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Showing 61 to 80 of 435352 Records

• 2025 (7) TMI 213
  

  Classification of services - Renting of Immovable Property service or not - screening/exhibiting the films in the theatre - HELD THAT:- Considering the agreement between the appellant with M/s. UTV, it is apparent from Clause 1 that the distributor grants Theatrical Exhibition Rights of the film to the appellant which implies that Theatrical Exhibition Rights are transferred by the distributor to the appellant. From the submissions of the appellant, we find that the film distributors entered into an agreement with the appellant to screen the movie in the theatre under two different situations i.e.: A. Agreement where right/license to exhibit the film is granted to the exhibitor by the distributor for specified number of shows and period; and, B. Agreement where theatrical exhibition rights in perpetuity to exhibit the films are guaranteed - In the second case, the appellant would make payment to the distributor for the grant of the rights to screen the films and the payments were described as “Theatre Shares”, “Fixed Hire”, “Theatre Hire”, which was specified percentage of the NBOC.

  In the case of Moti Talkies Vs. Commissioner of Service Tax, Delhi-I [2020 (6) TMI 87 - CESTAT NEW DELHI], the Principal Bench considered the agreements entered into between the distributor and the appellant being an exhibitor for screening pictures, which was alleged by the Revenue to be an agreement for “Renting of Immovable Property” as defined under Section 65(90a) of the Act. On the basis of the agreement between the parties, the Bench concluded that it is difficult to even visualise that the appellant is providing his service to the distributor by renting of property or even any other service in relation to such renting. It was held that the agreements executed confer rights upon the appellant to screen the film for which the appellant is making payment to the distributor and not the distributor making any payment to the appellant.

  What emerges from various decisions is that the owner of the Multiplexes/theatres exhibits the films and for getting the films exhibited in their theatre, they enter into agreements with the film distributors/producers for which the owner of the theatre agrees to pay certain amount to the distributors generally fixed as a percentage of the NBOC. The purpose of the agreement and the intention of the parties is for screening of the film in the theatre, which cannot be treated as “Renting of Immovable Property Service”. Moreover, the element of consideration, i.e. the quid pro quo for services, which is a necessary ingredient of any taxable service is absent. The revenue has not been able to establish the service provider and service recipient relationship between the appellant and the distributor, (Mormugao Port Trust). Consequently, no service tax can be levied on the appellant.

  Depending upon the terms of the agreement, the theatre owner also renders “operational or administrative assistance” and liable to pay service tax and respect of renting of Vimal property and also other “operational and administrative assistance”. Reference was made to the Circular dated 13.12.2011, clarifying the levy of service tax on distributors/sub distributor of films and exhibitors.

  There are no merits in the impugned order and hence, the same is set aside - appeal allowed.

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• 2025 (7) TMI 212
  

  Levy of service tax on or after 1.7.2010 - Renting of Immovable Property Service - upfront fee received by the appellant from various customers under the Concession Agreements entered prior to 1.7.2010 - Levy of penalty u/s 78 of FA - HELD THAT:- There are no doubt that the contention raised by the appellant that the definition of “Renting of Immovable Property” under Section 65(90a) of the Act only includes “leasing” and not an “agreement to lease” and since a “premium” is received by the appellant for entering into agreement to lease, this amount would not be exigible to service tax stands answered by the Larger Bench in Rajasthan State Industrial Development & Investment Corpn. Ltd. [2025 (2) TMI 211 - CESTAT NEW DELHI - LB] and the same needs to be followed, where The Bench noted that the term “lease” has not been defined in the Finance Act and hence, reliance was placed on the provisions of Sectiond 105 of the Transfer of Property Act, 1882, which defined “lease”. It was observed that the definition of “Renting of Immovable Property” includes “leasing” which under Section 105 of “TPA” includes both “premium” and “periodical rent” and, therefore, one time premium amount received by the lessor from the lessee for transfer of interest in the property would be leviable to service tax under Section 65(105)(zzzz) of the Act.

  There are no doubt that the contention raised by the appellant that the definition of “Renting of Immovable Property” under Section 65(90a) of the Act only includes “leasing” and not an “agreement to lease” and since a “premium” is received by the appellant for entering into agreement to lease, this amount would not be exigible to service tax stands answered by the Larger Bench and the same needs to be followed.

  Imposition of equivalent amount of penalty under Section 78 of the Act on the ground that the impugned order does not even allege that the appellant has not paid service tax by reason of fraud, or collusion or willful mis-statement or suppression of facts or contravention of any of the provisions of this Chapter or of the Rules made thereunder with intent to evade payment of service tax - HELD THAT:- The Tribunal in the case of Greater Noida Industrial Development Authority Vs. Commissioner of Central Excise and Service Tax [2014 (9) TMI 306 - CESTAT NEW DELHI] dealt with the similar issue and decided that service tax would be leviable only on the element of “rent” and not on the value of “premium” or “salami”. At the same time, it was held that it is a fit case where by invoking Section 80 of the Act, penalties under Section 76,77 and 78 have to be waived if the assessee proves that there was reasonable cause for the said failure and the appellant being an organization functioning under the Government of Uttar Pradesh and the obvious reason for non-payment of service tax, is their bonafide belief that the activity rendered by them would not attract service tax, therefore, set aside the penalties imposed under Section 78 by the impugned order. Following the said decision, the equivalent penalty imposed under Section 78 of the Act is unsustainable and is hereby set aside.

  On merits, the impugned order is affirmed, the same being in consonance with the decision of the Larger Bench, however, on the issue of penalty, the same is set aside to the extent referred above. The impugned order, is accordingly modified. The appeal stands allowed partly.

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• 2025 (7) TMI 211
  

  CENVAT Credit - capital goods or inputs - imported parts of the dredger - items imported for the purpose of taking credit when the same is admittedly used for repair of dredgers, which in turn has been used for providing taxable service - HELD THAT:- The issue whether an item can be both capital good as well as input for the purpose of providing taxable output service has been dealt with extensively by the Hon’ble Supreme Court in the case of Bharti Airtel Ltd., [2024 (11) TMI 1042 - SUPREME COURT], where, interalia, they held that 'We, therefore, agree with the conclusion arrived at by the Delhi High Court that towers and shelters (PFBs) support the BTS/antenna for effective transmission of mobile signals and thus enhance their efficiency and since these articles are components/accessories of BTS/antenna which are admittedly “capital goods” falling under Chapter 85 within sub-clause (i) of Rule 2(a)(A) of CENVAT Rules, these items consequently are covered by the definition of “capital goods” within the meaning of sub-clause (iii) read with sub-clause (i) of Rule 2(a)(A) of CENVAT Rules.'

  The impugned orders passed by the Adjudicating Authority in these appeals are not sustainable and therefore liable to be set aside - Appeal allowed.

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• 2025 (7) TMI 210
  

  Recovery of irregularly availed CENVAT Credit with interest and penalty - inputs or not - goods allegedly used to make support structures for machines - covered within the meaning of Rule 2(k) of CENVAT Credit Rules, 2004 or not - HELD THAT:- It is recorded by the Commissioner in Para 6.5 that as per the noticee the said goods have been used for making different parts and accessories of capital goods. The Commissioner (Appeals) however, did not take note of the said submission for the reason that the appellant did not furnish the specific sub heading of the said goods so produced. Of these the subject capital goods were claimed to be a part or accessory.

  It is brought out on record that the appellant vide their letter dated 28.07.2014 and Certificate of the Chartered Engineer dated 21.07.2014 had indicated to the Range Officer, item-wise & quantity-wise material used for production of support structures and such materials used for manufacture of different components and accessories of plant & machinery on which CENVAT Credit was not taken.

  It cannot be disputed that the impugned goods were not utilized for manufacture of items on which Cenvat was inadmissible with regard to the claim in respect of which CENVAT Credit had been availed by the appellant, they also furnished a copy of all such documents on record to prove their point alongwith their appeals. It has been a settled proposition of law that for parts, accessories or components, the use of such goods is identified with the machinery and with the said goods and used.

  It is also noted that out of the total credit of Rs.1,91,37,547/-, third party credit on H.R. Coils amounts to 12,91,671/- credit which has also been disallowed rendering a findings that such coils have been used for, structural components and support structures. On the contrary it has been the appellant consistent case that such H.R. Coils were actually used to make „FORMER’ an essential part of the furnace and this “Former” is placed in the furnace for manufacture of finished goods. The said Former is capable of withstanding 728 heats and in the process does actually gets mixed up with the final products as they melt inside the furnace itself. It is noted that in accordance with Board’s Circular No. 690/06/2003-CX dated 20.01.2003, credit on such Former is eligible to the assessee, as an input. There is no reason to disallow credit on such H.R. Coils gone into the manufacture of the said products. In view of discussions aforesaid, there is no substance in the Department’s allegation of contravention of Rules Z(k)3 and / or 9(5) of the Cenvat Credit Rules, 2004.

  H.R. Coils H.R. Sheets, H.R. Angles, H.R., Plates, etc. in view of their stated use can be considered as inputs in terms of Rule 2(k) of the CENVAT Credit Rules, 2004. The credit availed on such inputs would be admissible in terms of Rule 3(1) of CENVAT Credit Rules, 2004 - the impugned order is set aside - appeal allowed.

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• 2025 (7) TMI 209
  

  Dishonour of Cheque - main ground of challenge is that at the Stage of Charge, a broader view has to be taken while analysing the statements of witnesses - prima facie involvement if disclosed, is sufficient for the purpose of framing of Charge or not - HELD THAT:- The FSL establishes that the documents had the signatures of P. C. Minda, but that itself is not sufficient as the Complainant himself has admitted his signatures on these documents. However, the assertion is that the contents of the documents have been fabricated, which can be ascertained only by evidence.

  In the present case, the various documents relied upon by the Respondents to claim their innocence, are all disputed documents and their authenticity can only be established by way of evidence and cannot be adjudicated at this stage of framing of Charge.

  The statement of the Complainant that it was blank Cheques and the Letterhead which had his signatures and which have been subsequently manipulated by the Respondents coupled with the attending circumstances, do give rise to a prima facie case of theft against Respondent No. 1 Harish Bindal and under Sections 467/471/34 IPC against both the Respondents.

  The learned District and Sessions Judge fell in error in getting into the presumptions under Sections 139 and 118 of NI Act to practically adjudicate the cases under Section 138 NI Act, which was beyond the scope of consideration whether Chargesheet and the documents disclosed are prima facie case against the Respondents.

  The impugned Order dated 02.08.2011 passed by learned District and Sessions Judge, Rohini Courts, Delhi, is hereby set aside and the Order of the learned MM framing the charges against both the Respondents, is upheld - application disposed off.

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• 2025 (7) TMI 208
  

  Dishonour of Cheque - admitted issuance of the cheques bearing the signatures of Respondent No.3 - statutory presumption under Section 139 N.I. Act stands attracted or not.

  HELD THAT:- The conduct of the parties, needs to be considered from the yardstick of a prudent man. The Complainant has asserted that the Respondents had sought Rs.12,00,000/- for the purpose of business expansion. It does not appeal to prudence that the money so taken for expansion of business, could be returned within one month - The entire transaction also becomes suspicious from the fact that while according to the Complainant, at the time of giving the loan on 07.11.2014, he got the ‘Samjhauta’/Pronote executed on the same day. However, this Pronote is dated 07.11.2014 reflecting that the Loan was given in November 2014 and not in June/July, 2014 as claimed by the Complainant in his testimony. It does not seem reasonable that while the loan is allegedly given in June, July, the document/ ‘Samjhauta’/Pronote got prepared on 07.11.2014.

  Another significant fact to be noted is the inconsistency regarding execution of the Cheque. The Complainant had asserted in his testimony that the entire details on the cheque was filled by Mr. Surjit Singh, Respondent No. 2, but he contradicted himself by stating that the payee name and the amount had been filled by him. He, in his cross examination, again denied that he had filled the name and amount details.

  No person who has taken a loan for a fixed period of one month of Rs.12,00,000/-, would not fill at least the amount and the date while handing over the signed blank cheque. If so was the transaction for one month, there was nothing which would have prevented the Respondent No. 2, to have also filled the date on which the cheque may be presented along with the amount - Pertinently, it was also agreed as per the ‘Samjhauta,’ that the interest @2% per month would be payable. If it was a Loan amount given only for one month, then there was no reason for an interest Clause of interest payable @2 % per month, being incorporated in the alleged ‘Samjhauta’ document.

  The entire transaction as alleged by the Complainant, does not stand to reason and does not prove of him having given loan in the sum of Rs.12,00,000/-, for one month to the Respondents, on 07.11.2014.

  The learned Metropolitan Magistrate has rightly dismissed the Complaint and acquitted the Respondents - There is no merit in the present Appeal, which is hereby dismissed.

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• 2025 (7) TMI 207
  

  Dishonour of Cheque - security cheques - misuse of cheque - Commencement of IBC Proceedings - filing of complaint when CIRP had already been commenced and moratorium was imposed.

  Cheques were Security Cheques - HELD THAT:- The Security Cheques are only given to be utilised if subsequently, during the business transactions, certain liabilities exist which are not fulfilled by the Petitioners. In the present case as well, the entire objective of giving the security cheques was to secure any liability which may accrue in future and is not met by the Petitioners. The Complainants have specifically alleged about their being existing debt/liability on 08.05.2017, when the cheques were presented to the Bank - This contention of S.138 NI Act not attracted in respect of Security Cheques in the facts of present case, is absolutely not tenable.

  Blank Cheques being Misused - HELD THAT:- Admittedly, the signed cheques were given by the Petitioner Company, Innoventive Industries Limited to the Complainant Company, IFCI Factors Limited. Therefore, for the Petitioners to claim that the cheques have been subsequently manipulated, is absolutely incorrect - Moreover, the three months’ period for presentation of the cheque, arises from the date mentioned on the cheque and to assert that the cheques have been presented way beyond three months from 2009 when they were issued, is again absolutely fallacious, and contrary to the very concept of Security Cheques. The three-month period for the validity of the cheque would commence from the date on the cheque. This contention raised on behalf of the Petitioners, therefore, do not merit any consideration.

  Commencement of IBC Proceedings - case of Petitioners is that the Complaint Case under Section 138 of N.I. Act could not have been filed in August, 2017 once CIRP had already been commenced on 17.01.2017 and moratorium was imposed - HELD THAT:- Pertinently, the IBC proceedings got commenced in January, 2017 and subsequently, the powers of Board of Directors of the Company, Innoventive Industries Limited got suspended in terms of Section 17 IBC. The Management of the Affairs of the Petitioner Company got vested in the erstwhile RP and thereafter, the Liquidator. The intimation had been duly sent to the Banks especially IDBI Bank, Pune, by the RP - The Complainant after six months of initiation of CIRP proceedings, issued Legal Notice on 01.07.2017 for initiation of Complaint under Section 138 of N.I. Act. Having done so, the question arises whether there existed any cause of action for initiation of proceedings under Section 138 of N.I. Act, in August, 2017 when the Company is already undergoing CIRP.

  In the present case, the IBC proceedings had already got commenced in January, 2017 i.e. almost six months prior to the proceedings under S.138 NI Act. At the time when the Legal Notice dated 02.07.2017 was issued by the Complainant, the entire powers of Board of Directors, had come to be vested in the RP. Therefore, they were no powers either with the Company or that the Board of Directors and they had no managerial authority to pass any Board Resolution for repayment of the amounts under the impugned cheques - no vicarious liability can be attributed to the Directors in the absence of the Company, who are entitled to be discharged. Dishonour of Cheque due to ‘Insufficiency of Funds’.

  The Summoning Order dated 09.04.2018 is hereby set-aside against the three Petitioners who are discharged. The aforesaid three Petitions are accordingly, allowed.

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• 2025 (7) TMI 206
  

  Maintainability of petition - availability of alternative remedy - Cancellation of the Petitioner’s registration under the Maharashtra Goods and Services Tax Act, 2017 - Vague and bereft SCN - Violation of principles of natural justice - HELD THAT:- The show cause notice refers to Section 29(2)(e) and states that registration was obtained by means of fraud, willful misstatement or suppression of facts. Although a time limit was granted to file a reply and the Petitioner was informed that if he failed to appear for a personal hearing on the appointed date and time, the case would be decided ex parte, the show cause notice at Exh-B does not specify this appointed date or time.

  Merely quoting a Section and alleging that registration has been obtained through fraud, willful misstatement, or suppression of facts in a show cause notice is never enough. The noticee must be given an idea of what the alleged fraud, misstatement, or suppression of facts was. Only then will the noticee be able to understand the allegations against them and respond effectively.

  Regarding the alternative remedy, the objections are typically entertained and the parties are directed to pursue the statutory remedies available. However, it is well established that in cases of a gross breach of principles of natural justice, petitioners should not be relegated to the alternative remedies. The concern is not primarily with the final decision but with the fairness of the decision-making process itself. Any process that is not underpinned by natural justice renders the final decision susceptible to challenge. This stands as a notable exception to the rule of not entertaining petitions where effective alternative remedies are available.

  The impugned order is set aside - petition allowed.

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• 2025 (7) TMI 205
  

  Challenge to pre-show cause notice issued in Form GST DRC-01A, threatening to invoke proceedings u/s 74 of the WBGST/CGST Act, 2017 in respect of the tax period 2019-21 - HELD THAT:- Noting that the petitioner seeks to bring the pre-show cause notice dated 19th July 2024 to a logical conclusion and considering the fact that the consideration on the pre-show cause notice is pending for nearly a year, at this stage it would be prudent to direct the proper officer to decide on the pre-show cause notice on the basis of the response filed by the petitioner and if the proper officer is of the view that the pre-show cause notice need not to be proceeded, the proper officer should drop the proceedings. On the contrary if he is of the view that a notice u/s 73(1) or 74(1) of the said Act should be issued, he shall forthwith issue the same.

  Considering the peculiar facts and noting that the matter has been pending before this Court and noting that the pre-show cause notice remains outstanding for a year, in the event the proper officer is of the view that the pre-show cause notice is required to be issued u/s 73(1) of the said act, the petitioner shall be entitled to benefit of the Scheme introduced under Section 128 of the said Act provided the petitioner complies with all formalities and applies before the authority within 48 hours from the date of issue of such notice.

  The writ petition is disposed of.

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• 2025 (7) TMI 204
  

  Violation of principles of natural justice - Petitioner had no opportunity to meet with the allegations - vague SCN - fraud, willful misstatement or suppression of facts - cancellation of the Petitioner’s Registration - HELD THAT:- The Petitioner on instructions submitted that for a period of three months from today, the accumulated ITC will not be utilized.

  The impugned orders are set aside but the Respondents are granted liberty to issue a fresh show cause notice as proposed, within four weeks from today. The learned counsel for the Petitioner states that a response will be filed within four weeks of receiving the show cause notice. The show cause notice must be disposed of within four weeks of the Petitioner filing his reply to the same.

  Petition disposed off.

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• 2025 (7) TMI 203
  

  Violation of principles of natural justice - impugned order of assessment is an ex-parte order without considering the stand of the petitioner - suppression of turnover - invocation of extraordinary jurisdiction - HELD THAT:- The order u/s 73(9) read with Rule 142(5) of the Central/Bihar Goods and Service Tax Act and Rule, 2017 has been passed after the annual return furnished by the petitioner for the financial year 2018-19 was selected for scrutiny. The assessing authority noticed the suppression of turnover, availment and utilization of input tax credit wrongly and delayed payment of tax. The liability on these accounts were quantified under the provisions of Section 73(1) of CGST/BGST Act.

  In respect of suppression of turnover, the petitioner submitted that the mismatch in December 2018 return showing sales as per GSTR-3B at Rs.4,83,03,934.70/- was due to a clerical mistake. The actual sale for the period as per GSTR 1 in B2C was Rs.48,03,934.00/-. Thus, there was a difference of Rs.4,35,00,000.00/- in the sales figure. Similarly, there was a mismatch in January 2019 returns the sales as per GSTR 3B was Rs. 29,00,239.28/-, exempted sales was at Rs.1,68,750.00/- and the total sales for the period was Rs.30,68,989.28/- but as per GSTR 1, in B2B it was Rs.4,35,626.48/- and as per B2C it was Rs.20,05,429.00/-, the exempted sales was Rs. NIL which was said to be by way of mistake of accountant. Total sales for the period was Rs.24,41,055.48/-. Thus, the difference amount in sale was Rs.6,27,933.80/- and the net differences was Rs.4,41,27,934.50/-.

  The appellate authority has found that the appellant could not produce any evidence in terms of the clarifactory circular dated 27.02.2022 read with Section 16(2) (a) (b) (c) and (d).

  The petitioner has statutory remedy of appeal before the Tribunal, still the petitioner has chosen to move this Court in its extraordinary writ jurisdiction. This Court is of the considered opinion that the impugned orders are neither suffering from violation of principles of natural justice nor this Court finds any jurisdictional error committed by the respondent authorities. The scope of interference with the impugned orders in the extraordinary writ jurisdiction of this Court cannot be extended so as to entertain the present writ application.

  This writ application is dismissed.

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• 2025 (7) TMI 202
  

  Maintainability of petition - availability of efficacious remedy of filing an appeal u/s 107 of the GST act before the appellate authority - petitioner was not given any opportunity before the assessing authority during the assessment proceedings - violation of the principle of natural justice - HELD THAT:- A perusal of the provisions of Section 169 indicates that five modes of service have been provided and further that every decision, order, summons, notice or any communication shall be deemed to have been served on the date on which it is tendered or published or a copy thereof is affixed in the manner provided in sub section (1). Therefore, service can be effected at the discretion of the assessing authority by giving or tendering the notice directly or by a messenger including a courier or by registered post or by speed post or courier or by sending e- mail and or by making it available on the common portal or by publication in a news paper circulating in the locality in which the taxable person or the person to whom it is issued is last known to have resided, carried on business or personally worked for gain.

  The assessing authority in the impugned order has recorded that considering the discrepancy in the return filed by the petitioner are notice under section 61 of the GST act was sent on 04/10/2024 requiring the petitioner to remove the discrepancy pointed out in the said notice by 19/10/2024 - The petitioner did not either deposit the amount as directed by the assessing authority, nor did he reply to the notice and accordingly in the aforesaid circumstances the matter was heard ex - parte and decided by the impugned order dated 19/02/2025 which has been assailed in the present writ petition.

  The petitioner was duly communicated by the tax department as per the modes prescribed under Section 169, and therefore, it cannot be said that there was any violation of principles of natural justice. While interpreting the provision of section 169 we will also have to consider Section 13 of the Information Technology Act, 2000. According to Section 13 (2) electronic record deemed to be received when it enters the designated computer recourse. Similarly, as per section 13(3) unless it is otherwise agreed between the parties and electronic record is deemed to be dispatched at the place of the originator has his place of business is deemed to be received at the place of the addressee has his place of business - In the present case, it cannot be lost sight of the fact that at the time of registration the petitioner has disclosed his e-mail address and the mobile over for the purpose of communication, and there is, therefore, an agreement for exchange of communication through electronic mode. In case, the assessee has given a wrong email address, or an email address which is not accessible by him, may or may not be a valid defence which may be determined on the facts of each individual case, but one thing is clear that the respondent cannot be held be responsible for not giving adequate opportunity of hearing to the petitioner.

  The service of notice was made as per the provisions of Section 169 (c) of the GST Act and therefore, there was no breach of the fundamental rights of the petitioner with regard to service prior, during and after the assessment proceedings. In the aforesaid circumstances this court of the considered that the petitioner has an efficacious remedy by way of an appeal and therefore, the aspect of service can also be duly looked into after considering the facts and material produced by the petitioner and therefore for the said reason we do not proceed to determine the question as to whether as per sub clause 2 of section 169 once the service has been effected as per sub clause (c) & (d) of section 169, it shall be deemed to have been served on the date it is tendered.

  There are no merit in the claim of the petitioner that there is breach of fundamental rights that has occurred by not giving opportunity to the petitioner during the assessment proceedings and the impugned order has been passed without giving opportunity of hearing - the preliminary objection raised by learned counsel for the respondents that the petitioner has equally efficacious statutory remedy under Section 107 of GST Act before the First Appellate Authority is agreed and accordingly he is relegate to the same.

  The writ petition is not maintainable and the petitioner has equally efficacious remedy and accordingly he is relegated to the same. The petition is dismissed.

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• 2025 (7) TMI 201
  

  Violation of principles of natural justice - service of notice - all notices/communications were uploaded by the respondent under the “View Additional Notices and Orders” column in the GST common portal - impugned order came to be passed by the respondent without providing any opportunity of personal hearing to the petitioner - petitioner is willing to pay 25% of the disputed tax amount to the respondent - HELD THAT:- In the case on hand, it is evident that the show cause notice was uploaded on the GST Portal Tab. According to the petitioner, he was not aware of the issuance of the said show cause notice issued through the GST Portal and the original of the said show cause notice was not furnished to them. In such circumstances, this Court is of the view that the impugned assessment order came to be passed without affording any opportunity of personal hearing to the petitioner, confirming the proposals contained in the show cause notice.

  No doubt, sending notice by uploading in portal is a sufficient service, but, the Officer who is sending the repeated reminders, inspite of the fact that no response from the petitioner to the show cause notices etc., the Officer should have applied his/her mind and explored the possibility of sending notices by way of other modes prescribed in Section 169 of the GST Act, which are also the valid mode of service under the Act, otherwise it will not be an effective service, rather, it would only fulfilling the empty formalities. Merely passing an ex parte order by fulfilling the empty formalities will not serve any useful purpose and the same will only pave way for multiplicity of litigations, not only wasting the time of the Officer concerned, but also the precious time of the Appellate Authority/Tribunal and this Court as well.

  This Court finds that there is a lack of opportunities being provided to serve the notices/orders etc., effectively to the petitioner - it was submitted by the learned counsel for the petitioner that the petitioner is willing to pay 25% of the disputed tax amount to the respondent. In such view of the matter, this Court is inclined to set aside the impugned order dated 06.02.2025 passed by the respondent.

  The impugned order dated 06.02.2025 is set aside and the matter is remanded to the respondent for fresh consideration on condition that the petitioner shall pay 25% of disputed tax amount to the respondent within a period of four weeks from the date of receipt of a copy of this order. The setting aside of the impugned order will take effect from the date of payment of the said amount - Petition disposed off by way of remand.

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• 2025 (7) TMI 200
  

  Confirmation of entire original tax demand, without taking into aspect that the petitioner remitted 58% of the differential amount claimed by way of debit from electronic credit ledger - HELD THAT:- On perusal of the impugned order, it is clear that the entire tax proposal was confirmed and no credit was given in respect of 58% remitted by way of debiting the electronic credit ledger of the petitioner. Therefore, the matter requires reconsideration.

  The impugned order dated 07.05.2024 is set aside and the matter is remanded for reconsideration of the first respondent. After providing reasonable opportunity to the petitioner, the first respondent is directed to reconsider the matter, including by taking into consideration the remittances made by the petitioner by way of debit from electronic credit ledger.

  Petition disposed off by way of remand.

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• 2025 (7) TMI 199
  

  Entitlement to take input tax credit - HELD THAT:- Admittedly, the petitioner has submitted its invoice/debit note pertaining to the financial year 2018-19 and, that too, prior to 30-11-2021 and, therefore, the case of the petitioner very well comes under the provisions of sub-section (5) of Section 16.

  The respondent authorities are directed to consider the matter and pass an appropriate order taking into consideration the provision of sub-section (5) of Section 16 of the Central Goods and Services Tax Act, 2017, vide Amendment [Finance (No. 2) Act, 2024] dated 16-8-2024.

  Appeal disposed off.

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• 2025 (7) TMI 198
  

  Exemption from GST - activity of the applicant, involving the provision of pure services for the repair and maintenance of public street lighting infrastructure and the supply of manpower based on the work order issued by the local authorities of Kayamkulam Municipality - services of street light maintenance provided to various government authorities and government entities by the applicant - applicability of Serial No. 3 of N/N. 12/2017-Central Tax (Rate) dated 28.06.2017 and Serial No. 3A of the amended N/N. 12/2017-Central Tax (Rate) dated 25.01.2018 - Applicable SAC entry.

  Exemption from GST - activity of the applicant, involving the provision of pure services for the repair and maintenance of public street lighting infrastructure and the supply of manpower based on the work order issued by the local authorities of Kayamkulam Municipality - applicability of Serial No. 3 of N/N. 12/2017-Central Tax (Rate) dated 28.06.2017 and Serial No. 3A of the amended N/N. 12/2017-Central Tax (Rate) dated 25.01.2018 - HELD THAT:- Under the GST law, a Municipality is treated as a local authority by virtue of the definition provided under Section 2(69) of the CGST Act, 2017, which states that “local authority” includes a municipality as defined in clause (e) of Article 243P of the Constitution. Therefore, for the purposes of GST exemptions under Entry 3 of Notification No. 12/2017-Central Tax (Rate), a Municipality qualifies as a local authority, as it is a constitutionally recognized body entrusted with functions under Article 243W. Accordingly, services provided to a Municipality are eligible for exemption when they relate to such constitutional functions.

  The applicant's pure services of repair and maintenance of public street lighting infrastructure and supply of manpower based on the work order issued by Kayamkulam Municipality are covered under the said exemption and are not exigible to GST. However, this exemption applies only to pure services or to a composite supply where the value of goods involved does not exceed 25% of the total value.

  Applicable SAC entry - HELD THAT:- While the nature of the supply is indeed taxable under GST as it falls under the category of services, it has been held to be exempt under Entry 3 and Entry 3A of Notification No. 12/2017-Central Tax (Rate) dated 28-06-2017. Therefore, the question of applicable tax rate does not arise. If the exemption under Notification No. 12/2017 is not applicable, the supply would be taxable under SAC Heading 9987- Maintenance, Repair and Installation (except construction) Services, based on the description provided by the applicant.

  Whether the services of street light maintenance provided to various government authorities and government entities by the applicant, i.e., Kayamkulam Municipality, where the value of goods consumed is less than 25% of the total contract value, are eligible for exemption from GST as provided under Sr. No. 3A of Notification No. 12/2017-Central Tax (Rate) dated 28-06-2017, as amended by Notification No. 16/2021-Central Tax (Rate) dated 18-11-2021, being pure services as per the definition and relating to the functions listed under Articles 243G and 243W of the Constitution? - HELD THAT:- In cases where the value of goods involved does not exceed 25% of the total contract value, the supply falls under the NIL rate of tax as per Notification No. 12/2017-Central Tax (Rate) dated 28-06-2017 as amended by Notification No. 2/2018-Central Tax (Rate) dated 25-01-2018. Notification No. 16/2021-Central Tax (Rate) dated 18.11.2021 amended Entries 3 and 3A of Notification No. 12/2017-Central Tax (Rate) by omitting the words “or a Governmental authority or a Government Entity” from the list of eligible recipients. However, this amendment does not affect the exemption for supplies made to a “local authority”, which continues to be covered under both Entry 3 and Entry 3A, provided the supply is either of pure services or a composite supply involving goods not exceeding 25% of the total contract value, and the services relate to functions entrusted to Panchayats or Municipalities under Article 243G or Article 243W of the Constitution.

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• 2025 (7) TMI 197
  

  Taxability - fee collected by the applicant from employees who proceed on leave without allowance for engaging in private employment - fees collected from Self-financing educational institutions for conducting departmental inspection for issuing NOC/EC for starting new self-financing Medical, Nursing, Dental colleges' or starting new Courses and for enhancement of seats - rate of GST.

  Taxability on fee collected by the applicant from employees who proceed on leave without allowance for engaging in private employment - HELD THAT:- The collection of fees from Medical and Paramedical Officers for availing Leave Without Allowance (LWA) does not amount to a “supply” under Section 7 of the CGST Act, 2017. The act of granting leave arises out of an employer-employee relationship governed by service rules, and the levy of such fees is an administrative measure introduced as part of a broader public policy aimed at deterring indiscriminate availing of LWA, which adversely impacts the delivery of essential public health services. The fee does not involve any provision of goods or services, nor is it collected in the course or furtherance of any business activity. There is no contractual obligation on the part of the applicant to tolerate the act of taking leave, and the payment made by the employee is not in the nature of consideration for any service rendered. As clarified in CBIC Circular No. 178/10/2022-GST dated 03.08.2022, such deterrent or penal recoveries, including forfeiture of bond amounts or notice pay, are not consideration for any supply and are therefore not taxable.

  In view of the above, it is held that the fees collected in this context do not constitute taxable supply under GST law, and accordingly, no GST is leviable on such transactions.

  Taxability of Inspection fees - HELD THAT:- The affiliation-like services provided by the Directorate of Medical Education-namely, the inspection of facilities, faculty, infrastructure, and the issuance of No Objection Certificates (NOC) or Essentiality Certificates (EC) to private, self-financing medical, nursing, and dental colleges-are functionally and legally similar to the affiliation services discussed in the circular. These services are rendered for a consideration to private institutions for the purpose of enabling or expanding their commercial educational operations. Such services are not rendered to students or for the purpose of imparting education, but rather constitute a regulatory assessment and grant of eligibility to operate. Accordingly, following the same interpretation adopted in Circular 234, the services rendered by DME to self-financing institutions are also liable to GST at the rate of 18%.

  In terms of classification, such inspection and certification services do not fall under SAC 9992 (education services) but are appropriately classifiable under SAC 999799 - “Other services nowhere else classified”. As per N/N. 11/2017-Central Tax (Rate), services under SAC 999799 attract GST at the standard rate of 18% - the fees collected by the Directorate of Medical Education from self-financing institutions for conducting inspections and issuing NOC/ECs constitute a taxable supply of service under GST and attract GST at the rate of 18%.

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• 2025 (7) TMI 196
  

  Exemption from GST - taxability of Yoga course fees collected on behalf of the exempted Yoga courses marketed - applicability of N/N. 12/2017-Central Tax (Rate) dated 28.06.2017, specifically Entry No. 80, read with CBIC Circular No. 66/40/2018-GST dated 26.09.2018 - HELD THAT:- The applicant has claimed that it collects the Yoga course fee on behalf of the Yoga institutions and therefore should not be liable to pay GST on that portion of the transaction. Implicitly, this suggests reliance on the provisions of Rule 33 of the CGST Rules, 2017, which allow exclusion of certain expenses incurred by a supplier acting as a pure agent of the recipient of supply.

  However, in the present case, the applicant has not submitted any documentary evidence, contractual agreements, or transaction-specific details to demonstrate that it fulfils all the mandatory conditions prescribed under Rule 33. These include the existence of a contractual arrangement with the recipients authorizing the applicant to incur expenses on their behalf, separate indication of such amounts in the invoice, and strict pass-through of actual costs without markup or benefit. In the absence of such evidence, it is not possible for this Authority to conclude that the applicant is operating as a pure agent within the meaning of Rule 33. Accordingly, the benefit of exclusion from taxable value under Rule 33 cannot be extended to the Yoga course fee component in the current circumstances.

  A third party organization which markets an exempted Yoga course is not exempted from GST for the Yoga course fees component. However, if the service offered by them is in the nature of pure agent within the scope of Rule 33 of the CGST Rules, 2017, they would be entitled for exemption from GST for the Yoga course fees component.

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• 2025 (7) TMI 195
  

  Classification of goods - rate of GST - Rooter Trainer Cup, made of plastic, used exclusively for propagation of plants, which an agricultural activity - to be classified under HSN 8201 90 00 or otherwise?

  Classification of goods - HELD THAT:- The item in question is made of plastic, and “Plastics and Articles thereof” fall under Chapter 39 of the Customs Tariff. The Chapter Notes to Chapter 39 do not exclude the subject product or any goods related to agricultural activity from its scope. Chapters 3901 to 3914 cover various types of plastics in primary forms, while Chapter 3915 pertains to waste, parings, and scraps of plastics. Chapter 3916 covers monofilaments. Chapters 3916 to 3925 describe various plastic products with specific classifications, none of which include the item under discussion, viz., rooter trainer cups or similar agriculture-related plastic products. Tariff heading 3926, which is the last 4-digit heading under Chapter 39, covers “Other Articles of Plastics.”

  Since the product in question does not fall under any of the preceding specific headings, it is appropriately classified under this residual heading. Upon verification of -the 6-digit classifications under heading 3926, it is found that there is no specific entry covering the subject product, and therefore it falls under the residual sub-heading 3926 90 and further under the residual entry 3926 90 99.

  The product in question, namely the “Rooter Trainer Cup” made of plastic, is appropriately classifiable under Customs Tariff Heading (CTH) 3926 90 99, which shall be the applicable classification for the purposes of levy of GST.

  Applicable rate of tax - HELD THAT:- The item appears to fall under SI. No. 45 of Schedule IV of Notification No. 1/2017-Central Tax (Rate) dated 28.06.2017, which reads as: 'Other articles of plastics and articles of other materials of headings 3901 to 3914 [other than bangles of plastic, PVC belt conveyor, plastic beads and plastic tarpaulins]'. This entry attracts Central GST at the rate of 14%, and an equal rate is applicable under the corresponding State GST notification. Further, Sl. No. 137 of Notification No. 2/2017-Central Tax (Rate) dated 28.06.2017 provides exemption to agricultural implements that are manually operated or animal-driven, falling under Chapter 8201. Since the item in question neither qualifies under Chapter 8201 nor satisfies the condition of being a manually operated or animal-driven implement, the exemption is not applicable in this case. Notification No. 41/2017-C.T.(Rate) (14-11-2017) omitted S. No.45 from Schedule IV w.e.f. 15.11.2017. Also, in S. No. 111, for the entry in column (3), the entry “Other articles of plastics and articles of other materials of headings 3901 to 3914 [other than bangles of plastic, plastic beads and feeding bottles]” was substituted. In practice, Schedule III, Sl.. 111 of Notification No. 1/2017-Central Tax (Rate) now covers 3926 at CGST 9% and SGST 9%.

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• 2025 (7) TMI 194
  

  Taxability of medicines and medical supplies to patients - applicability of N/N. 1/2017-Central Tax (Rate) dated 28-06-2017 - Supply of medicines, implants and other supplies to inpatients - Supplies made to patients who are not admitted to the hospital but who receive treatment as outpatients - Supply of medicines and other supplies to patients based on a doctor's prescription, specifically for consumption at home and during follow-up care -

  Taxability - medicines and medical supplies to patients - applicability of N/N. 1/2017-Central Tax (Rate) dated 28-06-2017 - HELD THAT:- In accordance with the provisions of Section 2(30) of the CGST Act, where the supply of medicines or medical items is naturally bundled with healthcare services-such as in the course of diagnosis, treatment, or care for illness, injury, deformity, abnormality, or pregnancy in any recognised system of medicine in India-the entire supply qualifies as a composite supply. In such cases, the principal supply is the provision of healthcare services by a clinical establishment, an authorised medical practitioner, or paramedics. Consequently, any medicines and medical supplies that are naturally bundled with such healthcare services inherit the nature of the principal supply and therefore become eligible for GST exemption - This interpretation is also supported by Circular No. 32/06/2018-GST dated 12-02-2018, wherein it was clarified that “Food supplied to the in-patients as advised by the doctor/nutritionist is a part of the composite supply of healthcare and not separately taxable. “Accordingly, the underlying principle is that healthcare services are exempt from GST. When medicines and medical products are supplied as part of a naturally bundled package with healthcare services, the entire supply is treated as a composite supply, and the exemption available to healthcare services under GST applies to the entire transaction, including the medicines and medical products.

  In the case of outpatients, hospitals generally prescribe medicines but do not administer or remain involved in their continuous treatment. It is entirely up to the patient to decide whether to follow the prescription, and if so, from where to procure the medicines. The choice to purchase or not, or to source them from an external pharmacy, lies solely with the patient. Because the hospital does not exercise control over the patient's continuing treatment after the consultation, such supplies of medicines or consumables cannot be said to be naturally bundled with healthcare services. Consequently, they do not qualify as a composite supply. As a result, the GST exemption applicable to healthcare services does not extend to such supplies of medicines or allied goods, and these are accordingly treated as taxable supplies under GST.

  Supply of medicines, implants and other supplies to inpatients - HELD THAT:- The supply of these items are naturally bundled with supply of health care services as discussed above. Therefore, such supplies are eligible for exemption under Entry No. 74 of Notification No. 12/2017-Central Tax (Rate) dated 28-06-2017 subject to the conditions stipulated in the Notification.

  Supplies made to patients who are not admitted to the hospital but who receive treatment as outpatients - HELD THAT:- The medicines and other supplies provided to patients are naturally bundled with the underlying health care services. Importantly, the law does not create a distinction between 'inpatients' and 'outpatients' for the purpose of granting exemption. Instead, the eligibility for exemption must be assessed on the basis of whether the supplies are part of a composite supply of medical services. Therefore, where a hospital provides treatment to patients without admitting them, such as in the case of dialysis, dressing, chemotherapy, minor surgeries, or other similar procedures-including pre-admission care like services rendered in casualty-the exemption shall apply, provided that the medicines and supplies are naturally bundled with the delivery of health care services. However, it is important to note that the exemption is limited to cases where the supplies are part of a naturally bundled package of health care services delivered within the hospital.

  Supply of medicines and other supplies to patients based on a doctor's prescription, specifically for consumption at home and during follow-up care - HELD THAT:- These supplies are not naturally bundled with the provision of health care services. Since the hospital's involvement is limited to prescribing and dispensing the medicines-without continuous treatment or direct supervision-the supply of medicines in this context does not constitute a composite supply of health care services. Accordingly, such supplies fall outside the ambit of health care services as defined for GST purposes, and therefore, are not eligible for the exemption granted to health care services.

  However, the exemption from GST on supplies made to inpatients or outpatients as part of their treatment within the hospital does not apply when medicines or other items are sold to them with GST. In such cases, since GST has been collected, it must be paid to the government as per Section 76 of the CGST Act, 2017.

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