Tax Weekly Round-Up: April 21 - April 27, 2025
Kapil Dhyani
28 April 2025 8:05 PM IST
HIGH COURTSBombay HCAmalgamated Company Can Adjust Written Down Assets Of Constituent Companies & Claim Depreciation Without Central Govt Approval: Bombay HCCase Title: Technova Imaging Systems Limited v. Deputy Commissioner of Income TaxCase Number: INCOME TAX APPEAL NO. 405 OF 2003The Bombay High Court stated that amalgamated company can adjust written down of assets of...
HIGH COURTS
Bombay HC
Case Title: Technova Imaging Systems Limited v. Deputy Commissioner of Income Tax
Case Number: INCOME TAX APPEAL NO. 405 OF 2003
The Bombay High Court stated that amalgamated company can adjust written down of assets of amalgamating companies and claim depreciation without central government's approval. The Division Bench of Chief Justice Alok Aradhe and Justice M.S. Karnik stated,
“The Tribunal was not justified in law in holding that in view of insertion of Section 72A in the Income Tax Act, 1961, the assessee (being the amalgamated company) not having obtained approval of the Central Government was not entitled to adjust the written down value of the assets of the amalgamating companies on the basis of depreciation actually allowed to them and to claim depreciation on such adjusted written down value of the assets of the amalgamating companies.”
Delhi HC
Case title: M/S Impressive Data Services Private Limited v. Commissioner (Appeals-I), Central Tax Gst, Delhi
Case no.: W.P.(C) 4662/2025
The Delhi High Court has made it clear that it has no discretion to allow a prayer seeking waiver of pre-deposit condition prescribed under Section 107(6) of the Central Goods and Services Tax Act, 2017 for preferring an appeal under the statute. In terms of Section 107(6), insofar as the admitted tax, interest or penalty is concerned, the entire amount would have to be deposited. In so far as the disputed amount is concerned, 10% of the tax would have to be deposited as a pre-deposit along with the appeal.
The division bench of Justices Prathiba M. Singh and Rajneesh Kumar Gupta observed that Section 107(6) “ does not give discretion for waiver of the pre-deposit.”
Case title: Commissioner Of Income Tax Exemption Delhi v. IILM Foundation
Case no.: ITA 179/2023 and batch
The Delhi High Court has held that a Charitable Trust's status cannot be taken away citing violation of Section 13 of the Income Tax Act, 1961 merely because it made reasonable payment for services rendered by a related party.
Ordinarily, Charitable Trusts are not allowed to make payments for the benefit of 'prohibited parties'. The division bench of Justices Vibhu Bakhru and Tejas Karia however ruled that if such payment is reasonable, in exchange for the services offered by such a prohibited person, the exemption can be claimed.
Case title: Exide Industries Ltd. v. Assistant Commissioner, CGST & Ors.
Case no.: W.P.(C) 4822/2025
The Delhi High Court has set aside a GST demand of over ₹12 crores raised on storage battery manufacturer Exide Industries, for wrongful availment of Input Tax Credit.
A division bench of Justices Prathiba M. Singh and Rajneesh Kumar Gupta however imposed a cost of ₹1 lakh on the Indian multinational for “laxity” in responding to the repeated hearing notices issued by the Department.
Case title: Ms Stesalit Limited & Anr v. Union Of India & Ors.
Case no.: W.P.(C) 3138/2025
The Delhi High Court will soon decide the GST rate applicable to roof-mounted air conditioners of specific designs manufactured for the railways.
A division bench of Justices Prathiba M. Singh and Rajneesh Kumar Gupta are seized with a petition filed by railways and aerospace technology company StesaLIT Limited, challenging a Circular issued by the Union Finance Ministry in 2024, stipulating that above said AC units shall be classified under HSN 8415 (which attracts 28% GST) and not HSN 8607 (which attracts 18% GST).
Case title: M/S Perfetti Van Melle India Pvt Ltd Additional Commissioner (Adjn.) v. CGST Delhi North & Ors
Case no.: W.P.(C) 2178/2025
The Delhi High Court has asked the Adjudicating Authority under Central Goods and Service Tax Act 2017 to undertake fresh adjudication of the show cause notice issued to an assessee, raising demand of more than ₹10 crores.
A division bench of Justices Prathiba M. Singh and Rajneesh Kumar Gupta did so after noting that such a “substantial” demand was made without even considering the assessee's reply.
Case title: M/S Brijbihari Concast Pvt. Ltd. (Through Its Director Sh. Rajeev Agarwal) v. Directorate General Of Goods And Services Tax Intelligence Meerurt Zonal Unit (Through Its Additional Director General) & Anr.
Case no.: W.P.(C) 8433/2024
The Delhi High Court has asked the GST authority not to prejudice the business of an assessee, involved in manufacturing of mild steel products, by attaching its complete bank account pending adjudication of ₹15.09 crores tax evasion proceedings.
A division bench of Justices Prathiba M. Singh and Rajneesh Kumar Gupta noted that one year had elapsed since the provisional attachment order was passed but no show cause notice was issued.
Sikh People Usually Wear 'Kada', Personal Effect: Delhi High Court Sets Aside Detention By Customs
Case title: Dalvinder Singh Sudan v. Commissioner Of Customs
Case no.: W.P.(C) 5136/2025
Observing that Sikh persons usually wear kada as part of their religious practice, the Delhi High Court set aside the detention of a Dubai resident's gold kada by the Customs Department.
A division bench of Justices Prathiba M. Singh and Rajneesh Kumar Gupta observed, “Clearly, a perusal of the photographs and the fact that it is one Kada which is usually worn by persons like the Petitioner who are Sikhs, leaves no doubt in the mind of the Court that the same was a personal effect of the Petitioner.”
Case title: J. G'S Departmental Store v. Income Tax Officer Ward 60(1) & Ors.
Case no.: W.P.(C) 13669/2024
The Delhi High Court has set aside the reassessment action initiated against a partnership firm under Section 148A(d) of the Income Tax Act, 1961 over cash deposits made by it during demonetisation, stating that this ground was not mentioned in the notice issued to the firm under Section 148A(b).
Holding that reasons for initiating action under Section 148A(d) must be mentioned in the SCN under Section 148A(b), a division bench of Justices Vibhu Bakhru and Tushar Rao Gedela said, “Concededly, there was no allegation in the notice issued under Section 148A(b) of the Act that the cash deposited by the Assessee in its bank account during the demonetization period was disproportionately higher in comparison with the cash deposited during the corresponding period in the previous financial year. Thus, the Assessee had no opportunity to provide any explanation in respect of such allegation.”
Case title: Haris Aslam v. Commissioner Of Customs
Case no.: W.P.(C) 4962/2025
The Delhi High Court has held that the Customs Department cannot sit over an appellate body's order directing it to release the goods of an assessee, merely on the ground that the Department seeks to prefer a revision against such order.
A division bench of Justices Prathiba M. Singh and Rajneesh Kumar Gupta held, “once the Commissioner of Customs (Appeals) has also allowed redemption, the decision to file revision cannot be a ground to withhold the release of the goods. Further, there is no stay which has been granted by the Commissioner of Customs (Appeals).” Also Read - Delhi HC Sets Aside Reassessment Over Cash Deposits During Demonetisation, Says Order U/S 148A(d) Income Tax Act Transgressed Notice U/S 148A(b)
Case title: Bhavna Luthra L/H Of Sh. Narain Das Luthra, Proprietor Of M/S. Hunny Enterprises v. Assistant Commissioner, Range 8, CGST, Delhi & Anr
Case no.: W.P.(C) 4551/2025
The Delhi High Court recently recorded the “harrowing experience” that a widow had to go through for obtaining a refund from the GST Department. The GST registration of the firm owned by her now deceased husband was cancelled in view of his death. However, his widow sought a refund of ₹10,45,793/- balance in the electronic cash ledger of the firm. The said application was rejected by the Department and subsequently, the amount was debited from the Ledger without either being paid to the petitioner or being re-credited in the Ledger.
“It is a matter of concern that almost a year ago, the same Petitioner had appeared before a Coordinate Bench of this Court, which, after considering the matter, directed that the refund amount be re-credited within a period of two weeks. It is unfortunate to see that despite the said amount being in the Electronic cash ledger, the refund has not been given to the Petitioner till date,” Court said.
Madras HC
Case Title: M/s. Poomika Infra Developers v. State Tax Officer
Case Number: W.P. Nos.33562
In a recent ruling, the Madras High Court held that service of notices and orders through Common portal is a valid mode of service in terms of Section 149 of the GST Act. The bench rejected the argument that the GST portal is not a “designated computer resource of the assessee” and hence as per Sec. 13 (2) (a) (ii) of the Information Technology Act, receipt occurs only when the communication is retrieved.
“Service by making it available in the common portal is a valid mode of service in terms of Section 169 of the GST Act. Service is complete when it enters the common portal i.e., when it is made available in the common portal,” stated the bench of Justice Mohammed Shaffiq.
Case Title: M/s. Axiom Gen Nxt India Private Limited v. Commercial State Tax Officer
Case Number: W.P.No.1114 of 2025
The Madras High Court stated that if the taxpayer is not at all participating in the proceedings, even after repeated uploading of notices and reminders in GST portal, the Department should have resorted to other mode of service, viz., Registered Post with Acknowledgement Due (RPAD), so that considerable time of officers, assessee and the Court could be saved. The court extensively referred to the provisions of the Information Technology Act and concluded, while service through portal is “sufficient” service, it is not “effective" service”.
The Bench of Justice Krishnan Ramasamy stated that “once if no response was received for the notices, viz., ASMT-10, DRC-01A, DRC-01, etc., which were uploaded in the common portal by the department, atleast they have to send the subsequent reminders by way of RPAD. If anyone notice is received by the assessee, he cannot make a plea that they were unaware of the notices, which were uploaded in the common portal.”
Case Title: Tai Industries Ltd. v. The State of Tamilnadu
Case Number: W.A.No.474 of 2021
The Madras High Court stated that Article 304 of the Constitution applies only to goods imported from other states or union territories and not to goods imported from outside India.
The Division Bench consists of Chief Justice K.R. Shriram and Justice Mohammed Shaffiq looked into the case of State of Kerala and others v. Fr. William Fernandez and other, (2021) 11 SCC 705 and observed that the goods imported after having been released from customs barriers are not immune from any kind of State taxation. The States are free to levy taxes on goods imported into the State.
Patna HC
Case Title: Anil Kumar Singh v. The Union of India and Others
Case no.: Civil Writ Jurisdiction Case No.9105 of 2024
The Patna High Court has recently quashed a service tax demand raised against a government contractor, ruling that merely not registering for service tax could not be equated with fraud or suppression of facts warranting the application of the five-year extended limitation period under the Finance Act, 1994.
The Division Bench comprising Justice Rajeev Ranjan Prasad and Justice Sourendra Pandey, observed, “the plea of the respondent that the petitioner had not taken registration of the service tax would alone not be a reason to believe that he has committed a fraud or has wilfully suppressed his liability to pay the tax. Rule 4A casts a duty upon every person providing taxable service (not later than thirty days from the date of completion of such taxable service whichever is earlier to issue an invoice, a bill or as the case may be a challan signed by such person or a person authorised by him in respect of such taxable service provided or agreed to be provided.”
TRIBUNALS
Case Title: M/s JLC Electromet Private Limited Versus Commissioner, Customs, Jodhpur, Headquarters Jaipur
Case Number: Customs Appeal No. 51722 OF 2022
The New Delhi Bench of Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has stated that same rate tax and interest applicable on IGST in the course of inter-state trade and supplies in the course of imports.
The Bench of Dilip Gupta (President) and P.V. Subba Rao (Technical) has observed that, the taxable event to levy IGST is the inter-state supply of goods and services (including supplies in the course of international trade). If there is no supply, there is no scope to levy IGST even if goods are imported.
Case Title: Commissioner of Service Tax, Delhi Versus M/s. ITC Ltd, Gurgaon
Case Number: Service Tax Appeal No. 1086 OF 2011
The New Delhi Bench of Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has stated that supply of manpower to five hotels for a period of nearly three years would clearly attract service tax under the head of “manpower recruitment or supply agency service”.
The Bench of Dilip Gupta (President) and P.V. Subba Rao (Technical) has observed that, “In relation to manpower supply to five units on cost recovery basis, the Commissioner noticed that ITC had deputed employees to other hotels to operate and maintain those hotels in line with ITC Welcome group standards and run those hotels in a smooth and efficient manner. Thus, supply of manpower to five hotels for a period of nearly three years would clearly attract service tax under the head of “manpower recruitment or supply agency service”.”
OTHER DEVELOPMENTS
Centre Imposes 12% Temporary Tariff On Certain Steel Imports, Duty Valid For 200 Days
The Government has imposed a temporary 12% safeguard duty on the import of certain non-alloy and alloy steel flat products. The safeguard duty covers products such as cold-rolled coils sheets; metallic coated steel coils and sheets; hot-rolled coils and sheets; hot rolled plate mill plates; and colour-coated coils and sheets, whether or not profiled.
The duty will not be imposed on the product categories when imported into India at or above the specified import price on cost insurance freight basis.
The Central Board of Indirect Taxes and Customs (CBIC) through Notification 256(E), under the Union Ministry of Finance, has officially released a comprehensive set of rules outlining the functioning of the Goods and Services Tax (GST) Appellate Tribunal.
As per the notification the GST Appellate Tribunal (Procedure) Rules, 2025 took effect on 24th April, 2025. The rules have been introduced with an objective of promoting uniformity, procedural clarity and digital efficiency in the functioning of the Appellate Tribunal.