Tax Weekly Round-Up: March 10 - March 16, 2025

HIGH COURTSAndhra Pradesh HCNotice Under Rule 142(1)(A) Of CGST Rules Must Be Issued Before Issuing Proper SCN: Andhra Pradesh High CourtCase Title: Sri Durga Granites v. The Deputy Assistant Commissioner and OthersCase Number: W.P.Nos.3480 & 6504 of 2020The Andhra Pradesh High Court stated that a notice under Rule 142(1)(A) of CGST Rules must be issued before issuing proper show cause notice.The Division Bench of Justices R. Raghunandan Rao and K Manmadha Rao was addressing a case where notice under Rule-142(1)(A) of the CGST Rules was not issued to the assessees/petitioners, prior to the Orders of assessment.Delhi HCS.29 CGST Act | SCN Must Reflect Both Reasons And Intent Of Retrospective Cancellation Of Registration: Delhi High CourtCase title: JSD Traders LLP v. Additional Commissioner, GSTCase no.: W.P.(C) 2608/2025The Delhi High Court has made it clear that an order cancelling GST registration of a trader with retrospective effect will not sustain unless the show cause notice preceding such decision reflects both the reasons and the authority's intent for retrospective cancellation. A division bench of Justices Yashwant Varma and Harish Vaidyanathan Shankar observed, “in the absence of reasons having been assigned in the original SCN in support of a proposed retrospective cancellation as well as a failure to place the petitioner on prior notice of such an intent clearly invalidates the impugned action.”S.36 Income Tax Act | Deduction For Bad Debt Allowed Only If Assessee Lends In Ordinary Course Of Banking/Money Lending Business: Delhi HCCase title: Principal Commissioner Of Income Tax-7 v. WGF Financial Services Pvt. Ltd.Case no.: ITA 184/2022The Delhi High Court has made it clear that allowance in respect of bad debts as an expense under Section 36 of the Income Tax Act, 1961, is permissible only if: (a) the debt was taken into account for computing the income of the assessee in the previous year in which the amount is written off or prior previous years; or (b) represents money lent in the ordinary course of business of banking or money lending.Income Tax Rules | Centre's Power To Relax Conditions Under Rule 9C Exceptional & Discretionary, Not Ordinarily Subject To Judicial Review: Delhi HCCase title: Cargill India Private Limited v. Central Board Of Direct Taxes.Case no.: W.P.(C) 399/2022The Delhi High Court has made it clear that the power of the Central government to relax conditions prescribed under Rule 9C of the Income Tax Rules 1962, read with Section 72A of the Income Tax Act, 1962, is exceptional, discretionary and cannot ordinarily be subject to judicial review.A division bench of Justices Vibhu Bakhru and Swarana Kanta Sharma observed that the power to relax a Rule or a condition is by way of an exception, and the scope of such power cannot be construed in an expansive manner.S.28(4) Customs Act | Genuine Disagreement With Department Regarding Classification Of Goods Not 'Suppression Of Facts' By Trader: Delhi HCCase title: M/S Ismartu India Pvt. Ltd. v. Union Of India And OthersCase no.: W.P.(C) 15199/2023The Delhi High Court has held that merely because there is disagreement between the Customs department and a trader regarding the classification of the latter's goods for the purpose of levying duty, it does not mean that the trader has indulged in 'suppression of facts' from the Department.A division bench of Justices Yashwant Varma and Harish Vaidyanathan Shankar observed, “Based on the set of facts as they presented themselves, both parties are entitled to make contesting claims. However, a genuine disagreement, as in the present case, of the classification of the goods cannot possibly be elevated to 'suppression'.”Subsequent Notice U/S 28(4) Customs Act Cannot Be 'Supplementary' To Prior Notice U/S 28(1), Both Provisions Operate In Separate Fields: Delhi HCCase title: M/S Ismartu India Pvt. Ltd. v. Union Of India And OthersCase no.: W.P.(C) 15199/2023The Delhi High Court has held that notices under Section 28(1) and Section 28(4) of the Customs Act 1962 operate in different scenarios and even by an exaggerated stretch, cannot possibly be said to be interchangeably issued.Section 28 relates to recovery of duties not levied or not paid or short-levied or short-paid or erroneously refunded. It provides for two separate types of notices: One under Section 28(4) where elements of collusion, wilful mis-statement and suppression are made out in assessee' conduct. The other under Section 28(1) where the elements of Section 28(4) of the Act are absent. “Meaning thereby that it is only in those circumstances where Section 28(4) of the Act is not attracted that a Notice under Section 28(1) of the Act is issued,” a division bench of Justices Yashwant Varma and Harish Vaidyanathan Shankar observed.Contingent Liability vs Laid Out Expense: Delhi HC Allows Vodafone To Claim ₹5.1 Crore Depreciation Over Estimated Costs To Restore Mobile Tower SitesCase title: Vodafone Mobile Services Ltd. v....

Tax Weekly Round-Up: March 10 - March 16, 2025

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Tax Weekly Round-Up: March 10 - March 16, 2025

Kapil Dhyani

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