Tax Weekly Round-Up: August 04 - August 10, 2025
Kapil Dhyani
11 Aug 2025 8:40 PM IST
SUPREME COURTLet GST Council Look Into Tracking Of GST Paid On Foreign OIDAR Services : Supreme CourtCase Title – Pradeep Goyal v. Union of India & Ors.Case no. – Writ Petition No. 258 of 2021The Supreme Court recently disposed of a public interest litigation seeking directions for setting up a mechanism to track services provided by foreign entities in India under the Goods and...
SUPREME COURT
Let GST Council Look Into Tracking Of GST Paid On Foreign OIDAR Services : Supreme Court
Case Title – Pradeep Goyal v. Union of India & Ors.
Case no. – Writ Petition No. 258 of 2021
The Supreme Court recently disposed of a public interest litigation seeking directions for setting up a mechanism to track services provided by foreign entities in India under the Goods and Services Tax (GST) regime.
A bench of Justice BV Nagarathna and Justice KV Viswanathan passed the order after briefly hearing Advocate Charu Mathur, who appeared for the petitioner. During the hearing, Advocate Mathur submitted, “If Facebook provides some services or OpenAI provides some services, there is no way to track those by the Indian Government and we are losing out on a lot of revenue.”
Income Tax Act | Supreme Court Delivers Split Verdict On Timelimit For Assessments Under S.144C
Cause Title: ASSISTANT COMMISSIONER OF INCOME TAX & ORS. VERSUS SHELF DRILLING RON TAPPMEYER LIMITED
The Supreme Court on Friday (Aug. 8) delivered a split verdict on the interpretation of the limitation period under Section 144C of the Income Tax Act, 1961 (“Act”), governing the timeline for passing assessment orders by the Assessing Officer in cases involving eligible assessees, such as foreign companies and transfer pricing matters.
Justice BV Nagarathna ruled that Section 153(3)'s twelve-month cap still governs even in Section 144C proceedings, rendering the assessments time-barred. However, Justice SC Sharma held that the timelines in Section 144C operate independently of Section 153(3) and exclude its outer limit for DRP cases, stating that applying Section 153 could impact tax recovery.
HIGH COURTS
Bombay HC
Case Title: Pune Municipal Corporation v. Assistant Commissioner of Income Tax, TDS Circle, Pune and Ors.
Case Number: WRIT PETITION NO.9551 OF 2025
The Bombay High Court held that Section 194C and Section 194LA of the Income Tax Act would not apply when TDR Certificates are issued in lieu of compensation.
Justices B.P. Colabawalla and Firdosh P. Pooniwalla agreed with the assessee that the words “or by any other mode” appearing in Section 194C would have to be read ejusdem generis to the words “payment thereof in cash or by issue of a cheque or draft”. Similarly, in Section 194LA, the words “or by any other mode” would have to be read ejusdem generis to the words “payment of such sum in cash or by issue of a cheque or draft”.
Serving Order On Chartered Accountant Doesn't Count As Service On Assessee: Bombay High Court
Case Title: Mrs. Neelam Ajit Phatarpekar v. The Assistant Commissioner of Income Tax
Case Number: MISCELLANEOUS CIVIL APPLICATION NO.491 AND 492 OF 2024
The Bombay High Court held that serving order on chartered accountant doesn't count as service on assessee. The issue before the bench was whether the copy of the order passed by the Tribunal when served upon the Chartered Accountant is sufficient service and whether it can be construed as 'copy received by the assesse/applicant'.
Justices Bharati Dangre and Nivedita P. Mehta stated that the Chartered Accountant since is not also authorised specifically to accept copy of the order, cannot be said to be a recognised agent of the Assessee.
Chhattisgarh HC
ITC Not Available On Cess For Electricity Supplied To Residential Township: Chhattisgarh High Court
Case Title: Bharat Aluminium Company Limited v. State of Chhattisgarh
Case Number: WPT No. 14 of 2021
The Chhattisgarh High Court held that input tax credit is not available on cess for electricity supplied to residential township.
Justice Sanjay K. Agrawal stated that the electricity generated is used in the course of or furtherance of his business, which is evident from Form G provided by the taxpayer(assessee), hence, the assessee would not be entitled for ITC to electrical energy consumed for maintenance of its township.
Delhi HC
Case title: Ambika Traders Through Proprietor Gaurav Gupta v. Additional Commissioner, Adjudication DGGSTI, CGST Delhi North
Case no.: W.P.(C) 4853/2025
The Delhi High Court has held that consolidated show cause notice under Section 74 of the CGST is not only permissible but necessary, to unearth wrongful availment of ITC over a span of period.
A division bench of Justices Prathiba M. Singh and Rajneesh Kumar Gupta observed, “The nature of ITC is such that fraudulent utilization and availment of the same cannot be established on most occasions without connecting transactions over different financial years. The purchase could be shown in one financial year and the supply may be shown in the next financial year. It is only when either are found to be fabricated or the firms are found to be fake that the maze of transactions can be analysed and established as being fraudulent or bogus.”
GST Refund Can't Be Granted To Trader Until Cancelled Registration Is Restored: Delhi High Court
Case title: Shree Radhe Vallabh Traders v. Commissioner Central Goods And Service Tax, Delhi East Commissionerate, New Delhi
Case no.: W.P.(C) 6768/2023
The Delhi High Court has made it clear that GST refund cannot be granted to a trader whose GST registration stands cancelled. In the case at hand, the Petitioner's registration was cancelled in February 2023 with retrospective effect from July 2018.
In this backdrop a division bench of Justices Prathiba M. Singh and Shail Jain observed, “When the GST registration itself has been cancelled in 2018, obviously, no refund can be granted till the said GST registration of the Petitioner is restored.”
Phrase 'Three Months' U/S 73(2) GST Act Means Three Calendar Months, Not 90 Days: Delhi High Court
Case title: Tata Play Ltd v. Sales Tax Officer Class II/ Avato
Case no.: W.P.(C) 4781/2025
The Delhi High Court has held that the 'three months' period prior to expiry of three years within which show cause notice for alleged wrongful availment of Input Tax Credit must be issued under Section 73 of the CGST Act, means three calendar months and not 90 days.
A division bench of Justices Prathiba M. Singh and Rajneesh Kumar Gupta observed, “While the purpose behind Section 73(10) of the CGST Act is to fix the date by which an adjudication order has to be issued, the purpose of Section 73(2) of the CGST Act is to ensure that at least three months is available to the taxable person for filing a reply to the show cause notice issued to them and for being heard in a proper manner…the expression 'three months' has to be reckoned and interpreted as three calendar months and not as 90 days.”
Case title: Shri Sarabjeet Singh , Proprietor Of M/S Khurana Associates v. The Commissioner Of SGST, Delhi SGST & Ors.
Case no.: W.P.(C) 10392/2025
The Delhi HIgh Court has held that once a trader prefers an appeal against a demand raised by the GST Department and makes the mandatory pre-deposit, the demand order is automatically stayed and the trader cannot be treated as a defaulter.
A division bench of Justices Prathiba M. Singh and Rajneesh Kumar Gupta thus granted relief to the Petitioner-proprietorship firm and directed the Department to process its request for a fresh GST registration.
Case title: Shamina v. Commissioner Of Customs
Case no.: W.P.(C) 7230/2025
The Delhi High Court recently granted relief to a woman whose 998 purity (equivalent to 24 karat) gold jewellery was treated as prohibited goods under the Baggage Rules 2016, and absolutely confiscated by the Customs Department on her return to the country.
A division bench of Justices Prathiba M. Singh and Rajneesh Kumar Gupta observed, “On the aspect of personal effects and jewellery, the Adjudicating Authority has merely held that because of the purity, the same cannot be considered as personal jewellery as it is prohibited goods. This is contrary to the settled law.”
Gauhati HC
Case Title: Naser Ali Mondal v The State of Assam and Ors
Case Number: WP(C)/4157/2025
The Gauhati High Court held that merely attaching tax determination statement to Drc-01 summary cannot be treated as a valid show cause notice.
Justice Sanjay Kumar Medhi stated that “…a formal and duly authenticated SCN is mandatorily required to initiate proceedings under Section 73. The Statement of tax determination under Section 73(3), which is attached to the summary cannot be treated as a valid SCN. Therefore, initiating proceedings solely based on such a statement is not in conformity with law.”
Kerala HC
Case Title: J. Vijayakumar v. Assistant Commissioner
Case Number: WP(C) NO. 4274 OF 2023
The Kerala High Court has held that transactions involving the display of advertisements on hoardings are not taxable under the Kerala Value Added Tax Act (KVAT), where the right to use has not been transferred.
Justice Ziyad Rahman A.A. agreed with the assessee that the charges collected by the assessee for displaying the advertisement included the charges for erection, printing and maintenance, etc. Thus, the responsibility to maintain the hoarding was with respect to the assessee, and the assessee had collected separate charges for the same as well.
Madras HC
Case Title: Vajra Global Consulting Service LLP v. Assistant Director of Income Tax
Case Number: W.P.No.18560 of 2023
The Madras High Court held that digital marketing is a business and not a profession; and an audit report is not required for turnovers below Rs. 5 crores.
Justice Krishnan Ramasamy stated that “Digital Marketing is the business for persons who carry out the said activities. In the event anybody carrying on the business of Digital Marketing with cash transactions both on the aspect of receipts and payments in cash below 5% of the turnover, which is below Rs.5 Crores as per the proviso to Section 44 AB (a), the said assessee is not required to file an audit report and they are exempted.”
Punjab & Haryana HC
Case Title: Harvinder Singh v. State of Punjab and others
Case Number: CWP-9172-2025
The Punjab and Haryana High Court stated that failure to notify commissioner of partner's retirement makes former partner liable for firm's GST. Section 90 of the CGST Act, 2017 extends the liability in case of partnership firm to its partners as well.
Justices Lisa Gill and Sudeepti Sharma stated that “intimation of retirement of partner has to be given to the Commissioner by notice in writing and that in case, no such intimation is given within one month from the date of retirement, liability of such partner under first proviso shall continue until the date on which such intimation is received by the Commissioner.”
TRIBUNALS
Drawback Not Allowed Where Refund Exceeds Market Value Of Goods: CESTAT
Case Title: M/s Modak Dyeing & Printing Co. Pvt. Ltd. v. Commissioner of Customs
Case Number: CUSTOMS APPEAL NO. 53962 OF 2023
The New Delhi Bench of Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has stated that drawback not allowed where refund exceeds market value of goods.
Dr. Rachna Gupta (Judicial Member) and P.V. Subba Rao (Technical Member) opined that if the transaction value (FOB value) is so high, that the drawback due on the goods exceeds the market value of the goods, then, as per section 76(1) (b), no drawback shall be allowed.