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 8th February 2025 to 14th February 2025)
THE STATE OF MAHARASHTRA & ORS. vs PRISM CEMENT LIMITED & ANR CITATION: 2025 TAXSCAN (SC) 120
The Supreme Court held that even though after the amendment of Section 8(5) of the Central Sales Tax Act, the State Government’s right to grant exemption from tax has ceased to exist, the accrued right of assessees won’t affect. It would not apply to the cases where an absolute exemption has already been granted.
While dismissing the appeal, the Court viewed that the State Government was not justified in issuing the impugned notices and taking away the granted benefit. Further held that the requirement of submission of Form ‘C’ and ‘D’ would apply prospectively after 11.05.2002 i.e., after the Finance Act of 2002.
K. KRISHNAMURTHY vs THE DEPUTY COMMISSIONER OF INCOME TAX CITATION: 2025 TAXSCAN (HC) 232
The Supreme Court of India recently affirmed that the exception to penalty encompassed under Section 271AAA(2) of the Income Tax Act, 1961 shall be applicable if the Assessee has declared the undisclosed income only during the stage of assessment proceedings and not during search, even if requisite taxes were paid voluntarily.
A Division Bench of Justice J.B. Pardiwala and Justice Manmohan observed that the Appellant had only disclosed part of the income during search, while ₹2,49,90,000 was admitted later during assessment, justifying the penalty. Being so, the Apex Court clarified that the term ‘found in the course of search’ is of wide amplitude and includes subsequent recoveries linked to the search. Since the income in question was discovered through sale deeds obtained as a result of the search, it was rightly categorized as undisclosed. The Supreme Court disposed of the appeal levying a penalty of 10% on the ₹2,49,90,000 revealed during assessment proceedings.
VINUBHAI MOHANLAL DOBARIA vs CHIEF COMMISSIONER OF INCOME TAX & ANR CITATION: 2025 TAXSCAN (SC) 117
The Supreme Court has ruled that filing an Income Tax Return ( ITR ) after the due date but before prosecution does not eliminate liability for offenses under Section 276CC of the Income Tax Act, 1961.
The court clarified that the offense under Section 276CC is committed the day after the due date for filing the return expires, not on the date of belated filing. Since the offense for AY 2013-14 (committed on 01.11.2013) occurred before the show-cause notice for AY 2011-12 was issued (27.10.2014), both offenses should have been treated as a “first offense.” The appeal was disposed.
Thanushika vs The Principal Commissioner of Customs CITATION: 2025 TAXSCAN (HC) 215
In a recent ruling, the Madras High Court criticized the Chennai Customs Department for unlawfully seizing gold jewelry from a Sri Lankan citizen, including her Thaalikodi ( mangalsutra ), and directed the customs authorities to return the jewelry. The court ordered an inquiry into the misconduct of the seizing officer and explained that worn jewelry does not qualify as baggage under customs laws.
The court quashed the confiscation order and directed the immediate return of the seized gold within seven days. The court ordered an inquiry against the customs officer, S. Mythili, and directed the Principal Chief Commissioner of Customs ( Tamil Nadu & Puducherry ) to take disciplinary action. The matter was also referred to the Department of Personnel & Training (IRS-Customs) for further investigation.
M/S VISHAL VIDEO AND APPLIANCES PVT LTD vs COMMISSIONER OF CUSTOMS AC CITATION: 2025 TAXSCAN (HC) 217
The Delhi High Court has directed the Customs Department, the Central GST Department, the Directorate of Revenue Intelligence (DRI), and the Directorate of General GST Intelligence (DGGI) to make sure that counsel representing them on advance service are instructed properly.
Following this, the Customs Department, appearing in the matter, furnished a list of specific email addresses to which advance copies are to be served. The Court then directed its Registry to ensure that whenever cases relating to Customs and GST are filed before the Court, the advance copies are served at the relevant email addresses as mentioned in the list.
M/S ADDICHEM SPECIALLITY LLP vs SPECIAL COMMISSIONER I CITATION: 2025 TAXSCAN (HC) 219
In a recent ruling, the Delhi High Court ruled that the statutory timeline for filing an appeal, as provided under Section 107(1) and the additional one-month condonable period under Section 107(4), is absolute and cannot be extended.
The court held that the appeals were filed beyond the prescribed limitation period, so the Appellate Authority was correct in rejecting them. The court also held that the High Court’s extraordinary jurisdiction under Article 226 could not be used to extend statutory time limits and that strict adherence to tax laws is necessary to maintain compliance and administrative efficiency.
MAHALI ASSANAR AZEEZ vs THE INCOME TAX OFFICER CITATION: 2025 TAXSCAN (HC) 218
In a recent case, the Kerala High Court has observed that mere attempted compliance is not sufficient , but actual compliance is necessary under Direct Tax Vivad se Vishwas scheme and held that if the petitioner has, by now, remitted the full amount required to be remitted by the petitioner in terms of the provisions of the Direct Tax Vivad se Vishwas Act, 2020, the liability of the petitioner will be treated as settled.
A single bench of Justice Gopinath P while allowing the writ petition directed that if the petitioner has, by now, remitted the full amount required to be remitted by the petitioner in terms of the provisions of the Direct Tax Vivad se Vishwas Act, 2020, the liability of the petitioner for tax, penalty and interest for the assessment year 2009-2010 will be treated as settled and the petitioner will be eligible for all benefits under the Direct Tax Vivad se Vishwas Act, 2020.
ANJALI PANDEY vs UNION OF INDIA AND ORS CITATION: 2025 TAXSCAN (HC) 220
The Delhi High Court recently noted that 3 gold bangles would have been worn by the petitioner as a part of her personal effects, and there was no requirement to declare the same.
The judgement was concluded by Justice Prathiba M Singh and Justice Dharmesh Sharma by directing the Customs to follow this decision in all cases where jewellery is seized or detained from tourists of either Indian or foreign origin
PR. COMMISSIONER OF INCOME TAX -21 vs M/S.REMFRY & SAGAR CITATION: 2025 TAXSCAN (HC) 221
The Delhi High Court has upheld an order by the Income Tax Appellate Tribunal (ITAT) allowing the deduction of a license fee paid for the use of goodwill under Section 37 of the Income Tax Act, 1961.
The Delhi High Court, comprising Justice Yashwant Varma and Justice Ravinder Dudeja, dismissed the Revenue’s appeals, upholding the ITAT’s decision to allow the deduction of the license fee under Section 37 of the Income Tax Act.
THE CENTRE FOR MANAGEMENT DEVELOPMENT vs THE COMMISSIONER OF INCOME-TAX (EXEMPTIONS) CITATION: 2025 TAXSCAN (HC) 222
The High Court of Kerala sets aside the direction to pay the 20% assessed Income Tax as the assessee made stay applications/condonation of delay applications. While upholding the direction to the 1st respondent to dispose of the series of applications within a prescribed time, the court modified the latter part of the judgment of the Single Judge and directed that the 5th respondent shall consider the stay applications/delay condonation applications preferred by the appellant,
The recovery of the amounts confirmed against the appellant by the 6 assessment orders impugned in the appeals before the 5th respondent, shall be kept in abeyance till such time as orders are passed by the 5th respondent in the delay condonation applications/stay applications referred above.
KERALA MINERALS AND METALS LIMITED vs THE ADDITIONAL/JOINT/DEPUTY/ASSISTANT COMMISSIONER OF INCOME TAX CITATION: 2025 TAXSCAN (HC) 223
In a recent case, the Kerala High Court set aside the income tax order against Kerala Minerals and Metals as the department failed to give the opportunity of a hearing while passing the order.
In such circumstances, the court found that the impugned orders have been issued in violation of the principles of natural justice, entitling the petitioner to invoke the jurisdiction under Article 226 of the Constitution of India. The bench set aside the orders and the 3rd respondent Appellate Authority shall hear the matter afresh and pass appropriate orders in accordance with law, after granting an opportunity of hearing to the petitioner, as expeditiously as possible.
M/S Bhagwan Das Agrahari VS State Of U.P. And 2 Others CITATION: 2025 TAXSCAN (HC) 224
In a recent ruling, the Allahabad High Court ruled that the absence of GSTN in a supplier’s certificate alone is not a valid ground for denying the Input Tax Credit ( ITC ) and directed the tax authorities to reconsider the petitioner’s claim.
The court set aside the impugned orders and remanded the matter to the original authority for fresh adjudication. The court directed the tax department to consider all submitted materials and issue a reasoned and speaking order within three months. The court also clarified that any amount deposited by the petitioner would be subject to the final decision of the tax department. The writ petition was allowed.
GAUTAM THADANI vs DIRECTOR INCOME TAX (INVESTIGATION) AND ANR CITATION: 2025 TAXSCAN (HC) 225
In the recent ruling,the High Court of Delhi,upheld the validity of the requisition under Section 132A of Income Tax Act,1961 and linked the seized ₹98,00,000 to undisclosed income, finding the assessee’s explanation about the cash unconvincing.
The two member bench comprising Vibhu Bakhru(Additional Chief Justice) and Swarana Kanta Sharma(Judge) found the petitioner’s explanations unconvincing and upheld the requisition, agreeing with the Income Tax Authorities that the cash was linked to undisclosed income. To Read the full text of the Order CLICK HERE
DELOITTE HASKINS & SELLS LLP vs UNION OF INDIA & ANR CITATION: 2025 TAXSCAN (HC) 226
The Delhi High Court recently rejected a challenge to the constitutional validity of Section 132(4) of the Companies Act, 2013, and Rules 3, 8, 10, and 11 of the National Financial Reporting Authority ( NFRA ) Rules, 2018.
In result, the Delhi High Court upheld the constitutional validity of Section 132(4) and the NFRA Rules while emphasizing the importance of procedural fairness and the separation of functions within regulatory bodies.
UNION OF INDIA & OTHERS vs FUTURE GAMING SOLUTIONS PVT. LTD. & ANOTHER ETC. CITATION: 2025 TAXSCAN (SC) 118
In a landmark ruling, the Supreme Court dismissed the Union Government’s appeal, affirming that lottery distributors are not liable to pay service tax under the Finance Act, 1994. The Court held that being no agency and no service rendered, service tax is not leviable on the transactions between the purchaser of the lottery tickets and the Government of Sikkim.
The bench held that being no agency and no service rendered by the respondents-assessees as an agent to the Government of Sikkim, service tax is not leviable on the transactions between the purchaser of the lottery tickets (respondents-assessees) and the Government of Sikkim. Gurmeet Singh appeared for the petitioner and Arjun Garg appeared for the respondent.
Madras HC issues Directions to Streamline Cheque Bounce cases under Negotiable Instruments Act
In order to expedite and guarantee the timely resolution of check bounce cases under the Negotiable Instruments Act, 1881 (NI Act), the Madurai Bench of the Madras High Court issued a number of directives. These directives were based on precedents previously established by the Supreme Court in similar instances throughout the years.
Additionally, the Court ordered that trial courts do everything in their power to finish the proceedings by the deadline set by Section 143(3) of the Negotiable Instruments Act, 1881. In order for the judicial magistrates who hear these matters to be informed, the Court additionally ordered that a copy of its ruling be forwarded to each Principal District Judge in Tamil Nadu.
M/S MANGALORE CHEMICAL AND FERTILIZERS LIMITED vs THE STATE OF KARNATAKA CITATION: 2025 TAXSCAN (HC) 228
The Karnataka High Court has held that Diesel Captive Generating Sets are exempt from tax under Section 11-A of the Karnataka Tax on Entry of Goods Act, 1979 r/w the provisions of Karnataka Value Added Tax, 2003.
Therefore, the question of law (b) & (c) are answered in favour of the Assessee and against the Revenue to the net effect that Diesel Captive Generating Sets are exempt from tax under Section 11-A of the Karnataka Tax on Entry of Goods Act, 1979 r/w the provisions of Karnataka Value Added Tax, 2003.
THE COMMISSIONER OF INCOME TAX vs M/S JINDAL TRACTEBEL POWER CO. LTD CITATION: 2025 TAXSCAN (HC) 229
The Karnataka High Court has quashed the penalty for non-deduction of TDS on professional advice.
The court determined that the Chairman of the Advance Ruling Authority did not handle the regular assessee’s application for an advance ruling on September 11, 1997, for personal reasons. Another consideration is the potential benefit to the respondent of not deducting the tax at source. Since all of these are unquestionably valid reasons for not modifying TDS, orders that are in line with them are immune from challenge.
M/s. Iliyas Granites, Baghajhari, Ganjam vs Superintendent GST and CE, Berhampur and others CITATION: 2025 TAXSCAN (HC) 230
In a recent case, the High Court of Orissa restored the pending proceedings demand of Goods and Service Tax (GST) on suppression and wilful misstatement.
A division bench of Justice Arindam Sinha, Acting Chief Justice and Justice M.S. Sahoo set aside the impugned order, restoring the proceeding. The petitioner will communicate certified copy of this order to opposite party no. I by 10th February, 2025 and obtain date of hearing. The authority will on hearing petitioner, pass fresh order. Petitioner will not seek unnecessary adjournments. In event the communication is not made impugned order will stand automatically restored.
Narayanan Pradhan vs Asst. Commissioner, GST and CE CITATION: 2025 TAXSCAN (HC) 231
Mr. Harichandan, advocate appears on behalf of petitioner and submitted that the impugned is show-cause notice dated February, 2024 carrying purported finding of misstatement made by his client, to underpay the tax issued under sub-section (l) in section 74 of Central Goods and Services Tax Act, 2017. The provision was invoked to avail extended period of limitation but there was no allegation of misstatement in the show cause notice.
A jurisdictional error under GST arises when a tax authority initiates proceedings or takes action beyond its legally defined area of authority. If a state GST officer issues a notice for a case under the Central GST jurisdiction, or vice versa. If a lower authority handles a case meant for a higher authority. If an officer from a different state or region issues a notice. When a case related to a regular taxpayer is handled under the composition scheme.
Simanchal Achary vs Joint Commissioner of State Tax CITATION: 2025 TAXSCAN (HC) 232
The petitioner, Simanchal Achary, is a works contractor, is challenging the first appellate order passed under section 107 of th Act related to the tax period from July 2017 to March 2018. The petitioner claims that some payments made were not considered in the adjudication order passed under section 74 of the Act as well as appellate order.
A division bench of Justice Arindam Sinha, Acting Chief Justice and Justice M.S. Sahoo directed the respondent, the Joint Commissioner of State Tax (Appeal) and others, needs to verify whether the claimed payments were indeed not considered by the appellate authority. For the same , the court listed the matter on 25th February, 2025.
Ganesh Prasad Singh vs The Union of India CITATION: 2025 TAXSCAN (HC) 233
The Patna High Court has held that the Enforcement Directorate ( ED ) loses the power to arrest when special court takes cognizance under Prevention of Money Laundering Act ( PMLA ), 2002.
In deciding the anticipatory bail application, the court determined that the ED never felt the need to arrest the petitioner during the course of the investigation and that, once the offense punishable under Section 4 of the PMLA is recognized based on a complaint under Section 44(1)(b) of the PMLA, the ED and its officers are not authorized to use Section 19 of the PMLA to arrest an individual listed as an accused in the complaint.
M/S HI-LITE PROJECTS PVT.LTD vs STATE OF KERALA CITATION: 2025 TAXSCAN (HC) 234
In a significant ruling, the Kerala High Court has provided relief to M/s Hi-Lite Projects Pvt. Ltd., a works contractor, by allowing them to avail a lower tax rate under the Kerala Value Added Tax (KVAT) Act instead of the Central Sales Tax (CST) Act.
Consequently, the Kerala High Court Bench of Justice A K Jayasankaran Nambiar and Justice Easwaran S set aside the tribunal’s order and restored the first appellate authority’s decision, allowing Hi-Lite Projects to avail the lower tax rate.
Support our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates
