RATIO OF LATEST JUDGEMENTS ON GST
Union of India & Ors. Vs Shantanu Sanjay Hundekari (Special Leave Petition (Civil) Diary No.55427/2024) (Supreme Court of India)
The Hon’ble Supreme Court upheld the Judgment of Hon’ble High Court wherein personal penalty imposed on employee (vicarious liability) U/s 122 of CGST Act,2017 was quashed on the grounds that it was highly unconscionable and disproportionate for the concerned officer of the Revenue to demand from the petitioner an amount of Rs.3731 crores, which in fact is clearly alleged to be the liability of the Company, as the contents of the show cause notice itself would demonstrate, The petitioner would not be incorrect in contending that the purpose of issuing the show cause notice to the petitioner who is merely an employee, was designed to threaten and pressurize the petitioner and thus is misapplication of relevant provisions under Sections 122(1-A) and 137 of the CGST.
Mukesh Kumar Singh Vs. the Commissioner (W.P. (T) No. 3141 of 2024) (Jharkhand High Court)
The Hon’ble High Court has directed the GST Department to pay Rs. 25,000/- as cost to the petitioner, for non-compliance with Sections 107(8) and 107(12) of the GST Act. The Court observed that the Appellate Authority failed to provide the petitioner with an opportunity to be heard, as required by Section 107(8). In addition to this, no written, reasoned order was given as mandated by Section 107(12).
Shri Shambhu Prasad Vs the State of Assam and Ors Case No.: (WP(C)/6807/2024) (Gauhati High Court)
The Hon’ble High Court held that the Summary of the Show Cause Notice in GST DRC-01 cannot replace the actual Show Cause Notice required under Section 73(1). The Court emphasized that the Proper Officer must issue a formal Show Cause Notice to initiate proceedings, and mere attachment of a tax determination statement in GST DRC-01 is not sufficient to fulfil the requirement of Section 73 of CGST Act,2017.
KBS Industries Ltd & Anr. Vs The Customs Central Excise and Service Tax Settlement Commission (W.P.(C) 10505/2024 & CM APPL. 43170/2024) (Delhi High Court)
The petitioners challenged the constitutional validity of the Notification No. 18/2015-Cus dated 01.04.2015 being discriminatory and arbitrary. The petitioners claim that the said notification is beyond the statutory mandate of the Act read with the Customs Tariff Act, 1975. The Petitioner had imported goods under an exemption scheme, agreeing to export them within specific conditions. However, when the export obligations were not met, the Customs Department imposed interest on the delayed payment of duties. The Settlement Commission rejected Petitioner’s application for rectification, noting that Section 154 of the Customs Act only allows for correcting clerical or arithmetical errors, which was not applicable here. The Hon’ble High Court upheld the Settlement Commission’s decision, stating that the interest levy on IGST was not contrary to law, as the exemption was granted under the condition of fulfilling export obligations. The Court cited Section 25(1) of the Customs Act, allows the Central Government to impose conditions for exemptions from specified duties, including the requirement to pay interest if the importer does not fulfil export obligations.
Locking of auto-populated liability in GSTR-3B
The decision of making non-editable of auto-populated liability in GSTR-3B is currently not being implemented from January tax period, on the GST Portal.
It may be noted that the above change will be introduced soon and trade will be informed accordingly. Taxpayers are encouraged to prepare for the said change.
Circular No. 244/01/2025-GST dated 28/01/2025– In line with the GST Council’s recommendations from its 53rd meeting (June 22, 2024), the Central Board of Indirect Taxes and Customs has issued clarification regarding the payment of GST on co-insurance premiums under the Central Goods and Services Tax Act, 2017.
- No GST Payable on:
- Apportionment of co-insurance premium by the lead insurer to co-insurers in co-insurance agreements, provided the lead insurer pays all relevant taxes on the total premium.
- Services by insurers to reinsurers where ceding or reinsurance commissions are deducted, subject to the reinsurer paying applicable taxes on the gross premium.
- Regularization of GST Payment: GST payment for the activities above is now regularized for the period from July 1, 2017, to October 31, 2024, on an ‘as is where is’
Circular No. 245/02/2025-GST (Clarifications regarding applicability of GST on certain services – reg.) dated 28/01/2025-
- Applicability of GST on penal charges being levied by the Regulated Entities
The Finance Ministry has clarified that no GST is payable on penal charges levied by Regulated Entities (REs) in compliance with RBI directions dated August 18, 2023. These charges, imposed for breach of loan contract terms, are considered penalties for non-compliance and fall outside the scope of GST.
2.Whether GST exemption under Sl. No. 34 of notification No. 12/2017-CTR dated 28.06.2017 is available to payment aggregators in relation to settlement of an amount, up to two thousand rupees in a single transaction, transacted through credit card, debit card, charge card or other payment card services?
The Circular has also clarified the GST exemption for RBI-regulated Payment Aggregators (PAs) when settling amounts up to ₹2,000 per transaction through credit/debit/charge cards. PAs, which manage the pooling and transfer of payments to merchants, qualify as “acquiring banks” under the relevant GST exemption rules (Sl. No. 34, notification No. 12/2017-CTR). This exemption applies only to payment settlement services and does not extend to Payment Gateway (PG) services, which do not involve handling funds.
3. Regularizing payment of GST on research and development services provided by Government Entities against consideration in the form of grants received from Government Entities.
The GST Council has clarified that research and development services provided by Government Entities or specified institutions (under section 35 of the Income Tax Act) against government grants will be exempt from GST, effective from October 10, 2024 (Notification No. 08/2024-CT(Rate)). Issues regarding the taxability of such services from 2017 to October 2024 have been resolved, and GST payments are regularized for this period on an ‘as is where is’ basis.
4.Regularizing payment of GST on skilling services provided by Training Partners approved by the National Skill Development Corporation
As per the 55th GST Council meeting, the exemption for GST on services provided by NSDC-approved Training Partners has been reinstated. This applies to services provided from October 10, 2024, to January 15, 2025, and is regularized for this period. The exemption is aligned with the new skill development framework.
5.Applicability of GST on facility management services provided to Municipal Corporation of Delhi (MCD) Headquarters
GST is applicable on facility management services provided to the Municipal Corporation of Delhi (MCD) HQ for the upkeep of its office building. These services, including housekeeping and maintenance, are not covered by the exemption for services related to functions entrusted to municipalities under the Constitution (Article 243W). Therefore, GST will be levied on these services as they do not fall under the scope of the relevant exemption (Sr. No. 3A of Notification No. 12/2017-CTR).
6.Whether Delhi Development Authority (DDA) is a local authority as per section 2(69) of the CGST Act, 2017?
It has been clarified that the Delhi Development Authority (DDA) does not qualify as a local authority under section 2(69) of the CGST Act, 2017.
7.Regularizing payment of GST on Reverse Charge (RCM) basis on renting of commercial property by unregistered person to a registered person for taxpayers registered under composition levy.
The GST Council has regularized the payment of GST on Reverse Charge (RCM) for renting commercial property by unregistered persons to registered persons under the
composition levy, for the period from October 10, 2024, to January 15, 2025. The Council recommended that payment of GST on reverse charge basis on renting of immovable property other than residential dwelling (commercial property) by unregistered person to a registered person for taxpayers registered under composition levy may be regularized on ‘as is where is’ basis for the intervening period (i.e., date of effect of notification No. 09/2024-CTR dated 08.10.2024 to date of issuance of amending notification No. 07/2025-CT(Rate) dated 16.01.2025). This follows the new rule introduced on October 10, 2024, under Notification No. 09/2024-CTR.
8.Regularizing payment of GST on certain support services provided by an electricity transmission or distribution utility.
The GST Council has also regularized the payment of GST on incidental or ancillary services related to electricity transmission or distribution, provided by utilities, for the period from October 10, 2024, to January 15, 2025. This includes services such as renting metering equipment, testing of meters, and issuing duplicate bills. These services are now exempt under the revised Notification No. 08/2024-CTR, with alignment of entries under Notification No. 6/2025-CTR. As recommended by the 55th GST Council, the payment of GST on certain incidental or ancillary services to the supply of transmission or distribution of electricity, as mentioned in Para 9.1 above, supplied by an electricity transmission or distribution utility is regularized for the period 10.10.2024 to 15.01.2025, on ‘as is where is’ basis.
9.Regularizing the payment of GST on services provided by M/s Goethe Institute/Max Mueller Bhawans.
The 55th GST Council has approved the regularization of GST payments for services provided by Goethe Institutes/Max Mueller Bhawans for the period from July 1, 2017, to March 31, 2023, on an ‘as is where is’ basis.
DUE DATES | |||||
LAST DATE TO ISSUE GST SHOW CAUSE NOTICE & ORDER FOR F.Y. 2017-18 TO F.Y. 2020-21 | |||||
TAX PERIOD (F.Y.) DUE DATE OR EXTENDED DATE OF ANNUAL RETURN | NON-FRAUD CAESE u/s 73 of CGST | FRAUD CASES u/s 74 of CGST | |||
NOTICE | ORDER | NOTICE | ORDER | ||
3 MONTHS BEFORE ORDER | WITHIN 3 YRS OF DUE DATE OF ANNUAL RETURN | NOTICE 6 MONTHS BEFORE ORDER | WITHIN 5 YR OF DUE DATE OF ANNUAL RETURN | ||
2017-18 | 05-Feb-2020 | 30-Sep-2023 (Time barred) | 31-Dec-2023 (Time Barred) | 05-Aug-2024 (Time Barred) | 05-Feb-2025 (Approaching) |
2018-19 | 31-Dec-2020 | 31-Jan-2024 (Time Barred) | 30-Apr-2024 (Time Barred) | 30-June-2025 | 31-Dec-2025 |
2019 -20 | 31-Mar-2021 | 31-May- 2024 (Time Barred) | 31-Aug-2024 (Time Barred) | 30-Sep-2025 | 31-Mar-2026 |
2020-21 | 28-Feb-2022 | 30-Nov-2024 (Time Barred) | 28-Feb-2025 (Approaching) | 31-Aug-2026 | 28-Feb-2027 |
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