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Corporate News *  Missing seized records must be considered while testing ITC claim; duplicate GST demands ordered corrected: Delhi High Court. *  GST appeal can’t be rejected without addressing taxpayer’s grounds: Allahabad High Court. *  Surplus IGST credit can offset CGST, SGST shortfall: GSTAT. *  GST refund can’t be denied when cancelled airfares are returned with tax: GSTAT. *  3 Hearing notices issued within 2 minutes: Gujarat High Court flags portal flaw, seeks report. *  GSTR-9, GSTR-9C filing for FY 2025-26 enabled; pending GSTR-1 and GSTR-3B must be filed first. *  Dupattas are exempt fabrics, can’t be taxed as fibres at 4%: Madras High Court. *  Full transitional credit allowed on capital goods received after GST rollout: GSTAT denies Rs. 6.99 lakh export duty credit. *  GST return mismatch alone can’t justify fraud proceedings: GSTAT orders fresh adjudication under section 73. *  Supplier found non-existent later can’t alone justify input tax credit denial: GSTAT. *  GST interest stops once tax reaches government account, can’t run until return filing: GSTAT. *  Cancelled flat booking- GST refund can’t be denied without excluding COVID period from limitation: GSTAT. *  India notifies rules of origin for India–New Zealand FTA. *  Incomplete E-bike kits classifiable as complete vehicles, but not eligible for CKD duty concession: CESTAT. *  Same GST rate on main input and output can’t by itself bar inverted duty refund: GSTAT. *  Unjust enrichment doesn’t apply to customs refunds from assessments finalised before July 13, 2006: Gujarat High Court. *  CENVAT credit can’t be denied solely because plant And machinery are embedded in earth: Karnataka High Court. *  DFIA exports ineligible for RoDTEP benefits; customs directs repayment with applicable interest. *  Second E-Way bill alone doesn’t prove another supply: GSTAT. *  Bail denied in Rs. 1.19 crore fake GST refund case over risk of accused absconding again: Punjab and Haryana High Court. *  GST registration can be restored after revocation deadline if outstanding dues are paid: Gauhati High Court. *  Multiple GST proceedings over same suppliers: Calcutta High Court directs dept. to share findings for adjudication. *  E-Governance portal services not OIDAR, fixed deposit interest not taxable: CESTAT. *  Rs. 500 Stamp duty required on authority letters for CAs, CMA and GST practitioners in Pune GST division.  *  Rs. 1.10 crore GST refund must be paid in cash after business closure: Allahabad High Court. *  Godown rent attracts 18% GST even when used exclusively for exempt agricultural warehousing: AAR. *  GST portal launches "Multi-State Registration" facility: one master TRN for registration applications across multiple States/UTs. *  RoDTEP scheme extended till 31st December, 2026.  *  Mere disagreement with order can’t override Rs. 20 lakh appeal limit: GSTAT. *  Customs interest can’t be backdated before confiscation liability is determined; nearly 8 year period excluded: Delhi High Court.
Subject News *  GST summons: anticipatory bail maintainable without arrest order, but relief denied in evasion case: Allahabad High Court. *  GST Appeal can’t be decided without hearing taxpayer’s objections to fresh evidence: Allahabad High Court. *  GST ITC can’t be reversed merely because supplier grants discount without reducing tax liability: GSTAT. *  Mere quoting of GST provision is not a valid charge: GSTAT quashes ITC denial. *  Personal hearing mandatory before adverse GST order, even without taxpayer’s request: Rajasthan High Court. *  Parallel bail pleas without full disclosure amount to abuse of process Rs. 43.08 crore GST case sent for fresh hearing: Supreme Court. *  GST refund based on unchallenged advance ruling can’t be recovered using later circular: GSTAT. *  Payment of GST alone doesn’t end interest and penalty liability when tax and interest remain unpaid beyond 30 days of notice: GSTAT. *  GST demand over builders’ 80% procurement rule requires reasoned adjudication: GSTAT. *  Eligible ITC doesn’t automatically entitle taxpayers to compensation cess refund on domestic sales: GSTAT. *  GST confiscation order passed before reply deadline invalid: GSTAT. *  GST interest can’t be retained after tax refund on delayed export receipts: Punjab & Haryana High Court. *  GST appeal can’t be dismissed over pre-deposit shortfall without opportunity To respond: Bombay High Court. *  DGGI SCN can’t be challenged before reply and adjudication:Chhattisgarh High Court. *  GST input tax credit can’t be denied solely due to supplier’s retrospective registration cancellation: GSTAT. *  GST notice must explain fraud allegations; merely repeating section 74 Is not enough:  Himachal Pradesh High Court. *  Audit detection alone can’t justify GST fraud penalty; specific suppression must be proved: GSTAT. *  GST order uploaded only under ‘Additional Notices’ tab without separate intimation set aside: Calcutta High Court. *  Service Tax appeal can’t be rejected for missing pre-deposit proof when payment is already recorded: CESTAT. *  SGST dept. can’t hear appeal against CGST order: Calcutta High Court. *  Mere dispatch of tax order can’t prove service or make appeal time-barred: CESTAT. *  Dealer incentives can’t be taxed merely on ledger entries: CESTAT. *  DGFT orders quashed for failure to supply DRI letter relied upon in SCN: Bombay High Court. *  GST penalty u/s 122(1A) can’t apply to Pre-2021 transactions; unregistered beneficiaries also covered: Delhi High Court. *  Expired E-way bill caused by wrong PIN code can’t justify GST penalty without intent to evade tax: GSTAT. *  Used railway rails can’t be taxed as track material without proof they are fit for reuse: CESTAT. *  Earlier DGGI notice doesn’t bar separate GST demand on different issue: Delhi High Court. *  ITC dispute involves no question of law: GSTAT directs appeal to Vice-President. *  Earlier DGGI notice doesn’t bar separate GST demand On different issue: Delhi High Court. *  No E-way bill required for interstate goods movement in november 2017: GSTAT quashes detention and penalty.  

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GST Update No 160 on cancellation of registration without issuance of SCN

GST Update No 160 on cancellation of registration without issuance of SCN
The provision in GST law regarding cancellation of registration by the revenue authorities for non-filing of GST returns for continuous period of 6 months is draconian as GST registrations are cancelled even in cases where the assessee had filed belated returns. Moreover, it is observed that often the decision of cancellation of registration is taken without following the prescribed procedure such as issuance of show cause notice. It is well established principle of Law that the principle of natural justice is mandatorily required to be followed for passing a valid and legitimate order. The issue regarding cancellation of registration without considering the reply of the assessee was recently raised before the hon’ble Calcutta High Court in the case of LATIKA GHOSH VS THE COMMERCIAL TAX OFFICER/ASSISTANT COMMISSIONER. The decision imparted in this case is the subject matter of discussion of our present update. The petitioner filed a Writ Application and prayed for interim relief for restoration of certificate of registration and issuing Writ of Mandamus. The revenue authorities issued a show cause notice on 06.06.2018 wherein it was proposed to cancel the certificate of registration on the grounds that the petitioner have not filed returns for a continuous period of 6 months. However, the appellant filed their pending returns as soon as the notice was received along with payment of tax, late fee and interest. On 08.02.2021, revenue authorities cancelled the registration and reference was made to show cause notice dated 06.06.2018. The Counsel for the petitioner argued that a show cause notice dated 02.12.2019 was issued proposing cancellation of registration. To this, the petitioner argued that the said notice was never uploaded on the portal. Further, on 11.09.2021 departmental authorities issued show cause for rejection of revocation application of cancellation since appellant failed to pay late fee for the period from 2017 to 2021 along with interest. The petitioner submitted they had filed reply as on 12.09.2021. However, the application of revocation was rejected finally on 06.10.2021. The counsel of the department argued that order for cancellation of registration was passed on 06.10.2021 since no specific prayer was sought by the appellant in the writ application. The Court held that order for cancellation of registration passed on 08.02.2021, violated the principles of natural justice. Further, the contention raised by department as regards to the fact that no specific prayer was sought is incorrect. It was stated that the department did not indicate to the appellant as to how the computation of late fee and interest for the aforesaid period is incorrect. Therefore, the order of cancellation of registration is not tenable. The authorities were directed to restore the GST registration and issue a show cause notice to the petitioner in case of shortfall in payment of late fee. It is submitted that there have been numerous decisions rendered on the issue that registration cannot be cancelled in case of violation of principles of natural justice. Reference to the said judicial pronouncements is as follows:- • C.B. GAUTAM V/S UNION OF INDIA AND OTHERS • TURRET INDUSTRIAL SECURITY PVT. LTD. V/S UNION OF INDIA • VIVAA TRADECOM PVT. LTD. V/S STATE OF GUJARAT • TATA STEEL BSL LTD. V/S UNION OF INDIAs It is submitted that in the garb of exercising the discretion to cancel registration on account of non-filing of returns by the assessee and not restoring the same, the revenue authorities are infact contributing to loss of revenue to the government. Time and again, the revenue authorities are directed to adhere to the principle of natural justice by passing order only after granting an opportunity of being heard to the taxpayers so that fair judgments can be imparted failing which it will result into abuse of power and harassment of the taxpayers.
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