Goods and Services Tax

Regular bail in alleged fake-invoice input tax credit prosecution follows custody, documentary evidence, and low interference risk.
Case-Laws
GST
Regular bail in alleged fraudulent input tax credit availment through fake invoices depends on more than the seriousness of an economic offence. Relevant considerations include custody period, maximum punishment, the nature of evidence, risk of evidence tampering or witness influence, cooperation with trial, prior antecedents, and the likelihood of early trial completion. The High Court found that the accused had spent about four months in custody, faced a maximum five-year sentence, had no antecedents, and confronted documentary evidence, with no material showing interference risk. Bail was granted on bonds, subject to conditions against interfering with proceedings, requiring address updates, and restricting foreign travel without permission.
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Ex parte GST adjudication may be reopened to restore a taxpayer's opportunity to reply, submit evidence, and be heard.
Case-Laws
GST
Ex parte GST adjudication may warrant fresh consideration where a taxpayer did not answer a show-cause notice or contest proceedings because of asserted health-related inability. A justice-oriented approach supports reopening from the reply stage, permitting submission of supporting material and a reasonable hearing. A limitation-based dismissal of the statutory appeal did not involve examination on merits; the procedural focus is restoration of an effective opportunity to reply and be heard.
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Composite GST assessment orders for distinct tax periods require separate notices and hearings before any fresh proceedings.
Case-Laws
GST
Composite GST assessment orders covering five distinct tax periods are unsustainable. Separate notices must be issued for each respective tax period, and the taxpayer must receive an opportunity of hearing before fresh assessment action is taken. The High Court declined to examine the assessment merits and set aside the composite order, subject to deposit of 20% of the disputed tax within the stipulated period. On default, the authorities may proceed in accordance with law. Fresh proceedings may be initiated separately for each tax period.
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E-Way Bill compliance for returning excavators requires proof of a valid short-distance movement exemption to avoid penalties.
Case-Laws
GST
E-Way Bill requirements extend to movement of goods for reasons other than supply, including return of an excavator from a work site to registered premises. Ownership and return to the owner's premises do not independently remove that requirement. A short-distance exemption must be established with satisfactory evidence that the movement falls within Rule 138(14) or an applicable notification. Failure to prove the exemption, or to clarify the tax treatment of consideration for use of the equipment, may prevent the breach from being treated as merely procedural and may support tax-evasion consequences under CGST/UPGST enforcement provisions.
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E-Way Bill non-generation and repeated post-interception production can support tax-evasion intent and restoration of tax penalties.
Case-Laws
GST
Transportation of taxable goods without an E-Way Bill is treated as substantive non-compliance where the bill is generated only after interception and the same lapse recurs. An E-Way Bill forms part of the statutory mechanism for monitoring taxable-goods movement; its absence alongside a manually issued invoice may permit subsequent account manipulation. Post-interception production, combined with repetition in a similar transaction, indicates a deliberate course of conduct and intention to evade tax rather than a technical or procedural breach. On that basis, tax and penalty proceedings were sustained, the first appellate order was set aside, and the Proper Officer's tax and penalty order was restored.
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Handicraft job work receives concessional GST only for registered principals and predominantly handmade goods; commercial resin articles remain taxable.
Case-Laws
GST
Concessional GST for job work on brass statues and carved wooden products applies only where the goods belong to a registered person and qualify as predominantly handmade handicrafts; processing goods of unregistered persons falls under the residual treatment-or-processing entry and attracts the higher rate. Commercially cast or moulded resin statues and ornamental vases are plastic articles, not original sculptures or statuary, and are classified under the relevant plastic-articles tariff items. GST exemption covers only marble or wooden idols or murtis of gods or goddesses, not decorative figures; qualifying marble deities fall in Chapter 68 and wooden deities in Chapter 44, irrespective of eight-digit classification.
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Psyllium seed classification treats stored raw seeds as dried goods, denying fresh and seed-quality GST exemptions.
Case-Laws
GST
Psyllium seeds supplied in raw form fall under sub-heading 1211 9013, as the tariff description and HSN Notes specifically cover Psyllium seed. GST exemption as fresh or chilled goods depends on the condition at supply. Seeds stored in dry, ventilated godowns, without evidence of storage duration supporting their fresh character, acquire the character of dried seeds and cannot qualify as fresh or chilled. The exemption for goods of seed quality is likewise unavailable where the supplies are treated as dried Psyllium seeds. Such supplies are taxable as dried seeds at the applicable concessional rate.
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Show-cause notice limits penalty liability: imposing a handler's proposed penalty on the petitioner required fresh adjudication.
Case-Laws
GST
Penalty under section 122(1A) of the CGST Act must be imposed consistently with the person identified in the show-cause notice. Specified penalties were proposed against the petitioner, while the separate section 122(1A) penalty was proposed against its handler/operator; nevertheless, both penalties were imposed on the petitioner. As this mixing of proposed penalties was not specifically controverted, the penalty order was quashed and remanded for fresh adjudication after hearing the petitioner, with other issues left open.
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GST valuation notices must disclose the applicable rule; confirmation on a different rule violates natural justice.
Case-Laws
GST
GST valuation proceedings require the show-cause notice to identify the valuation rule on which the proposed demand rests. Where a notice invokes Rule 28(a), but the adjudicating authority finds that rule inapplicable and instead confirms the demand under Rule 27(c), the taxpayer must receive notice and an opportunity to respond to that distinct basis. Substituting the valuation rule at adjudication causes prejudice and breaches natural justice. A fresh show-cause notice is required before proceedings may be pursued on the revised valuation basis.
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GST registration cancellation requires independent satisfaction and tangible evidence; nil GSTR-3B turnover alone cannot establish business discontinuance.
Case-Laws
GST
Cancellation of GST registration under Section 29 requires the Proper Officer's independent satisfaction, based on cogent and tangible material, that a statutory ground for cancellation exists. Nil turnover declared in GSTR-3B returns alone does not establish discontinuance of business, especially where material indicates that business continued from the registered premises. A show-cause notice founded solely on nil turnover does not disclose a circumstance warranting cancellation. The cancellation and rejection of revocation were quashed, while the authority retained liberty to verify whether the business continued and proceed in accordance with law.
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Post-cancellation GST notice service requires an alternative mode; portal-only assessment breaches natural justice and permits fresh proceedings.
Case-Laws
GST
Service of a GST show-cause notice solely through the portal after cancellation of registration may deny the taxpayer a proper opportunity to respond. Once registration is cancelled, the taxpayer is not required to continue checking the GST portal; an alternative mode of service is required. An assessment founded only on such portal-based notice breaches principles of natural justice and was set aside. Fresh proceedings may be initiated upon proper notice, and any recovered amount remains subject to the final outcome of those proceedings.
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Omitted GST refund rule applies to pending recovery proceedings, requiring reconsideration where no savings clause preserves prior operation.
Case-Laws
GST
Omission of Rule 96(10) of the Central Goods and Services Tax Rules, 2017, without a savings clause was treated as applying to pending refund-recovery proceedings. Applying the Supreme Court pronouncement on the effect of such omission, the High Court set aside the refund-recovery orders and remanded the matters for fresh consideration under that principle. The merits of the refund-recovery claims were not decided.
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Delayed GST statutory appeals proceed on merits only after tax, interest and penalty deposit conditions are met.
Case-Laws
GST
Delayed statutory appeals against GST assessment orders may be pursued where the taxpayer undertakes to pay outstanding tax and interest and deposits 10% of the penalty. Upon compliance, the appellate authority must decide the appeal on merits without applying limitation. If the conditions are not met, tax recovery may proceed after due notice. The permission remains conditional on these payments.
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Compulsory acquisition compensation is not a GST supply, making tax deductions from land acquisition awards unlawful and refundable.
Case-Laws
GST
Compulsory acquisition of land and attached structures under eminent-domain powers is an expropriation, not a supply of goods or services for GST purposes. Land and buildings are immovable property and cannot be treated as goods, while a landowner does not provide any service through statutory acquisition. GST deducted from acquisition compensation therefore lacks statutory basis, is beyond the acquiring authority's power, and must be refunded with interest. Interest awarded on compensation under the Land Acquisition Act to account for the period until payment forms part of compensation and is not subject to tax deduction at source.
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Portal-only GST service does not trigger appeal limitation without acknowledged receipt or response to notice.
Case-Laws
GST
Portal-only service of GST show-cause notices is insufficient where there is no acknowledgement of receipt or response to the notice. Similarly, uploading a contested order-in-original solely on the Common Portal does not commence the limitation period for filing an appeal. Taxpayers affected by notices or adjudication orders served only through the portal may seek the remedies available for defective service, including protection against limitation being calculated from the portal-upload date alone.
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GST appeal delay condonation restored merits adjudication where factual challenge to tax levy required a hearing.
Case-Laws
GST
Condonation of delay beyond the ordinarily condonable period for a GST appeal was considered appropriate where rectification proceedings were not the sole explanation and the tax levy was disputed on factual grounds requiring adjudication on merits. The delay dismissal was set aside, the appeal was restored, and merits were left open for decision after an opportunity of hearing. The approach accords with treatment of a similar factual situation involving delayed GST appellate proceedings.
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Sale of hazardous detained goods must proceed promptly when unpaid GST penalties trigger statutory disposal powers.
Case-Laws
GST
Section 129(6) of the GST Acts requires detained goods to be sold or otherwise disposed of to recover an unpaid penalty after the prescribed period. Its proviso permits a shorter period where goods are perishable, hazardous or likely to depreciate. Inflammable bulk bitumen qualifies as hazardous goods, so the continuing availability of an appeal does not displace the obligation to initiate disposal where risk to the goods and conveyance warrants prompt action. Sale should proceed through public notice, with notice to the owner, within the stipulated timeframe.
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GST amnesty waiver timing depends on when input tax credit was availed, excluding later-period claims despite earlier debit notes.
Case-Laws
GST
GST amnesty waiver eligibility for interest and penalty depends on the disputed input tax credit being availed within the prescribed statutory period, rather than on the financial year in which the underlying debit notes were issued. Excess credit first claimed in the December 2020 return fell outside the scheme's temporal scope despite its connection with debit notes from 2018-19. Guidance or decisions concerning input tax credit mismatch reconciliation cannot extend an expressly limited statutory period. The waiver was unavailable, and the interest and penalty on the excess credit claim were sustained.
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Reusable gunny bag classification determines GST treatment based on continued packing utility and sale value.
Case-Laws
GST
Used jute gunny bags without plastic coating remain classifiable as reusable packing bags under Heading 6305 where they are intact, identifiable and fit for repacking agricultural produce. Classification turns on the goods' condition, essential character, commercial identity and functional utility at supply; prior use or auction sale does not by itself convert them into scrap. Worn sacks and bags fall outside Heading 6309, while Heading 6310 applies only to worn-out textile materials fit solely for recovery. GST is determined by sale value per piece: 5% up to the prescribed threshold and 18% above it. Torn, worn-out or cut bags unfit for reuse require separate classification examination.
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Tariff classification of medicated toilet soap places it under the residual GST entry rather than the concessional toilet-soap entry.
Case-Laws
GST
Medicated Toilet Soap is classified under tariff item 34011110, separate from other toilet soaps classified under tariff item 34011190. The revised GST notification adopts the Customs Tariff nomenclature and interpretative rules. The concessional Schedule I entry for toilet soap applies only to products under tariff item 34011190 and does not extend to Medicated Toilet Soap. Medicated Toilet Soap therefore falls under the residual Schedule II entry and attracts GST at 18% (9% CGST and 9% SGST).
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SC sets aside show cause notice to Tata Steel over input tax credit availed during FY19-23
GST
Dated:- 26-8-2026
PTI
New Delhi, Aug 26 (PTI) The Supreme Court has set aside a show cause-cum-demand notice against Tata Steel from tax authorities over an “alleged irregular availment of input tax credit” amounting to over Rs 1,000 crore between the financial years 2019 and 2023.

According to the notice, the steel major was required to show cause before the Additional/Joint Commissioner of Central GST & Central Excise, Jamshedpur, Jharkhand within 30 days “as to why the Goods and Service Tax (GST), amounting to Rs 1007,54,83,342 for the period FY2018-19 through FY2022-23 shall not be demanded and recovered” from the company.

Th

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of suppression of facts, merely to avail the extended period of limitation would barely suffice and puts to peril the notice under Section 74,” the bench said.

Tata Steel had contended before the top court that there is no allegation of fraud, willful misstatement or suppression of facts.

The dispute arose from a show cause notice issued to Tata Steel for the financial years 2018-19, 2019-20 and 2020-21 concerning an alleged mismatch of Input Tax Credit (ITC) and short payment of tax.

The notice was issued under Section 74 of the Central Goods and Services Tax Act, which deals with GST demand involving fraud or suppression.

The steel major submitted that the notice contained no factual allegations establishing fraud, wilful mis

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GST demand limitation bars late notices unless extended recovery is supported by foundational fraud or suppression facts.
Case-Laws
GST
GST demand limitation under Section 73 runs from the due date for the annual return; extensions of those due dates change its commencement, and pandemic-period exclusion must be applied when calculating the three-year period. A notice issued after the resulting deadline cannot be sustained under the ordinary limitation. Recourse to Section 74's five-year period requires the Assessing Officer's satisfaction, based on disclosed foundational facts, that fraud, wilful misstatement or suppression caused the tax shortfall or excess input tax credit. Audit objections and bare statutory assertions are insufficient. The show-cause notice and consequential order were set aside, with liberty for fresh Section 74 proceedings within the applicable extended limitation.
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Fair hearing in budgetary support claims requires an opportunity to explain input tax credit declaration discrepancies before determination.
Case-Laws
GST
Fair hearing in budgetary support claims requires the claimant to receive an opportunity to explain discrepancies between an input tax credit declaration and a Chartered Accountant certificate submitted at the respondents' direction. Where the declaration contains an asserted error, the officer must call for an explanation and consider supporting material before concluding the claim on merits. A claim cannot be finally determined merely by relying on the discrepant declaration without this opportunity. The challenged order was set aside to that extent, with directions to permit supporting documents and reconsider the claim after a reasonable hearing.
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Bail in fraudulent input tax credit allegations granted where investigation was nearly complete and further custody unnecessary.
Case-Laws
GST
Bail was granted to an accused alleged to have operated a firm used for fraudulent availment of input tax credit, although the firm was registered in his spouse's name. The High Court treated the investigation concerning the accused as almost complete and considered that certain co-accused had already received bail. Balancing the detention period against the nature and gravity of the allegations, it found that further custodial detention was unnecessary for the investigation. Release was subject to a bond and surety, monthly appearance before the Investigating Officer, and compliance until submission of the charge-sheet.
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Input tax credit time limits: Section 16(5) preserves entitlement where the relevant return was filed before the cut-off.
Case-Laws
GST
Section 16(5) of the Central Goods and Services Tax Act overrides section 16(4) and preserves input tax credit entitlement for specified financial years where the return under section 39 was filed by 30 November 2021. For Financial Year 2018-19, a return filed on 23 October 2019 fell within the preserved period. Denial of the related input tax credit was therefore impermissible, and the Order-in-Original denying the claim was set aside and quashed.
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