Indirect Tax Quarterly Digest: January - March, 2025

SUPREME COURTSupreme Court Sets Aside Excise Duty Demand On Oil Marketing Companies For Inter-Supply Of Petroleum ProductsCase Title: Bharat Petroleum Corporation Ltd. versus Commissioner of Central Excise Nashik Commissionerate (and connected matters)Case no.: CIVIL APPEAL NO. 5642 OF 2009In a significant relief for Oil Marketing Companies (OMCs), the Supreme Court ruled (Jan. 20) that prices under the MoU for inter-supply of petroleum products, designed to ensure smooth nationwide distribution, do not constitute "transaction value" and are exempt from excise duty due to their non-commercial nature.The Court emphasised that the inter-supply arrangement was not solely price-driven but aimed at facilitating seamless distribution, rendering it ineligible for excise duty.'Every Statute Prima Facie Prospective Unless Stated Otherwise' : Supreme Court Says 2002 Amendment To CST Act Won't Affect Accrued RightsCase Name: THE STATE OF MAHARASHTRA & ORS. V. PRISM CEMENT LIMITED & ANR.Case no.: CIVIL APPEAL NO.13928 OF 2015The Supreme Court yesterday (on February 12) held that though after the amendment of Section 8(5) of the Central Sales Tax Act, the State Government's right to grant exemption from tax has ceased to exist, the amendment is prospective. Thus, it would not apply to the cases where an absolute exemption has already been granted. The amended Act nowhere stipulates that rights previously accrued stand nullified or all previous exemptions stand cancelled or revoked., the Bench of Justices P.S. Narasimha and Pankaj Mithal said.Benefit Of Input Tax Credit Can't Be Reduced Without Statutory Sanction : Supreme CourtCase Title – State of Punjab & Ors. v. Trishala Alloys Pvt. Ltd.Case no. – Civil Appeal No. 2212 of 2024The Supreme Court recently held that Rule 21(8) of the Punjab Value Added Tax Rules, 2005, which was notified on January 25, 2014, could not be applied to transactions before April 1, 2014, as the enabling amendment to Section 13 of the parent statute, the Punjab Value Added Tax Act, 2005, was effective from that date.This means businesses that bought goods at a higher tax rate before this date are not subject to the limitation imposed by Rule 21(8) when claiming ITC, even if the tax rate was later lowered.GST Act | Can Time Limit To Adjudicate Show Cause Notice Be Extended By Notification Under S.168A? Supreme Court To ConsiderCase Name: M/S HCC-SEW-MEIL-AAG JV v. ASSISTANT COMMISSIONER OF STATE TAX & ORS. Case no.: Petition for Special Leave to Appeal (C) No.4240/2025The Supreme Court is to decide whether the time limit for adjudicating show cause notice and passing an order can be extended by the issuance of notifications under Section 168-A of the GST Act. This provision empowers the Government to issue notification for extending the time limit prescribed under the Act which cannot be complied with due to force majeure. “The issue that falls for the consideration of this Court is whether the time limit for adjudication of show cause notice and passing order under Section 73 of the GST Act and SGST Act (Telangana GST Act) for financial year 2019-2020 could have been extended by issuing the Notifications in question under Section 168-A of the GST Act.,” remarked the Bench of Justices J.B. Pardiwala and R. Mahadevan.BNSS/CrPC Provisions On Rights Of Arrested Persons Applicable To GST & Customs Acts : Supreme CourtCase Title: Radhika Agarwal v. Union of India and Ors.Case no.: W.P.(Crl.) No. 336/2018 (and connected matters)The Supreme Court on Thursday(February 27) delivered a significant ruling on the powers of arrest under the Goods and Services Tax Act and the Customs Act.The Court held that the provisions of the Code of Criminal Procedure (now Bharatiya Nagarik Suraksha Sanhita) on the rights of accused persons are equally applicable to the arrests made both under the Customs Act and the GST Act.Some Merit In Allegations That GST Officials Coerce Assesses To Pay Tax With Threat Of Arrest; It's Impermissible: Supreme CourtCase Title: Radhika Agarwal v. Union of India and Ors.Case no.: W.P.(Crl.) No. 336/2018 (and connected matters)The Supreme Court on Thursday (February 27) observed that there was some merit in the allegation that tax officials coerce assesses to pay the Goods and Services Tax with the threat of arrest. This observation was made by the Court on the basis of data.The Court said that if any person is feeling coerced to pay GST, they can approach the writ court for refund of the tax paid by them under coercion. The Court also said that the officers who indulge in such coercion must be dealt with departmentally.Anticipatory Bail Application Maintainable Against Arrest Under GST Act : Supreme Court Overrules Its Previous JudgmentsCase Title: Radhika Agarwal v. Union of India and Ors.Case no.: W.P.(Crl.) No. 336/2018 (and connected matters)The Supreme Court has overruled its previous decisions which held that anticipatory bail applications were not maintainable with respect to...

Indirect Tax Quarterly Digest: January - March, 2025

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