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2019 (4) TMI 1716
Remission of sales tax arrears with interest thereon of the former owner of the immovable property currently owned by the Petitioner - enforceable charge of the property - Section 100 of the Transfer of Property Act, 1882 - HELD THAT:- From a perusal of Section 100 of the TPA, it is clear that, unless expressly provided otherwise by any law for the time being in force, unlike a mortgage, a charge can be enforced against the property in the hands of a transferee only if the transferee had notice of the prior charge and was not a bona fide purchaser. In the instant case, the learned counsel for the Respondent admitted that the Sub- Registrar concerned was not informed about the existence of the charge in favour of the Respondent. It is also clear from the encumbrance certificate, which was obtained by the Petitioner in December 1998, that no charge was reflected in respect of the said property up to December 1998.
The allegation that the Petitioner and the erstwhile owner colluded in effecting the sale is not based on actionable evidence and such an inference cannot be countenanced purely on the basis that the parties concerned reside in the same area or even because the original title deeds were missing as per the public notice. Therefore, it cannot be said that the Petitioner had prior notice, either actual or constructive, of the existing charge.
Whether Section 24-A of the TNGST Act contains a stipulation that the charge can be enforced even against a transferee without notice? - HELD THAT:- From the language of Section 24(2), it is clear that a statutory charge is created in favour of the sales tax department upon failure to pay sales tax within 21 days of the date of receipt of a notice of assessment. Therefore, from the counter affidavit, it appears that a statutory charge was created over the property on or about 31.06.1996. More importantly, when the language of Section 24-A is examined, there is nothing therein that suggests that the statutory charge would be enforceable against a transferee without notice.
There is no evidence that there was collusion between the Petitioner and the erstwhile owner. Equally, from the documents on record, the Petitioner appears to be a bona fide purchaser without notice, either actual or constructive, of the prior charge in favour of the Respondent.
Petition allowed.
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2019 (4) TMI 1715
Profiteering - BWP Trozan Platinum Ply 19 mm 2.44x1.22 - benefit of reduction in the rate of GST - contravention of the provisions of Section 171 of CGST Act, 2017 - HELD THAT:- It is apparent from the perusal of the facts of the case that there was a decrease in the per unit base price (excluding GST) of the product in the post-GST era as compared to the pre-GST era when the applicable tax was reduced from 28.81% to 28%, when GST was implemented w.e.f. 01.07.2017. Further, the base price of the product was ₹ 1028.07 per square meter in the invoice dated 24.05.2017 and the price of the product was reduced to ₹ 1021.73 in the invoice dated 09.08.2017 after giving a discount of 17.05% on the base price of ₹ 1231/- per square meter (discount of ₹ 90,572/- was given on the total invoice value of ₹ 5,31,125.41 @ 17.05%). Further, the price of the product also remained at ₹ 1021.73 in the invoice dated 02.12.2017 after giving a discount of 17.05% on the base price of ₹ 1231/- per square meter (discount of ₹ 6249/- was given on the total invoice value of ₹ 36,646.87 @ 17.05%).
It is apparent that the Respondent did not increase the per unit base price (excluding GST) of the product, which was ₹ 1028.07 in the pre-GST era. Further, it was reduced to ₹ 1021.73 in the post-GST era w.e.f. 01.07.2017 and it also remained at ₹ 1021.73 when the GST rate was reduced from 28% to 18% w.e.f. 15.11.2017 and hence, there was no increase in the per unit base price. Therefore, the allegation of profiteering is not sustainable in terms of Section 171 of the CGST Act, 2017.
Application dismissed.
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2019 (4) TMI 1714
Freezing of Bank Accounts - bogus addresses for the purposes of claiming IGST refunds - HELD THAT:- The issue is decided in the case of S.B. INTERNATIONAL VERSUS THE ASSISTANT DIRECTOR, DIRECTORATE OF REVENUE INTELLIGENCE AND ORS. [2018 (2) TMI 588 - DELHI HIGH COURT], where after considering the provisions of the Customs Act and other similar enactments, it was held that the power to freeze or suspend operations of a bank account cannot legally be exercised.
Petition allowed.
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2019 (4) TMI 1713
Revocation of CHA License - forfeiture of security deposit - time limitation - specific case made out by the writ petitioner is that the notice issued in the present case dated 13.08.2018 under Regulation 20 is beyond the period of ninety days as stipulated statutorily and is liable to be quashed - HELD THAT:- The issue as to whether the 90 day time limit for issuance of notice for revocation of licence under Regulation 20 (1) is mandatory or directory is no longer res integra. There are a series of decisions of the courts that have decided the same holding it to be mandatory. The revenue does not dispute this position either. However, learned counsel urges that in the facts of this case, the period be computed excluding the period when the order of suspension passed under Regulation 19 was stayed by this court.
The period when the interim order was in force, 24.08.2017 to 27.07.2018, to be excluded from the period of 90 days from date of receipt of offence report for issuence of notice under Regulation 20(1). The impugned notice has been issued on 13.08.2018 - In the present case, though there was an order of stay passed on 24.04.2018 by this court, there was nothing that prevented the respondent from issuing the show cause notice under Regulation 20 (i) of the CBLR, 2013, within the period of 90 days since the aforementioned period commences from the date of offence report, which, in this case, is 27.02.2018. The Regulation stipulates a seamless procedure commencing from the date of offence report and there is nothing in the regulation that indicates distortion of this time frame by intervening events.
Where a provision/regulation spells out a specific period of limitation, such period is mandatory and any exclusion there from should also be provided for specifically.
Petition allowed.
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2019 (4) TMI 1712
Refund of SAD - Denial on the ground that they have paid VAT / CST on such imported goods - N/N. 102/2007-CUS dated 14.9.2007 - HELD THAT:- The notification in question provides for exemption/refund of SAD if the imported goods are subsequently sold and they have suffered VAT/ CST - the provision of one statute i.e. Project Regulations cannot be imported into the provisions of Notification No. 102/2007-Cus to interpret and deny the exemption/ refund of SAD. Once the assessee has paid CST/ VAT on sale of imported goods, there is no question of retaining the 4% SAD as the payment of such CST/ VAT is the only criteria for granting refund. The adjudicating and the Appellate authority have found from the records that the imported goods on which SAD was paid have been sold by the Respondent to their buyer on further payment of VAT/CST and in such case, there is no reason to deny refund on the ground that the goods were part of Project contract and has lost their identity.
Unjust enrichment - The Revenue has argued that the price indicated in the purchase order is inclusive of all taxes & duties and the respondent has passed on the incidence of VAT to the buyer and there has been unjust enrichment - HELD THAT:- The unjust enrichment in the instant case would apply only if the Respondents would have passed the incidence of 4% SAD paid by them and not the element of VAT levied and recovered by the importer from their buyer as part of their subsequent sale of such goods. Para 2 (vii) of Circular 16/2008 issued by the Board clear states that the intention of the Government is not to allow the importer to recover 4% SAD from the buyer and to claim the refund from Customs as well and that the only method to ensure this is to make it conditional to satisfy the principal of unjust enrichment.
The recovery of VAT by the Respondent on subsequent sale does not casts any effect on exemption from SAD as the unjust enrichment would apply only if the Claimant recovers the SAD amount from buyers. The Appellate Authority has also examined the issue as to whether the Respondent has passed on the SAD Component to their buyer whether it pertains to passing on SAD component to the buyers. He has observed that none of the sales invoices were issued by the Respondent under rule 11 of the Central Excise Rules to enable the buyer to avail cenvat credit nor the invoices indicate the SAD component separately as available credit.
Appeal dismissed - decided against Revenue.
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2019 (4) TMI 1711
Benefit under Notification No. 93/2004-Cus. - import of relevant synthetic cloth for manufacture and export of synthetic slippers/ sandals with PU sole under SION norms A3541 - Revenue is of the view that the goods are classifiable under Chapter heading 39204900 as against the heading 59031090 mentioned in the license - HELD THAT:- The classification of goods specified in SION norms is not relevant unless it is specifically mentioned in the SION norms. The committee at Ministry of Commerce has also clarified that any change in the ITC (HS) Code has no bearing on the benefits to be given under advance authorization issued under Para 4.7 of HBP.
In the instant case the committee has clarified that any change in the ITC (HS) Code has no bearing on the benefits to be given under advance authorization issued under Para 4.7 of HBP. In this circumstance, the amendment made to the license will have a retrospective effect and the benefit of the notification cannot be denied on the ground that the classification of the goods did not match the classification specified in the advance license as long as the description of the goods matches with that prescribed in the license.
Appeal allowed - decided in favor of appellant.
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2019 (4) TMI 1710
Refund claim - denial of refund on the ground that without challenging assessment order on the shipping bill - HELD THAT:- In KARNATAKA POWER CORPORATION LTD. VERSUS COMMR. OF CUS. (APPEALS) , CHENNAI [2002 (4) TMI 79 - SUPREME COURT OF INDIA] and AMAN MEDICAL PRODUCTS LTD. VERSUS COMMISSIONER OF CUSTOMS, DELHI [2009 (9) TMI 41 - DELHI HIGH COURT] it has been held that filing of refund claim itself is a challenge of the assessment order, and the legitimate right of refund cannot be ignored - Thus, non-challenging of the assessment order is not a ground to deny the refund of duty wrongly collected and therefore, the decision of the Commissioner (Appeals) on this issue requires no interference.
Time limitation - HELD THAT:- It is seen that the Commissioner (Appeals) has referred to Section 16 & Section 51 of the Customs Act to arrive at the conclusion that the relevant date for reckoning the rate of duty to be paid is the date of let export order. Further, it is seen that the enhanced duty was paid by the respondent after issuing letter of protest. Therefore, limitation does not apply even if it is considered as subsequent claim - the refund claim then cannot be said to be time barred.
Appeal dismissed - decided against Revenue.
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2019 (4) TMI 1709
Benefit of Duty Entitlement Pass Book (DEPB) scheme in the Foreign Trade Policy - overvaluation - Confiscation - penalty - HELD THAT:- The applicability of resort to appraisal of value can arise only within the context of deviation from section 14(1) of Customs Act, 1962 and rules for valuation of exports was not in existence during the relevant period. There is no evidence on record to show that the appellant had not been in receipt of the amount transacted for the goods which could, then, have had a bearing on redetermining of transaction value. Reliance placed on ascertainment from local market does not in any way concord with the requirements of section 14 of Customs Act, 1962 which benchmarks time and place of exportation as critical to acceptance of a value.
The scrip does not conform any privilege; it prescribes a ceiling of eligibility for duty free import that is within the exclusive jurisdiction of the licensing authority. It is the utilisation of the scrip that triggers exemption from duty and, to the extent of ineligibility, arising from overvaluation of exports, can be proceeded against for recovery of the duty unpaid in consequence under section 28 of Customs Act, 1962 - In the absence of such proceedings, a bland order of recovery is without legal authority as it does not have sanctity of law.
Confiscation of goods under section 113(1) of Customs Act, 1962 follows from misdeclaration of value. While the market value of the impugned goods appear to have been ascertained, it cannot, by any stretch of law, be adopted for the purpose of assessment under section 14 of Customs Act, 1962 - Valuation upheld.
The penalty that was imposed on M/s Narendra Industries would also fail in the absence of finding of confiscability.
Appeal allowed.
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2019 (4) TMI 1708
Maintainability of appeal - monetary amount involved in he appeal - HELD THAT:- The disputed duty involved in this case is below the monetary limit of ₹ 10 lakhs which has been notified by the Government vide Circular No.390/Misc./163/2010-JC(17-12-2015) dated 17th December, 2015 and F.NO.390/Misc./116/2017-JC dated 04.04.2018 - the appeal is dismissed under National Litigation Policy.
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2019 (4) TMI 1707
Rectification of mistake - Typographical error - HELD THAT:- The error is only a typographical one inasmuch as in para 12, this Bench in line No. 4 has quoted “shipping bill No. 0982519, dated 03.12.2008” which according to the application filed should be “shipping bill No. 145/08-09, dated 03.12.2008”. On perusal of records, we find that shipping bill No. 145/08-09 was only in litigation before the lower authorities. There seems to be a typographical error in the above final order.
The error is now rectified - application for ROM allowed.
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2019 (4) TMI 1706
Benefit of N/N. 62/2007-Cus - iron ore fines of Fe content - denial of benefit on the ground that iron content is 62.31% - principles of natural justice - HELD THAT:- There is no definite conclusion can be arrived at regarding the Fe content of the iron ore fines which were exported. There is no evidence to show that either of the two reports is wrong. There is also no third report to substantiate either of the two reports. Re-testing is impossible because there is no sample left.
No definite conclusion can be arrived at regarding the iron ore content of the iron ore fine which were exported. Therefore, no definite conclusion can be arrived to decide whether or not the appellant is entitled to the benefit of the exemption benefit of notification No. 62/2007-Cus, dt. 03.05.2007. Since the exemption notification is a general rule, any benefit of doubt must be held against the appellant and in favour of Revenue.
Appeal allowed - decided in favor of Revenue.
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2019 (4) TMI 1705
Condonation of delay in filing the application for rectification of mistake - HELD THAT:- The application for condonation of delay is not mentioning any specific reason for filing the rectification of mistake application belatedly though it blandly says that the order was received by the security personnel and was not handed over to the responsible person in the office. The delay is condoned and the application for rectification of mistake is taken up.
Rectification of mistake - error apparent on the face of record or not - HELD THAT:- There is no error apparent on the face of record - the application for rectification of mistake stands dismissed.
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2019 (4) TMI 1704
Import of goods - whether the appellant has imported HSD or MGO? - HELD THAT:- It is an accepted principle that “he who asserts must prove” and the department asserts in this case that the product is HSD and not MGO but has failed to prove so. The imported fuel deserves to be classified as MGO as claimed by the appellant and duty charged appropriately as the test report by the chemical examiner has not tested all the parameters which are required to classify the same as HSD and has also not indicated that the material is not MGO.
Appeal allowed - decided in favor of appellant.
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2019 (4) TMI 1703
Import of ‘Dawson Weak Coking coal’ - Benefit of Sl. No. 68 of the Notification No. 21/2002-Cus, dated 01.03.2002 - HELD THAT:- There was no statutory definition of what is a coking coal in the notification during the relevant period. During subsequent periods, the principal selling index has been tested as a parameter and for some time CSN ‘1’ and at other item CSN ‘2’ was prescribed. Since there was no parameter fixed during the relevant period, the entitlement of the exemption would solely depend whether it had less than 12% ash content and is known in the trade as coking coal.
There is overwhelming evidence that the coal in question was imported and used as coking coal and it has a CSN of ‘4’ (according to the load port survey) or 1.5 (according to the CRCL report). At any rate, this cannot be held to be not coking coal.
The appellant is entitled to the benefit of Exemption Notification No. 21/2002-Cus, dated 01.03.2002 in respect of the coking coal imported by them - appeal allowed - decided in favor of appellant.
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2019 (4) TMI 1702
Provisional release of goods - Section 110(1) of the customs Act, 1962 - Seizure of goods on the belief that the goods have been imported in contravention of the SAFTA Provisions - HELD THAT:- From the certificates accompanying the consignment, it is noted that the value addition norms have been certified by the Export Promotion Bureau of Bangladesh. The Export Promotion Bureau of Bangladesh has also issued certificates dated 30/10/2018 and 01/11/2018 signed by its Director covering the seven consignments.
The benefit claimed has been supported by the necessary certificate; however, we take note of the fact that the Directorate of Revenue Intelligence has seized the goods covered in these consignments and are in the process of carrying out further investigations. Goods being of perishable nature, are required to be Provisional released in terms of Section 110A ibid.
The Transaction value declared in the Bills of Entry is much higher. The amount of bond may be determined on the basis of tariff values at the relevant time.
Bank guarantee/Security in addition to bond for provisional release - HELD THAT:- The imported consignments have been accompanied by the necessary documents. Nothing on record indicates that the investigating Agency is considering such documents as forged or otherwise suspicious. If the benefit of the Notification is granted, no duty would be payable.
The ends of justice will be met by execution of bond for 100% value of goods (determined on the basis of tariff value) with Bank guarantee for an amount of 20% of the applicable duties based on Tariff value.
Appeal disposed off.
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2019 (4) TMI 1701
Scheme of Merger - HELD THAT:- No objection to the proposed Scheme as per Rule 8 of the Companies (Compromises, Arrangements and Amalgamations) Rules, 2016. Approval of arrangement seeked. Adherence to mandatory convening of meetings Equity Shareholders of the Applicant Companies - Chairpersons appointed for the aforesaid Meeting to issue the notices of the Meeting referred to above - quorum for the aforesaid meeting of the Equity Shareholders shall be as prescribed under Section 103 of the Companies Act, 2013.
Scheme is an arrangement between the Applicant Company No.1 and their respective shareholders only a meeting of the Equity Shareholders is proposed to be held in accordance with the provisions of Section 230 (1) (b) of the Companies Act, 2013. This bench hereby directs the Applicant Company No.3 to issue notice to its Unsecured Creditor as required under section 230 (3) of the Companies Act, 2013 with a direction that they may submit their representations, if any, to the Tribunal and copy of such representations shall simultaneously be served upon the Applicant Company No.1.
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2019 (4) TMI 1700
Conversion of a public company into a private company - Change of status of company - seeking approval of this Tribunal to the conversion by altering the Memorandum and Articles of Association of the Company, as sought to be effected by a Special Resolution passed at the Extra Ordinary General Meeting - HELD THAT:- Board of Directors of the Company has passed a resolution in the meeting held on 20-12-2016 approving the conversion to Private Limited Company. A Special Resolution has also been passed on 21-01-2017 with the unanimous approval of the shareholders of the Petitioner Company. The said Special Resolution passed at the EOGM on 21-01-2017, has been filed by the company through e-form MGT-14, which has been approved. The Company is stated to be an unlisted public company. Neither the Registrar of Companies, West Bengal nor any member or creditor of the Company has any objection to the proposed conversion from Public Limited to Private Limited.
Since all the requisite statutory compliances have been fulfilled, the conversion of the status of the company from “Public Limited” to “Private Limited” as per Special Resolution passed at the AGM on 21-01-2017 is hereby approved in the interest of the company and such change of status of the company shall not cause any prejudice either to the members or the creditors or any other related party of the petitioner company. The Petitioner shall, however, remain bound to comply with the statutory requirements in accordance with law.
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2019 (4) TMI 1699
Refund of excess service tax paid by mistake - time limitation - HELD THAT:- In the present case the appellant by mistake has paid excess service tax and on realizing his mistake he filed a refund claim and thereafter a show-cause notice was issued to reject the refund claim on the ground of non submission of the documents. Further the appellant furnished all the required documents which were considered by the original authority and after considering the documents sanctioned the refund claim of ₹ 3,17,984/- in respect of the excess service tax paid on GTA during month of May 2014 under Section 11B of the Central Excise Act 1944 read with Section 83 of the Finance Act.
Appeal allowed - decided in favor of appellant.
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2019 (4) TMI 1698
Non-payment of service tax - service tax collected but not paid to Revenue - Interior Decorator Service - period 01.04.2003 to 28.02.2008 - HELD THAT:- It is not clear that whether the appellant has recorded income under the head of design and consultancy income under these agreements or others. It is apparent that these two contracts submitted along with the appeal are not represent contract in that sense. It is therefore, necessary that all contract and account entries made by the appellant need to be examined before going to the final conclusion regarding liability to service tax under the head of interior decorator service.
In the present case, it is apparent that in the said case did not involve any advisory consultancy or technical assistance. Thus it is apparent that the verification of the facts from the agreement is necessary before any decision on the issue is reached - the matter needs to be remanded to original adjudicating authority for examination of contract.
Management, Maintenance and Repair Service - period 16.05.2006 to 28.02.2008 - HELD THAT:- Appellant relies on the decision of Tribunal in the case of COMMISSIONER OF CENTRAL EXCISE, JAIPUR-I VERSUS ANS CONSTRUCTIONS LTD. [2009 (6) TMI 465 - CESTAT, NEW DELHI]. It is seen that the period involved in the said case was 16.06.2005 to 28.02.2006, which is period prior to amendment in definition of Management of Maintenance and Repair Service. Prior to 01.05.2006 the said service was only applicable when provided in respect of immovable property, however, w.e.f 01.05.2006, the said service also become taxable when provide in respect of property other than immovable property. The decision in the case of ANS Construction was based on the ground that the grass and plants etc. being maintained by the appellant were not immovable property and thus not liable to tax under the definition of Maintenance, Management and Repair Service, as defined in 16.06.2005 - the decision would not be applicable for the period after amendment w.e.f 01.06.2006.
Time limitation - HELD THAT:- The appellant were paying the service tax on their own for certain period and later stop paying. They have also collected the service tax and not paid to the government tragedy in certain case. In these circumstances, the benefit of limitation cannot be extended to the appellant as the appellant were obviously aware of the law - penalty set aside.
Appeal allowed by way of remand.
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2019 (4) TMI 1697
Business Auxiliary Service - appellant had collected commission and had accounted ₹ 33,08,870/- as agency commission for the period April 2008 to February 2009 from its group Companies for marketing of products - HELD THAT:- It is difficult to accept as to how the character of ‘Agency commission’ changes when it comes to service tax, on its own, without there being any documentary evidence, much less basic documents, furnished. If not agency commission, then the discount which is normally given to the buyer/end user, but the same is enjoyed by an intermediary/appellant. Books reflect it as agency commission but the appellant claims it, contrary to that, as discount. The same has been offered and has accordingly suffered income tax. In the absence of explicit supporting documents, even we find it difficult to dethrone the findings of Ld. Commissioner.
Substantial difference between the taxable value declared in the ST-3 return and the service income shown in the profit & loss Account - HELD THAT:- The appellant while accepting the difference, has taken the stand that the alleged difference was because of the reason that it was maintaining a consolidated/common balance sheet for all its three units, they had undertaken software development, appellant’s unit had recorded the payment of labour charges, that it was showing only income even though the same was not received during the year as it was following accrual system, etc. but it is even surprising to note that the appellant has tested the Commissioner also, by not bothering to produce any documents - we are compelled to accept the findings of Ld. Commissioner who has given a thread-bear analysis based on the best of his judgment due to the non-co-operation of the appellant - impugned order upheld.
CENVAT Credit - duty paying documents - appellant did not produce any documents based on which they had taken cenvat credit for the period October 2004 to March 2008 - Rule 9 of Cenvat Credit Rules, 2004 - We are remitting this issue to the file of adjudicating authority to pass de-novo order after affording reasonable opportunities to the appellant.
Extended period of limitation - HELD THAT:- There is no ground to interfere with the findings of the lower authority, the appellant could not produce basic documents in time, during audit, etc., that prompted SCNs which is in order. The revenue collated details after audit and issued the notices after analyzing the same and it is not the case that the appellant volunteered to offer explanation in between, when the fact of its non-production of documents was very much on board - invocation of extended period upheld.
Appeal disposed off.
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