Insights on
Indian tax law.
GST and Income Tax guides, updates, and practical notes from the Taxonation.AI team.
GSTAT Karnataka: Goods Transported Without Proper E-Way Bill Face Penalty Even If Bill Is Created After Inspection
GSTAT Karnataka held that goods transported without the required e-way bill can attract a penalty under Section 129 even when the e-way bill is generated after the goods are intercepted during inspection.
Taxonation.AI Team · 23 Sept 2026
Advocate’s Office Can Be Searched Under GST Law, But Client Confidentiality Must Be Protected: Delhi HC
The Delhi High Court has clarified that an Advocate’s office can be searched under Section 67 of the CGST Act when a valid search authorization exists. However, the Court emphasized that advocate-client privilege and confidential information belonging to unrelated clients must be protected during the investigation.
Taxonation.AI Team · 21 Sept 2026
GSTAT Lucknow: Demand Proceedings Set Aside as Proper SCN Is Mandatory; DRC-01 Only a Summary cannot Replace Show Cause Notice
GSTAT Lucknow held that DRC-01 cannot replace a proper Show Cause Notice under Section 73 of the CGST/UPGST Act. As the SCN issued was addressed to another taxpayer, the Tribunal set aside the entire proceedings as invalid and void ab initio.
Taxonation.AI Team · 18 Sept 2026
CHENNAI GSTAT Clarifies: Appeal Under Section 112 Cannot Be Filed Before Section 107 Order
GSTAT held that an appeal under Section 112 of the CGST Act cannot be filed before the First Appellate Authority passes an order under Section 107 or 108. Since the Appellant filed the GSTAT appeal before the First Appellate Authority’s rejection order came into existence, the appeal was held premature and not maintainable, with liberty to file a fresh appeal in accordance with law.
Taxonation.AI Team · 17 Sept 2026
Same HSN Classification of Inputs and Finished Products Cannot Automatically Deny Inverted Duty Refund: GSTAT Kolkata Clarifies Scope of Section 54(3)(ii), Rule 89(5) and CBIC Circular 135/05/2020-GST
GSTAT Kolkata has clarified that the similar or overlapping HSN classification of inputs and finished products cannot, by itself, justify denial of refund under the inverted duty structure. Examining Section 54(3)(ii) of the CGST Act, Rule 89(5) of the CGST Rules and CBIC Circular No. 135/05/2020-GST, the Tribunal held that the Circular applies to specific cases involving a reduction in GST rates on the same goods. The ruling provides important guidance on accumulated ITC refunds, HSN classification, and the computation of refund under the inverted duty structure.
Taxonation.AI Team · 16 Sept 2026
GST Refund Cannot Be Denied for Ineligible ITC Without Proceedings Under Section 73/74: Augustan Knitwear Case
The GST Tribunal in the Augustan Knitwear case has held that a refund of unutilised ITC under Section 54(3) of the CGST/KGST Act cannot be denied merely by treating the underlying ITC as ineligible when no proceedings under Section 73 or 74 have been initiated to determine such ineligibility. The Tribunal also emphasized that a vague Show Cause Notice and introduction of new grounds at the appellate stage violate the principles of natural justice. The ruling provides significant relief to taxpayers facing rejection of inverted duty structure refund claims.
Taxonation.AI Team · 15 Sept 2026
Email of GST Show-Cause Notice Went Unnoticed: Karnataka HC Grants One More Opportunity and Restores Registration
The Karnataka High Court quashed the cancellation of GST registration after the taxpayer’s email containing the show-cause notice went unnoticed due to bona fide reasons and unavoidable circumstances. Taking a justice-oriented approach, the Court granted one more opportunity and directed restoration of the registration, subject to filing pending returns and payment of tax, interest and penalty within four weeks.
Taxonation.AI Team · 5 Sept 2026
Toll Plaza Receipts Not Mandatory to Prove Movement of Goods: GSTAT Kolkata Upholds ITC Refund
The Kolkata Bench of GSTAT dismissed two Revenue appeals, holding that toll-plaza discrepancies in a “Bill To–Ship To” transaction cannot alone prove that goods were not supplied or received. The Tribunal also held that upstream supplier irregularities and new allegations not raised in the SCN cannot by themselves justify denial of ITC refunds.
Taxonation.AI Team · 3 Sept 2026
Failure to Effectively Communicate SCN on GST Portal Violates Natural Justice: Calcutta High Court Quashes Bank Account Attachment
The Calcutta High Court has quashed a GST adjudication order, appellate order and consequential bank account attachment after finding a prima facie violation of the principles of natural justice. The Court noted that the show cause notice was uploaded on the GST portal under the “Additional Notice and Orders” tab without separate intimation, leaving the petitioner unable to respond. Since the appeal was dismissed solely on limitation without examination of the merits, the Court directed fresh adjudication after providing the petitioner an opportunity of hearing.
Taxonation.AI Team · 1 Sept 2026
A Gujarat GST Officer Used AI to Cite Case Law. The Citations Didn't Exist. The Court Quashed the Order.
A Gujarat GST officer relied on AI-generated case law while passing a tax order — but the cited judgments either did not exist or had nothing to do with the dispute. In Faiz Enterprise v. State Tax Officer, the Gujarat High Court quashed the GST cancellation orders and warned of possible contempt action. The case has now triggered statewide directions requiring tax officers to verify every AI-generated citation against official sources, offering a sharp lesson on the risks of using AI for legal drafting without verification.
Taxonation.AI Team · 31 Aug 2026
₹28.80 Crore GST Demand Set Aside After Taxpayer Denied Personal Hearing
The Orissa High Court has set aside a ₹28.80 crore GST demand under Section 74 after finding a flagrant violation of natural justice. The Court noted that the taxpayer's request for a personal hearing was ignored and remitted the matter for fresh adjudication after providing a reasonable opportunity of hearing.
Taxonation.AI Team · 26 Aug 2026
No Notice, No Recovery: GSTAT Quashes GST Order Against Legal Heir of Deceased Taxpayer, Upholds ITC Relief Under Section 16(5)
When a GST taxpayer dies mid-litigation, can the Department simply carry on the case against his legal heir without notice? The GSTAT says no. In a recent order, the Tribunal quashed a GST demand for want of notice to the legal representative under Section 93, and separately restored Input Tax Credit worth ₹1.72 lakh by applying the retrospective relief under Section 16(5) — a ruling with lessons for every practitioner handling a case where the taxpayer hasn't lived to see it through.
Taxonation.AI Team · 25 Aug 2026