LATEST GST CASE LAWS: 19.06.2025
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🔥📛 Mere availing of IGST credit under CGST and SGST does not constitute wrong availment of ITC: HC ➡️ The assessee was found to have utilised input tax credit (ITC) in excess by availing IGST credit under CGST and SGST heads, leading to a liability under section 73. ➡️ An order of assessment was passed against the assessee, who then filed an appeal before the appellate authority. ➡️ Meanwhile, the Kerala High Court in the case of Rejimon Padickapparambil Alex v. Union of India observed that the electronic credit ledger functions like a wallet with separate compartments for IGST, CGST, and SGST, and using IGST credit under CGST and SGST heads does not amount to wrongful availment of ITC. ➡️ The assessee argued that this judicial principle applied to their case as well. ➡️ The court held that while the pending appeal prevented interference with the assessment order, the appellate authority was directed to decide the appeal promptly within four weeks, considering the impact of the Kerala HC judgment. ✔️ Kerala HC – Grand Hyundai v. State Tax Officer [WP(C) NO. 499 OF 2025] |
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🔥📛 Matter to be re-adjudicated as assessee responded to SCN yet lacked fair opportunity to be heard: HC ➡️ The assessee received a Show Cause Notice (SCN) and subsequent demand order for the period July 2017 to March 2018 and submitted a reply to the SCN. ➡️ The assessee did not attend the personal hearing granted by the Adjudicating Authority. ➡️ Since the assessee was not given a proper opportunity to be heard, the case was remanded back for re-adjudication. ➡️ The assessee contested the validity of CBIC Notification No. 9/2023-Central Tax dated 31-03-2023, which relates to the limitation period for extending the time to raise demand. ➡️ The challenge to the CBIC Notification is subject to the outcome of the Supreme Court’s pending decision on the matter. ✔️ Delhi HC – Bee Sons Traders v. Commissioner Delhi Goods and Service Tax [W.P. (C) No. 6066 OF 2025] |
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🔥📛 Mere non-issuance of show cause notice does not prejudice assessee but failure to issue specific notice warrants admission of SLP: SC ➡️ The case pertains to the demand for the period 2017-18 where the assessee challenged the issuance of a summary show cause notice along with the complete audit report after an audit was conducted. ➡️ The assessee argued that since a detailed reply was filed in response to the summary notice, mere non-issuance of a formal show cause notice did not cause any prejudice. ➡️ The High Court held that serving a summary show cause notice with the audit report was sufficient and the assessee had an opportunity to contest. ➡️ However, it was found that no specific notice under Section 73(1) or 74(1) of the CGST Act was actually issued to the assessee. ➡️ Consequently, the Supreme Court agreed to admit the Special Leave Petition (SLP) and directed that no recovery action should be taken until the matter is finally decided. ✔️ SC – Saluja Motors (P.) Ltd. v. State of Himachal Pradesh [SLP(C) NO(S). 14145 of 2025]
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🔥📛 GST reimbursement claim on post-GST contract cannot be denied by applying clause meant for pre-GST contracts: HC ➡️ The petitioner, a government contractor, paid additional GST on gross bills for the period from July 1, 2017, to March 31, 2019, due to a regime change but was denied reimbursement by the authorities. ➡️ The petitioner argued that the relevant Notification No. 5050-F(Y) dated August 16, 2017, specifically paragraph 3(iv), applies only to pre-GST contracts and cannot be used to deny GST reimbursement for contracts executed after July 1, 2017. ➡️ The petitioner further contended that denial of reimbursement was arbitrary, unreasonable, and discriminatory, violating Article 14 of the Constitution. ➡️ The authority was found to have misunderstood the notification’s applicability, incorrectly applying paragraph 3(iv) to post-GST contracts instead of paragraph 4, which governs contracts after July 1, 2017. ➡️ The Secretary of the Public Works Department was directed to reconsider the petitioner’s claim for GST reimbursement, provide a reasoned order, and offer an opportunity for hearing, given that the petitioner had already paid the GST amount from their own funds. ✔️ Calcutta HC – Pinki Construction v. Executive Engineer, North Bengal Development Department [W.P.A No. 875 of 2022]
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