LATEST GST CASE LAWS: 17.06.2025
🔥📛 HC: Cash-credit account unbound by phrase ‘any property’ appearing in section 83: Quashes attachment
➡️ The Bombay High Court, following decisions from Gujarat High Court and its own coordinate bench, held that a cash credit account is not governed by Section 83 of the MGST Act.
➡️ The assessee challenged the State Nodal Officer’s provisional attachment of their cash credit account held with ICICI Bank, seeking to quash the attachment.
➡️ The Court found the communication to the bank for attaching the cash credit account to be “wholly without jurisdiction,” as Section 83 applies to “any property, including bank accounts,” but excludes cash credit accounts.
➡️ The Court clarified that a cash credit account represents a liability owed by the account holder to the bank, not an asset or property subject to attachment under Section 83.
➡️ The High Court directed the Revenue to withdraw the attachment within 24 hours but allowed them to pursue other recovery methods for any pending GST dues.
✔️ Bombay HC – Skytech Rolling Mill Pvt. Ltd. Vs. Joint Commissioner of State Tax [WRIT PETITION NO. 1928 OF 2025]
🔥📛 HC: Denies ITC citing recipient’s failure to demonstrate tax-deposit by supplier with cancelled registration
➡️ The Allahabad High Court upheld the denial of Input Tax Credit (ITC) to the assessee because the supplier’s GST registration was cancelled after the supply of goods, and the assessee failed to comply with the conditions under amended Section 16(2)(c) and Section 41 regarding ITC reversal when the supplier does not pay tax.
➡️ The court emphasized that Section 16 must be read alongside Section 41, which initially allowed provisional acceptance of ITC claims, but compliance with the requirements of Section 16(2)(c) is mandatory for claiming ITC.
➡️ The assessee claimed ITC based solely on tax invoices from the supplier, Shree Radhey International, for supplies made in 2018, but did not provide any further documentation proving that the supplier actually paid the tax to the government.
➡️ The court relied on its prior judgment in Shiv Trading and the Supreme Court’s ruling in Ecom Gill Coffee Trading, which held that ITC cannot be granted merely on the basis of invoice or payment evidence without proof of tax remittance by the supplier.
➡️ Ultimately, since the assessee failed to produce any documents other than tax invoices to demonstrate that the supplier had deposited the tax as required under Section 16(2)(c), the ITC claim was rightly denied.
✔️ Allahabad HC – Trendships Online Services Private Limited Vs Commissioner Commercial Taxes U.P. At Lucknow And Another [WRIT TAX No. – 501 of 2023]
🔥📛 HC: Allows ITC-refund on export to sister-concern abroad; Rejects Revenue’s ‘agency’, ‘distinct-person’ analogy
➡️ The Bombay High Court quashed orders denying refund of unutilized Input Tax Credit (ITC) on engineering and design services exported by the assessee to its sister/group company abroad, directing the refund with statutory interest under section 56.
➡️ The Court rejected the Revenue’s claim that the assessee and the foreign entity did not meet the “distinct person” condition under section 2(6)(v) of the IGST Act, clarifying that entities with establishments in India and abroad are considered distinct persons.
➡️ The Court dismissed the Revenue’s argument that the assessee acted as an agent of the foreign company, emphasizing the agreement which established the assessee as an independent contractor and not an agent or employee.
➡️ It was found that the assessee exported services on a principal-to-principal basis, using its own manpower and resources without control from the foreign recipient, affirming that the assessee was not conducting business on behalf of the foreign entity.
➡️ The Court relied on CBIC Circular No. 161/2017/2021 and relevant case law (Xilinx India Technology Services) to clarify that condition (v) applies only when a branch or agency supplies services to its foreign parent company, making the Revenue’s reliance on related party provisions and the need for a third party irrelevant.
✔️ Bombay HC – Sundyne Pumps and Compressors India Pvt Ltd. Versus The Union of India [WRIT PETITION NO. 15228 OF 2023]
🔥📛 Writ petition not maintainable against order in absence of breach of fundamental rights or natural justice: HC
➡️ The department alleged that the petitioner entity fraudulently availed Input Tax Credit (ITC) and issued a show cause notice (SCN) accordingly.
➡️ The petitioner challenged the original order, claiming it was passed by an authority different from the one that issued the SCN and that a consolidated SCN covered multiple financial years.
➡️ The court held that the petitioner could raise these contentions in an appeal under Section 107 of the CGST Act rather than through a writ petition.
➡️ The writ petition was dismissed as there were no exceptional circumstances such as breach of fundamental rights, violation of natural justice, excess jurisdiction, or challenge to the validity of the statute.
➡️ The court noted that the decision in the related pending case of Quest Infotech Pvt. Ltd. would be binding on future proceedings if the petitioner opts to appeal the impugned order.
✔️ Delhi HC – Jasmeet Trading Company v. Additional Commissioner, CGST, Delhi North [W.P. (C) No. 8032 of 2025]
🔥📛 Matter remanded as specific rebuttals in reply of SCN were ignored and no personal hearing was granted: HC
➡️ The petitioner-assessee claimed to have submitted a reply to the show cause notice but was not granted a personal hearing.
➡️ The key issues regarding taxable versus exempt supplies and the entitlement to Input Tax Credit (ITC) were not addressed in the impugned order.
➡️ The assessee specifically stated that no ITC related to exempt supplies was availed, as their business involved direct trading from manufacturers to customers.
➡️ Despite the detailed reply, the impugned order dismissed it as unsatisfactory without proper consideration.
➡️ Consequently, the impugned order was set aside, and the assessee was entitled to a personal hearing to fairly address the issues.
✔️ Delhi HC – Adam Smith Commodities (P.) Ltd. v. Commissioner of Delhi Goods and Services Tax [W.P. (C) No. 7025 OF 2025]
🔥📛 Refund cannot be denied on basis of fresh discrepancies raised by Joint Commissioner after sanction was justified: HC
➡️ The Assistant Commissioner (R-3) initially found the assessee entitled to a refund after resolving six discrepancies raised by the Joint Commissioner (R-2) and forwarded the refund sanction for R-2’s approval.
➡️ Despite R-2 issuing a repeated communication raising the same discrepancies, the Assistant Commissioner (R-3) reaffirmed the assessee’s entitlement to the refund based on the assessee’s response, making the rejection of the refund claim erroneous.
➡️ The rejection of the refund claim based solely on the repeated communication from R-2 without fresh grounds was improper and deserved to be set aside.
➡️ On appeal, the Joint Commissioner (R-1) wrongly upheld the Assistant Commissioner’s rejection order simply because he was of the same rank as R-2, failing to appreciate that his role was appellate in nature.
➡️ The appellate authority (R-1) must independently reconsider the merits of the appeal without being influenced by the administrative role or findings of R-2, and rank similarity cannot justify summary dismissal of the appeal.
✔️ Karnataka HC – Hitachi Energy India Ltd. v. Joint Commissioner of Commercial Taxes, Bengaluru [WRIT PETITION NO. 12771 OF 2025 (T-RES)]
🔥📛 Writ petition to be dismissed since allegations involved misuse of ITC through goods-less invoices: HC
➡️ The case involved denial of Input Tax Credit (ITC) due to allegations of fraudulent transactions based on bogus invoices from non-existent firms.
➡️ The assessee claimed they were not issued a show cause notice (SCN) or personal hearing notice before the order was passed.
➡️ It was found that multiple notices were indeed issued, some parties responded, and personal hearings were conducted.
➡️ The SCN had the correct address of the assessee, matching official records, but the delivery report oddly stated ‘no such person’ at that address without valid reason.
➡️ Since the assessee was given proper notice and opportunity, the writ petition was dismissed, but the assessee was allowed to challenge the order through the appeal process.
✔️ Delhi HC – Pankaj Polymers v. Commissioner of CGST, Delhi North [W.P. (C) No. 7286 of 2025]
🔥📛 Bank accounts to be de-freezed as order to freeze bank accounts stands automatically stayed upon stay of final order in appeal: HC
➡️ The assessee filed an urgent petition challenging the freezing of their bank accounts.
➡️ The court was later informed that an appeal against the original freezing order had been filed and the accounts had already been restored.
➡️ The assessee reported that two additional bank accounts, opened under the same PAN, were also frozen by the banks.
➡️ Since the appeal on the original order was pending and a stay on the final order was in place, the bank was directed to immediately unfreeze all the assessee’s accounts.
➡️ The department was instructed to officially communicate the unfreezing of the accounts to all relevant parties.
✔️ Delhi HC – Unity Traders v. Principal Additional Director-DGGI [W.P.(C) 7239 of 2025]
