Half Yearly Tax Digest 2025: Supreme Court and High Court Cases [Part VI]

Major Relief for InterGlobe Aviation: Delhi HC exempts IGST on Re-Imported Aircraft Parts after Repairs

INTERGLOBE AVIATION LTD vs PRINCIPAL COMMISSIONER OFCUSTOMS ACC (IMPORT) NEW CUSTOM HOUSE NEW DELHI & ORS. CITATION: 2025 TAXSCAN (HC) 314

In a recent judgment, the Delhi High Court struck down the levy of Integrated Goods and Services Tax (IGST) on aircraft parts re-imported after being sent abroad for repairs, providing significant relief to airlines. The court ruled that imposing IGST on the repair cost, insurance, and freight of such re-imported parts was unjustified and amounted to double taxation.

The Court clarified that the original notification was unambiguous in restricting the levy to Basic Customs Duty (BCD), and the 2021 amendment sought to drastically alter this position. The court held that levying an additional duty on a transaction already taxed as a supply of service was unconstitutional and could not be sustained.

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Delhi HC quashes Order Levying TDS of 2% on Salesforce’s ₹633 Cr Revenue

SFDC IRELAND LIMITED vs COMMISSIONER OF INCOME TAX &ANOTHER CITATION: 2025 TAXSCAN (HC) 315

The Delhi High Court recently set aside an order by the Revenue Department imposing a Tax Deducted at Source (TDS) of 2% on ₹633.34 Crore in revenue earned by SFDC Ireland Limited (Salesforce) from conducting product reselling in India through its Indian affiliate.

Affirming that the observations in the present order were confined to the issue of withholding tax and would not preclude the AO from conducting an independent assessment as per law, uninfluenced by the present Order.

Bombay HC Rules SASF is a “Deemed Dealer” Under MVAT Act, Liable for VAT on Movable Asset Sales

Stressed Assets Stabilization Fund vs The State ofMaharashtra CITATION: 2025 TAXSCAN (HC) 317

In a recent ruling, the Bombay High Court held that the Stressed Assets Stabilization Fund (SASF) qualifies as a “deemed dealer” under the Maharashtra Value Added Tax (MVAT) Act, 2002, making it liable to pay VAT on the sale of movable assets.

The court ruled that SASF falls within the Explanation to Section 2(8) of the MVAT Act, which includes entities owned or constituted by the Central Government as deemed dealers, irrespective of whether they engage in business in the conventional sense. Dismissing SASF’s appeal, the Bombay High Court upheld the Sales Tax Tribunal’s decision. The court ruled that SASF is liable for VAT on all sales of movable property conducted in Maharashtra.

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Bombay HC Denies SASF’s Prospective Tax Relief, Upholds Retrospective VAT Liability on Past Sales

Stressed Assets Stabilization Fund vs The State ofMaharashtra CITATION: 2025 TAXSCAN (HC) 317

In a recent ruling, the Bombay High Court denied the Stressed Assets Stabilization Fund ( SASF ) the benefit of prospective tax relief, holding it retrospectively liable for VAT on past sales.

The court upheld the Maharashtra Sales Tax Tribunal’s (MSTT) decision, which rejected the appellant’s request for prospective effect under Section 56(2) of the Maharashtra Value Added Tax (MVAT) Act, 2002. The Bombay High Court upheld the Sales Tax Tribunal’s decision and ruled that the appellant must pay VAT retrospectively on all past transactions.

Apcotex Anti-Dumping Duty Dispute: Delhi HC Disposes Case after Domestic Industry Withdraws Claim for Duty Imposition

UNION OF INDIA THROUGH SECRETARY MINISTRY vs M/S APCOTEXINDUSTRIES LIMITED CITATION: 2025 TAXSCAN (HC) 321

In a notable ruling, the Delhi High Court disposed of multiple Writ Petitions pertaining to the imposition of Anti-Dumping Duty (ADD), ruling that the case has become infructuous following the domestic industry’s withdrawal of its demand for duty imposition.

The Bench observed that the domestic industry no longer pressed for the imposition of ADD for which they had informed the Government in writing. In such an event, the question of law raised by the Union of India i.e., as to whether CESTAT has jurisdiction to set aside an Office Memorandum or not would become moot, and the writ petitions herein – infructuous.

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Standard Form for Waiver of SCN and Personal Hearing Not a Substitute for Statutory Obligation: Delhi HC rules Seizure Without SCN Illegal

MOHAMED SHAMIUDDEEN vs COMMISSIONER OF CUSTOMS CITATION: 2025 TAXSCAN (HC) 319

In a recent ruling, the Delhi High Court ordered the release of goods detained by customs authorities. The court cited a failure to issue a proper show cause notice as required under Section 124 of the Customs Act, 1962. The court also questioned customs’ reliance on a standard pre-signed waiver form.

The Division bench comprising Justice Pratibha M. Singh and jJustice Dharmesh Sharma asserted the customs department’s failure to issue a valid show cause notice, ruled the detention illegal and directed the immediate release of the petitioner’s goods within two weeks. However, the court clarified that storage charges, if applicable, must be borne by the petitioner.

Cancelling GST Registration for Temporarily Closing Business and Travelling Abroad during Diwali: Madras HC Restores Registration

M/s.Golden Enterprises vs The Assistant Commissioner CITATION: 2025 TAXSCAN (HC) 322

In a rather bizarre event, the Madras High Court safeguarded the rights and restored the Goods and Services Tax (GST) Registration of a business owner whose registration was cancelled by the authorities upon notice that the business had been closed for a period of almost 2 weeks during the Diwali holidays.

In closing, the Bench directed that the Petitioner may not be eligible to utilize any Input Tax Credit (ITC) earned without being scrutinized and approved by the department. It further ruled that failure to comply with the order’s conditions would result in automatic cessation of the relief granted.

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Delhi HC Upholds ITAT Order Upholding Income Tax Addition Treating Increase in Share Capital as Sham Transaction

QUARTZ COMMECIAL PVT LTD vs INCOME TAX OFFICER WARD 20(3) CITATION: 2025 TAXSCAN (HC) 320

The High Court of Delhi upheld the Income Tax Appellate Tribunal (ITAT) order upholding income tax addition and treating increase in share capital as sham transaction. It was found that the assessee has not carried on any business activities during the year and has received share application money with a huge premium which has been invested again on the same date as share application money in various companies.

Since, the Assessee’s appeal against the impugned order dated 31.07.2017 passed by the ITAT was dismissed, the bench of Acting Chief Justice Vibhu Bakhru and Justice Tushar Rao Gedela viewed that the question of any further proceedings before the AO did not arise. The issue sought to be raised in this appeal stood concluded with the dismissal of the appellant’s appeal Quartz Commercial Private Limited v. Income Tax Officer by the order dated 9.02.2018 passed by the court.

GST Demand on Non-Taxable Receipts: Madras HC Dismisses petition on Availability of statutory remedy

M/s.Ragem Motors vs The State Tax Officer-IV (Inspection) CITATION: 2025 TAXSCAN (HC) 318

The High Court of Madras dismissed the writ petition challenging the Goods and Service Tax (GST) demand on non-taxable receipts, citing the availability of a statutory remedy.

Section 107 of the GST Act allows an appeal against an order within three months, with a one-month extension if justified. A 10% pre-deposit of the disputed tax is required. The department can appeal within six months. The Appellate Authority may confirm, modify, or annul the order, and a further appeal can be made to the GST Tribunal under Section 112 of the Act.

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Relief to General Electric: Delhi HC Quashes Income Tax Reassessment Noting Lack of Material Evidence and Mere Reliance on Past Surveys

GE GRID (SWITZERLAND) GMBH vs ASSISTANT COMMISSIONER OFINCOME TAX & ANR CITATION: 2025 TAXSCAN (HC) 323

The Delhi High Court has quashed the reassessment proceedings initiated against GE Grid (Switzerland) GmbH, a subsidiary of General Electric (GE), ruling that the Income Tax Department failed to provide any fresh material evidence to justify reopening assessments for AYs 2013-14 to 2017-18.

The Bench went on to quash the reassessment notices issued under Section 148 of the Income Tax Act observing that the Revenue failed to bring any fresh material to justify reopening the assessment. To Read the full text of the Order CLICK HERE

Bombay High Court to Decide: Should Donuts Be Taxed at 5% or 18% GST?

M/s. Himesh Foods Pvt Ltd vs Union of India & Ors CITATION: 2025 TAXSCAN (HC) 324

The Bombay High Court is set to decide whether donuts should be taxed at 5% or 18% under the Goods and Services Tax (GST) regime, a case that could have significant financial implications for bakeries and quick-service restaurant (QSR) chains across India.

The next hearing set for March 24, 2025, all eyes are on the Bombay High Court as it deliberates on the tax fate of India’s favorite sweet treat—the donut.

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No Bank Statements to Prove Transactions: Bombay HC orders Full Disallowance of Bogus Purchases u/s 69C

The Principal Commissioner of Income-tax – 25 C-10 vsShree Ganesh Developers 301 CITATION: 2025 TAXSCAN (HC) 325

In a recent ruling, the Bombay High Court ordered the full disallowance of bogus purchases under Section 69C of the Income Tax Act, citing the absence of bank statements to verify transactions.

The court reversed the ITAT’s order and directed full disallowance. The court capped the total additions at Rs. 1,00,10,773, ensuring no excess tax liability beyond the unverified purchases. For other suppliers, where purchases were substantiated with bank statements, the court upheld the ITAT’s decision.

CBDT Cannot Impose Limitation Period for Compounding through Guidelines when Income Tax Act does not Prescribe One: Bombay HC

M/s. L. T. Stock Brokers Pvt. Ltd. vs The ChiefCommissioner Of Income Tax - 2 CITATION: 2025 TAXSCAN (HC) 326

In a recent ruling, the Bombay High Court held that the Central Board of Direct Taxes (CBDT) cannot impose a limitation period for filing compounding applications through its guidelines when the Income Tax Act, 1961, does not prescribe any such restriction.

The court ruled that the Chief Commissioner had failed to exercise discretion and had instead treated the guidelines as an absolute bar. The court set aside the order dated 17.01.2024 and directed the Chief Commissioner to reconsider the compounding application, taking into account all facts and circumstances of the case. The writ petition was allowed.

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CESTAT Cannot Reject Appeal merely because Pre-Deposit was Made in Wrong Account: Delhi HC

M/S DD INTERIORS vs COMMISSIONER OF SERVICE TAX & ANR CITATION: 2025 TAXSCAN (HC) 327

The Delhi High Court ruled that an appeal cannot be denied on the grounds of defects just because a pre-deposit required by Section 35F of the Central Excise Act, 1944, for filing an appeal is made in the incorrect account, even though the integrated portal may not have been fully operational at the time.

While allowing the appeal, the order passed by CESTAT is set aside. The petition of the Petitioner is restored to its original number before CESTAT and shall now be heard on merits without any further pre-deposit.

Customs Dept. Detained Gold Chain of NRI without proper SCN or Hearing: Delhi HC Directs to Release Chain

RAHUL VATTAMPARAMBIL REMESH vs UNION OF INDIA & ORS CITATION: 2025 TAXSCAN (HC) 329

The customs department has been ordered by the Delhi High Court to release the gold chains of non-resident Indians (NRIs) who traveled from the United Arab Emirates to attend a wedding.

The court ordered that the petitioner’s gold item be released in four weeks. The same will be collected by the petitioner or his designated signatory. After confirming the petitioner’s credentials, the relevant person or agency will release the information.

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Madras High Court Revives GST Registration with Conditions

Sree Venkateswara Medical vs The Commercial Tax Officer CITATION: 2025 TAXSCAN (HC) 328

Madras High Court has revived a GST registration that was canceled for failing to file statutory returns for six consecutive months under the Central Goods and Services Tax Act, 2017 (CGST Act). The Court allowed the restoration of the registration subject to conditions.

Based on these precedents, the Court decided to extend the benefit of the Suguna Cutpiece Center judgment to the petitioner, allowing them to restore their registration subject to these conditions.

Provisional Bank Account Attachment ends Once Final Order is Passed u/s 74 of CGST Act: Supreme Court

OM PRAKASH GUPTA vs PR. ADDITIONAL DIRECTOR GENERAL &ORS CITATION: 2025 TAXSCAN (SC) 140

The Supreme Court of India in a recent matter laid reference to the obiter in a prior decision where it was held that a provisional bank account attachment under Section 83 of the Central Goods and Services Tax Act (CGST), 2017 Act ceases to have effect once a final order under Section 74 is passed.

In light of the observations made, the Supreme Court proceeded to dispose of the Special Leave Petition and all related pending applications.

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Supreme Court Directs Nowhera Shaik to Pay ₹25 Crore to ED, Warning Revocation of Bail in Heera Gold Scam Case

NOWHERA SHAIK & ANR vs UNION OF INDIA & ORS CITATION: 2025 TAXSCAN (SC) 139

The Supreme Court of India recently issued a final ultimatum to Nowhera Shaik, founder and managing director of Heera Gold Exim Pvt Ltd, to deposit ₹25 crore with the Enforcement Directorate (ED) within a period of three months or face revocation of her current bail.

The court scheduled the next hearing for July 14, 2025, by which time Shaik must either comply with the Supreme Court’s ultimatum or face immediate legal consequences.

Stamp Duty Not Payable by Wife for Flat Acquired as Part of Compromise in Divorce Case: Supreme Court

ARUN RAMESHCHAND ARYA vs PARUL SINGH CITATION: 2025 TAXSCAN (SC) 138

The Supreme Court recently excluded a wife from paying stamp duty under the Registration Act, 1908 (“Act”) if she got an apartment as part of a settlement with her husband in a divorce dispute.

The court noted that the disputed flat is clearly the focus of the agreement and, as such, is a component of the proceedings before this court. Therefore, the exclusion stipulated in Section 17(2)(vi) of the Registration Act, 1908 will be applicable, and stamp duty will not be required for the registration of the flat in question in the respondent-wife’s sole name.

Supreme Court Criticizes NCLAT’s Long Order on Delay Condonation Application Despite High Pendency of Cases

POWER INFRASTRUCTURE INDIA vs POWER FINANCE CORPORATIONLTD. & ANR. CITATION: 2025 TAXSCAN (SC) 137

The supreme court while setting aside the National Company Law Appellate Tribunal (NCLAT) order that rejected an application for condonation of delay in filing an appeal under Section 61 of the Insolvency and Bankruptcy Code, 2016 , expressed the wonder on action of spenting a great deal of time and energy crafting a 17-page ruling on a delay condonation application, despite having a large backlog of cases pending. The Supreme Court criticized the approach of NCLAT.

As a result, the Supreme Court overturned the NCLAT’s November 7, 2023 judgment, granted the plea for a delay condonation, and instructed the NCLAT to hold the appeal hearing in compliance with the law.

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Execution of Penalties under Consumer Protection Act can still be carried out despite IBC moratorium: Supreme Court

SARANGA ANILKUMAR AGGARWAL vs BHAVESH DHIRAJLAL SHETH& ORS. CITATION: 2025 TAXSCAN (SC) 136

In a recent case, the Supreme Court ruled that penalty procedures under Section 27 of the Consumer Protection Act, 1986 (“CP Act”) are exempt from the interim moratorium provided by Section 96 of the Insolvency & Bankruptcy Code, 2016 (“IBC”).

While dismissing the appeal, the court held that the moratorium under Section 96 of the IBC does not extend to regulatory penalties imposed for non-compliance with consumer protection laws and the Appellant was directed to comply with the penalties imposed by the NCDRC within eight weeks.

Attachment of Property by Income Tax Dept. Cannot be made Indefinitely Without Pursuing Steps to Resolve Matter: Delhi HC

FASTTRACK TIEUP PVT. LTD. vs UNION OF INDIA & ORS. CITATION: 2025 TAXSCAN (HC) 331

The Delhi High Court has held that the Income Tax Department cannot, suspecting escapement of tax on income by an assessee, indefinitely attach its properties without taking further steps to resolve the matter.

While granting the petition, the bench concluded that although respondent no. 2 had started the attachment process by issuing the prohibitory order, respondent no. 2 had not taken any further steps to retrieve the unpaid sum. Retaining the properties indefinitely without taking further action to address the issue is prohibited.

S.110 of Customs Act and S.67 of CGST Act are Pari Materia; No ‘Sufficient Cause’ for Continued Retention of Goods: Delhi HC

M/S KASHISH OPTICS LTD vs THE COMMISSIONER, CGST DELHIWEST CITATION: 2025 TAXSCAN (HC) 333

The Delhi High Court recently ruled that Section 110 of the Customs Act, 1962 and Section 67 of the Central Goods and Services Tax (CGST) Act, 2017 are pari materia, requiring them to be interpreted in a similar manner.

Accordingly, the Delhi High Court directed the release of the seized goods upon the petitioner making a deposit as per the valuation while also clarifying that the existence of a provisional release mechanism under Rule 140 of the CGST Rules, 2017 does not negate the requirement under Section 67(7) to show sufficient cause before extending the seizure period.

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Taxpayer Fails to Respond to SCN and Had No Business at Registered Address: Calcutta HC Upholds GST Registration Cancellation

Md. Firoz vs Assistant Commissioner CITATION: 2025 TAXSCAN (HC) 332

In a recent ruling, the Calcutta High Court upheld the cancellation of a taxpayer’s GST registration after the assessee failed to respond to a Show Cause Notice (SCN) and was found to have no business presence at the registered address.

The court ruled that no interference was warranted as the petitioner had failed to establish his case and had not availed the opportunities given to him during the proceedings. The cancellation of GST registration was upheld.

No Seizure Extension Notice Provided before Conclusion of Six-Month Period: Delhi HC Orders Release of Spectacles and Frames

M/S KASHISH OPTICS LTD vs THE COMMISSIONER, CGST DELHIWEST & ORS CITATION: 2025 TAXSCAN (HC) 333

The Delhi High Court has ruled that the GST Department’s failure to issue a notice before extending the seizure period beyond six months invalidates the continued retention of goods, while ordering the immediate release of spectacles and frames seized from the Petitioner.

In light of all the observations made, the Delhi High Court ordered the immediate release of the seized spectacles and frames upon the petitioner making a deposit as per the valuation.

Cross-Objections not Maintainable u/s 260A of Income Tax Act: Delhi High Court

PR. COMMISSIONER OF INCOME TAX vs NAGAR DAIRY PVT. LTD. CITATION: 2025 TAXSCAN (HC) 334

In a recent ruling, the Delhi High Court held that cross-objections are not maintainable under Section 260A of the Income Tax Act, clarifying that the provision does not allow respondents in tax appeals to file objections against findings that were adverse to them.

The court explained that each statute defines its own appeal rights, and Section 260A does not authorize cross-objections in any form. The court dismissed the cross-objections filed by the assessee-respondent.

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Bombay HC upholds Addition on Bogus Purchase u/s 69C of Income Tax Act in Absence of Explanation on Source

Pr. Commissioner of Income Tax-5 vs Kanak Impex (India)Ltd CITATION: 2025 TAXSCAN (HC) 336

The Bombay High Court has upheld the addition on bogus purchase under Section 69 C of the Income Tax Act,1961 as the respondent-assessee failed to prove the genuineness of the purchases.

It was the respondent-assessee’s responsibility to enter the re-assessment proceedings, fulfill the initial burden of demonstrating the purchases, and get any relevant facts. The respondent-assessee’s arguments on this matter are to be disregarded since they have not participated in the re-assessment proceedings.

Gujarat HC Order Revenue to Pay 6% Interest on Delayed Refund of ₹2 Crore under Direct Tax Vivad se Vishwas Scheme 2020

M/S SAHIL TOTAL INFRATECH PVT. LTD. vs ASSISTANTCOMMISSIONER OF INCOME TAX CIRCLE 2(1)(2) CITATION: 2025 TAXSCAN (HC) 335

In a recent ruling, the Gujarat High Court directed the Income Tax Department to pay 6% interest per annum for a period of 20 months on the delayed refund of ₹2,20,41,042 under the Direct Tax Vivad se Vishwas (DTVSV) Scheme, 2020.

Holding that the fault may not be attributed to either party, the Court ordered the Department to pay interest at 6% per annum for a period of 20 months (from June 1, 2022, to January 31, 2024), amounting to ₹22,04,104. The Court directed that this amount be paid within three months from the date of receipt of the order.

Issuing 4 Years consolidated notice is impermissible: Bombay HC Stays Rs. 71.23 Crore GST Demand

MS GRAINOTCH INDUSTRIES LTD vs THE UNION OF INDIA CITATION: 2025 TAXSCAN (HC) 338

The Bombay High Court has stayed Rs. 71.23 Crore Goods and Service Tax (GST) demand holding that issuing 4 years consolidated notice.

The court ruled that the order will be temporarily stayed until a later date since it was initially satisfied with the reasons made by the petitioner’s attorney.

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Existence of International Transaction must be Proven before Applying Transfer Pricing Benchmarking: Delhi HC

PCIT-1, NEW DELHI vs BEAM GLOBAL SPIRITS & WINE(INDIA) PVT.LTD CITATION: 2025 TAXSCAN (HC) 339

In a recent ruling, the Delhi High Court held that the existence of an international transaction must be established before undertaking a transfer pricing benchmarking analysis.

The court clarified that AMP expenses do not automatically fall within the scope of transfer pricing regulations unless there is clear evidence of an arrangement between the assessee and the foreign AE. The court dismissed the appeal and upheld the ITAT’s decision, ruling in favor of the appellant.

No Exemption to Interest on Refund Under DTVSV Scheme: Gujarat HC

M/S SAHIL TOTAL INFRATECH PVT. LTD. vs ASSISTANTCOMMISSIONER OF INCOME TAX CIRCLE 2(1)(2) CITATION: 2025 TAXSCAN (HC) 340

The Gujarat High Court has held that the interest is payable on refund under Direct Tax Vivad Se Vishwas Act 2020 (DTVSV Scheme) even in absence of the provision.

Without considering whether it is a fault on part of the petitioner to validate the bank account or whether any negligence on part of the respondents for not releasing the amount of refund, the court directed the respondents to pay the amount of interest at the rate of 6% per annum as per the calculation provided to us amounting to Rs.22,04,104/- for twenty months from 01/06/2022 to 31/01/2024 considering the entire month on amount of Rs.2,20,41,042/- within a period of three months from the date of receipt of copy of the order.

Delhi HC upholds Disciplinary Proceedings Initiated against Joint Controller General of Accounts (Administration)

MADAN MOHAN vs UNION OF INDIA CITATION: 2025 TAXSCAN (HC) 337

The Delhi High Court upheld the order initiating disciplinary proceedings against Madan Mohan, a Joint Controller General of Accounts (Administration). The bench determined that the Office Order dated 3 April 2018 was entirely lawful because it only included an internal work allocation exercise by the MOF under his Ministry.

The bench determined that the Office Order dated 3 April 2018 was entirely lawful because it only included an internal work allocation exercise by the MOF under his Ministry.

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Non-Mention of DIN Number: Andhra Pradesh HC quashes GST Assessment Order

M/s. Arrow Advertising India Private Limited vs TheAssistant Commissionerst and Others CITATION: 2025 TAXSCAN (HC) 341

Due to the Director Identification Number (DIN) not being included, the Andhra Pradesh High Court has revoked the GST assessment ruling.

The court disposed of the Writ Petition by setting aside the show-cause notice, in Form GST DRC-07, dated 28.08.2024 passed by the 1st respondent, with liberty to the 1st respondent to conduct fresh assessment, after giving notice to the petitioner and assigning a DIN number to the said order. The period from the date of the impugned assessment order, till the date of receipt of this Order shall be excluded for the purposes of limitation. There shall be no order as to costs.

Time Limit for Issuance of SCN & Order under GST Act Extended by CBIC Notification: Bombay HC stays Garnishee Notice

NTT Data Business Solutions Pvt Ltd vsUnion of India CITATION: 2025 TAXSCAN (HC) 342

Citing CBIC Notification No. 56/2023-Central Tax dated December 28, 2023, which extended the deadline for issuing show cause notices (SCNs) and orders, the Bombay High Court granted an interim stay on the garnishee notice.

The division bench, which is made up of Justices B. P. Colabawalla and Firdosh P. Pooniwalla observed that the Petitioner has not only made out a case for admission but also for grant of interim relief.The court held that a strong prima facie case is made out for granting interim relief to the Petitioner.

Madras HC Confirms Online Filing Date as GST Appeal Submission Date

Mr.Palaniyand Sharavanan vs The Deputy Commissioner (ST) CITATION: 2025 TAXSCAN (HC) 343

The Madras High Court has ruled that the online filing date should be considered the official submission date for GST appeals.

The Single Bench, comprised of Justice Mohammed Shaffiq, examined Rule 108(2) of the GST Rules and held that once a provisional acknowledgment is issued, the appeal filing date should relate to that acknowledgment. Since the petitioner had uploaded the appeal on 23.08.2024, and it was acknowledged on the same date, the Court ruled that this must be considered the valid filing date. As a result, the appeal was within the permissible limitation period under Section 107(7) of the GST Act.

No PE in India, Offshore Supply of Telecom Commodities Contracts Not Taxable : Delhi HC Rules in Nokia’s Tax Matter

THE COMMISSIONER OF INCOME TAX vs NOKIA NETWORK OY CITATION: 2025 TAXSCAN (HC) 345

The Delhi High Court in a recent ruling has held that Nokia Network OY (now Nokia Corporation) does not have a Permanent Establishment (PE) in India, thereby exempting its offshore supply transactions from taxation under Indian law.

The High Court bench consisting of Justice Yashwant Varma and Justice Ravinder Dudeja ruled that Offshore supply transactions remain non-taxable if executed outside India. Held that A subsidiary does not automatically become a PE, even if it is wholly owned, that notional interest on delayed payments cannot be taxed unless actually received. The Court also asserted that Bundled software sales do not qualify as royalty payments.

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Tax Demand Contradicts going Concern Exemption: Madras HC Orders Re-Assessment

Frontline Wind Energy Private Limited vs The AssistantCommissioner (ST) CITATION: 2025 TAXSCAN (HC) 344

The Madras High Court observed that the GST demand on a going concern transfer was arbitrary and unsustainable as it contradicted the tax department’s earlier notice.

The court found the demand to be arbitrary and unsustainable. Consequently, it set aside the impugned order and directed the respondent to pass a fresh order based on the merits and under the law.

Absence of AO’s Signature and DIN Number on Form GST DRC-07 Assessment Order: Andhra Pradesh HC Sets Aside Order

M/s. Teju Granites vs The Assistant Commissioner StateTaxes Markapur Circle CITATION: 2025 TAXSCAN (HC) 346

The High Court of Andhra Pradesh in the recent ruling, set aside Form GST DRC-07 assessment order due to absence of Assessing Officer (AO)’s signature and Document Identification Number(DIN).

The two member bench comprising R Raghunandan Rao(Justice) and Dr. K.Manmadha Rao(Justice) set aside the assessment order in Form GST DRC-07, dated 30.06.2022, and allowed the 1st respondent to conduct a fresh assessment with notice and a signature on the order. The time between the impugned order and this decision was excluded for limitation purposes. No costs were awarded.

No General Penalty u/s 125 if Specific Penalty for Late Filing of GST Returns u/s 47 is Levied: Madras HC

Tvl.Jainsons Castors & Industrial Products vs TheAssistant Commissioner (ST) CITATION: 2025 TAXSCAN (HC) 347

The Madras High Court recently delivered a highly significant judgment clarifying that there can be no simultaneous applicability of late fees for belated filing of Goods and Service Tax ( GST ) returns under section 47 and general penalties under section 125 under the Tamil Nadu Goods and Services Tax ( TNGST ) Act, 2017.

Accordingly, the Court quashed the general penalty of ₹50,000 inclusive of ₹25,000 CGST and ₹25,000 SGST while upholding the applicability of late fee imposed under Section 47.

Madras HC Stays ED Attachment of Director S. Shankar’s ₹10Crore Property in ‘Enthiran’ PMLA-Copyright Infringement Case

The Madras High Court on Tuesday (11 March, 2025) stayed a prior order passed by the Enforcement Directorate (ED) provisionally attaching assets worth ₹10.11 crore belonging to revered Tamil film director S. Shankar.

The Madras High Court found merit in the plea raised by S. Shankar, and ordered a stay on the attachment of the property while directing the agency to file its counter arguments by April 21, 2025.

Power to Remand u/s 107(11) of GST Act: Telangana HC allows Petition on Non-Consideration of Jurisdiction Objection

M/s. Sreenidhi lnternational Pvt. Ltd vs The JointCommissioner of Central Tax CITATION: 2025 TAXSCAN (HC) 348

The Telangana High Court allowed writ petition citing violation of natural justice principle. It was found that there was breach of principles of natural justice and for not considering the objection of jurisdiction.

A division bench of Justice Sujoy Paul and Dr. Justice G.Radha Rani viewed that “If activity is ‘exempted’, the question of imposition of tax does not arise. Sadly, this relevant aspect/ objection has escaped notice of the authority, who has passed the impugned order. . The said objection certainly goes to the root of the matter and relates to the competence of authority in subjecting the petitioner to impugned proceedings. Thus, for twin reasons namely for breach of principles of natural justice and for not considering the objection of jurisdiction, which goes to the root of the matter, we are not inclined to relegate the petitioner to avail alternative remedy.”

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Pr Commissioner of Income Tax has Authority to Cancel Registration of Assessee even without Decision from Assessing Authority: Kerala HC

THE PRINCIPAL COMMISSIONER OF INCOME TAX vs LAST HOURMINISTRY CITATION: 2025 TAXSCAN (HC) 349

The Kerala High Court declared the principal commissioner’s power to terminate an assessee’s registration without awaiting the assessing authority’s action. Judges A.K. Jayasankaran Nambiar and Easwaran S., who made up the Division Bench, noted that Section 12AA’s provisions give the Principal Commissioner the authority to decide whether the conditions listed in Sections 12AA(3) and 12AA(4) of the Income Tax Act are necessary to order the cancellation of the registration that was given to the Trust under Section 12A of the Income Tax Act, 1961.

The bench held that the Principal Commissioner is not required by the legislative provisions to wait for the Assessing Authority’s conclusion before issuing an order terminating an assessee’s registration under Section 12A of the Income Tax Act. The bench overturned the Appellate Tribunal’s ruling and granted the appeal.

SCN u/s 29 CGST Act must reflect Reasons and Intent of Retrospective Cancellation of Registration: Delhi HC

JSD TRADERS LLP vs ADDITIONAL COMMISSIONER, CGST & ANR CITATION: 2025 TAXSCAN (HC) 350

The Delhi High Court has been made clear that a decision to cancel a trader’s GST registration with retroactive effect will not be upheld unless the authority’s intentions and the reasons for the cancellation are reflected in the show cause notice.

As a result, the Department was given permission to continue against the Petitioner only after being fully informed of the facts supporting that opinion in accordance with Section 29(2)(e)

Bombay HC Directs RBI to Accept ₹20 Lakh Demonetized Currency due to Seizure by Income Tax Department Prior to Bank Deposit Deadline

Ramesh Bapurao Potdar vs The Union of India CITATION: 2025 TAXSCAN (HC) 351

In a significant ruling, the Bombay High Court directed the Reserve Bank of India (RBI) to accept and exchange ₹20 lakh in demonetized currency notes held by a Kolhapur resident since their cash was seized by the Income Tax Department prior to the December 30, 2016 deadline for bank deposit of the now-demonetized ₹500 and ₹1000 currency notes.

The RBI was directed to verify the notes and release an equivalent amount in legal tender to petitioner no.1 on behalf of all petitioners. Additionally, petitioner no.1 was directed to indemnify the RBI against any future claims from the other petitioners, and this process was required to be completed within seven days of receiving the specified bank notes.

GST: Timeline for Issuing SCN u/s 73(2) is Mandatory, says Andhra Pradesh HC

M/s. The Cotton Corporation of India vs AssistantCommissioner (ST) (Audit) (FAC) CITATION: 2025 TAXSCAN (HC) 352

The Andhra Pradesh High Court ruled that the time limit specified in AP GST Act 73(2) for the issuance of a show-cause notice about a purportedly inadequate tax payment, etc., is obligatory.

The High Court noted that if a time frame for a certain activity is expressed in terms of months, the cutoff date would be the corresponding date of that month. The Court determined that since the deadline for issuing an injunction was 28.02.2024, the three months that would pass after this date would be 28.11.2024. Given that the notice was sent on November 30, 2024, it would have passed the deadline set forth in Section 73(2) of the GST Act. The court quashed the SCN and allowed the petition.

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Delay in Finalizing Gold Jewellery Import Assessment: Delhi HC Directs Release of Bank Guarantee with Interest

M/S OM GEMS AND JEWELLERY vs DEPUTY COMMISSIONER OFCUSTOMS (IMPORT) AIR CARGO COMPLEX NSCBI AIRPORT & ORS CITATION: 2025 TAXSCAN (HC) 354

The High Court of Delhi directed the release of the Bank Guarantee with interest due to an unjustified delay in finalizing the provisional assessment of imported gold jewellery.

The Court noted a serious lapse in the reply affidavit from the Commissioner of Customs, Calcutta, as it failed to consider the December 14, 2023, judgment and warned against such errors. It further stated that if the Bank Guarantee with interest was not released, the responsible officer would be held personally accountable, and the assessee could file an application before the Court.

Deduction of Bad Debts u/s 36 Income Tax Act only if Lends in Ordinary Course of Banking/ Money Lending Business: Delhi HC

PRINCIPAL COMMISSIONER OF INCOME TAX vs WGF FINANCIALSERVICES PVT. LTD CITATION: 2025 TAXSCAN (HC) 355

The Delhi High Court has made it clear that allowance in respect of bad debts as an expense under Section 36 of the Income Tax Act, 1961, is permissible only if the assessee represents money lent in the ordinary course of business of banking or money lending.

The court struck aside an ITAT ruling permitting the Respondent-assessee, a financial services business, to claim over ₹27 crore as bad debt of a borrower, which was a group company of the Assessee.

Allahabad HC quashes GST Demands on Merged Max Ventures, Rules Proceedings against Non-Existent Entities Invalid

Max Estates Limited vs Union of India and another CITATION: 2025 TAXSCAN (HC) 357

In a recent judgment, the Allahabad High Court quashed the GST demands issued against Max Ventures and Industries Limited after its merger with Max Estates Limited, ruling that tax demands made against a company that had ceased to exist due to merger are invalid.

The court allowed the government to pursue tax proceedings against the appropriate entity, Max Estates Limited, if permissible under the law.

Claim of Refund of Excessive TDS collected under CGST Act: Telangana HC directs L&T to File Appeal before Adjudicating Authority

L & T PES JV vs Assistant Commissioner of State Tax CITATION: 2025 TAXSCAN (HC) 356

The Telangana High Court held that in the absence of the aforesaid material, information and documents to substantiate the claim of refund of excessive Tax Deducted at Source (TDS) collected under the Central Goods and Service Tax (CGST) Act, 2017, it would be difficult for the Bench in exercise of writ jurisdiction, to grant any relief to the petitioner.

The petitioner shall be at liberty to approach the adjudicating authority with relevant material and on such submission, the adjudicating authority shall consider the same and pass appropriate orders for refund of TDS amount in the event of petitioner furnishing appropriate, cogent documents in proof of discharge of liability in the State of Maharashtra after duly affording opportunity to both the parties.

Mismatch between Figures and Words of Cheque Amount Would Not Invalidate Cheque; Merits Trial: Delhi HC

NITESH YADAV vs STATE NCT OF DELHI & ANR CITATION: 2025 TAXSCAN (HC) 358

In a recent ruling, the Delhi High Court highlighted a specific instance wherein a mismatch between the figures and words in a cheque does not automatically invalidate it, holding that such disputes must be resolved through a trial.

In conclusion, the High Court ruled that technical defects should not defeat the object of the NI Act, which is to uphold the credibility of negotiable instruments. It held that the complaint under Section 138 of the NI Act was maintainable and directed the Metropolitan Magistrate, Rohini District Court, to proceed with the trial.

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Centre’s Exceptional & Discretionary Power to Relax Conditions Rule 9C of Income Tax Rules, not subject to Judicial Review: Delhi HC

CARGILL INDIA PRIVATE LIMITED vs CENTRAL BOARD OF DIRECTTAXES CITATION: 2025 TAXSCAN (HC) 359

The Delhi High Court has ruled that the Central government’s authority to relax restrictions outlined in Section 72A of the Income Tax Act, 1962 and Rule 9C of the Income Tax Rules 1962 is extraordinary, discretionary, and not normally subject to judicial review.

As a result, the Court denied the petition, stating that even after accounting for the longer time frame for meeting the requirement, the Petitioner had failed to meet the specified condition, which was to achieve production equal to at least 50% of the installed capacity of the amalgamating company’s undertaking.

Disagreement With Dept Regarding Classification of Goods for Customs Duty Levying Not Amount to ‘Suppression of Facts’: Delhi HC

M/S ISMARTU INDIA PVT. LTD vs UNION OF INDIA AND OTHE CITATION: 2025 TAXSCAN (HC) 360

The Delhi High Court has held that merely because there is disagreement between the Customs department and a trader regarding the classification of the latter’s goods for the purpose of levying duty, it does not mean that the trader has indulged in ‘suppression of facts’ from the Department.

While allowing the appeal, the Court also cautioned the Department against mere incantation of the provisions of the Section without any substance to back it up and quashed the impugned SCN.

S. 28(4) and S. 28(1) under Customs Act Operates separately: Delhi HC

M/S ISMARTU INDIA PVT. LTD vs UNION OF INDIA AND OTHERS CITATION: 2025 TAXSCAN (HC) 360

The Delhi High Court has held that notices under Section 28(1) and Section 28(4) of the Customs Act 1962 operate in different scenarios and even by an exaggerated stretch, cannot possibly be said to be interchangeably issued. Section 28 relates to recovery of duties not levied or not paid or short-levied or short-paid or erroneously refunded. It provides for two separate types of notices.

It was noted that notices under both provisions cannot be issued in cases where (i) the factual matrix is nearly identical, (ii) the reports are submitted by the same chartered engineer, and (iii) the conclusions are nearly identical. This is because Section 28(1) can only function in the absence of the conditions outlined in Section 28(4).

Madras HC directs Disposal of Pending Appeal for AY 2019-20 within Four Months Amid Recovery Proceedings

M/s.Ashoka Textiles vs The Assistant Commissioner ofIncome Tax CITATION: 2025 TAXSCAN (HC) 361

The Madras High Court, directed the disposal of a pending appeal for Assessment Year(AY) 2019-20 within four months amid recovery proceedings.

A single member bench comprising Vivek Kumar Singh (Justice) instructed the third respondent to review the petitioner’s appeal dated May 22, 2024, on its merits and issue appropriate orders as per the law within four months of receiving a copy of the order, after granting the petitioner a fair opportunity. It also clarified that it had not given any opinion on the merits of the case, leaving the decision to the third respondent. In conclusion, the writ petition was disposed of.

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