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Showing 241 to 260 of 1658 Records
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2024 (10) TMI 1418
Rate of GST for hydrated lime/slaked lime - Advance Ruling - classification and HSN Code for supply of slaked / hydrated lime manufactured by the applicant containing less than 98% of the Calcium Oxide and Calcium Hydroxide - determination of the liability to pay tax on any goods or services or both - What should be the classification and HSN Code for supply of slaked / hydrated lime manufactured by the applicant containing less than 98% of the Calcium Oxide and Calcium Hydroxide?
Classification and HSN Code - HELD THAT:- The All India Lime Manufacturers Association (AILMA) which is apex body for lime manufacturers and suppliers in India having registration number 63735 and CIN IJ91900RJ2019NPL063735 located at Jodhpur sought clarification from Honorable Commissioner (GST) of both center (CGST) and Rajasthan state (SGST) in which the department vide clarification letter dated 06.03.2020 & 16.02.2022 has clarified that Hydrated lime/Slaked Lime and Quick Lime with purity less than 98% falls under HSN heading 2522.
Thus the goods in question fall under the HSN 2522 and accordingly the rate of tax applicable on the same in accordance with rate notification no. 1/2017-Central Tax (Rate) shall be 5%.
Classification and HSN Code for supply of slaked / hydrated lime manufactured by the applicant containing less than 98% of the Calcium Oxide and Calcium Hydroxide - The laboratory analysis reports furnished by the applicant reveals that the calcium hydroxide/oxide composition in the said goods are less than 98% and impurities are also available in such goods.
Applying the above, to the case at hand, we find that the goods to be supplied is slaked lime and hydrated lime of purity less than approximately 98% merit classifiable under CTH 2522 20 00.
We hold that slaked/hydrated lime manufactured by the applicant containing less than approximately 98% of the calcium oxide and calcium hydroxide, are classifiable under CTH 2522 20 00 taxable at 2.5% CGST and 2.5% SGST as per entry Sl. No. 131 of Schedule I of Notification No. 1/2017-C.T. (Rate), dated 28-6-2017 as amended.
RULING
Q. 1 What should be the classification and HSN Code for supply of slaked lime manufactured by the applicant containing less than 98% of the Calcium Oxide and Calcium Hydroxide?
Ans-1 The classification and HSN for supply of slaked lime manufactured by the applicant containing less than approximately 98% of the calcium oxide/hydroxide is classifiable under CTH 2522 20 00.
Q2. What shall be the rate of tax on the said product?
Ans-2 The rate of tax of the subject goods is at 2.5% CGST and 2.5% SGST as per entry S. No. 131 of Schedule I of Notification No. 1/2017-C.T. (Rate), dated 28-6-2017 as amended.
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2024 (10) TMI 1417
Unexplained investments/ amounts deposited in the foreign bank account - delay filing SLP - Whether no concrete evidence to establish either the ownership of the alleged bank account or the alleged disputed deposits in those accounts to be belonging to the assessee - HC decided [2023 (11) TMI 759 - PUNJAB AND HARYANA HIGH COURT] assessee being an agriculturist and only having a small holding of land apparently could not be in possession of such huge amounts, which were also in foreign currency. Nothing as such was produced on record that the same was transferred from India where he was doing some business. It is neither the case of the revenue that the amounts were credited from his income while doing business at abroad and neither he was based abroad for such long periods to generate that kind of income, thus decided against revenue.
HELD THAT:- There is gross delay of 233 days in filing this Special Leave Petition. The reasons assigned for seeking condonation of delay are neither satisfactory nor sufficient in law to be condoned.
Hence, the application seeking condonation of delay is dismissed. Consequently, the Special Leave Petition also stands dismissed.
Even otherwise, we find that the High Court has noted that no substantial question of law arose in the case.
In passing the aforesaid order, we have followed the earlier order of this Court in Joginder Singh Chatha [2024 (10) TMI 874 - SC ORDER]
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2024 (10) TMI 1416
Maintainability of appeal on low tax effect - Liability to pay interest u/s 234B - non payment of tax in respect of Assessment Year 2005-06 and 2006-07 - as decided by HC [2020 (9) TMI 873 - KARNATAKA HIGH COURT] legal position as it existed for the relevant Assessment Years prior to insertion of proviso to Section 209(1) of the Act, it is clear that if payer who was required to make payments to non resident had defaulted in deducting the tax at source from such payments, the non resident is not absolved from payment of taxes thereupon and non resident is liable to pay tax and the question of payment of advance tax would not arise.
HELD THAT:- The special leave is disposed of owing to low tax effect.Question of law, if any, is kept open.
Pending application(s), if any, shall stand disposed of.
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2024 (10) TMI 1415
Validity of Revision u/s 263 - substantial question of law or fact - there were discrepancies in the figure with regard to value of current assets and current liabilities shown in the balance sheet as on 31.03.2008 vis-à-vis the cash flow statement filed before the AO - as decided by HC [2023 (12) TMI 1364 - ORISSA HIGH COURT] CIT(A) has dismissed the appeal exparte. Appeal had been filed before the Tribunal and the Tribunal had exparte restored the issue back to the file of CIT(A). CIT(A) also dismissed the appeal for non-compliance. Tribunal in the interest of natural justice had restored the issue to the file of the CIT(A) so that the, assessee could be granted the opportunity to substantiate its case. This clearly shows that the assessee is not interested in showing the reconciliation but is attempting to use technical reasons to avoid the responsibility. This scathing remark from the ITAT showcases the triviality of the matter at hand.
Additionally, the submissions made with regard to the section 255 showcases the intention of the petitioner to delay the case.
HELD THAT:- Delay condoned. No case for interference is made out in exercise of our jurisdiction under Article 136 of the Constitution of India. The Special Leave Petition is accordingly dismissed.
Pending application, if any, also stands disposed of.
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2024 (10) TMI 1414
Recovery proceedings - Suo motu revision u/s 263 - Tribunal directed to make inquiries as directed by the Principal Commissioner of Income Tax regarding the correctness of the valuation report of the accountant - petitioner’s primary contention is that the directions of the Tribunal were not carried out in the order of assessment passed on remand; nor were the directions issued in the order u/s 263 complied with.
HELD THAT:- We are of the opinion that the recovery should await the disposal of the appeal especially since the demand raised is based on an assessment order, which was passed prior to the Tribunal’s order. As submitted that 20% of the amounts have already been recovered and hence, there would be no recovery carried out based on the assessment order at Annexure-3.
The appeal filed as submitted by petitioner. It is submitted by the learned counsel for the petitioner that amounts were recovered from the cash credit account and this created huge liability on the petitioner especially since the interest would run on the debit made. The petitioner, hence, seeks refund of the amounts already attached and recovered from the petitioner’s account. The petitioner also relies on judgment at Annexure-9 of another Division Bench of this Court.
Annexure-9 decision was in a batch of three writ petitions where attachment of the bank accounts of the assesses were made, when the assessment orders which created the demand were challenged in appeal after depositing 20% of the disputed tax amount under the Value Added Tax Act.
Identical to the case herein, the attachment order was made of a cash credit account, which is a credit facility offered to the customer by the bank subject to a limit; which even if not overdrawn to the limit, would still not have any money belonging to the assessee as distinguished from a credit balance in a current account. But therein the demand was not met, which was met in the present case; which detains us from directing a refund.
We make it clear that if the assessment is set aside, the assessee would be entitled to the refund along with interest payable as per the statute or that paid by the assessee in the cash credit account; whichever is higher and if not, the assessee would be saved from the interest on the amount recovered in the intervening period. There is no requirement to direct the assessee to be refunded the 20% already recovered. There shall be no further recovery based on the impugned assessment till the appeal is disposed of
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2024 (10) TMI 1413
Import of cylinders without a PESO certificate - non-compliance with Rules 31 and 32 of the Gas Cylinder Rules, 2016 - goods under the bill of entry confiscated under Section 111(d) of the Customs Act, 1962 - as argued reasons entirely attributable to the PESO Authorities, the Petitioner cannot be made to suffer either confiscation or Penalty -Respondents, pointed out that even if the incorrect PESO Certificate dated 25th April 2024 were to be regarded as valid, still, the goods, in this case, arrived on 16th April 2024 i.e. before the date of such certificate - redemption fine and the penalty imposed
HELD THAT:- Considering that in the present case, the value of the Cylinders is around Rs. 31 lakhs, we direct that the Cylinders be provsionally released subject to the Petitioner furnishing the usual bonds and paying the concerned Respondents an amount of Rs. 2,00,000/- without prejudice to the Petitioners rights and contentions that in the present case, no penalty or redemption fine is payable. All parties' contentions in the context of the Show Cause Notice issued are left open.
Petitioner states that the payment and other formalities will be completed by 30 October 2024. When this is done, the cylinders must be released immediately. We clarify that the payment of Rs. 2,00,000/- will abide by the conclusion in the adjudication of proceedings pursuant to the Show Cause Notice already issued.
ORDER - Seventh and Eighth Respondents are directed to provisionally release the Cylinders upon the Petitioner furnishing the usual bonds for paying an amount of Rs. 2,00,000/- without prejudice. Petitioner is granted the liberty to file reply to Show Cause notice by 30 October, 2024.
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2024 (10) TMI 1412
Show cause notice pending adjudication for the last 15 years - eligible reasons for inordinate and unexplained delay - HELD THAT:- In the present case, the delay between 2008 and 2021 is inordinate and, moreover, unexplained. The affidavit filed by the Respondent does not explain this inordinate delay. The Hon’ble Supreme Court’s order M/S SWATI MENTHOL AND ALLIED CHEMICALS LTD & ANR. [2023 (7) TMI 662 - SC ORDER] as noticed by the Co-ordinate Bench, does not make out the proposition that gross, unjustifiable and inordinate delay in adjudication of the show cause notice must, in every case, be excused regardless of the absence of any reasonable explanation.
Accordingly we quash and set aside the impugned show cause notice and restrain the Respondents from proceeding further based on it.
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2024 (10) TMI 1411
Duty Drawback claim - Impugned Order is challenged by the Petitioner primarily on the ground that the denial of Duty drawback long after the export were made and the benefits which were extended have been denied pursuant to Circular No.55/99-Cus dated 25.08.1999 - HELD THAT:- The order does not call for any interference. The issue has been examined by the Revisional Authority in the light of the decision of the Karnataka High Court in the case of CCE Bangalore Vs. Central Manufacturing Technology Institute [2001 (7) TMI 147 - HIGH COURT OF KARNATAKA AT BANGALORE], wherein, it has been held that clarificatory notifications are retrospective in nature. The petitioner was not entitled to drawback claim as the product exported by the petitioner was Woolen Readymade Garments. It has been clarified by CBEC Circular No.55/99 dated 25.08.1999 that S.S.NO.62.09 is applicable to only woollen Suits/Trousers/Blazers/Jackets, therefore woollen garments other than these categories are not covered by any of the S.S. Nos of Drawback Table and hence the exporters can only claim Brand Rate for the same.
This Writ Petition is dismissed.
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2024 (10) TMI 1410
Misdeclaration of imported polished marble slabs as unpolished slabs - as alleged that during physical verification, quantity of 51.85 Sqm (slabs) were found in excess - customs duty demanded along with interest and imposed on the importer and other co-noticees'
Importer admittedly paid total customs duty as prior to issue of show cause notice and after issue of show cause notice along with interest and 15% penalty and requested to close the proceedings in view of Section 28(5) and 28(6) of the Customs Act, 1962 - Commissioner instead of closing the proceedings under Section 28(5) and 28(6) of the Customs Act, held that show cause notice is pre-mature for demand of duty only, therefore proceedings cannot be closed.
Whether the assessment was provisional or final? - HELD THAT:- The adjudicating authority has clearly mentioned that not just release but assessment was also provisional under Section 18(2) of the Customs Act, 1962. The appellant requested to finalize the assessment quite a few times. All these requests to make the assessment final were made after provisional release. The letter dated 25.10.2018 is also available in case file at page number 198. The last line clearly mentions the request to finalize the Bill of Entry. Further, a letter dated 15.11.2018, submitted by the appellant to the Di, Gandhidham regional Unit is also available in case file at page number 201. This letter also requests to finalize the Bill of Entry. Therefore, as admitted by the appellant many times, the assessment of the Bills of Entry remained provisional. It was not just a provisional release but a provisional assessment also. The same fact has been recorded by the adjudicating authority in para 4.4 of the O-1-0. Though "Provisional Release" and "Provisional Assessment" are two independent concepts, in the instant case both are present.
Whether Section 28(4) is applicable at all? - The adjudicating authority has held that it would be premature to demand duty under Section 28(4) of the Act. This is in consonance with various judicial pronouncements and it is a settled law that Section 28(4) kicks in only after final assessment. As explained in para 2, assessment was provisional, and therefore, the proceedings have been rightly concluded under Section 125.
Provisions quoted in the Show Cause Notice - What is the recourse for adjudicating authority when assessment is provisional in case of provisional release? - Since the assessment was provisional, the proceedings were required to be concluded under Section 125 of the Customs Act after issuing a Show Cause Notice under Section 124. Various judicial pronouncements have held that when the assessment is not final, a Show Cause notice should be given under Section 124 of the Customs Act which as a corollary can be concluded under Section 125.
The instant case is squarely covered by case of DEEP JYOTI WAX TRADERS PVT. LTD [2014 (8) TMI 1055 - CALCUTTA HIGH COURT] since there is a mis-declaration of goods.
As per case M/S PUSHPAK LAKHANI VERSUS THE COMMISSIONER OF CUSTOMS (PREVENTIVE) – NEW DELHI [2022 (1) TMI 114 - CESTAT NEW DELHI] allowing provisional release does not interfere in adjudication process or with the jurisdiction of adjudicating authority. Jurisdiction of the adjudicating authority in the instant case under Section 125 cannot be questioned by any stretch of imagination and hence, the adjudicating authority has correctly adjudicated the issue under Section 125.
Mere mentioning of wrong provisions or not mentioning of it does not vitiate the proceedings till the time statutory authority has requisite authority therefore or not - mentioning Section 28(4) in the Show Cause Notice - Since order of dismissal of an army personnel was upheld despite the fact that wrong provision was quoted in the order of discharge but the authority had power, though in a different section, to dismiss him. In the instant case also, though wrong section Le. Section 28(4) has been quoted, authority of adjudicating authority cannot be questioned under Section 125 after the goods were seized and found liable for confiscation on account of mis-declaration. See RAM SUNDER RAM VERSUS UNION OF INDIA & ORS. [2007 (7) TMI 673 - SUPREME COURT]
Mentioning of a wrong provision ie. Section 28(4) and not mentioning of correct section i.e. Section 124 does not vitiate the proceedings till the adjudicating authority has the power to pass an order under Section 125 which is unquestionably present with the adjudicating authority. See MERINO PANEL PRODUCT LTD. [2022 (12) TMI 453 - SUPREME COURT]
Contention of the appellant is that since goods were released provisionally and were not available, redemption fine cannot be imposed - When the goods are released under bond, RF can be imposed under section 125 since RF is in lieu of confiscation of goods and not in lieu of goods. When the goods are liable for confiscation, RF should be imposed. See KAY BEE TAX SPIN LTD. [2017 (1) TMI 1223 - GUJARAT HIGH COURT]
Adjudicating authority has imposed a penalty u/s 112(a) of the Customs Act, 1962 whereas the Show Cause Notice proposes penalties u/s 112(a), 114(AA) and 117 of the Act - defect in the order can be considered as "omission" on the part of the adjudicating authority as adjudicating authority has erred by not imposing any penalty under Section 114(AA) - We find that it is not coming out clearly as to whether the goods were provisionally released or assessment were done provisionally as the former relates to seized goods and later in part of interim assessments required to be subjected to finalisation. In case demand under Section 28 (4) was applicable and duty was demandable then the party is very much entitled to claim the amnesty under Section 28 (5) and the same on following of the requisite conditions. In which case confiscation of goods and interest thereof does not get triggered nor any provisional assessment is required to be finalized to the prejudice of the party. We are therefore, remanding the matter back to the adjudicating authority to decide firstly nature of proceedings by determining the appropriate facts and if assessment was not provisional to allow benefit of provisions of Section 28(5) & 28 (6) to the party on fulfilment of the conditions or otherwise to finalise assessment first and then demand duty under Section 28 (4) and allow amnesty under Section 28 (5) and 28 (6) on fulfilment of conditions.
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2024 (10) TMI 1409
Intervention by Greenopolis Welfare Confederation in the proceedings - Role and actions of the Interim Resolution Professional (IRP) - HELD THAT:- Having heard the learned counsel for the parties and in order to safeguard the assets of the corporate debtor, for now, the IRP is allowed to take measures which are indicative above vide serial no. 1, 2, 3, 5, 6 and 12. In the consideration of this Court, such measures are necessary so as to safeguard the assets of the company and also the interest of the stakeholders.
Compliance cum updated status report be filed by the IRP on or before the next date of hearing - This application is disposed of.
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2024 (10) TMI 1408
Inclusion of outstanding lease rental and premium due from the date of CIRP commencement that is 26.11.2018 till the approval of the resolution plan i.e. 12.09.2022 in the CIRP costs - CIRP has been triggered and moratorium has been imposed - Section 5(13) of IBC - HELD THAT:- The Appellant has relied upon a decision of this Court in the case of Sunil Kumar Agrawal [2023 (1) TMI 552 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL , PRINCIPAL BENCH , NEW DELHI] in which a similar controversy was involved. In the said case, the application was filed under Section 60(5)(c) of the Code by GNIDA for a direction to the resolution professional to make the payment of the amount due and payable towards the outstanding dues which became due during the CIRP. The same was allowed by the Tribunal. It was argued by the Appellant in that case that the Adjudicating Authority has erred in applying explanation of Section 14(1)(d) for allowing the application because the said explanation is not applicable and thus the question was framed by this Court as to whether the explanation under Section 14(1)(d) of the Code for the purpose of directing the Appellant to pay the lease premium amount and the lease rent to the Respondent is applicable?. This court in the decided case has held that explanation is not applicable because the premium amount or lease rent is not part of Section 14(1)(d) which cannot be read as similar grant or right which has to be in respect of the license, permit, registration, quota, concession, clearance etc. but not with premium amount or lease rent.
The order passed in the case of Sunil Kumar Agarwal [2023 (1) TMI 552 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL , PRINCIPAL BENCH , NEW DELHI] applies to this case also even though the said decision has been challenged by the Noida by way of Civil Appeal No. 901 of 2023 before the Hon’ble Supreme Court in which notice has been issued but stay has not been granted.
It cannot but have to maintain the same order that has been passed in the case of Sunil Kumar Agrawal till a decision about its correctness is taken by the Hon’ble Supreme Court in Civil Appeal No. 901 of 2023.
The impugned order is set aside - Appeal allowed.
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2024 (10) TMI 1407
Approval of Resolution Plan - Applicability of Section 240A of the IBC to the Corporate Debtor registered as MSME - whether SRA was ineligible as per Section 29A (c) of the IBC, to submit the Resolution Plan in the CIRP of the Corporate Debtor? - HELD THAT:- The Adjudicating Authority has held that Birendra Kumar Pasari, who is Managing Director of the SRA is also the Promoter and in control and management of the CD, hence, he shall be deemed to be in management and control of the SRA. It was also noted and observed that Birendra Kumar Pasari and his family members are also in management and control of the Financial Creditor. After considering the RBI Circular dated 01.07.2015; clarification dated 12.11.2021; provisions of Section 29A and judgment of the Hon’ble Supreme Court in ARCELORMITTAL INDIA PRIVATE LIMITED VERSUS SATISH KUMAR GUPTA & ORS. [2018 (10) TMI 312 - SUPREME COURT], the Adjudicating Authority has come to the conclusion in paragraph 48 that account of CD having become Non-Performing asset on 14.06.2020, whose debt could not have been paid for a period of at least one year before commencement of CIRP, by virtue of Section 29A, the SRA becomes ineligible to submit the Resolution Plan.
The facts of the present case, clearly indicate that the Corporate Debtor was registered as MSME much prior to the submission of the Resolution Plan by Bishwanath Traders & Investment Ltd. Thus, the eligibility of SRA has to be seen on the date of submission of Resolution Plan. A perusal of the judgment of the Adjudicating Authority indicate that Adjudicating Authority has not adverted to Section 240A of the IBC and declared the SRA ineligible on the strength of Section 29A(c).
On looking into the scheme of Section 29A(c), which is relied by the Suspended Director, the scheme itself contemplate ineligibility on the ground that Resolution Applicant is a person under whose management or control the Corporate Debtor’s account has become non-performing. Thus, when Section 240A is applied, ineligibility in the Resolution Applicant, under whose management and control, the account of the CD was declared non-performing, cannot be reckoned. No other ineligibility of the SRA has been pointed out or pressed, SRA Bishwanath Traders & Investment Ltd. did not suffer from any ineligibility from submitting the Resolution Plan on 11.07.2022, on which date Plan was submitted. The Adjudicating Authority committed error in allowing IA No.4173 of 2023 filed by the Suspended Director and rejecting IA No.5458 of 2022 filed by the RP for approval of the Resolution Plan.
The order dated 24.01.2024 impugned in these Appeal(s) are set aside. IA No.4173 of 2023 is dismissed and IA No.5458 of 2022 is allowed, approving the Resolution Plan - appeal allowed.
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2024 (10) TMI 1406
Availability of statutory remedy under Section 8 of the Prevention of Money Laundering Act, 2002 - Refund of money deposited with interest - HELD THAT:- This Court has not gone into the merits of the claim, which shall be considered by the court concerned in accordance with law and in accordance with the merits of the case, without being influenced by any observation made by this Court in this order.
Certified copy of this order along with claims shall be filed before court concerned within ten days. The decision shall be taken by the court concerned on the claim in accordance with law and on the basis of material brought before the court by the petitioner in support of his claim.
The present writ petition stands disposed of.
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2024 (10) TMI 1405
Grant of regular bail - Money Laundering - proceeds of crime - scheduled offence - offence of cheating and criminal conspiracy - HELD THAT:- For consideration of the bail application under PMLA, 2002 the Court need not go deep inside the merits of the case but should consider the prima facie material against the accused in the case. The Hon’ble Supreme Court in the matter of Vijay Madanlal Chaudhary case [2022 (7) TMI 1316 - SUPREME COURT] has held that 'The Court will not weigh the evidence to find the guilt of the accused which is, of course, the work of Trial Court. The Court is only required to place its view based on probability on the basis of reasonable material collected during the investigation and the said view will not be taken into consideration by the Trial Court in recording its finding of the guilt or acquittal during trial which is based on the evidence adduced during the trial.'
In the case of Satish Jaggi Vs. State of Chhattisgarh [2007 (4) TMI 775 - SUPREME COURT], the Hon’ble Supreme Court has held that “at the stage of granting of bail, the Court can only go into the question of prima facie case established for granting bail, it cannot go into the question of credibility and reliability of witnesses put up by the prosecution. The question of credibility and reliability of prosecution witnesses can only be tested during trial.”
The criminal activity of opening bogus/benami bank accounts and utilizing them for illegal online betting therefore the illegal funds belonging to Mahadev Online Book being transferred through the bogus bank account is the proceeds of crime as defined under Section 2 (1) (u) of PMLA, 2002. The digital record seized in the case and from the statements recorded under Section 50 of the PMLA, 2002 clearly establishes the link of the present applicant with the illegal betting website Sky Exchange and the generation of proceeds of crime through it. In the statement of Prashant Bagari recorded under Section 50 of the PMLA, 2002, the involvement of the present applicant Nitin Tibrewal at the highest level of Sky Exchange clearly appeared which corroborates the statement Smt. Preeti Rathi and Kamal Kishore Rathi the present applicant Nitin Tibrewal was engaged in online betting through Sky Exchange.
On perusal of the material produced in the present case, it is not acceptable that the present applicant did not know about the transactions in either from Techpro IT Solutions or from other sources and owned a property at UAE. Denial by the accused itself is not sufficient to consider prima facie that there is no mens rea of the applicant for the said offence under the PMLA, 2002. Although the statement recorded under Section 50 of the PMLA, 2002 is required to be tested at the time of trial, for the purpose of consideration of bail application the statement recorded under Section 50 of the PMLA, 2002 can be considered against the applicant.
It cannot be said that there is no involvement of the applicant in the offence in question. Considering the role of the applicant in the ensuing money laundering case of proceeds of crime in Mahadev Book App, it is found that, there is sufficient evidence collected by the respondent-Enforcement Directorate to prima facie show the involvement of the applicant in the offence of money laundering as defined under Section 3 of the PMLA, 2002. It is an organized crime having various facets of its complexion, therefore, further considering the provisions of Section 45 of the PMLA, 2002 this Court is satisfied that there are reasonable grounds for believing that the applicant is involved in the offence and he is likely to commit any other offence while on bail, it is not required to grant bail to the applicant.
The present bail application filed by the applicant Nitin Tibrewal is rejected.
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2024 (10) TMI 1404
Interpretation of statute - Rule 4(7) and Rule 11 of Cenvat Credit Rules - Applicability of Rule 6 of Cenvat Credit Rules in recovering cenvat credit for unsold carpet area - HELD THAT:- The appellant had availed cenvat credit of service tax paid on input services when the output service was subjected to levy of service tax. It is, therefore, found that availment of cenvat credit was in accordance with law. It is also noted from the proceedings that before receipt of Occupancy Certificate on 22.01.2016 appellant had utilized the entire cenvat credit of Rs.2,51,02,850/- towards payment of service tax on output service.
Service Tax Law does not provide for levy of service tax on the flats or buildings constructed for which Occupancy Certificate is obtained. Therefore, carpet area of 21,010 square feet constructed by the appellant was not liable to levy of service tax. Revenue has invoked Rule 6 of Cenvat Credit Rules which provides for circumstances where cenvat credit is admissible or not admissible depending on taxability or otherwise of output service.
It is clear from the ruling by Hon’ble Gujarat High Court in the case of Principal Commissioner vs. Alembic Ltd. [2019 (7) TMI 908 - GUJARAT HIGH COURT] that after obtaining Occupancy Certificate in respect of unsold carpet area for which no service tax will be leviable, cenvat credit already availed when the activity was taxable, the said cenvat credit need not be recovered.
Thus, the appellant was not required to pay back the amount equivalent to cenvat credit of Rs.25,03,849/- - the impugned order is set aside - appeal allowed.
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2024 (10) TMI 1403
Non discharge of service tax - invocation of the extended period or the demand of service tax - Penalties imposed u/s 77 and 78 of the Finance Act, 1994 - appellant was providing taxable services under the category of Maintenance & Repair Service, Man Power Recruitment & Supply Agency Service to the service recipient
HELD THAT:- Both the authorities below have misdirected themselves as there was no contest by the appellant to the invocation of the extended period or the demand of service tax. Appellant has suo motto computed the service tax due and has paid the said amount. As pleaded his lack of knowledge and status as petty contractor not having means to understand the complexity of taxation of services. Both the authority agree to these submissions and have still gone on to impose heavy penalties u/s 77 and 78 of the Finance Act, 1994.
Taking note of undisputed findings with regards to status of appellant and his compliance even before the adjudication has been undertaken we do not find any justification for not having considered extending the benefit of Section 80 of the Finance Act, 1994 and waiving of all the penalties imposable on the appellant.
We do not find any merits in the impugned order to the extent it is in relation to the penalties imposed on the appellant. This is a fit case where penalties imposable under Section 77 and 78 should have been waived in terms of provisions of Section 80 of the Finance Act, 1994.
Appeal partly allowed to the extent of setting aside the penalties imposed on the appellant.
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2024 (10) TMI 1402
Non discharge of service tax - Appellant was providing taxable services under the category of Maintenance & Repair Service, Man Power Recruitment Agency Service & Construction (Commercial & Industrial) Services to the service recipient - Demand of service tax + Education Cess + Secondary & Higher Education Cess - HELD THAT:- As the appellant was well aware that he was providing taxable services and short paid the service tax, even after issuing invoices indicating the services tax payable and collecting the same from the service recipient. They were not filing the ST-3 returns on time in the manner as specified in law. They have suppressed the information with intend to evade payment of taxes. Accordingly, the demand by invoking the extended period of limitation and penalty imposed cannot be disputed with.
As decided in Afsar Tour and Travels [2018 (8) TMI 1281 - CESTAT HYDERABAD] leviable of service tax does not change that whether or not they have collected same from their clients. We cannot accept a new ground of liability of service tax at this stage, proposed by the Learned Counsel for the appellant because there was never a point of contention at the time of Order-in-Original or Order-in-Appeal. We therefore, find the Learned Lower Authority was correct and confirmed the demands along with interest and imposing penalties. Appeal dismissed.
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2024 (10) TMI 1401
Failure to pay the service tax on the full amount of consideration received - services of construction of complex service - disputed period is from 01/2008 to 08/2010 - HELD THAT:- Attention invited to an order of this bench in the case of M/s. Shanti builders wherein this bench vide Final Order No. 40257/2023 dated 06.04.2023 [2023 (4) TMI 350 - CESTAT CHENNAI] has held that no service tax could be levied under construction of residential complex services prior to 01.07.2010.
The confirmation of the demand of Service Tax cannot sustain, nor could there be any scope to impose penalties under Sections 77 & 78 of the Financial Act, 1994. Therefore, the impugned order which has upheld the demands deserves to be set aside - appeal allowed.
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2024 (10) TMI 1400
Service Tax Exemption under Notification No. 25/2012-ST denied - Demand of Service Tax along with interest and imposed penalty - amount on providing services of laying of cable, under or alongside road, under NOFN project - as per Respondent amount was neither shown by the appellant in their ST-3 returns nor had any service tax been paid by them on such services provided by them to M/s BSNL (BBNL) - appellant submitted that the appellant had rendered services to BBNL/BSNL towards execution of the NOFN project, which are exempt from service tax by virtue of Sl. No. 12 of Notification No. 25/2012-ST dated 20.6.2012
Whether the appellant is eligible for the exemption under Notification 25/2012-ST dated 20.06.2012? - Even though BSNL is wholly owned by the Government, but it is a State-run Telecom company, whose primary objective is to increase sales revenue with focus on subscriber retention & acquisition by way of strengthening marketing, quality of service and customer delivery. Consequently, any activity undertaken for BSNL would also be for the same purpose, viz., expanding its subscriber base and increase revenues. Therefore, it cannot be said that the NOFN project (now known as Bharat Net project) aimed at bringing broadband connectivity to the Gram Panchayats was only towards planning for economic and social development. Such network was laid in recognition of the fact that expansion was important to increase their subscriber base, thus providing an opportunity to increase their revenues. Hence, the activity undertaken by the appellant is for use for commerce.
The term ‘Commerce’ as understood by layman refers to the activity of buying and selling goods and services, between businesses or individuals, and can occur domestically or internationally. Commerce is a key component of the economy, encompassing various activities such as trade, logistics, advertising, customer interactions, & also includes different channels like traditional retail, online transactions (e-commerce), and wholesale trade etc.
As in Lilavati Kirtilal Mehta Medical Trust v. Unique Shanti Developers [2019 (11) TMI 1824 - SUPREME COURT] held that a straight-jacket formula cannot be adopted in every case and the broad principles which can be curled out for determining whether an activity or transaction is for a commercial purpose would depend on facts and circumstances of each case. In the instant case, it stands established that the appellant undertook the activity of laying cables for M/s BSNL, which was for the purpose of providing broadband connectivity was for connecting the areas of India for the purpose of increasing their business, sales revenue which would clearly fall within the ambit of commerce.
Scope of Notification no. 25/2012-ST dated 20.06.2012 - We note the Notification exempts a civil structure or any other original works meant predominantly for use other than for commerce, industry, or any other business or profession. The term used in the said notification is that ‘other than commerce, industry or any other business or profession’, which is required to be interpreted strictly, as held consistently by the Hon’ble Supreme Court. Exemption notification should not be liberally construed and the beneficiary must fall within the ambit of the exemption and fulfill the conditions thereof. In case such conditions are not fulfilled, the issue of application of the notification does not arise at all by implication. We hold that the appellant is not entitled to the benefit of the Notification no. 25/2012-ST dated 20.06.2012. We find no infirmity in the impugned order.
Eligibility of benefit of cum-duty - It is seen from the show cause notice that the appellant had vide their letter submitted that neither had they collected/received the service tax from M/s BSNL(BBNL) on account of providing the service of laying cable, under or along side the road under NOFN project or did they deposit any service tax. In this context, we note non-recovery of service tax is an offence under Sec 73 of the Act.
Tribunal in M/s Panther Detective Services V. Commissioner of Central Excise, Kanpur [2006 (7) TMI 15 - CESTAT, NEW DELHI] held that the only relief in regard to valuation that the appellants would be entitled to treat the total receipts as inclusive of service tax. It was accordingly ordered that the Revenue shall recompute the tax amount in these appeals treating the total receipts as cum-tax.
We also take note of the Supreme Court’s decision in the case of Commissioner of Central Excise V. Maruti Udyog Ltd. [2002 (2) TMI 101 - SUPREME COURT] wherein the Court granted the cum-duty benefits to the assessee. The Hon’ble Court noted that the service tax is on the value of taxable services rendered and therefore service tax has to be collected on that value only and the value of taxable services cannot be said to include the tax also. The Court went on to note that the Finance Act, 2006 inserted clause 2 to Sec. 67 with effect from 18.04.2006 provides that where the gross amount charged by a service provider, for the service provided or to be provided is inclusive of service tax payable, the value of such taxable service shall be such amount as with the addition of tax payable, is equal to the gross amount charged.
We find it appropriate to remand the matter to the original authority for recalculation of the demand extending the benefit of cum-tax on the gross amount charged by the appellant. Accordingly, the penalty under section 78 would be appropriately recalculated, based on the demand.
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2024 (10) TMI 1399
CENVAT Credit in respect of ‘input services’ as well as on capital goods on the basis of advisory notes - Invocation of the extended period of limitation under the Finance Act - As alleged audit noticed that BSNL had mainly availed CENVAT Credit on towers falling under Chapter 73 of the Central Excise Tariff, which would not be covered under the definition of the ‘capital goods’ as defined under rule 2(a) of CENVAT Credit Rules, 2004 - HELD THAT:- The show cause notice alleges that BSNL had availed CENVAT credit on tower materials. Neither the show cause notice nor Annexure-A to the show cause notice, except for a bald allegation, substantiate that BSNL had actually availed CENVAT credit on tower materials. Annexure-A to the show cause notice takes into consideration all the CENVAT credit availed on duty paid by BSNL. Annexure-A does not show that BSNL had actually availed CENVAT credit on duty paid for tower materials. The Commissioner completely failed to notice this part of the reply submitted by BSNL and merely proceeded to decide whether credit could have been taken by BSNL on the duty paid for tower materials.
The issue as to whether CENVAT Credit could have been availed by BSNL on duty paid for tower materials has now been settled by the Tribunal in M/s GMTD Bharat Sanchar Nigam Limited [2024 (8) TMI 785 - CESTAT NEW DELHI] after taking into consideration various decisions, held that BSNL could avail CENVAT credit on duty paid for tower materials.
Such being the position there is no error in the finding recorded by the Commissioner that BSNL could have availed CENVAT credit on duty paid for tower materials.
Whether the extended period of limitation could have been invoked in the facts and circumstances of the case? - A perusal of the show cause notice indicates that there is a bald allegation relating to suppression of facts but there is no allegation that facts were suppressed with an intent to evade payment of service tax.
The extended period of limitation under the proviso to section 73 (i) of the Finance Act, therefore, could not have been invoked. See Sunshine Steel Industries [2023 (1) TMI 638 - CESTAT NEW DELHI]
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