Tax Weekly Round-Up: March 24 - March 30, 2025
Kapil Dhyani
31 March 2025 6:40 PM IST
SUPREME COURT'Timelines To Rectify Bonafide GST Form Errors Must Be Realistic' : Supreme Court Asks CBIC To Re-examine ProvisionsCase title : CENTRAL BOARD OF INDIRECT TAXES AND CUSTOMS v. M/S ABERDARE TECHNOLOGIES PRIVATE LIMITED & ORS.Case no.: SPECIAL LEAVE PETITION (CIVIL) Diary No. 6332/2025The Supreme Court recently underscored the need for the Central Board of Indirect Taxes...
SUPREME COURT
Case title : CENTRAL BOARD OF INDIRECT TAXES AND CUSTOMS v. M/S ABERDARE TECHNOLOGIES PRIVATE LIMITED & ORS.
Case no.: SPECIAL LEAVE PETITION (CIVIL) Diary No. 6332/2025
The Supreme Court recently underscored the need for the Central Board of Indirect Taxes and Customs to fix realistic timelines for correcting bonafide errors by the assesses in forms when filing GST returns.
The bench of CJI Sanjiv Khanna and Justice Sanjay Kumar was hearing a challenge to the Bombay High Court order which allowed an assesee to rectify its form GSTR-1 after missing the deadline under S. 39(9) of the CGST Act. The order was challenged by the Central Board of Indirect Taxes and Customs (CBIC).
Case title: THE UNION OF INDIA & ORS. v. BRIJ SYSTEMS LTD & ORS.
Case no.: SPECIAL LEAVE PETITION (CIVIL) Diary No. 6334/2025
The Supreme Court recently issued notice to the Central Board of Indirect Taxes and Customs (CBIC) over the recurrent issue of not allowing rectification of bonafide errors made after the lapse of prescribed deadlines under the CGST Act.
The bench of CJI Sanjiv Khanna and Justices Sanjay Kumar and KV Viswanathan was hearing a challenge by the Union against the decision of the Bombay High Court which allowed the rectification of bonafide errors by the assessee in GSTR-1 Form despite missing the deadline under S. 39(9) of the CGST Act 2017. Here the assessee wanted to rectify the returns filed for Financial Year 2017-2018 in Form GSTR-1. The application to rectify was rejected on the ground that the time to rectify had ended.
Case Title: GASTRADE INTERNATIONAL VERSUS COMMISSIONER OF CUSTOMS, KANDLA
In a key decision, the Supreme Court today overturned the confiscation of imported goods labelled as "Base Oil SN 50," which customs authorities had classified as High-Speed Diesel (HSD), which only the State entities can import.
The Court found that the Customs Department failed to provide conclusive evidence proving the goods were High-Speed Diesel (HSD), due to inadequate laboratory testing and conflicting expert opinions.
Supreme Court Issues Notice In Challenge To West Bengal Taxes On Entry Of Goods Act
Case Title – Samsung India Electronics Pvt. Ltd. v. State of West Bengal & Ors.
Case no. – Petition for Special Leave to Appeal (C) No.7295/2025
The Supreme Court is set to examine the constitutional validity of the West Bengal Taxes on Entry of Goods into the Local Areas Act, 2012, as amended by the West Bengal Finance Act, 2017, along with related Rules and notifications.
A bench of Justice JB Pardiwala and Justice R Mahadevan recently issued notice returnable on April 22, 2025 in a batch of petitions challenging the constitutional validity of the Act. The Finance Act amended various provisions of the Entry Tax Act with retrospective effect.
HIGH COURTS
Delhi HC
Case title: Jai Durga Rubberised Fabrics India Pvt. Ltd. v. Commissioner Of Customs
Case no.: W.P.(C) 530/2025
The Delhi High Court recently took a critical view of the Customs Excise And Service Tax Appellate Tribunal at New Delhi for repeatedly passing contradictory orders in an appeal, which should have been dismissed for want of pecuniary jurisdiction.
“This order reveals a complete comedy of error…The petition reveals an unfortunate situation wherein the CESTAT while intending to correct an error in its initial order…continued to make repeated errors resulting in the impugned order and the present challenge,” a division bench of Justices Prathiba M. Singh and Rajneesh Kumar Gupta remarked at the outset.
Delhi High Court Orders Customs To Release 'Name Engraved' Gold Jewellery Of Indian Tourist
Case title: Sai Kiran Goud Tirupathi v. Commissioner Of Customs
Case no.: W.P.(C) 3347/2025
The Delhi High Court has ordered the Customs Department to release the gold kada of an Indian tourist, which was seized upon his return to the country after a visit to the Republic of Mali.
Petitioner had argued that the jewellery was a personal effect, as evident from engraving of his first name on the same, and was thus exempted from duty. A division bench of Justices Prathiba M. Singh and Rajneesh Kumar Gupta ordered that the jewellery be released within four weeks.
Case title: Commissioner Of Income Tax (Exemptions) v. Indian Broadcasting Foundation
Case no.: ITA 469/2023
In an order bringing relief to the Indian Broadcasting Foundation (IBF), which was incorporated to protect the interests of various stakeholders in the field of television broadcasting, the Delhi High Court allowed the body to claim exemption from payment of tax under Sections 11 and 12 of the Income Tax Act, 1961.
A division bench of Justices Vibhu Bakhru and Dr. Swarana Kanta Sharma observed, “BARC, being a company registered under Section 25 of the Companies Act, is legally prohibited from distributing any dividends or profits to its shareholders. Additionally, in the event of liquidation, Memorandum of Association of BARC mandates that any surplus must be transferred to another company registered under Section 25 of the Companies Act with similar objectives, thereby negating any possibility of personal gain or profit for the Assessee from its deployment of funds.”
Case title: Paras Products v. Commissioner Central Gst, Delhi North (and batch)
Case no.: W.P.(C) 6235/2023 and batch
The Delhi High Court has held that Section 11A of the Central Excise Act 1944, which empowers taxing authorities to recover duties not levied/ short-levied or short-paid, is pari materia to corresponding provisions of the Customs Act, the Finance Act and the CGST Act.
A division bench of Justices Yashwant Varma and Harish Vaidyanathan Shankar thus held that the High Court's judgment in M/S VOS Technologies India Pvt. Ltd. v. The Principal Additional Director General & Anr. (2024) is applicable to the said provision.
Case title: Husky Injection Molding Systems Shanghai Ltd & Ors. v. Union Of India & Ors.
Case no.: W.P.(C) 3431/2025
The Delhi High Court has held that writ petitions challenging the determination of anti-dumping duties by Directorate General of Trade Remedies are maintainable however, since the determination is a time bound process, Courts will not readily interfere in the process.
A division bench of Justices Prathiba M. Singh and Rajneesh Kumar Gupta observed, "while the writ petitions cannot be held to be not maintainable at the stage of the disclosure statement, the Court would be hesitant and reluctant in exercising jurisdiction as determination of anti-dumping duty is a time bound process which is to be exercised by the designated authority."
Case title: Mohammad Arham v. Commissioner Of Customs
Case no.: W.P.(C) 2760/2025
The Delhi High Court has held that detention of goods by the Customs Department cannot continue beyond a period of one year, if a show cause notice was not issued to the assessee within such period.
A division bench of Justices Prathiba M. Singh and Rajneesh Kumar Gupta cited Section 110 of the Customs Act, 1962 which prescribes a period of six months. Further, subject to complying with certain formalities, a further extension for a period of six months for the Department to issue a show cause notice can be given in terms of Section 110(5).
Case title: Huawei Telecommunications India Company Private Limited v. Assistant Commissioner Of Income Tax Central Circle 2 & Anr.
Case no.: W.P.(C) 10867/2024
The Delhi High Court has held that when an appellate authority has asked the Income Tax Department to not take any coercive steps against an assessee for recovery of outstanding demands, the same can in some cases interdict the Department from adjusting the outstanding amount from refunds due to the assessee.
A division bench of Justices Vibhu Bakhru and Tejas Karia took note of a Punjab and Haryana High Court judgment which held that an adjustment would amount to 'coercive proceedings'.
Case title: Rakesh Kumar Gupta v. DRI
Case no.: W.P.(C) 11518/2024
The Delhi High Court has called upon the Customs Department to clone the required data from seized electronic devices of persons allegedly involved in smuggling and other violations under the Act, instead of retaining such devices throughout prosecutions.
A division bench of Justices Prathiba M. Singh and Rajneesh Kumar Gupta observed that such a practice will not only ensure that the Department does not lose the data due to the seized device getting outdated but it will also provide make the data readily accessible to the investigation officers.
Case title: The Commissioner Of Central Tax, CGST Delhi East v. M/S Simplex Infrastructure Limited
Case no.: CEAC 3/2024
The Delhi High Court has upheld an order of the Customs Excise and Service Tax Appellate Tribunal interdicting the GST Department from invoking extended period of limitation for recovery action against a sub-contractor who did not pay service tax amid confusion as to his liability to pay the same.
A division bench of Justices Prathiba M. Singh and Rajneesh Kumar Gupta upheld the CESTAT order which held that bonafide belief of the sub-contractor that he was not required to discharge service tax liability cannot be ruled out amid prevailing controversy.
Case title: Vedanta Limited v. CBIC
Case no.: W.P.(C) 3675/2025
The Delhi High Court has asked the Central Board of Indirect Taxes and Customs to pass a “reasoned order” on Indian multinational mining company- Vedanata's plea claiming duty drawbacks on clean energy cess, paid between the year 2010-17.
The plea was rejected by CBIC through a “cryptic order” citing limitation despite its own Instruction clearing air on eligibility of drawbacks on clean energy cess, with retrospective benefit to pending cases, a division bench of Justices Prathiba M. Singh and Rajneesh Kumar Gupta noted.
Case title: Backbone Overseas v. Assistant Commissioner Of Customs, Foreign Post Office , New Delhi And Anr.
Case no.: W.P.(C) 3711/2025
The Delhi High Court has criticised the Customs Department for acting against its own Circular for expeditious clearance of goods, by detaining the export goods of a trader for over two months.
A division bench of Justices Prathiba M. Singh and Rajneesh Kumar Gupta observed, “This position is completely unacceptable to the Court…consignment cannot be held up in this manner…expedited steps are not taken for clearing of goods.”
Case title: Shiv Parkash Bansal v. Deputy Commissioner Of Income Tax Central Circle-14 Delhi & Ors.
Case no.: W.P.(C) 11156/2023
The Delhi High Court has held that the statutory scheme of Sections 153A and 153C of the Income Tax Act, 1961 does not envisage the discovery of a connection or interrelationship between the searched and the non-searched entity.
A division bench of Justices Yashwant Varma and Harish Vaidyanathan Shankar held that the trigger for Section 153C is the discovery of articles in the course of a search which pertain or belong to a third party, and which may have a bearing on the determination of the total income of such other person.
Karnataka HC
Case Title: B G Parmeshwara AND Bangalore Development Authority & Others
Case No: WRIT PETITION No.51001 OF 2019 (BDA) C/W WRIT PETITION No.7028 OF 2022
The Karnataka High Court has reiterated that if the transaction of booking a residential house is entered into before the completion of construction and the consideration was paid (partly or fully) before issuance of completion certificate, the same would amount to supply of services requiring payment of the service tax (GST) by the purchaser.
Justice M G S Kamal recently dismissed a batch of petitions filed by B g Parmeshwara and others which had challenged the endorsement issued by Bangalore Development Authority (BDA) calling upon the petitioners to pay amount towards the service Tax (GST) under the provisions of the Central Goods and Services Tax Act, 2017, before registration of the apartment.
Kerala HC
Customs Department Can't Invoke Expired Bank Guarantees: Kerala High Court
Case Title: M/s Itma Hotels India Pvt. Ltd. v. The Additional Commissioner of Customs
Case Number: WA NO. 2183 OF 2023
The Kerala High Court stated that invocation of the expired bank guarantees by Customs Department is not permissible under law.
The Division Bench of Justices A.K. Jayasankaran Nambiar and Easwaran S. were addressing the issue of whether the customs department can invoke expired bank guarantees.
Case Title: Malabar Institute of Medical Sciences Ltd. v. The Deputy Commissioner of Income Tax
Case Number: ITA NO. 11 OF 2025
The Kerala High Court stated that the order passed by the Commissioner of Appeals under Section 263 of the Income Tax Act cannot be under any circumstances construed as a closed remand and there is no requirement to challenge the order under Section 263 separately.
The Division Bench of Justices A.K. Jayasankaran Nambiar and Easwaran S. observed that “In as much as the Commissioner of Income Tax (Appeals) had decided the appeal preferred by the assessee against the revised assessment order on merits, it was incumbent upon the tribunal to have decided the appeal on merits rather than finding that the assessee ought to have questioned the order under Section 263 in a separate proceeding. Therefore, the tribunal erred egregiously in dismissing the appeal preferred by the assessee as 'not maintainable''.
Rajasthan HC
Case Title: Sharda Devi Chhajer v. Union of India and others
Case Number: D.B. Civil Writ Petition No. 11787/2024
The Rajasthan High Court stated that the Jurisdictional Assessing Officer (JAO) lacks jurisdiction to issue income tax reassessment notices under section 148 of the Income Tax Act, 1961.
The Bench of Justice Pushpendra Singh Bhati and Munnuri Laxman observed that “the JAO shall not have the jurisdiction to issue notices under Section 148 of the Act of 1961, as it would not only render Section 151A weak, but may also lead to its diminishing activation.”
TRIBUNALS
Service Tax Leviable On RIICO And RASMB For Commercial And Industrial Construction Services: CESTAT
Case Title: M/s. Gokulnath Construction Company v. Commissioner of Central Excise & Central GST, Jaipur
Case Number: Service Tax Appeal No. 53032 OF 2018
The New Delhi Bench of Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has stated that there is a service tax liability on RIICO and RASMB for commercial and industrial construction services.
The Bench of Dr. Rachna Gupta (Judicial) and Hemambika R. Priya (Technical) was addressing the issue of the tax liability of the service provider providing “Commercial and Industrial Construction Service” to the public authorities.
Amount Recovered Towards Penalty Is Not A Service, Service Tax Not Leviable: CESTAT
Case Title: M/s. AVVNL V. Principal Commissioner of CGST & Central Excise, Jaipur
Case Number: Service Tax Appeal No. 51973 of 2019
The New Delhi Bench of Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has stated that the amount recovered towards penalty is not a consideration for any activity and as a result there is no 'service'. Therefore, no service tax is leviable.
The Bench of Bintu Tamta (Technical) and P.V. Subba Rao (Technical) has observed that, “the amount recovered by the assessee towards penalty is not a consideration for any activity which has been undertaken by the assessee and as a result there is no 'service' in terms of Section 65B (44) of the Act.”
Service Tax Not Leviable On Excess Transportation Charges Recovered From Buyers: CESTAT
Case Title: M/s. Honda Motorcycle and Scooter India Pvt. Ltd. v. Commissioner of Service Tax
Case Number: Service Tax Appeal No. 51587 of 2017
The New Delhi Bench of Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has stated that service tax is not leviable on excess transportation charges recovered from the buyers.
The activity of arranging transportation of goods till the dealer's premises cannot be classified under “Business Auxiliary Service” and, therefore, no service tax is payable on transportation related expenses recovered in excess by the assessee from their buyers, stated the Bench of Binu Tamta (Judicial) and P.V. Subba Rao (Technical).
Customs Broker Cannot Be Faulted For Trusting Government-Issued Certificates: CESTAT
Case Title: Ravi Dhanwariya v. The Commissioner of Customs-New Delhi -Airport And General
Case Number: Customs Appeal No. 54889 OF 2023
The New Delhi Bench of Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has stated that when a government officer issues a certificate or registration with an address to an exporter, the Customs Broker cannot be faulted for trusting the certificates so issued.
The Tribunal opined that “If there are documents issued by the Government Officers which show that the client is functioning at the address, it would be reasonable for the Customs Broker to presume that the officer is not wrong and that the client is indeed, functioning at that address.”
Case title: Kapil Dev Nikhanj v. ACIT
Case no.: ITA No. 1770/Del/2023
The Income Tax Appellate Tribunal at Delhi allowed renowned cricketer Kapil Dev to claim exemption on Rs. 1.5 crore one-time benefit granted to him by the BCCI in 2013, in recognition of his services.
Noting that the cricketer had offered the amount for tax under ignorance, bench of M. Balaganesh (Accountant Member) and MS Madhumita Roy (Judicial Member) said, “It is trite law that right amount of tax should be collected from the right person in accordance with law. Article 265 of the Constitution provides that no tax could be collected except by an authority of law. When a statute specifically provides a particular exemption of a particular receipt from tax, the said receipt cannot be brought to tax merely because the assessee had offered erroneously in the return of income.”
Student Almanac And Teacher Planner Not Exigible To Excise Duty: CESTAT
Case Title: M/s Sona Printers Pvt. Ltd. v. The Commissioner of Central Tax, Appeal
Case Number: EXCISE APPEAL NO. 55542 OF 2023
The New Delhi Bench of Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has stated that Student Almanac and teacher planner not exigible to excise duty.
The Bench of Justice Dilip Gupta (President) and P.V. Subba Rao (Technical Member) has observed that the submission of the assessee that since Student Almanac is used only by students of a particular school, it becomes a product of printing industry cannot be accepted.
OTHER DEVELOPMENTS
The Ministry of Finance has told the Parliament that the Income Tax officials cannot access the personal emails, social media accounts and bank accounts of all assesses.
However, there is a provision in the new Income Tax Bill 2025, which allows Income Tax officals, in certain cases of search and seizure, to access the computer systems of the assesses by "overriding the access code", if the assesse is not cooperating.