Latest Updates on Income Tax, GST, Customs, Corporate Laws & more
Income Tax:Application u/s 197 for issuance of a Lower Deduction of Tax Certificate - The High Court observed that, a plain reading of Rule 28-AA makes it clear that the 'satisfaction' needs to be recorded/determined by A.O. after taking into consideration the four factors mentioned in sub-rule (2) of Rule 28-AA. Thus, it is not the subjective satisfaction of A.O., but an objective satisfaction which must be based on Clauses (i), (ii), (iii) and (iv) of sub-rule (2) of Rule 28-AA. - Since impugned orders are passed in clear violation of Rule 28-AA, the High Court held that decision making process adopted by the respondents runs contrary to the requirement of law, i.e. Rule 28-AA. - Matter restored back for readjudication.
GST:Refund of the amount of tax deposited by him on the cancelled (old) registration - inadvertent / bona fide error - The court concludes that the petitioner is entitled to the refund of tax mistakenly deposited under the cancelled registration number. It sets aside the orders rejecting the refund claim and directs the refund along with permissible interest within a specified timeframe.
GST:Condonation of delay in filing appeal before the appellate authority - Delay of 73 days - The High court dismissed the writ petition, finding it devoid of merit. It affirmed the exclusivity of the limitation provisions outlined in Section 107 of the GST Act and emphasized the importance of adhering to statutory timelines in tax-related matters.
GST:Classification of service - provision of service including supply of material amounting to transfer of property in goods - The Authority determined that the specific services provided do not fit within the more narrowly defined categories of SAC 998621 ('Support Services') or SAC 9983, as claimed by the Appellant. - The Appellate Authority (AAAR) upheld the AAR's classification to the extent mentioned and modified the ruling concerning the applicable tax rate. The appeal was disposed of accordingly, affirming the classification under SAC 9954 and applying an 18% GST rate to the services provided under the EPC contract.
GST:Scope of Advance Ruling application - classification of product Keer Kokil - The AAR had classified "Keer Kokil" as 'unmanufactured tobacco' under CTH 24012090, attracting GST @ 28% and Compensation Cess @71%. - The AAAR found that the appeal filed by CGST, Udaipur against the letter dated 11.07.2023 issued by AAR, Rajasthan was not maintainable as it was filed against a decision under Section 104 of the CGST Act, 2017, which is outside the purview of AAAR's domain.
GST:Scope of Advance Ruling - The appellant sought clarification on the classification of the service recipient, Jaipur Vidyut Vitran Nigam Limited (JVVNL), as a "Government Entity" and the applicability of tax exemption provisions. However, the appellate authority (AAAR) upheld the decision of the Authority for Advance Ruling, Rajasthan, which declined to give a ruling based on the completion of the supply and timing of the application.
GST:Classification and rate of GST - parts of fuel injection pumps - Application of General Rules for Interpretation (GRI), along with the Customs Tariff Act and HSN explanatory notes - The AAR ruled that all the mentioned parts of fuel injection pumps are classifiable under HSN 84139190. - The AAR determined that the parts of fuel injection pumps are not specifically covered under any entry prescribing a 28% GST rate. Therefore, they fall under the residuary entry SI. No. 453 of Schedule III of the IGST Goods Rate Notification, attracting an 18% GST rate.
GST:Availment of ITC of differential IGST paid post on-site audit by Customs authorities - To be treated as voluntary paid or not - The AAR ruled that the differential IGST paid by the applicant does not qualify for ITC under Section 17(5) of the CGST/TNGST Act, 2017. The authority found that the case involved willful misstatement by the applicant to evade tax, discovered during an audit. It was determined that since the differential IGST paid was in connection with an audit finding of willful misstatement or suppression of facts, it fell under the restrictions of Section 17(5), which denies ITC in cases where tax has been paid in accordance with the provisions of sections 74, 129, and 130.
GST:Appropriate classification of the product ‘Clear Bloat Glass’, which is imported and traded by the Applicant - The AAR emphasized that the tin layer in float glass was incidental to the manufacturing process and did not serve the intended purpose of providing an additional layer with specific properties. - Chapter notes are crucial for understanding the scope and classification criteria for different types of glass products - the AAR ruled that the appropriate classification for 'Clear Float Glass' is under the tariff sub-heading 7005 29 as 'Others.' Furthermore, it specified that at the eight-digit level, tinted variations would be classifiable under CTH 7005 2910, and non-tinted variations under CTH 7005 2990 of the Customs Tariff Act, 1975.
GST:Classification of the services - bio-mining and waste remediation services - The AAR ruled that the services were classified under SAC 9994, which encompasses sewage and waste collection, treatment, disposal, and other environmental protection services, attracting a GST rate of 18%. - The services provided were considered "pure services" to a local authority (Tumakuru City Corporation) related to functions entrusted to a Municipality under Article 243W of the Constitution. Therefore, these services were exempt from GST.
GST:Classification of supply - supply of service or not - activity of supply of food by the Applicant - Tariff/Service code - restaurant service or Outdoor Catering Service? - The AAR ruled that the proposed activity of supply of food by the Applicant falls under 'other contract food service' under SAC 996337, attracting 18% GST, as per Notification No. 11/2017-CT(Rate) dated 28.06.2017 amended by Notification No. 20/2019-CT(Rate) dated 30.09.2019.
Income Tax:Validity of reassessment order - Notice sent on wrong (old) E-mail ID - The petitioner company had two email addresses, one used until 2019 and another operational since then. - The notice under Section 148A (b) was sent to the old email address, despite the petitioner's consistent use of the new email address since 2020. - The High Court held that the notice issued under Section 148A(b) to the incorrect email address was invalid, thereby rendering subsequent proceedings void. The court quashed the order passed by the Assessing Authority and the consequential notices for reassessment.
Income Tax:Bad Debts - Loans advanced to the Group Company utilized for purchase of properties and shares - The High court holds that it's not necessary for the assessee to establish that the debt went bad during the relevant previous year. If the assessee can demonstrate a bona fide belief that the debt had become bad and is written off accordingly, the claim should be allowed. - The High court concurs with the ITAT's finding that the nature and quality of the transaction, not just how it's recorded in the books, are crucial in determining its character. The fact that the transaction was recorded as a loan in the books does not negate its potential qualification as a bad debt.
Income Tax:TDS u/s 194I or 194C - storage charges paid by assessee - TDS @ 20% - The ITAT concluded that assessee is liable to deduct Tax at Source u/s 194C - The High court determined that the storage tanks in question did not qualify as land or building under Section 194I of the Act. It concluded that the payments made by the assessee were not subject to tax deduction at source under Section 194I. - The court upheld the decision of the ITAT, disposing of the appeals in favor of the assessee.
Income Tax:Unexplained cash credits u/s 68 - Interest expenditure debited as interest on securities - allegation of involvement in multi crore securities transactions scam of nineties infamously known as Harshad Mehta Scam, Assessee got labelled as party under the Special Court's (TORTS) Act, 1992 - The ITAT examined each addition separately, considering the evidence and explanations provided by the assessee. It concluded that the additions were not justified due to satisfactory explanations and evidence presented by the assessee. - The High Court dismissed the appeal, finding no merit in the revenue's contentions.
Income Tax:Addition u/s 68 - unexplained cash credit - Onus to prove - The High court noted that the assessee had provided sufficient evidence, including bank statements, cash-flow statements, and other relevant documents, to support their claim regarding the source of cash deposits and capital introduced in the partnership firm. - It was observed that the Assessing Officer did not provide any adverse findings or reasoning to rebut the evidence submitted by the assessee. The court emphasized that evidence cannot be disregarded based on mere surmise and conjecture. - The court allowed the appeal of the assessee and ordered the deletion of the addition.
Income Tax:Non following Procedure laid down u/s 144C - Action of the AO/NeAC not proposing all the variation in the Draft Assessment Order - The Tribunal agrees with the appellant's argument that the AO/NeAC's actions were procedurally flawed, as they proposed additions in the final order without including them in the Draft Assessment Order, thus denying the appellant the opportunity to file objections before the Dispute Resolution Panel. - The ITAT allows the appeal of the assessee, highlighting the procedural irregularities and jurisdictional flaws in the assessment process.
Income Tax:TP Adjustment - interest charged on foreign currency loan - The Tribunal ruled in favor of the Assessee, finding that the interest charged on the loan to its Associated Enterprise was at an arm's length rate. As a result, the appeal of the Assessee was allowed, and the addition sustained by the CIT(A) was directed to be deleted.
Income Tax:Addition based on entries appearing in a diary seized from the assessee - Penalty proceedings u/s. 269SS, 269T and 271AAB - The CIT(A) held that the AO's findings were not sustainable as they lacked material evidence and reasoning. The CIT(A) noted that the transactions in the seized diary were related to the partnership firms' projects, and the assessee was maintaining accounts for the partners of these firms. The CIT(A) also considered the disclosure made by the partnership firms while deciding the penalty. - The ITAT dismissed the appeal filed by the Revenue, affirming the CIT(A)'s order.
Income Tax:Revision u/s 263 - The ITAT observed that there was no evidence of lack of enquiry by the Assessing Officer regarding the claim of deduction under Section 57. The case was opened for limited scrutiny, and the assessee had responded to queries during assessment proceedings. - The tribunal held that the PCIT erred in holding the assessment order as erroneous and prejudicial to the interest of the revenue. Revision order quashed.
Income Tax:Scope of Limited Scrutiny - Accrual of income - Addition towards advance fees and deposits from old students - AO attempt to convert limited scrutiny into complete scrutiny - ITAT found that CIT(A) had elaborately dealt with the issues in dispute and had granted relief to the assessee both on legal issue as well as on merits. As per the scheme of the Act, AO if he desires to convert limited scrutiny into complete scrutiny, he has to obtain prior permission from the competent authority to do so and only then could assume jurisdiction to examine other issues. - Consequently, revenue appeal dismissed.
Income Tax:Addition u/s 68 - unexplained cash credit - capital contribution in cash by the partners - While deleting the additions, the Tribunal held that, if the Ld. AO was not convinced with the source of amounts deposited by the partners, then such addition could have been made in the hands of such partners by invoking the relevant provisions of law but no addition was called for in the case of assessee firm, who have discharged its primary onus u/s 68 by providing the details of the partners from whom such funds were received.
Income Tax:Condonation of delay in filing the appeal - delay of 326 days - sufficient cause - After considering the arguments and perusing the materials, the Tribunal found that the delay was attributable to the actions of the former Tax Consultant and accepted the reasons provided by the assessee as sufficient cause for the delay. The Tribunal cited precedents emphasizing the need to decide appeals on merits rather than dismissing them on technical grounds unless there is gross negligence or mala fide intention.
Income Tax:Non-prosecution of appeal by assessee - Undisclosed investment - as alleged assessee could not prove identity, genuineness of the transaction and creditworthiness of the parties - The appeals filed by the assessee were dismissed by the tribunal due to non-appearance, lack of cooperation, and failure to provide necessary documentation.
Income Tax:Addition on the account of Section 24 v/s business head u/s 37 - interest paid on housing loan - The ITAT upheld the CIT(A)'s decision, stating that if the interest is paid on capital borrowed for the purpose of business, it should be allowed as a deduction under the business head, and not under income from house property.
Customs:Navigating Trade Restrictions: India's Stance on North Korea Exports and Imports
IBC:Deadline Adherence in Insolvency Claims: The Supreme Court on Enforcing Arbitration Awards Amidst Insolvency
IBC:Resolution Plan Approvals: The Supreme Court's Clarification on NCLT and NCLAT's Jurisdiction in Insolvency Resolution.
Income Tax:Navigating Tax Exemptions u/s 80P: The Supreme Court's Verdict on Cooperative Societies vs. Banks
Customs:Supreme Court Verdict on Pre-Import Condition and IGST Exemptions: A Legal Analysis
Indian Laws:Understanding Beneficial Ownership: A Landmark Admiralty Case in India
Customs:Beneficial Ownership, Beyond Baggage in Customs Law: Seizure of foreign currency
SEZ:Expanding Trade Horizons: The 2023 Amendment to SEZ Rules for Gem and Jewellery Units
GST:The Significance of Signature: A Landmark Decision on GST Assessment Orders
Income Tax:Principles of Natural Justice in Tax Litigation: Unraveling the Significance of Cross-Examination Rights in Tax Cases
Income Tax:Deadline Extension for Processing E-Filed Tax Returns: Refund Claims on Income Tax Returns
DGFT:Deadline Extended for Pharmaceutical Track and Trace System Implementation
Corporate Law:MCA Announces Establishment of Central Processing Centre at IMT Manesar
Customs:Export Obligation Compliance: Detailed SOPs for EPCG and Advance Authorization Holders
IBC:IBBI Circular Update: Key Takeaways for Insolvency Professionals and Stakeholders
Income Tax:Modes of filing of ITR: Amendments to Rule 12 of the Income Tax Rules 1962
GST:Finance Bill, 2024 Insights: The Expansion of Input Service Distributor's (ISD) Role in GST
Indian Laws:Understanding Burden of Proof in Cheque Bounce Cases: Insights from a Landmark Judgment
Indian Laws:Analysis of Vicarious Liability under Section 141 of the NI Act in Partnership Firms: Liability in Cheque Bounce Cases
Income Tax:Navigating Legal Timelines: The Impact of Incomplete ITBA Orders on Appeal Limitations.
Income Tax:Navigating the Thin Line Between Charity and Commerce: Amendment of Trust Deed and Compliance with Section 13(1)(c)
Income Tax:Changing Objectives of Registered Societies: Exemption u/s 11 and survival of the Registration u/s 12A r.w.s 12AA
Income Tax:Judicial Scrutiny of Residential Status and Jurisdictional Shift in Income Tax Cases
Income Tax:Scrutinizing the Genuineness of Gifts in Income Tax Law: Taxability of Gift u/s 68
Income Tax:Interpreting TDS Liability u/s 194-I against Lease Payments: A Legal Analysis of Security Deposit vs. Rent for Tax Purposes
FTP- Amendment in Para 2.39 of the Foreign Trade Policy, 2023
PMLA- Reporting Entities notified for Aadhaar authentication service of the Unique Identification Authority of India u/s 11A of the Prevention of Money-laundering Act, 2002
ADD- Seeks to amend notification No. 14/2019-Customs(ADD) dated 25.03.2019, in order to change the name of the producer from 'M/s Mitsui Phenols Singapore Pte. Ltd' to 'M/s INEOS Phenol Singapore Pte. Ltd' pursuant to DGTR recommendation
IT- Panjab University, Chandigarh under the category of ‘University, college or other institution’ for ‘Scientific Research’ for the purposes of clause (ii) of sub-section (1) of section 35
Indian Law- Seeks to bring in force provisions of Bharatiya Nyaya Sanhita, 2023 , except the provision of sub-section (2) of section 106
Indian Law- Seeks to bring in force provisions of Bharatiya Sakshya Adhiniyam, 2023
Indian Law- Seeks to bring in force provisions of the Bharatiya Nagarik Suraksha Sanhita, 2023
SEZ- Central Government de-notifies an area of 4.4723 hectares at Village Gwal Pahari, Gurugram in the State of Haryana
CST- Designated Indian Carrier - M/s SNV Aviation Private Limited (Akasa Air).
FTP- Extension in Import Period for Yellow Peas under ITC (HS) Code 07131010 of Chapter 07 of ITC (HS), 2022, Schedule -l (Import Policy)
SEZ- Central Government de-notifies area at Kuvakolli Village, Vardaiah Palem Mandal, Chittoor District, in the State of Andhra Pradesh.
CGST- Seeks to notify “Public Tech Platform for Frictionless Credit” as the system with which information may be shared by the common portal based on consent under sub-section (2) of Section 158A of the Central Goods and Services Tax Act, 2017.
IT- Corrigendum - Notification No. 19/2024 dated 31st January, 2024
Cus (NT)- Appointment of Common Adjudicating Authority for the purpose of adjudication of finalization of Provisional Assessment in SVB case w.r.t. M/s Royal Canin India Pvt. Ltd
Cus- Seeks to amend notification No. 55/2022 - Customs, dated 31.10.2022 and notification No. 64/2023 - Customs, dated 07.12.2023, in order to remove end date on export duty on Parboiled Rice and to prescribe specified condition on imports of Yellow Peas.
DGFT- Amendments in Standard Input Output Norms (SION) C-831 for export of Stainless Steel Seamless Tubes/ Pipes (Cold Finished)
Customs- Vide Public Notice No. 87/2023-24 dated 05.10.2023, under the provision of Section 10 & 8(b) of the Customs Act, 1962, the additional Liquid Cargo Jetty LB03/04 of M/s. JNPA, consisting of unloading platform of size 108m x 50m, mooring dolphins 04 Nos. & pump house 49m x 20m located at Jawaharlal Nehru Port, Village Nhava Sheva, Taluka Uran, Dist. Raigad, Maharashtra has been notified as Customs Area for unloading of Liquid Cargo.
Customs- Invitation of applications for empanelment of Chartered Engineers for examination/valuation of Second / Old & Used machinery/goods etc. in the jurisdiction of Jawaharlal Nehru Custom House, Mumbai Customs Zone - II- Regarding.
Customs- Declaration of Additional area as Customs Area under Section 8 (b) of Customs Act , 1962 for M/s Triway Container Freight Station Pvt. Ltd. – Regarding.
DGFT- Relief in Average Export Obligation in terms of the para 5.17(a) of Hand Book of Procedures (HBP) of FTP, 2023
Insolvency and Bankruptcy- Enhancing Transparency and Stakeholder Engagement in Liquidation Process
Insolvency and Bankruptcy- Deposit and withdrawal of unclaimed dividends and / or undistributed proceeds in accordance with regulation 46 of the Insolvency and Bankruptcy Board of India (Liquidation Process) Regulations, 2016 (Liquidation Regulations)
DGFT- Suspension of inoperative SIONs w.e.f. 1st April, 2024
Customs- Order under Rule 5 of the Customs (Assistance in Value Declaration of Identified Imported Goods) Rules, 2023 for the Linear Alkyl Benzene (LAB) – reg.
SEBI- Centralization of certifications under Foreign Account Tax Compliance Act (FATCA) and Common Reporting Standard (CRS) at KYC Registration Agencies (KRAs)
Customs- Bonds - To furnish KYC details of the company / individual like PAN, GSTN details, contact numbers of authorized person, bank account details of the company and Aadhar details of the proprietor/managing partner/director for the various bonds executed by importers under Custom Law- Reg.
Central Excise- Rescind Instruction dated 30.08.2023 issued vide F. No. 275/06/2022-CX.8A. (Pt.I)
Customs- Compliance of imported consignments of Boric Acid (Technical Grade) with notified Bureau of India Standards (Standards for Boric Acid) Order, 2019
Companies Law- Deployment and usage of Change Request Form (CRF) on MCA-21
DGFT- Clarification regarding Notification No. 60 dated 13.02.2024.
⇒ Credible Communication – Perspective and Thoughts (Padma Bhushan Professor Emeritus Dr. M.V. Pylee Memorial Lecture - delivered by Shri M. Rajeshwar Rao, Deputy Governor, Reserve Bank of India on Monday, February 26, 2024, at the School of Management Studies; Cochin University of Science and Technology, Kochi)
⇒ Union Finance Minister Smt. Nirmala Sitharaman to inaugurate EDI enablement at Land Customs Stations of North East and also preside over handing over ceremony of seized antiquities by Customs to ASI tomorrow
⇒ Infrastructure Finance Secretariat (IFS), Department of Economic Affairs (DEA), holds workshop on ‘Public Private Partnership (PPP) Project Structuring Toolkit for Water and Sanitation Sector’ in New Delhi
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Forum - Recent Replied Issues
Jiva Seva is Shiva Seva:
Service to humanity is Service to God
May I be born again and again, and suffer thousands of miseries so that I may worship the only God that exists, the only God I believe in, the sum total of all souls—and above all, my God the wicked, my God the miserable, my God the poor of all races, of all species, is the special object of my worship.
- Swami Vivekananda, CW, 5:137