GST Update
CA Raj Chawla
Quotes of the day:
1. Don’t close the Book when BAD Things happen in your LIFE, Just turn the PAGE and BEGIN a new CHAPTER.
2. Moments are more Important than Things. It's not How we make Mistakes But How we Correct them that Defines Us.
GST Update:
1. GST Return and Tax Payment Sufficient to Set Aside Demand under Section 74: Himachal Pradesh HC
2. Himachal Pradesh High Court has ruled that filing GST returns and paying taxes is sufficient to set aside a demand notice issued under Section 74 of the GST Act. The court made this observation in the case of Shivalik Containers Pvt . Ltd. vs The Assistant Commissioner [CWP No. 20174/2025; 24-Dec-2025 :: (2025) 12 Tax Reply 15369].
3. Case Summary:
Background: Shivalik Containers Pvt . Ltd. had filed a writ petition challenging a demand notice issued under Section 74 of the GST Act.
4. Court's Decision: The court held that if the supplier has filed GST returns and paid taxes, the demand notice issued under Section 74 cannot be sustained.
5. Reasoning: The court observed that Section 74 can only be invoked if there is evidence of tax evasion or other mala fide intentions. In this case, since the supplier had filed GST returns and paid taxes, the demand notice was liable to be set aside.
6. Implications:
Relief for Taxpayers: This decision provides relief to taxpayers who have filed GST returns and paid taxes, but are still facing demand notices under Section 74.
7. Guidance for Tax Authorities: The court's decision serves as a guidance for tax authorities to exercise caution and follow the law while issuing demand notices under Section 74.
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With best regards
CA (Dr) Raj Chawla
B.Com (Hons), FCA, FCS, FCMA, LLB
MIMA, DISA, MICA, Phd, ASA (Aust), CMP (USA)
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