LATEST GST CASE LAWS: 20.02.2026
🔥📛 Technical glitch in ICEGATE cannot compel interest on IGST payment contrary to adjudication order
➡️ The Bombay High Court (Goa Bench) granted relief to JSW Steel after the Assessee was compelled to pay IGST interest due to an ICEGATE technical glitch, holding that such automated computation cannot override a categorical Order-in-Original that refrained from imposing interest.
➡️ Relying on its prior ruling in Larsen and Toubro Ltd and the Supreme Court’s decision in Shah Nanji Nagsi Exports, the Court reiterated that substantive taxpayer rights cannot be defeated by system errors, noting with concern that authorities failed to rectify ICEGATE issues despite earlier judicial directions and expired deadlines.
➡️ The Assessee’s challenge to reassessment of Bills of Entry and its request for rectification under Section 154 were supported by reliance on the Order-in-Original, which had applied the principle from Mahindra and Mahindra (affirmed by the Supreme Court of India) that interest or penalties on duties not intrinsically linked to basic customs duty require explicit statutory authority.
➡️ The Revenue acknowledged the glitch and admitted the absence of any mechanism to manually correct it, suggesting payment of interest followed by refund, and also pointed to pending departmental appeals; the Court rejected this stance, holding that pendency of appeal cannot justify non-implementation of the binding Order-in-Original.
➡️ To provide a practical remedy, the Court directed that IGST be paid via demand draft and be treated as if paid through ICEGATE, ensuring that all consequential legal benefits accrue to the Assessee, while instructing authorities to extend such benefits promptly upon receipt of payment.
✔️ Bombay HC (Goa Bench) – JSW Steel Limited v. Union of India & Ors. [WRIT PETITION NO. 12 OF 2026]
🔥📛 Madras HC quashes order relying on AAR-ruling qua another Assessee in ‘saumf’ classification matter
➡️ The Madras High Court set aside a demand order where the Revenue reclassified the assessee’s product “saumf” at a higher GST rate, noting that while classification disputes fall within the statutory GST adjudication framework, High Court intervention under Article 226 is limited as such matters are appealable under the CGST Act.
➡️ The Court clarified that the Revenue’s reliance on an Advance Ruling issued for a different assessee was legally untenable, as Section 103 of the CGST Act makes Advance Rulings binding only on the applicant and their jurisdictional officer, giving them no precedential force over unrelated taxpayers.
➡️ It emphasized that, although an Advance Ruling may have persuasive value, adjudicating authorities must independently assess the facts, classification, and tax treatment rather than mechanically adopting conclusions rendered for another entity.
➡️ The Court further held that Circular No. 163/19/2021-GST could not justify the impugned order, reiterating that circulars are not binding on assessees or constitutional courts, cannot override statutory provisions, and cannot substitute proper adjudication under the GST law.
➡️ Because the impugned order was influenced by an unrelated Advance Ruling and the cited circular, the Court quashed it and remanded the matter for fresh adjudication on the merits, directing the authority to decide the classification dispute independently and without external, non-binding influences.
✔️ Madras HC – A.V. Enterprises vs The Assistant Commissioner of Central Excise and CGST
🔥📛 Madras HC to examine GST exemption on collection of toll charges; Grants interim-stay
➡️ The Madras High Court granted interim relief by staying the levy and recovery of GST on toll charges, noting that the assessee’s challenge raised a substantial question regarding the correct interpretation of the applicable exemption.
➡️ The assessee argued that toll payments constitute consideration for access to a road or bridge and therefore fall squarely within Entry 23 of Notification No. 12/2017–Central Tax (Rate), which exempts services related to access to roads/bridges on payment of toll.
➡️ It was further contended that similar writ petitions on the same issue had already received interim protection, supporting the credibility and consistency of the assessee’s claim before the Court.
➡️ After hearing both sides, the Court examined the language and scope of Entry 23 and found a strong prima facie basis to accept that toll-related collections may indeed qualify as exempt supplies under the said notification.
➡️ Consequently, the Court stayed the impugned GST demand and directed the Revenue to file its counter-affidavit within four weeks, leaving the substantive issue open for further adjudication.
✔️ Madras HC – INDERDEEP CONSTRUCTION COMPANY, VS THE ASSISTANT COMMISSIONER (ST)
🔥📛 Madras HC grants interim relief to Britannia on same-month ISD transfer & tax-head mismatch
➡️ The Madras High Court granted an unconditional stay in favour of Britannia Industries Ltd against a substantial GST demand arising from a multi-year SCN, noting that the primary dispute concerned the alleged obligation to distribute Input Service Distributor (ISD) credit within the same month under Rule 39(1)(a).
➡️ On the ISD issue, the Court held the demand to be prima facie unsustainable because the Rule itself had already been struck down by the Telangana High Court, and hence any coercive recovery based on that provision could not stand at this stage.
➡️ The Court therefore stayed the ISD-related demand—approximately ₹80 crore—while also noting that a Division Bench of the Madras High Court is presently examining the constitutional validity of the same rule in a similar challenge.
➡️ Regarding the alleged tax-head mismatch, the Court reaffirmed that input tax credit is an indefeasible right except where goods or services are not actually received, and that procedural or technical lapses such as incorrect tax-head reporting cannot justify denial of credit.
➡️ While finding this mismatch-based demand prima facie unsustainable, the Court directed the assessee to make a 10% pre-deposit of the disputed amount within six weeks, following which interim protection from recovery would continue.
✔️ Madras HC – BRITANNIA INDUSTRIES LIMITED VS OFFICE OF THE PRINCIPAL COMMISSIONER OF CGST AND CENTRAL EXCISE
🔥📛 HC: Allows videography & Advocate’s presence during summons, citing Assessee’s health, willingness to cooperate
➡️ The Bombay High Court held that, given the assessee’s medical condition (ongoing cancer treatment) and demonstrated willingness to cooperate, limited safeguards were justified in summons proceedings under Section 70 of the Central Goods and Services Tax Act, 2017, including videography of the inquiry and limited presence of counsel.
➡️ The assessee, representing the company under investigation, challenged the manner of summons-based inquiry concerning alleged irregular ITC claims on purchases from Zes Stock Enterprises and New Era Enterprises, whose GST registrations had been cancelled though appeals were stated to be pending.
➡️ It was contended that all transactions were bona fide, backed by valid tax invoices, reflected in GSTR-2B, and paid through banking channels, and therefore the assessee requested videography of statement-recording at its own cost along with permission for its advocate to remain present during the inquiry.
➡️ The Revenue argued that no additional safeguards were required because the premises were already under CCTV surveillance and that extending further protections during Section 70 proceedings was unwarranted; however, the Court noted the absence of prejudice in granting the limited safeguards sought.
➡️ Relying on the coordinate-bench ruling in Suumaya Industries Ltd., where similar safeguards were permitted on consent, the Court directed videography of the statements at the assessee’s cost and allowed an advocate to remain at a visible but not audible distance, while clarifying that the order was confined to the peculiar facts and would not operate as a precedent.
✔️ Bombay HC – Tuesonpower International Pvt. Ltd. & Anr. v. Union of India & Anr. [WRIT PETITION (L) NO. 40917 OF 2025]
🔥📛 HC: Reaffirms prohibition on clubbing multiple years in SCN; Follows Milroc, Rite Water
➡️ The Bombay High Court (Nagpur Bench) held that a single Section 74 notice cannot consolidate multiple financial years, reiterating that GST assessments and recoveries must be year-specific, with independent limitation periods triggered by each year’s annual return due date.
➡️ Distinguishing the Delhi High Court ruling in Mathur Polymers, the Court clarified that a dismissal of an SLP in limine by the Supreme Court of India does not create merger nor dilute binding precedent within the State, reinforcing the autonomy and applicability of its own earlier decisions.
➡️ Reaffirming its rulings in Milroc Good Earth Developers and Rite Water Solutions (India) Ltd., the Court emphasized that aggregation of years in a single SCN violates the statutory framework of Sections 73(10) and 74(10) and prejudices taxpayers by obscuring year-wise allegations and timelines.
➡️ Rejecting reliance on the Andhra Pradesh High Court decision in Sahiti Agencies, the Bench noted that mere issuance of notice by the Supreme Court does not suspend or override existing binding precedent, and criticised Revenue for failing to consider the broader body of High Court jurisprudence before advancing its position.
➡️ While partly allowing the petition, the Court set aside the impugned order and granted liberty to the Revenue to issue fresh notices strictly in line with Section 74, subject to legal permissibility, acknowledging the possibility of future challenges to its earlier rulings before the Supreme Court.
✔️ Bombay HC – M G Wadhwani Vs Union of India & Ors. [WRIT PETITION NO. 3902/2025]
🔥📛 HC: Article 265 governs application for refund of tax paid twice; Section-54 limitation not applicable
➡️ The Orissa High Court held that when an assessee seeks refund of tax paid under a mistaken belief—such as depositing the same liability twice—the claim falls within the constitutional mandate of Article 265 rather than Section 54 of the GST Act, making statutory limitation under Section 54 inapplicable.
➡️ The Court set aside the rejection order in Form GST RFD-06, observing that denial of refund solely on limitation grounds is impermissible where the payment itself was an erroneous or duplicate deposit, and clarified that Explanation 2(h) to Section 54(1) cannot be invoked in such cases.
➡️ Recognising that the assessee had discharged the same CGST and OGST liability twice—first through the Credit Ledger (Feb 2021) and again through the Cash Ledger via Form GST DRC-03 (Sept 2022)—the Court found the Proper Officer’s reliance on limitation to reject the refund as “completely untenable.”
➡️ The judgment emphasizes that when excess or mistaken payments are made, authorities must apply the constitutional bar on retaining tax without authority of law under Article 265, rather than mechanically applying Section 54 timelines, aligning with principles laid down in earlier decisions such as Delhi Metro Rail Corporation Ltd., Comsol Energy, and ITC Ltd.
➡️ Allowing the writ, the Court permitted the assessee to file a fresh refund application within 15 days, directed the department to decide it within 7 days of receipt, and ordered that failure to do so would render the refund liable to 6% interest from the date of the original refund application until actual payment.
✔️ Orissa HC – Rajendra Narayan Mohanty Vs Joint Commissioner of State Tax [W.P.(C) No. 2271 of 2026]
