Input tax credit under Section 16 is a conditional statutory entitlement: the recipient must establish eligibility, including that the supplier has paid the tax. Section 16(2)(c), read with Section 41, permits reversal of credit for supplier default and re-availment after payment, and is not subject to a bona fide-purchaser exception. Allegations of fake invoices, bogus supplies and absence of goods movement may provide the prima facie foundation for proceedings under Section 74, while their evidentiary correctness requires merits review. Form GST DRC-01A is not a mandatory precondition under Rule 142(1A), and investigation and determination by the proper officer do not alone establish bias. Transactional disputes are to be pursued through the statutory appellate framework.

GST assessment proceedings may be restored for fresh merits adjudication despite expiry of the appellate limitation where the taxpayer substantiates medical incapacity during the relevant period, had promptly pursued rectification, and undertakes to comply with specified conditions. The assessment was quashed subject to deposit of 10% of the disputed tax and submission of a reply with supporting documents, enabling fresh consideration of the taxpayer's position.

The ten-percent penalty pre-deposit proviso under Section 107(6) applies only where the adjudication order demands penalty without any demand of tax. Where an adjudication order confirms tax, interest and penalty but appropriates tax and interest already paid, it remains an order involving a tax demand. A later recovery order limited to penalty does not change that character. Consequently, the penalty-only pre-deposit requirement does not apply, and rejection of the statutory appeal for non-compliance is invalid; the appeal requires adjudication on merits.

Supplier certificates supporting receipt of supplies and GST payment provide prima facie support against a disputed GST demand, but must accurately identify the recipient's GSTIN where the supplier's GSTR-1 contains an erroneous recipient entry. A corrected certificate including the omitted GSTIN particulars was required for fresh adjudication. The disputed tax order was set aside and remanded for reconsideration, subject to the stipulated deposit.

Section 74(9) GST notices invoking fraud, wilful misrepresentation or suppression must disclose the foundational facts supporting those allegations. Mere mechanical use of those expressions, without reasons demonstrating application of mind, does not validly invoke the extended recovery mechanism. Notices that omit sufficient reasons and the factual basis for the alleged conduct are invalid and liable to be quashed.

Electronic GST appeal filing must not be obstructed by a portal limitation where a disputed demand has been deposited under protest and the demand order displays nil demand. GSTN enabled filing of appeals against nil orders through Form GST APL-01, preserving the statutory appellate remedy and access to justice. The assessee may file the appeal within two weeks, and the filing must be treated as regular without objection.

Constitutional validity of the GST input tax credit condition requiring the supplier's actual tax payment is under challenge, including its effect on bona fide purchasers, alleged double taxation, and Article 14 equality. The Supreme Court issued notice and stayed the High Court's judgment pending final disposal.

Constitutional validity of the input tax credit condition requiring a supplier's actual tax payment is under Supreme Court consideration. The challenge concerns denial of credit to a bona fide purchaser where the supplier has not remitted tax, including arguments for reading down the condition to prevent double taxation and to satisfy Article 14 equality requirements. The Supreme Court issued notice, stayed the High Court judgment and orders, and listed the matter for final disposal.

GST portal access now permits statutory appeals in Form GST APL-01 against nil demand orders where the disputed demand was deposited under protest. An appeal filed within the permitted period through this enabled facility is to be treated as regularly filed without objection. The portal change addresses access-to-justice barriers created when a nil demand status previously prevented appeal filing. Administrative instructions were to be considered to facilitate the same process for similarly situated taxpayers.

GST notices alleging fraud, wilful misrepresentation or suppression must disclose the foundational facts supporting those allegations. Mere reproduction of statutory expressions, without reasons showing application of mind, does not sustain proceedings alleging input tax credit availed through fake invoices without actual supply of goods. Notices lacking sufficient reasons were quashed, while preserving the authority's liberty to issue fresh notices in accordance with law.

Supplier certification prima facie evidencing receipt of supplies and payment of GST may support reconsideration of a disputed GST demand despite an incorrect GSTIN being reported in GSTR-1. Where the certificate omitted the GSTIN of the person inadvertently recorded in GSTR-1, the taxpayer was permitted to submit an amended certificate identifying those particulars. Subject to the stipulated deposit, the demand order was set aside for fresh consideration after submission of the amended certificate, and the bank attachment was to be lifted upon compliance with that condition.

Statutory pre-deposit for an appeal against a penalty order does not apply under the proviso where the original order imposed a composite liability for tax, interest and penalty. Payment of the tax and interest components does not convert that original composite order into an order demanding penalty alone. A later recovery order confined to penalty likewise does not alter the character of the original order. Accordingly, rejection of the appeal for failure to deposit ten per cent of the penalty was set aside and the appeal was restored for adjudication on merits.

Conditional de novo GST adjudication may be granted where an assessee shows inability to participate because of heart illness and undertakes to make a partial pre-deposit. The assessment may be quashed and treated as an addendum to the show-cause notice, allowing a fresh reply with supporting documents. Fresh adjudication is conditional on cash deposit of 10% of disputed tax and timely submission of the reply; failing compliance, recovery may proceed according to law.

Input tax credit is a conditional statutory entitlement requiring cumulative compliance, including actual tax payment by the supplier. Recipient exposure to supplier default is addressed through reversal and subsequent re-availment of credit, with the claimant bearing the burden of proving eligibility. Fraud-based proceedings require prima facie material supporting allegations of fraud, wilful misstatement or suppression; detailed allegations of fake invoices, bogus supplies and no movement of goods require merits examination. Pre-notice intimation is enabling rather than mandatory, and investigation and adjudication by the proper officer do not alone establish bias. Merits disputes should ordinarily proceed through the statutory appellate remedy.

Clause 2(c) of the 2006 interest waiver/reduction scheme requires non-payment of tax to result from a jurisdictional High Court ruling that governed the taxpayer when advance tax was paid or the return was filed. A later ruling does not satisfy that condition, and waiver also requires prior payment of the principal income-tax demand. Challenges to the underlying interest liability cannot be pursued in proceedings confined to a waiver application. Interest under section 220(2) arises only after default in paying a demand served under section 156 within the prescribed period. Waiver rejection was sustained, while taxpayers may seek refund of excess section 220(2) interest if charged from the return-filing date.

For assessment orders passed before 1 April 2025, the Assessing Officer lacked jurisdiction to impose or initiate penalty proceedings for contravention of cash loan or deposit restrictions under section 271D. Non-initiation of such penalty proceedings therefore could not make the assessment order erroneous and prejudicial to the interests of the Revenue for revision under section 263. A revisionary order founded solely on that omission was set aside, and the taxpayer's appeal was allowed.

Obsolete telecom-related inventory may be written down to nil under a consistently applied lower-of-cost-or-net-realisable-value method where physical verification, item-wise particulars, audited-account disclosures and business discontinuance support that valuation. Inventory should not be carried above the amount expected from sale or use. A higher assumed scrap or realisable value requires positive evidence, such as an independent valuation, market quotation, comparable sale or identified purchaser; absence of a technical certificate or separate bank communication does not by itself displace a supported valuation. The Revenue bears the burden of proving a higher net realisable value once the valuation basis is reasonably demonstrated.

Surrendered income arising from cash and stock discrepancies at business premises, and disclosed in the profit and loss account, is treated as business income where no independent undisclosed asset or non-business source is identified. The enhanced tax rate under section 115BBE, effective from 1 April 2017 without express retrospective operation, does not apply to FY 2016-17. Where competing reasonable interpretations of an ambiguous taxing provision are available and no jurisdictional High Court ruling governs, the interpretation favourable to the assessee applies. The surrendered income is consequently taxable at the normal business-income rate.

Rejection of books of account under section 145(3) requires specific defects that prevent correct determination of business income; suspicion about cash receipts is insufficient where disclosed turnover and trading results remain undisturbed and computerised books and supporting records are offered for verification. Section 69A does not apply to money recorded in the books merely because the books are formally rejected. Cash deposits within recorded cash balances, arising from disclosed sales and trade-debtor realisations, cannot be assessed again as unexplained income unless their nexus with the recorded business is disproved. The section 69A addition was deleted, with consequential taxation under section 115BBE and penalty proceedings not surviving.

Section 50's deeming fiction treats gains on transfer of depreciable assets as short-term capital gains only for capital-gains computation. It does not exclude commercial profit credited to the Profit and Loss Account from book profit used to determine the ceiling on working partners' remuneration. Explanation 3 to section 40(b) starts with net profit in the Profit and Loss Account, subject to Chapter IV-D adjustments and add-back of remuneration already deducted, rather than excluding receipts taxable under another income head. Profit from sale of depreciable shop premises therefore remained in book profit, making the claimed partners' remuneration within the statutory ceiling and requiring deletion of the disallowance.