Supreme Court & High Courts Weekly Round-up [June 8th to June 14th, 2025]

This weekly round-up analytically summarizes the key stories related to the Supreme Court and High Court reported at Taxscan.in during the previous week from June 8th, 2025 to June 14th, 2025.

Supreme Court Halts ₹317.5 Crore VAT Recovery Against Antrix Over Satellite Transponder Lease

ANTRIXCORPORATION LIMITED vs THE ASSISTANT COMMISSIONER OF COMMERCIALTAXES(ENFORCEMENT) & ORS. CITATION : 2025 TAXSCAN (SC) 184

The Supreme Court of India stayed a Rs. 317.5 crore VAT demand raised by the Karnataka Commercial Taxes Department against Antrix Corporation Ltd., the commercial arm of ISRO, in a dispute concerning the tax treatment of satellite transponder lease charges.

The bench comprising Justices Prashant Kumar Mishra and Manmohan stayed the June 2025 recovery notice and took the Karnataka government’s endorsement on record. The court observed that the matter was already pending and under its consideration. It issued notice on Antrix’s interlocutory application and listed the appeals for hearing in the second week of August.

The court’s interim order provides temporary relief to Antrix while keeping open the larger question of whether leasing satellite transponder capacity constitutes a service or a sale under VAT law. The outcome is expected to have huge implications for the taxation of satellite-based services and the balance between central and state tax regimes.

Orissa Quarry Tender Dispute: Supreme Court holds Valid Income Tax Return and GST Certificate Sufficient to Qualify as Bidder

M/S SriVenkateswara Constructions vs State of Odisha & Ors. CITATION : 2025 TAXSCAN (SC) 185

The Supreme Court of India recently set aside an order of the Orissa High Court where it called for a re-tender in respect of the Karangadihi Sand Quarry. The division bench of the apex court held that the submission of a valid Income Tax Return and GST clearance certificate was sufficient compliance for bidder qualification under the tender conditions.

It was affirmed that the certificate from the GST authority sufficiently indicated compliance, despite carrying standard caveats. The apex court found no illegality in the process adopted by the revenue authorities, and observed that the appellant’s bid was substantially higher, which could have benefited the State exchequer.

The respondent, on the other hand, failed to submit an official GST no-dues certificate and merely provided a GST portal screenshot, which did not satisfy the tender conditions

Delhi High Court Upholds ITAT Order: Dismisses Revenue's Appeal Against DCF-Based Valuation of Unquoted Shares

PRINCIPAL CHIEF COMMISSIONER vs A.H. MULTISOFT PVT. LTD. CITATION : 2025 TAXSCAN (HC) 959

The Delhi High Court upheld the Income Tax Appellate Tribunal (ITAT)’s order and dismissed the revenue’s appeal against the discounted cash flow (DCF) method-based valuation of unquoted shares.

The Delhi High Court observed that the Assessing Officer (AO) had already calculated the share value under Rule 11UA and found it to be negative. So, even if we go by the AO’s calculation, since the Assessee’s valuation is higher and backed by evidence, it should be accepted.

The bench noted that the assessee had valued the unquoted equity shares held by the assessee in SAFL by the DCF method and that the same was permissible under Rule 11UA(2) of the Rules.

Delay in GST Appeal Filing: Madras HC allows to File appeal Physically as Registration Cancelled

M/s.Thirumalai Balaji Constructions vs The DeputyCommissioner (ST) CITATION : 2025 TAXSCAN (HC) 960

The Madras High Court has permitted physical filing of time-barred Goods and Services Tax ( GST ) appeal on 25% pre-deposit as the registration was cancelled.

Justice C. Saravanan observed, while granting liberty to file appeal on pre-deposit observed that “Although the Hon’ble Supreme Court has held that there is no scope of entertaining the Writ Petition after the expiry of the limitation, this Court has taken consistent stand to allow the petitioner under the similar circumstances to file an appeal, subject to pre-deposit of 25% of the disputed tax. This stand has not been deviated and has been followed regularly.”

The court observed that since the petitioner’s GST registration had already been cancelled, electronic filing of appeal was not possible through the common portal. Recognizing this practical impediment, the Court allowed the petitioner to file physical appeals before the Appellate Commissioner.

GST Demand raised on Non-Reflection of Credit Note Values and its ITC Reversal in GSTR 2A: Madras HC grants Liberty to File Late GST Appeal with 15% Pre-Deposit

M/s.Tuskers Associate vs The State Tax Officer CITATION : 2025 TAXSCAN (HC) 961

The Madras High Court has granted liberty to file a time-barred appeal against a GST ( Goods and Services Tax ) assessment order, provided they make a 15% pre-deposit of the disputed tax amount.

Justice Krishnan Ramasamy held that while the assessment proceedings were conducted with due process, the petitioner’s willingness to comply financially warranted a pragmatic solution. Accordingly, the Court dismissed the writ petition but granted liberty to the petitioner to file an appeal within 30 days from receipt of the order, on the condition of depositing 15% of the disputed tax. The Court directed the appellate authority to entertain the appeal on merits, without insisting on limitation.

Pledge Shares to Support Sister Concern’s Loan is Business Activity: Madras HC Backs Writing off of ₹8.46 Crore Bad Debt

Commissioner of Income Tax vs M/s.Star Investments Pvt.Ltd CITATION : 2025 TAXSCAN (HC) 962

The Madras High Court has upheld the write-off of ₹8.46 crore as a valid business loss ruling that pledging shares to secure a loan for a sister concern was a legitimate business activity.

The bench observed that “As regards the submission of the Revenue that the pledging of shares of BDL by assessee to ICICI is not in the course of business activity, the fact is, assessee was a promoter of BICL. The shares were pledged, so as to enable the sister concern/group company to avail the loan from ICICI. Therefore, certainly, it has to be in the course of business.”

Denial of Tax Payment in Installments: Gauhati HC stays Coercive Steps against Petitioner before Disposal of Representation

Smti Gichak Daniam vs The Union of India and 2 Ors CITATION : 2025 TAXSCAN (HC) 963

The Gauhati High Court has granted short-term relief to a GST-registered trader, telling tax officials not to resort to “coercive action” until they pass a reasoned order on the request to clear arrears in instalments.

“The respondents shall dispose of the representation dated 26-05-2025 within three weeks, keeping in mind Section 80 and the petitioner’s financial liability,” the court ordered, adding that no coercive step may be taken in the meantime. The petitioner must serve a certified copy of the order to the department within seven days to trigger the timeline.

GST DRC-01 cannot be Substitute to Show Cause Notice Issued u/s 73 (1) of CGST Act : Gauhati HC

AMAN GUPTA vs THE UNION OF INDIA AND ORS CITATION : 2025 TAXSCAN (HC) 964

The Gauhati High Court has held that a summary of the Show Cause Notice in GST DRC-01 is not a substitute to the Show Cause Notice to be issued in terms of Section 73 (1) of the CGST Act as well as the SGST Act.

The bench of Justice Arun Dev Choudhury has relied on the decision in the case of Construction Catalysers Pvt. Ltd. Vs. the State of Assam in which it was held that the Summary of the Show Cause Notice, the Summary of the Statement under Section 73 (3) and the Summary of the Order passed in terms with Section 73 (9) are to be issued in GST DRC-01, GST DCR-02 and GST DRC-07 respectively.

Delhi HC upholds Income Addition deleted by CIT(A) based on True Disclosure by Asseessee

PR. COMMISSIONER OF INCOME TAX vs M/S K.R. PULP AND PAPERSLTD CITATION : 2025 TAXSCAN (HC) 965

In a recent case, the Delhi High Court upheld the income addition deleted by CIT(A) based on true disclosure by assessee. It was found that there was no failure on the part of the Assessee in disclosing fully and truly all material facts necessary for completion of the assessment.

A division bench of Justice Vibhu Bakhru and Justice Tejas Karia observed that the reasons recorded by the AO did not specify the names of any particular share applicants, the details of the cheques or the amount paid. It is also necessary to note that issue of share capital, and the details of various share holders had already been examined during the assessment proceedings. Therefore, the AO was required to have some additional information, beyond what had already been examined, in order to form reasons to believe that the Assessee‘s income had escaped assessment.

Delhi HC Quashes Reassessment Notice Issued on failure to follow Procedure as prescribed u/S 148A of Income Tax Act

CHANDRAPRAKASHSRIVASTAVA vs INCOMETAXOFFICER CITATION : 2025 TAXSCAN (HC) 966

The Delhi High Court quashed the reassessment notice issued on failure to follow the procedure as prescribed under section 148A of the Income Tax Act, 1961.

A division bench of Justice Vibhu Bakhru and Justice Tejas Karia set aside the impugned notice and the proceedings. As the revenue made a concession in the decisionthat described above is for the assessment year 2015-2016, all notices issued on or after 1st April, 2021 will have to be dropped as they would not fall for completion during the period prescribed under the taxation and other laws (Relaxation and Amendment of certain Provisions Act, 2020). Nothing further is required to be adjudicated in this matter as the notices so far as the present litigation is concerned is dated 25.6.2021.

SCN Issued on Email Address Mentioned in MCA Website: Delhi HC Upholds Penalty Proceedings Initiated u/s 270 A of Income Tax Act

KALKAJEE KRAFT PAPER PRIVATE LIMITED vs ASSESSMENT UNIT CITATION : 2025 TAXSCAN (HC) 967

The Delhi High Court upheld the penalty proceedings initiated under section 270A of the Income Tax Act, 1961 as the show cause notice (SCN) was issued to the email address mentioned on the MCA website.

A division bench of Justice Vibhu Bakhru and Justice Tejas Karia accepted that the impugned order has been passed in violation of principles of natural justice on the ground that the petitioners have not been afforded a sufficient opportunity to represent its case. There is also no dispute that the notices have been duly put up on the ITBA Portal and the petitioner was aware of the assessment proceedings.

Vessel Engaged Under SEAIOCM Agreement Qualifies As 'Foreign Going Vessel' , Exemption u/s 87 of Customs Act: Kerala HC

THE COMMISSIONER OF CUTOMS vs M/S.ASEAN CABLESHIP PVT. LTD CITATION : 2025 TAXSCAN (HC) 968

The Kerala High Court ruled that a vessel hired via a SEAIOCM agreement was eligible for an exemption under section 87 of the Customs Act since it was a "foreign going vessel."

The division bench consists of Justices A.K. JayasankaranNambiar and P.M. Manoj held that the vessel can be categorized as a foreign going vessel for the purposes of claiming exemption under Section 87 of the Customs Act.

The bench disagreed with the department's assertion that the vessel would lose its status as a "foreign going vessel" due to the agreement made between the assessee and the Cochin Port Trust, which committed the assessee to berthing the vessel in Cochin Port for a certain number of days in a calendar year in order to receive a concessional rate of berthing charges. In reality, the vessel remained within territorial waters for a significant portion of the year.

Income Tax Appeal cannot be rejected solely on Non-Appearance of Assessee: Kerala HC

ANANDAN N. vs THE COMMISSIONER OF INCOME TAX (APPEALS) CITATION : 2025 TAXSCAN (HC) 969

The Kerala High Court stated that there is no provision of rejecting the appeal merely on non-appearance of assessee and the appellate authority must decide an appeal by strictly following the mandate contemplated under Section 250(6) of the Income Tax Act, 1961.

The bench noted that although the reasons for dismissing the appeal are stated in the contested decision, they pertain to the assessee's failure to present for hearings on several days.

"Evidently, going by Subsection 6 of Section 250, no other meaning can be assigned to the words "points for decision" as it obviously leads to the question that arises for consideration based on the contentions raised in the appeal," noted the division bench of Justice Ziyad Rahman A.A. As a result, the appellate authority was required to consider the issues brought up in the appeal and make a decision while providing justification.

Absence of Formal Demand Notice for Property Tax Does not Let off Assessee's Obligation to Pay: Kerala HC

VINU KOSHY ABRAHAM vs CORPORATION OF COCHIN CITATION : 2025 TAXSCAN (HC) 970

The Kerala High Court ruled that the assessee is still obligated to pay property taxes even if there isn't a formal demand notice for them while the case is pending.

The Division Bench, which consists of Justices A.K. Jayasankaran Nambiar and P.M. Manoj, stated that the assessee bears the responsibility for paying the tax after it is assessed. In the event that the assessee continues to pay the tax based on the assessment, the Corporation's failure to issue a demand notice during a period when the assessee chose not to pay the tax due to ongoing litigation between the parties, and the lack of an order halting the demand for such tax, cannot be a reason to stop the Corporation from collecting the tax amounts subsequently.

Untimely Issuance of Deficiency Memo not Grounds to Refuse Interest on Delayed GST ITC Refund: Delhi HC

M S G S INDUSTRIES vs COMMISSIONER OF CENTRAL TAX AND GSTDELHI WEST CITATION : 2025 TAXSCAN (HC) 971

20th May, 2025The Delhi High Court recently clarified that a delay by the tax authorities in issuing a deficiency memo to a taxpayer cannot be used as a reason to refuse or limit the payment of interest on delayed refunds on Input Tax Credit (ITC) on Goods and Services Tax (GST).

The Division Bench comprising Justice Prathiba M. Singh and Justice Rajneesh Kumar Gupta observed that the Petitioner cannot be denied the benefit of interest for delay caused due to the deficiency memo not having been issued within the stipulated period. Furthermore, the Bench also observed that the Petitioner had taken about 74 days to respond to the deficiency memo.

Relief to Bhima Jewels, Limitation Act Applicable on Proceedings u/s 25A of KVAT Act: Kerala HC

M/S. BHIMA JEWELS PVT. LTD vs STATE TAX OFFICER CITATION : 2025 TAXSCAN (HC) 972

In a recent case, the Kerala High Court has ruled in favor of Bhima Jewels, holding that the Limitation Act is applicable to proceedings under section 25A of the Kerala Value Added Tax Act , 2003.

A single bench of Justice Ziyad Rahman A A observed that, even in respect of proceedings under Section 25A of Kerala Value Added Tax Act the limitation prescribed under the Act would be applicable. Evidently, since the assessment year pertaining to which the proceedings are initiated is 2012 -13, by the time notice was issued, the statutory period of limitation had already expired.

In such circumstances, in the light of the principles laid down by the Court in judgment, an interference is required, as the proceedings which culminated in order are not legally sustainable. The court quashed the orders holding that the proceedings initiated therefrom are time-barred.

Income Tax Authorities Must Consider Genuine Extension Requests: Madras HC Sets aside Order Passed Without Hearing

Manoj Kiron Kumar Lulla vs Assessment Unit CITATION : 2025 TAXSCAN (HC) 973

The Madras High Court has set aside an income tax assessment order passed by the Tax Authorities after finding that the assessee’s genuine request for additional time to file a reply was not properly considered.

Justice Krishnan Ramasamyobserved that, “Normally, when an Assessee requests for time extension to file their reply, the respondents are supposed to have duly considered the said request and granted sufficient time to the petitioner.”

Under the cover of the principles of natural justice, the Madras High Court held that the order was passed without giving the petitioner a fair chance to file their reply or to be heard in person. As a result, the Court set aside the assessment order and directed the authorities to reconsider the matter.

ITR Refund of AY 2016-17 Pending: Madras HC Orders Authorities to Consider Fresh Representation filed by Taxpayer within 6 weeks

M.Sundarapandian vs The Income tax Officer (HQ) (PR) CITATION : 2025 TAXSCAN (HC) 974

In a recent ruling, the Madras High Court directed income tax authorities to consider the taxpayer’s fresh representation regarding the delayed income tax refund within six weeks. The court issued this directive without examining the merits of the case, focusing solely on ensuring timely administrative action by the authorities.

Without examining the merits and considering the limited relief sought by the petitioner, Justice Krishnan Ramasamy directed that the petitioner must submit a new representation to the second respondent, who must then forward it to the proper authority. Within six weeks of receiving the representation, the authorities were ordered to review and decide on it.

Madhya Pradesh HC Dismisses Writ Alleging Denial of Witness Cross-Examination in Bogus GST ITC Case, Directs to Pursue Appellate Remedy

M/S GOYAL TRADING CO vs UNION OF INDIA AND OTHERS CITATION : 2025 TAXSCAN (HC) 975

The Madhya Pradesh High Court has dismissed a batch of writ petitions alleging denial of cross-examination of witnesses in a case involving alleged bogus Input Tax Credit ( ITC ) under GST ( Goods and Services Tax) Act, directing the petitioners to pursue the statutory appellate remedy instead.

JusticesVivek Rusia and Gajendra Singh observed that “The petitioner is alleging the violation of principle of natural justice solely on the ground that the opportunity to cross-examine the witnesses was not given. The petitioner has failed to point out when the request was made for cross-examination of the witnesses. By not giving an opportunity to cross-examine the witnesses, whether any prejudice was caused, is liable to be examined by the appellate authority after examining the record and the relevancy of the deposition of the witnesses. The appellate authority would be competent to decide all the issues and grounds raised in the writ petition. There should not be an avoidance of pre-deposit condition for the entertainment of a statutory appeal.”

Unexplained Delay of Over Three Years in Finalizing Service Tax Order: Patna HC Sets Aside Demand for Lack of Justification

M/s Akash Tour and Travel vs The Union of India CITATION : 2025 TAXSCAN (HC) 976

The Patna High Court, set aside a service tax demand after finding an unexplained delay of over three years in finalizing the tax order, ruling that the department failed to justify the prolonged delay.

The Division Bench of Justice Rajeev Ranjan Prasad and Justice Ashok Kumar Pandey referred to earlier judgments in Kanak Automobiles, Pawan Kumar Upmanyu, and Power Spectrum, which held that while the one-year time limit wasn’t strict, the department still had to show why the delay occurred. Courts had made it clear that delays without valid reasons, like simply keeping the case pending were not acceptable.

No Automatic Bail for Magistrate-Triable PMLA Cases: Himachal Pradesh HC dismisses bail Application

Kulveer vs State of Himachal Pradesh CITATION : 2025 TAXSCAN (HC) 977

The Himachal Pradesh High Court has firmly held that offences triable by a Judicial Magistrate under the Prevention of Money Laundering Act (PMLA) do not attract automatic bail, dismissing the interim bail application of an accused businessman arrested in a cyber fraud and money laundering case.

The High Court noted that out of 12 prosecution witnesses, five had testified and the trial was scheduled to resume on June 9, 2025. The police expressed concerns that Kulveer, if released, could intimidate or influence witnesses and abscond given his out‐of‐state connections.

Rejecting the bail plea, Justice Singh underscored the gravity of laundering large sums of money. He held that individual liberty must be balanced against societal interest, and that the mere triability of an offence by a Magistrate does not confer an automatic right to bail.

GST Appeal Limitation Calculated from Physical Dispatch of Order: Madras HC rules Appeal Well Within Period

Thankiyan Georgestephen vs The Joint Commissioner of GST CITATION : 2025 TAXSCAN (HC) 978

The Madras High Court has ruled that the limitation period for filing an appeal under GST ( Goods and Services Tax Act calculated from the date of physical dispatch of the assessment order is well within the period of limitation.

The Court also noted in the submission of the petitioner that 10% of the disputed tax had already been deposited by the petitioner, and hence no additional deposit was required at this stage.

JusticeKrishnan Ramasamy observed that “The earlier assessment order was physically dispatched on 31-05-2023. If that is also taken into account, the petitioner's appeal is well within the period of limitation. Therefore, as such, there is no question of delay in filing at all. Therefore, the impugned orders are set aside. The respondents are directed to take the appeal on file and hear it on merits and pass orders at the earliest.”

Illegal Mining and Money Laundering Case: Delhi HC denies Bail Plea on Medical Grounds

VEDPAL SINGH TANWAR vs DIRECTORATE OF ENFORCEMENT CITATION : 2025 TAXSCAN (HC) 979

In a detailed order running to 22 pages, the Delhi High Court on Monday denied both regular and interim bail to businessman Vedpal Singh Tanwar, the alleged mastermind in a ₹78-crore illegal-mining and money-laundering racket linked to Dadam hills in Haryana’s Bhiwani district. Justice Girish Kathpalia ruled that Tanwar failed to cross the “twin-test” of Section 45 of the Prevention of Money Laundering Act (PMLA): the court was not satisfied that he was prima facie innocent, nor that he would refrain from further offences if released.

Adopting the Supreme Court’s benchmark in Vijay Madanlal Chaudhary, Justice Kathpalia observed that money-laundering is “an aggravated form of crime” requiring stringent bail standards. The judge noted that investigation by the Enforcement Directorate (ED) has quantified alleged proceeds of crime at ₹78.14 crore, of which ₹22.81 crore is attributed directly to Tanwar. The court agreed with prosecutors that, given the scale of the purported fraud and Tanwar’s “kingpin” role, there was a substantial risk he could abscond or tamper with evidence if freed.

GST ITC Claimed under CGST/SGST Instead of IGST during GSTR 3B Filing: Calcutta HC stays Order Directing to Reverse Excess ITC

Agro Trade Centre and Anr vs Additional Commissioner ofState Tax (Appeals) CITATION : 2025 TAXSCAN (HC) 980

The Calcutta High Court stayed the appellate authority’s order directing reversal of Input Tax Credit ( ITC ) claimed under the wrong tax heads, observing that the error caused no loss to the government and was revenue neutral.

Justice Hiranmay Bhattacharyya observed that the present case also appears to involve no actual loss to the exchequer. It was, therefore, prima facie satisfied that the circumstances warranted interim relief.

It was observed that “This Court is of the prima facie view that there is no loss of revenue to the Government and it is revenue neutral. In view thereof the order impugned dated 22.10.2024 passed in Appeal Case No. GST/APP/224/2024-2025 shall remain stayed till the disposal of the writ petition.”

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 unreasoned 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 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 Kumar Vermavs 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 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 is 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 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 of Income 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 yea,r 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 contrary to object of the scheme but also 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 State ElectricityRegulatory 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 stipulatedd 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 like transactions cannot be covered under the words "any person who holds the money as referred to under Section 226 ofthe 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 Quahes 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.

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