Goods and Services Tax

2 held for creating fake GST firms, claiming Rs 11.79 cr Input Tax Credit
GST
Dated:- 13-11-2025
PTI
Hyderabad, Nov 13 (PTI) Two persons have been arrested for allegedly being part of an inter-state network that created 10 fake GST-registered firms and fraudulently claimed Rs 11.79 crore Input Tax Credit (ITC), the police said on Thursday.
According to a release from the Cyberabad Police Commissionerate, the accused used forged documents to register the firms and generate fake invoices and fabricated turnovers, causing a loss of Rs 11.79 crore to the government.
The network operated across several states, using fake Aadhaar cards, PAN cards, electricity bills, rental agreements, and other forged documents. They also manipulat

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93-day delay condoned due to consultant incapacitation supported by psychiatrist certificate; appellate order set aside, appeal restored
Case-Laws
GST
The HC allowed the writ petition, holding that the petitioners' explanation for a 93-day delay in filing the statutory appeal – namely incapacitation of their consultant supported by a psychiatrist's certificate – was reasonable, plausible and not indicative of gross negligence or deliberate laches. The court condoned the delay, set aside the impugned appellate order dated March 29, 2025, and remitted the matter to the Appellate Authority for adjudication on merits. The petition is disposed of accordingly, with directions limited to restoration of the appeal for fresh hearing before the appropriate appellate forum.
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Order quashes penalty under Section 129(1)(b); directs recalculation under Section 129(1)(a) where e-way bill and invoice identify registered dealer
Case-Laws
GST
The HC set aside the impugned order dated 18.10.2025 and allowed the petition, holding that where goods were accompanied by an e-way bill and tax invoice identifying a registered dealer, any liability could only arise under Section 129(1)(a) of the U.P. Goods and Services Tax Act, 2017; the Adjudicating Authority erred in computing penalty under Section 129(1)(b). The matter is remitted to the tax authorities to quantify the penalty in accordance with Section 129(1)(a) within three weeks of the order. The petition is disposed of; parties are directed to comply with the remittal for calculation of the appropriate penalty.
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Petition dismissed for procedural abuse and failure to comply with Section 107(6)(b) pre-deposit; Order II Rule 2 CPC applied.
Case-Laws
GST
The HC dismissed the petition challenging an ex parte order under Section 74 UPGST Act, holding the challenge misconceived and liable to be rejected. The court found the appellant pursued successive writs to evade the pre-deposit required by Section 107(6)(b) of the GST Act, failed to seek exemption from pre-deposit before the appellate authority and the apex court, and did not prosecute the statutory appeal within limitations. Applying principles of Order II Rule 2 CPC, the HC held the remedy of appeal and exemption were always available and deliberately not pursued; accordingly the petition is dismissed for non-compliance with the statutory pre-deposit requirement and procedural abuse.
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Liquidated damages under concession agreements are not consideration for taxable supply; GST not chargeable, reliance on Circular No.178/10/2022-GST
Case-Laws
GST
AAR held that liquidated damages paid by the applicant to the concessionaire under the concession agreement do not constitute consideration for a taxable supply and are not subject to GST; accordingly, the concessionaire is not entitled to avail input tax credit in respect of such receipts. The Authority applied Circular No.178/10/2022-GST reasoning that where damages merely compensate for loss without any express or implied agreement by the recipient to tolerate or perform acts for the payer, such payments are a monetary compensation flow and not taxable. AAR further noted CBIC clarification on penal charges as analogous, observing the charges enforce contractual discipline for breaches. No other questions required adjudication.
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GST input tax credit for lease rental of land barred under section 17(5)(d) CGST Act, covering vacant portions
Case-Laws
GST
AAR held that the applicant is not entitled to claim input tax credit of GST charged on lease rental for land allotted for construction of an industrial unit, as such credit is specifically barred by section 17(5)(d) of the CGST Act. The bar applies irrespective of timing (pre-construction or post-construction), to any vacant portion of the leased land reserved for the project, and extends to amounts attributable to reconstruction, renovation, addition, alteration or repairs, since “construction” encompasses those activities. The Authority rejected attempts to limit section 17(5)(d) by reference to nexus or to section 17(5)(c), noting both clauses operate independently.
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Fusible interlining with 85%+ cotton classifiable under Chapter 52; textile composition test determines tariff treatment
Case-Laws
GST
AAR held that fusible interlining fabric composed of 85% or more cotton is classifiable under Chapter 52 of the Tariff Schedule. Relying on the legal effect of the Tribunal's prior order and Circular No. 5/89 concerning the treatment of fusible interlinings before the insertion and after deletion of Note 2(c) to Chapter 59, the Authority concluded that such goods are to be classified according to their predominant textile material; where cotton predominates, Chapter 52 applies. The applicant's submitted laboratory test establishing textile composition governed the classification outcome, resulting in duty treatment and tariff classification under Chapter 52.
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Retail inflation in October touches record low of 0.25 pc on GST cuts
GST
Dated:- 12-11-2025
PTI
New Delhi, Nov 12 (PTI) Retail inflation fell to a record low of 0.25 per cent in October following cut in GST rates on nearly 380 items of mass consumption coupled with subdued prices of vegetables, fruits and eggs.
October Consumer Price Index (CPI)-based inflation was lowest in the current series (base year 2012), which captures data since January 2014.
The inflation was 1.44 per cent in September and 6.21 per cent in October 2024.
According to the data released by the National Statistics Office (NSO), the food inflation declined to (-) 5.02 per cent in October.
The decline in headline inflation and food inflation during O

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per cent), Karnataka (2.34 per cent), Punjab (1.81 per cent) and Tamil Nadu (1.29 per cent).
The inflation was negative in several states, including Assam, Bihar, Chhattisgarh, Delhi and Uttar Pradesh.
Commenting on the data, Aditi Nayar, Chief Economist at ICRA, said the Reserve Bank's Monetary Policy Committee (MPC) is likely to pare its CPI inflation projection for FY2026 further from 2.6 per cent, driven by the soft sequential momentum in food prices as well as the impact of the GST rate rationalisation on several items in the CPI basket.
“This, along with the dovish tone of the October 2025 policy document, would support a 25-bps rate cut in the December 2025 policy review, unless Q2 FY2026 GDP growth surprises on the upside,” s

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Petition dismissed; proceedings under Section 130 read with Section 122 and Section 35(6) upheld for unaccounted goods
Case-Laws
GST
The HC dismissed the petition and upheld the impugned orders instituting proceedings under section 130 read with section 122 of the GST Act against the respondent. Relying on statutory obligations under section 35 and sub-section (6) thereof, the Court affirmed that where a survey reveals unaccounted goods the Proper Officer may determine tax liability and invoke provisions of sections 73/74 mutatis mutandis; the Court considered but distinguished prior authorities addressing use of section 130 for excess stock and concluded there was no jurisdictional infirmity or ground to interfere with the initiation of proceedings. Petition accordingly dismissed.
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Penalty Under s.129(3) GST Set Aside Where Part B E-Way Bill Not Generated Due To Technical Error, No Mens Rea
Case-Laws
GST
The HC quashed the impugned orders imposing penalty under s.129(3) of the GST Act and allowed the petition. The court found the record established non-generation of Part B of the e-way bill due to a technical error, which was not disputed, and no authority had recorded any finding of mens rea to evade tax. Absent any proven intent to evade payment of tax, the statutory prerequisite for levy of the s.129(3) penalty was not satisfied. In consequence, the penalty and consequential orders were set aside and the petitioner's challenge succeeded.
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Remit for fresh re-examination under s.75(2) whether penalty under s.74 instead of s.73 was inappropriate; reply within 30 days.
Case-Laws
GST
The HC remitted the matter to the respondent for fresh consideration whether the petitioner, who has paid the tax and limited its dispute to imposition of penalty and applicability of machinery provisions, validly contends that proceedings under s. 74 are inappropriate and should have been initiated under s. 73; the respondent is directed to exercise powers under s. 75(2) and complete the re-examination within three months from receipt of this order. The petitioner must file a detailed reply to the notice and treat the impugned order as a show cause notice within 30 days. The petition is disposed of.
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Bail granted to accused under clauses (b),(c),(f),(l) of Section 132(1) CGST Act over alleged Rs.23.66 crore ITC
Case-Laws
GST
HC granted bail to the accused in respect of alleged offences under clauses (b), (c), (f) and (l) of Section 132(1) of the CGST Act, which attract maximum imprisonment of five years and fine. The Court observed the prosecution case is documentary and electronic, the allegations of wrongful availment/passing of ITC totalling Rs.23.66 crore remain to be proved, and prolonged pre-trial detention (in custody since 28.01.2025) is unwarranted given the right to speedy trial and the principle that bail is the norm. Bail was allowed subject to furnishing bail/surety bonds to the satisfaction of the trial Court/Duty Magistrate and compliance with imposed conditions.
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Writ petition dismissed as not maintainable over alleged fraudulent ITC and clandestine clearances; petitioner directed to pursue statutory appeal
Case-Laws
GST
The HC dismissed the writ petition as not maintainable in view of alleged fraudulent availment of Input Tax Credit and clandestine clearance of goods, holding that writ jurisdiction is ordinarily inappropriate where complex factual investigations, voluminous evidence and potential prejudice to the exchequer and the GST regime are involved. The Court relegated the Petitioner to statutory appellate remedies, observed that large-scale ITC claims or GST evasion should be ventilated on appeal, and permitted the Petitioner to file an appeal against the impugned order by 30 November 2025 with the requisite pre-deposit in accordance with law. Petition disposed.
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Fresh demand on identical grounds barred when Section 61(2) explanation accepted; Section 73 notice and order quashed
Case-Laws
GST
HC held that the petition is maintainable and that issuance of a fresh demand on identical grounds previously examined under Section 61 is impermissible. The court construed Section 61(2) as creating an embargo on further demands, including those under Section 73, where the taxpayer's explanation was accepted; Section 73 contains no non-obstante provision to override Section 61(2). Consequently, the show-cause notice issued under Section 73 and the consequential adjudication were vitiated. The impugned SCN dated 29 May 2024 and the resultant order dated 28 Aug 2024 are quashed, and the petition is disposed of with the petitioner granted relief.
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Next generation GST reforms led to growth in sales across sectors: Sitharaman
GST
Dated:- 11-11-2025
PTI
Coimbatore (Tamil Nadu), Nov 11 (PTI) Union Finance Minister Nirmala Sitharaman on Tuesday said that the implementation of next generation GST reforms on September 22 has led to a growth in sales across sectors, including automobiles, consumer durables, e-commerce among others.
During an interaction on Next Generation GST reforms at an event organised by the Tamil Nadu Vanigar Sangagalin Peramaippu here, she said her Ministry would continuously work on further simplifying the Goods and Services Tax system.
Sitharaman said Prime Minister Narendra Modi has been stressing the simplification of GST norms, rate cuts and product

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They are also called as SIN goods. For example, tobacco products like cigarettes come under this category.” In her brief address, she said that soon after the next generation GST reforms were introduced on September 22, sales of consumer durables has surged. “For example, sales of Air-conditioners doubled. Similarly, television manufacturers told us that they have seen a 30-35 per cent increase in sales of 43 and 55 inch televisions.” “This conveys that those people who had small television sets at their home opted for bigger ones after the GST reforms were introduced,” she said.
Traders engaged in sales via online, particularly e-commerce players, said that they have witnessed a 20 per cent sales jump, she added.
On the sales of automo

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GST reduction: New life insurance business premium touches Rs 34,007 cr in October
GST
Dated:- 11-11-2025
PTI
Kolkata, Nov 11 (PTI) India's life insurance sector continued its double digit growth for the second month in a row, with new business premium up by 12.1 per cent year-on-year touching Rs 34007 crore in October, 2025, CareEdge Ratings said on Tuesday, quoting data provided by Life Insurance Council and IRDAI.
This represents a significant rebound from 5.2 per cent decline in August 2025. The rise was mainly driven by strong performance in the individual segment, particularly non-single premium policies, indicating growing demand for recurring products.
In addition to the above, the recent reduction in GST on individua

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s.73 KGST adjudication quashed for same period; ex parte orders set aside and matters remanded for fresh hearings
Case-Laws
GST
HC allowed the petition, finding violation of the principles of natural justice due to denial of adequate opportunity. The court quashed the multiple adjudication orders issued under s.73 of the KGST Act for the same tax period as impermissible and remitted that claim to the respondents for fresh consideration in accordance with law. The HC also set aside ex parte adjudication orders for other tax periods where the petitioner had not responded to show-cause notices, and remitted those matters for rehearing on condition that the petitioner may file replies and the respondents reconsider the claims afresh. Relief granted by way of remand; matters to proceed in accordance with statutory procedure and principles of natural justice.
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Initial appeal rejection for missing mandatory pre-deposit upheld; belated appeal time-barred; restore appeal if 25% cash deposit within 30 days
Case-Laws
GST
The HC dismissed the writ petitions subject to conditions: the Appellate Authority's initial rejection of an appeal for failure to make the mandatory pre-deposit was upheld as valid, and a subsequent belated appeal was held time-barred; res judicata did not apply because the first appeal was not an appeal in law. The petitions are disposed by directing restoration of the appeal before the Appellate Authority provided the petitioner deposits 25% of the disputed tax in cash from the petitioner's Electronic Cash Register within 30 days of receipt of the order, failing which the Appellate Authority may proceed in accordance with law.
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Ex parte order set aside after email notices landed in junk; matter remitted for fresh consideration under Section 73(9)
Case-Laws
GST
The HC allowed the petition, holding that principles of natural justice were violated because the petitioner did not receive notices sent to an email that landed in the junk folder, resulting in an ex parte order. Accepting the petitioner's assertion of bona fide inability and sufficient cause to file replies, the court set aside the impugned order dated 13.03.2024 issued by respondent No.3 under Section 73(9) read with Sections 73(10), 50, 122(2)(a) of the KGST Act and corresponding provisions in the CGST Act and IGST Act. The matter is remitted to respondent No.3 for fresh consideration in accordance with law from the stage of the petitioner submitting a reply to the show-cause notice dated 26.12.2023.
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Partial relief: penalty of Rs.6,05,17,933 set aside for failure to apply Sections 74, 75 and improper use of Section 122
Case-Laws
GST
The HC allowed the petition in part, holding that the impugned orders issued by the respondents were illegal, arbitrary and without jurisdiction insofar as they imposed and confirmed a penalty of Rs. 6,05,17,933/-. The Court found that the respondents failed to apply Sections 74 and 75 of the KGST Act and improperly invoked Section 122, resulting in a penalty demand exceeding both the show cause notice and the confirmed tax. The HC set aside the impugned orders to the limited extent of the aforesaid penalty and remitted the matter to the 2nd respondent for fresh reconsideration in accordance with law, preserving the petitioner's readiness to pay tax and interest as determined.
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Section 129 CGST: Penalty and seizure quashed where expired e-way bill due to driver illness showed no mens rea
Case-Laws
GST
The HC allowed the petition and set aside the impugned orders under section 129 of the CGST Act. The court found the transaction to be a bona fide bill-to-ship movement from Maharashtra to Uttar Pradesh, supported by tax invoice, e-way bill and GR, and recognized by the State and its circular. Seizure solely on account of an expired e-way bill did not establish mens rea to evade tax; the delay resulted from the driver's illness and no adverse material showed intent to evade. In absence of requisite culpable mental element, penalty and seizure proceedings were unsustainable and were quashed.
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Petition allowed; proceedings under section 74 require recorded fraud finding, penalties under sections 130(3)/122 unsustainable without it
Case-Laws
GST
The HC allowed the petition and set aside the impugned appellate decision to the extent it refused complete relief to the petitioner. The court held that initiation of proceedings under section 74 requires a recorded finding of fraud, mis-statement or suppression of fact with intent to evade tax, which is absent on the record; accordingly proceedings framed and penalties levied under section 130(3) read with section 122 could not be sustained insofar as they relied on section 74-type allegations. The matter was remitted for reassessment limited to available findings, and any enhanced liability attributable to non-fraudulent discrepancies was confined to the reduced quantum previously accepted.
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Assessment orders quashed: Rule 142(1A) requires Form GST DRC-01A notice for periods before 15.10.2020; fresh assessment ordered
Case-Laws
GST
The HC quashed and set aside the assessment orders dated 28.02.2025 and held that for assessment periods prior to 15.10.2020 the pre-condition of service of notice in Form GST DRC-01A under Rule 142(1A) is mandatory; consequently an assessment made without such notice is invalid. The matter is remitted to the assessing authority to initiate fresh assessment proceedings after issuance of notice in Form GST DRC-01A and to pass consequential orders only after affording the petitioner an opportunity of hearing. The petition is allowed; parties are anonymized as petitioner and assessing authority/respondents for all ensuing proceedings.
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Rule 86A permits temporary withholding of ECL ITC when fraud suspected but cannot block debits beyond available ITC balance
Case-Laws
GST
The HC held that orders blocking debit from taxpayers' Electronic Credit Ledgers (ECL) beyond the Input Tax Credit (ITC) available at the time are unsustainable and set aside such entries to that extent, allowing the petitioners. The court construed Rule 86A as an emergent, protective power permitting the Commissioner or an authorized officer to temporally withhold available ITC where there is reason to believe credits were fraudulently availed or ineligible, but not as a recovery mechanism. Such withholding may be exercised without prior show-cause notice given its protective character, yet it cannot bar debits exceeding the actual ECL balance. Arguments based on differing HC pronouncements and interim Supreme Court orders were rejected on the facts.
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Challenge dismissed; disciplinary authority to complete inquiry and adjudicate misconduct in Assistant Commissioner suspension within three months
Case-Laws
GST
The HC dismissed the writ petition challenging suspension of the Assistant Commissioner of State Tax and declined to adjudicate the merits of alleged negligence in failing to act on an adverse report concerning a fictitious input tax credit claim by a bogus firm. The Court held that disciplinary and fact-finding proceedings fall within the disciplinary authority's domain and, under Article 226, it will not usurp that jurisdiction to determine factual disputes. The petition was disposed of with a direction that the disciplinary authority complete the disciplinary inquiry within three months from receipt of the certified copy of this order, thereby preserving the authority's power to adjudicate misconduct and potential departmental action.
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