LATEST GST CASE LAWS: 24.07.2025
🔥📛 Delhi HC to examine tax liability of re-insurance services availed by Oriental-Insurance pre Jan-2018
➡️ Oriental Insurance has challenged the imposition of GST on reinsurance services availed between July 1, 2017, and January 24, 2018, arguing that these transactions pertain to risk-sharing arrangements and were not intended to be taxed under GST during this transitional phase post-GST rollout. The petitioner contends that the services fall outside the scope of supply subject to GST, especially considering the ambiguity in legal provisions at the time.
➡️ Acknowledging the Revenue’s request for time to seek instructions, the Delhi High Court has not issued a ruling but has listed the matter for further hearing on August 7, 2025, indicating that interpretational clarity on GST applicability to reinsurance during the early GST regime is still under judicial consideration.
✔️ Delhi HC – Oriental Insurance Company Limited vs Additional Commissioner, CGST, Delhi North and Anr [W.P.(C) 10171/2025]
🔥📛 SC: Upholds Assessee’s right to avail copy of detention-order issued u/s-129(3), overturns HC judgment
➡️ The Supreme Court set aside the Allahabad High Court’s decision that denied the assessee the right to obtain a copy of the detention order issued under Section 129(3) of the CGST/UPGST/IGST Acts.
➡️ The Court emphasized that the assessee must be given an opportunity of hearing, and the Revenue is obligated to pass a reasoned and final order under Section 129(3), ensuring due process is followed.
➡️ The Supreme Court directed the Revenue to upload the final order within one month, reinforcing the procedural obligation and accountability under GST law.
➡️ The High Court had held that once payment is made via Form DRC-03 and proceedings are deemed concluded under Section 129(5) and Rule 142(3), no further direction (mandamus) could be issued—this interpretation was rejected by the Supreme Court.
➡️ The judgment reinstates the assessee’s right to access documents and contest proceedings, underlining that payment alone does not preclude the right to a copy of the detention order or a final adjudicatory order under Section 129(3).
✔️ SC – ASP Traders vs. State of U.P. & Ors. [SLP(C) No. 17995/2022]
🔥📛 Delhi HC in challenge to refund-denial on educational services, seeks affidavit on receipt from ‘foreign university’
➡️ In the absence of a functioning GST Appellate Tribunal, the Revenue approached the Delhi High Court under writ jurisdiction to challenge the Appellate Authority’s refund order favoring the Assessee.
➡️ The Revenue contended that the lower authorities failed to examine whether the Assessee, engaged in providing educational consultancy services, actually received consideration in foreign exchange as claimed, and whether the agreement terms supported the refund.
➡️ The Assessee referred to a coordinate bench decision of the Delhi HC in its own earlier case where similar refunds for previous years were upheld, arguing against Revenue’s plea to stay the current refund.
➡️ The High Court emphasized that timely refunds are essential for business operations and once upheld by the Appellate Authority, such refunds cannot be indefinitely delayed.
➡️ The Court directed the Commissioner (Refunds) to calculate the full refund amount in line with the Appellate Authority’s order by 31st August 2025, and required both parties to file affidavits with evidence (invoices and FIRC copies) confirming receipt of foreign exchange. The matter is listed for further hearing on 9th September 2025.
✔️ Delhi HC – Commissioner of Delhi, Goods and Service Tax, DGST Delhi vs Global Opportunities Private Limited [W.P.(C) 10189/2025]
🔥📛 HC: Assessee’s inadvertence to offset surplus credit against tax-demand is not suppression; Remands matter
➡️ The Gujarat High Court disposed of the assessee’s writ petition challenging an order passed under Sec. 74 of the CGST Act, directing the Revenue to initiate a fresh de-novo assessment under Sec. 73. This allows the assessee an opportunity to avail the amnesty benefits under the newly introduced Sec. 128A.
➡️ The assessee had an outstanding tax liability of approx. ₹51.12 lakhs for FY 2019–20 but possessed surplus ITC, which was belatedly offset in January 2023 after being pointed out during departmental audit. The delay was attributed to inadvertence rather than intent.
➡️ Despite offsetting the tax liability and voluntarily paying the penalty, the department issued a notice under Sec. 74 for interest under Sec. 50 and additional penalty. The assessee contested this, highlighting the existing surplus ITC balance and lack of intent to evade tax.
➡️ The Court found no evidence of suppression or wilful misstatement by the assessee. It acknowledged that the only lapse was the failure to timely offset the available credit against the tax liability, which did not warrant penal proceedings under Sec. 74.
➡️ Given the nature of the lapse and recent policy changes, the Court directed reassessment under Sec. 73 to facilitate the assessee’s eligibility under Sec. 128A, in line with the proviso to Sec. 128A(1), the 53rd GST Council Meeting, and Circular No. 238/32/2024-GST dated 15.10.2024.
✔️ Gujarat HC – Bhavani Tractor vs Union of India and Others [R/SPECIAL CIVIL APPLICATION NO. 13787 of 2024]
🔥📛 HC set aside order as SCN lacked details of date, time, and venue of personal hearing
➡️ The Show Cause Notice (SCN) issued to the assessee did not specify the date, time, or venue for personal hearing, rendering the opportunity for hearing ineffective and violating principles of natural justice.
➡️ Merely uploading documents or proceedings on the GST portal is not a valid substitute for proper service. Registered entities cannot be expected to monitor the portal daily for updates from the department.
➡️ As per Section 169 of the CGST Act, service of notices or decisions must follow at least two specified modes. In this case, non-compliance with these mandatory provisions invalidated the communication.
➡️ The department’s failure to offer a personal hearing, despite its statutory requirement under Section 75(4), was held to be a significant procedural lapse affecting the validity of the proceedings.
➡️ Due to the procedural lapses, the court set aside the impugned actions and directed the competent authority to schedule a personal hearing with clear communication of the date, time, and venue, ensuring adherence to legal provisions.
✔️ Patna HC – Shree Shyam Trading Co. v. Union of India [Civil Writ Jurisdiction Case No. 5661 of 2025]
🔥📛 HC set-aside order as reply to SCN wasn’t considered by rejecting case of assessee with standard one-line observation
➡️ The adjudicating authority passed a demand order post-show cause notice without properly considering the assessee’s reply and without granting a personal hearing, despite a specific request. This amounts to a breach of principles of natural justice.
➡️ The assessee’s detailed reply was dismissed with a mere one-line rejection, showing that the authority failed to engage with or evaluate the substantive contentions raised in the response.
➡️ Given the procedural lapses, the impugned demand order was set aside. The court directed that a fresh, reasoned order be passed within three months after due consideration of the assessee’s reply and after granting a proper hearing.
➡️ The assessee challenged the validity of CBIC Notifications No. 56/2023 and 09/2023, which extended timelines for demand proceedings under GST. This raised questions on the legal sustainability of such retrospective extensions.
➡️ As a similar issue regarding the validity of time-limit extension notifications is pending before the Supreme Court (HCC-SEW-MEIL-AAG JV v. Asstt. Commissioner, SLP No. 4240 of 2025), the current proceedings will be subject to the outcome of that decision.
✔️ Delhi HC – RSA Impex LLP v. Commissioner of DGST [W.P.(C) No. 9114 of 2025]
🔥📛 Refund to be granted with statutory interest since deficiency memo issued in response to refund claim was untraceable: HC
➡️ Although the final refund rejection order was passed in September 2019, the assessee only became aware of it in February 2025 during writ proceedings. The court held that appeal rights under Section 107 of the CGST Act remain intact despite this delay, and the assessee must be allowed to file an appeal.
➡️ The court emphasized that procedural delays or lack of communication should not deprive a taxpayer of the statutory right to challenge adverse orders. The petitioner’s remedy through appeal cannot be shut out due to lack of timely service of the order.
➡️ In a separate refund claim case, the Department failed to produce a copy of a deficiency memo that allegedly halted the refund process. The absence of this critical document meant the Department had no valid ground to withhold the refund.
➡️ The court held that where the Department cannot substantiate its claims (e.g., by failing to produce deficiency memos), the taxpayer cannot be penalized. Refunds must be processed based on the original valid application.
➡️ The court directed the Department to refund the amount within two months along with statutory interest, calculated from the original date of application, reinforcing the principle that taxpayers are entitled to compensation for undue delay.
✔️ Delhi HC – Sisla Laboratories v. Deputy Commissioner of CGST [W.P.(C) No. 11287 of 2023]
🔥📛 Demand can’t be raised beyond amount specified in SCN; matter to remanded back: HC
➡️ The adjudicating authority issued a demand of ₹41,84,920 despite the show cause notice (SCN) specifying a proposed demand of only ₹23,69,062, which is contrary to Section 75(7) that prohibits raising a demand beyond what is stated in the SCN.
➡️ Section 75(7) also restricts authorities from confirming demands on grounds not mentioned in the original SCN. In this case, the enhanced demand was not based on any new SCN or additional grounds, thus violating this statutory requirement.
➡️ Although the petitioner failed to respond to the SCN and a subsequent reminder notice, this procedural lapse by the assessee did not authorize the department to exceed the scope of the original notice.
➡️ Given the breach of Section 75(7), the court remanded the matter back to the adjudicating authority with directions to provide the assessee an opportunity to file a reply and be heard before passing a fresh, lawful order.
➡️ This case reinforces the principle that tax authorities must strictly adhere to the limits of SCNs and cannot impose additional liability without issuing a revised or supplementary notice, ensuring transparency and due process.
✔️ Allahabad HC – Shri Ram Trading Company v. State of U.P. [WRIT TAX No. 3043 of 2025]
🔥📛 HC allows transfer of unutilized ITC from transferor company to amalgamated company registered in different state
➡️ Neither Section 18(3) of the CGST Act nor Rule 41 of the CGST Rules restrict the transfer of unutilized ITC during mergers or amalgamations across different States or Union Territories.
➡️ The system-generated restriction—“Transferee and Transferor should be of the same State/Union Territory”—was found inconsistent with the law, as the GST framework allows ITC transfer upon reconstitution of business, regardless of geographical boundaries.
➡️ When a business undergoes amalgamation or merger, the transferee entity inherits both the assets and liabilities—including ITC—from the transferor, even if the transferor ceases to operate post-merger.
➡️ While IGST and CGST from the transferor’s electronic ledger can be transferred to the transferee in another State, SGST cannot be transferred across States to protect the originating State’s revenue interest.
➡️ The court held that the transferee company has a legitimate right to claim and utilize the IGST and CGST balances of the transferor company in its own electronic credit ledger, ensuring continuity of tax credits post-amalgamation.
✔️ Bombay HC – Umicore Autocat India (P.) Ltd. v. Union of India [WRIT PETITION NO. 463 of 2024]
