M/S. D P Jain and Co. Infrastructure Pvt. Ltd., Nagpur Thr. General Manager (Accounts), Sanjay Bole v. Union of India, Thr. the Secretary, Ministry of Finance Dept. of Revenue, New Delhi and Ors.

Bombay HC17 Apr 2025WP/2087/2025

Case brief

AI extract

What is this about?

Corporate guarantee; GST taxation of corporate guarantee by holding company for subsidiary credit facilities; Rule 28(2) CGST Rules 2017; related person transactions; clarification dated 27.10.2023; show cause notice dated 28.1.2025; ad-interim stay; Schloss HMA Pvt. Ltd. v. Union of India (2025) 26 Centax 382; Nagpur Bench interim order; returnable 09.06.2025.

What did the court decide?

Ad-interim stay to the impugned show cause notice dated 28.1.2025 till the returnable date (09.06.2025); notice for final disposal issued, returnable on 09.06.2025. ¶¶15

M/S. D P Jain and Co. Infrastructure Pvt. Ltd., Nagpur… — GST and Indirect Tax | Bombay HC (2025)

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1 925-2087-2025.odt

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IN THE HIGH COURT OF JUDICATURE AT BOMBAY NAGPUR BENCH AT NAGPUR

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WRIT PETITION NO. 2087 OF 2025

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M/s. D.P. Jain & Co. Infrastructure Private Limited

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Vs.

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Union of India, Through the Secretary, Ministry of Finance Department and others

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Office Notes, Office Memoranda Court's or Judge's orders of Coram, Appearances, Court's orders or directions and Registrar's orders

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Mr. J.K. Mittal, Advocate a/b Mr. R.K. Joshi, Advocate for Petitioner Mr. Kunal Nalamwar, Advocate for Respondent Nos.1 and 2 Mr. A.S. Fulzele, Addl. GP for Respondent No.6

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CORAM: AVINASH G. GHAROTE AND ABHAY J. MANTRI, JJ.

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DATED : 17^th APRIL, 2025

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Heard learned counsel for the petitioner. The petition questions the clarification dated 27.10.2023, issued by the respondents by which the activity of providing corporate guarantee by a person on behalf of another related person or by the holding company, for sanction of credit facilities to its subsidiary companies, which is to be given to a Bank or Financial Institution clarified to be a taxable item under the GST (page 214) and so also the amendment to the Rule 28 of the CGST Rules, 2017, by which Sub-Rule 2 has been inserted, to include the above service as a taxable service and show cause notice dated 28.1.2025 (page 237), consequent thereto.

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2 925-2087-2025.odt

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Issue notice for final disposal to the respondents, returnable on 09.06.2025.

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It is also contended, that while considering the similar challenge, the learned Division Bench of this Court in Schloss HMA Pvt. Ltd. Vs. Union of India, (2025) 26 Centax 382 , the learned Division Bench has already stayed the show cause notice.

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Since the validity of the amendment Rules 28(2) of the CGS Rules of 2017 is being questioned, there shall be ad-interim stay to the impugned notice dated 28.1.2025 (page 237), till the returnable date.

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Mr. Nalamwar, learned counsel waives service of notice for respondent Nos.1 and 2.

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Mr. A.S. Fulzele, learned Additional Government Pleader waives service notice for respondent No. 6.

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(ABHAY J. MANTRI, J.) (AVINASH G. GHAROTE, J.)

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MP Deshpande

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Signed by: Mr. M.P. Deshpande Designation: PA To Honourable Judge Date: 17/04/2025 18:53:38

M/S. D P Jain and Co. Infrastructure Pvt. Ltd., Nagpur Thr. General Manager (Accounts), Sanjay Bole v. Union of India, Thr. the Secretary, Ministry of Finance Dept. of Revenue, New Delhi and Ors.

Case brief

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What did the court decide?

M/S. D P Jain and Co. Infrastructure Pvt. Ltd., Nagpur Thr. General Manager (Accounts), Sanjay Bole v. Union of India, Thr. the Secretary, Ministry of Finance Dept. of Revenue, New Delhi and Ors.

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