Tax Weekly Round-Up: December 01 - December 07, 2025

SUPREME COURTCentral Excise Exemption For Cotton Fabrics Not Available If Any Interlinked Process Uses Power : Supreme CourtCause Title: COMMISSIONER OF CUSTOMS, CENTRAL EXCISE & SERVICE TAX, RAJKOT VERSUS NARSIBHAI KARAMSIBHAI GAJERA & ORS.The Supreme Court has held that manufacturers cannot claim central excise duty exemption for processed cotton fabrics if power is used at any stage of the manufacturing chain, even when the work is carried out through separate units. The Court restored a duty and penalty demand that had been set aside by the Customs, Excise and Service Tax Appellate Tribunal (CESTAT).To claim excise duty exemption for 'cotton fabrics' processed without the aid of power or steam, the manufacturing stages must be completely independent; if the final product cannot emerge without each interlinked process, including those involving power, the exemption cannot be availed.Supreme Court Seeks Centre's Response On Plea Seeking GST Concession For Car Purchase By Persons With DisabilitiesCase Title: KULDIPAK RAJESH PRASHAD Versus UNION OF INDIA AND ORS. Case no.: W.P.(C) No. 1140/2025The Supreme Court recently issued notice on a petition filed by a person suffering visual impairment seeking that the government revive its GST Concession scheme for the purchase of cars by persons with orthopaedic disability and extend it to all Persons with Disabilities, irrespective of the nature of their disability.A bench of Justices Vikram Nath and Sandeep Mehta passed the order, after hearing counsel for the petitioner, who argued that the Union has taken different stands before different High Courts, which has resulted in conflicting opinions on the government's now-discontinued scheme. The counsel also informed the Court that the scheme existed in one form or another since 1999 but came to be withdrawn in 2025.GST Exemption For Residential Lease Applies When Lessee Sub-Leases Building For Hostel/PG Use : Supreme CourtCase : The State of Karnataka v Taghar Vasudeva AmbrishIn a significant judgment that will have wide ramifications for hostel and paying guest (PG) accommodation sectors, the Supreme Court held that the exemption from Goods and Services Tax (GST) available for renting residential dwellings continues to apply even when the lessee sub-leases the premises to provide hostel or PG accommodation. The Court ruled that the exemption under Entry 13 of the GST Exemption Notification No.9/2017 dated 28.06.2017 does not require the lessee to personally use the property as a residence, so long as the ultimate use of the premises is residential in nature.A bench of Justice JB Pardiwala and KV Viswanathan delivered the ruling while deciding a dispute concerning a four-storeyed residential building with 42 rooms in Karnataka. The building's owner had leased it to M/s DTwelve Spaces Private Limited, a company operating as an aggregator providing long-term hostel accommodation to students and working women. The tax authorities took the view that GST at 18 percent was payable on the rental transaction because the lessee was a commercial entity and did not itself occupy the premises as a residence. Both the Authority for Advance Ruling (AAR) and the Appellate Authority for Advance Ruling (AAAR) upheld this interpretation. However, the Karnataka High Court set aside the rulings of AAAR and AAR, holding that the GST exemption will apply. Challenging the High Court's judgment ,the revenue appealed to the Supreme Court.HIGH COURTSAllahabad HCEvasion Of Tax Cannot Be Attributed To Transporter When Consignor Accepts Error In Loading Goods: Allahabad High CourtCase title: M/S Anish Transport Company v. State of U.P. and 2 othersCase no.: WRIT TAX No. - 324 of 2022The Allahabad High Court has held that evasion of tax cannot be attributed to the transporter when consignor accepts error in loading goods.Certain goods were intercepted in transit from Dehradun to Delhi. After notices were issued to the cosigner/ consignee, the goods were released in their favour. Subsequently, an order alleging intention to evade tax under Section 129 of the GST Act was passed against the petitioner who was merely a transporter of the goods. Appeal against the penalty order was also dismissed.Bombay HCBombay High Court Restores Registration Of Imported Car, Says RTO Cannot Ignore Customs Settlement Commissions' FindingsCase Title: Imran Humanyun Chandiwala Vs. The State of Maharashtra & Ors.Case no.: Writ Petition: 12921 of 2025The Bombay High Court has held that authorities cannot override or ignore the findings of the Customs Settlement Commission while taking administrative action. The Court ruled that once the Commission accepts the disclosure, settles duty liability and grants immunity under Section 127H of the Customs Act, its order becomes final and conclusive under Section 127J, and no other authority can indirectly reopen the customs issue.A bench of Justice N.J. Jamadar while hearing the writ petition preferred by the purchaser,...

Tax Weekly Round-Up: December 01 - December 07, 2025

Kapil Dhyani

This is a premium content
Available exclusively to
Our subscribers

INR 1099+GST

Tags

Tax Weekly Round-Up: December 01 - December 07, 2025

Kapil Dhyani

This is a premium content Available exclusively to Our subscribers

INR 1099+GST

Tags

This is a premium content
Available exclusively to
Our subscribers