3SC Matters
6HC Orders
9GST Updates
3Customs/DGFT
12Compliance Dates
6Income Tax Items
🔑 Top 3 Takeaways This Week
- Allahabad HC (Samarpan Jain): An advocate filing a statutory appeal and advising ITC-based pre-deposit cannot be named in a criminal conspiracy FIR. Professional acts — even if legally wrong — do not make an advocate a conspirator. Landmark protection for the Bar.
- Supreme Court (Prime Metals): SC takes up constitutional challenge to Section 16(2)(c) — ITC cannot be denied to a bona fide recipient for default of a supplier one step removed in the chain. Authoritative ruling pending; conflicting HC positions resolved.
- Supreme Court (Aerocom Cushions): SC dismisses Revenue's SLP — confirms NO GST on assignment of leasehold rights in MIDC/GIDC industrial land. Watershed ruling for all industrial units holding leasehold plots.
GST — Important Judgments & Rulings
9 landmark decisions this week from Supreme Court and various High Courts — with full facts, issues, holdings and practical guidance
Samarpan Jain v. State of U.P. | Crl. Misc. WP No. 23443/2025 | May 21, 2026
Advocate filed Section 107 CGST appeal for client and advised 10% pre-deposit via Electronic Credit Ledger. GST Department lodged FIR for criminal conspiracy. Allahabad HC quashed the FIR, charge-sheet and cognizance order entirely.
The Advocate
Samarpan Jain — enrolled with Bar Council of UP since December 20, 2021. Specialises in indirect taxes, direct taxes and corporate laws. Advocate-on-Record before Allahabad HC.
The Client
M/s M H Enterprises (GSTIN: 09AJDPH7962C3Z5), Rampur, proprietor Mohd. Haris — faced Section 74 assessment orders for FY 2021-22, 2022-23 and 2023-24 aggregating to crores of rupees.
Professional Act
On August 15, 2025, Advocate filed two online statutory appeals before Appellate Authority-3 and paid 10% pre-deposit by debiting the client's Electronic Credit Ledger (ITC). Authority: CBIC Circular CBIC-20001/2/2022-GST dated July 6, 2022 + Supreme Court in Union of India v. Yasho Industries [2025 SCC OnLine SC 1526].
The Problem
Appellate Authority rejected the appeal (September 23, 2025) saying ITC-based pre-deposit not valid. Instead of recovering dues from the client, the Deputy Commissioner of GST Rampur lodged FIR No. 175/2025 naming the Advocate also, under Sections 61(2), 318(4), 336(3), 338 and 340(2) of the Bharatiya Nyaya Sanhita, 2023.
Apr 16, 2025
Section 74 orders passed against M/s M H Enterprises for FY 21-22, 22-23, 23-24
Aug 15, 2025
Advocate files two appeals under Section 107; pre-deposit made via ECL using ITC
Sep 23, 2025
Appellate Authority says ITC pre-deposit not acceptable; calls for clarification on maintainability
Oct 4, 2025
Deputy Commissioner lodges FIR No. 175/2025 naming both client AND advocate
May 14, 2026
Charge-sheet filed + cognizance taken by ACJM — all on same day after writ notice
May 21, 2026
Allahabad HC quashes FIR, charge-sheet and cognizance order as against the Advocate
Core Legal Question
Whether an Advocate can be arraigned as an accused in criminal conspiracy with his client merely for performing a professional act — filing a statutory appeal under Section 107 CGST Act and tendering mandatory pre-deposit via ECL using ITC — when done in professional capacity based on prevailing CBIC Circular and judicial precedent?
Advocate's Contentions
• Filed appeal in professional capacity, going by applicable laws as declared by Superior Courts and binding CBIC Circular
• No evidence showing personal involvement in client's business
• Even if legal position was wrong, it was a professional decision on a view of law — not criminal conspiracy
• Prosecution strikes at root of right to legal representation under Articles 14 and 21
• No evidence showing personal involvement in client's business
• Even if legal position was wrong, it was a professional decision on a view of law — not criminal conspiracy
• Prosecution strikes at root of right to legal representation under Articles 14 and 21
Legal Background
CBIC Circular No. CBIC-20001/2/2022-GST (July 6, 2022) expressly permits ITC-based pre-deposit. Gujarat HC in Yasho Industries — ITC pre-deposit valid — affirmed by SC in Union of India v. Yasho Industries [2025 SCC OnLine SC 1526]. The Department criminalised an act explicitly authorised by its own Board's circular.
1
The FIR, charge-sheet and cognizance order "violate all known principles of criminal liability." An Advocate is authorised and duty-bound to represent his client even in the gravest offences.
2
If an Advocate is held in conspiracy for preferring an appeal, "it would be the end of the very existence of the Bar and the right of an Advocate to practice under the Advocates Act" — every lawyer would first think of his own defence before filing a vakalatnama.
3
"The professional decision of the learned Advocate, to do so, does not, in any way, make him a conspirator with the assessee. It is purely a professional act... done in the course of filing an appeal and nothing more. It was based on a particular view of the law, whether right, wrong or utterly wrong."
4
Quashed: FIR dated October 4, 2025 (Crime No. 175/2025) + Charge-sheet No. 30/2026 + Cognizance order dated May 14, 2026 — in so far as they relate to the Advocate.
5
Directed Chief Judicial Magistrate, Rampur to enter the quashing in red ink in General Diary. Copy to SP Rampur, SHO Kotwali, and DGST Deputy Commissioner, Rampur.
6
Criminalising an advocate for a professional act hits Articles 14 and 21 — "The Advocate has to work fearlessly and discharge his professional duties, just as an officer of the State."
📋 For GST Advocates & Tax Practitioners
This judgment insulates advocates from criminalisation for bona fide professional acts. However, the protection ends where personal involvement in the client's illegality begins. Three-pronged test from the combined reading of Samarpan Jain, Puneet Batra (Delhi HC) and Maulikkumar Sheth (Gujarat HC):
1. No FIR/prosecution unless cogent material showing personal involvement beyond professional engagement
2. No search of advocate's CPU/device without physical presence and informed consent
3. Seized digital data must be bifurcated — non-incriminating (client) data permanently sealed
1. No FIR/prosecution unless cogent material showing personal involvement beyond professional engagement
2. No search of advocate's CPU/device without physical presence and informed consent
3. Seized digital data must be bifurcated — non-incriminating (client) data permanently sealed
What GST Authorities Must Follow
• Recorded "reasons to believe" under Section 67(1) before any search of advocate's premises
• Forensic examination only under court-supervised protocol with neutral experts
• No coercive action for professional decisions (relying on CBIC circular, invoking HC ruling, making procedural choices in appeals)
• Must use GST-specific recovery/prosecution provisions (Sections 79, 132, 138) — NOT BNS criminal conspiracy charges
• CBIC should issue Instruction analogous to CBDT Instruction No. 7/2003 for GST professionals
• Forensic examination only under court-supervised protocol with neutral experts
• No coercive action for professional decisions (relying on CBIC circular, invoking HC ruling, making procedural choices in appeals)
• Must use GST-specific recovery/prosecution provisions (Sections 79, 132, 138) — NOT BNS criminal conspiracy charges
• CBIC should issue Instruction analogous to CBDT Instruction No. 7/2003 for GST professionals
⚠️ Section 107(6) — Pre-Deposit Rules Clarified
Section 107 CGST Act confers right of appeal subject to: (a) Full admitted tax + (b) 10% of remaining disputed tax (capped at ₹20 crore under CGST + ₹20 crore under SGST). CBIC Circular dated July 6, 2022 permits ITC-based payment — confirmed by SC in Yasho Industries [2025 SCC OnLine SC 1526]. The Appellate Authority's rejection of ITC pre-deposit as "not valid" does not make the Advocate's advice criminal — it is at best an erroneous professional position.
🧠 Quick Check: Under what law did the Allahabad HC find that the impugned FIR violated rights?
From the combined reading of Samarpan Jain (Allahabad HC), Puneet Batra (Delhi HC) and Maulikkumar Satishbhai Sheth (Gujarat HC) — Standard Operating Safeguards for GST authorities dealing with advocates:
- Prima Facie Material Threshold: No search, summon, FIR or arraignment of an advocate is permissible unless the Department possesses cogent prima facie material demonstrating that the advocate is personally involved in the alleged illegality — going beyond his professional engagement as counsel.
- Section 67 "Reasons to Believe": Any search of an advocate's premises must be preceded by recorded "reasons to believe" within the meaning of Section 67(1) CGST Act, capable of judicial scrutiny.
- Mandatory Presence During Device Seizure: CPU/electronic devices of an advocate must not be opened, accessed or downloaded without physical presence and informed consent — owing to attorney-client privilege covering third-party client data.
- Forensic Protocol with Judicial Oversight: Court-supervised protocol with neutral IT/forensic experts, hard drive cloning, supply of cloned copy to advocate, and data sharing strictly limited to files of the specific client under investigation.
- No Coercive Action for Professional Acts: Adopting a particular legal interpretation, relying on a Board circular, invoking a HC ruling, making tactical procedural choices in filing appeals — cannot expose an advocate to penal consequences under BNS, CGST Act or allied statutes, even if the legal view is ultimately wrong.
- Bifurcation of Seized Data (Maulikkumar Sheth Protocol): Seized digital data bifurcated into incriminating (qua advocate) and non-incriminating (qua third parties/clients). Non-incriminating data permanently sealed and never accessed by Department. Third parties can independently raise attorney-client privilege under Sections 126 and 129 of Indian Evidence Act, 1872.
- CBDT-Style Guidelines Needed: CBDT Instruction No. 7/2003 says "taxpayers who are professionals of excellence need not be searched without compelling evidence and confirmation of substantial tax evasion." CBIC should adopt an analogous instruction for GST search/summon proceedings against legal professionals.
M/s Prime Metals v. CBIC — SLP (C) No. 18577/2026 — May 22, 2026
Petitioner's immediate supplier paid tax; only the supplier one step removed was allegedly fake. SC admits SLP, records submissions, and lists for hearing on May 29, 2026. Prima facie observation: supplier-side default at a stage one removed "cannot operate to the prejudice of the assessee."
The Petitioner
M/s Prime Metals — registered under CGST/RGST Act 2017 — manufacturing unit at Matsya Industrial Area, Alwar, Rajasthan. Availed ITC on inward supplies from its suppliers.
The Demand
SCN dated June 25, 2025 → Order-in-Original dated December 17, 2025 confirming ITC denial. Allegation: immediate/preceding supplier DID pay tax, but the supplier one step further removed in the chain either did not pay or was a fake entity.
High Court
Rajasthan HC (April 29, 2026) dismissed writ petition on alternative remedy grounds — did not adjudicate the constitutional challenge to Section 16(2)(c). Granted liberty to raise all grounds before Appellate Authority. But Appellate Authority under Section 107 CANNOT examine constitutional validity of a section.
SC Observations
SC prima facie noted the HC erred in relegating petitioner to appellate remedy when constitutional validity was specifically put in issue. SC recorded that supplier default "one removed" from the chain "cannot operate to the prejudice of the assessee." Listed for May 29, 2026.
What Section 16(2) Requires — Cumulative Conditions for ITC
(a) Possession of a tax invoice or debit note
(aa) Supplier has furnished details in GSTR-1 under Section 37
(b) Actual receipt of goods or services
(ba) ITC communicated under Section 38 not restricted
(c) The tax charged in respect of such supply has been ACTUALLY PAID to the Government, either in cash or through utilisation of admissible ITC ← THE CONTESTED CONDITION
(d) Furnishing of return under Section 39
(aa) Supplier has furnished details in GSTR-1 under Section 37
(b) Actual receipt of goods or services
(ba) ITC communicated under Section 38 not restricted
(c) The tax charged in respect of such supply has been ACTUALLY PAID to the Government, either in cash or through utilisation of admissible ITC ← THE CONTESTED CONDITION
(d) Furnishing of return under Section 39
⚠️ Why Clause (c) Is Problematic
The recipient CAN control: possession of invoice, receipt of goods, payment of consideration with tax to supplier, its own return compliance. But whether the supplier ultimately discharges tax to the Government — through cash or through its own admissible ITC — is wholly outside the recipient's control. Section 16(2)(c) makes ITC eligibility dependent on an act the recipient cannot perform or ensure = legally impossible act under lex non cogit ad impossibilia.
Pro-Taxpayer Line (Reads Down Section 16(2)(c))
• Tripura HC — Sahil Enterprises (Jan 6, 2026): reads down for bona fide recipients
• Gauhati HC — National Plasto Moulding (2024): reads down Section 16(2)(c) for bona fide purchasers
• Karnataka HC — Instakart Services (Feb 9, 2026): reads down Section 16(2)(c) and Rule 36(4) to save bona fide recipients
• Allahabad HC — R.T. Infotech (Dec 2024): purchaser cannot be left at mercy of non-filing seller
• Delhi HC — On Quest Merchandising: purchasing dealer who takes all steps cannot be expected to track seller's deposit — SLP dismissed by SC
• Gauhati HC — National Plasto Moulding (2024): reads down Section 16(2)(c) for bona fide purchasers
• Karnataka HC — Instakart Services (Feb 9, 2026): reads down Section 16(2)(c) and Rule 36(4) to save bona fide recipients
• Allahabad HC — R.T. Infotech (Dec 2024): purchaser cannot be left at mercy of non-filing seller
• Delhi HC — On Quest Merchandising: purchasing dealer who takes all steps cannot be expected to track seller's deposit — SLP dismissed by SC
Pro-Revenue Line (Upholds Strict Literal Reading)
• Gujarat HC — Maruti Enterprise (May 1, 2026): upholds Section 16(2)(c) constitutionality; actual supplier payment = intrinsic statutory condition
• AP HC — Thirumalakonda Plywoods (July 2023)
• Patna HC — Aastha Enterprises (Aug 2023): payment to supplier is private contractual act ≠ payment to exchequer
• Kerala HC — Nahasshukoor; M. Trade Links (June 2024)
• MP HC — Shree Krishna Chemicals (2025)
• Madras HC — Baby Marine Eastern Exports (2025)
• SC (indirectly) — Ecom Gill Coffee (2023): burden lies on dealer to establish actual movement and receipt
• AP HC — Thirumalakonda Plywoods (July 2023)
• Patna HC — Aastha Enterprises (Aug 2023): payment to supplier is private contractual act ≠ payment to exchequer
• Kerala HC — Nahasshukoor; M. Trade Links (June 2024)
• MP HC — Shree Krishna Chemicals (2025)
• Madras HC — Baby Marine Eastern Exports (2025)
• SC (indirectly) — Ecom Gill Coffee (2023): burden lies on dealer to establish actual movement and receipt
📌 Taxpayer Advisory Until SC's Definitive Ruling
Preserve this documentary trail:
✔ Valid tax invoices containing supplier GSTIN
✔ E-way bills and lorry receipts
✔ Delivery challans and weighment slips
✔ Stock registers and consumption records
✔ Bank proof: payment of value plus GST amount
✔ Downloaded copies of GSTR-2A/2B at the relevant time
✔ Supplier registration screenshots
✔ Contractual indemnities from suppliers
When notices are issued: Insist the Department FIRST proceed against the defaulting supplier and demonstrate recovery from supplier has been duly attempted before fastening liability on the recipient.
✔ Valid tax invoices containing supplier GSTIN
✔ E-way bills and lorry receipts
✔ Delivery challans and weighment slips
✔ Stock registers and consumption records
✔ Bank proof: payment of value plus GST amount
✔ Downloaded copies of GSTR-2A/2B at the relevant time
✔ Supplier registration screenshots
✔ Contractual indemnities from suppliers
When notices are issued: Insist the Department FIRST proceed against the defaulting supplier and demonstrate recovery from supplier has been duly attempted before fastening liability on the recipient.
M/s Murliwala Pigment v. Union of India | SLP (C) No. 17943/2026 | May 21, 2026
DGGI conducted search at 5 premises, seized goods, sealed 4 premises, and attached bank accounts via DRC-22 — all before issuing any Show Cause Notice. SC prima facie holds Section 67(4) does not apply (no denial of access); bank attachment without SCN raises serious concerns.
What Happened
March 10, 2026: DGGI Jaipur Unit searches 5 premises simultaneously under Section 67(2). Goods seized; 4 premises sealed. March 12, 2026 (DRC-22): bank accounts provisionally attached under Section 83. Summons issued March 14 and March 18. Written replies filed but no personal appearance. No SCN issued till date of SC hearing.
Exact Scope of Section 67(4)
"The officer authorised under sub-section (2) shall have the power to seal or break open the door of any premises... where access to such premises, almirah, electronic devices, box or receptacle is denied." — Sealing power exists ONLY when access is denied. In Murliwala's case, access was freely granted — Section 67(4) simply did not apply.
Section 83 — Legal Standard
Per Radha Krishan Industries v. State of HP [(2021) 6 SCC 771]: Power of provisional attachment is "draconian in nature." Commissioner must form opinion based on TANGIBLE MATERIAL indicating REAL RISK to Government revenue — not mere suspicion or routine practice. Attachment before even issuing an SCN = serious legal question.
Important Caution for Taxpayers
HC noted the taxpayer had NOT personally appeared in response to summons — only written replies were filed. SC in Armour Security [2025 INSC 982] held that "initiation of any proceedings" for Section 83 means formal adjudication proceedings (via SCN) — not search/seizure/summons. Taxpayers MUST personally appear when summoned under Section 70.
Asst. Commr. (Anti Evasion) v. Aerocom Cushions Pvt. Ltd. | SLP (Civil) Diary No. 26041/2026 | May 22, 2026
A cushion manufacturer assigned its 95-year MIDC leasehold plot (including factory building) to a third party for ₹1.5 crore. Revenue demanded 18% GST (₹27 lakh). SC dismisses Revenue's SLP: assignment of leasehold rights = transfer of immovable property benefits = NOT a supply. Not in course of business.
The Transaction
Aerocom Cushions Pvt. Ltd. was allotted Plot No. F-14/2, MIDC Hingna Road, Nagpur on 95-year lease. Assigned entire leasehold rights + factory building to M/s Rishita Industries for ₹1,50,00,000 with MIDC's prior consent under Clause 2(u) of lease deed. Also paid ₹3,95,640 additional premium to MIDC.
Revenue's Demand
SCN No. 47/AC/GST/NGP-I/2024 dated December 20, 2024 under Section 74(1) — alleged assignment = "supply of services" under Section 7(1) read with Schedule II Clause 2(b) = "other miscellaneous services" under SAC 9997 at 18% = GST demand of ₹27,00,000.
Bombay HC (Jan 9, 2026)
Allowed writ petition; quashed SCN. Followed Gujarat HC in GCCI (R/SCA No. 11345/2023). Held: assignment of leasehold rights in immovable property ≠ supply of service under CGST Act. Also held SAC 9997 "miscellaneous services" cannot be stretched to cover real estate transactions.
SC (May 22, 2026)
Dismissed Revenue's SLP. Oral observations: "This is not furtherance of business. He has assigned the entire leasehold rights to the other party with the permission of MIDC. He has paid premium also. This cannot come within supply." — "We are not inclined to interfere with the impugned judgment and order of the High Court, hence, the special leave petition is dismissed."
Why "Course of Furtherance of Business" Test Fails Here
Section 7(1)(a): supply must be "in the course or furtherance of business." Aerocom's business = manufacturing cushions. It is NOT in the business of trading or dealing in immovable property. A one-time capital monetisation of a factory leasehold interest = capital transaction, not a business/trading transaction.
Legal Nature: Transfer of Immovable Property
An outright assignment extinguishes the lessee-assignor's rights and substitutes the assignee vis-à-vis the lessor (MIDC). This is NEITHER a fresh lease NOR a sub-lease. Under Section 3(26) General Clauses Act, 1897 and Section 3 Transfer of Property Act, 1882 — "benefits arising out of immovable property" IS immovable property itself. Hence cannot be artificially treated as "supply of service."
Schedule II Clause 2 — What IS a Supply
(a) Lease, tenancy, easement, licence to OCCUPY land = supply of services
(b) Lease or letting out of BUILDING for business = supply of services
→ An outright assignment/transfer is NEITHER of these — it extinguishes the original lessee's rights entirely
(b) Lease or letting out of BUILDING for business = supply of services
→ An outright assignment/transfer is NEITHER of these — it extinguishes the original lessee's rights entirely
Past Advance Rulings Overruled
Gujarat AAR (Re: Gujarat IDC) and Maharashtra AAAR (Re: India Pistons) had held assignment of leasehold rights = taxable service under SAC 9997 at 18%. SC ruling effectively overrules these advance rulings to the extent of inconsistency.
1
SC called upon Revenue to demonstrate that assignment was "in course or furtherance of business" — Revenue could not do so.
2
Assignment was a one-time outright transaction that extinguished the Assessee's rights in the plot — it was a capital transaction, not a recurring business activity.
3
Transfer of benefits arising out of immovable property has no nexus with Aerocom's cushion-manufacturing business — "supply of service in the course of business or in furtherance of business" (Section 7(1)(a)) is completely absent.
4
Revenue's SLP dismissed with delay condoned. Bombay HC judgment upholding that no GST applies is affirmed.
- Refund Claims: Assessees who paid GST under protest on such assignment transactions are now in a strong position to claim refund under Section 54 CGST Act — subject to limitation and bar of unjust enrichment. File refund applications promptly.
- Pending Show Cause Notices / Demands / Appeals: Pending SCNs, adjudication orders and appeals on this issue should be dropped or set aside following the ratio of this judgment.
- ITC Reversal Risk: Assessees who availed ITC of GST charged by the assignor on such transactions must revisit — ITC on a non-supply is impermissible under Section 17(1).
- Stamp Duty Continues: This judgment does not affect stamp duty liability. The transaction is still a transfer of immovable property liable for stamp duty under the relevant State Stamp Act.
- Important Distinction — What REMAINS Taxable: (a) Original allotment by GIDC/MIDC on 30+ year lease = exempt supply (Entry 41, Notif. 12/2017-CT — Nil rate); (b) Transfer fee paid TO GIDC/MIDC for permission to assign = TAXABLE supply of service at 18%; (c) Consideration received by original lessee FROM third-party assignee for outright transfer = NOT TAXABLE (this ruling).
💼 Recommendation for Revenue
Revenue is well-advised to issue suitable trade notices/instructions to field formations to ensure no further demands are raised and pending demands are dropped on this issue. The SC's clear oral observations leave no room for continued enforcement.
Rishi Nand Kishore Gupta v. Union of India | WP No. 6657/2026 | March 23, 2026
Facts
CEO of Fino Payments Bank arrested (Feb 27, 2026) in DGGI investigation into illegal online gaming platforms operated through fintech shell entities. ₹840 crore GST evasion out of ₹3,000 crore transactions. Petitioner claimed he was "in custody" from 1:03 PM Feb 26 when movement was restricted during search — arguing 24-hour rule violated.
Held — Key Points
• Formal arrest time = 5:50 AM Feb 27; produced before Magistrate at 8:30 PM Feb 27 = within 24 hours ✓
• Presence during lawful search under Section 67(2) CANNOT be equated with arrest
• Grounds of arrest showed sufficient material: mastermind in organised syndicate involving dummy program managers, shell entities, routing funds without GST
• Offences under Section 132(1)(a) and (i) are cognizable and non-bailable
• Reasons to believe were properly recorded before arrest authorised
• Presence during lawful search under Section 67(2) CANNOT be equated with arrest
• Grounds of arrest showed sufficient material: mastermind in organised syndicate involving dummy program managers, shell entities, routing funds without GST
• Offences under Section 132(1)(a) and (i) are cognizable and non-bailable
• Reasons to believe were properly recorded before arrest authorised
Practical Lesson
Mere filing of written replies to summons under Section 70 — without personal appearance — may constitute non-cooperation and invite adverse action. Taxable persons summoned under Section 70 are legally bound to appear in person and produce documents called for.
Asst. Commissioner of Central Taxes v. Merck Life Science Pvt. Ltd. | WA No. 110/2026 | March 17, 2026
Facts
Merck Life Science paid IGST in Oct 2017 treating services as export; then corrected and paid CGST/SGST in March 2018. IGST not refunded. Refund application filed March 30, 2024 — rejected as time-barred. Single Judge held Section 54 is "directory" — Division Bench reversed.
Held
• Two-year limitation under Section 54 = MANDATORY, not directory
• No enabling provision in CGST Act to condone delay through statutory process
• Relaxing Section 54 without corresponding extension under Sections 73/74 = meaningless
• BUT: writ jurisdiction under Article 226 remains available for delay condonation in deserving cases — must be balanced with extension of time to Revenue to invoke Sections 73/74
• Applied: double taxation undisputed + only 6 months delay → delay condoned, refund ordered within 60 days
• No enabling provision in CGST Act to condone delay through statutory process
• Relaxing Section 54 without corresponding extension under Sections 73/74 = meaningless
• BUT: writ jurisdiction under Article 226 remains available for delay condonation in deserving cases — must be balanced with extension of time to Revenue to invoke Sections 73/74
• Applied: double taxation undisputed + only 6 months delay → delay condoned, refund ordered within 60 days
Alternative Route Available
AP HC (Nspira): Two-year limit may NOT apply to tax paid under mistake on exempt services — such payment is not "tax due" but a deposit without authority of law under Article 265. Gujarat HC (Comsol Energy, Binani Cement): limitation provisions don't apply to amounts paid under mistake. Constitutional mandate under Article 265 — no tax shall be retained without authority of law.
Taiyo Nippon Sanso India Pvt. Ltd. v. Union of India | WP No. 1966/2025 | April 22, 2026
Facts
Manufacturer of industrial/medical specialty gases. Central GST conducted audit (Sep 2021 to Nov 2022). Meanwhile State GST also issued ASMT-10 discrepancies and passed Section 73(9) order (Apr 21, 2022). Petitioner filed rectification application under Section 161 (Jul 20, 2022) with detailed reply and objection that Central GST audit already covered the same period = no parallel proceedings. Without considering submissions or granting hearing, Rectification Order dated Oct 20, 2022 was passed — and raised ADDITIONAL demand beyond the original SCN.
Section 161 — The Key Proviso
Third proviso: "where such rectification adversely affects any person, the principles of natural justice shall be followed." Bombay HC: Not only absence of hearing, but also failure to consider substantive jurisdictional objection (overlapping Central/State GST proceedings) vitiates the rectification order.
Divergent HC Views on Section 161
Bombay / Delhi / Calcutta HCs (predominant view): Where rejection of rectification application has civil consequences → hearing mandatory
Madras HC (Eminent Textiles): Third proviso triggered only on actual rectification/alteration — mere refusal to rectify does not mandate hearing. The SC has not yet settled this split.
Madras HC (Eminent Textiles): Third proviso triggered only on actual rectification/alteration — mere refusal to rectify does not mandate hearing. The SC has not yet settled this split.
M/s Steps Care India v. Commissioner of State Tax | Writ Tax No. 1200/2026 | February 19, 2026
Facts & Holding
Registration cancelled November 13, 2019. SCN issued May 27, 2024 — uploaded only on GST portal. Adjudication order passed August 28, 2024 ex parte. HC: once registration is cancelled, person cannot access or work on the common portal. Portal upload = NOT effective service. Section 169(1)(a) and (b) — physical service is mandatory. Adjudication order quashed; fresh notice via physical mode within 10 days.
Section 169 — Valid Service Modes
(a) Direct delivery/courier to taxpayer or authorised representative
(b) Registered post / speed post with acknowledgement
(c) Email to registered email ID
(d) Common portal ← ONLY valid when taxpayer CAN access portal (registration active)
(e) Newspaper publication
(f) Affixation at last known premises
Also: Limitation period for Section 107 appeal starts from actual/constructive communication — not from portal upload date.
(b) Registered post / speed post with acknowledgement
(c) Email to registered email ID
(d) Common portal ← ONLY valid when taxpayer CAN access portal (registration active)
(e) Newspaper publication
(f) Affixation at last known premises
Also: Limitation period for Section 107 appeal starts from actual/constructive communication — not from portal upload date.
HSBC Ltd. v. State of Maharashtra | WP (L) No. 4698/2026 | February 20, 2026
Issue
HSBC had filed appeal before GSTAT; recovery notices were issued during pendency of that appeal. HSBC filed writ petition in HC arguing CGST Act does not expressly empower GSTAT to grant interim stay. HC dismissed writ petition.
Held
• Section 113(1): Tribunal may "pass such orders as it thinks fit" = wide appellate jurisdiction including interim relief
• Power to grant interim stay is inherent and incidental to appellate jurisdiction — denying it renders appellate remedy illusory
• Rule 10 GSTAT Procedure Rules 2025: expressly preserves inherent powers
• Rule 29: interlocutory applications for stay are expressly provided for
• Section 112(9): recovery stays upon payment of pre-deposit under Section 112(8)
• High Courts cannot bypass GSTAT to act as interim forums when GSTAT is operational
• Power to grant interim stay is inherent and incidental to appellate jurisdiction — denying it renders appellate remedy illusory
• Rule 10 GSTAT Procedure Rules 2025: expressly preserves inherent powers
• Rule 29: interlocutory applications for stay are expressly provided for
• Section 112(9): recovery stays upon payment of pre-deposit under Section 112(8)
• High Courts cannot bypass GSTAT to act as interim forums when GSTAT is operational
Practical Guidance
If recovery proceedings are initiated during GSTAT appeal pendency: (1) File interlocutory application for stay before GSTAT using GSTAT Form-01; (2) Do not directly approach High Court for interim stay — it will be dismissed for alternative remedy; (3) GSTAT can and will grant interim protection pending final disposal.
GST — Notifications, Circulars & Updates
GSTAT launches, E-Way bill changes, administrative orders, AAR rulings and industry developments
GSTAT Launch
GSTAT Andhra Pradesh State Benches Commence Functioning at Vijayawada and Visakhapatnam
Public Notice No. 01/2026 dated May 27, 2026
GST Appellate Tribunal is now fully operational in AP. Vijayawada Bench temporary address: Flat No. 401, Vinaygarh Apartments, Brindavan Colony, Labbipet, Vijayawada – 520010. Hearings via virtual, hybrid or physical mode at Vice-President's discretion.
Vijayawada Bench — 15 Districts
Krishna, NTR, Guntur, Palnadu, Bapatla, Prakasam, Sri Potti Sriramulu Nellore, Kurnool, Nandyal, Ananthapuramu, Sri Sathya Sai, YSR Kadapa, Annamayya, Tirupati, Chittoor
Visakhapatnam Bench — 11 Districts
Srikakulam, Vizianagaram, Parvatipuram Manyam, Alluri Sitharama Raju, Visakhapatnam, Anakapalli, Kakinada, Dr. B.R. Ambedkar Konaseema, East Godavari, West Godavari, Eluru
Filing & Helpdesk
E-filing: efiling.gstat.gov.in | Helpline: 1800-103-4782 | All filings must follow GSTAT (Procedure) Rules, 2025. Members: Shri Bhaskar Reddy Vemireddy (Vice-President) + Shri Satish Kumar Agrawal (Technical Member-Centre, temporarily assigned from Raipur)
State Notification
Haryana Extends GSTAT Appeal Filing Deadline to June 30, 2026 for All Pre-April 2026 Orders
Notification No. 06/GST-2 dated May 18, 2026 — Haryana Excise & Taxation Department
- Orders communicated before April 1, 2026: Appeal before GSTAT may be filed up to June 30, 2026
- Orders communicated on or after April 1, 2026: Normal 3-month period from communication date
- Aligned with Central Government notification. Aim: facilitate orderly transition of pending appeals to GSTAT and reduce litigation backlogs.
AAR Admin
Delhi Government Nominates Special Commissioner as Member of Delhi Authority for Advance Ruling (DAAR)
Order No. F.4/Notification/Member/DAAR/DT&T/2026/206 dated May 14, 2026
Sh. Santosh Kumar Rai, IAS, Special Commissioner-I, nominated as the State Government member in DAAR. Enables smooth functioning for advance rulings on: supply classification, GST applicability, ITC admissibility, tax liability determination, and valuation queries.
E-Way Bill
West Bengal Reduces Intra-State E-Way Bill Threshold from ₹1,00,000 to ₹50,000 — Effective June 1, 2026
Notification No. 02/2026-C.T./GST dated May 22, 2026 + Trade Circular No. 01/2026 dated May 25, 2026
All intra-state movement of goods originating and terminating within West Bengal where consignment value exceeds ₹50,000 now requires a mandatory e-way bill. Supersedes Notification No. 03/2023-C.T./GST (which had set ₹1,00,000 threshold).
Job Work — Fully Exempt (Any Value)
Intra-state movement related to job work (Section 2(68) CGST Act) remains FULLY EXEMPT regardless of consignment value:
• Goods sent by principal to job-worker
• Goods sent from one job-worker to another
• Goods returned by job-worker to principal after completion
• Goods sent by principal to job-worker
• Goods sent from one job-worker to another
• Goods returned by job-worker to principal after completion
Illustrative Examples
Example 1 — ₹40,000: Job work = No e-way bill (exempt). Non-job work = No e-way bill (below ₹50K threshold).
Example 2 — ₹60,000: Job work = No e-way bill (exempt regardless of value). Non-job work = E-way bill MANDATORY (exceeds ₹50K).
Example 2 — ₹60,000: Job work = No e-way bill (exempt regardless of value). Non-job work = E-way bill MANDATORY (exceeds ₹50K).
Purpose of the Change
Enhance GST revenue tracking, curb under-reporting of intra-state transactions, check evasion on smaller consignments, and improve transparency in goods movement within West Bengal.
Admin — TN
Tamil Nadu Empowers Joint Commissioner to Revoke Cancelled GST Registrations — Retrospective Effect from October 1, 2023
Notification No. 02/2026-TNGST dated May 19, 2026
Joint Commissioner designated as competent authority under first proviso to Rule 23(1) TNGST Rules for processing revocation of registration cancellation applications. Retrospective effect from October 1, 2023 — validating all actions taken since that date. Aims to expedite pending revocation applications and provide timely relief to deregistered taxpayers seeking to resume business.
GSTAT Launch
GSTAT Bengaluru Bench Commences Operations at NACIN Premises — Jurisdiction Over Entire Karnataka
Public Notice No. 01/2026 dated May 27, 2026 — GSTAT Bengaluru
Temporary premises: Ground, 3rd and 5th Floor, NACIN, No. 40, HMT Factory Main Road, Next to HMT School, Jalahalli, Bengaluru – 560013. Jurisdiction: entire State of Karnataka (all districts) per DoR Notification S.O. 5063(E) dated November 26, 2024. Same helpline: 1800-103-4782 | Portal: efiling.gstat.gov.in
GSTAT Procedure
GSTAT Ghaziabad Bench: Unsigned SCNs and Orders-in-Original Flagged as Appeal Defects — Critical Issue for UP Taxpayers
GSTAT Ghaziabad Bench Order dated May 7, 2026 — Filing No. 2025109301000004 (Atul Kumar Agarwal v. Additional Commissioner–Appeal, Grade-2, Moradabad)
Registrar Court flagged five defects and directed cure within 15 days:
- Defect 1: SCN invalid — unsigned by issuing authority
- Defect 2: Order-in-Original invalid — unsigned by adjudicating authority
- Defect 3: Pre-deposit under Section 112 CGST Act not deposited
- Defect 4: Court fee paid was insufficient
- Defect 5: Documents in Hindi not translated into English as required by Rule 23, GSTAT (Procedure) Rules, 2025
⚠️ Critical Issue for UP Taxpayers
In UP, GST authorities routinely issue orders without physical signatures and simply upload them on the GST portal. Appellants possess only portal-downloaded copies — not physically signed originals. The Registry's insistence on "signed" originals creates a practical problem. Immediate Action: Obtain certified copies of all GST orders immediately upon issuance. Translate all Hindi-language orders/documents to English before filing GSTAT appeals. Deposit correct pre-deposit amount well before filing.
TN AAR
Temple Licence Fee for Collection of Devotees' Hair Donations = Taxable Commercial Service at 18% GST
In the case of Arulmigu Mariamman Temple — Temple administration grants licences through tender to contractors to collect hair offerings from devotees. Tamil Nadu AAR held:
- Temple as place of worship ≠ commercial activities by temple administration. The two are distinct.
- Tender process + licence fee from highest bidder = all characteristics of commercial activity = supply of services
- Temple administration is not supplying human hair — it is transferring the RIGHT to collect hair, for consideration
- Classified under SAC 9997 — "Other Miscellaneous Services" per Entry 35, Notification 11/2017-Central Tax (Rate)
- Rate: 18% GST (9% CGST + 9% SGST)
- Exemption continues: where transaction involves actual supply of human hair as goods (not the licence fee situation)
- Commercial activities by religious institutions are taxable; proviso to Sl. No. 13 of Notification 12/2017-CT carves out exceptions to exemption for conduct of religious ceremonies
SC Ruling — Industry
Online Gaming: SC Upholds Retrospective 28% GST on Full Face Value of Bets — Industry Exposure ₹92,000 Crore to ₹2 Lakh Crore
In a landmark ruling, the Supreme Court upheld the government's decision to levy 28% GST on the full face value of bets and deposits (not just platform fees or commissions). The 2023 GST amendments were held "clarificatory" in nature — validating retrospective demands raised by DGGI.
Scale of Impact
Total industry exposure: ₹92,000 crore to ₹2+ lakh crore (including penalties and interest). Multiple gaming companies have already shut down, pivoted away from real-money gaming, or face investor disputes and arbitration. Written judgment still awaited — final strategy not yet determined.
Industry's Three Options Being Evaluated
Option 1: Review petition before SC (industry views this as largely a formality)
Option 2: Approach a larger Constitutional Bench
Option 3 (Industry's real hope): Seek executive/government intervention for condonation of retrospective dues prior to 2023 amendments. Law allows government to condone or soften retrospective recovery. Most companies do not have balance sheets to pay these demands.
Option 2: Approach a larger Constitutional Bench
Option 3 (Industry's real hope): Seek executive/government intervention for condonation of retrospective dues prior to 2023 amendments. Law allows government to condone or soften retrospective recovery. Most companies do not have balance sheets to pay these demands.
Post-2023 Position
The 28% GST on full face value of bets is now clearly settled for all transactions post-2023 amendments. The real dispute is whether pre-2023 transactions should be taxed at the same rate retrospectively — given companies operated on a different tax understanding and paid GST on platform fees only.
GST Compliance Calendar — June 2026
All key GST filing deadlines — click category buttons to filter
10
GSTR-7
TDS Summary — Tax Deducted at Source and deposited under GST
May 202610
GSTR-8
TCS Summary — Tax Collected at Source by e-commerce operators
May 202611
GSTR-1
Monthly Outward Supplies — Turnover >₹5 Crore or opted for monthly filing
May 202613
GSTR-1 IFF
B2B Invoice Filing Facility — Turnover <₹5 Cr, opted for QRMP Scheme
May 202613
GSTR-6
Input Service Distributor — ITC received and distributed by ISD
May 202613
GSTR-5
Non-Resident Taxable Person — Outward supplies and tax payable
May 202620
GSTR-5A
OIDAR Services — Online information and database access/retrieval services
May 202620
GSTR-3B
Monthly Return — Turnover exceeding ₹5 Crore in preceding FY
May 202625
PMT-06
GST Challan Payment — Registered persons opted for QRMP Scheme
May 202628
GSTR-11
Inward Supplies Statement by persons having Unique Identification Number (UIN)
May 202630
GSTR-4
Annual Return — Composition Dealers for Financial Year 2025-26
FY 2025-26 ⚠️30
GSTAT Appeals
Last date for GSTAT appeals (orders communicated before April 1, 2026) — Haryana
Pre-Apr 2026 OrdersCustoms & DGFT — Trade Policy Updates
India-Oman CEPA Rules of Origin, Cotton duty exemption, and SION revisions for chemical exporters
Customs Notification
India-Oman CEPA: Comprehensive Rules of Origin Framework Notified — Effective June 1, 2026
Notification No. 48/2026-Customs (N.T.) [S.O. 419(E)] dated May 29, 2026 + DGFT Trade Notice No. 06/2026-27 dated May 29, 2026
CBIC notifies complete Rules of Origin for India-Oman CEPA. Only goods certified as originating per these rules qualify for concessional customs duty under CEPA. Simultaneously, DGFT mandates electronic Preferential Certificate of Origin (eCOO) via Trade Connect ePlatform (trade.gov.in).
Origin Criteria (Rule 4)
Goods qualify if: (a) Wholly obtained in the exporting Party (Rule 5: live animals born/raised there, minerals extracted, agricultural/fishery products, goods produced entirely from such materials) OR (b) Satisfy Product-Specific Rules (PSR) in Annexure-B. Two value addition methods permitted: Build-down and Build-up.
Important Rules
De Minimis (Rule 6): Non-originating materials not meeting tariff heading change ≤ 10% FOB value — may still qualify
Bilateral Cumulation (Rule 8): Materials from one Party = originating in other Party for production purposes
Direct Consignment (Rule 13): Goods must be directly consigned — transit through third countries only for unloading/reloading
Record Keeping (Rule 19): 5 years retention of all origin documents
Bilateral Cumulation (Rule 8): Materials from one Party = originating in other Party for production purposes
Direct Consignment (Rule 13): Goods must be directly consigned — transit through third countries only for unloading/reloading
Record Keeping (Rule 19): 5 years retention of all origin documents
Certificate of Origin
Validity: 12 months from issuance. Issued within 5 working days of export date. Accepted as: physical CoO, electronic CoO (eCOO), or origin declaration by approved exporter. eCOO Process: Select "India Oman CEPA (Agency Issued)" on trade.gov.in → authorised agency approves → eCOO with QR code and digital signature generated.
Verification & Compliance
Acknowledge verification request: 15 days. Preliminary response: 30 days. Full verification: 90 days. Preferential treatment may be temporarily suspended (Rule 29) if doubt about origin certificate authenticity. Electronic data exchange between Indian and Oman customs authorities for seamless verification.
Duty Exemption
Cotton Import: Zero Customs Duty + Zero Agriculture Cess — June 1 to October 31, 2026
Notification No. 19/2026-Customs [G.S.R. 420(E)] dated May 30, 2026
Central Government grants temporary NIL duty on Cotton (HS Heading 5201) from June 1 to October 31, 2026 (both dates inclusive). Both Basic Customs Duty (normally 11% inclusive of Social Welfare Surcharge) and Agriculture Infrastructure & Development Cess (AIDC) fully exempted. Effective rate = NIL during this window.
- Purpose: Ensure adequate availability of raw cotton to domestic textile mills and yarn manufacturers at competitive prices during peak processing season
- Beneficiaries: Spinning mills, weaving companies, textile manufacturers sourcing cotton from US, Australia, Brazil and other origins
- Action Required: Note precise dates (June 1 to October 31, 2026). Ensure bill of entry correctly references this notification number to claim exemption. Plan import shipments to arrive within the exemption window.
- After October 31, 2026: Normal duty rate of 11% (inclusive of SWS) + AIDC resumes automatically
DGFT
DGFT Revises SIONs for 6 Chemical & Allied Products — Advance Authorisation Exporters Must Note
DGFT Public Notice No. 13/2026-27 dated May 29, 2026 — Immediate Effect
Standard Input Output Norms (SIONs) under Export Product Group 'A' (Chemicals and Allied Products) revised immediately. Exporters availing Advance Authorisation Scheme must comply with updated input-output norms from this date.
- SION A1090 — Caustic Soda (Flakes/Solid):
2.105 kgCaustic Soda Lye (47–48%) per1 kgexport product - SION A1794 — Gelatine:
3.92 MTGel Bones per1 MTGelatine - SION A1827 — Ossein:
2.24 kgGel Bones per1 kgOssein - SION A3105 — Chlorinated Paraffin 41–45% Chlorine (5 variants): For 41% variant:
0.614 kgParaffin (C10-C30) +0.863 kgChlorine +0.010 kgStabiliser per 1 kg product - SION A3106 — Chlorinated Paraffin 46–50% Chlorine (5 variants): For 46% variant:
0.553 kgParaffin +0.920 kgChlorine +0.010 kgStabiliser per 1 kg - SION A3107 — Chlorinated Paraffin 51–55% Chlorine (5 variants): For 51% variant:
0.5045 kgParaffin +1.02 kgChlorine +0.010 kgStabiliser per 1 kg
Income Tax — Notifications, Updates & Compliance
CBDT directives, ITR filing guidance, June 2026 compliance calendar and tribunal developments
CBDT Circular
CBDT Directs Correct Application of Sections 68, 69A–69D Read with Section 115BBE — C&AG Audit Found Revenue Leakage Due to Errors
CBDT Letter F.No. 225/26/2026-ITA.II dated May 29, 2026 — To all Principal CCITs and DGITs
C&AG compliance audit found AOs were inconsistently invoking deeming provisions and failing to apply mandatory special tax rate under Section 115BBE — causing revenue loss. CBDT now directs four specific corrective actions.
What are Sections 68–69D?
Section 68: Unexplained cash credits
Section 69A: Unexplained investments not recorded in books
Section 69B: Investments, etc. — amount exceeding recorded amount
Section 69C: Unexplained expenditure
Section 69D: Amount borrowed or repaid on hundi in undisclosed manner
Under new IT Act 2025: Corresponding provisions are Sections 102, 103, 104, 105 and 106
Section 69A: Unexplained investments not recorded in books
Section 69B: Investments, etc. — amount exceeding recorded amount
Section 69C: Unexplained expenditure
Section 69D: Amount borrowed or repaid on hundi in undisclosed manner
Under new IT Act 2025: Corresponding provisions are Sections 102, 103, 104, 105 and 106
Section 115BBE — Mandatory Special Rate
Income under Sections 68–69D is taxed at a SPECIAL FLAT RATE under Section 115BBE (Section 195 under IT Act 2025). Key features: no deduction in respect of any expenditure is permissible; no set-off of any loss is allowed while computing income. Non-application or under-application of this rate = revenue leakage.
CBDT's 4 Directions to AOs
1. Investigate first: Satisfy as to true nature and source using Section 133(6) information, survey powers and summons before invoking any section
2. Correct section: Identify the specific applicable provision based on facts — avoid mechanical/blanket invocation
3. Apply Section 115BBE mandatorily whenever adding under Sections 68–69D
4. Correct ITBA entries: Fill relevant columns on the Income Tax Business Application portal correctly to prevent computational errors in tax/carry-forward of losses
2. Correct section: Identify the specific applicable provision based on facts — avoid mechanical/blanket invocation
3. Apply Section 115BBE mandatorily whenever adding under Sections 68–69D
4. Correct ITBA entries: Fill relevant columns on the Income Tax Business Application portal correctly to prevent computational errors in tax/carry-forward of losses
Significance for Taxpayers / Practitioners
Expect more rigorous investigation before deeming provisions are invoked. Also expect stricter insistence on Section 115BBE special rates. In matters before AO: if Section 68/69 additions are proposed, proactively provide documentation on source and nature of credits/investments. Ensure computation sheets reflect correct applicable tax rates.
Compliance Calendar
June 2026 Income Tax Key Deadlines
- June 7: Deposit of Securities Transaction Tax (STT) and Commodities Transaction Tax (CTT) for May 2026
- June 15: Form 16 (salary TDS certificate to employees for FY 2025-26) | Form 16A (non-salary quarterly TDS certificate — Q4 ending March 31, 2026) | Form 12BA (statement of perquisites for FY 2025-26) | Forms 64A, 64D (by business trusts and AIFs) | Form 64E (securitisation trusts)
- June 29: Form 3CEK (eligible investment fund statement to AO) | Form 49D (information by Indian concern under Section 285A)
- June 30: STT/CTT annual return (FY 2025-26) | Forms 10-IJ and 10-IL (if return due date is July 31, 2026) | Form 26QAA (quarterly return of non-deduction of TDS by banking company — Q4) | Form 3AF (preliminary expenses statement under Section 35D) | Forms 64B, 64C, 64F (income distributed by trusts to investors) | Commodities Transaction Tax annual return for FY 2025-26
ITR Filing
ITR-2 Excel Utility Version 1.0 and JSON Schema Released for AY 2026-27 — May 26, 2026
Income Tax Department released Excel-based offline utility (8.79 MB) and JSON Schema (380 KB) for ITR-2 for Assessment Year 2026-27 on May 26, 2026. Available at incometax.gov.in. Who files ITR-2: Individuals and HUFs not having income from profits and gains of business or profession — including NRIs, those with multiple house properties, capital gains, foreign assets/income, or income exceeding the conditions for ITR-1. ITR-1 and ITR-4 utilities were released earlier.
Filing Advisory
7 Important Reasons Taxpayers Should Wait Until Mid-June Before Filing ITR for AY 2026-27
- Reason 1 — AIS/26AS incomplete: Salary TDS returns (Form 24Q) are due May 31 — data feeds into AIS only after processing. Early filers risk using incomplete data.
- Reason 2 — Salary TDS: Employers submit Form 24Q close to deadline. Employees filing before June risk missing salary and TDS deduction details.
- Reason 3 — Non-salary TDS: Banks and deductors file Form 26Q (for interest, dividends, professional payments) by May 31. TDS credits incomplete before processing.
- Reason 4 — Wait for Form 16: Employers must issue Form 16 by June 15, 2026. Deductors issue Form 16A around the same time. These are essential for TDS reconciliation.
- Reason 5 — SFT Updates: Statement of Financial Transactions (mutual funds, property, securities, large deposits, credit card payments) continue until May-end under Section 285BA — AIS entries appear later.
- Reason 6 — Risks of early filing: Mismatch notices, refund delays, denial of TDS credit, tax demands, need to file revised returns, rectification proceedings.
- Reason 7 — AIS reconciliation is now critical: Income Tax Department increasingly relies on automated data matching. Reconcile AIS, Form 26AS, Form 16/16A and pre-filled ITR before submitting. Accurate reporting is more important than filing early.
📅 ITR Deadline Reminder
For salaried taxpayers not required to undergo audit: July 31, 2026 (unless extended). Belated return (after deadline): up to December 31, 2026 but with ₹5,000 late fee and loss of right to carry forward losses. ITR-U (Updated Return) allows correction up to 2 years from assessment year end.
ITAT Mumbai
Spouse's Name on Property Papers Not Sufficient to Tax Entire Sale Proceeds in Their Hands — Beneficial Ownership Must Be Established
In a case involving AY 2018-19, tax department reopened assessment after learning taxpayer (Ms. Gupta) had sold a property for ₹62.5 lakh but not filed a return. AO completed ex parte assessment and treated entire ₹62.5 lakh as taxable income in her hands. ITAT Mumbai bench (Amit Shukla, JM + Makarand Vasant Mahadeokar, AM) directed AO to verify the claim that she was only a nominal co-owner — property was entirely purchased and sold by her husband using his own funds, capital gains already disclosed in husband's return.
- Taxpayer's contention "goes to the root of the matter" — directly affects taxability
- Neither the I-T officer nor CIT(Appeals) examined the nominal co-ownership claim
- AO must now verify: ownership pattern, source of funds, whether capital gains already taxed in husband's hands
- Consistent with ITAT precedent: in family property transactions, names added as co-owners for succession planning/convenience (without contributing funds) — taxation follows real/beneficial owner, not mere name on documents
Supreme Court
SC Seeks Centre's Reply on Long-Standing Staff and Member Vacancies in Income Tax Appellate Tribunal
PIL filed by ex-Vice President of ITAT (Parveen Kumar Bansal) brought to SC's attention that registrar and officer posts are lying vacant for years. Bench of CJI Surya Kant and Justice Joymalya Bagchi expressed surprise and sought Attorney General's assistance. SC directed: (1) Fill unfilled posts at earliest; (2) As stop-gap, request High Courts to send judicial officers on deputation where officers can be spared. SC said it would also look into the issue on the administrative side.
News Flash
Quick headlines from tax, trade and finance this week
Govt plans 0.2% turnover tax on retailers in FY '27 Budget
Small MF distributors latch on to online platforms to beat GST complications
Customs officers play vital role in national security, trade: MoS Pankaj Chaudhary
Rajasthan records ₹37,000 crore income tax collection — 7% higher than previous year
States hold fuel VAT rates; see up to 58% rise in sales tax revenue
Kerala's new UDF government proposes measures to improve tax collection and project implementation
UP becomes largest GST taxpayer State; CM Yogi reviews revenue and tax administration
SC upholds govt retrospective 28% GST levy on online gaming companies
GST 2.0 guidelines fail to resolve refund delays: Experts
FM Nirmala Sitharaman unveils new MSME initiatives to boost credit access and modernisation
Govt open to views on capital gains tax cuts amid FPI outflows: FM
Customs requests international passengers to use ATITHI 2.0 App to declare dutiable goods
SC rules Exxsol Hexane a pure hydrocarbon; customs duty cut to 2.5%
Industry asks Centre to cut FPI withholding tax on debt securities to 5%
International Road Federation seeks GST cut on helmets, ambulances, essential medical equipment
Online gaming verdict: firms evaluating options to pay ₹1 lakh crore+ in GST
Delta Corp plunges after apex court backs 28% GST on online gaming bets
Finance Ministry to conduct factory visits for ground-level Budget planning inputs
Insurance premium financing gaining traction after GST waiver: Expert
Why SC's verdict on online gaming GST could be a death blow to the sector