Goods and Services Tax

Retrospective GST registration cancellation does not bar audit of historical compliance records, while concealment defeats discretionary writ relief.
Case-Laws
GST
GST audit jurisdiction extends to records, returns, input tax credits, refunds and compliance during a period when registration existed, even if registration is later cancelled retrospectively. Retrospective cancellation does not erase the historical fact of registration or place underlying conduct beyond audit; audit authority arises from the statutory audit definition, audit provision and prescribed procedure, rather than the cancellation provision. Audit does not validate returns treated as void or determine tax liability, which remains subject to applicable statutory mechanisms. Material non-disclosure of a pending audit notice in earlier writ proceedings seeking retrospective cancellation can independently bar discretionary writ relief. The writ petition was dismissed, the audit notice remained effective for its stated period, and interim protection was vacated.
TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

Further investigation alone cannot justify continued custody where the triple test supports conditional regular bail in tax-fraud allegations.
Case-Laws
GST
Further investigation after expiry of the statutory period, without any remaining recovery or discovery, does not by itself support continued custody in alleged fraudulent input tax credit matters. Where the offence carries a limited maximum sentence and is triable by a Magistrate, risks of interference with evidence, witnesses, or investigation should be assessed under the triple test and addressed through bail conditions. Continued incarceration pending a potentially lengthy trial may amount to pre-trial punishment, contrary to the principle that bail is the rule and jail the exception. Conditions may require cooperation with investigation, attendance at trial, and non-tampering with evidence or witnesses.
TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

Alternative statutory remedy governs GST hearing-notice disputes where alleged procedural defects require examination of disputed records on appeal.
Case-Laws
GST
Availability of an efficacious statutory appeal ordinarily restrains writ jurisdiction over GST demands, even where breach of natural justice is alleged. Claims of non-service of personal-hearing notices, inadequate virtual-hearing opportunity, or failure to consider explanations do not automatically displace the appellate remedy. Where resolution depends on disputed records concerning registered email addresses, dispatch and communication of notices, hearing particulars, and submitted explanations, the appellate authority is the appropriate forum to examine them. The taxpayer may pursue the statutory appeal with all procedural and merits contentions left open.
TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

Input tax credit reversal on common inputs requires verification, while annual-return discrepancies require examination before tax determination.
Case-Laws
GST
Section 17(2) requires input tax credit reversal only to the extent credit on common goods or services supports both taxable and exempt supplies; no reversal arises for wholly exempt traded cattle feed where no credit was availed on its purchase. GSTR-9 may correct figures reported in periodic returns, but a difference between GSTR-1 and GSTR-9 attributed to clerical error requires verification. Credit availability, any reversal, and resulting tax liability require determination after examining records and the reconciliation explanation with an opportunity of hearing.
TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

E-way Bill Values Alone Cannot Establish Job Worker Taxable Turnover Without Independent Evidence of Taxable Supply
Case-Laws
GST
E-way bill values in job work movements cannot, without independent evidence, be treated as a job worker's taxable turnover. E-way bills record goods movement, and their generation by a person involved in the transaction is not determinative where consignor and consignee particulars are correctly declared. Goods sent by a principal for processing and returned thereafter do not establish a taxable supply by the job worker, who paid tax on job work charges. A mismatch between e-way bill data and GST returns, absent proof of supply or tax evasion, could not sustain the demand. The Tribunal therefore set aside the demand, interest and penalty.
TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

Form GSTR-1 rectification permits correction of B2B supplies wrongly reported as B2C without duplicating tax liability.
Case-Laws
GST
Form GSTR-1 rectification permits correction of B2B supplies mistakenly reported as B2C where invoices and outward-supply statements identify registered recipients. Re-reporting those supplies with March 2020 supplies can duplicate outward supplies, artificially inflate turnover and tax liability, and create an apparent short payment despite tax having been discharged through the corresponding Form GSTR-3B returns. Section 39(9) permits rectification within its outer time limit where the error did not arise from departmental scrutiny, audit, inspection, or enforcement activity; it does not require errors from a financial year to be corrected only in a succeeding financial year. The inflated GSTR-1-based demand was therefore quashed.
TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

Fake-invoice penalties remain available where taxpayer admissions and records establish unsupported input tax credit claims and false GST documentation.
Case-Laws
GST
Board circulars cannot curtail statutory penalties applicable to fake-invoice transactions. False GST records, invoices issued without actual supply, contradictory admissions, cancelled registrations, and vehicle details inconsistent with goods transport may support penalties for creating fake documents and furnishing false returns with intent to evade tax. A taxpayer's statement under statutory summons may be relied upon without corroboration where it was not obtained by duress or coercion. Taxpayers claiming input tax credit must prove actual receipt of goods and suppliers' tax payment; additional documents cannot be relied on at the appellate stage without compliance with Rule 112. Penalties for unsupported input tax credit and false documents were restored, with bank-balance appropriation and attachment maintained.
TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

Tax collected but not remitted attracts Section 76 liability, while delayed GSTR-3B credit remains time-barred.
Case-Laws
GST
Section 76 requires every person collecting an amount as tax to remit it to the Government, irrespective of registered status, composition scheme, exempt supplies, or the passing of input tax credit. Tax invoices and bank records evidencing consideration inclusive of tax establish actual collection for this purpose. Input tax credit is available only within statutory time limits; GSTR-3B returns filed after the prescribed deadline cannot validly be used to utilise time-barred credit. Debits through the electronic credit ledger for such credit are irregular and liable to disallowance, with consequential tax demand, interest, and equivalent penalty.
TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

Portal Downtime Delaying E-Invoice Generation Cannot Support Detention Penalty Where Transport Documents Fully Disclose the Consignment.
Case-Laws
GST
Portal downtime preventing IRN generation at dispatch did not justify a goods-detention penalty where the commercial invoice, e-way bill and delivery note accurately disclosed the goods, value and tax particulars, and the IRN was generated later. Transportation under a delivery note operated as a safeguard where an invoice could not be issued on removal. Section 129 was treated as addressing clandestine movement and deliberate non-disclosure, not a technical reporting lapse without intent to evade tax; the penalty was therefore set aside. Payment through DRC-03 to secure release of detained goods and vehicle, made under economic duress, did not estop a substantive challenge. The amount paid was refundable with statutory interest after verification.
TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

Transit-document compliance: post-detention invoices cannot validate garment movement, leaving the transporter exposed to owner-independent penalties.
Case-Laws
GST
Mandatory transit-documentation rules require invoices and e-way bills that correspond to goods physically carried at the time of movement. Invoices supplied only after detention, particularly without matching e-way bills, do not cure a movement unsupported by compliant records. Where no authentic, pre-existing ownership records identify the goods at interception, the transporter may be treated as a person other than the owner for penalty purposes. Undocumented garments may be valued using product quality, fabric specifications and prevailing wholesale-market averages where matching invoices are unavailable and buyers cannot be traced; such valuation must rest on objective and rational market indicators.
TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

Physical verification overrides discrepant GST transport documents where cumulative evidence demonstrates intention to evade tax.
Case-Laws
GST
GST detention penalties can be sustained where invoices, e-way bills and transport documents do not correspond with goods physically verified in transit. Documentary existence alone does not establish coverage of the transported goods; supplier-wise and aggregate weight discrepancies require reconciliation with contemporaneous electronic and transport records. Unsupported challenges to weighment, including those lacking timely objection, independent reweighment or technical evidence, do not negate such discrepancies. Cancellation and regeneration of e-way bills for the same invoice also require explanation. Cumulative material discrepancies established intention to evade tax, resulting in restoration of the original tax and penalty order.
TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

Works contract classification applies to permanently installed fire-protection systems, while earthwork and obsolete IGST concessions remain unavailable.
Case-Laws
GST
Supply, erection, testing and commissioning of fire-protection equipment constitute a composite supply where naturally bundled. Once permanently installed and not removable without substantial dismantling, the system is immovable property; transfer of goods with its installation constitutes a works contract, treated as a supply of services under Heading 9954. Excavation and backfilling do not qualify the contract for the predominantly earthwork rate where earthwork is not predominant. Classification or concessional IGST treatment under omitted entries or a rescinded notification is unavailable.
TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

Professional fee recovery for GST refund representation succeeds where direct engagement, fee acknowledgement, and authority are established despite contingency claims.
Case-Laws
GST
Recovery of professional fees for GST refund representation depended on proof of direct engagement, authority and acknowledgement of the agreed fee. A power of attorney, appearances before the GST authority and correspondence established the representative's authority and the company's fee obligation. The claimed condition that fees became payable only on receipt of the refund lacked contractual support, and non-joinder of chartered accountants did not defeat the claim. The agreed fee was recoverable, with pendente lite and future interest fixed at 6% per annum from suit filing until realisation.
TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

Zero-rated turnover follows the export invoice and removal period, while actual export remains mandatory for refund entitlement.
Notes
GST
Rule 89(4) attributes the value of zero-rated goods to the refund period in which export invoices are issued and goods are removed under bond or LUT, rather than the later period of physical export. Sections 12 and 31 support invoice-and-removal recognition of supply, while actual export remains essential to establish export status and sustain the refund. Shipping bills and export records verify the later export event and must correlate with relevant invoices. Where export is delayed or does not occur within the stipulated period, Rule 96A governs extensions, tax and interest consequences; a mismatch in invoice and physical-export dates alone does not exclude the value from zero-rated turnover.
TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

Ineligible input tax credit alone does not establish suppression; enhanced consequences require proof of intent to evade tax.
Notes
GST
Section 74 requires more than wrongful availment or utilisation of input tax credit: fraud, wilful misstatement, or suppression of facts with intent to evade tax must be alleged and proved. Under the former Explanation 2, suppression covered failure to declare legally required information or failure to provide information sought in writing, but did not remove the intent requirement. Disclosures in returns, annual reconciliations and portal filings materially weaken a non-declaration allegation. Mere audit detection or non-response to audit communications does not independently establish suppression, particularly where the notice did not plead that basis. Section 74 proceedings and enhanced penalties therefore require evidence of deliberate concealment, and appellate review cannot sustain a demand on a materially new allegation beyond the show cause notice.
TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

Input tax credit requires independent, reasoned assessment; supplier tax default alone cannot mechanically determine purchaser liability.
Case-Laws
GST
Input tax credit claimed by a purchasing dealer cannot be determined mechanically solely because registered suppliers allegedly failed to deposit tax. The proper officer must independently assess the purchaser's liability under the applicable provision, consider documentary material supporting supplies, hear the parties, and issue a reasoned speaking order. Findings that the purchaser's material supported the supplies and that fraud was not established remain undisturbed, while the merits of the credit claim remain open for lawful determination.
TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

Regular bail in fraudulent input tax credit allegations: continued investigation cannot justify prolonged pre-trial custody.
Case-Laws
GST
Regular bail in alleged fraudulent input tax credit claims may be granted despite continuing further investigation where no recovery or discovery remains, offences carry a limited maximum sentence, and are triable by a Magistrate. Expiry of the statutory period and proposed witness examinations alone do not warrant indefinite custody. Risks of evidence tampering or evasion can be managed through conditions under the triple test. Prolonged detention pending a trial likely to take time constitutes pre-trial punishment and conflicts with the principle that bail is the rule and jail the exception. Bail was granted subject to conditions securing participation and protecting evidence.
TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

Clean slate principle does not extinguish GST liabilities when a corporate debtor is sold as a going concern.
Case-Laws
GST
Clean slate principle does not extinguish GST liabilities when a corporate debtor is sold as a going concern in liquidation. Such a sale transfers identified assets and liabilities as a single package, preserves the corporate identity, and requires the purchaser or new management to assume pre-existing, current and moratorium-period liabilities. The statutory priority for distribution of realised liquidation assets does not apply to a going-concern sale. GST demand proceedings require fresh adjudication where no effective reply was filed and transfer-of-business liability requires consideration, subject to a 25% deposit of disputed tax and a detailed reply.
TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

Meaningful pre-decisional hearing is required before input tax credit blocking; inadequate notice invalidates Rule 86A action.
Case-Laws
GST
Rule 86A requires a meaningful pre-decisional opportunity before input tax credit is blocked. Where a claimant must produce records and substantiate the credit claim, a three-day notice is insufficient and reduces the hearing requirement to an empty formality. Administrative and quasi-judicial action must be right, just and fair, rather than arbitrary or oppressive; denial of fair hearing may render the action void from inception. The High Court quashed the blocking order and consequential actions, directed unblocking of the credit, and permitted fresh action only after an adequate opportunity to produce records and be heard.
TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

Belated ITC-03 compliance requires fresh consideration of composition levy eligibility and may affect consequential GST tax proceedings.
Case-Laws
GST
Belated filing of Form ITC-03 requires consideration when determining a taxpayer's eligibility for the composition levy under Section 10 read with Rule 3. Denial based solely on non-filing, particularly where the taxpayer's reply was not considered, should be reassessed after taking subsequent compliance and the taxpayer's response into account. Acceptance of composition eligibility may affect consequential tax proceedings under Section 74, while collection and payment of composition tax may continue without prejudice to the tax authorities' rights.
TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

GST collected but not remitted attracts Section 76 penalty even where registered suppliers issued valid invoices.
Case-Laws
GST
Section 76(1) applies to every person who collects an amount as representing GST and does not pay it to the Government, without limiting its scope to unauthorised collections or unregistered persons. A registered supplier that collects GST through valid invoices but files nil or no returns and fails to remit the collection falls within the provision, regardless of whether the underlying supplies are taxable. The prescribed penalty equals the tax collected and not remitted. On that basis, the appellate deletion of penalty was reversed and the penalty restored.
TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

Input tax credit claims require documentary proof, while delayed supplier payment triggers reversal, interest and statutory minimum penalties.
Case-Laws
GST
Input tax credit eligibility rests on the claimant, who must substantiate invoices, supplier payment, transport or goods receipt, and supplier ledger evidence. Retrospective cancellation of a supplier's registration alone remains unresolved as a basis for denying credit. Where credit is inadmissible, consequential interest requires quantification by the proper officer. Failure to pay a supplier within 180 days requires reversal or addition of equivalent credit to output tax liability with interest; unavailable FORM GSTR-2 does not remove that liability, and later payment permits re-availment without extending the deadline. Statutory minimum penalties apply separately under Central and State enactments and aggregate under the integrated tax regime.
TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

GST refund limitation runs from return filing, and neither delay condonation nor absence of unjust enrichment revives claims.
Case-Laws
GST
GST refund claims for tax paid at an excess rate must be made within the statutory two-year limitation period. Where excess GST was reported and paid through a GSTR-3B return, limitation runs from the relevant return filing and payment date, not from later discovery of the payment error. Neither the Proper Officer nor the appellate authority has an enabling power to condone delay or grant a refund after limitation expires. Absence of unjust enrichment does not cure a time-barred claim because direct refund provisions apply only to refunds otherwise admissible under the statutory scheme.
TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

Section 74 requires proven intent to evade; delayed GST returns alone require liability consideration under Section 73.
Case-Laws
GST
Section 74 applies only where unpaid or short-paid GST is attributable to fraud, wilful misstatement, or suppression of facts with intent to evade tax, supported by material on record. Delayed filing of returns alone does not satisfy those conditions where the subsequently filed returns correctly disclose turnover and tax liability, no material information remains undeclared, and tax with applicable interest has been paid before proceedings begin. Where Section 74 is inapplicable, liability may still require determination under Section 73 read with Section 75(2) by the original adjudicating authority within the statutory time limit.
TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

GSTR-2A/GSTR-3B mismatch cannot defeat timely prior-year input tax credit without invoice-wise verification and reasoned appellate consideration.
Case-Laws
GST
For the disputed period, a year-wise GSTR-2A/GSTR-3B mismatch alone could not sustain denial of input tax credit where omitted prior-year credit was claimed within the statutory time and could be verified invoice-wise. GSTR-2A operated as a facilitative statement, and no independent ineligibility of the reflected credit was alleged. A reasoned appellate order must address material grounds, state the points for determination, and provide reasons even where the appellant does not appear. Certification requirements for supplier-side invoice mismatches did not apply where the discrepancy arose solely from comparing current-year GSTR-3B with current-year GSTR-2A, without any supplier reporting default. The disputed ITC demand, related interest, and penalty were quashed.
TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =