Issues: Whether interest paid on borrowings utilised for advancing loans that generated interest income was deductible from income from other sources.

Analysis: The nexus between the interest-bearing borrowings from banks and non-banking financial companies and the loans advanced to private parties stood established from the assessment record. The borrowings were used to advance the loans on which the assessee earned and declared interest income. Interest expenditure incurred for generating that income was therefore allowable under the applicable deduction provision.

Conclusion: The interest expenditure was allowable and the corresponding disallowances for both assessment years were deleted in favour of the assessee.

Issues: Whether expenditure mistakenly reported as a deduction from income from other sources was allowable as business expenditure.

Analysis: The documentary material, including the profit and loss account, purchase records, VAT returns and sales records, established that the receipts and corresponding expenditure represented the assessee's business transactions. The reporting of the receipts and expenditure under different heads in the return was an error in return preparation and did not alter their true business character.

Conclusion: The disallowance of the claimed expenditure was deleted in favour of the assessee.

Issues: (i) Whether service of the show-cause notice solely by uploading it on the GST portal was valid after cancellation of registration; (ii) Whether the assessee was entitled to an opportunity of personal hearing before adverse adjudication.

Issue (i): Whether service of the show-cause notice solely by uploading it on the GST portal was valid after cancellation of registration.

Analysis: Section 169 permits several modes of service and portal-based communication is not an exclusive mode. Following cancellation of registration, the assessee could not be expected to continue monitoring the GST portal. The undisputed service exclusively through the portal therefore did not effect valid communication of the show-cause notice.

Conclusion: Service solely through the GST portal after cancellation of registration was invalid, in favour of the assessee.

Issue (ii): Whether the assessee was entitled to an opportunity of personal hearing before adverse adjudication.

Analysis: Section 75(4) requires an opportunity of personal hearing where an adverse decision is contemplated or a written request is made. Invalid service deprived the assessee of the opportunity to participate in the adjudication.

Conclusion: The assessee was entitled to a personal hearing before adverse adjudication, in favour of the assessee.

Final Conclusion: The tax adjudication founded on ineffective service was set aside, with liberty for fresh notice and adjudication after affording the required hearing.

Ratio Decidendi: Where GST registration has been cancelled, service of a notice solely by placing it on the GST portal is not valid service; adverse adjudication must follow effective notice and the statutorily required opportunity of hearing.

Issues: Whether the appellant was eligible for the small-service-provider exemption for FY 2013-2014 under Notification No. 33/2012-ST dated 20.06.2012.

Analysis: The exemption was available where the aggregate value of taxable services in the preceding financial year did not exceed the prescribed threshold. The record did not show that taxable services had been rendered in FY 2012-2013. Since the tax proceedings themselves relied on Form 26AS to determine receipts, the nil-payment Form 26AS for FY 2012-2013 was a reasonable basis to determine that the preceding-year turnover was nil. The taxable-service value for FY 2013-2014 was admittedly below Rs. 10 lakh.

Conclusion: The appellant was entitled to the exemption for FY 2013-2014; the service-tax demand, interest and penalties were unsustainable.

Issues: Whether an adjudication order could be sustained where, after cancellation of GST registration, the show-cause notice was made available only on the GST portal and no effective opportunity of personal hearing was afforded.

Analysis: Section 169 of the Central Goods and Services Tax Act, 2017 permits multiple modes of service and portal-based communication is not the exclusive means where the registration had been cancelled. Effective service must reasonably communicate the notice to the taxable person. Section 75(4) requires a personal hearing where an adverse decision is contemplated, embodying the requirement of audi alteram partem. The undisputed facts were governed by the adopted precedent concerning invalid portal-only service following cancellation of registration.

Conclusion: The adjudication order was unsustainable for want of valid service and the required opportunity of personal hearing; the petitioner was entitled to submit a reply and have the matter freshly adjudicated in accordance with law.

Issues: Whether the petitioner should be relegated to the statutory appellate remedy against the ex parte GST adjudication order while being afforded protective directions.

Analysis: Although an appeal was available under Section 107 of the Central Goods and Services Tax Act, 2017, the medical exigencies substantiated by the record and the substantial tax, interest and penalty imposed established a prima facie case for protective intervention. Relegation to the appellate forum without such protection would cause prejudice. The merits of the input tax credit demand and the validity of the ex parte adjudication were left for independent determination in appeal.

Conclusion: The petitioner was permitted to pursue the statutory appeal upon complying with the prescribed pre-deposit and payment of costs; the appellate authority must entertain and decide the appeal independently and expeditiously.

Issues: Whether the assessment orders passed after the assessee did not respond to portal-issued show cause notices should be set aside to permit a reply and fresh adjudication.

Analysis: The notices in DRC-01 had not been answered, while the assessee sought an opportunity to place its merits and supporting documents before the assessing authority and agreed to make a specified deposit. A meaningful opportunity to respond to the notices and substantiate the case warranted fresh consideration, with the deposit operating as a condition for that relief.

Conclusion: The impugned assessment orders were set aside, conditional upon payment of Rs. 50,00,000 in the stipulated instalments and filing a reply with supporting documents; the assessing authority must thereafter make a fresh merits determination after notice.

Issues: Whether the tax-demand order, issued after the petitioner allegedly remained unaware of the show-cause notice because of business closure, should be reconsidered.

Analysis: No merits determination was made. The asserted prior recovery of tax required verification, and an opportunity was provided to file a reply with supporting documents upon payment of any unrecovered balance of disputed tax.

Outcome: The matter was returned for fresh adjudication upon compliance with the stipulated payment and reply requirements.

Issues: Whether the accused was entitled to bail pending investigation of allegations of fraudulent availment of input tax credit through fictitious entities and forged invoices.

Analysis: The firm stood registered in the accused's name, and she was aware that her husband operated it and of its activities. However, she had remained in custody since 15.06.2026; material investigation concerning her appeared complete; certain co-accused had been granted bail; and she was a woman with a minor child while her husband was also in custody. Balancing these circumstances against the nature and gravity of the allegations, further custodial detention was not considered warranted for the investigation.

Conclusion: The accused was entitled to be enlarged on bail.

Issues: Whether a revision under Section 264 was maintainable despite the availability of an appellate remedy where the limitation for filing the appeal had expired.

Analysis: Section 264(4) restricts exercise of revisional jurisdiction where an appeal lies but has not been filed within the subsisting appeal period, or where the assessee has not waived the right of appeal in cases requiring such waiver. As the appeal limitation had expired and no appeal or delay-condonation application was pending, the statutory bar did not apply. The revisional authority consequently erred in declining jurisdiction merely because an appellate remedy had originally been available. Observations on merits made after holding the revision non-maintainable were also affected by that erroneous jurisdictional view.

Conclusion: The revision was maintainable; the revisional authority was required to decide it afresh on merits without being influenced by its earlier observations.

Issues: (i) Whether initiation of the bankruptcy process was vitiated by denial of notice and breach of natural justice; (ii) Whether the challenge to limitation and invocation of the personal guarantee could be raised at the bankruptcy stage; (iii) Whether dismissal of the connected proceeding against the co-guarantor invalidated the proceedings against the appellant.

Issue (i): Whether initiation of the bankruptcy process was vitiated by denial of notice and breach of natural justice.

Analysis: The appellant had been proceeded ex parte in the personal insolvency resolution proceedings under an unchallenged order. The record established service of the closure application and of the bankruptcy petition at the appellant's admitted email address. Section 121 does not require prior notice to the debtor before a bankruptcy order following a closure order, while the Code provides no corresponding right to object to a closure report under Sections 112, 114(1) and 115(2). Challenges concerning alleged non-furnishing of information and the closure process sought to reopen orders that had become final.

Conclusion: The bankruptcy process was not initiated in breach of natural justice; this issue is against the appellant.

Issue (ii): Whether the challenge to limitation and invocation of the personal guarantee could be raised at the bankruptcy stage.

Analysis: The unchallenged admission order had determined that the 2015 notice under the SARFAESI Act was for enforcement of security interest and that the personal guarantee was first invoked through the 2022 demand notice. The insolvency application was filed within three years of that invocation. The appellant could not collaterally challenge the final admission and closure orders through an appeal directed against the consequential bankruptcy order, particularly when the relevant pleas had not been urged before the Adjudicating Authority.

Conclusion: The limitation challenge was unavailable and, in any event, the personal insolvency application was within limitation; this issue is against the appellant.

Issue (iii): Whether dismissal of the connected proceeding against the co-guarantor invalidated the proceedings against the appellant.

Analysis: Proceedings against each personal guarantor are separate and must be determined on their respective records. The dismissal of the petition against the co-guarantor therefore did not affect the unchallenged admission and closure orders concerning the appellant.

Conclusion: The connected proceeding did not undermine the validity of the bankruptcy proceedings against the appellant; this issue is against the appellant.

Final Conclusion: The unchallenged personal insolvency resolution and closure orders remained binding, and validly supported continuation of the bankruptcy process against the appellant.

Ratio Decidendi: A debtor who has been proceeded against ex parte and has not challenged the final personal insolvency admission and closure orders cannot collaterally assail the consequential bankruptcy order on grounds that were available in the earlier proceedings.

Issues: (i) Whether Hydraulic Oil is a petroleum product covered by Entry 67 of the First Schedule and Sl. No. 1(viii)(e) of the Notification dated 30.03.2002, and is liable to entry tax as a consumable; (ii) Whether the requirements for reassessment under Section 6(1) were satisfied.

Issue (i): Whether Hydraulic Oil is a petroleum product covered by Entry 67 of the First Schedule and Sl. No. 1(viii)(e) of the Notification dated 30.03.2002, and is liable to entry tax as a consumable.

Analysis: Entry 67 covers petroleum products including specified products followed by the expression "and others", while excluding particular products. That expression encompasses petroleum products not expressly enumerated. Hydraulic Oil is a petroleum product and, consistently with the binding interpretation applicable to Hydraulic Oil, is a consumable used in hydraulic systems rather than a raw material from which a finished product emerges. The decisions concerning other commodities or materials used as raw materials did not govern its classification.

Conclusion: Hydraulic Oil falls within Entry 67 and the notification entry, is a consumable and is liable to entry tax; this issue is against the assessee.

Issue (ii): Whether the requirements for reassessment under Section 6(1) were satisfied.

Analysis: The finding that the statutory conditions for reassessment of escaped or under-assessed turnover were fulfilled disclosed no jurisdictional infirmity, patent illegality, or error warranting revisional interference.

Conclusion: The requirements of Section 6(1) were satisfied; this issue is against the assessee.

Final Conclusion: The entry-tax levy on Hydraulic Oil and the reassessment findings remain legally sustainable.

Ratio Decidendi: A taxing entry covering specified petroleum products followed by "and others", coupled with express exclusions, includes other petroleum products of the same class; Hydraulic Oil used as a consumable and not as manufacturing raw material is consequently taxable.

Issues: Whether the supplier contravened the anti-profiteering requirement by failing to pass on an additional input tax credit benefit to the applicant following implementation of GST.

Analysis: Section 171 requires any benefit arising from a tax-rate reduction or input tax credit to be passed on through a commensurate price reduction. The project-specific, chartered-accountant-certified data was accepted because consolidated returns and financial records for multiple projects could not feasibly be bifurcated further. The input-tax-credit-to-purchase-value ratio fell from 8.26% in the pre-GST period to 7.87% in the post-GST period, showing that no additional GST input tax credit accrued. The transitional VAT credit passed to eligible purchasers did not relate to the applicant, whose agreement was executed after GST implementation and whose pre-GST advance VAT was deposited with the VAT department.

Conclusion: No additional input tax credit benefit accrued in respect of the relevant transaction; consequently, there was no contravention of Section 171 of the Central Goods and Services Tax Act, 2017.

Issues: (i) Whether the confirmed differential customs duty and interest on gold and silver found short were sustainable; (ii) Whether penalties on the proprietorship concern and its supervising individual were sustainable where the shortage resulted from theft and there was no evidence of intentional diversion; (iii) Whether penalty on the individual alleged to have removed the goods could rest on untested statements and an unverified police recovery; (iv) Whether a separate penalty could be imposed on the proprietor when penalty had been imposed on the proprietorship concern.

Issue (i): Whether the confirmed differential customs duty and interest on gold and silver found short were sustainable.

Analysis: The duty-free goods were found short during stock verification, and the duty liability with interest had been voluntarily paid and appropriated. The payment did not establish intentional diversion for penalty purposes, but the shortage supported retention of the duty and interest demand.

Conclusion: The differential customs duty and applicable interest were upheld against the assessee.

Issue (ii): Whether penalties on the proprietorship concern and its supervising individual were sustainable where the shortage resulted from theft and there was no evidence of intentional diversion.

Analysis: The shortage was reported by the unit itself, which sought customs stock verification after reporting theft. The record did not establish intentional diversion or an intent to evade duty, and the duty and interest had been paid, leaving no revenue loss.

Conclusion: The penalties on the proprietorship concern and its supervising individual were set aside in favour of the assessee.

Issue (iii): Whether penalty on the individual alleged to have removed the goods could rest on untested statements and an unverified police recovery.

Analysis: The relied-upon statement makers did not appear despite summons for cross-examination. The requirements of Section 138B for relying on those statements were not met, and no independent evidence corroborated them. The police recovery of silver was not identified or matched with the goods found short, while no gold was recovered; the theft complaint was also closed after reconciliation.

Conclusion: The alleged involvement was not conclusively established, and the penalty on the individual was set aside in favour of the assessee.

Issue (iv): Whether a separate penalty could be imposed on the proprietor when penalty had been imposed on the proprietorship concern.

Analysis: A proprietorship concern and its proprietor are not distinct legal persons for this purpose. Once penalty had been imposed on the proprietorship concern, an additional separate penalty on its proprietor was impermissible.

Conclusion: The separate penalty on the proprietor was set aside in favour of the assessee.

Final Conclusion: The duty consequence of the stock shortage remains, but the penal consequences fail for want of proof of deliberate diversion and, in the proprietor's case, because of the identity of the proprietorship concern and proprietor.

Ratio Decidendi: Penalty for shortage of duty-free goods requires reliable evidence of deliberate diversion; untested statements not admissible under the statutory safeguards and uncorroborated recovery cannot establish such liability, and a proprietor cannot be separately penalised where the proprietorship concern has been penalised.

Issues: (i) Whether the seizure of the gold and diamond jewellery was validly founded on reasonable belief of smuggling; (ii) Whether the burden of proving non-smuggled character shifted under Section 123; (iii) Whether the investigation statements could sustain confiscation and penalties without compliance with the statutory evidentiary requirements; (iv) Whether confiscation of the gold, diamond jewellery and cash, and the connected penalties, was sustainable.

Issue (i): Whether the seizure of the gold and diamond jewellery was validly founded on reasonable belief of smuggling.

Analysis: The seized ornaments and diamonds bore no foreign markings, were recovered inland rather than at a border, port, airport or notified customs area, and lacked material independently establishing foreign origin. A general suspicion that foreign markings may have been removed could not constitute particularised reasonable belief based on material existing before seizure.

Conclusion: The seizure was invalid for want of reasonable belief that the goods were smuggled, in favour of the assessee.

Issue (ii): Whether the burden of proving non-smuggled character shifted under Section 123.

Analysis: The statutory burden could arise only upon prima facie material establishing foreign origin. The absence of foreign markings, supporting forensic or documentary material, and valid reasonable belief meant that the Department remained responsible for proving the alleged smuggled character of the goods.

Conclusion: Section 123 was inapplicable and the burden did not shift to the assessee, in favour of the assessee.

Issue (iii): Whether the investigation statements could sustain confiscation and penalties without compliance with the statutory evidentiary requirements.

Analysis: The prescribed conditions for treating investigation statements as relevant evidence were not shown to have been fulfilled. The statements remained untested and substantially uncorroborated by independent evidence; consequently, they could not have decisive evidentiary value for confiscation or penalties.

Conclusion: The statements could not lawfully be the sole basis for confiscation or penalties, in favour of the assessee.

Issue (iv): Whether confiscation of the gold, diamond jewellery and cash, and the connected penalties, was sustainable.

Analysis: No importation, attempted importation, foreign origin, or applicable statutory prohibition was proved. The invoices supporting domestic procurement were available on the GST portal and their genuineness was not disputed. There was also no evidence that the seized cash represented sale proceeds of smuggled gold.

Conclusion: The confiscation of the goods and cash, and the penalties, were unsustainable, in favour of the assessee.

Final Conclusion: The appellate order vacating the confiscation, directing release of the cash, and setting aside penalties was legally maintained.

Ratio Decidendi: In an inland seizure of unmarked gold or jewellery, reasonable belief and prima facie proof of foreign origin are essential before the statutory burden can shift; uncorroborated investigation statements not validly admitted cannot establish smuggling or sustain confiscation.

Issues: (i) Whether the appeals were barred by limitation where one appeal was initially filed before the wrong customs office and the other was filed by e-mail within the prescribed period, with the physical copy received later; (ii) Whether refund of excess customs duty paid under protest was available in respect of finally assessed Bills of Entry despite no appeal having been filed against those assessments.

Issue (i): Whether the appeals were barred by limitation where one appeal was initially filed before the wrong customs office and the other was filed by e-mail within the prescribed period, with the physical copy received later.

Analysis: The appeal in the first matter had been filed within time but was lodged with the Commissioner of Customs rather than the Commissioner (Appeals). The period during which it remained before the wrong office was liable to exclusion under Section 14 of the Limitation Act, 1963, particularly as the receiving office neither transferred nor promptly returned it. In the second matter, the appeal was filed by e-mail on the last permissible date and the hard copy was dispatched the same day. In any event, the five-day delay recorded on receipt of the physical copy was within the condonable period.

Conclusion: The appeals were not barred by limitation, or alternatively the delay was liable to be excluded or condoned, in favour of the assessee.

Issue (ii): Whether refund of excess customs duty paid under protest was available in respect of finally assessed Bills of Entry despite no appeal having been filed against those assessments.

Analysis: The Bills of Entry concerned had been finally assessed under the classification declared by the assessee, while duty at the higher rate had been paid under protest. Since Revenue neither appealed against those completed assessments nor initiated proceedings to alter the classification, the assessee was not required to challenge assessments that accorded with its own declaration. A refund proceeding cannot reopen a concluded assessment; however, the final assessments here supported the refund claim. Each Bill of Entry constitutes a separate assessment, and pending disputes regarding other Bills of Entry could not postpone or defeat refund relating to the independently finalised Bills of Entry. The protest had not been vacated by Revenue.

Conclusion: Refund of excess duty paid under protest was available for the 73 finally assessed Bills of Entry, in favour of the assessee; no refund was granted in respect of the provisionally assessed Bills of Entry.

Final Conclusion: The classification merits in the first matter require consideration by the appellate authority, while the refund claim is enforceable only to the extent attributable to completed assessments and excess duty paid under protest.

Ratio Decidendi: An importer need not challenge a final assessment that accepts its declared classification in order to obtain refund of excess duty paid under protest; each finally assessed Bill of Entry is independently determinative unless Revenue lawfully reopens or challenges it.

Issues: (i) Whether sale of securities by persons admittedly in possession of unpublished price sensitive information constitutes insider trading under Regulation 4(1) of the 2015 PIT Regulations notwithstanding the stated use of sale proceeds or absence of profit; (ii) Whether disgorgement of loss averted and penalties for breach of the code of conduct were sustainable; (iii) Whether the penalty imposed on the first respondent under Section 15G required modification.

Issue (i): Whether sale of securities by persons admittedly in possession of unpublished price sensitive information constitutes insider trading under Regulation 4(1) of the 2015 PIT Regulations notwithstanding the stated use of sale proceeds or absence of profit.

Analysis: Regulation 4(1) creates a presumption that trades by a person possessing unpublished price sensitive information are motivated by that information. Its note makes the purpose of trading and use of proceeds irrelevant once possession of such information and trading are established, unless the insider proves innocence through the specified or analogous exonerating circumstances. The respondents admittedly possessed the information and sold substantial or entire shareholdings during the relevant period, without bringing their transactions within any defence. The word "including" makes the stated defences non-exhaustive, but any additional defence must be of a similar nature; it cannot encompass a legitimate corporate-purpose defence excluded by the 2015 regulatory scheme. The position under the predecessor 1992 regulations did not govern the transactions.

Conclusion: The respondents committed insider trading; this issue is in favour of the appellant.

Issue (ii): Whether disgorgement of loss averted and penalties for breach of the code of conduct were sustainable.

Analysis: The respondents' insider trading resulted in avoidance of losses. The statutory power to issue directions includes disgorgement equivalent to wrongful gain or loss averted through contravention. The findings supporting the code-of-conduct penalties were also sustained.

Conclusion: Disgorgement of the loss averted and the penalties for breach of the code of conduct are valid; this issue is in favour of the appellant.

Issue (iii): Whether the penalty imposed on the first respondent under Section 15G required modification.

Analysis: Applying the statutory factors and the cumulative facts and circumstances, the penalty of Rs. 25 lakh imposed on the first respondent was considered excessive.

Conclusion: The first respondent's Section 15G penalty is reduced to Rs. 10 lakh; this issue is in favour of the first respondent.

Final Conclusion: The statutory prohibition is attracted by trading while in possession of unpublished price sensitive information, subject only to proof of a recognised exonerating circumstance. The order imposing market-access restraints, disgorgement, and code-of-conduct penalties is reinstated, with a reduced insider-trading penalty for the first respondent.

Ratio Decidendi: Under Regulation 4(1) of the 2015 PIT Regulations, trading by a person in possession of unpublished price sensitive information is presumed motivated by that information, and the trader's purpose or application of proceeds cannot rebut the prohibition unless an applicable exonerating circumstance is established.

Issues: Whether interference with the High Court's interim order was warranted while the substantive writ petitions remained pending.

Analysis: The High Court's interim arrangement was found to be balanced and to adequately protect the interests of the parties. Merits were not addressed because they remained for determination in the pending writ proceedings.

Outcome: The Special Leave Petitions were disposed of without interference with the impugned interim order.

Issues: (i) Whether works contract services for repair and painting of Mandi Samiti shops were exempt under Entry No. 60 of Notification No. 25/2012-ST dated 20.06.2012; (ii) Whether the extended limitation period could sustain the service-tax demand and consequential interest and penalty; (iii) Whether rental receipts qualified for threshold exemption.

Issue (i): Whether works contract services for repair and painting of Mandi Samiti shops were exempt under Entry No. 60 of Notification No. 25/2012-ST dated 20.06.2012.

Analysis: The recipient entities, constituted under State legislation, were accepted as governmental authorities. Entry No. 60 exempts services by a governmental authority in relation to functions entrusted to a Panchayat under Article 243G of the Constitution of India. Facilitating marketing of agricultural produce was found to be connected with agriculture and agricultural extension, a Panchayat function under the Eleventh Schedule. A legal claim to exemption could be raised before the Tribunal notwithstanding that it had not been raised under that entry before the lower authorities.

Conclusion: The works contract services were exempt under Entry No. 60 of Notification No. 25/2012-ST dated 20.06.2012, in favour of the assessee.

Issue (ii): Whether the extended limitation period could sustain the service-tax demand and consequential interest and penalty.

Analysis: The dispute turned on interpretation of the exemption notification. The assessee had regularly filed ST-3 returns, and the record contained no evidence establishing fraud, collusion, wilful misstatement, or suppression with intent to evade tax. As the notice for the 2016-17 period invoked only the extended period, the demand could not be sustained on limitation.

Conclusion: The demand was barred by limitation; consequential interest and penalties were unsustainable, in favour of the assessee.

Issue (iii): Whether rental receipts qualified for threshold exemption.

Analysis: The only taxable value for the relevant financial year was the rental receipt of Rs. 2,70,000, since the other receipts were exempt and could not be included in computing taxable value. The taxable value was below the threshold of Rs. 10 lakh.

Conclusion: The rental-service demand was covered by threshold exemption and was unsustainable, in favour of the assessee.

Final Conclusion: The service-tax liabilities on the works contract and rental receipts, together with the associated interest and penalties, were set aside.

Ratio Decidendi: Services connected with agricultural-produce marketing, rendered by a governmental authority in relation to Panchayat functions under Article 243G, qualify for exemption under Entry No. 60; an extended limitation period requires proof of suppression or other specified conduct with intent to evade tax.