LATEST GST CASE LAWS: 27.01.2026
🔥📛 Sustains refund on exported education services; Grants 2-month extension to Revenue for refund processing
➡️ The SC dismissed the Revenue’s SLP, thereby affirming the Delhi High Court’s ruling that Global Opportunities Pvt. Ltd. is not an “intermediary” under Section 2(13) of the IGST Act.
➡️ Both the HC and SC accepted that the consultancy services provided to foreign universities are rendered on a principal-to-principal basis and therefore qualify as export of services, eligible for GST refund.
➡️ The HC had emphasized that the assessee does not arrange or facilitate the supply of services between the universities and students; instead, it provides direct, independent services, ruling out intermediary classification.
➡️ The HC noted that the GST Council’s recommendation to omit Section 13(8)(b) supports the position that intermediary services should not be artificially assigned the supplier’s location as the place of supply.
➡️ While dismissing the Revenue’s challenge, the SC granted the Revenue two months’ additional time to process the refund along with statutory interest.
✔️ SC – COMMISSIONER OF DELHI GOODS AND SERVICE TAX DGST DELHI Versus GLOBAL OPPORTUNITIES PRIVATE LIMITED [SLP(C) No. 2752/2026]
🔥📛 Bombay HC stays Rs. 10,000 crore+ GST demand on co-insurance/reinsurance transactions
➡️ The Bombay High Court has stayed adjudication orders confirming substantial GST demands against 13 major insurance companies concerning co-insurance premiums and ceding commissions.
➡️ Assessees argued that the demands contradict CBIC Circulars dated 11 Oct 2024 and 28 Jan 2025, issued pursuant to GST Council decisions, which expressly exclude co-insurance premium and ceding commission from GST and regularise past periods on an “as-is-where-is” basis.
➡️ The petitioners highlighted that identical demands had already been dropped by GST authorities in Meerut, Delhi, Pune, and Mumbai in line with these Circulars, making the impugned orders a clear departure from established departmental interpretation.
➡️ Since the GST Council is impleaded, the Court directed Revenue to place on record all previously dropped orders to assess consistency and legality of the present demands.
➡️ Observing a prima facie case in favour of the assessees, the High Court ordered an ad-interim stay on all impugned orders until the next hearing scheduled on 18 February 2026 at 3:00 p.m.
✔️ Bombay HC – Aditya Birla Health Insurance Co. Ltd & Ors vs Union of India and others [WRIT PETITION NO. 17706 OF 2025]
🔥📛 Bombay-HC grants interim relief to Mad Over Donuts against item-wise classification at 18% and 5%
➡️ The Bombay High Court granted interim relief to Himesh Foods Pvt. Ltd. (Mad Over Donuts), staying the adjudication order issued while their writ petition against a Section 74 CGST notice was still pending.
➡️ The dispute concerns the Revenue’s item-wise classification of the assessee’s products—taxing some items at 18% and others at 5%—instead of treating the offerings uniformly for the relevant period.
➡️ Despite the writ petition challenging the SCN being sub judice, the Revenue proceeded with adjudication, prompting the assessee to amend its writ to include a challenge to the adjudication order as well.
➡️ The assessee relied on an earlier coordinate Bench ruling in Hindustan Coca Cola Beverages Pvt. Ltd., where identical issues were admitted and interim protection was granted; the High Court accepted the parity argument.
➡️ Recognizing the legal controversy and to ensure consistent treatment across similar matters, the Court stayed the adjudication order until disposal of the writ petition and listed the matter for final hearing on February 26, 2026, along with companion cases.
✔️ Bombay HC – Himesh Foods Pvt. Ltd. v. Union of India [WRIT PETITION NO. 718 OF 2025]
🔥📛 HC: Interest on refunded IGST on ‘ocean freight’ runs from ‘deposit date’ despite Section-56 silence
➡️ The High Court held that once the Supreme Court in Mohit Minerals struck down the Notifications levying IGST on ocean freight as unconstitutional, the assessee became entitled to interest on the refunded amount from the date of deposit, since the levy itself was illegal.
➡️ The Court clarified that this refund does not arise from a statutory refund mechanism under Section 54 of the CGST Act. Instead, it arises from the invalidation of the levy itself; therefore, the Revenue’s reliance on the 60-day timeline under Section 56 to deny interest was held inappropriate.
➡️ Since the IGST payment towards ocean freight was made under protest and the levy was later declared unconstitutional, the State cannot retain such amounts without compensating the assessee for the period of retention—hence, interest is mandatory.
➡️ Even though Section 56 is silent on interest for refunds arising from unconstitutional taxes, the Court applied established jurisprudence holding that interest must be awarded where tax is collected illegally or without authority of law.
➡️ The High Court criticised the Revenue for completely ignoring the Court’s earlier directions and focusing only on Section 54 procedures. It held that once the underlying notifications are declared ultra vires, the normal refund adjudication framework cannot override the constitutional right to restitution with interest.
✔️ Orissa HC – Paradeep Phosphates Limited Vs Additional Commissioner Goods and Services Tax (Appeals) [W.P.(C) No. 11618 of 2024]
🔥📛 HC: No limitation scrutiny required for admissibility of IGST refund on ocean freight
➡️ Gujarat HC held that once the Supreme Court in Mohit Minerals struck down the IGST levy on ocean freight, the Revenue cannot reject refund claims on technical grounds such as limitation.
➡️ The HC set aside the appellate order that remanded the matter for verification of limitation, stating that such observations were unwarranted given the settled legal position.
➡️ Since the Assessee paid IGST on CIF imports under Entry 10 of Notification 10/2017-IGST (Rate), later declared unconstitutional in Mohit Minerals, the refund claim filed under Section 54 was legally valid.
➡️ The Court noted that the adjudicating authority issued an undated SCN without mentioning any personal hearing date, rendering the refund rejection order unsustainable.
➡️ Considering the settled law and repeated remands, the HC declined further remand and directed the Revenue to grant the refund with 6% interest within 12 weeks.
✔️ Gujarat HC – Indian Potash Limited vs The Union of India [R/SPECIAL CIVIL APPLICATION NO. 11004 of 2024]
🔥📛 HC: Partial refund post-amalgamation impermissible due to registration lapses and incomplete ITC transfer
➡️ The HC upheld the appellate authority’s reversal of refund orders granted to the transferee (Alstom Transport India Ltd.), holding that the refund of unutilised ITC must comply strictly with statutory provisions under Section 54(3) and Rule 41 (ITC transfer through FORM GST ITC-02).
➡️ The Court noted that ATIL obtained retrospective registration even before it legally came into existence under Section 25. Since liability to register arises only after the NCLT order and RoC certification, the application filed earlier was held to be contrary to the statute.
➡️ ARTIPL’s registration should have been cancelled effective the date the entity ceased to exist (per NCLT order). The HC held that continuing registration post-amalgamation and conducting transactions, including refund claims, violated GST law.
➡️ The Court criticized the transfer of only part of the transferor’s unutilised ITC via FORM GST ITC-02 prior to the effective amalgamation date. Since the entity ceased to exist only after NCLT approval, any pre-order ITC transfer or refund claim lacked legal validity.
➡️ The HC found that the transferee (ATIL), transferor (ARTIPL), and jurisdictional officers all disregarded mandatory provisions on registration, cancellation, and ITC transfer. The Court directed strict adherence to the statutory process to prevent similar disputes in future.
✔️ Gujarat HC – Alstom Transport India Limited v. Additional Commissioner, CGST & Central Excise (Appeals) & Ors. [R/SPECIAL CIVIL APPLICATION NO. 11025 of 2025]
🔥📛 Limitation issue pending before SC; impugned demand quashed and matter remanded for fresh decision: HC
➡️ A show cause notice under Section 73 was issued for FY 2018-19 alleging excess ITC claimed in GSTR-3B compared to GSTR-2A; no reply was filed by the taxpayer, leading to an ex-parte adjudication order confirming tax, interest, and penalty.
➡️ The petitioner argued that the notices went unnoticed, resulting in no response, and further contended that the adjudication proceedings were barred by the statutory limitation under Section 73.
➡️ The department relied on Notification Nos. 09/2023 and 56/2023 to assert that the limitation period for issuing orders under Section 73 stood extended, and therefore the proceedings were validly initiated.
➡️ The High Court noted that the constitutional validity of these limitation-extension notifications is already under examination by the Supreme Court in HCC-SEW-Meil-AAG JV v. Asstt. CST (2025) 174 taxmann.com 1080 (SC), and the outcome will directly impact the present matter.
➡️ To avoid parallel or inconsistent proceedings, the High Court set aside the ex-parte order and remanded the case for fresh consideration after the Supreme Court decides on the validity of the limitation-extension notifications.
✔️ Karnataka HC – Bangalore Matics (P.) Ltd. v. Union of India [Writ Petition No. 38494 OF 2025 (T-RES)]
🔥📛 Notwithstanding finding of no illegality in arrest proceedings, writ Court cannot release accused showing mercy or sympathy: HC
➡️ The Supreme Court in Radhika Agarwal v. Union of India held that provisions of the Cr.P.C., including mandatory issuance of a Section 41A Cr.P.C. notice, apply to arrests made under the GST Act.
➡️ The Supreme Court clarified that High Courts may grant bail in writ jurisdiction only in exceptional circumstances, particularly where the very initiation of criminal proceedings is under challenge and no prima facie allegations exist.
➡️ Interim bail can be granted by High Courts only in rare and extraordinary situations, and only after ensuring all statutory procedures have been complied with.
➡️ Courts cannot routinely review or question reasons for arrest; these can be interfered with only where there is clear, evident non-application of mind.
➡️ In the present case, the facts did not meet the threshold for extraordinary intervention. Petitioners were therefore directed to seek bail before the competent court, rather than through a writ petition.
✔️ Karnataka HC – E. Ishitha v. Assistant Commissioner of Commercial Taxes [WRIT PETITION No. 23 OF 2026 (GM – RES)]
🔥📛 SLP disposed of; bail granted despite allegations of fake ITC via 44 proxy firms, leaving factual issues to trial court
➡️ The accused was alleged to have created 44 non-existent/proxy firms and generated goods-less invoices to pass on fraudulent ITC amounting to approximately ₹315.3 crore, causing significant loss to the revenue.
➡️ The High Court denied bail, noting that the defence raised factual issues meant for trial and emphasizing that economic offences of such magnitude warrant a stricter approach to bail.
➡️ The Supreme Court observed that despite the seriousness of the allegations, the accused had already spent over eight months in judicial custody, and the trial had not commenced nor had charges been framed.
➡️ The Court noted that even if the trial began, it was unlikely to conclude within a year, and that the alleged offences—triable by a Magistrate—carry a maximum imprisonment of up to five years.
➡️ Taking these factors into account, the Supreme Court exercised its discretion to grant bail, directing that the accused be released subject to conditions determined by the Trial Court, and disposed of the SLP accordingly.
✔️ SC – Amit Mehra v. Union of India [SLP Appeal (Crl.) No. 20996 OF 2025]
