly connected to services rendered by the Delhi branch, and the objection raised was overly technical and unsustainable. The Court clarified that the CGST Act contemplates entities having multiple establishments across states, and Section 25(4) and (5) override the principle of branch offices not being separate juridical entities. Consequently, the High Court quashed the impugned orders and allowed the petition. – TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts Tax Management India – taxmanagementindia – taxmanagement – taxmanagementindia.com – TMI – TaxTMI – TMITax

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