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Showing 141 to 160 of 1441 Records
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2025 (5) TMI 1301
Assessment of society - Temporary parking of such unutilized funds from Government Grants - AO treated the interest income earned as revenue receipt and taxable income of the assessee - Principle of consistency - AO noticed that the assessee had invested Rs. 100 crores in SBI liquid mutual funds during the year and there was a switch from one scheme to another scheme of mutual funds resulting in a short-term capital gain
HELD THAT:- During the assessment year, in question, the income earned i.e. interest from temporary parking of such unutilized funds and short-term capital gains arises from a mere switch between schemes in liquid and mutual funds of the same corpus.
In the present case, it is importantly noted that in the assessee’s own case for the assessment years 2017-18 and 2020-21, the AO accepted the assessee’s claim of exemption and was not made any addition on this count. Hence, two different views cannot be taken in respect of same issue when the material fact are identical and no any discrepancies have pointed out. It is settled law that the violation of principle of consistency is not sustainable in law.
We place reliance on the decision of Radha Soami Satsang vs. CIT [1991 (11) TMI 2 - SUPREME COURT] wherein it was held that ‘though the doctrine of res judicata does not apply to Income Tax proceedings, it would not be appropriate to allow the position to be changed in a subsequent year, where a fundamental aspect permeating through different assessment years has been found as a fact one way or the other and parties have allowed that position to be sustained by not challenging the order for the said years’.
In the present case, the interest income earned on unutilised govt. grant perked temporarily does not constitute taxable income in the hands of the assessee and the short-term capital gains arose out of a claim from mere credit investment is not allowable to be taxed independently especially in the light of consistently acceptance in the subsequent years. Besides that, the assessee in the subsequent years transferred such amount to the Govt. of Assam vide challan no.04/1673 dated 06.04.2018, therefore, the view taken by the authorities below was not correct. Additions made by the AO and confirmed by the CIT(A) are not sustainable in law. Appeal of the assessee is allowed.
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2025 (5) TMI 1300
Rejection of application filed by the applicant Institution u/s 12AB - Incomplete Form 10AB, Non Registration of under Rajsthan Public Trust Act, 1959 and Genuineness of Activities.
Non registration of the applicant under RPT Act, 1959 - As held in APJ Abdul Kalam Education and Welfare Trust [2025 (3) TMI 22 - ITAT JAIPUR] that for the purposes of registration of such institutions, u/s 12AB of the Act, registration under RPT Act, 1959 is not one of the essential requirements.
So, this ground of rejection of the application does not survive any more.
Incomplete Form 10AB & non genuineness of the activities - In the impugned order dealing with application u/s 12AB CIT(E) has described as to in what manner the said application uploaded in Form 10AB was incomplete and also that the applicant did not remove the said deficiencies despite notices. Appellant does not dispute that the applicant did not furnish details in reply to the show cause notices.
The impugned order is dated 17.03.2024. As noticed above, the applicant did not reply the show cause notices. In absence of compliance by the applicant or for want of requisite details or information or documents, learned CIT(E) had no option but to proceed to dispose of the application.
As appellant submits that the matter may be remanded to Learned CIT(E) for decision of the application afresh, after affording of opportunity to the applicant of being heard. Department does not oppose the above said submission for remand of the matter to Learned CIT(E) for decision of the application afresh.
Appeal is disposed of for statistical purpose, and while setting aside the impugned order dated 17.03.2024, application u/s 12AB of the Act is restored to the files of Learned CIT(E) with direction for decision afresh.
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2025 (5) TMI 1299
Disallowing set-off of brought forward unabsorbed depreciation against the income from other sources - HELD THAT:- As brought forward unabsorbed depreciation needs to be added to current year depreciation and is treated as current depreciation loss. Once it takes the colour of current year depreciation then it becomes eligible for set-off against other income as provided in section 72(1) of the Act.
The above provisions is squarely applicable in the facts of the instant case and, therefore, the claim of the assessee of setting-off of unabsorbed depreciation brought forward from preceding year against the current year income from other sources is valid and deserves to be allowed. CIT(A) is set-aside. Effective grounds of appeal raised by the assessee are allowed.
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2025 (5) TMI 1298
Disallowance on account of transfer expenses claimed by appellant under the head Capital Gains - AR argued that the transactions of cancellation charges are duly recorded and are genuine being through banking channel, therefore, these are allowable as deduction while calculating the claim of assessee under Capital Gains - HELD THAT:- We observe that alleged agreements are executed within the group entities, in absence of any corroborative evidence to prove the genuineness of such transactions / agreements such as, registered agreements, no actual payment of advance for executing the agreement or payment of compensation for cancellation of agreement, only ledger adjustments are made.
We, find substance in the finding of AO, which is further approved by the CIT(A) and rightly so for the reason that the entire exercise to prepare an unregistered agreement on a plain paper, resolution and ledger entries for payments of cancellation charges are just an afterthought in the form of self-made evidence for evasion of legitimate taxes though colourable devise which is not permissible within the framework of law. We, thus, approve the decision of Ld. CIT(A) on merits. In result Ground no. 1 of the assessee’s appeal, stands dismissed.
Proceedings of assessment u/s 143(3) as transferred from DCIT-2(1) to DCIT-1(1), Raipur - mandatory order u/s 127 was not passed and, therefore, the same was stated to be not traceable on records by the revenue - The decision in the case of Roop Das [2024 (4) TMI 1151 - ITAT RAIPUR] have a strong bearing on the identical facts in the present case, consequently, the impugned order dated 11.12.2017, dehors an order of transfer u/s 127, cannot survive, as the validity of jurisdiction assumed by Ld. AO i.e., DCIT-1(1), Raipur, who had framed the assessment, which was initiated by DCIT-2(1), Raipur was not validly transferred.
As the impugned order u/s 143(3) dated 11.12.2017 was framed by Ld. AO i.e., DCIT-1(1), Raipur, in absence of vested assumption of jurisdiction, thus, respectfully we hold that the impugned assessment order cannot survive for the want of valid assumption of jurisdiction, the same therefore, stands quashed.
Assessment framed by the AO i.e., DCIT-1(1), Raipur u/s 143(3) of the Act quashed.
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2025 (5) TMI 1297
Charitable trust - Working of accumulation u/s. 11(1)(a) - AO allowed 15% accumulation u/s. 11(1)(a) after reducing the administrative & establishment expenses from the gross receipts/income - AO worked out accumulation u/s. 11(1)(a) of the Act by taking net receipt in place of gross receipt/income - HELD THAT:- DR has pointed out that the assessee has earned certain interest income from bank deposits. The question here is not about income earned by the assessee but, about the expenditure as to whether the administrative and establishment expenses incurred by the assessee shall be treated as part of application of income for charitable activities. The assessee, nonetheless, under the relevant provisions of section 11 is entitled to accumulate 15% of its income for subsequent application and the mode of accumulation has also been provided under the relevant provisions of sec. 11 of the Act and one of the mode is by deposit of the amount with a scheduled bank also. Therefore, there is no dispute relating to the deposit of the amount in the bank or earning of interest in this case. The proposition of law in the case of ‘Birla Janahit Trust’ [1990 (8) TMI 5 - CALCUTTA HIGH COURT] has been decided in favour of the assessee, therefore, we do not find any reason to interfere with the order of the Ld. CIT(A) on the above issue and the same is hereby upheld.
CIT(A) in allowing the accumulation u/s. 11(2) as against the action of the AO in denying the same on the ground that no specific purpose for such accumulation has been mentioned in form No. 10 by the assessee and, therefore it did not specify the conditions laid down u/s. 11(2) - CIT(A) has held that the assessee had made clear statement and set out the purpose for which the income is to be set apart. CIT(A) has relied upon various case laws to the effect that it was enough if the assessee mentioned a specific object regarding accumulation of income and it is not necessary to give a detailed plan as to how and in what manner the said expenditure will be incurred.
Even in the case of Trustees of Singhania Charitable Trust [1991 (7) TMI 16 - CALCUTTA HIGH COURT] relied upon by the Ld. DR has specifically held that a charitable trust in no circumstances can apply its income, whether the current or accumulated, for any purpose other than the objects for which it stands. It has been further held that the accumulation u/s. 11(2) of the Act requires specification of the purpose out of multiple purposes for which the trust stands. What has been held in the said case is that the assessee trust cannot simply claim to accumulate income for objects of the trust in general in blanket manner. The aforesaid case law is, therefore, supports the case of the assessee. In view of this, there is no merit in the submissions of the Ld. DR.
No infirmity in the order of the Ld. CIT(A) on this issue and the same is hereby upheld.
Appeal of the revenue stands dismissed.
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2025 (5) TMI 1296
Taxability of Price of lottery win - addition was made by the AO stating that this amount had to be taxed u/s 115BB(ii) at higher rate - contention of department is that the alleged amount has been won in lottery whereas the assessee has contended that it is in the nature of a gift - HELD THAT:- Neither in the order of AO nor in the order of CIT(A), this fact has been adjudicated. In order to ascertain the taxability of an income, the relevant facts needs to be verified.
Set aside the order of ld. CIT(A) and remand the matter back to the file of Assessing Officer for necessary verification - Assessee appeal allowed for statistical purposes only.
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2025 (5) TMI 1295
Denial of LTCG exemption u/s 10(38) - Bogus LTCG arising from sale of shares of a company considered as a penny stock - HELD THAT:- No malice or malafide could be attributed on the purpose of assessee venturing into investment in shares of Unno Industries Limited. Moreover, the payment for purchase of those shares, though allotted to him on preferential allotment basis, had been made by account payee cheque and share certificates to that effect were physically received and duly dematted with the registered depository participant.
Shares were purchased in assessment year 13-14 after obtaining the approval of the Hon’ble Bombay High Court approving the merger. No action whatsoever or adverse inference drawn on the assessee in the year of purchase of shares. When those shares are kept in demat account which were sold by the assessee in the open market after duly suffering STT, the same cannot be doubted by the revenue.
We find that there is no case for making any addition u/s 68 of the Act in the hands of the assessee by denying the exemption under section 10(38) of the Act for the LTCG on sale of shares of Unno Industries Limited in the facts and circumstances of the instant case. Accordingly, the grounds raised by the assessee are allowed.
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2025 (5) TMI 1294
Rejection of application filed by the assessee trust for granting approval u/s. 80G(5)(vi) - Charitable activity u/s 2(15) or not? - HELD THAT:- The assessee trust is not a religious trust since the temple is open to the public irrespective of the caste, creed, sex, colour etc. Further, the activity of doing annadanam to the public at large cannot be treated as a religious in nature based on the findings given by the Nagpur and Pune benches of the Tribunal.
The order of the CIT cannot be sustained. CIT had also not furnished any specific instances in support of his allegation that the assessee is a religious trust. It is also not the case of the Revenue that the trust imposed various restrictions on the public to enter the temple and to have the annadhanam. When there is no specific instances of violations it cannot be simply alleged that the assessee trust is a religious trust. In these circumstances the denial of approval u/s 80G of the Act is not correct.
We set aside the order of the CIT (E) and hold that the assessee is not a religious trust and therefore they are entitled for approval u/s. 80G(5)(vi) - Appeal filed by the assessee is allowed.
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2025 (5) TMI 1293
Suit filed on the ground of limitation after 18 years - application filed under the provision of Order VII Rule 11 of Code of Civil Procedure - seeking possession of the suit premises -section-4 of Benami Transaction Act,1988 - name of the plaintiff could not be entered into in revenue record - cause of action to file the suit has arisen as the sale deed has been executed by defendant No.1 on 14.08.2006 and thereby for the first time defendant No.1 has breached the faith and trust put by the plaintiff by virtue of the understanding that was arrived at in the year 1989 - HELD THAT:- In view of the fact that the trial Court has also framed issue with respect to whether the issue of suit being hit of section-4 of Benami Transaction Act,1988 and also on the point of limitation. The fact remains that the judgments on which the learned advocate for the defendant relies are on the issue of limitation but in view of the fact that the plaintiff has categorically stated in the plaint that the plaintiff has claimed that he gained knowledge of the fact that the defendant is not ready and willing to abide by the understanding that have been arrived at between the plaintiff and defendant No.1 in the year 1988 whereby the defendant had agreed not to transfer, assign, sell the property and had also admitted the fact that the plaintiff is the owner of the property and the plaintiff has paid the entire sale consideration. In view of the said fact, the judgment on which the defendant has relied will not be of much assistance to the defendant, and therefore, when the plaintiff is alleging that the fraud has been committed by which the defendant is not ready and willing to abide by the understanding arrived at between the plaintiff and defendant and for the first time has committed the breach of the said agreement by executing the sale deed only in the year 2006, therefore, the said issue can only be decided after leading oral evidence and the said issue cannot be decided summarily and the same being triable issue the suit cannot be thrown out at the thresh hold and the defendant cannot pick up the few sentence, and therefore, from the plaint and content that the defendant had knowledge about the breach committed by the defendant.
It is true and settled law that though Court is required to be extremely careful regarding frivolous and vexatious litigations creeping in the judicial system and consequently abusing the process of law. This requires Courts to exercise their power under Order VII Rule 11 to nip such litigation in the bud.
It is therefore settled law that such a drastic step cannot be taken when upon a holistic reading of the Plaint, it does not appear to be barred by any law or discloses a cause of action (along with the other grounds of the said Rule). In such situations, the Plaint must go to trial and the Trial Court in accordance with law may allow or reject the same as deemed appropriate.
Thus, this Court does not deem it fit to take recourse of the drastic powers conferred under Order VII Rule 11 for rejection of the Plaint and accordingly, the present Civil Revision Application is dismissed. The connected Civil Application, if any, shall also stand dismissed.
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2025 (5) TMI 1292
Maintainability of the petition - patent error is apparent on the face of the record - Confiscation and non-release of the counterfeit goods bearing the respondent’s/ plaintiff’s trademark/ label under consignment - learned Trial Court erred in moving ahead with suo moto commencing with the proceedings without having jurisdiction to do so - HELD THAT:- As per the settled position of law, a Court which does not statutorily, or otherwise, have jurisdiction to try and entertain a proceeding cannot suo moto confer/ assume jurisdiction upon itself in any manner and/ or any reason whatsoever.
Admittedly, even though the petitioners have participated in MISC DJ/3623/2024 before the learned Trial Court and had given up their challenge to all the orders barring that of 17.01.2025 passed therein before this Court on 02.05.2025, the same would not and in fact cannot preclude this Court to take into account the cumulative facts that the learned Trial Court is acting without any jurisdiction to try and/ or entertain the proceedings not before it and accordingly proceed for adjudication of the present petition under Article 227 of the Constitution of India which empowers the High Courts to exercise “…superintendence over all Courts and Tribunals throughout the territories in relation to which it exercises jurisdiction”.
Even though the law qua exercising the rights under Article 227 of the Constitution of India is well settled that the High Courts should not exercise its power of superintendence at the drop of a hat, however, at the same time, it is also a settled position of law that on coming across any patent perversity in the orders of any Court and/ or Tribunal which is glaringly visible, the High Courts applying the equitable principles, should exercise its power to keep strict overall administrative and judicial control over any Court and/ or Tribunal under its jurisdiction. The High Courts are required to step in, if called for, when such a situation, as above, is brought to the notice.
The present case is such wherein, the patent error is apparent on the face of the record, which if permitted to stand, shall lead to traversity of justice. The learned Trial Court cannot be allowed to proceed against the Statute and this Court has to stand by the principles of equity, justice and good conscience, more particularly, when the suit itself stood decreed on 19.10.2024 by the very same learned Trial Court.
As a result, upon a wholistical consideration of the factual matrix involved coupled with the provisions of Statute, as also the existing position of law, in the considered opinion of this Court, the present petition under Article 227 of the Constitution of India is maintainable in the present form before this Court.
Thus, the present petition is allowed and the order dated 17.01.2025 passed by the learned Trial Court in MISC DJ/3623/2024 is set aside. Resultantly, the proceedings initiated by the learned Trial Court in MISC DJ/3623/2024 and the orders passed therein are also set aside.
The present petition alongwith the pending applications stands disposed of.
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2025 (5) TMI 1291
Seeking directions to pass a consolidated or separate speaking order(s) under Section 17 (5) of the Customs Act, 1962 - liability of goods to be charged to Customs Duty under Customs Tariff Heading - classification of identical goods - No opportunity of personal hearing - HELD THAT:- In view of the fact that the Show Cause Notice with regard to the classification of identical goods has already been issued, this Court is of the opinion that the proceedings need not be multiplied. In respect of the earlier bills of entry, provisional release has already been undertaken. In respect of the above bills of entry, as per the Petitioner, the customs duty has been paid in terms of the classification given by the Department, under protest.
Accordingly, let the proceedings in the Show Cause Notice dated 15th January, 2025 continue. Considering the fact that the issue raised in both the proceedings are same and the goods involved are also identical, the adjudication of the Show Cause Notice dated 15th January, 2025 shall bind the earlier bills of entry as also the set of present bills of entry.
An opportunity of personal hearing shall also be given to the Petitioner.
After hearing the Petitioner, the Adjudicating Authority shall take a decision in respect of the classification of the goods as to whether they would fall under CTH 85168000 and CTH 85169000.
The writ petition is disposed of in these terms.
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2025 (5) TMI 1290
Seeking grant of Bail - Smuggling - seizure of gold - evasion of Customs Duty - HELD THAT:- In view of recovery of 3 kg of gold, the learned Metropolitan Magistrate has rightly observed that it comes under the category of bailable offence and has rightly granted bail to the Respondents. It is submitted that there is no infirmity in the Bail Order and the present Petition is liable to be dismissed.
The allegation of remaining 8 kg of gold is concerned, there is no recovery affected from the Respondents but was mentioned by the Respondents in their statements.
The learned Metropolitan Magistrate vide impugned Order dated 09.06.2018 has considered the facts and has granted Bail. It is only incidentally mentioned that the offence disclosed is ‘bailable’, whereas the Bail has been granted considering the entire facts of the present case.
There is no infirmity in the impugned Order dated 09.06.2018. The present Petition and pending Application are accordingly dismissed.
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2025 (5) TMI 1289
Suspension of the Customs Broker licence - mis-declaration of description and values of the goods - exporter found to be non-existent - Show Cause Notice [SCN] issued - HELD THAT:- Nothing in the Customs Act or the CBLR authorizes the Customs Broker to examine the goods. The Customs Broker has to file Shipping Bills as per the documents and the goods are then brought into the Customs area such as the ICD (this process is called carting) and handed over to the custodian of the ICD. The custodian has to present the goods to the Customs officers if they wish to examine them. The Customs broker often assists in the process but neither the Customs Broker has any authority nor responsibility to examine the goods or verify them. Therefore, if the goods are found to be different than what is declared in the shipping bill, the Customs Broker cannot be held responsible.
The goods were declared to be of a certain FOB value in the Shipping Bills and other documents but when the customs officers conducted market enquiries, the goods were found to be of a fraction of the value in the market. We find that the Customs Broker has no authority or responsibility to verify the FOB value of the goods (which is the transaction value decided between the buyer and seller) or check the market value of the goods (i.e., the value at which such goods are sold in Indian market). Therefore, suspension of the appellant’s Custom Broker licence on this ground is also not correct.
The case of the department is that Customs officers went to the registered premises of the exporter and found the exporter firm to be non-existent. Evidently, either the officer who verified the premises is not correct or all the other authorities who issued Aadhar, PAN, IEC and GST registration are not correct. Either way, it cannot be said that the appellant had not verified the existence of the exporter. We therefore, find that confirmation of suspension on this count is also not correct.
On 1.2.2024, the GST Commissionerate replied that the exporter was found to be non-existent and that its registration was concealed suo moto with effect from 7.2.2023. It is only after verification by the GST officers, pursuant to the letter dated 3.1.2024, it appears that the GST Registration was cancelled with effect from 7.2.2023. The impugned order does not say when the GST Registration was cancelled (although it was cancelled effective from 7.2.2023). Until the cancellation, not only the appellant but even the department was operating under the assumption that the appellant existed.
Thus, we find that confirmation of suspension of the Customs Broker licence of the appellant in the impugned order cannot be sustained and needs to be set aside. Nothing in this order would affect the proceedings under the SCN for revocation of licence. It shall be decided by the inquiry officer and the Commissioner un-influenced by any observation made in this Order.
The appeal is allowed and the impugned order is set aside. The suspension of the Custom Broker licence of the appellant is set aside with immediate effect. The original licence and all the F/G/H cards, if already surrendered to the Customs, shall be returned to the appellant.
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2025 (5) TMI 1288
Denial of transaction value of the goods - confiscation - payment of redemption fine - Admissibility of the computer printouts in the absence of any certificate issued under section 138C of the Customs Act - imports iron screws/ self-drilling screws from China - issuance of SCN - e-mail correspondence between another supplier and other receiver of goods - statement made under section 108 - HELD THAT:- Regarding the printout of the e-mails it needs to be noted that the two panchnamas recorded on 29.03.2017 do not refer to any printout of the e-mails having been taken. In fact, the only reference to the printouts of the e-mails having been taken is contained in the statement of Mahesh Sabharwal recorded under section 108 of the Customs Act on 14.09.2017.
The said statement does not indicate from which electronic device the printout was taken. It was absolutely necessary for the department to have taken the printouts during the process of recording of the panchnama or in the presence of witnesses. It appears that the printouts were taken on 14.09.2017, as is clear from the statement of Mahesh Sabharwal recorded under section 108 of the Customs Act.
This apart, the printouts of the emails contain quotations of different suppliers and not to the supplier of the appellant and they are not the final prices. The printouts also relate to another importer of M/s Sagar Impex and it is stated that Khusagar Aggarwal of Sagar Impex had admitted the prices in his statement made under section 108 of the Customs Act. It was necessary for the department to have not only substantiated that screws that were imported by M/s Sagar Impex and that by the appellant were of the same quality and were made at about the same time but to have also examined Khusagar Aggarwal in the present proceedings for his statement made under section 108 of the Customs Act in some other proceedings could not have been relied upon in the present proceedings.
If the emails and the statement of Mahesh Sabharwal are discarded, then there is absolutely no evidence for rejection of the transaction value declared by the appellant.
Thus, the impugned order rejecting the transaction value under rule 12 of the 2007 Valuation Rules cannot be sustained. The re-determination of the transaction value, therefore, would not arise.
Such being the position, the order for payment of redemption fine and for imposition of penalty upon the appellant and Mahesh Sabharwal cannot be sustained.
The impugned order dated 31.08.2020 passed by the Principal Commissioner is, accordingly, set aside and both the appeals are allowed.
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2025 (5) TMI 1287
Undervaluation of goods - Rejection of transaction value declared by the importer for the imported motorcycle inner tubes - discharge of burden of proving undervaluation by adducing cogent reasons and evidence justifying the rejection of the declared transaction value - to be valued as per section 4 of CEA or section 4A.
Admission and acceptance by the appellant the charge of undervaluation - HELD THAT:- It cannot be ignored that the appellant had filed B/E dated 17.02.2011 for clearance of motorcycle tubes and pursuant to an intelligence the statement of Shri Kulvinder Pal Singh was recorded on 11.03.2011 and 18.03.2011 where he admitted the price to be at Rs. 32 per piece and also paid the duty on enhanced assessable value on the date of the statement itself. Further, they also waived the requirement of show cause notice and personal hearing so as to avail early clearance of the consignment. Merely because the appellant has accepted the higher value and also made the payment of differential duty does not absolve the department from discharging their responsibility under the provisions of section 14 read with Valuation Rules.
In the present case, it is not found that the department has discharged its burden of carrying out the requisite exercise and conducting enquiry with reference to the nature of the imported goods, being ‘unbranded’ along with other factors like quality, quantity, time and country of origin etc. The goods imported by the appellant were ‘unbranded’ and it was therefore, relevant that the comparable goods should be of the same category ‘unbranded’ as there is bound to be marked difference in the valuation of ‘branded’ and ‘unbranded’ goods which is not forthcoming from the records. No such evidence has been led by the department to ascertain the price for such re-assessment.
Considering the fact of the present case, the decision of the Ahmedabad Bench of the Tribunal in CMR Nikkei India (P) Ltd. Vs. Commr. of Customs [2022 (8) TMI 114 - CESTAT AHMEDABAD] referred, where the dispute was regarding the valuation of the goods imported by the appellant and the assessing authority reassessed the imported goods at values higher than what was declared in the Bills of Entry and the importer had accepted the enhanced value by submitting the consent letter. The Tribunal was pleased to observed that 'in spite of the admission on behalf of the importer, the Revenue is required to satisfy the requirements prescribed under Section 14 of the Customs Act read with Customs Valuation Rules before any enhancement of valuation.'
Reliance has been placed on the contemporaneous imports available in NIDB data which showed the value of the impugned goods and which has been relied on by the authorities below. In the case of M/s Sedna Impex Pvt Ltd. vs. Commissioner of Excise, Mundra [2023 (3) TMI 1080 - CESTAT AHMEDABAD], the Tribunal observed that the declared value cannot be enhanced merely on the basis of the NIDB data. From series of decisions we find that the Tribunal has taken a consistent view that the declared value cannot be enhanced solely on the basis of NIDB data or in other words NIDB data cannot be made the basis for enhancement of the declared import value.
The basic allegation of the department is that the declared value of the impugned goods were found different being on the lower side as the goods were required to be subjected to countervailing duty based on RSP under section 4A of CEA - Section 4A makes it clear that it applied only in those cases where there is an allegation to print RSP on the packages of the goods under the provisions of SWMA or the Rules made thereunder. In terms of section 4A, Central Government had issued Notification No. 49/2008-CE(NT) dated 27.02.2008 and Sl. No. 108 therein refers to as “parts, components and assemblies of automobiles”.
Since in the present case the inner tubes were imported by the appellant in the packing of 50 pieces per cartons and the said tubes were not in individual package, reliance has been placed on Circular No. 625 dated 28.02.2002 which provides that in case of bulk packing there is no requirement of declaring RSP on the packages under the provisions of SWMA or the Rules made thereunder. The findings in the impugned order is that since the appellant has not shown that the inner tubes were sold only in the packing of 50 pieces per cartons the benefit of said circular is not available.
The learned counsel for the appellant has referred to a decision of this Tribunal in Titan Industries Limited vs. Commissioner of Customs, Chennai [2007 (6) TMI 357 - CESTAT, CHENNAI], where the appellant as manufacturer of Titan brand watches had imported button cells declaring them as for own use and cleared on payment of duties based on the transaction value. The adjudicating authority concluded that the impugned imports attracted assessment of CVD on RSP as provided under section 3(2) of the Customs Tariff Act, 1975 and demanded differential duty. Reliance was placed on Circular No. 625 and it was urged that the impugned goods were imported packed in thermo formed trays, each tray holding 100 button cells with 10 such trays shrink wrapped and stacked in a carton and each shipment consisted of Rs.1,50,000/- thousand button cells so packed. It was, therefore, argued that the imports were in bulk packages and did not attract MRP based assessment. In view of the clarification given in the Circular it was held that imported goods do not attract section 4A for the purpose of assessment of CVD. Considering the facts of the present case, it is opined that the decisions in the case of Titan Industries is squarely applicable as the tubes were purchased in bulk and not in retail packaging and are, therefore, not covered for assessment under the provisions of Section 4A.
Conclusion - The declared value cannot be rejected, merely on the statement of the Proprietor. The department has failed to exercise its power in conformity with the provisions of section 14 read with the Valuation Rules so as to adduce cogent reasons to establish the charge of undervaluation. Further, to re-determine the valuation of the imported goods, there are no sufficient evidence satisfying the test of equivalence in comparison to the imported goods. In the absence of requisite exercise to collect cogent evidence to arrive at reassessment, the goods have to be assessed on the basis of the declared value/transaction value.
The impugned order is unsustainable and is hereby set aside. The appeal is, accordingly, allowed.
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2025 (5) TMI 1286
Seeking Rectification of Mistake in the Final Order - wrong comparison of features of various goods - Mistake apparent from the record - correct comparison between the products involved in the impugned Bill of Entries - Tribunal concluded that the goods covered in Table One are the goods which are covered under the previous Bill of Entry dated 16.02.2018 as dealt with in previous Final Order of the Tribunal which was upheld by the Hon'ble Supreme Court in Commissioner of Central Excise, Calcutta versus A.S.C.U. Ltd. [2002 (12) TMI 87 - SUPREME COURT] and Table Two is held to mention, the goods as different from the goods in Table One.
HELD THAT:- The perusal clarifies that the sole ground on which the Rectification of Mistake is allowed is that the error should be apparent form the record. This phrase for “mistake apparent from record” was earlier explained by Hon'ble Supreme Court in the case of T.S. Balaram, Income Tax Officer versus Volkart Brothers - [1971 (8) TMI 3 - SUPREME COURT], wherein it was held that a debatable action of law cannot constitute a mistake apparent from the record on it two opinions are considerable. Such point cannot be said to be error apparent on the face of record. It further clarified that a mistake apparent on record must be an obvious and patent mistake and should not be something which has to be established by a long drawn process of reasoning on the points on which there may conceivably be the two opinions.
The impugned Final Order No. 58770 of 2024 dated 03.10.2024 is in the appeal filed before this Tribunal assailing the said order-in-appeal dated 31.10.2019. Foremost the mistake pointed out i.e. the comparison of features of various goods cannot be appreciated without a long drawn process of reasoning and is a situation where two different views are possible. Consequently, the mistake pointed out is denied to be the error apparent in the present final order. As pointed out by learned authorized representative the Table One of Paragraph 14 is same as the one mentioned in the show cause notice.
Thus, we hold that the appellant through a new Counsel, than the one who made submissions at the time of passing of the impugned final order, is trying to seek re-hearing in the present appeal under the garb of seeking Rectification of Mistake in the final Order dated 03.10.2024. It has already been held that there is no such error as is apparent on face of the impugned final order. Consequently, the application is hereby dismissed. Be consigned to the records along with the appeal, already consigned.
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2025 (5) TMI 1285
Imposition of penalty under Section 112(b) of the Customs Act, 1962 - Allegation of undervaluation - scrap imported from various countries - Entitlement to the same reliefs - appellant, being a co-accused similarly placed as the main accused and other co-accused - HELD THAT:- This Court finds that issue is no more res Integra and has been decided after elaborate arguments and findings, in the in the matter of M/s. Agarwal Metal and Alloys, Vipul Agarwal, Samir Agarwal, Ramesh Kumar H. Jain Vs. C.C.-Kandla [2020 (2) TMI 644 - CESTAT AHMEDABAD], inter alia, absolved the main accused in any charge of under valuation. There can be no reason to uphold the penalty against present appellant on the basis of similarity of facts.
Thus, the appeal of the appellant on penalty is liable to succeed, the penalty of Rs. 2,00,000/- imposed on the appellant under Section 112(b) of the Customs Act, 1962 is liable to be set aside. Same is ordered, accordingly.
Appeal is allowed with consequential relief.
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2025 (5) TMI 1284
Time limitation - Levy of service tax - transportation charges borne by the appellants and reflected in their Profit & Loss accounts - the consignment agents had paid the freight and discharged the service tax liability on such freight amounts - Cenvat Credit on the service tax paid on GTA (Goods Transport Agency) services by their consignment agents - HELD THAT:- Appellant were subjected to regular audits even previously and all the records were made available as is evident from final audit reports of dates 15.03.2012 and 08.03.2013. They were filing returns regularly and the department was well aware about the facts of the transportation charges not paid by the appellants and that all the information for the purposes of present show cause notices has been found out from their records only and nothing in any case was concealed. They have relied on various case laws including of MTR Foods Ltd. [2010 (10) TMI 994 - CESTAT BANGALORE], SDL Auto Pvt Ltd [2013 (8) TMI 425 - CESTAT NEW DELHI], Trans Engineers India Pvt Ltd [2015 (9) TMI 787 - CESTAT MUMBAI] for their purpose. That all facts and figures and transactions were duly reflected in their ledger accounts as well as balance sheets for the relevant year, and were called out from their available documents only.
The extended of limitation cannot be applied. Even on merits, it is not denied that the consignment agent(s) to whom they were the principal had paid the amount of freight and since, under Rule 2(1)(d)(iv) of the Service Tax Rules, 1994, the service tax can be paid either by the person who is liable to pay freight or through his agent. In the instant case, service tax as per law was paid by the consignment agent (who had paid freight on behalf of the appellant) which was later on claimed from the appellant who showed in his books as expense. It is not disputed that the consignment agent(s) had paid the service tax in the case and therefore, there was no loss of Revenue to the Government.
Cenvat Credit on the service tax paid on GTA (Goods Transport Agency) services by their consignment agents - HELD THAT:- The lower authority has confirmed demand on the ground that the appellant has not produced eligible documents. Vide written submission dated 14.05.2025, the learned Advocate has produced copy of ST-3 returns of one of their Consignment Agent M/s Yashoda Traders to show that the Consignment(s) have not taken the Cenvat credit. Still, the appellant has to produce valid/eligible documents for availing Cenvat credit as required under Rule 9 of the Service Tax Rules - It is deemed fit to remit this matter to the adjudicating authority with liberty to the appellant to produce eligible/valid documents justifying availment of Cenvat credit. The learned Adjudicating authority will decide the matter after verifying the documents and pass reasoned order within three months from the date of receipt of this order. Needles to say, the appellant shall produce eligible documents before the said authority within one month.
Conclusion - i) Service Tax on GTA Services are required to be paid by the person who pays or is liable to pay freight either himself or through his agent for the transportation of such goods by road in goods carriage. ii) Since all the facts and information were available to the officers of the department, there is no question of suppression of any information from the department and, therefore, it can be safely concluded that there is no suppression of facts with intent to evade payment of service tax in the instant case and hence, the proviso to Section 73(1) of the Finance Act, 1994 relating to extended period cannot be invoked in this case. iii) Cenvat credit can even be availed on mentions challan evidencing payment of service tax by the service recipient,". The appellant must produce eligible documents for verification by the adjudicating authority.
Appeal disposed off.
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2025 (5) TMI 1283
Liability to pay service tax - Commercial or Industrial construction service - Appellant who had carried out works contracts is liable to pay service tax or not - HELD THAT:- The new category of 'works contract service' was introduced w.e.f. 01.06.2007 with an intent to tax service element in the works contract.
Following the ratio of the judgment in CCE, Kerala VS Larsen & Toubro Ltd [2015 (8) TMI 749 - SUPREME COURT], service provided in relation to execution of a "Works Contract" is liable to service tax only from 01.06.2007. It is found that appellant was paying service tax from 1.6.2007 to 31.03.2009 under Works contract service and the demand as per impugned order confirmed service tax for said period also under the category of “Commercial or Industrial construction service”. For the period up to 01.06.2007, the appellant is not liable for payment of service tax for the execution of works contract following the ratio of the judgment of the Hon'ble High Court in the matter of the Larsen & Toubro Ltd. [2015 (8) TMI 749 - SUPREME COURT]. Further, for the period 01.06.2007 to 31.03.2009 the appellant has paid service tax under 'works contract service'. Therefore, the confirmation of entire demand of service tax for the period 10.09.2004 to 31.03.2009 under the category of “Commercial or Industrial construction service” is unsustainable, hence the impugned order is set aside.
Conclusion - The service tax liability on works contracts is governed by the introduction of the 'Works Contract Service' category effective 01.06.2007, and prior to this date, no service tax is leviable on such contracts under the 'Commercial or Industrial construction service' category.
Appeal allowed.
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2025 (5) TMI 1282
Clandestine removal - Seizure of Pen Drive from the premises of another party, contains the “Production & Dispatch of Sponge Iron” - Demands along with interest and penalty - difference between the Excel Sheet production figure and the RG1 figure - excess / unaccounted production of sponge iron - modus operendi - HELD THAT:- We find that apart from heavily relying on the pendrive and recorded statements, the Revenue has made no effort to bring in corroborative evidence to fortify its claim of clandestine removal. There is no discussion about procurement of materials / inputs, the input – output ratio analysis, electricity consumption, statement of purported sellers of inputs, purported buyers of the finished goods, movement of vehicles and statement of such vehicle drivers / owners. While the Revenue is not required to bring in pinpoint and precise evidence but still efforts have to be made to ensure that sufficient evidence is produced in support of their case.
From the present proceedings, we find that even within the pen-drive the Revenue claims that part of the same is accounted for in the RG 1 records and clearance has been made on payment of Excise Duty. The quantification has been done by comparing the RG 1 sales figures vis-à-vis the figures shown in the Pendrive data and admittedly the author of the Pendrive is not known and no statement has been recorded to this effect from that person. The procedure prescribed under the statutory provisions have not been followed while relying on the data contained in the pendrive.
As we have observed that entire case in respect of the all demands on different heads as observed in the table referred above, has been built up with miniscule evidence, with no corroborative evidence brought in whatsoever. Therefore, we have no hesitation to apply the ratio of the cited case laws in respect of Pendrive, non-allowing of cross-examination of the persons recording the statements, non-production of corroborative evidence, and set aside the impugned order on these counts in respect of the confirmed demands of Rs.1,47,93,916/-.
Since the demands are being set aside, the corollary interest and penalties also get aside.
The impugned Order is set aside towards the confirmed demand of Rs.1,47,93,516/- along with interest and penalty thereon. The penalty on the second appellant is set aside and appeal is allowed.
The appeals are disposed off thus.
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