Tax Weekly Round-Up: July 21 To July 27, 2025

SUPREME COURTForeign Entity Doing Business Through Temporary Premises In India Liable To Tax : Supreme Court Rejects Hyatt International's AppealCause Title: HYATT INTERNATIONAL SOUTHWEST ASIA LTD. VERSUS ADDITIONAL DIRECTOR OF INCOME TAX (and connected matters)The Supreme Court on Thursday (July 24) ruled that the existence of a Permanent Establishment (PE) is sufficient to attract tax liability for a foreign entity in India, even in the absence of exclusive possession of a fixed place of business. The Court clarified that temporary or shared use of premises, when combined with administrative or operational control, is adequate to establish a PE, thereby triggering income tax liability in India.Holding so, the bench comprising Justice J.B. Pardiwala and Justice R. Mahadevan dismissed Hyatt International's appeal against the Delhi High Court's order, which had held the company liable to pay income tax in India on income earned through its Strategic Oversight Services Agreements (SOSA) with Asian Hotels Ltd. for 20 years, the operator of Hyatt's hotel business in India.S.129 CGST Act | Assessee Doesn't Waive Right To Challenge Levy By Mere Payment Of Penalty To Release Goods : Supreme CourtCause Title: M/S ASP TRADERS VERSUS STATE OF UTTAR PRADESH & ORS.The Supreme Court observed that by mere payment of penalty for the release of the goods detained under Section 129 of the Central Goods and Services Tax Act, the assessee cannot be held to have waived the right to file a statutory appeal.The Court ruled that mere payment of penalty for the release of goods detained during transit under the GST regime does not conclude proceedings unless a formal, reasoned order is passed under Section 129(3) of the CGST Act.HIGH COURTSBombay HCBombay High Court Directs GST Council To Develop Mechanism For Cross-State ITC Transfer In Mergers/AmalgamationsCase Title: Umicore Autocat India Private Limited v. Union of IndiaCase Number: WRIT PETITION NO. 463 of 2024The Bombay High Court has directed the GST Council and GST Network to develop a mechanism for cross-state ITC transfer in Mergers/amalgamations.Justices Bharati Dangre and Nivedita P. Mehta permitted the IGST and CGST amount lying in the electronic credit ledger of the Transferor Company to be transferred to the Petitioner Company by physical mode for the time being, subject to the adjustments to be made in future.Delhi HCUnauthenticated Documents From Foreign Govt Regarding Swiss Bank Account Of Assessee Can't Form Basis For Criminal Action: Delhi HCCase title: Anurag Dalmia v. Income Tax OfficeCase no.: CRL.M.C. 1575/2018The Delhi High Court has quashed the criminal proceedings initiated against an assessee under Section 276C, 276D and 277 of the Income Tax Act 1961 merely on the basis of some unauthorised documents alleging existence of an undisclosed Swiss Bank account in his name.In doing so, Justice Neena Bansal Krishna observed, “Merely on some unauthenticated information received from a third Country with no material evidence, is not sufficient to make out a prima facie case and there cannot be a presumption that a person has committed any wrongdoing.Thus, mere surmise and conjectures is not enough to prosecute a person alleging a criminal offence under Section 276D.”Gujarat HCGST Officers Issuing Summons/Arrest Memo Not Required To Be Cross-Examined By Assessee: Gujarat High CourtCase Title: Sazid Ali Khan v. Office of Principal Commissioner, Central GST and Central Excise Commissionerate, Vadodara-I & Ors.Case Number: R/SPECIAL CIVIL APPLICATION NO. 6437 of 2025The Gujarat High Court held that GST officers issuing summons/arrest memo are not required to be cross-examined by assessee.Justices Bhargav D. Karia and Pranav Trivedi observed that the assessee wants to cross-examine the persons who belongs to the department who have either issued the summons or arrest memo. Such persons are not required to be cross-examined by the assessee.Karnataka HCIGST Not Leviable On Secondment Of Employee From Overseas Group Companies: Karnataka High CourtCase Title: M/s Alstom Transport India Limited v. Commissioner of Commercial TaxesCase Number: WRIT PETITION NO.1779 OF 2025 (T-RES)The Karnataka High Court held that IGST is not leviable on secondment arrangement with overseas entities.Justice Sachin Shankar Magadum was addressing the issue of whether a secondment constitutes a taxable supply of manpower services or a non-taxable employer-employee relationship exempt under Schedule III of the CGST Act.Karnataka High Court Directs GST Department To Establish Tracking System For Notices Sent To Taxpayers Via EmailCase Title: M/s Muni Naga Reddy HUF v. The Assistant Commissioner of Commercial TaxesCase Number: WRIT PETITION NO. 12543 OF 2025 (T-RES)The Karnataka High Court has directed the GST department to establish tracking system for notices sent to the taxpayers via emailJustice Suraj Govindaraj stated that it is required for the department to establish a system to ascertain ...

Tax Weekly Round-Up: July 21 To July 27, 2025

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