Annual Tax & Corporate Law Digest 2025: Complete Supreme Court Cases [Part IV]

COMMISSIONER OF SERVICE TAX II vs SCHINDLER INDIA PVT. LTD. CITATION: 2025 TAXSCAN (SC) 251

The Supreme Court of India is examining whether VAT paid on the goods portion of elevator works contracts should be excluded from the service tax base under Section 67 of the FinanceAct, 1994 and Rule 2A of the 2006 Rules. The Revenue has appealed against the CESTAT Mumbai’s 15 March 2023 order that set aside tax demands on Schindler India Pvt. Ltd., holding only installation and commissioning taxable.

A Bench of Justice B.V. Nagarathna and Justice Satish Chandra Sharma heard the appeals and listed them for 1 September 2025. CESTAT had relied on precedents like Wipro GE Medical Systems and Johnson Lifts to rule that VAT-paid goods value must be excluded, a decision now under Supreme Court scrutiny with wide implications for works contracts.

Current update : The matter is still pending before the apex court. It was listed on 9th March 2026.

M/S. TARACHAND LOGISTIC SOLUTIONS LIMITED VS STATE OF ANDHRA PRADESH&ORS. CITATION: 2025 TAXSCAN (SC) 252

The Supreme Court examined whether vehicles confined within RINL’s central dispatch yard were liable to motor vehicle tax under Section 3 of the Andhra Pradesh Motor Vehicles Taxation Act, 1963. Tarachand Logistic Solutions argued that since their vehicles never used public roads and operated only within a CISF-guarded, non-public area, no tax could be levied.

A Bench of Justice Manoj Misra and Justice Ujjal Bhuyan agreed, holding that liability arises only when vehicles are used in public places accessible to the public. It ruled that Rule 12A of the 1963 Rules cannot widen the Act’s scope, set aside the Division Bench ruling, restored the Single Judge’s order, and allowed the company’s appeal.

AJAY MAINI vs STATE OF HARYANA & ORS. CITATION : 2025 TAXSCAN (SC) 253

The Supreme Court of India recently flagged serious concerns over the delay in uploading a Punjab and Haryana High Court bail order in Ajay Maini v. State of Haryana. The petitioner challenged the anticipatory bail rejection order dated 31 July 2025, pointing out that it had not been uploaded even by 20 August 2025, forcing him to approach the apex court without a copy. Observing the unexplained delay, the Court sought a report from the Registrar General.

A Bench of Justice J.K. Maheshwari and Justice Vijay Bishnoi noted that the order appeared to have been issued only after the Supreme Court’s intervention. It directed seizure of the Secretary’s steno book, a discreet inquiry, and an affidavit from the National Informatics Centre on the date of typing and uploading. Meanwhile, interim protection was granted to Ajay Maini, and notice was issued to the State of Haryana, returnable in four weeks.

VIJAY KRISHNASWAMI vs THE DEPUTY DIRECTOR OF INCOME TAX CITATION: 2025 TAXSCAN (SC) 254

The Supreme Court of India recently quashed prosecution proceedings initiated under Section 276C(1) of the Income Tax Act, 1961, and imposed costs of ₹2,00,000 on the Income Tax Department. The case arose from a 2016 search at the appellant’s residence, where cash of ₹4.93 crore was seized, followed by prosecution based on alleged tax evasion.

A Bench of Justice J.K. Maheshwari and Justice Vijay Bishnoi held that the Department’s action was in blatant violation of its own binding circulars and guidelines. The Court noted that the Settlement Commission had already accepted the appellant’s full disclosure and granted him immunity from penalty, further undermining the basis for prosecution. Consequently, the Court set aside the criminal proceedings and directed the Revenue to compensate the appellant with ₹2,00,000 for the unwarranted litigation.

THE UNION OF INDIA & ORS vs M/S. TIRTH AGRO TECHNOLOGY PVT CITATION: 2025 TAXSCAN (SC) 255

The Supreme Court of India recently dismissed a Special Leave Petition (SLP) filed by the Union of India in Union of India & Ors. v. Tirth Agro Technology Pvt. Ltd. concerning refunds of unutilised Input Tax Credit (ITC) under the inverted duty structure. The case arose under Section 54(3) of the CGST Act, 2017 read with Rule 89(5), where the Gujarat High Court had held that the July 2022 amendment including input services in refund calculations was clarificatory and retrospective, following its earlier decision in Ascent Meditech Ltd. v. Union of India.

A Bench of Justice Rajesh Bindal and Justice R. Mahadevan observed that the Union’s challenge to Ascent Meditech had already been dismissed by the Supreme Court in March 2025, making the present SLP unsustainable. Noting that the petition was filed despite this precedent, the Court dismissed it and imposed costs of ₹10,000 on the Union of India, directing that the amount be deposited with the Advocate-on-Record Association.

COMMISSIONER OF CENTRAL EXCISE AND SERVICE TAX vs ADANI POWERMUNDRALIMITED CITATION: 2025 TAXSCAN (SC) 256

The Supreme Court of India has admitted the Revenue’s appeal against the CESTAT Ahmedabad order directing refund of ₹5.03 crore service tax paid on ocean freight by Adani Power without applying Notification No. 12/2013-ST. The core issue is whether SEZ-specific procedural conditions can restrict refunds where the Gujarat High Court in SAL Steel Limited has already struck down the levy itself as unconstitutional under the Finance Act, 1994.

A Bench of Justice B.V. Nagarathna and Justice Viswanathan are scheduled to hear the matter on 16 September 2025. During preliminary proceedings, Adani Power was granted four weeks to file its counter affidavit, while the Revenue sought time for filing an affidavit of valuation. The Court’s ruling is expected to clarify whether refunds must be routed through SEZ notifications or allowed outright where the levy has been declared ultra vires.

Current update: The matter is still pending before the apex court. The case is likely to be listed on 13th February 2026.

M/S TRIVENI ENGINEERS vs ASSESSING AUTHORITY CITATION: 2025 TAXSCAN (SC) 257

The Supreme Court of India recently dismissed an appeal filed by M/s Triveni Engineers for non-compliance with the mandatory pre-deposit requirement under Section 16(4) of the Odisha Entry Tax Act, 1999. The appellant had challenged an assessment order, but its appeal before the Additional Commissioner (CT & GST) was rejected on 17 January 2025 for failure to deposit 20% of the disputed demand. A subsequent revision and writ petition before the Orissa High Court also failed, with the Division Bench ruling that courts cannot dilute or rewrite statutory provisions mandating such deposits.

A Bench of Justice Pankaj Mithal and Justice Prasanna B. Varale upheld the Orissa High Court’s decision, holding that Triveni Engineers’ attempt to deposit only 10% was contrary to the clear statutory mandate. Finding no illegality in the High Court’s reasoning, the Supreme Court affirmed that the 20% pre-deposit requirement is a binding condition for maintaining appeals and dismissed the appeal accordingly.

COMMISSIONER OF CGST AND CENTRAL EXCISE GANDHINAGAR vs KALPATARUPROJECTSINTERNATIONAL LIMITED CITATION: 2025 TAXSCAN (SC) 258

The Supreme Court has dismissed the Revenue’s appeal challenging a CESTAT ruling that transportation and insurance services cannot be treated as incidental to installation services for service tax. The case arose from a demand of over ₹14.42 crore against Kalpataru Projects for allegedly excluding transport and insurance charges from the taxable value of works contract services. CESTAT, Ahmedabad Bench, in June 2024, quashed the demand after finding that the contracts clearly bifurcated installation charges from transportation and insurance, treating them as distinct and independent services.

A Bench of Justice Manoj Misra and Justice Ujjal Bhuyan rejected the Revenue’s appeal on the ground of a 172-day delay as well as on merits. Affirming the Tribunal’s view, the Court held that under Section 66F of the Finance Act, 1994, bundled service classification applies only where one service is ancillary to another. Since transportation and insurance were completed prior to installation and were independent in scope, they could not be artificially clubbed into a composite service. The appeal was accordingly dismissed.

COMMISSIONER OF CENTRAL TAX vs KALYAN JEWELLERS INDIA PVT. LTD. CITATION: 2025 TAXSCAN (SC) 259

The Supreme Court has dismissed the Revenue’s appeal against Kalyan Jewellers India Pvt. Ltd., upholding the CESTAT ruling that the extended limitation under Section 11A of the Central Excise Act cannot be invoked without proof of misstatement, suppression, or intent to evade duty. The dispute concerned alleged misclassification of silver articles and wrongful exemption claims for the period March 2016–June 2017, with a demand raised through a Show Cause Notice issued in January 2021—well beyond the normal limitation period.

A Bench of Justices Manoj Misra and Ujjal Bhuyan found no error in the Tribunal’s reasoning that Kalyan Jewellers had duly filed returns, maintained audited accounts, and not collected excise duty, thereby ruling out suppression. Relying on settled precedent, the Court affirmed that mere omissions or interpretational issues do not justify invoking extended limitations. While leaving the classification question open, the Bench held the demand time-barred and dismissed the appeal.

ADDITIONAL DIRECTOR GENERAL ADJUDICATION & SURESH KUMAR AND CO.IMPEXPVT. LTD CITATION: 2025 TAXSCAN (SC) 260

The Supreme Court has ruled that electronic records seized from a taxpayer’s devices are admissible in evidence even without a certificate under Section 138C(4) of the Customs Act, 1962, if their contents are admitted in statements recorded under Section 108. The ruling came in appeals against a 2018 CESTAT order that had set aside demands, penalties, and confiscations against Suresh Kumar and Co. Impex Pvt. Ltd. and its Directors on the ground that the electronic evidence lacked the mandatory certificate.

A Bench of Justices J.B. Pardiwala and K.V. Viswanathan held that the respondents had acknowledged and signed the seized records during investigation and admitted their authenticity under Section 108, thereby fulfilling the substance of Section 138C(4). Finding that the Tribunal erred in dismissing the case on a mere technicality, the Court set aside its order and remanded the matter to CESTAT for fresh adjudication on all other issues, while affirming the admissibility of the electronic records.

ASSISTANT COMMISSIONER OF INCOME TAX vs CHANDRIKA DHANSUKHLAL GANDHI CITATION: 2025 TAXSCAN (SC) 261

The Revenue has approached the Supreme Court challenging a Gujarat High Court judgment that quashed a reassessment notice issued under Section 148 of the Income Tax Act, 1961, against Chandrika Dhansukhlal Gandhi. The High Court found that the Assessing Officer had relied solely on external trading data from the National Spot Exchange Limited and brushed aside the taxpayer’s objections without proper examination, contrary to the principles laid down in GKN Driveshafts India Ltd.

A Bench of Justice Manoj Misra and Justice Ujjal Bhuyan issued notice on the Revenue’s Special Leave Petition (Civil) Diary No. 40313/2025, along with its application for condonation of delay, returnable in six weeks. The Court will now examine whether reliance on external investigation data without independent verification can justify reopening assessments under Section 148.

BRUCE LOGISTICS PRIVATE LIMITED vs UNION OF INDIA & ANR CITATION: 2025 TAXSCAN (SC) 262

The Supreme Court has clarified that the Bombay High Court erred in recording that CESTAT had accepted the Commissioner’s finding that Bruce Logistics Pvt. Ltd. advised an importer to mis-declare “Black Firing Guns” as “Metal Toy Guns.” The Court noted that CESTAT had instead treated the matter as one of misclassification, not misdeclaration, and had relied on the principle that a retracted confession cannot alone form the basis of an adverse finding without corroboration.

A Bench of Justice Manoj Misra and Justice Ujjal Bhuyan held that the High Court’s conclusion was contrary to the Tribunal’s actual reasoning, which recognized that Customs officers themselves had classified the goods as toy guns after examination. The Court disposed of the appeal with this clarification and ordered that all pending applications be closed.

ASSISTANT COMMISSIONER OF INCOME TAX/INCOME TAX OFFICER vs CUMMINSINDIALIMITED CITATION: 2025 TAXSCAN (SC) 264

The Supreme Court has dismissed the Revenue’s SLP against the Bombay High Court’s order dated 28 July 2023 in a transfer pricing dispute involving Cummins India Ltd., where the core issue concerned aggregation of royalty for technology with the manufacturing segment for benchmarking under the Income Tax Act, 1961. The HC proceedings arose under Section 260A from ITAT orders for AYs 2015-16 to 2017-18, addressing TNMM aggregation of royalty versus the Revenue’s CUP-based segregation.

A Bench of Justice Sanjay Kumar and Justice Satish Chandra Sharma noted that SLPs against the very same HC order had already been dismissed and, therefore, this petition “must meet the same fate.” The Court accordingly dismissed both the application for condonation of delay and the SLP, leaving the Bombay High Court’s view and the ITAT’s aggregation approach undisturbed.

COMMISSIONER COMMERCIAL TAX U.P vs S/S SANJAY TRADERS CITATION: 2025 TAXSCAN (SC) 265

The Supreme Court has dismissed the Revenue’s appeal against the Allahabad High Court’s order in a dispute under Section 30(1) of the UP Trade Tax Act for AY 2004–05, holding that purchases made on behalf of Ex-UP Principals were not taxable.

A Bench of Justice [names not specified in order] noted that Sanjay Traders, the assessee, had secured consistent findings from the AO, Joint Commissioner (Appeals), and the Tribunal that the transactions were carried out for Ex-UP Principals, duly identifiable, verified, and recorded in prescribed forms. Finding no reason to interfere, the Court upheld the view taken below and dismissed the Revenue’s challenge.

COMMISSIONER, CGST AND CENTRAL EXCISE vs M/S SPICEJET LTD. CITATION: 2025 TAXSCAN (SC) 266

The Supreme Court has dismissed the Revenue’s appeal against SpiceJet Ltd. in a service tax dispute involving excess CENVAT credit and taxability of baggage charges, citing both a 567-day delay without sufficient cause and lack of merit. The Revenue had challenged a CESTAT order setting aside demands of ₹25.56 crores relating to AY 2009-2012.

A Bench of Justice J.B. Pardiwala and Justice R. Mahadevan noted that SpiceJet had recomputed CENVAT credit within the prescribed period, that baggage charges were integrally linked to passenger transport and covered by the capped levy, and that the extended limitation period was inapplicable given prior audits. Finding no reason to interfere, the Court dismissed the appeal and all pending applications.

ADDITIONAL COMMISSIONER GRADE-2 & ANR. vs M/S. DAYAL PRODUCT CITATION : 2025 TAXSCAN (SC) 267

The Supreme Court upheld the Allahabad High Court’s ruling in M/s Dayal Product v. Additional Commissioner Grade-2 & Anr., addressing the legal issue of whether Section130 of the GST Act can be invoked for stock discrepancies detected during a survey. The Court confirmed that mere discrepancies observed through eye estimation without physical verification cannot trigger confiscation proceedings under Section 130, and that any shortfall in tax should be addressed under Sections 73 or 74 of the GST Act.

The bench of Justices Sanjya Kumar and Satish Chandra Sharma dismissed the Special Leave Petition filed by the Additional Commissioner, declining to interfere with the High Court’s judgment. The Court clarified that the dismissal does not prevent the department from pursuing other remedies under the law, reaffirming that confiscation under Section 130 requires more than stock variation detected during a survey.

MRS. SHAILJA KRISHNA vs SATORI GLOBAL LIMITED & ORS. CITATION : 2025 TAXSCAN (SC) 268

The Supreme Court of India held that the National Company Law Tribunal (NCLT) has jurisdiction to examine allegations of fraud relating to a gift deed when such allegations form the core of a dispute involving oppression and mismanagement under the Companies Act, 1956, specifically under Sections 397 and 398. The Court emphasized that NCLT’s powers extend to matters incidental to complaints of oppression and mismanagement, including fraudulent or coercive transfer of shares that violate the company’s Articles of Association.

The bench of Justices Dipankar Datta and K. Vinod Chandran restored the NCLT’s 2018 order in favor of Mrs. Shailja Krishna, holding the gift deed and share transfers invalid, and declaring the board meetings of December 2010 conducted illegally. The Court set aside the NCLAT’s 2023 judgment and directed reinstatement of the appellant as director and shareholder, granting all consequential reliefs while parties were ordered to bear their own costs.

COMMISSIONER OF CENTRAL EXCISE vs M/S LANYARD FOODS LTD CITATION : 2025 TAXSCAN (SC) 269

The Supreme Court of India held that appeals concerning breach of conditions under an exemption notification fall within the jurisdiction of the High Courts under Section 130 of the Customs Act, 1962, and cannot be filed directly before the Supreme Court under Section 130E. The Court emphasized that when disputes are limited to alleged violations of exemption conditions—without involving classification, valuation, or determination of duty rates—Section 130, not Section 130E, governs the maintainability of appeals.

The bench of Justices Manoj Misra and Sandeep Mehta set aside the Karnataka High Court’s earlier order dismissing the Department’s appeals as not maintainable, invoking Article 142 of the Constitution to restore the appeals for adjudication on merits. The Supreme Court clarified that all parties’ contentions remain open before the High Court, and permitted reconstitution of records if previously disposed of or destroyed.

COMMISSIONER OF CENTRAL EXCISE vs M/S. SARAVANA ALLOYS STEEL PVT. LTD CITATION : 2025 TAXSCAN (SC) 270

The Supreme Court of India clarified that appeals concerning clandestine removal of manufactured goods are not maintainable under Section 35-L of the Central Excise Act, 1944. The Court held that disputes relating to clandestine removal or manufacture do not fall within Section 35-L’s ambit, and dismissal of such appeals by the High Court should not leave the appellant without remedy.

The bench of Justices Manoj Misra and Sandeep Mehta invoked their extraordinary powers under Article 142 of the Constitution to set aside the Karnataka High Court’s 2014 order, restoring the matter to its original numbers before the High Court for adjudication on merits. The Supreme Court clarified that all contentions of both parties remain open for consideration, ensuring that the Department and the company can present their cases fully.

COMMISSIONER OF CENTRAL EXCISE BENGALURU SERVICE vs M/S CONFIDENTPROJECTSPVT. LTD CITATION : 2025 TAXSCAN (SC) 271

The Supreme Court of India dismissed the appeal filed by the Department of Central Excise and Service Tax, upholding the CESTAT ruling that Confident Projects Pvt. Ltd. is eligible for the Works Contract (Composition Scheme for payment of Service Tax) Rules, 2007. The Court noted a gross delay of 255 days in filing the appeal and observed that the Department’s challenge to the CESTAT order lacked merit, while keeping the larger question of law open for future consideration.

The bench endorsed the tribunal’s finding that the construction contracts in question were composite works contracts and not liable to be taxed under “Construction of Complex Services.” Relying on precedents like Larsen & Toubro Ltd. vs. State of Karnataka, the Court confirmed that service tax demands for the period October 2007 to June 2012 were unsustainable, dismissing the Department’s appeal and upholding the CESTAT order without any consequential relief.

ALISHAN COMPLEX PRIVATE LIMITED vs ASSISTANT COMMISSIONER OF INCOME TAX CITATION : 2025 TAXSCAN (SC) 272

The Supreme Court of India has listed a petition challenging provisional attachment orders under Section 24 of the Prohibition of Benami Property Transactions (PBPT) Act, 1988. The petitioners, Alishan Complex Pvt. Ltd. and its Director, argued that the attachment was issued before they could respond to the show cause notice, raising natural justice concerns. They also claimed the property was held in a fiduciary capacity under Section 2(9), and thus not a benami property.

A bench of Justice B.V.Nagarathna and Justice R. Mahadevan listed the matter after two weeks. The Court has not yet ruled on the merits but will examine whether the provisional attachment under Sections 24(3) and (4) complied with statutory requirements and principles of natural justice.

Current status: The matter is still pending before the apex court.

DALHOUSIE PUBLIC SCHOOL EDUCATIONAL SOCIETY vs UNION OF INDIA CITATION : 2025 TAXSCAN (SC) 273

The Supreme Court of India has addressed an income tax appeal involving a large refund claim by Dalhousie Public School Educational Society. The legal issue concerned the rejection of the society’s refund by the Assistant Commissioner of Income Tax (Exemptions), Chandigarh, and the statutory remedy available under Section 246-A of the Income Tax Act, 1961, relating to appeals against orders passed by income tax authorities.

A bench comprising Justice J.B. Pardiwala and Justice R. Mahadevan modified the earlier Punjab & Haryana High Court order and directed that the appeal be disposed of within two months instead of the originally mandated one year. The Court emphasized that the appellate authority must pass an appropriate order in accordance with law, noting that further delay could cause undue hardship to the educational institution.

COMMISSIONER OF CUSTOMS vs M/S MAHESHWARI MINING PVT. LTD CITATION : 2025 TAXSCAN (SC) 274

The Supreme Court of India has admitted an appeal filed by the Commissioner of Customs (Port) against the order of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Kolkata, which had quashed a duty demand on Maheshwari Mining Pvt. Ltd relating to the classification of imported underground mining vehicles. The dispute concerns the proper Customs Tariff Headings (CTH) under which specialized underground mining equipment, including personnel carriers and dump trucks, should be classified, with implications under the Customs Act, 1962 for duty liability.

A bench comprising Justice J.B. Pardiwala and Justice K.V. Viswanathan condoned the delay in filing, allowed the exemption application, and admitted the department’s appeal. The apex court will now determine the correct tariff classification of these purpose-built underground mining vehicles, which were previously treated by CESTAT as off-road mining machinery under Chapter 84, quashing the department’s demand of ₹3.60 crore in differential duty. The next hearing date is yet to be scheduled.

Current status: The matter is still pending before the apex court.

ASSISTANT COMMISSIONER OF INCOME TAX vs VODAFONE ESSAR GUJARAT LIMITED CITATION: 2025 TAXSCAN (SC) 275

The Supreme Court of India deferred the disposal of a dispute between the Income Tax Department and Vodafone Essar Gujarat Ltd. over a claim of ₹191.59 crore under Section 80IA of the Income Tax Act, 1961. The issue involves whether deductions can be claimed despite shareholding changes under Section 79, with the Gujarat High Court holding that Section 80IA(5) cannot ignore lapsed losses.

The matter was listed before Justice Dipankar Datta and Justice Augustine George Masih, who granted the Revenue two weeks to file a rejoinder and re-listed the petition after three weeks. The Supreme Court is examining the correctness of ITAT and lower authorities’ disallowance of Vodafone’s claim in light of the High Court’s judgment.

COMMISSIONER OF CUSTOMS (PORT) vs M/S. TWINKLE TRADECOM PRIVATE LIMITED CITATION : 2025 TAXSCAN (SC) 276

The Supreme Court of India dismissed the appeal filed by the Department against M/s Twinkle Tradecom (P) Ltd., arising from the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), East Zonal Bench, Kolkata, regarding the classification of imported goods as “Electric Tricycle Spare Parts” under CTH 8708.99.00. The Department alleged that the consignments were e-rickshaws in CKD condition and sought confiscation under Sections 111(m), 112(a)(ii), and 125 of the Customs Act, 1962.

A two-judge bench of Justice Pankaj Mithal and Justice Prasanna B. Varale upheld the CESTAT order, noting that the imported goods were correctly classified as spare parts and not complete vehicles. The Tribunal’s ruling set aside the re-assessed duty, confiscation, redemption fine, and penalties imposed by the lower authorities, dismissing the Department’s appeal on grounds of delay and lack of merit.

AMIT NEHRA vs PAWAN KUMAR GARG CITATION : 2025 TAXSCAN (SC) 277

The Supreme Court of India dealt with the legal issue of homebuyers’ claims under the Insolvency and Bankruptcy Code, 2016 (IBC), Section 62, concerning possession of apartments in a real estate project during a Corporate Insolvency Resolution Process (CIRP). The dispute arose from M/s Puma Realtors Private Limited’s failure to deliver possession to bona fide homebuyers, Amit Nehra & Anr, despite their claim being verified, admitted, and included in the list of financial creditors.

A two-judge bench of Justices Sanjay Kumar and Satish Chandra Sharma set aside the orders of the NCLT and NCLAT, observing that once a claim is verified and admitted by the Resolution Professional, it acquires full legal recognition. The Court directed the respondents to execute the conveyance deed and hand over possession of the allotted apartment to the appellants within two months, highlighting the hardship caused to individual homebuyers who had paid nearly the entire sale consideration years in advance.

MANSI BRAR FERNANDES vs SHUBHASHARMA AND ANR. CITATION : 2025 TAXSCAN (SC) 278

The Supreme Court of India examined the misuse of Section 7 of the Insolvency and Bankruptcy Code, 2016 by speculative investors in real estate projects. The appellants, including Mansi Brar Fernandes, had filed insolvency proceedings against Gayatri Infra Planner Pvt. Ltd. before the NCLT, claiming rights as homebuyers under buy-back agreements. While the NCLT admitted the applications, the NCLAT reversed them, holding the appellants to be speculative investors rather than genuine financial creditors, prompting the present appeals before the Supreme Court.

The Bench of Justice J.B. Pardiwala and Justice R. Mahadevan upheld the NCLAT’s findings, affirming that speculative investors cannot invoke Section 7 IBC. The Court emphasized that the IBC is a revival mechanism for distressed companies, not a profit-making tool, and directed the IBBI to frame project-specific insolvency guidelines. It also advised the Union Government to expand revival funds like SWAMIH to protect genuine homebuyers, reiterating that the right to housing forms part of Article 21 of the Constitution

DIGITECH ELECTRONICS SYSTEMSPVT. LTD vs UNION OF INDIA CITATION : 2025 TAXSCAN (SC) 279

The Supreme Court of India recently upheld a Bombay High Court ruling that dismissed a challenge to an Income Tax attachment under the Income Tax Act, 1961, dating back to 2012. The case arose from a special leave petition filed by Digitech Electronics Systems Pvt. Ltd., which had purchased the disputed shop in 2021 and claimed the right to object under Rule 11 of Schedule II and Rule 68B. The High Court, however, held that mere possession without clear title could not defeat a pre-existing attachment.

The Bench of Justice Pankaj Mithal and Justice Prasanna B. Varale affirmed the High Court’s view, noting that Digitech was neither in possession nor a party when the 2012 attachment was made, and its title remained under dispute in pending civil suits. The Court held that such objections could not be entertained and dismissed the special leave petition, leaving questions of ownership and title to be adjudicated in the ongoing civil proceedings.

DEPUTY COMMISSIONER OF STATE TAX& ANR. vs HOTEL SAYOOJ CITATION : 2025 TAXSCAN (SC) 280

The Supreme Court of India upheld a Kerala High Court ruling in favour of Hotel Sayooj, holding that the tax department could not assess it under the compounded provisions of Section 7 of the Kerala General Sales Tax Act when the hotel had in fact paid tax under the regular provisions of Section 5. The dispute arose from a special leave petition filed by the Deputy Commissioner of State Tax, challenging the High Court’s judgment dated 13 November 2024 in Writ Appeal No. 2199 of 2023.

The Bench of Justice Pankaj Mithal and Justice Prasanna B. Varale agreed with the High Court’s reasoning that there was no valid acceptance of the hotel’s application for compounding, and its consistent tax payments were under Section 5. The Court dismissed the petition, affirming that the assessment could not be shifted retrospectively to Section 7, thereby conclusively ruling in favour of Hotel Sayooj.

COMMISSIONER OF CGST DELHI vsM/S CONTAINER CORPORATION OF INDIA LTD CITATION : 2025 TAXSCAN (SC) 281

The Supreme Court of India held that auction proceeds from abandoned or unclaimed cargo cannot be taxed as storage or warehousing services under the service tax regime. The case arose from a Revenue demand of over ₹5.12 crore against Container Corporation of India Ltd. for the period 2010–2015, contending that amounts retained under Section 150(2)(d) of the Customs Act, 1962 constituted taxable warehousing charges. Both the Adjudicating Authority and the CESTAT rejected the demand, ruling that such proceeds were sale consideration, not payments for services.

The Bench of Justice J.B. Pardiwala and Justice R. Mahadevan dismissed the Revenue’s review petition, noting an unexplained delay of 127 days and finding no merit in the challenge. The Court affirmed that there was no basis to interfere with the earlier dismissal of the appeal, thereby conclusively upholding the view that auction proceeds are not liable to service tax.

NARESH DILAWARI vs CHARANJITSINGH OBEROI CITATION : 2025 TAXSCAN (SC) 282

The Supreme Court of India, in a civil appeal between Naresh Dilawari and Charanjit Singh Oberoi, dealt with allegations of a forged educational qualification under the Advocates Act framework. The Bar Council of Punjab and Haryana placed on record a verification from Magadh University declaring that the B.Com (Honours) degree and mark-sheet of 1991 relied upon by Dilawari were fake.

The Bench of Justice Manoj Misra and Justice Ujjal Bhuyan observed that the authenticity of the petitioner’s degree was doubtful and warranted an independent probe. The Court directed the Central Bureau of Investigation (CBI) to inquire into the genuineness of the certificate and file its report by 30 November 2025. The matter has been listed for further hearing on 9 December 2025, pending the outcome of the CBI’s investigation.

M/S. SHIV STEELS vs THE STATE OF ASSAM CITATION : 2025 TAXSCAN (SC) 283

The Supreme Court of India ruled that tax cannot be imposed on the basis of legislative intent, analogy, or substance unless strictly covered by statute. The case arose from appeals by M/s Shiv Steels challenging reassessments under the Assam General Sales Tax Act, 1993 for assessment years 2003–04 to 2005–06. While the Gauhati High Court upheld the Revenue’s reliance on Section 21 to revive time-barred assessments beyond the three-year limitation in Section 19, the assessee contended that such reassessments were impermissible.

The Bench of Justice J.B. Pardiwala and Justice Sandeep Mehta set aside the High Court’s ruling, holding that Section 21 applies only where no assessment is made within the limitation period, not to revive those already declared time-barred. Reiterating the principle of strict interpretation of fiscal statutes, the Court quashed the reassessments and allowed the appeal, clarifying that no tax liability can be imposed outside the four corners of the statute.

UNION OF INDIA vs M/S ADANI POWER LTD CITATION: 2025 TAXSCAN (SC) 284

The Supreme Court of India dealt with the legal issue of whether movement of goods from a DomesticTariffArea (DTA) to a Special Economic Zone (SEZ) amounts to an “export” under the Customs Act, 1962. The Union of India had levied export duty under Section 12 of the Customs Act, 1962, contending that such supplies constituted exports since SEZs are treated as foreign territory for trade purposes. However, Adani Power Ltd and other companies challenged the levy, arguing that the SEZ Act, 2005, particularly Section 2(m), provides a distinct and expansive definition of “export” which deems DTA–SEZ supplies as exports only for the purpose of extending SEZ benefits, not for imposing customs duty. The Court emphasized that the charging provision under Section 12 applies only to goods physically exported out of India, and therefore, export duty cannot be imposed on DTA–SEZ transactions.

The bench comprising Justice B.V. Nagarathna and Justice R. Mahadevan dismissed the Union Government’s appeal and upheld the Gujarat High Court’s ruling in favour of Adani Power Ltd. The bench clarified that while Section 26 of the SEZ Act empowers the government to grant exemptions or concessions, it does not create a separate charge of duty independent of Section 12 of the Customs Act. Accordingly, the Court concluded that the movement of goods from DTA to SEZ constitutes a domestic supply and not an export outside India, thereby exempting such transactions from export duty. All appeals by the Union of India were consequently dismissed.

KAVERI PLASTICS vs MAHDOOM BAWA BAHRUDEEN NOORUL CITATION: 2025 TAXSCAN (SC) 285

The Supreme Court of India recently addressed the legal issue of whether a cheque bounce demand notice under Section 138(b) of the Negotiable Instruments Act, 1881 remains valid if it mentions an amount different from the actual cheque amount. The case arose from a special leave petition filed by Kaveri Plastics, after the Delhi High Court (26 February 2024) quashed its criminal complaint under Sections 138, 141, and 142 of the NI Act. The dispute originated when Nafto Gaz India Pvt. Ltd. issued a cheque for ₹1 crore in favour of Kaveri Plastics, which was dishonoured due to insufficient funds. However, the demand notices mistakenly claimed ₹2 crores, prompting the High Court to rule that the notices were invalid for not demanding the exact cheque amount.

The bench of Justice B.R. Gavai and Justice N.V. Anjaria upheld the Delhi High Court’s ruling and dismissed the appeals. The Court clarified that Section 138(b) specifically requires the notice to demand “the said amount of money,” i.e., the cheque amount alone. Any demand of a lesser or higher amount fails to satisfy the statutory requirement. Since the error was repeated in two separate notices, the Court rejected the argument that it was a mere typographical mistake. Emphasizing that penal provisions must be strictly construed, the Bench held that even minor discrepancies are fatal if the notice does not exactly match the cheque amount. Accordingly, the appeals were dismissed.

AIRPORTS AUTHORITY OF INDIA vs COMMISSIONER OF SERVICE TAX CITATION: 2025 TAXSCAN (SC) 286

The Supreme Court of India examined the issue of whether services relating to handling export cargo at airports are excluded from the ambit of service tax under the Finance Act, 1994. The Airports Authority of India (AAI), a statutory body under the Ministry of Civil Aviation, challenged the levy of service tax for the period 01.10.2003 to 31.03.2007. The dispute turned on the interpretation of Section 65(23), which defines “cargo handling service” and excludes handling of export cargo, and Section 65(105)(zzm) read with Section 66, which defines and imposes tax on “taxable services” including those provided by AAI in an airport or civil enclave.

The bench comprising Justice Pankaj Mithal and Justice Prasanna B. Varale dismissed AAI’s appeal under Section 35L of the Central Excise Act, 1944, upholding the decision of the CESTAT dated 01.03.2017. The Court held that while “export cargo” is excluded from the definition of “cargo handling service” under Section 65(23), that exclusion does not override the wider definition of “taxable service” under Section 65(105)(zzm). Since AAI provides services at airports to any person, such activities fall squarely within “taxable service” and are subject to levy under Section 66 of the Finance Act. The Court clarified that statutory provisions prevail over circulars relied upon by the appellant, and therefore, the service of handling export cargo is liable to service tax.

MANOJ KUMAR SHARMA vs PRIYANKA BANSAL CITATION: 2025 TAXSCAN (SC) 287

The Supreme Court of India recently dealt with the issue of professional misconduct by an advocate under the Advocates Act, 1961, in a case where Manoj Kumar Sharma was suspended for making scandalous allegations against complainant Priyanka Bansal. The matter arose from a statutory appeal challenging the Bar Council of India’s order dated 19 December 2023, which found the advocate guilty of misconduct and suspended him for three years from the roll of advocates.

The bench comprising Justice Surya Kant and Justice Joymalya Bagchi upheld the disciplinary order and refused to show leniency, holding that the appellant’s obstinacy in making scandalous allegations amounted to serious misconduct. The Court dismissed the appeal with costs of ₹1,00,000, directed the Collector of Agra to attach the appellant’s properties for recovery, and ordered that the amount be paid as compensation to Priyanka Bansal within three months. Further, the Court instructed the Bar Council not to renew the appellant’s license without prior permission and to submit a compliance report to the Secretary General after the suspension period. The matter was accordingly disposed of with these directions.

M/s. U.P. ASBESTOS LIMITED vs STATE OF RAJASTHAN & OTHERS CITATION: 2025 TAXSCAN (SC) 288

The Supreme Court of India dealt with the constitutional validity of Notification No. S.O.377 dated 09.03.2007, issued under Section 8(3) of the Rajasthan VAT Act, 2003, which granted VAT exemption exclusively to asbestos cement sheets and bricks manufactured within Rajasthan. A number of appeals were filed by M/s U.P. Asbestos Limited and M/s Everest Industries Limited, challenging the Rajasthan High Court’s order upholding the notification.

The bench comprising Justice B.V. Nagarathna and Justice K.V. Viswanathan struck down the impugned notification, holding that it created a fiscal barrier against identical goods manufactured outside the State and was therefore unconstitutional. The Court observed that the exemption was granted purely on the basis of the place of manufacture, without mandating the use of fly ash sourced from Rajasthan as claimed by the State. Emphasizing that taxation cannot be used as a tool for creating fiscal barriers, the Bench clarified that while States may incentivize industries, they cannot do so in a manner that offends the principle of non-discrimination under Article 304(a). Accordingly, the appeals were allowed, the Rajasthan High Court’s order was set aside, and the notification was quashed as unconstitutional.

APOLLO TYRES LTD vs THE ASSISTANT COMMISSIONER OF INCOME TAX CITATION: 2025 TAXSCAN (SC) 289

The Supreme Court of India dealt with the issue of eligibility for weighted deduction under Section 35(2AB) of the Income-tax Act, 1961, in relation to Research and Development (R&D) expenditure incurred by Apollo Tyres Ltd. The company had established two in-house R&D facilities at Perambra (Cochin) and Limda (Vadodara), both recognized by the Department of Scientific and Industrial Research (DSIR). While Apollo regularly availed normal deduction under Section 35(1), it later sought the higher 150% weighted deduction under Section 35(2AB). The DSIR, however, restricted the benefit on the ground that the mandatory cooperation agreement under Section 35(2AB)(3) was executed only on 21 August 2008, after the close of the relevant financial year. The Assessing Officer disallowed the claim citing both this delay and the absence of a revised return, and the disallowance was subsequently upheld by the CIT(A), ITAT, and the Kerala High Court, which relied on the Delhi High Court’s 2010 ruling in Apollo’s own case.

The bench comprising Justice Surya Kant, Justice Ujjal Bhuyan, and Justice N. Kotiswar Singh dismissed Apollo Tyres’ Special Leave Petition (SLP), holding that the matter had already been conclusively adjudicated. The Court recalled that Apollo had earlier challenged the DSIR’s approval period before the Delhi High Court, which dismissed its writ petition in 2010. A subsequent SLP against that decision was dismissed in 2015 on account of a delay of 1,251 days. Observing that it was “difficult to re-open the case” after multiple rounds of litigation, the Supreme Court declined to interfere and dismissed the appeal, thereby affirming that Apollo Tyres was not entitled to the weighted deduction claimed under Section 35(2AB).

COMMISSIONER OF CGST vs SONY MUSIC ENTERTAINMENT INDIA PRIVATE LIMITED CITATION: 2025 TAXSCAN (SC) 290

The Supreme Court of India is scheduled to hear next month a crucial issue on the levy of service tax on the marketing and promotion of film songs by Sony Music Entertainment India Pvt. Ltd. The case arises from an appeal filed by the GST Department against a ruling of the Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Mumbai, which had set aside service tax demands raised on Sony Music for the period 2009–2017. The Directorate General of GST Intelligence (DGGI) alleged that Sony’s contractual obligation to incur expenditure on publicity and promotion of film songs indirectly promoted the films themselves, thereby constituting Business Auxiliary Services (BAS) to film producers under the Finance Act, 1994.

The bench of Justices Manoj Misra and Ujjal Bhuyan on 9 September 2025 adjourned the matter on request of counsel and directed it to be listed after two weeks, making 7 October 2025 the tentative date for substantive hearings. Earlier, the CESTAT had ruled in favour of Sony Music, holding that once the music rights were assigned, Sony became the owner and its promotional expenditure was for its own commercial benefit, not as a service to film producers. It rejected the department’s classification under BAS, observing that there was no consideration flowing from producers to Sony. The Tribunal’s reasoning relied on precedents such as McDonalds India Pvt. Ltd. and Bhayana Builders (P) Ltd., which clarified that self-promotional expenses cannot be treated as taxable services. The Supreme Court will now examine whether such promotional spend is taxable under service tax law.

Current update: The matter is still pending before the apex court.

ASSISTANT /DEPUTY COMMISSIONER OF INCOME TAX CIRCLE vs AUSIL CORPORATIONPRIVATE LIMITED CITATION: 2025 TAXSCAN (SC) 291

The Supreme Court of India recently dealt with the legal issue of whether reassessment proceedings under Sections 148 and 148A(d) of the Income Tax Act, 1961 can be initiated once a resolution plan under the Insolvency and Bankruptcy Code (IBC), 2016 has been approved by the adjudicating authority. The case arose after reassessment notices were issued to Ausil Corporation for AY 2015–16 despite the fact that the Income Tax Department had already filed and received partial satisfaction of its claim during the Corporate Insolvency Resolution Process (CIRP).

The bench comprising Chief Justice K. Vinod Chandran and Justice Atul S. Chandurkar dismissed the Department’s Special Leave Petition, thereby upholding the Gujarat High Court’s ruling that fresh reassessment proceedings are impermissible post-approval of a resolution plan. The Court, while condoning delay, declined to interfere with the High Court’s judgment, reiterating the principle laid down in Ghanashyam Mishra & Sons v. Edelweiss ARC (2021) that all prior claims, including statutory dues, stand extinguished once a resolution plan is approved under the IBC.

M/S L.G. ELECTRONICS INDIA PRIVATE LIMITED vs COMMISSIONER OF CUSTOMS CITATION: 2025 TAXSCAN (SC) 292

The Supreme Court of India recently adjudicated on the issue of customs duty liability in relation to the classification of imported smart watches and the applicability of Notification No. 152/2009 issued under the India–Korea Comprehensive Economic Partnership Agreement (CEPA). The dispute arose when the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) upheld the Commissioner’s classification of the goods under tariff entry 8517 6290 instead of 9102 1900, denied the benefit of the exemption notification, and confirmed the duty demand against M/s L.G. Electronics India Private Limited.

The bench comprising Justice J.B. Pardiwala and Justice Sandeep Mehta set aside the Tribunal’s order and directed a refund of the duty already deposited, along with applicable interest. While affirming that the imported items were correctly identified as smart watches, the Court clarified that this classification did not preclude the company’s right to claim exemption under the CEPA notification. Observing that a valid Certificate of Origin from the Republic of Korea was furnished and that there was no mala fide conduct, the Court held that the denial of exemption was erroneous. It accordingly allowed the appeal and disposed of pending applications.

M/S SAUBHAGYA TILAK HOTELS PVT. LTD vs PRINCIPAL COMMISSIONER OF CENTRAL EXCISE CITATION: 2025 TAXSCAN (SC) 293

The Supreme Court of India recently stayed the remand order of the Chhattisgarh High Court in a case concerning the levy of service tax on alleged “Mandap Keeper Services” by Saubhagya Tilak Hotels Pvt. Ltd. The dispute arose under Section 65(105)(m) of the Finance Act, 1994 and involved the imposition of service tax for the period 2008–09 to 2011–12, following a search at the assessee’s premises and reliance on statements recorded under Section 14 of the Central Excise Act, 1944. The assessee had operated a non-air-conditioned restaurant without alcohol and supplied bakery and confectionery items, activities not subject to service tax at that time. The controversy centered on whether statements of the manager and director could be relied upon without allowing cross-examination, in violation of Section 9D of the Central Excise Act, 1944 and principles of natural justice.

The bench of Justices J.B. Pardiwala and K.V. Viswanathan issued notice in the appeal on 8 September 2025 and stayed the Chhattisgarh High Court’s order that had remanded the matter for fresh adjudication. The High Court, comprising Justices Sanjay K. Agrawal and Sanjay Kumar Jaiswal, had earlier directed the adjudicating authority to allow cross-examination of the witnesses and pass a fresh order within three months. By staying the remand, the Supreme Court has paused the fresh proceedings, while notice has been returnable in four weeks, allowing Dasti service. The Supreme Court will now examine the admissibility of the statements relied upon and the correctness of the service tax demand.

AMERICAN EXPRESS BANKING CORPORATION vs ASSISTANT DIRECTOR OF INCOME TAX CITATION: 2025 TAXSCAN (SC) 294

The Supreme Court of India recently dealt with the issue of transfer pricing under Section 92C(3) of the Income Tax Act, 1961, concerning the determination of Arm’s Length Price (ALP) for intra-group services. The case arose from a Special Leave Petition filed by American Express Banking Corporation challenging the Delhi High Court’s decision, which had upheld the ITAT’s remand directing the Transfer Pricing Officer (TPO) to recompute the ALP for intra-group services. The dispute originated from international transactions between American Express India and its Associate Enterprises, where the TPO initially made a transfer pricing adjustment of over Rs. 24 crore, and the CIT(A) had restricted the adjustment to 50% of the TPO’s determination due to lack of third-party documentation.

The bench comprising Justice J.B. Pardiwala and Justice K.V. Viswanathan dismissed the SLP, observing that there was no ground to interfere with the High Court’s order. The Supreme Court upheld the Delhi High Court’s decision, agreeing with ITAT’s finding that some intra-group services had indeed been received by the assessee and therefore the ALP could not be taken as nil. The matter was remanded back to the TPO to consider afresh, ensuring that the conditions under Section 92C(3) are satisfied before making transfer pricing adjustments for intra-group services.

COMMISSIONER OF CUSTOMS vs M/S RAPID DIAGNOSTICS PVT. LTD.ETC. CITATION: 2025 TAXSCAN (SC) 295

The Supreme Court of India recently upheld the CESTAT order allowing customs duty exemption for imported hCG Pregnancy Test Kits imported by Rapid Diagnostics Pvt. Ltd., holding that their essential character derived from agglutinating sera. The dispute arose under the Customs Tariff Act, 1975, specifically concerning the classification of the imported “hCG Pregnancy Rapid Test Strip” and “hCG Pregnancy Rapid Test Cassette” under CTH 3002, and the applicability of Notification Nos. 12/2012-Cus and 50/2017-Cus providing exemption from basic customs duty. The Department had challenged the exemption on the ground that the exemption applied only to agglutinating sera and not to finished test kits, whereas the assessee argued that the kits derived their essential character from agglutinating sera and were thus eligible for exemption.

The bench comprising Justice J.B. Pardiwala and Justice Manmohan dismissed the appeals filed by the Department, finding no reason to interfere with the CESTAT order dated 19.11.2024, which had upheld the Commissioner of Customs’ decision. The Court observed that the essential character of the kits was provided by agglutinating sera containing monoclonal hCG antibodies, and that other kit components were passive. Relying on the Tribunal’s reasoning and precedents, including Inter Care Ltd., the Court held that the classification and exemption were correct. Consequently, the appeals were dismissed, and all pending applications were disposed of.

DOMA T BHUTIA vs UNION OF INDIA CITATION: 2025 TAXSCAN (SC) 296

The Supreme Court of India recently dealt with a challenge concerning the expanded definition of “Sikkimese” under Section 10(26AAA) of the Income Tax Act, 1961, which grants income tax exemptions. The case arose from a Special Leave Petition filed by Doma T. Bhutia against the High Court of Sikkim’s order dated 4 March 2025 in W.P. (PIL) No. 01/2025, which had upheld the amendment made by Parliament following the Supreme Court’s earlier judgment in Association of Old Settlers of Sikkim and Others v. Union of India. The petitioner contended that broadening the definition diluted the distinct identity of the Sikkimese people.

The bench comprising Justice B.V. Nagarathna and Justice R. Mahadevan dismissed the petition, observing that the expansion of “Sikkimese” is limited solely for the purpose of granting tax exemption under Section 10(26AAA) and does not affect the cultural or constitutional identity of the Sikkimese community. The Court clarified that Parliament has the authority to widen the scope of a provision to extend benefits, and such a policy decision cannot constitute a grievance. The Supreme Court disposed of the case and directed that the Union of India may issue a formal notification consistent with its press release, if not already done, while also disposing of all pending applications.

DEPUTY COMMISSIONER OF INCOME TAX vs TRANS WORLD INTERNATIONAL LTD CITATION: 2025 TAXSCAN (SC) 297

The Supreme Court of India recently addressed a challenge to the reassessment proceedings initiated under Sections 148 and 148A(d) of the Income Tax Act, 1961 against Trans World International Ltd. LLC. The matter arose from a Special Leave Petition filed by the Deputy Commissioner of Income Tax, Circle 3(1)(1), International Tax, New Delhi, against the Delhi High Court’s order dated 14 August 2024 in W.P.(C) No. 16672/2022, which had quashed the reassessment order and corresponding notice. The High Court observed that the Assessing Officer’s dispute over the 95%-5% revenue bifurcation in the contract was perverse and had no legal basis, relying on the precedent set in the Fox Network decision. Consequently, the reassessment proceedings were set aside.

The bench comprising Justice J.B. Pardiwala and Justice K.V. Viswanathan dismissed the Revenue’s appeal, noting that the assessee intended to challenge the final assessment through proper statutory channels. The Supreme Court observed that there was no purpose in continuing the appeal on the issue of reopening the assessment and disposing of the matter accordingly, while also disposing of all pending applications. The Court clarified that the assessee retains the liberty to pursue remedies against the final assessment order in accordance with law.

HARSH VERMA vs STATE OF MADHYA PRADESH CITATION: 2025 TAXSCAN (SC) 298

The Supreme Court of India recently dismissed a plea seeking anticipatory bail filed by Harsh Verma, accused of involvement in large-scale fraudulent financial transactions. The matter arose from a Special Leave Petition challenging the Madhya Pradesh High Court’s order dated 20 December 2024 in MCRC No. 49671/2024, which had rejected his anticipatory bail application in connection with FIR No. 385/2023 registered at Police Station Maharana Pratap Nagar, District Bhopal Shehari, under Sections 406 and 420 of the Indian Penal Code.

The bench comprising Justice Rajesh Bindal and Justice Manmohan observed that the transactions under scrutiny involved several crores and that allegations regarding ownership of the funds were yet unresolved. Considering the gravity and magnitude of the financial dealings, the Court found no reason to grant anticipatory bail. The Supreme Court also directed the investigating agency to coordinate with the local Income Tax Department to further examine potential tax violations. Consequently, the plea was dismissed along with all pending applications.

KALYANI TRANSCO vs M/S BHUSHAN POWER AND STEEL LIMITED AND OTHERS CITATION: 2025 TAXSCAN (SC) 299

The Supreme Court of India recently upheld JSW Steel Ltd’s resolution plan for Bhushan Power and Steel Ltd (BPSL) under the Insolvency and Bankruptcy Code, 2016, agreeing with the Solicitor General of India that the Committee of Creditors’ (CoC) role continues only until the approved resolution plan is put into effect. The matter arose from a challenge to JSW’s ₹19,700 crore resolution plan, which was previously denied by the Court on May 2, 2025, citing alleged violations of Sections 30(2) and 31(2) of the IBC, and ordering liquidation of BPSL. The Supreme Court’s review addressed issues regarding the execution of the resolution plan, the CoC’s authority, and the rights of former promoters to contest NCLAT orders at a late stage.

The bench comprising Chief Justice B.R. Gavai and Justice Satish Chandra Sharma observed that the resolution plan implemented by JSW had transformed BPSL from a loss-making entity into a financially healthy company, protecting thousands of employees and maintaining the Corporate Debtor as an ongoing concern. The Court emphasized that allowing the CoC or former promoters to challenge the NCLAT ruling at this stage would undermine the intent of the IBC and confirmed that JSW’s implementation of the resolution plan is valid. The Supreme Court accordingly upheld the NCLAT’s decision authorizing the resolution plan, while maintaining status quo on liquidation proceedings to avoid procedural complications.

SANJABWTART vs KISHORE S. BORCAR & ANR. CITATION: 2025 TAXSCAN (SC) 300

The Supreme Court of India recently clarified that complaints under Section 138 of the Negotiable Instruments Act, 1881 are maintainable for dishonoured cheques issued towards repayment of cash loans, even when the loan amount exceeds ₹20,000. The ruling arose from a special appeal challenging the Kerala High Court’s decision in P.C. Hari v. Shine Varghese (2025), which had held that cash loans exceeding ₹20,000 in violation of Section 269SS of the Income Tax Act, 1961 could not constitute a “legally enforceable debt” for the purposes of the NI Act.

The bench comprising Justices Manmohan and N.V. Anjaria observed that statutory presumptions under Sections 118 and 139 of the NI Act favor the complainant once the execution of a cheque is admitted. The Court noted that procedural safeguards must be strengthened to reduce pendency in Section 138 cases, including permitting service of summons via email, WhatsApp, or dasti; establishing online payment mechanisms; and filing structured case synopses. Restoring the trial court’s conviction, the Supreme Court directed the accused to repay ₹7.5 lakh in 15 instalments and reaffirmed that income tax restrictions cannot dilute criminal liability under the NI Act, thereby upholding the enforceability of cash loan repayments through cheque bounce proceedings.