In this News Letter 2nd Edition of January 2026 you’ll find:
1.RATIO OF LATEST JUDGEMENTS ON GST
2.DUE DATES – GST COMPLIANCES IN FEBRUARY 2026
RATIO OF LATEST JUDGEMENTS ON GST
Aarush Enterprises Vs. The Assistant Commissioner of Central Tax [WRIT PETITION No. 32866 of 2025]
The writ petition was filed by M/s Aarush Enterprises challenging a Show Cause Notice dated 19.09.2025 issued by the Central Tax authorities under Sections 73 and 74 of the CGST/TGST Act for the Financial Year 2021–22, contending that the State Tax authorities had already adjudicated the same transactions and imposed penalty under Section 122 against which an appeal was pending. The petitioner argued that parallel proceedings by Central authorities amounted to overlap as well as were violative of statutory provisions. The High Court had earlier granted interim protection by keeping the impugned Show Cause Notice in abeyance and directed the State Appellate Authority to conclude the pending appeal within a stipulated time.
Considering that the state appeal proceedings had still not concluded, the Hon’ble High Court refrained from giving any final finding on the issue of overlap. It held that the Central Tax authorities may proceed with the show cause notice only after the conclusion of the state appeal proceedings and after considering the petitioner’s reply, relevant legal grounds, findings of the appellate authority and the CBIC Circular dated 06.07.2022. The writ petition was accordingly disposed of with directions to expedite the state appeal, while reserving liberty to the petitioner to challenge any adverse orders in accordance with law.
Riya Construction v. State of U.P. [WRIT TAX No. 3964 of 2025]
In present facts of the case the Hon’ble Allahabad High Court considered the writ petition filed by M/s Riya Construction challenging the adjudication order dated 04.02.2025 passed under Section 73 of the UPGST Act for FY 2020–21 raising a tax demand of ₹1,61,225/-. The petitioner asserted that no show cause notice was ever issued, no opportunity to file reply or personal hearing was granted and even the service of the adjudication order was doubtful. The Court took judicial notice of the recurring nature of such grievances arising due to exclusive online service of notices and orders through the GST portal, often without proper alerts or visibility, resulting in serious violations of principles of natural justice and denial of statutory remedies.
Relying upon consistent views taken by coordinate benches in Mahaveer Trading Company and Shubham Steel Traders, the Court held that the impugned order was vitiated due to procedural lapses and breach of natural justice. Accordingly, the adjudication order was set aside subject to the petitioner depositing ₹16,000/- within one month. The matter was remanded to the Adjudicating Authority with directions to supply the show cause notice and relied upon documents, permit filing of reply and grant a proper hearing after due notice. The writ petition was allowed and disposed of with directions to conclude the remanded proceedings expeditiously.
DGAP Vs. Raja Housing Ltd, GSTAT – DELHI [NAPA/165/PB/2025]
In present facts of the case, the GST Appellate Tribunal considered the appeal filed by the Director General of Anti-Profiteering (DGAP) arising out of a complaint alleging profiteering by M/s Raja Housing Limited in respect of its real estate project “Raja Ritz Avenue Phase-I.” The complaint was that GST was not separately reflected in the receipts issued to a flat purchaser. Upon examination by the Karnataka State Screening Committee and investigation authorities, it was found that although the respondent had opted to continue under the old tax regime at 12% with ITC, it collected GST from buyers only at 5% bearing the differential tax of 7% itself. Verification of sale deeds, vouchers, ledgers, audit reports and GST returns revealed correct declaration of consideration, proper discharge of tax liabilities and no evidence of short payment or tax evasion.
The Tribunal noted that the findings of the State Screening Committee were supported by detailed verification of records and that even subsequent enforcement proceedings did not substantiate any evasion or profiteering. The original complainant failed to raise objections to the committee’s findings. Finding no illegality or irregularity in the investigation or conclusions drawn, the Tribunal held that no profiteering was established against the respondent. Accordingly, the appeal was rejected, the report of the State Screening Committee was confirmed, and the proceedings were ordered to be closed.
Editor’s Note: The Hon’ble Tribunal has confined its approach only towards the profiteering issue by the builder however the issue of depositing extra GST of 7% without authority of law has been ignored which suggests that the builder has not followed the legal provisions in its right spirit. Actually, the builder should have passed on the benefit of GST to the allottee in respect of the residential or commercial unit by reducing the price instead of making extra payment to the extent of 7% of GST to the Government Treasury. The economic effect of the reduced GST has been unfortunately ignored by the GSTAT Delhi.
DGAP Vs. Bhavya Construction Pvt Ltd (Brahmaramba Cinema), Hyderabad [NAPA/44/PB/2025] GSTAT Delhi
In present facts of the case, the GST Appellate Tribunal examined the appeal arising from the DGAP’s report alleging violation of Section 171 of the CGST Act by M/s Bhavya Construction Pvt Ltd for not passing on the benefit of reduction in GST rates on cinema tickets with effect from 01.01.2019. Although GST rates were reduced from 28% to 18% and from 18% to 12%, the respondent continued to charge the same or higher gross ticket prices by increasing the base price, thereby retaining the tax benefit. After detailed scrutiny of pre and post rate reduction pricing, sales data and DGAP’s computation, the Tribunal held that the respondent had profiteered an amount of ₹11,88,482/- during the period 01.01.2019 to 30.06.2019.
The Tribunal rejected the respondent’s defences based on State cinema price regulations, alleged permissions for enhanced pricing, absence of prescribed methodology and exclusion of GST component, holding that none justified non-passing of tax benefits to consumers. It was held that compliance with State laws cannot override the statutory mandate of Section 171, and the profiteered amount includes both excess base price and GST collected thereon. Consequently, the respondent was directed to deposit ₹11,88,482/- equally into the Central and Telangana State Consumer Welfare Funds within 30 days. No interest or penalty was imposed, as the relevant provisions were held to operate prospectively.
Key Business Consultants Private Limited & Anr. vs Union of India & Ors. [WPA 26981 of 2025] – Calcutta High Court
The Hon’ble Calcutta High Court considered a writ petition challenging the appellate order dated 29.07.2025 passed under Section 107 of the CGST/WBGST Act, whereby the petitioner’s appeal against a refund-related order dated 19.02.2020 was dismissed solely on the ground of limitation. The petitioner contended that its earlier appeal had been dismissed during the Covid-19 period despite extensions of limitation granted by the Supreme Court, and that thereafter, pursuant to the CBIC Amnesty Notification dated 02.11.2023, it had validly re-filed the appeal on 03.01.2024 within the extended time allowed up to 31.01.2024.
The Court noted that the CBIC notification expressly permitted assessees whose appeals had been rejected only on limitation grounds to file fresh appeals within the stipulated amnesty period. It held that once the petitioner had availed this statutory benefit, the appellate authority could not again dismiss the appeal on the ground of limitation under Section 107. Since the impugned order ignored the binding CBIC notification and rejected the appeal solely on limitation, the Hon’ble High Court held that the appellate authority failed to apply its mind. Accordingly, the impugned appellate order was set aside and the appeal was restored for fresh consideration on merits, with no order as to costs.
Vedant Road Carriers (P) Ltd. v Assistant Commissioner of West Bengal State Tax [WPA No. 12654 of 2025] – Calcutta HC
The Hon’ble Calcutta High Court examined the legality of an adjudication order dated 17.05.2023 passed under Section 73 of the CGST/WBGST Act and the consequent appellate order dated 25.04.2025 under Section 107, whereby tax liability was confirmed against the petitioner. The show cause notices issued to the petitioner alleged under-declaration of turnover in GSTR-3B. However, the adjudication order ultimately fastened liability on an entirely different basis, namely that the petitioner, a goods transport agency, was liable to pay tax under the Forward Charge Mechanism for supplies allegedly made under Reverse Charge Mechanism, relying upon a GST notification. The petitioner contended that such a finding travelled beyond the scope of the show cause notice and violated Section 75(7) of the CGST Act as well as principles of natural justice.
The Court held that Section 75(7) contains a mandatory prohibition against confirming any demand on grounds other than those specified in the show cause notice. It found that the adjudicating authority had fundamentally altered the basis of the proceedings without issuing a fresh notice or granting an opportunity of hearing, which was impermissible. The Court further observed that the appellate authority, despite acknowledging the statutory violation, erred in treating it as a mere “technical issue.” The Court also accepted the petitioner’s grievance that reliance on undisclosed GST back-office portal data deprived it of an effective opportunity to respond.
Accordingly, the High Court set aside both the adjudication and appellate orders and remanded the matter to the Proper Officer for fresh consideration after furnishing relevant material, granting opportunity of hearing and if necessary issuing a proper additional show cause notice. The writ petition was disposed of with no order as to costs.
Amit Mehra v. Union of India & Ors., (2026) 38 Centax 229 (P&H)
The present petition has been filed seeking regular bail to the petitioners for offences under Section 132(1)(b) of the Central Goods and Services Tax Act, 2017. As per the prosecution case, secret information was received regarding a firm which was availing ITC on the basis of goods-less invoices procured from 4 firms. Consequently, search was conducted in the premises of the alleged firms. During investigation, these firms were found to be non-existent; further, the Directors and employees of the concerned firms revealed that these good-less invoices were procured with the aid of petitioner, who was the proprietor of one of the four non-existent firms, named M/s Kavish Overseas which was providing the good-less invoices to M/s Mefro Organic Limited. Accordingly, a search was conducted. The Hon’ble High Court while dismissing the bail application held that as per the facts and circumstances of the present case as well as the arguments advanced by the Ld. Counsel for the parties, the present petitioner accused is alleged to have set-up as many as 44 non-existent / proxy firms, thereby causing great loss to the public exchequer running into hundreds of crores rupees by passing on the benefit of fake Input Tax Credits through goods-less invoices. The allegations against the petitioner were serious, and the alleged amount involved so far as per the investigation is huge i.e. Rs. 315.3 crores.
The Hon’ble High Court while taking into consideration the huge amount involved, and on account of the present case being one dealing with economic offence, which constitute a class apart from ordinary offences, invites far more stringent view while granting the concession of bail. Consequently, the bail application was dismissed.
DUE DATES – GST COMPLIANCES IN FEBRUARY 2026 | |||
Monthly | Quarterly | Other Due Dates | |
GSTR-3B (Jan, 2026) Feb 20th, 2026 | GSTR-3B (Jan-Mar, 2026) Apr 22nd, 24th, 2026 | GSTR-5 (Jan, 2026) Feb 13th, 2026 | GSTR-5A (Jan, 2026) Feb 20th, 2026 |
GSTR-1 (Jan, 2026) Feb 11th, 2026
| GSTR-1 (Jan-Mar, 2026) Apr 13th, 2026 | GSTR-6 (Jan, 2026) Feb 13th, 2026
| GSTR-7 (Jan, 2026) Feb 10th, 2026 |
IFF (Optional) (Jan,2026) Feb 13th, 2026 | CMP-08 (Jan-Mar, 2026) Apr 18th, 2026 | GSTR-8 (Jan, 2026) Feb 10th, 2026 | RFD-10 2 years from the last day of the quarter in which supply was received |
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