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

ASSISTANT COMMISSIONER OF INCOME TAX VS SATWASHIL VASANT MANE CITATION : 2025 TAXSCAN (HC) 1660

The Kerala High Court considered whether a taxpayer is entitled to interest on a refund under the Direct Tax Vivad Se Vishwas Act, 2020 despite Section 7 excluding statutory interest under Section 244A of the Income Tax Act.

A Division Bench of Justices A.K. Jayasankaran Nambiar and Baswaraj S. held that while Section 7 excludes statutory interest, courts retain the power to grant compensatory interest under general law. The Court ruled the petitioner was entitled to interest for the nearly two-year delay in refund and dismissed the Income Tax Department’s appeal.

Person Found Guilty Under FEMA Cannot Seek Compounding After Adjudication: Calcutta HC Upholds RBI’s Rejection

In a recent ruling, the Calcutta High Court held that a person found guilty under the Foreign Exchange Management Act, 1999 (FEMA) cannot seek compounding of the offence after the adjudication proceedings have been decided. The court upheld the Reserve Bank of India’s decision to reject the petitioner’s post-adjudication compounding application.

The court observed that Rule 11 of the Compounding Rules refers to appeals and does not suggest that compounding is available indefinitely after adjudication has ended. The court held that the Reserve Bank of India was correct in rejecting the petitioner’s compounding application.The writ petition was dismissed, and the interim order was vacated.

C PRASANNAKUMARAN UNNITHAN vs THE INCOME TAX APPELLATE TRIBUNALCOCHIN BENCH CITATION : 2025 TAXSCAN (HC) 1662

The Kerala High Court examined whether the Income Tax Appellate Tribunal (ITAT) was correct in dismissing a stay petition for non-payment of a 20% pre-deposit, despite a prior Division Bench order having removed this requirement.

The Single-Judge Bench of Justice Bechu Kurian Thomas found that the ITAT erred in dismissing the stay petition based on a vacated condition. The Court set aside the ITAT’s order and directed it to reconsider the stay petition on merits within two months, partially allowing the writ petition.

THE COMMISSIONER OF CENTRAL TAX vs M/S GOVERNMENT OFFICIALWELFARE ORGANISATION CITATION : 2025 TAXSCAN (HC) 1663

The Delhi High Court examined whether trading in land and immovable property without fixed remuneration attracts service tax. The issue arose from a trust facilitating allotment of residential flats without charging commission, but the revenue contended that the trust’s activities amounted to “real estate agent service.”

A bench of Justices Prathiba M. Singh and Rajneesh Kumar Gupta upheld the CESTAT’s decision, applying precedents to hold that the trust’s refundable deposits and absence of fixed remuneration mean no service tax liability arises. The Court dismissed the revenue’s appeal, emphasizing that taxing such activities years later would unfairly burden the trust and disrupt settled transactions.

PRINCIPAL COMMISSIONER OF CUSTOMS vs M/SGO IP GLOBAL SERVICESPVT. LTD CITATION : 2025 TAXSCAN (HC) 1664

The Delhi High Court considered whether Wireless Access Points (WAPs) with only MIMO or only LTE technology qualify for Basic Customs Duty exemption under the pre-2021 Customs Notification, focusing on the interpretation of “MIMO and LTE Products.”

A Division Bench of Justices Prathiba M. Singh and Rajneesh Kumar Gupta ruled that the notification’s wording requires both technologies to be present for the exclusion, so WAPs with only MIMO qualify for exemption. The Court dismissed the Revenue’s appeal, affirming the exemption for the company’s WAPs and relying on precedent from Ingram Micro India Pvt. Ltd.

RAMDIYA VERMA vs COMMISSIONER OF CUSTOMS NEW DELHI & ANR CITATION : 2025 TAXSCAN (HC) 1665

The Delhi High Court examined whether customs authorities must preserve CCTV footage immediately after seizure in cases involving alleged smuggling, specifically concerning the seizure of a 250g gold kada at the airport.

The bench of Justice Prathiba M. Singh and Justice Rajneesh Kumar Gupta held that CCTV footage, retained only for 30 days, must be preserved promptly to safeguard passengers’ rights. The Court directed disposal of the petitioner’s revision within a month and ordered an inquiry into the alleged illegal seizure of Thai Baht.

PRINCIPAL COMMISSIONER OF INCOME TAX vs TANUJ PROPERTIES PRIVATELIMITED CITATION : 2025 TAXSCAN (HC) 1666

The Calcutta High Court addressed whether an assessee could benefit from the Direct Tax Vivad Se Vishwas Scheme, 2024, by allowing physical submission of Forms 1 and 2 beyond the statutory deadline due to delay in the Department’s appeal filing.

A bench comprising Chief Justice T.S. Sivagnanam and Justice Chaitali Chatterjee condoned the delay in the Revenue’s appeal, deemed the appeal filed within the limitation period as of 31 July 2024, and allowed the assessee to submit the required forms within 10 days physically. The Court directed the Department to process the application and facilitate payment within six weeks, emphasizing that assessees should not be prejudiced by Departmental delays.

Factual Correlation of Seized Material Must Be Done by Authorities, Court Cannot Step into AO’s Role: Bombay HC

DNH Spinners Private Limited vs Deputy Commissioner ofIncome-tax CITATION : 2025 TAXSCAN (HC) 1667

The Bombay High Court examined whether writ jurisdiction under Article 226 allows the Court to decide factual correlation of seized documents forming the basis of notices issued under Section 153C of the Income Tax Act. The petitioner challenged the validity and timing of notices issued based on material seized in a 2019 search of the Alankit group.

A Division Bench of Justices M.S. Sonak and Jitendra Jain held that determining whether incriminating material exists is a factual matter for the Assessing Officer and cannot be decided in writ proceedings. The Court refused to quash the notices and dismissed the petitions, allowing the petitioner to raise objections before the Assessing Officer and on appeal.

M/s Louis Dreyfus Company Private Limited vs Union of India andOthers CITATION : 2025 TAXSCAN (HC) 1668

The Andhra Pradesh High Court examined whether refund claims for GST paid on ocean freight could be denied on the ground of limitation after the levy was invalidated by the Supreme Court. The issue was whether the limitation period under the GST Act applies when the payment is not considered a “tax.”

A Division Bench of Justices R. Raghunandan Rao and Sumathi Jagadam allowed the petitioner’s refund claims, set aside rejections as time-barred, and directed reconsideration without regard to limitation, emphasizing that payment of an invalid tax is a payment under mistake of law.

M/S BVM PHARMA THROUGH PARTNER ALKABEN PANERI vs UNION OF INDIA& ORS CITATION : 2025 TAXSCAN (HC) 1669

The Gujarat High Court considered whether transfer or assignment of leasehold rights in industrial plots amounts to a taxable supply under GST or is excluded as a transfer of land under Entry 5, Schedule III of the CGST Act.

A division bench of Justice Bhargav D. Karia and Justice D.N. Ray, quashed the GST demand, holding that such transfer is not a taxable supply.

M/S.S &D SALES MARKETING vs THE DEPUTY COMMISSIONER OF STATETAX CITATION : 2025 TAXSCAN (HC) 1670

The Kerala High Court examined whether Input Tax Credit (ITC) available as IGST in the electronic credit ledger can be utilised to discharge liabilities under CGST and SGST, and conversely, effectively treating the ledger as a unified pool across tax heads.

A single-judge bench of Justice Bechu Kurian Thomas held that the electronic credit ledger functions as a unified “wallet” with compartments for IGST, CGST, and SGST—permitting cross-utilisation. The court set aside both the determination order and the appellate order, directing the Deputy Commissioner to reconsider the matter in light of Rejimon Padickapparambil Alex v. Union of India, and to decide the case afresh within three months after giving the petitioner an opportunity to be heard.

M/s Archita Soap And Chemical LLP vs - Joint Commissioner(Appeals) State Tax CITATION : 2025 TAXSCAN (HC) 1671

The Chhattisgarh High Court held that no recovery of GST demand is allowed after a taxpayer makes the statutory pre-deposit and files an undertaking to approach the Appellate Tribunal, as clarified by CBIC Circular No. 224/18/2024-GST.

Justice Deepak Kumar Tiwari ruled that upon complying with these requirements, recovery proceedings must remain stayed; however, failure to deposit within 15 days renders the order ineffective and allows recovery to resume.

Non-Filing of Part-B of E-Way Bill for Job Work Movement a Technical Lapse When Part-A Was Produced: Gujarat HC Reduces Penalty

M/S BORON RUBBERS INDIA vsUNION OF INDIA & ORS. CITATION : 2025 TAXSCAN (HC) 1672

In a recent ruling, the Gujarat High Court held that non-filing of Part-B of the E-Way Bill for goods moved for job work is a technical lapse when Part-A is produced, and such omission does not amount to tax evasion. The court reduced the penalty from 200% of tax to a nominal amount of Rs. 25,000.

The court held that the penalty imposed under Section 129(1)(a) was unsustainable. It reduced the penalty to Rs. 25,000 and directed that the balance amount be refunded to the petitioner by crediting it into the electronic cash or credit ledger. The writ petition was partly allowed to that extent.

Jawath Ali MohamedAharib vs The Principal Commissioner &Ex-Officio CITATION : 2025 TAXSCAN (HC) 1673

The Madras High Court addressed the legal issue of determining the date of receipt of a customs adjudication order when there is no acknowledgment or returned postal cover from the customs department. The question was crucial for calculating the limitation period for filing an appeal against the order.

The single bench of Justice Abdul Quddhose ruled that in the absence of any acknowledgment or returned cover, the assessee’s statement regarding the date of receipt of the order would prevail. This ruling affirms that the limitation period for appeal starts from the date mentioned by the assessee, ensuring fairness in cases where formal proof of service by customs is unavailable.

Jawath Ali MohamedAharib vs The Principal Commissioner &Ex-Officio CITATION : 2025 TAXSCAN (HC) 1673

The Madras High Court examined whether the limitation period for filing a customs appeal can be determined based on the assessee’s statement of receipt in the absence of postal acknowledgment or returned cover from the Customs Department.

Justice Abdul Quddhose held that without evidence proving earlier receipt, the assessee’s claim of receiving the adjudication order on 16 August 2017 must be accepted. The Court quashed the orders dismissing the appeal as time-barred and directed the authorities to reconsider the matter on merits within three months.

BenQ India Private Limited vs The Commissioner of Customs CITATION : 2025 TAXSCAN (HC) 1674

The Madras High Court addressed the legal issue of classification of goods in a customs appeal filed by BenQ India Private Limited. The petitioner contended that the imported goods were wrongly classified by customs authorities, affecting the applicable duty rates and seeking relief through the appellate process.

The single bench of Justice Abdul Quddhose directed the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) to consider relevant judicial precedents cited by BenQ India while entertaining the appeal on merits. The Court emphasized that CESTAT must give due weight to established case law to ensure correct classification and adjudication, thereby safeguarding the petitioner’s rights during the appeal process.

BenQ India Private Limited vs The Commissioner of Customs CITATION : 2025 TAXSCAN (HC) 1674

The Madras High Court considered whether the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) should take judicial precedents into account in a classification dispute raised by BenQ India regarding imported goods.

Justice Abdul Quddhose directed that although the writ petition was not entertained on merits, CESTAT must consider the petitioner’s cited precedents while deciding the statutory appeal. The Court allowed BenQ India two weeks to file the appeal and dismissed the writ petition as not pressed.

M/s. Mahindra & Mahindra Ltd vs Commissioner of Income-tax CITATION : 2025 TAXSCAN (HC) 1675

The Bombay High Court considered whether an Assessing Officer can go beyond the net profit in the P&L account when computing book profits under Section 115J of the Income Tax Act.

A division bench of Chief Justice Alok Aradhe and Justice M. S. Karnik declared that the AO's actions exceeded his jurisdiction, emphasizing that only adjustments explicit in the Explanation are valid. Consequently, the ruling of the tribunal was set aside in favour of the assessee, Mahindra & Mahindra.

M/s. Mahindra & Mahindra Ltd vs Commissioner of Income-tax CITATION : 2025 TAXSCAN (HC) 1675

The Bombay High Court examined whether expenditure incurred on a subsidiary to protect goodwill or manage reputational risk qualifies as a deductible expense under the Income Tax Act.

A division bench of Chief Justice Alok Aradhe and Justice M. S. Karnik, allowed the appeal by Mahindra & Mahindra Ltd., setting aside the disallowance by the ITAT and affirming that such expenditures are deductible where incurred for business expediency.

M/S Bharat Sanchar Nigam Ltd vs Commissioner Trade TaxCommercial Govt. of U.P CITATION : 2025 TAXSCAN (HC) 1676

The Allahabad High Court examined whether providing telephone handsets to subscribers constitutes a transfer of the right to use goods, and if 10% of rental receipts could be taxed under Section 3F of the U.P. Trade Tax Act. BSNL challenged the Trade Tax Tribunal’s order which estimated a portion of rent attributable to handsets due to lack of bifurcation in records.

A bench headed by Justice Piyush Agrawal upheld the Tribunal’s decision, observing that BSNL failed to produce agreements or records despite opportunities. The court ruled that the estimation was justified, and BSNL is liable to pay trade tax on 10% of rental receipts as consideration for the right to use telephone handsets.

THE WEST BENGAL STATE CO-OPERATIVE AGRICULTURE & RURAL vsDEPUTY COMMISSIONER OF INCOME TAX CITATION : 2025 TAXSCAN (HC) 1678

The Calcutta High Court considered whether interest earned on surplus lending funds by a cooperative bank is attributable to its banking business and thus deductible under Section 80P of the Income Tax Act. The issue also involved whether interest on personal loans to members and house building loans to staff qualifies for such deduction.

A bench of Chief Justice T.S. Sivagnanam and Justice Chaitali Chatterjee held that interest earned on surplus funds invested temporarily is integral to the bank’s lending business and deductible under Section 80P(2)(a)(i). However, interest on house building loans to staff was disallowed as per the Assessing Officer and CIT(A). Regarding personal loans to certain members (Class D), the deduction under Section 80P was allowed.

PRINCIPAL COMMISSIONER OF CUSTOMS vs M/S LOUVERLINE BLINDS CITATION : 2025 TAXSCAN (HC) 1679

The High Court of Karnataka addressed the issue of whether shipping bills under the MEIS (Merchandise Exports from India Scheme) could be converted to the DEPB (Duty Entitlement Pass Book) scheme, considering that a similar examination scale applied to both. The legal question was whether such conversion was permissible and if the Revenue's appeal against this practice should be upheld.

The bench comprising of Justice S.G.Pandit and Justice K.V. Aravind upheld the Customs, Excise and Service Tax Appellate Tribunal’s (CESTAT) order allowing the conversion of MEIS shipping bills to the DEPB scheme. The bench dismissed the Revenue’s appeal, affirming that the similar examination scale warranted such conversion and the associated export benefits should not be denied.

THE PRINCIPAL COMMISSIONER OF CENTRAL TAX vs WIPRO TECHNOLOGIES CITATION : 2025 TAXSCAN (HC) 1680

The Karnataka High Court dealt with the issue of whether Wipro Technologies was entitled to a refund of CENVAT credit accumulated on exported software services, which were not taxable. The core legal question was whether such a refund claim could be upheld despite the exported services being non-taxable under the relevant laws.

The division bench comprising Justices S.G.Pandit and K.V.Aravind upheld the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) decision granting Wipro the CENVAT credit refund. The Court held that the refund was permissible as Wipro was not acting as an intermediary and had used input services for export on a principal-to-principal basis, thereby deserving the refund despite the non-taxability of exported software services.

CHILUME SOCIAL SERVICE SOCIETY vs THE INCOME TAX OFFICER CITATION : 2025 TAXSCAN (HC) 1681

The Karnataka High Court dealt with the legal issue of a seven-year delay in filing appeals, which was attributed to the ill health of the trustee. The primary question was whether the delay could be excused for this reason and if the appeal could proceed despite the long lapse of time.

The bench of Justice Vibhu Bakhru and Justice C M Joshi dismissed the appeal, upholding the decisions of the Income Tax Appellate Tribunal and the Commissioner of Income Tax (Appeals). The Court held that no substantial question of law arose from the delay, thereby affirming the earlier orders and rejecting the appeal.

ARHAAN FERROUS AND NON FERROUS SOLUTIONS vs THE SUPERINTENDENT CITATION : 2025 TAXSCAN (HC) 1682

The Andhra Pradesh High Court dealt with the legal issue of whether a GST show cause notice (SCN) or order can be issued without mentioning a Document Identification Number (DIN), which is mandatory under the GST rules. The petitioner challenged the cancellation of GST registration on the ground that the SCN and cancellation order were issued without a DIN.

The Division Bench of Justice R. Raghunandan Rao and Justice T.C.D. Sekhar quashed the registration cancellation notice, holding that the absence of a DIN rendered the SCN and cancellation order invalid. The Court emphasized that the issuance of DIN is a mandatory procedural requirement, and failure to comply with this requirement affects the legitimacy of the proceedings, warranting quashing of the impugned notice and order.

Abhinandan Sahoo vs Chief Commissioner of CT & GST CITATION : 2025 TAXSCAN (HC) 1683

The Orissa High Court dealt with the legal issue of whether a writ petition filed against a GST Section 73 order after an 11-month delay without explanation could be entertained. The petitioner challenged the validity of the GST demand notice under Section 73, which pertains to tax recovery for periods of alleged tax evasion or short payment.

The Division Bench of Chief Justice Harish Tandon and Justice Murahari Sri Raman declined to entertain the writ petition, invoking the maxim "Vigilantibus non dormientibus jura subveniunt" (the law helps those who are vigilant, not those who sleep on their rights). The Court held that undue and unexplained delay disentitles the petitioner from seeking relief through writ jurisdiction, emphasizing the need for timely action in such matters.

Mehool Narendra Bhuva vs Assistant Commissioner of Income Tax CITATION : 2025 TAXSCAN (HC) 1684

The Bombay High Court examined whether the sale proceeds of a vintage car qualify as exempt “personal effects” under Section 2(14) of the Income Tax Act when the taxpayer fails to show proof of personal use.

A division bench of Chief Justice Alok Aradhe and Justice Sandeep V. Marne, upheld the ITAT’s decision, noting the absence of evidence such as parking at the taxpayer’s residence, maintenance or running expenses, or personal use, and confirmed that proceeds from the sale of the vintage car are taxable as capital gains.

M/s. Eagle Security vs Union of India, through the Secretary CITATION : 2025 TAXSCAN (HC) 1685

The Bombay High Court examined the constitutional validity of Sections 17(2) and 17(3) of the CGST Act, 2017, challenging the denial of Input Tax Credit (ITC) on security services under the Reverse Charge Mechanism (RCM). The petitioner argued this treatment violated Articles 14 and 19(1)(g) by unfairly discriminating against proprietorship entities and increasing their costs.

A Division Bench of Justices M.S. Sonak and Jitendra Jain upheld the provisions, ruling that classification between corporate and non-corporate entities is permissible and ITC is a statutory concession subject to conditions. The Court held that the right to carry business does not guarantee competitiveness, and deferred to legislative policy in taxation, dismissing the petition for lack of constitutional infirmity.

Om Traders vs Union of India CITATION : 2025 TAXSCAN (HC) 1686

The Patna High Court dealt with whether errors in reporting taxable value and IGST in GSTR-3B (April 2019), inconsistent with GSTR-1, can be rectified despite no portal mechanism, when such errors created undue tax liability.

A division bench of Justices P. B. Bajanthri and S. B. Pd. Singh quashed the demand and directed authorities to allow manual rectification of GSTR-3B in line with GSTR-1, holding that genuine clerical errors should not create undue tax liability.

THE PRINCIPAL COMMISSIONER OF INCOME TAX vs M/S. OASIS CENTRELLC CITATION : 2025 TAXSCAN (HC) 1688

The Karnataka High Court dealt with the taxability of software fees under the India-UAE Double Taxation Avoidance Agreement (DTAA) after the Assessing Officer (AO) treated Rs.13.26 crores received by Oasis Centre LLC as royalty under Section 9(1)(vi) of theIncome Tax Act.

A bench of Justices S.G. Pandit and K.V. Aravind disposed of the Revenue’s appeal against the ITAT’s remand for examining the taxability under the DTAA. Since the AO passed an order during the appeal proceedings holding the receipt as royalty, the Court found the challenge to the remand irrelevant and disposed of the appeal without addressing substantive questions.

ANUJ JAIN vs PRINCIPAL COMMISSIONEROFCUSTOMS CITATION : 2025 TAXSCAN (HC) 1689

The Delhi High Court considered the legal issue of whether the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) should hear an appeal concerning a duty demand imposed for a second container that was seized from a godown, provided that a 50% pre-deposit is made.

The bench comprising of Justice Prathiba M. Singh and Justice Shail Jain directed CESTAT to hear the duty demand appeal on a seized container after the petitioner pays Rs. 7,45,646 as a 50% pre-deposit within six weeks. The appeal will be heard on 6th October 2025, with all rights and contentions kept open for both sides.

M/S ITI LTD vs THE UNION OF INDIA AND 6 ORS CITATION : 2025 TAXSCAN (HC) 1690

The Gauhati High Court dealt with the issue of GST Input Tax Credit (ITC) and related demands imposed on ITI Ltd. The legal question arose due to the denial of ITC and demands raised without considering the amended provisions of Section 16 of the CGST Act, particularly Section 16(5), which protects certain credits.

A division bench of Justice Mridul Kumar Kalita and Justice Rajesh Mazumdar set aside the GST department's order that denied ITC, directing the authorities to reconsider the demands in light of the amendments to Section 16. The Court emphasized that the amended provisions had to be applied, granting ITI Ltd relief and remitting the matter for fresh adjudication after granting the company a fair opportunity of hearing.

Canara Bank vs Deputy Commissioner Sales Tax Office CITATION : 2025 TAXSCAN (HC) 1691

The Bombay High Court considered whether Section 26E of the SARFAESI Act, giving priority to secured creditors, overrides State sales tax claims recorded under the MVAT Act in respect of auctioned property.

A division bench of Justice B. P. Colabawalla and Justice Somasekhar Sundaresan directed deletion of the State’s encumbrance, upholding Canara Bank’s petition, and clarifying that the State may recover dues only from other assets.

Payio Ashiho vs Union of India CITATION : 2025 TAXSCAN (HC) 1692

The Bombay High Court examined whether the term “spouse” under Section 56(2)(x) of the Income Tax Act, 1961 excludes same-sex couples, thereby denying them tax exemption on gifts and violating constitutional equality.

A division bench of Justice B. P. Colabawalla and Justice Firdosh Pooniwalla issued notice to the Attorney General of India and the Income Tax Department, making the matter returnable on September 18, 2025.

THE COMMISSIONER OF INCOME TAX vs XIOCOM (NZ) LTD CITATION : 2025 TAXSCAN (HC) 1693

The Delhi High Court addressed the legal issue of whether payment for the resale or use of computer software through End-User License Agreements (EULAs) amounts to "royalty" under the Income Tax Act, attracting TDS liability under Section 195. The Department contended that such payments were taxable as royalty, requiring TDS deduction by the Indian entity.

A division bench of Justices V. Kameswar Rao and Vinod Kumar upheld the view that these payments are not royalty since they confer only the right to use the software, not the copyright itself. The Court relied on the Supreme Court’s ruling in Engineering Analysis Centre of Excellence (2021) and ruled that no taxable income arises in India from such transactions, and hence no TDS liability under Section 195 exists. The Department’s appeal was dismissed accordingly.

Fresh Refund Claim u/s 27(1-B) of Customs Act Not Required as Original Claim Filed in Time Madras HC Quashes Order

M/s.G.E.India Industrial Pvt. Ltd vs .The Commissioner (Appeals) CITATION : 2025 TAXSCAN (HC) 1694

The Madras High Court recently addressed the legal issue of whether a fresh refund claim under Section 27(1-B) of the Customs Act, 1962, is necessary when the original refund claim was already filed within the stipulated time limit. The case dealt with the validity of an order that mandated a fresh application for refund, despite an earlier claim being made in time.

A bench comprising Justice C.Saravanan pronounced the judgment, quashing the impugned order and holding that a new refund claim is not required if the original claim was submitted on time. The Court clarified that insisting on a fresh claim was unwarranted, setting aside the authorities' order to this effect.

SD POLYMERS THROUGH ITS PROPRIETOR PROP. HEM LATA GUPTA vsCOMMISSIONER OF CENTRAL GOODS AND SERVICE TAX AND ANR CITATION : 2025 TAXSCAN (HC) 1695

The Delhi High Court addressed the issue of a writ petition challenging a demand order related to alleged fraudulent Input Tax Credit (ITC) availment under the Goods and Services Tax (GST) regime. The key legal issue was whether the High Court should entertain the writ petition or direct the petitioner to pursue statutory remedies through the appellate process under Section 107 of the CGST Act, 2017.

A bench led by Justice Prathiba M. Singh and Justice Shail Jain declined to entertain the writ petition, emphasized the settled legal position that writ jurisdiction should not support unscrupulous litigants and that the petitioner must avail himself of the remedy of appeal. The petition was dismissed, reinforcing that courts generally do not interfere in fraudulent ITC cases via writ petitions.

Manav Seva Samiti vs Principal Chief Commissioner Of Income Tax(Exemptions) CITATION : 2025 TAXSCAN (HC) 1696

The Rajasthan High Court condoned a 700-day delay in filing the audit report by Manav Seva Samiti, a public charitable trust, due to the severe illness and subsequent death of its President, affecting the trust’s functioning. The Court set aside the order rejecting the condonation application under Section 119(2)(b) of the Income Tax Act.

A Division Bench of Justices K.R. Shriram and Sandeep Taneja found no mala fide intention in the delay and emphasized the trust’s bona fide charitable activities. The Court held that such an assessee should not be denied exemption solely on limitation grounds and allowed condonation, quashing the impugned order.

RADHEY TRADERS vs ASSISTANT COMMISSIONER LAXMI NAGAR DIVISION CITATION : 2025 TAXSCAN (HC) 1697

The Delhi High Court declined to entertain a writ petition challenging GST demands arising from misuse of a GSTIN, where the proprietor shared a cancellation OTP with an accountant who allegedly created multiple fake firms for fraudulent Input Tax Credit claims.

A bench of Justice Prathiba M. Singh and Justice Shail Jain held that the petitioner could not claim complete innocence due to sharing the OTP, and that such factual and criminal matters require police investigation. The Court dismissed the petition, directing the petitioner to pursue alternate remedies while noting the ongoing police inquiry.

RADHEY TRADERS vs ASSISTANT COMMISSIONER LAXMI NAGAR DIVISION CITATION : 2025 TAXSCAN (HC) 1697

The Delhi High Court examined the issue of GSTIN cancellation where the OTP for cancellation was shared with the taxpayer's accountant and subsequently misused to create fake firms. The legal question was whether such misuse could be addressed under the writ jurisdiction of the High Court.

The Bench comprising Justice Prathiba M. Singh and Justice Shail Jain held that the matter was not maintainable under writ jurisdiction and thus declined to entertain the petition. It emphasized that such issues pertaining to misuse and cancellation are better suited for remedy through appropriate administrative or investigative mechanisms, rather than through writ petitions in the High Court.

EQUITY INTELLIGENCE AIF TRUST vs THE CENTRAL BOARD OF DIRECTTAXES & ANR CITATION : 2025 TAXSCAN (HC) 1698

The Delhi High Court ruled that Category III Alternative Investment Funds (AIFs) are not indeterminate trusts simply because investor names are absent from the Trust Deed, as long as beneficial interests are determinable through other means. The Court read down CBDT Circular No. 13/2014 to align with binding judicial precedents.

A Division Bench of Justices Yashwant Varma and Purushaindra Kumar Kaurav set aside the Board for Advance Rulings’ order taxing the AIF at the maximum marginal rate, holding that SEBI regulations prevent inclusion of investor names in the Trust Deed at registration and that investor interests can be identified via contribution agreements and records. The Court allowed the writ petition and clarified that the absence of investor names in the Trust Deed alone does not warrant maximum marginal rate taxation.

Nitin Dwivedi vs State Of U.P CITATION : 2025 TAXSCAN (HC) 1699

The Allahabad High Court granted bail to Nitin Dwivedi, accused in a GST evasion case under Section 132 of the CGST Act, noting the offence is compoundable, the applicant has no criminal antecedents, and is willing to pay the compounding fee.

A bench of Justice Subhash Vidyarthi held that these factors warranted bail without prejudice to the case merits. The court allowed bail on furnishing personal bond and sureties, imposing conditions including no tampering with evidence or witness pressure, and attendance at trial unless exempted.

Gannon Dunkerley and Co Limited vs State Of Chhattisgarh ThroughSecretary Commercial Tax CITATION : 2025 TAXSCAN (HC) 1700

The Chhattisgarh High Court addressed whether a GST appeal filed with a delay of 26 days can be condoned and whether summary rejection of such an appeal without examining the cause of delay and without providing a hearing is permissible under the CGST Act. The issue arose from the rejection of Gannon Dunkerley’s appeal against a demand order, where the authorities dismissed the appeal solely on the ground of delay without considering the merits or reasons for the delay.

A Bench comprising of Justice Deepak Kumar Tiwari held that delays within the condonable period must be liberally construed unless negligence or mala fide is shown. The Court set aside the summary rejection order, condoned the delay, and directed the Appellate Authority to decide the appeal on merits after affording a proper hearing. The judgment emphasized the requirement for reasoned and speaking orders and cautioned against issuing slipshod orders in the pursuit of quick disposal.

M/S Kesarwani Traders vs State Of Up CITATION : 2025 TAXSCAN (HC) 1701

The Allahabad High Court addressed whether Input Tax Credit (ITC) can be denied to a purchasing dealer despite proof of goods movement through a stamped e-Way bill during transit, when the supplier’s GST registration was cancelled after the transaction date. The issue arose from Kesarwani Traders’ challenge to orders under Section 74 of the U.P. GST Act and subsequent recovery notices.

A Division Bench comprising Justice Piyush Agrawal held that the e-Way bill confirmed actual transit and the supplier was registered at the time of the transaction. The Court found that the authorities failed to controvert the petitioner’s evidence, quashed the impugned orders and recovery notice, and directed refund of amounts paid during litigation, allowing the writ petition.

Rounak Int Udyog vs The State of Bihar CITATION : 2025 TAXSCAN (HC) 1702

The Patna High Court addressed the validity of a demand order issued under Section 73 of the Bihar Goods and Services Tax Act, 2017 (BGST Act) against a brick manufacturer, focusing on whether the assessment was based on any technical or factual basis. The issue arose when the Department raised a tax demand for FY 2021-22 against Rounak Int Udyog, a brick manufacturing firm, relying solely on an estimation of coal consumption relative to brick production without correlating this with sales invoices, GST returns, or industry standards.

A Division Bench comprising Justice P. B. Bajanthri and Justice G. Anupama Chakravarthy held that the assessment lacked any technical yardstick, noting the Department failed to apply accepted norms for coal usage or verify its assumptions against supporting documents. The Court set aside the impugned demand order and directed the Department to conduct a fresh reassessment based on technical criteria, granting the petitioner proper hearing within six months. The judgment emphasized the necessity of reasoned, evidence-based assessments and mandated cooperation between parties during reassessment.

Avenue Realty vs Assistant Commissioner CITATION : 2025 TAXSCAN (HC) 1703

The Madras High Court ruled that the Commercial Tax Department qualifies as a ‘secured creditor’ under the Insolvency and Bankruptcy Code (IBC) when statutory charges exist on a corporate debtor’s property. The Court addressed the issue of whether statutory tax dues could be settled through liquidation sales, directing the auction purchaser to recover the purchase price and remit it toward long-pending VAT arrears.

A bench of Justice C. Saravanan held that statutory VAT dues create a secured charge under the IBC, making the Commercial Taxes Department a secured creditor. The auction purchaser bought the property with full knowledge of existing charges and must recover the purchase price from the corporate debtor and settle the VAT arrears. The liquidator is to assist in this recovery, and upon payment, the attachment will be lifted. The writ petition was dismissed.

AMAN VERMA vs COMMISSIONER OF CUSTOMS CITATION : 2025 TAXSCAN (HC) 1704

The High Court of Delhi addressed the legality of detaining a 100-gram gold kada by Customs without issuing a proper Show Cause Notice (SCN), ruling that a pre-printed waiver signed by the petitioner cannot substitute for the mandatory SCN under the Customs Act.

A bench comprising Justice Prathiba M. Singh and Justice Shail Jain held that written notice and an opportunity to be heard are essential before confiscation. They set aside the detention order as unlawful and directed Customs to release the jewelry upon payment of applicable warehousing charges.

ASHILY MUHAMMED SHAMEER vs COMMISSIONER OF CUSTOMS CITATION : 2025 TAXSCAN (HC) 1705

The High Court of Delhi addressed whether the petitioner was entitled to a personal hearing and lawful consideration of his request to re-export a 90-gram gold chain and a 10-gram gold wire detained by Customs without the issuance of a Show Cause Notice (SCN). The issue arose when Ashily Muhammed Shameer challenged the detention of these gold items, arguing that no SCN had been served prior to the detention by the Customs Department upon his arrival from the UAE.

A Division Bench comprising Justice Prathibia M Singh and Justice Shail Jain directed the Adjudicating Authority to grant the petitioner a personal hearing and consider his request for re-export. Observing that the matter did not warrant interference at the writ stage and noting the petitioner’s willingness to re-export the gold, the Court instructed the petitioner to appear before Customs and the nodal officer to facilitate the process.

Foreign National’s 84-gram Gold Chain Detained by Customs without SCN: Delhi HC Quashes Detention, Directs Release

The High Court of Delhi, quashed the detention of a foreign national’s 84-gram gold chain detained by Customs at Indira Gandhi International (IGI) Airport without issuance of a Show Cause Notice ( SCN ) and directed its release.

Justice Prathiba M.Singh and Justice Shail Jain observed that under Section 110 of the Customs Act, 1962, a Show Cause Notice must be issued within one year, and detention beyond that without notice was not allowed. Relying on this principle, the Court quashed the detention and directed the release of the gold chain. The petitioner/pairokar was instructed to appear before the Customs Department on 21st August, 2025, for verification and release, and warehousing charges were to be paid. Accordingly ,the petition was disposed of.

Arjun Amarjeet Rampal vs Income Tax Department & Anr CITATION : 2025 TAXSCAN (HC) 1707

The Bombay High Court addressed the legality of issuing a non-bailable warrant for a bailable offence under Section 276C(2) of the Income Tax Act, which prescribes a maximum punishment of three years. The issue arose from an order by the Additional Chief Metropolitan Magistrate, Mumbai, issuing a non-bailable warrant against Arjun Amarjeet Rampal without proper application of mind.

Justice Advait M. Sethna, presiding over the Vacation Court, held that the offence is bailable and the Magistrate’s cryptic order lacked reasons and ignored the petitioner’s advocate’s presence and exemption application. The Court quashed the non-bailable warrant while allowing the merits of the case to proceed. Further proceedings on earlier process issuance were directed to be heard by a regular bench, with the department required to file a reply before the next hearing.

PATSON PAPERS PRIVATE LIMITED vs UNION OF INDIA & ORS CITATION : 2025 TAXSCAN (HC) 1708

The Gujarat High Court addressed whether refund of unutilised compensation cess input tax credit (ITC) is permissible when goods are exported on payment of Integrated Goods and Services Tax (IGST). The issue arose from the refusal to refund unutilised compensation cess credit paid on inputs used in exported goods.

A Division Bench comprising Justice Bhargav D. Karia and Justice D.N. Ray held that since the exported goods were not subject to compensation cess, the unutilised credit was refundable as per the statute. The Court quashed the rejection orders and directed the refund to be processed, emphasizing that statutory provisions prevail over conflicting circulars.

M/S Vibhuti Tyres vs State of U.P. CITATION : 2025 TAXSCAN (HC) 1709

The Allahabad High Court addressed whether an assessing authority can impose a GST demand exceeding the amount specified in the show cause notice under Section 73 of the GST Act, 2017. The issue arose when Vibhuti Tyres, the petitioner, received a show cause notice dated 29 September 2023 proposing a demand of ₹8,81,080 for the period July 2017 to March 2018, but the final order dated 18 November 2023 demanded ₹32,97,336, including tax, penalty, and interest, without the petitioner filing a reply or appearing before the authority.

A Division Bench comprising Chief Justice Arun Bhansali and Justice Kshitij Shailendra held that Section 75(7) clearly restricts the demand in the adjudication order to the amount specified in the show cause notice. Observing that the final demand was over three times the notice amount, the Court quashed the order and remanded the matter back to the assessing authority. It directed the authority to grant the petitioner an opportunity to reply and pass a fresh order in accordance with law.

Tvl Raj Computer vs The Deputy State Tax Officer -1 CITATION : 2025 TAXSCAN (HC) 1710

The Madurai Bench of the Madras High Court addressed whether a rectification application filed offline within the prescribed time under Section 161 of the GST Act, 2017, can be disregarded for not being filed online as mandated by the CBIC Circular. The issue arose when Tvl Raj Computer, through its proprietor Monaram, filed an offline rectification petition challenging an order under Section 73, which the Deputy State Tax Officer declined to consider citing non-compliance with the online filing requirement.

A bench of Justice C. Saravanan, held that the offline rectification application filed within the statutory time must be considered valid and cannot be rejected on procedural grounds alone. However, in line with the CBIC Circular dated 15.10.2024, the petitioner was directed to additionally file the rectification application online within 30 days. The Court further directed the authority to decide the petition on merits once the online filing is completed, without invoking limitation under Section 161, thereby preserving the petitioner’s substantive rights. The writ petition was disposed of accordingly.

ANURAG DALMIA vs INCOME TAX OFFICE CITATION : 2025 TAXSCAN (HC) 1711

The Delhi High Court addressed whether unauthenticated documents received from France under the Double Taxation Avoidance Agreement (DTAA), without verification from Swiss authorities, can form the basis for criminal prosecution under the Income Tax Act. The issue arose when Anurag Dalmia faced criminal complaints alleging undisclosed foreign bank accounts in Switzerland, based solely on unverified information provided by French authorities.

A bench comprising of Justice Neena Bansal Krishna held that documents lacking authentication or independent verification cannot sustain criminal charges under Sections 276C(1)(i), 276D, and 277 of the Income Tax Act. The Court noted that the ITAT had already quashed the related assessment order due to lack of evidence and that no incriminating material was found during the search. The Court quashed the criminal complaints, ruling that prosecution could not proceed on uncorroborated foreign information and insufficient evidence, thereby allowing the petitioner’s petitions.

Rs. 45 Lakh Income Tax Settlement Bribe Allegations: Punjab and Haryana HC grants Bail to IRS Official

The Punjab and Haryana High Court has granted regular bail to senior Indian Revenue Service (IRS) officer Dr. Amit Kumar Singal, who was arrested by the Central Bureau of Investigation (CBI) in a corruption case linked to an alleged demand of Rs. 45 lakh bribe for settling income tax proceedings.

The order marks a significant development in one of the most prominent corruption cases in the region this year. While Dr. Singal has secured bail, the case will now proceed to trial, where the court will determine the veracity of the bribery allegations.

Continuation of Prosecution u/s 276C(1) Not Valid When Penalty Proceedings on Same Facts Have Been Quashed: Madras HC

In a recent ruling, the Madras High Court held that prosecution under Section 276C(1) of the Income Tax Act cannot continue when the penalty proceedings on the same facts have already been quashed.

The court referred to the Supreme Court’s ruling in Radheshyam Kejriwal v. State of West Bengal, which explained that if the penalty is dropped on merits, the prosecution on the same facts should not continue. The court explained that once the penalty had been set aside by the Tribunal, continuing the criminal case would amount to misuse of the legal process. The court held that the prosecution under Section 276C(1) could not be sustained after the penalty proceedings were quashed. The court quashed the complaints in EOCC Nos. 112 and 113 of 2015. The petitions were accordingly allowed.

6-Year Limitation Period u/s 153C Commences from Date of Material Handover to AO, Not Date of Search or Notice: Madras HC

In a recent ruling, the Madras High Court held that under Section 153C of the Income Tax Act, the six-year limitation period for issuing a notice to a person other than the one searched begins from the date on which the documents or materials are received by the Assessing Officer, not from the date of the search or notice.

The court also observed that the earlier settlement before the Interim Board did not prevent the department from initiating fresh proceedings when new material had been received. It explained that the petitioner’s objections on limitation and finality of settlement had no merit in the present case. The court dismissed the writ petitions.

Cancellation of GST Registration for Non-Filing of Returns for Six Months: Gauhati HC allows Restoration upon Submission of Pending Returns and Dues

The bench also clarified that the period under Section 73(10) of the CGST/State GST Act would be counted from the date of the judgment (except for the financial year 2024-25, which would follow Section 44) and that the petitioner remained liable to pay arrears, including tax, interest, penalty, and late fees. Accordingly the petition was disposed of.

Refund of Excess GST Deposit During Inspection: Chhattisgarh HC Directs Adjustment During Final Adjudication or Against Dues

The High Court of Chhattisgarh, directed that any excess Goods and Service Tax (GST ) deposit made during inspection be adjusted during final adjudication or against dues payable to the petitioner.

Justice Deepak Kumar Tiwari heard both counsels and directed that the amount deposited by the petitioner-firm, if found to be in excess, should be adjusted during final adjudication or against any dues payable in its favour. The court also observed that authorities must complete further action promptly after inspections under Section 71 of the Act of 2017. With these directions, the petition was disposed of.

Dismissal of GST Appeal as Time-Barred: Chhattisgarh HC allows relief under CBIC Circular with stay on Recovery

Hari Shankar Patel vs The StateOf Chhattisgarh Through The Commissioner CITATION : 2025 TAXSCAN (HC) 1717

The High Court of Chhattisgarh,allowed relief in time-barred Goods and Service Tax (GST) appeal under Central Board of Indirect Taxes and Customs ( CBIC ) Circular, granting stay on recovery.

The court considered the submissions and noted the guidelines on recovery of dues until the Appellate Tribunal became operational. It held that nothing remained for adjudication in the writ petition. The petitioner was allowed to file an undertaking under CBIC Circular No.224/18/2024-GST dated 11.07.2024, agreeing to file an appeal before the Appellate Tribunal once it became functional and to pay the required pre-deposit within 30 days. Justice DeepakKumar Tiwari ordered that recovery would remain stayed if the undertaking was filed but clarified that failure to deposit the amount within the given time would make the order ineffective. The writ petition was disposed of accordingly.

Lawyers Not Bound to Verify Truth of Client’s Case Before Representation: Delhi HC

In a recent ruling, the Delhi High Court held that lawyers are not required to verify the truth of their client’s case before representing them in court, and that advocates are bound to act on client instructions.

The court explained that advocates are duty-bound to follow client instructions and pointed out that assessing the truthfulness of pleadings is the role of the court, not of lawyers. The court also observed that the appellant’s concerns regarding alleged perjury and fabrication of documents were already the subject of separate proceedings under Section 340 of the Criminal Procedure Code. The court held that the appeal lacked merit and that there was no illegality or irregularity in the Single Judge’s order. The Letters Patent Appeal was dismissed, with parties directed to bear their own costs.

Filing Form 67 Before Final Income Assessment is Sufficient Compliance: Madras HC Rules Rule 128 Directory, Not Mandatory

VenkatanarayananSomayaji Lakshminarasimha vs The Principal Commissionerof Income Tax-8 CITATION : 2025 TAXSCAN (HC) 1719

The Madras High Court has held that filing Form 67 before completion of final assessment is sufficient compliance for claiming Foreign Tax Credit (FTC), ruling that Rule 128 of the Income Tax Rules is directory and not mandatory. The case concerned Venkatanarayanan Somayaji Lakshminarasimha, whose FTC claim of ₹18.85 lakh for AY 2018–19 was denied on the ground that Form 67 was not filed along with his return, though he later submitted it before assessment was completed.

Justice Krishnan Ramasamy, relying on Duraiswamy Kumaraswamy v. PCIT and CIT v. G.M. Knitting Industries (P) Ltd., set aside the rejection order, observing that a procedural lapse could not defeat a substantive right. The Court condoned the delay, imposed costs of ₹10,000 payable to a government hospital, and directed the Deputy Commissioner to reconsider the FTC claim once proof of payment was furnished.

Taxpayer Pursued Rectification Petition First: Madras HC Condones 108 Days Delay in Filing Appeal

Tvl.Pasura Crop CarePrivate Limited vs The Deputy Commissioner CITATION : 2025 TAXSCAN (HC) 1720

The Madras High Court condoned a 108-day delay in filing an appeal under the TNGST Act, 2017, after noting that the petitioner, Tvl. Pasura Crop Care Pvt. Ltd., had first pursued a rectification petition under Section 161 against an assessment order for AY 2019-20 before approaching the appellate authority. The Deputy Commissioner, Salem, had dismissed the appeal as time-barred despite the petitioner’s explanation and part-payment of the disputed tax.

Justice Krishnan Ramasamy observed that the delay was bona fide and not deliberate, holding that justice would be served by allowing the appeal on terms. The Court set aside the order dated 13 March 2025, directed the petitioner to deposit an additional 5% of the disputed tax within four weeks, and instructed the appellate authority to entertain the appeal and decide it on merits after hearing the petitioner.

GST authorities unaware of Death of Assessee as Heir Continued to File Returns in Deceased’s Name: Gauhati HC order Fresh Proceedings against Legal Rep

The Gauhati High Court has quashed a GST (Goods and Services Tax) demand order issued in the name of a deceased assessee, holding that proceedings against a dead person are a nullity in law. At the same time, the Court permitted the tax authorities to initiate fresh proceedings against the legal heir in terms of Section 93 of the Central Goods and Services Tax Act, 2017.

The bench further directed that the period from May 28, 2024, until the certified copy of the present order is served on the authorities would be excluded from limitation calculations under Section 73. Accordingly, the writ petition was disposed of allowing GST authorities to proceed afresh against the legal representative, after granting due opportunity of hearing.

GST Rectification Order must be Passed by Same Authority that passed Original Order: Delhi HC

M/S GANPATIINTERNATIONAL vs COMMISSIONER OF CGST CITATION : 2025 TAXSCAN (HC) 1722

The Delhi High Court held that rectification of a GST order must be done by the same authority that issued the original order. Ganpati International had challenged an order-in-original (OIO) of 31 January 2025, raising a demand of ₹6.65 lakh over alleged bogus ITC from M/s Swagat Enterprises. The petitioner sought rectification of the OIO, but instead of the CGST Department, the Delhi GST Department passed a rectification order on 24 June 2025.

A Division Bench of Justices Prathiba M. Singh and Shail Jain found the order unsustainable as (1) no personal hearing was given in violation of Section 161 proviso, and (2) rectification was made by the wrong authority. Setting aside the order, the Court directed the CGST Department to rehear the rectification application and grant the petitioner a personal hearing before passing a fresh order.

S. 69 and 70 under GST is not Violative of Article 20(3) or 21, Parliament Competent to Enact such Provisions: Delhi HC follows SC Ruling

DHRUV KRISHAN MAGGU vsUNION OF INDIA CITATION : 2025 TAXSCAN (HC) 1723

The Delhi High Court dismissed writ petitions challenging Sections 69 and 70 of the CGST Act, holding that Parliament has legislative competence under Article 246-A to enact arrest and summons provisions. Petitioners had argued these powers went beyond GST’s “levy and collection” scope and violated Articles 20(3) and 21.

Relying on the Supreme Court’s ruling in Radhika Agarwal v. Union of India (2025), the Court held that prosecution mechanisms to check tax evasion are ancillary to GST laws. The apex court clarified that Article 246-A is comprehensive, covering all incidental matters, and upheld the validity of Sections 69 and 70. Consequently, the petitions were disposed of.

Duplicate GST Demand u/s 63 and 73 Issued for Same Period: Orissa HC declares writ Infructuous as Order Rectified to ‘Nil’ by Dept

Chandra Jakeshika vsChief Commissioner of CT & GST CITATION : 2025 TAXSCAN (HC) 1724

The Orissa High Court declared a writ petition by Chandra Jakeshika infructuous after GST authorities corrected a duplicate demand. The petitioner had challenged an assessment order dated November 7, 2024, under Section 63 of the GST Act, which raised tax liability for April 2020–March 2021 despite the same period already being assessed under Section 73 by a prior order dated September 24, 2024.

During the hearing, the Department admitted the error and confirmed that the November order was rectified, reducing the demand to nil. Noting that the grievance stood redressed, Chief Justice Harish Tandon and Justice Murahari Sri Raman disposed of the petition as infructuous and closed pending applications.

Sikkim HC Quashes GST Order Denying Budgetary Support of Rs. 59L to Zydus Wellness

Zydus Wellness-Sikkimvs The Assistant Commissioner CITATION : 2025 TAXSCAN (HC) 1725

The Sikkim High Court quashed a GST order that denied Zydus Wellness budgetary support of ₹59.44 lakh, terming the Assistant Commissioner’s rejection legally untenable. Zydus had challenged the 27 June 2022 order under Article 226 after its claim under the 2017 Budgetary Support Scheme was rejected on the ground that eligible support was “negative.”

Justice Meenakshi Madan Rai noted that the issue was already settled in Glenmark Pharmaceuticals v. Union of India (2024), which relied on Coromandel International Ltd. v. Union of India (2023), clarifying that support must be calculated on monthly tax payments through the cash ledger. Accordingly, she set aside the order and directed that Zydus’ claim be reconsidered in line with these rulings.

Rajasthan HC Upholds Insertion of New ‘Sleeper Bus’ Tax Category in State Motor Vehicle Tax Rules

In a recent ruling, the Rajasthan High Court upheld the State Government’s authority to insert a new category of “Sleeper Bus” for the purpose of motor vehicle taxation and quashed demand notices issued without following proper legal procedure.

The court partly allowed the writ petitions, holding that the State Government’s insertion of the new “Sleeper Bus” tax category was lawful, but the impugned demand notices were invalid. The respondents were given liberty to initiate fresh proceedings strictly in accordance with law.

Denying Property Tax Exemption to Unaided Schools Not Violative of Art. 14 of Indian Constitution: Kerala HC

REV.FR.DR.ABRAHAM THALOTHIL vs STATE OF KERALA CITATION : 2025 TAXSCAN (HC) 1727

The Kerala High Court ruled that denying property tax exemption to Unaided Schools is not violative of Article 14 of Indian Constitution. The petitioners/assessee are unaided schools or the trust/organizations conducting unaided educational institutions, which are imparting education upto the standard twelve. The issue pertains to the amendment made to the provisions of the Kerala Panchayat Raj Act, 1994 and Kerala Municipality Act, 1994, which deal with the exemption from paying the property tax, to the buildings exclusively used for educational purposes or educational allied purposes under the ownership of such educational institutions.

While dismissing the petition,the court of Justice Ziyad Rahman A.A.held that Government owned, managed aided institutions are providing free education or education at very low cost, the unaided institutions are collecting fees from the students for rendering their services. This itself could be a basis for such classification which would in clear terms, would come within the purview of intelligible differentia.

S.263 of Income Tax Act Can Be Invoked Only in Cases of ‘Lack of Inquiry,’ Not Merely for Inadequate Inquiry: Madras HC Upholds AO’s Order

M/s.Arul Industries vsThe Asst. Commissioner of Income Tax CITATION : 2025 TAXSCAN (HC) 1728

The Madras High Court dealt with the scope of revisional powers under Section 263 of the Income Tax Act, 1961, holding that the provision can be invoked only in cases of complete absence of inquiry and not merely for inadequate inquiry by the Assessing Officer. The case arose from assessment proceedings concerning capital gains treatment and depreciation claims of Arul Industries for AY 2007-08.

A Division Bench comprising Chief Justice Manindra Mohan Shrivastava and Justice Sunder Mohan ruled that since the Assessing Officer had examined the records, considered the property purchase, and discussed the matter with the assessee’s representative, the case was one of inadequate inquiry at best. Consequently, the Court held that the Commissioner had no jurisdiction to invoke Section 263, allowed the assessee’s appeal, and answered the question of law in its favour.

Six Months Custody or Trial Delay not Sufficient Ground for Bail in Economic Offences under PMLA: Jharkhand HC

Pramod Kumar Singh vsUnion of India CITATION : 2025 TAXSCAN (HC) 1729

The Jharkhand High Court dealt with the issue of whether six months of custody or trial delay is sufficient ground for bail in economic offences under the Prevention of Money Laundering Act, 2002, while considering Pramod Kumar Singh’s application under Sections 483 and 484 of the BNSS, 2023, linked to misappropriation of NRHM funds.

Justice Sujit Narayan Prasad held that money laundering is a grave economic offence, and bail requires compliance with Section 45 of the PMLA. Since Singh failed to discharge the statutory burden under Section 24 or satisfy the twin conditions, the court dismissed his bail plea, clarifying that observations were confined to bail and not the trial merits.

Delhi HC Refuses Bail to 64 Years Old Senior Citizen in PMLA Case, Holds Health Grounds Alone Cannot Justify Release

ARVIND DHAM vsDIRECTORATE OF ENFORCEMENT CITATION : 2025 TAXSCAN (HC) 1730

The Delhi High Court examined whether health grounds alone could justify bail in serious money laundering cases under the Prevention of Money Laundering Act, 2002. The petition, filed by Arvind Dham, former promoter of the Amtek Group of Companies, arose from ECIRs linked to the diversion of over ₹26,000 crores of public funds through Amtek Auto Ltd. and its group companies. The application was moved under Section 483 of the BNSS, 2023, read with Section 45 of the PMLA.

Justice Ravinder Dudeja, sitting as a single-judge bench, dismissed the bail plea, holding that age and health concerns could not outweigh the gravity of the charges. The court emphasized that under Section 45 of the PMLA, bail cannot be granted unless the accused demonstrates reasonable grounds of innocence, which Dham failed to establish. Observing that medical facilities could be provided in custody and that no exceptional circumstances existed, the Court concluded that the magnitude of the fraud and its impact on public banks warranted denial of bail, clarifying that the findings were limited to the bail stage.

AO Not Bound by Municipal Rateable Value, Can Fix Fair Rent Independently u/s 23(1)(a) Income Tax Act: Bombay HC

Tivoli Investment &Trading Co. Pvt. Ltd vs The AssistantCommissioner of Income-tax and another CITATION : 2025 TAXSCAN (HC) 1731

The Bombay High Court examined whether the Assessing Officer is bound to accept the municipal rateable value while determining the annual letting value under Section 23(1)(a) of the Income Tax Act, 1961. The case arose from Tivoli Investment and Trading Company Pvt. Ltd., which had let out an office premises at Sakhar Bhavan, Nariman Point, to Citi Bank at a nominal license fee of ₹9,825 per month, alongside an interest-free security deposit of ₹1.54 crores. For AY 1990-91, the assessee declared only ₹1,17,900 as rental income based on the license fee.

The Division Bench of Justice K.R. Shriram and Justice Neela Gokhale dismissed the assessee’s appeal, holding that municipal rateable value is not binding where it does not reflect fair rent. While clarifying that notional interest on security deposits cannot be directly taxed, the Court noted that the low license fee and high security deposit concealed the true rental yield. It upheld the Assessing Officer’s determination of ₹22,00,000 as fair annual letting value based on comparable rentals, rejecting both the nominal license fee and the municipal valuation as unrepresentative.

Time Extension by Supreme Court During COVID Meant for Litigants, Not Authorities: Andhra Pradesh HC quashes GST Revisional Order

GUPTHAS CONSTRUCTIONSCOMPANY vs THE JOINT COMMISSIONER CITATION : 2025 TAXSCAN (HC) 1733

The Andhra Pradesh High Court dealt with whether the GST Department could pass a revisional order beyond the three-year limit under Section 108(2) of the AP GST Act, holding that the Supreme Court’s COVID-19 extension orders applied to litigants, not revenue authorities.

A Division Bench of Justices R. Raghunandan Rao and T.C.D. Sekhar set aside the revisional order dated 15.02.2025 as time-barred, ruling that statutory powers cannot be enlarged by pandemic extensions, and allowed the writ petition without costs.

Cooperative Society’s writ on Status of Cooperative Bank for S.80P Deduction Dismissed: Madras HC Says No Decision Possible without its Presence

Muhavoor PrimaryAgricultural Cooperative Socieity Ltd vs The AssessmentUnit,Income TaxDepartment CITATION : 2025 TAXSCAN (HC) 1734

The Madras High Court dealt with a writ appeal filed by Q.837, Muhavoor Primary Agricultural Cooperative Society Ltd., challenging the disallowance of deduction under Section 80P of the Income Tax Act, 1961, on interest earned from investments in the Virudhunagar District Central Cooperative Bank. The legal issue centered on whether the said bank should be treated as a “Cooperative Bank” or a “Cooperative Society” for the purpose of Section 80P(2)(a)(i).

A Division Bench of Justices G.R. Swaminathan and K. Rajasekar dismissed the appeal, holding that no pronouncement could be made on the status of the Virudhunagar District Central Cooperative Bank without it being impleaded as a party.

GST Penalty u/s 122 imposed for Fake Invoice Issuance: Madras HC directs to file Reply on 25% deposit, Quashes Penalty Order

P. G. Metal vs AssistantCommissioner CITATION : 2025 TAXSCAN (HC) 1735

The Madurai Bench of the Madras High Court dealt with a writ petition by P.G. Metal, challenging an assessment order dated 26.02.2025 and a penalty order dated 06.03.2025 under Section 122(1)(vii) of the GST Act. The dispute arose from allegations that the petitioner issued bogus invoices to fraudulently avail and pass on Input Tax Credit (ITC), leading to a penalty of ₹2,00,736/-.

Justice C. Saravanan quashed the penalty, observing that there was no written record of the petitioner’s alleged admission and that principles of natural justice required an opportunity to file a reply to the show cause notice. The Court directed the petitioner to deposit 25% of the disputed tax within thirty days, allowed a reply to be filed treating the penalty order as an addendum, and remanded the matter for a fresh decision on merits within three months.

Non Refund of excess Consent charges paid to BDA: Orissa HC directs to allow Refund based on report of Approved Valuer of Income Tax Dept

Ratnakar Baral vs BBSRDevelopment Authority CITATION : 2025 TAXSCAN (HC) 1737

The Calcutta High Court heard a writ by Ratnakar Baral challenging BDA’s refusal to refund excess consent charges on transfer of a plot. He argued the charges were wrongly computed by including the structure’s value, contrary to BDA’s 2015 order, and relied on Section 72 of the Contract Act and Mafatlal Industries to claim that excess money cannot be retained by the State.

Justice Dixit Krishna Shripad quashed BDA’s order and directed valuation of the plot by an Approved Valuer of the Income Tax Department, with costs on the petitioner. BDA was ordered to refund any excess within two weeks, failing which 1% monthly interest would apply, recoverable from erring officials.

Co-op Society Seeks Unblocking/Defreezing of Fixed Deposits to Pay Income Tax Dues: Uttarakhand HC Leaves Decision to Registrar

GARHWAL SAINIK SAHKARISAMITI LTD vs SECRETARY DEPARTMENT OF COOPERATIVE STATE OF UTTARAKHAND &OTHERS CITATION : 2025 TAXSCAN (HC) 1738

The Uttarakhand High Court dealt with a writ petition filed by Garhwal Sainik Sahkari Samiti Ltd., a cooperative society for army veterans, seeking unfreezing of its fixed deposits with the District Cooperative Bank to pay Income Tax dues. The petitioner challenged a June 26, 2020 letter restricting funds and sought directions under the Co-operative Societies framework to ensure proper monitoring and prevent misuse.

Justice Manoj Kumar Tiwari held that approval of fund release rested exclusively with the Registrar of Cooperative Societies and the Court could not compel the authority’s discretion. The writ was dismissed with liberty to the petitioner to file a representation before the Registrar within three weeks, to be decided within six months.

IREO MD Lalit Goyal Already Went to US and Returned: Punjab & Haryana HC Dismisses ED’s PMLA Travel-Ban Petition as Infructuous

DIRECTORATE OFENFORCEMENT vs LALIT GOYAL CITATION : 2025 TAXSCAN (HC) 1739

The Punjab and Haryana High Court dealt with a petition by the Enforcement Directorate (ED) under Section 528 of the Bharatiya Nagarik Suraksha Sanhita, 2023, challenging the Special Judge (PMLA), Panchkula’s order permitting Lalit Goyal, Managing Director of IREO and accused under the Prevention of Money Laundering Act, 2002, to travel to the USA for medical treatment.

Justice Manjari Nehru Kaul dismissed the plea as infructuous, noting that Goyal had already travelled abroad and returned. The Court clarified that the earlier safeguards imposed on his travel remain intact, and once the permitted journey is concluded, the ED’s attempt to restrain such travel cannot be sustained.

Issuance of Form ‘C’ for Inter-State Sales: Delhi HC allows Rectification of DVAT Returns but Keeps Relief Suspended Pending SC Appeal

K R ANAND vsCOMMISSIONER OF STATE GOODS AND SERVICE TAX CITATION : 2025 TAXSCAN (HC) 1740

The Delhi High Court dealt with the issue of rectification of returns under the Delhi Value Added Tax Act, 2004. The petitioner, Vijay Screw House, filed a writ under Articles 226 and 227 of the Constitution seeking permission to revise DVAT returns for the first quarter of 2013-14 to enable the issuance of statutory Form ‘C’ for inter-State sales, in light of the pending appeal in Ingram Micro India Pvt. Ltd. before the Supreme Court.

The Division Bench of Justice Prathiba M. Singh and Justice Shail Jain allowed the petitioner to rectify the DVAT returns for 2013-14 and directed that Form ‘C’ be issued accordingly. However, consistent with earlier rulings in similar cases, the Court clarified that the relief would remain suspended until the Supreme Court pronounces judgment in the pending Ingram Micro appeals.

Delhi HC directs Processing of ₹14.10 Lakh GST ITC Refund under Inverted Tax Structure within Three Weeks with Interest

PREM POLYMERS vs SALESTAX OFFICER CLASS II/AVATO CITATION : 2025 TAXSCAN (HC) 1741

The Delhi High Court dealt with a petition filed under Section 54 of the Central Goods and Services Tax (CGST) Act, 2017, concerning the non-processing of a refund claim of ₹14.10 lakh filed by Prem Polymers. The refund was sought for accumulated Input Tax Credit (ITC) due to the inverted tax structure for the period April 2024 through Form GST RFD-01, the prescribed mechanism under the CGST Rules, 2017.

The Division Bench of Justice Prathiba M. Singh and Justice Shail Jain directed the GST Department to process the refund claim and release ₹14.10 lakh to the petitioner along with applicable interest. The Court further ordered that the refund order be issued within three weeks, thereby disposing of the petition.

GST Refund Cannot Be Withheld u/s 54(11) Without Pending Appeal: Delhi HC Directs Payment with Interest

OMEGA QMS vsCOMMISSIONER,CGST, DELHI WEST &ANR CITATION : 2025 TAXSCAN (HC) 1742

The High Court of Delhi dealt with the issue of whether the Department could withhold a GST refund under Section 54(11) of the Central Goods and Services Tax (CGST) Act, 2017, without any pending appeal or proceeding. The petitioner, Omega QMS, had been granted a refund of ₹83,46,169 by the Appellate Authority, but the Department withheld it on the basis of a review order, despite no appeal having been filed.

The Division Bench of Justice Prathiba M. Singh and Justice Shail Jain held that the Department’s mere intention to appeal could not justify withholding the refund under Section 54(11). Relying on G.S. Industries and Shalender Kumar, the Court directed the release of the refund with applicable interest under Section 56 by 30th September 2025, while clarifying that any future appeal would govern the refund’s final outcome.

Excess Stock calls for Proceedings u/s 73/74 of GST Act: Allahabad HC quashes Order u/s 130

M/S J.T.Steel Tradersvs - State Of U.P CITATION : 2025 TAXSCAN (HC) 1743

The Allahabad High Court examined whether the discovery of excess stock during a survey could justify proceedings under Section 130 of the Goods and Services Tax (GST) Act, 2017. The authorities had initiated confiscation and penalty proceedings against M/s J.T. Steel Traders under Section 130 based on “eye measurement” of stock during a survey, despite the fact that Sections 73 and 74 specifically provide for determination of tax not paid, short paid, or wrongfully availed input tax credit in such circumstances.

Justice Piyush Agrawal quashed the penalty orders passed by the Deputy Commissioner (9 January 2020) and the Additional Commissioner (31 May 2022), holding that proceedings under Section 130 were unsustainable in the absence of intent to evade tax. Relying on rulings such as Vijay Trading Company, Shree Om Steels, Metenere Ltd., and Maa Mahamaya Alloys Pvt. Ltd., the Court directed that cases of excess or unaccounted stock must instead be adjudicated under Sections 73 or 74 of the GST Act, reaffirming that Section 130 cannot be stretched to cover mere stock discrepancies.

IGST Refund Pleas Dismissed: Madras HC holds Debit from ECRL is Mandatory Requirement while Filing Refund Application

M/s.Pallava TextilesPrivate Limited vs The State Tax Officer (ST) CITATION : 2025 TAXSCAN (HC) 1744

The Madras High Court dealt with the issue of refund eligibility under Section 54 of the Central Goods and Services Tax (CGST) Act, 2017, particularly whether refund applications filed without debiting the Electronic Credit Ledger (ECRL) could be sustained. A batch of writ petitions was filed by textile exporters challenging rejection of their Integrated Goods and Services Tax (IGST) refund claims for 2021–2023, which were denied on grounds of non-debit of refund amounts from the ECRL and being barred by limitation.

Justice Krishnan Ramasamy dismissed the writ petitions, holding that debit from the Electronic Credit Ledger is a mandatory statutory requirement and its absence renders refund claims unsustainable. The Court further observed that issues of eligibility and document verification are factual in nature and fall within the appellate authority’s jurisdiction. Accordingly, while rejecting the petitions, the Court granted liberty to the petitioners to file statutory appeals within four weeks, directing that such appeals, if otherwise in order, be entertained.

12% vs 18% GST on Works Contract Executed before 2022: Madras HC Directs Contractor to Submit Evidence before Dept for Re-confirming Demand

V.Janarthanan vs TheState Tax Officer CITATION : 2025 TAXSCAN (HC) 1745

The Madurai Bench of the Madras High Court addressed the issue of the applicable GST rate on a works contract executed before the 2022 rate revision. The dispute involved Section 74 of the CGST Act, 2017, where the department raised a demand asserting tax at 18% instead of 12% under Notification No. 03/2022-Central Tax (Rate) dated 13.07.2022, while the petitioner contended that the work was completed in 2020 and only invoiced later to regularize records.

Justice C. Saravanan observed that the key question was whether the work was completed before the notification increasing the GST rate. The Court quashed the impugned order insofar as it related to the higher rate and directed the department to reassess after giving the petitioner an opportunity to submit documentary proof of completion prior to July 2022. The Court allowed the petitioner to challenge any penalty under Section 74 after the fresh assessment.

Fault Lies with Auditor, Not Assessee or GST Dept: Madras HC Quashes Ex Parte Order Passed for Non-Reply

M/s.Siva Cotton vs TheState Tax Officer (FAC) CITATION : 2025 TAXSCAN (HC) 1746

The Madras High Court examined the validity of an assessment order under the Goods and Services Tax (GST) Act, passed against M/s Siva Cotton for non-filing of a reply.

Justice Krishnan Ramasamy held that while the tax authority had granted opportunities for compliance, the default stemmed from the auditor’s negligence. The Court observed that the assessee should not suffer for the auditor’s fault, and accordingly set aside the assessment order. The matter was remanded to the State Tax Officer for fresh consideration, subject to the petitioner depositing an additional 15% of the disputed tax within two weeks, over and above the 10% already paid.

₹11 crore GST Evasion case: Jharkhand HC grants Bail considering Prolonged Period of Custody

Kumar Luv Agarwal vsUnion of India represented by Shri Saket CITATION : 2025 TAXSCAN (HC) 1747

The High Court of Jharkhand dealt with the question of bail in a Goods and Services Tax (GST) evasion case under Sections 132(1)(b), 132(1)(c), and 132(5) of the Central Goods and Services Tax Act, 2017. The petitioner, Kumar Luv Agarwal, was accused in Complaint Case No. 2933 of 2025 before the Special Judge, Economic Offences, Jamshedpur, for allegedly evading ₹11 crore in GST from the financial year 2021 onwards.

Justice Ambuj Nath, considering the petitioner’s custody of over two months and the maximum punishment of five years prescribed under the Act, granted bail. The Court directed his release on furnishing bail bonds of ₹20,000 with two sureties of the same amount, to the satisfaction of Shri Abhishek Prasad, Special Judge, Economic Offences, Jamshedpur.

Delayed GST ITC Claim: Karnataka HC Holds Reply to SCN Not Necessary when Records available with Dept

M/S. SRI.NANJUNDESHWARA TRADERS vs COMMISSIONER OF COMMERCIAL TAXES CITATION : 2025 TAXSCAN (HC) 1748

The Karnataka High Court held that non-filing of a reply to a show-cause notice cannot by itself justify an adverse GST order if all necessary records are already with the department, as these enable the authority to verify claims independently.

In M/s Sri Nanjundeshwara Traders’ case, the Court quashed an adjudication order disallowing ITC claimed belatedly, ruling that reconciliation of ITC can be based on departmental records without necessarily requiring a taxpayer’s reply, and remanded the matter for fresh consideration.

Income Tax Notice u/s 12AB(4)(a) Unsustainable During Pending Challenge to FCRA Certificate Cancellation: Delhi HC quashes Notice against CHRI

COMMONWEALTH HUMANRIGHTS INITIATIVE vs COMMISSIONER OF INCOME TAX CITATION : 2025 TAXSCAN (HC) 1749

The Delhi High Court dealt with the issue of whether the Income Tax Department could invoke Section 12AB(4)(a) of the Income Tax Act, 1961 to cancel the registration of the Commonwealth Human Rights Initiative (CHRI) solely on the ground that its FCRA certificate had been cancelled by the Ministry of Home Affairs.

A Bench of Justice V. Kameswar Rao and Justice Vinod Kumar accepted this contention, holding that the notice issued under Section 12AB was premature while the FCRA cancellation remains sub judice. The Court quashed the impugned notice, while clarifying that the authorities would be at liberty to initiate fresh proceedings depending on the final outcome of the challenge to the FCRA cancellation.

Unaccounted Sales Addition Based on 89% Estimated Yield Found Unsustainable without Evidence: Chhattisgarh HC dismisses Revenue’s Appeal

The Deputy Commissionerof Income Tax vs M/s Abhishek Steel IndustriesLtd CITATION : 2025 TAXSCAN (HC) 1750

The Chhattisgarh High Court examined whether additions under Section 153A r.w.s. 143(3) of the Income Tax Act, 1961 could be sustained when based on an 89% estimated yield without tangible evidence. The case followed a search on Abhishek Steel Industries Ltd., where the AO added ₹11.68 crore alleging suppressed yield, despite no disclosed or proven benchmark.

A Division Bench of Justices Sanjay K. Agrawal and Sachin Singh Rajput upheld the CIT(A) and ITAT’s deletion of the addition, ruling that the AO’s action was conjectural. Citing Dhakeswari Cotton Mills Ltd. v. CIT, the Court dismissed the Revenue’s appeal, holding the assessee’s declared yield—above industry average and backed by excise records—required no interference.

Written Approval with Recorded Reasons by Competent Authority Mandatory for Arrest under CGST Act: Delhi HC

MR. AZAD MALIK vs DGGI,MEERUT ZONAL UNIT CITATION : 2025 TAXSCAN (HC) 1751

The Delhi High Court heard Azad Malik’s anticipatory bail plea under Section 70 of the CGST Act, arising from summons issued during an investigation against M/s Eco Fly E-Waste Recycling Pvt. Ltd., where he was Director. He claimed the summons were harassment, creating apprehension of arrest, and relied on Vinay Kant Ameta and Radhika Agarwal to argue that custodial interrogation was unnecessary.

Justice Dr. Swarana Kanta Sharma held that mere fear of arrest was insufficient under Gurbaksh Singh Sibbia, and since arrest required prior written approval from the competent authority, the application was premature and dismissed.

Income Tax Dept Appeals ITAT Ruling on Clifford Chance’s India Tax Liability in Delhi HC

Clifford Chance PTE Ltdvs ACIT CITATION : 2025 TAXSCAN (HC) 1752

The Income Tax Department has approached the Delhi High Court against ITAT’s ruling in Commissioner of Income Tax vs. Clifford Chance PTE Ltd. (ITA 353/2025 & 354/2025), challenging whether the Singapore arm of the firm had a permanent establishment in India and whether its Indian revenues were taxable under the India-Singapore DTAA.

The two-member ITAT bench of BRR Kumar and Astha Chandra held that Clifford Chance lacked a permanent establishment, as employee presence was below the 90-day DTAA threshold, and struck down tax and interest claims under Section 234B. The matter is now pending before Delhi High Court division bench of Justices V Kameswar Rao and Vinod Kumar.

State GST Officers Authorised to Function as Proper Officers under IGST and CGST: Allahabad HC

Shree Maa TradingCompany vs State Of U.P. CITATION : 2025 TAXSCAN (HC) 1753

The Allahabad High Court addressed the authority of officers appointed under the State GST Act to act as proper officers for Integrated GST and Central GST. The case involved writ petitions by Shree Maa Trading Company challenging seizure and penalty orders under Section 129 of the GST Act for goods intercepted in interstate transit. The petitioner argued that the goods were accompanied by proper documents and that State GST authorities lacked jurisdiction without a notification under Section 4 of the IGST Act.

Justice Piyush Agrawal observed that the petitioner failed to produce any supporting documents at the time of detention and that the driver’s explanation was unsubstantiated. The Court held that under Section 4 of the IGST Act, State GST officers are automatically deemed proper officers for IGST and CGST, and the seizure and penalty proceedings under Section 129 were valid. As the transactions were found to be fictitious and ownership of genuine goods was not proven, the writ petitions were dismissed.

Relief to Gujarat Technological University: ITAT Condones Delay in Filing Form 10B, citing Income Tax Portal DifficultiesGujarat TechnologicalUniversity vs The DCIT CITATION : 2025 TAXSCAN (HC) 1754

The Income Tax Appellate Tribunal (ITAT), Ahmedabad bench, addressed the Gujarat Technological University’s claim for exemption under Section 11 of the Income Tax Act, 1961, despite delay in filing Form No. 10 and Form No. 10B. The CPC and CIT(A) had denied the exemption solely on account of this delay, although the assessee had otherwise fulfilled all substantive conditions, was duly registered under Section 12AA, and had filed the forms belatedly with a bona fide explanation citing portal difficulties and professional negligence.

A two-member ITAT bench comprising Suchitra Kamble and Makarand V. Mahadeokar held that the delay was bona fide and should be condoned in the interest of substantial justice. The Tribunal set aside the orders of the CPC and CIT(A) and directed the Assessing Officer to condone the delay and grant the exemption under Section 11, subject to verification of other statutory conditions, which were already satisfied.

Turnover and size have Impact on comparability: Karnataka HC Upholds exclusion of Infosys & TCS Citing size & turnover

THE PR. COMMISSIONER OFINCOME TAX vs ROBERT BOSCH ENGINEERING CITATION : 2025 TAXSCAN (HC) 1755

The Karnataka High Court examined a transfer pricing dispute under Section 92CA of the Income Tax Act, 1961, in Robert Bosch Engineering and Business Solutions Pvt. Ltd. The issue was whether large companies like Infosys BPO and TCS E-Services, with higher turnover and risks, could serve as comparables for a smaller captive service provider in determining Arm’s Length Price (ALP) under TNMM.

The Division Bench of Chief Justice Vibhu Bakhru and Justice C.M. Joshi upheld the ITAT’s exclusion of companies whose software/IT services contributed less than 75% of total revenue, ruling that segment-level financials cannot bypass this filter. The Revenue’s appeal was dismissed, affirming the proper application of comparability standards.

Chhattisgarh HC upholds Jurisdiction of Stamp Collector for Market Value of Immovable Property Transferred under Income Tax Act

Nuvoco VistasCorporation Limited vs The State Of Chhattisgarh CITATION : 2025 TAXSCAN (HC) 1756

The Chhattisgarh High Court addressed the jurisdiction of the Collector of Stamps under the Income Tax Act, 1961, in determining the market value of immovable property transferred through a deed of conveyance. The issue arose when Nuvoco Vistas Corporation Limited challenged the Collector’s authority after participating in proceedings related to stamp duty assessment under Section 230A of the Act.

The Division Bench of Chief Justice Ramesh Sinha and Justice Bibhu Datta Guru upheld the Single Judge’s order, observing that the petitioner had accepted the Collector’s jurisdiction by cooperating in the enquiry. The Court held that the petitioner could pursue appeals before the Collector, but the writ challenging jurisdiction was impermissible, and dismissed the appeal.

Allegation of using Personal Bank account of Employees for Income Tax Benefit: Gujarat HC dismisses petition to quash FIR

JALDIP JITENDRAKUMARDAVE vs STATE OF GUJARAT CITATION : 2025 TAXSCAN (HC) 1757

The Gujarat High Court dealt with a petition under Articles 226 and 227 of the Constitution read with Section 528 of the BNSS, 2023, seeking quashing of an FIR (C.R. No.11191042250198/2025) registered at Satellite Police Station, Ahmedabad. The FIR alleged offences under Sections 316(2), 316(4), 318(4), 336(2), 338, 339 and 61(2) of the Bharatiya Nyaya Sanhita, 2023, involving misappropriation of ₹1.64 crore by siphoning company funds, forging signatures, and using employees’ bank accounts for income tax benefits.

Justice Hasmukh D. Suthar dismissed the petition at the admission stage, holding that prima facie offences were made out and the allegations could not be quashed at the initial stage of investigation. The Court emphasized that the role of the judiciary is not to interfere with police powers of investigation and relied on Emperor v. Khwaja Nazir Ahmed to reiterate that statutory rights of investigation must be respected.

Common Area Maintenance Charges Paid to Mall is not Construed as ‘Rent’ for the Purposes of TDS: Delhi HC

COMMISSIONER OF INCOMETAX-TDS-01 vs DIAMOND TREE CITATION : 2025 TAXSCAN (HC) 1758

The Delhi High Court examined whether Common Area Maintenance (CAM) charges paid by tenants to mall owners qualify as “rent” for TDS deduction under Section 194I of the Income Tax Act, 1961.

The Division Bench of Justice V. Kameswar Rao and Justice Vinod Kumar upheld the ITAT’s view, relying on Kapoor Watch Company Pvt. Ltd., Connaught Plaza Restaurants Pvt. Ltd. and the High Court’s precedent in CIT (TDS)-1 v. Liberty Retail Revolutions Ltd. (2023). The Court held that CAM charges, being payments for maintenance and upkeep of common facilities, fall under Section 194C as contractual payments and not under Section 194I as rent, thereby relieving the assessee from higher TDS liability.

Imposition of Penalty Without Hearing Violates Principles of Natural Justice: Allahabad HC

M/S Sriram Traders vsState Of U.P CITATION : 2025 TAXSCAN (HC) 1759

The Allahabad High Court at Lucknow dealt with the issue of levy of penalty under Section 125 of the Goods and Services Tax (GST) Act. Sriram Traders, through proprietor Ajay Kumar Gupta, filed a writ petition challenging the penalty order of ₹50,000 dated 20 January 2023.

The single-judge bench of Justice Pankaj Bhatia allowed the writ petition. The Court held that the impugned order, passed without affording the petitioner a hearing, violated the principles of natural justice and could not be sustained. Consequently, the order was quashed, and the matter was remanded to the concerned authority for a fresh decision after providing due opportunity of hearing.

No Perversity or Bias in Disciplinary Findings Against Commercial Taxes Officer: Madras HC Dismisses Petition

V.Mahendhiran vs TheGovernment Of Tamil Nadu Principal Secretary ToGovernment CITATION : 2025 TAXSCAN (HC) 1760

The Madras High Court dealt with the issue of disciplinary proceedings against a Commercial Taxes officer under service rules, specifically examining whether delay in enquiry, alleged perversity in findings, and proportionality of punishment could warrant judicial interference. The petitioner, V. Mahendhiran, challenged the penalty of stoppage of increment for two years without cumulative effect, imposed for dereliction of duty and insubordination.

Justice C. Kumarappan held that the charges failure to scrutinize 365 returns, refusal to receive a departmental memo, and poor performance in a refresher test stood duly proved. The Court observed that while there was delay in the disciplinary process, no prejudice was shown, and judicial review cannot reappreciate evidence. Concluding that the punishment was neither perverse nor disproportionate, the Court dismissed the writ petition and upheld the penalty.

Penalty u/s 125 of GST Cannot Be Levied When Late Fee u/s 47 Already Imposed: Madras HC

Tvl. Sri Ganesh MuruganModern Rice Mill vs The State Tax Officer CITATION : 2025 TAXSCAN (HC) 1761

The Madras High Court examined whether penalty under Section 125 of the GST Act can be imposed when a late fee under Section 47 is already levied. Tvl. Sri Ganesh Murugan Modern Rice Mill challenged an ex parte assessment order, arguing that only portal notices were issued without physical service and that dual levy of late fee and penalty was impermissible, relying on Tvl. Jainsons Castors & Industrial Products v. Assistant Commissioner (ST), Chennai.

Justice Krishnan Ramasamy set aside the order and remanded the matter for fresh consideration. The Court held that notices were improperly served, directed the petitioner to deposit the late fee within three weeks, required a 14-day hearing notice before fresh orders, and ordered defreezing of the bank account upon payment proof.

2% TDS demand issued against CHA, No Proof Filed for Exemption: Madras grants Final Opportunity

Shri Prasad ShippingPrivate Limited vs The Commissioner of Income Tax CITATION: 2025 TAXSCAN (HC) 1762

The Madras High Court granted a final opportunity to a Customs House Agent (CHA) to prove that it was not liable to deduct TDS on reimbursements of ₹4.06 crore incurred on behalf of importers. The Income Tax Department had treated these expenses, including customs duty and freight charges, as the assessee’s income for AY 2016-17 and demanded TDS under Sections 201/201A.

Justice Krishnan Ramasamy set aside the orders and remanded the matter to the Assessing Officer. The Court directed the assessee to submit all supporting records within two weeks and instructed the AO to grant a personal hearing with seven days’ notice before passing a fresh order on merits.