LATEST GST CASE LAWS: 11.04.2025
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🔥📛 Bombay HC to examine if ‘Transfer of Development Rights’ under ‘revenue-sharing-agreement’ constitutes ‘supply’ ➡️ The Bombay High Court has stayed the recovery of GST arising from the Revenue’s order, which considered the transfer of development rights (TDR) by the Petitioner to L&T Asian Realty Project LLP as a ‘supply’ of services taxable under Section 7 read with Section 9 of the CGST Act, 2017. ➡️ The court granted interim relief to the Petitioner, noting that the issue is similar to one previously decided by the Gujarat High Court in the case of Gujarat Chamber of Commerce and Industry. ➡️ The Gujarat High Court had ruled that an assignment of a lease to a third party does not fall within Schedule II of the CGST Act and is therefore not taxable under GST law. ➡️ The Bombay High Court endorsed the Petitioner’s argument that there was no transfer of services in the instant case. Even if a transfer were assumed, it would be of immovable property, which is not taxable under GST law. ➡️ The court directed the Revenue to file a reply within two weeks and serve an advance copy on the Petitioner. ✔️ Bombay HC – Nirmal Lifestyle Developers Pvt. Ltdvs The Union of India & Ors [WRIT PETITION (L)NO.11011 OF 2025]
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🔥📛 Bombay HC stays coercive action in challenge made to ‘Negative Blocking’ of ECrL ➡️ The Bombay High Court has stayed coercive action in an order that sought to block the electronic credit ledger (ECrL) for an amount exceeding the available balance, as per Rule 86A of the Maharashtra Goods and Services Tax (MGST) Rules, 2017. ➡️ The court noted another issue, questioning whether a State Tax Officer can issue an order for blocking input tax credit (ITC) when Rule 86A specifies that only the Commissioner or an Officer authorized by him, not below the rank of Assistant Commissioner, has such power. ➡️ The Revenue has been directed to file a reply. The Petitioner is also permitted to file an additional affidavit. ➡️ The matter has been listed for further hearing on May 6, 2025. ➡️ Rule 86A of the GST Rules empowers the Commissioner or an authorized Officer to block ITC in the ECrL if they have reasons to believe that the credit has been fraudulently availed or is ineligible under specific conditions. ✔️ Bombay HC – Rollmans Aluminium Pvt. Ltd.vs The State of Maharashtra & Ors [WRIT PETITIONER NO. 3590 OF 2025] |
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🔥📛 Order rejecting ITC to be set aside for failure to consider Section 16(5) with direction for fresh order and hearing ➡️ The petitioner-assessee claimed Input Tax Credit (ITC) for the financial year 2017-2018 under Section 16(4) of the GST Act. However, the respondent-department rejected this claim through an order dated 13.12.2023. ➡️ In response to the denial, the petitioner filed a writ petition against the department’s order. ➡️ The court held that the incorporation of Section 16(5) extended the time limit to claim ITC for financial years 2017-18 to 2020-21 until 30.11.2021. This amendment allowed taxpayers to claim ITC that was previously disallowed due to time restrictions under Section 16(4). ➡️ The respondent-department failed to consider the provisions of Section 16(5) while rejecting the petitioner’s ITC claim. As a result, the court decided that the impugned order, which denied ITC to the petitioner, should be set aside. ➡️ The respondent was directed to pass fresh orders after considering Section 16(5) and providing the petitioner with an opportunity for a hearing. ✔️ Kerala HC – Sark Cables (P.) Ltd. v. Deputy Commissioner of Central Tax & Central Excise [WP(C) NO. 2337 OF 2024]
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🔥📛 Authority is restrained from taking coercive actions during pendency of challenge to multiple SCNs with overlapping periods: HC ➡️ The assessee received multiple Show Cause Notices from the CGST Department for overlapping periods, which they challenged. ➡️ While the petition was pending, final assessment orders were passed against the assessee on 21 January 2025, 23 January 2025, 04 February 2025, and 31 January 2025. ➡️ The High Court had previously directed that any assessment orders should comply with the final outcome of the writ petition. ➡️ The revenue authorities were restrained from taking any coercive measures against the assessee in relation to the assessment orders dated 21 January 2025, 23 January 2025, 04 February 2025, and 31 January 2025. ➡️ The revenue authorities were prays for and is granted two weeks’ further time to file a counter affidavit, with the matter scheduled for further hearing on 01st May 2025. ✔️ Delhi HC – SH Raghav Agarwal v. Principal Commissioner CGST and CX Delhi North [W.P.(C) 17260 of 2024]
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