LATEST GST CASE LAWS: 07.08.2025
🔥📛 HC: Multiple notices qua same issue, period creates chaos; Quashes Goa’s SCN, where DGGI took cognizance
➡️ The Court held that issuance of multiple Show Cause Notices (SCNs) by different GST authorities (DGGI Mumbai and Dy. Commissioner, CGST Goa) for the same subject matter and period leads to procedural chaos and conflicting outcomes, and is therefore impermissible.
➡️ Since the DGGI, Mumbai initiated a pan-India investigation covering all locations including the Goa branch, the High Court emphasized that adjudication should rightfully rest with DGGI, not local officers, to avoid duplication.
➡️ The SCN issued by DGGI was already under challenge before the Karnataka High Court, which had granted an interim stay. Despite this, the Dy. Commissioner, CGST Goa proceeded to pass an adjudication order, which was deemed improper by the Bombay HC.
➡️ The assessee’s request to transfer the proceedings from the Dy. Commissioner to the DGGI (as the competent authority for nationwide investigation) was ignored, further supporting the Court’s finding of procedural irregularity.
➡️ The Court quashed the adjudication order passed by the Dy. Commissioner, holding that such action amounted to duplication and was legally unsustainable. It relied on the precedent of Kusum Ingots & Alloys Ltd. to reinforce that jurisdiction rests where proceedings were first initiated and stayed.
✔️ Bombay HC – HM Leisure vs Assistant Commissioner of CGST, Div. – 1 & 2 Ors. [WRIT PETITION NO. 236 OF 2025]
🔥📛 HC stays further proceedings under SCN as audit findings were finalized without considering assessee’s reply
➡️ An onsite audit was conducted, and an audit memo was issued. The assessee requested the basis and computation behind the memo before responding, highlighting the importance of transparency in audit findings.
➡️ Despite the assessee’s request and subsequent detailed reply, the CGST department finalized the audit report and issued a show cause notice (SCN) before considering the reply, raising procedural concerns.
➡️ Rule 101(4) uses both permissive (‘may inform’, ‘may reply’) and mandatory (‘shall consider’) language. The court emphasized that once a reply is given by the assessee, the department must consider it before finalizing the audit report.
➡️ Finalizing the audit report without awaiting or considering the assessee’s reply constitutes a procedural lapse and a violation of Rule 101(4), which could impact the validity of the SCN.
➡️ Given the legal interpretation required on the application of Rule 101(4), the court deemed it appropriate to stay further proceedings under the impugned show cause notice until the issue is resolved.
✔️ Delhi HC – Dhruv Medicos (P.) Ltd. v. Deputy Commissioner Central GST, Delhi [W.P. (C) No. 10213 of 2025]
🔥📛 Demand order passed without hearing on enhanced SCN claim as compared to pre-SCN intimation to be set aside: HC
➡️ The department enhanced the tax demand significantly in the show cause notice (SCN) compared to the pre-SCN intimation (Form DRC-01A) without prior explanation, thereby breaching principles of natural justice.
➡️ The assessee was denied the legal opportunity to respond to the pre-SCN intimation, which could have potentially averted the SCN proceedings under Section 73 of the CGST Act.
➡️ The sudden and substantial increase in demand at the SCN stage, without any forewarning or justification in the pre-SCN stage, was deemed procedurally unfair and legally unsustainable.
➡️ Since the department failed to provide adequate reasoning for the variation in demand, and bypassed the assessee’s right to reply at the initial stage, the SCN was held to be invalid.
➡️ The assessee was granted the right to treat the impugned demand order as a fresh show cause notice under Section 73, thereby allowing a fair opportunity to respond before any final liability is imposed.
✔️ Calcutta HC – Expo Gas Containers Ltd. v. Commissioner of State Tax [WPA 4248 of 2025]
🔥📛 Appellate authority has sufficient power to enquire into merits even if same was not considered by Adjudicating Authority: HC
➡️ The Appellate Authority possesses the legal competence to re-examine the entire case, including the merits and reasoning of the Adjudicating Authority, and is empowered to consider all relevant submissions and evidence.
➡️ The appellate mechanism exists to correct any procedural or substantive errors made by the Adjudicating Authority, including failure to consider the assessee’s reply adequately.
➡️ The High Court declined to modify its earlier order dated 18-03-2025, emphasizing that the appropriate recourse for the assessee was to approach the Appellate Authority rather than seek judicial review at this stage.
➡️ While the court entertained the assessee’s challenge to the validity of Notification No. 06/2020 dated 03-02-2020, it limited the scope of the matter to this issue only and not to the merits of the adjudication order.
➡️ Since the assessee had earlier challenged the same order before the Supreme Court and subsequently withdrew the case without liberty to return to the High Court, the High Court refused to reopen or modify its prior decision.
✔️ Delhi HC – Sonu Monu Telecom (P.) Ltd. v. Union of India [W.P. (C) No. 2926 of 2025]
🔥📛 Partner shall be liable even after retirement if same is not communicated in writing to competent authority: HC
➡️ Even after retirement, a partner remains liable for the firm’s GST dues unless proper statutory procedures are followed to relinquish that liability.
➡️ Under GST law, a retiring partner must inform the Commissioner in writing about their retirement. Failure to do so results in continued tax liability despite retirement.
➡️ The firm was assessed under Section 73 due to discrepancies in GST payment, triggering liability proceedings. This assessment remains enforceable against all partners if retirement was not duly notified.
➡️ The petitioner could not provide evidence of statutory intimation of retirement, hence could not escape liability. Mere claim of retirement, without due notification, holds no legal weight.
➡️ The court upheld the principle that procedural compliance is essential to limit liability. As the petitioner failed to comply, the writ petition challenging liability was dismissed.
✔️ P&H HC – Harvinder Singh v. State of Punjab [CWP-9172-2025]
🔥📛 Proceedings initiated by Central GST authorities after closure of proceedings by State GST authorities are valid: HC
➡️ The Central GST department had lawfully initiated proceedings against SECL by conducting an inspection under Section 67(1) of the CGST Act on 27-08-2021, which culminated in a Show Cause Notice (SCN) issued on 16-01-2023.
➡️ The proceedings by Central GST were specifically related to liability under RCM, and a memo demanding payment was appropriately issued as part of the enforcement action.
➡️ Despite the Central authority having already taken up the matter, the State GST department initiated parallel proceedings on the same issue and time period, including issuing a summary SCN and a formal SCN — actions beyond their jurisdiction in such cases under the CGST Act.
➡️ Recognizing the jurisdictional overreach, the State GST authorities later closed their proceedings, implicitly acknowledging that the matter was already under valid adjudication by the Central GST department.
➡️ Since the Central GST had initiated action first and the State proceedings were withdrawn, the Show Cause Notice issued by Central GST was not barred under Section 6(2)(b) of the CGST Act, which restricts parallel proceedings only when the other authority is already handling the matter.
✔️ Chhattisgarh HC – South Eastern Coalfields Ltd. v. Principal Commissioner, CGST [WA No. 494 of 2023]
🔥📛 Order set aside rejecting application for cancellation of GST registration due to lack of reasoning: HC
➡️ Tata Steel BSL Ltd. applied for cancellation of its GST registration due to the amalgamation of Bhushan Steel Ltd. with Tata Steel Ltd., in line with legal requirements following a corporate merger.
➡️ The application was rejected solely on the grounds that the Show Cause Notice (SCN) was allegedly not replied to, without examining the merits or providing any legal reasoning.
➡️ The rejection order was found to be defective—mislabelled as an “order rejecting application for registration” rather than for cancellation—and lacked any substantive explanation, reflecting procedural lapses.
➡️ The authority failed to consider the factual and legal implications of the amalgamation, indicating a complete non-application of mind in processing the cancellation request.
➡️ The court set aside the impugned order, emphasizing that in cases of merger or amalgamation, proper reasoning must be given for denying cancellation of GST registration and procedural propriety must be followed.
✔️ Delhi HC – Tata Steel Ltd. v. Government of NCT of Delhi [W.P.(C) No. 10289/2025]
