Annual Tax and Corporate Law Digest 2025: High Court Cases [Part XLI]

The Allahabad High Court addressed the scope of refund claims under Section 54 of the GST Act, 2017, clarifying that a refund application is not limited to the person who deposited the tax with the Government. The Court held that any person who has paid the tax such as a principal paying GST to a contractor can claim a refund upon proving payment. The judgment arose from a writ petition filed by Ambuja Cement Limited, which sought a refund of GST paid to its contractor for a project later cancelled. The authorities had rejected the refund on the ground that Ambuja itself had not deposited the tax directly.

A Single Bench of Justice Piyush Agrawal held that Section 54(1) allows “any person claiming refund… [to] make an application,” and the only requirement is proof of payment, which Ambuja had provided. The Court observed that refund provisions are remedial and should be interpreted liberally. Consequently, the appellate order rejecting the refund was set aside, and the matter was remanded to the first appellate authority for fresh consideration, with directions to issue a reasoned order after granting Ambuja an opportunity of personal hearing within two months.

Loan Default Alone Not Ground for Travel Restriction: Delhi HC quashes LOC Issued by Bank of Baroda against Director in ₹130 Crore UAE Loan Default Case

MANAN GOEL vs UNION OF INDIA & ORS. CITATION : 2025 TAXSCAN (HC) 2352

The Delhi High Court addressed the legality of a Look-Out Circular (LOC) issued by Bank of Baroda against Manan Goel, a director of Gulf Petrochem FZC, UAE, ruling that a loan default alone cannot justify restricting a person’s right to travel. The Court observed that in the absence of a cognizable offence, the “economic interest of India” exception under the Office Memorandums governing LOCs cannot be invoked, particularly in cases involving foreign loan defaults where the petitioner was merely a guarantor. The LOC was issued following a default on a loan of approximately ₹130 crores by the company for which Mr. Goel had provided a personal guarantee.

The Single Bench of Justice Sachin Datta held that the bank had not demonstrated any exceptional circumstance threatening India’s economic interest. The court quashed the LOC while directing the petitioner to furnish an affidavit undertaking to cooperate with any investigation. The Court clarified that any breach of this undertaking would be treated as wilful disregard of its order, thereby protecting the petitioner’s fundamental right to travel under Article 21 while ensuring cooperation with regulatory authorities.

Relief to ICICI Home Finance: Chhattisgarh HC Raps Tehsildar for Delay, Calls SARFAESI Action a "Ministerial Step"

ICICI Home Finance Company Limited vs State Of Chhattisgarh CITATION : 2025 TAXSCAN (HC) 2353

The Chhattisgarh High Court dealt with the enforcement of a possession order under Section 14 of the SARFAESI Act, emphasising that the process of taking physical possession of secured assets is a ministerial step that must be executed without delay. The petition was filed by ICICI Home Finance Company Limited against the State of Chhattisgarh and the Tehsildar of Raipur after the Tehsildar failed to act on a District Magistrate’s order dated 25.08.2025, directing possession of assets from borrowers Durga Verma and Kuleshwar Singh Verma to recover a loan default. The Court noted that any inaction frustrates the purpose of the SARFAESI Act, which is designed to ensure swift enforcement of secured creditors’ rights.

The Single Bench of Justice Parth Prateem Sahu observed that the Tehsildar’s role is ministerial, not quasi-judicial. The High Court directed the Tehsildar to complete the physical possession within 60 days from receipt of the Court’s order, reinforcing that “time is of the essence” in such proceedings and ensuring compliance with statutory timelines under the SARFAESI framework.

Demand Notice Issued During Stay Period is invalid: Delhi HC Quashes CCI's Demand for Interest on Penalty against United India Insurance

"UNITED INDIA INSURANCE COMPANY LIMITED vs COMPETITION COMMISSION OF INDIA " CITATION : 2025 TAXSCAN (HC) 2357

The Delhi High Court addressed the validity of interest demanded by the Competition Commission of India (CCI) on a penalty imposed on United India Insurance Company Limited for alleged cartelization in health insurance schemes under Regulation 5 of the Competition Commission of India (Manner of Recovery of Monetary Penalty) Regulations, 2011. The Court examined whether the demand notices issued during the stay of the penalty by the Competition Appellate Tribunal (COMPAT) were valid and whether interest could lawfully accrue when the penalty itself was under stay.

The Division Bench of Justice Anil Kshetarpal and Justice Harish Vaidyanathan Shankar held that the demand notice served on 01.10.2015 was invalid as it was issued during the subsistence of COMPAT’s stay order, and applied the doctrine of merger, noting that the final order of COMPAT had substantially reduced the penalty, which was duly paid by the appellant. Consequently, the Court quashed the CCI’s Order and the demand notices, clarifying that no interest could arise on the basis of an inoperative demand notice.

Delhi HC Questions BCI’s Foreign Law Firm Rules as Council Says No CJI or Centre Approval Needed

AVIMUKT DAR vs BAR COUNCIL OF INDIA CITATION : 2025 TAXSCAN (HC) 2358

The Delhi High Court took strong exception to the Bar Council of India’s (BCI) handling of the Registration and Regulation of Foreign Lawyers and Foreign Law Firms in India Rules, 2022, after the BCI claimed it did not require approval from the Chief Justice of India or the Central Government before issuing the framework. The petitions were filed by Dentons Link Legal and CMS IndusLaw, challenging the validity of the Rules and the show-cause notices issued to them over alleged unauthorized collaborations with foreign law firms. The Court noted serious statutory and constitutional concerns, including whether Section 49 of the Advocates Act, 1961 empowers the BCI to regulate foreign lawyers and whether the framework could impose major penalties based solely on preliminary inquiries.

Appearing before the Division Bench of Chief Justice Devendra Kumar Upadhyaya and Justice Tushar Rao Gedela, the BCI submitted that the Rules were validly framed, but the Court remarked that the regulatory framework was “a mess” and advised the Council to ensure proper drafting and clarity. The Bench extended interim protection for the petitioners, restraining the BCI from taking any final action, and allowed two weeks for filing the counter-affidavit. The Court also highlighted ambiguities in defining “Indian law firm” and reinforced concerns over punitive powers exercised without a clear evidentiary basis. The matter is scheduled to be heard next in January 2026.

2 Gold Bangles and 2 iPhones Seized from Dubai Passenger Found to Be Wedding Gifts: Delhi HC Orders Release

PUJA KUMARI vs COMMISSIONER OF CUSTOMS CITATION : 2025 TAXSCAN (HC) 2359

The Delhi High Court recently directed the Customs Department to release two gold bangles and two iPhones seized from a passenger arriving from Dubai, after determining that the items were bona fide wedding gifts and not intended for any unlawful purpose. The petitioner, Puja Kumari, had approached the Court under Article 226 following an order-in-original dated 19 December 2023, which had directed absolute confiscation of the items, denied her free allowance, declared her an ineligible passenger, and imposed a penalty of Rs. 1,20,000 under Sections 112(a) and 112(b) of the Customs Act. The Appellate Authority, after examining her marriage certificate, her husband’s UAE resident card, and related documents, observed that the items were personal gifts for a newly married bride and allowed their release upon payment of a redemption fine and applicable duty, modifying the original order.

The Division Bench of Justices Prathiba M. Singh and Shail Jain enforced the appellate decision after the Revisional Authority dismissed the Customs Department’s revision on 22 October 2025. The Court directed the Customs Department to release the goods on payment of the fine and duty, waive any warehousing charges, and appointed a nodal officer to ensure compliance. The petitioner was instructed to appear before the Customs Department on 24 November 2025, and the writ petition was disposed of, ensuring she was not penalized for delays arising from multiple departmental proceedings.

Heavy Penalty in GST ITC Fraud Case and Hearing Concerns: Delhi HC Allows Appellate Remedy Without Limitation Bar

M/S SAMARTH TRADERS vs ASSISTANT COMMISSIONER OF CENTRAL TAX CITATION : 2025 TAXSCAN (HC) 2360

The Delhi High Court recently observed that an assessee facing substantial penalties in an alleged Input Tax Credit (ITC) fraud case may pursue statutory appellate remedies, and that such an appeal will not be rejected on the ground of limitation if filed within the timeframe fixed by the Court. The case involved Samarth Traders, against whom the adjudicating authority confirmed a GST demand of ₹1.34 crore, imposed an equal penalty under Section 74, appropriated attached bank balances, and levied a separate penalty on the proprietor under Section 122(3) of the CGST Act.

The petitioner had challenged the order, arguing that they were not granted a proper opportunity for personal hearing. While the Department contended that hearing notices were issued and the petitioner did not cooperate, the Court noted that a substantial penalty had been imposed and emphasized that the appropriate recourse was an appeal under Section 107 of the CGST Act. The Division Bench of Justice Prathiba M. Singh and Justice Shail Jain allowed the petitioner to file the appeal on or before 15 December 2025 with the requisite pre-deposit, clarifying that it shall be decided on merits and not dismissed merely on limitation grounds. The writ petition and pending applications were disposed of accordingly.

Karnataka HC quashes Denial of Mistakenly Paid IGST Refund after Duly Paid to State Authorities

M/S MERCK LIFE SCIENCE PRIVATE LIMITED vs THE UNION OF INDIA CITATION : 2025 TAXSCAN (HC) 2361

The Karnataka High Court recently addressed the legal issue of refund of Integrated GST (IGST) wrongly paid under a bona fide mistake by a taxpayer. The matter involved determining whether the limitation period under Section 54 of the CGST Act, 2017 applies to refund claims arising from tax paid under the wrong classification of supply. The Court examined the applicability of Section 19(1) of the IGST Act, 2017 and Section 77(1) of the CGST Act, 2017, which govern refunds of tax erroneously paid to the wrong Government authority, and clarified that retaining such tax would lead to unjust enrichment of the authorities.

A Division Bench comprising Justice S.R. Krishna Kumar allowed the writ petitions filed by Merck Life Science Pvt. Ltd., quashing the multiple orders of the Assistant Commissioner of Central Taxes that had denied the refund. The Court held that Section 54 limitation is directory, not mandatory, in cases of wrongful payment under mistaken classification, and directed the Central Tax Authorities to process and release the refund within three months. The judgment reinforces the principle that taxpayers are entitled to recover taxes paid under bona fide errors without being barred by technical time limits.

Allahabad HC grants bail to Accused alleged of Committing Rs. 120 crores GST Fraud

Mukul Sharma vs Commissioner CITATION : 2025 TAXSCAN (HC) 2362

The Allahabad High Court recently dealt with a bail application in a GST fraud case involving alleged evasion of over ₹120 crore through shell companies and bogus supplies. The matter concerned offences under Section 132(1) of the CGST Act, 2017, which relate to tax evasion and fraudulent input tax credit. The Court considered the nature of the offences, noting that they are triable by a Magistrate and carry a maximum punishment of five years with fine, despite the large monetary amount involved.

The Single Bench comprising Justice Sameer Jain granted bail to Mukul Sharma, observing that the accused had already spent nearly one and a half years in custody, the investigation was complete, and the prosecution’s case was largely documentary, reducing any risk of tampering with evidence. Relying on precedents including Ratnambar Kaushik v. Union of India (2023) and Vineet Jain v. Union of India (2025), the Court held that prolonged incarceration is unwarranted when offences carry limited sentences and do not involve violence. The Court allowed the bail, directing the release of the accused upon furnishing a personal bond and two sureties, emphasizing the presumption of innocence until proven guilty.

Non-filing of Part-B of GST E-way Bill due to Tech Glitch not Amounts to Tax Evasion: Allahabad HC quashes Penalty

M/S Archana Plasmould vs State Of Up CITATION : 2025 TAXSCAN (HC) 2363

The Allahabad High Court recently addressed the issue of penalties under Section 129(3) of the CGST Act, 2017, concerning non-filing of Part B of a GST e-way bill. The Court held that when such non-compliance arises from a technical glitch and there is no intention to evade tax, it cannot attract penal consequences. The petitioner, M/s Archana Plasmould, a registered GST taxpayer in Gujarat, had its consignment detained even though all documents were in order, solely because Part B of the e-way bill was not generated.

A Single Bench comprising Justice Piyush Agarwal quashed the penalty imposed by both the adjudicating and appellate authorities, observing that no authority had found any fraudulent conduct or intent to evade tax. The Court relied on binding precedents, including the Division Bench judgment in M/s Tata Hitachi Construction Machinery Co. Pvt. Ltd. v. State of U.P. (2025), which held that mere non-filing of an e-way bill does not justify a penalty. It further directed the department to refund any amount deposited, emphasizing that liability under Section 129(3) requires a statutory precondition of tax evasion intent, which was absent in this case.

Goods Accompanied by Genuine GST E-Way Bill Cannot Be Seized: Allahabad HC Criticises Authorities for Forcing Avoidable Litigation

M/S Prostar M Info Systems Limited vs State of UP and 3 others CITATION : 2025 TAXSCAN (HC) 2364

The Allahabad High Court recently addressed the issue of detention of goods under Section 129(3) of the CGST Act, 2017, holding that goods accompanied by a valid and genuine GST e-way bill cannot be seized or detained. The Court criticised the GST authorities for dragging a registered taxpayer, M/s Prostar M Info Systems Limited, into unnecessary litigation despite full compliance. The company had transported UPS systems and related parts from its Noida unit to Lucknow, and the consignment was accompanied by a valid e-way bill and delivery challan at the time of interception. Minor clerical errors, such as an unsigned challan and a missing additional business address, were found but did not constitute intent to evade tax.

The Single Bench comprising Justice Piyush Agarwal quashed the orders of the adjudicating and appellate authorities, noting that the Commissioner’s circular dated 17 January 2024 was binding on all field officers and made clear that mere clerical lapses cannot justify detention. The Court emphasised that once goods are accompanied by a valid e-way bill, their movement is fully disclosed to the department, precluding any presumption of tax evasion. The judgment reinforced that authorities cannot detain goods with genuine documentation, and directed that the writ petition be allowed, thereby ending the litigation against the petitioner.

GST E-way bill Expires due to Kanwar Yatra Traffic ban: Allahabad HC says No Tax Evasion Found, Quashes Penalty

Sachin Jain vs State of U.P. Thru. Prin. Secy. State Taxes Lko CITATION : 2025 TAXSCAN (HC) 2365

The Allahabad High Court recently ruled on the issue of penalties under Section 129(3) of the UP GST Act, 2017, holding that expiry of an e-way bill caused by external factors such as traffic restrictions during the Kanwar Yatra cannot be treated as an act of tax evasion. The petitioner, Sachin Jain, had transported mentha oil from Barabanki to Badaun with all proper documentation, including a valid e-invoice, e-way bill, Form 9R under the Mandi Adhiniyam, and a Mandi Gate Pass. Due to government-imposed traffic restrictions, the consignment was delayed, causing the e-way bill to expire by two days. The GST authorities nevertheless issued a show cause notice and imposed a penalty of nearly ₹25 lakh.

The Single Bench comprising Justice Jaspreet Singh quashed both the penalty and appellate orders, noting that the movement of goods was fully transparent, documented, and undisputed. The Court emphasized that intent to evade tax (mens rea) is a mandatory element for imposing penalties under Section 129, and no such intent was present. The judgment underscored that technical lapses beyond a transporter’s control cannot attract harsh penal consequences, reinforcing that GST penalties require both statutory preconditions and evidence of deliberate evasion.

Is Pre-Consultation before GST SCN Mandatory or Discretionary? Delhi HC Grants Interim Relief to Aadhar India

AADHAR INDIA vs THE ADDITIONAL DIRECTOR CITATION : 2025 TAXSCAN (HC) 2367

The Delhi High Court recently addressed the constitutional validity of Notification No. 79/2020–Central Tax, which amended Rule 142(1A) of the CGST Rules, 2017, in a writ petition filed by Aadhar India. The notification had substituted “shall” with “may,” making pre-consultation under Section 74(5) of the CGST Act discretionary rather than mandatory. The petitioner contended that this amendment effectively deprived taxpayers of the opportunity to make voluntary payments before issuance of a Show Cause Notice (SCN), contrary to the legislative intent, and argued that the rule-making authority cannot override the parent statute.

The Division Bench comprising Justice Prathiba M. Singh and Justice Shail Jain granted interim relief, directing that while proceedings arising from the SCN dated 29 November 2024 may continue, no final orders under Section 74 shall be enforced without further permission of the Court. The Bench observed that the matter is under consideration in connected petitions, including SSAPP Overseas, and emphasized that taxpayers’ rights to pre-SCN consultation must be protected. The batch of petitions has been listed for further hearing on 27 January 2026.

GST Payer uses Writ Petitions as Tool to Bypass 10% Pre-Deposit: Allahabad HC notes Henderson Principle, Dismisses Petition

M/S Simla Gomti Pan Products Pvt. Ltd vs Commissioner of StateTax U.P. Commissioners Office CITATION : 2025 TAXSCAN (HC) 2368

The Allahabad High Court dismissed a writ petition filed by M/s Simla Gomti Pan Products Pvt. Ltd., holding that the petitioner deliberately used multiple writ petitions to evade the mandatory 10% pre-deposit required under Section 107(6)(b) of the GST Act to maintain a statutory appeal. The Court observed that the petitioner had repeatedly challenged assessment orders for the Assessment Years 2021-22 and 2022-23 under Section 74 of the GST Act through successive writs, even after dismissal by the High Court and rejection of the Special Leave Petition by the Supreme Court, thereby bypassing the statutory appellate mechanism.

Justice Jaspreet Singh, relying on the Henderson Principle and the doctrine of constructive res judicata, held that issues central to the case, including exemption from pre-deposit, should have been raised at the earliest opportunity. Filing successive writ petitions on the same question without seeking exemption earlier was held to be an abuse of the process of law. The Court termed the petitioner’s conduct as a “deliberate attempt… to evade the pre-deposit” and dismissed the petition as misconceived.

"Alternative Remedy Available": Orissa HC Refuses to Interfere in Bank of India's SARFAESI Action

Akshay Kumar Udaysingh vs Regional Manager CITATION : 2025 TAXSCAN (HC) 2369

The Orissa High Court dismissed a writ petition filed by borrowers Akshay Kumar and Udaysingh against the Bank of India, reaffirming that the High Court’s jurisdiction under Article 226 cannot be invoked where an efficacious alternative remedy exists under the SARFAESI Act. The petition challenged a notice dated 30.10.2025 and an auction advertisement for the sale of mortgaged property, seeking quashing of the bank’s actions and direction for settlement under a One-Time Settlement (OTS) scheme. The Court relied on the Supreme Court’s observations in Bafna Motors regarding the borrower’s right of redemption under Section 13(8) of the SARFAESI Act, noting that the statutory framework curtails redemption rights upon publication of the auction notice.

The division bench comprising Justice S.K. Sahoo and Justice Sibo Sankar Mishra emphasized that the SARFAESI Act provides a self-contained remedial framework and that borrowers must first approach the Debt Recovery Tribunal (DRT) under Section 17. The Court held that writ petitions cannot be used to circumvent the specialized procedures of the Act. The petition was dismissed, while the petitioners were granted liberty to pursue their grievances before the DRT, with the Court clarifying that it had not commented on the merits of the case.

Company Not Found During GST Anti-Evasion Visit, Absence Due to Family Bereavement: Delhi HC Directs Re-Inspection

M/S STALWART INDIA ALLOYS LIMITED vs UNION OF INDIA & ORS. CITATION : 2025 TAXSCAN (HC) 2370

The Delhi High Court addressed a writ petition filed by Stalwart India Alloys Limited challenging the retrospective cancellation of its GST registration under the CGST Act. The cancellation, dated 26 September 2025, was based on a show-cause notice alleging the company was not found at its registered premises during an Anti-Evasion inspection on 20 December 2024. The petitioner explained that its absence was due to a family bereavement and requested a re-inspection, contending that retrospective cancellation cannot be ordered unless the show-cause notice explicitly proposed it—a position consistently upheld by the Court.

The Division Bench comprising Justice Prathiba M. Singh and Justice Madhu Jain set aside the retrospective cancellation and directed the GST Department to conduct a fresh inspection after giving prior notice. The Court recorded an undertaking from the petitioner’s Director to cooperate with the investigation and allowed the company to file a detailed reply to the show-cause notice. A fresh order is to be passed thereafter in accordance with law. The writ petition was disposed of, leaving all rights and remedies of the parties open.

Belated Filing of GST Return Automatically Nullifies Best - Judgment Assessment issued u/s 62: Madras HC

Tvl. BERNARD KARUTHUDAIYAN vs The Deputy State Tax Officer CITATION : 2025 TAXSCAN (HC) 2371

The Madurai Bench of the Madras High Court dealt with a writ petition concerning a best judgment assessment issued under Section 62 of the Tamil Nadu Goods and Services Tax Act, 2017 against a non-filer of GST returns. The petitioner, Tvl. Bernard Karuthudaiyan, had failed to file his August 2024 return, leading to the issuance of a GSTR-3A notice and a best judgment assessment order dated 16 October 2024. The petitioner later filed the overdue return on 21 November 2024 and challenged the assessment order as arbitrary and without jurisdiction.

Justice G.R. Swaminathan held that a best judgment assessment under Section 62 automatically stands withdrawn once a valid return is filed, even if it is beyond the 30-day period specified in the statute, noting that the timeline is directory and not mandatory. The Court allowed the writ petition, lifted the attachment on the petitioner’s bank account, and clarified that the tax department may verify the return and issue a fresh show-cause notice if discrepancies or short payment are found.

Recovery Barred During Pending Appeal: Kerala HC Stays Income Tax Dept’s Recovery Action against Oralium Ltd.

ORALIUM LIMITED vs ASSISTANT COMMISSIONER OF INCOME TAX CITATION : 2025 TAXSCAN (HC) 2372

The Kerala High Court intervened in a dispute between Oralium Limited and the Income Tax Department, addressing the issue of recovery of a penalty for the assessment year 2020-21 while the company’s appeal and stay petition were pending. The petitioner argued that the department’s attempts to recover the penalty before the disposal of the appeal caused undue hardship and violated statutory principles, prompting the writ petition.

The single bench of Justice Ziyad Rahman A.A. stayed the recovery proceedings and directed the Commissioner of Income Tax (Appeals) to decide the stay petition within two months. The Court emphasized that until a final decision is rendered on the stay petition, no recovery actions pursuant to the impugned penalty order shall be undertaken, providing immediate interim relief to the petitioner and ensuring the appeal process is not prejudiced.

Delhi HC Waives Pre-Deposit for CGST Appeal as Same ITC Demand Already Raised By State GST

VANEETA IMPEX PRIVATE LIMITED vs UNION OF INDIA CITATION : 2025 TAXSCAN (HC) 2375

The Delhi High Court recently allowed Vaneeta Impex Private Limited to file an appeal against a CGST demand without making any additional pre-deposit, as the same Input Tax Credit (ITC) amount had already been subject to a demand by the State GST authorities. The writ petition challenged the Order-in-Original dated 27 January 2025, which raised a CGST demand of ₹56,50,646 along with an equal penalty for F.Y. 2017-18. The petitioner submitted that it had already deposited the statutory 10% pre-deposit for the earlier State GST demand concerning the same ITC, and that pursuing a second pre-deposit would be impermissible under Section 6(2)(b) of the CGST Act and relevant Supreme Court precedent.

The Division Bench of Justice Prathiba M. Singh and Justice Shail Jain observed that the petitioner could pursue the appellate remedy under Section 107 of the CGST Act without being required to make any additional pre-deposit. The Court directed that the appeal be filed on or before 31 January 2026, clarified that it shall not be dismissed on the ground of limitation if filed within the granted period, and mandated that a personal hearing be provided to the petitioner. The writ petition was accordingly disposed of.

Faceless Reassessment Mandatory for International Tax Cases: Bombay HC Quashes S.148 Notice Issued by Jurisdictional AO

Shabana Aijaz Khan vs Income Tax Officer CITATION : 2025 TAXSCAN (HC) 2376

The Bombay High Court has held that faceless reassessment under Section 148 of the Income Tax Act, 1961 is mandatory, including in cases involving international taxation. The Court quashed a reassessment notice issued by the Jurisdictional Assessing Officer (JAO) to Shabana Aijaz Khan, holding it invalid because notices under the faceless reassessment scheme must be issued by the Faceless Assessing Officer.

The Division Bench of Justice B. P. Colabawalla and Justice Amit S. Jamsandekar held that the faceless procedure applies even to central charges and international taxation. The Court set aside the Section 148 notice and all proceedings arising from it but granted the Revenue liberty to revive the petition if the Supreme Court overturns Hexaware, with the quashed notice remaining stayed until further orders. The writ petition was allowed with no order as to costs.

Kerala HC Clarifies Retrospective Application of Extended GST Return Filing Deadline in ITC Cases

LIZ ENTERPRISES vs THE STATE OF KERALA CITATION : 2025 TAXSCAN (HC) 2377

The Kerala High Court has disposed of a batch of writ petitions concerning Goods and Services Tax (GST) Input Tax Credit (ITC), granting relief to assessees facing procedural and technical difficulties in claiming ITC. The petitions involved taxpayers whose ITC claims were rejected due to GST not being reflected in returns, suppliers not remitting GST, or lack of clear proof of tax payment. The Court referred to Circular No.183/15/2022-GST and Circular No.193/05/2023-GST, allowing assessees to claim ITC upon submitting proof of payment by the supplier, and granted them thirty days to approach the authorities to avail of these circulars.

The Court also ruled that the amendment to Section 39 by the Finance Act 2022, which extended the September return filing deadline from September 30 to November 30, should be applied retrospectively from 01.07.2017, ensuring ITC claims filed before November 30 are processed. The constitutional validity of Sections 16(2)(c) and 16(4) of the CGST/SGST Act was upheld. A single bench of Justice Dinesh Kumar Singh adopted the reasoning of its earlier judgment directing that petitioners eligible under the circulars make their claims within one month, and clarified that September returns filed by November 30 in each financial year from 01.07.2017 shall be treated as timely.

SBI could Not be Treated as an "Assessee in Default" for Non-deduction of TDS on LTC Payments: Kerala HC

STATE BANK OF INDIA vs COMMISSIONER OF INCOME TAX CITATION : 2025 TAXSCAN (HC) 2378

The Kerala High Court allowed the appeal filed by the State Bank of India (SBI), holding that the bank could not be treated as an “assessee in default” under Sections 201(1) and 201(1A) of the Income Tax Act, 1961 for non-deduction of Tax Deducted at Source (TDS) on Leave Travel Concession (LTC) payments to employees for F.Y. 2015-16 (A.Y. 2016-17). The Court observed that the LTC payments were made pursuant to interim directions issued by the Madras High Court, which explicitly stated that such payments would not constitute taxable income for employees and prohibited SBI from deducting TDS. Consequently, SBI had no statutory obligation to deduct tax under Section 192, making the Income Tax Department’s action inapplicable.

The Division Bench of Justice A. Muhamed Mustaque and Justice Harisankar V. Menon relied on precedents to hold that compliance with a valid court order shields a payer from liability as an assessee in default. The Court emphasized that the interim directions were binding nationwide under the Income Tax Act, rendering SBI justified in not deducting TDS. Accordingly, the High Court set aside the demand and interest under Sections 201(1) and 201(1A), ruling in favour of SBI and against the revenue.

Merely Agents and Not Suppliers: Calcutta HC Quashes GST Appellate Order for Non-Application of Mind

Indrani Dhar & Anr. vs The State of West Bengal & Ors. CITATION : 2025 TAXSCAN (HC) 2379

The Calcutta High Court dealt with a writ petition concerning the liability to pay Goods and Services Tax (GST) under the West Bengal Goods and Services Tax Act, 2017 (WBGST Act). The legal issue revolved around whether the petitioners, Indrani Dhar & Anr., who acted merely as agents of the supplier, could be held responsible for GST liability. The matter specifically involved the appellate authority’s dismissal of the petitioners’ appeal against an adjudication order issued under Section 74(9) of the WBGST Act, which addresses cases of tax not paid or short paid due to fraud, misstatement, or suppression of facts.

The bench comprising Justice Om Narayan Rai observed that the appellate order dated June 26, 2025 lacked substantive reasoning and merely echoed the adjudicating authority’s order, making it unsustainable under Article 226 of the Constitution of India. The High Court held that the petitioners, being agents and not suppliers, were not liable to pay the GST and therefore quashed the appellate order.

Relief to Aditya Birla Capital: Himachal Pradesh HC Sets Two-Month Deadline for Pending SARFAESI Plea

Aditya Birla Capital Ltd vs State of H.P & ors CITATION : 2025 TAXSCAN (HC) 2380

The Himachal Pradesh High Court dealt with a writ petition filed by Aditya Birla Capital Ltd. seeking intervention in the delayed adjudication of its application under Section 14 of the SARFAESI Act, 2002, which pertains to the possession of secured assets. The legal issue before the Court was the pendency of the application before the Assistant Chief Judicial Magistrate (ACJM), Nalagarh, and the petitioner’s request for directions to expedite the hearing in a time-bound manner.

The division bench comprising Justice Sandeep Sharma and Justice Jiya Lal Bhardwaj observed that, while the writ petition was prima facie not maintainable, the Court could pass a direction in light of the innocuous prayer. The High Court directed the ACJM, Nalagarh, to decide the SARFAESI application expeditiously, preferably within two months, ensuring that the petitioner and other stakeholders were given an opportunity of being heard. The Court clarified that it had not expressed any opinion on the merits, and the lower court was to decide the matter independently.

Service of Notice before Income Tax Reassessment is Mandatory: Jharkhand HCC Quashes Penalty u/s 271(1)(b)

Principal Chief Commissioner of Income Tax vs AssistantCommissioner of Income Tax CITATION : 2025 TAXSCAN (HC) 2381

The Jharkhand High Court addressed a writ petition filed by General Traders, concerning the mandatory requirement of valid service of notice before initiating reassessment proceedings under the Income Tax Act, 1961. The legal issue involved whether reassessment and penalty proceedings under Sections 147, 148, 142(1), 271(1)(b), and 271(1)(c) could be sustained when statutory notices were allegedly not properly served on the assessee. The Court emphasized that valid service is a jurisdictional prerequisite, not a mere procedural formality.

The Division Bench comprising Chief Justice Tarlok Singh Chauhan and Justice Rajesh Shankar held that the reassessment proceedings, ex parte assessment orders, and penalty orders were vitiated due to improper service, as the notices were sent to an outdated email despite the assessee having updated its registered email with the Department. The Court quashed all impugned notices, assessment orders, and penalties, and remanded the matter to the Assessing Officer to proceed afresh after ensuring proper service and affording the petitioner an opportunity of hearing.

Re-Export Cannot be Denied When Importer Never Intended Domestic Clearance: Allahabad HC Dismisses Revenue Appeal

"Principal Commissioner Noida Customs Commissionerate vsBest Crop Science Private Ltd." CITATION : 2025 TAXSCAN (HC) 2382

The Allahabad High Court addressed an appeal filed by the Revenue under Section 130 of the Customs Act, 1962, concerning the re-export of imported goods. The legal issue revolved around whether an importer can re-export goods without provisional release or adjudication when the importer had no intention to clear or distribute the goods in the domestic market, and whether Customs authorities could insist on preconditions under Sections 110A and 124 of the Act.

The Division Bench comprising Justice Dayal Singh and Justice Indrajeet Shukla upheld the order of the CESTAT, noting that the factual finding that the importer sought re-export before any detention or seizure was unchallenged. The Court held that technical requirements like provisional release were immaterial in such circumstances and confirmed that the importer could re-export the consignment unconditionally. Consequently, the Revenue’s appeal was dismissed, and no duty, penalty, or redemption fine was payable.

ITC Reversal u/r 29(2) of UP VAT Rules Unsustainable When Books of Account Accepted: Allahabad HC Remands BP Oil Mills Case

M/S B.P. Oil Mills Ltd. vs The Commissioner Of Commercial Tax CITATION : 2025 TAXSCAN (HC) 2383

The Allahabad High Court dealt with a dispute under Rule 29(2) of the U.P. VAT Rules concerning the reversal of Input Tax Credit (ITC). The issue arose when the Assessing Authority denied ITC to B.P. Oil Mills Ltd., alleging that the dealer failed to maintain separate accounts of goods consigned outside the State, as required under Section 21(1)(v) of the U.P. VAT Act. The Court examined whether ITC can be denied when the dealer’s books of account are otherwise complete, accepted, and free from defects.

The bench comprising Justice Piyush Agarwal held that reversal of ITC solely for alleged non-compliance with Rule 29(2) was unsustainable when the dealer maintained defect-free records. The Court emphasized that Section 21(1)(v) allows flexibility by requiring separate accounts “as far as possible,” and procedural lapses cannot override substantive rights. The matter was remanded to the Tribunal for fresh consideration in light of this interpretation, ensuring ITC is not denied where statutory obligations are otherwise met.

ITAT’s Reasonless Rejection of Second Adjournment Leads to Ex-Parte Order Being Quashed by Allahabad HC

Ashok Kumar Agarwal vs The Assistant Commissioner Of Income Tax CITATION : 2025 TAXSCAN (HC) 2384

The Allahabad High Court addressed a case concerning the principles of natural justice in appellate proceedings before the Income Tax Appellate Tribunal (ITAT), Agra Bench. The legal issue involved the ITAT’s ex-parte disposal of Revenue appeals for Assessment Year 2015-16 after rejecting the assessee’s second adjournment request without assigning any reasons, which the Court held violated natural justice. The matter arose in an appeal by Ashok Kumar Agarwal challenging ITAT’s ex-parte order on two Revenue appeals where the Tribunal failed to consider the assessee’s adjournment application.

The Division Bench of Justice Saumitra Dayal Singh and Justice Indrajeet Shukla held that the ITAT’s reasonless denial of the adjournment was impermissible. While emphasizing the need for expeditious disposal, the Court noted that appellate authorities must provide a reasoned order and grant fair opportunity of hearing. The High Court set aside the ex-parte ITAT order and directed the Tribunal to issue fresh notice, hear both parties, and pass a reasoned order within six months.

No Error in Assessment as AO Examined All Expenses and Made Due Inquiry: Allahabad HC Upholds ITAT Order

The Pr Commissioner Of Income Tax-1 vs Anjali Singhal CITATION : 2025 TAXSCAN (HC) 2385

The Allahabad High Court examined the legality of a revisional action under Section 263 of the Income Tax Act, 1961 in the case of Pr. Commissioner of Income Tax-1 vs. Anjali Singhal. The legal issue revolved around whether the Assessing Officer (AO) had conducted proper inquiry while scrutinizing the assessee’s A.Y. 2018-19 returns, particularly regarding cash salary payments and business promotion expenses, and whether the PCIT was justified in treating the assessment as erroneous and prejudicial to Revenue.

The Division Bench of Justice Saumitra Dayal Singh and Justice Arun Kumar upheld the ITAT’s decision, agreeing that the AO had conducted adequate inquiries. The Court noted that cash payments to employees did not exceed ₹10,000 per individual, negating the applicability of Section 40A(3), and business promotion expenses were properly scrutinized. The High Court held that in the presence of two plausible views, the AO’s decision could not be overturned under Section 263, and thus the PCIT’s revisional order was unsustainable. The Revenue’s appeal was dismissed as no substantial question of law arose.

GAIL India’s Goods Detained by GST dept: Allahabad HC Quashes Detention noting Technical Error not Tax Evasion

Gail (India) Ltd. vs State Of U.P. And 2 Others CITATION : 2025 TAXSCAN (HC) 2386

The Allahabad High Court addressed the legality of seizure and penalty proceedings under Section 129(3) of the Central Goods and Services Tax (CGST) Act, 2017 in the case of GAIL (India) Ltd. The legal issue concerned whether minor clerical errors in an e-way bill could justify detention of goods and imposition of penalties when the movement involved a stock transfer between two units of the same government-owned enterprise, with no sale or consideration involved.

The Single Bench of Justice Piyush Agarwal quashed the seizure and penalty order, holding that technical discrepancies in invoices and vehicle details cannot constitute tax evasion. The Court relied on CBIC guidance and earlier precedents, noting that all goods belonged to GAIL’s Raigarh unit and were being transferred internally to its Pata unit for operational purposes. Since no sale or supply was involved, the detention and penalties were unsustainable, and the authorities were directed to release the consignment.

No Error in Treating ₹122.31 Lakh Cash Deposits as Sales: Allahabad HC Backs AO’s Approach

The Pr. Commissioner Of Income Tax vs Rukmani Devi Jain CITATION : 2025 TAXSCAN (HC) 2387

The Allahabad High Court considered the applicability of Section 263 of the Income Tax Act, 1961 in the case of Rukmani Devi Jain, addressing whether the Principal Commissioner of Income Tax (PCIT) could revise an assessment for A.Y. 2015-16 on the ground that the Assessing Officer (AO) had allegedly failed to make adequate inquiries into cash deposits totaling ₹122.31 lakh. The key legal issue was whether the AO’s treatment of the deposits as sales receipts could be deemed erroneous or prejudicial to the Revenue, thereby justifying revision under Section 263.

The Division Bench of Justice Saumitra Dayal Singh and Justice Arun Kumar upheld the ITAT’s Agra Bench decision quashing the PCIT’s revision. The Court held that the AO had conducted proper inquiries, disbelieved the assessee’s explanations, and adopted one of two permissible views. Observing no perversity in the AO’s assessment or the Tribunal’s findings, the High Court ruled that the assessment was neither erroneous nor prejudicial to the Revenue, and therefore, the PCIT’s invocation of Section 263 was without jurisdiction. The Revenue’s appeal was accordingly dismissed.

GST Exemption on Pure Services to Statutory Medical University: Allahabad HC to decide Issue

M/S A. N. Kapoor Janitors Private Limited vs The AdditionalCommissioner CITATION : 2025 TAXSCAN (HC) 2388

The Allahabad High Court is set to examine whether Goods and Services Tax (GST) can be levied on pure services provided to a statutory medical university under state legislation. The legal issue arises from a writ petition filed by M/s A.N. Kapoor Janitors Pvt. Ltd., challenging the appellate order dated 16 July 2025, which denied its claim for GST exemption under Notification No. 12/2017–Central Tax (Rate). The petitioner contends that its services to the Sanjay Gandhi Post Graduate Institute of Medical Sciences (SGPGI) are “pure services” under Chapter 99 and fall within the exemption granted to “Government authorities” under Entry No. 3 of the notification, as SGPGI is a statutory body established under the Sanjay Gandhi Post Graduate Medical College Act, 1983.

Justice Jaspreet Singh granted interim protection, staying the operation of the adjudicating authority’s order dated 16 July 2025, noting that the petitioner’s claim regarding statutory exemption appeared to have merit and warranted judicial scrutiny. The State was allowed time to file a counter affidavit, and the matter will be considered in detail on the next date of listing.

Rajasthan HC Denies Excise Duty Exemption, Holds that Benefits Cannot be claimed when Goods are Sold and Not Actually Exported

M/s Natural Lights Pvt. Ltd vs Principal Commissioner CITATION : 2025 TAXSCAN (HC) 2389

The Rajasthan High Court upheld the order of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), addressing the legal issue of whether a manufacturer can claim excise duty exemption on goods purportedly exported when the goods were actually sold to another company. The case involved M/s Natural Lights Pvt. Ltd., which contended that its goods, handed over to M/s Central Electronics Ltd. (CEL) for onward export under a contract with M/s Angelique International Ltd., entitled it to export-based duty exemption.

The Division Bench of Justices Sanjeev Prakash Sharma and Baljinder Singh Sandhu dismissed the appeal, observing that the Tribunal had carefully examined the records and correctly concluded that the appellant sold the goods to CEL rather than exporting them directly.

GST Appellate Orders Cannot be Reserved and Pronounced Later without Notifying Assessee: Allahabad HC Calls Order ‘Unsustainable’

M/S Sun Glass Works Private Limited vs The State Of U.P. CITATION : 2025 TAXSCAN (HC) 2390

The Allahabad High Court addressed the legal issue of whether GST appellate orders can be reserved and pronounced on a later date without notifying or hearing the assessee, holding such a practice legally unsustainable under the principles of natural justice. The case involved M/s Sun Glass Works Private Limited, which challenged the appellate order passed by the Additional Commissioner (Appeals), Mainpuri, and the original order under Section 74(1) of the GST Act, alleging wrongful availment of Input Tax Credit (ITC).

The Bench of Justice Piyush Agarwal, observed that the appellate authority had reserved the order on 18.09.2024 and pronounced it on 25.09.2024 without notifying the petitioner, a practice unsupported by any statutory provision. Relying on the precedent in M/s Wonder Enterprises v. Additional Commissioner, Grade-2, the Court held that passing orders without giving notice and opportunity to be heard violates procedural safeguards and principles of natural justice.

GST Seizure for Alleged Reuse of E-Way Bill Unsustainable Without Enquiry: Allahabad HC Quashes Proceedings

M/S Deepam Packaging And Food Private Ltd vs AdditionalCommissioner CITATION : 2025 TAXSCAN (HC) 2391

The Allahabad High Court examined the legality of a seizure carried out under Section 129(3) of the Central Goods and Services Tax (CGST) Act, 2017, specifically addressing whether goods can be detained on the allegation of reuse of an e-way bill without conducting any factual enquiry. The issue arose when M/s Deepam Packaging and Food Private Ltd. challenged the seizure and consequential appellate order, contending that the authorities failed to verify the alleged misuse of documents and ignored the driver’s explanation regarding a vehicle breakdown. The Court scrutinised the statutory mandate under Section 129, which governs detention, seizure, notice, and penalty for goods transported in contravention of GST law.

The Single Judge Bench of Justice Piyush Agarwal held that the seizure was unsustainable, noting that the department had proceeded entirely on presumptions without conducting even a basic enquiry to verify how the vehicle allegedly returned to Kanpur, reloaded goods, and reused the same e-way bill.

Date of GST Notice and Personal Hearing alleged to be Same: Allahabad confirms Such Practice should Discontinued

M/S Hitachi Systems India Pvt. Ltd vs State Of U.P CITATION : 2025 TAXSCAN (HC) 2392

The Allahabad High Court examined a significant procedural lapse in GST adjudication concerning the issuance of a show-cause notice under Section 73 of the U.P. GST Act, 2017, where the date for filing a reply and the date for personal hearing were fixed on the same day. The petitioner challenged both the assessment order and the appellate order dismissed on limitation arguing that the authorities had failed to provide a meaningful opportunity of hearing, thereby violating Section 75(4) and the basic principles of natural justice.

The Single Judge Bench of Justice Jaspreet Singh held that scheduling the reply deadline and the personal hearing on the same date renders the proceedings legally defective. Noting the Commissioner’s Office Memorandum acknowledging widespread procedural errors, the Court found that the mandatory safeguard of personal hearing had been undermined. The High Court therefore quashed the assessment order and the appellate order, and remanded the matter to the assessing authority to pass a fresh order after granting proper and adequate opportunity of hearing.

Tax, Interest & Penalty in GST Demand cannot Exceed Amount determined by Proper Officer: Allahabad HC Quashes Order M/S Chaurasiya Zarda Bhandar vs State Of U.P CITATION : 2025 TAXSCAN (HC) 2393

The Allahabad High Court examined the legality of a Goods and Services Tax (GST) assessment order passed under the Central Goods and Services Tax (CGST) Act, 2017, specifically addressing a violation of Section 75(7), which prohibits confirmation of any tax, interest or penalty beyond what is proposed in the Show Cause Notice (SCN). The assessee challenged an assessment order and the consequential attachment, arguing that while the SCN for F.Y. 2019-20 proposed a tax demand of ₹29,07,002, it contained no proposal for interest or penalty; yet the final order imposed substantial interest and penalty, inflating the total demand to ₹55,71,191.

The Single Judge Bench of Justice Manish Kumar held that the assessment order was arbitrary and directly contrary to Section 75(7), noting that the Revenue itself could not dispute that the SCN lacked any proposal for interest or penalty. Since the adjudicating authority cannot impose any demand exceeding or differing from what is stated in the SCN, the Court ruled that the impugned order along with the consequential attachment was legally unsustainable.

Tyres & Tubes were ‘Spare Parts’ in CST Regn. Certificate for Road Construction: Allahabad HC scraps Penalty for Invalid Purchase The Commissioner, Commercial Tax vs M/S K M C Construction CITATION : 2025 TAXSCAN (HC) 2394

The Allahabad High Court examined the scope of a dealer’s eligibility to purchase goods under the Central Sales Tax Act, 1956, specifically addressing whether tyres and tubes used in road construction machinery fall within the expression “spare parts and machinery” as mentioned in the assessee’s CST registration certificate. The core legal issue centred on the validity of a penalty imposed under Section 10-A, which is attracted when a registered dealer is alleged to have falsely represented, under Section 10(b), that certain goods are covered by its registration.

The Single Judge Bench of Justice Piyush Agrawal upheld the view taken by the Commercial Tax Tribunal and held that the purchase of tyres and tubes was duly authorised under the entry “spare parts and machinery” in the CST registration certificate. The Court observed that tyres and tubes form essential components of heavy construction equipment and therefore cannot be treated as unauthorised goods.

₹17.7 Crore Penalty on Customs broker Challenge Rejected: Allahabad HC Directs Broker to Avail Appeal

Shri Rajesh Tripathi vs Union Of India And 2 Others CITATION : 2025 TAXSCAN (HC) 2395

The Allahabad High Court examined whether a writ petition under Article 226 of the Constitution could be maintained against a penalty of ₹17,71,27,830 imposed on a Customs Broker under Section 114(iii) of the Customs Act, 1962, along with Sections 147 and 114(AA). The central legal issue before the Court was whether the petitioner penalised for alleged involvement in mis-declaration of export goods could bypass the statutory appellate remedy and seek relief directly under writ jurisdiction.

The Division Bench comprising Justice Saumitra Dayal Singh and Justice Kunal Ravi Singh, upheld the Revenue’s preliminary objection on maintainability. The Bench held that the petitioner had an effective statutory appellate remedy, and that disputed factual issues such as the extent of the Customs Broker’s role must be adjudicated by the appellate authority rather than in writ jurisdiction.

Allahabad HC Permits Shifting of SEZ Goods to Bonded Warehouse Amid DRI Adjudication

Margo Impex Private Limited vs Union Of India CITATION : 2025 TAXSCAN (HC) 2396

The Allahabad High Court dealt with a petition seeking permission to shift warehoused goods from a SEZ facility to a bonded warehouse during the pendency of adjudication proceedings initiated under the Customs Act by the Directorate of Revenue Intelligence (DRI). The petitioners, Margo Impex Private Limited and another, approached the Court under writ jurisdiction, requesting clearance of goods stored at the Arshiya Northern Free Trade Warehousing Zone (ANFTWZ), ICD Khurja, Bulandshahr, which had been withheld pursuant to a show-cause notice. The core issue was whether the petitioners could move the goods under customs supervision while the DRI’s adjudication, including potential confiscation, was still pending, without prejudicing the Revenue’s interests.

The Division Bench comprising Justice Saumitra Dayal Singh and Justice Vivek Saran allowed the shifting of goods subject to compliance with five conditions prescribed by the DRI, including filing a Yellow Bill of Entry, approval by SEZ Customs, issuance and submission of a re-warehousing certificate, and duty-recovery measures if the certificate was not timely submitted. Observing that the Revenue itself had no objection to the transfer under these safeguards, the Court disposed of the writ petition, permitting movement of goods to the bonded warehouse. The Bench clarified that it would not comment on the merits of the ongoing confiscation proceedings, ensuring that its order would not prejudice the adjudication process.

Allahabad High Court Grants Bail after 14 Year Absence from Trial

Jagesh Rajbhar @ Jagesh Rai vs Union Of India Thru. Gaurav KumarAsst CITATION : 2025 TAXSCAN (HC) 2397

The Allahabad High Court considered a bail application in a long-pending Customs case under Section 135(1)(B) of the Customs Act, 1962, where the applicant, Jagesh Rajbhar, faced prosecution for alleged offences related to customs violations. The legal issue revolved around whether the applicant could be granted bail despite his prolonged absence from the trial for nearly fourteen years, during which no prosecution witnesses had been examined, and the Trial Court had declared him an absconder under Section 82 of the CrPC.

The Bench of Justice Karunesh Singh Pawar granted bail, observing that the applicant’s prior decade-long compliance with bail conditions, absence of criminal antecedents, and the relatively moderate punishment for the offence weighed in his favour. Bail was allowed subject to strict conditions, including furnishing a personal bond and two sureties, mandatory attendance on all trial dates, prohibition on tampering with evidence, and restriction on seeking unnecessary adjournments.

Madras HC Rejects 6-Month Delay Revision Plea, Notes Applicant had Ample time to Contest Gold & Silver Seizure after Surgery

Noorul Ayin vs The Commissioner of Customs (Appeals-I) CITATION : 2025 TAXSCAN (HC) 2397

The Madras High Court recently dealt with a writ petition concerning condonation of delay in filing a revision petition under Section 129DD of the Customs Act, 1962. The petitioner, Noorul Ayin, sought relief after filing a revision application nearly six months beyond the prescribed period following a medical surgery, challenging an Order-in-Appeal by the Commissioner of Customs (Appeals-I), Chennai, which had upheld the seizure of imported gold and silver coins intended for re-export. The legal issue revolved around whether the petitioner’s medical condition justified condoning the delay.

The Bench of Justice N. Anand Venkatesh dismissed the writ petition, observing that the petitioner’s surgery had taken place months after the limitation period expired and that the petitioner had been actively contesting the matter before CESTAT in the interim.

Delhi HC Directs CBIC to File Final Draft of Revised Baggage Rules by December: Gold, Alcohol & Electronics Ingress under Review

QAMAR JAHAN vs UNION OF INDIA, REPRESENTED BY SECRETARY,MINISTRY OF FINANCE & ORS. CITATION : 2025 TAXSCAN (HC) 2399

The Delhi High Court is currently adjudicating a writ petition concerning the revision of the Baggage Rules, 2016, specifically relating to the import of articles such as gold, alcohol, electronics, and personal effects by inbound passengers. The petitioner, Qamar Jahan, challenged the outdated monetary limits on duty-free gold jewellery, highlighting that the current thresholds under Rule 5: 20 grams for men (₹50,000) and 40 grams for women (₹1,00,000) are misaligned with prevailing market rates. The legal issue concerns the CBIC’s delay in finalising amendments to modernize these rules in line with current travel and market realities.

The Division Bench comprising Justice Prathiba M. Singh and Justice Rajneesh Kumar Gupta directed the Central Board of Indirect Taxes and Customs (CBIC) to submit the final draft of the revised Baggage Rules by December 18, 2025. The Bench noted that while the draft rules have been prepared, implementation was pending due to ongoing digital infrastructure upgrades via the Atithi App.

State GST Officer submits Adverse Report on Bogus Firm before ITC Fraud: Allahabad HC Quashes Suspension Order

Malikhan Singh vs State Of U.P. CITATION : 2025 TAXSCAN (HC) 2400

The Allahabad High Court quashed the suspension of a State Tax Officer accused of delay in submitting a verification report under the Goods and Services Tax (GST) regime. The officer, Malikhan Singh, had conducted a physical verification of a GST applicant firm and submitted an adverse report identifying the firm as bogus. The legal issue centered on whether the officer’s suspension for alleged delay was justified, given that the fraudulent ITC claim by the firm occurred due to inaction by the Assistant Commissioner, not the reporting officer.

The bench of Justice Vikas Budhwar held that the suspension order dated 23.08.2025 could not be sustained, noting that the petitioner had submitted the adverse report on 3.03.2024, which was acted upon by the Assistant Commissioner through a show cause notice. The Court set aside the suspension but allowed a departmental inquiry to proceed, directing it to be concluded within four months, clarifying that no prima facie misconduct was attributable to the officer for the delay.

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