Indirect Tax Amicus, August 2026

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Goods and Services Tax (GST)

Ratio decidendi

·         Refund of IGST on exports – Omission of Rule 96(10) of CGST Rules is applicable to pending proceedings – Supreme Court

·         ITC on Telecommunication towers is not deniable under Section 17(5)(d), towers being not immovable property – Supreme Court

·         Supply of wind turbine generators and installation services is composite supply and is not works contract involving immovable property – Supreme Court

·         Arrest – Order under Section 69 needs to be communicated to the person before arrest – Supreme Court

·         Demand – Extended period cannot be invoked by mechanical use of words ‘fraud, willful misstatement or suppression of facts’ – Supreme Court

·         Demand – Extended period cannot be invoked by mere lip service to provisions – Supreme Court

·         Demand – Extended period – SCN need not detail fraud, suppression, etc., if reasons earlier communicated – Madras High Court

·         Demand – Issuance of notice – Threshold under GST is less as compared to that under other indirect tax regimes – Madras High Court

·         Corporate guarantee by a holding company to its subsidiary, even if without consideration, is liable to GST – Gujarat High Court

·         Corporate guarantee – Rule 28(2) – Expression ‘whichever is higher’ read down and levy on guarantee furnished before 26 October 2023 found to violate Articles 14 and 19(1)(g) – Gujarat High Court

·         Refund cannot be withheld without passing order under Section 54(11) – Patna High Court

·         ITC refund – Cancellation of GST registration of second line of suppliers is not material – GSTAT Kolkata

·         E-way Bill – Absence of, when fatal and when mere procedural lapse – Intention to evade is the key – GSTAT Lucknow

·         Amnesty Scheme is not available if excess ITC reported in December 2020; assessee’s submission that ITC pertained to period 2018-19 rejected – GSTAT Bengaluru

·         Recovery notice issued on date when assessee was not aware of adjudication order, is not sustainable – Participation in adjudication proceedings is not material – Karnataka High Court

·         Refund of partial pre-deposit is available if part of demand is set aside in Order-in-Appeal – Bombay High Court

·         Mere declaration of nil returns is not discontinuation of business for cancellation of registration – Gujarat High Court

·         SCN/Order not bearing signature is not valid – Presence of reference number is not material – Rajasthan High Court

·         Amnesty scheme under Section 128A – No implied exclusion of ‘self-assessed tax’ – Madras High Court

·         Amnesty scheme – Time limits specified in Rule 164 are mandatory and not directory – Madras High Court

·         Search and seizure – Premises cannot be kept sealed under Section 67(4) after search – Gauhati High Court

·         Prohibition Order on office equipment is not sustainable – Can be passed only in case of goods liable to confiscation – Gauhati High Court

·         Demand – Extended period – Merely taking ineligible self-assessed ITC in Electronic Credit Ledger and mere failure to reply to audit enquiry, are not suppression – GSTAT Thiruvananthapuram

Customs and FTP

Notifications and Circulars

·         Realisation of export proceeds in Indian Rupees – FTP aligned with Foreign Exchange Management (Manner of Receipt and Payment) Regulations, 2023

·         Personal postal imports – SOP for customs clearance through Foreign Post Offices issued

·         E-commerce – Inventory-based cross-border e-commerce export framework introduced

·         Raw sugar – Nil BCD till 31 October 2026 for import of 10 lakh MT under TRQ

·         Television Sets – Mandatory compliance date for IS 18112:2022 extended till 26 January 2027

·         Wheat, durum wheat, wheat flour and related products – Export policy revised to ‘Free’

Ratio decidendi

·         Port Trust liable to Customs duty for goods pilfered while in its custody – Supreme Court upholds Customs notification designating Port Trust as custodian

·         Re-import – Movement of goods to DTA again against a fresh Essentiality Certificate is new import and not re-import – Delhi High Court

·         Amendment to shipping bill when cannot be denied – CESTAT Hyderabad

·         FTA imports – Certificates of Origin subsequently found to be not authentic – Extended period when not invocable – CESTAT Ahmedabad

·         Valuation of exports – Test result by itself cannot substitute transaction value with a hypothetical value – CESTAT Hyderabad

Central Excise, Service Tax and VAT

Ratio decidendi

·         Penalty under Section 78 of Finance Act, 1994 can be set aside if tax liability satisfied before SCN – Supreme Court

·         Service tax appeal – Pre-deposit made by utilizing Cenvat credit transitioned to GST and reflected in ECL, is correct – Karnataka High Court

·         Reimbursement of operating costs of employees by Group companies is not covered under BSS – CESTAT Prayagraj

·         Works Contract service – Composition scheme – Later revision in percentage is not material – CESTAT Larger Bench

·         Outdoor Catering service – Exemption for ‘substantial and satisfying meal’ under Notification No. 20/2004-S.T. available even in case of supply of tea, coffee, sandwiches and like goods – CESTAT Chennai