TaxTMI Updates e-Newsletter
Aug 08,2026

Non-adjudication of representations concerning interest on self-assessed tax - Garnishee recovery pending determination of disputed interest liability

Non-adjudication of representations concerning interest on self-assessed tax - Garnishee recovery pending determination of disputed interest liability - Sustainability of garnishee recovery for interest on self-assessed tax when the assessee's representations concerning adjustment of amounts in the Electronic Cash Ledger remained undecided. - HELD THAT: - The Court noted that judicial decisions reflected conflicting views on whether interest on self-assessed tax is subject to adjustment or deduction for amounts available in the Electronic Cash Ledger. As the representations raising that controversy had admittedly not been decided, the Court did not adjudicate the merits and held that they should first be determined by a reasoned order in accordance with law and applicable judicial pronouncements. [Paras 12, 13]

The representations were directed to be decided within the stipulated period; no precipitative action pursuant to the garnishee notices may be taken until the decision is communicated, and any adverse decision shall remain inoperative for a further three weeks.

Final Conclusion: The petition was disposed of without deciding the merits of the disputed interest liability. The competent respondent was directed to determine the pending representations by a reasoned order, while coercive action under the garnishee notices was restrained pending that determination.

Authorisation for GST inspection, search and seizure - Document Identification Number in search authorisation - Voluntary payment of GST during search

Distinct statutory powers of inspection, search and seizure - Reasons to believe for GST search - Document Identification Number in search authorisation - Validity of the authorisation and search of the jewellery business premises under the GST inspection, search and seizure provisions - HELD THAT: - Inspection, search and seizure are conceptually distinct powers; an authorisation must specifically disclose the power conferred and cannot mechanically reproduce statutory alternatives. Exercise of the power requires recorded reasons to believe and remains amenable to judicial review. Display of DIN is mandatory; an officer invoking the exceptional dispensation for non-generation must contemporaneously record the precise technical difficulty and establish entitlement to the exception. DIN generated subsequently within the stipulated period must also be shared with the noticee to enable verification of the communication. The impugned warrant was unclear and the asserted technical difficulty was unsupported by contemporaneous record, while the subsequently generated DIN was not disclosed. Nevertheless, the petitioner, having earlier obtained release of the seized goods on the basis that applicable tax had been paid, could not subsequently nullify the antecedent inspection or search.

The direction issued in M/s.Bhumi Associates [2021 (2) TMI 701 - GUJARAT HIGH COURT] is that the assessee must be advised to make payment towards liability after the search is concluded.[Paras 14, 15, 17, 18, 38]

The search was found not to conform to the prescribed safeguards, but its validity was not annulled in view of the petitioner's earlier availing of provisional release of the goods.

Voluntary payment under the GST demand provision - Refund of tax collected during search - Self-ascertainment of tax liability - Entitlement to refund of tax and penalty paid during the search of the jewellery business premises - HELD THAT: - Tax cannot be recovered during search before statutory adjudication; payment before notice is permissible only as a genuinely voluntary payment. To establish voluntariness, payment must follow the assessee's written self-ascertainment of liability, communicated to the proper officer, and be acknowledged in the prescribed form. The assessee must also be informed in writing of the statutory option to secure provisional release of seized goods by bond and security. A payment not conforming to these safeguards is involuntary and may found a refund claim. The payment here was held involuntary, and collection of full penalty was also inconsistent with the provision governing pre-notice payment. However, since the petitioner had secured release of the goods by representing that tax and penalty stood paid, refund was directed to abide by fresh assessment proceedings. [Paras 32, 33, 35, 38, 39]

Directions: a) The respondents are directed to initiate fresh assessment proceedings with regard to the subject matter of the writ petition alone. The period from 15.08.2023, till the date of receipt of certified copy of this order shall be excluded for the purpose of limitation.

b) The petitioner will be issued with notice and proper enquiry shall also be held by adhering to the time lines provided in the statute.

c) Whether the amount in question should be refunded to the petitioner or not will abide by the outcome of such assessment proceedings.

Final Conclusion: The writ petition was disposed of by directing fresh assessment confined to the subject matter of the petition, after notice and enquiry. The question of refund of the amount paid during search was left to abide by the outcome of that assessment.

Retention of seized documents following withdrawal of search authorisation - Dependent orders and acts

Entitlement of the GST authorities to retain files and documents taken during an inspection after withdrawal of the authorisation under which the inspection was conducted - HELD THAT: - The power to seize and retain documents under section 67 is founded upon a valid authorisation for seizure. Sections 67(2) and 67(11) must be read together: retention is permissible only where seizure was effected by a duly authorised official and remains necessary for proceedings under the Act. Having withdrawn the authorisation and thereby precluded adjudication of its validity, the authorities could not retain the fruits of the inspection; the foundation for seizure and consequential retention had ceased. [Paras 5, 7]

The authorities were directed to return all files and documents obtained during the inspection immediately; the statement recorded on that date was held incapable of carrying legal consequence.

Final Conclusion: The writ petition was allowed, and the GST authorities were directed to return the files and documents taken during the inspection conducted under the subsequently withdrawn authorisation.

Alternative statutory remedy and writ jurisdiction - Exception to exhaustion of appellate remedy on grounds of natural justice

Maintainability of writ petition against appealable GST adjudication order - Natural justice challenge without particulars of prejudice - Maintainability of a writ petition challenging an appealable GST adjudication order on the ground that relied-upon documents were not supplied - HELD THAT: - Where an efficacious statutory appeal is available, writ jurisdiction is not to be exercised unless an exceptional case is established through proper pleadings and supporting material.

We find it pertinent to note that, there is a growing tendency in matters before us, to surpass the appellate statutory remedy by directly approaching the Writ Court. It is possible that such recourse is at times, taken routinely, without the gravitas it would so warrant, with a view to circumvent the mandatory pre-deposit under the statute. In this context, we are fortified by similar observations made by the co-ordinate Bench of this Court in Ascensia Diabetes Care India Pvt. Ltd. Vs. Union of India [2026 (4) TMI 1333 - BOMBAY HIGH COURT] and Nikhil Garg S/o Vishnu Prasad Garg [2025 (12) TMI 142 - BOMBAY HIGH COURT]

The allegation of denial of relied-upon documents was unsupported by particulars identifying the documents withheld or the resulting prejudice; the adjudication order recorded that the show cause notice and relied-upon documents had been furnished through the registered and other email addresses. A bare invocation of natural justice could not displace the statutory appellate remedy. [Paras 14, 15, 16, 17, 18, 19]

The writ petition was held not maintainable; liberty was granted to pursue the statutory appeal, subject to compliance with statutory requirements, and the merits were left open.

Final Conclusion: The writ petition was disposed of as not maintainable in view of the available statutory appellate remedy. The petitioner was granted liberty to file an appeal within the stipulated period, subject to statutory compliance.

Rectification of the order u/s 161 of the Telangana Goods and Services Tax Act - question of variation in turnovers in GSTR-3B when compared to GSTR-8 as the petitioner’s e-commerce providers have categorically submitted that technical issue persisted with the GST Portal

HELD THAT:- The writ petition was disposed of with liberty to seek rectification before the Proper Officer, which was directed to be considered in accordance with law after an opportunity of hearing.

Restoration of cancelled GST registration - Change in declared principal place of business

Whether cancellation of GST registration for non-existence at the declared principal place of business should be restored where the address discrepancy resulted from a genuine mistake and no GST demand was outstanding? - HELD THAT: - The fundamental basis for cancellation was the altered registered address. The Court accepted that the asserted address discrepancy was not intended to circumvent the law, noted that no GST demand was outstanding, and considered the undertaking to pay applicable charges, late fees and penalty. Restoration would enable the assessee to conduct business lawfully while causing no prejudice to the Revenue. [Paras 13, 14, 15]

The cancelled GST registration was directed to be restored upon payment of the applicable charges, late fees and penalty intimated by the respondents.

Final Conclusion: The petition was disposed of by directing restoration of the GST registration, conditional upon payment of the applicable charges, late fees and penalty.

Interest on delayed refund pursuant to appellate order

Claim for interest on refund released pursuant to an appellate order allowing the refund claim - HELD THAT: - Section 56 of the CGST Act provides for interest where a refund ordered under Section 54(5) is not made within sixty days of receipt of the refund application. Its proviso covers a refund arising from a final order of an Adjudicating Authority, Appellate Authority, Appellate Tribunal or Court, where the consequent refund application is not acted upon within sixty days. [Paras 5, 6, 7]

The petitioner was permitted to approach the competent authority for interest under Section 56 of the CGST Act, which shall consider and decide the application in accordance with law.

Final Conclusion: The writ petition was disposed of with liberty to seek statutory interest on the delayed refund from the competent authority.

Alternative statutory remedy in GST disputes - Writ jurisdiction and disputed questions of fact - Alleged bias arising from authorisation of inspection

Maintainability of the writ petition against the GST demand where the statutory appellate remedy before the GST Appellate Tribunal was available and the controversy required factual examination - HELD THAT: - The MGST/CGST enactments provide a self-contained appellate mechanism. Writ jurisdiction is discretionary and ordinarily cannot be invoked to bypass the statutory forum, particularly where the dispute turns upon factual matters requiring examination of evidence. Whether the seized notepads and cash memos evidenced suppressed sales or were merely estimates, the applicable GST rate, and reconciliation of bank deposits and GSTR-3B returns with the seized material were factual questions unsuitable for determination under Article 226. Thansingh Nathmal vs. A. Mazid, Superintendent of Taxes [1964 (2) TMI 79 - SUPREME COURT] was applied; M/s Jorabat Shillong Expressway Ltd., vs. Union of India [2026 (6) TMI 253 - MEGHALAYA HIGH COURT] was referred to.

Godrej Sara Lee Ltd. vs. Excise and Taxation Officer-cum-Assessing Authorities & Ors. [2023 (2) TMI 64 - SUPREME COURT] and Principal Commissioner Income Tax, Shillong vs. M/s NEEPCO [2024 (7) TMI 590 - MEGHALAYA HIGH COURT] were distinguished as the present case did not involve a pure question of law. [Paras 12, 13, 14, 15, 16]

The writ petition was not entertained, the petitioner being left to pursue the statutory appeal before the GST Appellate Tribunal.

Alleged bias arising from authorisation of inspection - Proper Officer under GST law - Alleged denial of natural justice and lack of authority on the ground that the officer who authorised the inspection subsequently acted as the appellate authority - HELD THAT: - Authorisation of an inspection was held distinct from adjudicatory functioning. No material was produced to establish bias, and the actions taken by officers empowered as Proper Officers under the statutory scheme could not be treated as irregular or illegal. Consequently, no breach of natural justice or jurisdictional error was made out. [Paras 14, 16]

The challenge founded on bias, denial of natural justice and lack of authority was rejected.

Final Conclusion: The writ petition challenging the GST demand was dismissed as the dispute involved contested facts and no jurisdictional error, denial of natural justice or pure question of law was established. The petitioner was permitted to pursue the statutory appellate remedy, with any delay to be favourably considered by the Tribunal.

Consolidated show cause notice for multiple financial years - Factual foundation for proceedings involving fraud, wilful misstatement or suppression - Exclusion of time for adjudication after writ proceedings

Consolidated show cause notice for multiple financial years - Validity of a consolidated demand-cum-show cause notice covering four financial years under the CGST Act. - HELD THAT: - There is no statutory bar to issuance of a consolidated show cause notice, or to passing a consolidated order, for different financial years under either the ordinary demand provision or the provision applicable where fraud, wilful misstatement or suppression is alleged. The jurisdictional objection stood concluded by the earlier decision of the Court. [Paras 7]

The challenge to the consolidated show cause notice was not entertained.

Factual foundation for proceedings involving fraud, wilful misstatement or suppression - Exercise of writ jurisdiction against show cause notice - Appropriateness of initiating proceedings under the provision applicable to fraud, wilful misstatement or suppression rather than the ordinary demand provision. - HELD THAT: - The choice between the two provisions depends upon factual adjudication, including whether there was fraud, wilful misstatement or suppression of facts to evade tax. Such questions cannot be determined in writ jurisdiction at the show cause notice stage and may be raised before the Proper Officer and, thereafter, before the statutory appellate forums. [Paras 10, 11, 12]

The petitioners were relegated to submit their reply and pursue the statutory remedies.

Exclusion of time for adjudication after writ proceedings - Computation of the period available for adjudication after granting the petitioners a fresh opportunity to reply to the demand-cum-show cause notice. - HELD THAT: - As the petitioners had not replied to the notice and were being afforded a fresh opportunity to do so, the Court restored the position to the stage of issuance of the notice. To balance equities, the period from 18.04.2024 until the judgment was directed to be excluded in computing the time available to the authorities for adjudication. [Paras 14, 15]

The petitioners were granted 30 days to reply, and the specified period was excluded for adjudication limitation.

Final Conclusion: The writ petition was disposed of without adjudicating the factual challenge to invocation of the provision applicable to fraud, wilful misstatement or suppression. The petitioners were permitted to file their reply, subject to exclusion of the period directed by the Court for completion of adjudication.

Payment of admitted GST liability in instalments - seeking payment of the liability in 12 instalments - HELD THAT: - The petitioner did not dispute the liability and sought only permission to discharge it in instalments. As the power to permit instalment payment of admitted liability is exercisable by the Commissioner of State Tax, the petitioner was required to approach the competent authority for consideration of its request in accordance with law. [Paras 5]

Liberty was granted to apply to the competent authority/Commissioner of State Tax, who was directed to consider the application in accordance with law within the stipulated period.

Final Conclusion: The writ petition was disposed of by permitting the petitioner to seek instalment payment of the admitted liability from the competent authority.

Ex parte order rejecting the refund application - Violation of principles of natural justice in refund adjudication - Non considering the reply to the show-cause notice and without affording an opportunity of hearing

HELD THAT: - The refund-rejection order was passed ex parte without considering the petitioner's reply to the show-cause notice. Since the petitioner was consequently denied a reasonable opportunity to present its case, the order was held to be contrary to the principles of natural justice. The merits of the refund claim were left open. [Paras 5, 6]

The impugned refund-rejection order was quashed, and the matter was remanded for fresh adjudication from the stage of the reply, after fresh notice, hearing and a reasoned order in accordance with law.

Final Conclusion: The petition was disposed of by setting aside the ex parte refund-rejection order and directing fresh adjudication after affording the petitioner an opportunity of hearing. The merits were not adjudicated.

Condonation of delay in GST appeal - delay of four days beyond the condonable period for filing the statutory appeal

HELD THAT: - Although the appeal was filed four days beyond the aggregate period of three months and the further condonable period of one month prescribed under Section 107, the order under challenge determined valuable rights of the petitioner.

Following M/s Air Cure Solutions Vs. The Assistant Commissioner, Commercial Taxes [2026 (6) TMI 1502 - KARNATAKA HIGH COURT] the Court considered it expedient to grant relief. [Paras 4]

The appellate order dismissing the appeal as time-barred was set aside; the delay was condoned and the appeal was restored for adjudication on merits, with all contentions kept open.

Final Conclusion: The writ petition was allowed, the dismissal of the GST appeal on limitation was set aside, and the appeal was restored for decision on merits after condoning the delay.

Interest on delayed GST refunds - Chartered Accountant certification for refund claims

Interest on delayed GST refunds - Chartered Accountant certification for refund claims - Requirement of certification under Rule 89(2)(m) of the CGST Rules for a claim of interest on refund amounts already sanctioned and disbursed. - HELD THAT: - The claim was confined to interest on principal refund amounts already sanctioned pursuant to the relevant original or appellate orders. Since the interest component could not have been passed on to an end consumer, certification that its incidence had not been passed on to another person was not required for scrutiny of the claim. [Paras 11]

The Proper Officer was directed to scrutinise and decide the interest claim in accordance with law, without insisting on certification under Rule 89(2)(m) of the CGST Rules.

Final Conclusion: The writ petitions were disposed of with directions for production and scrutiny of the refund particulars and for a decision on the claimed interest within the stipulated period, without requiring the certification under Rule 89(2)(m).

Statutory appellate remedy against the impugned GST adjudication order - HELD THAT:- The writ petition was disposed of with liberty to file a statutory appeal, accompanied by the prescribed pre-deposit and an application for condonation of delay.

Ex parte GST assessment - non-consideration of tax payment - Remand subject to pre-deposit and verification of tax paid

Whether the ex parte assessment and rejection of the delayed statutory appeal warranted reconsideration where the assessee asserted that the disputed tax had already been paid but such payment had not been captured? - HELD THAT: - The assessment was made ex parte without a reply from the petitioner. Recording the petitioner's statement that the disputed tax had been paid, though such payment was not reflected in the assessment order, the Court considered it appropriate to restore the matter for fresh adjudication, subject to verification of the amount already paid. [Paras 7, 9, 10]

The assessment order and the appellate order rejecting the belated appeal on limitation were quashed, and the matter was remitted for a fresh order on merits, conditional upon deposit of 15% of the disputed tax from the Electronic Credit Ledger and filing of a reply with supporting documents.

Final Conclusion: The writ petition was disposed of by remitting the assessment for fresh adjudication subject to the stipulated pre-deposit, verification of payments, and opportunity to file a reply. Amounts paid were directed to be adjusted towards interest liability, if applicable.

Rejection of the petitioner's candidature for appointment as Member (Accountant), ITAT, by the Search-cum-Selection Committee - Reasonable apprehension of bias in selection proceedings - Natural justice in Search-cum-Selection Committee process

Validity of the rejection of candidature for appointment as Member (Accountant), ITAT, by a Search-cum-Selection Committee which included an officer who had earlier faced contempt proceedings instituted by the candidate in relation to the same appointment dispute - HELD THAT: - The participation of that officer in the selection process created a genuine and reasonable apprehension of bias, particularly in the context of the uncontroverted allegations of sustained departmental obstruction and the earlier setting aside of the petitioner's compulsory retirement.

Actual bias need not be established; the reasonable perception that the officer's impartiality and independence were compromised was sufficient to render the decision-making process vulnerable for violation of natural justice. The officer ought to have recused, and his participation vitiated the Committee's decision insofar as it concerned the petitioner.

The rule of law constitutes the foundation of a well-governed society, and the shadow of bias or mala fides in the exercise of power concerning public functions strikes at the very root of a regulated social order. The law relating to mala fide exercise of power has been the subject matter of discussion in a catena of decisions of this Court. (Pratap Singh v. State of Punjab [1963 (9) TMI 59 - SUPREME COURT], Jaichand Lal Sethia v. State of W.B. [1966 (7) TMI 78 - SUPREME COURT (LB)], E.P. Royappa v. State of Tamil Nadu [1973 (11) TMI 80 - SUPREME COURT]). It has been consistently held that where statutory or administrative power is exercised for purposes extraneous to those for which it is conferred, or is influenced by irrelevant considerations, or is actuated by malice in law, such exercise cannot be sustained. Judicial review in such circumstances is directed not merely at the decision but at the decision-making process itself.

Further, in the absence of any counter affidavit on behalf of the respondents, the averments made in the writ petition have remained uncontroverted. In such circumstances, this Court is constrained to proceed on the basis that all relevant facets of the case may not have been placed before the SCSC at the time when the petitioner’s candidature was considered. There is a genuine possibility that the fact of “the Officer” having earlier faced contempt proceedings at the instance of the petitioner was not brought to the notice of the Committee. In the interest of fairness and to dispel any reasonable apprehension of bias, it would have been appropriate for “the Officer” to have recused from the evaluation process on his own. His failure to do so fortifies the aspersion of bias.[Paras 41, 44, 45, 46]

The minutes rejecting the petitioner's candidature were set aside, and a freshly constituted Search-cum-Selection Committee, excluding the concerned officer, was directed to reconsider the candidature and communicate its outcome within the stipulated period.

Final Conclusion: The writ petition was disposed of by setting aside the rejection of candidature and directing fresh consideration by a reconstituted Search-cum-Selection Committee excluding the concerned officer. Costs were imposed on the respondents.

Reliance on District Valuation Officer's report after rejection of books of account - valuation to be made by reference to State PWD rates rather than CPWD rates - Commissioner of Income Tax (Appeal) faulted the method of valuation by the District Valuation Officer but not the procedure seeking valuation by District Valuation Officer

HELD THAT:- Special Leave Petition dismissed; the Court declined to interfere with the impugned High Court judgment and order [2026 (3) TMI 714 - MADRAS HIGH COURT]

Allowability of provision for discount - allowable expense or not? - HELD THAT:- In view of the peculiar facts and circumstances obtained in the instant case, we are not inclined to entertain this petition. The special leave petition, is accordingly, dismissed.

Question of law, if any, is kept open. HC order [2025 (10) TMI 230 - KARNATAKA HIGH COURT].

Capital gains versus business income - sale of investment flats - Consistency in tax treatment - Taxability of proceeds from sale of flats in a single real-estate project - HELD THAT: - We are of the view that though the treatment given by the Respondent-Assessee in its books of accounts would not be the only determinative factor in coming to a conclusion that whether the income has to be taxed under the head ‘Business Income’ or ‘Capital Gains’, however, it is an important factor which has to be borne in mind while deciding the treatment of income which had arisen in the hands of the Respondent-Assessee. Our this view is fortified by the decision of this court in Karam Chand Thapar and Bros. (P.) Ltd. [1971 (8) TMI 29 - SUPREME COURT] where Court held that the circumstances were more consistent with the fact that those shares were investment shares, and that since the shares in question were shown as investment shares in the books as well as in the balance-sheet of the Appellant-Assessse, the loss incurred on the selling of these shares was in fact a capital loss.

The character of the transaction depended primarily on the assessee's intention, assessed from the totality of circumstances, including the objects in its memorandum, consistent treatment of the land and building as investments, prolonged holding, engagement of a broker for leasing, absence of other real-estate projects, and lack of volume, frequency, continuity or regularity in purchase and sale.

The sale of flats over different years, after failure to secure tenants, did not establish an adventure in the nature of trade. Though accounting treatment is not conclusive, it is a relevant circumstance. Further, the Revenue had accepted the same treatment in earlier assessments and, absent distinguishing facts or incriminating material in the relevant year, could not adopt a contrary position; consistency is required where the fundamental factual position remains unchanged.

Though there have been instances where courts have taken a view that a single solitary transaction also can be considered as a business transaction, and hence treated income therefrom as ‘Business Income’, but in the facts of the present case, in our respectful view, the other determinative factors like volume, frequency, the length of the time for which the Respondent-Assessee held the asset, and also the fact that the Respondent-Assessee had treated the asset as an investment in the books of account, and the ‘Objects’ clause in the MOA as given by the Respondent-Assessee, clearly go to establish the fact that the intention of the Respondent-Assessee was never to carry on business.

Our view gets fortified by the following decisions of this court in Administrator of the Estate of Shri E.F. Dinshaw [2012 (5) TMI 136 - BOMBAY HIGH COURT] and M/s. Shree Shreemal Builders [2018 (7) TMI 2394 - BOMBAY HIGH COURT] and the decision of Arun Majeed [2024 (7) TMI 1496 - KERALA HIGH COURT] which are discussed below.[Paras 9, 11, 12, 13, 14, 15]

The proceeds from sale of the flats were rightly assessable as capital gains and not as business income.

Final Conclusion: No substantial question of law arose from the Tribunal's order. The Revenue's appeal was dismissed.

Government grant constituting income or not ? -Interest liability on unspent government grant - Depreciation on block of assets

Government grant constituting income or not - Taxability of the unspent Government grant received for implementation of the micro-irrigation scheme - HELD THAT: - The question was covered by earlier decisions of the Court Gujarat State Disaster Management Authority [2014 (2) TMI 789 - GUJARAT HIGH COURT] relying upon the decision of this Court in case of Gujarat Municipal Finance Board [1996 (5) TMI 71 - GUJARAT HIGH COURT] as well as Gujarat Safai Kamdar Vikas Nigam [2011 (5) TMI 815 - GUJARAT HIGH COURT] holding that a Government grant provided for specified purposes, with restrictions on its utilisation, does not constitute the recipient's income. [Paras 8]

Deletion of the addition on account of unspent grant was upheld.

Interest liability on unspent government grant - Allowability of the interest liability arising on the unutilised Government grant - HELD THAT: - The Court held that the issue stood concluded in favour of the assessee by its earlier decision Gujarat Informatics Ltd. [2013 (7) TMI 764 - GUJARAT HIGH COURT] concerning interest payable on unspent grant under the governing Government resolutions. [Paras 9]

Deletion of the addition relating to interest on unspent grant was upheld.

Depreciation on block of assets - Depreciation on assets retired from active use but forming part of a block of assets used for business. - HELD THAT: - Following the settled block-of-assets principle as held in Sonal Gum Industries [2009 (2) TMI 84 - GUJARAT HIGH COURT] the Court held that individual items in the block cannot be segregated to restrict depreciation where the assets are used for business; simultaneous use of every item is unnecessary. [Paras 12]

The disallowance of depreciation was deleted; the consequential question concerning reliance on the capital-gains provision was academic and was not answered.

Final Conclusion: No substantial question of law arose from the Tribunal's order. The revenue's appeal was dismissed.

Revision of assessment u/s 263 - Fresh consideration of revised return following demerger

Validity of the revisional order concerning assessment after demerger where the revised return had been filed before preparation of the revised audited balance sheet and profit and loss account - HELD THAT: - The Court found that the revisional order had been passed in haste to meet the statutory limitation period and suffered from non-application of mind. Although the revised return had been filed after sanction of the demerger scheme, it was filed before the audited balance sheet and profit and loss account reflecting the demerger were ready. The Court therefore did not adjudicate the merits of the proposed revision or the capital-gains issue, but directed fresh consideration upon a proper revised return founded on the revised audited financial statements. [Paras 30, 31, 32, 34]

The revisional order was set aside and the matter remitted for a de novo order after affording hearing to the petitioner, without any expression on the merits.

Final Conclusion: The writ petition was disposed of by setting aside the revisional order for non-application of mind and remitting the matter for fresh independent adjudication after filing of a proper revised return based on the revised audited financial statements.

Validity of reassessment proceedings - Limitation for reassessment notice under substituted regime - Exclusion of time under reassessment proceedings - surviving six-year period

CBDT instruction implementing deemed notice procedure - Validity of the instruction implementing the deemed-notice procedure mandated for reassessment notices issued under the old regime - HELD THAT: - The instruction was issued to implement the decision in Union of India Vs. Ashish Agarwal [2022 (5) TMI 240 - SUPREME COURT] under which notices issued under the old regime were to be treated as notices under Section 148A(b) of the substituted regime. Its challenge could not therefore be sustained. [Paras 7]

The challenge to the instruction was dismissed.

Limitation for reassessment notice under substituted regime - Exclusion of time under reassessment proceedings - Validity, on limitation, of the reassessment notice for Assessment Year 2015-2016 issued after proceedings initiated by a notice under the old regime. - HELD THAT: - The concession recorded in Union of India and others Vs. Rajeev Bansal [2024 (10) TMI 264 - SUPREME COURT (LB)] was not a declaration that every reassessment notice for Assessment Year 2015-2016 was barred. Where the alleged escaped income exceeded the prescribed threshold, the notice issued under the old regime remained within the six-year limitation.

Applying the legal fiction in Union of India Vs. Ashish Agarwal and the clarification in Rajeev Bansal, the period during which the deemed notice proceedings remained pending, the time allowed for reply, and the statutory time for passing the order under Section 148A(d) had to be excluded. Since no reply was furnished to the Section 148A(b) notice, the order under Section 148A(d) and the consequential Section 148 notice were issued within the surviving limitation period. [Paras 26, 28, 29, 30, 33]

The order under Section 148A(d) and the reassessment notice were held to be within time.

Final Conclusion: The writ petition was dismissed. The reassessment proceedings may be completed after affording the petitioner an opportunity to file its reply and participate in accordance with law.

Denial of deduction u/s 80IA - delay in filing Form 10CCB for claiming deduction - Substantive deduction deniable for procedural lapse - Rejection of condonation of delay in filing Form 10CCB for claiming deduction u/s 80-IA, despite the Chartered Accountant's admitted oversight - HELD THAT: - The Court held that a substantive benefit otherwise available under section 80-IA cannot be denied merely because of a procedural irregularity in uploading the audit report. The admitted failure of the Chartered Accountant to file Form 10CCB, coupled with the marginal delay in filing the return, warranted reconsideration of the claim on merits; the Revenue is required to collect due tax and not burden genuine taxpayers otherwise entitled to deduction. [Paras 10, 12]

The rejection order was quashed and the matter remitted for a fresh order on merits, with consequential directions for issuance of a fresh intimation or initiation of proceedings in accordance with law.

Final Conclusion: The writ petition was disposed of by quashing the rejection of condonation and remitting the claim for section 80-IA deduction for fresh consideration on merits.

Faceless reassessment - Jurisdiction of Jurisdictional Assessing Officer to issue reassessment notice - Validity of reassessment notice issued by the Jurisdictional Assessing Officer otherwise than through the algorithm-based random allocation contemplated for faceless assessment and reassessment - HELD THAT: - Following the Co-ordinate Bench decision SHARDA DEVI CHHAJER [2025 (3) TMI 1229 - RAJASTHAN HIGH COURT] the Court held that the mandate of section 151A requires adherence to the algorithm-based random allocation system. A Jurisdictional Assessing Officer lacks jurisdiction to issue a notice under section 148, since such manual exercise would defeat the statutory faceless regime. [Paras 5, 6]

The reassessment notice for Assessment Year 2021-22 and all consequential orders were quashed, with the observations and directions in the earlier decisions applied mutatis mutandis.

Final Conclusion: The writ petition was allowed and the impugned reassessment notice issued by the Jurisdictional Assessing Officer, together with consequential orders, was quashed for want of jurisdiction.

Finality of Settlement Commission orders - Limited judicial review of settlement orders

Challenge to the settlement of income on the ground that the Settlement Commission had not properly appreciated the evidence concerning alleged unaccounted transactions - HELD THAT: - An order of settlement is conclusive as to matters stated therein. In writ jurisdiction, the Court cannot reappreciate evidence assessed by the Settlement Commission unless the settlement suffers from procedural illegality, breach of natural justice or contravention of statutory provisions. As the Department alleged only inadequate appreciation of its evidence, without alleging any such defect, interference was unwarranted.

In view of law laid down by Courts including Hon’ble Supreme Court in ‘Jyotendra Sinhji Vs. S.I. Tripathy and Ors.” [1993 (4) TMI 1 - SUPREME COURT] no interference is warranted in the impugned order.[Paras 7]

The challenge to the settlement order was rejected and the writ petition was dismissed.

Final Conclusion: The writ petition was dismissed, the Court holding that the Department's challenge amounted only to a request for reappreciation of evidence underlying a conclusive settlement order.

Revision for non-initiation of penalty for under-reporting of income - Discretionary initiation of penalty proceedings

Validity of revision of the assessment order for failure to initiate penalty proceedings for alleged under-reporting of income arising from bogus contractual receipts and disallowance of tax deducted at source credit - HELD THAT: - The returned income had been accepted while the tax deducted at source credit relating to the contractual receipts was disallowed. Since the tax deducted at source amount was already included in the turnover and returned income, there was no under-reporting of income. The statutory mechanism for levy of penalty for under-reporting consequently failed. Further, initiation of penalty proceedings depends upon the Assessing Officer's satisfaction and is discretionary, not mandatory. The failure to initiate such proceedings could not, on these facts, render the assessment order erroneous and prejudicial to the interests of the Revenue. [Paras 5, 6]

The revisional order was quashed and the assessee's appeal was allowed.

Final Conclusion: The assessment order could not be revised merely because penalty proceedings had not been initiated, as no under-reporting of income was made out and such initiation was discretionary.

Revisionary jurisdiction during pendency of appeal - Revision on change of opinion after inquiry - Cessation of trading liability

Validity of revision of the assessment concerning purchases from two suppliers when the disallowance of those purchases was already pending in appeal - HELD THAT: - Clause (c) of Explanation 1 to section 263 bars revision in respect of matters considered in an appeal. The appeal before the first appellate authority covered the larger controversy concerning the genuineness of the purchases and the estimation of profit embedded therein. The decisions relied upon for sustaining revision concerned either matters not appealed against or a period preceding the relevant statutory amendment and were inapplicable. [Paras 32, 33, 37]

The revisionary order, insofar as it treated the assessment as erroneous and prejudicial regarding the disputed purchases, was held to be bad in law.

Revision on change of opinion after inquiry - Estimated addition on unverifiable purchases - Validity of revision directing addition of the entire purchases as unexplained expenditure after the Assessing Officer had examined the purchases and estimated the profit element - HELD THAT: - The Assessing Officer had examined the supporting material furnished for the purchases and, after inquiry, adopted the view that only the profit element embedded in the purchases was liable to be added. Revision cannot be invoked to substitute the Principal Commissioner's view that the entire purchases should be assessed as unexplained expenditure, particularly where the issue was debatable and the Assessing Officer's view was plausible. The decision relied on by the Principal Commissioner was distinguishable because, unlike that case, the assessee had furnished supporting documents and participated in the assessment proceedings. [Paras 38, 39, 40, 41, 42]

The assumption of revisionary jurisdiction for taxing the entire disputed purchases was unsustainable.

Cessation of trading liability - Addition of the outstanding credit balance due to a supplier as income on the ground that the supplier was non-genuine - HELD THAT: - A supplier being treated as non-genuine does not, by itself, establish remission or cessation of the corresponding trading liability. As no cessation of liability was found, the outstanding credit balance could not be brought to tax on that basis. [Paras 43]

The revisionary direction to treat the outstanding supplier liability as income was held to have no merit.

Final Conclusion: The revisionary order was set aside and the assessee's appeal was allowed.

Unexplained money u/s 69A - Cash deposits forming part of disclosed business turnover - Estimation of profit on business receipts

Treatment of cash deposits in the bank account of a retail medicine business as unexplained money where the deposits were connected with declared sales - HELD THAT: - Having found the medical business to be genuine and the declared turnover to be broadly supported by VAT returns and consistent with the bank deposits, with no defect identified in the sales or VAT records, the Tribunal held that the deposits could not simultaneously be assessed as unexplained money.

Where deposits constitute business receipts, the gross receipts cannot be brought to tax without recognising the expenditure embedded in the business activity; only a reasonable profit is assessable. Considering the nature of business and the comparable profit ratios, profit was estimated at 5% of the bank deposits. [Paras 6]

The addition as unexplained money was deleted, and the assessment was directed to be reframed by treating the deposits as business income and taxing profit estimated at 5%, subject to the applicable basic exemption limit.

Final Conclusion: The appeal was partly allowed by deleting the addition of the entire bank deposits as unexplained money and directing assessment of only the estimated business profit therefrom.

Revisionary jurisdiction for erroneous and prejudicial assessment - Change of opinion after due enquiry - Deduction of employee stock option expenditure

Validity of revision of the assessment allowing deduction of discount on shares issued under the ESOP/ESAR scheme, where the AO had examined the claim and accepted it - HELD THAT: - The Assessing Officer had called for and considered detailed particulars and the judicial support for the ESOP/ESAR claim before accepting it.

The admission and pendency of an SLP [2021 (8) TMI 1322 - SC ORDER] against the Karnataka High Court decision in Biocon Ltd. [2020 (11) TMI 779 - KARNATAKA HIGH COURT] did not render that decision inoperative; absent a stay or reversal, the prevailing legal position continued to hold the field. As the revisional authority identified no defect in the enquiry or lack of application of mind, its direction for a fresh examination merely substituted its view for the plausible view adopted in assessment and constituted an impermissible change of opinion. The conditions for exercise of revisionary jurisdiction were therefore not fulfilled. [Paras 8]

The revisional order was quashed and the assessment order was restored.

Final Conclusion: The appeal was allowed. The revision under section 263, founded solely on pendency of the SLP despite a due assessment enquiry and a plausible view, was held unsustainable.

Addition u/s 56(2)(x) - difference between the purchase consideration and stamp duty value - Reference to District Valuation Officer - Failure to consider valuation objection

HELD THAT: - The revenue authorities did not deal with the assessee's specific objection to adoption of the stamp duty value or its request for valuation by the District Valuation Officer, although the Registered Valuer's report furnished in appellate proceedings substantially supported the purchase consideration. Finalising the assessment without such reference was held unjustified in the circumstances. [Paras 5]

The addition was set aside and the matter restored to the Assessing Officer to consider the objection, refer the property to the District Valuation Officer and complete the assessment afresh after considering the valuation report and granting hearing to the assessee.

Final Conclusion: The assessee's appeal was allowed for statistical purposes by remanding the valuation dispute for determination by the District Valuation Officer and fresh assessment in accordance with law.

Benami transaction - Cross-examination of foundational retracted statement - Benami proceedings and income-tax assessment findings - Burden of proving benami transaction

Cross-examination of foundational retracted statement - Natural justice in benami adjudication - Reliance on the retracted statement recorded under the Income-tax Act for establishing that the consideration for the appellant's properties was provided by another person, without affording cross-examination in benami adjudication - HELD THAT: - Though statements recorded under the Income-tax Act may be used in proceedings under the PBPT Act, the statement in question was the direct and foundational material for the alleged routing of unaccounted cash; the remaining circumstances were insufficient independently to establish that another person provided the consideration. A statement retracted shortly after its recording, and not tested despite a specific request for cross-examination, could not sustain a finding carrying confiscatory and penal consequences. At the adjudicatory stage, the statutory power to summon and examine the witness had to be exercised if the statement was to be relied upon. [Paras 23, 28, 29, 31, 32]

The denial of cross-examination vitiated the finding founded substantially on the retracted statement; the matter was remanded, with cross-examination to be afforded by the Adjudicating Authority if the statement and its retraction are relied upon.

Evidentiary relevance of income-tax assessment in benami proceedings - Independent operation of income-tax and benami laws - Effect of the assessment order accepting the source and banking trail of the investments in the same properties on the benami proceedings - HELD THAT: - Section 69 of the Income-tax Act and Section 2(9)(A) of the PBPT Act operate in distinct fields: absence of an addition for unexplained investment does not itself preclude a benami finding, and the source of the source remains examinable in benami proceedings. However, the assessment order, rendered on the same investment, fund-flow and material, was relevant evidentiary material and could not be ignored. The statutory independence of the enactments does not resolve inconsistent factual conclusions without examination of the differing inquiries undertaken. [Paras 21, 30, 31, 33]

The assessment order was not conclusive of benami ownership, but required consideration by the Initiating Officer in the fresh determination.

Burden of proving benami transaction - Source of consideration for company-owned property - Failure to examine the appellant-company's document-backed explanation that its pre-existing reserves and recycled loans and advances funded the property purchases - HELD THAT: - A company is not immune from being treated as a benamidar merely because it is a corporate entity, if the statutory conditions are established. Under Section 2(9)(A), however, the Initiating Officer must initially establish, on credible material, both that another person provided the consideration and that the property was held for that person's immediate or future benefit. Once a documented explanation of the source is furnished, it must be specifically examined and accepted or rejected by reasoned findings; an untraced allegation of cash elsewhere cannot substitute proof of the consideration for the particular acquisition. [Paras 21, 31, 32, 33]

As the explanation concerning the vintage of reserves and recycling of advances had not been specifically considered, the issue was remanded for fresh reasoned consideration without an adjudication on the merits of benami ownership.

Final Conclusion: The orders affirming the benami finding and attachment were set aside and the matter was remanded to the Initiating Officer for a fresh determination after considering the assessment order and the appellant's explanation of funds. The provisional attachment was directed to continue pending that determination, with all merits kept open.

Provisional attachment of cash and goldheld by Income Tax Department - Apprehension of alienation under benami law

Validity of provisional attachment of cash and gold already seized and attached by the Income Tax Department on the stated apprehension of tax adjustment or release - HELD THAT: - Provisional attachment is permissible only where the Initiating Officer forms an opinion that the person in possession of the alleged benami property may alienate it during the notice period. As the cash and gold were in the custody and attachment of the Income Tax Department and not with the appellants, no apprehension of their alienation by the appellants was established. Mere apprehension that the Department might adjust the cash against tax liability or release the property did not furnish the statutory basis for attachment; action could be taken if and when release was contemplated. [Paras 5, 6]

The provisional attachment order and its confirmation were quashed, with liberty to initiate a fresh attachment if the statutory conditions are made out; if the cash and gold have been released by the Income Tax Department, the impugned order may remain operative.

Final Conclusion: The appeals were allowed and the provisional attachment and its confirmation were quashed for want of a statutory basis to apprehend alienation of property already under the Income Tax Department's custody, subject to the stated liberty for fresh action.

Interim stay of order declaring advance ruling void ab initio

Whether interim suspension of the order declaring the advance ruling void ab initio should be granted pending final adjudication of the appeal? - HELD THAT: - The Court held that staying the impugned order would revive and continue the original advance ruling during pendency of the appeal. Since the authority had found that the ruling was obtained through misrepresentation, it was not appropriate at the interim stage to nullify the effect of that subsequent order. The sustainability of that finding, fulfilment of the statutory conditions, and the alleged procedural infirmities were left for final hearing. [Paras 17, 18, 19, 20, 21]

The prayer for interim stay was declined.

Final Conclusion: The appeal was admitted for final hearing, but interim protection against the order declaring the advance ruling void ab initio was refused.

Consideration of representation for provisional release of seized goods and currency - Pending representation for provisional release of imported glass beads and seized currency - HELD THAT: - As the customs authorities did not dispute that the representation seeking provisional release remained pending before the Proper Officer, the Court directed that the petitioner be afforded an opportunity of hearing and that the Proper Officer decide the representation, together with any additional representation concerning the subsequent seizure, by a reasoned order in accordance with law. The merits of the rival contentions were left open. [Paras 5, 6]

The Proper Officer was directed to hear the petitioner and complete consideration of the representations by a reasoned order within three weeks.

Final Conclusion: The writ petition was disposed of with directions for an expeditious hearing and reasoned decision on the request for provisional release, without adjudicating its merits.

Expeditious adjudication of customs proceedings - Challenge to the seizure of gold and the pending show-cause proceedings without completion of adjudication - HELD THAT: - Without examining the merits of the competing claims or the alleged irregularities in seizure and the subsequent proceedings, the Court considered it appropriate to require the Adjudicating Authority to conclude the pending proceedings after affording the petitioners a fair opportunity to place their case and additional material. [Paras 3, 4, 5, 6, 7]

The petitioners were directed to participate in the adjudication; the Adjudicating Authority was directed to hold a hearing and pass a reasoned order within the stipulated period, without bias or preconception, while the writ petitions were kept pending.

Final Conclusion: The writ petitions were adjourned sine die pending a reasoned adjudication by the Customs Authority, with liberty to the petitioners to pursue their challenge after the final order.

Rejection of declared transaction value - Proof of customs undervaluation - Extended limitation for customs demand - Release of seized currency and investigation deposit

Rejection of declared transaction value - Proof of customs undervaluation - Admissibility of statements and electronic records - Rejection and re-determination of the declared transaction value of imported LDPE reprocessed/recycled granules on allegations of under-invoicing - HELD THAT: - The burden to displace the declared transaction value lay on the Revenue and required cogent evidence of extra consideration or reliable contemporaneous imports of comparable goods at higher prices. No money trail, remittance record or other independent material established payment beyond the invoice value. The values of imports by unrelated importers were adopted without establishing comparability regarding grade, quality, quantity, commercial level or contemporaneity, and a uniform loading was applied despite inability to ascertain consignment-wise undervaluation. The disputed statements could not conclusively sustain the charge without compliance with the safeguards for their evidentiary use and adequate corroboration; the electronic records were unsupported by the statutory certificate and other requirements governing their admissibility. Revenue consequently failed to establish deliberate undervaluation or justify rejection of the declared values. [Paras 11, 12]

The re-determined value, differential duty demand, confiscation, interest and penalty were set aside on merits.

Extended limitation for customs demand - Suppression or wilful misstatement - Invocation of the extended period for demand relating to imports made from 2007 to 2009 - HELD THAT: - The consignments had been scrutinised and finally assessed by the proper officers, with enhancement wherever considered necessary. In the absence of cogent evidence of deliberate undervaluation, extra consideration, fraud, collusion, wilful misstatement or suppression with intent to evade duty, the extended period could not be invoked. The materials relied upon by the Revenue had been obtained during investigation long before the notice, yet no satisfactory explanation was offered for the delay in initiating proceedings. [Paras 13, 14]

The show cause notice and consequential demand were held barred by limitation.

Release of seized currency - Refund of investigation deposit - Entitlement to release of currency seized during investigation and refund of the amount deposited towards the alleged customs duty liability - HELD THAT: - No cogent material established a nexus between the seized currency and the alleged undervaluation; with the foundation of the duty demand having failed, its appropriation was untenable. The amount deposited during investigation was a deposit pending adjudication, and, once the demand founded on re-determination of value was held unsustainable, the Department could not retain it without authority of law. [Paras 17]

The seized currency was directed to be released and the investigation deposit refunded, in each case with applicable interest in accordance with law.

Final Conclusion: The appeal was allowed on merits and limitation. The customs duty demand, interest, penalty and confiscation were set aside, and release of the seized currency and refund of the investigation deposit with applicable interest were directed in accordance with law.

Export duty exemption for iron ore fines based on Fe content - Reliability of belated re-test of representative samples - Belated re-test of remnant samples - Export duty exemption for iron ore fines containing Fe below 58%

Final assessment of exported iron ore fines on the basis of a belated CRCL re-test indicating Fe content above 58%, in disregard of contemporaneous representative-sample and commercial evidence indicating Fe content below that threshold - HELD THAT: - Re-testing cannot be resorted to arbitrarily or merely because contemporaneous results are inconsistent with the exporter's initial declaration; it must rest on objective and legally sustainable grounds.

The Customs-drawn representative samples analysed by CRCL, Vizag were corroborated by the Load Port and Discharge Port Test Reports, while the contractual price adjustment and realised sale proceeds provided further contemporaneous support. The belated re-test of remnant samples, undertaken more than a year after export, was unsafe because prolonged storage could alter moisture characteristics and laboratory drying could not reconstruct the condition of the goods at export. In the absence of cogent material discrediting the earlier representative-sample report, the solitary delayed re-test could not be preferred over the consistent contemporaneous scientific and commercial evidence.

It is no longer res integra that inordinate delay in testing has a direct bearing on the moisture content of the samples and, consequently, on the accuracy and evidentiary value of the test results. The above issue has been dealt with by this Tribunal in the case of M/s. Vedanta Ltd.[2023 (8) TMI 947 - CESTAT KOLKATA] wherein Tribunal set aside the impugned OIO, allowed the appeal and granted consequential relief on the basis that the Chemical Examiner's delayed and belatedly disclosed reports could not be treated as reliable; timely Government recognized private laboratory reports and commercial acceptance by overseas buyers were accepted as material, rendering the confiscation, redemption fine and penalty unsustainable. [Paras 14, 15, 16, 17, 18]

The re-test and final assessment founded upon it were held unsustainable; the exported iron ore fines were entitled to exemption from export duty/cess on the evidence establishing Fe content below 58%.

Final Conclusion: The appeal was allowed with consequential relief. The appellate order and final assessment levying export duty/cess on the basis of the delayed CRCL, New Delhi re-test were set aside.

Transaction value - rejection for alleged under-invoicing - Residual method of customs valuation - Importer-specific evidence - Judicial discipline - applicability of coordinate Bench precedent Shri Hari Wax-OChem Pvt. Ltd. [2019 (8) TMI 1518 - CESTAT KOLKATA]

Transaction value - rejection for alleged under-invoicing - Importer-specific evidence - Residual method of customs valuation - Rejection and redetermination of the declared transaction value of imported Slack Wax on the allegation of under-invoicing - HELD THAT: - The burden to establish undervaluation lay on the Revenue through cogent, independent and legally admissible evidence relatable to the appellant's imports. Materials recovered from, and statements concerning, other importers could not establish under-invoicing by an independent importer without proof of a nexus or common design; similarity in declared prices was insufficient. The declared transaction value could not therefore be rejected on assumptions or comparative price data, particularly when there was no evidence of payments beyond the invoice value. The private Petrosil price publication, unsupported by proof of its source, methodology, reliability or comparability of goods, could not displace the transaction value. Further, the adjudicating authority had not furnished sustainable reasons for bypassing the sequential valuation methods before resorting to the residual method, or addressed contemporaneous imports at comparable or lower values. [Paras 17, 18, 19]

The allegation of under-invoicing was unsubstantiated; the rejection of declared values, redetermination of value, differential duty demand, confiscation, redemption fine, interest and consequential penalties were set aside.

Judicial discipline - applicability of coordinate Bench precedent SHRI HARI WAX-O-CHEM PRIVATE LIMITED, [2019 (8) TMI 1518 - CESTAT KOLKATA] - Undervaluation of Slack Wax imports - Applicability of the earlier Tribunal decision concerning substantially similar investigations into alleged undervaluation of Slack Wax and Residue Wax imports - HELD THAT: - The earlier decision arose from the same common investigation, substantially identical allegations and similar evidentiary material, and addressed the absence of importer-specific investigation, inadmissibility of third-party electronic material without statutory compliance, improper rejection of transaction value and comparable contemporaneous import data. As no material showed that the decision had been stayed, reversed or otherwise interfered with, it continued to hold the field. The adjudicating authority was required to apply it or record cogent grounds for distinguishing it. [Paras 20]

The earlier Tribunal ratio applied and independently supported setting aside the impugned order and consequential demands.

Final Conclusion: The de novo order was set aside in toto. The Revenue having failed to prove undervaluation of the Slack Wax imports by cogent, importer-specific and legally admissible evidence, the duty demand and all consequential liabilities and penalties were quashed.

Wrongful availment of the benefit of Notification No. 104/2009-Cus. dated 14.09.2009 - utilizing Status Holder Incentive Scrips (SHIS) for import of goods allegedly falling beyond the permissible scope of the said exemption notification.

Eligibility of gaskets, bushings, bearings, gear reducers, springs, whims bottom parts, shock absorbers and similar goods, imported for setting up and modernising manufacturing plants, for exemption as capital goods under Notification No. 104/2009-Cus - HELD THAT: - The definition of capital goods in the notification is wide and includes plant, machinery, equipment and accessories required directly or indirectly for manufacture, including those required for replacement, modernisation, technological upgradation and expansion. Since the imported goods were undisputedly used for modernisation of the appellant's plant, they were accessories falling within that definition.

Following M/s. Ratnamani Metal and Tubes Limited [2022 (9) TMI 1170 - CESTAT AHMEDABAD] and Commissioner of Customs (Port), Kolkata v. M/s. Cosmic Ferro Alloys Ltd. [2024 (8) TMI 674 - CESTAT KOLKATA] the restriction of 10% applies only to components, spares and parts of capital goods imported earlier, and not to capital goods, including accessories, imported for a new plant or modernisation. [Paras 10, 11, 13, 14]

The subject goods were capital goods covered by the notification; the exemption was correctly availed, and the duty demand, interest and penalty were unsustainable.

Final Conclusion: The appeal was allowed. The confirmation of customs duty with interest and the penalty, founded on denial of the SHIS exemption, was set aside.

Duty demand against an importer using transferable DFIA licences - Duty-free import authorisation - transferable licence - Extended period of limitation - absence of suppression by importer

Demand of customs duty from an importer using transferable DFIA licences, on the allegation that the exporter had obtained the licences fraudulently, and invocation of the extended period of limitation - HELD THAT: - The proceedings against the exporter had resulted in dropping of the demand, while the DGFT had imposed penalties without cancelling the licences. Since the exporter's licences remained intact and the allegations against the importer were unproved, the importer could not be held to have employed fraudulent means in importing the goods. The same circumstances afforded no justification for invoking the extended limitation period.

We agree with the contention of the learned Advocate that the Delhi Bench of the Tribunal has, in the case of the exporter viz. M/s.Pan Parag India Ltd. [2025 (3) TMI 1259 - CESTAT NEW DELHI] not only ordered dropping the demand confirmed against the exporter, but also has observed that even the DGFT has only levied penalties without cancelling the license. These findings coupled with the order of this Chennai Bench in the case of Indras Agencies Private Ltd. [2025 (12) TMI 386 - CESTAT CHENNAI] make it clear that even the allegations against the present Respondent` stands not proved rather, when the exporter’s license itself stood intact, the Respondent cannot be held to be involved in any fraudulent ways and means to import the goods that were exported using an irregular/fraudulent license. [Paras 5]

The charge failed both on merits and limitation; the order dropping the demand was upheld.

Final Conclusion: The Revenue's appeal was dismissed and the order dropping the customs-duty demand was upheld.

Country-of-origin misdeclaration - proof by foreign customs intelligence - Confiscation of goods cleared for home consumption - Confiscation for non-production of phytosanitary certificate - Penalty beyond show cause notice

Country-of-origin misdeclaration-proof by foreign customs intelligence - Unauthenticated foreign customs documents - Alleged misdeclaration of the country of origin of imported dry dates as Saudi Arabia instead of Pakistan - HELD THAT: - The burden lay on Revenue to establish the allegation by reliable evidence; it was not for the importers to disprove it. The printouts and photocopies said to have been received through the Customs Overseas Intelligence Network were neither authenticated by the overseas customs authority nor supported by proof of their procurement and transmission, and the statutory procedure for computer-generated material was not shown to have been followed.

Such unverified intelligence could at best initiate investigation and could not conclusively establish origin, particularly when no authentic verification was undertaken from the authority issuing the country-of-origin and phytosanitary certificates. [Paras 18, 23, 37, 38]

The allegation that the dry dates were of Pakistani origin and that their origin had been misdeclared was not established.

Confiscation of goods cleared for home consumption - Phytosanitary certificate for imported dry dates - Confiscation of dry dates already cleared for home consumption and of dry dates seized for non-production of phytosanitary certificates - HELD THAT: - As the alleged origin misdeclaration was not proved, confiscation on that ground could not survive. Goods cleared after examination and satisfaction of the prescribed conditions could not subsequently be proposed for confiscation on account of absence of phytosanitary certificates, since they had ceased to be imported goods. The position differed for seized goods for which phytosanitary certificates had not been produced; those goods remained liable to confiscation, though release was made subject to redemption fine and production of the requisite certificate. [Paras 39, 41, 42]

Confiscation and consequential demands, fines and penalties founded on misdeclaration were set aside; confiscation of the seized dry dates for non-production of phytosanitary certificates was sustained, with an option of redemption subject to production of the certificate.

Penalty beyond show cause notice - Penalty imposed on the importers under Section 112 despite its not having been proposed in the show cause notices - HELD THAT: - A penalty under Section 112 could not be imposed where its imposition had not been proposed in the show cause notices. The adjudicating authority travelled beyond the notices in levying that penalty. [Paras 42]

The penalties imposed under Section 112 were set aside.

Final Conclusion: The appeals of the importer and its partner were allowed. The appeal concerning the other importer was partly allowed: only the confiscation of seized dry dates for non-production of phytosanitary certificates, subject to redemption and certificate requirements, was maintained.

Classification of Pelargonium sidoides root extract - Vegetable extracts with inert carrier - Customs Tariff Item 1302 19 19 or as a medicament under Customs Tariff Item 3003 90 90 - Rectification of advance ruling for apparent error of fact - Customs exemption for vegetable extracts

Rectification of advance ruling for apparent error of fact - Normal solvent removal in vegetable-extract manufacture - Modification of the earlier advance ruling which treated vacuum drying of Pelargonium sidoides root extract as concentration or an additional extraction or purification process - HELD THAT: - The manufacturing record showed hydro-ethanolic extraction, filtration, removal of extraction solvent by vacuum drying, and addition of Maltodextrin as an inert carrier. Vacuum drying is a normal means of obtaining a solid vegetable extract and did not establish concentration, an additional extraction cycle, or purification of the kind that excludes an extract from Heading 1302. The contrary observation in the earlier ruling was unsupported by the record and constituted an apparent error of fact. [Paras 12, 13]

The earlier finding concerning concentration and further extraction or purification was modified.

Classification of Pelargonium sidoides root extract - Vegetable extracts with inert carrier - Medicaments consisting of mixed active constituents - Classification of Pelaforce EMA1170, a bulk hydro-ethanolic Pelargonium sidoides root extract containing Maltodextrin as carrier, as a vegetable extract under Heading 1302 or as a medicament under Heading 3003. - HELD THAT: - Classification is determined by the tariff headings and relevant Notes. A solid vegetable extract obtained by solvent extraction remains within Heading 1302 where inert material is added merely for handling, drying, or standardisation and does not alter its essential character. The product comprised a single botanical extract and Maltodextrin, which was not an active therapeutic constituent; it was neither a mixture of active medicinal ingredients nor presented in measured doses or retail packs. Its supply in bulk as pharmaceutical raw material could not by itself determine classification. [Paras 8, 9, 10, 11, 14]

Pelaforce EMA1170 was held classifiable under Customs Tariff Item 1302 19 19 as other vegetable extracts, and not under Customs Tariff Item 3003 90 90.

Customs exemption for vegetable extracts - Eligibility of the imported Pelargonium sidoides root extract for the exemption under Serial No. 37 of Notification No. 45/2025-Customs - HELD THAT: - Following its classification as other vegetable extracts under Customs Tariff Item 1302 19 19, the product fell within the stated exemption entry. The exemption remains conditional upon fulfilment of the prescribed conditions and verification by the proper officer at assessment. [Paras 15, 16]

The product was held eligible for the notification benefit, subject to satisfaction of its conditions and assessment-stage verification.

Final Conclusion: The advance ruling was modified: Pelaforce EMA1170 was classified as other vegetable extracts under Customs Tariff Item 1302 19 19 and held eligible for the claimed customs exemption, subject to compliance with the notification conditions and verification at assessment.

Security-service provider's claim for payment for preservation of the company's assets - ongoing insolvency proceedings before the NCLT - High Court [2026 (5) TMI 874 - CALCUTTA HIGH COURT] has taken the view that Section 529 of the Companies Act would not come to the aid of the petitioner before us, however, the petitioner should put forward its claim before the NCLT

HELD THAT:- The petition was disposed of, as the matter has now reached the stage of CIRP before the NCLT. It shall be open for the petitioner to join the proceedings before the NCLT and put forward its claim.

Jurisdiction of the Adjudicating Authority in insolvency resolution proceedings - Cooperation by suspended management for recovery of corporate debtor's assets

Whether the Adjudicating Authority had jurisdiction to direct suspended directors of a lessee corporate debtor to assist the resolution professional of the lessor corporate debtor in identifying and recovering leased electric vehicles? - HELD THAT: - Section 60(5) confers wide jurisdiction to determine questions of law or fact arising out of or relating to the insolvency resolution of a corporate debtor. Its expressions "arising out of" and "in relation to" must be construed to facilitate expeditious resolution and preservation of the maximum value of the corporate debtor's assets. Since the vehicles belonged to the corporate debtor represented by the resolution professional and had been leased to the corporate debtor whose suspended management included the appellants, directions requiring their continued cooperation for identification and recovery had a direct nexus with the insolvency resolution process.

The appellants' objection that they could not be directed in their individual capacity was also inconsistent with their acknowledged responsibility to provide information and assistance concerning the vehicles. [Paras 8, 10]

The directions requiring the appellants to assist in identification and recovery of the leased electric vehicles were within jurisdiction and warranted no interference.

Final Conclusion: The appeal was dismissed, the directions to the suspended directors to cooperate in recovery of the electric vehicles being upheld.

Replacement of Interim Resolution Professional - Committee of Creditors' control over replacement of Resolution Professional

Verification and admission of creditors' claims - Reconstitution of Committee of Creditors - Partial admission of secured financial creditors' claims and the consequent reduction in their voting share following admission of homebuyers' claims as grounds for removal of the Interim Resolution Professional - HELD THAT: - The Interim Resolution Professional is statutorily required to receive, verify and collate claims and maintain an updated list of creditors for constitution of the Committee of Creditors. Admission of a claim for a lesser sum upon verification, and reconstitution of the Committee consequent upon admission of further claims, do not by themselves impeach the integrity of the Interim Resolution Professional or furnish a ground for his removal. [Paras 42, 43]

The grievance concerning partial admission of claims and reduction of voting share did not warrant removal of the Interim Resolution Professional.

Removal of Interim Resolution Professional - Commercial wisdom of Committee of Creditors - Exceptional circumstances for judicial interference - Replacement of the Interim Resolution Professional on allegations of bias, misconduct, contractual interference and deadlock in the corporate insolvency resolution process - HELD THAT: - The resolution concerning the contract was not acted upon because its implementation had been stayed by the Adjudicating Authority. Though there was deadlock on certain matters, the creditors in a class supported the Interim Resolution Professional, while the appellants' objections substantially arose from the diminishing voting share caused by admission of homebuyers' claims. Decisions regarding continuation, change or replacement of an Interim Resolution Professional are controlled by the Committee of Creditors and must ordinarily be left to its commercial wisdom; tribunal interference is justified only in exceptional circumstances. No such circumstances were established. [Paras 56, 57, 58, 59, 61]

No ground for interference with the rejection of the applications seeking replacement of the Interim Resolution Professional and restraint on further Committee of Creditors meetings was made out.

Final Conclusion: The appeals were dismissed, the Tribunal finding no exceptional circumstance warranting interference with the refusal to replace the Interim Resolution Professional.

Provisional Attachment Orders (PAO) - power and jurisdiction of authority of the Enforcement Directorate/Authorities forattachment- “reason to believe” that the subject properties were proceeds of crime involved in the money laundering -withdrawal of the concessions given by the Advocate - Meaning of term “proceeds of crime” - proceeds of crime involved in the money laundering -

HELD THAT:- Delay was condoned and the special leave petitions were dismissed without interference with the impugned judgments and orders [2026 (1) TMI 655 - BOMBAY HIGH COURT].

Judicial review of Enforcement Case Information Report - Constitutional jurisdiction over consequential money-laundering proceedings

Maintainability of challenge to Enforcement Case Information Report - Article 226 judicial review - Maintainability of a writ petition under Article 226 read with Section 482 of the Cr.P.C. challenging an Enforcement Case Information Report and consequential proceedings under the PMLA - HELD THAT: - An ECIR may be an internal and administrative document and not equivalent to an FIR, but its nomenclature cannot exclude constitutional scrutiny where it forms the foundation for coercive action affecting liberty, property and reputation. The decisions declining to quash an ECIR under Section 482 of the Cr.P.C. were confined to inherent jurisdiction and did not determine the width of judicial review under Article 226.

The High Court's jurisdiction extends to examine the legality of the ECIR and the entire chain of consequential proceedings; otherwise, a single cause of action would be impermissibly fragmented. [Paras 18, 20, 21, 22, 23]

The preliminary objection was rejected; the writ petition is maintainable and is to be heard on merits.

Final Conclusion: The writ petition challenging the ECIR and consequential PMLA action was held maintainable. The Court rejected the Directorate of Enforcement's preliminary objection and directed that the petition be heard on merits.

Service tax on indivisible turnkey contracts - Vivisection of composite contracts - true nature of the contracts -Commissioning or installation of ATMs -

Leviability of service tax on a notional installation and commissioning component of composite turnkey contracts for supply of ATMs - HELD THAT: - The contracts were indivisible turnkey contracts for delivery of fully functional ATMs, with supply, installation, testing and commissioning forming integral obligations for a single composite consideration; installation and commissioning were neither independently contracted nor separately remunerated. Prior to the introduction of works contract service, the Finance Act, 1994 contained neither a charging provision nor a valuation machinery authorising segregation of the service element from such composite contracts.

As held in Commissioner, Central Excise and Customs, Kerala vs. Larsen and Toubro Limited [2015 (8) TMI 749 - SUPREME COURT], pre-existing taxable entries applied to service contracts simpliciter and could not be employed to vivisect an indivisible composite contract. A notional attribution of part of the consideration could not create a taxable event absent statutory authority.

In the absence of any statutory authority permitting the artificial segregation of the installation and commissioning component from the composite transaction, the Revenue was not entitled to levy service tax by attributing a notional percentage of the total contractual consideration to the taxable category of “commissioning or installation” under Section 65(105)(zzd) of Finance Act, 1994. The conclusion reached by the CESTAT is thus in consonance with the statutory scheme of the Finance Act, 1994 and the law subsequently declared by this Court in Larsen and Toubro Limited [2015 (8) TMI 749 - SUPREME COURT].[Paras 34, 35, 36, 37, 40]

The demand under the taxable category of commissioning or installation was unsustainable, and the CESTAT's order setting aside the demands was affirmed.

Final Conclusion: The appeals were dismissed. The CESTAT's order was upheld as the Finance Act, 1994 did not permit vivisection of the composite turnkey ATM contracts during the relevant period.

Service tax on construction of residential complexes - Extended limitation-suppression of facts

Service tax on construction of residential complexes - Service-tax liability on construction of residential complexes undertaken during April 2008 to March 2011 - HELD THAT: - Construction of residential complex service became taxable only from 1-7-2010. The appellant was consequently not liable for service tax for the period preceding that date. Though service tax had been paid voluntarily for the earlier non-taxable period, without protest, no refund of such excess payment was admissible. [Paras 8, 11]

The service-tax demand, with interest and penalty, was set aside; voluntary excess tax paid for the pre-taxable period was not refundable.

Extended limitation - suppression of facts - Invocation of the extended period for service-tax demand where the registered assessee paid tax on its share of receipts and filed ST-3 returns - HELD THAT: - As the appellant was registered, paid service tax on its portion of income and filed ST-3 returns, the Revenue had not established suppression. The extended period could therefore not be invoked. [Paras 12]

The demand for the extended period was also held barred by limitation.

Final Conclusion: The appeal was allowed and the impugned demand, interest and penalty were set aside. Consequential relief was directed in accordance with law.

Validity of show cause notice for service tax demand - Identification of taxable service, service recipient and consideration

Sustainability of service tax demand founded on differences between ST-3 returns, income-tax returns and unbilled revenue, without identification of the taxable service, its recipient or the consideration - HELD THAT: - A show cause notice for service tax must identify the service alleged to have been rendered, the recipient and the consideration forming the basis of liability. The notice merely recorded audit objections, correspondence and discrepancies in figures, without stating how those figures established a taxable service.

Registration under several service categories could not dispense with the Department's obligation to identify the particular service and recipient. Following Shubham Electricals [2016 (5) TMI 1055 - DELHI HIGH COURT], the Tribunal held that a vague, non-committal and unclear notice could not sustain the demand. [Paras 16, 17, 18, 21]

The show cause notice and the consequential order were set aside; the remaining issues were not examined.

Final Conclusion: The appeal was allowed because the service tax demand rested on an unsustainable show cause notice that did not identify the taxable service, its recipient or the consideration.

Service tax on pre-levy mining leases - Assignment of right to use natural resources - Reverse charge on mining royalty and statutory contributions

Leviability of service tax under reverse charge on royalty, DMF and NMET contributions and user fee paid during 01.04.2016 to 30.06.2017 pursuant to a mining lease executed before 01.04.2016 - HELD THAT: - The Tribunal followed Tarini Prasad Mohanty v. Commissioner of C.G.S.T. and Central Excise, Rourkela [2026 (6) TMI 1475 - CESTAT KOLKATA] which applied the principle that taxability of the grant of the right to use natural resources is governed by the law in force when that right was assigned. Since the mining lease had been executed before such Government services became taxable with effect from 01.04.2016, the subsequent payments of royalty, DMF and NMET contributions and user fee did not attract service tax. [Paras 13, 14]

The service-tax demand, interest and penalties were held unsustainable and were set aside.

Final Conclusion: The appeal was allowed. The demand of service tax on payments under the pre-01.04.2016 mining lease, with interest and penalties, was set aside.

Mega Exemption for original works predominantly used other than for commerce, industry or business - construction of a mini agricultural market and agricultural facilitation centre for a government organisation -Works contract services provided for government-approved residential housing projects - Pre-1 March 2015 contractual condition for exemption of original works

Commercial use of agricultural market infrastructure - Mega Exemption for original works predominantly used other than for commerce, industry or business - Eligibility of construction of a mini agricultural market and agricultural facilitation centre for exemption as original works provided to Government for use other than commerce, industry or business - HELD THAT: - Though the infrastructure was constructed under a Government scheme for agricultural welfare, the exemption required that it be predominantly for use other than commerce, industry or business. Commercial use must be understood as profit-oriented activity; however, the appellant neither established a statutory mandate for collection of user fee nor showed that such fee was deposited into the Government treasury. The construction was therefore not shown to fall within the non-commercial-use condition of the exemption. [Paras 5]

The service tax demand relating to construction of the mini agricultural market was sustained.

Works contract services provided for government-approved residential housing projects - Services provided to competent governmental authority - Exemption of works contract services for construction of residential units under Government-approved housing projects where the work orders were issued by the Government housing authority - HELD THAT: - The work orders for construction of residential units were issued by the Government housing authority and demonstrated that the activity formed part of Government-approved residential housing projects. The finding that the services were not provided to a competent authority was therefore erroneous. [Paras 5]

The service tax demand relating to construction of residential units was set aside.

Pre-1 March 2015 contractual condition for exemption of original works - Availability of the claimed exemption for construction of a Government high school where the relevant work orders were entered into after 1 March 2015 - HELD THAT: - The exemption invoked was available only where the relevant contract had been entered into before 1 March 2015. As the work orders for construction of the school were admittedly issued after that date, the prescribed condition was not fulfilled. [Paras 5]

Denial of exemption and the service tax demand relating to construction of the Government high school were upheld.

Final Conclusion: The appeal was partly allowed. The demand for construction of residential units was set aside, while the demands concerning the agricultural mini market and Government high school were sustained.

Manufacture - process incidental or ancillary to manufacture - CENVAT credit - benefit of Notification No. 56/2002-CE - recovery as "erroneous refund" under Section 11A - onus on Revenue to prove manufacture - applicability of Metlex (I) Pvt Ltd - res judicata / estoppel in taxation matters - HELD THAT:- We find no grounds to interfere with the impugned order(s) of the Customs, Excise and Service Tax Appellate Tribunal, Chandigarh [2025 (10) TMI 610 - CESTAT CHANDIGARH]. Hence, the present Appeals are dismissed.

Manufacture - dilution and repacking of styrene butadiene latex - Consistency in departmental stand for different periods

Manufacture - dilution and repacking of styrene butadiene latex - Classification of Sika Latex and Sika Latex Power - whether the process of adding water and preservatives to the inputs classifiable under tariff heading 40.02 and thereafter, packaging the same and marketing it as 'Sika Latex' and 'Sika Latex Power' will amount to 'manufacture' under Section 2(f) of the Central Excise Act, 1944 or not? - HELD THAT: - Manufacture requires transformation into a new and distinct article having a distinctive name, character or use. The Tribunal's earlier decision in the assessee's own case [2017 (7) TMI 715 - CESTAT KOLKATA] which found that the input and resultant products retained the same chemical characteristics and that no new product emerged, governed the controversy. The products therefore continued to merit classification under Chapter Heading 40.02 and were not liable to fresh excise duty. [Paras 7, 8]

The Revenue's contention that the process constituted manufacture and rendered the goods classifiable under tariff heading 3824 4010 was rejected.

Consistency in departmental stand for different periods - HELD THAT: - The earlier Tribunal orders on manufacture and classification had attained finality, as the Department had not challenged them. Having accepted that legal position, the Department could not take an inconsistent view on the same issue for a later period. [Paras 9]

No interference with the order dropping the proceedings was warranted.

Final Conclusion: The Revenue's appeal was dismissed and the order dropping the excise-duty proceedings for April 2007 to September 2015 was sustained. The cross-objection was disposed of.

CENVAT credit on input services for procurement of fly ash - Input services used outside factory premises - Services used outside factory premises

Eligibility to CENVAT credit of loading, unloading, freight and fly ash pond maintenance services used for procuring fly ash from the supplier's power plant for manufacture of cement - HELD THAT: - Fly ash was admittedly an input used in manufacture of the final product. Rule 2(l) permits credit of services used, directly or indirectly, in or in relation to manufacture, including procurement of inputs and inward transportation.

The fact that the services were rendered at the fly ash pond or otherwise outside the factory premises does not disentitle the manufacturer to credit where those services facilitated procurement and movement of the input to the factory. The Tribunal applied CC, Nagpur Vs. Ultratech Cement Ltd [2010 (7) TMI 302 - CESTAT, MUMBAI] and Birla Corporation Ltd. Vs. CCE, Lucknow [2013 (11) TMI 987 - CESTAT NEW DELHI] holding their ratios squarely applicable. [Paras 6, 7, 9]

The denial of CENVAT credit was unsustainable; the impugned order was set aside and the appeal allowed with consequential relief in accordance with law.

Final Conclusion: The appeal was allowed, the denial of CENVAT credit on services used for procurement and transport of fly ash was set aside, and consequential relief was granted in accordance with law.

Penalty for alteration in Form-38 without intention to evade tax - Machinery parts imported for own use and not for sale

Penalty for alteration in Form-38 in respect of machinery parts imported for repair and maintenance of the manufacturing plant, where the goods were not intended for sale - HELD THAT: - The goods were accompanied by the tax invoice, GR, Form-38 and Form-402, and no discrepancy was found in their description, quantity or value. The only discrepancy was use of a white correction marker in the invoice-amount column of Form-38. Since the machinery parts were for the revisionists' own plant maintenance and not for sale, and no material established that they dealt in such goods or had evaded or attempted to evade tax, no adverse inference warranting penalty could be drawn.

The issue in hand is squarely covered by the judgments of this Court in the cases of M/s Garg Photo Films [2025 (10) TMI 605 - ALLAHABAD HIGH COURT] and M/s Vishal International [2026 (8) TMI 321 - ALLAHABAD HIGH COURT] (supra).[Paras 9, 10, 11]

The penalty and the impugned order were quashed, and the questions of law were answered in favour of the revisionists.

Final Conclusion: The revision was allowed and the penalty order was quashed, as no evasion or attempted evasion of tax was established in respect of machinery parts imported for the revisionists' own use.

Article 32 jurisdiction for quashing FIRs - Multiple FIRs and same transaction

Article 32 jurisdiction for quashing FIRs - Exercise of Article 32 jurisdiction to quash FIRs where no infringement of a fundamental right or exceptional circumstance is established - HELD THAT: - It is well settled that the power of this Court under Article 32 is broad enough to quash criminal proceedings in an appropriate case, so as to prevent abuse of the process of law. The existence of an alternative statutory remedy does not, by itself, bar the exercise of jurisdiction. However, as a matter of judicial principle and orderly procedure, an aggrieved party is expected, in the ordinary course, to firstly approach the High Court. It is only where the facts disclose a violation of fundamental right(s) or other compelling circumstances that this Court would directly exercise its extraordinary jurisdiction under Article 32. [See: Romesh Thappar v. State of Madras [1950 (5) TMI 42 - SUPREME COURT]; Union of India v. Paul Manickam [2003 (10) TMI 61 - SUPREME COURT]; Jagisha Arora v. State of U.P [2019 (6) TMI 1759 - SUPREME COURT] and Sunil Kumar Rai v. State of Bihar[2022 (2) TMI 1534 - SUPREME COURT]

Though a petition under Article 32 for quashing criminal proceedings is maintainable, the extraordinary jurisdiction is ordinarily not to be invoked by bypassing the remedies before the High Court under Article 226 of the Constitution or Section 482 CrPC. The petitioner disclosed neither infringement of a fundamental right nor exceptional or exigent circumstances warranting direct intervention. [Paras 10, 11]

The prayer for quashing the FIRs was declined, with liberty to pursue remedies available in law before the appropriate forum.

Multiple FIRs and same transaction - Test of sameness - Clubbing and composite investigation of FIRs concerning cyber-fraud complaints by different victims - HELD THAT: - Multiple FIRs are impermissible where they concern the same incident or connected offences forming one transaction; but separate FIRs are permissible for distinct occurrences or transactions. Applying the test of sameness, the Court found that the complaints arose from separate inducements, different victims, distinct transactions and consequences, without a live link between them. A common alleged modus operandi and transfer of part of the amounts to the proprietary concern's bank account did not establish one transaction. At the nascent stage of investigation, a composite investigation could also impede effective tracing of funds and the wider chain of events. [Paras 15, 16, 17, 18]

The FIRs were held to disclose prima facie distinct offences and were not directed to be clubbed or consolidated.

Final Conclusion: The writ petition was dismissed. The petitioner was left at liberty to seek such remedies as may be available before the appropriate forum, with all contentions left open.

Complaint by an incorporeal payee through its authorised representative - name of the authorised agent precedes that of the complainant society in cause title - Technical defect in cause title

Maintainability of a cheque-dishonour complaint instituted by a co-operative society through its Secretary where the Secretary's name precedes that of the society in the cause title - HELD THAT: - The complaint, read as a whole and with the documents filed with it, showed that the transaction, cheque, statutory notice and agreement concerned the Society, which was the payee. Its bye-laws and the Managing Committee resolution authorised the Secretary to institute proceedings.

Applying Bhupesh Rathod v. Dayashankar Prasad Chaurasia and Another [2021 (11) TMI 457 - SUPREME COURT] the Court held that naming the authorised office-bearer first in the cause title does not create a fundamental defect where the complaint is plainly instituted for and on behalf of the artificial person. The objection related only to form, not to the Secretary's authority, and could not defeat the prosecution.

In Rathish Babu Unnikrishnan v. State (NCT of Delhi) and Another [2022 (4) TMI 1434 - SUPREME COURT] the Hon’ble Supreme Court has held that when there is a legal presumption under Section 139 of the N.I Act, it would not be judicious to carry out a detailed enquiry on a disputed question of fact at the pre-trial stage to quash the complaint[Paras 13, 14, 16, 19, 20]

The complaint was held to have been validly filed by the Society through its authorised Secretary; the petition to quash it was dismissed.

Final Conclusion: The challenge based solely on the drafting of the cause title was rejected. The complaint was permitted to proceed as one instituted by the payee Society through its duly authorised Secretary.