LATEST GST CASE LAWS: 03.08.2026
🔥📛 Madras HC examines ‘non-designated’ officer’s jurisdiction over DGGI SCN; Finds prima-facie Notification breach
➡️ The Madras High Court granted an interim stay on the assessment and penalty orders passed by the Additional Commissioner of CGST and Central Excise, finding a prima facie jurisdictional issue.
➡️ The disputed proceedings arose from a show cause notice issued by the Directorate General of GST Intelligence, making Notification No. 2/2022-Central Tax dated March 11, 2022 relevant to the adjudication.
➡️ The assessees argued that the notification assigned adjudication of DGGI-issued notices only to the officers specified in Table 5 and that the impugned orders were not passed by any such authorised officer.
➡️ On examining the documents, the Court observed that the adjudication appeared, at first sight, to have been conducted contrary to the jurisdictional framework prescribed under Notification No. 2/2022.
➡️ The interim stay will continue until the next hearing on September 2, 2026, highlighting that GST orders passed by an officer lacking authority under the applicable notification may be vulnerable to challenge.
✔️ Madras HC – SVJ Holdings vs The Additional Commissioner of GST & Ors [WP Nos. 27357 & 27417 of 2026]
🔥📛 Officer issuing combined TN-Maharashtra order cannot decline waiver jurisdiction for Maharashtra alone, holds Madras HC
➡️ The Madras High Court partly set aside the rejection of the assessee’s Section 128A waiver application relating to its Maharashtra operations, holding that the Proper Officer who had issued a single Section 73 order for both Tamil Nadu and Maharashtra could not later deny jurisdiction for only one part of that order.
➡️ The assessee’s earlier appeal before the Commissioner (Appeals), Mumbai had been rejected for lack of jurisdiction with a direction to approach the Chennai authority; the subsequent waiver application was accepted for Tamil Nadu operations but rejected for Maharashtra solely on jurisdictional grounds.
➡️ The Court noted that the application fell within Section 128A(1)(b) and that the records showed payment of the relevant tax liability before the notified deadline of March 31, 2025, satisfying the basic statutory condition for consideration of waiver of interest and penalty.
➡️ Although the Revenue relied on CBIC Circular No. 238/32/2024-GST to argue that FORM GST SPL-02 must be decided by the Proper Officer responsible for recovery under Section 79, the Court found no provision in Section 128A or the Rules that removed the jurisdiction of the officer who had passed the combined Section 73 order.
➡️ Since the same authority had received and processed the waiver application for the Tamil Nadu portion, there was no legal basis to reject the Maharashtra portion alone; the matter was therefore remanded for fresh consideration of the waiver claim relating to Maharashtra operations.
✔️ Madras HC – INDIAN BANK VS THE ASSISTANT COMMISSIONER CGST AND CENTRAL EXCISE
🔥📛 Madras HC holds principal entity cannot restrain GST proceedings against third-party vendors through writ
➡️ The Madras High Court dismissed VM Food Products Pvt. Ltd.’s writ petition seeking to restrain GST authorities from continuing proceedings against separate village enterprises that processed raw cashew nuts for the petitioner.
➡️ The petitioner explained that it sold raw cashew nuts to the village enterprises for shelling and later repurchased the processed kernels, and argued that the authorities wrongly treated these commercially linked transactions as circular trading.
➡️ The Court held that, although the petitioner played a central role in the business arrangement, the requested relief would improperly prevent GST officers from performing their statutory duties against independently registered entities and was therefore not maintainable.
➡️ The Revenue pointed out that an order had already been passed against the petitioner and that the petitioner could pursue the statutory appellate remedy instead of seeking a broad writ restraining proceedings concerning third parties.
➡️ The dismissal does not prevent the village enterprises from separately challenging registration-cancellation or adjudication orders passed against them, nor does it prevent the petitioner from contesting any order against it through the remedies available under law.
✔️ Madras HC – VM FOOD PRODUCTS PRIVATE LIMITED VS THE ASSISTANT COMMISSIONER STATE TAX AND 3 OTHERS.
🔥📛 HC: Pre-deposit deficiency curable where shortfall paid within condonable period; Restores appeal
➡️ The Bombay High Court set aside the order dismissing the assessee’s appeal for failure to make the full statutory pre-deposit required under Section 107(6)(b) of the CGST Act.
➡️ The assessee had initially deposited less than the required 10% amount due to financial constraints but paid the shortfall of approximately ₹33.18 lakh on April 1, 2025, within the one-month condonable period and before the appellate order was passed.
➡️ Although the Revenue argued that the complete pre-deposit must exist on the date of filing the appeal, it did not dispute that the deficiency had been cured within the permissible period.
➡️ Relying on JEM Exporter v. Union of India, the Court held that procedural deficiencies in an appeal should ordinarily be communicated through a defect memo, giving the appellant a reasonable opportunity to rectify them instead of mechanically rejecting the appeal.
➡️ Since the pre-deposit shortfall had been fully made good before disposal of the appeal, the Court restored the appeal and directed the Commissioner (Appeals) to grant a fresh hearing and decide the matter on merits through a reasoned order.
✔️ Bombay HC – Green Woods vs. Union of India & Anr. [WRIT PETITION NO. 9483 OF 2026]
🔥📛 HC: Future taxes cannot be read into pre-GST tender clauses; Directs reimbursement
➡️ The Bombay High Court held that a contractor executing a public works contract awarded before GST came into force cannot be denied reimbursement of the additional GST burden merely because the tender required quoted rates to include “all applicable taxes.”
➡️ The Court clarified that a tax-inclusive pricing clause covers only taxes applicable on the date of the tender and cannot extend to a new levy introduced later; contractors cannot reasonably factor into their bids taxes that did not then exist.
➡️ The petitioner’s 2014 contract pre-dated GST, and its reimbursement claim was based on the State Government’s circular dated September 19, 2017 and Government Resolution dated January 21, 2021, which provided compensation for additional GST liability on ongoing pre-GST contracts.
➡️ The authority acted arbitrarily by first examining the claim, obtaining verification of the calculations through its Chartered Accountant, and then rejecting the verified claim six months later solely on the basis of the tax-inclusive contract clauses.
➡️ Denying reimbursement to the petitioner while granting the same benefit to similarly placed contractors violated Article 14 by treating equals unequally; the Court therefore quashed the rejection and directed payment of the verified GST reimbursement within eight weeks.
✔️ Bombay HC – Indu Construction Vs Nagpur Improvement Trust & Ors [WRIT PETITION NO. 1867 OF 2023]
🔥📛 GSTAT: GST proceedings impermissible for transitioned credits that were never disputed under pre-GST regime
➡️ The GSTAT Thane Bench allowed Tata Unistore’s appeal and held that proceedings under Section 74 of the CGST Act cannot be used to reassess or recover CENVAT credit or VAT credit carried forward from the pre-GST regime under Section 140 when those credits were never disputed under the earlier laws.
➡️ Reading Sections 140, 142(6)(a) and 174(2)(e) together, the Tribunal clarified that the GST law may restrict the transition of certain credits, but it does not authorise GST officers to examine the correctness of credits originally claimed under the erstwhile statutes; any recovery relating to such credits must be pursued under the relevant pre-GST law.
➡️ The Revenue exceeded its jurisdiction by invoking Section 74 for alleged wrongful availment under the earlier regime, misreading Section 140(1), and reopening undisputed credits without proceedings by the competent authority under the erstwhile law; therefore, action concerning the pre-GST period could not be sustained under the CGST Act.
➡️ The Tribunal upheld transition of Krishi Kalyan Cess credit, relying on Department Circular No. 87/06/2019-GST, which stated that retrospective Explanation 3 to Section 140 could not operate until Explanations 1 and 2 were made effective through notification, and also applied the reasoning in the Godrej & Boyce decision.
➡️ The Tribunal also allowed transition of VAT paid on stock-in-trade, noting that the lower authorities had rejected it without specific findings and had merely grouped it with other disputed credits; objections regarding invoice address, service description, missing invoice copies or credit registers could
✔️ GSTAT Thane Bench – Tata Unistore Limited vs Commissioner CGST & Ex. Navi Mumbai Commissionerate [APL/8/THN/2026]
🔥📛 HC: Slams ‘unmindful’ registration, revocation cancellation despite belated returns filed, son’s murder plea; Imposes cost
➡️ The Patna High Court set aside the cancellation of the assessee’s GST registration because the authorities acted hastily and without considering that the pending returns had already been filed with late fees or that non-filing was caused by exceptional personal circumstances, including the murder of the assessee’s son and the accountant’s illness.
➡️ The Court held that GST authorities must examine the information and documents available on the GST portal before taking adverse action; failure to consider updated returns and the assessee’s explanation demonstrated a lack of proper and judicious application of mind.
➡️ The cancellation and revocation-rejection orders violated Section 75(4) of the GST law and the principles of natural justice because no meaningful opportunity of personal hearing was provided; the Court observed that authorities should ordinarily offer at least three hearing dates before passing such adverse orders.
➡️ The proceedings were also legally defective because the show-cause notice did not contain a Document Identification Number, while the impugned orders failed to disclose the name and designation of the issuing authority, undermining their validity and accountability.
➡️ Although the appellate authority had dismissed the appeal as time-barred, the High Court set aside the appellate order as well, holding that jurisdictional errors affecting the assessee’s livelihood could not be sustained, and imposed litigation costs of ₹15,000 on the GST authorities.
✔️ Patna HC – Munna Chaudhary vs UOI & ors [Civil Writ Jurisdiction Case No. 4593 of 2026]
🔥📛 HC: 10% pre-deposit for penalty-only order inapplicable where SCN predates new proviso to Section 107(6)
➡️ The Delhi High Court held that the applicability of the substituted proviso to Section 107(6) of the CGST Act must be determined with reference to the date on which adjudication proceedings commenced, namely the date of issuance of the show cause notice, and not the date of the Order-in-Original.
➡️ Since the show cause notice under Section 122(1A) was issued on June 25, 2025, before the amended proviso took effect on October 1, 2025, the assessees were not required to deposit 10% of the disputed penalty for filing appeals against the subsequent penalty-only orders.
➡️ The Court found that the Finance Act, 2025 neither expressly nor by necessary implication applied the new pre-deposit requirement to proceedings already initiated, and therefore the appeals continued to be governed by Section 107(6) as it stood on the date of the show cause notice.
➡️ Relying on Hoosein Kasam Dada, Garikapati Veeraya and Videocon International, the Court held that the right of appeal, together with the conditions governing its exercise, vests when the dispute begins; in GST adjudication, the show cause notice marks the commencement of the dispute and forms part of one continuous proceeding through adjudication and appeal.
➡️ The amended proviso was considered more onerous because it introduced, for the first time, a percentage-based pre-deposit for wholly disputed penalty-only orders; although the Appellate Authority cannot waive or reduce a statutory pre-deposit, no question of waiver arose because the new requirement did not apply to these proceedings, thereby avoiding deposits of about ₹34.66 crore against penalties aggregating ₹346.5 crore.
✔️ Delhi HC – Gaurav Jain & Anr. vs Joint Commissioner (Appeals-II) CGST Delhi Zone & anr. [W.P.(C) 8414/2026]
