This weekly round-up analytically summarizes the key stories related to the Supreme Court and High Court reported at Taxscan.in during the previous week 22nd February 2025 to 28th February 2025)
In a recent judgment, the Supreme Court of India affirmed that the concerned Commissioner of the Goods and Services Tax (GST) Department may authorize the arrest of an individual booked for offences under specific provisions of Section 132 of the Income Tax Act, 1961 without a formal assessment Order, provided that the relevant reasons and evidences have been established to a ‘degree of certainty’.
Dismissing the petition, the Supreme Court held that Agarwal’s arrest was legally sustainable, given the Commissioner’s satisfaction that a cognizable offence had been committed. However, it emphasized that such arrests must not be made arbitrarily and must be backed by clear and compelling reasons recorded in writing.
The Supreme Court has delivered a major on the scope of arrest powers under the Goods and Services Tax (GST) Act and the Customs Act, affirming the applicability of procedural safeguards outlined in the Code of Criminal Procedure (now Bhartiya Nagrik Suraksha Sanhita, BNSS) to arrests made under these statutes.
The verdict was delivered by a bench comprising Chief Justice Sanjiv Khanna, Justice MM Sundresh, and Justice Bela M Trivedi, ruling on a batch of 279 petitions challenging penal provisions under the Customs Act, CGST/SGST Act, and their compatibility with the BNSS and the Constitution.
In a recent ruling, the Supreme Court dismissed a public interest litigation (PIL) seeking regulation of internet tariffs charged by telecom giants Jio and Airtel, stating that consumers have multiple options available in the market.
The PIL had named the Department of Telecommunications (DoT), the Telecom Regulatory Authority of India (TRAI), Reliance Jio, and Bharti Airtel as respondents. The petition’s dismissal comes amid ongoing discussions in the telecom sector regarding the frequency of tariff hikes.Industry leaders, including Vi CEO Akshaya Moondra, have justified recent increases, citing the need for returns on capital investments.
The Supreme Court of India has reserved its judgment in a matter regarding the legality of extending the time limit for the adjudication of a Goods and Services Tax (GST) Show Cause Notices (SCN) through notifications issued under Section 168A of the GST Act, 2017 observing differing opinions by State High Courts on the subject.
While recognizing that Section 168A was intended to address extraordinary circumstances, the Court acknowledged that various High Courts had interpreted its scope differently. Addressing the cleavage of opinion among different High Courts as mentioned by Senior Advocate S. Muralidhar for the Petitioner, the Bench directed the issuance of notice to the Respondents on the present SLP as well as the prayer for interim relief, with the matter to be returned on 07.03.2025.
Regarding tax recovery requests, the Supreme Court awarded PPK Newsclick Studio Pvt Ltd, the firm that operates the news portal NewsClick, a week’s temporary protection. The corporation was given permission to petition the High Court after the court dismissed its Article 32 plea.
In a plea filed by Newsclick against the Delhi High Court‘s decision to reject a stay on the income tax claim, the bench of Justices BV Nagarathna and Nongmeikapam Kotiswar Singh issued the aforementioned verdict. The Court published a notice in the SLP on July 8. On November 18, the Top Court ordered ICICI Bank to de-freeze the Agency’s bank accounts in accordance with the order dated August 9.
The Chhattisgarh High Court refused to grant bail for the accused who was arrested for the offence under the Prevention of Money Laundering Act, 2002 (“the PMLA”) as the prosecution has prima facie established the link between one of the accused in the coal scam. The court found the involvement of the applicant in commission of offence under Sections 7, 7A & 12 of the Prevention of Corruption Act, 1988 ( PC Act), which is economic offence.
The court found that it is not a fit case where the applicant should be granted regular bail and rejected the instant bail application filed under Section 483 of the Bhartiya Nagrik Suraksha Sanhita, 2023.
The Kerala High Court disposed of the writ petition directing the 2nd respondent to take appropriate steps to refund the amount deposited by the petitioner at the time of preferring the appeal after deducting the amounts due for the respective period as provided in Government orders.
The court disposed of the writ petition directing the 2nd respondent to take appropriate steps to refund the amount deposited by the petitioner at the time of preferring the appeal after deducting the amounts due for the respective period as provided in Government orders. The amounts shall be calculated and disbursed to the petitioner within a period of two months from the date of receipt of a copy of the judgment.
In a recent ruling, the Bombay High Court quashed an arbitrary notice issued seeking to reopen the assessment for Lupin Limited without any fresh evidence.
The court allowed the petition and set aside the reopening notice dated 31 March 2021 and the order dated 30 November 2021, which had rejected the company’s objections.
A writ petition contesting the denial of an application to compound all prior service tax through a one-time settlement was dismissed by a division bench of the Andhra Pradesh High Court composed of Justices R. Raghunandan Rao and Harinath. The bench held that a designated committee may reject an application for compounding tax over bogus documents under the Sabkha Vishwas (Legacy Dispute Resolution) Scheme 2019.
According to the court, the Designated Committee has the authority to reject applications that were submitted using forged documents. Any other opinion would imply that anyone seeking the program’s benefits might provide any type of paper, and the designated committee would not be allowed to investigate whether or not the document is authentic. Extreme circumstances would arise from such a viewpoint.
The Division bench of the Kerala High Court, which was composed of Justices A.K. Jayasankaran Nambiar and Easwaran S., declared that a show cause notice issued at the preliminary stage under Section 74 of the Central Goods and Service Tax (CGST) Act, 2017 cannot be challenged using writ authority under Article 226.
The court instructed the first respondent/assessee to appear before the adjudicating officer on 10.2.2025 and issue a further directive to the proper officer under Section 74 of the CGST Act/SGST Act to complete the hearing on 10.2.2025 itself and pass a composite final order on or before 15.2.2025, since the assessee had already been given notice to appear before the adjudicating authority/proper officer on that date.
In a recent ruling, the Delhi High Court quashed Rs. 2,000 crore income tax noticeby the Income Tax Department against Maruti Suzuki India Ltd. (the petitioner), holding that the reassessment notice was time-barred and based solely on a change of opinion rather than new or tangible information.
The court quashed the reassessment proceedings and the notice issued on April 1, 2016, holding that the notice was invalid and time-barred. The court confirmed that any action under Section 147 must be based on new and tangible information and not on a reassessment of previously disclosed facts. The writ petition was allowed.
The Allahabad High Court has ruled that the mere absence of an e-tax invoice due to a technical glitch in the Goods and Services Tax (GST) portal does not amount to tax evasion if all other transit documents are in place.
Consequently, the Bench quashed both the impugned orders while directing the authorities to refund the amount deposited by the petitioner within two months from the submission of a certified copy of the order.
The Chattisgarh High Court rejected the bail application against an offence registered under the Prevention of Money Laundering Act, 2002 and the Prevention of Corruption Act, 1988. The court’s rejection was due the the material evidence which shows active involvement of accused in the crime.
Considering the material evidence which shows the active involvement of applicant with the offence, the single bench of Justice Narendra Kumar Vyas viewed hat it is not a fit case where the applicant should be granted regular bail. The court rejected the instant bail application filed under Section 483 of the Bhartiya Nagrik Suraksha Sanhita, 2023.
The Chattisgarh High Court refused to grant bail under the Prevention of Money Laundering Act, 2002 (PMLA) on failure to fulfil the condition of section 45 of the act. It was found that the applicant has not prima facie reversed the burden of proof and dislodged the prosecution case which is mandatory requirement to get bail.
Since the applicant is unable to fulfill twin conditions for grant of bail as per Section 45 of the PMLA, 2002 and also considering the submission that the applicant has not prima facie reversed the burden of proof and dislodged the prosecution case which is mandatory requirement to get bail, the single bench of Justice Narendra Kumar Vyas refused to grant bail.
In a recent case on Oxford University Press, the Bombay High Court has ruled that unless the “jurisdictional parameters” of Section 148 of the Income Tax Act, 1961 are met, the mere fact that the tax rate that applies to an assessee increases in subsequent assessment years (AYs) does not serve as justification for initiating a reassessment action against it for prior AYs.
The court while allowing the appeal quashed the reassessment order passed against Oxford University Press, merely because its tax status was changed from ‘resident’ to ‘non-resident’, making it subject to a 40% tax rate instead of 30%.
In a recent ruling, the Madras High Court quashed GST (Goods and Services Tax) demand orders, terming them “ex parte.” The court observed that the taxpayer had voluntarily paid the GST liability before the issuance of the demand order, yet the authorities failed to provide an opportunity for a hearing. It was evident that the order was passed without considering the updated status of the case, leading to a violation of natural justice.
The court allowed the writ petition and emphasized that taxpayers must be given a fair opportunity to present their case before any demand orders are finalized.
The Madras High Court has set aside a GST ( Goods and Services Tax ) assessment order due to procedural lapses, including the belated upload of the show cause notice on the GST portal, which deprived the petitioner of a fair opportunity to respond. The case has been remanded for fresh consideration, subject to a pre-deposit condition.
Additionally, the bench directed the petitioner to file a reply with supporting documents within two weeks thereafter. The tax authorities are directed to issue a 14-day notice for a personal hearing before passing a fresh order in accordance with the law. Accordingly, the writ petition was allowed and the impugned GST demand order was set aside.
The Delhi High Court has dismissed a writ petition filed by a husband seeking an inquiry by the Income Tax Department into an alleged ₹2 crore cash transaction and other financial dealings by his estranged wife’s family.
While dismissing the Petition, the Delhi High Court commented that the petition has been lodged in terms of a matrimonial feud between the Petitioner and his wife (Respondent No.3) and concerns issued outside the jurisdiction of the Income Tax Department, the same not being under statutory scheme or a regulatory mechanism available under the Income Tax Act, 1961, thus the question of non-response to such complaint constituting violation of fundamental right or even a civil or statutory right of the petitioner is non-existent.
The Andhra Pradesh High Court has upheld the rejection of M/s Diwakar Road Lines’ application under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 (SVLDRS), ruling that the petitioner relied on an unauthorized tax notice issued by an official without jurisdiction.
The High Court ruled that the rejection of the petitioner’s SVLDRS application was justified. It stated that fraudulent or unauthorized documents could not be used to claim benefits under the scheme and that allowing such claims would set a dangerous precedent. The court dismissed the writ petition, stating that the petitioner was ineligible for relief under SVLDRS.
The Kerala High Court, in a recent ruling distinguished between the terms ‘Non-Service of Notice’ and ‘Lack of Knowledge of Service of Notice’ under Goods and Service Tax (GST).
It cannot be assumed that taxpayers have been effectively informed that the first notice regarding determination under section 73 or 74 of the GST Act will be uploaded only in the tab meant for “Additional Notices and Orders” if there are no specific notes or instructions provided on the same page meant for “Notices and Orders” or “Additional Notices and Orders.” The court observed that the petitioner was not given enough time to challenge the issue, nor was there any appropriate notice served.
In a recent ruling, the Allahabad High Court, Lucknow Bench, dismissed a writ petition filed by Mahendra Pratap Srivastava, popularly known as “Zoom Baba,” seeking to quash an FIR registered against him in connection with the Ruby Coin cryptocurrency fraud citing he was actively involved in inducing investors through online meetings.
The court held that there was no legal basis to quash the FIR, as it disclosed a cognizable offense that warranted further investigation. The High Court dismissed the writ petition.
Anticipatory bail has been granted by the Andhra Pradesh High Court in cybercrime instances involving UPI, benami, and hawala transactions. The court found that the the Cyber Crime Police, on credible information, commenced the investigation and crores of rupees with a number of bank accounts, UPI transactions including binami and hawala transactions was involved in the case.
The petitioner herein shall appear before the Station House Officer concerned one in a week 4 i.e. on every Saturday between 10.00 a.m. and 1.00 p.m., till filing of the charge sheet. 6. Accordingly, the Criminal Petition is allowed As a sequel thereto, the miscellaneous petitions, if any, pending in this Criminal Petition shall stand closed.”
The Kerala High Court stated that consolidated show cause notice involving multiple assessment years can be issued when a common period of adjudication exists.
While dismissing the appeal, the bench opined that a consolidated notice would also result in a consolidated adjudication order covering several financial/assessment years and in the event of it being adverse to the assessee, the fee/predeposit required to be paid by an assessee for preferring a statutory appeal would also be higher.
The Andhra Pradesh High Court has held that subsequent sale of liquor to customers not exigible to Value Added Tax ( VAT ) and set aside the assessment order dated 06.01.2022 and rectification order dated 25.02.2022 and remanding the matter back to the assessing authority to pass fresh assessment orders by excluding the turnover of Rs.4.54 crores arising out of sale of liquor from the turnover on which tax is levied.
The court allowed the writ petition partly allowed by setting aside the assessment order dated 06.01.2022 and rectification order dated 25.02.2022 and remanding the matter back to the assessing authority to pass fresh assessment orders by excluding the turnover of Rs.4.54 crores arising out of sale of liquor from the turnover on which tax is levied.
The Madras High Court recently quashed a GST demand order, citing procedural lapses and violations of natural justice. Even though the 50% disputed tax was deposited in the wrong head, the court noted severe procedural lapses in the matter.
The court also directed the petitioner to submit their objections and relevant documents within two weeks of making the pre-deposit. Upon receiving the reply, the GST authorities must provide a 14-day notice for a personal hearing before issuing a fresh order in accordance with the law.
The Delhi High Court has set aside a reassessment notice issued under Section 148 of the Income Tax Act, 1961, ruling that a notice issued in the name of a non-existent entity due to merger is legally invalid. The court held that the Assessing Officer (AO) failed to consider that the entity had ceased to exist post-amalgamation, making the reassessment proceedings void.
In its final ruling, the Delhi High Court Acting Chief Justice Swarna Kanta Sharma quashed the reassessment notice and set aside the proceedings, holding that the initial notice was issued to a non-existent entity, making the entire process legally invalid.
The Chhattisgarh High Court set aside the Income Tax department’s order demanding 20 % deposit amount for stay the demand of tax under section 156 of the Income Tax Act, 1961. It was viewed that the deposit of 20% of the disputed demand has been made condition precedent for hearing the application for stay which is not contemplated either under the Act of 1961 or the CBDT guidelines dated 29-22016 modified by the office memorandum dated 31-7-2017.
The court set aside the impugned order and remitted the matter to the competent authority to consider it afresh in light of the guidelines as stated above and pass a reasoned order within a period of 4 weeks from the date of receipt of the order.
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