01/07/2025
Summary of Major Judgements of Court on GST during June 2025:
1. Sikkim High Court: Refund of ITC on Business Closure
Case Name: SICPA India Pvt Ltd v. Union of India
Ruling: The court ruled that Input Tax Credit (ITC) refunds are permissible upon business closure, as tax authorities cannot retain tax without legal authority. This ensures businesses can recover unutilized ITC when ceasing operations.
Impact: Clarifies refund eligibility for businesses winding up, preventing unjust enrichment by the government. Significant for companies restructuring or closing.
2. Allahabad High Court: GST Order Quashed for Lack of Fixed Date
Case Name: M/s Shiv Trading v. State of U.P.
Ruling: The court quashed a GST order for not adhering to a fixed judgment date, violating procedural fairness. The case was remanded for a fresh decision.
Impact: Reinforces procedural compliance in GST adjudication, ensuring fair hearings for taxpayers and potentially stricter timeline adherence by authorities.
3. Allahabad High Court: Stay on Order Exceeding SCN Scope
Case Name: M/s S.K. Enterprises v. Commissioner, CGST
Ruling: The court stayed a GST demand order that increased CGST and SGST beyond the Show Cause Notice (SCN) scope, excluding IGST. The order was deemed procedurally flawed for deviating from the SCN.
Impact: Protects taxpayers from arbitrary tax liability increases, emphasizing that authorities must adhere to the SCN’s scope, reducing assessment overreach.
4. Kerala High Court: Unified ITC Ledger
Ruling: The court ruled that the ITC ledger is a unified pool, not segmented into CGST, SGST, or IGST, allowing flexible use of ITC across tax heads for set-off.
Impact: Simplifies ITC utilization, reducing compliance disputes, especially for businesses with inter-state transactions.
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