LATEST GST CASE LAWS: 24.07.2026
🔥📛 SC to examine whether limitation u/s Sec. 74(2) for SCN issuance is mandatory; Stays original orders
➡️ The Supreme Court has issued notice in an SLP challenging the Telangana High Court’s ruling that the six-month notice period under Section 74(2) of the CGST Act is directory rather than mandatory.
➡️ The key issue is whether issuing a show cause notice at least six months before the deadline for passing the adjudication order is a jurisdictional requirement or merely a procedural timeline.
➡️ The assessee argues that limitation provisions in tax laws determine the authority’s jurisdiction and cannot be diluted merely because the statute does not expressly state the consequence of non-compliance.
➡️ Divergent High Court decisions on the mandatory nature of Section 74(2) were cited, highlighting the need for authoritative clarification by the Supreme Court.
➡️ Pending further hearing on September 28, 2026, the Supreme Court has stayed the Telangana High Court judgment and the Orders-in-Original concerning FYs 2021-22, 2022-23 and 2023-24.
✔️ SC – Bengal Cold Rollers Private Limited vs The Assistant Commissioner (ST), Basheerbagh- Nampally-1 Circle & Ors [Writ Petition (Civil) No. 836/2026]
🔥📛 Madras HC to examine invocation of Section-78 proviso for recovery within three months of order
➡️ The Madras High Court considered a writ petition challenging coercive recovery proceedings initiated nearly three months before the adjudication order under the CGST Act.
➡️ The Revenue relied on the proviso to Section 78 to begin recovery before expiry of the normal statutory period, claiming that tax collections would be used for public welfare.
➡️ The assessee argued that this justification was generic and that the proviso had been invoked mechanically, without recording any exceptional facts requiring immediate recovery.
➡️ The Court questioned whether a broad public-welfare rationale, by itself, could justify expedited recovery and held that the legality of such invocation required further examination.
➡️ While issuing notice and staying the recovery proceedings, the Court observed that the proviso is meant for exceptional cases, such as a real risk of funds being siphoned off or assets being transferred to defeat recovery of government dues.
✔️ Madras HC – UNIVERSAL ENTERPRISES VS DEPUTY COMMISSIONER (ST) AND 2 OTHERS.
🔥📛 Bombay HC flags non-compliance pattern with refund orders; Mulls 18% interest, salary recovery from officials
➡️ The Bombay High Court expressed concern over the recurring practice of departmental authorities withholding GST refunds even after the Revenue’s appeals have been dismissed and no proceedings are pending before a higher court.
➡️ In the present matter, the Department failed to comply with the Court’s order dated December 9, 2025, directing refund of ₹7.2 crore with applicable interest within ten days of uploading the order, and provided no satisfactory explanation for the delay.
➡️ The Court observed that taxpayers are being unnecessarily forced to initiate fresh litigation for refunds that should be granted automatically under binding departmental circulars and concluded proceedings.
➡️ To address such unjustified non-compliance, the Court required the Revenue to explain why additional interest at 18% should not be imposed from the date the refund order became enforceable until the amount is actually paid.
➡️ The Court also directed the Department to explain why the additional interest should not be recovered personally from the salaries and wages of the officials responsible, warning that consequential orders may follow if the response is unsatisfactory.
✔️ Bombay HC – M. A. Agro (Proprietor Mr. Ashfak Jafar Shekhani) vs Deputy Commissioner of State Tax Sanpada 501 & Ors. [WRIT PETITION NO. 15764 OF 2025]
🔥📛 Madras HC to examine statutory basis for late fee on belated GSTR-9C filing; Stays recovery
➡️ The Madras High Court issued notice in a writ petition challenging the levy of late fee for delayed filing of the reconciliation statement in Form GSTR-9C.
➡️ The assessment order was contested only to the extent that it imposed late fee for belated filing of GSTR-9C, while the notification authorising the levy was challenged separately.
➡️ The Court observed that the GST statutory framework appears, at first sight, to contain a gap because no specific provision expressly empowers authorities to levy late fee for delayed filing of GSTR-9C.
➡️ Based on this prima facie view, the Court granted an interim stay on the portion of the assessment order relating to the late fee, without disturbing the remaining parts of the order.
➡️ The matter has been tagged with the connected challenge and listed for further hearing on August 28, 2026, leaving the final legality of the levy open for determination.
✔️ Madras HC – MGM Transports vs The Assistant Commissioner (ST) (FAC) & Ors [W.P. Nos. 25969 and 25973 of 2026]
🔥📛 Madras HC to examine Section 122 proper-officer issue and Commissioner’s order foreclosing statutory appeal
➡️ The Madras High Court issued notices and stayed the penalty imposed under Section 122(1)(vii) of the CGST Act until the next hearing.
➡️ The assessee challenged the jurisdiction of the Joint Director, DGGI, arguing that the show-cause notice was issued before CBIC Circular No. 254/11/2025-GST assigned proper-officer powers for proceedings under Section 122.
➡️ According to the assessee, the later assignment of powers could not cure the jurisdictional defect in proceedings initiated by an officer who lacked authority when the notice was issued.
➡️ The assessee also argued that Section 107 read with Rule 109A of the CGST Rules provides no effective appellate forum against an order passed by the Commissioner (In-Situ), as the rule covers appeals against orders of Additional or Joint Commissioners.
➡️ By granting interim protection, the Court recognised that both the authority to initiate penalty proceedings and the availability of a workable statutory appeal required judicial examination; the matter is listed for August 31, 2026.
✔️ Madras HC – Me-Hin Tech Edge Solutions vs Union of India & Ors [WP Nos. 26314 & 26320 of 2026]
🔥📛 Madras HC to examine leasehold rights assignment taxability post-Supreme Court order; Permits bank-account operations
➡️ The Madras High Court considered a writ petition challenging a 2024 GST demand on the ground that assignment of leasehold rights does not constitute a taxable “supply” under the GST laws.
➡️ The Court noted the Supreme Court’s recent dismissal of the Revenue’s SLP against the Gujarat High Court ruling in Gujarat Chambers, and the Revenue fairly accepted that the legal issue may be covered by that decision, though factual verification would still be required.
➡️ For interim relief, the Court found that the assessee had established a prima facie case that assignment of leasehold rights may fall outside the scope of taxable supply under GST.
➡️ Recovery had already been initiated under Section 79(1)(c), with banks directed to debit the disputed tax, interest and penalty, while debit-freeze instructions effectively prevented the assessee from operating its accounts.
➡️ The Court directed that the lien would continue only to the extent of the disputed tax, excluding interest and penalty, and allowed the assessee to operate its bank accounts, thereby granting partial protection from coercive recovery pending disposal of the writ petition.
✔️ Madras HC – PAN Electronics India Limited vs The State Tax Officer
🔥📛 GSTAT: Statutory disclosure of manufacturer details on packages not ‘brand name’; Institutional supplies outside ‘pre-packaged ’ ambit
➡️ GSTAT Thane Bench dismissed the Revenue’s appeals and upheld the dropping of GST demand of ₹2.2 crore, along with interest and an equivalent penalty, on supplies of frozen poultry products to institutional consumers.
➡️ For the period before July 18, 2022, the Tribunal held that printing the manufacturer’s corporate name and address on packaging, solely to comply with food safety and legal metrology laws, does not amount to affixing a registered brand name under Notification No. 02/2017-CT(R).
➡️ The Tribunal clarified that statutory disclosures meant for product traceability and consumer safety cannot be treated as branding unless they indicate a commercial connection intended to enhance the product’s market value; therefore, removal of the “Godrej Tyson” and “Godrej Real Good” logos preserved the exemption.
➡️ For the period from July 18, 2022, GSTAT held that bulk packages supplied to institutional consumers are excluded from the definition of “pre-packaged commodities” under Rule 3 of the Legal Metrology (Packaged Commodities) Rules, 2011, and therefore do not become “pre-packaged and labelled” goods merely because statutory particulars appear on the packages.
➡️ The presence of a brand name on invoices does not make the goods branded when the packages themselves do not bear that brand; relying on RDB Textiles, Tarai Foods and Narasus Sarathy Enterprises, the Tribunal concluded that the exemption conditions were satisfied.
✔️ GSTAT Thane Bench – The Commissioner, CGST & Central Excise Vs Godrej Tyson Foods Limited [APL/4/THN/2026]
🔥📛 HC: Common portal not notified for notices/orders service; Upload on www.gst.gov.in not valid service
➡️ The Punjab & Haryana High Court held that merely uploading a show-cause notice or order on www.gst.gov.in does not amount to valid service under Section 169 of the CGST Act, 2017, because the portal has not been specifically notified under Section 146 for serving such notices or orders.
➡️ Although Section 169(1)(d) permits service through the common portal, such service requires a specific notification under Section 146. The notifications issued so far cover functions such as registration, tax payment, return filing, e-way bills and invoice preparation, but none authorise the GST portal for service of notices or orders.
➡️ An email merely informing a taxpayer that a notice or order has been uploaded on the portal is also insufficient service under Section 169(1)(c) when the actual document or its contents are not attached or reproduced in the email.
➡️ The Court reiterated that when a statute prescribes a particular method for performing an act, that method must be followed strictly. Therefore, in the absence of the required statutory notification, portal upload cannot replace a legally recognised mode of service or deprive taxpayers of their right to respond or appeal.
➡️ Criticising the portal’s difficult navigation as a “treasure hunt,” the Court urged GST authorities to create a clearer service mechanism through prominent dashboard alerts, mandatory pop-ups, OTP-based acknowledgements, automated SMS alerts and a dedicated section for statutory communications, so that digital compliance does not become a procedural trap.
✔️ P&H HC – Luxmi Traders & Ors. v. Union Territory of Chandigarh & Ors. [CWP – 27139-2025]
🔥📛 HC: Registration cancellation cannot rest on grounds alien to SCN; Restores GSTIN
➡️ The Telangana High Court quashed the cancellation of the GST registration because the final order relied on a ground that was not mentioned in the show cause notice.
➡️ The show cause notice issued in Form GST REG-17 proposed cancellation under Section 29(2)(e), alleging that registration had been obtained through fraud, wilful misstatement, or suppression of facts.
➡️ However, the cancellation order in Form GST REG-19 was based on a different allegation—that the assessee had failed to file GST returns from January 1, 2023 onwards.
➡️ The Court held that a GST registration cannot be cancelled on a ground for which the assessee was never given notice or an effective opportunity to respond, as this violates the principles of natural justice.
➡️ The Court restored the GST registration but allowed the Revenue to begin fresh cancellation proceedings by issuing a clear show cause notice specifying the proposed grounds and supporting material.
✔️ Telangana HC – JK Technology vs Deputy State Tax Officer [WRIT PETITION No. 21690 of 2026]
🔥📛 HC: Restores GST registration cancellation proceedings to SCN stage citing denial of opportunity to file returns
➡️ The Karnataka High Court quashed the orders cancelling the assessee’s GST registration for non-filing of returns for FY 2021-22 and rejecting the revocation application as time-barred.
➡️ The Court held that the assessee should be given a meaningful opportunity to file the pending returns, after which the tax authorities could verify compliance and determine the assessee’s legal obligations.
➡️ It observed that cancellation of GST registration could completely disrupt the assessee’s business and should not be sustained without first considering whether the default could be rectified through filing of returns.
➡️ The Court noted the assessee’s claim that, for another tax period, similar cancellation proceedings had been dropped after returns were filed, and that the same opportunity could have demonstrated its bona fides in the present case.
➡️ Since both impugned orders were passed without considering the assessee’s possible explanation, the matter was restored to the show-cause notice stage, permitting a response by July 13, 2026, subject to payment of costs of ₹25,000 by that date.
✔️ Karnataka HC – Jesu Navin Nishchal Vs Assistant Commissioner of Commercial Taxes [WRIT PETITION NO. 15265 OF 2026 (T-RES)]
🔥📛 HC: Quashes Section 73 order for failure to furnish SCN despite formal request
➡️ The Karnataka High Court partly allowed the assessee’s writ petition and quashed the Order-in-Original passed under Section 73(2) of the Finance Act, 1994.
➡️ The Court held that failure to provide the Show Cause Notice, despite a formal written request by the assessee, was a procedural irregularity that denied a reasonable opportunity to respond.
➡️ It noted that proceedings concerning the same tax period in a connected matter had earlier been remanded on similar grounds, supporting consistent treatment.
➡️ Although repeated opportunities to an unresponsive noticee may frustrate the adjudicating authority, the order could not stand because there was no evidence that the assessee had ignored a duly served notice.
➡️ The matter was restored to the adjudicating authority with directions to furnish the Show Cause Notice and permit the assessee to file a detailed reply before fresh adjudication.
✔️ Karnataka HC – Shri. Narasimhalu Naidu Vs Additional Commissioner of Central Tax [WRIT PETITION NO. 17693 OF 2026 (T-RES)]
🔥📛 SC: Declines to examine university affiliation-fee exemption issue; Leaves issue open pending Madras HC decision
➡️ The Madras High Court’s Division Bench held that affiliation and inspection fees collected by a university from affiliated colleges are taxable under GST because these services are distinct from the admission of students and the conduct of examinations.
➡️ The Court explained that affiliation is a prior regulatory process based on statutory requirements such as infrastructure, faculty and permitted student strength; therefore, it cannot be treated as a service relating to admission or examination merely because affiliation is necessary before students can be admitted.
➡️ Although universities qualify as educational institutions, the exemption under Notification No. 12/2017-Central Tax (Rate) is limited to specified services relating to admission and examination, and does not extend to every service supplied by a university, including affiliation and inspection activities.
➡️ After considering conflicting High Court rulings, the Division Bench preferred the view taken in the Pondicherry University case, answered the reference against Bharathidasan University and remanded the writ petitions to the Single Judge for determination of the remaining grounds.
➡️ The Supreme Court declined to decide the GST issue at the present stage because the matter remained pending before the Single Judge, while preserving the university’s right to challenge both the final order and the Division Bench ruling later; it also clarified that dismissal of an earlier Revenue SLP against a contrary Karnataka High Court decision did not affirm that decision or create a binding precedent.
✔️ SC – Bharathidasan University vs The Joint Commissioner of GST (ST-Intelligence) Trichy Division & Anr [Petition(s) for Special Leave to Appeal (C) No(s).17945-17948/2026]
