LATEST GST CASE LAWS: 08.07.2026
🔥📛 Calcutta HC to examine whether subsequent assessment order renders pending challenge to SCN infructuous
➡️ The Calcutta High Court is examining whether a writ challenge to a GST show cause notice survives when, during the pendency of the writ petition, the adjudicating authority passes the final assessment order based on that notice.
➡️ The Assessee, a real estate developer, challenged Form GST DRC-01 on the ground that it was issued before expiry of the response period granted under Form GST DRC-01A and without considering the reply already filed, allegedly breaching Rule 142(1A) of the CGST Rules and principles of natural justice.
➡️ The Assessee also alleged that about Rs. 2.24 crore voluntarily deposited through Form GST DRC-03 during investigation was not appropriated against the proposed liability, and that incorrect tax classification in Forms DRC-01A and DRC-01 resulted in an inflated demand.
➡️ The Revenue argued that the pre-notice intimation in Form GST DRC-01A is directory rather than mandatory in proceedings under Section 74(5), that the writ petition became infructuous after the assessment order was passed, and that the Assessee should pursue the statutory appeal remedy under Section 107 of the CGST Act.
➡️ Finding a prima facie case on the effect of the subsequent assessment order on the pending challenge to the show cause notice, the High Court stayed operation of the assessment order until September 30, 2026 or further orders, directed exchange of affidavits, and listed the matter for hearing in September 2026.
✔️ Calcutta HC – Primarc Projects Realty Private Limited Vs. Additional Director, Directorate General of GST Intelligence, Kolkata Zonal unit & Ors. [WPA 24967 of 2025]
🔥📛 Madras HC to examine ITC denial in ‘Bill-to Ship-to’ transaction overlooking Section 16(2) explanation
➡️ The Madras High Court granted an interim stay on recovery of the disputed GST demand in a writ petition challenging the denial of input tax credit arising from a “bill-to ship-to” transaction.
➡️ The Assessee argued that it had instructed the supplier to deliver the goods directly to the consignee and therefore qualified as having received the goods under the statutory deeming provision in the Explanation to Section 16(2) of the CGST Act, 2017.
➡️ The Revenue denied ITC solely because the transportation documents showed direct movement of goods from the supplier to the consignee, rather than physical delivery to the Assessee.
➡️ The Assessee contended that both the adjudicating and appellate authorities failed to consider the statutory deeming fiction applicable to such transactions and wrongly upheld the ITC denial on the same ground of non-delivery to the Assessee.
➡️ Finding that the challenge raised a prima facie case requiring examination, the High Court stayed the impugned demand pending further proceedings and directed the Revenue to file its reply.
✔️ Madras HC – S.M.K Enterprises vs Appellate Deputy Commissioner (ST) and Another
🔥📛 HC: Cancelling GST registration on grounds beyond SCN violates natural justice
➡️ Telangana High Court quashed the GST registration cancellation order because the ground ultimately relied upon was never stated in the show cause notice, denying the assessee a fair opportunity to respond.
➡️ The show cause notice alleged that registration was obtained by fraud, invoices were issued without actual supply of goods or services, and business was not conducted from the declared place of business.
➡️ The cancellation order instead relied on non-furnishing of six consecutive returns under Rule 21(h) of the CGST Rules, a ground entirely different from those invoked in the show cause notice under Section 29(2)(e) of the CGST Act and Rules 21(a) and 21(b).
➡️ The Court held that a cancellation order cannot travel beyond the scope of the show cause notice, and reliance on an unnotified ground violates principles of natural justice because the assessee was never put on notice or allowed to defend against that allegation.
➡️ Accordingly, the Court quashed both the show cause notice and cancellation order, restored the assessee’s GST registration, and permitted the Revenue to issue a fresh notice specifying precise grounds and supporting documents before proceeding in accordance with law.
✔️ Telangana HC – A.P. Enterprises Vs The Superintendent of Central Tax [WRIT PETITION No. 30400 OF 2025]
🔥📛 HC: Orders fresh adjudication on ITC claim under retrospective Section 16(5)
➡️ Calcutta HC quashed the Section 73 order denying ITC for AY 2018-19, holding that the Assessee’s claim must be reconsidered in light of the retrospectively inserted Section 16(5) of the CGST Act.
➡️ The Court noted that Section 16(5), introduced by the Finance (No. 2) Act, 2024, retrospectively regularises ITC for FYs 2017-18 to 2020-21 where the relevant GSTR-3B returns were filed by November 30, 2021.
➡️ Since the Assessee claimed that returns for July 2018 to March 2020 were filed before the statutory cut-off date, the Court prima facie held that the benefit of the curative and retrospective amendment could not be denied without verifying the actual filing dates.
➡️ The Court also recorded the Assessee’s objection that a subsequent order for the same assessment year amounted to double adjudication, while Revenue maintained that the later order merely rectified the earlier adjudication.
➡️ Relying on Hiranmoy Dutta, the Court held that ITC stands regularised once returns are filed within the extended statutory timeline, and therefore directed Revenue to re-adjudicate the original order after verification within six weeks, with no coercive action until completion of the exercise.
✔️ Calcutta HC – A2Z Infra Engineering Ltd Vs Union of India & Ors. [WPA 22309 of 2024]
