TMI Tax Updates - e-Newsletter
February 7, 2020

Case Laws in this Newsletter:

GST Income Tax Customs Corporate Laws Insolvency & Bankruptcy Service Tax Central Excise CST, VAT & Sales Tax Indian Laws

Articles

1. AMENDMENT TO CUSTOMS TARIFF (IDENTIFICATION, ASSESSMENT AND COLLECTION OF COUNTERVEILING DUTY ON SUBSIDISED ARTICLES AND FOR DETERMINATION OF INJURY) RULES, 1995

   By: DR.MARIAPPAN GOVINDARAJAN

2. RECENT ANTI-PROFITEERING ORDERS ON SUPPLY OF SANITARY NAPKINS

   By: Dr. Sanjiv Agarwal

News

1. Quality and Best Practices of Utmost Importance for Success of Agri Export Policy

2. Income Tax Department conducts search on prominent persons in Film Industry in Tamil Nadu

3. Sixth Bi-monthly Monetary Policy Statement, 2019-20 Resolution of the Monetary Policy Committee (MPC) Reserve Bank of India

Notifications

Customs

1. 11/2020 - dated 6-2-2020 - Cus (NT)

Exchange Rates Notification No.11/2020-Custom (NT) dated 06.02.2020

DGFT

2. 46/2015-2020 - dated 6-2-2020 - FTP

Amendment in Export Policy of Onions

GST - States

3. F.NO.FIN/REV-3/GST/I/08 (Pt-I) (Vol 1) /20 - dated 10-1-2020 - Nagaland SGST

Seeks to amend Notification F.NO.FIN/REV-3/GST/1/08 (Pt-1)/44 dated the 25th January, 2018

4. F.NO.FIN/REV-3/GST/I/08 (Pt-I) (Vol 1) /18, - dated 1-1-2020 - Nagaland SGST

CT Seeks to bring into force certain provisions of the Nagaland Ordinance No 2 of 2019

5. F.NO.FIN/REV-3/GST/1/08 (Pt-1) (Vol.1)/13 - dated 26-12-2019 - Nagaland SGST

CT Seeks to waive late fees for non- filing of FORM GSTR-1 from July 2017 to November 2019

6. CT/LEG/GST-NT/12/17/1207-15/2019 - dated 23-12-2019 - Nagaland SGST

CT Seeks to extend the last date for filing of FORM GSTR-3B for the month of November 2019

7. F.NO.FIN/REV-3/GST/I/08 (Pt-I) (Vol 1) /12 - dated 13-12-2019 - Nagaland SGST

CT Seeks to notify the class of registered person required to issue invoice having QR Code

SEZ

8. S.O. 566(E) - dated 27-1-2020 - SEZ

Central Government de-notifies an area of 0.15 hectares making the resultant area as 9.85 hectares, at KIADB, Industrial Area, Taluka Hebbel-Hootagally, District Mysore in the State of Karnataka

Circulars / Instructions / Orders

SEBI

1. SEBI/HO/IMD/DF6/CIR/P/2020/24 - dated 5-2-2020

Disclosure Standards for Alternative Investment Funds (AIFs)

Customs

2. 09/2020 - dated 5-2-2020

Streamlining export data to include District level details in Shipping Bills

3. 07/2020 - dated 5-2-2020

Valuation of second hand machinery

Highlights / Catch Notes

GST

• Provisional GST Account Attachment Not Automatic; Limited to Specific Conditions u/s 83. Broad Use Restricted.

  Case-Laws - HC : Provisional attachment of bank account of petitioner - Section 83 does not provide for an automatic extension to any other taxable person from an inquiry specifically launched against a taxable person under these provisions. - Only upon contingencies provided therein that the power under section 83 can be exercised. This power is to be used in only limited circumstances and it is not an omnibus power.
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Income Tax

• Rental Income from Warehouses as Primary Business Activity Taxed as "Income from Business" Not "House Property.

  Case-Laws - HC : Correct head of income - income from letting out of warehouses or property to lessees - in cases where the earning of the rental income is the exclusive or predominant business of the Assessee, the income earned by way of lease money or rentals by letting out of the property cannot be taxed under the Head 'Income from hosue property', but can only be taxed under the Head 'Income from business income'.
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• Interest Expenses Disallowed u/s 36(1)(iii) for Asset Not Used in Assessment Year 2008-09.

  Case-Laws - AT : Disallowance of interest expenses - Admittedly, the proviso to section 36(1)(iii) of the Act is applicable during the relevant assessment year, namely 2008-09 and since the asset (land) has not been put to use by the assessee, the interest expenditure for acquiring the same cannot be allowed as a deduction
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Customs

• New guidelines issued for valuing second-hand machinery imports, focusing on depreciation and market conditions for consistency.

  Circulars : Valuation of second hand machinery
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• New Rule: Shipping Bills Must Include District Details to Improve Export Data Accuracy and Regional Trade Insights.

  Circulars : Streamlining export data to include District level details in Shipping Bills
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• Board Circular's Time Limit on Shipping Bill Conversion Not Binding u/s 149 of Customs Act 1962.

  Case-Laws - AT : Conversion of shipping bills - It is settled law that the time limit prescribed by the Board Circular is not binding as same is not statutory provision in terms of section 149 of the Customs Act 1962. - The appellant is legally entitled for conversion of drawback Shipping Bills to DFIA Shipping Bills in respect of 184 Shipping Bills
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• Customs Department Disputes Tyre Valuation; Emphasizes Need for Current Import Data to Support Valuation Claims.

  Case-Laws - AT : Valuation of imported goods - rejection of declared value - Tyres are regularly imported all over the country and therefore the Department could have easily garnered evidence of contemporaneous imports which it admittedly did not do.
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• Sales agent of foreign supplier cleared of penalties under Customs Act sections 112(a) & 112(b) due to lack of evidence.

  Case-Laws - AT : Imposition of penalty on sales agent of foreign supplier u/s 112(a) and/ or 112(b) of the Customs Act, 1962 - omission/ commission committed by sales agent of foreign supplier or not who has acted on the direction of Principal - He was acting in course of normal business - There is nothing on record to establish that he had abetted in the evasion of duty by mis-declaring the value - No penalty.
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Corporate Law

• Majority Shareholders May Buy Out Minority Due to Mismanagement; Valuation Report by Registered Valuer Required.

  Case-Laws - AT : There are certain oppression and mismanagement. The relationship between the Majority Shareholders & Minority Shareholders are strained. Hence, there is a need for valuation report to be done by Registered valuer and the majority shareholders are free to buy the shares of the minority shareholders or otherwise.
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Indian Laws

• New Tax Regime in Indian Budget 2020-21: Revised Corporate Rates to Boost Compliance, Focus on Infrastructure, Income Inequality

  News : Budget 2020-21 + FINANCE BILL, 2020
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• Section 138 of Negotiable Instruments Act: Cheque must be presented within 3 months for dishonor action.

  Case-Laws - HC : Dishonor of Cheque - The Clause (a) of Proviso to Section 138 of N.I. Act stipulates that Section 138 shall not be applicable unless the cheque is presented to the bank within a period of six months (Now 3 months) from the date on which it is drawn or within the period of its validity, whichever is earlier.
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• Cheque for Time-Barred Debt Creates Enforceable Contract; Not Considered Non-Legally Enforceable Debt or Liability.

  Case-Laws - HC : Dishonor of Cheque - Once a cheque is drawn for discharge of a time barred debt, it creates a promise which becomes an enforceable contract and therefore, it cannot be said that the cheque is drawn in discharge of debt or liability which is not legally enforceable.
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Service Tax

• Entity Challenges Service Tax on Modem Rentals, Citing VAT Payment and Deemed Sale Status Under Article 366(29)A.

  Case-Laws - AT : Levy of service tax - renting of Modem - they are paying VAT and therefore, the transaction of Modem is a deemed sale in terms of Article 366(29)A of the Constitution, which is exclusive from service.
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Central Excise

• No Extra Reversal Needed for CENVAT Credit Not Transitioned to GST as of July 1, 2017.

  Case-Laws - AT : Reversal of CENVAT Credit - The Appellant has done the said reversal in the books of accounts and has thereby not carried the said Cenvat credit into GST regime. Further, the GST regime has been introduced w.e.f. 01/07/2017. Thus, there is no further reversal required in the matter.
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• CENVAT Credit Allowed: Rule 9(1)(bb) Exception Not Applicable in Revenue-Neutral Service Tax Payments Case.

  Case-Laws - AT : CENVAT Credit - duty paying invoices / documents - once the payment of service tax and availment of credit resulted in revenue neutral situation, then the exception created by Rule 9(1) (bb) of Cenvat Credit Rules is not applicable to the facts of the present case.
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• Court Upholds Transaction Value for Liquid Sachets Sold by Weight u/s 4 of Central Excise Act.

  Case-Laws - AT : Valuation - MRP based value u/s 4A or transaction value u/s 4 - The goods in the form of liquid packed in sachets though may be sold in numbers, it cannot be said that they are not being sold by weight or volume as each sachet contains pre-determined quantity of the liquid by weight as well as by volume. - Valuation u/s 4 upheld.
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• Tribunal Overrules Decision: Interest on Delayed Refund Granted Despite New Grounds Cited by Appellant.

  Case-Laws - AT : Interest on delayed refund - Once the appellant has taken the ground of closure of factory in the year 2012 itself before the Commissioner(Appeals), then thereafter the adjudicating authority holding that the Tribunal has allowed the appeal on altogether new ground is not sustainable in law.
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Case Laws:

• GST

• 2020 (2) TMI 216
  Provisional attachment of bank account of petitioner - no proceedings U/Ss 62, 63, 64, 67, 73 and 74 against the Petitioner as mentioned under Section 83 of CGST Act are pending - HELD THAT:- The issue decided in the case of KAISH IMPEX PRIVATE LIMITED VERSUS THE UNION OF INDIA, THE PRINCIPAL CHIEF COMMISSIONER CGST CENTRAL EXCISE, ASSISTANT COMMISSIONER OF CGST RANGE (IV) , [ 2020 (1) TMI 933 - BOMBAY HIGH COURT] where it was held that The bank account of the taxable person can be attached against whom the proceedings under the sections mentioned above are initiated. Section 83 does not provide for an automatic extension to any other taxable person from an inquiry specifically launched against a taxable person under these provisions. Only upon contingencies provided therein that the power under section 83 can be exercised. This power is to be used in only limited circumstances and it is not an omnibus power. Order of attachment set aside - petition allowed.

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• 2020 (2) TMI 215
  Provisional release of goods with conveyance - requirement of appropriate application under Section 67(6) of the GST Act, 2017 - HELD THAT:- This petition is disposed of by directing the respondents authorities to consider the application to be made by the petitioner for provisional release of the goods and vehicle in accordance with law. The respondents authorities will decide such application as expeditiously as possibly preferably within two weeks from the date of receipt of such application of the petitioner. Petition disposed off.

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• Income Tax

• 2020 (2) TMI 214
  Entitlement to deduction under Section 80P - issue in regard to the classification and taxability of interest income has not been specifically raised in the affidavit filed in support of the Writ Petitions - HELD THAT:- Though all petitioners have not replied identically to the notices issued by the officer, the above replies are illustrative of the stands adopted by the petitioners at the time of assessment and crystallize the arguments of the petitioners to the effect that (i) the investments in question do not comprise surplus funds (ii) that the investments constitute a statutory reserve as mandated by the TNCS Act (iii) the interest generated therefrom was eligible for deduction in the light of Nawanshahar [ 2005 (8) TMI 28 - SC ORDER] (iv) at worst the interest received should be netted with interest paid. These arguments ought to have been at least, considered, by the Assessing Authority in deciding the issue but have unfortunately been brushed aside despite being noted in the order itself. This amounts to a fatal flaw as it renders the impugned order entirely non-speaking and passed without application of mind. If the affidavits of the petitioners are looked upon as mechanical and filed in haste and without application of mind, equally so are the impugned orders of assessment that simply rely on Totgars [ 2010 (2) TMI 3 - SUPREME COURT] without discussing the arguments put forth by the petitioners. For this reason the arguments of the revenue based on the lack of pleadings in the affidavit is rejected. I am of the considered view that in a case such as the present, the petitioners should not suffer for lacunae in drafting particularly when the stand of the petitioners is very clear from the materials on record. Thus, to balance the convenience of both parties and in the interests of justice, this issue is set aside for denovo and fresh examination and conclusion by the respondent. Classification of interest generated from deposits made and held as statutory reserve for the grant of deduction under Section 80P of the I.T. Act, they are set aside. The petitioners are directed to appear before their respective Assessing Officers on 14.02.2020 at 10.30 a.m. without expecting any further notice and my directions in this regard as set out in paragraph No.21 will apply equally in these cases.

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• 2020 (2) TMI 213
  Correct head of income - income from letting out of warehouses or property to lessees - Income from Business or Income from House Property - HELD THAT:- It is not even in dispute that all the exclusive and main source of income of the Assessee was only the rentals and lease money received from the lessees in both the cases and the Assessing Authority took a different and contrary view mainly to deny the claim of depreciation out of such business income in the form of rentals, without assigning any proper and cogent reason. Merely because the lease income or rental income earned from the lessees, could be taxed as Income from House Property , ignoring the fact that that such rentals were the only source of Business Income of the Assessee, the Authorities below have fallen into the error in holding that the income was taxable under the Head Income from house property. The said application of the Head of Income by the Authorities below was not only against the facts and evidence available on record, but against the common sense itself. Even the amended definition intends to tax the notional income of the self occupied portion of the property to run Assessee s own business therein as business income. Therefore, the other rental income earned from letting out of the property, which is the business of the Assessee itself, cannot be taxed as Income from house property. Heads of Income, as defined in Section 14 of the Act do not exist in silos or in watertight compartments under the Scheme of tax and thus, these Heads of Income, as we have noted above, are fields and heads of sources of income depending upon the nature of business of the Assessee. Therefore, in cases where the earning of the rental income is the exclusive or predominant business of the Assessee, the income earned by way of lease money or rentals by letting out of the property cannot be taxed under the Head Income from hosue property , but can only be taxed under the Head Income from business income . Where the facts of the cases are undisputed that both the Assessees in the present case carry on the business of earning the rental income, as per the Memorandum of Associations only and the fact is that they were not carrying on any other business, compels us to come to the conclusion that the present appeals of the Assessees are required to be allowed. The same are accordingly allowed and the question of law framed above is answered in favour of the Assessee

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• 2020 (2) TMI 212
  Petition for stay u/s 226(6) - HELD THAT:- Without going into the merits of the case, the learned Counsel for the petitioner states that the petitioner may be permitted to deposit 10% of the demand instead of 20%, as directed in the impugned order. The learned Standing Counsel appearing for the respondents has no serious objection for this course. Writ Petition is partly allowed and the impugned order, dated 10.01.2020 directing the petitioner to pay 20% of the disputed demanded amount to respondents in respect of the assessment year 2017-18 is set aside. The petitioner is directed to remit a sum of Rs. 2,00,000/- within a period of 15 days from the date of receipt of a copy of this order. On such deposit being made by the petitioner within the time stipulated, the order challenged before the appellate authority stands stayed till the disposal of the appeal.

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• 2020 (2) TMI 211
  Condonation of delay - Sufficient cause for the assessee in not filing the appeal in time before Ld CIT(A) - HELD THAT:- Sufficient cause for the assessee in not filing the appeal in time before Ld CIT(A). As held by Hon ble Supreme Court in the case of Mst. Katiji [ 1987 (2) TMI 61 - SUPREME COURT] natural justice should prevail over technical considerations. In fact, allowing an opportunity to present its case will only promote the cause of justice. Accordingly we are of the view that the delay in filing appeal before Ld CIT(A) deserves to be condoned. However, the same shall be at a cost. Accordingly we impose a cost of Rs. 5000/- (Rupees Five thousand) upon the assessee which shall be paid to the credit of the Income tax Department as other fees on or before 29-02-2010. Subject to the payment of above cost, we condone the delay in filing appeal before Ld CIT(A). Since the Ld CIT(A) has not adjudicated grounds urged on merits, we deem it proper to restore all the issues to his file for adjudicating them afresh. Reopening of assessment - Addition of Product Development Expenses - addition was made by the AO in the assessment order passed u/s 143(3) - HELD THAT:- The assessee is not entitled to challenge the addition, which was not made in the reassessment order, since the reassessment proceedings are for the benefit of revenue as held by Hon ble Supreme Court in the case of Sun Engineering Works (P) Ltd [ 1992 (9) TMI 1 - SUPREME COURT] . Accordingly we do not find any infirmity in the order passed by Ld CIT(A) on this issue.

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• 2020 (2) TMI 210
  Quantification of deduction admission u/s 80P(2)(a)(i) and 80P(2)(d) - HELD THAT:- In Vir Transport Operator Co-op Credit Services Society Ltd . [2018 (12) TMI 1313 - ITAT AHMEDABAD] held only thing which requires to be done is redetermination or quantification of amount which is to be disallowed out of interest income from the scheduled bank. The ld.AO shall work out the net interest income from the deposits with scheduled bank, and thereafter exclude that amount from the computation of deduction claimed under section 80P(2)(a)(i) of the Act. As far as interest income from cooperative bank/society is concerned in view of the decision of coordinate Bench, such income will qualify for grant of deduction under section 80P(2)(d) of the Act. The ld.AO shall work out net amount of such interest income, and thereafter grant deduction under section 80(2)(d). Assessee has filed its return of income at NIL after claiming deduction under section 80P(2)(a)(i) - addition has been made on the ground that the assessee has claimed deduction with respect to income earned from deposits made with scheduled bank - HELD THAT:- Direct the AO to re-adjudicate the issue and only exclude net interest income from nationalised bank from computation of income admissible under section 80P(2) of the Act. The AO shall adjudicate this issue after providing due opportunity of hearing to the assessee. Deduction u/s 80P(2) for deduction of interest income earned from scheduled bank - HELD THAT:- Assessee is covered by the decision of Hon ble jurisdictional High Court in the case of State Bank of India Employees Coop Credit Ltd. [ 2016 (7) TMI 516 - GUJARAT HIGH COURT] wherein it has been held by that cooperative society would not be eligible under section 80P(2) of the Act for deduction of interest income earned from scheduled bank. Further, assessee has agreed to proportionate disallowance to the extent of bank interest to total income. Disallowance which the assessee has received from its members towards form fee, cannot doubted to be not attributable to and/or arising from assessee s day-to-day activities of the assessee. Therefore, allow this claim of the assessee and delete disallowance. Allowance of standard deduction claimed by the assessee under section 80P(2)(c) of the Act, the same being statutory deduction, the assessee will be entitled for the same.

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• 2020 (2) TMI 209
  Denying the benefit of section 11 - corpus donation - HELD THAT:- The assessee produced confirmation and bank account and relevant details to prove it was a corpus donation.Therefore, it could not be added to the income of the assessee. CIT(A) correctly directed to delete the addition. The Revenue did not challenge the deletion of addition on account of corpus donation. Therefore, findings of fact recorded by Ld. CIT(A) are confirmed. If the corpus donation is excluded nothing would survive against the assessee so as to make any addition. In this view of the matter, there is no merit in Departmental appeal. Carry forward loss to next year for setting off against income of subsequent year - HELD THAT:- Authorities below have failed to appreciate that income has to be computed commercially even in cases covered u/s 11-13 of the Act and resultant loss, if any, arising due to surplus application of income has to be computed and carry forward to the next year to be set off therein. AO has not given any findings on the same. CIT(A) without examining the issue in detail dismissed the claim of assessee because section 11 provides for exemption of income of charitable organization. However, it is a fact that assessee claimed carry forward of the losses for subsequent year as per law which should have been appreciated and should be considered in favour of the assessee.

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• 2020 (2) TMI 208
  Reopening of assessment u/s 147 - no sufficient opportunity had been given and no cross examination was conducted - non speaking order of CIT-A - CIT(A) justification in concurring with the AO in confirming the addition without affording sufficient opportunity of hearing of the appellant - HELD THAT:- CIT(A) has disposed of the legal grounds regarding reopening u/s. 148 of the Act as well as given the relief of Rs. 10 lacs and upheld the balance addition of Rs. 9.75 lacs, I am of the view that the finding given by the Ld. CIT(A) by deleting the addition of Rs. 10 lacs and sustaining the addition of Rs. 9.75 lacs is non-speaking one, which is not acceptable in the eyes of law. Keeping in view of the facts of the present case and the arguments advanced by both the parties as well as documentary evidences filed by the assessee, the issues in dispute require a thorough consideration and adjudication on the basis of documentary evidences filed by the assessee and the case laws on the legal issue by the Ld. CIT(A) as the non-speaking order is not sustainable in the eyes of law. Appeal of the Assessee is allowed for statistical purposes.

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• 2020 (2) TMI 207
  Reopening of assessment u/s 147 - HELD THAT:- Assessing Officer has reopened the case of the assessee when the proceedings under section 154 of the I.T. Act, 1961 were pending on the same issue. The ITAT Jaipur Benches [ 2018 (2) TMI 1635 - ITAT JAIPUR] has decided this issue in favour of the assessee and set aside initiation of proceeding u/s 147/148 of the Act and consequential reassessment order, as a result thereof the grounds on merits have become infructuous. Keeping in view the facts and circumstances of the present case, I am of the view that the issue in dispute has already been adjudicated and decided in favour of the assessee by the ITAT Jaipur Benches (supra) - cancel the proceedings initiated u/s 147/148 and consequential reassessment order

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• 2020 (2) TMI 206
  Disallowance of interest expenses for the reason that the interest bearing funds were diverted for purchase of a land - DR submitted that by virtue of amendment by Finance Act, 2003 with effect from 01/04/2004, proviso to section 36(1)(iii) was introduced, whereby the interest on borrowed funds till the asset was to be used cannot be allowed as deduction - HELD THAT:- As rightly pointed out by the Ld. DR, amendment to Finance Act, 2003 w.e.f. 01/04/2004 has inserted proviso to section 36(1)(iii) which clearly states that interest on borrowed funds in respect of capital borrowed for acquisition of an asset shall not be allowed as deduction till the date on which the said asset was put to use for the purpose of business. In the instant case, amounts borrowed have been diverted for purchase of an asset which belongs to the assessee s firm. Admittedly, the said asset was not put to use even as on date of hearing of this appeal. Therefore, going by the proviso to section 36(1)(iii) of the I.T. Act, interest expenses on capital borrowed for purchase of asset cannot be allowed as deduction. In other words, interest expenditure has to be necesssarily capitalised. The judicial pronouncements relied on by the Ld. AR relates to the case laws prior to the introduction of proviso to section 36(1)(iii). Admittedly, the proviso to section 36(1)(iii) of the Act is applicable during the relevant assessment year, namely 2008-09 and since the asset (land) has not been put to use by the assessee, the interest expenditure for acquiring the same cannot be allowed as a deduction - Decided against assessee.

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• 2020 (2) TMI 205
  Revision u/s 263 - nature and character of the lease premium receipt and its taxability - HELD THAT:- In the course of hearing before us, AR has referred to the order dated 15th march 2019, passed by te NCLT, Mumbai Bench, to advance the proposition that the amount received is in the nature of advance, hence, cannot be treated as income of the assessee in the impugned assessment year. However, it is evident, the aforesaid order of the NCLT was neither available before the Assessing Officer nor before learned PCIT before completion of proceedings under section 263 of the Act. It is clear, while exercising power u/s 263 of the Act, the revisional authority may call for and examine the record of any proceedings under the Act. The word record has been defined under the Explanation 1(b) to mean all records relating to any proceedings under the Act available at the time of examination by the revisional authority. Admittedly, at the time of examination of record by learned PCIT or even while passing the order under section 263 of the Act, the order passed by the NCLT was not available. Therefore, there is no question of taking cognizance of such order while exercising the power under section 263 of the Act. Be that as it may, since, we have directed the Assessing Officer to examine the nature and character of the lease premium receipt and its taxability, the assessee is at liberty to furnish all the material/evidence including the order passed by the NCLT, Mumbai Bench, as referred to above, to advance its case. With the aforesaid observations, grounds raised are partly allowed for statistical purposes.

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• Customs

• 2020 (2) TMI 204
  Jurisdiction - power to reopen an appeal - power to review an order - Whether CESTAT could reopen an appeal for hearing which was already finally disposed of by its own previous order? - Whether CESTAT has power to review its own order and pass fresh final order in the absence of any petition for review? HELD THAT:- It is obvious that very taking up the Appeal by the Tribunal on 19th April, 2007 was an exercise in excess of jurisdiction. Since the Appeal had already been disposed of by the order dated 10th July, 1998, there was really no occasion for taking up such appeal for reconsideration. It is obvious that such taking up of the Appeal was a result of miscommunication. It is obvious that the factum of disposal of the Appeal by order dated 10th July, 1998 was not brought to the notice of the Tribunal, either by the SDR or the staff of the Tribunal. For these reasons alone, the impugned orders dated 19.04.2007 in both these appeals are liable to be set aside and are hereby set aside. It is not necessary to go into the larger issue as to whether the Tribunal has any power to review its own Judgments and orders. However, we must note that Ms. Desai did place reliance upon the decision of the Madras High Court in CP. AQUACULTURE (INDIA) PVT. LTD. VERSUS PRESIDENT, CESTAT [ 2010 (11) TMI 166 - MADRAS HIGH COURT] to submit that the Tribunal is not vested with any such power of review. The substantial questions of law are liable to be answered in favour of the Appellant and against the Respondent.

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• 2020 (2) TMI 203
  Condonation of delay in filing appeal - financial hardships of the appellant not considered - principles of natural justice - HELD THAT:- Although the sufficient cause assigned may not be quite convincing, yet having regard to the merits of the main matter and also with a view to give one opportunity to the appellant to make good his case in appeal before the Tribunal, we are inclined to exercise our discretion in favour of the appellant. The delay in preferring the appeal before the Tribunal is hereby condoned. The impugned orders passed by the Tribunal are hereby quashed and set aside. The main appeal is restored to the original file of the Appellate Tribunal - decided in favor of appellant.

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• 2020 (2) TMI 202
  Conversion of shipping bills - conversion from Drawback scheme to Duty Free Import Authorization (DFIA) Scheme - request for conversion was rejected on the ground that the appellant exporter made the request for conversion after three months from the date of let Export Order in violation of period prescribed under Board Circular No 36/2010-Cus dated 23.09.2010 - HELD THAT:- From Section 149 of Customs Act 1962 it is clear that no time limit is prescribed. The request of the appellant for conversion was rejected on the sole ground of limitation as prescribed under Board Circular No. 36/2010-Cus. Since the time limit has not been prescribed under the act, the same cannot be fixed by way of the circular. Therefore, if at all there is a time limit by way of circular it is only procedural requirement. Therefore, on this ground of limitation, application could not have been rejected, particularly when circular prescribing time limit is without authority of any statutory provision, act and rules supported. It is settled law that the time limit prescribed by the Board Circular is not binding as same is not statutory provision in terms of section 149 of the Customs Act 1962. The appellant is legally entitled for conversion of drawback Shipping Bills to DFIA Shipping Bills in respect of 184 Shipping Bills as per the list provided in appeal along with the appeal memo - Appeal allowed - decided in favor of appellant.

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• 2020 (2) TMI 201
  Penalty u/s 114 of CA - Smuggling - prohibited item or not - red sanders logs and the cabbage bags - allegation that the penalty has been levied based solely on the inculpatory statements - HELD THAT:- The statement of the appellant Shri. Karuppiah recorded on 09.10.2013 under Section 108 of the Customs Act reveals the modus operandi and this appellant has very clearly explained not only the whole transaction but also named various persons involved, in the smuggling activity and has also clearly identified the destination i.e., foreign buyer M/s. Haiphong Petro Trading JSC, No. 782, Chua Ve, Doana, 2nd Street, Dong Hai, 1 Ward, Hai An Dist. HP, Vietnam. Revenue has linked each and every chain in the whole loop of the master plan to smuggle the contraband by identifying the involvement and role of each and every person whereas nothing is brought on record by the appellants to dislodge even a small link in the above chain. Their contention that they did not claim ownership nor did they have wherewithal, etc., would not help them since in an activity of the nature involved in the present case, the recipient/buyer would be least interested in knowing this. Because, otherwise, the buyer would have right royally bought from the open market after paying all necessary/applicable duties rather than choosing a shortcut of smuggling. Appeal dismissed - decided against appellant.

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• 2020 (2) TMI 200
  Refund of SAD - Benefit of N/N. 102/2007-Cus dt. 14/09/2007 - HELD THAT:- This issue is no more res integra and has been settled by various decisions of the Tribunal including the decision of this Tribunal in the appellant s own case VALLABHDAS AND CO. BALAKRISHNA SALES CORPORATION VERSUS COMMISSIONER OF CUSTOMS COCHIN [ 2017 (5) TMI 1371 - CESTAT BANGALORE] wherein the Tribunal has allowed all the appeals by relying upon the earlier decisions of the Tribunal. Besides this, both the authorities have wrongly relied upon the decision of the Apex Court which was in respect of N/N. 34/1998-Cus. dated 13.06.1998. Further, the said Notification 34/1998 has been subsequently rescinded by N/N. 58/1998-Cus. dated 01.08.1998. Therefore, reliance by both the parties on a Notification which has been rescinded is not tenable in law. Appeal allowed - decided in favor of appellant.

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• 2020 (2) TMI 199
  Valuation of imported goods - rejection of declared value - prohibited goods or not - contemporaneous imports/NIDB data - HELD THAT:- The tyres are not prohibited item under Exim policy, and can be imported freely. Further as the tyres are generally required all over the country there are several importers of identical/similar goods. It is trite law that since the goods were assessed by proper officer based on transaction value, onus lies on the Revenue to prove undervaluation, which it has failed miserably to do so since it did not show any contemporaneous import data of identical or similar items or NIDB data to indicate undervaluation and therefore the invoice value is required be accepted and the transaction value itself and hence could not have been discarded. No copy of the emails on which the Department seeks to rely has been made as RUDs. Emails and other electronic evidence cannot be relied upon to prove undervaluation in absence of compliance of provisions of Section 138C of the Act - Thus statements of Shri H S Chadha cannot be relied upon and given credence to substantiate the Departments claim of undervaluation without any corroborative evidence and the charge of undervaluation cannot be made out on mere assumptions and presumptions especially since he himself has stated on various occasions that there is no undervaluation and these are quotations. Tyres are regularly imported all over the country and therefore the Department could have easily garnered evidence of contemporaneous imports which it admittedly did not do. Appeal allowed - decided in favor of appellant.

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• 2020 (2) TMI 198
  Request of adjournment - non-prosecution on the part of appellant - HELD THAT:- The appellant is not interested in giving any explanation about contradiction, if any, in the decision of two coordinate benches nor seems aggrieved thereof despite the opportunity was given vide the final order dated 5 March 2019. Thus the absence of the appellant consecutively for almost five times since the impugned final order is sufficient to hold non-prosecution on the part of appellant. Apparently the said order was not only pronounced in open court but was dictated as a whole in the open court. The recording in para 12 of the said decision is inter-se the Members presiding the said bench it is post pronouncement but before signing the said final order and it was in the interest of justice that the opportunity to both the parties was given to put-forth their stand about the acceptance or denial of those observations in para 12 of the impugned final order. Once the appellant opted to not to appear for the purpose, the final order of 5 March 2019 is definitely a judgment as was pronounced in the open court which should have been operated since the day of its pronouncement. Appeal dismissed.

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• 2020 (2) TMI 197
  Smuggling - television of brand name of Sony and Samsung were found in their premises which were kept for sale - HELD THAT:- In this case, during the course of search, 228 pieces of television sets of Sony and Samsung were recovered from the premises of the appellant. Revenue made vague allegations against the appellant alleging that these are smuggled-one. In fact, these television sets are having serial numbers and in the case of Samsung Malaysia, it was enquired by Revenue regarding whether these television sets with the serial numbers have been manufactured by them or not. In reply to the query, the same were answered no . If that is the situation, Revenue has failed to prove that the television sets in question are smuggled one. Moreover, the item in question is not notified item under Section 123 of the Customs Act, 1962. Therefore, the appellant is not required to prove that these television sets have been procured by them from licit means. It is the burden on the Revenue to prove that these television sets are smuggled-one which Revenue failed to do so. The appellant is neither liable to pay any duty nor these goods are liable for confiscation. Therefore, no redemption fine and penalty is imposable on the appellant - Appeal allowed - decided in favor of appellant.

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• 2020 (2) TMI 196
  Restoration of appeal - monetary amount involved in the appeal - HELD THAT:- The present Miscellaneous Application is filed by revenue and the contention of revenue is that the disputed amount is more than Rs. 10 lakhs and being the Customs appeal the same is not covered by litigation policy and therefore, Final Order may be recalled and appeal may be restored to its original number - Appeal restored to its original number.

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• 2020 (2) TMI 195
  Imposition of penalty on sales agent of foreign supplier u/s 112(a) and/ or 112(b) of the Customs Act, 1962 - omission/ commission committed by sales agent of foreign supplier or not who has acted on the direction of Principal - HELD THAT:- The matter in the case of Respondent 1 has been settled by the order of Settlement Commission as has been noted by the Commissioner in the impugned order. Even the review order and appeal filed do not urge anything in respect of the dropping of the proceedings against them in view of immunity granted by the Settlement Commission, we do not find any merits in the appeal and dismiss the same as infructuous. The fact that Shri Santosh Nair (sales agent) has issued the Proforma invoice as directed by Vice President (Sales) of the supplier, has not been controverted by the revenue in the appeal filed. Also it is fact on record that the import documents i.e. Bill of Entry was filed on the basis of Commercial Invoice 328 32686 dated 28.12.1998 issued by the supplier M/s Signtech USA. Since the Proforma issued by the Shri Santosh Nair was not even the basis for filing the import documents the relevance of the same in the current proceedings for imposition of penalty is not understood. In fact said Proforma invoice was never the part of the import documentation, though it was part of negotiation documents between the foreign supplier and the Importer in India. Thus, Shri Santosh Nair was acting in course of normal business as sales agent of foreign supplier and had offered the sale price of the machine as directed by the foreign supplier to the Indian importer. There is nothing on record to establish that he had abetted in the evasion of duty by mis-declaring the value, for purpose of imposition of penalty under section 112(a) and/ or 112(b) of the Customs Act, 1962. Appeal dismissed.

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• Corporate Laws

• 2020 (2) TMI 194
  Oppression and mismanagement - diversion of funds - siphoning of funds - right to subscribe additional shares - HELD THAT:- Through the various submissions made by both the parties and finally reached the conclusion that the minority shareholders are requiring exit from the Company but that cannot provide a ground for denying their right to subscribe additional shares in proportion to their share holding vis- -vis that of the total paid up capital of the Company as required under Section 81 of the Companies Act, 1956 (Part III). There are certain oppression and mismanagement. The relationship between the Majority Shareholders Minority Shareholders are strained. Hence, there is a need for valuation report to be done by Registered valuer and the majority shareholders are free to buy the shares of the minority shareholders or otherwise - the Balance Sheet from 2005 to 2008 reflects Reserve and Surplus is getting strengthened. However, parties have not submitted updated audited Balance Sheet, so that it can be commented upon. Appeal dismissed - decided against appellant.

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• Insolvency & Bankruptcy

• 2020 (2) TMI 193
  Maintainability of application - non transfer of Interest Bearing Maintenance Security Deposit - Section 7 of the Insolvency and Bankruptcy Code, 2016 - Corporate Debtor entitlement to retain the one-time maintenance and liability towards electricity etc. and individual liability against the resident - HELD THAT:- The Adjudicating Authority is only required to see whether the application under Section 7 has been filed by 100 allottees, who are members of RWA or a 10% of the allottees who are members of the allottees to maintain it. The Adjudicating Authority is required to take into consideration only the Form-1 and the enclosure therein but find out the default, if any and to proceed in accordance with law. Before the admission of the application under Section 7, the Adjudicating Authority has no jurisdiction to direct the Corporate Debtor to deposit any amount to certain corpus or with regard to maintenance which may not be a subject matter of application under Section 7. Case remanded to the Adjudicating Authority to decide the matter in accordance with law taking into consideration the fact whether the claim, as made, comes within the meaning of financial debt as defined under Section 5(8) and on the basis of Form-1 as filed by the Applicant and not on the basis of any pleading by one or other parties - appeal allowed.

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• 2020 (2) TMI 192
  Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its debt - existence of debt and default or not - HELD THAT:- In the instant application, from the material placed on record by the Applicant, this Authority is satisfied that the Corporate Debtor committed default in paying the financial debt to the Applicants and the respondent company has acknowledged the debt - In the instant case, the documents produced by the Financial Creditors clearly establish the debt and there is default on the part of the Corporate Debtor in payment of the financial debt . There is existence of default and that the application under Section 7(2) of the Code is also complete in all respect - the petitioners/financial creditors having fulfilled all the requirements of Section 7 of the Code, the instant petition deserves to be admitted. Petition admitted - moratorium declared.

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• Service Tax

• 2020 (2) TMI 191
  Extended period of limitation - penalty - demand of service tax under the category of Business Auxiliary Service - HELD THAT:- As the issue has been decided by this Tribunal in the case of MR. CHARANJEET SINGH KHANUJA AND OTHERS VERSUS CST, INDORE/LUCKNOW/JAIPUR/LUDHIANA AND OTHERS [ 2015 (6) TMI 585 - CESTAT NEW DELHI] and this decision has been followed in various cases, wherein the benefit of extended period of limitation is granted. Thus, in the cases in hand, the extended period is not invokable, consequently, no penalty is not imposable on the appellants - appellants are directed to deposit service tax for the period within the limitation period within 30 days along with interest after communication of this order - appeal disposed off.

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• 2020 (2) TMI 190
  Maintainability of appeal - non-prosecution of the case - it appears that the appellant is not interested in responding the notice - HELD THAT:- The appellants have not responded to the notice issued to them for hearing in the matter or attended hearing any time when the matter was listed. Thus, it appears that they are not interested in pursuing this matter. Accordingly in terms of Rule 20 of the CESTAT (Procedure) Rules, 1982 after allowing more than three adjournments this appeal is dismissed for non-prosecution.

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• 2020 (2) TMI 189
  Demand of interest on amount deposited under Section 35F of the Central Excise Act, 1944 - HELD THAT:- The appellant has filed a refund claim for the amount deposited as pre-deposit for entertaining their appeal by this Tribunal and any pre-deposit made by the assessee is a deposit under Section 35F of the Central Excise Act, 1944. The appellant has rightly claimed interest under Section 35FF of the Act on refund of pre-deposit made by them under Section 35F of the Act. Appellant has claimed interest under Section 35FF for the amount deposited by them for entertaining their appeal by this Tribunal. The appellant is entitled to claim interest on the pre-deposit i.e. the whole amount deposited by the appellant for entertaining the appeal - Appeal allowed - decided in favor of appellant.

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• 2020 (2) TMI 188
  Refund of service tax - rejection on the ground that appellant has failed to show the nexus of service availed and export thereof and appellant has failed to produce invoices of the services which they have received and the address mentioned in the invoice is not correct - HELD THAT:- At the time of availment of CENVAT credit, it was not questioned to the appellant that on the services in question, CENVAT credit is not admissible, therefore, the same cannot be objected at the time of entertaining the refund claim. The refund claims on account of denial of refund for nexus of input service with export service cannot be rejected. The refund claims on this account are allowed - Appeal allowed - decided in favor of appellant.

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• 2020 (2) TMI 187
  Levy of service tax - Online Information and Data Base Access service - renting of Modem - HELD THAT:- It is not under dispute that the appellant, on one hand paying the service tax on the Internet Service provided to the customers and, on the other hand they are giving Modem on rental basis. The transaction of providing Modem on rent basis is an independent transaction. In such transaction, they are paying VAT and therefore, the transaction of Modem is a deemed sale in terms of Article 366(29)A of the Constitution, which is exclusive from service. Since the nature of transaction is not under dispute that the same is deemed sale, no service tax can be demanded. The transaction of deemed sale will not attract service tax - Appeal allowed - decided in favor of appellant.

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• Central Excise

• 2020 (2) TMI 186
  Reversal of CENVAT Credit - contravention of provisions of Rule 16 of the Central Excise Rules, 2002 and Rule 2, 3(2), 4 of the Cenvat Credit Rules, 2004 read with section 2(f) of the Central Excise Act, 1944 - period of dispute from October 2012 to March 2013. Whether the Appellant has already reversed the amount of Rs. 11,06,691/- as Cenvat credit or not by making an entry in the books of accounts on 30/06/2017 and thereby reducing the amount of Cenvat credit to be transferred in TRAN 1 form in GST? - HELD THAT:- The Appellant has done the said reversal in the books of accounts and has thereby not carried the said Cenvat credit into GST regime. Further, the GST regime has been introduced w.e.f. 01/07/2017. Thus, there is no further reversal required in the matter. Hence the demand to the extent of Rs. 11,06,691/- as confirmed by the learned Commissioner (Appeals) deserves to be set aside. Demand of interest - HELD THAT:- The Appellant has asserted that it had sufficient credit balance in its account and also produced a Chartered Accountant certificate for the same. Based on the applicable provisions under Rule 14 of the CENVAT Credit Rules, as was in force during the period from April 2012 to March 2013, It is held that the Appellant is not required to pay any interest. Thus, since the appellant had sufficient credit balances, in any case, there would be no loss of Revenue to the exchequer. Therefore, the imposition of interest in the present proceedings cannot sustain and hence, the same is set aside. Appeal disposed off.

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• 2020 (2) TMI 185
  CENVAT Credit - duty paying invoices - duty paid invoices issued by registered dealers namely, M/s. Pranav Metal Mart, Nadiad without receipt of goods covered in the said invoices - penalty - HELD THAT:- Though the DGCEI has conducted thorough investigation but that is related to the transportation of goods from Delhi to the registered dealer i.e. M/s. Pranav Metal Mart, Nadiad. Even in the said investigation the only evidence found was that the truck by which the goods were transported from Delhi to Nadiad were carrying some other goods. However, otherwise the movement of vehicle from Delhi to Nadiad is not much in dispute. The appellant have purchased the goods from M/s. Pranav Metal Mart, Nadiad. As regard transaction between the said registered dealer and the present appellant, no discrepancy was found. The investigation did not enquire anything from the appellant and they have not disputed the receipt of goods in their factory, recording the same in the books of accounts and excise records. The use of such goods and the manufacture of final product out of the said input and clearances thereof on payment of duty is not disputed. Entire case was based on the investigation between Delhi importers and the registered dealer i.e. M/s. Pranav Metal Mart - there are no sufficient, tangible and cogent evidences gathered to establish that the appellant have not received the inputs in their factory and fraudulently availed the Cenvat Credit only on the basis of invoice therefore, there are no basis for denial of Cenvat Credit to the appellant. Penalties also set aside. Appeal allowed - decided in favor of appellant.

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• 2020 (2) TMI 184
  CENVAT Credit - duty paying invoices - the service tax paid voluntarily without raising any supplementary invoices - Rule 9(1) (bb) of Cenvat Credit Rules, 2004 - revenue neutrality - extended period of limitation - HELD THAT:- The provisions of Rule 9(1)(bb) of the Cenvat Credit Rules, 2004 is not applicable to the facts of the case as the appellant has not availed credit on supplementary invoices but on the basis of delayed payment of service tax and the same cannot be the basis to deny the credit by invoking the provisions of Rule 9(1)(bb). Further the delayed payment of service tax voluntarily does not amount to suppression of fact with intent to evade payment of tax and hence denial of credit by invoking Rule 9(1)(bb) is not tenable in law. Revenue Neutrality - HELD THAT:- The entire exercise of payment of service tax and availment of credit has resulted into revenue neutral situation - further, once the payment of service tax and availment of credit resulted in revenue neutral situation, then the exception created by Rule 9(1) (bb) of Cenvat Credit Rules is not applicable to the facts of the present case. Extended period of limitation - HELD THAT:- Once the appellant has paid the service tax voluntarily and informed the Department accordingly, then denial of credit on the ground of suppression of fact by invoking longer period of limitation cannot be sustained. Appeal allowed - decided in favor of appellant.

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• 2020 (2) TMI 183
  CENVAT credit - exempt goods/by-product - Bagasse/Pressmud - period April, 2009 to October, 2010 - applicability of rule 6 of CCR - HELD THAT:- The issue of applicability of Rule 6(1) of CENVAT Credit Rules, 2004 to bagasse/pressmud which emerges during the course of manufacture of sugar and molasses, has been settled taking note of the judgment of Hon ble Supreme Court in the case of UNION OF INDIA VERSUS DSCL SUGAR LTD. [ 2015 (10) TMI 566 - SUPREME COURT] in favour of the assessee. Appeal allowed - decided in favor of assessee.

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• 2020 (2) TMI 182
  Valuation - MRP based value u/s 4A or transaction value u/s 4 - shampoo sold in sachets - HELD THAT:- The goods in question itself is not required to affix MRP as per Rule 34(b) of Legal Metrology Act / Rules. The Tribunal in the case of Sarvotham Care Ltd. [ 2013 (4) TMI 505 - CESTAT BANGALORE ] had analysed a similar issue and has held that The goods in the form of liquid packed in sachets though may be sold in numbers, it cannot be said that they are not being sold by weight or volume as each sachet contains pre-determined quantity of the liquid by weight as well as by volume. The valuation done by the appellant under section 4 of the Central Excise Act, 1944 is correct. Therefore the demand made by the department under section 4A therefore cannot sustain - Appeal allowed - decided in favor of appellant.

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• 2020 (2) TMI 181
  CENVAT Credit - duty paying invoices - fake invoices issued by non-existing suppliers - benefit of N/N. 34/2003-C.E vis- -vis circular no. 703/19/2003-CX dt. 25-3-2003 - admissibility of appeal for hearing - monetary amount involved in the appeal - HELD THAT:- For duty demand of Rs. 25,544/- appellant had gone to the Hon ble High Court as its appeal was not admitted for hearing because of operation of Section 35B that provides monetary limit to file appeal before the CESTAT. So primarily on point of law, this appeal is admitted for hearing in the CESTAT and factual aspect on which the issue of original appellant M/s. Accelerate Synthetic Pvt. Ltd. had gone for re-adjudication is un-related to this instant appeal as genuiness of the invoices received and availement of Cenvat Credit by M/s. Accelerate Synthetics Pvt. Ltd. would be determined in that re-adjudication process. Going by the text of N/N. 34/2003-C.E, under para 1 (2)(a) it has been clearly mentioned that first or second stage dealer may, at his option, remove such goods after undertaking activities such as packing, repacking etc. on payment of amount equivalent to duty of excise, which is levyable on such goods, it can avail Cenvat Credit on the same. Therefore, the appellant may also exercise his option not to remove such goods but payment of equivalent duty on such goods was a pre-condition which is under dispute because the first dealer is i.e. original supplier of appellant has been prosecuted for non-payment of duty and availement of Cenvat Credit which was subsequently passed on to the appellant by the supplier. This being the factual scenario, it is on the supplier of appellant on whom duty liability is to be determined since the credit has been passed on to the appellant by supplier after all payments had been made by the appellant. The denial of availment of Cenvat Credit on the ground that no physical movement of goods had taken place is also not in conformity to the procedure meant to be followed by the deemed textile manufactures - appeal allowed - decided in favor of appellant.

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• 2020 (2) TMI 180
  Valuation - inclusion of amortization cost of the mould in the manufacturing cost of the finished goods viz. articles of plastic - whether the amortization cost of the moulds be added @ 0.66% as observed by the learned Commissioner (Appeals) or @ 1.75% to cost of manufacture of plastic articles? - HELD THAT:- The said amortization percentage has been arrived at based on the Chartered Accountatn s certificate and no contrary evidence has been placed by the Revenue to rebut the said finding of the learned Commissioner (Appeals). Also, the amount involved in the present appeal if calculated taking the revised amortization cost of mould @ 1.75% would definitely be less than Rs. 50.00 lakhs, hence covered by the Litigation Policy Circular dated 22.08.2019. Appeal dismissed - decided against Revenue.

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• 2020 (2) TMI 179
  Interest on delayed refund - grant of interest denied on the ground that Hon ble CESTAT allowed the appeal of the appellant on the altogether new point and ground which was not existing at the time of rejection of the refund - Section 11BB of the Central Excise Act, 1944 - HELD THAT:- Admittedly the refund claim was filed on 29/12/2011 and the same was rejected by the original authority on 27/03/2012 and the appeal against the said order was also rejected by the Commissioner(Appeals) vide order dt. 17/10/2012. Further the Tribunal vide its Final order dt. 12/01/2018 has allowed the appeal of the appellant and in pursuance to the Final order, the original authority sanctioned the refund vide order dt. 02/08/2018 but did not grant interest which was demanded by the appellant for delay in sanctioning the refund. Further, the only ground on which the interest has been denied by the original authority and upheld by the appellant authority is that the CESTAT has allowed the appeal on altogether different ground which was not existing at the time of rejection of refund claim. Further, the appellant has raised the ground of closure of business before the Commissioner(Appeals) and also agitated the same at the time of personal hearing on 09/07/2012 itself and this fact is clearly recorded by the Commissioner(Appeals) in his order dt. 17/10/2012 in para 3 which is reproduced. Once the appellant has taken the ground of closure of factory in the year 2012 itself before the Commissioner(Appeals), then thereafter the adjudicating authority holding that the Tribunal has allowed the appeal on altogether new ground is not sustainable in law. The impugned order is not sustainable in law and the same is set aside by allowing the appeal of the appellant - The original authority will quantify the interest after the expiry of 3 months from the date of filing of the refund claim till the interest is finally sanctioned - appeal allowed by way of remand.

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• CST, VAT & Sales Tax

• 2020 (2) TMI 178
  Restoration of assessment order - rejection of book-version and determining taxable turnover of imported goods - rejection of book version of the revisionist on the basis of survey conducted at the premises of another dealer - opportunity of cross-examination not provided - U.P. Trade Tax Act, 1948 - whether the Tribunal has rightly up held the order of imposition of tax which was based on the survey made of the premises of M/s Gomti Interiors wherein certain loose papers were found which were estimates prepared by the revisionist while dispatching the goods to the purchaser? HELD THAT:- While rejecting the books of account, it has no where stated by any of the taxing authority below that it was in the course of business that estimates were sent alongwith the goods to the purchaser and bill was submitted only subsequently which included only the goods actually supplied to the purchaser excluding the goods which were returned by the purchaser. The Revenue has not disputed this fact before any of the authorities below - Second aspect which needs consideration is as to whether in supplying the goods the revisionist was engaged in purchases from outside the State for which declaration and Form is required to be obtained from the respondent. It is admitted case that the revisionist had not obtained any goods from outside the State and also that no goods were purchased from the unregistered dealers, was exempted from tax. In the light of provisions of contained in Section 3A of the Act, 1948, the revisionist had infact declared goods purchased by him from the registered dealers and the First Appellate Authority has also considered the fact that in subsequent years also no tax has been imposed on the revisionist. The Tribunal has failed to discharge its duty while accepting the plea of the Revenue. The finding of fact recorded by the first Appellate Authority that there was no material with the Revenue to conclude that the goods were either imported from outside the State or purchased from unregistered dealers, cannot be set aside lightly on the basis of apprehension expressed by the Revenue and therefore in the peculiar facts of the case the questions are decided in favour of assessee and against the Revenue. Revision allowed.

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• Indian Laws

• 2020 (2) TMI 177
  Dishonor of Cheque - section 138 of NI Act - non-presentation of the cheque - HELD THAT:- Admittedly, the cheque was presented to the drawee bank after the period of expiry of its validity of three months, which is to be calculated from the date mentioned on the cheque. The Clause (a) of Proviso to Section 138 of N.I. Act stipulates that Section 138 shall not be applicable unless the cheque is presented to the bank within a period of six months (the period has been reduced from 6 months to 3 months vide the aforementioned RBI notification dated 04.11.2011) from the date on which it is drawn or within the period of its validity, whichever is earlier. Petition allowed.

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• 2020 (2) TMI 176
  Dishonor of Cheque - legally enforceable debt and liability or not - offence punishable under Section 138 of the Negotiable Instruments Act 1881 or not - time barred debt - HELD THAT:- Once a cheque is drawn for discharge of a time barred debt, it creates a promise which becomes an enforceable contract and therefore, it cannot be said that the cheque is drawn in discharge of debt or liability which is not legally enforceable. Therefore, the impugned judgment dated 16.9.1998 has to be set aside and is hereby set aside. The matter is remanded to the trial Court to decide, based on the evidence already recorded, whether the complainant has proved the ingredients of offence punishable under Section 138 of the Negotiable Instruments Act 1881 - Appeal allowed by way of remand.

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