Supreme Court & High Courts Weekly Round up

This weekly round-up analytically summarises the key stories of the Supreme Court & High Court cases reported at, from April 20th, 2024 to May 3rd, 2024. SUPREME COURT Compounding of Offence u/s 137 of Customs Act by CESTAT: SC directs Re-Consideration PRINCIPAL COMMISSIONER OF CUSTOMS vs KHAN SADAF CITATION: 2024 TAXSCAN (SC) 208 A Supreme Court Two-Judge Bench directed the Customs Excise and Service Tax Appellate Tribunal (CESTAT) to reconsider compounding offences under Section 137 of the Customs Act, 1962. Counsel Nisha Bagchi argued that CESTAT lacked jurisdiction for such matters, urging the High Court’s order’s reevaluation. Justices BV Nagarathna and Sanjay Karol declined interference, instructing the Chief Commissioner to review the compounding application promptly. They highlighted the option for a writ petition if either party remains dissatisfied. Relief to AIFACS: SC dismisses SLP filed by Income Tax Dept on Non-Explanation of Gross Delay THE COMMISSIONER OF INCOME TAX (EXEMPTIONS) vs ALL INDIA FINE ARTS AND CRAFTS SOCIETY CITATION:2024 TAXSCAN (SC) 209 The Supreme Court dismissed the Income Tax Department’s special leave petition against the All India Fine Arts and Crafts Society (AIFACS) due to a significant delay in filing and unsatisfactory explanation. The petition stemmed from a Delhi High Court judgment.

Justices BV Nagarathna and Sanjay Karol noted a delay of 597 days and rejected the condonation application, consequently dismissing the petition. HIGH COURTS Pre-deposit Done after Condonable Delay: Punjab and Haryana HC directs Hearing of Appeal, Calculates Limitation Period based on General Clauses Act M/s Splendor Landbase Limited vs Joint Commissioner of State Tax Gurugram and others CITATION: 2024 TAXSCAN (HC) 849 The case concerns an assessment order dated 30.05.2023, filed on 30.09.2023, within the four-month statutory limitation period, with provision for one-month condonation on reasonable grounds. Despite citing such grounds, the appellate authority rejected the application. Justices Sanjeev Prakash Sharma and Sudeepti Sharma noted the submission fell within the four-month limit per the General Clauses Act. They recognized additional justifications for the delay, warranting condonation within the authority’s powers. Consequently, the Punjab and Haryana High Court allowed the petition, remanding the case for reconsideration, with directions for the parties to appear before the appellate authority. Non-Refund of Differential 6% GST Liability Borne by Contractors for Works Contracts: Chhattisgarh HC directs Refund of Excess Tax Paid within 4 Months M/s Surana And Company Having Its Office At MIG 41 vs Union Of India Through The Secretary CITATION: 2024 TAXSCAN (HC) 850 Justice Rajani Dubey of the Chhattisgarh High Court directed the department to refund excess Goods and Services Tax (GST) paid by contractors at an 18% rate on Works Contracts.

The petitioners contested the imposition of this rate on contracts executed before 18.07.2022 and sought a declaration deeming the 18% GST rate inapplicable to pre-specified date contracts, with a refund request for the additional 6% GST paid. They argued that retrospective application of the increased rate was illegal and violated their fundamental rights. The Court directed petitioners to make fresh refund claims, instructing respondents to process these within four months. Noting documents supporting contractors’ claims, the Court stressed fairness in addressing grievances regarding retrospective GST rate application in works contracts. No Application filed for Release: Calcutta HC rejects plea for Release of Goods Seized under GST Law M/s. Kanak Timber House & Anr vs Assistant Commissioner of Sales Tax & Ors CITATION:   2024 TAXSCAN (HC) 851 The Calcutta High Court ruled that seized goods cannot be released through a writ petition unless an application under the Goods and Services Tax Act is made. Following Search and Seizure proceedings by the Revenue Department, the petitioner sought release of seized timber stock. The court referenced relevant case law, emphasizing the necessity of invoking GST Act provisions for release. Since the petitioner hadn’t filed such an application, the court declined intervention. Power of Assessing Authority under Income Tax Act to Decide Application for Release of Seized Assets not Automatically Abated after 120 Days: Allahabad HC Dipak Kumar Agarwal vs Assessing Officer And 4 Others CITATION: 2024 TAXSCAN (HC) 852 The Allahabad High Court ruled that the Assessing Authority’s power under the Income Tax Act to decide on the release of seized assets doesn’t automatically expire after 120 days.

The writ petition aimed to quash the seizure of Rs. 36,12,000/- under Section 132B(1)(i) of the Income Tax Act and sought release of the detained amount, along with due interest. The petitioner argued that the authority was obligated to examine the nature, source, and existing liabilities of the seized money within 120 days, as per the Act’s provisions. However, the Division Bench clarified that the provision is directory, not mandatory, allowing the Assessing Authority to continue considering the application beyond the stipulated period. The court emphasised the provision’s intent to prevent undue delays in releasing assets once their nature and source are explained, without mandating automatic release after 120 days. Kerala HC directs Highrich Directors to File Application for Transfer of Property Frozen u/s 17(1A) of PMLA HIGHRICH ONLINE SHOPPE PRIVATE LIMITED vs UNION OF INDIA REPRESENTED BY ITS SECRETARY CITATION: 2024 TAXSCAN (HC) 853 The Kerala High Court directed the directors of Highrich Private Limited to file an application for the transfer of frozen property under Section 17(1A) of the Prevention of Money Laundering Act, 2002 (PMLA). The Highrich scam, valued at over Rs 3,141 crore, is under investigation by the Enforcement Directorate (ED) for money laundering. The investigation also revealed violations under the Prize Chits and Money Circulation Schemes (Banning) Act, leading to the attachment of the firm’s assets.

A report submitted to the court indicated potential fraud amounting to Rs 1,630 crore. The court directed the adjudicating authority to consider and pass orders within 180 days from the date of freezing. Additionally, the directors were instructed to file an application for permission to transfer frozen property, and the authorized officer was directed to review the request, limiting the freezing order to the amount covered in the FIR. Stay Application against Assessment Order under Income Tax Act: Kerala HC stays Recovery Proceedings VENUGOPALAN NAIR KUTTAN PILLAI vs THE CENTRAL BOARD OF DIRECT TAXES DEPARTMENT OF REVENUE CITATION: 2024 TAXSCAN (HC) 854 The Kerala High Court single bench granted a stay on recovery proceedings against the assessee under the Income Tax Act, 1961, until a final decision is made on the appeal against the Assessment Order. Venugopalan Nair Kuttan Pillai, represented by K P Pradeep, T T Biju, T Thasmi, and M J Anoopa, sought relief from demands under Ext.P1 pending consideration of the stay petition by the appellate authority. Justice Gopinath P directed the respondent to review the stay application filed with the appeal, providing the petitioner an opportunity for a hearing within three months.

The Court ruled that recovery proceedings would remain suspended until a decision is made on the stay application. Denial of Claim of Deduction u/s 80 of Income Tax Act without stating Reason: Kerala HC directs to Stay Recovery Till Finalisation of Appeal KERALA STATE COMMERCIAL TAX DEPARTMENT STAFF HOUSING CO-OPERATIVE SOCIETY LTD vs THE CENTRAL BOARD OF DIRECT TAXES DEPARTMENT OF REVENUE CITATION: 2024 TAXSCAN (HC) 855 The Kerala High Court directed a stay on recovery until the finalization of an appeal against the denial of deduction under Section 80 of the Income Tax Act, 1961. The petitioner, Kerala State Commercial Tax Department Staff Housing Co-Operative Society Ltd, challenged an assessment order rejecting their deduction claim. The petitioner argued that the assessing officer overlooked a Supreme Court judgment. Justice Gopinath P instructed the Appellate Authority to expedite the appeal process and refrain from coercive actions against the petitioner until its disposal. The petitioner was represented by K P Pradeep, T T Biju, T Thasmi, and M J Anoopa, while the respondent was represented by Christopher Abraham and Sri P R Ajith Kumar.

Bombay HC directs Disciplinary Action against AO as no Order passed on Rectification Application under Income Tax Act for Six Years Pankaj Kailash Agarwal vs Assistant Commissioner Of Income Tax ) Officer CITATION: 2024 TAXSCAN (HC) 856 The Bombay High Court directed disciplinary action against an Assessing Officer for not acting on a rectification application under the Income Tax Act for six years. The petitioner argued that the delay was unjust as it was due to errors by their accountant, not intentional misconduct. Despite reminders, the officer didn’t resolve the matter. The petitioner’s plea under Section 264 was dismissed due to a time limit issue. The Court criticized the officer’s attitude, stressing the need for timely justice. They instructed disciplinary action and forwarded the order to the concerned authority. Bombay HC condemns Action of Designated Committee of straight away issuing Form SVLDRS 3, directs to Issue Form SVLDRS 2 and Afford Personal Hearing Metallurgical Services vs Union of India represented by the Secretary CITATION: 2024 TAXSCAN (HC) 857 The Bombay High Court invalidated Form SVLDRS 3 for being issued without Form SVLDRS 2, directing a designated committee to issue SVLDRS 2 and grant a personal hearing to the petitioner. The dispute stemmed from a Show Cause Notice alleging a discrepancy in tax returns, proposing a hefty demand.

The petitioner argued that turnover wasn’t nil as claimed and had already made substantial deposits. Despite filing under the Sabka Vishwas Scheme, the committee disallowed pre-deposit, violating scheme provisions. The court criticized the committee’s actions, citing breach of natural justice principles. Consequently, the High Court quashed Form SVLDRS 3 and ordered reconsideration within six weeks, with proper issuance of SVLDRS 2 and a personal hearing for the petitioner. Service Providers Rendering Services on which Tax is payable on Reverse Charge basis Constitutes Class of their Own: Delhi HC PACE SETTERS BUSINESS SOLUTIONS PVT. LTD. vs UNION OF INDIA AND ORS. CITATION: 2024 TAXSCAN (HC) 858 The Delhi High Court upheld the validity of Notifications imposing GST on reverse charge basis for recovery agent services. The petitioner challenged these Notifications, alleging discrimination and arbitrariness in denying input tax credit.

The Court rejected the petitioner’s arguments, stating that service providers under reverse charge constitute a distinct class. It affirmed that such classifications are permissible under Article 14 of the Constitution, as long as they are reasonable and have a rational nexus to their objective. One Day’s Notice for Hearing: Allahabad HC quashes Assessment Order enhancing House Tax Hotel President Through Its Partner vs State Of Up And 2 Others CITATION: 2024 TAXSCAN (HC) 859 The Allahabad High Court nullified an assessment order for increasing house tax due to inadequate notice period for the hearing. Despite seeking an adjournment, the petitioner was not granted sufficient time. The Court emphasised that notice and opportunity for response are crucial safeguards against arbitrary exercise of power. It criticised the authority for not providing proper notice and sufficient time for the petitioner to respond, violating principles of fairness and procedural justice. ITSC cannot grant immunity from Penalty and Prosecution without True Disclosure u/s 254C of Income Tax Act: Delhi HC PR. COMMISSIONER OF INCOME TAX (CENTRAL) 2 vs PANKAJ BUILDWELL LTD. CITATION: 2024 TAXSCAN (HC) 860 The Delhi High Court ruled that the Income Tax Settlement Commission (ITSC) cannot grant immunity from penalty and prosecution without true disclosure under section 254C of the Income Tax Act, 1961. In a case involving Pankaj Buildwell Ltd & Group, engaged in real estate business, the ITSC admitted settlement applications disclosing additional income. However, the ITSC’s order, granting immunity from penalty and prosecution under Section 245H of the Act, was deemed contrary to stipulated conditions. The Court observed that revising the application would undermine the requirement of full and true disclosure, and thus set aside the ITSC’s order

. Demand of Late Fee for Belated GSTR 9 C is not valid as CGST Notification waived it: Kerala HC allows Refund of Late Fee paid ANISHIA CHANDRAKANTH vs THE SUPERINTENDENT CITATION: 2024 TAXSCAN (HC) 861 The Kerala High Court ruled that late fees for belated GSTR 9C filings are invalid due to a CGST notification waving them and allowing refunds for fees already paid. The petitioner, Anishia Chandrakanth, a proprietorship dealer under CGST/SGST Act, didn’t file returns on time. Despite objections, the court confirmed a late fee demand, which the petitioner partially paid. An amnesty scheme waived late fees over Rs. 10,000, but the court denied refunds for fees already paid beyond this amount. Attachment on Cash Credit of Assessee under GST Act: Delhi HC directs Bank to Comply Instructions to Vacate M/S SANT STEEL AND ALLOYS PRIVATE LIMITED vs DIRECTORATE GENERAL OF GOODS AND SERVICES TAX INTELLIGANCE CITATION: 2024 TAXSCAN (HC) 862 The Delhi High Court instructed Canara Bank to comply with the order to vacate attachment on the assessee’s cash credit under the GST Act, 2017. M/S Sant Steel And Alloys Private Limited petitioned against the attachment, which was later vacated after filing the petition. Canara Bank was directed to follow the instructions issued by the Principal Additional Director General. Madras HC dismisses Petition against GST Order based on Withdrawal of Petition by Assesee M/s.Priya Alloys vs The Assistant Commissioner (ST)(FAC) CITATION: 2024 TAXSCAN (HC) 863 The Madras High Court dismissed a GST Order petition after the assessee withdrew it. Counsel for the petitioner, M/s.Priya Alloys, stated that the matter was rendered infructuous and withdrew the petition.

Justice Senthilkumar Ramamoorthy dismissed the petition without any order as to costs. Appeal against GST Order: Kerala HC Stays Recovery Proceedings Till Final Decision of Appeal YEM PEE YEN TRADE LINKS vs DEPUTY STATE TAX OFFICER CITATION: 2024 TAXSCAN (HC) 864 The Kerala High Court stayed recovery proceedings pending appeal against a GST Order. Yem Pee Yen Trade Links, the petitioner, withdrew the writ petition with liberty to file an appeal against the order. The court ruled that no recovery should be made until the appeal is filed within the statutory period. If the petitioner files an appeal and deposits 10% of the assessed tax, further recovery will automatically stay as per statute. Proper Officer Failed to Consider Reply of Assessee: Delhi HC sets aside GST Order Denying  ITC Claim SURINDER KUMAR GARG PROPRIETOR SHRI BALAJI POLYMERS vs THE UNION OF INDIA REVENUE SECRETARY CITATION: 2024 TAXSCAN (HC) 865 The Delhi High Court overturned a GST order denying Input Tax Credit (ITC) claim because the Proper Officer didn’t consider the assessee’s reply. Surinder Kumar Garg, the petitioner, challenged the order proposing a demand of Rs.2,60,20,062.00. The court ruled that the Proper Officer must assess the reply on its merits before forming an opinion. The matter was remitted to the Proper Officer for re-adjudication. A division bench of Justice Sanjeev Sachdeva and Justice Ravinder Dudeja remitted the matter to the Proper Officer for re-adjudication. Duplication Found in Turnover Reconciliation and GSTR 3B and Form 26AS: Madras HC sets aside GST Demand Order on Pre-deposit Condition Vadim Infrastructure Private Limited vs The Commercial Tax Officer CITATION: 2024 TAXSCAN (HC) 866 Vadim Infrastructure Private Limited, involved in engineering and construction, challenged an assessment order primarily for breaching natural justice. The petitioner clarified concerns regarding turnover reconciliation and differences between GSTR 3B return and Form 26AS.

The court acknowledged potential issues and granted another opportunity for the petitioner to contest the tax demands. Conditions were set for remitting disputed tax amounts from the petitioner’s bank account. The attachment of the account would be lifted upon realization of the specified amounts. The petitioner was directed to submit necessary documents within three weeks, and the second respondent was instructed to issue a new order within two months after affording a fair chance to the petitioner, including a personal hearing. PMLA Offence, Rs.1 Crore Duped to Getting Approval /Clearance from Govt Agencies: Orissa HC Release Accused under Stringent Condition Surjit Kumar Dhal VS State Of Odisha (EOW) CITATION: 2024 TAXSCAN (HC) 867 The Orissa High Court granted bail to Surjit Kumar Dhal, a senior journalist accused under PMLA, citing cooperation with investigations and lack of prior criminal history. The allegations involve duping Rs. 1 crore for securing government approvals. Dhal, the Editor-in-Chief of “Reporters Today” and “Mahabharat,” was released on stringent conditions, including a bail bond of Rs. 1,00,000 and cash security of Rs. 10,00,000 to be kept in a Nationalized bank until trial conclusion.

The court deemed the specific nature of allegations and Dhal’s cooperation sufficient for bail. Refund Claim of Additional GST Paid than agreed contracted amount due to Introduction of GST: Chhattisgarh HC directs to file Fresh Claim M/s Surana And Company vs Union Of India CITATION: 2024 TAXSCAN (HC) 868 The Chhattisgarh High Court directed the petitioner, a construction company, to file a fresh claim for refund of Additional GST paid due to changes in contracted amounts after the introduction of GST. The court instructed the respondents to process the claim promptly and reimburse the additional tax burden incurred by the petitioner. The writ petition was disposed of accordingly. Timely GST Due Paid w.r.t. Disparity in GSTR 1 & GSTR 3B ignored by Officer despite Noticing: Madras HC remands for Reconsideration Tvl. Kavinkumar Textiles vs Deputy State Tax Officer-I CITATION: 2024 TAXSCAN (HC) 869 The Madras High Court ordered a reconsideration of a case involving timely payment of GST dues, addressing discrepancies between GSTR 1 and GSTR 3B. Despite acknowledging prompt payment, officers overlooked this fact.

The petitioner received intimation and a show cause notice, replying duly. The court observed errors in the respondent’s conclusions, particularly regarding timely payments and reversal of Input Tax Credit. Upon review, the court found contradictions in the respondent’s assertions and set aside the contested order, remanding the matter for reconsideration. The writ petition was disposed of accordingly. Challenges GST Liability Intimation on Seigniorage Fee Paid to Government: Madras HC demands Reply for Intimation within 4 Weeks Tvl. AVS Tech Building Solutions vs The Deputy State Tax Officer CITATION: 2024 TAXSCAN (HC) 870 The Madras High Court directed AVS Tech Building Solutions to file a reply to the GST intimation regarding the Seigniorage Fee Paid to Government within four weeks.

The petitioner challenged the intimation and cited a Division Bench judgment, which directed petitioners to submit objections within four weeks and suspended adjudication until a Nine Judge Constitution Bench decides on royalty issues. Justice Senthilkumar Ramamoorthy disposed of the petitions on similar terms, allowing the petitioner to submit a reply within four weeks. 100% Penalty Imposed Despite GST Liability Discharge: Madras HC disposes WP on Pre-Deposit Condition for Interest Liability M/s.Alamelu Construction vs The Assistant Commissioner of GST CITATION: 2024 TAXSCAN (HC) 871 The Madras High Court disposed of a writ petition regarding a pre-deposit requirement for interest linked to a 100% penalty imposed despite the discharge of GST liability. The petitioner settled the GST liability on three occasions before the show cause notice. The court allowed the petitioner to file a statutory appeal, despite the time limit expiring, upon fulfilling the condition of remitting Rs.2.5 lakhs within three weeks. No costs were awarded. No Excuse for SCN Ignorance on Uploaded on “View Additional Notices and Orders” tab on GST Portal: Madras HC sets aside Order on Pre-deposit Condition K.A. & Co vs The State Tax Officer CITATION: 2024 TAXSCAN (HC) 872 The Madras High Court ruled that ignorance of a Show Cause Notice (SCN) uploaded on the GST portal is not an excuse. Despite the petitioner’s failure to respond to the notice, the court set aside the order for interference. The petitioner agreed to remit Rs.10,00,000/- as a condition for remand.

The court directed the petitioner to pay the amount within three weeks and allowed them to respond to the notice within the specified timeframe. Upon receipt of the reply and payment confirmation, the respondent must provide a fair opportunity for a personal hearing and issue a fresh order within three months. Penalty Imposed after Full GST and Interest Liability Discharged: Madras HC allows to file Statutory Appeal to Contest Penalty Order Sri.Balu Jayaraman vs The Assistant Commissioner (ST) CITATION:   2024 TAXSCAN (HC) 873 The Madras High Court granted the petitioner the opportunity to file a statutory appeal contesting the penalty imposed after discharging full GST and interest liability. Allegations of wrongful ITC availment led to the impugned order. The petitioner argued that no appeal was filed earlier because they discharged the tax and interest liability. Receipts showed payments made by the petitioner, settling the entire tax and interest liability stated in the order. The court permitted the petitioner to file a statutory appeal addressing only the penalty imposed within two weeks from receiving the court order. If filed within the specified period, the appellate authority will consider it on its merits without considering the question of limitation. Madras HC sets aside GST Assessment Order and Recovery Notice Over Personal Hearing Denial M/s. Prosign Communications vs The Deputy State Tax Officer III CITATION: 2024 TAXSCAN (HC) 874 The Madras High Court set aside the GST assessment order and recovery notice due to the denial of a mandatory Personal Hearing under Section 75(4) of the GST Act.

The petitioner’s counsel argued that the orders violated this section, which requires a personal hearing after a taxpayer’s response to a notice. The court agreed, finding that the respondent failed to provide the required hearing. Consequently, the challenged orders were overturned, and the matters were remanded for reconsideration with instructions to afford the petitioner a personal hearing. The recovery notice associated with the orders was invalidated, and the stay of recovery for pending appellate proceedings remained in force. The writ petition was disposed of accordingly. Adjudication of Discrepancies in GSTR 3B vs GSTR 2A ignoring Supplier and CA Certificates with Invoice Details: Madras High Court quashes GST Demand Order AP Studio Enterprises vs The Assistant Commissioner CITATION: 2024 TAXSCAN (HC) 875 The Madras High Court overturned a GST order due to the authorities not considering certificates from the supplier and Chartered Accountant, leading to a disparity in GSTR 3B & GSTR 2A. The order, dated 29.12.2023, stemmed from a Show Cause Notice issued on 29.09.2023, to which the petitioner responded on 16.10.2023, citing a discrepancy between their GSTR 3B return and GSTR 2A.

Technical issues prevented the reply’s upload, leading to the impugned order. Despite submitting certificates from the supplier and CA, recent rectification attempts were rejected. The court noted the petitioner’s efforts and additional evidence but emphasized that these were not considered in the impugned order. Consequently, Justice Senthilkumar Ramamoorthy set aside the order and remanded the matter to the respondent for reconsideration. The petitioner was granted 15 days to submit a reply with relevant documents, and the respondent was directed to provide a personal hearing and issue a fresh order within two months. Mandatory Condition of Pre-Deposit u/s 35F of CEA to file Appeals before CESTAT cannot be Waived in Writ Jurisdiction: Allahabad HC Ram Kishan Bairwa vs Central Excise Service Tax Appellate Tribunal And 2 Others CITATION: 2024 TAXSCAN (HC) 876 The Allahabad High Court ruled that the mandatory pre-deposit condition under Section 35F of the Central Excise Act, 1944, cannot be waived in writ jurisdiction. The petitioner, aggrieved by an order from the Commissioner, Central Goods and Service Tax, Ghaziabad, sought waiver of pre-deposit or relegation to appeal jurisdiction under Section 86 of the Finance Act, 1994. Citing Supreme Court and High Court judgments, the court emphasised that pre-deposit cannot be waived in extraordinary writ jurisdiction. The petitioner had already filed an appeal, making the writ petition an afterthought to evade pre-deposit liability.

The court noted that amendments to the law preclude High Courts from exercising discretion in waiving pre-deposit. Therefore, the petition was dismissed. Delhi HC Upholds Order of Income Tax Settlement Commission as Assesee made True and Full Disclosure of Income PR. COMMISSIONER OF I TAX VS M/S TRENT EAST WEST LPG BOTTLING LTD CITATION: 2024 TAXSCAN (HC) 877 The Delhi High Court upheld the order of the Income Tax Settlement Commission (ITSC), stating that the assessee made a true and full disclosure of income. The dispute centered around the character of a receipt, with the petitioner alleging it to be an accommodation entry. The ITSC settled the total tax liability for the respondent-assessee, M/S Trent East West LPG Bottling Ltd, for the block assessment period of 1995-96 to 25 May 2000, granting immunity from prosecution and penalties. The petitioner challenged the settlement order, alleging the respondent failed to disclose income related to a land parcel purchase. However, the court found that the ITSC considered both sides and made its decision within its adjudicatory function, warranting no interference under Article 226 of the Constitution. Thus, the writ petition was dismissed.

Reassessment Powers not to be exercised for purpose of re-verification or merry sailing for rowing inquiry: Gujarat HC PIYUSH AMBALAL GANDHI vs DY COMMISSIONER OF INCOME TAX CIRCLE 2 CITATION: 2022 TAXSCAN (HC) 878 The Gujarat High Court ruled that reassessment powers should not be used for mere re-verification or conducting fishing inquiries. Piyush Ambalal Gandhi, the petitioner, filed his income tax return with claims for rebate. However, the Assessing Officer issued a notice under Section 148 of the Income Tax Act, 1961, to reopen the assessment. The petitioner objected, stating no claim was made under Section 80CCC (1) of the Act. The court observed that the Assessing Officer’s actions amounted to a fishing inquiry, as information provided earlier was ignored. The reassessment powers should not be used for re-verification, as observed by the bench comprising Justice N V Anjaria and Justice Bhargav D Karia. Ketan Shah represented the petitioner, and Varun K. Patel represented the respondent. No application of S. 45 PMLA to S. 205 CrPC Application: Orissa HC allows resubmission of appearance exemption application in PMLA Case with alleged Proceeds less than 1 Cr Lalita Mohan Das vs Assistant Director, E.D CITATION: 2024 TAXSCAN (HC) 879 The Orissa High Court ruled that Section 45 of the Prevention of Money Laundering Act (PMLA) doesn’t apply if alleged crime proceeds are under Rs. 1 Crore, in a case concerning exemption from personal attendance under Section 205 of the Criminal Procedure Code (CrPC). Bibekananda Nayak, Special Counsel for the Enforcement Directorate, represented the case. The petitioner sought to quash an order denying exemption from personal attendance in a PMLA case.

Initially rejected by the trial court, the petitioner appealed under Section 482 of CrPC. The court, after considering relevant judgments and provisions, concluded that the trial court’s order was unsustainable. Arguments centered on Section 205 CrPC’s applicability in PMLA cases and the court’s discretion in granting exemption. The Orissa High Court set aside the order and remanded the matter for fresh consideration by the Sessions Judge-cum-Special Judge, Khurda at Bhubaneswar. Justice A.K. Mohapatra concluded the ruling, setting aside the impugned order. SCN without details or particular on Demand of GST is Invalid: Delhi HC quashes Order RAJESH KUMAR SINGHAL vs THE GOODS AND SERVICES TAX NETWORK & ORS CITATION: 2024 TAXSCAN (HC) 880 The Delhi High Court ruled that a  SCN lacking specific details regarding Goods and Service Tax (GST) demands is invalid. Represented by Dayaar Singla, the petitioner challenged the defective notice proposing the cancellation of their GST registration. The notice failed to specify the issuing authority or provide details of alleged infractions.

The court, presided over by Justice Sanjeev Sachdeva and Justice Ravinder Dudeja, found the SCN deficient, merely citing legal provisions without detailing the alleged violations. Consequently, the court quashed the notice, allowing the authorities to issue a proper one with specific infractions and providing the petitioner an opportunity for a personal hearing. Application for GST Cancellation Fails to Dispose of Timely on due to furnishing Details: Delhi HC allows Time to Furnish Details M/S JVN TRADERS PVT. LTD vs PRINCIPAL COMMISSIONER OF DEPARTMENT OF TRADE AND TAXES CITATION: 2024 TAXSCAN (HC) 881 In a recent case, the Delhi High Court allowed time for M/S JVN Traders Pvt Ltd to furnish details requested by the proper officer, as failure to do so caused a delay in processing their application for GST cancellation. The petitioner sought direction for the respondent to process their cancellation application, stating closure of their business. The respondent had sought clarifications and future communication address, which the petitioner agreed to provide within one week. Justices Sanjeev Sachdeva and Purushaindra Kumar Kaurav disposed of the petition, allowing the petitioner to furnish the details within one week. The proper officer was directed to decide on the application within four weeks thereafter.

One-Year Validity Application to Provisional Attachment Order u/s 83 (2) of CGST Act: Delhi HC directs not to Restrain Operations of Bank A/c KRISH OVERSEAS vs COMMISSIONER CENTRAL TAX-DELHI WEST & ORS CITATION: 2024 TAXSCAN (HC) 882 The Delhi High Court observed that the validity of a provisional attachment order under section 83(2) of the CGST Act, 2017, is one year. In the case of M/S Krish Overseas, the petitioner challenged a communication from 2019 directing HDFC Bank to seize their account funds. Since one year had passed, the court directed the bank not to restrain the account’s operation, as the order had ceased to be effective. Justices Sanjeev Sachdeva and Ravinder Dudeja declared the order from 2019 invalid and instructed HDFC Bank not to restrict the petitioner’s account based on it. Two SCN Demanding GST on Same Tax Period: Delhi HC directs to Re adjudicate after Clubbing of Two SCN DINESH KUMAR VARMA vs SALES TAX OFFICER CITATION: 2024 TAXSCAN (HC) 883 The Delhi High Court directed the re-adjudication of two show cause notices (SCNs) demanding GST for the same tax period, finding that they should be clubbed and re-adjudicated by one proper officer under the law. Dinesh Kumar Varma challenged an order under Section 73 of the CGST Act, 2017, where a demand of Rs. 15,53,240/- was created against him

The court observed that both SCNs pertained to the same tax period and raised identical demands by different officers of the same jurisdiction. Justices Sanjeev Sachdeva and Purushaindra Kumar Kaurav allowed the petition, instructing the petitioner to reply to both SCNs within 30 days. The proper officer shall then adjudicate the notices within the prescribed period. GST Registration cannot be Cancelled Retrospectively due to Non-Filing of Return for a continuous Period of Six Months: Delhi HC KALPANA CABLES PRODUCTS PVT. LTD vs THE COMMISSIONER, DEPARTMENT OF TRADES AND TAXES & ANR CITATION: 2024 TAXSCAN (HC) 884 The Delhi High Court ruled that GST registration cannot be cancelled retrospectively solely due to non-filing of returns for six months. Kalpana Cables Products Pvt. Ltd challenged the retrospective cancellation of its registration. The court modified the impugned order, declaring the registration cancelled from 30.04.2019, the date petitioner sought cancellation, rather than from 01.12.2017. The court emphasized that registration cannot be cancelled with retrospective effect mechanically and must be based on objective criteria. Justices Sanjeev Sachdeva and Purushaindra Kumar Kaurav made the decision, considering the circumstances and the petitioner’s application for cancellation.

Unexplainable Delay to Refund Amount under Delhi Sales Tax Act: Delhi HC directs to pay interest for 3 years from filing the Petition TARAPORE & CO vs COMMISSIONER OF TRADE & TAXES & ANR CITATION: 2024 TAXSCAN (HC) 885 The Delhi High Court directed the respondents to pay interest to Tarapore & Co. for the unexplained delay in refunding an amount under the Delhi Sales Tax Act, 1975. The court ruled that the petitioner would receive interest at a rate of 1.5% per month on the refund amount of Rs. 20,18,729/- for three years preceding the filing of the petition until the refund is disbursed. This decision was made by a division bench consisting of Justice Sanjeev Sachdeva and Justice Ravinder Dudeja. Refund Claim U/s 42 DVAT Act delayed: Delhi HC directs to Pay Simple Interest @ 6% M/S SATBIR FILING STATION vss DELHI VALUE ADDED TAX OFFICER WARD 101 & ORS. CITATION: 2024 TAXSCAN (HC) 886 The Delhi High Court directed M/S Satbir Filling Station to receive simple interest at 6% on the delayed refund allowed under the Delhi Value Added Tax Act, 2004.

Despite the delayed sanctioning of the refund without any interest, the court ruled in favor of the petitioner, citing Section 42(1) of the Act, which mandates the grant of simple interest. The division bench of Justice Sanjeev Sachdeva and Justice Ravinder Dudeja disposed of the petition, instructing the respondents to consider and disburse the interest to the petitioner within four weeks. If the proper officer decides interest is not payable, they must provide a reasoned order within the same timeframe. GST cancellation cannot be cancelled Retrospectively without any Cogent Reason: Delhi HC Sets aside Retrospective Cancellation of GST SUMEET SINGH LEGAL HEIR OF LATE SH. MOHINDER MOHAN SINGH vs COMMISSIONER OF DELHI GOODS AND SERVICES TAX AND ORS CITATION: 2024 TAXSCAN (HC) 887 The Delhi High Court invalidated the retrospective cancellation of GST registration due to lack of substantial reasons. The court found deficiencies in both the Show Cause Notice and the order. Sumeet Singh, the petitioner, challenged the dismissal of their appeal primarily on the grounds of limitation and contested the retrospective cancellation of GST registration effective from 01.07.2017.

The petitioner, representing M/s Saran Singh & Sons, engaged in spice and dry fruit supply, was registered under the Goods and Service Act, 2017. The Show Cause Notice lacked clarity and failed to notify the petitioner of the retrospective cancellation. The subsequent order lacked reasoning and arbitrarily set the cancellation date without specifying dues. The court modified the order, cancelling registration effective from Mohinder Mohan Singh’s demise on 16.10.2020. Cancellation of GST Retrospectively in Absence of Reply to Opportunity to Hear u/s  75(4) CGST Act granted through GST portal: Delhi HC sets aside Order M/S. VISHAL CHEM vs ASSISTANT COMMISSIONER, DEPARTMENT OF TRADE AND TAXES CITATION: 2024 TAXSCAN (HC) 888 The Delhi High Court overturned the retrospective cancellation of GST registration due to procedural irregularities. M/S. Vishal Chem, the petitioner, contested an order disposing of a Show Cause Notice proposing a demand of Rs. 34,51,018.00. The court noted that despite the petitioner’s detailed reply submitted and uploaded, the subsequent order failed to consider it adequately. Furthermore, the proper officer declined to accept additional documents tendered by the petitioner’s Chartered Accountant.

The court found that the officer did not adequately assess the petitioner’s reply and failed to provide an opportunity for clarification or further submission. Justices Sanjeev Sachdeva and Ravinder Dudeja directed the matter to be reconsidered by the proper officer. Claim of Excess ITC Rejected alleging improper Calculation/reconciliation: Delhi HC directs Re adjudication SPINCLABS PRIVATE LIMITED vs THE COMMISSIONER OF DELHI GOODS AND SERVICES TAX AND ORS. CITATION: 2024 TAXSCAN (HC) 889 The Delhi High Court directed the re-adjudication of two orders rejecting Spinclabs Private Limited’s claim of excess Input Tax Credit (ITC) due to alleged improper calculation/reconciliation. The court found that the proper officer failed to adequately consider the detailed replies submitted by the petitioner. Justices Sanjeev Sachdeva and Ravinder Dudeja observed that the officer did not apply due diligence in assessing the replies, which lacked proper calculations/reconciliation and relevant documents. Consequently, the court remitted the matter to the proper officer for re-adjudication.

The petitioner is instructed to file replies to the Show Cause Notices within 30 days. The proper officer is required to re-adjudicate the notices, provide an opportunity for a personal hearing, and issue a fresh speaking order in accordance with the law within the prescribed period under Section 75(3) of the Act. Kerala HC Directs to remit 15% total demand as per assessment order within period of one week DIANA PETER ALIAS DIANA GOMEZ vs COMMISSIONER OF INCOME TAX CITATION: 2024 TAXSCAN (HC) 890 The Kerala High Court directed Diana Peter Alias Diana Gomez to remit 15% of the total demand within one week. Diana filed an appeal, stay application, and application for condonation of delay against an assessment order under Section 147 read with Sections 144 and 144B of the Income Tax Act. Despite a 150-day delay in filing the appeal, the court directed the Income Tax Department to consider and decide on the delay condonation and stay application within two months. The demand remains pending until a decision on the delay condonation and stay petition, provided 15% of the total demand is deposited. Stay petition with respect to Assessment Order: Kerala HC directs ITAT to pass an order within period of 2 months REJI KRISHNA vs THE CENTRAL BOARD OF DIRECT TAXES CITATION: 2024 TAXSCAN (HC) 891 The Kerala High Court directed the Income Tax Appellate Tribunal (ITAT) to decide on a stay petition within two months while the assessment order remains stayed.

Reji Krishnan filed an appeal against an assessment order before the CIT(A), which was partially relieved. Subsequently, the petitioner appealed to the ITAT and filed a petition for stay of proceedings. After considering both sides, Judge Shoba Annamma Eapen instructed the ITAT to decide on the stay petition within two months from the receipt of the judgment copy. Failure to attend hearing fixed by SCN regarding ITC due to death of Husband: Delhi HC directs Re adjudication ANITA BANSAL PROPRIETRESS OF M/S A.B. ENTERPRISES vs THE UNION OF INDIA & ANR CITATION: 2024 TAXSCAN (HC) 892 In a significant case, the Delhi High Court directed re-adjudication due to the petitioner’s inability to attend the hearing fixed by the Show Cause Notice (SCN) following her husband’s death. Anita Bansal, Proprietress of M/S A.B. Enterprises, filed a writ petition against the order and SCN proposing a demand of Rs.21,11,088.00. The petitioner’s counsel, Rajesh Jain, explained that she couldn’t respond to the SCN because her husband passed away on the scheduled hearing date. The court observed that the petitioner’s inability to respond was due to her husband’s serious illness, thus entitling her to an opportunity to reply. Justices Sanjeev Sachdeva and Ravinder Dudeja set aside the order passed under Section 73 of the Central Goods and Services Tax Act, 2017, directing re-adjudication. Order passed u/s 73 CGST Act without provide opportunity for clarify reply with respect to SCN: Delhi HC directs Re adjudication DECOLENE FIBERS PVT. LTD. vs COMMISSIONER DGST AND ORS. CITATION: 2024 TAXSCAN (HC) 893

The Delhi High Court directed re-adjudication after finding that an order passed under Section 73 of the Central Goods and Services Tax Act lacked clarity and failed to consider the petitioner’s detailed reply to the show cause notice. The petitioner, Decolene Fibers Pvt. Ltd., challenged the order proposing a demand of Rs. 88,34,701.00. The court noted that the petitioner’s reply was not properly considered and no opportunity was given to clarify or provide further details. Justices Sanjeev Sachdeva and Ravinder Dudeja set aside the order and directed re-adjudication. Cryptic order passed without consider reply for SCN regarding ITC Claim: Delhi HC directs re adjudication KAYCEE POLYMERS PVT. LTD. vs THE UNION OF INDIA REVENUE SECRETARY & ORS. CITATION: 2024 TAXSCAN (HC) 894 In a significant case, the Delhi High Court directed re-adjudication, noting that an order passed without considering the petitioner’s detailed reply to a Show Cause Notice regarding Input Tax Claim was cryptic. The petitioner, Kaycee Polymers Pvt. Ltd., challenged the order under Section 73 of the CGST Act.

The court observed that the order failed to consider the petitioner’s reply and lacked justification. Justices Sanjeev Sachdeva and Ravinder Dudeja directed the petitioner to file a reply within 30 days and ordered the Proper Officer to re-adjudicate, allowing for a personal hearing and a fresh speaking order in accordance with the law. No Late Fee for GSTR 9 C Filing: Kerala HC ANISHIA CHANDRAKANTH vs THE SUPERINTENDENT CITATION: 2024 TAXSCAN (HC) 895 In a recent judgment, the Kerala High Court ruled that no late fee can be imposed for the late filing of GSTR-9C for the financial years 2017-18, 2018-19, and 2019-20. This decision offers significant relief to taxpayers facing challenges with late filing. The ruling also highlighted anomalies in the application of an amnesty scheme, retroactively benefiting those who had already filed their returns. Understanding these nuances is crucial for businesses, as late filing incurs penalties. This precedent ensures that compliant taxpayers are treated fairly, providing hope for those navigating GST regulations. No Addition to Net Profit to be Made without Recomputing Trading Result u/s 145(1) of Income Tax Act: Punjab & Haryana HC Shree Digvijaya Woollen Mills Ltd vs Commissioner of Income-Tax CITATION: 2024 TAXSCAN (HC) 896 The Punjab and Haryana High Court ruled that no addition can be made to net profit without recomputing trading results under Section 145(1) of the Income Tax Act, 1961. The Assessing Officer (A.O) had estimated wastage percentages without proper justification, leading to an erroneous addition to the assessee’s income.

The court emphasized that if the books of account, including the valuation of closing stock, are accepted by the A.O, additions to net profit cannot be made without re-computation. Therefore, the addition of Rs. 34,28,414/- for excessive shortage was deemed unsustainable by the court. Proper Officer Empowered to Grant Three Adjournments if Sufficient Cause shown under CGST Act: Delhi HC SUN & SAND INDUSTRIES AFRICA PVT. LTD vs SALES TAX OFFICER CLASS-II/AVATO DEPARTMENT OF TRADE AND TAXES CITATION: 2024 TAXSCAN (HC) 897 The Delhi High Court ruled that the Proper Officer under the Central Goods and Services Tax Act, 2017, can grant up to three adjournments if sufficient cause is shown. The petitioner challenged an order disposing of a Show Cause Notice and imposing a demand. Despite the petitioner’s requests for time and personal hearing, the order did not consider these requests. The court noted that while Section 75(5) allows for three adjournments, it is not mandatory, and the officer’s discretion depends on the circumstances of each case.

Discharge of Tax Liability: Madras HC Stays Proceedings WAN HAI LINES INDIA PVT.LTD. vs UNION OF INDIA CITATION: 2024 TAXSCAN (HC) 898 The Madras High Court granted interim stay on proceedings due to the discharge of tax liability, as challenged notifications under Section 168A of applicable GST laws are contested in the writ petition. The petitioner’s counsel pointed out that tax liability was indeed discharged, albeit under the wrong tax head. The court observed that Section 168A of the CGST Act allows the government to extend time limits in special circumstances, overriding conflicting provisions. Justice Senthilkumar Ramamoorthy ordered an interim stay on further proceedings until the matter is heard again, scheduling it for June 10, 2024. Cenvat Credit Allowable on Welding Electrodes, Welding Wire, used for Laying Rail Lines Outside Factory: Gujarat HC THE PRINCIPAL COMMISSIONER CENTRAL GST AND CENTRAL EXCISE vs M/S NAYARA ENERGY LTD. CITATION: 2024 TAXSCAN (HC) 899 The Gujarat High Court recently ruled that CENVAT credit is permissible on items like welding electrodes and welding wire used for laying rail lines outside the factory. The case revolved around whether the respondent assessee is entitled to such credits. The Commissioner initially denied the credit, arguing that these items were not used directly in manufacturing petroleum products. However, the CESTAT allowed the appeal, emphasizing that these items were indeed utilized in the manufacturing process.

The court upheld this decision, stating that items like M.S. Gratings, although not directly involved in manufacturing, are essential for plant operations and thus qualify for credit. Failure to Consider Certificate from Supplier: Madras HC quashes ITC Mismatch Demand AP Studio Enterprises vs The Assistant Commissioner (ST)(FAC) CITATION: 2024 TAXSCAN (HC) 900 The Madras High Court annulled the ITC mismatch demand due to the failure to consider a certificate from the supplier. The challenged order dated 29.12.2023 was based on a show cause notice from 29.09.2023, to which the petitioner responded by citing a delay in the supplier’s GSTR 1 filing. The petitioner also submitted certificates from the supplier and their Chartered Accountant, but the rectification petition was rejected. The court noted that these documents were not considered in the impugned order and remanded the matter to the respondent for reconsideration.

The petitioner was granted 15 days to submit a reply with all relevant documents, and the respondent was directed to issue a fresh order within two months after considering the petitioner’s submission. Denial of ITC to Customers is Consequence of Retrospective Cancellation of GST Registration: Delhi HC MUKESH KUMAR SINGH vs COMMISSIONER OF DELHI GST AND ORS CITATION: 2024 TAXSCAN (HC) 901 In a recent ruling, the Delhi High Court stated that denying input tax credit (ITC) to customers is a consequence of retrospectively cancelling GST registration. The petitioner challenged the dismissal of their appeal on grounds of limitation, as well as the retrospective cancellation of their GST registration and the show cause notice issued for it. The court emphasized that registration cannot be cancelled retrospectively without proper objective criteria being met, and mere non-filing of returns does not justify such action, especially if the taxpayer was compliant. The bench noted that cancelling registration retrospectively affects customers’ ability to claim ITC and should only be done if warranted by circumstances. Emery Cloth is Cotton Coated Fabric, eligible for Sales Tax Exemption: Andhra Pradesh HC The State of Andhra Pradesh vs M/s. Mohsin Brothers CITATION: 2024 TAXSCAN (HC) 902 The Andhra Pradesh High Court ruled that Emery Cloth, considered a cotton-coated fabric, qualifies for sales tax exemption. The Appellate Tribunal compared Tarpaulin to Rexine Cloth, which was previously exempt from tax, and exempted Tarpaulin under the same category. The Government Pleader argued that Emery Cloth, being sand-based and used for shining wood, shouldn’t be treated as cloth, while Tarpaulin falls under taxable item-174. However, the respondent’s counsel contended that both items are exempt under Entry-5 of the Fourth Schedule.

The court affirmed the Tribunal’s decision, stating that Tarpaulin’s inclusion in item-174 doesn’t affect its exemption, and Emery Cloth’s exemption under item-59.03 stands due to its liability under additional duties of excise. GST Dept not Empowered to Compute Penalty Amount on Higher Value than Invoice Value without Proper Evidence: Calcutta HC ASHISH KUMAR SHARMA vs THE DEPUTY COMMISSIONER CITATION: 2024 TAXSCAN (HC) 903 The Calcutta High Court ruled that the GST Department cannot impose a penalty exceeding the invoice value without proper evidence. The case involved a challenge to an order imposing a penalty for an expired e-way bill. While the appellant argued a breakdown caused the delay, they failed to provide supporting documents. The court noted the importance of considering intent to evade taxes in imposing penalties.

It found the penalty exceeded the invoice value without sufficient evidence and directed the appellant to pay Rs. 1,00,000, with the balance refunded within three months, without interest. Payment of Pre- Deposit can be made by Utilizing Electronic Credit Ledger: Gujarat HC M/S SHIV CRACKERS vs CHIEF COMMISSIONER OF CGST AND C.E. & ANR. CITATION: 2024 TAXSCAN (HC) 904 The Gujarat High Court reiterated that pre-deposit for filing GST appeals can be made using the Electronic Credit Ledger (ECL). In a case concerning a raised valuation of goods and tax evasion, the court noted a circular allowing ECL utilization for pre-deposit. Justices Bhargav D Karia and Niral R Mehta quashed the impugned order and restored the appeal, instructing the petitioner to utilize ECL for the disputed tax amount within two weeks. Exemption under Proviso of Section 12(5) of Arbitration and Conciliation Act applies only when Waiver Explicitly agreed upon in Writing by Parties: Kerala HC GROUPL SERVICES PRIVATE LIMITED vs DR. SUNIL VSUDEVAN CITATION: 2024 TAXSCAN (HC) 905 The Kerala High Court clarified that the exemption under Section 12(5) of the Arbitration and Conciliation Act, 1996, applies only when parties explicitly agree in writing to waive it. A petition sought to replace the sole arbitrator due to alleged bias

. The court rejected the argument that waiver applied, stating there was no express agreement in writing. It also dismissed claims of estoppel and acquiescence, noting that adherence to arbitration procedures does not imply waiver of rights. Non-Mentioning of Option for Personal Hearing in Notice: Delhi HC quashes Rejection of GST Registration Cancellation Application M/S SHOPPERS HOME vs PRINCIPAL COMMISSIONER OF GOODS AND SERVICE TAX NORTH DELHI CITATION: 2024 TAXSCAN (HC) 906 The Delhi High Court overturned the rejection of M/S Shoppers Home’s GST registration cancellation application due to procedural irregularities, emphasizing the importance of a fair opportunity for a personal hearing. The court found that the petitioner was not properly notified about the requirement for a personal hearing, depriving them of the chance to address discrepancies and provide clarifications. Despite uploading all necessary documents, the petitioner was unfairly dismissed solely for non-appearance at the hearing. The court stressed the need for transparent administrative procedures and adherence to natural justice principles. The matter was remitted back to the Proper Officer for re-adjudication, ensuring a fair opportunity for the petitioner to present their case in accordance with the law. Dispute on Insolvency and Winding-Up of Partnership Concerning Partners Rights and Obligations is Arbitrable: Telangana HC Shameem Sultana Khan vs Faizunnissa Begum CITATION: 2024 TAXSCAN (HC) 907 The Telangana High Court ruled that disputes regarding insolvency and winding-up of partnerships are arbitrable.

An application under Section 11(6) of the Arbitration and Conciliation Act, 1996 sought the appointment of a sole arbitrator to resolve a dispute between the parties as per Clause 19 of a Partnership Deed. Despite objections from some respondents, the court invoked Section 16(1) of the Act, empowering the arbitral tribunal to rule on its own jurisdiction. The court appointed Justice L. Nageswara Rao, a former Supreme Court Judge, as the sole arbitrator to adjudicate the dispute, emphasizing that the issue falls within the realm of arbitrability under the Indian Partnership Act, 1932. Pending Revenue Arrears:

Kerala HC directs to release Attached Residential Property on Submission of other Properties N. SATHEESH KUMAR vs THE ASSISTANT COMMISSIONER CITATION: 2024 TAXSCAN (HC) 908 The Kerala High Court directed the release of a residential property that was attached due to pending revenue arrears. The appellant, a registered dealer under the KVAT/KGST Act, faced arrears amounting to Rs 1,38,73,601/-. Revenue recovery proceedings were initiated against him, leading to the attachment of his residential property. However, the appellant offered three other properties as substitutes, valued at Rs 72,56,403/- for land and Rs 1,03,17,323/- for the building. The court ordered the release of the attached property upon acceptance of the offered properties as security for the due amount. Appellate Authority under GST Act is empowered to make Further Enquiry after deciding that Order is Erroneous: Kerala HC THE JOINT COMMISSIONER OF STATE TAX vs SASI PATHIRAKUNNATH CITATION: 2024 TAXSCAN (HC) 909 The Kerala High Court ruled that the Appellate Authority under the GST Act has the power to conduct further inquiry after deeming an order erroneous. The petition challenges an appellate order passed by the Joint Commissioner (appeals) under the CGST/SGST Act.

It pertains to the confiscation of gold transported without proper documents. The State Tax Officer confiscated the gold due to lack of valid documents. The petitioner seeks relief under Article 226, as the Tribunal to entertain appeals is not constituted yet. The respondent argues the discretionary nature of fines in lieu of confiscation. The court observed that the Appellate Authority has jurisdiction to conduct further inquiry and decide the issue afresh. Therefore, it upheld the authority’s power to interfere with the discretion exercised by the adjudicating authority. Delay in Producing Audited Balance Sheet due to Delay of Statutory Auditors: Kerala HC orders Re adjudication M/S. KERALA STATE CONSUMER FEDERATION LTD vs COMMISSIONER OF CENTRAL TAX & CENTRAL EXCISE CITATION: 2024 TAXSCAN (HC) 910 The Kerala High Court ordered re-adjudication due to a delay in producing audited balance sheets caused by the delay of statutory auditors. The petitioner, a government-controlled apex body of Consumer Co-operative Societies, received a show cause notice alleging non-payment of service tax. Despite contesting the notice, the demands were confirmed. The petitioner argued that it didn’t have an adequate opportunity to present its case, especially since audited accounts weren’t available during the adjudication.

The court noted the delay was primarily due to statutory auditors. Consequently, the order was set aside, and the adjudication of the show cause notice was restored to the respondent’s file. Execution of PoA as Petitioner is Bedridden: Kerala HC directs to Re-Export Seized Gold Ornaments SARASWATHY vs THE COMMISSIONER OF CUSTOMS CITATION: 2024 TAXSCAN (HC) 911 The Kerala High Court directed the re-export of seized gold ornaments, considering the petitioner’s bedridden condition and the execution of a special Power of Attorney. Customs Authorities had seized gold items from the petitioner, but in the adjudication order, they were released in her favor with permission for re-export. As the petitioner couldn’t appear due to being bedridden, she appointed someone through a special Power of Attorney for re-exporting the gold. The court directed the authorities to allow re-export based on the Power of Attorney, with the petitioner providing necessary details. Application for Rectification u/s 161 of CGST Act: Kerala HC directs to Pass Orders as time to file Appeal is Expiring LAHANTI LASTMILE SERVICES (P) LTD vs THE ADDITIONAL COMMISSIONER CITATION: 2024 TAXSCAN (HC) 912 The Kerala High Court directed the respondent to pass orders on the application for rectification under Section 161 of the CGST Act before the appeal filing deadline of March 29, 2024.

The petitioner sought rectification of mistakes in an order of adjudication dated December 30, 2023. The court ordered the respondent to consider the application and provide an opportunity for hearing to the petitioner. The petitioner was instructed to appear before the respondent on March 13, 2024, with a copy of the writ petition and the court’s judgment. Appeal against Refund Rejection order filed within Statutory Period under Limitation Act: Delhi HC directs to consider Appeal on Merits PRAMOD KUMAR TOMAR (PROP.M/S PARAMOUNT STEEL vs ASSISTANT COMMISSIONER MUNDKA DIVISION DELHI WEST, CENTRAL GOODS AND SERVICES TAX & ANR CITATION: 2024 TAXSCAN (HC) 913 The Delhi High Court ruled that an appeal against the rejection of a refund claim should be considered on its merits if filed within the statutory period of three months, as per Section 12(1) and (2) of the Limitation Act, 1963. The case involved Pramod Kumar Tomar, proprietor of M/S Paramount Steel, challenging the rejection of his refund claim under the CGST Act, 2017.

The rejection was based on alleged delay in filing the appeal due to a technical glitch. The petitioner demonstrated that the appeal was filed on time, meeting the requirements of Rule 108(3) of the CGST Rules, 2017. Despite initial disputes over the filing date, the court ruled that the appeal, filed within three months, should be considered. The division bench directed the Appellate Authority to assess the appeal on its merits, overturning the rejection based solely on the grounds of limitation.

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