LATEST GST CASE LAWS: 22.11.2025
🔥📛 Delhi HC quashes mechanical cancellation of boAt’s registration; Imposes cost for Revenue’s ‘cavalier’ approach
➡️ The Delhi High Court found the cancellation order, rejection of revocation, and the appellate order to be perverse, templated, and passed without application of mind, lacking any proper reasoning or justification.
➡️ The initial SCN alleging the Assessee was “non-existent” contained no substantive grounds and only vague statements, despite granting 30 days for response—making the notice legally deficient.
➡️ Despite the Assessee submitting timely and detailed replies twice (including GST returns, lease deeds, and supporting documents), the authorities rejected them mechanically with no discussion or evaluation—amounting to violation of natural justice.
➡️ The appellate authority also failed to examine the evidence already on record and indexed in the appeal, repeating the same error and reinforcing the lack of due adjudication.
➡️ The High Court restored the GST registration, directed fresh adjudication of the original SCN considering the already-filed replies, and imposed ₹25,000 costs on the State/superintendent for arbitrary action.
✔️ Delhi HC – Imagine Marketing Limited. Vs Joint Commissioner, CGST APPEALS II and Anr [W.P.(C) 17699/2025]
🔥📛 SC to examine validity of Central’s parallel SCN when State’s proceedings close without adjudication
➡️ The Assessee argued that a second show cause notice (SCN) issued by Central GST authorities was barred because the State GST authorities had already issued a prior SCN on the same subject matter, invoking Section 6(2)(b) of the CGST Act (bar on parallel proceedings).
➡️ The High Court held that since the State GST SCN was closed without adjudication—meaning no assessment, penalty, demand, or recovery order was issued—the bar under Section 6(2)(b) did not apply.
➡️ The Court noted that the Central GST authorities had already conducted inspection and issued a payment memo demanding approx. ₹120 Crores before the State authority’s SCN. Therefore, the Central authority’s proceedings were not treated as secondary or parallel.
➡️ Based on the above reasoning, the High Court directed the Assessee to respond to the Central GST SCN and allowed the investigation to continue.
➡️ Before the Supreme Court, the Assessee argued that the High Court’s reasoning contradicted the Supreme Court ruling in Armour Security on parallel GST proceedings. After hearing submissions, the Supreme Court issued notice, agreeing to examine the matter.
✔️ SC – South Eastern Coalfields Limited Vs. Principal Commissioner [SLP(C) No. 33124/2025]
🔥📛 Madras HC hears batch pleas against Section 74 SCNs/orders issued allegedly without ‘jurisdictional foundation’
➡️ The assessee contends that once the DGGI Vadodara unit had already investigated the relevant period, examined contractual documents, and issued a show cause notice (SCN), a fresh proceeding by DGGI Chennai under Section 74 for the same period constitutes jurisdictional overreach and is impermissible in law.
➡️ The initiation of proceedings under Section 74—requiring fraud, suppression, wilful misstatement, etc.—is challenged as arbitrary. The assessee argues that the Chennai unit is attempting to invoke Section 74 only to avoid the expiry of the normal limitation period under Section 73, amounting to a colourable exercise of statutory power.
➡️ The phrase “where it appears” in Section 74 carries the same legal weight as “reason to believe” or “satisfaction of the authority,” requiring objective evaluation of relevant material. The assessee asserts that such mandatory formation of opinion is absent, rendering the SCNs and consequential orders without legal foundation.
➡️ While courts ordinarily refrain from interfering at the SCN stage, intervention is justified where proceedings are ex facie without jurisdiction, based on irrelevant considerations, or issued in violation of statutory preconditions—making the writ petition maintainable.
➡️ Invoking the extended limitation under Section 74, which has civil and quasi-criminal consequences, requires strict compliance with constitutional safeguards under Article 265. Absent cogent material evidence demonstrating fraud or suppression, the extended period cannot be lawfully applied.
✔️ Madras HC – Siemens Gamesa Renewable Energy Power Pvt. Ltd. v. Additional Director
🔥📛 HC: Allowing ITC on stock & premises insurance, quashes demand premised on misclassification as motor insurance
➡️ The Revenue denied ITC by incorrectly treating the assessee’s insurance policies as motor vehicle insurance, invoking Section 17(5)(b) of the CGST Act, despite the documents clearly showing the policies covered stock-in-trade and business premises.
➡️ The Court clarified that blocked credit under Section 17(5)(b) is limited to cases involving motor vehicle-related expenses. Since the policy covered plant, equipment, and stock—not vehicles—the provision was wrongly applied.
➡️ The adjudicating authority failed to consider valid insurance policy documents provided in response to the Show Cause Notice and in DRC-06, resulting in an arbitrary confirmation of demand.
➡️ Even though the appeal period had expired, the High Court entertained the writ petition on the ground that the order suffered from a jurisdictional error, as the department acted beyond statutory authority.
➡️ The High Court quashed the DRC-07 demand order and consequential bank attachment, holding that the Revenue had no authority to disallow ITC where the insurance policy did not relate to motor vehicles.
✔️ Gujarat HC – Arraycom (India) Limited vs. State of Gujarat & Ors. [R/SPECIAL CIVIL APPLICATION NO. 11979 of 2025]
🔥📛 HC: Natural justice not a straitjacket, requires clear showing of prejudice; Imposes costs
➡️ The Court held that the petition challenging GST registration cancellation was frivolous and unsupported by credible evidence, noting false and contradictory statements made by the assessee on affidavit.
➡️ The Court rejected the plea of breach of natural justice as misconceived, emphasizing that natural justice is not a rigid formula and that actual prejudice must be demonstrated—none was shown in this case.
➡️ Despite the assessee’s denial, records showed he was present during site verification and made a statement admitting he only ran a small stationery shop and had no connection with the registered entity (M/s Digital Storm).
➡️ The assessee’s request to condone delay on the ground of “unstable mental condition” was rejected for lack of supporting documentary evidence.
➡️ The SCN specifically cited fraudulent registration obtained through suppression and misrepresentation. Hence, procedural objections could not invalidate a cancellation order based on substantive fraud.
✔️ Bombay HC – Digital Storm (Prop: Lokhamsi Popat Darji) vs. Superintendent of CGST & Ors. [WRIT PETITION NO. 748 OF 2025]
🔥📛 HC: Flags systemic lapses in online notice service and resulting loss of appeal rights; Remands matter
➡️ The Court quashed the GST adjudication order of approx. ₹1.61 lakh noting that no valid show cause notice (SCN) was served, and no opportunity for reply or personal hearing was provided, rendering the order legally unsustainable.
➡️ The Court held that mere uploading of notices or orders on the GST portal without proper alerts does not constitute valid service, especially when key dates (reply, personal hearing, service of order) are absent or disputed.
➡️ The Bench observed that hundreds of similar writ petitions reflect systemic challenges faced by taxpayers in receiving notices and orders on the GST portal, leading to unintended procedural consequences.
➡️ The Court noted that strict limitation periods for filing appeals—combined with the lack of appellate remand powers—often result in taxpayers losing their statutory right to appeal due to such procedural lapses.
➡️ The adjudication order was set aside subject to the assessee depositing ₹16,000. The authority was directed to serve the SCN with relied-upon documents, grant at least two weeks’ notice for personal hearing, and complete proceedings within six months.
✔️ Allahabad HC – Riya Construction Vs State Of U.P. And 3 Others [WRIT TAX No. – 3964 of 2025]
🔥📛 HC: Allahabad HC quashes GST registration cancellation issued through system-generated notice without authority’s name or designation
➡️ The Court held that cancellation powers under GST law rest with designated officers, and notices generated solely by the system without identifying an issuing authority are invalid.
➡️ The impugned notice merely stated “Jurisdictional Officer System Generated Notice” and failed to mention the name, office, or designation of the issuing authority, rendering it legally defective.
➡️ The Court clarified that advisory allowing undigitally signed notices cannot justify notices that omit the identity of the issuing officer.
➡️ A notice must contain essential legal attributes—including identifiable issuing authority—to be considered valid and enforceable under law.
➡️ The Court set aside both the defective notice and the resulting cancellation order, while allowing Revenue the liberty to issue a fresh, legally compliant notice.
✔️ Allahabad HC – M Y Ent Bhatta Vs. State of UP & Anr. [WRIT TAX No. – 546 of 2025]
🔥📛 HC: Parallel proceedings bar not attracted when state proceedings close without adjudication, allows Central’s SCN to proceed
➡️ The Chhattisgarh High Court upheld the legality of the proceedings initiated by the CGST authorities under Section 73, even though the SGST authorities had earlier issued a notice in Form DRC-01.
➡️ The SGST authorities issued Form DRC-01 without first issuing DRC-01A (pre-notice intimation) and subsequently closed the case without adjudication, assessment, penalty, or demand proceedings under Sections 73 or 74.
➡️ The Court clarified that Section 6(2)(b) bars parallel proceedings only when adjudication or demand and recovery proceedings under Sections 73 or 74 have actually been initiated. Mere issuance of DRC-01 without further adjudication does not trigger the bar.
➡️ Although the SGST authorities lacked jurisdiction to proceed on the same cause of action as the ongoing CGST inquiry, the absence of final adjudication by State authorities meant the Central proceedings remained lawful.
➡️ The High Court dismissed the assessee’s claim that the CGST notice was barred due to prior proceedings by SGST and affirmed the Single Judge order, allowing the CGST demand (approx. ₹120 crore under RCM for Development and Environment Cess) to proceed.
✔️ Chhattisgarh HC – South Eastern Coalfields Limited vs Principal Commissioner, CGST [WA No. 494 of 2023]
