Facts (Background):The petitioner purchased rubber products from a supplier and paid GST amounting to ₹1,11,60,830 to the supplier during July 2017 to January 2019. Investigation revealed that the supplier filed GSTR-1 showing sales but did not deposit the GST with the Government while filing GSTR-3B returns. The department issued a show cause notice under Section 73 alleging wrongful availment of ITC and confirmed the demand along with interest and penalty.Court Decision:The High Court held that Section 16(2)(c) of the CGST Act requires that ITC can be availed only when tax charged on the supply has actually been paid to the Government. However, the Court observed that a purchasing dealer has no mechanism to verify whether the supplier has deposited the tax with the Government and cannot control the supplier’s compliance.The Court held that denial of ITC to a bona fide purchaser who has paid tax to the supplier would impose an impossible and disproportionate burden and would defeat the objective of ITC, which is to avoid double taxation. Accordingly, the Court held that Section 16(2)(c) is constitutionally valid but must be read down so that ITC cannot be denied in bona fide transactions where the purchaser has paid GST to the supplier and there is no fraud or collusion.Since the proceedings against the petitioner were initiated under Section 73 and there was no allegation of fraud or collusion, the transaction was held to be bona fide. The impugned order dated 17.05.2022 denying ITC was set aside and the respondents were directed to allow ITC of ₹1,11,60,830 to the petitioner.Cases Referred by Court:B.R. Enterprises vs. State of U.P.CST vs. RadhakrishanOn Quest Merchandising India Pvt. Ltd. vs. Government of NCT of DelhiCommissioner of Trade and Tax, Delhi vs. Arise India Ltd.Shanti Kiran India (P) Ltd. vs. Commissioner Trade and Tax, DelhiCommissioner of Trade and Tax, Delhi vs. Shanti Kiran India (P) Ltd.National Plasto Moulding vs. State of AssamMcLeod Russel India Ltd. vs. Union of IndiaLaxmipat Singhania vs. CITMahaveer Kumar Jain vs. CITJain Brothers vs. Union of India
Sahil Enterprises vs. Union of India & Ors. 06-01-2026
Facts (Background):The petitioner purchased rubber products from a supplier and paid GST amounting to ₹1,11,60,830 to the supplier during July 2017 to January 2019. Investigation revealed that the supplier filed GSTR-1 showing sales but did not deposit the GST with the Government while filing GSTR-3B returns. The department issued a show cause notice under Section 73 alleging wrongful availment of ITC and confirmed the demand along with interest and penalty.Court Decision:The High Court held that Section 16(2)(c) of the CGST Act requires that ITC can be availed only when tax charged on the supply has actually been paid to the Government. However, the Court observed that a purchasing dealer has no mechanism to verify whether the supplier has deposited the tax with the Government and cannot control the supplier’s compliance.The Court held that denial of ITC to a bona fide purchaser who has paid tax to the supplier would impose an impossible and disproportionate burden and would defeat the objective of ITC, which is to avoid double taxation. Accordingly, the Court held that Section 16(2)(c) is constitutionally valid but must be read down so that ITC cannot be denied in bona fide transactions where the purchaser has paid GST to the supplier and there is no fraud or collusion.Since the proceedings against the petitioner were initiated under Section 73 and there was no allegation of fraud or collusion, the transaction was held to be bona fide. The impugned order dated 17.05.2022 denying ITC was set aside and the respondents were directed to allow ITC of ₹1,11,60,830 to the petitioner.Cases Referred by Court:B.R. Enterprises vs. State of U.P.CST vs. RadhakrishanOn Quest Merchandising India Pvt. Ltd. vs. Government of NCT of DelhiCommissioner of Trade and Tax, Delhi vs. Arise India Ltd.Shanti Kiran India (P) Ltd. vs. Commissioner Trade and Tax, DelhiCommissioner of Trade and Tax, Delhi vs. Shanti Kiran India (P) Ltd.National Plasto Moulding vs. State of AssamMcLeod Russel India Ltd. vs. Union of IndiaLaxmipat Singhania vs. CITMahaveer Kumar Jain vs. CITJain Brothers vs. Union of India
Facts (Background):An FIR was registered by the Economic Offences Wing, Delhi Police alleging that the accused induced a large number of investors by falsely claiming divine powers to triple their money. Around 1,852 victims were cheated of approximately ₹46.40 crores. The police registered a single FIR and treated complaints of other victims as statements during investigation. The Delhi High Court held that each deposit constituted a separate transaction requiring separate FIRs.Court Decision:The Supreme Court held that the reference made by the Additional Sessions Judge to the High Court was premature as the investigation had not concluded. The Court observed that whether multiple acts constitute the “same transaction” must be determined based on the facts emerging from the investigation.The Court noted that when offences arise from a common conspiracy and may form part of the same transaction, it is permissible to register one FIR and treat subsequent complaints as statements under Section 161 CrPC. The police were justified in registering a single FIR alleging criminal conspiracy under Section 120B IPC and treating complaints of other victims as statements.The Court clarified that the Magistrate will determine at the stage of framing of charges whether the acts constitute the same transaction under Sections 220(1) and 223 CrPC, enabling joint trial. If the acts are distinct transactions, separate trials may be conducted subject to Section 219 CrPC.Accordingly, the Supreme Court set aside the Delhi High Court’s answers which mandated separate FIRs for each transaction and allowed the appeal filed by the State.Cases Referred by Court:• S. Swamirathnam vs. State of Madras• Banwarilal Jhunjhunwala vs. Union of India• State of Andhra Pradesh vs. Cheemalapati Ganeswara Rao• State of Jharkhand vs. Lalu Prasad Yadav• Amish Devgan vs. Union of India• T.T. Antony vs. State of Kerala• Arnab Ranjan Goswami vs. Union of India• Abhishek Singh Chauhan vs. Union of India• Amanat Ali vs. State of Karnataka• Ravinder Singh Sidhu vs. State of Punjab• Alok Kumar vs. State of Bihar• Satinder Singh Bhasin vs. State of Uttar Pradesh• Radhey Shyam vs. State of Haryana• Amandeep Singh Saran vs. State of Delhi• Narinderjit Singh Sahni vs. Union of India
The State (NCT) of Delhi vs. Khimji Bhai Jadeja 06-01-2026
Facts (Background):An FIR was registered by the Economic Offences Wing, Delhi Police alleging that the accused induced a large number of investors by falsely claiming divine powers to triple their money. Around 1,852 victims were cheated of approximately ₹46.40 crores. The police registered a single FIR and treated complaints of other victims as statements during investigation. The Delhi High Court held that each deposit constituted a separate transaction requiring separate FIRs.Court Decision:The Supreme Court held that the reference made by the Additional Sessions Judge to the High Court was premature as the investigation had not concluded. The Court observed that whether multiple acts constitute the “same transaction” must be determined based on the facts emerging from the investigation.The Court noted that when offences arise from a common conspiracy and may form part of the same transaction, it is permissible to register one FIR and treat subsequent complaints as statements under Section 161 CrPC. The police were justified in registering a single FIR alleging criminal conspiracy under Section 120B IPC and treating complaints of other victims as statements.The Court clarified that the Magistrate will determine at the stage of framing of charges whether the acts constitute the same transaction under Sections 220(1) and 223 CrPC, enabling joint trial. If the acts are distinct transactions, separate trials may be conducted subject to Section 219 CrPC.Accordingly, the Supreme Court set aside the Delhi High Court’s answers which mandated separate FIRs for each transaction and allowed the appeal filed by the State.Cases Referred by Court:• S. Swamirathnam vs. State of Madras• Banwarilal Jhunjhunwala vs. Union of India• State of Andhra Pradesh vs. Cheemalapati Ganeswara Rao• State of Jharkhand vs. Lalu Prasad Yadav• Amish Devgan vs. Union of India• T.T. Antony vs. State of Kerala• Arnab Ranjan Goswami vs. Union of India• Abhishek Singh Chauhan vs. Union of India• Amanat Ali vs. State of Karnataka• Ravinder Singh Sidhu vs. State of Punjab• Alok Kumar vs. State of Bihar• Satinder Singh Bhasin vs. State of Uttar Pradesh• Radhey Shyam vs. State of Haryana• Amandeep Singh Saran vs. State of Delhi• Narinderjit Singh Sahni vs. Union of India
Facts :The petitioners challenged assessment orders and show cause notices imposing late fee under Section 47 and penalty under Section 125 of GST Acts for delayed filing of returns. They sought benefit of Amnesty Notification No.07/2023-Central Tax dated 31.03.2023, which reduced/waived late fee for specified periods. Some petitioners had filed returns within the amnesty window, while others filed before or after the prescribed period. They contended that imposition of both late fee and general penalty was illegal and contrary to the scheme of the Act.Court Decision:The Court held that late fee under Section 47 is a specific penalty for delay in filing returns and once imposed, general penalty under Section 125 cannot be levied for the same default. Imposition of general penalty in addition to late fee was set aside as unsustainable. The Court upheld applicability of Amnesty Notification No.07/2023 (as amended) only to those who satisfied the conditions specified therein, including filing within the prescribed period. Relief was granted by directing re-computation of late fee in accordance with the notification wherever applicable and by quashing improper penalty components.Cases Referred:Tvl. Jainsons Castors and Industrial Products vs The Assistant Commissioner (ST), Nandanam, Chennai
Kandan Hardware Mart & Others vs The Assistant Commissioner (ST) & Others 02-01-2026
Facts :The petitioners challenged assessment orders and show cause notices imposing late fee under Section 47 and penalty under Section 125 of GST Acts for delayed filing of returns. They sought benefit of Amnesty Notification No.07/2023-Central Tax dated 31.03.2023, which reduced/waived late fee for specified periods. Some petitioners had filed returns within the amnesty window, while others filed before or after the prescribed period. They contended that imposition of both late fee and general penalty was illegal and contrary to the scheme of the Act.Court Decision:The Court held that late fee under Section 47 is a specific penalty for delay in filing returns and once imposed, general penalty under Section 125 cannot be levied for the same default. Imposition of general penalty in addition to late fee was set aside as unsustainable. The Court upheld applicability of Amnesty Notification No.07/2023 (as amended) only to those who satisfied the conditions specified therein, including filing within the prescribed period. Relief was granted by directing re-computation of late fee in accordance with the notification wherever applicable and by quashing improper penalty components.Cases Referred:Tvl. Jainsons Castors and Industrial Products vs The Assistant Commissioner (ST), Nandanam, Chennai
The petitioners challenged assessment orders and show cause notices imposing late fee under Section 47 and penalty under Section 125 of GST Acts for delayed filing of returns. They sought benefit of Amnesty Notification No.07/2023-Central Tax dated 31.03.2023, which reduced/waived late fee for specified periods. Some petitioners had filed returns within the amnesty window, while others filed before or after the prescribed period. They contended that imposition of both late fee and general penalty was illegal and contrary to the scheme of the Act.Court Decision:The Court held that late fee under Section 47 is a specific penalty for delay in filing returns and once imposed, general penalty under Section 125 cannot be levied for the same default. Imposition of general penalty in addition to late fee was set aside as unsustainable. The Court upheld applicability of Amnesty Notification No.07/2023 (as amended) only to those who satisfied the conditions specified therein, including filing within the prescribed period. Relief was granted by directing re-computation of late fee in accordance with the notification wherever applicable and by quashing improper penalty components.Cases Referred:Tvl. Jainsons Castors and Industrial Products vs The Assistant Commissioner (ST), Nandanam, Chennai
Kandan Hardware Mart & Others vs The Assistant Commissioner (ST) & Others 02-01-2026
The petitioners challenged assessment orders and show cause notices imposing late fee under Section 47 and penalty under Section 125 of GST Acts for delayed filing of returns. They sought benefit of Amnesty Notification No.07/2023-Central Tax dated 31.03.2023, which reduced/waived late fee for specified periods. Some petitioners had filed returns within the amnesty window, while others filed before or after the prescribed period. They contended that imposition of both late fee and general penalty was illegal and contrary to the scheme of the Act.Court Decision:The Court held that late fee under Section 47 is a specific penalty for delay in filing returns and once imposed, general penalty under Section 125 cannot be levied for the same default. Imposition of general penalty in addition to late fee was set aside as unsustainable. The Court upheld applicability of Amnesty Notification No.07/2023 (as amended) only to those who satisfied the conditions specified therein, including filing within the prescribed period. Relief was granted by directing re-computation of late fee in accordance with the notification wherever applicable and by quashing improper penalty components.Cases Referred:Tvl. Jainsons Castors and Industrial Products vs The Assistant Commissioner (ST), Nandanam, Chennai
Facts :The petitioners challenged adjudication orders passed under the CGST/UPGST Acts on the ground that neither show cause notices nor orders were effectively served, as they were only uploaded on the GST portal. They contended that they became aware of the orders only during recovery proceedings, by which time the limitation period for appeal had expired. The revenue raised a preliminary objection on maintainability, citing availability of alternative remedy. The issue arose whether such portal upload amounts to valid “communication” triggering limitation.Court Decision:The Court examined Section 169 of the GST Acts along with the concept of “communication” under Section 107 and provisions of the Information Technology Act. It held that mere uploading of notices/orders on the GST portal does not automatically amount to proper communication unless it results in effective service. The Court recognized widespread issues of non-service and denial of opportunity, affecting the right to appeal and principles of natural justice. It entertained the writ petitions despite alternative remedy and adopted a consistent approach of setting aside such ex parte adjudication orders subject to conditions, with directions to provide notices, allow filing of replies, and grant opportunity of hearing before passing fresh orders.Cases Referred:Commissioner of Customs & Central Excise v. Hongo India Pvt. Ltd.Assistant Commissioner (CT) LTU, Kakinada v. Glaxo Smith Kline Consumer Health Care Ltd.M/s Riya Construction v. State of U.P.Mahaveer Trading Company v. Deputy Commissioner State TaxM/s Shubham Steel Traders v. State of U.P.
Bambino Agro Industries Ltd. v. State of Uttar Pradesh & Another 19-12-2025
Facts :The petitioners challenged adjudication orders passed under the CGST/UPGST Acts on the ground that neither show cause notices nor orders were effectively served, as they were only uploaded on the GST portal. They contended that they became aware of the orders only during recovery proceedings, by which time the limitation period for appeal had expired. The revenue raised a preliminary objection on maintainability, citing availability of alternative remedy. The issue arose whether such portal upload amounts to valid “communication” triggering limitation.Court Decision:The Court examined Section 169 of the GST Acts along with the concept of “communication” under Section 107 and provisions of the Information Technology Act. It held that mere uploading of notices/orders on the GST portal does not automatically amount to proper communication unless it results in effective service. The Court recognized widespread issues of non-service and denial of opportunity, affecting the right to appeal and principles of natural justice. It entertained the writ petitions despite alternative remedy and adopted a consistent approach of setting aside such ex parte adjudication orders subject to conditions, with directions to provide notices, allow filing of replies, and grant opportunity of hearing before passing fresh orders.Cases Referred:Commissioner of Customs & Central Excise v. Hongo India Pvt. Ltd.Assistant Commissioner (CT) LTU, Kakinada v. Glaxo Smith Kline Consumer Health Care Ltd.M/s Riya Construction v. State of U.P.Mahaveer Trading Company v. Deputy Commissioner State TaxM/s Shubham Steel Traders v. State of U.P.
Facts (Background):Audit reports dated 06.12.2022 and 22.02.2023 were issued in respect of the petitioner. Based on the audit observations, the respondent issued a revision notice dated 05.11.2025 under Section 108(1) of the CGST/KGST Act proposing revision of the audit report. The petitioner challenged the notice contending that revision proceedings under Section 108 cannot be initiated merely to revise an audit report without first initiating proceedings under Sections 73 or 74 of the Act.Court Decision:The High Court held that Section 65(7) of the KGST Act provides that where an audit detects unpaid or short-paid tax or wrongful availment of input tax credit, the proper officer must initiate action under Section 73 or Section 74 of the Act. The Court observed that in the present case no proceedings under Sections 73 or 74 had been initiated prior to issuing the revision notice under Section 108.Following the earlier judgment of the same Court, the Court held that revisional powers under Section 108 cannot be invoked to revise an audit report in the absence of proceedings under Sections 73 or 74. Consequently, the revision notice dated 05.11.2025 was held to be without jurisdiction and was quashed, while granting liberty to the authorities to initiate appropriate proceedings in accordance with law.Cases Referred by Court:M/s Navayuga Engineering Company Limited vs. Joint Commissioner of Commercial TaxesRadha Krishan Industries vs. State of Himachal Pradesh
NL Tile Art Private Limited vs. Additional Commissioner of Commercial 18-12-2025
Facts (Background):Audit reports dated 06.12.2022 and 22.02.2023 were issued in respect of the petitioner. Based on the audit observations, the respondent issued a revision notice dated 05.11.2025 under Section 108(1) of the CGST/KGST Act proposing revision of the audit report. The petitioner challenged the notice contending that revision proceedings under Section 108 cannot be initiated merely to revise an audit report without first initiating proceedings under Sections 73 or 74 of the Act.Court Decision:The High Court held that Section 65(7) of the KGST Act provides that where an audit detects unpaid or short-paid tax or wrongful availment of input tax credit, the proper officer must initiate action under Section 73 or Section 74 of the Act. The Court observed that in the present case no proceedings under Sections 73 or 74 had been initiated prior to issuing the revision notice under Section 108.Following the earlier judgment of the same Court, the Court held that revisional powers under Section 108 cannot be invoked to revise an audit report in the absence of proceedings under Sections 73 or 74. Consequently, the revision notice dated 05.11.2025 was held to be without jurisdiction and was quashed, while granting liberty to the authorities to initiate appropriate proceedings in accordance with law.Cases Referred by Court:M/s Navayuga Engineering Company Limited vs. Joint Commissioner of Commercial TaxesRadha Krishan Industries vs. State of Himachal Pradesh
Facts (Background):The petitioner challenged the show cause notice in Form GST DRC-01 dated 23.09.2025 issued under Section 73 of the GST enactments for the tax period 2021-2022. The challenge was mainly on the ground that an earlier intimation in Form DRC-01A dated 06.05.2025 and a show cause notice dated 29.05.2025 had already been issued for the same tax period, and therefore another show cause notice could not be issued.Court Decision:The High Court held that there is no bar under the GST enactments for issuance of multiple show cause notices for the same tax period if they relate to different discrepancies or subject matters. The Court observed that the earlier proceedings and the impugned show cause notice dealt with different issues except for a limited overlap relating to exempt supplies.The Court further held that the petitioner should submit a reply to the impugned show cause notice and raise all permissible defences before the adjudicating authority. Accordingly, the writ petition challenging the show cause notice was dismissed, with liberty granted to the petitioner to file a reply within 30 days and contest the proceedings on merits.Cases Referred by Court:Duncans Industries Ltd. vs. Commissioner of Central Excise, New DelhiSimplex Infrastructures Ltd. vs. Commissioner of Service Tax, KolkataAvery India Ltd. vs. Union of IndiaM/s ALM Industries Limited vs. Assistant Commissioner (AE) Central Goods and ServicesH.A. Shah and Co. vs. Commissioner of Income TaxCommissioner of Income Tax vs. Kelvinator of India Ltd.Workmen of Cochin Port Trust vs. Board of Trustees of the Cochin Port TrustSingh Enterprises vs. Commissioner of Central Excise, Jamshedpur
Radiant Cash Management Services Ltd. vs. Commercial Tax Officer 18-12-2025
Facts (Background):The petitioner challenged the show cause notice in Form GST DRC-01 dated 23.09.2025 issued under Section 73 of the GST enactments for the tax period 2021-2022. The challenge was mainly on the ground that an earlier intimation in Form DRC-01A dated 06.05.2025 and a show cause notice dated 29.05.2025 had already been issued for the same tax period, and therefore another show cause notice could not be issued.Court Decision:The High Court held that there is no bar under the GST enactments for issuance of multiple show cause notices for the same tax period if they relate to different discrepancies or subject matters. The Court observed that the earlier proceedings and the impugned show cause notice dealt with different issues except for a limited overlap relating to exempt supplies.The Court further held that the petitioner should submit a reply to the impugned show cause notice and raise all permissible defences before the adjudicating authority. Accordingly, the writ petition challenging the show cause notice was dismissed, with liberty granted to the petitioner to file a reply within 30 days and contest the proceedings on merits.Cases Referred by Court:Duncans Industries Ltd. vs. Commissioner of Central Excise, New DelhiSimplex Infrastructures Ltd. vs. Commissioner of Service Tax, KolkataAvery India Ltd. vs. Union of IndiaM/s ALM Industries Limited vs. Assistant Commissioner (AE) Central Goods and ServicesH.A. Shah and Co. vs. Commissioner of Income TaxCommissioner of Income Tax vs. Kelvinator of India Ltd.Workmen of Cochin Port Trust vs. Board of Trustees of the Cochin Port TrustSingh Enterprises vs. Commissioner of Central Excise, Jamshedpur
Facts :The petitioner challenged an adjudication order dated 29 August 2024 arising from a show cause notice for FY 2019–2020, along with certain GST notifications extending limitation. The petitioner had filed a reply to the show cause notice but did not avail personal hearing. It contended that its reply was not properly considered and sought relief against the demand. The challenge to notifications was also part of a larger batch of cases pending before various High Courts and the Supreme Court.Court Decision:The Court held that the impugned order did not warrant interference under writ jurisdiction. It observed that the petitioner had filed a reply which was considered, and therefore the appropriate remedy was to file an appeal. The petition was disposed of granting liberty to file an appeal under Section 107 of the CGST Act by 31 January 2026 with pre-deposit, with a direction that such appeal shall not be rejected on limitation. The outcome was made subject to the decision of the Supreme Court in the pending SLP concerning validity of the notifications.Cases Referred:DJST Traders Private Limited v. Union of India & Ors.M/s HCC-SEW-MEIL-AAG JV v. Assistant Commissioner of State Tax & Ors.Engineers India Limited v. Union of India & Ors.
India Retail Mart v. Commissioner of DGST & Ors. 16-12-2025
Facts :The petitioner challenged an adjudication order dated 29 August 2024 arising from a show cause notice for FY 2019–2020, along with certain GST notifications extending limitation. The petitioner had filed a reply to the show cause notice but did not avail personal hearing. It contended that its reply was not properly considered and sought relief against the demand. The challenge to notifications was also part of a larger batch of cases pending before various High Courts and the Supreme Court.Court Decision:The Court held that the impugned order did not warrant interference under writ jurisdiction. It observed that the petitioner had filed a reply which was considered, and therefore the appropriate remedy was to file an appeal. The petition was disposed of granting liberty to file an appeal under Section 107 of the CGST Act by 31 January 2026 with pre-deposit, with a direction that such appeal shall not be rejected on limitation. The outcome was made subject to the decision of the Supreme Court in the pending SLP concerning validity of the notifications.Cases Referred:DJST Traders Private Limited v. Union of India & Ors.M/s HCC-SEW-MEIL-AAG JV v. Assistant Commissioner of State Tax & Ors.Engineers India Limited v. Union of India & Ors.
Facts:The petitioner, engaged in procurement and sale of edible oils, purchased oils in bulk and repacked them for sale at 5% GST. Due to higher GST rates on certain inputs, unutilised Input Tax Credit (ITC) accumulated, and refund was claimed under the inverted duty structure. Refund applications were rejected by authorities and appellate authority on the ground that input and output goods were the same. Aggrieved, the petitioner filed the present writ petition challenging rejection of refund.Court Decision:The High Court allowed the petition and set aside the impugned orders rejecting refund.Held that Section 54(3)(ii) of the CGST Act does not prohibit refund merely because input and output goods are the same.Refund is admissible if ITC accumulation is due to higher tax on inputs compared to output supply.Circular No. 135/05/2020 restricting refund where input and output are same was held inapplicable and later restriction removed by Circular No. 173/05/2022.The 2022 Circular being beneficial and clarificatory was held retrospectively applicable.“Net ITC” includes all inputs irrespective of tax rates as per Rule 89(5).Cases Referred by Court:Indian Oil Corporation Ltd. vs. Commissioner of CGST (Delhi High Court, 2023)Suchitra Components Ltd. vs. CCE, Guntur (2006)K.P. Varghese vs. Income Tax Officer (1981)Union of India vs. VKC Footsteps India Pvt. Ltd. (Supreme Court)Baker Hughes Asia Pacific Ltd. vs. Union of IndiaShivaco Associates vs. Joint Commissioner of State TaxBMG Informatics Pvt. Ltd. vs. Union of IndiaMalabar Fuel Corporation vs. ACCT & CEMO Industries vs. Union of IndiaEveready Spinning Mills Pvt. Ltd. vs. ACCT
South Indian Oil Corporation vs. The Assistant Commissioner, 12-12-2025
Facts:The petitioner, engaged in procurement and sale of edible oils, purchased oils in bulk and repacked them for sale at 5% GST. Due to higher GST rates on certain inputs, unutilised Input Tax Credit (ITC) accumulated, and refund was claimed under the inverted duty structure. Refund applications were rejected by authorities and appellate authority on the ground that input and output goods were the same. Aggrieved, the petitioner filed the present writ petition challenging rejection of refund.Court Decision:The High Court allowed the petition and set aside the impugned orders rejecting refund.Held that Section 54(3)(ii) of the CGST Act does not prohibit refund merely because input and output goods are the same.Refund is admissible if ITC accumulation is due to higher tax on inputs compared to output supply.Circular No. 135/05/2020 restricting refund where input and output are same was held inapplicable and later restriction removed by Circular No. 173/05/2022.The 2022 Circular being beneficial and clarificatory was held retrospectively applicable.“Net ITC” includes all inputs irrespective of tax rates as per Rule 89(5).Cases Referred by Court:Indian Oil Corporation Ltd. vs. Commissioner of CGST (Delhi High Court, 2023)Suchitra Components Ltd. vs. CCE, Guntur (2006)K.P. Varghese vs. Income Tax Officer (1981)Union of India vs. VKC Footsteps India Pvt. Ltd. (Supreme Court)Baker Hughes Asia Pacific Ltd. vs. Union of IndiaShivaco Associates vs. Joint Commissioner of State TaxBMG Informatics Pvt. Ltd. vs. Union of IndiaMalabar Fuel Corporation vs. ACCT & CEMO Industries vs. Union of IndiaEveready Spinning Mills Pvt. Ltd. vs. ACCT
Facts / Background:The petitioner challenged an appellate order dismissing its appeal as time-barred against an ex-parte adjudication order passed under Section 73 of the Act. Before filing appeal, the petitioner had filed a rectification application under Section 161, which was rejected. Thereafter, the appeal was filed under Section 107 within one month of rejection of the rectification application. The appellate authority dismissed the appeal as beyond limitation, refusing to exclude time spent in rectification proceedings. ________________________________________Court Decision:The Court held that although Section 14 of the Limitation Act does not apply in strict terms, its underlying principle applies to GST proceedings. It held that time spent bona fide in pursuing rectification under Section 161 must be excluded while computing limitation for appeal under Section 107. The Court clarified that such exclusion does not amount to condonation of delay but exclusion of time, and limitation continues to remain within statutory period. Accordingly, the appeal was held to be within limitation, the impugned order was set aside, and the appeal was restored for decision on merits. ________________________________________Cases Referred by Court:• M.P. Steel Corporation v. Commissioner of Central Excise • Commissioner of Customs & Central Excise v. Hongo India Pvt. Ltd. • Assistant Commissioner (CT) v. Glaxo Smith Kline Consumer Health Care Ltd. • Commissioner of Sales Tax v. Parson Tools and Plants • Consolidated Engineering Enterprises v. Irrigation Department • Union of India v. West Coast Paper Mills Ltd. • India Electric Works Ltd. v. James Mantosh • M/s SPK and Co. v. State Tax Officer • M/s Arvind Fashion Ltd. v. State of Haryana • Atlantis Intelligence Ltd. v. Union of India
Prakash Medical Stores v. Union of India & Ors. 12-12-2025
Facts / Background:The petitioner challenged an appellate order dismissing its appeal as time-barred against an ex-parte adjudication order passed under Section 73 of the Act. Before filing appeal, the petitioner had filed a rectification application under Section 161, which was rejected. Thereafter, the appeal was filed under Section 107 within one month of rejection of the rectification application. The appellate authority dismissed the appeal as beyond limitation, refusing to exclude time spent in rectification proceedings. ________________________________________Court Decision:The Court held that although Section 14 of the Limitation Act does not apply in strict terms, its underlying principle applies to GST proceedings. It held that time spent bona fide in pursuing rectification under Section 161 must be excluded while computing limitation for appeal under Section 107. The Court clarified that such exclusion does not amount to condonation of delay but exclusion of time, and limitation continues to remain within statutory period. Accordingly, the appeal was held to be within limitation, the impugned order was set aside, and the appeal was restored for decision on merits. ________________________________________Cases Referred by Court:• M.P. Steel Corporation v. Commissioner of Central Excise • Commissioner of Customs & Central Excise v. Hongo India Pvt. Ltd. • Assistant Commissioner (CT) v. Glaxo Smith Kline Consumer Health Care Ltd. • Commissioner of Sales Tax v. Parson Tools and Plants • Consolidated Engineering Enterprises v. Irrigation Department • Union of India v. West Coast Paper Mills Ltd. • India Electric Works Ltd. v. James Mantosh • M/s SPK and Co. v. State Tax Officer • M/s Arvind Fashion Ltd. v. State of Haryana • Atlantis Intelligence Ltd. v. Union of India
