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2025 (4) TMI 1324
Exemption /effective rate for goods falling under Chapter Heading Nos.84 to 98 of of the Central Excise Tariff Act, 1985 under N/N. 6/2006-CE dated 01.03.2006 - Clearance of goods without payment of duty to M/s.Nagarjuna Thermal Power Project, Udipi, Karnataka for setting up of a Mega Power Project - Condonation of delay of 309 days in filing the appeal which has not been satisfactorily explained - It was held by CESTAT that 'Thus, the denial of exemption is without any legal or factual basis. The appellant is eligible for exemption under Notification No.6/2006-CE dated 01.03.2006.'
HELD THAT:- There are no good reason to interfere with the impugned order dated 01-03-2024 passed by the Customs Excise and Service Tax Appellate Tribunal, South Zonal Bench, Chennai.
The appeal is, therefore, dismissed on the ground of delay as well as on merits.
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2025 (4) TMI 1323
Condonation of gross delay of 246 days in filing the petition which has not been satisfactorily explained - release of fixed deposits seized from the petitioner and the company - it was held by High Court that such goods and assets be released in favour of the petitioner forthwith along with statutory interest - HELD THAT:- There is a gross delay of 246 days in filing the petition which has not been satisfactorily explained.
There are no reason to interfere with the impugned order passed by the High Court - SLP dismissed.
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2025 (4) TMI 1322
Prayer for a declaration to the effect Rule 8(4) of the Central Excise Rules, 2002 and 2001 respectively are inconsistent with Rules 3 and 4 of Cenvat Credit Rules, 2001 - HELD THAT:- Since there is no dispute on the position that the above reasoning would apply on all fours to the challenge in the present case as well, Rules 8(4) of 2001 and 2002 Central Excise Rules also, as a consequence, will be liable to be set aside.
A portion of the demand thereunder would stand covered by the decision that are taken in the Writs of Declaration that have been allowed. To this extent, the demand under order-in-original dated 16.05.2005 and recovery notice dated 24.06.2004 are set aside.
Since the Department is agreeable to a hearing of the above afresh, the petitioner is directed to appear before 1st respondent, who now carries the designation The Commissioner of Central Excise, Office of the Commissioner of CGST and Customs, Central Excise and Service Tax, No.1, Foulk's Compound, Anai Road, Salem – 636 001 on 17.04.2025 at 11 a.m. without expecting any further notice in this regard.
Petition disposed off.
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2025 (4) TMI 1321
Refund of Education Cess, Secondary Higher Education Cess and Krishi Kalyan Cess - transitional provisions of the CGST Act, 2017 - applicability of amendment to Section 140(1) of the CGST Act, 2017, which excludes cesses from the definition of "eligible duties and taxes" for transitional credit - HELD THAT:- Definition of “eligible duties and taxes” as per the explanation 3 under Section 140 of the CGST Act was amended with retrospective effect from 01.07.2017 whereby it is specified that Cesses are excluded from the definition of eligible duties and taxes. Thus, the credit is ab initio not available for utilization for GST. In view of the above, Cesses are not be transmitted through Tran -1 as per the transitional provisions specified under CGST Act. As the amount of Cenvat Credit balance of Education Cess & Secondary Higher Education Cess was included in the carried forward amount by the appellant as on the appointed day i.e 01.07.2017 in terms of Section 142(3) of CGST Act, 2017 refund of the same is not admissible to the appellant.
The Cesses are excluded by adding explanation 3 in the Section of the 140 of The Central Goods and Services Tax Act, 2017 from definition “eligible duties and taxes”. The credit is not available as refund. Hon’ble Supreme Court, different Hon’ble High Courts and CESTAT Benches including this Bench held that Education Cess and Secondary Higher Education cess is not refundable as discussed supra. Therefore, there are no legal or factual infirmity in the Order-in-Appeal.
Conclusion - Refund of Education Cess, Secondary Higher Education Cess, and Krishi Kalyan Cess credits carried forward under the pre-GST regime is not admissible under the CGST Act, 2017 transitional provisions or the existing law.
There is no error in the order of the Commissioner (Appeals). Therefore, appeal is liable to be dismissed.
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2025 (4) TMI 1320
Refund of Education Cess, Secondary Higher Education Cess and Krishi Kalyan Cess - transitional provisions of the CGST Act, 2017 - applicability of amendment to Section 140(1) of the CGST Act, 2017, which excludes cesses from the definition of "eligible duties and taxes" for transitional credit - HELD THAT:- Definition of “eligible duties and taxes” as per the explanation 3 under Section 140 of the CGST Act was amended with retrospective effect from 01.07.2017 whereby it is specified that Cesses are excluded from the definition of eligible duties and taxes. Thus, the credit is ab initio not available for utilization for GST. In view of the above, Cesses are not be transmitted through Tran -1 as per the transitional provisions specified under CGST Act. As the amount of Cenvat Credit balance of Education Cess & Secondary Higher Education Cess was included in the carried forward amount by the appellant as on the appointed day i.e 01.07.2017 in terms of Section 142(3) of CGST Act, 2017 refund of the same is not admissible to the appellant.
The Cesses are excluded by adding explanation 3 in the Section of the 140 of The Central Goods and Services Tax Act, 2017 from definition “eligible duties and taxes”. The credit is not available as refund. Hon’ble Supreme Court, different Hon’ble High Courts and CESTAT Benches including this Bench held that Education Cess and Secondary Higher Education cess is not refundable as discussed supra. Therefore, there are no legal or factual infirmity in the Order-in-Appeal.
Conclusion - Refund of Education Cess, Secondary Higher Education Cess, and Krishi Kalyan Cess credits carried forward under the pre-GST regime is not admissible under the CGST Act, 2017 transitional provisions or the existing law.
There is no error in the order of the Commissioner (Appeals). Therefore, appeal is liable to be dismissed.
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2025 (4) TMI 1319
Excisability - classification of Refined Bleached Deodorized Palm Stearin (RBD) and Hydrogenated Palm Stearin (HPS) - to be classified under Subheading Nos. 1511 9090 and 1516 2099 respectively or under Sub-heading Nos. 3823 1112 and 3823 1190 respectively? - Extended period of limitation - HELD THAT:- The CBEC in the Circular No. 81/2002-Customs dated 03.12.2002 has classified Palm Stearin under Chapter heading 15.11, when the same is obtained through fractionation process and classified the same under Chapter heading 38.23, when obtained through the Hydrolytic splitting process. Since, the by-products were obtained by the appellants through the fractionation process, they had claimed the classification of the goods under Chapter 15, which is in consonance with the circular dated 03.12.2002. With regard to the dispute in classification of the subject goods, this Tribunal, in the case of Gokul Enterprises [2008 (11) TMI 135 - CESTAT AHMEDABAD] and Jocil Ltd. [2009 (2) TMI 306 - CESTAT BANGALORE] has taken the view that the product should appropriately be classifiable under Chapter 15. However, the classification dispute in the case of Jocil Ltd. was differed with by the Hon’ble Supreme Court in the case of Jocil Ltd., by holding that the Palm Stearin to be classifiable under Chapter 38. Since, the classification issue was finally resolved by the Hon’ble Supreme Court in the case of Jocil Ltd., the appellants had started paying the Central Excise duty, suo moto, w.e.f. April 2011.
The period in dispute, involved in the present appeal is from November 2009 to March 2011. The Show Cause Notice (SCN) was issued by the department to the appellants on 23.03.2014, seeking for confirmation of the duty demand. The provisions for recovery of non-levied, non-paid, short levied or short paid duties are contained in Section 11A of the Central Excise Act, 1944 - On reading of the above quoted statutory provisions, it transpires that any amount, if lawfully required to be recovered, then the same can be given effect to, by way of issuance of show cause notice within the normal period of one year from the relevant date.
In the case in hand, it is an admitted fact on record that the CBEC in the Circular dated 03.12.2002 had classified the disputed goods under heading 15.11, which was subsequently withdrawn vide Circular No. 31/2011-Customs dated 26.07.2011, pursuant to the judgment of Hon’ble Supreme Court, delivered in the case of Jocil Ltd. - there was proper documentation in support of generation of such by-products in the manufacturing process and removal of the same from the factory premises. Thus, under such circumstances, the extended period of the limitation cannot be invoked for confirmation of the adjudged demands on the appellants inasmuch as there is no element of suppression, wilful misstatement, fraud etc., on the part of the appellants, with an intent to evade payment of Central Excise duty. The department had not specifically brought out any evidence to show that non-payment of Central Excise duty by the appellants was due to the reason of any fraudulent activities, with intent to defraud the Government Revenue.
The issue arising out the present dispute with regard to initiation of the show cause proceedings by invoking the extended period of limitation, was dealt with by the Co-ordinate Bench of the Tribunal in the case of Cargill India Vs. Commissioner of Central Excise. [2024 (9) TMI 1729 - CESTAT MUMBAI], [2024 (9) TMI 1728 - CESTAT AHMEDABAD],wherein the Tribunal has allowed the appeal in favour of the assessee, by holding that the extended period of limitation cannot be invoked for confirmation of the duty demands.
Conclusion - i) Classification disputes, when bona fide and supported by official circulars and Tribunal decisions, negate intent to evade duty. ii) Extended limitation under Section 11A(1) proviso applies only where there is evidence of fraud, collusion, wilful misstatement, or suppression with intent to evade duty. Show cause notices issued beyond one year without such evidence are barred by limitation.
There are no merits in the impugned order, insofar as it has upheld confirmation of the adjudged demands by invoking the extended period of limitation - appeal allowed.
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2025 (4) TMI 1318
Denial of CENVAT Credit - duty paying documents were not available with the Appellant - invocation of extended period of limitation - HELD THAT:- There is nothing coming on record that the Appellant has contravened the provisions of Rule 57AE of the Central Excise Rules, 1944 or Rule 7 of Cenvat Credit Rules, 2002.
Similar issue has been decided by this Bench in the case of Exide Industries Ltd. vs. Commissioner of C.Ex., Haldia, [2008 (1) TMI 190 - CESTAT, KOLKATA]. This Bench has held that 'There is no doubt that Notification No. 13/03, dated 1-3-2003 has substituted the word 'procured' for the word 'purchase' in sub-rule (4) of Rule 7 of CENVAT Credit Rules, 2002 w.e.f. 1-3-2003. But Notification No. 27/2000, dated 31-3-2000 which sought to amend CENVAT Credit Rules, 2000 does not prohibit to read the said substitution for the period earlier to that, under challenge. Definition “inputs” under Rule 57A of Central Excise Rules, 1944 read with Rule 57B and conditions laid down by Rule 57AC nowhere warranted 'purchase' is sine qua non. Therefore Notification No. 13/2003, dated 1-3-2003 guides to appreciate legislative intention. Further, decisions cited by learned Counsel also brings its case in all four. When a levy is not expressly designed by law by a statutory provision, respective Rule which grants credit cannot be presumed to be a charging section by any analogy.'
Conclusion - The appellant is entitled to Cenvat Credit on inputs received from its sister unit.
Appeal allowed.
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2025 (4) TMI 1317
Validity of assessment orders - variation of 317.64 Cubic meters of granite - appeal dismissed on the ground that the said appeals are beyond the period of limitation permissible under the provisions of the A.P. Value Added Tax Act, 2005 - HELD THAT:- The orders of assessment passed by the Commercial Tax Officer state that the petitioners had not produced any material before the Commercial Tax Officer to demonstrate that there was no variation in the quantity of granite quarried and the quantity of granite sold by the petitioners. On that basis, the Assessing Officer had passed the orders of assessment. The petitioners do not choose to file any appeals, against the said orders of assessment, within the period of limitation stipulated under the provisions of the VAT Act. The appeals were filed, with an inordinate delay, and beyond the period of time, which could be condoned by the appellate authority.
The maximum period within which the appeals could have been filed and the further period, which can be condoned by the Appellate Authority, had expired even before the Covid outbreak in March 2020. As such, the order of the Appellate Authority also cannot be faulted.
Conclusion - The writ petitions are clearly barred on account of laches. Apart from that, no cogent reasons are set out for challenging the orders of assessment or the orders of appeal.
Petition disposed off.
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2025 (4) TMI 1316
Interest on delayed refunds - entitlement for enhanced rate of interest - relevant date for calculation of interest - HELD THAT:- As per the provisions of the JVAT Act, 2005, the amount of interest starts accruing automatically after 90 days from the date of submission of application of refund, which was submitted by the petitioner on 16.09.2020 and 90 days therefrom expired on 15.12.2020, hence interest will start accruing w.e.f. 16.12.2020.
In the instant case the interest is calculated as per Rule-19 (2) (a) of the Jharkhand Value Added Tax Rules, 2006. However, taking a clue from the order of Alok Shankar Pandey [2007 (2) TMI 329 - SUPREME COURT] that had the Revenue paid the interest to the Petitioner at the right time, the Petitioner could have invested that amount. Thus, the Petitioner is certainly entitled for enhanced rate of interest. Accordingly, the Petitioner is entitled for the interest @ 9% p.a. which comes to Rs. 72,14,351/, for the period from 16.12.2020 to 20.03.2023 i.e. for 826 days delay on the refund of the amount of Rs. 3,54,21,551.00.
The ground of the respondents with regard to payment of less interest in the background of Suo Moto Writ Petition (C) No. 3 of 2020) [2022 (1) TMI 385 - SC ORDER] that the period from 15.03.2020 to 28.02.2022 excluded while calculating the interest amount, is untenable and without any legs to stand in the eye of law. The Petitioner is entitled for the interest @ 9% p.a. which comes to Rs. 72,14,351/, for the period from 16.12.2020 to 20.03.2023 i.e. for 826 days delay on the refund of the amount of Rs. 3,54,21,551.00.
The Respondent Department is directed to pay the differential amount of interest @ 9% p.a. to the petitioner on account of interest accrued on the principal amount of Rs. 3,54,21,551/- after deducting Rs. 20,43,775/- which was refunded belatedly to the petitioner on 21.03.2023 i.e., after delay of 826 days from the date of refund application filed by the Petitioner. It is made clear that the Respondent department shall make payment of such interest @ 9% after proper calculation within a period of 10 weeks from the date of receipt/production of a copy of this order.
Conclusion - i) Application for refund was submitted by the petitioner on 16.09.2020 and 90 days therefrom expired on 15.12.2020, hence interest will start accruing w.e.f. 16.12.2020. ii) The Petitioner is certainly entitled for enhanced rate of interest.
The instant writ application stands allowed.
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2025 (4) TMI 1315
Dismissal of contempt petition filed by the Appellants - failure to discharge his obligation under the MoU inasmuch as the Respondent has started operating another entity from the premises of the company, is siphoning off plant and machinery which was owned by the company and is defaulting in paying instalments of the term loan - HELD THAT:- The learned Single Judge of the High Court while passing the impugned judgment and final order dated 3rd July 2024 has reviewed the entire order of the learned Single Judge dated 5th December 2023. After the order was passed on 5th December 2023, another learned Single Judge could have only considered whether the Respondent had purged the contempt and if not purged the contempt, as to whether he should be punished or not under the Contempt of Courts Act, 1971. It was not permissible for the learned Single Judge to have revisited the issue as to whether the Respondent has in fact committed contempt or not.
If the Respondent was of the view that the order passed by the learned Single Judge dated 5th December 2023 holding him to be guilty of contempt was not correct in law, the only option available to him was to file an appeal under the provisions of Section 19 of the Contempt of Courts Act, 1971. Having accepted the order dated 5th December 2023, the Respondent could not have contended, or for that matter, the learned Single Judge could not have held that the Respondent has not committed contempt of the Court.
It is a different matter as to whether the Court while considering the provisions of Sections 12 and 13 of the Contempt of Courts Act, 1971 could have arrived at a finding as to whether the Respondent was liable to be punished or not or whether in the facts of the case he should be discharged or the punishment awarded was liable to be remitted on apology made to the satisfaction of the Court or not. The order of the learned Single Judge of the High Court by holding that the Respondent had not committed contempt amounts to sitting in an appeal over the order passed by the coordinate Bench dated 5th December 2023.
It is also contrary to the well settled principles of judicial propriety. When one Judge of the same Court has taken a particular view holding the Respondent to be guilty of contempt, another Judge could not have come to a finding that the Respondent was not guilty of contempt.
Conclusion - i) A coordinate Bench of the same Court cannot overturn or revisit the findings of another coordinate Bench on the question of contempt guilt except through proper appellate procedure. ii) After a finding of contempt and grant of time to purge, subsequent proceedings before another Judge should be limited to whether contempt is purged or punishment is warranted.
The matter is remitted back to the learned Single Judge of the High Court for considering the issue from the stage of the passing of the order dated 5th December 2023 - appeal allowed by way of remand.
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2025 (4) TMI 1314
Dishonour of Cheque - discharge of burden by accused u/s 118 (a) and 139 of the N.I. Act - rebuttal of presumption - whether the High Court was justified in overturning the order of acquittal passed by the Trial Court? - HELD THAT:- Section 118 (a) assumes that every negotiable instrument is made or drawn for consideration, while Section 139 creates a presumption that the holder of a cheque has received the cheque in discharge of a debt or liability. Presumptions under both are rebuttable, meaning they can be rebutted by the accused by raising a probable defence. This Court through various pronouncements, has consistently clarified the nature and extent of these presumptions and the standard of proof required by the accused to rebut them.
A three-Judge Bench of this Court in Rangappa [2010 (5) TMI 391 - SUPREME COURT] had the occasion to consider Section 139 elaborately. The Court reiterated that where the signature on the cheque is acknowledged, a presumption has to be raised that the cheque pertained to a legally enforceable debt or liability, however, this presumption is of a rebuttal nature and the onus is then on the accused to raise a probable defence.
The cheques issued were against an enforceable debt and held by the complainant as such, even though there was no paperwork to that effect. The onus, as such, was shifted upon the other party, i.e., the accused, to raise a probable defence against such presumption.
It has also come on record that the cheque, subject matter of controversy, was given to the complainant in the presence of common well-wishers. However, none of the above statements stands scrutiny. The alleged well-wishers who could have proved the discussion and context in which the cheque was given, remained unexamined. As stated by the complainant himself, there is no official record, such as income tax documents which would show that such an amount was extended by way of a loan to the accused, neither have the books of account, which the complainant allegedly maintained, being produced to evidence the seven or eight transactions inter se the parties totalling the claimed amount.
Conclusion - It cannot be said that the complainant was able to discharge the burden once it had shifted back upon him, with the accused having discharged the burden of Sections 118 and 139 of the N.I. Act.
The Trial Court was correct in recording a finding of acquittal in favour of the accused and reversal thereof by the High Court in terms of the impugned judgment, with particulars as in Para 1, was unjustified - Appeal allowed.
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2025 (4) TMI 1313
Rejection of application filed under Order VII Rule 11(a) and (d) of the Code of Civil Procedure - plaint filed based on an agreement to sell discloses a cause of action under Order VII Rule 11(a) of the Code of Civil Procedure, 1908 (CPC) or not - interest in the suit schedule property as per Section 54 of the Transfer of Property Act, 1882 - HELD THAT:- Order VII Rule 11 CPC serves as a crucial filter in civil litigation, enabling courts to terminate proceedings at the threshold where the plaintiff's case, even if accepted in its entirety, fails to disclose any cause of action or is barred by law, either express or by implication. The scope of Order VII Rule 11 CPC and the authority of the courts is well settled in law. There is a bounden duty on the Court to discern and identify fictitious suit, which on the face of it would be barred, but for the clever pleadings disclosing a cause of action, that is surreal. Generally, sub-clauses (a) and (d) are stand alone grounds, that can be raised by the defendant in a suit. However, it cannot be ruled out that under certain circumstances, clauses (a) and (d) can be mutually inclusive. For instances, when clever drafting veils the implied bar to disclose the cause of action; it then becomes the duty of the Court to lift the veil and expose the bar to reject the suit at the threshold.
The power to reject a plaint under this provision is not merely procedural but substantive, aimed at preventing abuse of the judicial process and ensuring that court time is not wasted on fictitious claims failing to disclose any cause of action to sustain the suit or barred by law. Therefore, the appeal requires careful consideration of the scope of rejection of the plaint under Order VII Rule 11 CPC, particularly, in the context of the suit filed based on an agreement to sell against third parties in possession.
Undoubtedly, a sale deed, which amounts to conveyance, has to be a registered document, as mandated under Section 17 of the Registration Act, 1908. On the other hand, an agreement for sale, which also requires to be registered, does not amount to a conveyance as it is merely a contractual document, by which one party, namely the vendor, agrees or assures or promises to convey the property described in the schedule of such agreement to the other party, namely the purchaser, upon the latter performing his part of the obligation under the agreement fully and in time. Section 54 of the Transfer of Property Act, 1882 explicitly lays down that a contract for sale will not confer any right or interest - The protection under Section 53-A is not available against a third party who may have an adversarial claim against the vendor. Therefore, unless and until the sale deed is executed, the purchaser is not vested with any right, title or interest in the property except to the limited extent of seeking specific performance from his vendor. An agreement for sale does not confer any right to the purchaser to file a suit against a third party who is either the owner or in possession, or who claims to be the owner and to be in possession. In such cases, the vendor will have to approach the court and not the proposed transferee.
In the instant case, admittedly, no sale was originally effected and only part consideration was made, which was not even to the appellant, but rather to a third party. Upon discovering that the property did not belong to the third party, the respondents instituted a suit. It must be noted that the appellant has been in possession of the suit schedule property for several decades - The public interest implications of this case are significant consideration. Such institutions must be protected from speculative litigation that can drain their resources and impede their charitable work. Moreover, allowing suits like the present one to proceed to trial, would not only waste judicial time and resources, but also encourage similar speculative and extortionate litigations. Hence, this is a fit case for the imposition of costs on the respondents under Section 35A of the Civil Procedure Code, 1908.
Conclusion - The plaint ought to have been rejected under Order VII Rule 11(a) and (d) CPC. Hence, the orders passed by the High Court as well as the trial Court rejecting the application filed by the appellant, cannot be sustained in law and deserve to be set aside.
The impugned judgment of the High Court dated 02.06.2022 and the order of the trial Court dated 11.06.2021 are set aside - the application filed under Order VII Rule 11(a) and (d) CPC is allowed - appeal allowed.
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2025 (4) TMI 1312
Dishonour of Cheque - maintainability of prosecution of the appellant for offences u/s 420 IPC, without arraigning the company as an accused, given the business dealings were between companies - applicability of principles of res-judictata - vicarious liability. non-application of mind.
Maintainability of prosecution of the appellant for offences u/s 420 IPC, without arraigning the company as an accused - HELD THAT:- It is to be noted that in 138 NI Act proceedings against Tyagi, he raised a specific defence that there is no outstanding debt qua 07 cheques as the amount involved therein has already been paid by separate demand drafts. Learned Magistrate in its order dated 25.10.2002 rejected the said defence by recording a finding that no request was made by Tyagi to the complainant company to return the bounded cheques to the accused company when the demand drafts were allegedly sent by the accused persons to the complainant company - It is thus apparent that the finding recorded by the jurisdictional criminal court in 138 NI Act proceedings between the parties would be binding to both the parties in any subsequent proceedings involving the same issue.
Applicability of principles of res-judictata - HELD THAT:- In Pritam Singh [1955 (11) TMI 35 - SUPREME COURT], a three Judge Bench of this Court speaking through Natwarlal Harilal Bhagwati, J. placing reliance on Sambasivam vs. Public Prosecutor, Federal of Malaya, decided by a Bench of Five Judges of the Judicial Committee, opined that maxim res judicata is no less appliable to criminal than to civil proceedings. In the said matter, accused Pritam Singh was earlier tried for an offence under the Arms Act basing recovery of a weapon from him. In the said case Pritam Singh was acquitted. In a subsequent trial, the same recovery was again sought to be used by the prosecution as one of the circumstances in an offence of murder.
It is absolutely clear that Tyagi cannot maintain a prosecution on the basis of allegations which were precisely his defence in the earlier proceedings wherein he was an accused. Thus, the present criminal proceedings deserve to be quashed on this ground alone.
In the matter of Delhi Race Club (1940) Ltd. & Ors. vs. State of Uttar Pradesh & Anr. [2024 (8) TMI 1200 - SUPREME COURT], this Court has held that a person cannot be vicariously prosecuted, especially for offences under the IPC, merely on account of the fact that he holds a managerial position in a company without there being specific allegations regarding his involvement in the offence.
Conclusion - i) The prosecution is barred by the principle of res judicata as the issues were conclusively decided in earlier NI Act proceedings. ii) The prosecution without arraigning the company is impermissible and violates settled legal principles governing vicarious liability. iii) The summoning order is set aside for non-application of mind.
The present is a fit case for allowing the appeal to quash the impugned criminal proceedings instituted against the appellant for offences under Section 420 of the IPC - appeal allowed.
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2025 (4) TMI 1311
Breach of reciprocal contractual obligations - Forfeiture of the Appellant’s payments by Respondent No. 1, namely the Housing and Urban Development Corporation Limited (HUDCO) - entitlement of interest on refund of the forfeited amount.
Whether Respondent No. 1/HUDCO was in breach of its reciprocal contractual obligations qua the Appellant? - HELD THAT:- Respondent No. 1, even after the receipt of the first instalment, did not take any tangible steps to secure the necessary statutory approvals. It is obvious that the said failure led to breach of Clause 5(viii) and (ix) also, as admittedly, no ‘agreement to sublease’ was executed in favour of the Appellant, owing to the nonexecution of a perpetual lease by Respondent No. 2 in favour of Respondent No. 1. Nonetheless, it is proceeded to examine the contention of the Appellant that Respondent No. 1 also concealed the fact that it did not have the title and authority to execute the ‘agreement to sub-lease’ in favour of the Appellant.
Respondent No. 1 being incapable of fulfilling its reciprocal promises, was not entitled to demand payment for the second instalment until the perpetual lease deed was executed in its favour. Respondent No. 1’s failure to execute the sub-lease in favour of the Appellant, owing to the lack of its authority and title, also amounts to a breach of their contractual obligations - there is some merit in the Appellant’s grievance of differential treatment when compared to the Ansals.
There are no doubt that Respondent No. 1 was in breach of several obligations as contemplated in the Allotment Letter, viz. failure to execute documents for securing approval under the ULCR Act and the IT Act; failure to execute the sub lease agreement in favour of the Appellant and; failure to secure the approval of the revised layout plan for the construction of the hotel.
Whether the Appellant is entitled to a refund of the forfeited amount under Clause 5(vi) of the Allotment Letter? - HELD THAT:- Clause 5 (vi) of the Allotment Letter, which deals with the monies paid by the Appellant, provides that Respondent No. 1 will execute all required documents to obtain approval from the Competent Authority under the ULCR Act and also from the Appropriate Authority as envisaged in Chapter XX C of the IT Act, failing which, Respondent No. 1 will refund the amount paid without any interest - it is imperative to maintain the sanctity of the terms of the agreement between the parties. It is a settled position of law that a commercial document ought not to be interpreted in a manner that arrives at a complete variance with what may originally have been the intention of the parties. As a result, Respondent No. 1 is liable to refund the amount of Rs. 28,11,31,939 (First instalment of Rs. 27.04 Crores along with interest for three months amounting to Rs. 1,04,81,939/- and Rs. 2.5 Lakhs towards maintenance corpus) deposited by the Appellant pursuant to the Allotment Letter.
Whether the Appellant is entitled to interest on refund of the forfeited amount? - HELD THAT:- The material on record sufficiently indicates that the Appellant did not approach the Court with clean hands and instead attempted to hoodwink the judicial process by creating a facade to subterfuge their inability to meet their contractual obligations - It needs no emphasis that whosoever comes to the court claiming equity, must come with clean hands. The expression ‘clean hands’ connotes that the suitor or the defendant have not concealed material facts from the court and there is no attempt by them to secure illegitimate gains. Any contrary conduct must warrant turning down relief to such a party, owing to it not acting in good faith and beguiling the court with a view to secure undue gain. A court of law cannot be the abettor of inequity by siding with the party approaching it with unclean hands. This also brings to mind the oft-quoted legal maxim—he who seeks equity must do equity.
The instant case is found to be fit to justify a deviation from the established standards. In the facts and circumstances, though we have held Respondent No. 1 to be in breach of several contractual obligations, the conduct of the Appellant is rife with instances where it has also sought to undermine the authority and integrity of the judicial process, by treating the Court with disregard, and attempting to exploit procedural mechanisms for personal gain. The Appellant is not entitled to any discretionary relief of interest under Section 34 of CPC.
Conclusion - i) Respondent No. 1/HUDCO, was in breach of its reciprocal contractual obligations, thereby disentitling them from forfeiting the monies already paid by the Appellant towards the first instalment as enshrined in Clause 5 (iii) of the Allotment Letter dated 31.10.1994. ii) Given that the Appellant has blatantly engaged in forum shopping, and considering that their overall conduct does not in any manner reflect an approach aligning with the clean hands doctrine, they are not entitled to grant of any discretionary relief of interest in their favour.
The Impugned Judgement dated 03.06.2016 passed by the High Court is set aside - appeal disposed off.
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2025 (4) TMI 1310
Building Tax - Seeking for a direction to quash Ext.P3 - seeking also for a direction to reconsider Ext.P2 and assess building tax on petitioner's building as per the plinth area in the plan approved by the local authority - HELD THAT:- The Kerala Building Tax Act, 1975 provides for assessment of building tax. Once an order of assessment is passed, the assessing authority becomes practically functus officio for the purpose of building tax. The remedy of a person aggrieved by an order of assessment is to prefer statutory appeal and revision as provided under the Act. In the absence of any statutory remedy invoked by the petitioner, the assessment order became final. Therefore recourse to Article 226 of the Constitution of India is not proper.
In the instant case, petitioner had even acquiesced into the order by paying the first instalment and thereafter he has turned around and now requests for acceptance of a portion of the amount in satisfaction of the entire tax assessed. Such a procedure is unheard in law. Once tax has been assessed, the entire amount has to be paid, unless there are amnesty schemes.
There are no merit in this writ petition and it is dismissed without prejudice to the remedies, if any available under the Act.
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2025 (4) TMI 1309
Smuggling of Ganja of commercial quantity - contraband item - offences punishable under Section 8(c), 20(b)(ii)(c), 22 and 29 of the Narcotic Drugs and Psychotropic Substances Act, 1985 - HELD THAT:- There is no dispute that commercial quantity in relation to NDPS Act for ‘ganja’ means any quantity greater than 20 kg. The Section 2(iii) (b) and (c) defines ‘Ganja’ as the flowering or fruiting tops of the cannabis plant (excluding the seeds and leaves when not accompanied by the tops), by whatever, name they may be known or designated, and any mixture, with or without any neutral material, of any of the above forms of cannabis or any drink prepared therefrom.
There is nothing on record to prima facie show that before carrying weight of the seized plant of ganja, the investigating officer had segregated the seeds or the other parts of the plant in order to ascertain the exact quantity of ganja. In fact, none of the paper mentions that the said contraband articles which were seized includes the flowering or fruiting tops of cannabis plant. This fact becomes further clear from the panchanama also - on perusal of the material on record shows that what was seized was plant i.e. leaves, seeds, stems and stalks and without separating the same, the ganja was weighed. As the seized material was not weighed and after separating the leaves and the other parts and moreover it is not along with the flowering or fruiting tops. Therefore, it is difficult to ascertain whether quantity can be said to be commercial.
After perusal of the investigating papers, prima facie, the material complied with the chargesheet, it is difficult to accept that the alleged prohibited substance is within the definition of ganja under the NDPS Act. Since the only flowering or fruiting tops of cannabis plant are classified as ganja, in absence of the said substance being seized from the applicant, prima facie involvement of the applicant is difficult to hold. Moreover, there is inordinate delay in conducting the trial and, therefore, the right of the accused of speedy trial is affected. Recently, the Hon’ble Apex Court in the case of Ankur Chaudhary Vs. State of Madhya Pradesh [2024 (5) TMI 1463 - SC ORDER], by referring the earlier decisions held that inordinate delay in trial is affecting the right of the accused of a speedy trial, which is violation of article 21 of the Constitution of India.
Conclusion - There is nothing on record to prima facie show that before carrying weight of the seized plant of ganja, the investigating officer had segregated the seeds or the other parts of the plant in order to ascertain the exact quantity of ganja. In absence of the said substance [flowering or fruiting tops] being seized from the applicant, prima facie involvement of the applicant is difficult to hold.
The applicant- Mohammad Jakir Nawab Ali, be released on bail subject to fulfilment of conditions imposed - bail application allowed.
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2025 (4) TMI 1308
Service of SCN - whether service of notice/order by making available in the Common Portal is valid? - HELD THAT:- Submission of petitioner that Section 146 of the GST Act does not enable notifying common portal for serving notice/ orders/ communications, thus service of notice/ order by making it available in the common portal would not constitute valid mode of service is untenable. Section 146 of GST Act, provides that common portal may be notified for carrying out various functions and purpose of the Act. While the Government may in excersise of its power under Section 146 of GST Act, identify the portal and notify the purpose for which it is to be employed, however, the purpose/ functions for which the common portal may be employed in terms of notification issued under Section 146 of the Act is not exhaustive. Sub-clause (d) to sub-section(1) to Section 169 of the GST Act, while providing that the decision, order, summon, notice shall be served by making it available in the common portal does not contemplate a notification under Section 146. Section 169 of the Act is a standalone independent provision, its operation is not dependent on any notification under Section 146 of the Act.
Any doubts as to whether notice or order may be served in the above GST portals as well, is unfounded and hypothetical.
Conclusion - The construction that service by making it available on the Common Portal is not a valid mode of service is contrary to the express provisions under GST Act.
The impugned orders are set aside - The petitioner shall deposit 25% of the disputed taxes as admitted by the learned counsel for the petitioner and the respondent, within a period of four weeks from the date of receipt of a copy of this order - petition disposed off.
As per correction order dated 25-04-2025, the condition of stay order is modified. Now the petitioner is required to deposit 10% of the disputed taxes, which was earlier 25% of the disputed tax, and the balance shall be refunded to petitioner.
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2025 (4) TMI 1307
Levy of penalty u/s 129(1)(a) of the GST Actfailure to generate Part-B of the E-Way Bill - non-application of mind - violation of principles of natural justice - HELD THAT:- It appears that it is not in dispute that the petitioner has issued the Delivery Challan for job work dated 07.08.2018 and E-Way Bill was also generated but only Part-B of the E-Way Bill was not generated by the petitioner which stipulates for mentioning of the vehicle number in which the goods were to be transported.
From bare perusal of the reasons assigned by the Appellate-Authority, it is opined that the same are totally without application of mind in the facts of the case and the petitioner, who is not a ‘supplier’ as defined under Section 2(105) of the GST Act and who has only transported the goods other than by way of supply for job work, could not have been saddled with the penalty of Rs.7,36,490/- for not generating Part-B of the E-Way Bill - the respondent-Authorities have passed the impugned order without considering the facts of the case that the contravention of the Rule 138 of the GST Rules is lineal and technical for not generating Part-B of the E-Way Bill, more particularly, when the goods (in question) were accompanied by a valid Delivery Challan for job work which is not in dispute and only non-generation of Part-B of the E-Way Bill by the petitioner stating the vehicle number, cannot be considered as a gross negligence on part of the petitioner and the penalty as prescribed in clause (a) of Section 129(1) of the GST Act could not have been levied but the same as per the Circular No.64 of 2018 dated 14th September, 2018 issued by the CBIC.
Considering the above circular issued by the CBIC, it is true that the case of the petitioner does not fall in any of the situations specified in clauses (a) to (f) of the paragraph No.5 of the said Circular. However, in the facts of the case, as the petitioner has generated Part-A of the E-Way Bill which also contains the GST Number and name of the transporter accompanied by the Delivery Challan for job work stating the vehicle number which is not disputed by the respondent-Authorities, it is opined that the benefit of the Circular No.64/38/2018-GST is required to be given to the petitioner too.
Conclusion - The petitioner, who is not a 'supplier' as defined under Section 2(105) of the GST Act and who has only transported the goods other than by way of supply for job work, could not have been saddled with the penalty of Rs.7,36,490/- for not generating Part-B of the E-Way Bill.
The impugned order passed in Form GST MOV-9 is hereby modified by reducing the penalty to Rs.25,000/- only and the respondents are directed to refund the balance amount paid by the petitioner either in Electronic Cash Ledger or by Electronic Credit Ledger in accordance with the provisions of the Act and Rules - the petition is partly allowed.
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2025 (4) TMI 1306
Seeking grant of regular bail - availment of ineligible Input Tax Credit by utilizing the fake firms - HELD THAT:- This Court finds that the entire case of the prosecution is based upon the documentary material and the investigation in the alleged crime is also complete. Further, during the course of hearing, it is not disputed by Mr. Parv Agarwal, learned counsel that the complaint against the applicants, as well as the other complaints dated 14th November, 2024 and 13th December, 2024 filed against the Shivam Goyal and Vikrant Singhal, etc. respectively, are part of same transactions and the said co-accused have already been extended the concession of regular by this Court.
Admittedly, the alleged offences are triable by Magistrate and provide for a maximum punishment of five years imprisonment, and trial is likely to consume considerable time to conclude, therefore, this Court has no hesitation in holding that the further detention of the applicants behind the bars would not serve any useful purpose, who are confined in judicial custody. Further, the prosecution witnesses are official witnesses and presently there does not appear to be any possibility of their being won over, therefore, considering the nature of the trial as well as period of more than six months undergone by the applicants as an undertrial, this Court deems it appropriate to extend the concession of regular bail to the applicants on the ground of parity.
Conclusion - Admittedly, the alleged offences are triable by Magistrate and provide for a maximum punishment of five years imprisonment, and trial is likely to consume considerable time to conclude, therefore, this Court has no hesitation in holding that the further detention of the applicants behind the bars would not serve any useful purpose.
The bail applications are allowed.
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2025 (4) TMI 1305
Jurisdiction to adjudicate issues related to Integrated Goods and Services Tax (IGST) refunds and demands - HELD THAT:- The plea sought to be raised by the petitioner based on the CBITC Circular dated 18.11.2019 as well as the fact that the provisions of Rule 96B of the Rules were introduced by a Notification dated 23.03.2020 and the same being not retrospective, had no application to the case of the petitioner, despite being legal pleas, having not been examined/could not have been examined by the Assessing Authority, which aspect does require a determination by this Court at this stage, when the Authority under the Act has not applied its mind to the said issues.
In view of the peculiar circumstances of the case wherein the plea raised essentially is legal and its implication needs to be examined by the Authority in the circumstances of the case, it is deemed appropriate and, therefore, the order dated 30.08.2024 passed by the Deputy Commissioner, State Tax, Jurisdiction Bijnor, Sector 1, Bijnor, Moradabad set aside and the matter remanded back to the said Authority. The petitioner shall file its response to the show cause notice dated 17.05.2024 by 02.05.2025 and on filing of the said reply, respondent no.2 shall afford opportunity of personal hearing to the petitioner and thereafter pass fresh order in accordance with law.
Conclusion - i) The plea challenging jurisdiction of State Tax Authority is rejected. ii) The demand order under Rule 96B is set aside on the ground of non-retrospectivity and lack of consideration by the Authority.
Petition disposed off by way of remand.
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