LATEST GST CASE LAWS: 12.08.2026
🔥📛 Madras HC to examine demand based on CERA- report noting Assessee’s failure to deny its contents
➡️ The Madras High Court noted that the dispute concerns a substantial mismatch between purchase turnover of about Rs. 3.5 crore stated in the CERA report and inward supplies of about Rs. 1.21 crore reflected in GSTR-4A, making factual reconciliation central to the challenge.
➡️ The assessee argued that the CERA report forming the basis of the demand was never furnished and maintained that CMP-08 returns, GSTR-4A data and books of account were reconcilable, thereby questioning the factual foundation of the assessment.
➡️ The Court recognised that the turnover issue is particularly significant for a composition dealer because exceeding the prescribed aggregate-turnover limit could result in loss of eligibility for the composition scheme and consequent tax implications.
➡️ The Court observed that the assessee’s earlier reply did not specifically dispute the alleged inward-supply figure and relied mainly on the contention that GSTR-4A is system-generated; it also noted that the objection regarding non-supply of the CERA report had not been raised before the lower authority.
➡️ Since the controversy involves disputed factual figures that should ordinarily be examined in statutory appellate proceedings, the Court indicated that an appeal would be the appropriate remedy, but granted the assessee additional time to obtain instructions and explain the substantial difference before further hearing.
✔️ Madras HC – THE NEW CHENNAI MEDICALS VS THE ASSISTANT COMMISSIONER
🔥📛 Rajasthan HC grants interim protection to Assessee facing parallel CGST-SGST adjudication on identical issue
➡️ Rajasthan High Court granted interim protection to the assessee in a dispute involving alleged parallel adjudication by the State GST and Central GST authorities on the same issue, tax period and demand amount.
➡️ The assessee contended that the SGST Department had already adjudicated the identical dispute and completely set aside the demand; therefore, continuation of CGST proceedings on the same subject was impermissible in view of the statutory restriction under Section 6(2)(b) of the GST law.
➡️ The challenge also raised concerns of arbitrariness and inconsistency, as two contradictory Orders-in-Appeal were allegedly passed by the same Central Appellate Authority arising from a single adjudication order.
➡️ The case highlights the principle that simultaneous or repetitive proceedings by Central and State GST authorities on an already adjudicated identical subject may be open to challenge, particularly where Section 6(2)(b) is invoked to prevent overlapping jurisdiction.
➡️ Pending examination of these issues in the writ petition, the High Court directed that no coercive action be taken against the assessee and listed the matter for further hearing on September 7, 2026.
✔️ Rajasthan HC – Azure Power India Pvt. Ltd. v. Union of India [D.B. Civil Writ Petition No. 14323/2026]
🔥📛 Allahabad HC stays over Rs.600 cr demand against Myntra over place of supply dispute
➡️ The Allahabad High Court stayed recovery of the entire GST demand of about ₹617.92 crore raised against Myntra Designs Pvt. Ltd. for FYs 2022-23, 2023-24 and 2024-25 under Sections 74/74A of the CGST Act read with the UPGST Act, while examining Myntra’s challenge to the jurisdiction of the Uttar Pradesh GST authorities.
➡️ The central issue is whether marketplace and allied services supplied through Myntra’s Karnataka GST registration can be treated as intra-State supplies in Uttar Pradesh. Myntra argued that the relevant agreements with sellers, invoicing and discharge of IGST were all undertaken through its Karnataka registration, making the supplies inter-State transactions.
➡️ Myntra contended that Karnataka is the “location of supplier”, while the place of supply is the location of the respective registered sellers. Accordingly, the transactions fall within Section 7 of the IGST Act and cannot be subjected to UPGST merely because Myntra also holds a GST registration in Uttar Pradesh.
➡️ The jurisdictional challenge was based on the absence of any material in the show-cause notices showing a territorial nexus with Uttar Pradesh or explaining how transactions already treated as inter-State supplies could legally be re-characterised as intra-State supplies. Myntra also highlighted that its Uttar Pradesh activities were substantially confined to call centres and Tax Collection at Source-related functions.
➡️ Myntra further argued that the dispute is revenue-neutral because IGST has already been paid on the entire disputed turnover. It relied on Section 77 of the CGST Act read with Section 19 of the IGST Act, which address situations where tax is paid under the wrong head, to contend that the Department cannot effectively recover tax again merely because it disputes the inter-State classification.
✔️ Allahabad HC – Myntra Designs Private Limited vs State of UP and ors.
🔥📛 HC: Recipient cannot be subjected to custodial interrogation absent prima facie collusion with suppliers; Grants bail
➡️ Karnataka High Court held that a registered purchaser who holds valid tax invoices, pays the invoice value and GST to the supplier through banking channels, and files prescribed GST returns should not ordinarily be denied ITC merely because the supplier later defaults, disappears, or has its GST registration cancelled; denial requires prima facie proof of fraud or collusion by the purchaser.
➡️ The Court observed that where the suppliers were registered and active when the transactions took place, their subsequent non-existence or cancellation of registration is not, by itself, sufficient to disallow the purchaser’s ITC. Except in exceptional circumstances involving purchaser complicity, recovery should ordinarily be pursued against the defaulting supplier.
➡️ Genuine receipt of goods can be demonstrated through objective records such as e-way bills, transport documents, weighbridge slips, stock records and subsequent sales records. Where purchasers are willing to produce such evidence, custodial interrogation is generally unnecessary unless the Department has material indicating that they knowingly participated in fictitious transactions or colluded with the suppliers.
➡️ Relying on Radhika Agarwal, the Court reiterated that arrest under Section 69 of the CGST Act cannot be used merely as an investigative tool to determine whether the ingredients of an offence under Section 132 are ultimately established. The Commissioner’s “reasons to believe” must be based on relevant material indicating commission of a specified offence warranting arrest.
➡️ Referring also to Akram Pasha, whose SLP was dismissed by the Supreme Court, the Court held that the economic nature of an alleged GST offence or the possibility of imprisonment up to five years does not automatically justify custodial interrogation. It therefore granted anticipatory bail, subject to appearance before the authorities, cooperation with investigation, execution of a ₹5 lakh personal bond with two sureties, and compliance with other conditions.
✔️ Karnataka HC – Abdul Majid & Ors vs The Assistant Commissioner of Commercial Taxes [CRIMINAL PETITION NO. 9260 OF 2026]
🔥📛 HC: Adequacy of reasons, reliance on electronic data, and earlier audit plea not effective to bypass appellate remedy
➡️ The Delhi High Court declined to entertain the writ petition under Article 226, holding that the assessee had an effective statutory remedy of appeal under Section 107 of the CGST Act. Since the assessee had participated in adjudication through its authorised representative and filed a detailed reply, its objections primarily concerned the correctness of the adjudication rather than any complete denial of opportunity.
➡️ Allegations that hearing notices were ineffective, the reply was not properly considered, cross-examination was denied, or the adjudicating authority inadequately addressed the assessee’s submissions did not, on the facts, establish a breach of natural justice warranting writ intervention. Questions regarding adequacy of reasoning and sustainability of conclusions are matters for the appellate authority.
➡️ Challenges to the use of electronic data recovered from a third party, including its authenticity, admissibility, evidentiary value, need for forensic examination and the requirement of cross-examination, involve disputed questions of fact and law. The Court held that such evidentiary issues should ordinarily be examined in a statutory appeal under Section 107 rather than in writ proceedings.
➡️ The assessee’s contention that fresh proceedings were impermissible because an earlier audit had already been conducted under Section 65 was also left for appellate determination. Whether the audit covered the same transactions, whether later proceedings were based on fresh investigation material, and whether there was any overlap or duplication of tax liability require detailed examination of departmental records and facts.
➡️ Accordingly, the High Court dismissed the writ petition while preserving the assessee’s right to file an appeal under Section 107. It further directed that the period during which the writ petition remained pending should be excluded while computing limitation for the appeal, though the appellate authority would independently examine the limitation issue in accordance with law.
✔️ Delhi HC – Wizard Digitek Computers Pvt. Ltd Vs Union Of Inida & Ors [W.P.(C) 3874/2026]
🔥📛 SC: Rule 96(10) omission, without a saving clause, nullifies all pending proceedings; Upholds Gujarat HC judgment
➡️ The Supreme Court upheld the Gujarat High Court’s ruling that the omission of Rule 96(10) of the CGST Rules by Notification No. 20/2024, effective October 8, 2024, applies to all proceedings that were still pending on that date. Consequently, demands, show-cause notices, refund disputes and court proceedings based on Rule 96(10) cannot continue merely because they were initiated before its omission.
➡️ The decisive factor was that Rule 96(10) was omitted without any saving clause preserving earlier proceedings. Applying settled principles governing repeal and deletion of statutory provisions, including the Constitution Bench ruling in Kolhapur Canesugar Works Ltd., the Supreme Court held that an omitted provision is treated as removed from the statute book and pending proceedings cannot survive unless their continuation is expressly saved.
➡️ The Supreme Court rejected Revenue’s argument that the GST Council intended the omission to operate only prospectively so that proceedings commenced before October 8, 2024 could continue. It held that, although the omission itself takes effect prospectively from that date, its absence thereafter prevents continuation of proceedings that had not attained finality; this does not amount to giving the omission retrospective effect.
➡️ The Court noted that Rule 96(10), which restricted IGST refunds to exporters availing specified exemption or concessional-tax benefits, was omitted because it had created unnecessary complications without serving the intended purpose. The absence of a saving clause therefore reflected an intention to end those complications completely, including in pending disputes, rather than preserve them for earlier periods.
➡️ Dismissing Revenue’s appeals and finding no reason to interfere with the Gujarat High Court’s well-reasoned judgment, the Supreme Court has effectively settled the treatment of pending Rule 96(10) disputes. Since similar matters and conflicting orders were pending before several High Courts, it directed circulation of its order to those courts so that pending cases may be disposed of expeditiously in accordance with this principle.
✔️ SC – Goodluck India Limited & Anr vs UOI & ors [Petition(s) for Special Leave to Appeal (C) No(s).24550/2025]
🔥📛 GSTAT: Refund of erstwhile CENVAT credit u/s 142(3) appealable before CESTAT; Tribunal lacks jurisdiction
➡️ GSTAT Thane held that a refund claim for accumulated and unutilised CENVAT credit, even when processed under Section 142(3) of the CGST Act, 2017, must be decided under the applicable provisions of the erstwhile law, particularly Section 11B of the Central Excise Act, 1944.
➡️ Since both the original adjudication order and the first appellate order concerned cash refund of unutilised CENVAT credit and were passed under the Central Excise Act, the dispute retained its character as a legacy Central Excise matter rather than becoming a GST dispute.
➡️ The Tribunal rejected Revenue’s argument that mere reference to Section 142(3) of the CGST Act conferred appellate jurisdiction on GSTAT, noting that Section 142(3) itself requires pending refund claims to be disposed of in accordance with the existing law.
➡️ Relying on the CESTAT Larger Bench ruling in Bosch Electrical Drive India Pvt. Ltd. v. Commissioner of Central Tax, Chennai, GSTAT observed that appeals arising from rejection or determination of legacy CENVAT credit refund claims under Section 142(3) are maintainable before CESTAT.
➡️ Accordingly, GSTAT dismissed Revenue’s appeal as not maintainable for lack of jurisdiction, while granting liberty to Revenue to approach the appropriate appellate forum, namely CESTAT.
✔️ GSTAT Thane Bench – Asish Kumar Pati vs. Kairav Chemofarbe Industries Limited [APL/3/THN/2026]
🔥📛 SC: Dismisses HDPE drum supplier’s SLP against denial of concessional rate for non-supply to ‘port of export’
➡️ The Supreme Court dismissed the SLP against the Karnataka High Court judgment, finding no ground to interfere under Article 136 of the Constitution. Consequently, the Karnataka High Court ruling denying the concessional 0.1% IGST rate under Notification No. 41/2017–Integrated Tax (Rate) remains undisturbed.
➡️ The Karnataka High Court held that the 0.1% concessional IGST rate is available only where the conditions prescribed in Notification No. 41/2017 are strictly satisfied. The scheme applies to supplies made to a registered merchant exporter for export and does not extend to supplies effectively made to another person merely because the goods are ultimately exported.
➡️ The prescribed movement of goods is crucial: pursuant to the merchant exporter’s order, the goods must move directly from the registered supplier to the port, ICD, airport, land customs station or other permitted place from where they are to be exported. Routing the goods first to a third-party manufacturer for packing or further handling does not satisfy this requirement.
➡️ In the present case, HDPE drums were delivered to a chemical manufacturer producing ethyl alcohol, where they were used for packing before the goods were transferred to the merchant exporter. The High Court held that this three-party arrangement fell outside the notification, which contemplates compliance between the registered supplier and registered recipient/merchant exporter.
➡️ The Court rejected the argument that an undefined “warehouse” could include any place of business nominated by the merchant exporter. Since concessional notifications must operate according to their stated conditions, their language cannot be expanded or diluted to cover indirect supply arrangements; GST professionals should therefore ensure strict compliance with the prescribed recipient, movement, export-location and 90-day export conditions when claiming the 0.1% rate.
✔️ SC – Time Technoplast Ltd. vs Union of India & Ors. [PETITION(S) FOR SPECIAL LEAVE TO APPEAL (C) NO(S). 25801/2026]
🔥📛 HC: No Rule 89(2)(m) certification for refund of interest on already sanctioned GST refund
➡️ The Telangana High Court held that where the principal GST refund has already been sanctioned and disbursed, a subsequent claim limited to interest on the delayed refund under Section 56 of the CGST Act should be processed without insisting on certification under Rule 89(2)(m) of the CGST Rules.
➡️ The assessee’s refund-related interest claims for the period July 2018 to March 2021 had remained pending from June 3, 2025, after deficiency memos sought additional documents, including an undertaking under Section 16(2)(c) and certification regarding unjust enrichment under Rule 89(2)(m).
➡️ The assessee argued that once the refund amount itself had been approved and paid, the statutory interest arising from delayed payment could not have been passed on to another person; therefore, requiring unjust-enrichment certification for the interest component served no practical or legal purpose.
➡️ Accepting the distinction between the already-settled principal refund and the pending interest claim, the High Court directed the assessee to submit a summary of the refund amounts and corresponding interest claims to the Proper Officer for verification and adjudication.
➡️ The Proper Officer was directed to scrutinise and decide the interest claims within two weeks without demanding Rule 89(2)(m) certification, reinforcing that procedural requirements applicable to refund claims should not be mechanically extended to statutory interest on refunds that have already been sanctioned and paid.
✔️ Telangana HC – Synchrony International Service Private Ltd & Anr. Vs Assistant Commissioner (ST), STU-1, Abids Circle, Hyderabad & Ors. [WRIT PETITION Nos. 12047, 12052, 12127, 12128, 12130, 12132, 12133 and 12134 of 2026]
🔥📛 HC: Section 73 proceedings sine qua non for Section 128A interest waiver; Self-assessed tax not excluded
➡️ The Madras High Court held that Section 128A relief is available where proceedings have been initiated under Section 73, which is a necessary condition for invoking the interest and penalty waiver scheme. Self-assessed tax liabilities are not automatically excluded merely because Section 75(12) permits direct recovery; once the Department adopts the Section 73 route, Section 128A can apply subject to its statutory conditions.
➡️ Rejecting the Revenue’s reliance on Circular No. 238/32/2024-GST, the Court ruled that an administrative circular cannot narrow the scope of Section 128A by excluding interest arising from delayed returns or delayed reporting of supplies when the underlying demand proceedings were initiated under Section 73. Had Parliament intended to exclude self-assessed tax, it could have expressly made Section 128A subject to Section 75(12).
➡️ The Court harmonised Sections 75(12) and 128A by holding that Section 75(12) enables direct recovery of unpaid self-assessed tax where no Section 73 proceedings are initiated, while Section 128A becomes relevant when the Department chooses determination under Section 73. The legislative history, including the 53rd GST Council recommendations, also showed no intention to exclude self-assessed tax, whereas erroneous refunds were expressly excluded.
➡️ The time limits prescribed under Rule 164 were held to be mandatory. Accordingly, waiver applications must be filed and statutory payments made within the prescribed period; belated applications cannot be entertained merely because Rule 164(6) uses the word “may”. Conversely, where the proper officer fails to decide a valid waiver application within the stipulated time, the application is deemed approved and the proceedings concluded, subject to fulfilment of Section 128A requirements.
➡️ The Court further held that an approval issued in Form GST SPL-05 cannot later be treated as void except in circumstances specifically recognised by Rule 164, such as failure to pay additional tax liability or specified interest/penalty relating to erroneous refunds or periods outside July 2017–March 2020. On this basis, 20 petitions were allowed and rejection/void orders were set aside, while 8 petitions were dismissed for failures such as delayed filing, delayed payment, absence of a waiver application, or non-compliance with essential statutory conditions.
✔️ Madras HC – Incompressible Fluid Control System & Ors vs The Assistant Commissioner & Ors [WP Nos. 21378, 6259, 1311, 1317, 1320, 6199, 6230, 6246, 9766, 16441 of 2025]
