DHARMA IN THE GST KURUKSHETRA: THE PRISTINE TRUTH

1.The motto of the Hon'ble Supreme Court of India, etched in its emblem, ':' (Yato Dharmastato Jayah), is a 5,000-year-old echo of queen Gandhari's blessing to her son Duryodhana while marching to the great battle at Kurukshetra. Thus queen Gandhari stood taller than supreme court for her noble blessing, knowing firmly that her son would lose both battle and life. It is a profound reminder that while administrative 'power' is permanently temporary, justice is eternal. In the nine years since the launch of the GST regime, the 'billion-dollar question' remains: why does target-oriented governance often lack mercy for the innocent taxpayer? The answer may lie in a lack of the courage to acknowledge that tax systems, like the humans who run them, are inherently fractured from all dimensions.

2.The GST landscape has been stained by a 'tremendous abuse of law'. Driven by revenue targets, authorities have often functioned as mechanical enforcers rather than 'Faithful Trustees' of the public. This high-handedness was harshly addressed in the landmark judgment of Assistant Commissioner (ST) & Ors. Versus M/s. Satyam Shivam Papers Pvt. Limited & Anr. - 2022 (1) TMI 954 - SC Order, where the Hon'ble Supreme Court awarded a significant fine of Rs. 50,000 against an authority for the unlawful detention of a conveyance under Section 129 - the most abused provision. It is easy to pass through 'Strait of Hormuz' but not through Section 129. Another most misused provision is Section 74, without any essential factors on record. Despite such censures, the transformation of the administrative mindset remains tragically slow.

3.To restore justice, the judiciary employs '-' (Neer-Ksheer Vivek)-the wisdom to separate the grain from the chaff. The following few rulings ignite the minds to follow the rule of law:

A.In the The State of Karnataka Versus M/s Ecom Gill Coffee Trading Private Limited - 2023 (3) TMI 533 - Supreme Court, the Hon'ble Supreme court held that victory (ITC entitlement) requires a 'pristine' trail of evidence proving the actual physical movement of goods .

B. In The Commissioner Trade And Tax Delhi Versus M/s. Shanti Kiran India (P) Ltd. - 2025 (10) TMI 607 - SC Order, the Hon'ble Supreme Court reaffirmed that a bona fide purchaser should not be punished for a supplier's failure to deposit tax

C. This issue has been exhaustively well settled by the Hon'ble Gujarat High Court in the case of Maruti Enterprise Through Its Authorized Partner, Jigneshbhai Bharatbhai Tarpara Versus Union Of India & Ors. - 2026 (5) TMI 127 - GUJARAT HIGH COURT and held that genuine recipient need not reverse ITC due to the default of supplier.

D. Irrational and irresponsible interpretation of 'scope of supply' fastening the demand of Rs. 1524 Crores in Tata Sons Private Ltd. Versus Union of India, through the Ministry of Finance, Central Board of Indirect Taxes & Customs, Additional Director, Directorate General of GST Intelligence, Joint Director, Directorate General of GST Intelligence, Joint/Additional Commissioner, Mumbai South Commissionerate. - 2026 (5) TMI 126 - BOMBAY HIGH COURT  by the CGST Authority stood quashed by the Bombay High Court.

E. In M/s Sterling & Wilson Pvt. Ltd. Through Zarine Yazdi Daruvala Versus Commissioner, Odisha, Commissionerate of CT GST & Ors. Sanjukta Gantayat. - 2026 (2) TMI 726 - GSTAT NEW DELHI has quashed the order passed under Section 74 in theabsence of fraud or wilful suppression.

4.These are not just routine judicial rulings but highlight the need for effective transformation at all levels to uphold the rule of law. Here it is not the question of succeeding in the court of law, but who has to bear the mental torture, defame and financial cost for the blunders committed by the authorities? The courts should come heavily on such erring authorities and test the credibility of functioning in good faith or otherwise as provided under Section 157 of the CGST Act. This could prevent the relapse of such stupid orders. Under the guise of revenue, the authorities cannot stand taller than the statute itself nor it is tolerated.

5.The refusal to show mercy often stems from a facade of administrative perfection. However, acknowledging the brokenness of the system-the errors in the portal, the bonafide errors in e-way bills, and the complexity of 'One Nation, One Tax, One Confusion'-can facilitate a more humane tax regime.

6.The landmark judgment of the Hon'ble Supreme Court in Govind Saran Ganga Saran Versus Commissioner Of Sales Tax And Others - 1985 (4) TMI 65 - Supreme Court serves as the 'Lighthouse' of Indian tax jurisprudence. It established the four fundamental pillars of a valid tax-the taxable event, the person liable, the rate, and the measure-declaring that if any pillar is ambiguous, the levy must fail. When authorities ignore these pillars to pursue 'unlawful enforcement and adjudication', the light in the lighthouse is extinguished.

7.Embracing system imperfections fosters a natural desire for administrative mercy. When authorities experience the complexities of law themselves, they may feel a parallel need to extend grace to taxpayers struggling with the same complexities. Mercy acts as a lens, allowing authorities to see the human story behind the GSTIN, recognizing truths that remain hidden under mechanical enforcement. As we navigate the complexities of GST litigation-the constitutional mandate remains supreme. Power may be temporary, but the 'Social Debt' of taxation must be collected through the 'Constitutional Soul' of justice. Ultimately, the goal of a righteous tax regime is a simple, ancient truth. The innocent should never be punished, and the criminal should not miss the punishment. It is only through the cracks in the rigid walls of enforcement that we begin to recognize and honour the shared humanity residing in every taxpayer.

8. The GST landscape is a 'single world' where different players carry different maps. When authorities follow the map of Power, they see only revenue targets and treat every error as a crime; when evaders follow the map of Deceit, they build a web of loopholes that poisons the social contract. Yet, the 'Right Map' remains the Constitution, which views the state as a Faithful Trustee and the law as a compass for justice. By trading suspicion for equity, we move past the fog of 'One Confusion' and find the delight of a system where the law breathes life into the economy rather than suffocating it.

9. The tax authority must embody the spirit of Bhishmacharya, whose ultimate loyalty lay not with the individual occupant of the palace, but with the eternal Throne itself. In the GST regime, the 'King' [ Administrative Boss] is the fleeting pressure of revenue targets, while the 'Throne' is the enduring Majesty of the Law. When officials prioritize collection quotas over statutory integrity, they become like Bhishma in the gambling hall-silent witnesses to the stripping of justice while bound by a narrow sense of duty. True faithfulness requires the authority to act as a Faithful Trustee of the Constitution, recognizing that while kings and targets may change, the 'Right Map' of the law must remain unshakeable to ensure the ultimate Bliss of the nation.