LATEST GST CASE LAWS: 11.08.2025
🔥📛 SC: Dismisses Revenue’s SLP against judgment allowing service-recipient under RCM to seek advance- ruling
➡️ Rajasthan High Court held that a recipient of services, liable to pay GST under Reverse Charge Mechanism (RCM), can apply for an advance ruling on tax liability.
➡️ The HC interpreted the legal fiction under Section 9(3) of the CGST Act to treat the RCM-liable recipient as a “supplier” for the purposes of Chapter XVII (Advance Ruling provisions).
➡️ The HC set aside the AAR’s view that only actual suppliers could seek advance rulings, finding this interpretation contrary to the statutory scheme.
➡️ The SC dismissed the Rajasthan Commercial Tax Department’s Special Leave Petition (SLP), finding no reason to interfere with the HC’s ruling.
➡️ While upholding the HC’s decision for the assessee, the SC clarified that the broader legal question raised by the Revenue is kept open for future consideration.
✔️ SC – Commercial Tax Department Vs Power Grid Corporation Of India Ltd & Ors [SPECIAL LEAVE PETITION (CIVIL) Diary No(s). 17421/2025]
🔥📛 HC: Overturns assessment order issued just one day before scheduled personal hearing
➡️ The assessee received a Show Cause Notice for alleged incorrect tax liability in its annual returns for AY 2020-21.
➡️ The Commercial Tax Officer fixed a personal hearing for 11 February 2025, directing the assessee to produce necessary documents.
➡️ The assessment order was passed on 10 February 2025, one day before the scheduled personal hearing.
➡️ The Madras High Court held that passing the order before the hearing date deprived the assessee of the opportunity to be heard, breaching principles of natural justice.
➡️ The Court set aside the assessment order and remanded the matter to the Revenue for fresh adjudication after granting proper hearing.
✔️ Madras HC – Shri Bharathi Weaves vs. Commercial Tax Officer [W.P. No. 26175 of 2025]
🔥📛 HC: Disposes writ challenging vires of Section-16(4)- &-16(2) (c ) basis withdrawal and Section-16(5) insertion
➡️ The Assessee withdrew its writ petition challenging the constitutional validity of Section 16(4), Section 16(2)(c) of the CGST Act, 2017, and Rule 61(5) of the CGST Rules, 2017; the Madras High Court accordingly dismissed the petition.
➡️ A batch of writ petitions also questioned notices and orders that disallowed Input Tax Credit (ITC) based on Section 16(4) and Section 16(2)(c), focusing on statutory time limits and supplier-tax payment conditions.
➡️ The Court took note of the insertion of Section 16(5), which permitted taxpayers to claim ITC for FY 2017-18 to FY 2020-21 in any return filed up to 30 November 2021.
➡️ In light of this legislative relaxation, the High Court disposed of the writ petitions, effectively removing disputes for claims covered by the extended deadline.
➡️ Taxpayers who had missed earlier statutory cut-offs for claiming ITC in the affected years could rely on the Section 16(5) window, subject to filing within the prescribed extended timeline.
✔️ Madras HC – R.K. Enterprises vs Union of India and Others [W.P. Nos. 3457, 3465 & 34753 of 2022]
🔥📛 HC: After GSTIN cancellation, taxpayers aren’t obliged to check GST portal for notices
➡️ The assessee challenged an order under Section 73 of the GST Act, arguing that after its GST registration was cancelled, no business activity was carried out.
➡️ The show cause notice (SCN) was served only by uploading it on the GST portal, without using any alternative means of communication.
➡️ The High Court found this mode of service inadequate, holding that such a practice violates the principles of natural justice when the assessee’s registration is already cancelled.
➡️ The Court relied on the coordinate bench decision in Katyal Industries, which mandates that SCNs must also be served through alternative means to ensure proper communication to the taxpayer.
➡️ The Court set aside the order, granted liberty to the Revenue to issue a fresh notice through proper service channels, and disposed of the writ petition.
✔️ Allahabad HC – Lalaram Thekedar vs. UOI & 2 Ors. [WRIT TAX No. – 2786 of 2025]
🔥📛 Object of pre-deposit cannot be frustrated for Assessee’s financial hardship; Dismisses SLP
➡️ The Supreme Court rejected the assessee’s Special Leave Petition challenging the Gujarat High Court’s refusal to waive or reduce the mandatory pre-deposit for filing an appeal before CESTAT.
➡️ The assessee’s plea for waiver based on inability to pay was held insufficient to invoke the High Court’s writ jurisdiction.
➡️ SC emphasized that Sections 35B and 35F of the Central Excise Act, 1944 mandate pre-deposit for appeals, serving a specific statutory objective that cannot be bypassed.
➡️ The Court reiterated that pre-deposit requirements exist to safeguard revenue interests once liability is determined by the original authority.
➡️ Terming the Gujarat HC judgment as “well-reasoned,” the SC upheld the Rs 10 crore pre-deposit requirement against a demand exceeding Rs 400 crores (plus interest and penalty).
✔️ SC – Altafhusen Mayuddin Khatri vs UOI & Ors [SPECIAL LEAVE PETITION (CIVIL) Diary No.12185/2025]
🔥📛 ITC rightly denied as assessee failed to prove payment to suppliers within 180 days from invoice date with bank proof: HC
➡️ The assessee claimed input tax credit (ITC) on purchases from sundry creditors, but the department alleged that payments to certain creditors remained outstanding beyond the statutory 180-day limit under GST law.
➡️ The assessee argued that payments to all creditors except one were made within 180 days and submitted a chart to support this contention.
➡️ The proper officer held that the assessee failed to substantiate timely payments by providing bank statements or other supporting evidence, thus treating the ITC as irregularly availed.
➡️ The High Court noted that no conclusive proof of payment within 180 days was placed on record even at the writ stage, and that in the absence of supporting documents, the officer’s finding could not be faulted.
➡️ Since the obligation to produce evidence lies on the assessee and no procedural violation was shown, the High Court refused to interfere under Article 226, advising the assessee to pursue the appellate remedy.
✔️ Calcutta HC – Tara Lohia (P.) Ltd. v. Additional Commissioner, CGST & CX [WPA NO. 9655 of 2025]
🔥📛 Limitation period stipulated in section 107(4) is not mandatory but merely directory: HC
➡️ Following S.K. Chakraborty & Sons v. Union of India, the timelines in Section 107(4) are not mandatory; Section 5 of the Limitation Act, 1963 applies unless expressly barred. Delays can be condoned if sufficient cause is shown.
➡️ In this case, no individual intimation of the assessment order was sent via SMS or e-mail; mere uploading in an “Additional Tab” was held insufficient. Without proper service, the limitation period for appeal does not properly commence.
➡️ The assessee filed the appeal approximately 3 months and 20 days beyond the statutory outer limit, but given the lack of proper notice, the delay was condonable.
➡️ Under Sections 73(9) and 75(4) WBGST Act, when both written representation and personal hearing are provided, the hearing must be granted after submission of the representation; conducting a hearing before representation renders the right meaningless.
➡️ Passing an ex parte order without considering the assessee’s written request for a personal hearing, especially where an adverse decision was contemplated, breaches the audi alteram partem principle, rendering the order unsustainable.
✔️ Calcutta HC – Ram Kumar Sinhal v. State of West Bengal [M.A.T. No.53 of 2025]
