This Annual Case Digest analytically summarizes the key stories related to Tax judgements of various High Courts in India reported in Taxsca.in during the year 2023. These stories include judgements and observations of High Courts related to Income Tax, Goods and Service Tax(GST), Excise Duty, Service Tax, Customs Duty, etc.
The Punjab and Haryana High Court directed to consider Reinstatement of Police Acquitted in Unlawful Activity (Prevention) Act, 1967 (UAPA) Case and observed that UAPA and Prevention of Money Laundering Act, 2002 (PMLA) cannot be Invoked by Writing letter from SSP.
“It comes out that the petitioners on the same set of allegations were subjected to departmental as well as criminal proceedings. They were subjected to these proceedings along with other police officials. All the police officials were subjected to same punishment in the departmental proceedings and all the police officials have been acquitted in the criminal proceedings. Few of police officials after their acquittal have been reinstated” the Court concluded.
The Allahabad High Court has ruled that the onus is on the Income Tax Department to prove that investments made through banking channels is doubtful.
A Division Bench comprising Justices Shiv Shanker Prasad and S. D. Singh observed that “Prima facie, in face of investment made through banking channel which according to learned counsel for the revenue was duly disclosed in the regular returns of the investing entities, there does not exist any presumption or room to disbelieve the investment made in the assessee company.” “The burden to prove otherwise rested squarely on the revenue authorities. Unless the initial onus had been discharged by leading some evidence that may have led itself to the conclusion that the investment was never made, the burden that was cast on the revenue remained undischarged.”
The Delhi High Court directed to decide revocation of cancelled GST Registration as there was discrepancy in input tax credit (ITC) claim due to cancellation of GST registration with retrospective effect.
A Division Bench of Justices Vibhu Bakhru and Amit Mahajan observed that “Discrepancy in the Input Tax Credit claimed by the petitioner was not the ground on which the petitioner’s GST registration was cancelled. The petitioner claims that it is handicapped in responding to the communication dated 04.09.2003, and reconciling the Input Tax Credit Claim for more than three financial years, in absence of full access to its GST Portal. This access is unavailable as the petitioner’s GST registration has been cancelled with retrospective effect.” “We consider it apposite to direct that the concerned officer shall decide the petitioner’s application for revocation of the cancellation order after examining all aspects as to whether the petitioner was existent at its principal place of business at the material time” the Court concluded.
The Punjab and Haryana High Court ordered the release of Chandigarh Pharma firm directors arrested by the Enforcement Directorate (ED).
“The petitioners be released from judicial custody, but subject to theirs furnishing personal, and, surety bonds in the sum of Rs.5,00,000/- each, before the trial Court/Chief Judicial Magistrate/Duty Magistrate concerned, and, to his satisfaction, and, also subject to theirs not tampering with prosecution evidence, and, also theirs not influencing prosecution witnesses” the Court concluded.
A Single Bench of Madras High Court has remanded the Input Tax Credit (ITC) Claim of Assessee owing to cash crunch that led the assessee to file GSTR-3B and GSTR-2 belatedly and in offline modes, while the same was rejected for belated filing.
The Madras High Court’s observation regarding the hindrance created by the absence of an option to file incomplete GSTR-3B online highlights the need for improvements in the GSTN infrastructure. The suggestion that the GST Council should address these practical difficulties and consider allowing manual filing until online options are optimized adds a policy dimension to the judgment.
The Karnataka High Court directed the Bruhat Bengaluru Mahanagara Palike (BBMP) to digitise and credentialize khata certificates, tax receipt with QR Code for E-Verification.
“The Chief Commissioner, BBMP along with the Principal Secretary, E-governance, as also the concerned of digi-locker are directed to look into the matter and formulate a suitable mechanism to credentialize all documents issued by the BBMP so these situations can be avoided. Necessary report in this regard is to be filed within a period of four weeks from today.” The Court directed.
A Division Bench of the Delhi High court set aside the cancellation of the petitioner’s GST registration and instructed the GST department to amend the registration cancellation order to nullify the arbitrary exercise of retrospective cancellation.
The Delhi High Court Division Bench of Justice Amit Mahajan and Justice Vibhu Bakhru thus instructed the GST department to amend the cancellation order bearing retrospective cancellation of GST registration. The petitioner was represented by Dinesh Mohan Singha, Wakil Kumar and Rajiv Deora.
A division bench of the Chattisgarh High Court held that the provision outlined in Section 16(4) of the Central Goods and Services Tax Act, 2017 does not infringe upon either Article 14 or Articles 19(1)(g) & 300A of the Constitution, thus upholding the constitutional validity of the same.
The bench held that the petitioner has not presented a compelling case to challenge the constitutional validity of Section 16(4) of the Central Goods and Services Tax Act, as it stands as a constitutionally sound piece of legislation. The bench asserted that the provision outlined in Section 16(4) of the Central Goods and Services Tax Act does not infringe upon either Article 14 or Articles 19(1)(g) & 300A of the Constitution. The bench Chattisgarh High Court Division Bench consisted of Justices Radhakrishnan K Agarwal and Sanjay K Agarwal. The petitioner was represented by Palash Soni and the revenue was represented by Deputy Solicitor General of India Ramakant Mishra and Anmol Sharma.
The Delhi High Court directed the Income Tax Department to file for revival of appeal as the tax effect was less than prescribed threshold.
A Division Bench of Justices Rajiv Shakdher and Girish Kathpalia observed that “Given the fact that in the period in issue i.e., AY 2011-12, the expense claimed was only Rs.1,89,24,472/-, in our opinion, the tax effect would be less than the prescribed threshold i.e., Rs. 1 crore. Given this position, the appeal is closed with liberty to the appellant/revenue to approach the court, for revival of the appeal, if they receive instructions to the contrary.”
A Single Bench of the Delhi High Court has upheld the guilty verdict on a Chartered Accountant (CA) delivered by the Disciplinary Committee of the Institute of Chartered Accountants of India (ICAI) on allegations of Cheque Forgery and usage of tax money of clients for personal purposes.
In view of the same, the Delhi High Court held that, “Keeping in mind the seriousness of allegations against the Petitioner which have been proved in the proceedings, this Court is not inclined to interfere with the judgment passed by the Appellate Authority.”
The Kerala High Court directed the State Tax Officer to decide objection as the notice was issued under Section 66 of the Kerala Value Added Tax Act, 2003 (KVAT).
A Single Bench of Justice CS Dais observed that “Having considered the pleadings and materials on record and taking note of the fact that the petitioner has already submitted objection before the first respondent, I deem it appropriate to direct the first respondent to consider and dispose of the objection before enforcing the notices.”
The Delhi High Court set aside cancellation of GST Registration on the ground of violation of natural justice principles.
A Division Bench of Justices Vibhu Bakhru and Amit Mahajan observed that “We are of the view that the said show-cause notice is bereft of the necessary particulars so as to enable the petitioner to respond to the same with any clarity. Further, the petitioner was not afforded any opportunity of being heard. This is because, even though the show-cause notice called upon the petitioner to appear for a personal hearing, it did not specify the date, time or the venue of such hearing.” “Although the petitioner has not approached this Court immediately after receiving the impugned order, we do not find that the delay is pernicious to the petitioner’s claim for restoration of the GST registration. As is apparent from the above, the impugned order cancelling the petitioner’s registration was passed in violation of the principles of natural justice and is, thus, liable to be set aside. The impugned order, cancelling the petitioner’s GST registration is set aside.” the Court concluded.
In a recent decision the Delhi High Court ruled that the Enforcement Directorate (ED) is exempt from disclosing information under Section 24 of the Right to Information Act, 2005 (RTI).
A Single Judge Bench of Justice Prathiba M Singh observed that “As can be seen from the above judicial precedents, the consistent view has been that the IB, ED and DRDO are considered to be exempted organizations as per Section 24 of the RTI Act, 2005.”
Bollywood Actress Jacqueline Fernandez has moved to the Delhi High Court for quashing the FIR lodged against her in the Enforcement Directorate’s (ED) Rs 200 crore money laundering case.
The petition, is likely to come for hearing during the week, has also sought to quash the second supplementary charge sheet filed by the ED in the case and related proceedings pending before a trial court in Delhi.
In a recent decision, the Delhi High Court observed that the effect of cancellation of GST is from the date of the closure of the business.
A Division Bench of Justices Vibhu Bakhru and Amit Mahajan observed that “the impugned order is required to be set aside, however, we do not consider it apposite to do so since the petitioner’s prayer is limited. She prays that her GST registration be cancelled with effect from 11.11.2019 as the petitioner had stopped her business from the said date. In view of the above, we direct that the impugned order cancelling the petitioner’s GST registration would take effect from 11.11.2019 and not from 01.07.2017.”
The Calcutta High Court set aside the order confirming penalty Reversal of Income Tax Credit (ITC) availed under West Bengal Goods and Services Tax Act, 2017 (WBGST Act).
A division bench of Chief Justice T S Sivagnanam and Justice Hiranmay Bhattacharyya set aside the writ petition and set aside the order passed by the first respondent namely the Assistant Commissioner, State Tax, Ballygaunge Charge, with a direction to the appropriate authorities to first proceed against the fourth respondent and only under exceptional circumstance as clarified in the press release issued by the Central Board of Indirect Taxes and Customs (CBIC), then and then only proceedings can be initiated against the appellant.
The Delhi High Court directed to allow Goods and Service Tax(GST) Refund since the FORM GST DRC-04 under Central Goods and Service Tax (CGST) rules, 2017.It is not disputed that any voluntary deposit in Form GST DRC-03 is to be followed by an acknowledgement accepting the payment as being voluntarily made by issuance in Form GST DRC04.
A division bench of Justice Vibhu Bakhru and Justice Amit Mahajan observed that “since the deposit made by the petitioner has been held to be involuntary and the respondents are directed to forthwith process the petitioner’s claim for refund, we do not consider it apposite to adjudicate other issues raised by the petitioner. “ “It is also clarified that the respondents are not precluded from taking any other necessary steps in accordance with law. The Department is also not precluded from passing appropriate order including any order under Section 83 of the CGST Act, for protecting the interest of the Revenue in accordance with law, if the conditions for passing such orders are satisfied. “, the Court concluded.
In a significant case on the allegation of Bogus import of service through the Cash Bean app, the Delhi High Court dismissed a writ appeal on evidence to prove contravention in the Foreign Exchange Management Act,1999.
It was found that the petitioner has been unable to make out such a case which would warrant an interference of the Court with the Impugned Order. “The allegations of the respondents and the defence of the petitioner would need to be tested by the Adjudicatory Authority. On facts, it cannot be said that the respondents’ action is ultra vires the Act or so whimsical as to warrant the interference of the Court at this stage when the proceedings are pending before the Adjudicatory Authority.”, the court held.
Read The division bench of the Kerala High Court has stayed the recovery proceedings under the Income Tax Act, 1961 till the disposal of statutory appeal.
A division bench of the Dr Justice A K Jayasankaran Nambiar & Dr Justice Kauser Edappagath modified the order to the limited extent of clarifying that pending disposal of the stay petition or appeal, whichever is earlier by the appellate authority, the recovery proceedings against the appellant for recovery of the amounts confirmed against it by order shall be kept in abeyance.
In a major relief to Travelport LP USA, the Delhi High Court dismissed the plea of the department against attribution of only 15% of revenue assessable to the Permanent Establishment (PE) in India by the Commissioner of Income Tax (Appeals) [CIT(A)].
The bench of Justice Rajiv Shakdher and Justice Girish Kathpalia also noted that, “Furthermore, the appellant’s/revenue’s plea that the provisions of Section 144C of the Act would come into play was repelled by the Tribunal for the reason that framing a draft assessment order was not required for the periods in issue, and therefore, the non-obstante clause under Section 144C of the Act would not override Section 153 of the Act.” It was thus held that, “Since on merits the matter stands closed, in our view, these appeals need not be entertained vis-à-vis the questions proposed by the appellant/revenue as they have, in a sense, been rendered academic.” Consequently, the Delhi High Court dismissed the appeals, being infructuous, on both merits and on limitation.
The Kerala High Court directed to approach competent authority as the one-time settlement of tax was due on tipper.
A Single Bench of Justice Dinesh Kumar Singh observed that “Considering the said prayer, the present writ petition is disposed of with liberty to the petitioner to file an application within a period of seven days from today to the concerned competent authority for one time settlement of tax due on the said vehicle. If such an application is filed, the competent authority should take decision on the said application for one time settlement of tax liability of the petitioner. For a period of one month, the impugned recovery notice Ext.P4 shall not be enforced.”
The Kerala High Court dismissed the writ petition on the availability of alternate remedy of appeal should be resorted even if original authority has erred on law under the Kerala Value Added Tax Act, 2003 (KVAT Act).
A Single Bench of Justice Dinesh Kumar Singh observed that “I find a little substance in the submission of the learned Counsel for the petitioner that there was violation of the principles of natural justice or the petitioner was not afforded with adequate opportunity of hearing. The facts as noted above would disclose that the petitioner was issued notices twice and the authorised representative was heard. But, he only submitted that the assessment proceedings were time barred and he did not addressed the issue on merits or produced any materials.” “It is well settled that when there is an alternative remedy of appeal provided even if the original authority has erred on law, the remedy against the order is to file an appeal under the statute and the writ petition before this Court. Hence, I find no ground to entertain this writ petition and it is hereby dismissed” the Court concluded.
The Kerala High Court directed the Transport Department to take proper decision as the arrears of tax including arrears of repayment of finance on vehicle was pending.
A Single Bench of Justice Dinesh Kumar Singh observed that “Let a proper decision be taken on the prayer of the petitioner within a period of four weeks from the date of submission of the judgment passed in the writ petition. With the aforesaid direction, the writ petition stands finally disposed of.”
The Delhi High Court has recently quashed a First Investigation Report (FIR) lodged against and determined that an Insolvency Resolution Professional (IRP) does not fall under the definition of a “public servant” as outlined in Section 2(c) of the Prevention of Corruption Act, 1988.
In view of the above and in the considered opinion of this Court, an Insolvency Professional does not fall within the meaning of “public servant” as ascribed in any of the clauses of sub-section (c) of section 2 of the Prevention of Corruption Act, 1988. Resultantly, the FIR registered by the respondent CBI was quashed and set aside.
The Kerala High Court directed the Assessing Authority to redetermine tax in the matter that the TCS collected by dealer not includable in purchase value of vehicle.
A Single Bench of Justice Dinesh Kumar Singh observed that “In view of the above, the present writ petition is also allowed in terms of the judgment dated 2.8.2023 in Paulose K.V. Hence, the demand notices impugned herein are hereby set aside and the assessing authority may redetermine the tax, if it so required, in the light of the observations made by this Court in Paulose K.V.”
The Kerala High Court dismissed writ petition as the application for condonation of delay after 6 years from end of the assessment year.
“I also do not find any substance in the challenge made to the Circular, dated 9.6.2015, which has been issued by the Central Board of Direct Taxes prescribing the procedure and limitation in exercising the power for condoning the delay. It is well within the power of the Board to prescribe the time limit for filing the application for condonation of delay. In view thereof, I find that the argument challenging the Circular has no merit” the Court concluded.
In a major setback to IndusInd Bank, the Delhi High Court has held that Sale of repossessed vehicles attract Value Added Tax (VAT).
Citing precedents, the bench observed that, “The controversy regarding levy of tax on the sale of re-possessed is squarely covered by an earlier decision of the Coordinate Bench of this Court, of which one of us (Vibhu Bakhru, J) was a member, in M/s Citi Bank v. Commissioner of Sales Tax M/s Citi Bank v. Commissioner of Sales Tax: ST. REF. 1/2003, decided on 14.12.2015. The said decision was rendered in the context of the Delhi Sales Tax Act, 1975. However, in a later decision in HDFC Bank v. Commissioner of Value Added Tax, Delhi: VAT APPEAL 29/2016, another Coordinate Bench of this Court had, following the decision of M/s Citi Bank v. Commissioner of Sales Tax M/s Citi Bank v. Commissioner of Sales Tax (supra), rejected an appeal against the decision of the VAT Tribunal holding that sale of such re-possessed vehicles was subject to the charge of VAT. The said two decisions cover the petitioner’s challenge to the impugned notices demanding VAT, interest, and penalty under the DVAT Act.” In result, the petition being unmerited, was dismissed by the Delhi High Court, holding that the sale of repossessed vehicles attract Value Added Tax.
The Madras High Court observed that personal hearing is mandatory under Section 75 (4) of the Goods and Services Tax (GST) Act, even if otherwise opted for.
Justice Krishnan Ramaswamy observed remitted the matter to the relevant authority for reconsideration, emphasizing a detailed order in line with the law, after considering the reply and providing the petitioner with a personal hearing opportunity. The court agreed to the suggested personal hearing date of 12.12.2023 or any other date set by the respondents, communicated in writing to the petitioner. The writ petition was allowed without costs, and the connected Miscellaneous Petition was closed.
The Allahabad High Court has held that Form 10 under Income Tax Rules, 1961 supplied after limitation but before completion of assessment has to be considered.
A division bench comprising Justice Siddhartha Varma and Justice Shekhar B. Saraf observed that Form-10 under Rule 17 of the Rules is required to be filed before the Assessing Officer before he completes the assessment. In a case, where Form-10 is filed late but is filed before the Assessing Officer completes the assessment, the benefit of Section 11(2) of the Act shall be available to the assessee. The Court held that the
entire process of reassessment that has been initiated by the Department holds no water and is without any legal basis whatsoever. The court quashed the notice issued under Section 148 of the Act, the order passed rejecting the objection of the petitioner dated March 3, 2022, and the reassessment order passed by the Assessing Officer on March 19, 2022.
The Karnataka High Court has nullified a demand notice issued by the Bruhat Bengaluru Mahanagara Palike (BBMP) for retroactive property tax payments dating back to 2008. The court’s decision, delivered by Justice Suraj Govindaraj in response to a petition filed by M/s B M Habitat, centered on the argument that the building had been completed before the Occupancy Certificate was issued on 25.04.2011.
In a recent ruling, the Kerala High Court Justice Dinesh Kumar Singh directed M/S. N.T.K. Jewellers to file a statutory appeal against the Goods and Services Tax (GST) Adjudication Notice after finding no reason to believe in the improper service of GST DRC-01 notice.
Concluding the judgement, Justice Dinesh Kumar Singh disposed of the writ petition, granting the petitioner the liberty to file an appeal against the order issued by the Deputy Commissioner of State Tax. The court also noted the extension of the appeal limitation until January 31, 2024, as per Circular No.53/2023.
The Kerala High Court has ruled in favour of the assessees, in a customs case where the gold seized were not released despite favorable ruling in the order-in-original.
The Single Bench of the Kerala High Court also clarified that the release is contingent upon the outcome of any appeal filed by the Customs Department against the original orders. The court’s emphasis on a time-bound release and acceptance of alternative securities sets a notable standard for similar cases in the future.
The Delhi High Court quashed the proceedings against the petitioner assessee, as the inspection under the Goods and Service Tax Act, 2017 as per the order of the special judge was without conducting any prior investigation.
A division bench comprising Justice Vibhu Bakhru and Justice Amit Mahajan “The GST authorities are not precluded from continuing or initiating proceedings by the provisions of the CGST Act. Thus, if any information is available with the Department that requires an inquiry to be conducted against the petitioners, the respondent authorities are not impeded to do so. However, we clarify that no further inquiries or action is required to be conducted or taken by the GST authorities, for complying with the order dated 05.04.2023 passed by the Special Judge.”
In a significant case on the allegation of Bogus import of service through the Cash Bean app, the Delhi High Court dismissed a writ appeal on evidence to prove contravention in the Foreign Exchange Management Act,1999.
It was found that the petitioner has been unable to make out such a case which would warrant an interference of the Court with the Impugned Order. “The allegations of the respondents and the defence of the petitioner would need to be tested by the Adjudicatory Authority. On facts, it cannot be said that the respondents’ action is ultra vires the Act or so whimsical as to warrant the interference of the Court at this stage when the proceedings are pending before the Adjudicatory Authority.”, the court held.
The Delhi High Court penalty under section 271(1)(c) of the Income Tax Act, 1961 is impossible only when the furnishing of inaccurate particulars was proven. It was viewed that a case is made out under Section 271(1)(c) of the Act, he needs to indicate, clearly, as to which limb of the said provision is attracted.
A division bench comprising Justice Rajiv Shakdher and Justice Girish Kathpalia observed that a case is made out under Section 271(1)(c) of the Act, he needs to indicate, clearly, as to which limb of the said provision is attracted. The reason we say so is, that apart from anything else, the pecuniary burden may vary, depending on the infraction(s) committed by the respondent/assessee. The Court closed the appeal.
In a recent decision the Delhi High Court observed that the Commissioner of Income Tax (CIT) has no role in extending timeframe as Assessing Officer (AO) was in seisin of assessment proceedings.
A Division Bench comprising Justice Rajiv Shakdher and Justice Girish Kathpalia observed that “The legal tenability of the decision taken in the matter depends on which specified authority was invested with the power to extend the timeframe. As discussed above, since the legislature vested the discretion to extend the timeframe solely in the AO, he could not haveabdicated that function and confined his role to only making a recommendation to the CIT. The CIT had no role in extending the timeframe as the AO was in seisin of the assessment proceedings.”
The Delhi High Court quashed an income tax notice issued prior to date of approval of resolution plan.
A Division Bench comprising Justices Girish Kathpalia and Rajiv Shakdher observed that “The impugned notices and orders were issued by the respondents/revenue admittedly subsequent to the public announcement under Section 15 of the Code regarding CIRP process pertaining to the petitioner/assessee. The public announcement under Section 15 of the Code called for submission of claims by 21.01.2019, but the respondents/revenue did not file any claim till that date or even thereafter; it is only subsequent to approval of the Resolution Plan vide order dated 05.11.2019 of the Tribunal.” “The argument on behalf of respondents/revenue that being the State exchequer, it cannot be bound by the Resolution Process provisions of the Code has been recorded only to be rejected in view of the above quoted extract from the judgment in the case of Ghanshyam Mishra” the Court concluded.
Quashing an income tax appeal, the Delhi High Court confirmed that the CIT(A) cannot extend time based on recommendation of the Assessing Officer (AO).
A Division Bench Comprising Justices Rajiv Shakdher and Girish Kathpalia observed that “Accordingly, for the reasons recorded in the judgment rendered in ITAs 526/2023 and 568/2023, the questions of law, as framed, are answered against the appellant/revenue and in favour of the respondent/assessee. The appeals are disposed of, in the aforesaid terms.”
In a significant ruling the Delhi High Court observed that a non- resident Indian having source of income in India from interest on bank accounts and income tax refund not obliged to maintain books of account in India.
A Division Bench comprising Justices Girish Kathpalia and Rajiv Shakdher observed that “In the present case, the respondent/assessee is a NonResident Indian and his source of income in India being from interest on bank accounts and interest on income tax refund, he is not obliged to maintain any books of account in India.” “In the impugned order, the Tribunal meticulously examined and elaborately discussed the documentary record in support of the said explanation of money ingress in the bank account of the respondent/assessee. In the absence of a stand taken by the appellant/revenue alleging perversity, this court while acting under Section 260A of the Income Tax Act cannot enter into the arena of appreciation of facts and documents” the Court noted.
The Delhi High Court has held that no jurisdiction is vested in the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) to hear matters against orders of Commissioner of Appeals on Payments of Duty Drawback.
The Division Bench of Justice Amit Mahajan and Justice Vibhu Bakhru thus held that, “We are of the opinion that the appeal preferred by the Firm before the learned CESTAT was not maintainable and the order passed by the Tribunal is thus void ab initio.” Further, it was held that, “The question whether the learned CESTAT can pass the judgment in respect of a case falling under proviso (c) of Section 129A(1)(b) of the Customs Act is answered in the negative. Accordingly, the impugned order dated 02.11.2018 passed by the learned CESTAT is set aside.”
The Delhi High Court slammed Income Tax Department for late filing of appeal and commented that “No action is taken against officers who sit on files and do nothing under presumption that court will condone delay”.
“The appellant/revenue has failed to set up any circumstance to satisfy us that they were precluded from filing the present appeals in time by any cause beyond their control. We are unable to find any sufficient cause to condone this inordinate delay in filing these appeals after removal of filing defects. Consequently, there is no occasion to condone the delay in re-filing these appeals. Both applications are therefore, dismissed” the Court concluded.
The Kerala High Court, granting an interim relief to petitioner-exporter, stayed the recovery of refunded Integrated Goods and Services Tax under Rule 96(10) of Central Goods and Service Tax Rules, 2017.
In result, the Single Bench of Kerala High Court, on a consideration of the pleadings and materials on record, and taking note of the fact that this Court has passed interim orders in identical matters, I am of the view that the petitioner is entitled to the benefit of a similar order. Hence, the bench of Justice C S Dias, stayed further proceedings pursuant to the impugned order, for a period of four months.
The Kerala High Court has emphasized that officials are empowered to exercise arrest authority under Section 69 of the Kerala State Goods and Services Act, 2017, if there is a reasonable belief that an offense under Section 132 has been committed, and custodial interrogation is deemed necessary, while rejecting the bail plea of of an individual accused of evasion of tax to the tune of Rs. 6.4 Crore.
In light of ongoing investigations, the court dismissed the bail application, disregarding contrary views from other high courts and emphasizing that arrest power could be invoked when all conditions precedent in Section 132 of the Kerala Goods and Services Tax Act, 2017 were met.
The Kerala High Court denied relief for failure to produce document in a hasty assessment denying concessional Value Added Tax rates (VAT).
The division Bench of the Kerala High Court comprising Dr. Justice A K Jayasankaran Nambiar and Dr. Justice Kauser Edappagath observed that “the tax liability comes to more than `45,00,000/-. We find no illegality in the order of the 2nd respondent imposing a condition to grant stay. The appeal fails, and it is accordingly dismissed,” thereby dismissing the appeals.
The Bombay High Court has allowed a Goods and Services Tax (GST) taxpayer to rectify bonafide mistake in GST Form GSTR-1 beyond the stipulated time limit.
The revenue authorities were directed to permit the petitioner to amend / rectify the Form GSTR-1 for the period July 2021, November 2021 and January 2022, either through Online or manual means within a period of four weeks from the date of judgment.
The Calcutta High Court, reaffirming the prevalence of time limit conditions imposed on filing of Goods and Services Tax Returns over legal right to claim Input Tax Credit (ITC), upheld the constitutional validity of the Section 16(4) of the Central Goods and Services Tax Act, 2017.
The Calcutta High Court’s recent ruling on the overriding effect of ITC provisions over the time limit of filing returns marks a significant legal precedent. In upholding the constitutional validity of Section 16(4) of the Goods and Services Tax Act, the court has reaffirmed the importance of adhering to statutory time limits in claiming Input Tax Credit (ITC). In delivering its verdict, the Division Bench, comprising Chief Justice T S Sivagnanam and Justice Hiranmay Bhattacharyya, emphasized that ITC is a concession provided by the Act, not a matter of absolute right, and fulfillment of eligibility criteria is mandatory.
In a significant case, the Delhi High Court upheld the calculation at Arm’s Length of Reimbursement of advertising, marketing and promotion expenses (AMP) Expenses Incurred by Sony India on its Associated Enterprises (AE).
A division bench comprising Justice Rajiv Shakdher and Justice Girish Kathpalia observed that, in the period in issue, the respondent/assessee was only in the business of import and distribution of Sony products. The amount spent on AMP activities by the respondent/assessee in the relevant FY was Rs. 119,54,43,600/-. The compensation for the expense was received by the respondent/assessee in terms of higher profitability for the product sold. The TPO stated the AMP expenditure incurred by the respondent/assessee resulted in increased sales in India for products, albeit developed by the AE but sold by the respondent/assessee. The fact that the comparables chosen by the TPO had a net margin lower than that registered by the respondent/assessee would persuade us to hold that no upward adjustment concerning AMP expenses ought to have been made. The Court refused to interfere with the impugned order and dismissed the appeal.
The Patna High Court, in a significant move, has held the Goods and Services Tax (GST) appeal filed by payment of 10% pre-deposit from Electronic Credit Ledger (ECRL) maintainable.
The Patna High Court, in result, set aside the order in appeal dated 10.01.2023 and directed the appeal to be considered on merits. It was further made clear that the Commissioner, Commercial Taxes, Patna shall issue necessary directions for consideration of appeals when the subject matter is pending before the Supreme Court. There shall be no insistence for payment of the 10 percent due and payable under Section 107 of the GST Act, from the Electronic Cash Ledger. It was also noted that, “in the present case, already ten per cent of the
The Bombay High Court has directed the department to permit the petitioner or assessee to amend or rectify Form GSTR-1 for July 2021 either online or manually.
The division bench of Justice G. S. Kulkarni and Justice Jitendra Jain have observed that the State Tax officer ought to have granted the petitioner’s request to rectify/amend the Form GSTR–1 for the period July 2021, November 2021 and January 2022, either through Online or manual means.
In a recent case, the Delhi High Court directed the cancellation of Goods and Service Tax (GST) registration on the date of the application filed seeking cancellation of the registration. The writ petition was filed by the petitioner, Saroj Gagneja, challenging the order; the petitioner’s GST registration was canceled with retrospective effect. The petitioner was registered with the GST authority from 01.07.2017, conducting business as ‘M/s S. S. Enterprises,’ assigned a Goods and Service Tax Identification Number.
The bench observed that not filing returns after closing the business in January 2020 should not be grounds for canceling the registration during the compliant business period. The petitioner’s GST registration should not be canceled, as suggested by the show cause notice. The order revoking the registration lacked justification and was subject to being set aside.
After analyzing the facts and arguments, a division bench of Justice Vibhu Bakru and Justice Amit Mahajan directed the cancellation of Goods and Service Tax (GST) registration on the date of the application seeking cancellation.
Recently, the Bombay High Court has overturned the customs deputy commissioner’s decision that diverged from the ruling issued by the Authority of Advance Ruling (AAR).
The court underscored the assessee’s right to invoke writ jurisdiction under Article 226 of the Constitution, even with an alternative statutory remedy available. Grounds for invoking writ jurisdiction include breaches of fundamental rights, natural justice violations, orders passed without jurisdiction, or challenges to the statute’s vires.
The court determined that the department’s action, contrary to Section 28J provisions, lacked jurisdiction, rendering the Order in Original invalid.
The Bombay High Court has held that Customs Officers have no power to sell seized gold without following provisions under section 110 of the Customs Act, 1962.
A division bench comprising Justice G S Kulkarni & Justice Jitendra Jain declared that the action on the part of the Assistant Commissioner of Customs in disposing of selling the gold jewellery belonging to the petitioner’s subject matter of the present proceedings, is illegal and unconstitutional.
The Division bench of the Delhi High Court observed that the investigation conducted by the CBI concerning the Adani and Essar Group of Companies, among others, was conducted promptly.
The Delhi High Court held that no further action could be taken against the assessee, considering there is no additional evidence provided to support the allegations against the implicated companies.
The Kerala High Court observed that the Jurisdiction to consider application under Section 119(2)(b) of the Income Tax Act, 1961 is not vested with the Chief Commissioner of Income Tax as the refund claim was above 10 Lakhs
A Single Bench of Justice Dinesh Kumar Singh observed that “In the present case, the claim of refund is more than Ten Lakhs, and therefore, the jurisdiction to consider the application of the petitioner under Section 119(2)
The Karnataka High Court directed the Chartered Accountant (CA) Firm, the petitioner to pay 250000 rupees which is 25% of the total penalty imposed against non-payment of Service Tax due to Delayed Payment of Salary by KSFC. The 25% penalty was accepted to be paid by the petitioner itself in the affidavit submitted.
A division bench comprising Justice P S Dinesh Kumar and Justice V Srishananda observed that “Further, order imposing Rs.10,12,433/- as penalty under Section 78 of the Act, itself needs to be set aside, if there is a factual error, especially in the absence of department making an available copy of the letter issued by the KSFC. The affidavit filed by the Review Petitioner mentions that he is intending to put quietus by paying 25% of the penalty.
The Delhi High Court has ruled that deductions sought for expenses related to income other than gross income are not valid. The Delhi High Court has granted relief to Jite Shipyard Ltd.
“To be noted, one of us [Rajiv Shakdher, J.], was part of the bench that authored the judgment in Commissioner of Income-tax, Central 1, Chennai v. Chettinad Logistics (P.) Ltd. A special leave petition (SLP) filed by the appellant/revenue, against the said judgment, was dismissed by the Supreme Court on 02.07.2018, both on the grounds of delay and merits”, the Delhi High Court Division Bench of Justice Rajiv Shakdher and Girish Kathpalia observed.
The Delhi High Court set aside customs circular imposing discretion of adjudicating authority to impose conditions, being contrary to Section 110A of Customs Act, 1962.
A Division Bench comprising Justices Vibhu Bakhru and Amit Mahajan observed that “Paragraph 2 of the impugned Circular to the extent it curtails the discretion accorded to the adjudicating authority is set aside as being contrary to the Customs Act. The impugned order is set aside and the petitioner’s application for the provisional release of the goods is restored before respondent no.6. Considering that the goods involved are perishable, respondent no.6 is directed to decide the matter afresh and pass a speaking order within a period of four working days from date after hearing the petitioner”.
The Delhi High Court has ruled that the prior inspection by state Goods and Service Tax (GST) authorities is not a bar for concluding an ongoing investigation by Central Goods and Service Tax (CGST) officers.
The Delhi High Court in a significant ruling held that Section 115BBE of the Income Tax Act, 1961 cannot be held unconstitutional on ground that there is apprehension of misuse.
A Division Bench comprising Acting Chief Justice Manmohan and Justice Mini Pushkarna observed that “Consequently, at this stage, Section 115BBE of the Income Tax Act cannot be held unconstitutional on the ground that there is an apprehension of misuse of the said provision. Further, it is settled law that the Income Tax Act provides a complete machinery for assessment/re-assessment of tax and the assessee is not permitted to abandon that machinery to invoke jurisdiction of the High Court under Article 226 of the Constitution.”
The Kerala High Court quashed the assessment order passed under the Goods and Service Tax Act (GST Act), 2017 as the official copy of GST ASMT-10 or show cause notice (SCN) was not served.
A Single Bench of Justice Dinesh Kumar Singh observed that “In view thereof, I find that there is violation of the principles of natural justice and, therefore, the impugned assessment order, is unsustainable and the same is hereby set aside. The matter is remanded back to the file of the assessing authority, 1st respondent, to pass a fresh order. The petitioner is permitted to file a reply to the show notice dated 30.9.2023, within a period of three today.”
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