LATEST GST CASE LAWS: 04.11.2026
🔥📛 Madras HC grants physically challenged consumer refund of excess GST paid on vehicle purchase; Rejects dealer only objection
➡️ The Madras High Court allowed a writ petition by a physically challenged person seeking refund of excess GST paid at 28% on the purchase of an eligible motor vehicle (a Ford EcoSport 1.5 petrol car) instead of the concessional 18% under Entry No. 400 of Schedule III to Notification No. 1/2017-Central Tax (Rate), together with refund of the entire compensation cess paid on the vehicle.
➡️ The petitioner bought the vehicle from Eureka Ford for about ₹9.99 lakh, including CGST and SGST at 14% each and compensation cess, and the refund claim was rejected by the Additional Commissioner. The certificate from the Director, Department of Heavy Industries, confirming that the vehicle was capable of use by physically challenged persons, was obtained after the date of purchase, and the invoice and affidavit prescribed under the Notification had not been produced before the authorities.
➡️ In an earlier order the Court had held that subsequent procurement of the certificate would not by itself disentitle the petitioner, subject to the Revenue establishing that the dealer had passed on tax at 28%, and had directed verification. The Revenue then contended that the petitioner, having failed to avail the concession at the time of purchase, could not seek a belated refund, and that any refund could be granted only to Eureka Ford, which had remitted the tax.
➡️ Rejecting these contentions, the Court held that the petitioner’s entitlement to the concessional rate and cess exemption is covered by the Notification, that the Revenue had neither disputed eligibility nor alleged non-compliance with its conditions, and that the Notification does not restrict the concession to being availed at the time of purchase. The expression ‘any person’ in Section 54 is wide enough to cover the consumer who actually bore the tax, and the proviso to Section 54(1) itself distinguishes refund claims by registered and unregistered persons, negating the dealer-only argument.
➡️ Noting that the petitioner, as the ultimate consumer, had lodged the claim within two years of purchase, the Court directed the petitioner to file an application in Form GST RFD-01 and the authority to process and grant the admissible refund. The ruling confirms that an unregistered end consumer who has borne excess tax can claim refund directly under Section 54, and that a concession missed at the invoicing stage is not lost.
✔️ Madras HC – A. ARUL LEONET INDEPEN VS. THE PRINCIPAL CHIEF COMMISSIONER OF GST AND CENTRAL EXCISE & ORS.
🔥📛 SC: Declines interference with HC ruling that appeals involving exemption notification applicability lie before Supreme Court
➡️ The Supreme Court disposed of the Revenue’s Special Leave Petition and declined to interfere with the Madras High Court’s order closing the Revenue’s appeal against the CESTAT ruling in favour of PepsiCo India Holdings, which had allowed refund claims of ₹5.42 crore towards 4% Special Additional Duty (SAD) on imported oats.
➡️ The dispute arose from 34 refund claims under Notification No. 102/2007-Customs, which the Revenue rejected on the ground that the imported oats had undergone further processing through job workers before sale, allegedly in breach of the Notification’s conditions, resulting in a demand of ₹5.42 crore and a penalty of ₹25 lakh.
➡️ CESTAT found the assessee eligible for the exemption, set aside the orders and allowed the refunds. When the Revenue appealed to the Madras High Court, the Court accepted the assessee’s preliminary objection on maintainability, holding that the applicability of the exemption notification had a direct and proximate bearing on the rate of customs duty.
➡️ The Supreme Court held that the High Court committed no error in concluding that a challenge to a CESTAT order concerning the applicability of an exemption notification lies before the Supreme Court under Section 130E(b) of the Customs Act and not before the High Court under Section 130.
➡️ The Court left it open to the Revenue to prefer a statutory appeal under Section 130E and disposed of the SLP. The ruling reaffirms the forum rule that disputes on the applicability of exemption notifications affecting the rate of duty go directly to the Supreme Court, and parties must file in the correct forum to avoid losing time on limitation.
✔️ SC – Commissioner Of Customs vs Pepsico India Holding Pvt Ltd. [SPECIAL LEAVE PETITION (CIVIL) Diary No. 40314/2026]
🔥📛 Madras HC extends interim stay of demand recovery on restaurant services basis declared room tariff
➡️ The Madras High Court extended the interim stay on recovery proceedings relating to GST demands on restaurant services in hotels that were determined with reference to the declared room tariff, continuing the protection granted earlier pending further orders of the Division Bench in the connected batch of matters.
➡️ The challenge concerns the notifications prescribing the GST rate on restaurant services in hotels by reference to the declared tariff of hotel accommodation. Prior to April 1, 2025, premises providing accommodation with a declared tariff exceeding ₹7,500 per unit per day were treated as ‘specified premises’, attracting the higher rate on restaurant services.
➡️ This framework was introduced through Notification No. 20/2019-Central Tax (Rate) dated September 30, 2019, with effect from October 1, 2019, and formed the basis of the demands raised on the petitioner hotel for the periods in dispute.
➡️ Pursuant to the recommendations of the 55th GST Council meeting, Notification No. 05/2025-Central Tax (Rate) dated January 16, 2025 amended the rate notification with effect from April 1, 2025 by omitting the definition of declared tariff, moving away from the declared-tariff basis for the period thereafter.
➡️ The Court listed the matter for further hearing on November 30, 2026. Hotels facing demands for pre-April 2025 periods computed on the declared-tariff basis may seek similar interim protection, and the outcome of the batch will decide the validity of that basis for the earlier period.
✔️ Madras HC – Hudson Hotels Versus Union of India & Ors. [WP No. 16592 of 2026]
🔥📛 Madras HC grants interim stay against SCN reopening settled classification of Interactive Flat Panels
➡️ The Madras High Court granted an interim stay to BenQ India in its challenge to a Show Cause Notice on the classification of Interactive Flat Panels, holding that a prima facie case was made out and that the balance of convenience lay in favour of the assessee.
➡️ The assessee submitted that the classification issue had already attained finality before the Supreme Court, and that the Revenue was refusing to follow the law laid down by the Supreme Court merely on the ground that a Review Petition had been filed.
➡️ The assessee further contended that the Revenue had not complied with Circular No. 12/2025-Customs dated April 7, 2025 on the classification of such panels, and that the SCN was therefore unsustainable.
➡️ Considering the facts and submissions, the Court ordered an interim stay until further orders, issued notice to the Revenue and listed the matter on December 14, 2026.
➡️ The order signals that a pending review petition does not suspend the binding effect of a Supreme Court ruling, and that notices seeking to reopen a settled classification contrary to that ruling and the Board’s own circular are liable to be stayed.
✔️ Madras HC – BenQ India Private Limited Versus The Joint Commissioner of GST and Central Excise, Chennai Outer Commissionerate [WP No. 43004 of 2026]
🔥📛 GSTAT: Expedia-India’s support services to overseas affiliates qualify as exports; Allows Rs 55.99 cr. refund
➡️ The GSTAT Principal Bench allowed seven appeals filed by Expedia India and set aside orders rejecting refund claims aggregating ₹55.99 crore of unutilised ITC on export of services for FY 2019-20 to FY 2022-23, holding that business support and contract software development services rendered to overseas group entities under independent agreements on a cost-plus-markup basis are not ‘intermediary services’ under Section 2(13) of the IGST Act but ‘export of services’ under Section 2(6), entitling the assessee to refund with interest under Section 56.
➡️ Rejecting the Revenue’s objection to the Principal Bench’s jurisdiction, the Tribunal held that deciding whether the supply was made in India or outside, and whether the supplier is an intermediary, necessarily involves the question of place of supply, so the matter properly lay before the Principal Bench.
➡️ The Tribunal emphasised that an intermediary arrangement requires at least three parties and two distinct supplies, a principal supply between two parties and an ancillary supply facilitating it, and that a person supplying services on a principal-to-principal basis on its own account cannot be treated as an intermediary merely because the services facilitate the overseas recipient’s business. Applying Navitas Eduservices, Dow Chemical International and the Delhi High Court’s ruling in Fateh Education Consulting, it held that ‘any other person’ in Section 2(13) must be read ejusdem generis with broker and agent, and Expedia India had no authority to bind its parent.
➡️ The Tribunal noted that the DGGI had itself concluded proceedings recognising certain services of the assessee as exports, which supported its conclusion, while clarifying that neither the CBIC circular nor the DGGI report binds the Tribunal’s adjudicatory powers.
➡️ In respect of one claim rejected for BRC/FIRC mismatch, non-reflection of invoices in GSTR-2A and absence of business nexus, the Tribunal held the rejection unsustainable because the SCN did not specify the alleged discrepancies and the appellate authority recorded no reasoned findings, travelling beyond the notice. All orders were set aside and the Revenue was directed to refund the unutilised ITC with statutory interest, a significant precedent for captive service centres and global capability centres serving overseas affiliates.
✔️ GSTAT Principal Bench, Delhi – Expedia Online Travel Services India Pvt. Ltd. v. Commissioner of Central GST, Haryana [APPEAL NOS. APL/15/PB/2026, APL/16/PB/2026, APL/17/PB/2026]
🔥📛 HC: Dismisses Advocate’s PIL challenging 18% GST on online legal research services
➡️ The Allahabad High Court dismissed a Public Interest Litigation filed by an advocate challenging the 2017 notifications prescribing 18% GST on online legal research and legal educational database services, classified under SAC 998431 of Group 99843 under Heading 9984, without any separate classification or concessional rate.
➡️ The petitioner argued that such research tools are essential for lawyers to verify the authenticity and precedential validity of judgments before citing them, since reliance on an overruled or fake judgment could amount to professional misconduct, and that the services therefore cannot be treated as a luxury warranting 18% GST.
➡️ The Court questioned the unexplained delay in the challenge, noting that the rate has been in force since 2017, that the petitioner was enrolled as an advocate only in 2020 and claims to have practised for six years, and that the petition nowhere indicated what had suddenly caused the petitioner to become aware of the alleged unreasonableness of the rate.
➡️ Holding that such sudden awareness and the filing of a PIL at the instance of this petitioner could not be countenanced, the Court dismissed the petition without examining the merits of the rate.
➡️ The rate flows from Entry No. 22 of Notification No. 11/2017-Central Tax (Rate) dated June 28, 2017, which prescribes 9% CGST on telecommunications, broadcasting and information supply services under Chapter 9984, with 9% SGST under the corresponding State notification, and Entry No. 22 of Notification No. 8/2017-Integrated Tax (Rate) prescribing 18% IGST. Challenges to GST rates through PIL face hurdles of delay and locus, as rate fixation remains the domain of the GST Council.
✔️ Allahabad HC – Aniket Gupta vs Union of India and 4 others [PUBLIC INTEREST LITIGATION (PIL) No. – 2544 of 2026]
🔥📛 GSTAT: Refund limitation reckoned from original application, not from refiling after deficiency memo
➡️ GSTAT Delhi dismissed the Revenue’s appeal against the First Appellate Authority’s order annulling the rejection of the assessee’s refund application on the ground of limitation. Although the Tribunal found that the appellate order, resting solely on violation of natural justice without any finding on limitation, was not a reasoned order as required by Sections 107(11) and (12), it substituted its own comprehensive reasons on the relevant date and upheld the result.
➡️ The assessee sought refund of excess tax paid on an advance for April 2020, part of which did not materialise into supply. It filed its first refund application on February 29, 2024, followed by second and third applications on March 31, 2024 and May 25, 2024 after deficiency memos. The original authority reckoned limitation from the third application after applying the COVID-19 exclusion under Notification No. 13/2022-Central Tax and rejected the claim as time-barred.
➡️ The Tribunal held that the relevant date was May 19, 2020, when the tax was discharged through GSTR-3B, and that where the relevant date falls within the excluded period of March 1, 2020 to February 28, 2022, the limitation period must be reckoned afresh from March 1, 2022 in terms of the Supreme Court’s order in In Re: Cognizance for Extension of Limitation, not by merely adding the overlapping days to the original due date. On that basis the first application was filed on the last day of the extended period and was within time.
➡️ Accepting the assessee’s contention that limitation is tested against the original application and not the refiling after a deficiency memo, the Tribunal held that the second and third applications relate back to and continue the original timely application, and that deficiency memos have no independent bearing on limitation. The doctrine of relation-back cures the effect of an intervening deficiency memo on an otherwise timely claim, but cannot cure an original claim that was itself time-barred.
➡️ The Tribunal rejected the assessee’s alternative plea that the unadjusted advance was a deposit paid under mistake of law outside Section 54, holding that GST was lawfully payable on the advance when received and that the two-year limit under Section 54(1) is a substantive condition which cannot be overridden by Circular No. 37/11/2018-GST, which addresses only minor procedural lapses. Taxpayers should file the first refund application within time and treat refilings after deficiency memos as continuations, not fresh claims.
✔️ GSTAT Delhi – Laldeo Rajak Vs Kaneka India Private Limited [APL/72/DEL/2026]
🔥📛 GSTAT: Deletion of penalty imposed u/s 122 invalid post-taxpayer’s admission regarding fake invoices; Allows Revenue’s appeal
➡️ GSTAT Bengaluru allowed the Revenue’s appeal in an alleged fake invoice case, holding that the Commissioner (Appeals) had wrongly deleted the penalties imposed under Sections 122(1)(vii) and 122(1)(x) of the CGST Act, and restored them.
➡️ The case arose from a drive against a fake invoice racket in which the Revenue intercepted and seized a truck carrying 18,200 kg of arecanut without valid documents. The Additional Commissioner imposed the penalties, but the Commissioner (Appeals) set them aside, reasoning that the penalty under Section 122(1)(x) had been levied without specifying the nature of the offence.
➡️ The Tribunal held that reasoning to be incorrect, noting that no order under Section 74 was passed against the taxpayer in view of the Board’s circular, and that Section 122(1)(x) applies where a taxpayer falsifies or substitutes financial records, produces fake accounts or documents, or furnishes false information or returns with intent to evade tax.
➡️ The record showed contradictory statements: the taxpayer first denied any connection with Shrinivasa Traders and later admitted being its proprietor, first claimed cash purchases from farmers and later from traders, and admitted issuing and receiving bills without supply of goods without retracting the statement at the earliest opportunity. Invoices were dated after cancellation of the supplier’s and recipient’s registrations, vehicle numbers on invoices and e-way bills belonged to tankers, three-wheelers and delivery vans or showed ‘vehicle detail not found’ on the vaahan portal, and the taxpayer could not explain why a third person generated his e-way bills and invoices.
➡️ Emphasising that the burden is on the taxpayer to prove receipt of goods under Section 16(2)(b) and payment of tax by the supplier under Section 16(2)(c), the Tribunal found neither proved and no documents furnished to establish the genuineness of the dealings. The impugned order was set aside and the penalties restored, confirming that unretracted admissions and documentary inconsistencies suffice to sustain penalties under Section 122 even without a Section 74 demand against the taxpayer.
✔️ GSTAT Bengaluru – Shekhar Basappa Wali vs Shrinivasa Traders [APL/255/BUR/2026]
🔥📛 HC: Directs proper officer to independently re-examine ITC denial u/s 16(2)(c) on supplier’s default upon remand
➡️ The Allahabad High Court disposed of a writ petition by directing the proper officer to independently re-examine the assessee’s ITC claim, which had been denied under Section 16(2)(c) of the CGST Act on account of non-payment of tax by the suppliers, after the Appellate Authority had dropped the Section 74 demand but upheld the ITC denial and remanded the matter for proceedings under Section 73(9).
➡️ The assessee, a manufacturer of craft paper, had purchased waste paper from two suppliers and claimed IGST ITC, which was denied under Section 16(2)(c) and Rule 36 following an audit showing that the suppliers had not deposited the tax, leading to an order under Section 74(9) demanding tax, interest and penalty aggregating ₹1.57 crore. The Appellate Authority recorded that the assessee had produced tax invoices, e-way bills, bilties, kanta parchis, purchase ledger and banking-channel payment proof, that both suppliers were registered on the dates of supply and cancelled suo motu only later, that the supplies were reflected in the assessee’s GSTR-2A, that receipt of goods was proved and that no fraud or collusion was established.
➡️ The assessee contended that Section 107(11) confers no power of remand, that the Appellate Authority cannot mechanically direct the proper officer to proceed under a particular provision when no fault was found against the assessee, and relied on the Punjab and Haryana High Court’s Division Bench ruling in Shaurya Alloys, which held that Section 16(2)(c) cannot be invoked as a standalone provision and that a supplier’s nil return or later cancellation may be a starting point for inquiry but cannot by itself justify reversal of ITC.
➡️ The Revenue argued that Section 107(11) must be read with Section 75(2), relying on the Gujarat High Court’s rulings in Bhavani Tractors and Maruti Enterprises upholding the vires of Section 16(2)(c) and the Supreme Court’s decision in Bhandari Scrap Traders, but conceded that the record should not be dealt with mechanically. The Court observed that the controversy boiled down to a purchaser who had discharged its statutory obligations while the supplier filed returns and claimed ITC without paying tax, and that Shaurya Alloys mandates an independent application of mind on whether the purchaser is liable.
➡️ On the consent of both sides, the Court left the findings recorded in the assessee’s favour undisturbed and modified the appellate order to direct the proper officer to decide the issue strictly in accordance with law, bearing in mind Shaurya Alloys, Bhavani Tractors, Bhandari Scrap Traders and Maruti Enterprises, by a reasoned and speaking order within four months after hearing the parties. No observations were made on merits, and the Revenue remains free to proceed against the defaulting suppliers.
✔️ Allahabad HC – Garg Duplex & Paper Mills Private Limited vs State of U.P. and 2 others [WRIT TAX No. – 3671 of 2026]
