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Showing 121 to 140 of 1484 Records
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2025 (3) TMI 1364
TDS u/s 194C - TDS on sub-contract payments made towards transport charges - Disallowance u/s 40(a)(ia) - HELD THAT:- It is admitted fact that the assessee has filed the return of income within the prescribed due date along with the audit report on 01.11.2017.
In the assessment proceedings the assessee has filed the details of expenditure which are liable for TDS and corresponding TDS made by the assessee before the AO. Assessee also furnished payments made to Transport sub-contractors and stated that the TDS has not been deducted for these 12 sub-contractors, since these sub-contractors owned less than 10 ‘goods carriages’ and have furnished the declaration to that effect along with their PAN.
AO was not convinced since the assessee has failed to produce the declaration as required to file mandatorily u/s.194C(6) of the Act and disallowed 30% of the same u/s.40(a)(ia) - CIT(A) was pleased to confirm the same even though the assessee has submitted the entire details of TDS compliances made u/s.194C in respect of payments made to sub contract transporters before the CIT(A), NFAC, Delhi.
We note that the assessee has filed quarterly E-TDS returns for all the 4 quarters within the prescribed due dates and the TDS provisions along with the certain corrected E-TDS returns by correcting certain error in the original E-TDS returns for few quarters.
The assessee has deducted TDS on certain payments wherever applicable and has not made TDS on Transport sub-contractors payments made to 12 sub-contractors as these contractors owned less than 10 ‘goods carriages’ and have furnished the declaration in compliance with the section of 194C(6) of the Act to the assessee.
The assessee in turn has furnished the entire details of the Transport sub-contractors and corresponding payments made to them on quarterly basis, which has been uploaded in the quarterly E-TDS returns filed in Form No.26Q. The assessee had also issued Form No. 16A which have been generated from the website of the Income department (TRACES) and issued to the sub-contractors showing their transactions entered in all the 4 quarters of the impugned assessment year.
Therefore, AO and the Ld.CIT(A) have erred in disallowing the Transport sub-contractor payments u/s.40(a)(ia) of the Act even though the assessee has complied with the provisions of section 194C(6). In the present facts and circumstances of the case the assessee has complied by collecting the declarations prescribed u/s.194C(6) from the Transport sub- contractors for having less than 10 ‘goods carriages’ and thereby the assessee has not deducted TDS - Appeal of the assessee is allowed.
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2025 (3) TMI 1363
Reopening of assessment u/s 147 - notice issued by non-jurisdictional AO Ward-3(4), Ludhiana - notice to an NRI - jurisdiction was assumed by the DCIT, International Taxation on the basis of the notice u/s 148 as issued by ITO Ward-3(l), Chandigarh - HELD THAT:- The assessee was a NRI from 2000 to 2013 and he had earlier been living in Afghanistan, but due to disturbed conditions, he came back to India under adverse circumstances, and also that there was no fresh issue of a notice u/s 148 by the Assessing Officer, International Taxation.
The jurisdiction was assumed by the DCIT, International Taxation on the basis of the notice u/s 148 as issued by ITO Ward-3(l), Chandigarh. As the AO, ITO, Ward 3 (1) did not have the jurisdiction to issue the notice u/s 148, realising his mistake, on his own, he transferred the case to the DCIT, International Taxation, Chandigarh which is evident form the following observations of the AO without their being any intimation or request from the assessee.
Thus, we have no hesitation in holding that the initiation of proceedings u/s 148 by the ITO Ward-3(1), Chandigarh was bad in law. Decided in favour of assessee.
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2025 (3) TMI 1362
Not allowing credit for TDS as claimed in the return of income and as per 26AS - HELD THAT:- We find that AO/CPC in his 143(1) intimation has specifically mentioned that “following are the details of unmatched tax deducted at source” and with this remark the AO/CPC has also provided the names of all the four contractors who have reimbursed the amount to the assessee towards harvesting and transportation charges and deducted TDS thereon.
From perusal of the above remark, it is very much clear that the AO/CPC has specifically mentioned the reason for not allowing the credit of TDS to the assessee and therefore the ground no.3 raised by the assessee in this regard fails and the contention of the assessee that the AO/CPC has not provided any reasons for not allowing TDS claim proves to be wrong.
Assessee has produced Form 26AS downloaded on 18th June, 2020 wherein all the TDS entries are appearing.
We deem it appropriate to set-aside the order passed by Ld. Addl./JCIT(A)-1, Coimbatore and remand the matter back to him with a direction to decide the appeal afresh as per fact and law & after considering the orders passed by the AO for earlier assessment years starting from assessment years 2009-10 to 2014-15 and for assessment year 2016-17 wherein the claim of the assessee was accepted and refunds were also issued after making certain adjustments.
The assessee is also hereby directed to respond to the notices issued by Ld. Addl./JCIT(A)-1, Coimbatore and furnish requisite details, if any, further required by Addl./JCIT(A)-1, Coimbatore and also to produce supporting documents/additional evidence in support of grounds of appeal without taking any adjournment under any pretext, otherwise Addl./JCIT(A)-1, Coimbatore shall be at liberty to pass appropriate order as per law. Appeal filed by the assessee is partly allowed for statistical purposes.
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2025 (3) TMI 1361
Seeking provisional release of containers pending clearance by securing the differential duty claimed by the Department - Section 110A of the Customs Act, 1962 - HELD THAT:- As far as securing the differential duty is concerned, there are no difficulty in the said condition being imposed. In fact, the learned counsel appearing on behalf of the Petitioner fairly conceded that the Petitioner is willing to secure the differential duty by furnishing a bank guarantee. As far as this aspect is concerned, there are no difficulty in the condition imposed by the Department.
Redemption fine - HELD THAT:- The Department is also justified in asking the Petitioner to secure redemption fine because admittedly this would be payable for release of the goods (of course subject to the fact that they were properly seized). The condition to secure the redemption fine is also justified.
Penalty - HELD THAT:- Before adjudication of the show cause notice, there is no justification on the part of the Department to ask the Petitioner to secure the penalty. It is not as if that in every single case penalty has to be imposed. Considering these facts and circumstances, it is directed that the goods of the Petitioner covered under Bill of Entry No. 6517826 dated 6th November 2024 and Bill of Entry No. 7587153 dated 3rd January 2025 shall be provisionally released on the Petitioner securing the differential duty as well as the redemption fine as more particularly set out in the emails dated 16th January 2025 and 28th February 2025 respectively.
Conclusion - The provisional release of goods ordered upon securing the differential duty and redemption fine, without requiring the securing of penalties. The demand for securing differential duty for past cases not upheld.
Petition disposed off.
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2025 (3) TMI 1360
Challenge to detention order under COFEPOSA Act - smuggling of foreign origin gold from Yangoon (Myanmar) to Gaya - it is the main contention of the petitioner that even though he has been released on bail by the High Court in connection with the aforesaid criminal complaint for the same incident, because of the impugned order of detention under the provisions of the COFEPOSA Act, he is continuing in detention for no purpose, which is illegal and arbitrary - HELD THAT:- The object of detention under the detention law is not to punish, but to prevent the commission of certain offences. Further, in the recent decision rendered by the Hon’ble Supreme Court in the case of Ameena Begum [2024 (1) TMI 4 - SUPREME COURT], it has been specifically held by the Hon’ble Supreme Court that a constitutional court, when called upon to test the legality of orders of preventive detention, would be entitled to examine certain aspects referred in paragraph 28.1. to 28.10 of the said decision.
In the case of Saraswathi Seshagiri [1982 (3) TMI 252 - SUPREME COURT], the Hon’ble Supreme Court has observed that the concerned detenue tried to export Indian Currency to the tune of Rupees 2,88,900.00 to a foreign country in a planned and pre-meditated manner by clever concealment of it in several parts of his baggage and, therefore, the Hon’ble Supreme Court observed that the detaining authority was justified in coming to the conclusion that he might repeat his illegal act in future also. His past act in the circumstances might be an index of his future conduct. Thereafter, the Hon’ble Supreme Court observed that the authority may prosecute the offender for an isolated act or acts of an offence for violation of any criminal law, but if it is satisfied that the offender has a tendency to go on violating such laws, then there will be no bar for the State to detain him under a Preventive Detention Act. What is required is that the detaining authority is to satisfy the Court that it had in mind the question whether prosecution of the offender was possible and sufficient in the circumstances of the case. It has been further observed that in some cases of international smuggling where it may not be possible to collect all necessary evidence without unreasonable delay and expenditure to prove the guilt of the offender beyond reasonable doubt, the past conduct or antecedent history of a person can appropriately be taken into account while passing the detention order.
In the case of Rekha [2011 (4) TMI 1217 - SUPREME COURT], the Hon’ble Supreme Court has observed that if the ordinary law of the land (the Penal Code and other penal statutes) can deal with a situation, recourse to a preventive detention law will be illegal.
Another contention raised by the petitioner is that there was a delay in service of the order of detention by contending that the detention order has been passed on 06.03.2024, which was communicated to him on 29.05.2024. However, the aforesaid contention is also misconceived. From the records, it transpires that the order of detention was passed on 06.03.2024, which was duly executed on the petitioner on 11.03.2024. Though the petitioner was made aware of his right to represent, he did not avail the same by making representation to the detaining authority and the Central Government and when the case of the petitioner was referred to the Advisory Board on 10.04.2024, he filed his defence statement there and the Advisory Board, after conducting the proceedings on 29.04.2024 and 13.05.2024, gave its opinion and opined that the detention of the petitioner is justified - it cannot be said that the order of detention dated 06.03.2024 was communicated to the petitioner on 29.05.2024. Hence, the said contention is misconceived.
Conclusion - In the present case, the respondent detaining authority has followed all the constitutional, statutory and procedural requirements as well as safeguards. The subjective satisfaction of the detaining authority does not vitiate, as has been contended by the petitioner. Therefore, when the detaining authority after satisfying itself subjectively after considering all the relevant material, passed the impugned order of detention, the same cannot be interfered with while exercising power under Article 226 of the Constitution of India.
Petition dismissed.
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2025 (3) TMI 1359
Invocation of extended period of limitation - issuance of multiple SCN on same facts - Classification of imported fabrics - to be classified under CTH 55151230 or not - eligibility for BCD exemption under N/N. 026/2000-Cus. dt. 01.03.2000 - HELD THAT:- The Commissioner of Customs had ordered the extension of period of limitation by six months as proposed in the SCN and accordingly, in strict compliance thereto, Department did issue another SCN under Section 28 and 124 of the Customs Act.
There is no dispute that the said notice is issued just before the expiry of six months. The time limit extended by the Commissioner having been honoured, the only course available was to adjudicate at least this second SCN, but however, the issuance of another show cause notice after the extended six months period, by violating the Commissioner’s OIO has been questioned since this SCN is apparently issued by invoking the extended period of limitation. The arguments of the appellant is that the extension provided by the Order-in-Original [supra] was for issuing SCN and nothing else and once the SCN having been issued, the Revenue could not have assumed jurisdiction once again, that too after the expiry of permitted six months by treating directions in the said OIO as an endless permission, which is not permissible under the Statute. This even cannot be accepted since the said notice which came to be adjudicated per impugned Order-in-Original was issued clearly after the artificially permitted extension of time and hence, the very foundation itself is not proper.
Conclusion - i) The invocation of the extended period of limitation for issuing SCNs not justified, as the facts were already known to the authorities, and subsequent notices based on the same facts did not constitute suppression. ii) The procedural lapse regarding cross-examination did not materially affect the decision, as the primary issue was the improper invocation of the extended period.
Appeal allowed on limitation.
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2025 (3) TMI 1358
Levy of penalties u/s 112(a) of the Customs Act, 1962 on appellant - undervaluation of imported goods - denial of cross-examination and the non-supply of crucial documents - violation of principles of natural justice - satatement of co-accused - HELD THAT:- There is not an iota of evidence to establish that the appellant was in effect the kingpin in the racket of undervalued imports of said goods. The fact that the appellant was a financer who enabled the payment of differential duty through the importers /the custom broker cannot ipso facto be held to conclude the appellant as the importer, and who had knowledge about the undervalued imports or intentionally involved in such malpractice of goods and subjected to penal proceedings under Section 112(a).
It is an undisputed fact that the department neither provided cross-examination of the co-accused as sought for by the appellant nor provided the basic import documents to the appellant for furtherance of his defence and while rightly going about redetermination of the transaction values in accordance with law failed to establish nexus of the appellant with the improper imports effected. The admitted role of the appellant being that of a financer of subject imports having voluntarily made good the differential duty of Rs.30 lakh cannot lead to conclude that the appellant had knowledge and intentionally indulged in such imports when there is nothing on record to establish the connection of the appellant to of having done an act rendering the offending goods liable for confiscation - There is nothing on record to bring out any specific knowledge on the part of the appellant herein or having played a role in under-valued imports. Moreover, as stated earlier the appellant has been denied a total recourse to Natural Justice in the present matter, in as much as even the Bill of Entry and the import invoice not supplied to him, and there’s no reason for such a course of action.
Conclusion - The statement tendered by the co-accused lacks evidentiary value unless it is examined and an opportunity of cross examination provided to the accused. Nothing therefore comes out on record to substantiate the penal liabilities imposed on the appellant in the instant matter. As held in a series of cases non-supply of Relied upon/Non-Relied upon documents as also not affording cross-examination are a serious flaw and violation of natural justice.
The impugned order is set aside - appeal allowed.
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2025 (3) TMI 1357
Confiscation of imported goods - levy of redemption fine and penalty - finalization of the provisional assessment not challenged - HELD THAT:- The finalization of the assessment of Bills of Entry was never challenged by the Revenue. Therefore, on that score itself the valuation matter has reached finality.
The impugned OIA, which was passed when the matter was sub judice before the Tribunal, does not survive - Appeal allowed.
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2025 (3) TMI 1356
Validity of revival of struck off company - Interpretation of statute - second proviso of Section 252 of Companies Act, 2013 - Striking off the name of a company from the register of companies - HELD THAT:- The plain reading of second proviso to Section 252, shows that where the Registrar of Companies feels that the name of the company has been struck off from the Register of Companies either inadvertently or on the basis of incorrect information furnished (as has been stated to be the case by the Respondents in the present Petition), the Registrar of Companies may within a period of three years from the date of passing of the order dissolving such company under Section 248 of the 2013 Act, file an application under Section 252 of the 2013 Act seeking restoration of the name of such company before the Tribunal.
The procedure, as set out in second proviso to Section 252 of the 2013 Act, is that the Registrar must, within a period of three years from the date of order of dissolving the company, file an application before the National Company Law Tribunal seeking restoration of such company.
Concededly, the Respondent No. 2 has taken no such steps as are required under the provisions of the 2013 Act, yet the Company was revived. In addition, since the order dissolving the Company was dated 11.01.2016, such steps were required to be taken by the Respondent No. 2 within three years from such date – which has also not been done. Thus, the action of the Respondent No. 2 cannot be sustained.
Conclusion - The Respondent No. 2 is directed to strike off the name of the company from the Register of Companies and to take all necessary steps in accordance with the law.
Petition allowed.
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2025 (3) TMI 1355
Dismissal of Section 7 application filed by the Financial Creditor-Appellant on the grounds of being time-barred - sufficient ground for allowing extension of the period of limitation and the applicability of the suo moto orders of the Hon’ble Supreme Court or not - HELD THAT:- It is well settled that if a corporate debtor acknowledges its debt in writing before the expiration of the three-year period, the limitation period would be extended by another three years. This is in conformity with Section 18 of the Limitation Act, which allows for the revival of the limitation period based on the acknowledgment of debt. The question of acknowledgement of liability made in a Balance sheet as acknowledgement of debt has been considered by the Hon’ble Supreme Court in Tulip Star [2022 (8) TMI 70 - SUPREME COURT] wherein it has been held that balance sheet entry can be regarded as an acknowledgment of liability for the purpose of limitation law.
The argument canvassed by the Appellant that there is acknowledgement of debt in the balance sheet for FY 2019-20 considered, and it is noticed that the said balance sheet of FY 2019-20 was signed on 12.08.2020, Even in this case, para 5.III of the suo moto orders would have been attracted and the last date for filing of Section 7 petition would have continued until expiry of 90 days from 01.03.2022. Since the Section 7 petition was filed on 15.01.2024, it, therefore, stood clearly time-barred. The Adjudicating Authority has correctly held that the exclusion period under suo moto orders does not come to the rescue of the Appellant even in this case.
Whether acknowledgment in Balance sheet for the purpose of limitation has to be counted from the date of signing of the Balance sheet or from the date of its uploading with the RoC on the MCA portal? - HELD THAT:- The conditionalities required for attracting Section 18 of the Limitation Act, 1963 are (i) an admission or acknowledgement of liability; (ii) such acknowledgement must be in respect of a property or right; (iii) that the acknowledgement must be made before the expiry of limitation and (iv) that it should be in writing and signed by the party against whom such property or right is claimed. The Explanation clause thereto, however, provides that an acknowledgment may be sufficient though it may omit to specify the exact nature or the specific character of the said liability. However, the person acknowledging must be conscious of his liability and commitment should be made towards that liability - Any writing to be an acknowledgment of liability must entail an admission of a subsisting jural relationship between the parties and there should be a conscious affirmation of an intention of continuing such relationship in respect of this existing liability.
Guidance also provided by judgement of Hon’ble High Court of Andhra Pradesh in Vijaya Kumar Machinery & Electrical Stores Versus Alaparthi Lakshmikanthamma [1968 (1) TMI 23 - ANDHRA PRADESH HIGH COURT] wherein it has been held that that the date on which the balance-sheet was signed is material to constitute an acknowledgment.
Conclusion - There are no error on the part of the Adjudicating Authority to have relied on the date of signing of the Balance sheet for extension of limitation period - There is no merit in the argument of the Appellant that the Adjudicating Authority had wrongly calculated the extension of limitation from the date of signing of the Balance sheet by the Corporate Debtor i.e. on 12.08.2020 instead of calculating it from the date it was uploaded on the MCA website i.e. on 14.02.2021. There is no mandatory requirement for factorising the date of uploading of the balance sheet on the MCA portal for computing the period of limitation.
There are no merits in the appeal - appeal dismissed.
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2025 (3) TMI 1354
Condonation of delay of 708 days in filling the Appeal - Money Laundering - challenge to provisional attachment order - sufficient cause for delay or not - merger of ING Vysya Bank with Kotak Mahindra Bank - HELD THAT:- There is no doubt that the order, confirming the provisional attachment was passed on 01st June, 2016 and it is the admitted position that the same was received on 03rd June, 2016 by the bank - In the opinion of this Court, the merger of the Transferor Bank (ING Vysya Bank) with Kotak Mahindra Bank in April, 2015, is a justifiable reason and cause that could have resulted in the delay.
Upon the perusal of Section 26 of the PMLA, it would show that after the initial period of 45 days, there is no outer limit prescribed and the question would be whether there is sufficient cause or not - firstly, there is no outer limit and there is also no negative stipulation that delay beyond a particular period would not be condonable.
A Coordinate Bench of this Court, in Directorate of Enforcement v. O P Nahar [2022 (5) TMI 1362 - DELHI HIGH COURT] while adjudicating an appeal from an order of the Appellate Tribunal wherein the appeal under Section 26 of the PMLA was rejected due to delay of 204 days in its filing. The Court condoned the delay and inter alia held that the Appellant therein sufficiently explained the delay for not filing the appeal within the prescribed period.
This Court takes into consideration the fact that the Appellant is a bank and since it was going through the merger process, it cannot be said that the delay is completely inexplicable. Mergers of banks would involve complicated processes, technological integration, customer integration, staff related issues, compliances etc., have to be put in place. This could have delayed the filing of the appeal due to various procedural and administrative reasons.
Conclusion - The merger process provides a sufficient cause for the delay, thereby condoning it and restoring the appeal for adjudication on merits.
The merger process provided a sufficient cause for the delay, thereby condoning it and restoring the appeal for adjudication on merits - The appeal shall now be restored to its original number before the Appellate Tribunal and shall be adjudicated on merits in accordance with law.
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2025 (3) TMI 1353
Money Laundering - proceeds of crime - Provisional Attachment Order - diversion of depositors amount to personal accounts routed through company’s bank accounts for wrongful gain and amassed huge movable and immovable assets by utilizing illegally gained money of depositors - impact of a civil court decree in favor of the appellants regarding the title and possession of the disputed property - HELD THAT:- The property in question was existing in the name of Heera Retail Pvt. Ltd. of Hyderabad on the payment of consideration of Rs.5 Crores and other amount of Rs. 2 Crore paid by M/s Heera Gold Exim Ltd. and Rs.3.48 Crore by M/s Heera Retail Pvt. Ltd. much prior to the decree dated 19.11.2018. The statement given above shows that the property in question was existing in the name of M/s Heera Retail Pvt. Ltd. out of proceeds of crime much prior to the decree and was not challenged in the suit and M/s Heera Retails Pvt. Ltd. was not even made party to the suit.
Apart from the Civil Suit, the appellant even preferred a Writ Petition No. 15019/2019 to challenge the attachment of the property under the Act of 1999. The Writ Petition was disposed of with liberty to the appellant to avail alternate remedy under Section 7(3) of the Act of 1999. The appellant accordingly approached the Metropolitan Sessions Judge to challenge the order of attachment under the Act of 1999. The learned Metropolitan Sessions Judge allowed the application preferred by the appellant. It was based on the Civil Decree ignoring the fact as to whom it would be binding and how the decree was taken by the appellant. The Metropolitan Sessions Judge though took note of the fact that the property was conveyed in favour of M/s Heera Group of companies who was none else but accused. It ignored consequence of sale deed in favour of M/s Heera Group of companies which has purchased the property out of the proceeds of crime. It was made party to the civil suit yet, an order was passed against the interest of the company holding the property. The accused was otherwise not interested to pursue the claim because in that case, it would have been auctioned in the light of the order passed by the Apex Court.
In the instance case, M/s Heera Retail Pvt. Ltd, was not party to the suit, despite purchase of the property and whose sale deed was never challenged. The decree cannot operate against it. Since the property was owned by M/s Heera Retail Pvt. Ltd., a group company of main accused Smt. Nowhera Shaik, we do not find any illegality in the attachment as the decree of the Civil Court was not binding on the group company of accused M/s Heera Retails Pvt. Ltd. The Apex Court in the case of Niyamat Ali Molla Vs. Sonargon Housing Co-operative Society Ltd. and Ors. [2007 (10) TMI 616 - SUPREME COURT] held that persons not parties to the suit would not be bound by the decree.
The claim of the appellants based on collusive decree by City Civil Court cannot be accepted against others than party to the suit. It is more so when it is going against the sale deed executed in favour of the accused’s Company M/s Heera Retail Pvt. Ltd. and remain unchallenged. No suit for cancellation of sale deed was filed against the said Company and even the sale deed in favour of M/s Neelanchal Technocrats Pvt. Ltd.
The claim of the appellants is based on the Civil Suitwhere M/s Heera Retail Pvt. Ltd. was not a party. The decree in the Civil Suit binds only the parties and not the others. The property came to the accused’s company pursuant to the sale deed in its favour in the year 2016 by M/s Neelanchal Technocrats Pvt. Ltd. who was holding it under the deed and whose title and sale deed was never challenged by the appellants even while filing a suit to claim their right. The execution of sale deed was in the knowledge of the appellant as is coming out from the suit yet it was not challenged. The accused colluded with the appellants after registration of the FIR in the year 2012. The suit was not contested by M/s Neelanchal Technocrats Pvt. Ltd. after a sale deed in favour of M/s Heera Retail Pvt. Ltd. The property of the accused M/s Heera Retail Pvt. Ltd. has been attached as it was purchased out of the proceeds of crime. Thus, there is no case to cause interference in the impugned orders.
The order produced before this Tribunal is dated 28.03.2023 where a detailed order was passed for settling the dues of the investors and therein it was made clear that the property attached by the ED can be released for realization of the dues if the prospective purchasers are willing to deposit the amount of Rs. 641 crores and in that case, the attachment of the ED would be lifted but leaving the parties to take remedies for their respective rights - The subsequent order produced before us is dated 11.11.2024. The reference of the order of the Apex Court has been given to clarify that confirmation of attachment would not in any way affect the investors for realization of the amount, rather the order passed by us would also remain subject to the further direction of the Apex Court in pending cases. The detailed order is, however, passed by this Tribunal to clarify the claim of the appellants. This is not a case to cause interference in the orders.
Conclusion - The decree cannot operate against a person who was not party to the suit. Since the property was owned by M/s Heera Retail Pvt. Ltd., a group company of the main accused Smt. Nowhera Shaik, there are no illegality in the attachment as the decree of the Civil Court was not binding on the group company of accused M/s Heera Retails Pvt. Ltd.
Appeal dismissed.
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2025 (3) TMI 1352
Demand of service tax prior to 01.06.2007 under Interior Decorator Service for the periods prior to June 2007 and from June 2007-September 2009 - invocation of extended period of limitation - demands of service tax under Completion and Finishing services.
HELD THAT:- The Appellant was a registered Service Tax assessee under “Interior Decorator” service w.e.f. 29.01.2008 and under Works Contract Service from 12.10.2009. The SCN were issued proposing demand of service tax under ‘Interior Decorator’ service which were confirmed by the Original Adjudicating Authority and penalties imposed, whereas the impugned order confirmed the demands under Completion and Finishing services for the period only from 16.06.2005. The Appellant maintained that even prior to 01.06.2007, he was rendering works contract services as the contract was a composite one involving supply of materials and labour and hence not chargeable to service tax under Interior Decorator service prior to 01.06.2007 in terms of the Hon’ble Supreme Court’s decision in Commissioner vs. Larsen & Toubro Ltd. [2015 (8) TMI 749 - SUPREME COURT].
A perusal of the appeal records indicate that the assessee is engaged in rendering of services related to carpentry work, false ceiling, flooring, painting, electrical work, civil work, layout of offices, etc. which is squarely covered under Completion and Finishing services which falls within the ambit of Commercial or Industrial Construction service w.e.f. 16.06.2005 and being so such services are also covered under the definition of Works contract services w.e.f. 01.06.2007.
The demands were made under Interior Decorator service and confirmed by the Adjudicating Authority whereas the impugned order confirmed the demands w.e.f. 16.06.2005 under Completion and Finishing services. The impugned order has thus travelled beyond the Show Cause Notice and the demand prior to and after 01.06.2007, for this reason alone, cannot sustain. For the period after 01.06.2007, the demand confirmed by the adjudicating authority was under interior decorator service instead of under Works Contract service and hence the demand is also not legally sustainable. As the demand itself could not sustain, the question of invocation of extended period for demand of duty and penalty does not arise.
Conclusion - i) The services provided by the appellant in respect of the projects executed by them for the period prior to 1-6-2007 being in the nature of composite works contract cannot be brought within the fold of Interior Decorator service in the light of the Hon’ble Supreme Court judgment in Larsen & Toubro. ii) For the period after 01.06.2007, for activities involving indivisible composite works contract, service tax is leviable under ‘Works Contract Service’ as defined under section 65(105)(zzzza) but the demand has been inadvertently made under ‘Interior Decorator’ service/ “ Completion and Finishing services” and hence does not sustain as the demand itself suffers from infirmities.
Appeal allowed.
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2025 (3) TMI 1351
Dismissal of appeal as time barred having been filed after more than one month beyond the period of two months prescribed in Section 85(3A) of the Finance Act, 1994, which cannot be condoned - whether delay in filing the appeal before the Commissioner (Appeals) being beyond the period of 2+1 month can be condoned or not? - HELD THAT:- The appellant bonafide prosecuted the appeal before Meerut Division within the extended period of one month by filing the appeal on 07.07.2017, however on 11.07.2017 the appellant was intimated that the appeal filed before the Meerut Division cannot be transferred internally to Dehradun Division, therefore, the said period needs to be excluded. Further, the appellant diligently prosecuted the appeal by making the pre-deposit amount after seeking due clarification from the department. Here also, the letter dated 14.04.2017 by the appellant was replied by the Department vide letter dated 16.05.2017. The delay in responding to the letter by the Department by almost one month cannot be attributed to the appellant. Therefore, the test laid down under the provisions of Section 14 are fully satisfied. Without going into too many details, if the limitation is computed from the date of the receipt of the order, i.e., 12.04.2017 till the date of filing of the appeal before the Dehradun Division on 13.07.2017, the total period comes to 91 days as against 90 days and if the period before the Meerut Division from 7.07.2017 to 11.07.2017 is excluded by virtue of the provisions of Section 14 of the Limitation Act, the appeal filed by the appellant was within time.
Keeping in view the peculiar facts of the present case, the appellant is entitled to the benefit of the exclusion of time in pursuing the appeal before Meerut Division and, therefore, the appeal finally filed before the Dehradun Division is not barred by limitation.
Conclusion - The appellant's appeal is not barred by limitation due to the exclusion of time spent in prosecuting the appeal at the incorrect jurisdiction. The matter is remanded to the Commissioner (Appeals) for adjudication on the merits, allowing the appellant to have their appeal heard substantively.
Appeal allowed by way of remand.
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2025 (3) TMI 1350
Refund of service tax paid on 60% of the value of services rendered under a reverse charge mechanism - refund can be allowed without modifying the assessment or not - HELD THAT:- Since the issue in the present appeal relates to the refund claim, the same has to be considered in the light of the decision of the Apex Court in the case of ITC Ltd. Vs. CCE, Kolkata-IV [2019 (9) TMI 802 - SUPREME COURT (LB)] where the law has been settled that the refund proceedings being in the nature of execution proceedings, the refund cannot be sanctioned and allowed without modifying the assessment.
In the present case, the appellant had paid the service tax on 60% of the value of the service so rendered and made the refund claim on 5.4.2016. The refund application was decided by the Adjudicating Authority on merits that the refund claim was filed incorrectly as the assessee themselves were liable to pay service tax on 50% of the total value of the billing amount. As the assessee was held to be himself liable to pay duty for which the refund is claimed, the refund claim was held to be unsustainable.
The Tribunal in the case of M/s. Jagdamba Phosphate vs. Commissioner of CGST, Udaipur [2024 (10) TMI 1547 - CESTAT NEW DELHI] held that since the appellant had not assailed the self-assessments and as per assessments, the appellant is not entitled to any refund, the refund claim was rejected.
Conclusion - i) A self-assessed return is considered an assessment, and unless modified, it cannot be questioned in refund proceedings. ii) Refund claims require the original assessment to be challenged and modified through the appropriate legal channels.
Appeal dismissed.
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2025 (3) TMI 1349
Liability of appellant who had registered under the category of Construction of Residential Complex Service to pay service tax for the entire amount for the period from October 2005 to April 2007 - HELD THAT:- It is well settled that service tax on service component of ‘works contract’ became leviable only with effect from 01.06.2007 and demand of service tax under ‘Construction of Residential Complex’ Service is unsustainable as per the judgment of the Hon’ble Supreme Court in the matter of CCE, Kerala vs. L & T Ltd. [2015 (8) TMI 749 - SUPREME COURT].
The issue is no more res integra and it is well settled law that even if the appellant’s activities have been registered under ‘Construction of Residential Complex’ Service and confirming service tax demand prior to 01.06.2007 is unsustainable.
Appeal allowed.
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2025 (3) TMI 1348
Recovery of service tax with interest and penalty - whether service tax would be charged simply on the basis of invoices issued or after completion of services? - HELD THAT:- The Appellant was providing “Real Estate Agent Service”. In the Service Tax Act which came into effect, after introduction of negative list concept, with effect from 01.07.2012, there was no definition of real estate agent. However, prior to negative list regime, real estate agent was defined under Section 65 (88) of the Finance Act, 1994 as a person who was engaged in rendering any service in relation to sale, purchase, leasing or renting of real estate. In common trade parlance also, real estate agent means a person who works with clients to help them buy, sale or rent real estate. It shows that service under the category of real estate agent service is completed when actual sale or purchase or rent of real estate had taken place.
The invoice is required to be issued within 30 days after completion of the service or on receipt of payment towards value of taxable service. The important issue in this case is to ascertain whether the invoices were issued by the Appellant after completion of service or not. In this context, it is found that due to business closure of Amrapali Group of Companies, activities of sale, purchase could not take place. So, invoices issued by the Appellant cannot be treated proper invoice in terms of Rule 4(A) of the Service Tax Rules, 1994. For issuance of invoice, completion of service is an essential condition, which has visibly not taken place in this case. So, no service tax is chargeable on the basis of invoice which was issued before completion of work.
When no demand is sustainable, imposition of any type of penalty is improper and unwarranted.
Conclusion - Service tax is not chargeable on invoices issued without service completion, and demands cannot be based solely on ITR figures without verifying actual service provision.
Appeal allowed.
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2025 (3) TMI 1347
Failure to discharge service tax - whole case of demand was built up merely on the basis of figures shown in Form 26AS statement - discharge of burden to prove - invocation of extended period of limitation - demand of interest and Penalty - HELD THAT:- The demand of service tax was determined merely on the basis of figures of Form 26AS without examining any other document with a view to ascertain as to whether the receipts shown in Form 26AS was in respect of service only. It is a known fact that Form 26AS statement is prepared by the Income Tax Department, not by the taxpayers. There may be chances of error in such statement. It is further seen that the figure shown in Form 26AS statement differ with turnover declared in respective Balance Sheet. The Department have not made any enquiry to ascertain the reason of the difference between figures shown in balance sheet and Form 26AS statement. Neither the adjudicating officer nor the appellate authority has tried to find out nature of services rendered by the Appellant.
Service tax demands require establishing the four elements mentioned above. Shifting burden of proof, The Department cannot solely rely on ITR/26AS discrepancies to shift the burden of proof to the taxpayer. In this context, reference is made to the decision of the Tribunal in the case of United Telecom Ltd., [2010 (10) TMI 730 - CESTAT, BANGALORE] wherein it has been held that no demand can be confirmed unless exact liability is not decided.
Demand of interest and penalty - HELD THAT:- When the demand of tax itself is not sustainable, the demand of interest and imposition of penalty does not survive. Penalty on Shri Arvind Singh Director of the company is also liable to dropped as the demand case against the company of the Appellant does not survive.
Conclusion - i) The service tax demands cannot be based solely on Form 26AS figures without corroborating evidence. ii) The invocation of the extended period of limitation is not justified as the Department had prior knowledge of the liability. iii) Penalties under Sections 70 and 78A and well as interest, are set aside due to the lack of a valid demand.
Appeal allowed.
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2025 (3) TMI 1346
Classification of service - Commercial or Industrial Construction Service or not - construction activities undertaken by the appellant at the police training academy / office premises of Tamil Nadu Police Housing Corporation - Levy of service tax on the repair and maintenance work at police academy which has been carried out by the Appellant - levy of penalty - extended period of limitation.
Classification of service - Commercial or Industrial Construction Service or not - construction activities undertaken by the appellant at the police training academy / office premises of Tamil Nadu Police Housing Corporation - HELD THAT:- The appellant has placed reliance on the decisions of the Tribunal in RD Contractor & Company versus CCE & ST, Anand, vide Final Order No. A/10313-10314/ 2023 dated 22.02.2023, where the Tribunal had considered whether the construction service provided to Gujarat State Police Housing Corporation for construction of residential complex for police staff is liable of service tax and has held that there will be no liability on the appellant therein and has allowed the appeal placing reliance on the decision in the case of S. Kadirvel vs. CCE & ST, Trichy, [2013 (8) TMI 262 - CESTAT CHENNAI], which too has been relied upon by the appellant - The proposal in the show cause notice in the instant case is to cover the construction activities of the appellant rendered to police academy/TNHPC, under commercial or industrial construction service, given the nature of work which is seen more specifically elaborated in Annexure II to the SCN. Moreover, the appellant too has not raised any specific pleading that the activities of the appellant are more specifically covered under “construction of complex” service.
The demand of service tax on the services rendered by the appellant in the buildings at police academy/TNHPC is unsustainable.
Levy of service tax on the repair and maintenance work at police academy which has been carried out by the Appellant - HELD THAT:- When the Department had already proposed to cover the services of the appellant rendered to the aforesaid policy academy under “commercial or industrial construction service”, then we see no reason why the classification of the services rendered by the appellant to police academy in respect of certain activities of repair are thereafter proposed for coverage under the head “management, maintenance or repair service”, when the said definition of commercial or industrial construction itself, under section 65 (25b) (d), included “repair, alteration, renovation or restoration of, or similar services in relation to, building or civil structure”. As such, when the activities of the appellant are prima facie coverable under the limbs of a particular classification being proposed in the SCN, then artificially separating some activity and categorizing it under yet another classification is arbitrary and thus wholly untenable - The demand of service tax made in the SCN on the aforesaid activities of the appellant with respect to Police Academy/TNHPC are not tenable and are therefore set aside.
Levy of penalty - extended period of limitation - HELD THAT:- In the facts and circumstances of the appellants’ case considering that the tenability of the other demands as proposed in the SCN were of debatable nature, even though it is found that grounds for imposition of penalty under Section 78 as invoking of extended period is also held to be tenable, nevertheless, in the circumstances, it is deemed it fit to invoke the provisions of Section 80 as it existed during the relevant period to set aside the penalties imposed - The penalties are set aside, but the extended period for demand is upheld.
Conclusion - i) The construction activities at government-owned institutions not engaged in commerce or industry are not taxable under "Commercial or Industrial Construction Service. ii) The construction of CETP is taxable under "Commercial or Industrial Construction Service" as it serves commercial establishments. iii) The invocation of the extended period for demand is justified, but penalties can be set aside under Section 80 in certain circumstances.
Appeal disposed off.
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2025 (3) TMI 1345
Refund of service tax paid on GTA services which were used for the purpose of export of excisable goods under Notification No. 41/2012-ST dated 29.06.2012 - rejection of claim of the appellant for the entire amount in view of the para 3 (b) of Notification No. 41/2012 –ST dated 29.06.2012 - HELD THAT:- The legislature has used words “person liable to pay service tax” which shows specific intention that the person who pays the service tax under Section 68 will not be eligible to claim rebate. Section 68 (2) starts with non-obstante clause i.e. “Notwithstanding”. Therefore, by virtue of subsection (2) certain category of service receiver become “person liable to pay” and therefore are hit by para 3 (b) of Notification No. 41/2012-ST dated 29.06.2012 - The central government vide notification no. 31/2012-ST dated 20.06.2012 granted exemption from payment of service tax in the case of services provided to an exporter for transport of goods by Goods Transport Agency (GTA). So the exemption from payment of service tax on GTA services for export is well covered by this notification. It shows the intention of the legislature that instead of granting rebate in case of service provided by the Goods Transport Agencies (GTA), where the service recipient is liable for payment of service tax, an absolute exemption from payment of service tax is granted separately.
The learned Commissioner (Appeals) has also cited the decision of Hon’ble Tribunal in case of M/s. Nahar Industrial Enterprises Ltd [2014 (12) TMI 205 - CESTAT NEW DELHI] in which it agreed with the findings of Commissioner (Appeals) who has held that the refund of service tax paid on freight on transportation of goods for export from factory to port of export involved under Section 68(2) of the Finance Act, 1994 was not eligible as per para 2 (a) of the N/N. 17/2009-ST dated 07.07.2009 - The Tribunal in the above case agreed with the above findings of the Commissioner (Appeals) and did not find any ground to interfere in the findings recorded in the order-in-appeal and with these observations the Tribunal dismissed the appeal.
Conclusion - The appellant is not eligible for a refund under N/N. 41/2012-ST due to their status as the person liable to pay service tax under Section 68.
The Commissioner (Appeals) has not committed any irregularity, illegality or error in passing the impugned order - Appeal dismissed.
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