This weekly round-up analytically summarizes the key stories related to the Supreme Court and High Court reported at Taxscan.in from May 11, 2024 to May 17, 2024. SUPREME COURT No Liability on Advocates for Deficiency of Services under Consumer Protection Act: Supreme Court BAR OF INDIAN LAWYERS vs D. K. GANDHI PS NATIONAL INSTITUTE OF COMMUNICABLE DISEASES AND ANR. CITATION: 2024 TAXSCAN (SC) 211 The Supreme Court made a significant ruling that advocates cannot be held liable under the Consumer Protection Act 1986 (as re-enacted in 2019) for deficiency of services. The Court held that professionals should be treated differently from individuals engaged in business and trade. The Court emphasized that lawyers appearing in court or before different forums may require distinct treatment from those sought for legal services such as opinions, consultations, and agreement drafting. Labelling or Re-labelling Cartons Constitute ‘Manufacture’ under Central Excise Act for Cenvat Credit and Rebate: Supreme Court COMMISSIONER OF CENTRAL EXCISE BELAPUR vs JINDAL DRUGS LTD CITATION: 2024 TAXSCAN (SC) 212 The Supreme Court has ruled that the labelling or re-labelling or putting additional labels to the containers amounted to ‘Manufacture’ for Cenvat Credit and rebate under Central Excise Act, 1944. The apex court, by this ruling, stopped the recovery of Rs. 36,24,84,120. The apex court noted that ‘manufacture’ includes any process incidental or ancillary to completing a manufactured product, any process specified in the Section or Chapter notes of the Central Excise Tariff Act as manufacturing, or any process involving packing, repacking, labelling, re-labelling, or altering the retail sale price to make the product marketable to consumers, as specified in the Third Schedule. No Arrest to be made by GST Officers on Suspicion: Supreme Court highlights Requirement of Verifiable Material to Substantiate The Supreme Court made several critical observations regarding the powers and procedures related to arrests by GST (Goods and Services Tax) officers recently.

The context of these observations arose during the hearing of petitions challenging penal provisions across various acts. A significant part of the discussion revolved around the absence of private complainants under the GST Act and the importance of having concrete and verifiable material before initiating arrests. The court stressed the significance of basing conclusions on evidence rather than mere suspicion before taking any coercive action. Supreme Court to Hear SLP against Gameskraft Challenging Karnataka HC decision on July 15, Alongside Transferred Cases DIRECTORATE GENERAL OF GOODS AND SERVICES TAX INTELLIGENCE vs GAMESKRAFT TECHNOLOGIES PRIVATE LIMITED CITATION: 2024 TAXSCAN (SC) 213 The Supreme Court has listed the Special Leave Petition ( SLP ) filed by the Directorate General of Goods and Services Tax Intelligence ( DGGI ) against the Gameskraft Technologies Private Ltd challenging the Karnataka High Court’s decision on July 15, 2024 alongwith the transferred cases. The bench quashed the GST Show-Cause Notice against the Gameskraft which had imposed Rs. 21,000 Crore at 28% GST on online gaming services provided to gamers. Relief to EMBIO Ltd: Supreme Court rules S. 11(2) of FT Act Does Not Authorise Penalty Imposition for Export Obligation Breach under Licence M/S. EMBIO LIMITED vs DIRECTOR GENERAL OF FOREIGN TRADE & ORS. CITATION: 2024 TAXSCAN (SC) 214 The Supreme Court, while granting relief to EMBIO Ltd ruled that penalty cannot be imposed under Section 11(2) of the Foreign Trade (Development and Regulation) Act, 1992 for not fulfilling the export obligation. The Section applies only when there is an allegation of making an export or import in contravention of the export and import policy. The supreme court identified a critical error in the judgments of both the Division Bench and the learned Single Judge regarding the withdrawal of the initial Writ Petition filed by Karnataka Biotics. Furthermore, the apex court scrutinised the circumstances surrounding the imposition of penalties. The appellant’s predecessor, Karnataka Biotics, was obligated to export goods to fulfil conditions outlined in the licence, failing which penalties were imposed. HIGH COURTS Madras HC quashes GST Assessment Orders issued without considering Interim Reply Submitted by Taxpayer M/s.Madhava Steels vs The Assistant Commissioner CITATION: 2024 TAXSCAN (HC) 979 The Madras High Court quashed the Goods and Services Tax ( GST ) assessment orders issued without considering the interim reply submitted by the petitioner/taxpayer.

The court directed the GST officers to take up the matter for reconsideration. The bench sets aside the orders for reconsideration, allowing the petitioner 15 days to submit a final reply. The respondent was directed to provide a reasonable opportunity, including a personal hearing, and issue fresh orders within four months of receiving the final reply. If the final reply isn’t filed within 15 days, the respondent granted the liberty to proceed based on the previously submitted interim reply. Madras HC sets aside GST DRC-07 Order issued without Considering Reply Submitted, Remands for Reconsideration M/s.Winndsor Cotton Mills (P) Ltd vs The Assistant Commissioner (ST) CITATION: 2024 TAXSCAN (HC) 980 The Madras High Court nullified a Goods and Services Tax ( GST ) DRC-07 order issued disregarding the assessee’s submitted reply. The challenge to an order dated 29.12.2023 arised from the petitioner’s contention that their responses to the Show Cause Notice ( SCN ) were disregarded. Following an audit, a SCN was issued on 27.09.2023, to which the petitioner replied on 26.10.2023. The court noted that the petitioner’s responses were not duly considered, rendering the impugned order unsustainable. Accordingly, the court set aside and remanded the matter for reconsideration. Non-Participation in GST Proceedings Confirmed Tax Liability with 100% Penalty: Madras HC orders 10% Pre-deposit to Contest Tvl. Ravisandran vs The Assistant Commissioner (ST) CITATION: 2024 TAXSCAN (HC) 981 The Madras High Court orders pre-deposit of 10% of the disputed demand to nullify the contested order. The court’s decision came in light of the assessee’s non-participation in the Goods and Services Tax ( GST ) proceedings, resulting in the confirmation of liability along with a hefty 100% penalty. The court noted that the GST proposal related to the purchase of a motor vehicle, accompanied by a 100% penalty was confirmed due to the non-participation in GST proceedings. Madras HC Mandates 10% Pre-deposit to Contest GSTR 1 vs GSTR 3B Discrepancy Tvl.

Vishal Agencies vs The Assistant Commissioner (ST) CITATION: 2024 TAXSCAN (HC) 983 The Madras High Court mandated a pre-deposit of 10% to contest the discrepancy of Goods and Services Tax Returns ( GSTR 1 ) and GSTR 3B. The petitioner’s contention arises from a notice in Form GST ASMT 10 issued on 24.05.2023, followed by a show cause notice dated 18.08.2023 and a subsequent reminder. The court set aside the impugned order dated 19.10.2023 and the matter was remanded for reconsideration, contingent upon the petitioner remitting 10% of the disputed tax demand within two weeks. GSTR 9, GSTR 9C, Income Tax Document Not Enough to Establish Goods Transport Services falls under RCM Category: Madras HC Baisany Ramiah Chetty Pandurangan vs Assistant Commissioner CITATION: 2024 TAXSCAN (HC) 984 The Madras High Court held that the documents such as GSTR 9, GSTR 9C, and Income Tax records alone are insufficient to establish that Goods Transport Services fall under the Reverse Charge Mechanism ( RCM ) category. The court noted the submission of GSTR 9, GSTR 9C, and income tax documents to substantiate that the Goods transport services fall within the scope of the Reverse Charge Mechanism (RCM). Unawareness of Proceedings w.r.t GST Returns Disparity due to Order Uploaded in Additional Notices and Orders tab: Madras HC orders 10% Pre-deposit Remand Tvl. Mayur Granites vs The Assistant Commissioner CITATION: 2024 TAXSCAN (HC) 985 The Madras High Court ordered a pre-deposit of 10% for contesting the Goods and Services Tax ( GST ) demand which confirmed failure to respond to the Goods and Services Tax ( GST ) proceedings as uploaded in the portal with respect to the GST returns disparity. The bench raised the bank account attachment as the order was set aside on pre-deposit condition. GST Officers Confirms Demand Claiming ITC wrongly availed on Commercial Vehicle Purchases: Madras HC orders Reconsideration M/s. Sri Uma Plastics vs .The Deputy State Tax Officer-2 CITATION: 2024 TAXSCAN (HC) 986 The Madras High Court set aside the Goods and Services Tax ( GST ) demand order which confirmed the demand claiming the Input Tax Credit ( ITC ) wrongly availed on the vehicle purchased for the commercial purposes.

The matter was remanded for reconsideration. Proper Officer failed to Explain Reason for Recovering Amount u/s 78 of TNGST Act before Limitation Period: Madras HC directs Refund Tvl.Cargotec India Private Limited vs The Assistant Commissioner (ST) CITATION: 2024 TAXSCAN (HC) 987 The Madras High Court directed the refund of the recovered amount as the proper officer failed to explain the reason for recovering the amount under Section 78 of Tamil Nadu Goods and Services Tax, 2017 ( TNGST ) before the limitation period of 3 months. The court observed that the proviso to Section 78 of the Tamil Nadu Goods and Service Tax Act, may be invoked only if the proper officer records in writing the reason as to why he considers it expedient in the interest of the revenue to require the taxable person to make payment even before the expiry of the prescribed three month period. In the case in hand, no material has been placed on record to justify invoking the proviso to Section 78 of the applicable GST enactments. Tax Liability Confirmed due to Wrong availment of ITC and and failure to reply SCN: Madras HC sets aside Order on 10% Pre-deposit M/s. Sebon Creations vs The Assistant Commissioner (ST) CITATION: 2024 TAXSCAN (HC) 988 The Madras High Court recently overturned a Goods and Services Tax ( GST ) order, requiring a pre-deposit of 10%. The order had confirmed the tax liability based on alleged wrongful availment of Input Tax Credit ( ITC ) and failure to respond to the Show Cause Notice ( SN ). The matter was remanded for reconsideration. CBDT’s Office Memo (Instr No.1914) does not Mandate 20% Remittance of Disputed Tax for Stay Application: Madras HC The Arni Agri Producers Coop Marketing Society Limited vs Principal Commissioner of Income Tax-8, Income Tax Office CITATION: 2024 TAXSCAN (HC) 989 The Madras High Court ruled that the Office Memorandum (Instruction No.1914) of the Central Board of Direct Taxes ( CBDT ) does not mandate 20% remittance of the disputed tax for stay application. The bench noted that the appellate authority did not examine whether the petitioner had made out a prima facie case. The court noted that the grant of stay involves discretionary jurisdiction, and it does not sit in appeal over such discretion.

Taxpayers Must Regularly Monitor GST Portal; Unawareness as Justification Not Convincing: Madras HC Tvl. Gayatri Granites Represented by its Partner VS The Assistant Commissioner CITATION: 2024 TAXSCAN (HC) 990 The Madras High Court, while remanding the matter on 10% Pre-deposit condition, observed that the taxpayers must regularly monitor the Goods and Services Tax ( GST ) portal. The bench emphasised that as a registered entity under the relevant GST regulations, the petitioner bears the responsibility of regularly monitoring the GST portal. GST Demand Confirmed Without GSTR 9C Consideration: Madras HC Orders Pre-deposit of Rs. 2.50 Crore Renaatus Projects Private Limited vs State Tax Officer CITATION: 2024 TAXSCAN (HC) 991 The Madras High Court ordered a pre-deposit of Rs. 2.50 crores for setting aside the Goods and Services Tax ( GST ) demand which was confirmed without the consideration of GSTR 9C. The bench noted that the respondent calculated tax based on the combined turnover from both the profit and loss account and the GSTR 9 return, resulting in a sum of Rs. 330 crore. Contempt Petition: Bombay HC directs to pay Balance Amount of Rs.4,52,600/-compensation  to Petitioner within Two Weeks Sanjay Sadashiv Nikam vs Custom Capsules Pvt. Ltd CITATION: 2024 TAXSCAN (HC) 992 The Bombay High Court directed to pay a balance amount of Rs,4,52,600/-compensation to the petitioner within two weeks while considering the contempt petition filed against the non compliance of order passed by the court. The bench observed that the respondent shall release the entire amount of Rs.25,00,000/- to the Petitioner and it will be for the Petitioner to satisfy the income tax authorities in respect of his tax liability towards receipt of amount of Rs.25,00,000/- towards staggered wages during the period from 7 March 2017 till 24 January 2024. Himachal Pradesh HC disposes Revision Petition by directing re adjudication with respect to Order of ITAT Youth Hostels Association of India vs State of Himachal Pradesh and others CITATION: 2024 TAXSCAN (HC) 993 The Himachal Pradesh High Court disposed of a revision petition by directing re adjudication with respect to the order of Income Tax Appellate Tribunal ( ITAT ). The revision  petition filed by the Youth Hostels Association of India. During the adjudication it was observed that no fault can be found with the orders passed by the Authorities below including the Tax Tribunal as impugned in this revision petition. Ship Fuel Oil, Foodstuff not considered Inputs Ship Breaking Scrap Manufacture directly or indirectly:

Gujarat HC upholds CESTAT Order COMMISSIONER OF CENTRAL EXCISE vs SHRI GAUTAM SHIP BREAKING IND CITATION: 2024 TAXSCAN (HC) 994 The Gujarat High Court while upheld  the Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ) order held that Ship Fuel oil, Food Stuff are not considered inputs of ship breaking  scrap manufacture directly or indirectly. The appeal was filed by the petitioner Gautam Ship Breaking Ind. Ltd. against the  order passed by the Customs, Excise and Service Tax Appellate Tribunal. The bench relied upon the decision of Commissioner of Central Excise vs. Gupta Steel observed that fuel oil and foodstuff on board ship are not inputs required directly or indirectly or in relation to manufacture of scrap emerging from the breaking of the ship, and therefore, not eligible for modvat credit. Non Filling of Part-B of E-Way Bill, without any proof of Intention to Evade Tax, would not Lead to Imposition of Penalty: Allahabad HC allows Appeal M/S Rs Industrial Solutions vs Additional Commissioner Grade 2 And Another CITATION: 2024 TAXSCAN (HC) 995 The Allahabad  High Court, while allowing the appeal held that non filing of Part-B of the e-way bill, without any proof of intention to evade tax, would not lead to the imposition of penalty. The petitioner Rs Industrial Solutions filed the writ petition against the order of Income Tax Department. Non-Deposit of Income Tax Refund of Rs. 14.77 Lakhs as per Court Order: Himachal Pradesh HC directs Dept Official to be Present in Court on failure to Deposit within Three Weeks Tek Ram vs Union of India & Anr. CITATION: 2024 TAXSCAN (HC) 996 The Himachal Pradesh High Court while observing the non deposit of income tax refund of Rs.1.77 Lakh as per the court order, the bench directs the department official to be present in the court on failure to deposit within three weeks.

The writ petition was filed by the petitioner Tek Ram on account of non-deposit of income tax refund of Rs.14.77 Lakhs as per the court order. The bench directs the department official to be present in the court on failure to deposit within three weeks if they failed to deposit the amount. Unconstitutional for Unequal Treatment of Equals: Karnataka HC strikes down EPF Scheme Extension to International Workers STONE HILL EDUCATION FOUNDATION vs THE UNION OF INDIA CITATION: 2024 TAXSCAN (HC) 997 The Karnataka High Court has invalidated the Central Government decision to extend the Employees Provident Fund Scheme and Employees Pension Scheme to international workers in India. The court noted a discriminatory practice between Indian employees in non-SSA countries (not classified as international workers) and foreign employees from non-SSA countries working in India (classified as international workers). Madras HC dismisses WP against Revision Order, Stresses Distinction from Scrutiny Assessment Order u/s 143(3) of IT Act; Directs Pursuit of Statutory Appeal Suresh Patel vs Principal Commissioner of Income Tax CITATION: 2024 TAXSCAN (HC) 998 The Madras High Court has upheld an order under Section 263 of the Income Tax Act, dismissing a writ petition filed against it. The court emphasised the clear distinction between the scrutinised assessment order under Section 143(3) and the impugned decision, directing the petitioner to pursue statutory appeal before the Appellate Tribunal under Section 253(1)(c) of the Income Tax Act, 1961, within a period of 45 days from the date of receipt of a copy of the order. The court disposed of the writ petition highlighting the importance of procedural compliance and the availability of legal recourse for taxpayers dissatisfied with income tax assessments. GST Liability of 8.3L Confirmed on alleged Misconception of Intra and Inter State Sales:

Madras HC remands for Reconsideration on Pre-deposit M/s. Orient Electricals and Engineers India (P) Ltd vs Assistant Commissioner (ST) CITATION: 2024 TAXSCAN (HC) 999 The Madras High Court directed reconsideration of the matter with respect to the Goods and Services Tax (GST) liability of Rs. 8.3L confirmed on misconception of Intra and Inter state sales on Rs. 3 lakhs pre-deposit condition. The court directed the respondent to afford the petitioner a reasonable opportunity, including a personal hearing, and to issue a fresh order within three months from the date of receipt of the remittance. GST Consultant fails to inform GST Proceedings w.r.t. GSTR 3B vs 2A Disparity: Madras HC mandates 10% Pre-deposit for Remand Rishab Industries vs The Assistant Commissioner (ST) CITATION: 2024 TAXSCAN (HC) 1000 The Madras High Court mandated a 10% pre-deposit for the reconsideration of a case where the petitioner was unaware of Goods and Services Tax ( GST ) proceedings due to the failure of their GST consultant to inform them about the disparity between GSTR 3B and GSTR 2A. The court observed that the tax liability arises from the mismatch between the petitioner’s GSTR 3B returns and the auto-populated GSTR 2A. Adjournment Request Disregarded, No Reasonable Hearing Opportunity Provided: Madras HC sets aside GST Demand Order Tvl. Sri Nallamal Steels vs The Assistant Commissioner (ST) (FAC) CITATION: 2024 TAXSCAN (HC) 1001 The Madras High Court quashed the Goods and Services Tax ( GST ) demand order as the adjournment request of the petitioner was disregarded and no reasonable opportunity was provided. Thus, the court was deemed to interfere with the order. The single bench set aside the impugned order and the matter was remanded for reconsideration. The petitioner is granted two weeks to submit replies to the respective show cause notices.

Madras HC Orders 10% Pre-deposit for Reconsideration of GST Demand Arising from Wrongful ITC Claim Amid Non-Response to SCN & Personal Hearing M/s.Navbharat Boilers vs Assistant Commissioner CITATION: 2024 TAXSCAN (HC) 1003 The Madras High Court mandated 10% pre-deposit of disputed tax for the reconsideration of the Goods and Services Tax ( GST ) demand arising from the wrongful availment of Input tax Credit ( ITC ) amid non-response to the Show Cause Notice ( SCN ) and Personal hearing. The bench set aside the impugned order on a 10% pre-deposit of the disputed tax demand within two weeks and submitting a reply to the show cause notice within the same period. Madras HC Remands Income Tax Reassessment & Penalty Orders Citing Lack of Participation;

Directs Petitioner to Respond to SCN Vijayakumar vs Assessment Unit CITATION: 2024 TAXSCAN (HC) 1004 The Madras High Court has rendered a verdict remanding income tax reassessment and penalty orders, highlighting a critical deficiency in the participation of the petitioner. The case revolves around two writ petitions filed by Vijayakumar, an income tax assessee, challenging the validity of an assessment order and a penalty order. The bench set aside the impugned orders and remanded the matter for reconsideration. The petitioner was directed to submit a reply to the SCN within 15 days of receiving the court’s order. Kerala HC halts Recovery Proceedings amidst pending appeals; Directs Commissioner of Income Tax to expedite resolution of Stay Petitions and Appeals MUHAMMED ALI P.P vs ASSISTANT COMMISSIONER OF INCOME TAX CITATION: 2024 TAXSCAN (HC) 1005 The Kerala High Court has intervened to temporarily halt the income tax recovery proceedings against the petitioner. This decision came amidst pending appeals filed by Mr. Muhammed Ali P.P., a resident of Malappuram, Kerala challenging the assessment orders issued by the Income Tax Department for the assessment years 2011-2012, 2012-2013, and 2013-2014.

The bench suspended the recovery proceedings against the petitioner and directed the Commissioner of Income Tax to expedite the resolution of the pending appeals and stay petitions stressing procedural integrity and timely redressal of grievances. Adjudication for Assessing Stamp Duty required to be made by Determining True Market Value of Property: Bombay HC Shri Kshitij Pravin Desai vs Chief Controlling Revenue Authority CITATION: 2024 TAXSCAN (HC) 1006 The Bombay High Court held that the adjudication for assessing stamp duty is required to be made by determining the true market value of the property. This petition challenged an order passed by the Chief Controlling Revenue Authority rejecting the appeal preferred under Section 53(1A) of the Maharashtra Stamp Act, 1958 (“The Stamp Act”). The bench held that “Sub-section (2) of Section 31 permits calling for an affidavit or evidence as deemed necessary by the Collector to examine the facts and circumstances affecting the chargeability of the instrument with duty or the amount of the duty with which it is chargeable. Punjab and Haryana High Court quashes ECIR  filed by Enforcement Directorate u/s 3 r/w Sec. 4 of PMLA Act Chetan Gupta vs Directorate of Enforcement CITATION: 2024 TAXSCAN (HC) 1007 The Punjab and Haryana High Court quashed the First Information Report ( FIR ) filed by the enforcement directorate under Section 3 read with Section 4 of the Prevention of Money Laundering Act, 2002. The bench observed that “The petitioners have been acquitted in the primary predicate offense in the present case. Consequently, secondary evidence, i.eThe offense being prosecuted by the Enforcement Directorate, would also go automatically.

Thus, the complaint filed by the Enforcement Directorate has to be closed along with consequential proceedings. Once the complaint is closed, the Enforcement Directorate can keep such records in their ECIR record because if, later on, such closure, charge, or acquittal is reversed, the objection can be reopened”. Jurisdictional Powers of GST Joint Commissioner (Investigation) Enforcement Wing under Challenge: Rajasthan HC stays Coercive Actions against Petitioner Agrawal Namkeen vs Goods And Service Tax Council CITATION: 2024 TAXSCAN (HC) 1008 A Division Bench of the Rajasthan High Court has stayed coercive steps against petitioner as the jurisdictional powers of the Goods and Services Tax ( GST ) Joint Commissioner, (Investigation) Enforcement Wing came under challenge. The dispute centered on the authority of a specific GST official to adjudicate cases. The court acknowledged the need for further examination of the jurisdictional issue raised by the petitioner. The court has temporarily restrained the authorities from taking any coercive actions against the petitioner based on the disputed order. Kerala HC Orders Stay on Recovery of Demand; Urges Prompt Resolution of Appeal and Stay Petition Within Two Months BENNY JOHN vs THE COMMISSIONER OF INCOME TAX (APPEALS) CITATION: 2024 TAXSCAN (HC) 1009

The Kerala High Court has intervened in a case involving the recovery of demand by the Income Tax Department, emphasising the importance of a fair and expedited appeals process. The case revolves around the petitioner, Benny John, hailing from Kottayam against whom the Income Tax Department had initiated proceedings concerning the assessment year 2015-2016 leading to the issuance of an assessment order. The court stressed the importance of ensuring a fair and efficient appeal process, providing relief to taxpayers who find themselves caught in the complex web of tax assessments and legal proceedings. Reasons are Heart and Soul of Order passed by Authority: Andhra Pradesh HC quashes Bar License Suspension Order by Excise Commissioner M/s Teja Bar and Restaurant vs The State of Andhra Pradesh CITATION: 2024 TAXSCAN (HC) 1010 The Andhra Pradesh High Court quashed the Bar license suspension order by the Excise Commissioner and held that the reasons are the heart and soul of order passed by the Authority. The grievance of the petitioner is that show-cause notice was issued to the petitioner pursuant to registration of case of Special Enforcement Bureau Station, Kadapa under Section 36(1) (b&c), 41 of Andhra Pradesh Excise Act, 1968 read with Rules 31, 41 and 48 of Andhra Pradesh Excise (Lease of Right of Selling by Bar, Grant and conditions of License) Rules, 2022. The bench observed that “In fact, reasons are the heart and soul of the order passed by the authority. Non-recording of reasons could lead to dual infirmities; firstly, it may cause prejudice to the affected party and secondly, more particularly, hamper the proper administration of justice. Advance Tax unutilised under VAT allows to be Transitioned u/s 140 of TNGST Act: Madras HC Radhikka Ceramic World vs The State Tax Officer CITATION: 2024 TAXSCAN (HC) 1011 The Madras High Court has ruled that the Advance tax unutilised under the Value Added Tax ( VAT ) or Tamil Nadu VAT ( TNVAT ) has been allowed to be transitioned under Section 140 of the Tamil Nadu Goods and Services Tax Act, 2017 ( TNGST ). The bench noted the decision of the Madras High Court in Avatar Petro Chemicals Private Limited Vs. Goods and Service Tax Council, where it was observed that ITC and/or capital goods credit that was legitimately claimed under the previous tax laws, which have now been merged into the GST regime, cannot be refused. Such credits must be permitted to be carried forward and utilized against tax liabilities under GST if they were legitimately claimed but remained unutilized in either the

CENVAT account or VAT returns before GST implementation. Counterparts Barred from Initiating Proceedings Against CGST or SGST Allocated assessees in absence of Cross Empowerment Notification: Madras HC M/s.Ram Agencies vs The Assistant Commissioner of Central Tax CITATION: 2024 TAXSCAN (HC) 1012 The Madras High Court, upholding the ruling in the  Tvl.Vardhan Infrastructure’s case, ruled that the in the absence of the Cross Empowerment notification, the counterparts department is barred from initiation proceedings against assessee allocated to Central Goods and Services Tax ( CGST ) or State Goods and Services Tax ( SGST ). The court noted that the issue of cross-empowerment and jurisdiction concerning the initiation of proceedings when an assessee is allocated to either Central or State Tax Authorities was thoroughly examined by this Court in Tvl.Vardhan Infrastructure’s case. The conclusion drawn was that without a notification for cross-empowerment, counterparts cannot initiate proceedings against an assessee allocated to the other department. Inconsistent Expressions in Affidavit Not Sufficient Ground for Insufficiency Claim Against ED Materials: Jharkhand HC dismisses Hemant Sore’s Petition Hemant Soren vs Directorate of Enforcement CITATION: 2024 TAXSCAN (HC) 1013 The Jharkhand High Court dismissed the writ petition filed by Jharkhand Chief Minister, Hemant Soren and held that mere use of inconsistent expressions in affidavit not ground to hold that materials in possession of the Enforcement Directorate (ED) were insufficient. The court held that there is no goof-ups in the ED’s case and the statements made in the affidavit-in-opposition have to be read with reference to the documents appended therewith and the mere use of some inconsistent or contradictory expressions in the affidavit cannot be a ground to hold that the materials in possession of the ED were insufficient or that the arresting officer himself was confused. Inadequate Response to Notices Rendering Insufficient Evidence for Order; Madras High Court Remitted Matter Seeking Proper Reply to SCN Tamil Nadu Viswakarma Mutual Benefit Nidhi Limited vs The Assistant Commissioner of Income Tax CITATION: 2024 TAXSCAN (HC) 1014 The Madurai Bench of the Madras High Court has remitted a matter back to the Assistant Commissioner of Income Tax citing inadequate response to the Notices rendering lack of Evidence for order.

The judgment highlighted the critical importance of procedural compliance and adequate response to official notices issued under the Income Tax Act, 1961. Proceedings against deceased Unsustainable: Madras HC Sets Aside Order Citing Timely Intimation of Death to Income Tax Officer V.Purushothaman vs Income Tax Officer CITATION: 2024 TAXSCAN (HC) 1015 The Madras High Court has set aside an assessment order and consequential penalty proceedings initiated under the Income Tax Act, 1961 by the Income Tax Department against a deceased individual citing the timely intimation of the death of the assessee to the Income Tax Officer. The bench quashed the assessment order and penalty proceedings against Mr. Veeraraghavan, leaving it open for the Income Tax Department to initiate proceedings against his legal heirs in accordance with the law. Unreasoned Order cannot be Sustained in Law: Calcutta HC quashes Order of State Tax Commissioner Cancelling GST Registration State Of U.P. Thru vs State Of U.P. Thru. Addl CITATION: 2024 TAXSCAN (HC) 1016 The Calcutta High Court quashed the order of the State Tax Commissioner cancelling GST registration of proprietorship concern and held that unreasonable order cannot be sustained in law. The bench observed that “Such an unreasoned order cannot be sustained in law as no judicial order can be passed without giving sufficient reasons for passing of the order.

The appeal filed against the aforesaid order has been dismissed on the ground of limitation only. Bar of limitation may bar the remedy of appeal but it does not bar the petitioner’s right to seek his constitutional remedy under Article 226 of the Constitution of India, particularly when the impugned order affects valuable rights of the petitioner and the same has been passed without assigning any reason.” Delhi HC Invalidates Assessment Order Citing Non Consideration of Reply & Evidence; Orders Re-Adjudication with Opportunity for Filing Additional Reply & Personal Hearing SPS ENTERPRISES vs COMMISSIONER OF DELHI GOODS AND SERVICE TAX & ANR. CITATION: 2024 TAXSCAN (HC) 1017 The Delhi High Court has invalidated an assessment order issued by the Commissioner of Delhi Goods and Service Tax ( GST ), emphasising the failure to duly consider the detailed response and evidence submitted by the petitioner. The court has ordered re-adjudication of the matter, providing an opportunity for the petitioner to file an additional reply and attend a personal hearing. The court directed the Proper Officer to re-adjudicate the SCN, emphasising the importance of affording the petitioner a fair opportunity to present their case. The court ordered the withdrawal of all punitive actions taken against the petitioner, including the blocking of credit ledger and provisional attachment of property, if any, pursuant to the impugned order. Adequate Opportunity of Hearing Granted: Gujarat HC directs to Avail Remedy u/s 107 of GST Act M/S BLACK STONE CORPORATION PRIVATE LIMITED vs STATE OF GUJARAT CITATION: 2024 TAXSCAN (HC) 1018 The Gujarat High Court directed to avail remedy under Section 107 of the GST Act as adequate opportunity of hearing was granted. The bench observed that “On perusal of the impugned order in original passed in Form GST DRC-07, it emerges that the petitioner has been given adequate opportunity of hearing as stated in Para.5.1 to 5.9 of the impugned order and, therefore, the contention of the petitioner that the opportunity of hearing not given is not tenable and the petitioner is, therefore, required to be relegated to avail the alternative efficacious remedy under Section 107 of the GST Act, to challenge the impugned order before the appellate authority.”

Delhi HC quashes Rs 2.4 Crore Tax Demand Citing Insufficient Reason for Rejection of Response to SCN: Orders Re-Adjudication and Opportunity for Further Reply MUDITA EXPRESS CARGO PRIVATE LIMITED vs COMMISSIONER, STATE GOODS AND SERVICES TAX DELHI CITATION: 2024 TAXSCAN (HC) 1019 The Delhi High Court has quashed a tax demand amounting to Rs.2.4 crore against Mudita Express Cargo Private Limited citing insufficient reason for rejection of the response to the Show Cause Notice (SCN). The ruling came in response to a petition filed by the company challenging an order issued by the tax authorities. The court ruled that the respondent authority must reconsider the matter, giving due consideration to the petitioner’s submissions and granted Mudita Express Cargo Pvt. Ltd. an opportunity to file a further reply to the SCN within 30 days. Madhya Pradesh HC dismisses petition  against Supplementary Prosecution complaint filed by ED against director of Zoom developers SMT. MANJRI CHOUDHARI vs UNION OF INDIA CITATION: 2024 TAXSCAN (HC) 1020 The Madhya  Pradesh High Court dismissed a petition against a supplementary prosecution complaint filed by the Enforcement Directors ( ED ) against the director of Zoom Developers.

The present appeal was filed against the Supplementary Prosecution Complaint filed by the ED  against the petitioner related to the Prevention of Money Laundering Act, 2002. The bench dismissed the petition against the  supplementary prosecution complaint filed by the Enforcement Directors against the director of Zoom Developers. Karnataka HC quashes FIR registered under Prevention of Corruption Act without verifying ITR SRI. CHANNAKESHAVA.H.D. vs STATE OF KARNATAKA BY LOKAYUKTA PS CITATION: 2024 TAXSCAN (HC) 1021 The Karnataka High Court quashed an FIR registered under Prevention of Corruption Act, 2002 without verifying the Income Tax Return ( ITR ). The court observed that there is no preliminary enquiry conducted by the police before registering the FIR. The source report is also insufficient since the beginning period of the property in possession of the petitioner was shown as ‘Nil’ or ‘Zero’. Therefore, the source report is also insufficient and the order passed by the Superintendent of Police is also non application of mind. Therefore, the bench quashed an FIR registered under Prevention of Corruption Act, 2002 without verifying the Income Tax Return (ITR).

Tax Evasion under Government License without maintaining proper registers, documents: Karnataka HC upholds FIR registered under Karnataka Police Act SURYA AND CO SITUATED AT BANGALORE TURF CLUB LIMITED vs STATE OF KARNATAKA CITATION: 2024 TAXSCAN (HC) 1022 The Karnataka High Court  while observing tax evasion carried under government license without proper registers and documents  upheld the First Information Report ( FIR ) registered under Karnataka Police Act , 1968 . Petitioner, Surya And Co  who have been issued license from the State Government were accepting betting on the horse races, without maintaining proper registers, documents etc.with regard to the amount collected by them from the punters and thereby they were evading tax payable to the State and certain others. The court upheld the FIR registered under Karnataka Police Act  and observed that the allegations against the accused is of very serious nature and the accused, amongst other allegations, allegedly have misappropriated crores of money collected by them towards payment of Goods and Service Tax (GST) and Tax Deduction at Source (TDS). Delhi HC Sets Aside CESTAT Order Citing Lack of Jurisdiction to Entertain Appeal; Directs to File Revision with Central Government under Customs Act COMMISSIONER OF CUSTOMS ACC EXPORT vs ARIHANT OVERSEAS CITATION: 2024 TAXSCAN (HC) 1023 The Delhi High Court has nullified an order issued by the Customs Excise and Service Tax Appellate Tribunal ( CESTAT ), citing jurisdictional constraints.

The case in question involves a dispute between the Commissioner of Customs ACC Export and M/S Arihant Overseas. The issue revolves around an appeal filed by M/S Arihant Overseas challenging a demand of drawback and an order of confiscation of goods previously exported under drawback. The Court directed M/S Arihant Overseas to file the Revision with the Central Government within a period of two months from the date of the judgment. Further, the Court ensured that if the Revision is filed within the specified timeframe, it shall be adjudicated on its merits without being dismissed solely on grounds of limitation. PILs cannot Serve Private Causes: Delhi High Court dismisses PIL on PMLA Section 66 Interpretation, Directs Parties to Pursue Proper Legal Channels ASHOK KUMAR SINGH AND ORS vs UNION OF INDIA AND ANR CITATION: 2024 TAXSCAN (HC) 1024 The Delhi High Court has held that Public Interest Litigations ( PILs ) cannot be used for private causes, confirming the limitations of PILs and affirming the need for parties to pursue proper legal avenues in matters concerning statutory interpretations.

The bench emphasised that it is the parties in criminal cases who should challenge proceedings, not third parties under the guise of public interest litigants and noted that the PIL did not challenge the constitutionality or validity of any statutory provision. Instead, it primarily sought an authoritative interpretation of Section 66 of the PMLA Act. Alleged Erroneous 100% Penalty Imposed under CGST Act for Period Falling under VAT Regime: Madras HC directs Statutory Appeal Shri. J.Milton Jeba Manickam vs The Assistant Commissioner of Central GST CITATION: 2024 TAXSCAN (HC) 1025 The Madras High Court directed the petitioner to file a statutory appeal under Section 107 of the CGST Act in the case where it was alleged 100% penalty was imposed wrongly under the Central Goods and Services Tax ( CGST ), 2017 for the period falling under Value Added Tax ( VAT ) regime. concluded that challenging the assessment order does not warrant interference under Article 226 of the Constitution of India. Instead, the petitioner is directed to pursue a statutory appeal under Section 107 of the GST Act before the appellate authority. Inducement to Pay Wrongful Gratification for Illegal Appointments: Calcutta HC rejects Bail Application of Kuntal Ghosh CBI/ACB/Kolkata VS Kuntal Ghosh CITATION: 2024 TAXSCAN (HC) 1026 The Calcutta High Court rejected the bail application of Kuntal Ghosh in the matter regarding the inducement to pay wrongful gratification for illegal appointments.

The bench observed that in the present case, further detention is necessary to insulate the process of further investigation with regard to the nexus of the petitioner with the office bearers of the Board. It is also necessary to trace out the proceeds of crime which were rooted through the petitioner to other influential persons. Though it is argued petitioner has been stripped off his official role in the political party, he continues to have overwhelming influence and his release on bail shall overawe various candidates and other individuals who are vital witnesses to prove the involvement of the petitioner in procuring illegal appointments. It is also relevant to note petitioner has been implicated in offences under PMLA and a complaint has been filed against him. Appellate Authority Empowered to Condone Delay beyond One Month from Prescribed Period of Limitation u/s 107 (4) of WBGST Act: Calcutta HC Mukul Islam vs Assistant Commissioner of Revenue CITATION: 2024 TAXSCAN (HC) 1027 The Calcutta High Court recently held that the appellate authority was empowered to condone delay beyond one month from the prescribed period of limitation under Section 107 (4) of the West Bengal Goods and Services Tax Act, 2017 ( WBGST Act ). The writ petition has been filed, inter alia, challenging the refusal on the part of the appellate authority to condone the delay in maintaining the appeal under Section 107 of the West Bengal Goods and Services Tax Act, 2017.

The court observed that in absence of a non obstante clause rendering Section 29 (2) of the Limitation Act 1963, non applicable and in absence of specific exclusion of Section 5 of the Limitation Act, 1963, it would be improper to read implied exclusion thereof. GST Notice uploaded in “View Additional Notices and Orders” tab Portal, Unaware of Proceedings: Madras HC remands for Reconsideration on Pre-deposit Narie Constructions Private Limited, vs The State Tax Officer, CITATION: 2024 TAXSCAN (HC) 1028 The Madras High Court directed the petitioner 10% pre-deposit for remanding the matter for reconsideration. The petitioner was unaware about the Goods and Services Tax ( GST ) proceedings as the notice was uploaded in the  “View Additional Notices and Orders” tab in the GST Portal. The petitioner was allowed to respond to the show cause notice within the same period. Upon receipt of the reply and confirmation of the remittance, the respondent is directed to provide a reasonable opportunity for a personal hearing and issue a fresh order within two months. GST Registration Cancellation Order under Challenge: Madras HC orders GSTR Filing Prior to Cancellation, Mandates Tax Dues and Interest Payment Jones Diraviam vs The Commercial Tax Officer CITATION: 2024 TAXSCAN (HC) 1029 The Madras High Court, given the similar issues in the Suguna Cutpiece Center case, pronounced the same judgment, ordering the petitioner to file the Goods and Services Tax Returns ( GSTR ) prior to the GST registration cancellation with payment of tax dues, interest and belated fee. The bench granted the writ petition following the guidelines from Suguna Cutpiece’s case.

No costs are imposed, and the connected miscellaneous petition is closed. Challenge on CBIC Notification: Delhi HC quashes Instruction Denying Benefit to Solar Power Generation Units ACME HEERGARH vs CENTRAL BOARD OF INDIRECT TAXES CITATION: 2024 TAXSCAN (HC) 1030 While considering a batch of writ petition filed challenging the validity of Instruction under instructions dated July 9, 2022, issued by the Central Board of Indirect Taxes and Customs ( CBIC ) in the exercise of powers conferred by Section 151A of the Customs Act, 1962, the Delhi High Court has held that the statutory scheme underlying the Manufacture and Other Operations in Warehouse Regulations, 2019 ( MOOWR ) cannot be construed as seeking to exclude solar power generation in terms of permissions granted under Section 65 of the Customs Act, 1962. Case Transfer to another AO not Permissible without Decentralization order u/s 127 of Income Tax Act on Centralization of Case: Delhi HC RAJ SHEELA GROWTH FUND VS PR COMMISSIONER OF INCOME TAX CITATION: 2024 TAXSCAN (HC) 1031 The Delhi High Court observed that case transfer to another Assessing Officer (AO) is not permissible without a decentralization order under Section 127 of the Income Tax Act, 1961 on centralization of the case. The bench observed that “It is discernible that once the case of the assessee is centralized, then the transfer of the case of the assessee to another AO would not be permissible without a decentralization order or transfer order under Section 127 of the Act as contrary to such a position dehors the underlying objective which the Act seeks to achieve by virtue of powers enshrined under Section 127 of the Income Tax Act. We accordingly set aside the impugned orders dated 31.12.2017 and 30.09.2021.

” Allahabad HC denies Bail to MLA Abbas Ansari in Money Laundering Case Abbas Ansari vs Directorate Of Enforcement CITATION: 2024 TAXSCAN (HC) 1032 The Allahabad High Court denied bail to MLA from Mau Assembly Seat in State of Uttar Pradesh, Abbas Ansari in a money laundering case. The applicant was arrested by the investigating agency in connection with the instant ECIR. The court observed that “Considering the family antecedents of the applicant including the statement which is contained in the ECIR that the applicant initially was not co-operative rather evaded the summons and only when the lookout notice was issued and in furtherance thereof the applicant was apprehended and during custody he gave his statements but nevertheless many of the transactions could not be explained by him by taking a plea that he did not know from where the fund was coming rather whenever he wanted the funds he asked his mother and maternal uncle and grandfather who would arrange the funds.” Right of DRI to issue SCN: Delhi HC restores Appeals before CESTAT COMMISSIONER OF CUSTOMS vs SHRI RAM PARKASH SINGHAL CITATION: 2024 TAXSCAN (HC) 1033 The Delhi High Court restored appeals before the Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ) in the matter regarding the right of the Directorate of Revenue Intelligence ( DRI ) to issue the show cause notice ( SCN ). The Coordinate Bench of the court has disposed of several appeals, finding that the orders passed by CESTAT to the aforesaid effect were not justified and further directing the CESTAT to decide the appeals on merit, including the question of jurisdiction, uninfluenced by the decision of this case of Mangali Impex Ltd, as the operation in the said order has been stayed by the Supreme Court.

Order Freezing Bank Accounts not to Remain in Force Sixty Days from Date of Order under Sub-Section (8-A) to Section 132 of Income Tax Act: Delhi HC M/S POOJA TRADING CO vs DEPUTY DIRECTOR OF INCOME TAX (INV) & ANR CITATION: 2024 TAXSCAN (HC) 1034 The Delhi High Court observed that the order freezing bank accounts not to remain in force for more than sixty days from date of order under sub-section (8-A) to Section 132 of the Income Tax Act, 1961. The petitioners sought directions to de-freeze the bank accounts and to set aside the letter issued by the respondents. The court observed that “Undisputedly, a plain reading of sub-section (8-A) to Section 132 of the Act would unambiguously signify that in the instant case, the order of freezing the bank accounts could not remain in force for a period exceeding sixty days from the date of the order. Admittedly, the said period of sixty days had already expired before the filing of the present petitions and no subsequent order appears to have been passed for extending the freezing of accounts.” Recording of Satisfaction by AO before Initiating Section 153C proceedings: Delhi HC dismisses Writ Petition SUNITA GOEL vs DEPUTY COMMISSIONER OF INCOME TAX CENTRAL CITATION:   2024 TAXSCAN (HC) 1035 The Delhi High Court dismissed the writ petition as there was the recording of satisfaction by the Assessing Officer (AO) before initiating Section 153C of the Income Tax Act, 1961 proceedings.

The court observed that “It is crystal clear that the present is not the case where the principles of natural justice have not been met or the AO has not duly applied his mind before passing the impugned order. Therefore, there is no occasion for this Court to exercise the extraordinary powers enshrined under Article 226 of the Constitution as none of the exigencies noted above have been met in the instant case.” GST Registration Cancelled due to Non-Response to SCN: Delhi HC directs Cancellation w.e.f. SCN Issuance Date KOMAL ENTERPRISES vs KOMAL ENTERPRISES CITATION: 2024 TAXSCAN (HC) 1036 The Delhi High Court directed the Goods and Service Tax ( GST ) registration cancellation effective from the date of issuance of Show Cause Notice ( SCN ) due to failure to submit a reply. The registration was cancelled due to the failure to submit a reply to SCN. The bench noticed that the Show Cause Notice and the impugned order are also bereft of any details. Neither the Show Cause Notice, nor the order spell out the reasons for retrospective cancellation. Accordingly, the same cannot be sustained. Powers u/s 127 of Income Tax can be invoked for Public Interest, Administrative Convenience and Meaningful Assessment: Delhi HC DOLLAR GULATI vs PRINCIPAL COMMISSIONER OF INCOME TAX CITATION: 2024 TAXSCAN (HC) 1037 The Delhi High Court clarified that powers under Section 127 of the Income Tax Act, 1961, can be invoked for public interest, administrative convenience, and meaningful assessment. The bench observed that “the powers of Section 127 of the Act can be invoked for public interest and administrative convenience.”

Thus, Coram of Justice Purushaindra Kumar Kaurav and Justice Yashwant Varma passed under Section 127 of the Income Tax Act. Accordingly, dismissed these writ petitions. Alleges GST Registration Cancellation Application Contains Incorrect Date: Delhi HC directs Expeditious Disposal of Application with 4 weeks M/S HARI OM ENTERPRISES VS PRINCIPAL COMMISSIONER OF DEPARTMENT OF TRADE CITATION: 2024 TAXSCAN (HC) 1038 The Delhi High Court directed the expeditious disposal of application alleging that the Goods and Service Tax ( GST ) registration cancellation application within a timeframe of 4 weeks. The GST department alleged that the registration cancellation application contained an incorrect date. The court noted that since petitioner has already replied to the notice issued by the department and has requested for cancellation of GST registration w.e.f. 18.09.2023, this petition was disposed of directing the Proper Officer to dispose of the application seeking cancellation of GST registration expeditiously within a period of four weeks from today.

E-Way Bill Downloaded prior to Interception: Allahabad HC quashes GST SCN and Penalty Order for Non-Production of Hard Copy and alleged Tax Evasion M/S MID TOWN ASSOCIATES vs ADDITIONAL COMMISSIONER GRADE-2 CITATION: 2024 TAXSCAN (HC) 1039 The Allahabad High Court has held that, it is clear that only violation is a technical  one wherein E-Way Bill was not present in the vehicle”, while quashing the Goods and Services Tax (GST) Show Cause Notice and Penalty Order for alleged tax evasion. The petitioner’s vehicle was intercepted for transporting goods without an E-Way Bill, leading to a penalty under the presumption of tax evasion. The court held that the presence of mens rea for evasion of tax is a sine qua non for the imposition of penalty. As a result, the impugned show cause notice and penalty order were quashed and set aside, and the writ petition was allowed. Kerala HC Allows Pursuit of Statutory Appeal Despite Writ Petition Dismissal, Citing Timely Filing of Petition Within Appeal Period M J GOLD vs STATE TAX OFFICER CITATION: 2024 TAXSCAN (HC) 1040 The Kerala High Court has upheld the right to pursue justice by allowing the pursuit of a statutory remedy of appeal, despite the dismissal of a writ petition. This decision ensures access to legal remedies for aggrieved parties.

The bench concluded that the appellant can be permitted to avail the statutory remedy taking into consideration the fact that the writ petition was filed challenging the order within the condonable period for filing an appeal. Kerala HC Halts Coercive Recovery Measures, Orders Swift Appeal Resolution for Co-operative Bank, Prevents Undue Financial Hardship PALLICKAL NADUVILEMURI SERVICE CO-OPERATIVE BANK LTD vs INCOME TAX OFFICER CITATION: 2024 TAXSCAN (HC) 1041 The Kerala High Court has ordered an immediate halt to coercive recovery measures by the income tax authorities against the Pallickal Naduvilemuri Service Co-operative Bank Ltd. Until the Income Tax Commissioner (Appeals) decides on the appeal, the High Court ordered a stay on any coercive actions initiated against the petitioner Bank pursuant to the assessment order and demand notice. This stay ensures that the bank is shielded from undue financial hardship during the pendency of the appeal process, providing much-needed relief to the institution and its stakeholders. Failure to Process GST Refund Claim within Statutory Time Period: Delhi HC directs Refund within Two weeks AJ FLIGHT RESERVATIONS PVT. LTD. VS COMMISSIONER OF CGST CITATION: 2024 TAXSCAN (HC) 1042 The Delhi High Court has directed the appropriate officer to expedite the refund process for a petitioner who sought the Court to direct the refund a sum of Rs.81,79,52/- under section 54 of the Central Goods and Services Act, 2017.

The bench disposed of the petition by noting that the petitioner retains the right to seek further remedies if aggrieved by any subsequent order from the GST authorities regarding the refund claim and associated interest. Addition on Unexplained Expenditure cannot be Merely Based on CBIC Instruction: Delhi HC BAUSCH AND LOMB INDIA PRIVATE LIMITED vs NATIONAL FACELESS ASSESSMENT CENTRE, DELHI CITATION: 2024 TAXSCAN (HC) 1043 The Delhi High Court in a recent case has held that addition on unexplained expenditure cannot be merely based on Central Board of Indirect Taxes and Customs ( CBIC ) instruction. It was viewed that the Assessing Officer ( AO ) must have some material to indicate that an expenditure has been made to make an addition, while the only material are the cumulative amounts, as mentioned by CBIC, without details of any expenditure. The court held that the order is unsustainable and has been passed in violation of principles of natural justice. It was viewed that the assessing officer must have some material to indicate that an expenditure has been made to make an addition, while the only material are the cumulative amounts, as mentioned by CBIC, without details of any expenditure. Delhi HC directs CESTAT to decide Appeals on Merit, Not Just Jurisdiction COMMISSIONER OF CUSTOMS vs BALAJI EXPORTS CITATION: 2024 TAXSCAN (HC) 1044 The Delhi High Court has quashed the orders passed by the Customs Excise and Service Tax Appellate Tribunal (CESTAT), stating that the orders were not justified, and directed the CESTAT to decide the appeals on merit, including the question of jurisdiction.

The court also condoned the delay in filing appeals. After directing CESTAT to decide the appeals on merits, the division bench underlined that it has not expressed any opinion on merits and CESTAT would be at liberty to take such a view as it considers appropriate. Excise Policy Case: Delhi HC resends Amit Arora to Tihar Jail on being Clinically Stable AMIT ARORA vs DIRECTORATE OF ENFORCEMENT CITATION: 2024 TAXSCAN (HC) 1045 The Delhi High Court sent Amit Arora to Tihar jail on being clinically stable in the much disputed excise policy case. The instant application under Section 482 of the Code of Criminal Procedure, 1973 (‘Cr.P.C.’) has been filed on behalf of petitioner seeking appropriate directions in view of his deteriorating medical health conditions, thereby praying that he may be shifted to Arihant Hospital, from RML Hospital, Delhi for a period of six weeks. The court noted that “In the present case, a perusal of record reveals that the petitioner has remained in the remand of ED and in jail due to his judicial custody for a period of about 115 days, on interim bail for a period of about 72 days, remained admitted in a private hospital in judicial custody for a period of 93 days, and has been admitted in the RML Hospital, New Delhi where he remains under judicial custody for a period of about 240 days approximately i.e. since 07.09.2023.”

Delhi HC restores appeal to CESTAT on Compliance of Condition of Pre deposit ANKIT MADAN vs REGISTRAR, CUSTOMS, EXCISE CITATION: 2024 TAXSCAN (HC) 1046 The Delhi High Court has restored the appeal before the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT), as the condition of the deposit was complied with. The court allowed the writ petition and stated that subject to the writ petitioner depositing costs of INR 2 lakhs within two weeks. The court allowed the writ petition and stated that subject to the writ petitioner depositing costs of INR 2 lakhs within two weeks, the appeal shall stand restored on the Board of CESTAT to be considered on merits and by law. Non-Compliance of Conditions for Export of Banned Non Basmati White Rice: Delhi HC dismisses Writ Petition VI EXPORTS INDIA PRIVATE LIMITED vs UNION OF INDIA CITATION: 2024 TAXSCAN (HC) 1047 The Delhi High Court upheld the decision of the single bench holding that the exporter cannot be permitted to export banned non- basmati white rice, due to the non-fulfilment of the conditions entitling it to Notification bearing no. 20/2023 dated 20th July, 2023 issued by the Department of Commerce, Government of India.

The court found that the  Appellant’s averment itself is vague. The court held that the appellant has not satisfied the exemption conditions of the Notification. Brandishing Newspaper Cutting not Amounts to Sharing Commercial Expertise: Bombay HC Hindustan Export & Import Corporation Private Limited vs The Deputy Commissioner of Income-tax CITATION: 2024 TAXSCAN (HC) 1048 The Bombay High Court has held that merely brandishing newspaper cuttings does not amount to proof of sharing commercial expertise. The court found that the Assessing Officer ( AO ) was required to inquire, and for that purpose, the assessee must place on record the requisite material supporting its claim for deduction, based on which approval was procured from the Chief Commissioner of Income Tax ( CCIT ). AO cannot Draw Adverse Inference on Non response of Directors to Notices: Calcutta HC PRINCIPAL COMMISSIONER OF INCOME TAX vs ATLANTIC DEALERS PVT. LTD CITATION: 2024 TAXSCAN (HC) 1049 The Calcutta High Court held that Assessing Officers ( AO ) cannot draw adverse inferences on the non-response of directors to notices. The court, while examining the validity of the addition made under Section 68 of the Income Tax Act, 1961, found that the AO made the addition only because the directors failed to respond to the notices issued.

The court upheld the order passed by the tribunal, stating that the tribunal has done an elaborate examination of the factual matrix, which ought to have been done by the Commissioner of Income Tax (Appeals) when the appeal was decided. The matter was decided in favour of the assessee. Proceedings u/s 74 of GST Act not to be initiated against Purchaser for Non-Deposit by Supplier: Uttarakhand HC Subhash Singh vs Deputy Commissioner CITATION: 2024 TAXSCAN (HC) 1050 The Uttarakhand High Court has held that no proceedings shall be initiated against purchaser of goods under Section 74 of Goods and Services Tax Act for non-deposit of Goods and Services Tax ( GST ) by supplier.

The Court directed the petitioner to deposit 10% of the initially demanded amount by the State Goods and Services Tax department. It was also added that the department can still pursue action against M/s Dev Bhoomi Spat, the supplier, for non-filing of returns. Legitimacy of Income Not Established when Investment made from Share Premium Without Noticeable Business Activity: Calcutta HC BALGOPAL MERCHANTS PRIVATE LIMITED vs THE PRINCIPAL COMMISSIONER OF INCOME TAX -2, KOLKATA CITATION: 2024 TAXSCAN (HC) 1051 The Calcutta High Court observed that the legitimacy of income was not established when investment was made from share premium without noticeable business activity. The assessee filed the return of income disclosing a total income of Rs. NIL. The return was processed under Section 143(1) of the Income Tax Act. The court observed that the effects of these documents were considered by the tribunal and it was not satisfied with the genuineness of the transaction more importantly noting that the assessee itself has claimed that there is no noticeable business activity during the year. No Excess Claim of ITC: Delhi HC restores Matter to Proper Officer to Adjudicate SCN MRISHI MARCNDEY INDIA LTD vs SALES TAX OFFICER CLASS II/AVATO CITATION: 2024 TAXSCAN (HC) 1052 The Delhi High Court restored the matter to the Proper Officer to adjudicate show cause notice ( SCN ) as there was no excess claim of input tax credit ( ITC ). The court observed that perusal of the order dated 21.12.2023 shows that the same has been passed solely on the ground that there was no response received from the petitioner. Delhi HC refuses to grant Interim Relief against NFRA Penalties in Reliance Capital Audit Lapses to CAs and CA Firm VISHAL DHIREN SHAH vs UNION OF INDIA CITATION: 2024 TAXSCAN (HC) 1053

The Delhi High Court has refused to entertain the plea for interim relief in the writ petition filed against penalties imposed by the National Financial Reporting Authority (NFRA) on two Chartered Accountants and CA Firm, owing to the nature of misconduct and the observations in the NFRA Order. The bench cited the observations in the NFRA Order to substantiate its decision to not entertain the plea at this stage. Lack of sufficient reasons for Cancellation of GST Registration: Allahabad HC quashes Cancellation Order M/S V.P. Constructions Lko vs State Of U.P. CITATION: 2024 TAXSCAN (HC) 1054 The Allahabad High Court set aside the cancellation of Goods and Services Tax (GST) registration due to insufficient justifications in the order. The court ordered fresh proceedings. Lack of Specific Direction: Delhi HC Quashes Summons Issued by Patiala House Court MS GLOBUS INFOCOM LIMITED & ANR. vs PRINCIPAL COMMISSIONER OF CUSTOMS & ANR. CITATION: 2024 TAXSCAN (HC) 1055 The Delhi High Court quashed the summons issued by the Additional Chief Metropolitan Magistrate (ACMM), Patiala House Courts, New Delhi, for not taking cognizance or any directions for issuing the summons against the petitioner. The court directed the petitioner to bring the facts to the attention of the Additional Chief Metropolitan Magistrate. The court can then consider the relevant orders and decide whether to reissue the summons.