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Taxpayers must keep their contact details updated to avoid missing gst notices

GST taxpayers must maintain updated contact details as email service constitutes valid notice under Section 169
A taxpayer registered under GST must maintain updated contact details to ensure receipt of official notices. The Allahabad High Court ruled that serving notices on registered email addresses constitutes valid service under Section 169 of the CGST Act and Section 13 of the Information Technology Act, 2000, without violating fundamental rights. The court determined that electronic records are deemed received when entering the designated computer system. While taxpayers bear responsibility for maintaining current contact information, tax authorities must ensure reasonable service methods. The decision emphasizes that providing incorrect or inaccessible email addresses may not constitute valid defense, though this depends on individual case facts. - (AI Summary)

Written by Kamal aggarwal

Co-Author Aditi vishnoi

14 Jul 2025

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Revision under income tax act, 1961 protecting the interests of revenue

Section 263 allows senior tax officials to revise erroneous orders prejudicial to revenue within two-year limitation period
The Income Tax Act's Section 263 allows senior tax officials to revise orders by lower authorities that are erroneous and prejudicial to revenue interests. An order is deemed erroneous if passed without proper inquiry, allowing relief without verification, or not following Board instructions or court decisions. Revision orders must be made within two years from the financial year end when the original order was passed. Two court cases illustrate limitation issues: revenue authorities cannot invoke Section 263 to revise matters covered in original assessments when the revision relates to issues not part of subsequent reassessments, as the limitation period runs from the original assessment date, not reassessment dates. - (AI Summary)

Written by Dr.mariappan govindarajan

14 Jul 2025

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Gstat (procedure) rules – part 9

Central Government notifies GST Appellate Tribunal Procedure Rules 2025 for record inspection in appeals
The Central Government notified the Goods and Services Tax Appellate Tribunal (Procedure) Rules, 2025, effective from April 24, 2025. The rules establish procedures for record inspection in GST appeals. Applicants or authorized representatives can inspect case records by submitting Form GSTAT-FORM-03 to the Registrar with a Rs. 5,000 fee. Applications must be filed two days before inspection, between 10:30 AM to 1:30 PM. Inspection occurs under officer supervision during specified hours, with strict prohibitions against record damage or marking. A register must be maintained documenting all inspections using Form GSTAT-CDR-06. - (AI Summary)

Written by Dr. sanjiv agarwal

14 Jul 2025

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Clerical error cannot justify confiscation under section 130 without intent to evade tax

Clerical error in tax invoice listing "copra" instead of "dry grapes" doesn't justify confiscation under Section 130 CGST Act
A company transporting dry grapes faced confiscation proceedings when enforcement authorities discovered a clerical error in the tax invoice listing "copra" instead of "dry grapes" at one line item. The Karnataka High Court ruled that confiscation under Section 130 of the CGST Act was unjustified where the error was merely typographical, all taxes were paid, and no intent to evade tax existed. The court emphasized that the department must prove intent to evade tax in clerical error cases, noting the correct description appeared in the e-way bill and supporting documents were genuine. The confiscation order was quashed and refund directed. - (AI Summary)

Written by Bimal jain

14 Jul 2025

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Tracing the trajectory: evolution and interpretation of actionable claims

Transfer of actionable claims under Property Act 1882 excludes GST when qualifying as debt or beneficial interest
The article examines the concept of actionable claims under the Transfer of Property Act, 1882, focusing on their tax implications. An actionable claim is defined as a claim to debt or beneficial interest in movable property not in the claimant's possession, which courts recognize as grounds for relief. The beneficial interest must be proprietary rather than merely contractual, and may be existent, accruing, conditional, or contingent. Courts have recognized various rights as actionable claims, including assignment of contract benefits, insurance money rights, and provident fund credits. For GST purposes, the property must qualify as an actionable claim in the transferor's hands at the time of transfer to be excluded from tax. - (AI Summary)

Written by Pooja jajwni

14 Jul 2025

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Limitation for filing application for refund computable from the date of conciliation agreement crystallising the excess-tax quantum

Excess GST refund limitation period starts from conciliation settlement date, not original payment date
A taxpayer entered a rental agreement and paid GST based on original transaction values. Following disputes, a conciliation agreement reduced the lessee's liability by 40%, creating excess GST payments. The tax department rejected refund applications as time-barred, arguing limitation began when tax was originally paid. The High Court ruled that where excess tax becomes ascertainable only after conciliation settlement having decree-like force, limitation runs from the settlement date under statutory provisions, not from original payment date, making the refund claims timely filed. - (AI Summary)

Written by Bimal jain

14 Jul 2025

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Supreme court ruling warns homebuyers: registration is not ownership

Property registration alone doesn't guarantee legal ownership; buyers must verify payment, possession, and original title documents
The Supreme Court ruled that property registration alone does not establish legal ownership, emphasizing that buyers must verify complete payment, possession, and original title documents. The court warned that registered transactions can be invalidated due to fraud, incomplete payment, seller incapacity, or lack of proper approvals. Legal experts recommend conducting thorough due diligence including examining 30-year title history, checking encumbrances, verifying zoning permissions, and ensuring no pending litigation before property purchase. The ruling reinforces the principle of caveat emptor, warning buyers that registration provides only prima facie evidence of transaction validity, not guaranteed ownership rights. - (AI Summary)

Written by Ramesh agrawal

12 Jul 2025

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Cross-examination under gst law: a critical right in tax proceedings

Cross-examination right in GST proceedings essential for natural justice when authorities rely on witness statements
GST law recognizes cross-examination as a critical right rooted in natural justice principles, particularly when tax authorities rely on third-party witness statements to impose demands or penalties. While documentary evidence can be rebutted through written submissions, witness statements require cross-examination for effective challenge. Courts remain divided on timing - some allow pre-notice cross-examination while others require it post-notice. Judicial precedents consistently hold that denial of cross-examination, especially when proceedings rely solely on uncorroborated witness statements, violates natural justice and can render orders invalid. However, cross-examination may be denied when adequate corroborative documentary evidence exists and no prejudice results. The right serves as a procedural safeguard ensuring fair adjudication in tax proceedings. - (AI Summary)

Written by Mohit gupta

12 Jul 2025

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Hc rules that confiscation and penalty proceedings cannot be initiated under section 130 of the cgst act in cases where excess stock is found; directs for refund of amount already deposited

Excess stock alone cannot trigger Section 130 confiscation proceedings under CGST Act, falls under Sections 73-74
The Allahabad High Court ruled that confiscation and penalty proceedings under Section 130 of the CGST Act cannot be initiated solely based on excess stock being found. A coal depot challenged confiscation and penalty orders under Section 130, arguing the issue was covered by established precedent. The court followed its earlier ruling in a similar case, which was affirmed by the Supreme Court, holding that mere presence of excess stock does not justify Section 130 proceedings. Instead, such matters fall under Sections 73 and 74 of the CGST Act concerning tax liability determination and recovery. The court quashed the confiscation orders and directed refund of deposited amounts. - (AI Summary)

Written by Bimal jain

12 Jul 2025

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Form vs substance in gst: a principle revisited

GST Form versus Substance Doctrine: Courts Favor Economic Reality Over Technical Documentation Errors
The article examines the application of the form versus substance doctrine in India's Goods and Services Tax system. This principle prioritizes the economic reality of transactions over their formal documentation. Under GST, the doctrine applies to place of supply determinations, fake invoicing cases, Input Tax Credit denials for technical errors, and composite versus mixed supply classifications. Recent court decisions, including cases from Allahabad High Court, emphasize substance over procedural lapses, ruling that genuine supplies shouldn't be penalized for minor documentation errors. The rigid application of form-based compliance creates litigation, harassment of taxpayers, and contradicts GST's seamless credit system objectives. The article advocates for balanced interpretation prioritizing substance in cases of bona fide errors where actual tax payment occurred and no revenue loss exists. - (AI Summary)

Written by Jayaprakash gopinathan

12 Jul 2025

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Show cause notice under section 74 unsustainable in absence of any allegation of fraud, misstatement, or suppression

Section 74 CGST notice quashed for Rs 260 crore demand lacking fraud allegations or willful misstatement
The Allahabad High Court quashed a show cause notice issued under Section 74 of the CGST Act against a company for a demand of Rs. 260 crores. The court held that Section 74 notices are unsustainable without specific allegations of fraud, willful misstatement, or suppression of facts. The notice merely referenced earlier Section 73 proceedings and stated that the company's explanation could not be verified, lacking the essential jurisdictional prerequisites for invoking Section 74. The court clarified that authorities remain free to initiate fresh proceedings in accordance with law. - (AI Summary)

Written by Bimal jain

12 Jul 2025

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Gst registration cancellation: judicial safeguards and the principle of natural justice

GST registration cancellation requires natural justice principles and proper reasoning beyond automatic non-filing penalties
Recent Bombay High Court judgments establish that GST registration cancellation must follow natural justice principles. Courts ruled that cancellations cannot be automatic for non-filing returns; assessees must receive opportunities to comply. Technical portal glitches cannot prejudice taxpayers' rights to respond. Administrative orders must contain independent reasoning beyond merely restating show-cause notices. Revenue authorities bear the burden of proving fraud allegations with specific evidence rather than bald assertions. Cancellation orders cannot rely on grounds not mentioned in original show-cause notices. These rulings emphasize that while GST authorities have enforcement powers, procedural fairness and reasoned decision-making are mandatory requirements that protect taxpayers' substantive rights. - (AI Summary)

Written by Abhishek raja

11 Jul 2025

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Where respondent-assessee was granted bail and no complaint had been filed against him even after 5 years have elapsed since the investigation began, the bail cannot be cancelled

GST fraud accused granted bail upheld despite Rs.33.75 crore fake invoice allegations
A respondent-assessee was granted bail after arrest for allegedly availing fraudulent input tax credit of Rs.33.75 crores through fake invoices. The GST Intelligence department challenged the bail order, arguing it was granted prematurely without considering related cases. The Delhi High Court dismissed the petition, holding that bail cancellation requires supervening circumstances. The court noted no complaint was filed despite five years of investigation, the accused deposited over 10% of disputed liability, fulfilled bail conditions, and would have been entitled to default bail if in custody. The bail was upheld with original conditions maintained. - (AI Summary)

Written by Bimal jain

11 Jul 2025

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Duty credit scrips (dcs) – gst implications and input tax credit (itc) reversal

GST Input Tax Credit reversal not required on sale of exempt Duty Credit Scrips under amended Rule 43
The article examines GST implications of Duty Credit Scrips (DCS), export promotion incentives issued under India's Foreign Trade Policy. DCS were initially subject to GST but became exempt from October 2017. Tax authorities subsequently demanded Input Tax Credit reversal under Section 17(2) of CGST Act when exporters sold unused DCS, treating them as exempt supplies. Exporters argued DCS are policy incentives not directly linked to input consumption. The Central Board of Indirect Taxes and Customs provided relief through Notification 14/2022, amending Rule 43 to exclude DCS value from exempt supplies calculation, eliminating ITC reversal requirements. The amendment is interpreted as retrospectively applicable from the original exemption date, allowing exporters to reclaim previously reversed credits. - (AI Summary)

Written by Satyajit naik

11 Jul 2025

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Gst exemption on long term lease of land for industrial or for development of infra for financial business

Government entities with 20% ownership can lease industrial plots tax-free under GST exemption Section 11
GST exemption on long-term land leases has evolved significantly since July 2017. Initially limited to state government industrial development corporations leasing to industrial units for 30+ years, the scope expanded to include plots for financial business infrastructure development. Government ownership requirements decreased from 50% to 20% by January 2020. Current exemptions apply to upfront amounts for industrial plots or financial business infrastructure plots leased by entities with 20%+ government ownership. Strict conditions mandate industrial/financial use, state monitoring, joint liability for violations, and specific lease agreement terms. Residential developments remain taxable despite qualifying lessor ownership. - (AI Summary)

Written by Manoj kasture

11 Jul 2025

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The moratorium overrides the provisions of foreign exchange management act, 1999

Corporate assets protected from attachment during insolvency proceedings under Section 14 and Section 33(5) despite FEMA violations
A corporate debtor underwent liquidation proceedings under the Insolvency and Bankruptcy Code while facing enforcement action under the Foreign Exchange Management Act. The Enforcement Directorate issued notices for provisional attachment of properties worth over Rs. 138 crores for alleged export proceeds violations. The liquidator challenged these notices, arguing that the moratorium under Section 14 and Section 33(5) of the Code prohibited such proceedings. The High Court ruled that the Code's provisions override FEMA due to its non-obstante clause in Section 238, while FEMA lacks such provision. The court quashed the attachment notices, holding that once insolvency proceedings commence, assets cannot be attached as they must be sold through the prescribed liquidation process. - (AI Summary)

Written by Dr.mariappan govindarajan

11 Jul 2025

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Mere reliance on the reply of the driver of the vehicle in order to process confiscation and imposition of fine & penalty contrary to section 130 of the cgst act

High Court quashes confiscation order under Section 130 CGST Act for denying proper hearing opportunity
The Uttarakhand High Court set aside a confiscation order and penalty imposed under Section 130 of the CGST Act, ruling that tax authorities violated due process by completing the entire proceeding on the same day without providing proper hearing opportunity to the consignor. The court found that relying solely on the driver's statement, who lacked authority to represent the consignor, was arbitrary and contrary to Section 130(4) which mandates opportunity of being heard before imposing confiscation or penalty. The matter was remitted back for fresh proceedings with proper notice. - (AI Summary)

Written by Bimal jain

11 Jul 2025

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Gst@8 – the indian tax odyssey part iii: the compliance paradox – technology, tax terror & the trust deficit

India's GST system struggles with compliance paradox as enforcement practices undermine self-assessment design after nine years
India's GST system, entering its ninth year, faces a compliance paradox where advanced technology coexists with enforcement-heavy practices and taxpayer mistrust. Originally designed for self-assessment with minimal human interface, the system now features frequent notices, audits, and credit blockages. Input Tax Credit has become problematic, with buyers facing liability for vendor defaults under Section 16(2)(c) and Rule 86A allowing discretionary credit blocking. Procedural rigidity affects businesses through complex filing requirements and punitive late fees. Enforcement has hardened since 2020, featuring arrests under Section 132 and frequent inspections. While courts provide relief through interventions, the author advocates for compliance empathy, dispute prevention, and legal certainty in future reforms. - (AI Summary)

Written by Navjot singh

10 Jul 2025

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Certain concerns and clarification on eou debonding/exit

EOUs must pay customs duty, cess, and IGST on unutilized materials when exiting or debonding operations
Export Oriented Units (EOUs) exiting or debonding must pay customs duty, cess, and Integrated GST on unutilized raw materials and capital goods originally imported duty-free. Payment obligations include customs duty calculated at debonding date rates with depreciation benefits for capital goods, IGST under applicable provisions, and interest only if payment is delayed beyond the stipulated period after duty assessment. The debonding process requires application to Development Commissioner, stock verification, duty assessment, payment, and obtaining No Dues Certificate. Interest liability arises only when assessed duty remains unpaid beyond the allowed timeframe, typically thirty days from demand order, not from import date. A notification exempts interest on customs duties for specific capital goods and equipment when cleared from bonded warehouses. - (AI Summary)

Written by Yagay andsun

10 Jul 2025

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In-depth analysis of input tax credit under the gst act: section 18 – availability of credit in special circumstances

Section 18 GST Act allows input tax credit during registration transitions and business changes within 30 days
Section 18 of the GST Act provides input tax credit availability in special circumstances. Registered persons can claim ITC when obtaining new or voluntary registration, transitioning from exempt to taxable supplies, or switching from composition to regular scheme. Credit can be claimed on inputs in stock, semi-finished/finished goods, and capital goods (with prescribed reductions). Claims must be made within 30 days of eligibility. The section covers business transfers, requiring tax payment on capital goods supply, and ensures consistent ITC treatment across transitions while maintaining government revenue protection. - (AI Summary)

Written by Rajagopal k

10 Jul 2025

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