LATEST GST CASE LAWS: 04.07.2025
🔥📛 HCC challenges GST demand on an arbitral award; J&K HC grants interim protection
➡️ The High Court restrained tax authorities from taking coercive action under Section 73 of the CGST Act against Hindustan Construction Company Ltd. (HCC), providing interim relief while the legality of the GST demand is under judicial review.
➡️ The case revolves around a GST demand raised on an amount received by HCC pursuant to an arbitral award. The company contests the demand, claiming the amount is not taxable at this stage.
➡️ HCC argues that the payment received is merely an interim deposit, subject to the final outcome of ongoing litigation, and thus not liable for GST as it does not constitute a concluded or enforceable consideration.
➡️ It was emphasized that the deposited amount is secured by immovable property, reinforcing its provisional nature and further questioning the applicability of GST on such a conditional transaction.
➡️ The petitioner contends that the GST order contravenes Rule 26(3) of the CGST Rules, 2017, which deals with the authentication of documents, hinting at procedural lapses in issuing the demand.
✔️ Jammu & Kashmir And Ladakh At Jammu HC – Hindustan Construction Co. Ltd. Union of India and others [WP(C) No. 1466/2025]
🔥📛 Rajasthan HC to examine validity of Circular empowering Superintendent to issue summons; Grants absolute-stay
➡️ The petitioner contested the validity of CBIC’s Circular No. 3/3/2017, arguing that it unlawfully delegated the power to issue summons under the CGST Act to Superintendents, whereas such authority lies exclusively with the Commissioner as per Section 2(91) of the CGST Act, 2017.
➡️ The petitioner emphasized the legal distinction between powers granted to “the Commissioner in the Board” and those held by “the Board” itself, asserting that the Board lacked authority to delegate such quasi-judicial powers through a circular.
➡️ The Revenue countered the petitioner’s argument, stating that the circular was not issued by the Board but by the Commissioner, thereby suggesting that the delegation was within the bounds of statutory authority.
➡️ The Rajasthan High Court acknowledged a strong prima facie case in favor of the petitioner and confirmed its earlier interim stay on the circular’s operation, making the stay order absolute pending final adjudication.
➡️ Recognizing the legal significance and wide impact of the issue, the High Court scheduled the case for final hearing in the upcoming weeks, indicating a priority review of the challenge to the circular’s legality.
✔️ Rajasthan HC – Mohit Kirana Store vs Central Board of Indirect Taxes and Customs & Another. [D. B. Civil Writ Petition No. 1030/2022]
🔥📛 HC: Deeming service through e-mail, mobile-number a ‘proper service’, relegates Assessee to file appeal
➡️ The Court upheld that service of notice under Section 169 of the CGST Act is valid when sent through the email and mobile number provided by the assessee at the time of registration, emphasizing the acceptability of electronic communication as a legitimate mode of service.
➡️ By invoking Section 13 of the Information Technology Act, 2000, the Court reinforced that electronic records sent to the declared email/mobile are deemed properly dispatched and received, thus satisfying legal service requirements under the CGST framework.
➡️ The Court clarified that Section 169 gives assessing officers discretion in choosing the mode of service—including email, courier, or speed post—making it unnecessary for the assessee to be served in person or only via physical means.
➡️ The HC ruled that there was no breach of fundamental rights of the assessee due to the service method used, as due process under Section 169(c) was followed, ensuring procedural fairness during and after assessment.
➡️ Emphasizing the principle of alternate efficacious remedy, the Court held that the assessee should pursue an appeal under Section 107 of the CGST Act, thereby dismissing the writ petition as non-maintainable.
✔️ Allahabad HC – D.R. Hotels Pvt. Ltd. Vs Deputy Commissioner, Sector 20 State Gst Lucknow [WRIT TAX No. – 575 of 2025]
🔥📛 HC: Tax-determination merely ‘supplementary’ to full SCN, cannot override proper/authenticated documents’ mandate
➡️ Summaries issued in GST forms DRC-01, DRC-02, and DRC-07 are supplementary documents and cannot replace or override the legal necessity of issuing a proper, authenticated primary SCN as mandated under Section 73 of the CGST Act, 2017.
➡️ Demand orders based solely on unsigned Summary SCNs, including tax determination attachments uploaded in DRC-01 and DRC-07 without proper authentication by a Proper Officer, are invalid and violate Rule 26(3) and Section 73 procedural safeguards.
➡️ The HC reaffirmed that the issuance of a valid SCN, a statement under Section 73(3), and an opportunity of hearing under Section 75(4) are mandatory preconditions before issuing any demand order, citing precedent from Jharkhand and Karnataka High Courts.
➡️ The court noted that Rule 26(3), which governs authentication of notices under Chapter III (Registration), does not explicitly apply to Chapter XVIII (Demand and Recovery), exposing a regulatory gap; nevertheless, proper authentication remains essential for validity.
➡️ Due to non-compliance with authentication and hearing requirements (e.g., incomplete DRC-01 details), the HC quashed the impugned demand orders and allowed the Department to initiate fresh proceedings in compliance with legal mandates.
✔️ Gauhati HC – Haemotocon 2017 vs. The State of Assam & Ors. [WP(C)/2918/2025]
🔥📛 Order to be quashed as electronic credit ledger was blocked without pre-decisional hearing and based on borrowed satisfaction: HC
➡️ The case concerns the blocking of the petitioner’s electronic credit ledger, effectively denying input tax credit without proper procedural safeguards.
➡️ The petitioner was not afforded a pre-decisional hearing before the impugned order was passed, violating principles of natural justice.
➡️ The order blocking the credit ledger was limited to a brief text message without detailed reasoning or independent evaluation.
➡️ The order depended solely on reports from the enforcement authority without independent verification or cogent reasons, which is impermissible under law.
➡️ Due to procedural and substantive deficiencies, the order was quashed, and the petitioner’s electronic credit ledger was ordered to be unblocked.
✔️ Karnataka HC – S.A. Industries v. Assistant Commissioner of Central Tax [WRIT PETITION NO. 5820 OF 2025 (T-RES)]
🔥📛 Execution of order stayed as assessee contested validity of notifications extending adjudication period: HC
➡️ The assessee contested the validity of Notification No. 56/2023-Central Tax (28-12-2023) and Notification No. 56/2023–State Tax (16-1-2024), arguing that these extended the time limit for adjudication of SCNs without proper legal authority under Section 168A of the CGST Act, which requires recommendations from the GST Council. The lack of such recommendations rendered the notifications void ab initio.
➡️ The assessee contended that if these notifications are quashed, the impugned Order-in-Original (OIO) would fall outside the permissible time frame under Section 73(10) of the CGST Act, which prescribes a 3-year limitation from the relevant due date. Thus, the OIO would be barred by limitation and invalid.
➡️ It was argued that under Section 73(1), the Show Cause Notice (SCN) must be issued at least 3 months prior to the expiry of the limitation under Section 73(10). Since the SCN was issued on 31-5-2024, the exact last date under limitation, it violated the mandatory 3-month lead time requirement, further invalidating the proceedings.
➡️ The court took note of a similar factual situation in Sunguard Builders LLP v. Union of India, where the issuance of SCN and adjudication beyond the limitation period, due to flawed notification, was challenged. The court found parity and accepted the basis for interim relief.
➡️ Given the legal issues raised—especially regarding the invalidity of notifications and breach of mandatory timelines—the court granted ad-interim relief, staying the effect, operation, and execution of the impugned OIO until further orders, thus protecting the assessee from coercive recovery.
✔️ Bombay HC – Tushar Builders and BKP Infra LLP v. Deputy Commissioner of State Tax Pune [WRIT PETITION NO. 5610 OF 2025]
🔥📛 Delay in revocation application condoned as assessee showed readiness to pay tax, interest, late fee and penalty: HC
➡️ The assessee’s GST registration was cancelled, and there was a delay in filing the application for revocation under Rule 23 of the OGST Rules.
➡️ The assessee demonstrated readiness to comply with all statutory obligations, including payment of tax, interest, late fee, and penalties, for the return filing to be accepted by the department.
➡️ The decision referenced the co-ordinate bench ruling in M/s. Mohanty Enterprises v. Commissioner, CT & GST, Odisha [2022], which supported condonation of delay in revocation applications under similar circumstances.
➡️ The court held that the proviso to Rule 23 of the OGST Rules allows for flexibility in condoning delay, particularly when the assessee shows bona fide intent and readiness to regularize compliance.
➡️ The court directed that, subject to payment of all dues and compliance with procedural requirements, the assessee’s revocation application should be considered on merits in accordance with law.
✔️ Orissa HC – Debasish Mohapatra v. State Tax Officer, CT & GST [W.P.(C) No. 16344 of 2025]
