LATEST GST CASE LAWS: 21.01.2026
🔥📛 HC: 3-months gap mandatory between notice issuance & passing final order u/s 73
➡️ The Bombay High Court held that a mandatory minimum gap of three months must exist between the issuance of notice under Section 73(2) and the passing of the final order under Section 73(10) of the CGST Act.
➡️ The Court emphasized that this three-month period exists to give the noticee a meaningful opportunity to respond, including adherence to natural justice principles.
➡️ If the timeline is shortened, the statutory rights under Section 73(3) and 73(5)—such as receiving a detailed statement of demand and availing the option for voluntary payment—cannot be properly exercised.
➡️ The Court rejected the Revenue’s argument that the three-month period relates only to the outer limit of issuing notices, clarifying that the gap is essential because multiple procedural steps must occur between notice and final order, including providing up to three adjournments for personal hearings.
➡️ Since the notice was issued on 18 November 2024 and the final order was passed on 31 January 2025 (only about 2 months 13 days later), the High Court quashed the order for failing to maintain the statutorily required three-month gap.
✔️ Bombay HC – A. M. Marketplaces Pvt. Ltd vs The Union of India & ors [WRIT PETITION No. 7943 OF 2025]
🔥📛 AAAR: No ITC on factory electrical work as installations/fittings lose movability upon integration with immovable property
➡️ The AAAR upheld the AAR’s view that GST paid on electrical installation works—such as LT panels, bus ducts, lighting systems and associated civil work—forms part of immovable property, thereby blocking ITC under Sections 17(5)(c) and (d).
➡️ AAAR held that once installed, electrical fittings and installations cease to exist as independent movable goods, regardless of their detachable nature. Their purpose is for permanent beneficial use of the factory building, which makes them immovable property.
➡️ AAAR clarified that “Plant and Machinery” must be interpreted as a composite expression, not as separate terms like “plant” or “machinery”. Electrical installations do not qualify as equipment, machinery, or apparatus, as they are meant for multiple general uses rather than a specific functional purpose, and therefore fall outside the definition of Plant and Machinery.
➡️ Relying on principles including the Bharti Airtel ruling, AAAR emphasized that even movable or detachable components may be treated as immovable property if their intention and use is for permanent operational functioning of the facility. Tailor-made electrical elements that lack separate marketability reinforce this classification.
➡️ The AAAR held that the Circular, which allows ITC on ducts/manhole pipes used in telecom networks, is irrelevant because it deals with a different outward supply (telecom services). Hence, it cannot support ITC eligibility for factory electrical installations.
✔️ Tamil Nadu AAAR – In the matter of Shibaura Machine India Private Limited [A.R. Appeal No. 07/2025 AAAR]
🔥📛 HC: Appeal lodged under CBIC’s Amnesty Notification that condones delay, cannot be rejected citing limitation
➡️ CBIC’s 02.11.2023 amnesty notification allowed refiling of appeals earlier rejected for limitation, and once the assessee exercised this option, the appellate authority could not disregard the notification and reject the appeal again on limitation grounds.
➡️ The Court emphasized that the assessee filed the fresh appeal within the amnesty window (up to 31.01.2024)—specifically on 03.01.2024—making it squarely within the permitted period as extended due to the Supreme Court’s COVID-19 limitation orders.
➡️ The appellate authority had dismissed the appeal solely on delay, not because the appeal was defective in form, contrary to the Revenue’s later contention. Hence, the dismissal lacked justification under the amnesty scheme.
➡️ The High Court held that the appellate authority failed to apply its mind to the effect and mandate of the CBIC notification, rendering the rejection order unsustainable.
➡️ Consequently, the Court restored the appeal to the appellate authority’s file, directing reconsideration on merits in line with the amnesty provisions and the extended timelines.
✔️ Calcutta HC – Key Business Consultants Private Limited & Anr. vs Union of India & Ors. [WPA 26981 of 2025]
🔥📛 AAAR: Acer’s IFPD with additional feature of ADP-machine, classifiable as ‘display’ basis end-use; Upholds AAR
➡️ The Tamil Nadu Appellate Authority for Advance Ruling (AAAR) upheld the AAR ruling that classification of Acer’s Interactive Flat Panel Display (IFPD) must be determined by its basic intended or end use, not by the presence of additional technological features.
➡️ AAAR held that IFPDs are correctly classifiable under HSN 85285900 (28% GST) as display units, rejecting classification under HSN 84714190 (ADP machines). The Authority emphasized that mere inclusion of in-built ADP features does not change the product’s essential character.
➡️ AAAR drew a distinction by noting that IFPDs are primarily identified by display-centric specifications such as screen size, resolution, brightness, touch interaction, and viewing angles, whereas ADP machines are defined by CPU, RAM, storage, GPU, and operating systems.
➡️ The ruling clarified that while an IFPD may perform limited ADP-like functions (e.g., presentations, teaching, meetings), it cannot be equated to an ADP machine. Conversely, an ADP machine cannot function as an IFPD, reinforcing the dominance of display functionality in IFPDs.
➡️ AAAR expressly rejected the appellant’s reliance on Circular No. 20/2013-Cus (Tablet Computers), stating that applying it to IFPDs is incorrect and misplaced, as the products differ fundamentally in design, function, and intended use.
✔️ Tamil Nadu AAAR – In the matter of Acer India Private Limited [A.R. Appeal No. 06/2025/A2]
🔥📛 Appeal delay was not condoned as plea of illness of advocate’s wife lacked medical details or supporting evidence : HC
➡️ The assessee filed the appeal on 21-08-2023, exceeding the condonable delay limit under Section 107(4) of the CGST Act, which allows only a one-month extension beyond the initial three-month appeal period.
➡️ Since the delay exceeded the statutory limit, the Commissioner (Appeals) lacked the power to condone it and therefore rightly dismissed the appeal as time-barred.
➡️ The assessee argued that the counsel could not file the appeal due to his wife’s hospitalization, but no documentary evidence or declaration from the counsel was produced to substantiate this claim.
➡️ The assessee did not annex any medical records, hospitalization proof, or details of the ailment even when filing the writ petition, weakening the claim of unavoidable circumstances.
➡️ Given the absence of proof and the statutory bar on condonation beyond the prescribed period, the High Court found no grounds to exercise writ jurisdiction and upheld the rejection of the appeal.
✔️ P&H HC – Shivam Traders v. Proper Officer-sum-Superintendent, Karnal [CWP No. 11742 of 2025 (O & M)]
🔥📛 SCN uploaded on portal not properly communicated; order was without hearing assessee, matter be re-adjudicated: HC
➡️ The adjudication order under Section 73 of the CGST/UPGST Act was challenged on the ground that no show cause notice (SCN) was served on the assessee, and no opportunity was given to file a reply or attend a personal hearing, amounting to a clear breach of principles of natural justice.
➡️ The Court acknowledged systemic issues in online-only service of SCNs and orders through the GSTN portal, including lack of alerts and poor visibility of notices, which often results in assessees being unaware of proceedings initiated against them.
➡️ Given the strict limitation periods and the lack of power with appellate authorities to remand matters, delayed or defective service of adjudication orders can effectively deprive assessees of their statutory right to appeal.
➡️ Even if an appellate authority were to decide the matter on merits, it would still deprive the assessee of the initial opportunity of hearing before the adjudicating authority, which is an essential safeguard under the GST framework.
➡️ Consistent with earlier High Court rulings, the writ petition was allowed without calling for a counter affidavit; the impugned order was set aside, subject to a deposit of 10% of the demand, with directions to issue a fresh SCN and re-adjudicate the matter in accordance with law.
✔️ Allahabad HC – Riya Construction v. State of U.P. [WRIT TAX No. 3964 of 2025]
🔥📛 SCN invoking extended period for fake-entity ITC cannot prima facie extend limitation to other demands: HC
➡️ The show cause notice (SCN) invoked the extended limitation period only for the allegation that the assessee availed irregular ITC based on invoices issued by non-existent entities flagged by alert circulars from Kolkata Commissionerates.
➡️ Since the SCN specifically tied the extended period to fraudulent ITC from non-existent suppliers, the assessee argued that the department cannot extend this longer limitation period to additional heads of demand not linked to that allegation.
➡️ The court observed that the SCN’s explicit reference to extended limitation for fraudulent ITC precludes its application to other unrelated claims included in the notice.
➡️ While the court acknowledged the assessee’s prima facie case, it held that a final view can only be taken after hearing the CGST authorities, ensuring procedural fairness.
➡️ Because most of the demand may not legally fall under the extended period, the court directed that no recovery be made based on the order-in-original until the next hearing.
✔️ Calcutta HC – Silverton Metals (P.) Ltd. v. Joint Commissioner, Central Tax, Haldia CGST & CX Commissionerate [WPA No. 10056 of 2025]
🔥📛 On filing second appeal with 10% pre-deposit, bank attachment after first appeal rejection must be lifted: HC
➡️ The assessee’s initial appeal against the adjudication order was rejected, triggering the department’s recovery powers.
➡️ Following the dismissal, the revenue authorities attached the assessee’s bank account as part of recovery proceedings.
➡️ The assessee expressed readiness to file a further appeal before the GST Appellate Tribunal.
➡️ The court held that if the assessee deposits 10% of the remaining disputed tax (over and above what may already have been paid), the statutory requirement for pre-deposit would be met.
➡️ Upon such deposit, recovery proceedings would be deemed stayed, and the provisional attachment of the bank account must be lifted immediately, enabling the assessee to pursue the appeal before the Tribunal.
✔️ Calcutta HC – S. S. Civil Construction (P.) Ltd. v. Assistant Commissioner of Revenue, State Tax, Ultadanga, Cossipore, Belgachia Charge [WPA No. 27535 of 2025]
