BACKGROUNDThe petitioner challenged an order in original passed under GST on the ground that the same was never validly served upon him. The respondents (Union of India and others) contended in their counter affidavit that the order was duly served — first, by uploading it on the GST common portal on 08.06.2023, and second, by dispatching it through Speed Post on 01.06.2023 to the address registered in the GST records.FACTSThe respondents, in support of their claim of valid service by Speed Post, produced the Dispatch Register and a photocopy of the receipt issued by the Postal Department showing dispatch. However, they failed to produce the Acknowledgement card, which is the document returned to the sender after the article is received by the addressee bearing the signature of the addressee or his representative. Further, the Department of Posts, Government of India, vide its communication dated 07.04.2026, informed the petitioner that there is no evidence of service of the said article upon the petitioner after it was dispatched by the respondents. The court also noted the earlier interim order dated 17.12.2025 already granted in favour of the petitioner.COURT OBSERVATIONS (Verbatim)"mere uploading of the order in the GST Portal would not suffice, and that the respondents ought to choose other modes of service also, which would be a proper exercise of the power of the respondents when there are other choices also made available under Section 169 of the Act.""what sub-clause (b) of sub-section (1) of section 169 of the Act requires is that the order in original should be sent by Speed Post with 'Acknowledgement due'.""Though the respondents have produced the Dispatch Register and a photocopy of the receipt issued by the Postal Department showing dispatch by Speed Post, they have not produced the 'Acknowledgment' card which would have been returned to the respondent after the article sent by speed post is received by the petitioner with signature of petitioner's representative.""Therefore, prima facie it cannot be said that there is compliance of sub-clause (b) of sub-section (1) of Section 169 of the CGST Act."FINAL VERDICTThe Writ Petition was admitted and the interim order dated 17.12.2025 already in favour of the petitioner was made absolute. The Court held, prima facie, that neither uploading the order on the GST portal alone nor dispatch by Speed Post without producing the Acknowledgement card satisfies the requirement of valid service under Section 169(1)(b) of the CGST Act.👍 IN FAVOUR OF ASSESSEECASE LAW REFERREDCaseCitationSharp Tanks and Structurals Pvt. Ltd. vs. Deputy Commissioner (GST) (Appeals), Tirunelveli(2025) 34 CENTEX 426 (Madras High Court)
Sri Nikhil Debnath vs. The Union of India & Others 06-05-2026
BACKGROUNDThe petitioner challenged an order in original passed under GST on the ground that the same was never validly served upon him. The respondents (Union of India and others) contended in their counter affidavit that the order was duly served — first, by uploading it on the GST common portal on 08.06.2023, and second, by dispatching it through Speed Post on 01.06.2023 to the address registered in the GST records.FACTSThe respondents, in support of their claim of valid service by Speed Post, produced the Dispatch Register and a photocopy of the receipt issued by the Postal Department showing dispatch. However, they failed to produce the Acknowledgement card, which is the document returned to the sender after the article is received by the addressee bearing the signature of the addressee or his representative. Further, the Department of Posts, Government of India, vide its communication dated 07.04.2026, informed the petitioner that there is no evidence of service of the said article upon the petitioner after it was dispatched by the respondents. The court also noted the earlier interim order dated 17.12.2025 already granted in favour of the petitioner.COURT OBSERVATIONS (Verbatim)"mere uploading of the order in the GST Portal would not suffice, and that the respondents ought to choose other modes of service also, which would be a proper exercise of the power of the respondents when there are other choices also made available under Section 169 of the Act.""what sub-clause (b) of sub-section (1) of section 169 of the Act requires is that the order in original should be sent by Speed Post with 'Acknowledgement due'.""Though the respondents have produced the Dispatch Register and a photocopy of the receipt issued by the Postal Department showing dispatch by Speed Post, they have not produced the 'Acknowledgment' card which would have been returned to the respondent after the article sent by speed post is received by the petitioner with signature of petitioner's representative.""Therefore, prima facie it cannot be said that there is compliance of sub-clause (b) of sub-section (1) of Section 169 of the CGST Act."FINAL VERDICTThe Writ Petition was admitted and the interim order dated 17.12.2025 already in favour of the petitioner was made absolute. The Court held, prima facie, that neither uploading the order on the GST portal alone nor dispatch by Speed Post without producing the Acknowledgement card satisfies the requirement of valid service under Section 169(1)(b) of the CGST Act.👍 IN FAVOUR OF ASSESSEECASE LAW REFERREDCaseCitationSharp Tanks and Structurals Pvt. Ltd. vs. Deputy Commissioner (GST) (Appeals), Tirunelveli(2025) 34 CENTEX 426 (Madras High Court)
BackgroundThe petitioner, a trader in rubber products, bought goods from M/s Sentu Dey between July 2017 and January 2019 and paid GST of ₹1,11,60,830 to the supplier. The supplier reported these sales in GSTR-1 but filed “Nil” GSTR-3B returns and did not deposit the tax. The department blocked the petitioner’s electronic credit ledger and issued an SCN under Section 73 on 07.01.2021. By order dated 17.05.2022 it confirmed the reversal of ₹1,11,60,830 with interest and penalty. The petitioner challenged that order and the vires of Section 16(2)(c) under Articles 14, 19(1)(g), 265 and 300A, contending that a purchaser has no mechanism to verify whether the supplier has paid the tax.Final VerdictThe Division Bench held that Section 16(2)(c) is not unconstitutional, but read it down. It adopted the reasoning of the Delhi High Court in On Quest Merchandising (under Section 9(2)(g) of the DVAT Act), which the Supreme Court approved in Arise India and Shanti Kiran India. The Court reasoned that a purchaser cannot practically ensure that the seller deposits the tax, and that ITC exists to avoid double taxation. Nothing in the Act expressly permits taxing a purchaser twice by denying credit in all situations. The High Courts that upheld the provision without reading it down had not considered these Supreme Court-approved decisions or the practical impossibility involved. The Court held that Section 16(2)(c) of the Act ought not to be interpreted to deny ITC to purchasers in a bona fide transaction like the petitioner and it should be read down and applied only where the transaction is found to be not bona fide or is a collusive transaction or fraudulent transaction to defraud the revenue. As the department had invoked only Section 73 (not fraud under Section 74) and did not dispute that the GST had been paid to the supplier, the transaction was held to be bona fide. The order was set aside and the department was directed to allow ITC of ₹1,11,60,830 forthwith.Subsequent development (interpretation): in Bhandari Scrap Traders (24.07.2026) the Supreme Court recorded that an SLP has been entertained against this judgment. It observed that the Tripura High Court had not undertaken the comparative DVAT/CGST analysis done by the Gujarat High Court, and upheld the Gujarat view that Section 16(2)(c) should not be read down. The precedential weight of this judgment should be assessed with that in mind.
Sahil Enterprises v. Union of India & Ors. 06-01-2026
BackgroundThe petitioner, a trader in rubber products, bought goods from M/s Sentu Dey between July 2017 and January 2019 and paid GST of ₹1,11,60,830 to the supplier. The supplier reported these sales in GSTR-1 but filed “Nil” GSTR-3B returns and did not deposit the tax. The department blocked the petitioner’s electronic credit ledger and issued an SCN under Section 73 on 07.01.2021. By order dated 17.05.2022 it confirmed the reversal of ₹1,11,60,830 with interest and penalty. The petitioner challenged that order and the vires of Section 16(2)(c) under Articles 14, 19(1)(g), 265 and 300A, contending that a purchaser has no mechanism to verify whether the supplier has paid the tax.Final VerdictThe Division Bench held that Section 16(2)(c) is not unconstitutional, but read it down. It adopted the reasoning of the Delhi High Court in On Quest Merchandising (under Section 9(2)(g) of the DVAT Act), which the Supreme Court approved in Arise India and Shanti Kiran India. The Court reasoned that a purchaser cannot practically ensure that the seller deposits the tax, and that ITC exists to avoid double taxation. Nothing in the Act expressly permits taxing a purchaser twice by denying credit in all situations. The High Courts that upheld the provision without reading it down had not considered these Supreme Court-approved decisions or the practical impossibility involved. The Court held that Section 16(2)(c) of the Act ought not to be interpreted to deny ITC to purchasers in a bona fide transaction like the petitioner and it should be read down and applied only where the transaction is found to be not bona fide or is a collusive transaction or fraudulent transaction to defraud the revenue. As the department had invoked only Section 73 (not fraud under Section 74) and did not dispute that the GST had been paid to the supplier, the transaction was held to be bona fide. The order was set aside and the department was directed to allow ITC of ₹1,11,60,830 forthwith.Subsequent development (interpretation): in Bhandari Scrap Traders (24.07.2026) the Supreme Court recorded that an SLP has been entertained against this judgment. It observed that the Tripura High Court had not undertaken the comparative DVAT/CGST analysis done by the Gujarat High Court, and upheld the Gujarat view that Section 16(2)(c) should not be read down. The precedential weight of this judgment should be assessed with that in mind.
Background. The petitioner’s electronic credit ledger was blocked by the State authorities on 20.03.2021 following scrutiny and an ASMT-10 notice, and was unblocked on 07.07.2021. In the meantime, to discharge its output liability for March 2021, the petitioner paid through the electronic cash ledger, and thereafter sought refund of the resulting accumulated credit of Rs. 78,20,202 in FORM GST RFD-01 under the residual category. The claim was rejected and the appeal dismissed on 14.03.2023. The petitioner had undertaken no business after March 2021 and continued to file nil returns while retaining registration for tender participation.Observations of the Court. The Court found that the dues for March 2021 had been discharged only through the cash ledger and not also through the blocked credit ledger, so there was no duplication or double payment for the tax period, and that the legality of the blocking and unblocking between 20.03.2021 and 07.07.2021 had never been the subject matter of any litigation in which it was determined.To claim refund of unutilised credit the petitioner had to fall within Section 54(3) read with Section 54(8), which permits refund only where credit accumulates on account of zero-rated supplies made without payment of tax, or where the rate of tax on inputs is higher than that on output supplies. Neither condition was satisfied. The accumulated credit remains available for future tax liability, and the refund had been sought under a misconception of law.Final verdict. No illegality was found in the impugned appellate order calling for interference in writ jurisdiction, and the petition was dismissed.
Sterlite Power Transmission Ltd. v. The Additional Commissioner (Appeals) 12-12-2024
Background. The petitioner’s electronic credit ledger was blocked by the State authorities on 20.03.2021 following scrutiny and an ASMT-10 notice, and was unblocked on 07.07.2021. In the meantime, to discharge its output liability for March 2021, the petitioner paid through the electronic cash ledger, and thereafter sought refund of the resulting accumulated credit of Rs. 78,20,202 in FORM GST RFD-01 under the residual category. The claim was rejected and the appeal dismissed on 14.03.2023. The petitioner had undertaken no business after March 2021 and continued to file nil returns while retaining registration for tender participation.Observations of the Court. The Court found that the dues for March 2021 had been discharged only through the cash ledger and not also through the blocked credit ledger, so there was no duplication or double payment for the tax period, and that the legality of the blocking and unblocking between 20.03.2021 and 07.07.2021 had never been the subject matter of any litigation in which it was determined.To claim refund of unutilised credit the petitioner had to fall within Section 54(3) read with Section 54(8), which permits refund only where credit accumulates on account of zero-rated supplies made without payment of tax, or where the rate of tax on inputs is higher than that on output supplies. Neither condition was satisfied. The accumulated credit remains available for future tax liability, and the refund had been sought under a misconception of law.Final verdict. No illegality was found in the impugned appellate order calling for interference in writ jurisdiction, and the petition was dismissed.
