GST Weekly Flashback: 29 December 2024 To 4 January 2025

Date:

The GST Weekly Flashback for the period 29 December 2024 to 4 January 2024.

Supreme Court

GST Dilemma After Supreme Court Classifies ‘Mortgagor’ As ‘Guarantor’

Case Title: China Development Bank versus Doha Bank Q.P.S.C. & Ors.

The Supreme Court has classified ‘Mortgagor’ as ‘Guarantor’.

The bench of Justice Abhay S Oka and Justice Pankaj Mithal has observed that if after the sale of hypothecated assets, there is any shortfall in the discharge of the liabilities of the Corporate Debtor is under an obligation to pay the shortfall or deficiency. Therefore, the Corporate Debtor, who is not the borrower, agreed to discharge the liability of the third parties in the case of default. Therefore, it amounts to a guarantee provided by the Corporate Debtor to the appellants in terms of Section 126 of the Contract Act.

Madras High Court

GST Order Demanding  Rs.6.57 Crores From Gillette: Madras High Court Grants Last Chance To File Reply Subject To Payment Of Rs. 1 Crore

Case Title:  Gillette India Limited Versus Assistant Commissioner

The Madras High Court has allowed Gillette to file a reply to GST demand subject to payment of Rs. 1 Crore.

The bench of Justice Mohammed Shaffiq has provided with one final opportunity to the petitioner, Gillette, to put forth their objections subject to the  payment of 10% of disputed taxes of Rs.6,56,80,225 as proposed in the show cause notice.

Excess Amount Paid In One Case Settled Under SVLDRS, Can Be Adjusted In Another Case : Madras High Court

Case Title: The Designated Committee under Sabka Vishwas Legacy Dispute Resolution Scheme, 2019 Versus M/s.Navin Housing and Properties (P) Limited

The Madras High Court has held that the amount excess paid in one case settled under Sabka Vishwas – (Legacy Dispute Resolution) Scheme, 2019 (SVLDRS), can be adjusted against the amount payable under SVLDRS in another case, when the demands are duplicated.

The bench of Justice R.Suresh Kumar and Justice C.Saravanan has observed that the amount that was paid prior to passing of the Order was eligible for being set off against the tax liability of the respondent under the Scheme for the period under dispute covered by the 2nd demand in Show Cause Notice as confirmed by the Order as there was an excess amount of Rs.15,18,561/- paid by the petitioner against demand comprised in Order.

Madras High Court Directs Dept. To Allow Re-Credit Amount Paid On RCM Basis Belatedly On 30.12.2017 As ITC In Electronic Credit Ledger

Case Title: M/s.SRC Projects Private Limited Versus The Assistant Commissioner of GST and and Central Excise

The Madras High Court has directed the to allow the petitioner to take recredit of the amount paid by the petitioner on reverse charge basis belatedly on 30.12.2017 as the Input Tax Credit in its Electronic Credit Ledger.

The bench of Justice C.Saravanan has observed that the Petitioner paid Service Tax for the period 2016-17, which was payable under RCM, on 30.12.2017.  But, due to introduction of GST, they cannot avail Cenvat Credit of the same and hence they claimed refund, which was rejected.

Kerala High Court

Electronic Credit Ledger Is A Wallet, Availment Of ITC Benefit Doesn’t Amount To Be Wrongful : Kerala High Court

Case Title: Star Roofs And Metals Versus The Assistant Commissioner

The Kerala High Court has held that the electronic credit ledger is a wallet, availment of Input Tax Credit (ITC) benefit does not amount to be wrongful.

The bench of Justice Bechu Kurian Thomas relied on the decision in the case of Rejimon Padickapparambil Alex v. Union of India and Others in which it was observed that the electronic credit ledger is in the nature of a wallet with different compartments of Integrated Goods and Services Tax, Central Goods and Services Tax and State Goods and Services Tax and there cannot be any wrong availment of input tax credit merely because a taxpayer had availed the benefit of credit of input tax available in IGST under the heads CGST and SGST.

Karnataka High Court 

Act Of Dept. In Suspending GST Registration Pending Enquiry Is Too Harsh : Karnataka High Court 

Case Title: M/S. Haradiya Enterprises Versus Superintendent Of Central Tax

The Karnataka High Court has held that the act of the department in suspending the GST registration of the petitioner pending enquiry is too harsh.

Calcutta High Court 

No Relief To Britannia Against DGGI Recovery SCN Worth Rs. 105 Crores: Calcutta High Court Dismisses Petition Citing Alternative Remedy

Case Title: M/s. Britannia Industries Limited -Vs- Union of India & Ors.

The Calcutta High Court has dismissed the writ petition filed by Britannia against the show cause notice (SCN) issued by the Directorate General of GST Intelligence (DGGI) asking why the recovery worth Rs. 105 crores should not be made, citing alternative remedy.

The bench of Justice Rajarshi Bharadwaj has observed that writ courts do not interfere in cases where statutory remedies are available unless there is a clear violation of fundamental rights, lack of jurisdiction, or procedural perversity leading to manifest injustice. The petitioner has not demonstrated any such exceptional circumstances warranting this Court’s intervention. 

Gujarat High Court

No GST On Transfer Of Leasehold Rights : Gujarat High Court

Case Title: Suyog Dye Chemie Pvt Ltd Versus UOI

The Gujarat High Court while quashing the show cause notice and the order has held that no Goods and Service Tax is payable on the  transfer of leasehold rights since it would be transfer of immovable property and therefore question of Input Tax Credit (ITC) would not arise.

Amit Sharma
Amit Sharma
Amit Sharma is the Content Editor at JurisHour. He has been writing about the Indian legal market. He has covered tax & company litigation stories from the Supreme Court, High Courts and Various Tribunals. Amit graduated from MLSU Law College with B.A.LL.B. and also holds an LL.M. from MLSU, Udaipur, Rajasthan. An Advocate in Taxation, and practised in Tribunals as well as Rajasthan High Court and pursued Masters in Constitutional Law. He started out small with little resources but a big plan to take tax legal education to the remotest locations across India and eventually to the world. His vision is to make tax related legal developments accessible to the masses.

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