BackgroundThe respondent, a manufacturer of electrical apparatus, also sold MEIS duty credit scrips (exempt from 13.10.2017). A Section 74 SCN required reversal of proportionate ITC of Rs. 74,75,604 under Section 17(2) and Rules 42/43 for FY 2017-18 to 2019-20, with interest and equal penalty, and this was confirmed. The First Appellate Authority set the demand aside, treating Notification 14/2022 (which excludes the value of scrips from exempt supplies) as clarificatory and beneficial, and so retrospective. Revenue appealed, and the respondent objected that the appeal was below the Rs. 20 lakh limit in Circular 207/1/2024-GST.Final VerdictThe Tribunal held that CBIC circulars do not bind the Tribunal, but on the circular’s own terms the appeal was maintainable, because the composite amount exceeded the limit and the issue was interpretational. On merits, Notification 14/2022 commences on its publication and the rule-maker, though empowered under Section 164(3), chose not to give it retrospective effect; the insertion of clause (d) is not clarificatory or curative but confers a fresh benefit prospectively from 05.07.2022, and ITC being a concession cannot be claimed retrospectively as a vested right (Sedco Forex, Sree Sankaracharya University). The appellate authority’s contrary view was therefore wrong. However, since the respondent filed all returns, disclosed the scrip sales and acted on a bona fide view known to both sides, no fraud, wilful misstatement or suppression was established and Section 74(1) could not be invoked (Anand Nishikawa; CBIC Instruction 05/2023-GST). Applying Section 75(2), the proper officer was directed to re-determine the liability as if under Section 73 after a hearing, and the appeals were disposed of accordingly. 

BACKGROUNDThe appeal arose from an order imposing penalties under Sections 122 and 125 read with Section 20 of the IGST Act. The Registry raised the issue of statutory pre-deposit for admission of the appeal.The SCN, original adjudication order and appellate order had all been issued before 01.10.2025, when the Finance Act, 2025 amendment introducing the additional pre-deposit for penalty-only orders came into force.COURT OBSERVATIONThe Tribunal noted that the amended proviso to Section 112(8) became effective only from 01.10.2025 and did not indicate retrospective application. Since the impugned appellate order was issued before the amendment, the Tribunal held that the amended pre-deposit condition could not be imposed on the appeal.FINAL VERDICTThe Tribunal held that no pre-deposit was required under Section 112 for the present appeal. It clarified that the order would not prejudice the merits and that, if at the final hearing the Tribunal concluded that the amended pre-deposit provision was applicable, the appellant would have to comply with that requirement. Notice was issued and the matter was directed to be listed after four weeks.CASE REFERRED BY COURTBarjinder Singh Kohli v. Assistant Commissioner & Others — Calcutta High Court — 03.11.2025. The Tribunal held that the decision squarely covered the issue of pre-deposit in a penalty-only matter where the proceedings commenced before 01.10.2025. 

BACKGROUNDThe appellant is engaged in the activity of transportation of goods by road. The department received third-party TDS data from the Income Tax Department showing gross receipts of Rs. 16,90,38,430/- by the appellant under Sections 194C/194H/194I/194J of the Income Tax Act. The department issued summons requiring the appellant to submit Income Tax Returns, TDS Returns, Balance Sheet, 3CD, Trial Balance and service-wise receipts chart. The appellant did not comply. The department alleged that the appellant had rendered taxable services without discharging service tax liability and issued Show Cause Notice No. 54/2016 dated 09.09.2019 proposing recovery of service tax of Rs. 2,08,93,150/- along with interest and penalties. The demand was confirmed by the Principal Commissioner vide Order-in-Original dated 06.01.2022, holding the appellant to be a GTA. Being aggrieved, the appellant filed the present appeal before CESTAT.COURT OBSERVATIONS (VERBATIM)On the statutory definition and twin conditions for GTA (Para 4.2):"It is clear that to be called 'Goods Transport Agency' a person should fulfill two conditions, namely: a) It should provide service in relation to transport of goods by road; b) It should issue consignment note, by whatever name called."On the distinction between GTA and GTO — from Jaikumar Fulchand Ajmera (Para 4.3):"We observe that since GTA definition has used the words, 'in relation to', it means that for being a GTA, it should provide service to a person in relation to transportation of goods by road in a goods carriage. The service provided is a single composite service which may include various intermediary and ancillary services such as loading/unloading, packing/unpacking, transshipment, temporary warehousing. For the service provided, GTA issues a consignment note and the invoice issued by the GTA for providing the said services includes the value of intermediary and ancillary services. In such a case, the intermediary or ancillary activities are to be treated as part of GTA service... Whereas GTO is the activity simpliciter for transport of goods by roads without issuance of Consignment Note, irrespective transporter being GTA or not."On the definition of GTA remaining unchanged under negative list regime (Para 4.4):"We also observe that the definition of GTA remained the same even after introduction of negative list regime. Service being determined by issuance of consignment note under the statute, it is not within the ambit of a subordinate legislation to create the class of taxable persons by imposing a condition that would, perforce, bring such persons within the tax net."On undisputed facts establishing appellant as GTO (Para 4.5):"(i) Appellant is not registered under Carriage by Road Act, 2007 and hence, is not a GTA; hence, is not at all required to issue a 'consignment note'; (ii) Appellant charges 'mere freight', as agreed, but does not charge 'gross freight'; (iii) Appellant engages merely in the service of providing transportation of goods by road but does not provide the services 'in relation thereof'..."On the Schedule of Responsibilities further establishing GTO character (Para 4.5):"a. Loading of the consignment is done by Safexpress personnel in the vehicles. b. The delivery must be done within transit time and the appellant shall ensure to maintain the same despite various unavoidable causes of delay. c. All waybills as well as transit documents are provided by Safexpress and carried by the appellant. d. Appellant is not responsible for any damage to the property unless it is caused out of his own negligence like rash driving of the driver. e. Appellant will submit the waybills, permits, transit passes etc. at the destination with the due endorsements. f. Unloading of the consignment is done by the recipient at destination."On the final conclusion (Para 5):"Since under GTA it is only such of these services which are in relation to transport of goods by road which are taxable and not the actual transport of goods by road itself. And that appellant has not rendered any service in relation to transport of goods by road like loading/unloading nor even for reimbursing for damage and not issuing the consignment note except mere transport of Goods by road. No evidence to the contrary is produced by the department. Resultantly we hold that appellant's activity is wrongly held to be taxable service of Goods Transport Agency."FINAL VERDICTThe CESTAT set aside the Order-in-Original and allowed the appeal, holding that the appellant is a Goods Transport Operator (GTO) and not a Goods Transport Agency (GTA). The activity of mere transportation of goods by road without issuance of a consignment note and without rendering ancillary services is covered under the negative list under Section 66D(p)(i) of the Finance Act, 1994 and is not liable to service tax. 👍

2. BackgroundFor FY 2018-19 the appellant, an EPC contractor, reported tax in GSTR-3B Rs. 27,06,634 lower than in GSTR-1. It attributed the difference to credit notes and advance adjustments recorded in its books and GSTR-3B but not amended in GSTR-1. A Section 74 demand of Rs. 65,17,849 was raised. The First Appellate Authority found no intent to evade, but itself recomputed the case under Section 73, confirming tax and interest with a 10% penalty, holding that the credit notes were beyond the Section 34(2) time limit and recipients’ ITC reversal was unproven.3. Final VerdictRejecting Revenue’s reliance on Hamida v. Md. Khalil, the Tribunal held that unlike Section 100 CPC, Section 112 read with Rule 112 does not confine the Tribunal to questions of law; it is the last fact-finding forum, and that Dilip Kumar & Co. (on exemption notifications) had no bearing on whether tax was actually short-paid. It noted that the only lapse found was the non-reflection in periodical returns of debit and credit notes duly accounted in the books, at a time when online filing was not fully operational, and adopted a pragmatic rather than pedantic approach. Relying on the text of Section 75(2) and CBIC Circular 254/11/2025-GST, it held that once Section 74 fails, it is the proper officer, not the appellate authority or the Tribunal, who must re-determine tax as if the notice had been issued under Section 73. The finding that Section 74 did not apply was upheld, but the Section 73 determinations of both lower authorities were set aside and the matter remanded, with liberty to file amendments within one month and a direction to examine the genuineness of the credit and debit notes and decide afresh after a hearing.