LATEST GST CASE LAWS: 16.09.2025
🔥📛 Delhi-HC issues notice on EbixCash plea over pre-CIRP dues, ITC-denial to customers
➡️ The Petitioner (Ebix Cash Mobility Software India), as a successful Resolution Applicant under IBC, asserts that it inherits the business free of pre-moratorium liabilities of the erstwhile Corporate Debtor (Trimax IT Infrastructure & Services Ltd.).
➡️ Revenue authorities sought to recover pre-CIRP tax dues of ₹5.62 crores by blocking Input Tax Credit (ITC) of customers of the Petitioner, thereby indirectly burdening the new entity with past liabilities.
➡️ The denial of ITC to customers such as NICSI (ITC blocked worth ₹3.4 crores) was argued to adversely impact the Petitioner’s ability to conduct its business, despite statutory approval of the Resolution Plan.
➡️ The Petitioner urged that under the CGST Act, “payment of tax” should be purposively interpreted to include discharge of liability via an approved Resolution Plan, not just cash remittance, thereby extinguishing earlier dues.
➡️ Recognizing the urgency, the Delhi High Court issued notice, directed filing of counter-affidavits, and scheduled the matter for hearing on 9th October 2025, keeping the issue of ITC denial linked to insolvency resolution open for adjudication.
✔️ Delhi HC – Ebix Cash Mobility Software India Limited vs. Commissioner, Department of Trade & Taxes & ors. [W.P.(C) 13416/2025]
🔥📛 Delhi HC sets final hearing date this week to examine GST on corporate guarantee
➡️ The Delhi High Court is examining whether issuance of corporate guarantees by group companies in favour of banks/financial institutions qualifies as a “supply” under Section 7 of the CGST Act, thereby attracting GST.
➡️ The petitioner argues that corporate guarantees are not a “supply of services” but rather “actionable claims,” which are expressly excluded from GST. They contend that the show cause notices (SCNs) lack statutory basis.
➡️ Circulars No. 204/16/2023-GST and 225/19/2024-GST are challenged as ultra vires for retrospectively imposing tax liability. Additionally, Rule 28(2) of the CGST Rules is alleged to violate Article 14 due to discriminatory valuation of related-party transactions.
➡️ The Court highlighted that resolution will hinge on the scope of “services” under Section 2(102), which excludes “securities.” This definitional aspect is central to determining whether guarantees fall within the taxable net.
➡️ Since pleadings are incomplete in some matters, the Revenue has been given a final opportunity to file counter-affidavits. Meanwhile, interim relief continues, restraining adjudication of SCNs. Written submissions are to be filed a week before the hearing, with mandatory physical presence of counsel for final arguments from September 19.
✔️ Delhi HC – Sterlite Power Transmission Limited and Ors vs Union of India & ors [W.P.(C) 2966/2024]
🔥📛 HC: Appeal filing alongside provisional attachment orders renders attaching bank accounts ineffective
➡️ The assessee filed an appeal against the demand orders, complying with the statutory pre-deposit requirement.
➡️ The Court clarified that once an appeal is filed with the prescribed pre-deposit, recovery proceedings are deemed stayed by operation of law.
➡️ Since the appeal triggered the automatic stay, provisional attachment of the assessee’s bank accounts under Section 83 could not legally continue.
➡️ The High Court set aside the attachment orders passed by the Deputy Excise & Taxation Commissioner, holding them unsustainable.
➡️ The assessee was permitted to operate its two bank accounts, reinforcing that authorities cannot pursue coercive recovery once the appellate remedy under Section 107 has been invoked.
✔️ Delhi HC – Benito Operations And Technologies Pvt. Ltd Vs Deputy Excise And Taxation Commissioner St Gurgaon North [W.P.(C) 5712/2025]
🔥📛 HC: Dismisses writ where no appeal was lodged within maximum condonable period
➡️ The Court reiterated that appeals before the Appellate Authority must be filed within 3 months, with only a further 1-month condonable delay permitted.
➡️ By restricting condonation to a maximum of 1 month, the legislature clearly intended to create a strict timeline for appeals, leaving no scope for discretionary extensions.
➡️ The High Court held that Article 226 cannot be invoked to bypass statutory limitations when an appeal is filed beyond the prescribed or condonable period.
➡️ From the records, the Court found that the assessee’s appeal was attempted even beyond the maximum condonable period, making the plea of non-communication irrelevant.
➡️ As the appeal was filed after 4 months from communication of the order, the writ petition was dismissed, reinforcing that strict compliance with statutory timelines is mandatory in GST litigation.
✔️ Bombay HC – MAP Overseas Vs Union of India & Ors [WRIT PETITION NO. 8229 OF 2025]
🔥📛 HC: Declares Circular restricting refund claims on inverted-duty-structure w.r.t Mustard-Oil, partly illegal
➡️ The Court struck down Point No. 2 of Circular No. 181/13/2022-GST as illegal and arbitrary, holding that it wrongly restricted refund applications under the inverted duty structure (IDS) only if filed before 18.07.2022, despite no such restriction in the parent Notification or Section 54.
➡️ Notification No. 09/2022-CT (Rate) barred ITC on mustard oil (HSN 1514) only prospectively from 18.07.2022. Hence, ITC and related refund claims for purchases made up to this date remained valid.
➡️ The Court clarified that refund applications can be filed within the statutory period of two years under Section 54. Denial of claims filed after 18.07.2022 for taxes paid prior to that date was held contrary to law.
➡️ The Court held that the circular’s cut-off created two irrational classes—those filing before 18.07.2022 and those filing after—resulting in arbitrary discrimination and violation of Article 14.
➡️ Authorities cannot withhold or reject refund applications citing the impugned circular. Refunds on IDS claims for mustard oil paid up to 18.07.2022 must be processed in line with the Notification and Section 54.
✔️ Rajasthan HC – Shree Arihant Oil and General Mills vs UOI & ors. [D.B. Civil Writ Petition No. 2932/2023]
🔥📛 SLP dismissed; mere technical error in e-way bill address not valid ground for seizure when goods match in quantity/quality
➡️ The assessee ordered 16mm TMT bars from the manufacturer, with the invoice billed to the assessee but goods delivered at New Delhi; the e-way bill was auto-generated by the GST portal.
➡️ Goods were intercepted because the e-way bill showed the shipping address as West Bengal, while the tax invoice mentioned New Delhi. No issues were found with the quantity, quality, or tax particulars of the goods.
➡️ The purpose of the e-way bill is to inform authorities about movement of goods so that transactions are taxed properly. A technical error in the auto-populated address cannot be the sole basis for seizure or penalty.
➡️ Since the mismatch arose from system-generated details and no tax evasion was evident, the High Court quashed the penalty and seizure orders.
➡️ On appeal, the Supreme Court refused to interfere under Article 136, dismissing the revenue’s SLP, thereby upholding the High Court’s decision in favor of the assessee.
✔️ SC – Additional Commissioner Grade-2 v. Zhuzoor Infratech (P.) Ltd. [(IA No. 210724/2025 – CONDONATION OF DELAY IN FILING IA No. 210726/2025 – EXEMPTION FROM FILING O.T.) [2025]
🔥📛 Arrest unjustified if accused is complying with summons and cooperating in investigation: HC
➡️ On suspicion of GST evasion, authorities conducted a search, seizing the assessee’s laptop and mobile. The assessee was arrested under section 69 of the CGST Act despite complying with summons and cooperating in the investigation.
➡️ As per section 35(3) of BNSS, 2023 and Supreme Court’s Arnesh Kumar v. State of Bihar (2014) guidelines, prior notice before arrest was required unless specific reasons were recorded showing necessity.
➡️ The arrest memo merely stated that the assessee “might influence witnesses and tamper evidence,” without detailing material facts or grounds as mandated under section 35(1)(b)(ii) BNSS, 2023. This was treated as a mechanical and legally insufficient justification.
➡️ Failure to record proper reasons in writing and non-issuance of notice under section 35(3) BNSS, 2023 amounted to violation of statutory safeguards and Supreme Court guidelines, rendering the arrest procedurally defective.
➡️ Given the violations and assessee’s cooperation, bail was granted on a bond of ₹1 lakh with surety, subject to conditions: cooperation in investigation, appearance when required, non-interference with witnesses/evidence, providing contact details, and restriction on leaving jurisdiction without permission.
✔️ Gauhati HC – Gaurav Agarwal v. Union of India [Bail Appln. No. 2787 OF 2025]
🔥📛 HC quashes duplicate overlapping demand orders passed on same cause of action
➡️ Two separate show cause notices (SCNs) were issued to the assessee on the same cause of action, both proposing tax demands for the same transactions.
➡️ Both SCNs culminated into separate OIOs, confirming demands that substantially overlapped, resulting in duplication of tax liability.
➡️ The assessee contended that the demands were raised twice for the same set of transactions and sought rectification of the impugned OIO on grounds of overlap.
➡️ During proceedings, the Revenue itself acknowledged that the impugned OIO was indeed overlapping with the earlier order.
➡️ Considering the duplication, both the impugned OIO and the subsequent rectification order were quashed, ensuring no double recovery of tax for the same cause of action.
✔️ Delhi HC – Nitender Thakur v. Assistant Sales Tax Officer Delhi [W.P. (C) No. 17601 of 2024]
