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Showing 141 to 160 of 1445 Records
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2024 (3) TMI 1305
Order passed against a non-existent entity - amalgamation/merger of the erstwhile company with the successor company - HELD THAT:- A cursory glance of the draft assessment order dated 21.12.2019 clearly reveals that against the name of the assessee, the Assessing Officer has mentioned “Boeing International Corporation India Ltd.” Whereas, in the column showing address of the assessee, the Assessing Officer has mentioned “M/s. Boeing International Corporation India Ltd. (3rd Floor) DLF Centre, Sansad Marg, New Delhi (India)”. The aforesaid facts clearly show that the assessment order has been passed in the name of Boeing International Corporation India Ltd., which as on the date of passing of the draft assessment order has become a non-existent entity. Undisputedly, against the draft assessment order, assessee raised objections before learned DRP. Interestingly, the directions of learned DRP is in the name of Boeing India Pvt. Ltd., the successor company. However, the final assessment order has again been passed by the Assessing Officer in the name of Boeing International Corporation India Ltd., the erstwhile company. More interestingly, the name of the successor company i.e. Boeing India Pvt. Ltd., nowhere appears in the body of the final assessment order.
Also further relevant to observe, the PAN appearing both in the draft and final assessment orders is of the erstwhile company, Boeing International Corporation India Ltd. and not of the successor company Boeing India Pvt. Ltd. Thus, the facts on record establish beyond doubt that both the draft as well as final assessment orders have been passed in the name of a non-existent company.
Applying the ratio laid down by the Hon'ble Supreme Court, in case of Maruti Suzuki [2019 (7) TMI 1449 - SUPREME COURT] and Sony Mobile Communications India Pvt. Ltd [2023 (2) TMI 1074 - DELHI HIGH COURT] to the factual matrix of the issue, we have no hesitation in holding that the impugned assessment order passed in the name of a non-existent entity is void ab initio. Accordingly, it is quashed.
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2024 (3) TMI 1304
TP Adjustment - Provision of Administrative and Agency Services - Determination of Arm's Length Price (ALP) - allocation of expenses relating to income streams between two segments - HELD THAT:- As seen that the assessee has allocated common expenses and has also given basis of apportionment. We find that the CIT(A) has put a doubt on whether segmental accounts are to be accepted and the only reason given by the authorities, as we understand from the respective orders, is that it is not audited.
Merely because segmental accounts are not audited cannot make them untrustworthy without pointing out any specific defect/error/fallacy in them. Observations of the ld. CIT(A) that non compete fee and good will has not been allocated is not accepted as the TPO himself has not allocated these expenses.
Assessee has not only provided segmental account but has also allocated expenses and has given basis of allocation. We do not find any merit in the stand taken by the TPO/AO as confirmed by the ld. CIT(A). We, accordingly, direct the AO to delete the impugned adjustment. Appeal of assessee allowed.
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2024 (3) TMI 1303
Classification of imported goods - Reformate - whether the goods to be classified under CTH 2710 12 19 or under CTH 2707 50 00? - Tribunal held that Reformate would merit classification under CTH 2707 50 00 - HELD THAT:- We are not inclined to interfere with the impugned judgment and order passed by the Customs, Excise & Service Tax Appellate Tribunal.
Civil Appeal is, accordingly, dismissed.
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2024 (3) TMI 1302
Suspension of operations of handling the cargo of third parties - Non-issuance of a show cause notice - Validity Of order passed by the Commissioner of Customs (G) - failure to comply with the provisions of Regulations 5 & 10(1)(m) of the SCMTR, 2018 and Section 33, 34, 39, 40 & 41 of the Customs Act, 1962 - confiscation of goods - penalty - HELD THAT:- As the petitioners are handling the cargo of third parties and if the order-in-original is not suspended, it would be a serious and an irreparable prejudice not only to the petitioners but also to third parties with whom the petitioners have contracts to handle their cargo. Thus, in our opinion, it is in the interest of justice that the proceedings are remanded to the Commissioner of Customs for a fresh order to be passed after an opportunity of hearing is granted to the petitioners after issuance of a show cause notice, so that the petitioners are made aware in regard to the allegations intended to be made against the petitioners for such action to be resorted and on which the petitioners can be heard by the Adjudicating Officer.
Thus, for such course of action to be adopted, the impugned order dated 14 March 2024 would be required to be quashed and set aside, as also the consequences emanating from the said order namely the Public Notice dated 20 March 2024 would also be required to be not acted upon. Ordered accordingly.
We, accordingly, dispose of this petition in terms of our aforesaid observations.
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2024 (3) TMI 1301
Levy and collection of Cost recovery charges - Validity Of Notification No.26/2009 issued by Central Board of Excise and Customs - Duties, functions and obligations of custodian appointed under section 45 of the Customs Act, 1962 - Regulation 5(2) of the Handling of Cargo in Customs Areas Regulations, 2009 - Regulation ultra vires to section 157 and 158 of the Customs Act, 1962 - HELD THAT:- It is submitted that even if the same are treated to be a fee, there is no justification for levy of fees as no service is being rendered to the Company. In the absence of any element of quid pro quo, it is urged that the decisions of Bombay and Delhi High Courts in Mumbai International Airport Private Limited [2014 (10) TMI 508 - BOMBAY HIGH COURT] and Allied ICD Services Limited [2018 (8) TMI 1610 - DELHI HIGH COURT] are distinguishable and the learned Single Judge of this Court has rightly held that the 2009 Regulations are ultra vires the Customs Act, 1962. In support of the aforesaid submissions, reliance has been placed on the decisions of the Supreme Court in Government of Maharashtra vs. Deokar’s Distillery [2003 (3) TMI 727 - SUPREME COURT] and Gupta Modern Breweries vs. State of Jammu and Kashmir [2007 (4) TMI 684 - SUPREME COURT].
From a perusal of Section 157 of the Customs Act, it is evident that Section 157 does not enumerate any specific provision under which cost recovery charges i.e., the amount of salary payable to the officials of the Customs Department, who are deployed at the Airport who perform their statutory duties, can be recovered. The 2009 Regulations have been framed in exercise of the powers conferred under Section 141 and Section 157 of the Customs Act. From a close scrutiny of the aforesaid provisions of Sections 141 and 157, it is evident that there is no express statutory provision conferring authority on the appellants to levy cost recovery charges. In the absence of any special authorization to levy cost recovery charges, appellants have no authority to impose cost recovery charges by means of a Regulation. The inevitable conclusion is that the 2009 Regulations are ultra vires the Customs Act, 1962.
Therefore, the officers of the Customs Department, who were employed at the Airport between the years 2008 and 2013, were deployed to perform their statutory duties. The levy of cost recovery charges, which is in fact salaries payable to the customs staff deployed at the Airport is in the nature of administrative charges and is a tax. It cannot be exacted from the respondent without any statutory provision. Therefore, the same is also violative of Article 265 of the Constitution of India. Even assuming that the said levy to be a fee, the same cannot be recovered from the respondent as no services are provided to it by deployment of additional staff at the Airport between the years 2008 and 2013.
Contention that the Company at the time of application seeking appointment as Custodian has furnished an undertaking that it shall abide by the 2009 Regulations is concerned, suffice it to say that the Company subsequently on 06.05.2007 and 22.11.2007 had submitted applications seeking to waive the condition Nos.10 to 13 of Circular No.34/2002. Therefore, the undertaking furnished by the Company does not bind it in the facts of the case.
Thus, we agree with the conclusion of the learned Single Judge that the impugned 2009 Regulations are ultra vires the Customs Act.
In the result, the Appeal fails and the same is hereby dismissed.
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2024 (3) TMI 1300
Levying Container Storage Charges - ground rent - Storage of confiscated containers to treated as Goods or not - declaration of Custodian at Kandala Port Trust issued from the office of the Commissioner of Customs, the Custom House, Kandala - Section 45(1) of the Customs Act, 1962 - HELD THAT:- The contention of the learned counsel for the petitioner that the Kandala Port Trust could not have charged ground rent from the petitioner as the containers could not have been confiscated by the Customs authorities, as they did not fall within the meaning of ‘goods’, is found to be misconceived. The reference to the decision of the Apex Court in Chairman, Board of Trustees, Cochin Port Trust [2020 (8) TMI 300 - SUPREME COURT] is found to be misplaced.
No ground rent can be levied on the petitioner shipping agent, once the Kandala Port Trust became the custodian of the goods with the confiscation by the Customs department. There are inherent fallacy in the arguments of the learned counsel for the petitioner, inasmuch as, the said notification only decides the liability of the Kandala Port Trust for being custodian of the Custom department and Clause 18 of the said notification can only be interpreted to mean that the Kandala Port Trust would not charge any rent/ demurrage on the goods/containers detained from the Customs department.
There are no error in the order passed by the learned single Judge in holding that the petitioner has failed to make out a case that there was an error on the part of the Kandala Port Trust in levying container storage charges from the petitioner.
Appeal disposed off.
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2024 (3) TMI 1299
Revocation of CHA License - Customs Broker resorted to unprofessional methods while clearing the goods imported vide Bill of Entry - Fabrication of redemption fine and penalty in the order in original - time limit stipulated in Regulation 20 of CBLR, 2013 - whether the Order directing for continuation of suspension issued by the Department dated 20.12.2013 is legal and proper - HELD THAT:- The prohibitary order was issued on 05.06.2013. If such date is considered as the date on which the Department had come to know of the incident, the Show Cause Notice ought to have been issued on or before 05.12.2013. In the present case, the Show Cause Notice is issued only on 20.12.2013 which is beyond the period of 90 days prescribed in Regulation 20 of CBLR, 2013. Further, it has to be noted that though an inquiry officer was appointed by the Department, no inquiry report (offence report) was submitted by the Department. The Hon’ble Jurisdictional High Court in the case of Sabin Logistics Pvt. Ltd. [2019 (4) TMI 1713 - MADRAS HIGH COURT] had held that the compliance of the time limit as prescribed in the Regulation is mandatory. This Tribunal in the case of M/s. Trade Wings Logistics India Pvt. Ltd. [2023 (7) TMI 892 - CESTAT CHENNAI] had occasion to consider a similar issue and held that when the Department has not complied with the time limit, the order issued for revocation of licence or the order issued for continuation of the suspension licence cannot sustain.
Thus, we are of considered opinion that the Order issued by the Department directing for continuation of suspension of the licence cannot sustain and requires to be set aside.
In the result, the impugned order is set aside. The appeal is allowed with consequential relief, if any, as per law.
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2024 (3) TMI 1298
Exemption from Basic Customs Duty - Import of Lithium-Ion Batteries falling under Customs Tariff Heading 85076000 - Time limitation for submission of Country of Origin certificate - the goods are originating from the Republic of Korea - HELD THAT:- The Commissioner (Appeals) ought not to have rejected the appeals on the ground of being time barred. There is no requirement to file a petition for condonation of delay as the said period during the Pandemic has been excluded by the Hon’ble Apex Court in IN RE: COGNIZANCE FOR EXTENSION OF LIMITATION [2022 (1) TMI 385 - SC ORDER]. The rejection of appeals as time barred cannot be sustained and requires to be set aside. The matter is remanded to the Commissioner (Appeals) for reconsideration of the issue of benefit of exemption notification.
In such reconsideration of the issue, the Commissioner (Appeals) shall look into the Country of Origin certificate issued retrospectively as per the Customs Tariff (Determination of Origin of Goods under the Preferential Trade Agreement between the Governments of the Republic of India and the Republic of Korea) Rules, 2009 to ascertain the eligibility of exemption. The decision of Tribunal in the case of THE COMMISSIONER OF CUSTOMS VERSUS M/S. KOMOS AUTOMOTIVE INDIA PVT. LTD. [2023 (9) TMI 1446 - CESTAT CHENNAI] on similar issue shall also be looked into by the appellate authority.
The impugned orders are set aside - The matter is remanded to the Commissioner (Appeals) who shall dispose of the case within a period of two months from the date of receipt of this order - Appeal allowed by way of remand.
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2024 (3) TMI 1297
Revocation of Licenced Customs Broker Licence - violation of Regulations 10(d), 10(e) and 10(i) - forfeiture of security deposit - Penalty - Appraiser at the CFS Chennai demanding and accepting undue advantage from the Custom House Agents (CHA) for issuing Let Export Order / out of charge order on the consignments and registration of bills pertaining to import/export - HELD THAT:- The entire proceedings are based on CBI report, which in turn is based on the slips and vouchers recovered from the customs officials, the appellant and various statements of the employees. These are only allegations/charges arrived at a preliminary stage which is yet to be corroborated with the evidences and to be finalised by the CBI. Moreover, based on the same set of facts, the Customs Brokers are penalised differently either by imposing only penalty or by revocation of license along with imposition of penalty as is the case of the present appellant.
Based on the facts and allegations levelled against the appellant and the facts placed on record do not in any way prove the contravention of clause 10(d) and (e) of the Regulations and to invoke clause 10(i), the allegations/charges are yet to be proved by the competent court. Moreover, the decisions relied upon by the appellant clearly observed that the appellant cannot be penalised for the actions of the employee when there is no proof on record to establish that the conduct of the employee was authorised by the appellant.
Thus, the entire proceedings being based on CBI report which is pending adjudication are pre-mature and without any basis. We set aside the impugned order and allow the appeal.
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2024 (3) TMI 1296
Valuation - export duty - Whether the Appellant/Assessee is liable to pay customs duty on the FOB value, on export of iron ore fines considering the same as cum-duty value or otherwise - HELD THAT:- We find that the issue is no longer res integra as has been decided in catena of rulings against the Appellant/Assessee holding that Cum Duty Value cannot be used for arriving at the value for levy of export duty. In the following rulings of this Tribunal, this view has been taken in Sesa Goa Ltd vs CCE,C & ST,[2014 (4) TMI 658 - CESTAT KOLKATA] and Essel Mining & Industries Vs CCE, [2017 (4) TMI 87 - CESTAT KOLKATA].
Thus, we dismiss the Appeals and uphold the Impugned Orders.
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2024 (3) TMI 1295
Value addition - Duty-free import of gold - Replenishment of gold under the ‘replenishment scheme’ from DIL against export of gold jewellery - Not fulfilled the mandatory requirements - balance quantity of gold supplied - duty demand - confiscation - Penalty u/s 114A - limitation for adjudication - Violation of the conditions of Notification No. 57/2000-Cus.
i) Whether or not the subject ‘kadas’ were manufactured by a ‘fully mechanized’ process as declared by BL/JR in the shipping bills.
ii) Whether or not the claim made by BL/JR that the value addition was “2.05%” of the export FOB value, is correct?
HELD THAT:- Gold has been supplied by DIL by way of replenishment and there is no allegation that matching quantum of gold has not been exported as required under Notification No. 57/2000-Cus. In the said Notification, in the second proviso, it clearly provides that Nominated Agency supplying gold to the exporter is liable only for difference (shortage) between the quantity issued and that contained in the exported jewellery or articles. We further find that the value addition norm was required to be checked by the proper officer of customs on presentation of goods with the export documents. Admittedly, all the shipping bills along with the export invoices were approved by the proper officer of customs on being satisfied as to the declarations and requirements. Thus, we find that no case of violation of the conditions of Notification No. 57/2000-Cus is made out in the facts and circumstances. Thus, we hold that the Appellant – DIL has not violated the provisions of Customs Act read with Notification No. 57/2000-Cus.
From the facts on record and the evidence recorded, it is evident that the jewellery in question which have been exported, was manufactured by the said job worker by fully mechanised process. The Govt. approved jewellery valuers, who are experts, have also certified so. Further, the said valuers have not stood by their statements recorded during investigation. The Chartered Engineer has also certified the process as fully mechanized. Therefore, the value addition here would be 2% and not 3.5% as held in OIO.
Value addition - It is obvious that the interpretation of DGFT Authority would prevail over Customs Authority, which has also been admitted by DGEP in their circular (quoted supra). Therefore, if that norm is followed instead of the calculation method adopted by the Revenue, the requirement of Notification No. 57/2000 is met, in as much as, the conditions for duty-free imports stand fulfilled and therefore, there is no short levy.
Evidential value of email clarification - It is also noticed that this mail has come in response to DIL’s letter dt.09.10.2020. Since it is an official mail, it cannot be held as having no authority to clarify as indicated in the said mail. If Revenue had any doubt about genuineness of this mail, they could have cross-checked from the DGFT as regard bonafide of this mail. It is obvious that the original Circular dt.27.09.2019 also, in Para 3, has clarified that for the purpose of value addition, inputs in ‘B’ in Para 4.38 means ‘the duty-free’ (either on advance or replenishment basis). Therefore, it would be obvious that the term ‘dutyfree’ used here in conjunction with either on advance or replenishment basis, would obviously mean imported inputs or in other words, what has been clarified in email is inputs imported duty free. Therefore, the objection taken by the Revenue on this ground does not hold any substance.
Further, we have held that the process of manufacture is fully mechanised, we find that the wastage allowable was 0.9%. Further, the required value addition is 2% as per the table in Para 4.61 & 4.62 in the Handbook of procedures. Thus, we find that the whole allegation by revenue of not achieving minimum value addition is misconceived and bad.
There is no allegation in the SCN that the customs authorities – proper officer did not perform their duty diligently or have abetted with the exporter. Further, all duly endorsed documents were submitted by DIL to jurisdictional Customs officer for final assessment and closure of the bond and the said bonds were closed without raising any doubt or query based on endorsement of proper officer of customs, at the time of export of gold jewellery. Thus, the whole allegation is not substantiated and has got no legs to stand.
We further find that there is also no allegation that the Appellant have exported gold jewellery using less quantum of gold, than declared or made by some other metal other than gold. Also, there is no allegation regarding purity of gold as declared. Thus, we hold that the provisions of section 113(i) for confiscation are not attracted, there being no case of any misdeclaration.
DIL as the Nominated agency - We hold that there is no case of any violation against DIL under the Customs act, read with the notification. We further take notice of the fact that the bonds given by the Nominated agency – DIL to the customs, have been duly discharged or closed by the proper officer after due verification of relevant documents under the scheme.
Jewellery valuer - We find that, the allegation against him would also not stand. It is evident that this Appellant has valued the gold jewellery under export, in the export shed in presence of the Customs officials. He has certified certain other parameters including weight and purity but that does not make him accomplice. No case of any suppression or collusion in the valuation report is made out. In this view of the matter, we allow the appeals of the jewellery valuer and set aside the penalties imposed on him.
Consequently, we hold that no penalties are imposable on any of the parties/Appellants. Accordingly, all the penalties imposed on all the Appellants are set aside.
Limitation for adjudication - The Revenue has however put on record an Order dt.21.08.2019, whereby, in the case of SCN dt.31.08.2018, the approval for extension of one year as per first proviso to Sec 28(9) of Customs Act was recorded by the competent authority. Further produced a notification viz., 06/2019-CUS dt.27.02.2019, under sub-sec (8) of Sec 28 of Customs Act, whereby in respect of SCN dt.26.09.2018 of DIL was extended by further period of one year. The Appellants have relied on the judgment of Gautam Spinners vs CC (Import) [2023 (386) ELT 62 (Del)] to substantiate their claim that regardless of causative factors, the notice needs to be adjudicated within the statutory period. Be the case as may be, since the entire issue has been decided on merit itself, we keep the issue of limitation open without expressing any view on this aspect.
Further, as we have allowed the appeals on merits, we also leave the question of limitation open.
All appeals are allowed with consequential benefits, including entitlement to receive the balance quantity of gold, which has not been released by the Nominated agency – DIL to the Appellant/exporter M/s BL/JR under the replenishment scheme.
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2024 (3) TMI 1294
Admission of section 9 application - Operational Creditors - debt payable or not - prior existence of the dispute between the parties or the pendency of other proceedings filed elsewhere - effect upon the liability of Corporate Debtor in respect of the unpaid operational debt.
Whether based on the documentary evidence which were furnished by the Corporate Debtor whether any debt was payable at all and what is the basis on which it has been claimed to have been paid? - HELD THAT:- A careful scrutiny of the contract agreement dated 03.09.2012 particularly in the context, to its contents provided in clause I.10 and I.40, dealing with the schedule of payment agreed to show that it does not envisage the payment by the Corporate Debtor to the Operational Creditor, would be depending only upon the receipts of amount made from M/s. GVK Coal (M/s. Tokisud Company Pvt. Ltd.). Hence, as far as the purchase order and the contract agreement are concerned, they will have to read only for the contract purposes and not to the liability of payment of the dues to the Operational Creditor. Thus, it could be rightly inferred that prior dues left unpaid by the Corporate Debtor to the Operational Creditor which necessitated invocation of Section 9 of the Insolvency and Bankruptcy Code, 2016, was justified in the eyes of law.
Whether there is a prior existence of the dispute between the parties or the pendency of other proceedings filed elsewhere? - whether such will at all have any effect upon the liability of Corporate Debtor in respect of the unpaid operational debt? - HELD THAT:- The said issue has been dealt with by the Hon’ble Apex Court in matters of Mobilox Innovations Private Ltd. vs Kirusa Software Pvt. Ltd. [2017 (9) TMI 1270 - SUPREME COURT], wherein it was ultimately held that the Adjudicating Authority at the stage when it is examining an application under Section 9, will only have confine itself to determine whether there happens to be an operational debt, exceeding amount prescribed under the Code and further the only precaution which is required to be taken is that based on documents on rigour as furnished, the aspects of liability of dues stand established and that if any of the ingredients as aforesaid exists, the application under Section 9 would be sustainable.
As per the records, there is nothing on record to otherwise that the Corporate Debtor had any intention to pay the amount due prior to the date the Demand Notice was issued by the Operational Creditor and that there was existence of any dispute with Operational Creditor by the Corporate Debtor prior to the receipt of demand notice served as a mandatory notice in terms of Section 7 of the Insolvency and Bankruptcy Code, 2016. Hence, since despite the demand notice the amount therein was not paid by the Corporate Debtor in all to the Respondent/Operational Creditor. the existence of amount due to be paid becomes an admitted fact, more so in the light of the aforesaid fact that the Corporate Debtor has not raised any dispute as per terms of the purchase order - the Adjudicating Authority while admitting the petition under Section 9 of the Insolvency and Bankruptcy Code, 2016 and dealing with the aspect of moratorium under Section 14 of the Code had not committed any legal error of law and fact in relation to the guidelines for the purpose of arrears or claim raised under Section 9 of the Code.
The act of the Adjudicating Authority in declaring the moratorium for the purpose of Section 14 of the Code, in the light of provisions contained under Section 9 dealing with the aspect of remittance of the dues claimed, does not appear to suffer from any apparent error of law or a fact on record which could call for acceptance of the defence taken by the Corporate Debtor or questioning the existence of the dues to be paid and/or admitting the existence of any prior dispute regarding the amount due remaining unpaid.
The admission of proceedings by the Adjudicating Authority under Section 9 of the Insolvency and Bankruptcy Code do not suffer from any apparent error of fact and law, calling for any interference while exercising Appellate jurisdiction under Section 61 of the Insolvency and Bankruptcy Code, 2016 - Appeal dismissed.
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2024 (3) TMI 1293
Seeking grant of Interim Stay of the Sale Notice - sale of assets of the Corporate Debtor and the property of one Mr. S. Srinivasan (Guarantor) - HELD THAT:- This Tribunal, pertinently points out, that obviously, the Learned Counsel for the Appellant/Petitioner, is not desirous of assailing the subsequent E-auction Notice dated 15.02.2024, (being the later development, after the earlier Auction Notice dated 16.09.2023) and in the absence of any challenge to the subsequent E-auction Notice dated 15.02.2024, then in law, it amounts to waiver, Acquiescence and also Estoppel By Conduct, of the Appellant/Petitioner.
The instant Comp. Appeal filed by the Appellant, is only an exercise in futility/otiose one, in the considered opinion of this Tribunal. As such, this Tribunal is not inclined to entertain the instant Comp. Appeal and Dismisses the same, at the Admission stage, without traversing, or delving deep into the subject matter in issue.
Company appeal dismissed.
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2024 (3) TMI 1292
Ownership of leasehold rights over the subject plot - demand for enhanced land cost was raised much before initiation of CIRP - Applicability of clean slate principle - Seeking quashing of demand notice - direction to to issue ‘No Objection Certificate’ (NOC) for the subject plot - whether in the factual matrix of this case, the successful resolution applicant can be granted ownership of leasehold rights over the subject plot without payment of dues to the respondent?
HELD THAT:- Hon’ble Supreme Court in the MUNICIPAL CORPORATION OF GREATER MUMBAI (MCGM) VERSUS ABHILASH LAL & ORS. [2019 (11) TMI 844 - SUPREME COURT] has held that the provisions of Section 238 of IBC, 2016 do not override the rights of Municipal Corporation of Greater Mumbai (MCGM) to control and regulate how its properties are to be dealt with. It is public duty of MCGM to control and regulate how its properties are dealt with. The provisions of Section 238 could be of importance when the properties and assets are of debtor and not when a third party like MCGM are involved and therefore in the absence of approval in the terms of Sections 92 and 92-A of the Mumbai Municipal Corporation Act, 1880 (MMC), the Adjudicating Authority under IBC, 2016 cannot create a fresh interest in respect of MCGM’s property and lands.
From the perusal of the aforesaid judgment, it follows that the rights of the Public Sector/ State Land Development Authorities on assets owned by them cannot be overridden by provisions of IBC, 2016 and any transfer to the successful Auction Purchaser or Successful Resolution Applicant has to be in accordance with the terms and conditions of the original allotment or lease deed or policy of the Authority.
The demand for enhanced land cost was raised much before initiation of CIRP and evidently, it was not brought to the notice of the IRP or the CoC. Even the pending litigation before Civil Judge (Senior Division), Ludhiana regarding the subject plot was not brought to the notice of the CoC and the successful Resolution Applicant.
The protective umbrella of IBC, 2016 for CIRP cannot be extended to an extent that public authorities are asked to part with their assets without full payment of their dues or without compliance to terms and conditions of the sale or lease deed or their transfer policy. The ‘clean slate principle’ will not apply to the factual matrix of the present case, where there was prior demand from public sector land authority which was also not disclosed during CIRP to the IRP or the CoC.
The Adjudicating Authority in the impugned order has rightly noted that the payment demanded by the respondent is to clear the defect in the title of the land itself, and is not linked to the CIRP proceedings.
There are no reason to interfere in the order of the Adjudicating Authority - appeal dismissed.
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2024 (3) TMI 1291
Approval of the Resolution Plan - Requirement of liability of PF and ESI dues to be paid in Full - Claim u/s 7A, 7Q, and 14B of the Employees' Provident Funds & Miscellaneous Provisions Act 1952 - Approval of Resolution Plan in which only amount proposed was amount u/s 7A - HELD THAT:- Similar issue decided in REGIONAL PROVIDENT FUND COMMISSIONER, VATWA, EMPLOYEES PROVIDENT FUND ORGANIZATION VERSUS SHRI MANISH KUMAR BHAGAT, (RESOLUTION PROFESSIONAL OF M/S. PERFECT BORING PVT. LTD.) , M/S. N.A. ROTA MACHINES & MOULDS INDIA [2023 (10) TMI 535 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL , PRINCIPAL BENCH , NEW DELHI]. One of the claims which was not paid by the Resolution Plan in the said case was also claim under Section 14B of the Employees Provident Fund Miscellaneous Provisions Act, 1952. This Tribunal taking note of the claim under Section 14B took the view that the Central Board is empowered to waive the damages under Section 14B as per the scheme under the 1952 Act. It was observed that Section 14B referred to recommendation by Board under the 1952 Act. The said Act having been repealed and now repealed by the IBC Code, the power of recommendation can be exercised by NCLT.
This Tribunal ultimate directions in paragraph 18(i) (c) permitted the SRA to make an application to Central Board for waiver of 100 per cent damages along with the copy of the order. In the facts of the present case, we are inclined to grant liberty to SRA to make an application to the Central Board for waiver of the amount of damages under Section 14B as provided in Section 14B of the 1952 Act.
Now coming to another part of the claim which was admitted in the CIRP i.e. amount under Section 7Q amounting to Rs.75,62,576/- - the said amount is required to be paid by SRA to the Appellant.
The SRA- Respondent No.3 is directed to make payment of amount of Rs.75,62,576/- within the period of two months from today to the Appellant which was admitted claim under Section 7Q - With regard to amount admitted under Section 14B of Rs.1,05,63,927/-, liberty granted to the SRA to make an application to the Central Board to waive 100% damages levelled under Section 14B.
The impugned order passed by the Adjudicating Authority is affirmed.
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2024 (3) TMI 1290
Rejection of Section 7 application - rejection on the ground that there is non-compliance of order dated 11.08.2022 and 05.12.2022 - direction for publication of notice in two leading newspapers not complied with - issuance of fresh notice to the Respondents and directing the Appellant to serve notice along with copy of petition to the Respondent by all modes and file proof of service.
HELD THAT:- From the order dated 11.08.2022, it is noted that notices were issued and direction was to issue notice by paper publication in two leading newspapers. On 16.09.2022, the Respondent have appeared before the Adjudicating Authority through counsel and time was allowed to them to file vakalatnama and counter affidavit and thereafter again on 05.12.2022 fresh notices were directed to be issued. Affidavit of service was already filed by the Appellant on 08.08.2022, however, thereafter order for publication was issued. The Appearance of counsel on behalf of the Corporate Debtor on 16.09.2022 clearly indicates that the Corporate Debtor was well aware of the proceedings.
In the present appeal, inspite of issuance of notice and publication in newspapers, no one appeared for the Corporate Debtor - the Adjudicating Authority committed error in rejecting the Section 7 application due to non-compliance of order dated 11.08.2022 and 05.12.2022. The Corporate Debtor having appeared before the Adjudicating Authority through counsel who took time for filing vakalatnama and counter affidavit, the Adjudicating Authority ought to have dismissed the application for non-compliance.
The order dated 02.02.2023 set aside - Section 7 application is revived before the Adjudicating Authority to be heard and decided in accordance with law - appeal disposed off.
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2024 (3) TMI 1289
Imposition of penalty u/s 76 and 78 of the Finance Act, 1994 - Recovery of service tax - business auxiliary services - payments made by the Appellants to foreign commission agents - period from 2003–04 to 31.12.2007 - HELD THAT:- There is no dispute as regards the fact that the Appellant have paid service tax along with interest upon intimation by the Department. It is the claim of the Appellant that they were under bonafide belief as regards their liability to pay tax and when they were intimated about their obligation, they have discharged the tax liability along with interest there upon. It is found that it is settled legal position as enumerated by the Hon’ble Gujarat High Court in the case of M/S RAVAL TRADING COMPANY VERSUS COMMISSIONER OF SERVICE TAX [2016 (2) TMI 172 - GUJARAT HIGH COURT] that penalty under section 76 and 78 cannot be imposed simultaneously.
Similar view has been upheld by this Tribunal in the case of MD ENGINEERS VERSUS C.C.E. & S.T. -VADODARA-I [2023 (8) TMI 903 - CESTAT AHMEDABAD] wherein it was held that the appellant have been imposed penalty under section 76 and 78 simultaneously.
The penalty under Section 76 and 78 cannot be imposed simultaneously. Accordingly, penalty under section 76 should not be imposed on the Appellant when they have paid the service tax along with interest whereas penalty under section 78 and other penalties is upheld.
The impugned order is modified to the above extent. The appeal is partly allowed.
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2024 (3) TMI 1288
Benefit of N/N. 1/2006 – ST dated 01.03.2006 - Industrial or Commercial Construction Services - appellant to provide the materials such as cement, steels etc., and in terms of some it was required for the appellant to provide the services along with the materials - Cenvat credit was being availed - HELD THAT:- The issue settled by this Tribunal in the appellant's own case M/S SMP CONSTRUCTIONS PVT LTD VERSUS C.C.E. & S.T. -VADODARA-II [2018 (8) TMI 179 - CESTAT AHMEDABAD] pertains to the condition as prescribed under Notification No. 1/2006-ST as regards exemption and benefit of abatement where it was held that the condition of the Notification was complied with, merely in some of the contract the appellant had availed the cenvat credit, and the same has no effect on the service where the exemption Notification No. 1/2006-ST was availed.
Thus, following the above observations of this Tribunal, the adjudicating authority can reconsider the issue afresh based out of the factual matrix of the present case taking into account the submissions made by the Appellant as regards the effect of availment of Cenvat credit and abatement where credit was not availed at all. Therefore, the issue needs to be remanded back to the adjudicating authority for reconsideration.
The appeal is allowed by way of remand to the adjudicating authority.
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2024 (3) TMI 1287
Levy of service tax - services of sales promotion and marketing provided outside India - service in the present case is provided in the taxable territory of India or not - failure to fulfil the condition as provided in clause (d) of the Rule 6A as per which the place of provision of service is outside India - Section 66B of the Finance Act read with Rule 6A of the Service Tax Rules - HELD THAT:- The said issue has been settled by this Tribunal in Solvay Specialities India Pvt Limited Versus Commissioner of Central Excise & ST, Surat-II [2023 (4) TMI 828 - CESTAT AHMEDABAD] in the Appellant’s own case where it was held that the service of the appellant in present case being absolutely identical, under the same set of facts, it amounts to Export of Service hence it is not liable to service tax. Accordingly, the demand on the Export of Service i.e. Business Auxiliary Service is not sustainable hence the same is set-aside.
The services have been provided by the Appellant which have been received outside India thereby establishing that the said services have been exported. The issue is no longer res-integra.
The impugned order set aside - appeal allowed.
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2024 (3) TMI 1286
Refund of CENVAT Credit - services related to Information Technology (ITSS) - export of services or not - eligibility to avail CENVAT credit when the supplier of services pays service tax on a mistaken notion of law - credit can be denied for the difference in the ST-3 Returns and CENVAT credit Register or not.
Whether the appellants are eligible for claiming refund on the ITSS Services claimed to have been rendered to M/s Agilent Technologies, Singapore? - HELD THAT:- On going through the agreement, one gets understanding that the same are not in the field of ITSS. An addendum of a later date cannot be construed to be an order valid during the relevant period. Therefore, there was no specific order placed by M/s Agilent Technologies, Singapore, on the appellant, for providing ITSS Services during the relevant period. It is found that the addendum and the certificate issued much later than the impugned period that to after rejection of the refund cannot take place of an “Order” as envisaged in the proviso to Rule 3(1)(iii) of Export of Service Rules, 2005. It is found that the argument of the appellants that development of Software Services rendered by the appellants is linked to the R & D Agreement is not acceptable.
The appellants have also taken the plea that prior to 16.05.2008, they have claimed refund of Business Support Services and not in respect of ITSS Services and thus, partial refund claim was wrongly rejected to the tune of Rs.2,81,87,493/-. This claim needs to be verified from the records by the Adjudicating Authority. Though, it is held that during the relevant period, the appellants are not entitled to refund of CENVAT credit on services utilized for ITSS Services, they would be eligible for the refund of CENVAT credit on services utilized for other services, if otherwise, applicable. For this reason, it is found that the matter requires to go back to the Original Authority.
Whether the appellants are eligible to avail CENVAT credit when the supplier of services pays service tax on a mistaken notion of law? - HELD THAT:- As there is no dispute regarding the fact of duty being paid on the generator, credit cannot be disallowed at the service receiver”s end. Learned Authorized Representative for the Department submits that all the cases cited by the appellant are in the realm of Central Excise and therefore, not applicable to the issue of service tax. This proposition cannot be accepted. The basic principle of CENVAT credit being same under Central Excise & Service Tax regime, any differentiation in this regard would be artificial.
Whether the credit can be denied for the difference in the ST-3 Returns and CENVAT credit Register? - HELD THAT:- Appellant submitted that learned Commissioner has not given any findings on the same - In the case of M/s Temenos India Pvt. Ltd. [2020 (2) TMI 354 - CESTAT CHENNAI], the Tribunal held Further I find that the Commissioner (Appeals) in the impugned order has observed that the appellants have not submitted any 11 documents to prove their contention that they have rightly availed the cenvat credit. It appears that both the authorities have not examined all the documents which have been filed by the appellant in support of their refund claim. In view of this, I set aside the impugned order and remand the matter back to the original authority to examine the refund claim on the basis of other documents filed by the appellant.
Refund cannot be rejected for the reason that there is a discrepancy between the CENVAT record and ST-3 Returns. However, the submissions of the learned Authorized Representative, agreed upon, that the same can be allowed only if records maintained by the appellants demonstrate that the input services were used/ utilized for the export of services - the issue requires to travel back to the Original Authority for a re-consideration in view of our findings as above.
The appeal is allowed by way of remand to the Original Authority.
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