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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 257 on extension by SC applies to condonable period

GST Update No 257 on extension by SC applies to condonable period
The outbreak of pandemic in the country had been a great setback for all and there was lot of disruption in compliances of the taxation laws by the assessees for which appropriate extensions were also provided by the government. It is worth mentioning that the hon’ble Supreme Court had provided suo moto extension for filing appeals and various compliances. However, the question arises is whether the condonable period available to the assessee under the statutory provisions of law needs to be considered for the purpose of determining the applicability of the suo moto order of extension of limitation by the Supreme Court. Recently, on similar footings, one case was reported before Delhi High Court in the case of M/S RAILSYS ENGINEERS PRIVATE LIMITED & ANR. V/S THE ADDITIONAL COMMISSIONER [W.P.(C) 4712/2022] dated 21.07.2022. The decision delivered in this case is subject matter of discussion of our present update.
 
The petitioner challenged the show cause notice passed by the authorities regarding cancellation of registration. It was submitted that the impugned SCN is not signed and the venue of appearance before the adjudicating authority was also not mentioned and hence, there was violation of principles of natural justice. It was also stated that even the order was not signed by the adjudicating authority. Moreover, it was pleaded that the period of limitation is excluded by the suo-moto extension order passed by the Apex Court. It was submitted that the petitioner was regularly filing returns until February 2019, along with late fee for the period under consideration so their registration should not have been cancelled.
 
The Counsel of the respondent argued that the returns for continuous period of 6 months were not filed and hence, SCN was issued as regards to cancellation of registration. It was further contended that the procedure of cancellation of registration was duly complied with. It was further argued that the Suo-moto extension of period of limitation will not be applicable in present case. As regards to unsigned order, it was argued that the orders were uploaded on common portal and hence, no signatures were appended. Further, the proceedings would be concluded in online manner through video conferencing and hence, there was no mention of venue in the impugned order.
 
The Court analysed and held that the date of impugned order of cancellation of registration is 25.11.2019. Although, it is not possible to serve the order on the same date, even if it is assumed that it was served on the same date, the period of limitation as per Section 107 of the CGST Act, 2017 ends on 24.02.2020 with expiry of condonable period as on 24.03.2020. The Covid-19 outbreak triggered as on 23.03.2020, therefore, it needs to be examined whether the present case is covered by Suo-moto extension of Apex Court, it was held that the period from 15.03.2020 to 28.02.20322 is to be excluded from the period of limitation including the condonation period allowed under the respective statues. After analysing the Supreme Court order, it was concluded that the extended period of Limitation is applied to even condonable period and not just period of Limitation. As regards justification offered by the counsel for the revenue regarding non-signing of order was concerned, it was stated that at least digital signature should be appended on the SCN and order even if they were uploaded on the GST common portal.  Therefore, it was directed to set aside the impugned order in appeal and restore the appeal filed by the petitioners for decision afresh.
 
The above decision is another example wherein the show cause notice was set aside on the grounds of non-fulfilment of ingredients of proper show cause notice and order. There had been plethora of cases such as Suresh Trading Corporation V/s Assistant Commissioner wherein same view was upheld by the Court of Land thereby granting relief to the aggrieved taxpayers. This decision is also beneficial as it seeks to apply condonation benefit inspite of the fact that condonation is not automatic but is discretionary power to be exercised if there are genuine reasons for delay in filing appeal. It is high time that the departmental authorities should adhere to the guidelines of issuance of show cause notice and order and also follow the binding precedents delivered by the Supreme Court.
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