LATEST GST CASE LAWS: 20.09.2025
🔥📛 Calcutta HC to examine Rule-88B proviso disallowing ECL adjustment against interest liability for delayed filing
➡️ The Royal Calcutta Golf Club contested an Appellate Authority order requiring payment of interest on the entire tax liability, including portions already paid in cash.
➡️ The Calcutta High Court noted that the Appellate Tribunal under GST is yet to be constituted, leaving taxpayers without an effective appellate remedy.
➡️ The Court examined the Proviso to Rule 88B of the CGST Rules, 2017 (as amended), which restricts interest liability to net cash payments, aligning with the taxpayer’s contention.
➡️ While the 53rd GST Council meeting recommendations formed the basis of the amendment, Revenue argued that the proviso applies only prospectively and offers no relief for prior periods.
➡️ Observing a prima facie case and balance of convenience in favor of the taxpayer, the Court stayed the impugned interest demand and directed the exchange of affidavits for further proceedings.
✔️ Calcutta HC – Royal Calcutta Golf Club v. Senior Joint Commissioner of State Tax, Behala Circle, Kolkata & ors. [WPA 22906 of 2024]
🔥📛 HC: AAR not binding on distinct GSTIN or businesses under same name; Quashes non-speaking order
➡️ The Court clarified that an Advance Ruling under Section 103 of the GST Act applies only to the applicant and its jurisdictional officers. Hence, the ruling in Gulab Singh Chouhan could not be automatically applied to the petitioner, who had a distinct GST registration and independent business entity.
➡️ The adjudicating authority erred in mechanically applying the Gulab Singh AAR ruling to the petitioner, instead of independently assessing the petitioner’s eligibility under the GST law.
➡️ Revenue argued that as the petitioner’s firm was a sister concern of the Karnawat Paan group operating under a common brand, the AAR ruling against Gulab Singh should bind the petitioner. The Court rejected this stance, reiterating the legal individuality of GST registrations.
➡️ The demand order imposing ₹64.89 lakh (tax, interest, and penalty) was found to be a non-speaking order, since it merely stated that the petitioner’s reply was “not satisfactory” without any reasoned analysis.
➡️ Setting aside the impugned order, the Court remanded the matter to the Assistant Commissioner of State Tax, Indore Circle-I, directing a fresh, independent adjudication of the show cause notice on merits, uninfluenced by any external advance ruling.
✔️ Madhya Pradesh HC – Mahendra Singh v. Assistant Commissioner State Tax & Ors. [WRIT PETITION No. 5186 of 2025]
🔥📛 GSTAT: State’s cinema-ticket price cap not a profiteering license; Orders Mallikarjuna Cinema to deposit
➡️ GSTAT upheld DGAP’s findings that Mallikarjuna Cinema profiteered (₹16.50 lakhs) by raising base ticket prices despite GST rate reductions (28% → 18% → 12%). The respondent’s own admission that ticket prices were not reduced commensurately was treated as clear proof of profiteering.
➡️ The plea that ticket prices were fixed under State rules and upheld by Telangana HC was dismissed. GSTAT clarified that while the Cinemas Act and Government orders prescribe maximum ticket prices, theatre owners retain discretion within that limit, and GST benefits must still be passed on.
➡️ The Rs. 3/- maintenance charge per ticket was held to form part of the taxable value, and its separate collection could not justify non-passing of GST rate reduction.
➡️ Referring to Reckitt Benckiser, GSTAT reiterated that business or commercial considerations cannot override the statutory duty under Section 171 to pass on tax benefits to consumers.
➡️ Applying the ratio in Procter & Gamble, GSTAT held that interest @18% under Rule 133(3)(c) is prospective from June 28, 2019. Thus, only 3 days of the investigation period fell within its ambit, and interest applies accordingly. The profiteered amount with limited interest must be deposited into Consumer Welfare Funds within one month.
✔️ GSTAT Delhi – DGAP Vs. Mallikarjuna Cinema Hall, 70MM Hyderabad [NAPA/3/PB/2025]
🔥📛 HC: Basis classification-issue dealt by AAAR, Section 74 SCN invoking extended-period on same issue unsustainable
➡️ Since the assessee had approached AAR in January 2020 disclosing all material facts regarding GMAT Type-III tests, the Court held Revenue was fully aware of the transaction; therefore, the sine qua non of “wilful suppression” under Section 74 was not met.
➡️ The Court clarified that Section 74 cannot be invoked for mere non-payment of tax, incorrect classification, or wrong disclosure in returns unless accompanied by deliberate intent to evade.
➡️ The classification of GMAT Type-III tests (OIDAR or not) was itself in dispute, with AAR and AAAR taking conflicting stands and the issue still pending before the High Court. In such interpretative uncertainty, alleging suppression or misstatement was held unsustainable.
➡️ Revenue’s reliance on Neminath Fabrics was rejected, with the HC clarifying that the precedent applies only where suppression is established or admitted—conditions absent in this case.
➡️ Given Revenue’s prior knowledge, absence of mens rea, and pending adjudication on classification, the SCN issued under extended limitation was quashed. The Court emphasized that allegations of wilful suppression were illegal, arbitrary, and contrary to law.
✔️ Karnataka HC – NCS Pearson Inc. Vs Union Of India & Ors [WRIT PETITION NO. 7635 OF 2024 (T-RES)]
🔥📛 HC: Quashes ‘staggered’ refund processing ; Recognizes adjudicatory powers of the Appellate-Authority u/s 107(11), permits- de-novo adjudication
➡️ The assessee challenged four Orders-in-Appeal (OIAs) on refund rejections of unutilised ITC, highlighting inconsistent findings: services to Chegg Inc., USA were rejected as non-export in some cases, while partial refund was granted in another on identical facts.
➡️ The refund claim related to software development, content development, and IT/ITES services in the EdTech sector provided exclusively to the overseas parent company; Revenue denied classification as ‘export of services.’
➡️ HC reiterated, citing Sonu Monu Telecom, that under Section 107(11) CGST Act, the Appellate Authority can examine matters on merits afresh, including admitting documents not considered by the original authority.
➡️ HC criticized the staggered disposal of refund applications, which led to contradictory and irreconcilable outcomes, stressing that all refund claims should be considered comprehensively in one go.
➡️ The High Court set aside the refund rejections and remanded the matter to the Appellate Authority for fresh adjudication, with clear powers to confirm, modify, or annul orders to ensure consistent treatment.
✔️ Delhi HC – Chegg India Private Limited vs. Assistant Commissioner, CGST [W.P.(C) 11718/2025]
🔥📛 HC: No embargo for non-consideration of reply against composite SCN ‘afresh’ under Section 107(11)
➡️ The Court clarified that the Appellate Authority can confirm, modify, or annul the adjudication order, which includes examining the assessee’s reply, evidence, and reasoning afresh, making it a full-fledged first appeal.
➡️ The assessee argued that only the Adjudicating Authority could consider their SCN reply under Section 74(9). The Court rejected this, holding that appellate review extends to the entire matter, including the reply filed before adjudication.
➡️ The only restriction is that the Appellate Authority cannot remand the matter back to the Adjudicating Authority. This ensures finality and avoids repetitive reconsideration.
➡️ Since the SCN contained detailed computation for multiple financial years (2017-18 to 2019-20), the Court upheld its validity as a consolidated notice and did not find fault in clubbing different periods.
➡️ The Court relied on the Its My Name decision, affirming that the expressions “confirm, modify, or annul” must be interpreted broadly, giving appellate authorities wide latitude to decide the appeal on merits.
✔️ Delhi HC – Sonu Monu Telecom Pvt. Ltd. Through its Director Jitender Garg & ANR vs. UOI [W.P.(C) 2926/2025]
🔥📛 HC: Uploading of orders in GSTN-portal not “communication”; Limitation for appeal filing begins upon effective communication
➡️ The Court clarified that the appeal period begins only when an adjudication order is effectively communicated through recognized modes (post, courier, or direct tender), not merely from the date of uploading on the GST portal.
➡️ Section 107 specifically uses the term communicated, which the Court held to be a bipartite act requiring actual transmission to the assessee, unlike unilateral portal uploads that do not constitute valid communication.
➡️ The Court emphasized that the statute obliges the department to communicate orders; there is no statutory obligation on taxpayers to keep checking the GST portal for uploaded orders.
➡️ While Revenue relied on Pandidorai Sethupathi Raja (uploading valid service), the Court preferred the line of reasoning in Shahul Hameed and Namasivaya Auto Cars that uploading alone is insufficient, aligning this with SC rulings on fairness (Madhukar Kumar), discretion (Techno Prints), and practical interpretation (Southern Electricity Supply).
➡️ Since the impugned orders were only downloaded recently by the assessee and had never been communicated per law, the Court held they cannot be enforced until properly served. The officer was directed to duly communicate the orders afresh.
✔️ Madras HC – Sharp Tanks and Structurals Private Limited Vs The Deputy Commissioner (GST) (Appeals) and Ors [W.P.(MD)Nos. 24684 & 24685 of 2025]
🔥📛 HC: Bunching adjudicatory proceedings for multiple assessment-years impermissible; Follows Madras-HC
➡️ The Andhra Pradesh High Court held that a single show cause notice or composite assessment order cannot cover more than one financial year or tax period under GST law.
➡️ While Delhi and Bombay HCs earlier allowed composite orders across years, Karnataka, Kerala, and Madras HCs disallowed them. AP HC aligned with Madras HC, interpreting “any period” in Section 73(3) as linked to “such tax period” in Section 73(4).
➡️ The Court reasoned that the Delhi HC in Ambika Traders had not examined the interplay between Section 73(3) and 73(4). It held the Madras HC’s approach—restricting assessment to specific tax periods—to be the correct interpretation.
➡️ The Court emphasized that permitting composite orders would prejudice the assessee’s statutory rights, including filing separate appeals under Sections 73/74 and availing penalty waiver under Section 128.
➡️ The impugned composite orders were set aside, but the Revenue was given liberty to initiate fresh proceedings for each tax period separately, in compliance with law.
✔️ Andhra Pradesh HC – S J Constructions Vs The Assistant Commissioner and Others [WRIT PETITION Nos: 11028, 11206, 17671 & 20792 of 2025]
🔥📛 HC: Quashing Section-74 proceedings, rebukes dealer’s ‘harassment’ under guise of fraud to invoke extended-period
➡️ The Court reiterated that Section 74 of the CGST Act is applicable only when fraud, wilful misstatement, or suppression of facts with intent to evade tax is established; mere suspicion or reliance on unverified intelligence cannot justify invoking this provision.
➡️ Relying on Continental Foundation (SC), the Court stressed that “suppression” and “wilful misstatement” under fiscal statutes necessarily involve mens rea; absence of intent to evade tax makes Section 74 inapplicable.
➡️ The Revenue’s denial of ITC based solely on an intelligence report, without sharing the material or recording findings of fraud/misstatement, was held to contravene principles of natural justice.
➡️ The assessee’s reliance on invoices, e-way bills, transporter documents, banking transactions, and GSTN returns substantiated the genuineness of purchases, countering Revenue’s contention that supplier irregularities justified ITC denial.
➡️ Referring to CBIC Circular (13.12.2023) and earlier ruling in Khurja Scrap Trading Co., the Court observed that Section 74 should not be misused to harass dealers, reaffirming that GST was designed to promote ease of business, not create procedural hardships.
✔️ Allahabad HC – Safecon Lifescience Private Limited Vs Additional Commissioner Grade 2 And Another [WRIT TAX No. – 389 of 2023]
