Half Yearly Tax Digest 2025: Supreme Court and High Court Cases [Part XVII]
This Half Yearly Digest analytically summarises all the Supreme Court and High Court Tax Decisions in the First Half of 2025, as reported at Taxscan.in
![Half Yearly Tax Digest 2025: Supreme Court and High Court Cases [Part XVII]](https://images.taxscan.in/h-upload/2025/07/21/2067182-half-yearly-tax-digest-2025-supreme-court-and-high-court-cases-supreme-court-cases-taxscan.webp "Half Yearly Tax Digest 2025: Supreme Court and High Court Cases [Part XVII]")
This Half Yearly Digest analytically summarises all the Supreme Court and High Court Tax Decisions in the First Half of 2025, as reported at Taxscan.in. DGGI’s Letter Quantifying GST demand and Penalty is Only a Response, Not Order: Delhi HC Directs to Issue SCN SHASHI KUMAR CHOUDHARY vs DEPUTY DIRECTOR DIRECTORATEGENERAL OF GST INTELLIGENCE DELHI ZONAL UNIT CITATION : ...
This Half Yearly Digest analytically summarises all the Supreme Court and High Court Tax Decisions in the First Half of 2025, as reported at Taxscan.in.
DGGI’s Letter Quantifying GST demand and Penalty is Only a Response, Not Order: Delhi HC Directs to Issue SCN
SHASHI KUMAR CHOUDHARY vs DEPUTY DIRECTOR DIRECTORATEGENERAL OF GST INTELLIGENCE DELHI ZONAL UNIT CITATION : 2025 TAXSCAN (HC) 981
In a recent ruling, the Delhi High Court has held that a letter issued by the Directorate General of GST Intelligence ( DGGI ) quantifying GST demand and penalty in connection with a seizure of areca nuts is not an adjudication order but merely a response to the taxpayer's request.
After considering both sides, the Division Bench ruled that the said communication cannot be treated as an adjudication order. The Court stated that the demand raised in the letter was conditional upon the petitioner’s willingness to pay and release the goods, and not a final determination under law.
The High Court directed the GST authorities to issue a proper show cause notice as per legal provisions. The court directed the petitioner to approach the appropriate authority for provisional release of the goods furnishing a bank guarantee.
Supplier’s GST Registration Cancelled, No Tax Paid: Allahabad HC Rejects Buyer’s ITC Claim, Refuses to Interfere S. 74 Order
Trendships Online Services Private Limited vs CommissionerCommercial Taxes U.P. At Lucknow And Another CITATION : 2025 TAXSCAN (HC) 982
The Allahabad High Court has dismissed the writ petition denying its claim for input tax credit (ITC) on purchases from a supplier whose GST registration had been cancelled and who had failed to deposit tax with the government.
The High Court held that Section 16(2)(c) imposes a clear condition that tax must be actually paid to the Government for ITC to be availed. The Court noted that despite issuance of tax invoices, the petitioner failed to demonstrate that the supplier had deposited the corresponding tax. As such, the benefit of ITC could not be extended.
The Court further stated that the buyer bears the duty of proving the legitimacy of the transaction, including the actual payment of taxes and the physical transfer of the items.
Assessee Not Informed AO about Income Tax Assessment Objections Pending before DRP: Bombay HC Slaps ₹10,000 Cost on Petitioner
Zarah Rafique Malik vs Income Tax Officer IT Ward CITATION : 2025 TAXSCAN (HC) 983
The Bombay High Court recently quashed a final assessment order and remitted the matter to the Dispute Resolution Panel (DRP), noting that the petitioner had filed objections to the draft assessment order before the DRP but had inadvertently failed to inform the assessing officer (AO) of the same.
The bench comprising Justice M.S. Sonak and Justice Jitendra Jain noted that, although the AO was not at fault due to the petitioner’s failure to intimate him about the pendency of objections before the DRP, the peculiar facts of the present case, which were similar to those in the Sulzer Pumps India Pvt Ltd case, warranted setting aside the assessment order.
Simultaneous Action by Centre and State GST Raises Jurisdiction Issue: Gauhati HC Bars Coercive Steps
SHASHI KUMAR CHOUDHARY vs THE STATE OF ASSAM AND 11 ORS CITATION : 2025 TAXSCAN (HC) 984
The Gauhati High Court has restrained both Central and State GST ( Goods and Services Tax ) authorities from taking any coercive action against the petitioner in a case where simultaneous proceedings were initiated by both tax authorities on the same set of facts.
Justice Arun Dev Choudhary, while granting their prayer, directed that the respondents file their replies by 1 June 2025, with the petitioner allowed to file a rejoinder within one week thereafter. The Court also directed that an extra copy of the writ petitions be furnished to the respondents' counsel by 19 May 2025.
Considering the overlapping nature of the issues in the two petitions, the Court ordered that both be taken up together and made it clear that an effort will be made to dispose of the petitions on the next date of hearing.
Calcutta HC Sets aside Order passed on Non Compliance of S. 107(12) of CGST Act
Sudarshan Sarker vs The Union of India & Ors. CITATION : 2025 TAXSCAN (HC) 985
The Calcutta High Court has set aside the order passed on non compliance of section 107(12) of Central Goods and Service Tax (CGST) Act, 2017. The court found that the order impugned is an unreasonable order and does not comply with the provisions of Section 107(12) of the said Act .
Taking into consideration the fact that the order impugned is unreasoned order and does not comply with the provisions of Section 107(12) of the said Act and since there appears to be no reasons for rejecting the appeal on merit, the single bench of Justice Raja Basu Chowdhury set aside the order and remanded the matter back to the appellate authority for fresh adjudication on merit.
Discontinued Business Entitled to GST Refund of Unutilised ITC: Sikkim HC allows Refund of ₹4.37 Cr to SICPA India
SICPA India Private Limited and Another vs Union of Indiaand Others CITATION : 2025 TAXSCAN (HC) 986
The High Court of Sikkim has held that a business entity is entitled to claim a refund of unutilized Input Tax Credit ( ITC ) under Goods and Services Tax ( GST ) even after its discontinuation. The Court directed the refund of ₹4.37 crore of unutilized ITC.
The bench of Justice Meenakshi Madan Rai observed that “in the instant matter there is no express prohibition in Section 49(6) read with Section 54 and 54(3) of the CGST Act, for claiming a refund of ITC on closure of the unit. Although, Section 54(3) of the CGST Act deals only with two circumstances where refunds can be made, however the statute also does not provide for retention of tax without the authority of law. Consequently, I am of the considered view that the Petitioners are entitled to the refund of unutilized ITC claimed by them and it is ordered so.”
3-Year Inaction on Income Tax Appeal: Madras HC Sets 12-Week Deadline for CIT(A)
Vadivelu Anbazhagan vs The Commissioner of Income Tax(Appeals) CITATION : 2025 TAXSCAN (HC) 987
The Madras High Court has directed the Commissioner of Income Tax (Appeals) [CIT(A)] to dispose of an income tax appeal pending for over three years within a strict timeline of 12 weeks.
Considering the submission of the prolonged pendency and limited nature of the relief sought, the High Court directed the respondent authority to dispose of the appeal within 12 weeks from the date of receipt of the court’s order, after affording a reasonable opportunity for personal hearing.
JusticeKrishnan Ramasamy clarified that it had not expressed any opinion on the merits of the appeal, leaving it to the authority to decide the matter independently and in accordance with the law. With these observations, the writ petition was disposed of without any order as to costs.
GST Officers Must Apply Mind, Not Just Follow Formality in Serving Notices: Madras HC
Tvl.Metro Computers vs The Deputy State Tax Officer CITATION : 2025 TAXSCAN (HC) 988
The Madras High Court has observed that GST ( Goods and Services Tax ) officers must apply their mind and not treat the service of notices as a mere formality, especially when taxpayers do not respond to electronic communications.
The Court noted that while uploading notices on the GST portal constitutes valid service under the law, such service cannot be considered effective when there is repeated non-response from the taxpayer. In such situations, the officer is expected to explore other valid modes of service under Section 169 of the GST Act such as registered post or email to ensure actual receipt and effective communication.
Justice Krishnan Ramasamy cautioned that merely fulfilling procedural formalities, without ensuring actual service, results in ineffective adjudication and unnecessary litigation, burdening both taxpayers and judicial forums. It also noted that officers must apply their minds and adopt alternate modes of service when warranted, to uphold the purpose and spirit of the GST Act.
Goods Exempted from BCD Can Still Attract Additional Duty Unless Specifically Exempted: Madras HC
Transasia Bio-Medicals Ltd vs Union of India CITATION : 2025 TAXSCAN (HC) 989
In a recent ruling, the Madras High Court has held that goods exempted from Basic Customs Duty ( BCD ) can still be subjected to additional duty under the Customs Tariff Act unless there is a specific exemption granted under the relevant statutory provisions.
Chief Justice K R Shriram and Justice Mohammed Shaffiq observed that “the goods imported, even though exempted from basic customs duty, may still be subject to levy of additional duty under the respective enactments and they would be so subject unless and until they are specifically exempted by the competent authority in exercise of the powers vested under those respective enactments from such additional duty.”
GST Pre-deposit through Personal Ledger Account Held Valid: Allahabad HC Follows Madras HC Ruling in Ford India Case
M/S Vinod Auto Sales Thru. Proprietor Shri Vinod KumarVerma vs Principal Chief Commissioner,Gst And Central Excise CITATION : 2025 TAXSCAN (HC) 990
The Allahabad High Court has held that a pre-deposit made through a Personal Ledger Account for the purpose of filing an appeal under the GST ( Goods and Services Tax ) Act is valid and cannot be rejected merely on procedural grounds.
The Court relied on the Madras High Court’s ruling in the case of M/s. Ford India Pvt. Ltd. v. The Office of the Joint Commissioner (ST), GST and Another to reach its conclusion.
During the hearing, the court noted that the issue had already been conclusively dealt with by the Madras High Court in Ford India, where it was held that a pre-deposit made through the Electronic Credit System (ECS) is valid and in compliance with Section 107(6)(b) of GST Act.
Income Tax Deduction u/s 10AA Cannot Be Denied for Delay in Filing Form 56F: Madras HC Dismisses Revenue's Appeal
The Principal Commissioner of Income Tax-1 vs AstrotechSteels Private Limited CITATION : 2025 TAXSCAN (HC) 991
The Madras High Court has held that the income tax deduction under Section 10AA cannot be denied on the grounds of delay in the filing of Form 56F.
Chief Justice K R Shriram and Justice Mohammed Shaffiq observed that “Assessee having duly fulfilled the substantial requirement as well as the procedural requirement, though there is a minor technical breach in fulfillment of the procedural requirement, the CIT(A) as well as the ITAT have opined that the delay in filing Form 56F would not be fatal to the substantive claim of the assessee. In fact, what has also weighed in the mind of the ITAT is that the same claim had been allowed to assessee and this was the sixth assessment year of claiming the amount of deduction.”
GST ITC Denied for Late Filing of GSTR-3B: Calcutta HC Orders Reconsideration in Light of Section 16(5)
M/s. Diamond Timber Industries vs Superintendent of CGST& CX CITATION : 2025 TAXSCAN (HC) 992
The Calcutta High Court has ordered reconsideration of Input Tax Credit ( ITC ) in the light of new Section 16(5) of the Goods and Services Tax ( GST ) which was disallowed on the ground that the petitioner had filed the GSTR-3B return belatedly.
It ruled that “Prima facie upon going through the materials on record since it appears that the petitioner seeks the benefit of Section 16(5), having regard to the insertion of this Section in the GST Act and noting that the actual date of submission of the return concerning tax period August, 2019 to March, 2020 is not later than 14th January, 2021, I am of the view that the matter should be remanded back to the proper officer for the petitioner to avail the benefit of Section 16(5) of the said Act.”
Adopted Son’s Plea for Compassionate Appointment: Madras HC Directs Commercial Tax Dept to Decide Within Six Weeks
R.K.Guru Hari Haara Suthan Son of Late S.Sathis Kumar vsThe Commissioner of Commercial Taxes CITATION : 2025 TAXSCAN (HC) 993
In a recent ruling, the Madras High Court has directed the Commercial TaxesDepartment to take prompt action on a compassionate appointment application filed by an adopted son of a deceased tax officer.
Justice C. Kumarappan, while disposing of the writ petition, instructed the petitioner to furnish the required documents within four weeks. Thereafter, the commercial Department was directed to consider the application on its merits and in accordance with law within six weeks.
Bogus Claims of Huge Amount: Himachal Pradesh HC Upholds PMLA Offence relying on ‘reasons to believe’
Vikas Bansal vs Directorate of Enforcement CITATION : 2025 TAXSCAN (HC) 994
The High Court of Himachal Pradesh has upheld the Prevention of Money Laundering Act (PMLA), 2002 offence relying on reason to believe on being part of a bogus claim of huge amount.
The Court has held that the arrest of the petitioner was not in violation of Section 19(1) of the Act, the remand of the petitioner by the Court of Judicial Magistrate can also not be faulted with, as the satisfaction of Judicial Magistrate is also confined to ensuring that the provisions of Section 19(1) of the Act are complied with in letter and spirit.
The discrepancies pointed out in the order of Judicial Magistrate, which were specifically referred to by Senior Counsel for the petitioner, also do not render either arrest or remand of the petitioner to be bad, for the reason that when the foundation of the arrest of the petitioner is being upheld by the Court, the edifice would also survive.
Delay in Assessment Not Assessee’s Fault: Madras HC Allows Samathana Scheme Benefit for Commercial Tax Arrears
RR Hotel vs The Commissioner CITATION : 2025 TAXSCAN (HC) 995
The High Court of Madras,allowed the benefit of the New Samathana Scheme 2023 to the assessee for commercial tax arrears relating to the assessment years 2015-16 to 2017-18, noting that the delay in completing the assessment was not attributable to the petitioner.
The Apex Court noted that the Order, when read as a whole, indicated that the phrase "pending adjudication" could not be interpreted to exclude cases where appeals were pending. It clarified that proceedings remain pending during appeal and, therefore, eligible for settlement under the Scheme.
It was further held that denying the benefit of settlement to co-noticees merely because the adjudication had concluded and appeal was pending would lead to an unreasonable and discriminatory classification, which must be avoided.
17-Year Delay in Adjudication: Madras HC Quashes Service Tax SCN Despite Department’s Call Book Justification
M/s.DXC Technology India Private Limited vs The JointCommissioner of GST and Central Excise CITATION : 2025 TAXSCAN (HC) 996
In a recent decision, the Madras High Court quashed two service tax show cause notices after finding that there was an unjustified 17-year delay in adjudicating the matter. The court held that such a long delay, even though the case was referred to the call book, violated principles of fairness and could not be allowed to continue.
The single bench led by Justice C. Saravanan observed that despite the case being placed in the call book, the delay of over 17 years without a convincing explanation was not acceptable. The court found that the continuation of proceedings after such a long gap was arbitrary and went against Article 14 of the Constitution, which guarantees equality before the law.
Challenge on Service Tax Exemption on Emergency fire services: Orissa HC Restore matter for re-adjudication based on Notification
M/s.Fire & Safety Technology Service Pvt. Ltd. vsAsst. Commissioner of GST & Central Excise CITATION : 2025 TAXSCAN (HC) 997
In a recent case, the Orissa High Court has restored the matter for readjudication against challenge on service tax exemption on emergency fire services based on the notification.
A division bench of Justice Biraja Prasanna Satapathy and Justice Murahari Sri Raman set aside the impugned order, and the matter was restored to the authority. Further held that “Within three weeks from date, the petitioner must communicate certified copy of the order and his contention to the adjudicating authority. The authority will then consider the contention and pass a fresh order. In the event petitioner does not file his contention by 5th July, 2025, the impugned order will stand automatically restored.”
GST Notice Returned “Addressee Left”: Madras HC Stresses Dept’s Duty to Ensure Proper Delivery Through Alternative Means
P. Godwin Prasanna vs The Union Of India CITATION : 2025 TAXSCAN (HC) 998
In a recent ruling, the Madras High Court set aside a GST assessment order after finding that the notice was not served at the correct address of the taxpayer. The court emphasized that when delivery of a notice fails, the GST department must take alternative steps to ensure the taxpayer is informed and given an opportunity to respond.
A single bench led by Justice Krishnan Ramasamy held that the assessment order was passed in violation of natural justice. The court emphasized that once a notice is returned undelivered, the department is expected to take further steps to ensure that the taxpayer is properly informed. Since this was not done, the petitioner was denied a fair opportunity to be heard.
Revenue Fails to Obtain Mandatory Approval u/s 151(ii) for Cases Over ₹50 Lakh Beyond Three Years: Madras HC Quashes Reassessment
Core Logistic Company vs The Assistant Commissioner ofIncome Tax CITATION : 2025 TAXSCAN (HC) 999
In a recent judgment, the Madras High Court quashed a reassessment order issued by the Income Tax Department against Core Logistic Company after finding that the notice was issued without the proper legal approval required under Section 151(ii) of the Income Tax Act, 1961. The case involved reassessment for the assessment year 2016–17, where the department sought to reopen the case and raised a tax demand exceeding Rs. 3.65 crore.
The single bench led by Justice Krishnan Ramasamy observed that under Section 151(ii), cases where the alleged escaped income is more than Rs. 50 lakh, and where more than three years have passed since the relevant assessment year,require approval from a higher-level authority. Since this condition was not met in the present case, the reassessment notice was issued without jurisdiction.
Section 9(a)(i) Bars Vivad Se Vishwas Scheme Relief in Search Cases Exceeding ₹5 Crore Disputed Tax: Madras HC
M/s.Future Plus Enterprise vs The Principal Commissionerof Income tax CITATION : 2025 TAXSCAN (HC) 1000
In a recent decision, the Madras High Court upheld the rejection of declarations filed under the Direct Tax Vivad Se Vishwas Act, 2020, holding that Section 9(a)(i) of the Act bars relief in search-based assessments where the disputed tax exceeds Rs. 5 crore.
A single bench led by Justice Krishnan Ramasamy agreed with the revenue’s position and held that Section 9(a)(i) clearly excludes search-based assessments involving disputed tax above Rs. 5 crore from the scope of the scheme. The court rejected the argument that this exclusion does not apply when only the penalty is under dispute, holding that the nature of the original assessment and the amount of tax assessed remain relevant.
Denying Benefits of SVLDR Scheme is contrary to object of scheme : Himachal Pradesh HC allows Time to pay Dues during Covid Pandemic
East Bourne Hotels Pvt. Ltd vs Union of India & Ors CITATION : 2025 TAXSCAN (HC) 1001
In a recent case, the Himachal Pradesh High Court has ruled that denying the benefits of SVLDR Scheme would not only be contrary to the object of the scheme but would also be injustice to the petitioner declarant who otherwise was eligible. The bench further allowed the time to pay dues considering the covid pandemic.
The court viewed that the petitioner deserves to be granted another chance to make the payment after associating it so as to arrive at the amount due payable. The bench quashed and set aside the demand notices, 9 SVLDRS-3 Forms issued on 28.01.2020 (forming part of Annexure P-12 (Colly), 9 SVLDRS-3 Forms issued 25.02.2020 and letter Annexure P-15 whereby the respondent department has upheld its calculation and the respondents are directed to recalculate the correct liability of the petitioner under the amnesty scheme after associating and affording an opportunity to the petitioner.
Madras HC Quashes Customs Order for Denial of Duty Drawback Claim of 2015 Without Issuing Mandatory Deficiency Memo u/r 13(3)(a)
M/s.Royale Marine Impex Pvt. Ltd vs The AssistantCommissioner of Customs CITATION : 2025 TAXSCAN (HC) 1002
The Madras High Court, in a recent ruling, quashed the order passed by the Assistant Commissioner of Customs denying duty drawback claims filed in 2015.
The Court held that the customs authority had failed to follow the mandatory procedure under Rule 13(3)(a) of the Customs, Central Excise Duty and Service Tax Drawback Rules, 1995, by not issuing a deficiency memo within the prescribed timeline before rejecting the claims.
Moreover, the Court noted that the impugned order did not reflect or discuss the mandatory provisions or the contentions raised by the petitioner, rendering it a non-speaking order.
Shipping Bills’ Forgery: Madras HC Says Informant Cannot Appeal Before Tribunal Without Being a Party to Proceedings
T.A.M.Athavan vs The Commissioner of Customs CITATION : 2025 TAXSCAN (HC) 1003
The Madras High Court dismissed a writ petition challenging the dismissal of his appeal before the Customs, Excise, and Service Tax Appellate Tribunal ( CESTAT ). It ruled that a person who is not a party to the original customs proceedings has no legal standing (locus standi) to file an appeal before the Tribunal.
The bench upheld the observation of the tribunal that “merely because investigation was initiated based on the complaint given by the petitioner, it cannot be said that the petitioner is a person aggrieved by the order of the Original Authority. By giving the aforesaid findings, the Appellate Tribunal has held that the appellant has got no locus standi to file the appeal.”
The Court also noted that no adverse order had been passed against the petitioner in the original proceedings and that the Customs Act is concerned with violations of statutory provisions, not personal rivalries.
Once AAR Ruling is Upheld by Courts, Dept Cannot Reopen Classification Dispute via Review Petition: Madras HC
The Commissioner of Customs vs M/s Isha Exim CITATION : 2025 TAXSCAN (HC) 1004
In a recent decision, the Madras High Court dismissed review petitions filed by the Commissioner of Customs, ruling that once an Advance Ruling (AAR) has been upheld by courts, the classification dispute cannot be reopened by the department through a review petition.
The Bench comprising Justice J. Nisha Banu and Justice R. Kalaimathi held that there was no error apparent on the face of the record to justify review. The court observed that the department was attempting to reargue what had already been thoroughly decided. It further held that a review petition could not be used as an appeal in disguise and that the settled classification issue could not be reopened after being upheld by multiple judicial forums, including the Supreme Court.
Relief for Sahara Asset: Madras HC Upholds ITAT Order Allowing Mutual Fund Promotion Expenses as Commercially Justified
Commissioner of Income Tax vs Sahara Asset ManagementCompany Pvt. Ltd CITATION : 2025 TAXSCAN (HC) 1005
The High Court of Madras, upheld the ITAT’s order allowing Sahara Asset Management Company Pvt. Ltd. to claim mutual fund promotion and Initial Public Offering (IPO) related expenses as commercially justified business expenditure.
The Division Bench of Chief Justice K.R.Shriram and Justice Sunder Mohan, accordingly concluded that the expenditure incurred and debts recoverable from MMC were eligible for deduction under Section 28 of the Act. It answered the substantial question of law in the affirmative and dismissed the appeal of the income tax department.
Plea for Provisional Release of Goods: Madras HC Orders Customs to Decide Representation Based on SC's Navshakti Industries Ruling
M/s. HI Rexine vs The Deputy Director CITATION : 2025 TAXSCAN (HC) 1006
The Madras High Court has directed the Customs Department to consider the representation of provisional release of goods under Section 110A of the Customs Act, 1962 based on the Supreme Court judgment in Navshakti Industries.
Without going into the merits of the petitioner’s claim, the Court stated that it is the responsibility of the authorities to assess the matter in accordance with law, considering the precedents. The Court, therefore, directed the petitioner to submit a fresh representation within one week, clearly seeking provisional release of the goods.
Moisture and Ash Content Not Tested Properly for Areca Nuts’ Raw or Roasted Classification: Madras HC Remands Matter to Customs Commissioner
M/s.Shahnaz Commodities International Pvt vs The Chairman,Central Board of Indirect Taxes & Customs CITATION : 2025 TAXSCAN (HC) 1007
The Madurai bench of Madras High Court has remanded the matter involving the import of areca nuts back to the Customs Commissioner for fresh consideration. The Court found serious lapses in the testing procedures and methodology adopted to determine whether the imported areca nuts were in raw or roasted form, an important issue for tariff classification and the applicable customs duty.
Justice Vivek Kumar Singh observed that such a vague and unsubstantiated conclusion could not form a legally sustainable basis for reclassification. The Court also noted that the test was conducted in a non-NABL (National Accreditation Board for Testing and Calibration Laboratories) accredited laboratory, further weakening the evidentiary value of the report.
Pension Account Attached for Income Tax Dues: Madras HC Allows Withdrawal Citing S.11 of TN Pension Act
S.Devarajan vs Union of India CITATION : 2025 TAXSCAN (HC) 1008
The High Court of Madras, allowed monthly withdrawal of ₹48,000 from a pension account attached for tax recovery, citing protection under Section 11 of the Tamil Nadu Pension Act, 1871.
Considering the pending appeal, the age of the transaction (2013), and the protection under the Pension Act, the Court allowed the petitioner to withdraw up to ₹48,000 per month from his pension account. It also permitted withdrawal of the pension amount accumulated after the date of attachment, upon verification by the bank. The attachment would otherwise continue until the appeal was decided.
The bench directed the appellate authority to dispose of the appeal filed on 07.01.2023 at the earliest and disposed of the writ petition.
Order passed by MSERC Amenable to Appeal u/s. 111 of Electricity Act as No Natural Justice Violation or Jurisdictional Error Found: Meghalaya HC
Byrnihat Industries Association vs Meghalaya StateElectricity Regulatory Commission CITATION : 2025 TAXSCAN (HC) 1009
In a recent ruling passed by the High Court of Meghalaya in the month of June, it was held that the order passed by the Meghalaya State Electricity Regulatory Commission (MSERC) is amenable to an appeal under Section 111 of the Electricity Act, 2003, as there is no breach of the principles of natural justice, lack of jurisdiction, or any patent illegality apparent on the face of the order.
The bench, by going through the impugned order, noted that there were no exceptional circumstances such as a breach of natural justice, lack of jurisdiction, or clear illegality. If the above factors were present, the appeal remedy under Section 111 of the Electricity Act would be ineffective.
The High Court held that the impugned order can be challenged through an appeal under Section 111 of the Electricity Act, 2003.
Madras HC Allows Customs Duty Exemption on STP Imports Despite CMDA Approval Granted Post-Import
M/s.KhivrajTech Park Pvt. Ltd. vs Union of India CITATION : 2025 TAXSCAN (HC) 1010
In a recent decision, the Madras High Court held that Khivraj Tech Park Pvt. Ltd. was entitled to customs duty exemption on imported capital goods for setting up a Software Technology Park (STP), even though approval from the Chennai Metropolitan Development Authority (CMDA) was received after the date of import. The court ruled that procedural delays by authorities should not deprive the company of benefits it was otherwise eligible for.
The court applied the doctrine of substantial compliance and emphasized that the purpose of the exemption notification was to promote exports. It stated that technical delays or procedural lapses not attributable to the importer should not lead to the denial of substantive benefits.
The court allowed the writ appeal, quashed the earlier order rejecting the exemption, and directed that the company was entitled to customs duty exemption. The court also held that the bank guarantee furnished by the appellant must be returned.
Orissa HC Sets aside Order passed by NFAC without allowing 7 days Time Stipulated u/s 144B of Income Tax Act
Ramshankar Mahapatra vs Central Board of Direct Taxes(CBDT) CITATION : 2025 TAXSCAN (HC) 1011
The Orissa High Court set aside the order passed by the National Faceless Assessment Centre (NFAC) as it was without allowing the 7 day time stipulated under section 144B of the Income Tax Act, 1961.
The bench comprising Chief Justice Mr. Harish Tandon and Justice Mr. Murahari Sri Raman while diligently considering the material available on record, perceives that inadequate time was granted to the petitioner to furnish voluminous documents. The Court is inclined to set aside the Assessment Order dated 11.03.2025 passed under Section 147 read with Section 144B of the Income Tax Act and remit the matter to the opposite party no.4- The Assessment Unit, Income Tax Department, The National Faceless Assessment Centre for fresh adjudication of the matter with respect to financial year 2016-17 relevant to assessment year 2017-18.
Delhi HC upholds Conviction u/s 276 C(2) of Income Tax Act citing, Nonpayment of Income Tax Returns was wilful act of accused
HARISH CHADHA vs STATE CITATION : 2025 TAXSCAN (HC) 1012
In a recent case, the Delhi High Court has observed that merely claiming financial inability, without providing any further explanation or evidence, holds no weight and is clearly untenable. The bench upheld the Conviction under section 276 C(2) of the Income Tax Act, 1961 holding that nonpayment of Income Tax Returns was a wilful act of the accused
A single bench of Justice Neena Bansal Krishna concluded that there are contradictory claims being made by the Petitioner, which do not explain the exact nature of transactions and therefore, it was a case of disputed business transactions, which needed evidence to be established and proved. Such transactions cannot be covered under the words "any person who holds the money as referred to under Section 226 of the Income Tax Act. '
Big Relief to Exporters: Gujarat HC Declares Omission of Rule 96(10) Retrospective, Orders Processing of Pending IGST Refund Claims
MESSRS ADDWRAP PACKAGING PVT. LTD. & ANR vs UNION OFINDIA & ORS CITATION : 2025 TAXSCAN (HC) 1013
In a landmark judgment, the Gujarat High Court held that the omission of Rule 96(10) of the Central Goods and Services Tax (CGST) Rules through Notification No. 20/2024 dated 08.10.2024 will apply retrospectively to all pending proceedings. The Court directed that exporters who had paid IGST on exports, but were earlier denied refunds due to the now-omitted Rule 96(10), must have their refund claims processed without delay.
The bench, led by Justice Bhargav D. Karia and Justice D.N. Ray, rejected this reasoning and observed that no actual double benefit occurred, especially where exporters paid IGST and complied with filing obligations. The court held that Rule 96(10) was ultra vires the parent legislation and disproportionately penalized compliant exporters.
The court explained that procedural rules cannot override substantive rights granted by the statute. It further observed that recovery proceedings based on the disallowed refunds were legally unsustainable.
Delayed TDS Payment: Jharkhand HC quashes Proceedings initiated under Income Tax Act considering Payment of tax with interest
M/s SKS MC Joint Venture vs The State of Jharkhand CITATION : 2025 TAXSCAN (HC) 1014
The High Court of Jharkhand has quashed the order passed by the Special Judge, Economic Offences, Ranchi in Economic Offence on finding that the continuation of the criminal proceeding against the petitioners will amount to abuse of process of law. It was found that the amount has been deposited with stipulated interest before filing of the complaint defaulted amount with stipulated interest thereon.
The bench found that Section 279 (2) of the Income Tax Act, 1961 in no uncertain manner, vests the power upon the Principal Chief Commissioner or Chief Commissioner or a Principal Director General or a Director power of compounding the offence upon the senior officers of the Income Tax Department, as already indicated above in this judgment, is that in case the defaulting person deposits the amount before institution of the complaint, the offence is required to be compounded; instead of instituting a complaint and thereby harassing the person who has deposited the amount with stipulated interest before filing of the complaint and wasting the precious time of the courts as well as the officers concerned of the Income Tax Department.
Can Businesses Get Cash Refunds for Transitional CENVAT Credit Reversals? Supreme Court to Decide
TENORMACENTERPRISES PVT. LTD. vs THE COMMISSIONER OF CGST AND CENTRAL EXCISE CITATION : 2025 TAXSCAN (SC) 186
The Supreme Court of India is set to examine whether the reversed transitional CENVAT credit, which was previously carried forward under GST, can be refunded in cash, following an appeal filed by Tenormac Enterprises.
The bench comprising Justices Ujjal Bhuyan and Manmohan held that, prima facie, the High Court could not have granted a stay after holding that it lacked jurisdiction and disposing of the matter as not pressed. The court issued notice to the revenue and stayed the High Court’s order of 12 June 2025. It clarified that the revenue remains free to file an appeal under Section 35-L, which would be considered on its own merits.
Delhi HC Quashes Reassessment Proceedings Initiated as Notice issued in name of Deceased Assessee
LAXMI DEVI(SINCE DECEASED) THROUGH LEGAL HEIR NARENDRA MANN vs ASSISTANT COMMISSIONERINCOME TAX DEPARTMENT CITATION : 2025 TAXSCAN (HC) 1015
The Delhi High Court quashed the reassessment proceedings initiated as notice issued in name of deceased assessee. Since the notice issued under Section 148 of the Act was invalid as it was issued in the name of the deceased Assessee, the proceedings commenced pursuant thereto must fail.
It was further observed that the issuance of a notice under Section 148 of the Act is at the root of the jurisdiction of an AO to commence proceedings. Absent any such valid notice, the AO cannot assume jurisdiction for reopening the assessment.
Since the notice issued under Section 148 of the Act was invalid as it was issued in the name of the deceased Assessee, the proceedings commenced pursuant thereto must fail and the court set aside the impugned assessment order and the impugned notices.
Plea Against Constitutional Validity of GST S.16(2) Rejected: Karnataka HC Directs to Pursue Statutory Appeal Against Demand Order
R.S.ENTERPRISES vs THE ASSISTANT COMMISSIONER OF COMMERCIAL TAXES CITATION : 2025 TAXSCAN (HC) 1016
The High Court of Karnataka, dismissed a petition challenging the constitutional validity of Section 16(2) of the Central Goods and Service Tax/ State Goods and Service Tax (CGST/SGST) Act, 2017, citing the availability of an alternate remedy under Section 107 of the Karnataka Goods and Services Tax (KGST) Act.
However, the Court held that an appeal could be filed before the appellate authority within three months of the order, as clearly provided in the law. Since the issue was already decided by a Coordinate Bench, the Court declined to go into the merits.
The petition was dismissed, with liberty to the petitioner to file an appeal. The bench also directed that the time spent in this proceeding be condoned if the petitioner approached the appellate authority.
Relief for Kaarya Facilities: Bombay HC Clarifies 'Tax Quantification' Standard Under SVLDRS Scheme
KaaryaFacilities & Services Ltd vs Union of India CITATION : 2025 TAXSCAN (HC) 1017
In a recent ruling, the Bombay High Court ruled in favour of Kaarya Facilities & Services Ltd., holding that the GST department wrongly denied the company benefits under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 (SVLDRS), by misinterpreting what constitutes "quantification" of tax dues.
The bench, led by Justices M.S. Sonak and Jitendra Jain, observed that the delay was not unreasonable, especially given the impact of the COVID-19 pandemic. It further observed that the CBIC circular and FAQs made it clear that a written admission of tax liability during an investigation qualifies as quantification under the scheme.
No Jurisdictional Error Found in GST Order: Madras HC directs to Re-file GST Appeal Within 15 Days
M/s. VihaHotels Private Limited vs The Assistant Commissioner of GST and Central Excise CITATION : 2025 TAXSCAN (HC) 1018
The Madras High Court has dismissed a writ petition challenging a GST ( Goods and Services Tax ) demand order, while granting liberty to the petitioner to re-file a statutory appeal within 15 days observing that there is no jurisdictional error.
The Court clarified that it was not concerned with the correctness of the decision but rather with the legality of the decision-making process, and found no procedural infirmity warranting its interference under Article 226 of the Constitution.
The petitioner stated throughout the proceedings that an appeal had previously been filed but had since been withdrawn. The Court acknowledged that the appeal could be maintained and allowed the petitioner to resubmit the statutory appeal to the Appellate Authority within 15 days after receiving the order, as long as they complied with all GST law procedural requirements.
AAR’s Classification of Inox Installation Plant as Immovable Property Lacks Reasoning: Madras HC Remands Matter
Inox AirProducts Private Limited vs Union of India CITATION : 2025 TAXSCAN (HC) 1019
In a recent ruling, the Madras High Court remanded a case back to the Appellate Authority for Advance Ruling (AAAR), Tamil Nadu, after finding that the authority had failed to provide sufficient reasoning for classifying a plant installation by Inox Air Products Private Limited as immovable property and denying Input Tax Credit (ITC).
A single bench led by Justice Mohammed Shaffiq held that the AAAR’s failure to deal with the second issue required a reconsideration. The court allowed the petitioner to file additional submissions and directed the AAAR to pass a fresh order within six months, after granting an opportunity for a hearing.
Buyer’s TDS Filing Error Won’t Deny NRI Seller's Full Credit: Delhi HC Orders Refund Processing
PARAG KESHAVBOPARDIKAR vs INCOME TAX OFFICER & ORS CITATION : 2025 TAXSCAN (HC) 1020
In a recent ruling, the Delhi High Court directed the Income Tax Department to grant full TDS credit to an NRI seller and process a refund, despite a mistake by the property buyer in filing the TDS under the wrong form.
A division bench led by Justice Vibhu Bakhru and Justice Tejas Karia held that the denial of credit due to a mere form-related error was unjust. The court found that there was no legal provision allowing the Assessing Officer to withdraw a valid assessment order and issue a revised computation without due process. It further ruled that requiring the buyer’s consent was unnecessary, as the TDS was not in dispute.’
SVLDRS Benefits Not Available for Voluntary Disclosure When Tax is Admitted in Filed Returns: Madras HC
Taufiq ManpowerConsultants Private Limited vs The Assistant Commissioner of GST and CentralExcise CITATION : 2025 TAXSCAN (HC) 1021
In a recent ruling, the Madras High Court held that benefits under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 (SVLDRS) are not available for voluntary disclosure when the taxpayer has already filed returns admitting the tax liability.
The bench presided over by Justice C. Saravanan observed that the petitioner deliberately reduced the admitted tax liability while filing the declaration under SVLDRS and misrepresented the amount as if it fell under the “arrears” category. The court explained that once a return has been filed admitting tax due, the benefit of voluntary disclosure is not available under the scheme.
Gauhati HC Grants CST Section 6(2) Benefit Despite Non-Furnishing of ‘C’ Forms, Citing Uncontested Inter-State Movement of Goods
M/S BharatTrading Corporation vs State of Assam CITATION : 2025 TAXSCAN (HC) 1022
The Gauhati High Court held that the benefit under Section 6(2) of the Central Sales Tax (CST) Act, 1956, cannot be denied merely due to the non-furnishing of ‘C’ Forms, especially when the inter-State movement of goods by the petitioner is not disputed.
The high court, by relying on the decision of the Bombay High Court in the case of M/S. Prism Cement Limited and Another vs. State of Maharashtra and Others, Writ Petition No. 6475 of 2009, held that “even after the amendment of Section 8(5) by the Finance Act, 2002, the State Government in public interest may, subject to the fulfilment of the requirements of Section 8(4), applicable to the transactions covered under Section 8(1), grant total/partial exemption from tax payable on inter-State sales covered under Section 8(1) as also under Section 8(2) of the CST Act.”
Himachal Pradesh HC Allows Benefit u/s 80-IC of Income Tax Act @ 100% of profit relying on Supreme Court Judgement
M/s J.C.International vs Deputy Commissioner of Income Tax. CITATION : 2025 TAXSCAN (HC) 1023
Relying on the Supreme Court judgment in Principal Commissioner of Income Tax, Shimla vs. Aarham Softronics (2019), the Himachal Pradesh High Court has held that an assessee who sets up a new industry of a kind mentioned in Section 80-IC(2) of the Income Tax Act and starts availing exemption of 100% tax under Section 80-IC(3) (which is admissible for five years) can start claiming exemption at the same rate of 100% beyond the period of five years.
In this case, the Supreme Court has clearly held that “An undertaking or an enterprise which had set up a new unit between 7th January, 2003 and 1st April, 2012 in State of Himachal Pradesh of the nature mentioned in clause (ii) of sub-section (2) of Section 80-IC, would be entitled to deduction at the rate of 100% of the profits and gains for five assessment years commencing with the ‘initial assessment year’. For the next five years, the admissible deduction would be 25% (or 30% where the assessee is a company) of the profits and gains.”
Customs Rejects IOCL’s 104 Shipping Bill Conversion Relying on Circular Declared Ultra Vires by HC: Madras HC directs Reconsideration
TheCommissioner of Customs (Preventive) vs Indian Oil Corporation Ltd CITATION : 2025 TAXSCAN (HC) 1024
The Madras High Court has directed the Customs Department to reconsider Indian Oil Corporation Ltd's ( IOCL ) request for conversion of 104 free shipping bills to drawback shipping bills, which was rejected by a circular which was declared ultra vires by the Gujarat HC.
The Bench comprising Chief Justice K.R. Shriram and Justice Mohammed Shaffiq observed “Since the Gujarat High Court has held that the impugned circular to the extent of paragraph 3(a) is ultra vires Articles 14 and 19(1)(g) of the Constitution of India, as also ultra vires Section 149 of the Customs Act, 1962, the question of the Commissioner or the Original Authority relying on the said provision in the circular does not arise.”
Win for Deloitte: Madras HC Rules Firms and HUFs Cannot Be Partners in a Firm, Quashes PCIT Order Disallowing Partner Remuneration
M/s.DeloitteHaskins & Sells vs The Assistant Commissioner of Income tax CITATION : 2025 TAXSCAN (HC) 1025
In a recent decision, the Madras High Court quashed the Principal Commissioner of Income Tax’s (PCIT) order against Deloitte Haskins & Sells, ruling that only individuals and not firms or Hindu Undivided Families (HUFs) can be partners in a partnership firm. The court also ruled that the Rs. 3.23 crore remuneration paid to Deloitte’s partners was valid and could not be disallowed.
The court further observed that since the firm and its partners together paid the correct amount of tax, there was no financial disadvantage to the government. It held that the PCIT had no valid basis to revise the original assessment order.
Accordingly, the court allowed Deloitte’s appeal and dismissed the Revenue’s appeal. It held that the PCIT’s revision order under Section 263 was unjustified and should be set aside.
SARFAESI and RDB Act Prevail Over TN General Sales Tax Act in Public Interest: Madras HC Grants Relief to Indian Bank
Indian Bank vsThe Commercial Tax Officer CITATION : 2025 TAXSCAN (HC) 1026
In a recent ruling, the Madras High Court has held that the provisions of the SARFAESI Act and the Recovery of Debts and Bankruptcy Act ( RDB Act ) would prevail over the Tamil Nadu General Sales Tax Act ( TNGST Act ), granting relief to Indian Bank in a dispute concerning priority of claims over secured assets.
The Court noted that the bank’s lease arrangement was genuine, had continued without interruption since 1992, and was part of a legitimate effort to adjust dues under the overdraft facility. The property had since been auctioned under SARFAESI proceedings, with proceeds appropriated to settle the loan account.
Former Kerala Finance Minister Charged with Defamation: Sikkim HC Refuses to Quash Summons, Petition Dismissed
Dr. T. M.Thomas Issac vs Santiago Martin CITATION : 2025 TAXSCAN (HC) 1027
The Sikkim High Court has dismissed a plea by the former Kerala Finance Minister seeking to quash criminal defamation summons issued against him in connection with a controversial press statement made after a GST Council meeting held on December 19, 2019.
The court observed that “Pertinently, it may be remarked that the judicial system in our country is an adversarial system and not inquisitorial, where the Magistrate would be expected to be actively involved in investigating into the matter personally for arriving at the truth. Under the present legal system followed, it suffices that the Magistrate has taken steps for examining the witnesses as held in Vijay Dhanuka (supra). Consequently, this argument advanced by Learned Senior Counsel for the Petitioner also cannot be countenanced.”
GST Dept Counsel Admits No Personal Hearing Granted before Passing Order: Madras HC remands Matter on Pr-edposit Requirement
M/S QualitySurgical Stores vs The Deputy State Tax officer 1 CITATION : 2025 TAXSCAN (HC) 1028
The Madras High Court has quashed a GST assessment order that was passed without granting the petitioner an opportunity for a personal hearing. Notably, the counsel for the GST department herself conceded before the Court that no such hearing had been provided, in clear contravention of the mandatory requirement under Section 75(4) of the CGST Act.
Considering the submissions, Justice Krishnan Ramasamy observed that the impugned assessment order had been passed in clear violation of the statutory mandate under Section 75(4) of the GST Act and the principles of natural justice.
Accordingly, the Court set aside the order dated 30.08.2024 and remanded the matter to the respondent authority for fresh consideration. The Court directed the petitioner to pay 25% of the disputed tax amount, after adjusting the sum already recovered, within a period of four weeks.
GST Rectification Application Rejected Stating ‘No errors apparent on the face of the record’: Madras HC sets aside Rejection Order
KR Agencies vsThe State Tax Officer (ST) CITATION : 2025 TAXSCAN (HC) 1029
In a recent ruling, the Madurai bench of Madras High Court quashed an order rejecting a GST ( Goods and Services Tax) rectification application on the ground that the petitioner was denied a hearing, violating the principles of natural justice.
Accordingly, the Court set aside the rejection order and remanded the matter back to the concerned GST authority. It directed the authority to pass a fresh order under Section 161 of the GST Act after providing the petitioner an opportunity for personal hearing. The entire direction is to be completed within three months from the date of receipt of the order, said the bench.
Duplication of GST Proceedings on Same Matter: Kerala HC Quashes Rejection of Rectification Request Filed by Mail
M/S. WINTERWOOD DESIGNERS & CONTRACTORS INDIA PVT. LTD vs THE STATE TAX OFFICER WORKSCONTRACT CITATION : 2025 TAXSCAN (HC) 1030
In a significant ruling, the Kerala High Court has quashed an order-in-original issued against an already adjudicated issue and the rejection of a rectification request under Section 161 of the Goods and Services Tax (GST) Act, observing that the error in question was “apparent on the face of record” and should have been rectified regardless of the manner of submission.
Justice Ziyad Rahman A.A., delivering the judgment, held that the rejection was unsustainable. “When such a serious error was clearly pointed out before the competent authority, within the statutory period, such authority could not have refrained from invoking the powers of rectification,” the Court observed.
Merely Being a Subsidiary Does Not Qualify as 'Agent' under GST: Bombay HC Criticizes Dept for Relying on Unrelated Definitions
Sundyne Pumpsand Compressors India Pvt Ltd vs The Union of India CITATION : 2025 TAXSCAN (HC) 1031
In a recent decision, the Bombay High Court ruled that a wholly owned Indian subsidiary providing services to its foreign parent company does not automatically become an “agent” under Section 2(5) of the CGST Act, 2017. The court held that merely being a subsidiary is not enough to deny the benefits of “export of services,” and it criticized the GST department for relying on definitions of “agent” from unrelated sources to reject refund claims.
The bench of Justices B.P. Colabawalla and Firdosh P. Pooniwalla observed that there was no material to suggest that the petitioner acted on behalf of the foreign entity. The agreement between the parties made it clear that the relationship was that of an independent contractor and a client. The court observed that the revenue had relied on definitions from other laws that were not applicable, despite the GST law having its own specific definition of “agent” under Section 2(5).
Relief to Retired Central Excise Officer: Madras HC Bars Dept from Acting on Caste Certificate Allegations
M.Karuppanan vs The Tamil Nadu State Level Scrutiny Committee CITATION : 2025 TAXSCAN (HC) 1032
The Madurai Bench of the Madras High Court recently granted relief to a retired Central Excise officer by quashing an order that the community doubt on the validity of his caste certificate from 1977, even though it was initially evident that the petitioner belonged to the backward class rather than the ST Community.
The Madurai Bench of the Madras High Court recently granted relief to a retired Central Excise officer by quashing an order that the community doubted the validity of his caste certificate from 1977, even though it was initially evident that the petitioner belonged to the backward class rather than the ST Community.
Reply to SCN Must Be Uploaded On GST Portal or Filed Physically: Madras HC
M/s.ShreeBalaji Enterprises vs Joint Commissioner of GST & Central Excise CITATION : 2025 TAXSCAN (HC) 1033
After remanding the case to the GST department, the Madras High Court instructed the assessee to submit the response either in person or via the Goods and Services Tax (GST) portal. The reply was not considered by the officer before passing the order as it was not uploaded through the portal.
Justice Krishnan Ramasamy observed that the impugned order was passed without granting the petitioner any opportunity of personal hearing, in clear violation of the principles of natural justice. It was also admitted by the department that the email reply was not considered due to non-submission via the official GST portal.
Support our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates
