GST 2.0 Live Updates: New GST Rates Structure Effective September 22, 2025

India ushers in a new era of taxation with GST 2.0, as the government implements the most significant overhaul of the Goods and Services Tax system since its inception in 2017. Effective September 22, 2025, the previous four-slab GST structure (5%, 12%, 18%, 28%) has been replaced by a simplified two-rate model—5% and 18%—with select luxury and sin goods taxed at 40%.

The new rates mean that daily essentials such as food grains, medicines, educational supplies, soaps, bicycles, and healthcare services will be taxed at the lower 5% rate. More expensive goods, including many consumer electronics, vehicles, and higher-priced garments, will typically fall under the 18% slab, with some premium items (like clothing above ₹2,500) shifting to this bracket. Ultra-luxury products—including premium vehicles, tobacco, and certain aerated drinks—will attract the highest rate of 40%.

Finance Minister Nirmala Sitharaman and Prime Minister Narendra Modi have characterized this reform as a leap toward economic efficiency and “Aatmanirbhar Bharat” (self-reliant India), aimed at rationalizing rates and reducing tax compliance burdens for businesses. The GST Council expects these changes will make household items more affordable, boost consumption, and infuse ₹2 lakh crore into the broader economy.

Businesses across India are updating their systems and relabeling products to reflect the new rates, while consumers are encouraged to revisit their purchasing and budgeting habits in light of the revised tax bands. The new framework, promises a “trust-based tax system” that is expected to facilitate easier compliance for taxpayers and encourage greater transparency and trust between citizens and government.

For a detailed list of updated GST rates by product category, consult the official GST Council notifications or latest government circulars available at authorized GST portals.

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GST News Update: Advisory on Filing Pending Returns Before Expiry of Three Years

The Goods and Services Tax (GST) Department has issued an important advisory for taxpayers regarding the filing of pending GST returns. As per recent updates, taxpayers must ensure that all pending returns are filed before the expiry of three years from the due date. Any return that remains unfiled beyond this period may lapse, and taxpayers will lose the chance to file them later.

This advisory is particularly crucial for businesses and individuals who have outstanding GST filings. The government aims to streamline compliance, reduce litigation, and ensure accuracy in tax credit claims.

Key Highlights:

• Pending GSTR-3B, GSTR-1, and other returns older than three years cannot be filed after the cut-off.
• Taxpayers should immediately check their GST dashboard for any pending filings.
• Non-filing of returns within the timeline may lead to denial of Input Tax Credit (ITC), late fee, interest, and possible penalties.
• The GSTN is sending alerts to registered taxpayers as reminders for compliance.

What Should Taxpayers Do?

• Review your GST compliance status on the GST portal.
• File all pending returns on priority before the three-year expiry deadline.
• Consult your tax advisor or GST professional for rectification of errors in earlier filings.
• Ensure timely filing going forward to avoid penalties and compliance risks.

This update serves as a timely reminder for taxpayers to stay vigilant and proactive in their GST compliance journey. Non-filing of pending returns could result not only in financial costs but also legal complications.

For expert consultation and assistance in filing pending GST returns, Taxation Legal Advisor provides end-to-end solutions to safeguard your compliance and avoid revenue loss.

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Introduction

In a significant ruling dated 16th May 2025, the High Court of Delhi set aside an order passed by the Sales Tax Officer, Ward 56, Zone 4, Delhi, in the case of M/s Mascon vs. Commissioner of Delhi Goods and Services Tax. The Court held that the petitioner was not given a proper opportunity to respond to the Show Cause Notice (SCN), leading to an ex-parte order.

Background of the Case

The petitioner, M/s Mascon, challenged:

• A Show Cause Notice dated 29th May 2024

• The subsequent order dated 7th August 2024

• The validity of GST Notifications No. 56/2023-Central Tax and 56/2023-State Tax

The case was heard by Justices Prathiba M. Singh and Rajneesh Kumar Gupta through hybrid mode.

Key Legal Issues

• Challenge to GST Notifications

• The petitioner contested the legality of Notification No. 56/2023, arguing that it was issued without following proper procedures under Section 168A of the CGST Act, 2017.

• The Court noted that the Supreme Court is already examining this issue in SLP No. 4240/2025 (M/s HCC-SEW-MEIL-AAG JV vs. Assistant Commissioner of State Tax).

• Lack of Opportunity to Respond

• The petitioner failed to file a reply to the SCN, leading to an ex-parte order.

• The Court observed that reminder notices (9th July 2024 & 20th July 2024) were issued, but no reply was submitted.

• Remand to Adjudicating Authority

• The Court set aside the impugned order and granted the petitioner time till 10th July 2025 to file a reply.

• The Adjudicating Authority must conduct a fresh hearing and pass a new order.

Court’s Decision

• The impugned order was quashed, and the matter was remanded for reconsideration.

• The petitioner must file a reply by 10th July 2025, after which a personal hearing will be granted.

• The final order will be subject to the Supreme Court’s decision on the validity of GST Notifications.

Implications of the Judgement

• Fair Hearing Rights – The ruling reinforces the principle that taxpayers must be given a reasonable opportunity to present their case.

• Pending Supreme Court Decision – The validity of GST Notifications No. 56/2023 remains uncertain until the Supreme Court delivers its verdict.

• Judicial Discipline – The Delhi High Court refrained from ruling on the vires of the Notifications, respecting the pending Supreme Court case.

Conclusion

The Delhi High Court’s decision in M/s Mascon’s case highlights the importance of procedural fairness in GST adjudication. Businesses facing GST disputes should ensure they respond promptly to SCNs and seek legal recourse if denied a fair hearing.

For updates on the Supreme Court’s ruling on GST Notifications, stay tuned to Taxation Advisor legal news platforms.