GST Daily Updates
23 September 2026
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GST Laws
High Courts
1. Ozone Pharmaceutical Ltd. v. Union of India and Ors. – (2026) taxcode.in 1502 HC
Refund already finalised cannot be appropriated without fresh adjudication of recoverable liability and hearing
The Court held that the petitioner’s refund entitlement of Rs. 88,54,980/- had already attained finality after the CESTAT order and could not be reopened. However, the authority could not appropriate that sanctioned refund against an alleged liability, especially the interest component, without an independent determination made in accordance with law and after notice and hearing. The undertaking furnished pursuant to the Supreme Court’s interim order did not dispense with those safeguards. The Court therefore upheld the sanction of refund but set aside the adjustment and directed the department to determine any recoverable amount afresh before taking further action.
2. Ramesh Chand v. Sales Tax Officer Chromepet Circle – (2026) taxcode.in 1525 HC
Retrospective Section 16 amendment extends ITC benefit despite earlier limitation-based rejection under GST assessment
The Court quashed the assessment to the extent it denied input tax credit as time-barred under Section 16(4), holding that the issue was covered by an earlier decision extending the benefit of the retrospective amendment to Section 16. Since the claim fell within the enlarged period under Section 16(5), the impugned order could not survive on limitation grounds. The Department was restrained from continuing recovery on that basis, and any amount already recovered was directed to be refunded or adjusted against future tax. The Court thus applied the amended statutory position to grant relief to the dealer.
3. Prayank Gupta v. Union of India and Anr. – (2026) taxcode.in 1523 HC
Anticipatory bail in GST matter held premature absent communicated arrest order under Section 69
The Court dismissed the anticipatory bail petitions as premature, holding that summons under Section 70 of the CGST Act by itself did not create a legally sustainable apprehension of arrest. Relying on Supreme Court precedent, it ruled that an order under Section 69 authorising arrest, and its communication to the person concerned, is the sine qua non for maintaining such a petition. Since no Section 69 order had been passed or served, the petitioners could not seek pre-arrest protection merely because investigation was ongoing. The Court left all merits and liberty issues open for a later stage if a proper arrest order was issued.
4. Neelkanth Entrepreneurs Pvt. Ltd. v. State of U.P. and Anr. – (2026) taxcode.in 1537 HC
Show-cause notice under Section 74A survives without Section 61 scrutiny when based on independent verification
The Court dismissed the writ petition against the Section 74A show-cause notice, holding that scrutiny under Section 61 was not a mandatory precondition where the department acted on independent verification alleging bogus sub-contractors and ineligible input tax credit. It found that Rule 99 applies only when scrutiny of returns has actually been undertaken, which was not the case here. The notice also disclosed sufficient foundational facts for invoking Section 74A(5)(ii), and the petitioner’s objections raised disputed facts better left to adjudication. The Court declined to interfere at the notice stage and granted liberty to file a reply before the authority.
5. Bharat Luxindo Agrifeeds Pvt. Ltd. v. Additional Commissioner Of Customs (Gr.IB) – (2026) taxcode.in 1554 HC
Extended customs limitation under Section 28(4) cannot rest on mere change in view about classification
The Court set aside the customs order, holding that the ingredients for invoking the extended limitation under Section 28(4) were not established. The importer had disclosed the goods as Rice Bran, stated the classification in the Bill of Entry, and claimed the notification benefit openly; the document had been accepted by the proper officer. A later departmental disagreement on classification or exemption could not, by itself, establish collusion, wilful misstatement, or suppression of facts. The Court also held that the existence of an appellate remedy did not bar writ jurisdiction where assumption of jurisdiction under Section 28(4) itself was under challenge.
6. N.D. Jewellers v. Principal Commissioner of Customs and Ors. – (2026) taxcode.in 1556 HC
Bank account attachment cannot continue beyond statutory maximum period despite pending customs adjudication
The Court directed defreezing of the petitioner’s bank account, holding that provisional attachment under Section 110(5) of the Customs Act cannot continue beyond the statutory maximum of twelve months. It rejected the department’s argument that a later show-cause notice under Section 124 or the pendency of adjudication could extend the freezing period. The Court treated the attachment as having ceased by efflux of time and ordered immediate operation of the account. It clarified that the department remained free to take any other action permissible in law, but not to continue the expired attachment.
7. Khodal Infra Buildsquare LLP v. Kamal Singh Meena and Ors. – (2026) taxcode.in 1569 HC
Second registration cancellation notice on identical grounds was invalid after earlier proceedings had been dropped
The Court quashed the second show-cause notice and cancellation order, holding that they were based on the same allegations and material as an earlier notice whose proceedings had already been dropped. It also found that the cancellation order went beyond the notice by relying on alleged fraudulent availment and passing of ineligible ITC, a case the petitioner had never been called upon to answer. On those facts, the Court held that the impugned action suffered from non-application of mind. The respondents were left free to issue a fresh notice and proceed in accordance with law after giving proper hearing.
Goods and Services Tax Appellate Tribunal (GSTAT)
8. Partha Tribedi v. Vivek Ranjan Assistant Commissioner – (2026) taxcode.in 174 GSTAT
Tax demand under Section 74 fails where no statutory show-cause notice was served before adjudication
The Tribunal allowed the appeal and set aside the appellate order, holding that issuance of a statutory show-cause notice under Section 74(1) was a mandatory prerequisite for determining tax, interest and penalty under Section 74(9). It found it undisputed that no such notice had been served, and therefore the assessee had been denied a meaningful opportunity to know and meet the case against him. The Tribunal held that DRC forms, summons, or other communications could not substitute for the statutory notice required by the Act and Rules. On that basis, the entire proceedings were treated as vitiated.
