No Tax Liability arises from Pre-GST Lease Deed: Allahabad HC Stays GST Proceedings [Read Order]
Counsel for the petitioner submitted that since the lease deed was executed before the enforcement of the GST regime, it could not be subjected to GST liability
Tax Liability - Pre-GST - Lease Deed - Allahabad HC - taxscan
Tax Liability - Pre-GST - Lease Deed - Allahabad HC - taxscan
The Allahabad High Court, in a recent order, granted an interim stay on further proceedings initiated under the GST regime observing that the lease agreement in question predated the enforcement of the Uttar Pradesh Goods and Services Tax Act, 2017 (UPGST Act).
The Division Bench comprising Justice Saumitra Dayal Singh and Justice Indrajeet Shukla passed the order in Writ Tax No. 4870 of 2025, following a reference to a similar issue pending before the Court in Srigarv Infratech Pvt. Ltd. v. State of UP.
The petitioner, Viable Venture Pvt. Ltd., represented by advocates Sri Shaubhik Gupta and Sri Shivang, challenged a notice dated 04.03.2025 issued by the State GSTauthorities, contending that no tax liability could arise from a lease deed executed on 07.06.2017 - prior to the coming into force of the UPGST Act, 2017.
The petitioner relied on the earlier case of Srigarv Infratech Pvt. Ltd., where the High Court had entertained a similar plea questioning retrospective application of GST on pre-GST transactions.
Counsel for the petitioner submitted that since the lease deed was executed before the enforcement of the GST regime, it could not be subjected to GST liability. The State’s Additional Chief Standing Counsel, Sri Nimai Das, appearing for the respondents, sought time to file a counter affidavit.
The Bench noted that the issue raised was already under consideration in Srigarv Infratech Pvt. Ltd. and directed that the present petition be listed along with that case. Granting the State four weeks to file its counter affidavit and the petitioner two weeks thereafter to file a rejoinder, the Court ordered that further proceedings pursuant to the impugned notice dated 04.03.2025 shall remain stayed until further orders.
With this interim relief, the Allahabad High Court provided temporary protection to Viable Venture Pvt. Ltd. from any coercive action under GST based on a pre-GST lease transaction, signaling the judiciary’s continued scrutiny of retrospective tax implications under the new regime.
It was stated that, “5. List thereafter alongwith Writ Tax No.1565 of 2025. 6. For the reason contained in the aforesaid writ tax, further proceedings to the notice dated 04.03.2025 shall remain stayed.”
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