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

M/S PIDILITE INDUSTRIES LTD vsTHE COMMISSIONER OF COMMERCIAL TAX CITATION : 2025 TAXSCAN (HC) 1799

The Madhya Pradesh High Court addressed the classification of Steel Grip Insulating Tape manufactured by Pidilite Industries Ltd. under the MP VAT Act. The legal issue concerned whether the product should be taxed under Entry 50, Part II, Schedule II as an “insulator” (4–5% tax) or under the residuary entry of Part IV, Schedule II (12.5–13%), with the petitioner challenging retrospective application of the higher tax.

A Division Bench of Justices Vivek Rusia and Binod Kumar Dwivedi held that the tape’s primary function is insulation, with adhesive properties being secondary. The Court set aside the Commissioner’s order, ruling that the specific entry for insulators prevails over the residuary entry, and allowed the writ petition, applying the lower tax rate of 5% in favor of the assessee.

Hikal Limited vs Union of India CITATION : 2025 TAXSCAN (HC) 1800

The Bombay High Court addressed the legal issue of the effect of omission of Rules 89(4B) and 96(10) of the CGST Rules on pending proceedings. The Court examined whether pending show cause notices, adjudication orders, or appeals based solely on these rules could survive after their repeal without a savings clause, in light of Section 6 of the General Clauses Act and provisions under the CGST Act.

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The bench of Justices Jitendra Jain and M.S. Sonak held that, in the absence of any express savings clause, the omission of the rules rendered all pending proceedings lapsed, except for “transactions past and closed.” Relying on precedents such as Rayala Corporation and Kolhapur Cane Sugar Works, the Court clarified that Section 6 of the General Clauses Act does not apply to rules made under delegated legislation. The petitions were allowed to the extent of quashing pending proceedings, and refund applications rejected solely under the omitted rules were directed to be reconsidered on merits.

M/s.New Shivsakthi Traders vsThe Assistant Commissioner (ST) CITATION : 2025 TAXSCAN (HC) 1801

The Madurai Bench of the Madras High Court dealt with a writ petition challenging the imposition of late fees under Section 47(2) of the Tamil Nadu GST Act, 2017 for non-filing of the annual return in Form GSTR-9 for FY 2021-22. The petitioner, M/s New Shivsakthi Traders, contended that the notice was issued without following Form GSTR-3A under Section 46 and Rule 68, and that the Circular No.129/19-GST vitiated the legitimacy of the fee.

Justice C. Saravanan held that Section 44(2) bars filing of annual returns beyond three years, making the petitioner liable for the late fee regardless of the procedural objections. The Court observed that Section 47(2) prescribes ₹100 per day (capped at 0.25% of turnover) and dismissed the petition, confirming the penalty and related proceedings.

The Commissioner of Customs vsShri R.K. Swami Singh CITATION : 2025 TAXSCAN (HC) 1802

The High Court of Manipur dealt with the legal issue of whether an appeal filed by the Revenue against the confiscation of 2002.26 grams of gold could be maintained, considering the monetary threshold prescribed under the Ministry of Finance Instruction dated 02.11.2023. The case concerned alleged smuggling under Sections 110, 111(b)(d), and 112(b)(ii) of the Customs Act, 1962, with total value of the seized gold and imposed penalty amounting to less than ₹1 crore.

The bench of Chief Justice K. Somashekar and Justice A. Guneshwar Sharma held that since the total value of the gold bars (₹49,74,605) plus penalty (₹10,00,000) fell below the ₹1 crore threshold for filing an appeal before the High Court, the Revenue’s appeal was not maintainable. The Court dismissed the appeal on this ground, reaffirming the applicability of the financial limits prescribed for appeals in customs matters and noting that smuggled goods are not covered under exceptions allowing appeals irrespective of monetary thresholds.

VIVEK KUMAR SINGH vsCOMMISSIONER OF CUSTOMS A G CITATION : 2025 TAXSCAN (HC) 1803

The Delhi High Court set aside a ₹2 lakh penalty imposed on Vivek Kumar Singh, a 19-year-old national-level taekwondo player, under the Customs Act, 1962, for allegedly carrying smuggled gold. The penalty arose from an order of the Commissioner of Customs (Delhi Airport) dated 31 March 2025, which had confiscated gold chains and rings brought from Bangkok by the petitioner and his teammates under the direction of their coach, Mr. Satwinder Singh, declaring them ineligible for exemption under Notification No. 50/2017-Cus and the Baggage Rules, 2016.

The Bench of Justice Prathiba M. Singh and Justice Shail Jain held that the petitioner was a young athlete acting under the influence of his coach, who had already admitted his role in the smuggling. Accepting the coach’s apology and considering the petitioner’s age, the Court set aside the penalty, clarifying that it would not stigmatise him or affect his sporting career.

NATIONAL ALUMINIUM COMPANYLIMITED vs COMMISSIONER OF DELHI GOODS ANDSERVICE TAX CITATION : 2025 TAXSCAN (HC) 1804

The Delhi High Court recently dealt with the issue of whether a Show Cause Notice (SCN) uploaded only in the ‘Additional Notices Tab’ of the GSTN portal could be treated as valid service under the Central Goods and Services Tax Act, 2017. The case arose from a demand of ₹3.16 crore raised against National Aluminium Company Limited (NALCO) for FY 2018-19, where the assessee contended that the SCN dated 5th December 2023 went unnoticed due to the GST portal update on 16th January 2024, thereby depriving it of the opportunity to respond under Section 73 of the CGST Act.

The Division Bench comprising Justice Prathiba M. Singh and Justice Shail Jain observed that the peculiar circumstances, including the timing of the portal update and issuance of the reminder, justified interference. The Court set aside the impugned order, granted the assessee time till 31st October 2025 to file its reply, and directed the Adjudicating Authority to provide a fresh personal hearing notice through email and mobile before passing a reasoned order. It was clarified that the ruling would not serve as a precedent in other cases and that GST portal access must be provided to the petitioner within a week.

THE PR. COMMISSIONER OF INCOMETAX vs M/S THE HAMLET CITATION : 2025 TAXSCAN (HC) 1805

The Karnataka High Court dealt with the issue of whether the sale consideration of ₹7 crore from the transfer of shares could be treated as unexplained cash credit under Section 68 of the Income Tax Act, 1961. The matter arose from the case of The Hamlet, which had reported a short-term capital loss on the sale of shares in M/s. Kemwell Biopharma Pvt. Ltd. to three purchaser companies. The Assessing Officer (AO) treated the transaction as a sham and added the consideration as unexplained cash credit, a view later upheld by the CIT(A). However, the Income Tax Appellate Tribunal (ITAT) deleted the addition, holding the transactions genuine on the basis of bank statements and financial documents already on record.

The Division Bench of Justice S.G. Pandit and Justice K.V. Aravind upheld the ITAT’s ruling, noting that the purchaser companies had sufficient funds, responded to notices under Section 133(6), and their identity, genuineness, and creditworthiness stood established. The Court emphasised that the Tribunal’s findings were factual, based on evidence, and involved no substantial question of law. Accordingly, the Revenue’s appeal was dismissed, and the ITAT’s order dated 16 November 2023 was affirmed.

RAJ KRISHAN GUPTA AND ORS vsPRINCIPAL DIRECTOR OF INCOME TAX CITATION : 2025 TAXSCAN (HC) 1806

The Delhi High Court examined whether a search and seizure operation on family lockers was lawful under Section 132 of the Income Tax Act, 1961. The petitioners, Raj Krishan Gupta and his family, challenged the 11 May 2024 operation at their lockers in South Delhi Vaults, Greater Kailash-II, New Delhi, contending that the valuables were either disclosed, ancestral, or belonged to their daughters.

The Division Bench of Justice V. Kameswar Rao and Justice Saurabh Banerjee held that the conditions under Section 132 were duly satisfied, that the sufficiency of reasons was beyond judicial review, and that proper authorisations were obtained for each locker. The Court relied on material indicating misuse of benami lockers and the petitioners’ financial profile not matching their possession of multiple high-rent lockers, thereby justifying suspicion of undisclosed wealth. Observing that bona fide reasons to believe were recorded and that bullion fell outside the jewellery limits of CBDT Instruction No. 1916, the Court upheld the searches as lawful and dismissed the writ petition.

NEERAJ BHANUPRATAPSINGH vsADDITIONAL COMMISSIONER OF CUSTOMS (EXPORT) CITATION : 2025 TAXSCAN (HC) 1807

The Delhi High Court dealt with a writ petition concerning penalties and demands in a customs duty drawback fraud case under the Customs Act, 1962. The petitioner, Neeraj Bhanupratap Singh, challenged the Order-in-Original dated 11 July 2025, where the Adjudicating Authority had imposed penalties of over ₹1.34 crore for allegedly controlling 56 entities with forged Import Export Codes (IECs) to export overvalued goods and fraudulently claim duty drawback and IGST refunds.

The Division Bench of Justice Prathiba M. Singh and Justice Shail Jain held that since the Show Cause Notice dated 8 March 2024 was issued after the 2017 amendment, the term “beneficial owner” was rightly applicable. Allowing the petition partly, the Court permitted the appellant to approach the Commissioner (Appeals) by 15 October 2025, directing that the appeal be heard on merits and not dismissed as time-barred. It further clarified that the ₹2 crore already deposited during the investigation would be adjusted toward the mandatory pre-deposit. The writ petition was accordingly disposed of, keeping all rights and remedies open.

Tvl.FABRO GAARDEN vs The StateTax Officer CITATION : 2025 TAXSCAN (HC) 1808

The Madras High Court examined a dispute under the Goods and Services Tax (GST) regime concerning the rejection of an appeal as time-barred in a case relating to the interception of a vehicle for non-possession of an e-invoice. The petitioner, Fabro Gaarden, had its vehicle intercepted on 4 December 2023 and paid a penalty of ₹5,15,412 under protest. When an adverse order was later passed on 13 October 2024, the petitioner filed a manual appeal on 4 January 2025 within the prescribed limitation period, since the web copy of the order was not available. Later, after obtaining the web copy, an e-appeal was also filed on 21 July 2025, which was rejected as time-barred by the Appellate Authority.

The Bench of Justice G.R. Swaminathan held that once the assessee had filed a manual appeal in time, the rejection of the e-filed appeal on limitation grounds was unsustainable. The Court relied on the Allahabad High Court ruling in Kumar Cargo Solution v. State of U.P. (2024) and clarified that the taxpayer could not be penalised for procedural lapses beyond their control. Accordingly, the rejection order was set aside, and the matter remitted back to the Appellate Authority with directions to number the appeal and decide it on merits. The Court also permitted the petitioner to produce the e-invoice, which had been available at the time but not carried by the driver, and directed the appellate authority to dispose of the matter within three months.

MR. IMRAN vsCOMMISSIONEROFCUSTOMS CITATION : 2025 TAXSCAN (HC) 1809

The High Court of Delhi dealt with a dispute under the Customs Act, 1962, concerning the premature disposal of a seized 338-gram gold piece before the passing of the Order-in-Original (OIO). The petitioner, Imran, had arrived from Kuwait at IGI Airport in March 2024 when Customs detained the gold. Despite his representative’s request not to dispose of the item and willingness to re-export, Customs disposed of the gold in June 2024 before passing the OIO on 30 December 2024. The OIO had ordered confiscation under Section 111, imposed a penalty under Sections 112 and 114AA, and allowed redemption on payment of ₹2 lakh, without disclosing that the gold had already been sold.

The Division Bench of Justice Prathiba M Singh and Justice Shail Jain directed Customs to refund the petitioner the balance of the sale proceeds, amounting to ₹19,22,917, after deducting redemption fine and penalty. The Court also ordered payment of 6% interest from 28 June 2024, totaling ₹1,67,045, within one month. While leaving it open to the Department to proceed on the allegation of forgery, the Court directed the Customs Commissioner to establish accessible counters outside the secured airport area for passengers in similar situations. The writ petition was disposed of accordingly.

M/S Safecon Lifescience PrivateLimited vs Additional Commissioner Grade 2And Another CITATION : 2025 TAXSCAN (HC) 1810

In a recent judgment, the Allahabad High Court dealt with the issue of denial of Input Tax Credit (ITC) under Section 74 of the Uttar Pradesh Goods and Services Tax (UPGST) Act, 2017. The case arose from a challenge by Safecon Lifescience Pvt. Ltd., a trader and manufacturer of medicines, against the orders of the Deputy Commissioner (12 January 2022) and the Additional Commissioner (20 December 2022), whereby ITC was disallowed solely because the petitioner’s supplier’s suppliers had defaulted in depositing tax.

The Bench of Justice Piyush Agrawal held that ITC could not be denied on genuine transactions duly supported by invoices, e-way bills, transport records, banking transactions, and GST returns. The Court emphasized that Section 74 applies only in cases involving fraud, wilful misstatement, or suppression of facts, none of which were present here. Consequently, both impugned orders were quashed and the writ petition was allowed.

PUNEET BATRA vs UNION OF INDIA& ORS CITATION : 2025 TAXSCAN (HC) 1811

The Delhi High Court examined the legality of the GST Department’s seizure of electronic devices from a lawyer’s office, raising the issue of whether such searches could compromise attorney–client privilege and third-party client confidentiality. The writ petition was filed by Puneet Batra, an advocate, after GST officials conducted a search at his office and seized a CPU containing sensitive client data. The case involved interpretation of the GST law’s search and seizure powers vis-à-vis the protections afforded to lawyers and their clients under general law.

The Division Bench of Justice Prathiba M. Singh and Justice Shail Jain permitted the GST Department to inspect the seized CPU but only under strict safeguards. The Court directed that the examination be carried out in the presence of the petitioner, nominated lawyers or a forensic expert, senior IT officials of the High Court, and a forensic expert of the Department. A clone of the hard drive was to be created, a copy provided to the petitioner, and only relevant files pertaining to the investigation shared with the Department. The CPU was to remain sealed thereafter, and no coercive action could be taken against the petitioner during the inspection.

Indrapadi Devi Wife of Ajay Sawvs The Union Of India and Ors CITATION : 2025 TAXSCAN (HC) 1812

The Patna High Court dealt with the legal issue of land acquisition compensation under the National Highways Act and the alleged wrongful deduction of income tax from such compensation. The writ petition, filed under Article 226 of the Constitution by Indrapadi Devi, concerned land situated at Mauza Baidarabad, Arwal district, acquired for widening of NH-28. The petitioner sought reclassification of the acquired land as commercial instead of agricultural, recalculation of compensation at four times the market value with solatium and 18% compound interest, and refund of income tax deducted from the award.

The Bench of Justice Rajiv Roy recorded the State’s submission, through counsel Dhurjati Pd, that the petitioner could raise her grievance before the Divisional Commissioner, Magadh Division, Gaya. The petitioner’s counsel, Ambuj Nayan Chaubey and Bhairaw Nand Sharma, agreed to approach the authority. Disposing of the writ, the Court directed that if a statutory petition is filed within four weeks, the Commissioner must adjudicate the matter expeditiously. The Court did not decide the merits of land classification or tax refund but left those issues open for administrative determination.

ID FRESH FOOD(INDIA) PRIVATELIMITED vs ASSISTANT COMMISSIONER CITATION : 2025 TAXSCAN (HC) 1813

The Andhra Pradesh High Court quashed two GST assessment orders issued by the State authorities against ID Fresh Food (India) Pvt. Ltd., holding that parallel assessments for the same taxable period were impermissible. The company was already facing proceedings initiated by the DGGI, Chennai Zonal Unit, concerning alleged misclassification of parottas and tax liability for the period July 2017 to December 2021, which culminated in an order upheld in appeal and presently pending before the Madras High Court. Despite this, the Assistant Commissioner (ST), Andhra Pradesh, passed separate assessment orders for FY 2019–20 and FY 2020–21 on 27.08.2024 and 25.02.2025.

The Division Bench of Justice R. Raghunandan Rao and Justice Challa Gunaranjan accepted the petitioner’s contention that the state-level proceedings amounted to double taxation for the same period already adjudicated by central authorities. Observing that such duplication was unsustainable in law, the Court set aside both impugned assessment orders but clarified that the State respondents were free to pursue their claims before the Madras High Court, where the matter is pending.

Prince Khunteta vs AdditionalCommissioner, Enforcement Win CITATION : 2025 TAXSCAN (HC) 1814

The Rajasthan High Court held that the Income Tax Department cannot retain amounts collected during a search in the absence of a valid demand order. The case arose from a petition filed by Prince Khunteta, proprietor of Mateshwari Mobiles, Jaipur, after the Department collected Rs. 24,06,375 during a search operation without issuing any formal demand. The petitioner sought a refund with interest, arguing that retention of the amount was illegal and coercive.

The Division Bench of Chief Justice K.R. Shriram and Justice Maneesh Sharma observed that the Department had failed to produce any demand order despite repeated opportunities. The Court ruled that money collected without lawful authority could not be retained, directed the refund of Rs. 24,06,375 with 12% interest per annum by 30 September 2025, and imposed Rs. 25,000 as costs, allowing personal recovery from the responsible officer. The writ petition was accordingly disposed of.

RAMESWAR UDYOG PVT. LTD. vsUNION OF INDIA CITATION : 2025 TAXSCAN (HC) 1815

The Gujarat High Court directed the customs authorities to re-verify export records and process a pending IGST refund after finding that a technical mismatch between the GST portal and the ICEGATE system had prevented an exporter from amending certain export invoices. The matter arose from a Special Civil Application filed by Rameswar Udyog Pvt. Ltd., which sought an IGST refund of ₹38,84,875 along with interest for exports made in July 2017.

The Bench comprising Justice J.B. Pardiwala and Justice Ilesh J. Vora accepted the remedial protocol outlined in CBIC Circular No. 12/2018-Customs and directed the Deputy Commissioner of Customs to act accordingly, ensuring the refund is sanctioned within 12 weeks of the order. The Court clarified that if any difficulties arise, the authorities must seek information from the petitioner, and in case of persistent issues, the petitioner may revive the writ petition.

Star Light House & Anr. vsThe Commissioner West Bengal Goods andServices Tax & Ors CITATION : 2025 TAXSCAN (HC) 1816

The High Court of Calcutta set aside the rejection of a GST appeal and remanded the matter to the appellate authority after condoning a 56-day delay, which arose due to a partner’s serious family illness. The matter involved Star Light House & Anr., who had filed the appeal under Section 107 of the WBGST/CGST Act, 2017 against an order passed under Section 73 for the tax period 2019-20. The petitioners explained that the delay occurred because the partner responsible for tax matters was occupied with the treatment of his terminally ill mother.

The Bench of Justice Raja Basu Chowdhury held that the appellate authority had rejected the appeal mechanically without considering the genuine explanation. The Court condoned the delay, quashed the attachment order under Form GST DRC-13 linked to the demand in Form GST DRC-07, and remanded the matter for disposal on merits within twelve weeks, noting that the pre-deposit of Rs. 1,26,832 had already been made.

SLV CONSTRUCTIONS vs ASSISTANTCOMMISSIONER OF STATE TAX CITATION : 2025 TAXSCAN (HC) 1817

The Andhra Pradesh High Court held that a GST assessment order without the signature of the Assessing Officer is invalid and cannot be considered as duly served under law. The matter involved SLV Constructions, which challenged the assessment order dated 21 December 2023 and the summary order in Form GST DRC-07 dated 23 December 2023 issued under the CGST Act, 2017 for the financial year 2021-22.

The Division Bench comprising Justice R. Raghunandan Rao and Justice Challa Gunaranjan quashed both the assessment and summary orders, noting precedents such as A.V. Bhanoji Row v. Assistant Commissioner and T.V.L. Deepa Traders v. Deputy Commissioner, which emphasize that signature is mandatory. The Court granted the Assistant Commissioner liberty to conduct a fresh assessment after proper notice and signature, and excluded the period from the impugned orders’ issuance to the present judgment for limitation purposes. The writ petition was disposed of with no order as to costs.

Hindusthan Biri Leave vsAssistant Commissioner of State Tax CITATION : 2025 TAXSCAN (HC) 1818

The Calcutta High Court held that a mere 17-hour expiry of an e-way bill cannot justify the imposition of a 200% GST penalty in the absence of evidence showing malafide intent to evade tax. The matter involved Hindusthan Biri Leaves & Anr., who challenged the order passed under Section 129 of the West Bengal GST Act, 2017, read with the CGST and IGST Acts, relating to the transportation of 329 bags of kendu leaves from Chhattisgarh to West Bengal. The e-way bill had expired on 27 July 2022, while the vehicle was intercepted on 29 July 2022, leading to the penalty imposed by the department.

The Division Bench comprising Chief Justice T.S. Sivagnanam and Justice Chaitali Chatterjee observed that there was no allegation of tax evasion or other discrepancy, and the delay was caused by traffic, not malafide intent. Citing precedents such as Progressive Metals Pvt. Ltd. v. Deputy Commissioner and Assistant Commissioner (ST) v. Satyam Shivam Papers (P.) Ltd., the court held that the penalty was mechanical and unsustainable. The orders of the original and appellate authorities were quashed, and the authorities were directed to refund the penalty recovered within eight weeks, with the writ petition and appeal allowed and no order as to costs.

Nikita Agarwal vs AssistantCommissioner of Revenue Commercial Taxes andState Tax CITATION : 2025 TAXSCAN (HC) 1819

The Calcutta High Court held that retrospective cancellation of a GST registration cannot be sustained when based on a vague and defective show cause notice, and directed the restoration of the registration. The matter involved Nikita Agarwal, who challenged the cancellation of her GST registration with retrospective effect from 9 May 2019. The Assistant Commissioner had issued a show cause notice alleging fraud, wilful misstatement, or suppression of facts, but the notice did not clearly specify the allegation, and the appellant’s request for adjournment was not considered.

The Division Bench comprising Chief Justice T.S. Sivagnanam and Justice Chaitali Chatterjee (Das) observed that the show cause notice denied the appellant a fair opportunity to defend herself. Relying on precedents such as Oryx Fisheries Pvt. Ltd. v. Union of India and Ramesh Chander v. Assistant Commissioner of GST, the court held that retrospective cancellation requires objective justification, which was absent in this case. Consequently, both the cancellation and appellate orders were set aside, the GST registration was restored retrospectively, and the authorities were directed to consider the appellant’s application for an additional place of business in accordance with law.

M/s Rayban Sun Optics India Pvt.Ltd vs The Commissioner Of Central Excise CITATION : 2025 TAXSCAN (HC) 1820

The Rajasthan High Court quashed the rejection of Rayban Sun Optics India Pvt. Ltd.’s CENVAT refund claim of ₹16.89 lakh and directed the department to pay the amount with 12% interest per annum. The matter arose from a show cause notice issued in May 2004 regarding non-reversal of CENVAT credit on inputs written off for A.Y. 2000-01. Despite the CESTAT ruling in June 2021 holding the refund claim to be within time, the department again rejected the claim in January 2023 on limitation grounds.

The Bench comprising Justice K.R. Shriram and Justice Maneesh Sharma observed that the repeated rejection amounted to harassment and violated the finality of the CESTAT order. The Court held that the refund claim was valid and directed the department to release ₹16,89,669/- along with 12% interest per annum, calculated from 19th February 2018, within six weeks. The writ petition was allowed, and the order dated 4th January 2023 was quashed.

MRS SULOCHANA DEVI LOHIA vs THEUNION OF INDIA CITATION : 2025 TAXSCAN (HC) 1821

The High Court of Gauhati directed the GST authorities to return cash and items seized from Sulochana Devi Lohia during a GST investigation in July 2023. The petitioner sought the return of Rs. 9,00,000, a laptop, and various documents and files. Upon inquiry, the Standing Counsel for GST confirmed that the investigation had concluded and the seized materials were no longer required.

The Bench of Justice N. Unni Krishnan Nair observed the undertaking given by the GST authorities and directed that the petitioner approach the Additional Officer of GST Intelligence, Guwahati Zonal Unit, on 25 September 2025 to collect the seized items. The Court disposed of the writ petition, emphasizing that the respondents must honor their commitment to return the cash and other materials.

M/s. Sunrise Coke EnterprisesPvt. vs Chief Commissioner of CommercialTaxes CITATION : 2025 TAXSCAN (HC) 1822

The Orissa High Court held that a two-day delay in filing a GST appeal by Sunrise Coke Enterprises Pvt. Ltd. should not have led to outright rejection without considering the petitioner’s explanation. The appeal, filed for the 2020–21 period against a demand of Rs. 56,364 under Section 73 of the Odisha GST Act, 2017, was submitted on 24 February 2025, two days past the three-month limitation.

The Division Bench of Chief Justice Harish Tandon and Justice Murahari Sri Raman observed that the petitioner’s claim was genuine and not disputed by the department. The Court set aside the rejection order dated 29 April 2025 and directed the petitioner to appear before the Appellate Authority by 10 October 2025, file a response, and be afforded an opportunity of hearing. The writ petition was disposed of with these directions.

Ashwini Mehra vs State of Odisha CITATION : 2025 TAXSCAN (HC) 1823

The Orissa High Court held that a contractual dispute arising from a pipeline project awarded by GAIL cannot be treated as cheating and granted anticipatory bail to Ashwini Mehra, the liquidator of Punj Lloyd Ltd., and other company officials. The allegations involved non-payment of Rs. 3.28 crore to a subcontractor and wrongful availing of GST credit of Rs. 35.95 lakh, which formed the basis of FIR No. 644 of 2024 at Kamakhya Nagar P.S. The Court noted that insolvency proceedings against Punj Lloyd Ltd. were already pending before the NCLT and that the dispute was essentially civil and contractual in nature.

The Bench of Justice V. Narasingh observed that the investigating agency had ignored the statutory protections under the Insolvency and Bankruptcy Code, 2016. Referring to Supreme Court precedents, the Court held that anticipatory bail can be granted when civil disputes are framed as criminal cases. The petitioners were directed to be released on anticipatory bail, subject to conditions, with the clarification that this order was limited to the bail application and did not comment on the merits of the allegations, which would be examined independently during investigation.

M/S NCS PEARSON INC vs UNION OFINDIA CITATION : 2025 TAXSCAN (HC) 1824

The Karnataka High Court quashed a show-cause notice (SCN) issued under Section 74 of the GST Act, 2017 against NCS Pearson Inc., holding that there was no wilful suppression or intention to evade tax. The SCN, issued by the DGGI, alleged non-payment of GST on GMAT Type-III tests for 2017–2021, despite the classification issue being sub judice before the High Court in W.P. No. 3555/2021. The Court noted that the petitioner had transparently disclosed all relevant transactions before the AAR and AAAR, and that the Revenue’s claim of misreporting or underpayment did not establish deliberate intent to evade tax.

The Bench of Justice S.R. Krishna Kumar emphasized that Section 74 requires proof of fraud, wilful misstatement, or suppression, and cannot be invoked mechanically. The SCN was deemed illegal and arbitrary, as it attempted to bypass ongoing judicial scrutiny while the petitioner enjoyed interim protection. The Court also underscored that tax cannot be collected without clear legal authority, and investigative agencies must respect ongoing proceedings. Accordingly, the SCN was quashed in its entirety.

Idp Education India Pvt. Ltd vsThe Union Of India CITATION : 2025 TAXSCAN (HC) 1825

The Rajasthan High Court held that IDP Education India Pvt. Ltd. qualifies as providing “export of services” to IDP Education Ltd., Australia, rather than acting as an intermediary, and allowed the IGST refund. The petitioner provides counseling, course guidance, and enrollment services to students aspiring to study abroad, but the final admission decisions rest solely with IDP Australia. The Revenue had denied the refund claiming IDP India acted as an intermediary, which would fix the place of supply in India and disqualify it from zero-rated benefits.

The Bench of Chief Justice K.R. Shriram and Justice Maneesh Sharma relied on earlier rulings, noting that intermediary services require three parties, whereas IDP India’s contract involved only two: the petitioner and IDP Australia. The Court also referenced the CBIC September 2021 circular and prior refunds sanctioned elsewhere to reject the Revenue’s contradictory stance. It set aside the orders denying refund and directed the authorities to process IDP India’s IGST refund with applicable interest within four weeks.

M/S Parvinder Singh vs The Stateof Bihar CITATION : 2025 TAXSCAN (HC) 1826

The Patna High Court recently addressed a matter concerning the validity of proceedings initiated under Section 74 of the Goods and Services Tax (GST) Act, 2017, involving a contractor, Parvinder Singh, who had been issued a show-cause notice (SCN) despite having filed his GST returns and paid taxes. The petitioner challenged the assessment order dated 15.01.2021, the appellate order dated 25.03.2025, and the consequent demand raised via DRC-07, asserting that the SCN was issued without proper verification of returns and payments already made, and that the notice had been improperly served only via the “Additional Notices” tab on the GST portal, without email or SMS notification.

The Bench comprising Mr. Justice Rajeev Ranjan Prasad and Mr. Justice Sourendra Pandey held that the proceedings under Section 74 were not justified, noting that the petitioner had filed the relevant returns on 07.12.2020, prior to the issuance of the SCN, and the State’s own counter-affidavit admitted that the proceedings were triggered solely due to non-communication in the prescribed form. Accordingly, the Court set aside the assessment order dated 15.01.2021, the appellate order dated 25.03.2025, and the consequential demand, granting relief to the petitioner against coercive recovery measures.

M/S Anand And Anand vs PrincipalCommissioner Central Goods And Services CITATION : 2025 TAXSCAN (HC) 1827

The Allahabad High Court recently addressed the legal issue concerning the powers of the GST Appellate Authority under Section 107(11) of the Central Goods and Services Tax Act, 2017. The Court clarified that the Appellate Authority is empowered only to confirm, modify, or annul the order under appeal and cannot remit cases back to the Adjudicating Authority. This arose from a writ petition filed by M/s Anand and Anand, challenging an order of the Joint Commissioner (Appeals), CGST, Noida, which had remitted multiple appeals for fresh consideration on the ground of insufficient evidence regarding the place of supply of services.

The Bench of Justice Saurabh Shyam Shamshery, held that the part of the impugned order dated 27.09.2023, which remanded the appeals, was ultra vires the statute and set it aside. The Court directed that the appeals be adjudicated afresh by the Appellate Authority itself, in accordance with law, without remanding to the adjudicating authority. It further noted that, since the GST Appellate Tribunal is not yet functional, writ petitions in such matters are being entertained directly, ensuring compliance with the legislative intent and protecting the statutory rights of taxpayers.

Sharmeen Abdul Majid Ansari vsState of Punjab CITATION : 2025 TAXSCAN (HC) 1828

The Punjab and Haryana High Court at Chandigarh has refused anticipatory bail to Sharmeen Abdul Majid Ansari, the HR Manager of Market Seller, in connection with a ₹50 crore investment fraud allegedly orchestrated by the company and its affiliates. The FIR, registered in April 2023 at Ranjit Avenue Police Station, Amritsar, alleged that Ansari and co-accused lured investors with promises of high returns through bulk purchasing and online sales, before the company abruptly shut down operations and its promoters absconded.

The Bench of Justice Batra observed that the allegations were serious, involved substantial public loss, and anticipatory bail is an extraordinary remedy to be granted only in exceptional circumstances. Given that proceedings were already underway to declare her a proclaimed offender and no exceptional grounds were made out, the Court dismissed the plea, emphasizing that the decision concerned only anticipatory bail and would not prejudice the merits of the ongoing trial.

Opasil Pigments And Chemicals(P) Ltd vs State Of U.P. CITATION : 2025 TAXSCAN (HC) 1829

The Allahabad High Court recently dealt with the legal issue of whether an appellate order under the GST Act, 2017 can be recalled under Section 161 merely due to the filing of a Special Leave Petition (SLP) before the Supreme Court. The petitioners, Opasil Pigments And Chemicals (P) Ltd. and M/s Shyam Enterprises, challenged rectification orders that sought to recall earlier appellate orders which had quashed penalties imposed under Section 129(3) of the GST Act.

The Bench of Justice Piyush Agrawal held that the pendency of a Supreme Court SLP does not, by itself, authorize the recall of an appellate order, especially when no interim stay has been granted. The Court clarified that rectification under Section 161 is limited to patent, clerical, or arithmetic errors and does not permit re-appreciation of facts or substitution of findings. The High Court set aside the rectification/recall orders dated 4.8.2020, restored the original appellate orders allowing the appeals, and allowed both writ petitions, emphasizing that using Section 161 to undo a merits-based order amounts to an impermissible review.

Archana Bazaz vs The SeniorJoint Commissioner of Revenue, State Tax &ors CITATION : 2025 TAXSCAN (HC) 1830

The Calcutta High Court recently addressed the legal issue concerning the handling and disposal of goods belonging to a defunct company stored in a leased godown, in light of ongoing GST search and seizure operations. The case involved respondent No. 6, whose leave and licence agreement with the godown owner, Archana Bazaz, had expired on 31 March 2025. The petitioner sought directions for removal of the goods, citing that the lease had ended and she could no longer allow use of the premises or demand fees.

The Bench of Justice Raja Basu Chowdhury observed that respondent No. 6 had no objection to the GST authorities taking possession of the goods and noted that any continued non-cooperation would allow the authorities to clear the godown under the law at the risk and cost of respondent No. 6. The Court directed that if rented storage space was required for the goods, the cost would also be borne by the company. Additionally, notices regarding the case could be validly served on the advocate-on-record for respondent No. 6 for six months. The Bench disposed of the writ petition, allowing the GST authorities to manage and dispose of the goods while restoring the godown to the owner, without imposing costs.

Mohammed Khan vs The State ofTelangana CITATION : 2025 TAXSCAN (HC) 1831

The Telangana High Court recently dealt with a pre-arrest bail application in a case involving alleged fraudulent generation of e-way bills during goods transportation. The legal issue concerned the application of anticipatory bail under Sections 318(4), 336, 338, and 61(2) of the Bharatiya Nagarik Suraksha Sanhita, 2023 (BNS Act) for a driver of a vehicle used in the alleged fraudulent transactions. The petitioner vehicle, lying immobilised at Falaknuma, Hyderabad, was used by the accused to generate fictitious e-way bills, leading to the FIR. The matter raised questions of culpability and preventive custody, given that other accused in the case had already secured anticipatory bail after payment of fines.

The Bench of Justice K. Sujana, who granted anticipatory bail to the petitioner-driver while emphasizing conditional compliance. The petitioner was directed to surrender before the Station House Officer within two weeks, execute a personal bond of ₹25,000 with two sureties of like amount, cooperate with the investigating officer, and appear every Monday until the filing of the charge sheet. The Court’s order balanced the preventive aspect of custodial investigation with the petitioner’s right to liberty, noting the limited role of the driver in the alleged fraudulent e-way bill generation.

M/S. FLIPKART INDIA PRIVATELIMITED COMPANY vs THE ASSISTANT COMMISSIONEROF COMMERCIAL TAXES CITATION : 2025 TAXSCAN (HC) 1832

The Karnataka High Court recently addressed the entitlement of Flipkart India Private Limited to a refund of pre-deposit amounts made under the Karnataka Value Added Tax (KVAT) Act and KGST Act, including payments made through Input Tax Credit (ITC). The legal issue concerned whether the ITC component of a pre-deposit made before 2020 could be refunded in cash under Sections 142(7)(b) and 142(8)(b) of the Karnataka Goods and Services Tax Act, following appellate orders in Flipkart’s favour.

The Bench of Justice S.R. Krishna Kumar, who held that Flipkart was entitled to a cash refund of Rs. 16.11 crore, representing the ITC portion of the pre-deposit, along with interest on the total pre-deposit of Rs. 23.01 crore from the date of deposit until the date of refund. The Court observed that the department had accepted the ITC-based pre-deposit without objection at the time of appeal and that the relevant provisions of the KGST Act mandated cash refund once the liability was set aside, irrespective of whether the payment was made through cash or ITC. The Court directed the respondents to refund the amount and interest in cash within six weeks, and allowed the writ petition.

VIJAY NIRMAN CO. PVT. LTD. vsTHE STATE OF ASSAM AND 3 ORS. CITATION : 2025 TAXSCAN (HC) 1833

The Gauhati High Court recently dealt with a dispute involving Central Sales Tax (CST) benefits under the Central Sales Tax Act, 1956, concerning the issuance of ‘C’ Forms for concessional tax rates. The legal issue arose when Indian Oil Corporation Limited (IOCL) raised a differential tax demand against M/s Vijay Nirman Co. Pvt. Ltd., following the denial of concessional CST benefits on six notified commodities under Circular No. 7/2017 dated September 5, 2017, issued by the Assam tax authority. T

The Bench of Justice Kardak Ete, who observed that the impugned 2017 circular had already been invalidated in Star Cement Meghalaya v. State of Assam & Ors. (2018), and a replacement circular, No. 12/2018-GST dated August 9, 2018, was now in force, restricting concessional ‘C’ Forms to specified uses such as telecommunications, mining, and electricity generation or distribution. The Court held that no further adjudication was necessary regarding the differential demand and accordingly set aside the tax demand raised by IOCL, while permitting the respondents to take action under the new circular if required.

M/S EROS RESORTS & HOTEL LTDvs MUNICIPAL CORPORATION OF DELHI CITATION : 2025 TAXSCAN (HC) 1834

The Delhi High Court recently addressed the validity of higher property tax levied on luxury hotels under the Delhi Municipal Corporation Act, 1957, specifically concerning the Municipal Valuation Committee’s (MVC) recommendations under Sections 116A–116C. The legal issue involved challenges to the classification of hotels based on star ratings and the consequent imposition of increased property tax from 10% to 20%, along with a higher “user factor” (UF-10) for 3-star and above hotels.

The Bench of Justice Purushaindra Kumar Kaurav upheld the MCD’s classification and taxation framework, observing that star ratings provide an objective basis for differentiating luxury hotels from ordinary establishments. The Court held that the imposition of a higher tax on 3-star and above hotels was neither arbitrary nor violative of Article 14 of the Constitution, noting that hotels voluntarily opting for star accreditation cannot repudiate the fiscal consequences. The High Court confirmed that the MVC recommendations were adopted in accordance with statutory procedures, and accordingly dismissed the petitions, validating the uniform levy and retrospective application of higher property tax on premium hotels.

M/s. Tirumala Electronics(closed) vs The Assistant Commissioner ST FACand Others CITATION : 2025 TAXSCAN (HC) 1835

The Andhra Pradesh High Court recently addressed the validity of GST assessment and penalty orders under the Goods and Services Tax Act, 2017, specifically concerning unsigned orders lacking a Document Identification Number (DIN) and officer’s signature. The legal issue revolved around whether such defective orders could be considered valid service and whether the petitioner’s delay in approaching the Court would affect their challenge.

A Division Bench comprising Justice R. Raghunandan Rao and Justice T.C.D. Sekhar held that GST orders without the signature of the assessing officer are invalid and amount to no service in law, citing precedents including A.V. Bhanoji Row v. Assistant Commissioner (ST) and related rulings. The Court observed that provisions under Sections 160 and 169 of the CGST Act, 2017, cannot cure this defect, and Rule 26(3) of the CGST Rules, 2017, clearly mandates that unsigned notices or orders do not constitute valid service. Accordingly, the Court quashed the impugned assessment and penalty orders for FYs 2018-19, 2019-20, and 2020-21, while allowing the GST department to issue fresh proceedings with proper signature and due notice, and excluded the period of original orders from limitation calculations.

Molbio Diagnostics Limited vsAssistant Commissioner of Income Tax CITATION : 2025 TAXSCAN (HC) 1836

The Bombay High Court considered whether sufficient cause existed to condone a delay in filing an appeal under Section 35-G(2)(a) of the Central Excise Act, 1944. The issue arose when Sanvijay Rolling and Engineering Ltd. filed an appeal before the High Court while a rectification application under Section 35-C(2) was pending before the appellate tribunal, claiming that the appeal should be counted from the date of the rectification order. The Court examined whether such simultaneous proceedings could justify exclusion of time under Section 14 of the Limitation Act.

The Division Bench of Justice Anil L. Pansare and Justice Siddheshwar S. Thombre observed that the applicant could not pursue two contradictory positions simultaneously—seeking rectification on the one hand and asserting a substantial question of law for appeal on the other. The Court held that the appeal filed during pendency of rectification was premature, as limitation would start only from the rectification order. The applications were rejected, and the applicant was directed to pay costs of ₹5,000/- per application, emphasizing that judicial time had been unnecessarily consumed.

CHANDRA PRAKASH JAIN vsINSOLVENCY AND BANKRUPTCY BOARD OF INDIA (IBBI) CITATION : 2025 TAXSCAN (HC) 1837

The Gujarat High Court last week stayed an order issued by Insolvency and Bankruptcy Board of India (IBBI) which had suspended the registration of an insolvency resolution professional for six months pursuant to disciplinary proceedings under Section 219 of the Insolvency and Bankruptcy Code, 2016. The petitioner, Chandra Prakash Jain, challenged the order dated 20.08.2025 passed by the Disciplinary Committee, contending that the proceedings initiated pursuant to the show-cause notice issued on 27.02.2025 were erroneous and the order was void ab initio.

The Bench of Justice Mauna M. Bhatt observed that the disciplinary proceedings were therefore invalid, as the same officer had acted both as investigator and adjudicator. The Court noted that no appeal is prescribed under the Code, 2016, making a writ petition under Article 226 of the Constitution of India the appropriate remedy, relying on precedents including Special Civil Applications Nos. 13767/2022, 24566/2022, and 7789/2024. Considering the submissions, the High Court issued notice returnable on 03.11.2025 and stayed the suspension order until the next date of hearing, thereby granting temporary relief to the petitioner.

R S ALLOYS vs INCOME TAX OFFICERWARD 63(1) DELHI & ANR CITATION : 2025 TAXSCAN (HC) 1838

The Delhi High Court examined the reassessment proceedings initiated against R.S. Alloys under Sections 147 and 148 of the Income Tax Act, 1961 for the assessment year 2019-20. The issue was whether the Assessing Officer (AO) had adequate material to initiate reassessment based on alleged transactions with a shell company, and whether judicial review could test the sufficiency of such material.

The Division Bench of Justice V. Kameswar Rao and Justice Vinod Kumar held that the question of genuineness of transactions was factual and to be examined during reassessment proceedings, not in writ jurisdiction. The Court observed that the AO had received sufficient information to form a belief that income had escaped assessment and that the petitioner had been given an opportunity to respond. Consequently, the writ petition was dismissed, affirming that judicial review cannot challenge the sufficiency of material relied upon by the AO.

Sanvijay Rolling and EngineeringLtd vs Commissioner of CGST CITATION : 2025 TAXSCAN (HC) 1839

The Bombay High Court at Goa recently addressed the issue of condoning delay in filing an appeal under Section 35-G(2)(a) of the Central Excise Act, 1944, emphasizing that the applicant cannot evade limitation rules by filing an appeal while a rectification application under Section 35-C(2) is pending. The case involved Sanvijay Rolling and Engineering Ltd., which filed an appeal 184 days after the expiry of the statutory 180-day period, arguing that the appeal should be counted from the date of the rectification order.

A Division Bench comprising Justice Anil L. Pansare and Justice Siddheshwar S. Thombre observed that the applicant had caused unnecessary consumption of judicial time by filing multiple applications with contradictory arguments and irrelevant citations. The Court emphasized that the period of limitation under Section 35-G should be calculated from the date of the final rectification order, and not from the original tribunal order. Consequently, the applications seeking condonation of delay were rejected, and the applicant was directed to pay costs of Rs. 5,000 for each application, reinforcing the principle that judicial time should not be wasted without valid cause.

Aman Kumar Agrawal vs State OfChhattisgarh CITATION : 2025 TAXSCAN (HC) 1840

The High Court of Chhattisgarh recently granted bail in a case involving alleged fraudulent availing of Input Tax Credit (ITC) exceeding ₹40 crore under the Central Goods and Services Tax (CGST) Act, 2017, specifically under Sections 69 and 132(1)(b) and (c). The legal issue revolved around whether the applicant, Aman Kumar Agrawal, could be denied bail despite allegations of claiming ITC through non-existent businesses, given that the investigation was complete, no actual tax loss had been quantified, and the offences were compoundable in nature.

The Bench of Justice Ramesh Sinha heard the matter and, after reviewing the case diary, held that the applicant was entitled to bail. The Court noted that the trial was likely to take time, the applicant had been in custody since 10.06.2025, and there was no risk of absconding. Accordingly, the Court allowed the bail application on furnishing a personal bond of ₹1,00,000 with one solvent surety, effective until the conclusion of Crime No. Arr. 01/2025.

M/s Sunil Kumar Agrawal vs StateOf Chhattisgarh CITATION : 2025 TAXSCAN (HC) 1841

The Chhattisgarh High Court addressed the legal issue of whether a Single Judge Bench can dismiss writ petitions under the Chhattisgarh Value Added Tax Act, 2005 and the Central Sales Tax Act, 1956 on the ground of availability of an alternative remedy, once a Division Bench has already directed adjudication on merits. The case arose from the deletion of the words “High Speed Diesel for Mining Machinery” from the registration certificate of M/s Sunil Kumar Agrawal, which led to writ petitions challenging the deletion and questioning the maintainability of the Single Judge’s dismissal of the petitions citing alternative remedy.

The Division Bench comprising Justice Sanjay K. Agrawal and Justice Radhakishan Agrawal held that since the earlier Division Bench had remitted the matter solely for adjudication on merits without entertaining the plea of alternative remedy, the Single Judge could not again dismiss the petitions on that ground. The Court set aside the common order dated 3 April 2025 and remitted the matters back to the Single Judge for determination on merits, based only on the substantive questions of law raised.

WINGTECH MOBILE COMMUNICATIONS(INDIA) PVT. LTD. vs DEPUTY COMMISSIONER ST CITATION : 2025 TAXSCAN (HC) 1842

The High Court of Andhra Pradesh dealt with the legal issue of refund of amounts recovered under the Andhra Pradesh Goods and Services Tax (APGST) Act, 2017, specifically considering the effect of the statutory pre-deposit under Section 107. The petitioner, Wingtech Mobile Communications (India) Pvt. Ltd., challenged the attachment of its bank accounts and recovery of ₹170 crores following an assessment order raising a demand of ₹244.63 crores, contending that the statutory 10% pre-deposit was already deemed paid and authorities could not retain excess funds.

The Division Bench comprising Justice R. Raghunandan Rao and Justice T.C.D. Sekhar directed refund of the recovered ₹170 crores subject to the petitioner’s undertaking to maintain the refunded amounts and sale proceeds in its account, ensuring a minimum balance of ₹221 crores, inclusive of ₹24.4 crores treated as the statutory pre-deposit. The Court held that once the deemed stay under Section 107 came into effect, no further restraints could be imposed, and disposed of the writ petition while closing pending applications.

M/s A.D. Electrosteel Co. Pvt.Ltd. & Anr vs The Union of India &Ors. CITATION : 2025 TAXSCAN (HC) 1843

The Calcutta High Court dealt with the legal issue concerning the expeditious disposal of a pending application before the Income Tax Appellate Tribunal (ITAT) relating to a demand notice issued under Section 156 of the Income Tax Act, 1961. The petitioners, A.D. Electrosteel Co. Pvt. Ltd. & Anr., challenged a demand raised pursuant to an assessment order dated 25th March 2015 for Assessment Year 2012-13, following multiple dismissals of their appeals and restoration applications for non-prosecution before the CIT(A) and the ITAT.

The Bench of Justice Raja Basu Chowdhury directed that the recalling application filed by the petitioners before the ITAT be taken up and disposed of expeditiously without unnecessary adjournments, noting that the next date of hearing was fixed for 19th September 2025. The Court emphasized the need for prompt adjudication given the pending nature of the application and the raised demand, thereby ensuring that the petitioners’ rights were not unduly prejudiced.

The Government of Tamil Nadu vsTvl.Ponni Sugars (Erode) Limited CITATION : 2025 TAXSCAN (HC) 1844

The Madras High Court addressed the legal issue of retrospective withdrawal of a purchase tax subsidy under the State Government Orders. The case involved Ponni Sugars (Erode) Limited, which had been promised a five-year subsidy equivalent to the purchase tax on sugarcane under the 1984 Government Order. The State attempted to curtail this benefit retrospectively via a 1988 letter, prompting the company to challenge the withdrawal before the Tamil Nadu Taxation Special Tribunal, which upheld the company’s entitlement.

The Division Bench comprising Justice Anita Sumanth and Justice C. Kumarappan held that the retrospective withdrawal lacked legal sanction and violated the principles of legitimate expectation and promissory estoppel. Observing that Ponni Sugars had relied on the Government Orders for its operational and financial planning, the Court ruled that the company was entitled to the full five-year subsidy. Consequently, the writ petition filed by the State was dismissed, with no order as to costs.

M/S Safecon Lifescience PrivateLimited vs Additional Commissioner Grade 2 CITATION : 2025 TAXSCAN (HC) 1845

The Allahabad High Court dealt with the validity of orders issued under Section 74 of the GST Act, concerning alleged wrongful Input Tax Credit (ITC) claims. The case involved M/s Safecon Lifescience Pvt. Ltd., a pharmaceutical trader and manufacturer, which had purchased goods from a registered supplier, M/s Unimax Pharma Chem, with all transactions supported by tax invoices, e-way bills, and payments through banking channels. The petitioner challenged the Deputy Commissioner’s proceedings under Section 74, which were upheld by the first appellate authority, on the grounds that both supplier and purchaser had correctly filed GSTR-3B returns and there was no evidence of fraud or wilful misstatement.

The Bench comprising Justice Piyush Agrawal quashed the impugned orders, holding that Section 74 proceedings can only be invoked in cases of fraud, wilful misstatement, or suppression with intent to evade tax. The Court emphasized that the authorities had ignored proof of actual movement of goods, proper tax payment, and GST filings, and had relied mechanically on intelligence inputs without verification, violating natural justice. Recalling precedents and a CBIC Circular dated 13.12.2023, the Court noted that mere clerical errors or mismatches do not justify action under Section 74, and allowed the writ petition, striking down both the Deputy Commissioner’s and Appellate Authority’s orders.

Classic Legends Pvt Ltd vsAssessment Unit & Ors CITATION : 2025 TAXSCAN (HC) 1846

The Bombay High Court addressed the validity of a Draft Assessment Order under Section 144C(1) of the Income Tax Act, 1961, in the context of transfer pricing assessments. The petitioner, Classic Legends Pvt. Ltd., challenged the Draft Assessment Order dated 8th March 2025 and the Final Assessment Order dated 7th April 2025 under Section 143(3) read with Sections 144C and 144B, along with the subsequent Demand Notice under Section 156 and Show Cause Notices under Sections 270A and 271AAC.

The Bench comprising Justices B.P. Colabawalla and Amit S. Jamsandekar held that the petitioner was indeed not an “eligible assessee” under Section 144C(15)(b) since no variation was made by the TPO. Consequently, the Assessing Officer had no competence to issue a Draft Assessment Order or proceed under Section 144C. The Court quashed the Draft Assessment Order, the Final Assessment Order, the Demand Notice, and the Show Cause Notices, setting aside all impugned proceedings in their entirety.

Payment to Consultant Doctors not salary in absence of Fixed Pay, TDS Deductible u/s 194J: Bombay HC

The Commissioner of Income Tax vs Dr. Balabhai Nanavati Hospital CITATION : 2025 TAXSCAN (HC) 1847

The Bombay High Court addressed the tax treatment of payments made to consultant doctors by Dr. Balabhai Nanavati Hospital, a trust running a hospital, under the Income Tax Act, 1961. The legal issue revolved around whether these payments constituted “salary” under Section 192 or fees for professional services under Section 194J, and the corresponding TDS obligations.

The Bench comprising Justices B.P. Colabawalla and Firdosh P. Pooniwalla upheld the findings of the ITAT and CIT(A), noting that the consultant doctors did not receive fixed remuneration, could practice elsewhere, and no real supervisory control was exercised by the hospital. The doctors themselves filed their tax returns under “Income from Business or Profession,” reinforcing that no employer-employee relationship existed. The Court held that payments to these doctors were not “salary,” and TDS was correctly deductible under Section 194J, dismissing the Revenue’s challenge.