Facts The petitioner, a logistics service provider registered under GST, challenged Section 16(2)(c) and Rule 36(4), contending that they impose an impossible burden on recipients to ensure tax payment by suppliers. It was argued that denial of ITC due to supplier default is arbitrary and beyond the control of the recipient. The petitioner sought declaration of the provisions as unconstitutional or alternatively sought reading down to protect bona fide recipients who complied with statutory requirements. Court Decision:The High Court declined to strike down Section 16(2)(c) and Rule 36(4). The Court held that the provisions cannot be declared unconstitutional. However, relying on precedents, the Court held that bona fide purchasers cannot be denied ITC merely due to default of the selling dealer, unless there is fraud, collusion, or lack of genuineness in the transaction. The matter was considered in light of judicial precedents emphasizing protection of genuine transactions and limiting denial of ITC only in appropriate cases. Cases Referred by Court:• Commissioner of Trade and Taxes v. Arise India Ltd. • On Quest Merchandising India Pvt. Ltd. v. Union of India • Corporation Bank v. Saraswati Abharansala • Gheru Lal Bal Chand v. State of Haryana • State of Karnataka v. Rajesh Jain • Onyx Designs v. Assistant Commissioner of Commercial Taxes
Instakart Services Private Limited v. Union of India & Ors. 09-02-2026
Facts The petitioner, a logistics service provider registered under GST, challenged Section 16(2)(c) and Rule 36(4), contending that they impose an impossible burden on recipients to ensure tax payment by suppliers. It was argued that denial of ITC due to supplier default is arbitrary and beyond the control of the recipient. The petitioner sought declaration of the provisions as unconstitutional or alternatively sought reading down to protect bona fide recipients who complied with statutory requirements. Court Decision:The High Court declined to strike down Section 16(2)(c) and Rule 36(4). The Court held that the provisions cannot be declared unconstitutional. However, relying on precedents, the Court held that bona fide purchasers cannot be denied ITC merely due to default of the selling dealer, unless there is fraud, collusion, or lack of genuineness in the transaction. The matter was considered in light of judicial precedents emphasizing protection of genuine transactions and limiting denial of ITC only in appropriate cases. Cases Referred by Court:• Commissioner of Trade and Taxes v. Arise India Ltd. • On Quest Merchandising India Pvt. Ltd. v. Union of India • Corporation Bank v. Saraswati Abharansala • Gheru Lal Bal Chand v. State of Haryana • State of Karnataka v. Rajesh Jain • Onyx Designs v. Assistant Commissioner of Commercial Taxes
BACKGROUNDNineteen writ petitions were filed by multiple petitioners — all engaged in the medical equipment supply business in Coimbatore — challenging assessment orders passed in Form GST DRC-07 under Section 74 of the respective GST enactments for tax periods ranging from 2020-2021 to 2024-2025. The Revenue, after investigation and inspection, found that the petitioners were part of an organised circular trading ring, wherein they billed each other without any actual movement of goods. The sole purpose was not to pass fake ITC to the end user but to artificially inflate their business turnover to create a creditworthy image before banks and obtain bank loans. The assessment orders recorded that 96% to 100% of the total purchase and sales turnover of the petitioners constituted circular trading transactions, with only 1% or less being genuine original transactions. CRUCIAL FACTSThe assessment orders in Form GST DRC-07 confirmed demands levying penalty under Section 122(1)(ii) — for issuing invoices without supply of goods — and Section 122(1)(vii) — for availing Input Tax Credit without actual receipt of goods. The total penalty imposed across all 19 petitions aggregated to approximately Rs.12.34 crores under Section 122(1)(vii) and Rs.13.67 crores under Section 122(1)(ii). The petitioners' primary legal argument before the High Court was that the maximum penalty imposable under Section 122(1) is Rs.10,000/- and the assessing officers had no authority to impose penalty equivalent to the ITC wrongly availed, as the doctrine of proportionality required the penalty to be commensurate with the gravity of the offence. They relied upon Supreme Court judgments in labour law and service law matters on the doctrine of proportionality. The Revenue countered that Section 122(1) uses the expression "whichever is higher" — Rs.10,000/- or the amount of tax evaded/ITC irregularly availed — leaving no discretion whatsoever to levy a lower amount. The Respondents further relied on the Supreme Court's ruling in Dharamendra Textile Processors on the mandatory nature of statutory penalties. COURT OBSERVATIONS (Verbatim — Crucial)On Circular Trading and the Petitioners' conduct:"The above table shows that the above tax payers are involved in circular trading and has 1% or less original transactions that too were done to portray themselves as genuine tax payers but that is not the case. The above tax payers just to boost up their turnover has billed themselves without any goods movement and their aim is not transfer fake ITC but to boost up their business turnover to get bank loans, to create an image that they are big players in this medical equipment supply business."On Section 122(1) — No discretion to levy Rs.10,000/- as minimum:"The language in Section 122(1) of the respective GST Enactments also does not give any discretion to the Assessing Officer to levy lesser of the amount i.e., Rs.10,000/- as the expression used is 'whichever is higher'.""The above decisions of the Hon'ble Supreme Court cannot be applied to the facts of the case specifically in the light of the language in Section 122(1) of the respective GST Enactments. The expression used in Section 122(1) is 'whichever is higher'."On inapplicability of Dharamendra Textile ratio to GST Section 122:"Section 11-AC of the Central Excise Act, 1944 which fell for consideration is the above-mentioned decision of the Hon'ble Supreme Court is different from Section 122 of the respective GST Enactments. The Hon'ble Supreme Court in Union of India Vs. Rajasthan Spinning and Weaving Mills, (2009) 13 SCC 448, has pointed out that the ratio was confined to Section 11-AC of the Central Excise Act, 1944 and no observations with regard to the several other statutory provisions that came up for consideration in that decision."On prima facie liability:"No doubt that the Petitioners have wrongly availed the Input Tax Credit and have apparently passed on the credit to boost up their respective turn overs with a view to take undue advantage of the system, prima facie they are liable to penalty under Section 122(1) of the respective GST Enactments."On availability of statutory remedy and writ jurisdiction:"The provisions of the respective GST Enactments contemplate an appellate remedy before the Appellate Authority under Section 107 of the respective GST Enactments and further appeal before GST Tribunal under Section 122 of the respective GST Enactments and thereafter remedy before the High Court. The finer aspects of law at best can be left to be decided by the Division Bench of this Court in its appellate jurisdiction under Section 117 of the respective GST Enactments which is in line with the Judgment of the Hon'ble Supreme Court in L.Chandrakumar Vs. Union of India and others, (1997) 3 SCC 261.""The Petitioner cannot short circuit the statutory mechanism prescribed by citing the decisions and the principle laid under the indirect tax enactments which have been subsumed into the respective GST Enactments."On pre-deposit waiver:"Since pre-deposit of huge penalty as prescribed under Section 107 of the respective GST Enactments will cause undue hardship to the respective Petitioners and make the appellate remedy illusory, pre-deposit of 10% of penalty under Section 107 of the respective GST Enactments is dispensed with at the time of filing the appeals before the Appellate Authority." FINAL VERDICTAll 19 writ petitions are dismissed. Liberty granted to petitioners to file appeals before the Appellate Authority under Section 107 within 30 days. The mandatory pre-deposit of 10% of penalty under Section 107 is waived in view of the large quantum of penalty, to prevent the appellate remedy from becoming illusory. Appellate Authority directed to decide the appeals preferably within 90 days.👎 THUMBS DOWN (Against Assessees — Writ dismissed; however significant relief granted by way of pre-deposit waiver)
Tvl. SAM Enterprises & Others vs. Commercial Tax Officer & Others 08-02-2026
BACKGROUNDNineteen writ petitions were filed by multiple petitioners — all engaged in the medical equipment supply business in Coimbatore — challenging assessment orders passed in Form GST DRC-07 under Section 74 of the respective GST enactments for tax periods ranging from 2020-2021 to 2024-2025. The Revenue, after investigation and inspection, found that the petitioners were part of an organised circular trading ring, wherein they billed each other without any actual movement of goods. The sole purpose was not to pass fake ITC to the end user but to artificially inflate their business turnover to create a creditworthy image before banks and obtain bank loans. The assessment orders recorded that 96% to 100% of the total purchase and sales turnover of the petitioners constituted circular trading transactions, with only 1% or less being genuine original transactions. CRUCIAL FACTSThe assessment orders in Form GST DRC-07 confirmed demands levying penalty under Section 122(1)(ii) — for issuing invoices without supply of goods — and Section 122(1)(vii) — for availing Input Tax Credit without actual receipt of goods. The total penalty imposed across all 19 petitions aggregated to approximately Rs.12.34 crores under Section 122(1)(vii) and Rs.13.67 crores under Section 122(1)(ii). The petitioners' primary legal argument before the High Court was that the maximum penalty imposable under Section 122(1) is Rs.10,000/- and the assessing officers had no authority to impose penalty equivalent to the ITC wrongly availed, as the doctrine of proportionality required the penalty to be commensurate with the gravity of the offence. They relied upon Supreme Court judgments in labour law and service law matters on the doctrine of proportionality. The Revenue countered that Section 122(1) uses the expression "whichever is higher" — Rs.10,000/- or the amount of tax evaded/ITC irregularly availed — leaving no discretion whatsoever to levy a lower amount. The Respondents further relied on the Supreme Court's ruling in Dharamendra Textile Processors on the mandatory nature of statutory penalties. COURT OBSERVATIONS (Verbatim — Crucial)On Circular Trading and the Petitioners' conduct:"The above table shows that the above tax payers are involved in circular trading and has 1% or less original transactions that too were done to portray themselves as genuine tax payers but that is not the case. The above tax payers just to boost up their turnover has billed themselves without any goods movement and their aim is not transfer fake ITC but to boost up their business turnover to get bank loans, to create an image that they are big players in this medical equipment supply business."On Section 122(1) — No discretion to levy Rs.10,000/- as minimum:"The language in Section 122(1) of the respective GST Enactments also does not give any discretion to the Assessing Officer to levy lesser of the amount i.e., Rs.10,000/- as the expression used is 'whichever is higher'.""The above decisions of the Hon'ble Supreme Court cannot be applied to the facts of the case specifically in the light of the language in Section 122(1) of the respective GST Enactments. The expression used in Section 122(1) is 'whichever is higher'."On inapplicability of Dharamendra Textile ratio to GST Section 122:"Section 11-AC of the Central Excise Act, 1944 which fell for consideration is the above-mentioned decision of the Hon'ble Supreme Court is different from Section 122 of the respective GST Enactments. The Hon'ble Supreme Court in Union of India Vs. Rajasthan Spinning and Weaving Mills, (2009) 13 SCC 448, has pointed out that the ratio was confined to Section 11-AC of the Central Excise Act, 1944 and no observations with regard to the several other statutory provisions that came up for consideration in that decision."On prima facie liability:"No doubt that the Petitioners have wrongly availed the Input Tax Credit and have apparently passed on the credit to boost up their respective turn overs with a view to take undue advantage of the system, prima facie they are liable to penalty under Section 122(1) of the respective GST Enactments."On availability of statutory remedy and writ jurisdiction:"The provisions of the respective GST Enactments contemplate an appellate remedy before the Appellate Authority under Section 107 of the respective GST Enactments and further appeal before GST Tribunal under Section 122 of the respective GST Enactments and thereafter remedy before the High Court. The finer aspects of law at best can be left to be decided by the Division Bench of this Court in its appellate jurisdiction under Section 117 of the respective GST Enactments which is in line with the Judgment of the Hon'ble Supreme Court in L.Chandrakumar Vs. Union of India and others, (1997) 3 SCC 261.""The Petitioner cannot short circuit the statutory mechanism prescribed by citing the decisions and the principle laid under the indirect tax enactments which have been subsumed into the respective GST Enactments."On pre-deposit waiver:"Since pre-deposit of huge penalty as prescribed under Section 107 of the respective GST Enactments will cause undue hardship to the respective Petitioners and make the appellate remedy illusory, pre-deposit of 10% of penalty under Section 107 of the respective GST Enactments is dispensed with at the time of filing the appeals before the Appellate Authority." FINAL VERDICTAll 19 writ petitions are dismissed. Liberty granted to petitioners to file appeals before the Appellate Authority under Section 107 within 30 days. The mandatory pre-deposit of 10% of penalty under Section 107 is waived in view of the large quantum of penalty, to prevent the appellate remedy from becoming illusory. Appellate Authority directed to decide the appeals preferably within 90 days.👎 THUMBS DOWN (Against Assessees — Writ dismissed; however significant relief granted by way of pre-deposit waiver)
Facts :The petitioner challenged the inability to file an appeal against assessment order dated 15.06.2023 due to delay. The order raised demand towards tax, interest and penalty for FY 2020–21. The petitioner contended that the order was only uploaded on the GST portal and not served physically, and due to closure of business, he did not access the portal. As a result, the petitioner remained unaware of the order and could not file appeal within limitation.Court Decision:The Court held that although the Appellate Authority is bound by limitation under Section 107, in the present case the delay occurred due to reasons beyond the petitioner’s control. It observed that non-consideration of appeal on merits would cause prejudice. Following earlier Division Bench decisions, the Court condoned the delay and directed the Appellate Authority to entertain the appeal and decide it on merits.Cases Referred:M/s Molana Construction Company v. Central Goods and Service Tax Department & Ors.Man Singh Tanwar v. Commissioner, Central Goods and Services Tax Department & Ors.RPC PSIPL JV v. State of Rajasthan & Ors.
Vikas Chachan v. State of Rajasthan & Ors. 05-02-2026
Facts :The petitioner challenged the inability to file an appeal against assessment order dated 15.06.2023 due to delay. The order raised demand towards tax, interest and penalty for FY 2020–21. The petitioner contended that the order was only uploaded on the GST portal and not served physically, and due to closure of business, he did not access the portal. As a result, the petitioner remained unaware of the order and could not file appeal within limitation.Court Decision:The Court held that although the Appellate Authority is bound by limitation under Section 107, in the present case the delay occurred due to reasons beyond the petitioner’s control. It observed that non-consideration of appeal on merits would cause prejudice. Following earlier Division Bench decisions, the Court condoned the delay and directed the Appellate Authority to entertain the appeal and decide it on merits.Cases Referred:M/s Molana Construction Company v. Central Goods and Service Tax Department & Ors.Man Singh Tanwar v. Commissioner, Central Goods and Services Tax Department & Ors.RPC PSIPL JV v. State of Rajasthan & Ors.
Facts :The petitioner alleged that GST officers illegally detained him from 17.06.2025 to 20.06.2025 after calling him to the office of a Chartered Accountant in connection with investigation into fraudulent input tax credit by M/s Kabsan Services Pvt. Ltd. He contended that he was taken into custody without summons and that the formal arrest was shown only on 21.06.2025 under Section 69 of the CGST Act for offences under Sections 132(1)(b), 132(1)(c) and 132(1)(i). The petitioner sought compensation of ₹10,00,000 for alleged illegal detention. Court Decision:The Court held that the petitioner had been issued summons under Section 70 of the CGST Act for inquiry and recording of statement. The petitioner acknowledged the summons and appeared before the authorities from 17.06.2025 to 20.06.2025 without raising any objection. The Court further held that Section 70 of the CGST Act does not require issuance of seven days’ prior notice before appearance for inquiry and that attendance pursuant to summons for investigation cannot be treated as detention.The Court observed that the petitioner was formally arrested on 21.06.2025 after ascertainment of his involvement and was produced before the Magistrate on the same day. Since the petitioner had voluntarily attended the inquiry and no illegal detention was established, the claim for compensation was rejected and the writ petition was dismissed. Cases Referred by Court:• Joginder Kumar vs. State of U.P.• D.K. Basu vs. State of West Bengal• Dikshant vs. State of Maharashtra• FSM Education Pvt. Ltd. vs. Union of India• Ram Kotumal Issrani vs. Directorate of Enforcement• Radhika Agarwal vs. Union of India
Kanhaiya Nilambar Jha vs. Union of India & Ors. 05-02-2026
Facts :The petitioner alleged that GST officers illegally detained him from 17.06.2025 to 20.06.2025 after calling him to the office of a Chartered Accountant in connection with investigation into fraudulent input tax credit by M/s Kabsan Services Pvt. Ltd. He contended that he was taken into custody without summons and that the formal arrest was shown only on 21.06.2025 under Section 69 of the CGST Act for offences under Sections 132(1)(b), 132(1)(c) and 132(1)(i). The petitioner sought compensation of ₹10,00,000 for alleged illegal detention. Court Decision:The Court held that the petitioner had been issued summons under Section 70 of the CGST Act for inquiry and recording of statement. The petitioner acknowledged the summons and appeared before the authorities from 17.06.2025 to 20.06.2025 without raising any objection. The Court further held that Section 70 of the CGST Act does not require issuance of seven days’ prior notice before appearance for inquiry and that attendance pursuant to summons for investigation cannot be treated as detention.The Court observed that the petitioner was formally arrested on 21.06.2025 after ascertainment of his involvement and was produced before the Magistrate on the same day. Since the petitioner had voluntarily attended the inquiry and no illegal detention was established, the claim for compensation was rejected and the writ petition was dismissed. Cases Referred by Court:• Joginder Kumar vs. State of U.P.• D.K. Basu vs. State of West Bengal• Dikshant vs. State of Maharashtra• FSM Education Pvt. Ltd. vs. Union of India• Ram Kotumal Issrani vs. Directorate of Enforcement• Radhika Agarwal vs. Union of India
Background & IssueThe petitioner, proprietor of M/s Shivani Overseas, challenged a summons dated 03.11.2025 issued under Section 70 of the CGST Act, 2017 in connection with an inquiry relating to M/s Midas Marketing Inc. The summons directed the petitioner to appear and produce bank statements, sales invoices, and ledgers. The summons was issued by the Superintendent/Senior Intelligence Officer in reliance upon Circular No. 3/3/2017 dated 05.07.2017 issued by the Central Board of Excise and Customs (now CBIC). The core legal issue before the Court was whether the said circular was validly issued — specifically, whether the Board (CBIC) had the authority to assign functions to "proper officers" under Section 2(91) of the CGST Act, or whether such power vested exclusively in the "Commissioner in the Board" as defined under Section 2(25) read with Section 168(2) of the CGST Act. The petitioner contended that only the "Commissioner in the Board" — being a Commissioner or Joint Secretary posted in the Board — could assign such functions, and that the circular issued in the name of the "Board" was therefore without legal authority, rendering the summons issued thereunder void.Court's DecisionThe Court, after examining the statutory framework, held that there was no ground to interfere with the validity of Circular No. 3/3/2017. It observed that since the Commissioner is admittedly a constituent part of the Board, the assignment of functions through the circular must be presumed to have been initiated at the level of the Commissioner in the Board and duly approved by the Board, as contemplated under Section 168(2) of the CGST Act. The Court further noted that the petitioner had failed to discharge the burden of establishing that the circular was issued without authority — he merely relied upon the language of the preamble of the circular using the word "Board," without pleading or proving through documents that the required procedure under Section 168(2) was not followed. Applying the well-settled principle of presumption of validity of subordinate legislation — as reaffirmed in State of Tamil Nadu v. P. Krishnamurthy (2006) 4 SCC 517, G.M. (Operations) S.B.I. & Anr. v. R. Periyasamy, Civil Appeal No. 10942/2014, and Ram Krishna Dalmia v. S.R. Tendolkar, 1958 SCC OnLine SC 6 — the Court held that the onus lay on the petitioner to prove invalidity, which he failed to discharge.Most Relevant Court Observation"In law, we have to presume that the circular is valid and the onus is on the petitioner to discharge the burden of establishing that the circular was issued without authority or legal approval." The Court further observed: "The fact remains that it is not in dispute that the Commissioner is also a part of the Board. Once it is not in dispute that the Commissioner is part of the Board, and sub-section (2) of Section 168 contemplates that the assignment of functions to the Central Tax Officers is upon a proposal of the Commissioner in the Board, we see no reason to disbelieve that the same was not under the authority of the Commissioner, which was approved by the Board as required under sub-section (2) of Section 168."Cases ReferredState of Tamil Nadu v. P. Krishnamurthy, (2006) 4 SCC 517 | G.M. (Operations) S.B.I. & Anr. v. R. Periyasamy, Civil Appeal No. 10942/2014 | Ram Krishna Dalmia v. S.R. Tendolkar, 1958 SCC OnLine SC 6
Lovelesh Singhal v. Central Board of Indirect Taxes & Customs & Ors. 02-02-2026
Background & IssueThe petitioner, proprietor of M/s Shivani Overseas, challenged a summons dated 03.11.2025 issued under Section 70 of the CGST Act, 2017 in connection with an inquiry relating to M/s Midas Marketing Inc. The summons directed the petitioner to appear and produce bank statements, sales invoices, and ledgers. The summons was issued by the Superintendent/Senior Intelligence Officer in reliance upon Circular No. 3/3/2017 dated 05.07.2017 issued by the Central Board of Excise and Customs (now CBIC). The core legal issue before the Court was whether the said circular was validly issued — specifically, whether the Board (CBIC) had the authority to assign functions to "proper officers" under Section 2(91) of the CGST Act, or whether such power vested exclusively in the "Commissioner in the Board" as defined under Section 2(25) read with Section 168(2) of the CGST Act. The petitioner contended that only the "Commissioner in the Board" — being a Commissioner or Joint Secretary posted in the Board — could assign such functions, and that the circular issued in the name of the "Board" was therefore without legal authority, rendering the summons issued thereunder void.Court's DecisionThe Court, after examining the statutory framework, held that there was no ground to interfere with the validity of Circular No. 3/3/2017. It observed that since the Commissioner is admittedly a constituent part of the Board, the assignment of functions through the circular must be presumed to have been initiated at the level of the Commissioner in the Board and duly approved by the Board, as contemplated under Section 168(2) of the CGST Act. The Court further noted that the petitioner had failed to discharge the burden of establishing that the circular was issued without authority — he merely relied upon the language of the preamble of the circular using the word "Board," without pleading or proving through documents that the required procedure under Section 168(2) was not followed. Applying the well-settled principle of presumption of validity of subordinate legislation — as reaffirmed in State of Tamil Nadu v. P. Krishnamurthy (2006) 4 SCC 517, G.M. (Operations) S.B.I. & Anr. v. R. Periyasamy, Civil Appeal No. 10942/2014, and Ram Krishna Dalmia v. S.R. Tendolkar, 1958 SCC OnLine SC 6 — the Court held that the onus lay on the petitioner to prove invalidity, which he failed to discharge.Most Relevant Court Observation"In law, we have to presume that the circular is valid and the onus is on the petitioner to discharge the burden of establishing that the circular was issued without authority or legal approval." The Court further observed: "The fact remains that it is not in dispute that the Commissioner is also a part of the Board. Once it is not in dispute that the Commissioner is part of the Board, and sub-section (2) of Section 168 contemplates that the assignment of functions to the Central Tax Officers is upon a proposal of the Commissioner in the Board, we see no reason to disbelieve that the same was not under the authority of the Commissioner, which was approved by the Board as required under sub-section (2) of Section 168."Cases ReferredState of Tamil Nadu v. P. Krishnamurthy, (2006) 4 SCC 517 | G.M. (Operations) S.B.I. & Anr. v. R. Periyasamy, Civil Appeal No. 10942/2014 | Ram Krishna Dalmia v. S.R. Tendolkar, 1958 SCC OnLine SC 6
BACKGROUNDThe petitioner, a trader in iron and iron scrap, had its GST registration cancelled suo motu with effect from 01.06.2023. The petitioner challenged the cancellation before the High Court in an earlier writ petition, which was disposed of on 19.06.2024 directing the petitioner to either apply for revocation of cancellation under Section 30 of the GST Act or challenge the cancellation order by way of appeal — within 15 days. Pursuant to that direction, the petitioner filed an application for revocation, which remained pending. Meanwhile, the jurisdictional officer conducted inspection followed by an audit covering the period December 2021 to June 2023, issued a pre-show cause notice and a show cause notice, and thereafter passed an assessment order on 11.11.2024 disallowing Input Tax Credit claimed by the petitioner and raising a demand. The assessment order was uploaded on the GST portal. Recovery proceedings were initiated on 31.01.2025, upon which the petitioner claims to have first come to know of the assessment order and thereafter filed the present writ petition on 05.01.2026 — approximately 14 months after the assessment order. CRUCIAL FACTSNotices in Form DRC-01A dated 30.08.2024 and Form DRC-01 dated 20.09.2024 were served on the petitioner both through the GST portal and through registered post dated 25.09.2024, which was returned with an endorsement "no such person available." No response was filed by the petitioner to the show cause notice. The assessment order was passed on 11.11.2024 and uploaded on the portal. The petitioner approached the High Court only on 05.01.2026, offering the sole explanation that it could not access the portal as its registration had been cancelled. The Court noted that since the assessment order related to the period December 2021 to June 2023 — a period prior to cancellation — there was no restriction on the petitioner from accessing the portal with respect to that period. No other explanation was offered for the delay of over 14 months in filing the writ petition.COURT OBSERVATIONS (Verbatim — Crucial)On Portal Service being valid service:(Reproduced from the Court's own earlier order in W.P. No. 16500 of 2025 and batch, which was followed in this case):"The contention that the registered persons/dealers were unaware of the service of the impugned orders in the portal cannot be accepted as a ground for condoning delay. Acceptance of such a plea would throw open the doors for filing of Writ Petitions against the orders which have been passed years back. In fact most of the Writ petitions in the present batch are cases where orders had been passed in the year 2023 itself. Further, the prescribed method of service of notices and orders includes service of the order through the portal being maintained by the GST Authorities. Once such a method of service has been included in the Act and Rules, the contention that such service is not sufficient service and did not give actual notice of service to the registered persons cannot be accepted."On Petitioner's claim of inability to access portal post-cancellation:"Though the registration of the petitioner was cancelled by order dated 15.07.2023, still the petitioner can access the portal inasmuch as the assessment order was passed in relation to period from December, 2021 to June, 2023 and therefore, there is no restriction on the petitioner to access the portal. In such circumstances, the contention of the petitioner cannot be countenanced."On Unexplained Delay:"Though, the order was passed on 11.11.2024, no explanation whatsoever has been offered by the petitioner for the delay in filing the present writ petition. The only explanation offered by the petitioner is that it could not access the portal as its registration was cancelled.""In the case on hand, as already recorded supra, the petitioner has not offered any explanation for the delay in approaching this Court and therefore, the present writ petition cannot be entertained at this distance of time." FINAL VERDICTThe writ petition is dismissed on the ground of inordinate and unexplained delay. The petitioner's plea of inability to access the GST portal due to cancellation of registration was rejected. No order as to costs.👎 THUMBS DOWN (Against Assessee)
A.R. Steels vs. The Deputy Assistant Commissioner STL & Others 31-01-2026
BACKGROUNDThe petitioner, a trader in iron and iron scrap, had its GST registration cancelled suo motu with effect from 01.06.2023. The petitioner challenged the cancellation before the High Court in an earlier writ petition, which was disposed of on 19.06.2024 directing the petitioner to either apply for revocation of cancellation under Section 30 of the GST Act or challenge the cancellation order by way of appeal — within 15 days. Pursuant to that direction, the petitioner filed an application for revocation, which remained pending. Meanwhile, the jurisdictional officer conducted inspection followed by an audit covering the period December 2021 to June 2023, issued a pre-show cause notice and a show cause notice, and thereafter passed an assessment order on 11.11.2024 disallowing Input Tax Credit claimed by the petitioner and raising a demand. The assessment order was uploaded on the GST portal. Recovery proceedings were initiated on 31.01.2025, upon which the petitioner claims to have first come to know of the assessment order and thereafter filed the present writ petition on 05.01.2026 — approximately 14 months after the assessment order. CRUCIAL FACTSNotices in Form DRC-01A dated 30.08.2024 and Form DRC-01 dated 20.09.2024 were served on the petitioner both through the GST portal and through registered post dated 25.09.2024, which was returned with an endorsement "no such person available." No response was filed by the petitioner to the show cause notice. The assessment order was passed on 11.11.2024 and uploaded on the portal. The petitioner approached the High Court only on 05.01.2026, offering the sole explanation that it could not access the portal as its registration had been cancelled. The Court noted that since the assessment order related to the period December 2021 to June 2023 — a period prior to cancellation — there was no restriction on the petitioner from accessing the portal with respect to that period. No other explanation was offered for the delay of over 14 months in filing the writ petition.COURT OBSERVATIONS (Verbatim — Crucial)On Portal Service being valid service:(Reproduced from the Court's own earlier order in W.P. No. 16500 of 2025 and batch, which was followed in this case):"The contention that the registered persons/dealers were unaware of the service of the impugned orders in the portal cannot be accepted as a ground for condoning delay. Acceptance of such a plea would throw open the doors for filing of Writ Petitions against the orders which have been passed years back. In fact most of the Writ petitions in the present batch are cases where orders had been passed in the year 2023 itself. Further, the prescribed method of service of notices and orders includes service of the order through the portal being maintained by the GST Authorities. Once such a method of service has been included in the Act and Rules, the contention that such service is not sufficient service and did not give actual notice of service to the registered persons cannot be accepted."On Petitioner's claim of inability to access portal post-cancellation:"Though the registration of the petitioner was cancelled by order dated 15.07.2023, still the petitioner can access the portal inasmuch as the assessment order was passed in relation to period from December, 2021 to June, 2023 and therefore, there is no restriction on the petitioner to access the portal. In such circumstances, the contention of the petitioner cannot be countenanced."On Unexplained Delay:"Though, the order was passed on 11.11.2024, no explanation whatsoever has been offered by the petitioner for the delay in filing the present writ petition. The only explanation offered by the petitioner is that it could not access the portal as its registration was cancelled.""In the case on hand, as already recorded supra, the petitioner has not offered any explanation for the delay in approaching this Court and therefore, the present writ petition cannot be entertained at this distance of time." FINAL VERDICTThe writ petition is dismissed on the ground of inordinate and unexplained delay. The petitioner's plea of inability to access the GST portal due to cancellation of registration was rejected. No order as to costs.👎 THUMBS DOWN (Against Assessee)
Facts:Search and inspection proceedings were initiated against the petitioner on 06.01.2021 under Section 67(2) of the RGST Act pursuant to authorization issued by the Additional Commissioner. Based on the search proceedings, a show cause notice dated 30.03.2023 was issued and an order dated 05.06.2023 was passed by the proper officer. The petitioner filed an appeal under Section 107 of the RGST Act, which was dismissed on 11.12.2023 by the Appellate Authority.Court Decision:The High Court held that the authorization for inspection and search under Section 67 of the RGST Act was issued by the same officer who later acted as the Appellate Authority under Section 107 while deciding the appeal arising out of those proceedings. The Court observed that such dual exercise of power violates the principle of natural justice that no person should be a judge in his own cause.Accordingly, the appellate order dated 11.12.2023 passed under Section 107 of the RGST Act was quashed and set aside. The matter was remanded back to the Appellate Authority with a direction that the appeal be decided afresh by a competent appellate authority other than the officer who authorized the search proceedings.
Ramjilal Mohanlal vs. Union of India & Ors. 29-01-2026
Facts:Search and inspection proceedings were initiated against the petitioner on 06.01.2021 under Section 67(2) of the RGST Act pursuant to authorization issued by the Additional Commissioner. Based on the search proceedings, a show cause notice dated 30.03.2023 was issued and an order dated 05.06.2023 was passed by the proper officer. The petitioner filed an appeal under Section 107 of the RGST Act, which was dismissed on 11.12.2023 by the Appellate Authority.Court Decision:The High Court held that the authorization for inspection and search under Section 67 of the RGST Act was issued by the same officer who later acted as the Appellate Authority under Section 107 while deciding the appeal arising out of those proceedings. The Court observed that such dual exercise of power violates the principle of natural justice that no person should be a judge in his own cause.Accordingly, the appellate order dated 11.12.2023 passed under Section 107 of the RGST Act was quashed and set aside. The matter was remanded back to the Appellate Authority with a direction that the appeal be decided afresh by a competent appellate authority other than the officer who authorized the search proceedings.
Facts:The petitioner’s GST registration was cancelled by an order dated 28.10.2022 after issuance of a show cause notice dated 12.10.2022 alleging that the registration had been obtained by fraud, wilful misstatement, or suppression of facts. The petitioner filed a reply to the show cause notice explaining the circumstances, including that the business had already been discontinued. Despite this, the authority cancelled the registration without addressing the reply or providing proper reasons.Court Decision:The High Court observed that the show cause notice was a cyclostyled notice without specific allegations and that there were serious discrepancies between the allegations in the show cause notice and the reasons recorded in the cancellation order. The authority had not considered the petitioner’s reply or provided any particulars of defects or objections.The Court held that the authority acted in a casual and mechanical manner without properly exercising jurisdiction under the CGST Act. Accordingly, the impugned order dated 28.10.2022 cancelling the GST registration was quashed and set aside, and the petitioner’s GST registration was restored.
Om Enterprises vs. Union of India & Ors. 29-01-2026
Facts:The petitioner’s GST registration was cancelled by an order dated 28.10.2022 after issuance of a show cause notice dated 12.10.2022 alleging that the registration had been obtained by fraud, wilful misstatement, or suppression of facts. The petitioner filed a reply to the show cause notice explaining the circumstances, including that the business had already been discontinued. Despite this, the authority cancelled the registration without addressing the reply or providing proper reasons.Court Decision:The High Court observed that the show cause notice was a cyclostyled notice without specific allegations and that there were serious discrepancies between the allegations in the show cause notice and the reasons recorded in the cancellation order. The authority had not considered the petitioner’s reply or provided any particulars of defects or objections.The Court held that the authority acted in a casual and mechanical manner without properly exercising jurisdiction under the CGST Act. Accordingly, the impugned order dated 28.10.2022 cancelling the GST registration was quashed and set aside, and the petitioner’s GST registration was restored.
Facts:The petitioner challenged the order dated 25.04.2025 passed by the appellate authority rejecting the appeal filed under Section 107 of the GST Act on the ground of delay. Against the original order dated 12.08.2024, the petitioner had filed a rectification application under Section 161 on 05.11.2024 which was rejected on 19.03.2025. The petitioner thereafter filed an appeal on 25.03.2025.Court Decision:The Court held that the rectification application filed under Section 161 and its disposal is a relevant factor for computing the limitation period for filing an appeal under Section 107. The limitation would start from the date of rejection of the rectification application.Since the rectification application was rejected on 19.03.2025 and the appeal was filed on 25.03.2025, the appeal was within time. The appellate authority failed to consider this aspect and erroneously rejected the appeal as time-barred. The Court therefore quashed the appellate order dated 25.04.2025 and remanded the matter to the appellate authority to decide the appeal afresh after granting opportunity of hearing.Cases Referred by Court:· M/s SPK and Co. v. State Tax Officer, W.P.(MD) No.27787 of 2024, Madras High Court, Order dated 22.11.2024
New Kailash Suppliers vs State of Gujarat & Ors. 29-01-2026
Facts:The petitioner challenged the order dated 25.04.2025 passed by the appellate authority rejecting the appeal filed under Section 107 of the GST Act on the ground of delay. Against the original order dated 12.08.2024, the petitioner had filed a rectification application under Section 161 on 05.11.2024 which was rejected on 19.03.2025. The petitioner thereafter filed an appeal on 25.03.2025.Court Decision:The Court held that the rectification application filed under Section 161 and its disposal is a relevant factor for computing the limitation period for filing an appeal under Section 107. The limitation would start from the date of rejection of the rectification application.Since the rectification application was rejected on 19.03.2025 and the appeal was filed on 25.03.2025, the appeal was within time. The appellate authority failed to consider this aspect and erroneously rejected the appeal as time-barred. The Court therefore quashed the appellate order dated 25.04.2025 and remanded the matter to the appellate authority to decide the appeal afresh after granting opportunity of hearing.Cases Referred by Court:· M/s SPK and Co. v. State Tax Officer, W.P.(MD) No.27787 of 2024, Madras High Court, Order dated 22.11.2024
Facts:The petitioner received a show cause notice dated 12.06.2024 proposing levy of tax and penalty for the tax periods 2018-19 to 2020-21. The petitioner challenged the notice before the High Court contending that a single show cause notice cannot be issued covering multiple assessment periods or financial years.Court Decision:The High Court held that assessment proceedings for each taxation period or financial year must be initiated through separate show cause notices. Since the impugned notice covered multiple taxation periods in a single show cause notice, the Court set aside the notice following the earlier judgment of the same Court. The writ petition was allowed with liberty to the authorities to initiate proceedings in accordance with law.Cases Referred by Court:• S.J Constructions vs. Assistant Commissioner & Ors.
Uber India Systems Private Limited vs. Deputy Commissioner of Central Tax & Ors. 28-01-2026
Facts:The petitioner received a show cause notice dated 12.06.2024 proposing levy of tax and penalty for the tax periods 2018-19 to 2020-21. The petitioner challenged the notice before the High Court contending that a single show cause notice cannot be issued covering multiple assessment periods or financial years.Court Decision:The High Court held that assessment proceedings for each taxation period or financial year must be initiated through separate show cause notices. Since the impugned notice covered multiple taxation periods in a single show cause notice, the Court set aside the notice following the earlier judgment of the same Court. The writ petition was allowed with liberty to the authorities to initiate proceedings in accordance with law.Cases Referred by Court:• S.J Constructions vs. Assistant Commissioner & Ors.
