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Showing 121 to 140 of 1182 Records
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2025 (2) TMI 1062
Admissibility of Section 7 Application - interim order in this Appeal is continuing from 21.02.2024 and a period of one year has elapsed and Appellant has not agreed to all Terms of Settlement - HELD THAT:- The letter dated 18.01.2025, which is a Amendatory Settlement Letter, which was issued by ICICI Bank and the Clause-e, existing clause and amended clause, where both the clauses contemplate that on or before the due date, the entire Settlement Amount shall be released from the Fund Escrow Account to the Collection Account of the ICICI Bank. The settlement between the parties can be arrived only when both the parties agrees with all terms and conditions.
No direction can be issued to modify or change the Terms of Settlement as proposed by the ICICI Bank. The Appeal was disposed of on 22.11.2024, permitting Financial Creditor to file 12A application within the time allowed, which time was extended from time to time. From the facts brought on record, it is clear that as on date, both the parties have not agreed and signed any Settlement Agreement, so that an application under Section 12A can be filed for withdrawal of the CIRP. It is already noticed the submission of the learned Counsel for the Canara Bank, who has claimed that it has also dues on the Corporate Debtor, who also contends that no further indulgence be granted to the Appellant.
Conclusion - The Appellant was not entitled to further extensions for settlement and application rejected.
Application dismissed.
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2025 (2) TMI 1061
Condonation of 104 days delay in refiling the appeal - sufficient cause for the delay in refiling the appeal provided or not - HELD THAT:- In the present case, the impugned order was passed on 30.04.2024. The Appeal was e-filed on 13.06.2024 which was well within period of 45 days including condonation of delay. However, when the defects were notified by the NCLAT registry on 04.07.2024, the Appeal was finally refiled on 23.10.2024 after rectification of defects, with a delay of 104 days. From the explanation we find no reasons except for medical condition with the father of one of the Advocates which occurred sometime on end September. There is total silence from July to end September, 2024. Explanation provided doesn’t inspire much confidence.
There are no sufficient justification to condone the refiling delay of 104 days in time bound IBC proceedings.
Conclusion - Such delay of 104 days in refiling is not reasonable and justifiably explained. The application is therefore dismissed.
Application dismissed.
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2025 (2) TMI 1060
Disqualification under Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 - HELD THAT:- Since there is no proof on record that there was any investigation on the date when the Petitioner applied to avail the benefit under the Scheme and the fact that the orders disqualifying the Petitioner which have been passed are also completely unreasoned and one-line orders, this Court is of the opinion that the Petitioner is entitled to relief. However, the scheme is no longer operational. Under these circumstances, it is directed that the declaration of tax liability of Rs. 11,26,937/- be accepted by the Department.
Subject to the said amount being deposited within a period of one month, the impugned show cause notice dated 31st December, 2020 shall stand quashed. If the said amount is not deposited within one month, the impugned show cause notice dated 31st December 2020 shall automatically revive and the Petitioner is permitted to file a reply to the same. The proceedings under the impugned show cause notice would then proceed in accordance with law.
Petition disposed off.
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2025 (2) TMI 1059
Validity of demand for service tax based solely on the data from Form 26AS - exemption to services provided by the appellant to local government bodies - applicability of Entry No. 12A of N/N. 25/2012-ST - invocation of Extended period of Limitation.
HELD THAT:- The entire show cause notice is based on the data received from Income Tax Department in Form 26AS. Revenue has not examined the data received by them to know whether any service was rendered by the appellant which attracted service tax. When the exemptions were claimed by the appellant before the original authority, he has simply ignored the submissions and confirmed the entire demand as raised in the show cause notice. Therefore, both show cause notices and order-in-original put together have solely relied on the information received in Form 26AS which is the amount received by the appellant.
The issue is no more res integra and it has been decided that only on the basis of data in Form 26AS, Revenue cannot issue show cause notice demanding service tax. Here it is noted that charging Section 66B of Finance Act, 1994 provides for levy of service tax at a specific percentage on the value of service. Section 67 of Finance Act, 1994 provides that where service tax is chargeable on a taxable service with reference to its value, then such value shall be the consideration in money charged by the service provider - it is clear that while determining value of taxable service under Section 67 ibid, such aspect as to the activities which are covered by negative list and which are mentioned in the definition of service as those which are not covered by such definition become important.
Conclusion - The demand cannot be raised merely on the basis of the data received from the Income Tax Department, without any corroborating evidence to substantiate that the value received were in connection with taxable service rendered by the Appellant.
The impugned order set aside - appeal allowed.
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2025 (2) TMI 1058
Non-payment of service tax - appellant had collected amount as service tax but did not deposit the same with the exchequer - failure to properly verify the facts - violation of principles of natural justice - HELD THAT:- The entire demand is based on the information available in profit and loss account and receipts as per Form 26AS. The nature of service rendered by the appellant and the quantum of amount received for rendering a particular service are absent in the proceedings. The value of service is to be determined in accordance with Section 67 and Service Tax (Determination of Value) Rules, 2006 and the same is absent in the entire proceedings.
The charging Section 66B of Finance Act, 1994 provides for levy of service tax at specific rate on the value of service. Section 67 of Finance Act, 1994 provides that where service tax is chargeable on any taxable service with reference to its value, then such value shall be the consideration in money charged by the service provider. Therefore, it is primarily important to determine the value on which service tax shall be levied on a specific percentage and such value should be value of taxable service. Clause (44) of Section 65B of Finance Act, 1994 has provided for definition of service and it has elaborately dealt with a list of activities which shall not be included in such definition. Further, Section 66D of Finance Act, 1994 has provided for negative list of services where activities covered by such negative list do not qualify to be taxable service. Therefore, it is clear that while determining the value of taxable service under Section 67 ibid, such aspect as to the activities which are covered by negative list and activities which are mentioned in the definition of service as those which are not covered by the said definition, become important.
Therefore, for arriving at the amount of service tax not paid or not levied arriving at correct value of taxable service which has not suffered service tax needs to be determined - Further, there are services where entire or part of service tax is to be paid by service recipient. Further, there is a mega notification which provided conditional exemptions to various activities from payment of service tax. In addition, there are Service Tax (Determination of Value) Rules, 2006 which provide abatement to services such as works contract service. Unless all these aspects of Service Tax law are taken into consideration, the allegations of service tax not paid or not levied are not sustainable - No such exercise was done in this case.
Conclusion - The allegations of service tax non-payment or underpayment were not sustainable due to the lack of a comprehensive assessment of these factors. The matter requires detailed verification on all aspects.
The impugned order set aside - appeal allowed.
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2025 (2) TMI 1057
Eligibility to claim interest on the refund granted - refund was sought from the Haryana Housing Board - intere st denied on the ground that refund has been given within 90 days of the application - HELD THAT:- In this case, the refund has been sanctioned in time. As there is no delay in sanctioning the refund, there are no provisions in the statute to grant interest. Tribunal being a creature of statute cannot travel beyond the provisions of Law or statute.
It is found that the appellants have cited so many decisions on the issue of payment of interest. However, the facts of all the cases are different as all the cases involve delayed sanction of refund. The instant case is not about the delay in sanction of refund and consequential payment of interest. Therefore, the cases cited are not applicable as the facts and circumstances are different. Hon’ble High court also took cognizance of the peculiar circumstances of the case. In view of the same, the appellants have not made out any case for grant of interest on the amount refunded.
Conclusion - The refund was processed within the statutory period, and no interest is payable as per the statutory provisions.
Appeal dismissed.
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2025 (2) TMI 1056
No-payment of service tax - appellants were treating the services provided to various institutions like Administrative Training Institute, MCRHRD etc. as Educational Institutions and they have not paid the requisite Service Tax - Section 11B of the Central Excise Act, 1944.
Non-payment of Service Tax - HELD THAT:- The issue about the non-payment of Service Tax on various exempt services has already reached finality. The Department has quantified the same as Rs. 6,48,577/- which has been paid by the appellant before the issue of show-cause notice along with interest of Rs. 1,27,119/-. The appellant has not litigated this amount at the lower appellate stage. Since the amount has been paid along with interest before the issue of show-cause notice, there are no reason to apply Section 78 provisions to impose the penalty on them. The penalty of Rs. 6,48,577/- in respect of this demand set aside.
Quantification of CENVAT reversal - HELD THAT:- Revenue has taken the stand that the appellant is providing taxable service and they have paid Service Tax of Rs. 6,48,577/- towards the same after being pointed out by Audit team. In such cases, the appellant would be eligible for cenvat credit. Therefore, there are force in the submissions of the appellant that while quantifying the cenvat reversal, the turnover towards such taxable service (which was earlier treated as exempt by the appellant) have to be considered to come for the final quantification. For this purpose, the matter is required to be remanded to the adjudicating authority. The appellant is directed to file all their documentary evidence and calculation sheets to fortify their arguments as to what should be the quantification for cenvat reversal. The final quantification if held to be taxable has to be paid by the appellant along with interest. However, considering the facts of the case, the penalty on such Service Tax set aside.
Payment of excess Service Tax during the previous period - it is submitted that appellant has paid some excess Service Tax during the previous period and Department has to adjust the net Service Tax liability is concerned - HELD THAT:- There are no reason to entertain this submission of the appellant. In case they had paid more Service Tax during the earlier years, it was for them to quantify the same and to file a proper refund claim within the framework specified under Section 11B of the Central Excise Act, 1944. The adjudicating authority has correctly held that there is no statutory provision to carry out this kind of adjustment at the adjudication stage. Therefore, this prayer of the appellant is rejected.
Conclusion - i) The appellant had already paid the demanded Service Tax along with interest before the show-cause notice was issued, leading to the penalty under Section 78 being set aside. ii) The appellant should be eligible for cenvat credit. The matter was remanded to the adjudicating authority for a proper quantification of the cenvat reversal, considering the turnover of taxable services previously treated as exempt by the appellant. iii) The appellant's claim of having paid excess Service Tax in previous periods and seeking an adjustment was rejected by the Tribunal, emphasizing the need for proper refund claims under the Central Excise Act, 1944.
The matter is remanded to the adjudicating authority. The adjudicating authority should follow the principles of natural justice and pass a considered decision within 4 months from the date of this order - appeal disposed off by way of remand.
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2025 (2) TMI 1055
Liability of M/s Semi Conductor Laboratory, a Government of India entity, to pay service tax on the Franchisee Services provided to Eon Infotech Ltd for conducting VLSI education and training courses - invocation of extended period of limitation - suppression of facts or not - HELD THAT:- The entire demand has been confirmed by invoking the extended period; it is also found that the additional commissioner has observed that the appellant being a part of Ministry of Space under Union of India, and as such there could have been no malafide intention to evade payment of tax on the part of their official, as none of the employee severally or jointly is benefited by evading the service tax, and none has any personal gain. The Ld. Additional commissioner has also observed that the discrepancy has come to the knowledge of the Department during investigation subsequent to Audit of the appellant conducted by the Departmental officers for the period 16.07.2001 to 31.03.2005 on 13/31.12.2005.
The Order-in-Original, the additional Commissioner has dropped the penalty under Section 76,77 and 78 by holding that malafide intention cannot be inferred on the part of the appellant which is a government of India undertaking. This finding of the Additional Commissioner has not been challenged by the Department and hence has attained finality; once the said finding has attained finality, therefore there is no reason for the Commissioner (Appeals) to come to the conclusion that there is a suppression of fact with intend to evade payment of duty and invokes extended period to confirm the demand.
Moreover, the entire facts were in the knowledge of the department because a lot of correspondences were exchanged during that time when the audit was conducted therefore, alleging suppression of facts with intend to evade duty cannot be alleged against government undertaking.
Conclusion - The Department was well-informed about the appellant's activities, and there was no basis for alleging evasion of duty against a government entity.
The entire demand is barred by limitation - the appeal is allowed only on limitation.
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2025 (2) TMI 1054
Classification of service - Manpower Recruitment and Supply Agency Service or not - assignment of employees by Overseas Entities to the Appellant during the period April 2008 to March 2013 - invocation of Extended period of limitation.
Whether the appellant is required to discharge Service Tax under Reverse Charge Mechanism for services received under the category of ‘Management Consultancy Services”, ‘Manpower Recruitment and Supply Agency Service’ during the relevant period involved in this appeal in the light of the judgment of Hon’ble Supreme Court in Northern Operating Systems Pvt. Ltd. [2022 (5) TMI 967 - SUPREME COURT]? - HELD THAT:- In the Cost Reimbursement Agreement for Assignment referred above between the Appellant and their Overseas Company reveals that the terms and conditions are more or less similar to the one referred to in para 3 of the judgment of the Hon’ble Supreme Court in Northern Operating Systems Pvt. Ltd - In the present case also, the appellant was in need of personnel for facilitating the business operations in India and the overseas company, which has such personnel, who possesses the requisite qualification and skill desired to employ such persons on exclusive basis and the overseas company has duly consented to depute such personnel to India. The deputed personnel while under employment with the appellant was not in any manner subjected to any kind of instruction or control or direction or supervision of the overseas company and required to report to the appellant’s management in India. They function solely under the control, direction and supervision of appellant and in accordance with the policy, rules, guidelines applicable to the employees of the appellant. The appellant shall have the sole right to take punitive steps against misconduct, negligence, fraud or unsatisfactory performance of work by the seconded personnel during employment with the appellant company and also have the right to terminate the employment. The details of the salary to be paid by the appellant to the assignees are enumerated in the said agreement.
A careful reading of the sample ‘Reimbursement Agreement’ and also the contract of the employment, letter of employment etc., there are no major difference from the facts stated in the judgment of Hon’ble Supreme Court in Northern Operating Systems Pvt. Ltd.’s case, where it was held that 'it is held that the assessee was, for the relevant period, service recipient of the overseas group company concerned, which can be said to have provided manpower supply service, or a taxable service, for the two different periods in question (in relation to which show cause notices were issued).'
Whether Extended period of limitation is invokable in confirming demand for the period from April 2008 to March 2013 and penalty is imposable when the service tax demand along with interest is paid before issuance of show-cause notice on ITSS and Commercial Training or Coaching Services? - HELD THAT:- The service tax is applicable on the amount paid by the Appellant to M/s. Tesco, Bangalore for providing manpower during the relevant period April 2008 to March 2013; however, it was also held by the Hon’ble Supreme Court in the said case that extended period of limitation cannot be invoked and hence, demand has to be computed for the normal period of limitation. Further, since the Appellant had paid the amount of service tax, on being pointed out relating to ITSS service and commercial training and coaching service, before issuance of show-cause notice with interest, there are no reason for invoking extended period of limitation against the appellant. Consequently, penalties imposed on all the appellants are unsustainable and accordingly, set aside.
Conclusion - i) The Service tax is applicable on the amount paid by the appellant for manpower supply during the relevant period, but only for the normal period of limitation. ii) The extended period of limitation could not be invoked, aligning with the Supreme Court's decision in Northern Operating Systems Pvt. Ltd.
Matter remanded to the adjudicating authority to redetermine the liability for the normal period of limitation - appeal allowed by way of remand.
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2025 (2) TMI 1053
Clandestine removal - Fraudulent availment of CENVAT Credit - Area based exemption - it is alleged that the claim of procurement of mentha oil by the manufacturers situated in Jammu & Kashmir and North East were bogus - denial of cross-examination of witnesses - violation of princiles of natural justice - HELD THAT:- It is found that the evidence available in this regard has already been discussed by the Tribunal in the series of cases and it has been concluded that the evidences are not enough to sustain the demands. When the allegation of bogus procurement of raw material, manufacture and clearance by the Jammu based units cannot be established, allegation of bogus procurement from these units by Meerut based manufacturers cannot be sustained.
The allegation leveled against the appellants do not sustain. The averment by the learned Authorized Representative that some of the supplies made may be fake is of no help at this stage. It was open to the Department to collect all the evidences and make precise allegations while issuing the Show Cause Notice. The bus having been missed, Revenue cannot open a new front to continue the litigation on the facts and records which were not part of the impugned proceedings. The charge of clandestine removal is a grave one. It has to be leveled with accuracy though mathematical precision cannot be expected.
Co-ordinate Bench of the Tribunal, in the matter of Nova Petrochemicals v. CCE, Ahmedabad-II, [2013 (11) TMI 626 - CESTAT AHMEDABAD] held 'There should be tangible evidence of clandestine manufacture and clearance and not merely inferences or unwarranted assumptions.'
Appeal allowed.
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2025 (2) TMI 1052
Classification of goods - Fuel Filter assembly, Water Pump Assembly, Cylinder Head Sub-Assembly and Cylinder liner stud Assembly which are sub-assemblies and components of High Horse Power locomotives for Railways - yo be classified under Chapter Heading 8607 as parts of railway locomotives or under other headings as suggested by the Department? - applicability of Exemption N/N. 12/2016-CE dated 01.03.2016 - time limitation.
Classification of goods - HELD THAT:- Section 37B Order issued earlier on 01.09.1993 instructing classification of Steel/Aluminium Water Tanks for supply to Railways either under Chapter 73 or Chapter 76 of the CETA, 1985 was withdrawn consequent to the Order of the Tribunal in M/s. Sri Ram Metal Works [1997 (11) TMI 265 - CEGAT, MADRAS] that the provision of water in a coach was a necessity and the water tank became part of the coach after fitment. The decision is in keeping with the relevant Section Notes and Rules for Interpretation of Tariff as well as judgments of the Hon'ble Supreme Court and decision of the Tribunal in identical cases. Therefore, the Lower Appellate Authority did not commit any error in falling back upon Board's Circular dated 20.10.2000.
In the case of M/s. G.S. Auto International Ltd. [2003 (1) TMI 700 - SUPREME COURT], a question arose as to whether items such as Sprint Centre Bolts with Nuts, Spring U Bolt with Nuts, Spring U Clamps with nuts and plates, Spring Shackle Pin (Shackel Bolt) with Nuts and Spring Shackle Pin (Spring Pin) specifically designed for use in automobile vehicles merited classification as parts of general use under CH 73.08 or as parts and accessories of motor vehicles under CH 87.08.
CETA 1985 is enacted on the basis and pattern of the HSN. For resolving any dispute with reference to classification, reference to HSN is needed. However, when Section or Chapter Notes are clear and unambiguous, resorting to HSN Notes is not required. The principles governing classification are given in the General Rules of the Interpretation of Tariff. As per Rule 1 of the said General Rules, the classification is to be determined in terms of the headings and any relevant Section or Chapter Notes. If determination of classification is still elusive, recourse can be taken to Rules 2 to 6. If the dispute cannot be resolved in the manner said above, reference to HSN Notes is required. In this case, applying Note 3 of Section XVII coupled with the judgment of the Hon'ble Supreme Court in the case of M/s Westinghouse Saxby and Rule 3(a) of the General Rules for Tariff Interpretation, the issue has been resolved by classifying the products under CH 8607. Therefore, any further reference to HSN Notes is not legally warranted.
The products manufactured and supplied by the respondent are rightly classifiable under CH 8607 of CETA and the ratio of the decision of this Bench in the case of M/s. Shakthi Tech Manufacturing India Pvt. Ltd. applies to this case entitling the respondent to avail concessional rate of duty under the amending Notification No. 12/2016-CE dated 01.03.2016.
Time limitation - HELD THAT:- Even in the Customs advisory contained in Instruction No. 01/2022-Customs dated 05.01.2022 to which a reference is made in Para 26 of the appeal memo, in Para 3 the Board says that "In the context of the divergent practises arisen, it is noted that the classification of 'parts' of goods falling under Section XVII of the Customs or Central Excise Tariff is a complex issue." Thus, the factum of admission in Board's circular that the classification of parts is a complex issue confirms the view that the issue is not free from doubt. Therefore, there are no hesitation to hold that the demand raised invoking extended period of limitation under Section 11(4) CEA, 1944 is wholly without any basis.
Conclusion - i) The classification of the respondent's products under Chapter 8607 affirmed, based on the sole or principal use test as articulated in Note 3 to Section XVII and supported by the Supreme Court's decision in Westinghouse Saxby Farmer Ltd. ii) The demand raised invoking extended period of limitation under Section 11(4) CEA, 1944 is wholly without any basis.
Appeal of Revenue dismissed.
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2025 (2) TMI 1051
CENVAT Credit - denial on the ground of non-submission of required documents i.e. STTG Certificates which according to the Department is a primary and essential documents to avail the Cenvat credit - extended period of limitation - HELD THAT:- This issue was considered by the Division Bench of Mumbai Bench, CESTAT in the case of JSW Steel Ltd. [2022 (3) TMI 913 - CESTAT MUMBAI] wherein after considering the Rule 9 of the Cenvat Credit Rules the Tribunal has held 'If the requirements of Rule 3 are satisfied, the credit could not have been denied. Further, Rule 9(2) read with Rule 4A of the Service Tax Rules provides that any document which contains the details as prescribed under Rule 4A shall be considered as a proper duty paying document for all the purposes including availment of cenvat credit.'
The Ld. Commissioner (Appeals), Ludhiana in the case of M/s Salasar Steel Structural Pvt. Ltd. on identical issue has allowed the Cenvat Credit and has held that Cenvat credit cannot be denied merely on account of non production of STTG Certificates.
Extended period of limitation - HELD THAT:- The Revenue has not been able to establish any of the ingredients mentioned in Section 11A(4) - extended period cannot be invoked.
Conclusion - i) The denial of Cenvat credit based on the absence of STTG Certificates was not valid. ii) Extended period cannot be invoked.
Appeal allowed.
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2025 (2) TMI 1050
Refund of excess tax deposited during appellate proceedings - infringement of Articles 14, 19(1)(g), and Article 265 of the Constitution of India or not - HELD THAT:- The respondents cannot retain the amounts deposited by the petitioner pursuant to condition imposed by the appellate authority for stay of the assessment order and contend that there is no necessity to refund the same. If the actual tax assessed from the petitioner is much less than the amount which the petitioner had deposited at the time of filing the appeal and seeking stay, retention of the balance after the assessing officer, post remand, reduced the demand drastically, would undoubtedly amount to unjust enrichment on the part of the respondents and would be violative of Article 14 and Article 265 of the Constitution of India.
The respondents are directed to refund the amounts deposited by the petitioner after adjusting the same towards the tax finally assessed post remand by the assessing authority for the Assessment Year 2013-14 and Assessment Year 2014-15 with interest at the rate of 9% per annum from 09.01.2021 till the date of actual payment. The respondents shall also pay cost of Rs. 2,00,000/- to the petitioner for unjustly retaining the said amount for the last four years. The cost as well as the refund shall both be paid to the petitioner within six weeks from the date of receipt of a copy of this order.
Petition allowed.
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2025 (2) TMI 1049
Dishonour of Cheque - vicarious liability of directors of the accused company - whether the petitioners had knowledge or were involved in the transaction alleged in the complaint? - HELD THAT:- It is relevant to note that this Court can quash complaints under the NI Act at the pretrial stage in the exercise of its inherent jurisdiction under Section 482 of the CrPC if such unimpeachable material is brought forth by the accused persons which indicates that they were not concerned with the issuance of the cheques or that no offence is made out from the admitted facts.
The Hon’ble Apex Court in the case of Rathish Babu Unnikrishnan v. State (NCT of Delhi) [2022 (4) TMI 1434 - SUPREME COURT] had discussed the scope of interference by the High Court against the issuance of process under the NI Act and held that 'Situated thus, to non-suit the complainant, at the stage of the summoning order, when the factual controversy is yet to be canvassed and considered by the trial court will not in our opinion be judicious. Based upon a prima facie impression, an element of criminality cannot entirely be ruled out here subject to the determination by the trial Court. Therefore, when the proceedings are at a nascent stage, scuttling of the criminal process is not merited.'
In line with the dictum of the Hon’ble Apex Court in Rathish Babu Unnikrishnan v. State (NCT of Delhi), thus, while exercising the power under Section 482 of the CrPC to quash a complaint at the pre-trial stage, it is pertinent for this Court to examine whether the factual defence is of such impeachable nature that the entire allegations made in the complaint is disproved.
In accordance with Section 141 of the NI Act, in instances where the principal offender under Section 138 of the NI Act is a company, every person who at such time when the cheque was dishonoured, and no subsequent payment was made, was in charge of the business of the company, and was responsible for the conduct of business, is deemed to be guilty of the offence under Section 138 of the NI Act.
It is trite law that a person cannot be arrayed as an accused person merely due to association with the accused company in capacity of a Director.
In the present case, the evidence presented by the petitioners was sufficient to disprove the allegations without the need for a trial, as the complaint lacked specific averments about the petitioners' roles - the petitioners were not in charge of and responsible for the conduct of the business of the company at the time the offence was committed. Therefore, they could not be held vicariously liable under Section 138 read with Section 141 of the NI Act.
Conclusion - The evidence presented was sufficient to demonstrate that the directors were not responsible for the conduct of the business of the company at the time of the offence.
Petition allowed.
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2025 (2) TMI 1048
Rejection of appeal filed by the petitioners on the ground of delay of 8 days in filing - HELD THAT:- Having considered that there is a marginal delay in filing the appeal and also noting that although the petitioners have a further right to prefer an appeal before the Appellate Tribunal, by reasons of the Appellate Tribunal not being constituted, the petitioners have been compelled to approach this Court. The appeal has not been adjudicated on merits.
Having regard to the peculiar facts made out and noting that some explanation is available for the delay, it is opined that the matter ought to be remanded back to the appellate authority for a decision on merits and accordingly the order dated 27th June, 2024 passed by the appellate authority is set aside.
Petition disposed off by way of remand.
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2025 (2) TMI 1047
Challenge to adjudication order - adjudication order was passed without giving an opportunity of hearing - violation of principles of natural justice - HELD THAT:- On going through the voluminous document placed, it is found that the matter provides adjudication into facts. It is not simple adjudication but deep and thorough adjudication into facts are required to be done and therefore, it is not one of the exceptional cases, where the appellant/assessee should be permitted to bypass the statutory appellate remedy.
The appellant is directed to file a statutory appeal within a period of 30 days from the date of receipt of server copy of this judgment and order and if the appellant does so, the appellate authority shall entertain the appeal without rejecting the same on the ground of limitation.
Appeal dismissed.
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2025 (2) TMI 1046
Valid service of SCN - attachment to the Summary of the Show Cause Notice (SCN) in Form GST DRC-01 - absence of a proper SCN - violation of principles of natural justice - HELD THAT:- From the perusal of the records, it would show that in the Summary of the Show Cause Notices issued in GST DRC-01 to the petitioner in the writ petition, there is a mention therein that there is a Show Cause Notice attached. It is the case of the respondents that the said attachment wherein determination of tax is mentioned is the Show Cause Notice. The question therefore arises as to whether the said attachment can be said to be a Show Cause Notice as per the mandate of both the Central Act as well as the State Act and the Rules made therein under. It would be apposite to take note of that in all these cases, the Summary of the Show Cause Notices have been issued in terms with Section 73.
The Proper Officer is required to issue a Show Cause Notice, therefore, the Show Cause Notice is required to specifically mention the reason(s) and the circumstances why the provision of Section 73 had been set into motion. The person against whom the said Show Cause Notice is issued would only have an adequate opportunity to submit a representation justifying that the prerequisites for issuance of Show Cause Notice is not there if and only if the reason(s) for issuance of the Show Cause is specifically mentioned in the Show Cause Notice - Section 73 further stipulates that upon consideration of the representations, if any, the Proper Officer shall pass the order under Section 73(9) determining the amount of tax, interest and penalty.
This Court is of the view that the Summary of the Show Cause Notice along with the attachment containing the determination of tax cannot be said to be a valid initiation of proceedings under Section 73 without issuance of a proper Show Cause Notice. The Summary of the Show Cause Notice is in addition to the issuance of a proper Show Cause Notice. Under such circumstances, this Court is of the opinion that the impugned order challenged in the instant writ petition is contrary to the provisions of Section 73 as well as Rule 142 (1) (a) of the Rules as the said impugned Orders were passed with issuance of a proper Show Cause Notice.
Whether Rule 26 (3) can be applicable to Chapter-XVIII when the said Sub-Rule on refers to Chapter-III? - HELD THAT:- In the case of M/s Silver Oak Villas LLP [2024 (4) TMI 367 - TELANGANA HIGH COURT], the learned Division Bench of the Telangana High Court had applied Rule 26 (3) of the Rules of 2017 even to Chapter-XVIII of the Rules of 2017. In the case of A.V. Bhanoji Row (supra), the learned Division Bench of the Andhra Pradesh High Court held that the signatures cannot be dispensed with and Sections 160 and 169 cannot save an order, notice, communication which did not contain a signature.
This Court has duly perused the Summary of the Show Cause Notices wherein the petitioner was only asked to file his reply on a date specified. There was no mention as to the date of hearing and the Column was kept blank. However, the petitioner had sought for an opportunity of hearing which was however not given - The mandate of Section 75(4) of both the Central and State Act are safeguards provided to the assessees so that they can have a say in the hearing process.
Conclusion - The issuance of the Summary of the Show Cause Notice, Summary of the Statement and Summary of the Order do not dispense with the requirement of issuance of a proper Show Cause Notice and Statement as well as passing of the Order as per the mandate of Section 73 by the Proper Officer. As initiation of a proceedings under Section 73 and passing of an order under the same provision have consequences. The Show Cause Notice, Statement as well as the Order are all required to be authenticated in the manner stipulated in Rule 26 (3) of the Rules of 2017. Accordingly, this Court is of the opinion that the Impugned Order challenged in the writ petition are in violation of Section 75(4) as no opportunity of hearing was given.
This Court while setting aside the impugned Order-in-Original dated 28.04.2024, grants liberty to the respondent authorities to initiate de novo proceedings under Section 73, if deemed fit for the relevant financial year in question - Petition disposed off.
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2025 (2) TMI 1045
Rectification u/s 254 - Characterization of income - nature of income derived by the petitioner from PGHH/sister concern of the petitioner - "income from other sources" or "income from house property" - HELD THAT:- ITAT’s jurisdiction under Section 254 [2] of the IT Act is limited. It is not akin to a substantial review. This Court clarified this position in an earlier round when the ITAT had similarly exceeded its jurisdiction. The issue of whether the income receivable by the petitioner from PGHH was income from house property or income from other sources was writ large before this Court in the Revenue’s pending appeal.
ITAT, exercising powers u/s 254[2] of the IT Act, could not have reviewed its earlier finding on this issue. ITAT’s impugned order deserves to be set aside accordingly.
However, we clarify that this judgment and order would in no way interfere with this Court deciding on whether the income receivable from PGHH should be classified as "income from house property" or "income from other sources" in revenue’s appeal under Section 260-A of the Act.
ITAT exceeded its jurisdiction under Section 254 (2) in deciding such an issue.
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2025 (2) TMI 1044
Deduction u/s 10A and depreciation on computer peripherals - petitioner states that with respect to the two corporate tax issues, the respondent has failed to pass any appeal effect order till date, and therefore, the proceedings have become time barred with respect to these two issues -
As submitted that once the ITAT set aside the assessment order, the demand arising from the said order stood extinguished and it was the duty of the AO to delete the outstanding demand from the portal of the petitioner. However, despite a lapse of more than 6 years from the date of the ITAT order setting aside the assessment order, the AO has failed to delete the demand from the portal - HELD THAT:- In view of the submissions of the learned counsel for the parties as also the statement of learned counsel for Revenue, we direct that the order dated 26.06.2015 passed by the ITAT be given appeal effect to and the consequential benefits with statutory interest, if applicable, be released forthwith, in accordance with law.
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2025 (2) TMI 1043
Validity of order passed u/s 250 - penalty proceedings initiated against the petitioner were decided in a manner prejudicial to the natural justice - denial of personal hearing - Rejection of exemption claimed u/s 10 (23C) (iiiab) - HELD THAT:- In the instant case, the petitioner has moved a rejoinder before the Appellate Authority requesting for a personal hearing but the said request was not considered by the Appellate Authority. If the application/request was made for personal hearing by the petitioner before the Appellate Authority, the Income Tax authority ought to have allowed the said application by arranging for video conferencing argument. At least in the instant case, it stands established the request from the petitioner was made before the Appellate Authority but the Appellate Authority did not give opportunity of hearing to the petitioner.
Therefore, this Court is of the considered view that there is a violation of principle of natural justice and if the defect of principle of violation of natural justice has occurred in the initial stage of proceedings, it cannot be cured at the stage of appeal. No doubt, the petitioner has a right to avail the statutory appellate remedy but when the impugned order was passed by the respondent No. 2 in violation of principle of natural justice, it cannot be alleviated. WP allowed.
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