LATEST GST CASE LAWS: 23.07.2025
🔥📛 Gujarat HC to ascertain point of taxation w.r.t mobilization-advance paid by NHAI to contractors
➡️ The Gujarat High Court is set to determine whether mobilization advances paid by NHAI to road contractors attract GST immediately upon receipt or only at the time they are adjusted against invoices for actual work performed.
➡️ The petitioner has contested the Appellate Authority for Advance Ruling’s (AAAR) classification of mobilization advances as consideration subject to GST at the time of receipt, alleging failure to consider the proviso to Section 2(31) of the CGST Act, 2017.
➡️ The case hinges on whether a mobilization advance qualifies as “consideration” under GST law. The petitioner argues that without a corresponding supply of goods or services, the advance should not be treated as taxable at receipt.
➡️ The petitioner asserts that since the mobilization advance is interest-bearing, it functions more like a loan or deposit, and therefore, GST liability should arise only upon its actual utilization against billed work.
➡️ Taking into account the petitioner’s arguments, the High Court has issued notice to the concerned parties, with the matter scheduled for further hearing on 21st August 2025.
✔️ Gujarat HC – SPS Construction India Pvt Ltd vs Union of India and Others [R/SPECIAL CIVIL APPLICATION NO. 9604 of 2025]
🔥📛 SC: Dismisses Revenue’s SLP challenging HC judgment quashing demand on CERC/DERC’s license fee
➡️ The Delhi High Court held that the Central and Delhi Electricity Regulatory Commissions (CERC and DERC) perform statutory and quasi-judicial functions, including the issuance of licenses, akin to a tribunal and not as commercial entities.
➡️ It was clarified that fees collected for issuing licenses are part of the Commission’s statutory duty and not consideration for any business or commercial service under GST law.
➡️ Since the activity of granting licenses is a statutory mandate, it falls outside the scope of “supply” under GST, thereby rendering the related fees non-taxable.
➡️ The High Court quashed the GST demand raised by the Revenue on license fees, concluding that these do not constitute a taxable supply of service under the CGST Act.
➡️ The Supreme Court found no merit in the Revenue’s Special Leave Petitions (SLPs) and dismissed them, effectively affirming the Delhi HC’s interpretation and reinforcing the non-taxability of such statutory functions.
✔️ SC – Additional Director Directorate General Of GST Intelligence (DGGI) & Anr Vs Central Electricity Regulatory Commission [SPECIAL LEAVE PETITION (CIVIL) Diary No. 32626/2025]
🔥📛 HC: Quashes IGST on expat salary; Secondment by Alstom Transport India not ‘manpower services’
➡️ The Karnataka High Court held that secondment of expatriate employees by the foreign parent to the Indian entity does not attract GST, as it constitutes an employer-employee relationship, not a supply of manpower services. Hence, the impugned demand by the Revenue was quashed.
➡️ Drawing from the Supreme Court’s decision in Northern Operating Systems (NoS), the Court emphasized evaluating who controls the employee, bears the cost, and dictates the employment terms. Where the Indian company has full control and bears salary expenses, the arrangement does not qualify as a taxable inter-state service.
➡️ The Court reiterated that services provided by an employee to an employer in the course of employment fall under Schedule III of the CGST Act—treated as neither a supply of goods nor services—thus outside the GST net in such secondment arrangements.
➡️ The HC referenced CBIC Circular No. 210/4/2024-GST, which clarifies that secondment arrangements should not automatically be deemed as supply. The Court viewed this Circular as binding on the tax authorities and instrumental in neutralizing presumptions of tax liability in genuine employer-employee arrangements.
➡️ Relying on the Delhi High Court’s Metal One Corporation ruling, the HC held that in the absence of a raised invoice, and with full input tax credit (ITC) available, the second proviso to Rule 28 cannot override the Schedule III exclusion. Therefore, a ‘Nil’ taxable value is legally sustainable.
✔️ Kerala HC – Alstom Transport India Ltd. vs. Commissioner of Commercial Taxes & Ors. [WRIT PETITION NO.1779 OF 2025 (T-RES)]
🔥📛 HC slams fresh proceedings on same issue for same period instead of rectifying errors, if any in earlier order
➡️ Fresh proceedings under Section 73 of the CGST Act cannot be initiated for the same period and issue already covered by a previously passed adjudication order in Form GST DRC-07.
➡️ The assessee had already challenged the earlier adverse order for the same period (April 2020 to March 2021) before the Appellate Authority, and that matter was sub judice.
➡️ If there was an apparent error in the earlier order, the appropriate remedy for the department was rectification under Section 161 of the CGST Act—not initiation of a new demand proceeding.
➡️ The issuance of a new summary order under Form GST DRC-07 for the same issue and period was not legally sustainable and was therefore wrongly passed.
➡️ The Appellate Commissioner has broad powers to adjudicate and consolidate such overlapping issues and must consider the assessee’s submissions fully before passing a final order.
✔️ Madras HC – JR Enterprises v. State Tax Officer [W.P (MD) No. 18365 of 2025]
🔥📛 HC modified order cancelling GST registration with retrospective effect as assessee filed application for cancellation
➡️ The assessee applied for cancellation of GST registration on 28-03-2022. Under Rule 21A(2A) of the CGST Rules, any clarification regarding such application must be sought within 30 days. In this case, the department issued a clarification notice after more than two years, rendering the process legally defective.
➡️ The cancellation application was subsequently rejected by the department despite the procedural lapse. This rejection lacked merit, as the delay in seeking clarification violated the prescribed legal timeframe.
➡️ Later, a show cause notice (SCN) was issued to cancel the registration on the grounds of non-filing of returns for six months, leading to a retrospective cancellation from 01-07-2017. However, the assessee had already applied for cancellation, which nullified the rationale behind demanding further compliance.
➡️ The Court held that once the assessee applied for cancellation of registration, no obligation to file returns thereafter remained. Thus, initiating cancellation proceedings based on non-filing post-application was legally untenable.
➡️ The Court modified the cancellation order to reflect that the effective date of GST registration cancellation should be the date of application—28-03-2022, correcting the earlier retrospective application from 2017.
✔️ Delhi HC – Banglore Sales Corporation v. Commissioner of DGST [W.P.(C) No. 9001 of 2025]
🔥📛 SCN and order for FY 2020–21 held within time as GSTR-9 due date stood extended to 28-2-2022 via Rule 80(1A):HC
➡️ The normal deadline for filing GSTR-9 under Section 44 is 31st December following the end of the financial year. However, Rule 80(1A), inserted w.e.f. 29-12-2021, extended the due date for FY 2020–21 to 28-02-2022. This extension was held valid for computing limitation under Section 73.
➡️ A show-cause notice issued on 28-10-2024 was challenged for being premature due to non-filing of GSTR-9. However, the court held that in light of the extended filing deadline (28-02-2022), the SCN was issued within the permissible period and was therefore legally valid.
➡️ The adjudication order dated 20-02-2025 was found to be within the 3-year limitation period prescribed under Section 73(10), reckoned from the extended due date for GSTR-9 filing. Hence, the order was not time-barred.
➡️ The petitioner’s argument that no SCN could be issued before filing of GSTR-9 was rejected. The court held that the existence or absence of the return did not invalidate the jurisdiction of the proper officer to issue SCN once the extended timelines were considered.
➡️ As the impugned order under Section 73(9) was passed within limitation and no jurisdictional infirmity was found, the court ruled that the petitioner should pursue the statutory appellate remedy rather than invoking writ jurisdiction.
✔️ Calcutta HC – Somenath Ghosh v. State of West Bengal [WPA No. 31087 of 2024]
