The Gujarat High Court Rewrites the Debate on Corporate Guarantees Under GST

The Gujarat High Court in the case of Torrent Power, has fundamentally reframed the corporate guarantee debate: first establish the taxable supply, then determine its value. 

While corporate guarantees can constitute taxable supplies under GST, Rule 28(2) cannot use valuation machinery to override actual consideration, and CBIC circulars cannot create taxability. 

The Court also held that a genuine dispute over an evolving tax provision cannot, by itself, become a case of fraud under Section 74.