TMI Tax Updates - e-Newsletter
April 17, 2025

Case Laws in this Newsletter:

GST Income Tax Customs Service Tax Central Excise

TMI Short Notes

1. Simplified Rent Deduction Mechanism for Non-HRA Assessees : Clause 134 of the Income Tax Bill, 2025 Vs. Section 80GG of the Income-tax Act, 1961

  Bills:

2. Transformation of Tax Deduction Mechanism in respect of donations to certain funds : Clause 133 of the Income Tax Bill, 2025 Vs. Section 80G of the Income-tax Act, 1961

  Bills:

3. Promoting Green Transportation tax Incentives for Electric Vehicles : Clause 132 of the Income Tax Bill, 2025 Vs. Section 80EEB of the Income Tax Act, 1961

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4. Promoting Home Ownership by allowing deductions on interest payments : Clause 131 of Income tax Bill, 2025 Vs. Section 80EEA of the Income Tax act, 1961

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5. Promoting Affordable Housing through deduction in respect of interest on loans : Clause 130 of the Income Tax bill, 2025 Vs. Section 80EE of the income Tax Act, 1961

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6. Modernizing Tax Benefits for Higher Education : Clause 129 of the Income Tax Bill, 2025 Vs. Section 80E of the Income Tax Act, 1961

  Bills:

Articles

1. Writ Jurisdiction and the Doctrine of Privity of Contract

   By: Abhay Singh

2. Checklist of Documents Required for OPC Annual Return Filing

   By: Ishita Ramani

3. NON-REFUND OF GST BY THE DEPARTMENT DESPITE THE ORDER OF APPELLATE AUTHORITY DIRECTING TO REFUND THE AMOUNT

   By: DR.MARIAPPAN GOVINDARAJAN

4. LEVY OF GST ON OVERHEAD CHARGES IN BEER MANUFACTURING

   By: Dr. Sanjiv Agarwal

5. Global Organic Textile Standard (GOTS)

   By: YAGAY andSUN

6. General Environmental Non-Compliances by Indian Manufacturing Sector, Especially Red Category Industries.

   By: YAGAY andSUN

7. Regional Value Content (RVC) in Free Trade Agreements (FTAs) - In-depth Analysis in the Context of Indian FTAs with Key Developments

   By: YAGAY andSUN

8. Analysis of Circular No. 11/2025-Customs - Implementation of Export Entry (Post Export Conversion in Relation to Instrument-Based Scheme) Regulations, 2025

   By: YAGAY andSUN

9. Principles of Contemporaneous Import Provisions

   By: YAGAY andSUN

10. Contemporaneous Import Provisions

   By: YAGAY andSUN

11. When the Customs Department invoke the Contemporaneous import provisions to check the undervaluation imports into India?

   By: YAGAY andSUN

News

1. Advisory on Case Insensitivity in IRN Generation

2. China slams US for increasing its defence budget to USD one trillion

3. Public welfare work is centre of Rajasthan govt's budget, no delay in implementation: CM Sharma

4. India's Retail Inflation Hits Six-Year Low

5. Attempt to divert attention from economic crisis: Congress on chargesheet in Herald case

6. Over 1.3 Crore Persons Insured through GeM in FY 2024-25

7. The cumulative exports (merchandise & services) during FY 2024-25 (April-March) is estimated to grow by 5.50% at US$ 820.93 Billion, as compared to US$ 778.13 Billion in FY 2023-24 (April-March)

8. ED should be disbanded, there are other agencies to probe economic offences: Akhilesh

9. CCI approves the acquisition of certain shareholding in SNV Aviation Private Limited (Akasa Air) by PI Opportunities Fund-I Scheme-II (PIOF), certain executives of PIOF, Claypond Capital Partners Private Limited (Claypond), and 360 ONE Private Equity Fund (360 Fund), through its various schemes and affiliates.

10. CCI approves proposed transaction involving Aster DM Healthcare, BCP Asia, Centella and Quality Care India Limited

11. CCI approves the proposed combination involving Waverly Pte. Ltd (“Waverly”), TPG Growth V SF Markets Pte. Ltd (“Growth V”), TPG Growth III SF Pte. Ltd (“Growth III”), Asia Healthcare Holdings Pte. Ltd (“AHH Singapore”), Rhea Healthcare Private Limited (“Rhea”), Asia Healthcare Advisory Holdings LLP (“AHH LLP”), and Asian institute of Nephrology and Urology Private Limited (“AINU”).

12. CCI approves acquisition of shares of TKE Group by Alat Technologies and the formation of joint venture by Alat Technologies and the TKE Group

Notifications

Customs

1. 25/2025 - dated 15-4-2025 - Cus (NT)

Seeks to amend Notification No. 61/94-Customs (N.T.) dated the 21st November, 1994 - Customs airports — Appointment for specified purposes

2. 24/2025 - dated 15-4-2025 - Cus (NT)

Fixation of Tariff Value of Edible Oils, Brass Scrap, Areca Nut, Gold and Silver

DGFT

3. 04/2025-26 - dated 15-4-2025 - FTP

Amendment in Import Policy Condition No. 07 (i) of Chapter - 27 of Schedule-I (Import Policy) of ITC (HS), 2022

GST - States

4. EXN-B(1)-3/2018 - dated 28-3-2025 - Himachal Pradesh SGST

Appoint Additional Commissioner of State Taxes and Excise

5. 09/2025-State Tax - dated 28-3-2025 - Himachal Pradesh SGST

Seeks to bring in force provisions of various rules of Himachal Pradesh Goods and Services Tax (Amendment) Rules, 2024

6. 08/2025-State Tax - dated 28-3-2025 - Himachal Pradesh SGST

State Tax Notification for waiver of the late fee

7. 07/2025-State Tax - dated 28-3-2025 - Himachal Pradesh SGST

Himachal Pradesh Goods and Services Tax (Amendment) Rules, 2025

8. EXN-F(10)-20/2016-Vol-I - dated 27-3-2025 - Himachal Pradesh SGST

Corrigendum-Notification No. 55/2017-State Tax, dated the 15th November, 2017

9. 02/2025-STATE TAX (RULES) - dated 3-4-2025 - Manipur SGST

Manipur Goods and Services Tax (Second Amendment) Rules, 2025

Circulars / Instructions / Orders

DGFT

1. 02/2025-26 - dated 15-4-2025

Amendment in Appendix 2K (Scale of User Charges and Process for Deposit/ Refund of Application Fee/Penalty, etc) of FTP 2023

Highlights / Catch Notes

GST

• Landmark Ruling: Retrospective Tax Amendments Struck Down as Unconstitutional, Protecting Taxpayers from Arbitrary Legislative Overreach

  Case-Laws - HC : HC declared amendments to CGST and KGST Acts unconstitutional, finding retrospective modifications ultra vires the Constitution. The court held that legislative amendments improperly expanded the definition of "supply" and "service" by disregarding the principle of mutuality. The retrospective taxation violated fundamental principles of fairness and Rule of Law, as it imposed unexpected tax burdens on entities without prior notice or opportunity to adjust. The amendments were deemed void, emphasizing constitutional limitations on legislative power to redefine taxation principles retroactively. The judgment reinforced constitutional protections against arbitrary legislative interventions in taxation frameworks.
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• High Court Validates CENVAT Credit Utilization, Affirms Unified Tax Credit Ledger Approach for Electronic Input Tax Reconciliation

  Case-Laws - HC : HC allowed petitioner's challenge regarding CENVAT credit utilization, affirming that input tax credit electronic ledger represents a unified wallet with compartments for IGST, CGST, and SGST. The court referenced prior precedent emphasizing that tax credit eligibility should be assessed based on total wallet balance, not individual compartments. The 3rd respondent was directed to issue fresh orders within two months, consistent with the judicial interpretation, effectively resolving the inadvertent tax credit mismatch between GSTR 3B and GSTR 2A forms.
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• Geometry Compass Box Ruled as Mixed Supply, GST Rate Set at 18% Based on Highest-Taxed Component Under Section 2(74)

  Case-Laws - AAR : The AAR determined that the Geometry Compass Box constitutes a mixed supply under Section 2(74), not a composite supply. The box contains multiple discrete items (compass, divider, scale, protractor, set squares, pencil, eraser, sharpener) which can be independently purchased. Since individual components are commercially available separately, the combination does not qualify as naturally bundled goods. Consequently, the HSN classification falls under Chapter Sub Heading 90178010, with an applicable GST rate of 18%, based on the highest tax-rated item within the package.
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Income Tax

• Legal Win: Interest in Land Acquisition Deemed Capital Gains, Exempt from Tax Under Section 10(37) for Agricultural Lands

  Case-Laws - HC : HC determined that interest received for delayed compensation in compulsory land acquisition qualifies as part of the principal compensation amount. The interest shall be classified as "Capital Gains" under the I.T. Act and eligible for exemption under Section 10(37) if the acquired land is agricultural. The court held that such interest payments are not standalone interest as defined under Section 2(28A), and Section 56 provisions will not automatically apply. The determination depends on the specific factual context of each case. Ultimately, the decision was rendered in favor of the assessee, establishing that statutory interest in property acquisition scenarios should be treated as an integral component of the compensation itself.
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• Transfer Pricing Dispute: Tribunal Modifies Comparable Companies List and Clarifies Investment-Related Tax Assessments

  Case-Laws - AT : ITAT adjudicated transfer pricing and tax assessment matters involving a software services company. The tribunal directed inclusion of Sasken Communication Technologies Ltd in comparable companies list, while excluding Wipro, Tata Elxsi, Infosys, and Larsen & Toubro Infotech due to segmental reporting disparities. On Rule 14A disallowance, the tribunal held that investments from non-interest bearing funds do not warrant interest expenditure disallowance. The tribunal restored the disallowance computation to the Assessing Officer, noting only dividend-yielding investments should be considered. Regarding section 143(1) adjustments, the tribunal advised the assessee to seek remedy through separate proceedings, finding the current forum inappropriate for addressing such grievances.
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• Income Tax Fees from Membership and Share Transfers Ruled as Capital Receipts, Not Revenue Income

  Case-Laws - AT : ITAT adjudicated a dispute regarding the nature of receipt of membership and share transfer fees. The tribunal examined whether these one-time fees constitute capital or revenue receipts. Consistent with prior judicial determinations in preceding assessment years, the ITAT affirmed the assessee's characterization of the fees as capital receipts. The tribunal referenced its previous ruling that such fees do not represent revenue income. Consequently, the appellate tribunal allowed the assessee's appeal, effectively endorsing the treatment of these fees as capital receipts to be credited to the reserve fund, contrary to the Assessing Officer's initial revenue classification.
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• Grandfathered Capital Gains Exemption Upheld: No Adjustment of Losses Against Tax-Exempt Long-Term Transactions Under India-Mauritius DTAA

  Case-Laws - AT : ITAT adjudicated a dispute regarding capital gains taxation, specifically addressing the set-off of non-grandfathered short-term and long-term capital losses against grandfathered long-term capital gains under the India-Mauritius Double Taxation Avoidance Agreement. The tribunal ruled that long-term capital gains from grandfathered transactions under Article 13(4) cannot be adjusted against the assessee's capital losses. The Appellate Tribunal directed the Assessing Officer to grant full exemption for the grandfathered long-term capital gains and permit carry-forward of capital losses to subsequent years in accordance with statutory provisions, ultimately allowing the assessee's appeal.
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• Taxpayer Prevails: Stock Valuation Challenge Dismissed, Section 69C and 115BBE Interpretation Favors Business Records

  Case-Laws - AT : ITAT adjudicated a tax dispute involving undisclosed income and stock valuation. The tribunal rejected the tax authority's attempt to treat stock purchases as undisclosed income under Section 69C. The stocks were found to be properly purchased and accounted for in business records. Regarding Section 115BBE's applicability, the tribunal followed precedent from Madras HC, determining that the amended provisions did not apply to the survey conducted on 29-09-2016. Consequently, the tribunal ruled in favor of the assessee, quashing the revision order by the PCIT and dismissing attempts to impose additional tax on the identified stocks.
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• Revisional Proceedings Under Section 263 Invalidated Due to Lack of Substantial Error and Revenue Prejudice

  Case-Laws - AT : ITAT held that the revision proceedings under Section 263 were invalid. The PCIT failed to establish both essential conditions: the AO's order being erroneous and prejudicial to revenue interests. The tribunal emphasized that Section 263 cannot be invoked to correct every minor error or merely to generate additional tax revenue. The notice issued under Section 263 was deemed void ab initio, as the proceedings fell outside the scope of recorded reasons. Consequently, the order passed under Section 263 was declared legally unsound, and the assessee's appeal was allowed, effectively nullifying the revisional proceedings.
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• Taxpayer Wins on Transfer Pricing Method and SEZ Service Deductions, Tribunal Orders Fresh Assessment and Deduction Restoration

  Case-Laws - AT : ITAT remanded the transfer pricing (TP) adjustment matter relating to support services payment to AO for fresh consideration, finding that TPO erroneously rejected the Transactional Net Margin Method (TNMM) as the Most Appropriate Method (MAM). Regarding Section 10AA deduction for Special Economic Zone (SEZ) services, the Tribunal held that services provided to foreign customers involving warehousing, logistics, and handling qualify under SEZ Act definitions. The Tribunal directed the AO to delete disallowances, noting prior assessments had accepted the deduction's eligibility, and finding the services met statutory requirements for claiming deduction under Section 10AA of the Income Tax Act.
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• Multinational Firms Win Transfer Pricing Battle: TNMM Method Validated, Interconnected Transactions Recognized as Single Economic Unit

  Case-Laws - AT : ITAT adjudicated a transfer pricing dispute involving international transactions. The tribunal found that tax authorities erroneously rejected the Transactional Net Margin Method (TNMM) for determining arm's length pricing. The ITAT held that the disputed transactions were intrinsically linked and should be aggregated, with the assessee's calculated margins of 16.99% being acceptable. The tribunal criticized the tax authorities for arbitrarily segregating transactions without substantive evidence or comparability tests. The decision affirmed that interconnected transactions related to a single product line can be evaluated holistically. Consequently, the ITAT ruled in favor of the assessee, setting aside the transfer pricing adjustments and rejecting the tax department's separate transaction assessment approach.
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• Taxpayer Wins Major Victory: ITAT Strikes Down Income Additions, Validates Loan and Transfer Documentation Under Section 68

  Case-Laws - AT : The ITAT partially allowed the assessee's appeal, directing deletion of several additions and modifications to income calculations. Key outcomes include: (1) commission income restricted to Rs. 7,595 at 0.15% rate, (2) unsecured loan addition under Section 68 deleted based on supporting documentation, (3) surrendered income allowed at normal tax rates, (4) notice under Section 148 quashed due to invalid approval, and (5) bank account credit from share transfer recognized as explained income. The Tribunal found insufficient evidence by the AO to substantiate unexplained income claims and systematically set aside most additions, providing relief to the assessee across multiple contested income components.
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• Unsecured Loans and Share Capital Challenged: Insufficient Evidence Leads to Tax Liability Confirmation Under Section 68

  Case-Laws - AT : The ITAT upheld the addition under Section 68 of the Income Tax Act regarding unsecured loans and share capital. Despite the Assessee's claims of secured loans from banks and share applicant companies' replies, the Tribunal found insufficient evidence to substantiate the genuineness of transactions. The share applicant companies' stereotypical responses and failure to appear before the Assessing Officer, coupled with the Assessee's inability to discharge the burden of proof under Section 68, led to the confirmation of the original addition. The Tribunal dismissed the Assessee's appeal, finding no merit in the grounds presented.
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• Tax Regime Shift Validated: Timely Form 10IE Filing Secures Beneficial Tax Treatment Under Section 115BAC

  Case-Laws - AT : ITAT allowed the assessee's appeal, permitting benefit under New Tax Regime u/s.115BAC. The Tribunal found the Form No.10IE filing valid for A.Y. 2023-24, as submitted prior to the statutory return filing deadline. Despite a belated Form No.10IE for A.Y. 2022-23, the Tribunal followed precedent in Akshay Devendra Birari case, recognizing the assessee's option for the new tax regime. The decision emphasizes that timely option submission for the relevant assessment year determines eligibility for the beneficial tax treatment, effectively granting the assessee relief from the previous denial.
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• Land Distance Valuation Upheld: Proper Inquiry and Documentary Evidence Prevail Against Arbitrary Reassessment Under Section 263

  Case-Laws - AT : ITAT ruled in favor of the assessee, setting aside the Pr. CIT's order under Section 263. The tribunal found that the Assessing Officer (AO) had conducted a proper inquiry and accepted the assessee's documentary evidence regarding the land's distance from municipal limits. The Pr. CIT's attempt to reexamine the issue based on a 2024 Google map verification was deemed inappropriate, particularly given municipal limit changes in 2016. The tribunal emphasized that when the AO has already satisfied himself with the supporting evidence, the CIT cannot remand the matter for fresh adjudication merely due to uncertainty about the claim's correctness.
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Customs

• Container Scanning Protocol Enhances Trade Security with Automated Risk Assessment and Mandatory Examination Procedures

  Circulars : The document establishes a comprehensive Standard Operating Procedure (SOP) for container scanning at Tuticorin Custom House, detailing protocols for import and export container selection, scanning processes, and handling of suspicious containers. The Drive Through Container Scanning System (DTCS) automatically selects containers for scanning based on risk parameters, with mandatory scanning requirements for selected containers. Containers marked "CLEAN" receive a blue "SCANNED OK" stamp, while "SUSPICIOUS" containers undergo 100% examination. Export containers receive priority, with AEO and perishable cargo receiving precedence. Terminal operators, shipping lines, and customs brokers are responsible for ensuring selected containers are scanned, with potential penal actions for non-compliance under the Customs Act, 1962 and Handling of Cargo in Customs Areas Regulations, 2009.
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• Gold Jewellery Seizure Invalidated: Procedural Flaws Breach Natural Justice, Order Quashed for Lack of Due Process

  Case-Laws - HC : HC held that detention of personal gold jewellery was illegal due to procedural irregularities. No Show Cause Notice was issued and no personal hearing was granted, violating principles of natural justice. The Court found the Order-in-Original unsustainable, citing previous judicial precedents that personal jewellery should not be confiscated when procedural requirements are not met. Connected family petitions were similarly directed for release of seized articles. The detention order was quashed, and the petition was disposed of in favor of the petitioner.
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• Procedural Delay Rejected: Appeal Dismissed After Exhausting Permitted Adjournment Opportunities Under Rule 20

  Case-Laws - AT : CESTAT dismissed the appeal for non-prosecution under Rule 20 of CESTAT Procedure Rules, 1982, following Supreme Court precedent condemning mechanical adjournment requests. The tribunal found no justification for adjourning the matter beyond three statutorily permitted instances. The decision underscores judicial intolerance for repeated, unwarranted procedural delays that obstruct efficient case resolution, emphasizing the need for parties to utilize court-granted opportunities responsibly and expeditiously.
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• L-Glutamine with Berries Classification Challenged: Expert Evidence Required Beyond Wikipedia for Accurate Tariff Determination

  Case-Laws - AT : CESTAT remanded the case regarding L-Glutamine with berries classification, finding the Commissioner's (Appeals) sole reliance on Wikipedia insufficient for determining correct tariff heading. The tribunal emphasized that while Wikipedia can be a source material, it cannot be the exclusive basis for goods classification. The appellate authority was directed to re-examine the classification using materials from the show-cause notice and adjudicating authority's original discussion, ensuring a comprehensive and academically rigorous assessment of the product's appropriate tariff categorization.
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• Scrap Vehicle Disposal Deemed Lawful: CESTAT Quashes Customs Duty Demand After Finding No Violation of Exemption Order

  Case-Laws - AT : CESTAT held that the appellant's disposal of two non-motorable vehicles as scrap does not constitute a violation of Ad-hoc Exemption Order No. 336. The tribunal found that: (1) vehicles were no longer usable after 8-12 years of operation in desert conditions; (2) condition prohibiting sale does not apply to scrapped vehicles; (3) Show Cause Notice issued almost 20 years after duty payment is time-barred beyond the five-year limitation period. Consequently, the demand for customs duty, interest, and penalties was set aside, and the appellant's appeal was allowed, effectively quashing the department's claims against the appellant.
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• ATM Monitors Classified as Integral Machine Parts Under CTH 8473, Not General Display Screens, Tribunal Confirms Technical Specificity

  Case-Laws - AT : CESTAT determined that imported ATM monitors are classifiable under CTH 8473 as parts of ATMs, not CTH 8528 as general monitors. The tribunal applied Clause 2(b) classification criteria, recognizing these monitors as specifically designed and principally used with ATM machines. Since the monitors are integral parts of ATMs and not excluded under Note 1, they should be classified under the same heading as ATM machinery (CTH 8472). The revenue's attempt to classify them under a residual entry was rejected. The appellate order set aside the previous classification, allowing the appeal and confirming classification under CTH 8473.
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• Clear Float Glass Classification Resolved: Tribunal Confirms CTH 7005 1090 and FTA Benefits for Importer

  Case-Laws - AT : CESTAT adjudicated a customs classification dispute involving Clear Float Glass. The tribunal determined the imported goods should be classified under CTH 7005 1090, consistent with prior precedent in a similar case involving the same company. The ruling affirmed the appellant's entitlement to Free Trade Agreement (FTA) benefits under Notification No. 46/2011-Cus, subject to regulatory compliance. The tribunal rejected the revenue's classification under CTH 7005 2990 and invalidated the extended period for duty and penalty demands. Consequently, the appeal was allowed, establishing the correct tariff heading and preserving the appellant's customs duty benefits.
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• Imported Projectors with Digital Connectivity Classified Under 8528 6100, Maintaining Consistent Technical Interpretation of Classification Rules

  Case-Laws - AT : CESTAT resolved classification dispute for imported projectors, affirming prior precedent that data projectors with ADP machine connectivity should be classified under CTH 8528 6100. The tribunal confirmed its earlier ruling that projectors with specific ports enabling laptop/ADP machine compatibility qualify for this classification, maintaining consistent interpretation across multiple cases. Based on established jurisprudence in previous appellate decisions, the tribunal allowed the appeal, upholding the appellant's proposed tariff heading classification without substantive deviation from existing legal interpretations.
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Service Tax

• Vehicle Service Station Tax Dispute Resolved: Warranty Charges Exempt, Insurance Commissions Taxable, CENVAT Credit Denied

  Case-Laws - AT : CESTAT adjudicated a complex service tax dispute involving authorized service station services, warranty charges, repair services, incentives, and property rental. The tribunal held that warranty reimbursements from vehicle manufacturers do not constitute taxable service value. Accident repair service demands were confirmed for the normal period. Commissions received from insurance companies and financial institutions were deemed liable under Business Auxiliary Services. CENVAT credit was denied for warranty services. Rental income from immovable property was confirmed for taxation. The tribunal ultimately allowed the appeal, set aside penalties for the normal period, and maintained applicable interest, providing a nuanced interpretation of service tax applicability across multiple service categories.
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• Export Unit Wins Tax Credit Appeal: Documentation Validates Input Service Refund Under Rule 5 of Cenvat Credit Rules

  Case-Laws - AT : CESTAT adjudicated a refund claim for a 100% Export Oriented Unit (EOU), affirming the appellant's entitlement to input service credit. The tribunal determined that the submitted documentation, including export invoices, bank certificates, credit registers, and service tax returns, sufficiently substantiated the refund claim under Rule 5 of Cenvat Credit Rules, 2004. Critically, the tribunal clarified that 'input service' does not mandate a direct nexus between input and output services for EOUs. Procedural technicalities, such as potential CA certificate deficiencies, were deemed insufficient grounds for refund rejection. Consequently, the tribunal allowed the appeal, reinforcing a liberal interpretation of input service credit provisions for export-oriented enterprises.
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• Employers Can Recover Premature Contract Termination Costs Without Tax Liability Under Section Specific Penalty Provisions

  Case-Laws - AT : CESTAT adjudicated a dispute regarding classification of service, specifically addressing bond amounts recovered from employees and students who prematurely terminate employment or educational commitments. The tribunal determined that forfeited amounts from early contract termination do not constitute liquidated damages or declared services. Instead, such recoveries are considered punitive measures designed to discourage disruptive workforce and academic behavior. The penalties serve to deter premature contract abandonment and mitigate potential organizational disruptions. Consequently, the tribunal ruled that these financial recoveries cannot be categorized under declared services, effectively preventing potential tax implications. The appeal was ultimately allowed, establishing a precedent for similar future cases involving contractual penalty mechanisms.
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Central Excise

• Tobacco Packing Machine Duty Calculation Resolved: 4th Proviso Rule 9 Applied, No Additional Levy Required for Ceased Production

  Case-Laws - AT : CESTAT adjudicated a dispute regarding duty calculation for tobacco packing machines. The tribunal determined that the appellant is liable to pay duty under the 4th Proviso of Rule 9 of the Chewing Tobacco and Unmanufactured Tobacco Packing Machines (Capacity Determination and Collection of Duty) Rules, 2010. The court held that duty is payable for the specific period of machine usage, with abatement granted for non-production periods exceeding 15 days. The enhanced duty rate from 17.03.2012 was deemed inapplicable as production had ceased before this date. Consequently, no additional duty demand was sustainable against the appellant, and the appeal was disposed of with the appellant's existing duty payment deemed satisfactory.
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Case Laws:

• GST

• 2025 (4) TMI 872
  Constitutional Validity of levy of GST - Principle of mutuality - Deemed supply of Service - Services rendered by a Club/Association to its members - Running Various Schemes for its members - Amendments made to Sections 2 (17) (e) and 7 (1) (aa) of the Central Goods and Services Tax Act, 2017 (CGST Act) and the Kerala Goods and Services Tax Act, 2017 (KGST Act) are unconstitutional and void for being ultra vires the Constitution of India - Retrospective operation of the amendments - HELD THAT:- Article 246A of the Constitution, that confers simultaneous legislative powers on the Union and the States to make laws with respect to goods and service tax, uses the word supply without giving it an artificial meaning that would take in even a deemed supply . In fact, even by the Constitution [46th Amendment] Act, 1982 when a deeming provision was introduced to bring transactions, that did not fit into the traditional concept of sale of goods, to sales tax, the exercise that was done was to amend the Constitution to deem those transactions as Sales or Purchases . Thus, under Article 366 (29A), a tax on the supply of goods by an incorporated association or body of persons to a member thereof for cash, deferred payment or other valuable consideration, was deemed to be a tax on the sale or purchase of goods . The levy of GST is on the supply of taxable goods or services or both for a consideration. The concept of supply and service as understood under the Constitution and the CGST/SGST Acts (before their amendment) both excluded transactions informed by the principle of mutuality ie. a supply/service from one entity to itself (self supply/self service). Thus, even if there is now a deemed supply , based on the amendments effected to the CGST/SGST Acts, there is no deemed service in circumstances where the service is rendered by a club or association to its members, since the definition of service has not been amended. The concepts of supply and service having been judicially interpreted as requiring at least two persons a provider and a recipient, for inferring their existence, and the Supreme Court having held in Calcutta Club [ 2019 (10) TMI 160 - SUPREME COURT ] that the principle of mutuality has survived the 46th amendment to the Constitution, so long as the said judgment holds sway as a binding precedent and/or the Constitution is not amended suitably to remove the concept of mutuality from the concepts of supply and service thereunder, the impugned amendment to the CGST/SGST Acts must necessarily fail the test of constitutionality. The principle of fairness is one that must inform all actions of a State, including legislation, since it is an essential aspect of the Rule of Law that is recognised as a basic feature of the Constitution. The insertion of a statutory provision that alters the basis of indirect taxation with retrospective effect, so as to tax persons for a prior period when they had not anticipated such a levy and, consequently, had not obtained an opportunity to collect the tax from the recipient of their services, militates against the concept of Rule of Law. On its part, the State too would be found wanting in offering a valid justification for it s legislative action - there are no justification for the retrospective operation of the impugned statutory provisions. Conclusion - The amendments to the CGST and KGST Acts are declared unconstitutional and void. The retrospective application of these amendments was also held to be illegal. Appeal allowed.

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• 2025 (4) TMI 871
  Cancellation of GST registration of petitioner - rejection on the ground of time limitation - vague and non speaking order - order passed without hearing the petitioner - violation of principles of natural justice - HELD THAT:- It appears that after the sad demise of husband of the petitioner - Subi Devi, no care is taken to comply with the provisions of GST Act by the brother-inlaw of the petitioner and no returns were filed and accordingly, no response was also given to the show cause notice issued by the respondent department. Petition disposed off.

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• 2025 (4) TMI 870
  Erroneous availment of CENVAT Credit - mismatch between GSTR 3B and GSTR 2A - Petitioner contends that the inadvertent error while availing ITC under a wrong heading was a human error and since there was no facility for revising the forms, petitioner utilized the IGST credit available - HELD THAT:- Division Bench of this Court had, in Rejimon Padickapparambil Alex v. Union of India and others [ 2024 (12) TMI 399 - KERALA HIGH COURT] held, after referring to the clarification issued by CBIC by its Circular No.192/04/2023 dated 17.07.2023 that the input tax credit available in the electronic credit ledger should be considered as a pool of funds designated for different types of taxes such as IGST, CGST and SGST. It was further observed that these accounts would represent a wallet with compartments for IGST, CGST and SGST funds and the entire wallet has to be taken into consideration, not just individual compartments. It was also observed that for utilizing the IGST liability, the clarification emphasizes that the eligibility of funds for this payment is based on the total balance in the entire wallet and not just one of the compartments. The Division Bench went on to hold that Section 73 of the Act is attracted only when there is tax not paid or short paid or erroneously refunded or where an input tax has been wrongly availed or utilized for any reason. As far as the grievance and apprehension expressed by the State in that case was concerned that it might be deprived of its legitimate share of the IGST made by supplies outside, the Division Bench made it clear that the State on producing a copy of the judgment with a representation before the GST Council, appropriate directions to solve the issue by taking note of the declaration in the judgment shall be carried out. The 3rd respondent is directed to pass fresh orders within two months, in the light of the decision in Regimon Padickapparambil Alex - petition allowed.

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• 2025 (4) TMI 869
  Classification of goods - HSN code - Geometry Compass Box supplied by the Applicant to BMC - GST rate at which the supply should have been made - HELD THAT:- The goods supplied includes a metal box inside which various articles such as compass, divider, scale, protractor, set squares, pencil, eraser and sharpener are supplied. It is seen that the customer i.e. BMC in this case, pays a single amount for the said goods, thereby fulfilling the condition that the customer pays one single price for the entire package. It is also well known in commercial and general parlance by the customer that a Geometry Box will contain certain instruments used for drawing such as Compass, divider, scale, protractor and set square. In the instant case, in addition to the aforesaid items, the applicant is also supplying a pencil, an eraser and a sharpener in the said box. Such items are not normally advertised as a ORITY * package. Further, it is common knowledge that the customer can purchase a compass, a divider, a scale, a protractor, set squires, pencil, eraser and sharpener separately and the said items are sold separately in the market by various suppliers. Therefore, the fact that the goods are available separately, mitigates the assumption that the goods supplied by the applicant can be termed as a composite supply . By applying the aforementioned principles and guidelines to examine whether the goods provided by provided by the applicant can be considered as naturally bundled, in a Geometry Box, we find that such services are not naturally bundled with each other in the ordinary course of business. Each individual items can be purchased separately and the specific combination of goods supplied in the geometry box by the applicant is not a combination which can be termed as naturally bundled and sold in the commercial market. Therefore, this combination cannot be treated as naturally bundled in the ordinary course of business. Since the combination of goods sold by the applicant cannot be treated as a composite supply, the goods sold by the applicant will be considered to be a mixed supply involving supply of various goods. Conclusion - i) The Geometry Compass Box supplied by the applicant to BMC amounts to mixed supply u/s. 2 (74) and is appropriately classifiable under Chapter Sub Heading 90178010, being HSN of the goods that attracts highest rate of tax. ii) The rate of GST applicable would be 18%.

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• Income Tax

• 2025 (4) TMI 868
  Validity of Notices u/s 153C - absence of incriminating material specific to those AYs - HC quashed the impugned notice issued u/s 153C of the Act and all consequential proceedings arising therefrom - HELD THAT:- Revenue has fairly submitted that similar Special Leave Petitions, arising out of the common impugned order Saksham Commodities Limited, Modicare Limited, Susheel Jain, Vikas Wahi, Mamta Agarwal, Ashutosh Agarwal, Naresh Mittal, Forever Body Care Industries, Ashish Agrawal, Satya Pal Arya, Sunoj Engineers Pvt. Ltd., Opv Packaging Pvt. Ltd., Chander Parkash Gupta, Neelkanth Steel And Alloys [ 2024 (4) TMI 461 - DELHI HIGH COURT ] passed by the High Court of Delhi at New Delhi, have already been dismissed by this Court. Special Leave Petitions are dismissed.

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• 2025 (4) TMI 867
  Taxability of amounts received by an assessee as compensation or enhanced compensation for compulsory acquisition of his landed property - Whether the interest received qualifies for exemption u/s 10(37) if the land acquired is agricultural land? - HELD THAT:- The developed jurisprudence on property rights therefore unambiguously points to the necessity of treating interest payments for delayed payment of principal compensation amounts for compulsory acquisition of property, as an accretion to the compensation amount itself. For a citizen whose property has been compulsorily acquired by the State, the right to receive the compensation in full accrues from the date of his dispossession and any statutory interest paid to him for delayed payment of the principal compensation amounts partakes the character of the compensation itself. This is irrespective of whether the interest that is paid is u/s 28 or Section 34 of the LAA because the interest payments under both of the said provisions are premised on the same rationale [See: The constitution bench decision in Sundar v. Union of India [ 2001 (9) TMI 1121 - SUPREME COURT ]. We hold that interest amounts received by an assessee in respect of delayed payment of compensation under the LAA will be treated as accruals to the principal compensation amount and be classified as Capital Gains for the purposes of the I.T. Act. Consequently, the interest amounts will also get the benefit of Section 10 (37) of the I.T. Act if the land compulsorily acquired is agricultural land. Since the interest amounts so received are not in the nature of interest as defined under Section 2 (28A), the provisions of Section 56 of the I.T. Act will not be attracted in such cases. While the provisions of Section 56 (2) (viii) deal with interest on compensation or enhanced compensation, the said reference to compensation or enhanced compensation need not be seen as made in connection with compulsory acquisition of property. The applicability of Section 56 (2) (viii) will depend upon whether or not, in the particular factual situation, the interest amount can be treated as different in nature from the principal compensation amount. Decided in favour of assessee.

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• 2025 (4) TMI 866
  Direction to CIT(A) to decide an appeal long pending - HELD THAT:- The petitioner has drawn attention to an earlier order dated 10.03.2025 passed by this Court in Perfetti Van Melle India Pvt. Ltd. vs. Union of India Others [ 2025 (4) TMI 612 - PUNJAB AND HARYANA HIGH COURT] wherein, it was observed by this Court that the appeal was filed in the year 2015 i.e. almost about 10 years back and was not decided, which forced the petitioner therein to file CWP where this Court was constrained to issue directions for disposal of the appeal that had been pending for nearly a decade within a period of six months. In the present writ petition, again the petitioner filed the appeal in the year 2020 i.e. 5 years back and till date, there is no progress. Therefore, in view of the above, the present writ petition is disposed of with a direction to respondent No.2-The Commissioner of Income Tax-3 (Appeals), to decide the appeal filed by the petitioner within a period of three months from the date of receipt of copy of this order. All the pending application(s), if any, also stand disposed of.

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• 2025 (4) TMI 865
  Reopening of assessment u/s 147 - limitation prescribed under amended Section 149 - HELD THAT:- First proviso to Section 149 prohibits issuance of a reassessment notice under the new regime if such notices have become timebarred under the old regime. Therefore, the last date for issuance of Notice under Section 148 of the Act would have expired on 30.06.2021, as per the third Proviso 149(1)(b) of the Act as in force with effect from 01.04.2021. The time during which stay was in operation or the time during which, the assessee took time to file the reply, the Notice issued u/s 148 (A)(b) of the Act stands expelled. In this case, the reply itself was filed by the petitioner only on 31.05.2022, pursuant to which the Impugned Order was passed on 30.06.2022 u/s 148(A)(d) of the Act and Notice u/s 148 of the Act was issued. Though the limitation for issuance of a Notice u/s 148 of the Act under the old regime would have expired on 31.03.2024, a reading of conclusion in decision in Union of India Vs. Rajeev Bansal [ 2024 (10) TMI 264 - SUPREME COURT (LB) ] however indicates that the Impugned Notice dated 30.06.2022 has to be treated as having been issued beyond the limitation period. WP deserved.

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• 2025 (4) TMI 864
  TP Adjustment - comparable selection - Inclusion of Sasken Communication Technologies Ltd - HELD THAT:- A perusal of financial statement shows that segmental information is available with regard to revenue of the company. A perusal of segmental profit and loss statement shows that the company has shown revenue from two segments i.e. Software Services and Software Products. Likewise segmental profits from Software Services and Software Products are also reflected in the segmental statement of profit and loss account of the company. Considering directions of the DRP and the fact that segmental information is available, we find merit in the submissions of the assessee. Ergo, Sasken Communication Technologies Ltd. is directed to be included in the final list of comparables. Wipro - Considering, lack of availability of segmental information and a substantial difference in brand value of the company, we are of considered view that Wipro Ltd. is not a good comparable to the assessee/appellant. Tata Elxsi is directed to be excluded from the list of comparables as services rendered by Tata Elxsi Ltd. under service segment are not comparable to the assessee which is providing software development service to its AE s as captive service provider. Infosys Ltd company has reported segmental profitability under the heads financial services, manufacturing, energy and utilities, communications and services, retail, consumer packaged goods and logistics, life sciences, healthcare insurance and combined revenue of all other segments. There is no segmental data available for Software Development Services. Therefore, in our considered view Infosys Ltd. cannot be considered as good comparable of the assessee. Functional disparity is evident from segmental reporting. Larsen Toubro Infotech Ltd - Segmental data available in public domain is not sufficient to compare revenue in the relevant segment of Software Development. Hence, the said company is not a good comparable to the assessee company. Hence, the same is directed to be excluded from list of comparables. Disallowance u/s. 14A r.w.r 8D - contention of assessee is that during the period relevant to assessment year under appeal, the assessee has earned tax free dividend income by way of dividend on Mutual Funds and no exempt income has been earned from investments in subsidiaries - HELD THAT:- It is a well settled law, that where assessee is having mixed bag of own interest free funds and interest bearing borrowed funds , it shall be presumed that investments are made from assessee s own non-interest bearing funds. The assessee is having sufficient non-interest bearing funds to cover investment made in Mutual Funds. Hence, no disallowance with regard to interest expenditure under Rule 8D(2)(ii) is warranted. [Ref: CIT vs HDFC Bank Ltd. [ 2014 (8) TMI 119 - BOMBAY HIGH COURT ] The assessee has also made investments in subsidiaries, however, no exempt income has been earned on such investments. Thus, for disallowance under Rule 8D(2)(iii), aforesaid investments cannot be taken into account. The Special Bench of Tribunal in the case of Assistant CIT vs. Vireet Investments (P) Ltd. [ 2017 (6) TMI 1124 - ITAT DELHI ] has held that for the purpose of making disallowance Rule 8D(2)(iii), only dividend yielding investments are to be considered.We deem it appropriate to restore this issue back to the AO for re-computation of disallowance under Rule 14A r.w.r. 8D in light of above observations. In the result, ground no. 4 to 7 of appeal are allowed for the statistical purpose. Adjustment made in the income returned by the assessee in intimation issued u/s. 143(1) of the Act and short credit of TDS - HELD THAT:- The assessee s grievance against adjustments made u/s. 143(1) cannot be redressed under the present proceedings. The assessee has to seek remedy available under the Act in separate proceedings against adjustment made u/s. 143(1) of the Act. We find that though the assessee has preferred rectification application before the CPC / AO but has not received any plausible reply / order. We are of the considered view that the remedy is available elsewhere and as the assessee has triggered the available remedy it would be appropriate to consider the remedy there. In our humble opinion, the remedy sought by the assessee is not available from this forum as per the relevant provision of the Act.

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• 2025 (4) TMI 863
  Revision u/s 263 - AO had not inquired into two issues on applicability of section 43CA regarding the sale of land below market value and the capitalization of interest costs - HELD THAT:- It is an admitted fact that the assessee had sold the land at Survey No.24 for a consideration less than the market value adopted for stamp duty purposes for which the provisions of section 43CA of the Act are squarely applicable. Although there is a difference as per the provisions of section 43CA of the Act of Rs. 38,32,312/-, the assessee had offered only an amount of Rs. 3,05,475/- and the Assessing Officer has not bothered to inquire about the same. Similarly, the issue relating to the addition of interest of Rs. 1,52,87,640/- to the cost of land despite debiting such interest as finance cost in the Profit and Loss Account remained to be examined by the AO. A perusal of the assessment order shows that it is a very brief order without touching the two vital issues pointed out by the Ld. PCIT. As in the case of Vedanta Ltd [ 2020 (12) TMI 89 - BOMBAY HIGH COURT] has held that where the assessment was completed without proper inquiries, the Commissioner was competent to invoke revisional jurisdiction and direct the Assessing Officer for fresh assessment. We find in the case of Rampyari Devi Saraogi [ 1967 (5) TMI 10 - SUPREME COURT] has held that where the Assessing Officer had concluded the assessment in undue hurry by passing a short, stereotyped assessment order, without making any inquiries, the CIT is justified in revising the order u/s 263 of the Act. Decided against assessee. Revision u/s 263 - Addition u/s 69C r.w.s. 115BBE - When the AO had raised specific queries on an issue and the assessee had given the reply to the same and the AO after considering the reply of the assessee has passed the order, then the order cannot be set aside by the Ld. PCIT by invoking jurisdiction u/s 263 of the Act since it is not a case of lack of enquiry or no enquiry but at best may be inadequate enquiry. Since the AO in the instant case has raised specific queries regarding the issues pointed out by the Ld. PCIT and the assessee had replied to the same and the AO after considering the reply of the assessee has accepted the submissions made by the assessee, therefore, it is not a case of lack of enquiry and therefore, is not a fit case for invoking the jurisdiction u/s 263 of the Act. We, therefore, set aside the order passed by the Ld. PCIT and allow the grounds raised by the assessee.

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• 2025 (4) TMI 862
  Nature of receipt - Nominal Membership fees and Share Transfer fees received one time - Capital Nature or Revenue nature - HELD THAT:- AO has treated the amount as Revenue receipt but the assessee treated the B-Class Fees, Member Share Entrance and Admission Fees received for one time from Members as Capital Receipt and credited it to Reserve Fund. We find that in the preceding years, i.e. A.Ys. 2009-10, 2012- 13, 2013-14 and 2014-15 also similar issue was raised and this Tribunal [ 2021 (1) TMI 1349 - ITAT PUNE] held that the fee received by the assessee does not constitute Revenue Receipt. Appeal of the assessee is allowed.

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• 2025 (4) TMI 861
  Addition u/s 68 - rejection of claim u/s 10(38) on sale of listed equity shares - bogus share transactions - HELD THAT:- We observed that the issue involved in the present case is exactly similar to the case of high court Vipin Jain [ 2024 (3) TMI 1433 - DELHI HIGH COURT] individual decided the appeal in favour of the assessee wherein the scrip of Alps Motor Finance Ltd. was involved, which is also involved in the present case whwewin held notably, it is seen from the impugned order that the AO has failed to corroborate its conclusions on the basis of any cogent material available on record before forming an opinion that the sale transaction was sham and a pre-planned arrangement to claim exemption under the guise of LTCG. An upshot of the above findings of the ITAT, coupled with the fact that no irregularity was highlighted by the Securities and Exchange Board of India pertaining to the transaction of the scrips of the Company, would lead us to the conclusion that there is nothing adverse against the respondent-assessee which could establish a fictitious LTCG to claim exemption at the behest of the respondent-assessee. Rather, the arguments put forth by the Revenue are mere findings of fact. In any case, the issues raised by the Revenue in the present appeals already stand covered by the decision of this Court in the case of PCIT v. Krishna Devi [ 2021 (1) TMI 1008 - DELHI HIGH COURT] wherein, under similar facts and circumstances, it was held that the preponderance of probabilities cannot be a ground to reject the evidence put forth by the parties. Assessee appeal allowed.

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• 2025 (4) TMI 860
  Setting off of the non-grandfathered (taxable) short-term and long-term capital losses against the grandfathered (exempt) long-term capital gains - HELD THAT:- Long-term capital gains earned by the assessee from the transactions, which are grandfathered as per the provisions of Article 13(4) of the India-Mauritius DTAA, cannot be adjusted against the long-term and short-term capital losses incurred by the assessee. Accordingly, the AO is directed to allow the exemption of the entire long-term capital gains earned by the assessee from the transactions which are covered under the provisions of Article 13(4) of the India-Mauritius DTAA. AO is directed to allow the carry forward of long-term and short-term capital losses incurred by the assessee to subsequent years as per the provisions of the Act. Appeal by the assessee is allowed.

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• 2025 (4) TMI 859
  Revision u/s 263 - AO failed to examine the allowability of Provision for Loans to Joint Venture (MGCL) and Impairment Loss HELD THAT:- We wish to clarify that at this stage, we are not adjudicating the allowability of the said claims on merits. The revisionary order passed u/s 263 of the Act merely directs the AO to examine these claims afresh and frame a reasoned assessment after proper verification. Therefore, no finding is being recorded by us on the applicability of the judicial precedents cited by the AR or the correctness of the assessee s claim under section 37(1) of the Act or any other provision. The allowability or otherwise of these claims shall be determined by the AO in accordance with law, after considering the submissions and evidence placed before him during the remand proceedings. We are of the considered view that the assessment order is vitiated due to complete absence of inquiry on two material items having a substantial bearing on the determination of taxable income under the normal provisions of the Act. The explanations and accounting entries now furnished by the assessee were not subjected to verification during the original assessment and hence do not cure the error at the stage of revision. PCIT was justified in invoking section 263 and directing the AO to reframe the assessment after examining the nature and allowability of the impugned items. The revisionary order is valid in law and does not suffer from any jurisdictional or procedural infirmity. Appeal of the assessee is dismissed.

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• 2025 (4) TMI 858
  Addition made u/s 68 on account of bogus share premium - addition made towards share capital and premium from two parties - HELD THAT:- For the infusion of fresh funds, source of source was explained which has been accepted by the ld. AO in the remand proceedings as stated in the report. Furthermore, these investing companies are based at Mumbai and not from Kolkata, which was evidently demonstrated by the assessee by furnishing their details from the MCA portal. Considering the above stated facts duly supported by corroborative documentary evidences which have been accepted and verified by AO in the remand proceedings and nothing otherwise brought on record before us to controvert the same, we find that assessee has discharged its onus casted u/s 68 of the Act. Accordingly, we find no reason to interfere with the findings arrived at by the ld. CIT(A) on this issue whereby addition has been deleted. Grounds raised by the revenue in this respect are dismissed. Addition of gross profit estimated on understated sales - No justification on the part of ld. Assessing Officer of doubling the figure found in the profit and loss account on the date of survey to extrapolate it for the whole year and reject the books of account to apply gross profit percentage on such an extrapolation which is baseless. There cannot be any comparison of sales between pre and post survey period to extrapolate in such a linear proportion. Such a mathematical approach based on presumption cannot lead to determination of actual and real income for bringing it to tax under the Act. It is a settled law that no addition can be made on the basis of suspicion and guess work. The very foundation of rejecting the books of account of the assessee fails owing to fallacious approach of ld. AO. Thus, AO has erred in rejecting the books of account and thereby estimating the business income of the assessee by extrapolating the figures. Nothing is brought on record before us to controvert the fact-based findings arrived at by the ld. CIT(A) on this issue. Book results disclosed by the assessee in its audited financial statements and business income thereby reported in the return of income is to be accepted. Accordingly, no reason to interfere with the observations and findings of ld. CIT(A) whereby addition has been deleted. Grounds raised by the revenue in this respect are dismissed.

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• 2025 (4) TMI 857
  Addition u/s.68 - long term capital gain earned on sale of listed shares on rejecting the appellant s claim of exemption u/s 10(38) denied - AO disallowed the entire Long-Term Capital Gain (LTCG) on the grounds that there was a substantial price increase, approximately 200% - HELD THAT:-As reflected in the balance sheet as of 31st March 2012, the assessee had investments in equity shares and mutual funds amounting to Rs. 2,22,59,604/-, which increased to Rs. 4,31,76,951/- as of 31stMarch 2013. This indicates consistent investment activity in the equity market. Importantly, the documents submitted by the assessee during the assessment proceedings were neither challenged nor discredited by the Revenue authorities. Therefore, the assessee has discharged the primary onus of proving the genuineness of the transactions. Furthermore, confirmations from the stock brokers are placed on record. The LTCG proceeds were received by the assessee through regular banking channels. The purchased shares were credited to the assessee s demat account, and the entire transaction was routed through the BSE. No evidence has been brought on record by the Revenue to demonstrate that the assessee was involved in any price manipulation or rigging with respect to the shares of KDJ. We also note that the co-ordinate bench of the ITAT has taken a similar view in relation to the same scrip, KDJ , in favour of the assessee. Accordingly, we respectfully rely on the decisions of of Mrs. Karishma Ajay Agarwal [ 2023 (8) TMI 136 - ITAT MUMBAI] and Manoj Kumar Agarwal [ 2024 (8) TMI 1553 - ITAT MUMBAI] . A similar view was also taken by the ITAT in the case of ITO vs. Jimeet Vipul Modi [ 2021 (8) TMI 110 - ITAT MUMBAI] The additions made by the Ld. AO under Section 68 on account of LTCG, and under Section 69C on account of alleged commission, are hereby deleted. Decided in favour of assessee.

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• 2025 (4) TMI 856
  Foreign Tax Credit (FTC) u/s 90/91 denied - form No.67 was not filed by the assessee alongwith the return of income filed u/s 139(1) - whether Rule 128 of the Income Tax Rules,1962, as being directory in nature? - HELD THAT:- No infirmity in the order of the Ld. CIT(A) allowing assessee s rectification application seeking claim of foreign tax credit by way of belated filing of Form No. 67, holding the requirement of Rule 128 of the Rules, of filing Form 67 alongwith return of income filed u/s 139(1) of the Act, as directory. Assessee appeal allowed.

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• 2025 (4) TMI 855
  Addition of undisclosed income as per the provisions of Section 69C r.w.s. 115BBE - HELD THAT:- In the Income Tax Return also, it was shown separately for fair and transparent disclosure only. But in the computation of income, the same is forming part of normal business income under the profit and gains of business. Thus, the disclosure of sum in the Profit and Loss and ITR by no means can leave to a conclusion, that there is some unexplained or undisclosed income which has been invested in stocks. Therefore, AO accepted the above 30 lakhs as business income and made addition which was not offered to tax by the assessee in the regular assessment. Further it is a fact that the stocks physically found in the premises were out of purchases duly accounted in books, identified with purchase bills and value was also determined based on the same which are already on record. Thus, there is no case of any investment in stocks out of undisclosed sources. But the contention of the Ld. CIT to treat the same undisclosed income u/s. 69C of the Act also not valid in law. Since section 69C deals with incurrence of expenditure for which source is not explained or the explanation offered is not to the satisfaction of the A.O. In the instant case, there is no issue of unexplained expenditure because the excess stock found was out of purchases duly accounted for in the books. Thus the question of invocation of Section 69C does not arise in the facts of the present case. Applicability of provisions of Section 115BBE - Amendment to Section 115BBE of the Act substituting a higher rate of 60% for the erstwhile 30% was made with effect from 15-12-2016 and therefore the contention of the assessee is said that the amendment is not applicable in its case, as the disclosure was made during the survey on 29-09-2016. Per contra the contention of the PCIT is the amended provisions of section 115BBE of the Act are applicable w.e.f. 01-04-2017 i.e. from the A.Y.2017-18 and accordingly applicable from 01-04-2016. Undisputedly survey action taken place in the business premises of the assessee on 29-09-2016 and the alleged unaccounted stocks purchased from 01-04-2016 till the date of survey. Thus, respectfully following the above Judgement of the Madras High Court S.M.I.L.E Microfinance Limited. [ 2024 (11) TMI 1444 - MADRAS HIGH COURT] there is no question of invoking provisions of section 115BBE of the Act. Thus the grounds of appeal of the assessee on the issue of Section 115BBE of the Act is hereby allowed and the revision order passed by Ld.PCIT is hereby quashed. Decided in favour of assessee.

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• 2025 (4) TMI 854
  Addition on account of gift from mother - HELD THAT:- Addition has been made by the ld. AO on account of gift received from the mother, which was duly depicted in the balance sheet of the assessee. During the course of hearing the assessee filed a gift deed dated 15.01.2008, which is signed by the mother of the assessee and witnessed by the Gopal Das Rathe. In the gift deed, it was stated that the gift was made out of the personal saving of the mother and handed over to the assessee which was accepted by the assessee out of love and affection. We are inclined to accept the same without restoring the issue either to CIT (A) or ld. AO by considering the smallness of amount involved as the restoration would unnecessary waste of time and resources of the department. Disallowance made u/s 57 - assessee has claimed expenses from interest received from the bank and others under the head expenses and interest - AO disallowed 40% on estimated basis thereby making disallowance - HELD THAT:- The claim of the assessee has been rejected on estimated basis at the rate of 40% by the AO without there being any basis for such estimation and disallowance. In our opinion, even if the assessment is framed u/s 144 of the Act even then the AO has to made the assessment on reasonable and comparable basis but in the present case, the ld. AO has not given any reason for the same and so was done by the ld. CIT (A). Considering these facts and circumstances, we are inclined to set aside the order of ld. CIT (A) and direct the ld. AO to delete the addition. The appeal is allowed.

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• 2025 (4) TMI 853
  Addition being 50% of the receipt of interest on enhanced compensation - to be taxed as income from other sources u/s 56(2)(viii) or if it is exempt from income tax as part of the compensation under the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 (RFCTARR Act, 2013) - HELD THAT:- According to section 96 of RFCTARR Act, 2013, the interest received towards delayed payment of compensation for compulsory acquisition of land is exempted from income tax by virtue of enactment of the RFCTARR Act. As per section 3(i) of RFCTARR Act provides cost of acquisition includes amount of compensation which includes solatium any enhanced compensation ordered by the Land resettlement Authority or the Court and interest payable thereon and any other amount determined as payable to the affected families by such Authority or Court. Therefore, the interest awarded by the authority on the enhanced compensation on compulsory acquisition of land is part of the compensation and hence, not taxable under the Income Tax Act by virtue of provisions containing under section 10(37) of the Act. We find that in the case of CIT v. Ghanshyam (HUF) [ 2009 (7) TMI 12 - SUPREME COURT] wherein held that interest paid under section 28 of the Land Acquisition Act forms part of compensation and is a part of enhanced value of the land . The Hon ble Gujarat High Court in the case of Movaliya Bhikhubhai Balabhai [ 2016 (5) TMI 488 - GUJARAT HIGH COURT] held that interest forms part of compensation and the same is not taxable. Therefore, we are of the view that these two judgements are rendered in consonance with the provisions of section 3(i) of new RFCTARR Act, 2013, which defines the term compensation, which includes interest, if any, payable under the said Act. Hence, AO as well as the ld. CIT(A) are not justified in making addition u/s 56(2)(viii) on the receipt of enhanced interest received by way of enhanced compensation for compulsory acquisition of land. Thus, the order of the CIT(A) is set aside and delete the addition made by the Assessing Officer. Thus, the grounds raised by the assessee are allowed.

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• 2025 (4) TMI 852
  Revision u/s 263 - Whether the deductions allowed u/s 36(1)(vii) for bad debts and depreciation on shifting of investments - HELD THAT:- Admittedly, the assessment order does not specify the enquiries conducted by the Ld.AO however, multiple notices were issued by the AO to enquire about both issues that is the subject matter of consideration in the 263 proceeding. Further from the details filed by the assessee in response, it is clear that the computation of the claim has been properly looked into by the Ld.AO. Therefore this cannot be treated to be a case of no enquiry or inadequate enquiry. We now refer to the decision of Malabar Industrial Co. Ltd. [ 2000 (2) TMI 10 - SUPREME COURT] the prerequisite for the exercise of jurisdiction by the CIT under section 263 is that, the order of the AO must be erroneous in so far as it is prejudicial to the interests of Revenue. PCIT has to be satisfied of twin conditions, namely order of the AO sought to be revised is erroneous, and it is prejudicial to the interests of the Revenue. If one of them is absent i.e; if the order of the AO is erroneous, but is not prejudicial to the revenue or if it is not erroneous, but is prejudicial to the interest of the revenue, recourse cannot be had to section 263(1) of the Act. It was further held that, the provisions of section 263 cannot be invoked to correct each and every type of mistake or error committed by the AO. As in case of Jamnadas T. Mehta [ 2001 (12) TMI 223 - ITAT PUNE] it was held that, the ambit of interference under section 263 is not to set aside merely unfavourable orders and bring to tax some more money to the treasury. The section is not enacted to get a sheer escapement of revenue which is taken care of in other provisions of the Act. Prejudice that is contemplated u/s 263 is the prejudice to the income-tax administration as a whole. Section 263 is to be invoked not as a jurisdictional corrective or as a review of a subordinate s order in exercise of the supervisory power, but it is to be invoked and employed only for setting right distortions and prejudices to the revenue, which is a unique conception, which is to be understood in the context of and in the interests of the revenue administration. No merit in the present proceedings initiated against the order u/s.143(3) on an issue that falls outside the scope of reasons recorded. We therefore of the opinion that the notice issued u/s. 263 is void-ab- initio as a consequence of which the order passed u/s. 263 has to be declared to be bad in law. Appeal filed by the assessee stands allowed.

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• 2025 (4) TMI 851
  Denial of grant of registration u/s 12A and approval u/s 80G - assessee s failure to respond to a notice seeking clarification on discrepancies in the initial application - HELD THAT:- Considering submission of assessee that due to the mistake of the employee of the trust, those details could not be filed and that given an opportunity, the assessee is in a position to substantiate its case by filing the requisite details before the CIT(E) to his satisfaction. Considering the totality of the facts of the case and in the interest of justice, we deem it proper to restore the issue to the file of the CIT(Exemption) with a direction to grant one final opportunity to the assessee to substantiate its case by filing the requisite details to his satisfaction and decide the issue as per fact and law. The grounds raised by the assessee are accordingly allowed for statistical purposes.

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• 2025 (4) TMI 850
  Rejecting the application for registration u/s 80G(5)(i) - alleged failure of the Trust to provide necessary details and justify the genuineness of its charitable activities - HELD THAT:- We find that the ITAT has set aside the issue of rejection u/s 12A to the file of the CIT(E) for fresh adjudication. We are, therefore, of the considered opinion that as the issue of registration u/s 80G being coterminous with the issue of registration u/s 12A the issue u/s 80G should also be set aside to the file of the CIT(E) for consideration afresh. CIT(E) shall afford reasonable opportunity to the assessee and examine the evidences filed by the assessee to adjudicate the issue of registration u/s 80G. Assessee are allowed for statistical purposes.

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• 2025 (4) TMI 849
  Addition u/s. 68 on account of bogus loan - assessee is one of the beneficiaries of the bogus loan - HELD THAT:- We are of the considered view that the assessee has failed to prove the creditworthiness of P.Saji Textiles Ltd and Dolex Commercial Private Ltd from whom the assessee received the loan amount during the year under consideration. Consequently, we are of the considered view that the payment made by the assessee to P.Saji Textiles Ltd claimed to be the repayment of a loan also has no basis. Thus, we do not find any merits in the findings of the CIT(A) in holding that the assessee has discharged its primary onus of proving the nature and source of the sum credited in its books of account. Accordingly, the addition made by the AO u/s 68 of the Act in respect of the sum received from P.Saji Textiles Ltd and Dolex Commercial Private Ltd is sustained. Since the assessee failed to satisfactorily prove the nature and source of the sum credited in its books of account, therefore, we do not find any basis in the payment made by the assessee to P.Saji Textiles Ltd. Accordingly, the addition made by the AO concerning the amount paid by the assessee to P.Saji Textiles Ltd is upheld. Payment to Jagvi Developers Ltd by the assessee, it is the claim of the assessee that it has advanced the loan to the aforesaid entity out of the money received from Parasrampuria Plantation Ltd. and Gokuldhma Yashodham Dev. Pvt. Ltd. - From the perusal of the financial statements of the assessee, we find that for the year under consideration as well as in the preceding year, the assessee earned Nil revenue from operations. It is further pertinent to note that the only expenditure incurred by the assessee pertains to depreciation on fixed assets, which are nothing but air conditioner, furniture and fixtures, filing fees, bank charges, statutory auditor fees and tax audit fees. As from the perusal of the bank statement of the assessee, it is evident that as soon as the assessee received any amount from any entity the same was transferred to another entity, and there is no sufficient balance in the bank account of the assessee. Therefore, we agree with the findings of the AO that the assessee had no sufficient balance in its bank account to advance the fund to Jagvi Developers Ltd. Thus, we are of the considered view that merely because the AO has invoked the provisions of section 69 of the Act for making the addition been paid by the assessee to Jagvi Developers Ltd, however, the same does not absolve the assessee from explaining the amount shown as loan to Jagvi Developers Ltd., since the amount transferred to Jagvi Developers Ltd is not supported by the financial capacity of the assessee, more so in the absence of duly signed loan confirmation from Jagvi Developers Ltd. In this regard, we placed reliance upon the decision of the special bench of the Tribunal in Manoj Aggarwal [ 2008 (7) TMI 446 - ITAT DELHI-A] . We are of the considered view that mere recording of the transaction in the books of account without any financial capacity is just an empty formality to overcome the rigours of section 69 of the Act. Therefore, the mere fact that the transaction was through banking channel does not render the same to be genuine. Accordingly, we sustained the addition made by the AO with respect to Jagvi Developers Ltd.

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• 2025 (4) TMI 848
  TP Adjustment - selection of MAM - TPO has accepted the TNMM method followed by the assessee in other 9 kinds of International transactions - HELD THAT:- In the present facts and circumstances of the case and relying on the decision of this Tribunal in assessee s own case for the A.Y. 2010-11 [ 2022 (9) TMI 242 - ITAT CHENNAI] , we are of the considered view that the lower authorities have erred in rejecting TNMM method as MAM relating to the support services payment made by the assessee to AE and hence we remit this issue to the file of the AO for fresh consideration. Disallowance of deduction u/s. 10AA - nature of services provided by the assessee from its SEZ unit - HELD THAT:- Services provided to the foreign customers located outside India, in the nature of warehousing, logistics and handling services shall squarely fall within the ambit of services as defined under section 2(z) of the SEZ Act read with Rule76 of the SEZ Rules. We note that the assessment for the AY 2010-11 was concluded, by allowing the deduction u/s. 10AA of the Act by disputing only the quantum of deduction. Further, pursuant to the assessment order passed for the AY 2012-13, the eligibility to claim deduction under section 10AA of the Act for the AY 2010-11 was directed to be re-examined in the order passed under section 263 of the Act. Thereafter, in the assessment order passed under section 143(3) r.w.s 263 of the Act, the AO only disputed the quantum of deduction and the eligibility to claim deduction under section 10AA of the Act was accepted by the AO. Further, during the course of assessment proceedings for the AY 2017-18, the AO had sought specifically for details pertaining to the deduction claimed under section 10AA of the Act, inter-alia including eligibility of the claim and passed an order accepting the claim of deduction u/s. 10AA of the Act without recording any adverse findings. In light of the above discussions, the deduction claimed by the assessee u/s. 10AA of the Act is allowable and hence we are of the opinion that the AO and that of the ld.CIT(A) have erred in disallowing the deduction. Therefore, direct the AO to delete the disallowances made u/s. 10AA of the Act by allowing the grounds raised by the assessee in this regard.

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• 2025 (4) TMI 847
  TP Adjustment - Benchmarking of AMP expenditure - HELD THAT:- We find that in Sony Ericsson [ 2015 (3) TMI 580 - DELHI HIGH COURT] Hon ble High Court was though dealing with question whether AMP expenditure is a separate international transaction and further on the methodology to be adopted to benchmark such transaction and the Hon ble High Court upheld the tax department s proposal that AMP was a separate international transaction in the batch of cases under consideration. However, would show that even where AMP is a separate international transaction, it is permissible under the Act to benchmark the same as a closely connected transaction with the core distribution business. Concept of set-off has also been dealt with in detail. Noting that the purpose of chapter X was to be construed harmoniously with the objective under the Act viz., assessment of income for the purpose of levying tax, Hon ble Court concluded that the concept of set-off is embedded in the provisions of chapter X. These paras 193 and 194 show that once margins are found to be at arm s length by application of TNNM then same deserves to be accepted as benchmarking all transactions including AMP transaction involved in that batch of case. Major international transactions with AE s are import of raw materials and sale of semi-finished goods - In the case in hand all the transactions emanate from common agreement and arrangement, between the assessee and AE, thus such transactions can be held to be closely linked as the nature, characteristic and terms of such transactions substantially flow from the said agreement, as a single transaction for purpose of determining arm s length price. It is sufficiently established that these transactions were inextricably linked to each other in terms of nature and range of exclusivity of the product being manufactured by the assessee. Then we find that Tax authorities were not justified to question the use of technology by Assessee alleging assessee was not able to demonstrate that each year some new technology was transferred to it. In fact we find that during the year itself the assessee has entered into an international transaction of purchase of machinery and parts worth Rs.29.83 crores which has been found to be at arms length and not disturbed from TNMM. The allegation that the assessee is running a full- fledged business in India so there is no justification that personnel belonging to a company located in Singapore will need to travel to India to support on marketing procurement etc., is based on mere conjectures. Such reasoning also establishes that there was no reason to question the applicability of TNMM at entity level. Then, we find that the TPO has not been able to substantiate the rejection of the transfer pricing study of the assessee by any significant evidences, reasoning or conclusions. The reasons may have been sufficient to show cause the assessee for rejecting the TPS but while reaching a different pricing the reasons should have been substantiated, on the basis of tests of comparability, which is not done. Though not relevant to the ground before us, if we take into consideration, for conclusiveness, how after rejecting the aggregation approach with regard to disputed transaction, the TPO went on to examine the margins, we find that the TPO has miserably failed to establish on the basis of comparability tests, that these transactions once removed from TNMM would in any way disturb the net martin determined in the TPS. TPO thus arbitrarily disturbed the same. A careful perusal of the TP order reveals that based on very general assumptions and relying case laws which over the years have evolved, the conclusion was drawn. The same, thus, cannot be sustained. In the case in hand before us, the TPO has not alleged as to on what basis the three disputed transactions were not connected to the rest so as to determine the arm s length price separately from and independent of others. The three disputed transactions which the AO has examined independently in the case of the present assessee were such that they were dependent upon and related to the pricing of other transactions and the same have been accordingly aggregated by the assessee while calculating the margins of 16.99%, which stands accepted. So the case relied is very distinguishable and rather helps the assessee before us, as here the assessee has combined transactions which are intrinsically related to manufacture of single line of product. Then, the judgement in the case of Bombardier Transportation India Pvt. Ltd [ 2015 (11) TMI 1527 - ITAT DELHI] was in regard to a company engaged in manufacturing metro trains and supply of coaches under a consortium. The assessee in that case had preferred CUP as MAM method, but, tax authorities were of the view that TNMM is the most appropriate method. We are of the considered view that without establishing that the nature of transactions under scrutiny are similar in regard to similarly situated assessee, such the judicial pronouncements cannot come to the rescue of the Revenue. Issue may be restored to the TPO for fresh determination of comparability, ld. Counsel has invited our attention to the decision of Rajesh Bhabhubhai Damania [ 2000 (6) TMI 5 - GUJARAT HIGH COURT] that there cannot be multiple opportunities and second innings for completing assessment, and we are of considered view that where the impugned order is not having any apparent defect out of lack of opportunity with the ld. Tax authority below to complete the enquiry or determination of fiscal liability then for improving the case, the issue cannot be resorted to them again. Tax authorities have fallen in error in rejecting the TNMM as MAM for determining the disputed international transactions and erred in segregating these three disputed transactions to determine their arm s length separately. The findings arrived in for AY 2014-15 apply mutatis mutandis to appeals for other AY before us. Disallowance u/s 37 towards entrance fee and subscription paid during the subject assessment years 2013-14 and 2014-15 and disallowance u/s 36(1(va) of the Act on account of delayed deposit of employees contribution of PF, in AY 2012-13 no substantial contention was raised so as to interfere in findings of ld. Tax authorities below. In any case, as with regard to delayed deposit of the employee s contribution, the issue now stands settled against the assessee by the judgement of the Hon ble Supreme Court in the case of Checkmate Services P. Ltd. [ 2022 (10) TMI 617 - SUPREME COURT] thus corresponding grounds are dismissed.

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• 2025 (4) TMI 846
  Benefit of exemption u/sec. 11 - filing its return of income and audit report in Form No.10B beyond the extended due date - HELD THAT:- There is no dispute with regard to the fact that the due date for filing the return of income was by 15.02.2021 and that the return of income filed by the assessee belatedly along with Form No.10B audit report was on 03.03.2021. Admittedly there is a delay of 18 days in filing the return of income and audit report. However, the fact remains that, audit report in Form-10B has been filed before the AO passed the assessment order i.e., on 12.05.2022. The assessee has explained reasons for not filing the return of income and audit report on or before the extended due date i.e. on 15.02.2021. We find that the period is under peak Covid-2019 pandemic outbreak and during the Covid pandemic period, the normal life of all the citizens was effected very badly be that an individual or trust. Therefore, going by the Covid pandemic situation, in our considered view, the small delay of 18 days in filing the return of income and audit report in prescribed Form No.10B should have been condoned by the authorities below when the relevant audit report in Form-10B was made available to the AO before the AO passed his assessment order dated 12.05.2022. AO and the learned CIT(A) was erred in rejecting exemption u/sec.11. Thus, we set-aside the order of the CIT(A) and direct to the AO to allow the benefit of exemption u/sec.11 - Appeal of the assessee is allowed.

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• 2025 (4) TMI 845
  Addition made on account of commission on turnover transaction - HELD THAT:- The entry was corroborated with the bank accounts enclosed with such submissions. AO failed to point out any infirmity or incorrectness in such specific explanation provided by the assessee with regard to such noting. AO could not point out any unrecorded/cash payment transaction with regard to receipt of commission on the impugned document. In the letter dated 29/11/2018, at Para (a), addressed to the AO we find that assessee did mentioned that detailed enquiries were made by the Investigating Officer with the officer/Director of the company. The details of BCL were available with the authorities, however, nothing is on record as to whether BCL has been examined on this issue and definitely, there was no document or confirmation from BCL brought on record that they paid commission to the assessee. In the absence of such evidence of payment of commission by BCL or anybody else and we are of the considered opinion that there is no income in the nature of commission received by the assessee. We direct the AO to delete the addition. Thus, the grounds raised by the assessee are allowed. Addition on account of commission on turnover transaction - HELD THAT:- We find that identical issue has been raised by the assessee in its appeal being for the assessment year 2011-12 we have decided this issue in favour of the assessee and against the Revenue in Para-10, 11 and 12, of this order. Addition on account of commission on loan transaction - addition is made by AO on earning income of commission income @ 0.25% on the basis of sworn statement of the assessee - We find that in the statement recorded during search on 26/07/2016, extract of which are reproduced of the assessment order, the assessee agreed about the earning of commission and indicated that the commission charged ranges between 0.1% and 0.25%. There was no evidence found about the actual earning from commission and in such circumstances the AO adopted the rate of 0.25% for determination of income. Thus, according to us, the average of both the rates would meet the end of justice. Consequently, we direct the AO to adopt rate of 0.15% for determining the income earned on account of commission. Thus, in view thereof, the commission income earned applying the rate of 0.15% would be restricted to Rs. 7,595, and the addition to that extent is confirmed. Thus, ground raised by the assessee is partly allowed. Addition on account of unsecured loan u/s 68 - On a careful analysis of judgements of Ambe Tradecorp. Pvt. Ltd. [ 2022 (7) TMI 902 - GUJARAT HIGH COURT ] and in Merrygold Games Pvt. Ltd. [ 2024 (6) TMI 1371 - GUJARAT HIGH COURT ] wherein we find that the Hon ble Gujrat High Court has concluded that when the repayment of loan is accepted by the department in assessee s case the addition made u/s 68 of the Act is unjustified and unsustainable. As respectfully following the decision in Vibrant Global Capital Ltd. [ 2024 (11) TMI 312 - ITAT NAGPUR ] and detailed legal position discussed therein, we are of the considered opinion that the addition made in assessee s case u/s 68 is unjustified and unsustainable on facts and in law. In assessee s case the confirmation, financial statement, Bank Statement, Master Data from MCA Portal and ITR of the lender have been placed on record. The assessee has discharged his onus to explain the credit by adducing legal evidence on record. Accordingly, we set aside the impugned order passed by the learned CIT(A) on this issue and the addition made u/s 68 is hereby directed to be deleted. Additional income offered in Return - Telescoping - CIT(A) accepted the jewellery inherited by the assessee after the demise of his family members and also the explanation with regard to jewellery purchased for which bills and voucher, ledger and cashbook were submitted. In the impugned order passed by the CIT(A), addition of Rs. 75 lakh has been already deleted. As regards the additional income of Rs. 75 lakh offered by the assessee in his return of income, CIT(A) of the impugned order held that the surrendered income covers any unexplained portion of gold jewellery and silver articles or cash found during the search operation. Thus, we find that the CIT(A) has already allowed the telescoping of other addition from the amount remaining out of surrendered income. We have also examined the issue of chargeability of income u/s 115BBE and found that a separate ground has been raised before the CIT(A) on which there is no specific findings given in the CIT(A) order. Considering the application of the assessee and after examining the issue of surrender of income we find that the assessee surrendered income in the return of income without specifying any item and without taking credit of such income in the books of accounts. We hold that the provisions of section 115BBE cannot be applied in the instant case and the surrendered income is chargeable to tax at normal rates. Consequently, we set aside the impugned order passed by the AO on this issue by allowing grounds raised by the assessee. Legality of notice issued u/s 148 and proceedings or re-opening u/s 147 - invalid approval granted u/s 151 - Approval/sanction granted under section 151 by writing - Yes, I am satisfied cannot be held to be a valid approval/sanction. The impugned notice issued under section 148 of the Act and proceedings or re-opening under section 147 of the Act are not sustainable and are thus hereby quashed. Consequently, ground no. 1, raised by the assessee is allowed. Addition on account of amount received in Bank - The assessee fairly considered that the enquiry was made in the year 2017 while the transactions were in the financial year 2009-10. As discussed, in the order for the assessment year 2011-12, wherein we have already noted that the address of the company was known to the Department, however, there was no enquiry with such company by the AO. AO, while making addition, mentioned that the assessee could not furnish the return of income of his father or his own so that the shareholding declared could be verified. The return of income, according to our knowledge, for the year 2008-09 and 2009-10 did not have any such requirement of disclosure of shareholding. Further, in a closely held company the share certificate is required to be surrendered along with share transfer form at the time of its transfer to the transferee. We hold that the credit in Bank Account is on account of realisation of opening balance in asset account viz., shares and the name of the payer is identifiable and, therefore, it cannot be a treated as unexplained income as the Revenue has miserably failed to point out the any incorrectness in the information provided in spite of the search action. Thus, considering the above factual aspects, we direct the AO to delete the addition.

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• 2025 (4) TMI 844
  Addition u/s 68 - Addition on account of unsecured loan - addition made by the A.O. on account of share capital by ignoring the fact that M/s K. K. Steel Pvt. Ltd. failed to prove genuineness of the transaction and Director of both the Companies - HELD THAT:- AO while making the addition as observed that the Assessee has not furnished any details and evidences in respect of secured loan raised in the year under consideration. It was the case of the Assessee before the AO and before the Ld. CIT(A) that secured loans were raised against hypothecation of commercial vehicles such as the Trucks, Dumpers, Crains and Hydra etc. from the bank and those vehicles are exclusively used for business manufacturing activities of the Assessee Company. Assessee furnished confirmation of the financial institution of their credit balance as on 31/03/2008 and also copies of the statements. CIT(A) considering the fact that the Assessee has also defaulted in repayment of secured loans from the bank and also furnished requisite documentary evidence to establish that secured loans were raised from banks during the relevant year and deleted the addition, thus, we find no reason to interfere with the order of the CIT(A) in the absence of any contrary evidence brought on record by the Department. Addition u/s 68 - HELD THAT:- Though the share applicant Companies were not in existence in the given address and despite the fact that the summons were issued u/s 131 of the Act, which were never answered, however, 18 share applicants Companies have sent replies with just two lines written on their pads stating that they have made investment in share application money with the Assessee company. Apparently, all the replies have been written on nearby dates and pattern of the reply in all the cases are one and the same, further most of the replies have been sent through the same courier/speed post with consecutive courier/speed post numbers. Though the share applicant companies have sent stereotype reply, it is strange and we don t understand what prevented them to present before the AO for the examination. Considering the fact that the A.O. has made every effort to enquire on the share applicant money by making/issuing summons u/s 131 of the Act, notice u/s 133(6) of the Act the burden will also cast upon on the Assessee to prove the three limbs/requirements of the Section 68 of the Act, which has not been discharged by the Assessee. Considering the above facts and circumstances, we find no reason to interfere in the order of the Ld. CIT(A) in confirming the addition. Finding no merits in the Grounds of appeal of the Assessee, we dismiss the same.

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• 2025 (4) TMI 843
  Reopening of assessment - invalid satisfaction accorded for reopening of assessment - notice issued after the expiry of 4 years - HELD THAT:- Though sanction claimed to have been obtained from the Learned PCIT, for re-opening of assessment for AY 2012-13, document whereof annexed at page-7 of the Paper Book filed before us, no date has been mentioned by the PCIT while granting such sanction under Section 151 of the Act. The same, thus, cannot be said to be a valid one and therefore, consequentially the notice under Section 148 of the Act dated 31.03.2019 on the basis of such invalid sanction is found to be illegal and void ab initio. The judgment relied upon passed by the Hon ble High Court in the matter of Shree Tarlok Chand Lal Goyal [ 2023 (9) TMI 842 - DELHI HIGH COURT ] has been duly considered wherein it is found that on the basis of wrong finding of fact that the assessee has not filed the return of income for the year under consideration reasons to believe was recorded whereas the assessee duly filed the return of income. As the foundation on the basis of which the assessee s proceedings has been triggered against the assessee is found to be wrong, the entire assessment proceedings has been quashed as void ab initio. Decided in favour of assessee.

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• 2025 (4) TMI 842
  Addition u/s 68 - unexplained credits - estimating the business income @8% on the basis of credit submissions in the bank account - HELD THAT:- The assessee company is apparently, a conduit company used by the Jain Bros. for routing the accommodation entries to other beneficiaries. In identical facts, the AO has applied 0.3% on the credits received from Jain Group as commission income passed u/s 143(3) of the Act relevant to Assessment Year 2012-13. Having regard to the similarity of facts situation, there appears to be a force in the plea of the assessee for assessment of income @ 0.3% of the credits received from Jain Group. The first appellate order is consequently, set aside and the additions made by the AO is modified to restrict the unaccounted income by applying 0.3% of the total credits received during the year.

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• 2025 (4) TMI 841
  Unaccounted income attributable to agreement to sale executed by the assessee for sale of certain property and found in the search action u/s 69A - HELD THAT:- We find that the genesis of additions is an agreement to sell found to be entered between the assessee and Manoj Choudhary for sale of property at a consideration of Rs.3,75,00,000/-. As demonstrated on behalf of the assessee before the CIT(A), firstly the property belongs to RD Finlease and, therefore, the MOU executed in personal capacity between Amarpreet Anand and Manoj Choudhary is in the nature of dumb document carries no legal effect. MOU has neither been acted upon nor could have been acted upon. Secondly, the shares of the company (RD Finlease Ltd.) were sold by the shareholders including the assessee holding 1,61,000 shares (out of total shares 5,88,300) during the financial year relevant to AY 2012-13. Thirdly, the shares transferred by the assessee do not tantamount to transfer of property held by the company as held in Bhoruka Engineering Ltd. [ 2013 (7) TMI 543 - KARNATAKA HIGH COURT] Fourthly, the shares were sold by the assessee at a higher price than what is FMV as per valuation adopted under Rule 11UA of the Rules. Based on such facts, the additions towards unaccounted income based on dumb document in the form of a MOU (remaining un-acted) has been rightly reversed by the CIT(A). The action of the CIT(A), thus, cannot be faulted. Appeal of the Revenue thus deserves to be dismissed.

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• 2025 (4) TMI 840
  Addition of delayed deposit of PF and ESIC, towards employees contribution u/s. 36(1)(va) - HELD THAT:- It is observed that the assessee has challenged the addition/disallowance made by the ld. A.O. and upheld by the ld. CIT(A) on the delayed payment of PF and ESIC towards employees contribution. As this issue is no longer res integra and stands squarely covered by the decision in the case of Checkmate Services Pvt. Ltd. [ 2022 (10) TMI 617 - SUPREME COURT] wherein it was held that the employees contribution deducted by the assessee u/s. 36(1)(va) of the Act is an allowable deduction only when the same is deposited by the employer on or before the due date specified under the relevant Acts and the same would amount to the employer s income u/s.2(24)(x) of the Act, if the same is not deposited in the relevant statutory funds. The same is binding on all courts as per Article 141 of Constitution of India and, therefore, we decline to interfere with the same. Payment of the same within 15 days from the close of the month, whether pertains to the actual disbursement of the wages or the month in which the salary was due - The assessee has relied on various decisions of the Tribunal to substantiate that 15 days from the close of the month should be interpreted as the month during which disbursement of salary is actually made, should be reckoned for the purpose of determination of due date of deposits under the relevant Acts and not the month when the salary was due to the employees. As observed in the case of CIT vs. Madras Radiators Pressing Ltd. [ 2002 (12) TMI 36 - MADRAS HIGH COURT] has held that the term every month in clause 38 of the Provident Fund Scheme should be read as month in which the wages were actually earned, i.e., the salary payable and not when the salary was paid . It further reiterates that the responsibility of the employer to make the payment towards the employer s contribution irrespective of the facts that whether the wages are paid in time or not. Decided against assessee.

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• 2025 (4) TMI 839
  Denial of benefit of New Tax Regime u/s.115BAC - Admittedly, the assessee had filed the option for falling under the New Tax Regime by way of filing Form No.10IE on 10.10.2022 - HELD THAT:- The proviso to section 115BAC provides that the option made by the assessee u/s.115BAC(5)(i) of the Act once exercised for any previous year can be withdrawn only for a previous year other than the year in which it was exercised and thereafter, the person shall never be eligible to exercise option under this section, except where such person ceases to have any income from business or profession in which case, option u/s.115BAC(5)(ii) of the Act shall be available. On perusal of the above contents of section 115BAC notice that the assessee has to make the claim once and then it is applicable for subsequent years subject to proviso referred above. In the instant case, the assessee furnished a claim on Form No.10IE on 10.10.2022. Admittedly, the due date for A.Y. 2022-23 expired prior to filing of Form No.10IE on 10.10.2022 and therefore assessee could not get the benefit of section 115BAC of the Act for the A.Y. 2022-23. As before us the year under appeal is A.Y. 2023-24 and the option furnished in Form No.10IE is much prior to the due date of filing the return u/s.139(1) of the Act for A.Y. 2023-24. The Revenue authorities have not found any discrepancy in the contents of Form No.10IE furnished by the assessee except being belated. As following the decision of this Tribunal in the case of Akshay Devendra Birari [ 2024 (6) TMI 272 - ITAT PUNE] it is the considered view that the assessee has made a valid claim for availing the benefit under the New Tax Regime u/s.115BAC. Appeal of the assessee is allowed.

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• 2025 (4) TMI 838
  Revision u/s 263 - capital gain arising from sale of the agricultural land in question by treating the same as situated within the distance of 2 km from Tehsil and District Harda as stated by ITO, Investigation Bhopal in his report - HELD THAT:- CIT has proceeded on the basis of verification of distance from the Google map and observed that the aerial distance of the land in question from the municipal limits of the Harda is 1 (one) km. It is pertinent to note that after the delimitation of the Municipal limits in the year 2016 the distance has taken by the Pr. CIT at the time of issuing show cause notice on January 2024 may not have given correct facts about distance of the land from the Municipal limits as exist in the year 2013. We further note that once the assesse has produced certificate issued by the Municipal Corporation to substantiate his claim that the land in question is situated outside the limit as prescribed u/s 2(14)(iii) then while invoking provisions of section 263 the Pr. CIT ought to have brought some tangible material on record to show that the said certificate issued by Municipal Corporation has not given correct facts on this point. Merely on the basis of the distance verified from the google map in the year 2024 would not amount to bring a tangible material to show that the alleged aerial distance as shown in the year 2024 was also aerial distance from the municipal limits as exist in the year 2013. Therefore, ignoring this crucial point, the distance taken by Pr. CIT in the year 2024 is certainly not reflecting the actual distance from the Municipal limits in the year 2013 specifically in view of the fact that the Municipal limits were modified/extended subsequently in the year 2016. Therefore, once the AO has conducted an inquiry and accepted the claim based on the documentary evidences filed by the assesse showing the distance of the land in question from the Municipal limits is more than 2 km then the Pr. CIT at the time of exercising jurisdiction u/s 263 ought to have given conclusive finding that the order passed by the AO is unsustainable either in law or facts. Direction to the AO to re-examining the issue itself shows that the Pr. CIT was not sure about the correctness of the claim or view taken by the AO. This find of the Pr. CIT clearly shows that he has set aside the matters to the record of the AO for reexamination of the issue and to make de-novo assessment which means that the commissioner was also not certain about correctness of the claim of the assesse. This course of action on the part of the commissioner is not permissible when the AO has conducted inquiry and has taken view based on the material on record and therefore, the only course available with the Pr. CIT u/s 263 was to give a conclusive finding that the view taken by the AO is not sustainable under the law. In case of CIT vs. Sunbeam Auto Ltd 2009 (9) TMI 633 - DELHI HIGH COURT] while dealing an issue of lack of inquiry and inadequate inquiry has AO has conducted an inquiry and was satisfied with the supporting evidences produced by the assesse in response to notice u/s 142(1) then it is not necessary for the AO to give an elaborate finding on the issue. CIT while passing revision order cannot remand the matter back to the AO for fresh adjudication simply because he himself was not sure about correctness of the claim of the assessee. Accordingly when the order passed by the AO is not erroneous for want of inquiry then it is incumbent upon the Pr. CIT to give conclusive finding that the impugned order passed by the AO is not sustainable in law. Hence, impugned order of the Pr. CIT passed u/s 263 is not sustainable and the same is liable to be set aside. Decided in favour of assessee.

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• Customs

• 2025 (4) TMI 837
  Detention of gold jewellery - absence of SCN and the lack of an opportunity for a personal hearing - violation of principles of natural justice - HELD THAT:- In the opinion of this Court, since no Show Cause Notice was issued to the Petitioner in the present matter and no opportunity for personal hearing was granted, the same is not in accordance with law and would be contrary to the previous decisions of this Court including Amit Kumar v. The Commissioner of Customs [ 2025 (2) TMI 385 - DELHI HIGH COURT] and Mr. Makhinder Chopra v. Commissioner of Customs, New Delhi [ 2025 (3) TMI 19 - DELHI HIGH COURT] . This Court has also pronounced several orders/judgments, following various judgments of the Supreme Court and this Court, wherein it has been held clearly that if the gold items seized are personal jewellery, the same would not be liable to be confiscated. In fact, even in the connected petitions of the family members of the Petitioner, this Court has directed for release of the confiscated articles of the Petitioner on the same grounds of non-issuance of show cause notice and absence of personal hearing to the Petitioner - the detention of Petitioner s gold jewellery is illegal and the Order-in-Original passed in pursuance to such detention is not sustainable. Conclusion - The detention of the Petitioner s gold jewellery is illegal and that the Order-in-Original is unsustainable due to the lack of procedural fairness. Petition disposed off.

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• 2025 (4) TMI 836
  Jurisdiction of Directorate of Revenue Intelligence (DRI) to initiate an investigation into the issuance of Service Exports from India Scrips (SEIS) to the petitioner by the Directorate General of Foreign Trade (DGFT), respondent No. 3 - HELD THAT:- The petitioner should not be aggrieved at the stage of investigation by respondent No. 2. However, at the same time, respondent No. 2 is also restrained from taking any coercive action against the petitioner during the course of investigation. Petition disposed off.

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• 2025 (4) TMI 835
  Misuse of adjournments by parties during the appellate proceedings, specifically in the context of the Central Excise Act, 1944, and the CESTAT Procedure Rules, 1982 - whether repeated requests for adjournments without sufficient cause could justify the dismissal of an appeal for non-prosecution? - HELD THAT:- In case of Ishwar lal Mali Rathod [ 2021 (9) TMI 1301 - SUPREME COURT] condemning the practice of adjournments sought mechanically and allowed by the Courts/Tribunal s Hon ble Supreme Court has observed that considering the fact that in the present case ten times adjournments were given between 2015 to 2019 and twice the orders were passed granting time for cross examination as a last chance and that too at one point of time even a cost was also imposed and even thereafter also when lastly the High Court passed an order with extending the time it was specifically mentioned that no further time shall be extended and/or granted still the petitioner defendant never availed of the liberty and the grace shown. In fact it can be said that the petitioner defendant misused the liberty and the grace shown by the court. Conclusion - There are no justification for adjourning the matter beyond three times which is the maximum number statutorily provided. The Appeal is dismissed for non prosecution in terms of Rule 20 of CESTAT Procedure Rules, 1982.

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• 2025 (4) TMI 834
  Valuation - inclusion of floating crane charges incurred for unloading coal from mother vessels to barges in the assessable value as part of transportation costs under Section 14 of the Customs Act, 1962, and Rule 10 of the Customs Valuation (Determination of Value of Imported Goods) Rules, 2007 - Loading/unloading expenses from mother ship to barge are part of cost of transportation and includible in assessable value post 2007 under new Section 14 based on actual transaction value - difference of opinion - majority order - HELD THAT:- It is found that in the present case in order to come to the conclusion as to whether the floating crane charges can be termed has transportation cost or not, the same would require to go into factual details. It is also found that in WIPRO LTD. VERSUS ASSISTANT COLLECTOR OF CUSTOMS OTHERS [ 2015 (4) TMI 643 - SUPREME COURT] , the Supreme Court has viewed that the amendment per se to Section 14 (1) on its own is not bringing in any material change except for the mode of arriving at the value which was based on deemed value earlier and change to transportation value w.e.f 10.10.2007. A harmonious reading of the Section 14 (1) prior to 2007, subsequent to 2007, read with Valuation Rules, 2007, clarifies this. Therefore, simply based on the amended provision of Section 14 (1) alone, the matter cannot be decided. The Hon ble Member (Judicial) has gone into various factual details gone into by the Hon ble Supreme Court in ISPAT INDUSTRIES [ 2006 (9) TMI 181 - SUPREME COURT] , which he has recorded and has rightly felt that they are required to be checked even in the present case. The Hon ble Member (Judicial) is agreed upon and it is held that the matter is required to be remanded to the adjudicating authority to undertake necessary verification of the points highlighted by him at Para 19 (a) to (f) and as per the directions given by him at Para 20 and Para 21 of the Interim Order. Conclusion - The question as to whether any further addition to CIF value for transportation charges is warranted or not, needs elaborate discussions and findings on various aspects. The matter is to be placed before the regular Division Bench to pass necessary order.

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• 2025 (4) TMI 833
  Absolute confiscation under Section 111(d) of the Customs Act, 1962 - imported LED luminaries - BIS No. and standard marks were not printed/embossed on the goods, but were printed on the package - HELD THAT:- The only reason for challenging the impugned order is that BIS Mark was not affixed at the time of importation as per MEITY Order, but is found printed on the packets of goods in question. Conclusion - The goods are not liable for absolute confiscation under Section 111(d) and should be released for home consumption. The penalties and redemption fines imposed by the lower authority are set aside. Appeal of Revenue dismissed.

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• 2025 (4) TMI 832
  Classification of imported goods - L-Glutamine with berries - to be classified under CTH 2922 4990 or under CTH 2106 9099? - HELD THAT:- In the impugned order, the learned Commissioner (Appeals) totally relied upon the source material contained in Wikipedia without discussing other materials as alleged in the show-cause notice and discussed by the adjudicating authority. Recently, the Hon ble Supreme Court in the case of Hewlett Packard India Sales Pvt. Ltd. [ 2023 (1) TMI 700 - SUPREME COURT] , recording a note of caution on reliance of materials in Wikipedia observed that despite being a treasure trove of knowledge, are based on a crowd-sourced and user-generated editing model that is not completely dependable in terms of academic veracity and can promote misleading information as has been noted by this court on previous occasions also. No doubt Wikipedia can be considered as one of the source material for deciding the classification of the impugned product but it cannot be sole basis for arriving at the correct classification of the impugned goods, that too when it is not alleged in the notice. In these premises, the learned Commissioner (Appeals) is directed to decide the issue afresh on the basis of materials as alleged in the show-cause notice and discussed by the adjudicating authority in classifying the product. Appeal allowed by way of remand.

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• 2025 (4) TMI 831
  Violation of conditions of the Ad-hoc Exemption Order No. 336 dated 20.12.1995 - disposal of vehicles as scrap - time-limit for issuing a demand in respect of violation of conditions of a Notification - SCN issued almost 20 years after the duty payment - HELD THAT:- The Appellant had been gifted two vehicles, namely, a Land Rover Range Rover (1993 Model) and a Land Rover Defender (1995 Model). The said vehicles were cleared without payment of duty as per the exemption provided under the Ad-hoc Exemption Order No. 336 dated 20.12.1995. The 1993 make Land Rover Range Rover was disposed of after eight years of use and the 1995 make Land Rover Defender was disposed of after twelve years of use. The Appellant had been using the vehicles in desert areas and the engine of the vehicles had become exhausted. The cars/vehicles had become junk and not motorable. It has been stated by the Appellants that the required spare parts of the vehicles were not available in the Indian market and importation of such spare parts from abroad is also not viable. In such circumstances, the Appellant decided to dispose of the said vehicles. It is observed that the disposal of the vehicles as scrap in a non-usable condition cannot be equated with sale of vehicles. In the present case, the Appellant has fulfilled the Condition Nos. (i), (ii) and (iv) and it is the Condition No. (iii) which is alleged to have been violated. As per the Condition No. (iii) (supra), the vehicle should not be sold, disposed of, gifted, loaned, exchanged. or parted away without prior permission of the Department of Revenue, Ministry of Finance, New Delhi . It is found that this condition is meant for restricting sale of vehicles which are in working condition. If the vehicle has become a scrap and is not in a motorable condition, then this condition cannot be made applicable to demand Customs Duty. The Appellants have not violated the conditions of the Notification, as they have not sold the vehicles. Disposing of the vehicles as scrap after they have outlived their utility cannot be considered as sale of vehicles . Accordingly, the demand of Customs Duty from the Appellant is not sustainable and hence the same is set aside - As the demand of duty is not sustainable, the demand of interest and imposition of penalties on the Appellants is also not sustainable. Time limitation - HELD THAT:- It is found that only when there is a continuous obligation to be fulfilled by an importer, as per exemption Notifications, a demand can be issued for violation of conditions of the Notifications without any time limit. In this case, the Ad-hoc exemption has not cast any continuous obligation on the part of the Appellant. As per the conditions of the Ad-hoc Exemption Order, the vehicles cannot be sold without permission from the Ministry of Finance. This restriction is not applicable for disposal of the vehicles as scrap once they became non-motorable. If suppression of fact with intent to evade the duty is established, then the demand must be issued within the maximum stipulated period of five years from the date of payment of duty - the Notice issued beyond the period of five years is not sustainable. Accordingly, the demand of Customs Duty from the Appellant beyond the period of five years in the impugned order is not sustainable on the ground of limitation also. Conclusion - The Appellant did not violate the exemption conditions, the demand for duty and penalties is unsustainable, and the Show Cause Notice is time-barred. The impugned order set aside - appeal allowed.

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• 2025 (4) TMI 830
  Classification of imported goods - ATM monitors - to be classified under CTH 8473 as parts of ATMs or under CTH 8528 as other monitors? - HELD THAT:- Tariff Headings ATM is clearly classifiable under CTH 8472 9030, CTH 8473 4090 as others covered under parts and accessories of the machines falling under CTH 8472. In other words, the monitor which is a part of the ATM (not disputed) is clearly classifiable under 8473 4090 as parts of ATM. The claim of the revenue to classify them under CTH 8528 5900 as others under the residual entry only for the reason that the word monitor is specifically mentioned under this Chapter Heading cannot be accepted in view of the fact that parts of ATM are clearly classifiable under CTH 8473. Since these parts meant for ATM are not excluded under Note 1 above, the criteria for classification would be Clause 2(b) where specifically parts which are suitable or principally used with a particular kind of machine, or with a number of machines of the same heading (including a machine of heading 8479 or 8543) are to be classified with the machines of that kind. Since, there is no dispute that the product monitors are ATM monitors which have to be necessarily used as parts of monitors they are rightly classified under CTH 8473 as parts of ATM CTH 8472. Conclusion - The imported ATM monitors are to be classified under CTH 8473, aligning with the classification of ATMs under CTH 8472. The impugned order is set aside - appeal allowed.

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• 2025 (4) TMI 829
  Classification of imported goods - Clear Float Glass - whether the product should be classified under Customs Tariff Heading (CTH) 7005 1090, as claimed by the appellant, or under CTH 7005 2990, as determined by the Revenue? - benefit of N/N. 46/2011-Cus dated 01.06.2011 - HELD THAT:- The appellant had placed on record the decision by this Tribunal in their own case wherein the impugned products were classified under Chapter Heading 7005 1090. The Tribunal in M/S. SWASTIK SAFETY GLASS (BANGALORE) PVT. LTD. VERSUS COMMISSIONER OF CUSTOMS, CHENNAI [ 2024 (10) TMI 334 - CESTAT CHENNAI] where it is held that the imported Clear Float Glass is classifiable under CTH 70051090, making the appellant eligible for the FTA benefit under Notification No. 46/2011-Cus. The invocation of the extended period for demand of duty and penalties was not justified. Conclusion - The Clear Float Glass imported by the appellant is classifiable under CTH 7005 1090 and not CTH 7005 2990. The appellant is entitled to the benefit of N/N. 46/2011-Cus, subject to compliance with the relevant conditions. Appeal allowed.

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• 2025 (4) TMI 828
  Levy of penalty - misclassification of the imported goods on bona fide ground - HELD THAT:- This issue stands settled in favour the appellant by the Hon ble Supreme Court in the case of Northern Plastic Ltd. vs. CC CE [ 1998 (7) TMI 91 - SUPREME COURT] , wherein their Lordships observed that neither on the ground of misdeclaration nor on the ground of import being unauthorized or illegal, the goods imported by the appellant were liable to confiscation. Appeal allowed.

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• 2025 (4) TMI 827
  Classification of imported projectors - to be classified under CTH 8528 6100 as data projectors solely and principally used with Automatic Data Processing (ADP) machines or under CTH 8528 6900? - benefit of exemption - HELD THAT:- The matter is no longer res integra as the issue of classification already stands settled in the appellant s own case in the case of M/s. BenQ India Pvt. Ltd. vs. ADG (Adjudication), New Delhi [ 2022 (9) TMI 690 - CESTAT NEW DELHI] , wherein the Tribunal observed as The presence of such ports is only to ensure their use with laptops and ADPS. Therefore, even post 01.07.2017, goods would be classifiable under CTI 8528 62 00 and the decisions of the Tribunal rendered for the period prior to 01.07.2017 will continue to apply to projectors imported w.e.f. 01.01.2007. In view of the above decision and other large number of cases where the classification has already been settled in favour of the appellant classifying the impugned projectors under CTH 8528 6100, there are no reason to disagree with the above classification. Appeal allowed.

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• Service Tax

• 2025 (4) TMI 826
  Abatement or continuation of proceedings initiated against M/s. St. John Freight Systems Pvt. Ltd. - HELD THAT:- As the NCLT, Chennai has ordered for Liquidation of the Respondent and as no application as per Rule 22 has been made by the Official Liquidator appointed by the NCLT for continuance of the appeal, the appeal should abate in terms of Rule 22 of the Customs, Excise and Service Tax Appellate Tribunal (Procedure) Rules, 1982. As such the appeal gets abated in terms of Rule 22 of the CESTAT (Procedure) Rules, 1982 and also gets dismissed as being infructuous.

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• 2025 (4) TMI 825
  Liability to pay service tax on Annual Technical Support (ATS) fee on 100% of the invoice value as claimed by the Revenue as against the claim of the appellant that they are liable to pay only on 25% of the value - period of dispute is February 2007 to March 2009 - HELD THAT:- From the records, it is seen that the appellant has entered into software and support service agreement with the ICICI Bank Corporation Limited wherein at Clause 1.5 of the Agreement updates is defined as shall mean improved releases of the program which are generally made available at no additional cost to Infosys Licensees, who have purchases Annual Technical Support as specified in annexure-4- BANCS 2000 support services. Update shall not include any options or future products which Infosys licenses separately. In the instance case also, it is seen that VAT is being paid only on deemed sale and clearly goods are not found to be part of the Annual Technical Support Service, hence, the question of abatement does not arise even though the sale is considered to be deemed sale and VAT is discharged by the appellant. The fact that VAT has been paid will not vitiate the fact that the services rendered by the appellant are not leviable to service tax as is held by the Hon ble Supreme Court in the case of BSNL [ 2006 (3) TMI 1 - SUPREME COURT] , wherein their Lordships observed I t is, therefore, unnecessary to deal with the question of delivery of possession which is related only to situs and not to subject-matter of taxation which is a transfer of right to use goods. In the present case, as no goods element are involved, the transaction is purely one of service. There is no transfer of right to use the goods at all. In the instant case, it is also a fact that prior to and after the period in dispute, the appellant is paying service tax on the entire invoice value without disputing the fact that they are discharging VAT on part of the same value. Therefore, the question of not paying service tax on the entire value during the disputed period does not arise as the entire value is exclusively towards service element. There are no reason to disagree with the Commissioner with regard to payment of service tax on the entire invoice value. Accordingly, same is upheld. However, the appellant has been approaching the department and agitating this issue through series of correspondences/communications from December 2005 onwards. Various correspondence has been placed on record from December 2005 to September 2009 and at no point of time, objections were raised by the department. The Commissioner in the impugned order though admits the fact that the appellant vide their letter dated 26.04.2007 had informed the Department that service tax was being discharged on 25% of the value, discarded the same on the ground that the letter nowhere mentioned that VAT was being paid and the appellant failed to file the agreements and these omissions indicate the intention to evade payment of tax. Conclusion - ATS services provided by the appellant are subject to service tax on 100% of the invoice value, as they do not constitute a deemed sale under Article 366(29A) of the Constitution. Appeal allowed in part.

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• 2025 (4) TMI 824
  Short payment of service tax - works contract service - demand raised under the category of works contract service on the basis of comparison of their financial records along with Form 26AS and S.T.-3 Returns filed - penalty - HELD THAT:- No proper investigation has been conducted to find out as to the activity that was being undertaken by the appellant and as to whether the appellant have paid Service Tax on that activity or whether the said activity was exempt from the levy of Service Tax. Therefore, the demand against the appellant raised merely on the basis of financial records is not sustainable, since the Revenue has not adduced any supportive evidence in support of its allegations. The appellant was engaged in the activity of construction of dams. The said activity was related to transmission and distribution of electricity, which is exempt as per Notification No. 45/2010-S.T. dated 20.07.2010, Notification No. 11/2010-S.T. dated 27.02.2010 and Notification No. 25/2012-S.T. dated 20.06.2012. Thus, on the said activity, the appellant is not liable to pay Service Tax. Moreover, wherever the appellant provided services, being a sub-contractor, the main contractor has deducted the Service Tax component from the payments made to the appellant and paid the said Service Tax in the Government treasury, on behalf of the appellant. In these circumstances, the demand of Service Tax is not sustainable against the appellant. Penalty - HELD THAT:- Since no demand of Service Tax is sustainable against the appellant, no penalty can be imposed on the appellant. Conclusion - The demand for Service Tax based solely on financial records and Form 26AS is not sustainable. Without corroborative evidence, such demands do not hold. The impugned order is set aside - appeal allowed.

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• 2025 (4) TMI 823
  Calculation of service tax - inclusion of salary, PF, and other reimbursements in the taxable value under Section 67 of the Finance Act, 1994 - Extended period of limitation - HELD THAT:- The issue as to whether salary, PF, etc. are includable in taxable value in terms of 67 of the Finance Act, 1994 is no more res- integra. The Bangalore Tribunal in the case of Kou-Chan Knowledge Convergence Pvt. Ltd. Vs. CST, Bengaluru [ 2024 (9) TMI 1249 - CESTAT BANGALORE] has gone into the details and has held that the administrative charges collected in providing Manpower Recruitment and Supply Agency Service, is only to be part of the gross taxable value and all reimbursable expenses, salary, bonus, etc. paid to the employee by the appellant and collected from their clients cannot be included within the scope of gross taxable value under Section 67(1)(i) of the Finance Act, 1994 during the relevant period from October 2007 to March 2012. In the present case, the amounts received by the appellant on account of salary, PF, etc. would not be exigible to Service Tax payment. They are required to pay Service Tax only on the net consideration received by them from their clients. Extended period of limitation - HELD THAT:- Since the appellant has paid the Service Tax on their commission amount after excluding the salary and reimbursements and they were filing their ST-3 Returns, no case has been made out towards suppression by the Revenue. Therefore, the confirmed demand for the extended period is not legally sustainable on account of time bar. Conclusion - i) The reimbursements for salary and related expenses are not includable in the taxable value for service tax purposes. ii) The extended period for demand is not applicable in the absence of suppression. The impugned order is set aside and the appeal stands allowed.

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• 2025 (4) TMI 822
  Liability of appellant as a builder/developer is required to pay Service Tax under the category of Construction of Residential Complexes service during the period June 2005 to January 2007 - HELD THAT:- Undisputedly, the appellant had constructed flats on the land provided to him for development and sale to the prospective customers. The project was named as Ittina Neela comprising of 1092 flats. The appellant during the relevant period had sold the flats by entering into individual agreements with various buyers. Thus, the question arises whether the consideration received by the appellant from the sale of flats during the said period against the individual agreement, is liable to pay Service Tax under the category of Construction of Residential Complexes service. The Board had issued a Circular No.108/02/2009-ST dated 29.01.2009 and Circular No.151/2/2012-ST dated 10.02.2012, wherein it has been clarified that builder/developer is not liable to pay Service Tax for the period prior to 01.07.2010. Conclusion - The appellant is not liable to pay Service Tax for the construction of residential complexes prior to 01.07.2010. There are no merit in the impugned order - appeal allowed.

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• 2025 (4) TMI 821
  Levy of service tax - Authorized Service Station Services - reimbursement of warranty charges received by the appellant from vehicle manufacturers - amounts received for accident repair services - incentives and commissions received from vehicle manufacturers, insurance companies, and banks/financial institutions - rental income from immovable property - eligibility of cenvat credit utilized by the appellant for payment of service tax on Authorized Service Station Services. Service tax on Authorized Service Station Services - HELD THAT:- As rightly claimed by the appellant free services are provided to their customers who are owners of the vehicles and the reimbursements by the vehicle manufactures cannot be considered as service rendered to their customers in view of the definition prior to 16.05.2008. Moreover, reimbursements cannot form part of the value in view of the Supreme Court decision in the case of Union of India v. Intercontinental Consultants Technocrats Pvt. Ltd. [ 2015 (2) TMI 593 - SC ORDER] followed by this Tribunal in the case of Hewlett Packard India Sales Pvt. Ltd. vs. Commissioner of C. Ex. S.T. (LTU), Bangalore [ 2024 (1) TMI 679 - CESTAT BANGALORE] where the Tribunal has held that reimbursable expenses cannot be included in the taxable value. Service tax on Accident Repair Services - HELD THAT:- The Commissioner in the impugned order has clearly held that during the years 2004-05 and 2005-06 the appellant had declared a taxable service value has Rs.88,02,510/- and Rs.96,31,149/- respectively as against the amounts declared in their annual reports under vehicle service receipts as Rs.1,05,80,536/- and Rs.1,41,22,127/- respectively and since the appellant had not furnished any supporting documents as to why these differences in value the same was confirmed. Since, the demands are only on the differential value based on the annual reports placed before the audit authorities in 2005 the notice issued in 2009 cannot allege suppression of facts. Therefor the demand is confirmed only for the normal period. Service tax on incentives and commissions received from the vehicle manufacturers and commissions received from various insurance companies and banks and financial institutions - HELD THAT:- The appellant received incentives from the vehicle manufacturers for causing promotion and sale of their vehicles, commissions received from various insurance companies for causing promotion and marketing of services rendered by the insurance companies and the commission received from banks and financial institutions for promoting their business were said to be liable to service tax under Business Auxiliary Services. The appellant has contested this liability on the ground that these incentives and commissions are in the form of discounts and hence not liable to service tax as held by various decisions of the Tribunal. The appellant has opposed the element of suppression on the ground that these records were placed before the audit in the year 2005 and 2007 and no such allegations were raised, therefore they cannot be saddled with the allegation of suppression of facts. It is agreed with the appellant that since the relevant details of the earlier audit dated 13.07.2005 were placed before the audit officers, the show-cause notice issued on 20.04.2009 alleging suppression of facts, mis-statement cannot be sustained in view of the principles laid down by the Hon ble Supreme Court in number of decisions. Therefore, the demands are confirmed only for the normal period. Ineligible cenvat utilized for payment of service tax on the Authorized Service Station Services - HELD THAT:- The appellant had availed cenvat credit on invoices raised by their sister concerns M/S. Marikkar Engineers and Marikkar Industries in respect of services rendered for certain cars and motorcycles which had been sub-contracted to their sister concerns. Since, we have held that on the warranty services the appellant is not liable to pay service tax based on the claims reimbursed by the vehicle manufacturers the cenvat credit cannot be allowed. Hence, the same is being denied. Renting of immovable property - HELD THAT:- The Commissioner in the impugned order except mentioning to the affect that the issue is no more res-integra in view of the retrospective amendment effect carried out to this service vide Finance Act, 2010 , there is no mention as to why and how the rental amount received by the appellant could be considered as renting of immovable property. The appellant has submitted that the renting of immovable property was for commercial purpose and the same is not liable to service tax in view of the decision in the case of Home Solution Retail India Ltd. Versus Union of India [ 2009 (4) TMI 14 - DELHI HIGH COURT] wherein the Hon ble High Court observed that Section 65(105)(zzzz) does not in terms entail that the renting out of immovable property for use in the course or furtherance of business of commerce would by itself constitute a taxable service and be exigible to service tax under the said Act. The obvious consequence of this finding is that the interpretation placed by the impugned notification and circular on the said provision is not correct. Consequently, the same are ultra vires the said Act and to the extent that they authorize the levy of service tax on renting of immovable property per se, they are set aside. - the demand is justified. Since the demand is for the normal period, the same is confirmed. Conclusion - i) Reimbursements cannot form part of the value in view of the Supreme Court decision in the case of Union of India v. Intercontinental Consultants Technocrats Pvt. Ltd. ii) Demands against Accident Repair Services under Annexure XIII XIV confirmed for normal period. iii) The commission received by the appellant from the insurance companies and from the bank/financial institutions are liable to service tax under category of Business Auxiliary Service. iv) CENVAT credit denied due to non-liability of warranty services. v) Renting of immovable property is confirmed. All penalties were set aside as the demands were confirmed only for the normal period, with interest applicable - appeal allowed.

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• 2025 (4) TMI 820
  100% EOU - Refund claim - alleged lack of a direct nexus between input and output services - FIRC s do not correlate to the export invoices - no nexus with the output services - HELD THAT:- It is an admitted fact that while submitting the refund claims, appellant have produced the relevant documents including invoices on which input service credit has been availed, certificate from bank certifying list of export services, copy of RC Register, extract of Cenvat Credit Register for the period April 2010 to June 2010 and copy of export of invoices for the period from January 2010 to March 2010. As regards the refund claim for the period from January 2011 to March 2011, the appellant had submitted the refund application along with extract of cenvat credit register for the period January 2011 to March 2011, input credit Register for the period January 2011 to March 2011 along with summary of input credit, list of import of services, payment and challan copies, list of export, billing list of export sales, invoice copies along with large number of documents including copy of ST-3 returns, ST-3 copy of the declaration etc and also corelation of input service towards output service. The above said documents are sufficient enough to sanction the refund under Rule 5 of Cenvat Credit Rules, 2004. Even if the Chartered Accountant (CA) Certificate was not according to the satisfaction of the Adjudication Authority, the claim made by the appellant under Rule 5 of Cenvat Credit Rules, cannot be rejected on such insubstantial grounds. Conclusion - The definition of input service under Rule 2(l) of the Cenvat Credit Rules, 2004, does not require a direct nexus between input and output services, especially for 100% EOUs. Appeal allowed.

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• 2025 (4) TMI 819
  Irregular availment of benefit of exemption of service tax under N/N. 18/2009-ST dated 07.07.2009 or N/N. 42/2012-ST dated 29.06.2012 on the commission paid to foreign selling/ marketing agents - violation of the condition that cenvat credit should not be availed on the specified service - HELD THAT:- As per N/N. 18/2009-ST and 42/2012-ST, a declaration is required to be made regarding non-availment of Cenvat credit on specified service. Further, for the period from June 2012 to March 2015, as per N/N. 42/2012-ST dated 29.06.2012 there is only one service that has been exempted from service tax that is services provided by a commission agent located outside India under Section 66B of the Act. However, the adjudication authority has interpreted the words specified service used for export of such goods and has referred to any other services used for export of goods that were granted same exemption either in the same or similar Notification. The Respondent by adopting this interpretation, it was held that since appellant had availed CENVAT credit on GTA services/other services used for export of goods, appellant is not eligible to avail the benefit of exemption on commission paid to foreign selling/marketing agency . As regards the claim of the Appellant that the foreign commission agent is an intermediary under the Place of Provision of Service Rules 2012, since the Appellant himself had admitted that the service provided by them as falling under Business Auxiliary service and paid service tax over and above the exempted limit of 1% under N/N. 18/2009-ST or 10% under N/N. 42/2012-ST, hence their said contention is unsustainable. As regards the claim of the Appellant that they are exempted from payment of service tax under the provision of Section 26(1)(E) of the Special Economic Zone Act, 2005 r/w Rule 31 of the Special Economic Rule, 2006, there are force in the above submission as regards that part of the exports from the Special Economic Zone. In spite of giving specific submission to that effect in the reply to show cause notice, it appears that the Adjudication authority has not considered the above aspect. Extended period of limitation - HELD THAT:- The Appellant were submitting their returns in time and also complied with the conditions as stipulated. Facts being so, in the absence of any specific allegation regarding fraud, collusion, willful mis-statement or suppression of facts for evading payment of service tax, invoking the extended period of limitation for confirming demand is also unsustainable. Conclusion - i) The Appellant had correctly availed the exemption for commission paid to foreign agents by fulfilling the notification conditions. ii) The interpretation that availing CENVAT credit on other services like GTA violated the conditions is rejected. Appeal allowed in part.

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• 2025 (4) TMI 818
  Classification of service - liquidated damages or declared services - bond amount recovered from employees leaving University before notice period, whether the amount forfeited from the students, who discontinue the course midway - HELD THAT:- The issue is no longer res integra, the issue is squarely covered by the decisions/judgments cited, supra. Premature leaving of the employment results in disruption of work and an undesirable situation. The provisions for forfeiture of salary or recovery of bond amount in the event of the employee leaving the employment before the minimum agreed period or the amount forfeited from the students, who discontinue the course midway cannot be considered as liquidated damage or service under the category of declared service. It can be considered as penalties for dissuading, to discourage and to deter such a situation. Conclusion - The amounts recovered as bond amounts from employees and forfeited fees from students do not constitute a service under the category of declared service. Appeal allowed.

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• 2025 (4) TMI 817
  Refund of the amounts paid as service tax under reverse charge mechanism (RCM) - transportation charges paid to individual goods carriage/truck owners, who do not issue any consignment note by whatever name called - HELD THAT:- It is well settled that there is a distinction between an individual truck owner or the operator and agency in order to establish that the services of individual truck owners hired by the Appellant are not liable to service tax under the category of Goods Transport Agency (GTA) in terms of Section 65(50b) read with Section 65(105)(zzp) of the Finance Act, 1994. Further, the individual truck owners have not issued any consignment note, by whatever name called. Conclusion - The appellant s payment of service tax on transportation charges to individual truck owners was not warranted under the definition of goods transport agency services, as no consignment notes were issued. Appeal allowed.

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• 2025 (4) TMI 816
  Levy of service tax - Erection, Commissiong or Installation Services - composite contract undertaken by the appellant - period 2005-06 to 2007-08 - HELD THAT:- In the facts and circumstances of the case and following the decision of the Hon ble Apex Court in the case of Larsen Toubro Ltd., [ 2015 (8) TMI 749 - SUPREME COURT] and the decision of this Tribunal, the composite contract for supply of goods and services is chargeable to service tax only under Works Contract Service from 01.06.2007 and levy under any other category is not tenable prior to and after 01.06.2007. Therefore, the demand of service tax under the category of Erection, Commissioning or Installation Services is unsustainable. Conclusion - The composite contract for supply of goods and services is chargeable to service tax only under Works Contract Service from 01.06.2007 and levy under any other category is not tenable prior to and after 01.06.2007. Appeal allowed.

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• Central Excise

• 2025 (4) TMI 815
  Violation of principles of natural justice - denial of the opportunity for cross-examination of witnesses whose statements were relied upon by the Revenue to substantiate allegations against the appellants - Section 9D of the Central Excise Act, 1944 - HELD THAT:- The entire case has been build on the basis of statements of witnesses as well as the documents supplied by the source manufacturers. Further, the appellants from the very beginning has requested the adjudicating authority as well as the Commissioner (Appeals) to allow cross-examinations of all those persons whose statements have been relied upon against them, but the cross-examinations have been denied by the Revenue without any justified reasons. This Tribunal in the case of M/s Lauls Ltd and ors vs. CCE, Delhi-IV [ 2023 (7) TMI 1113 - CESTAT CHANDIGARH] , after following the judgment of the jurisdictional High Court of Punjab Haryana in the case of Jindal Drugs Pvt Ltd vs. UOI [ 2016 (6) TMI 956 - PUNJAB HARYANA HIGH COURT] wherein the Hon ble High Court has categorically held that it is mandatory to allow cross-examination of material witnesses whose statements are relied upon against the assessee. Matter remanded back to the adjudicating authority for a fresh decision after affording the opportunity of cross-examination of the material witnesses and by following the procedure as prescribed in Section 9D of the Central Excise Act, 1944 - appeals are allowed, accordingly, by way of remand.

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• 2025 (4) TMI 814
  Calculation of duty payable by the appellant under Rule 8 or the 4th Proviso of Rule 9 of the Chewing Tobacco and Unmanufactured Tobacco Packing Machines (Capacity Determination and Collection of Duty) Rules, 2010 - abatement of duty under Rule 10 due to non-production for a continuous period of more than 15 days - effective rate of enhancement of duty. Whether in the facts and circumstances of the case, the duty shall be payable by the appellant under Rule 8 of Chewing Tobacco and Unmanufactured Tobacco Packing Machines (Capacity Determination and Collection of Duty) Rules, 2010 or 4th Proviso of Rule 9 of the said Rule, or not? - HELD THAT:- The issue in these appeals have been dealt by this Tribuinal in the case of Trimurti Fragrances Private Limited Vs. Commissioner of Central Excise, Delhi III [ 2015 (8) TMI 34 - CESTAT NEW DELHI] , wherein this Tribunal has observed that The appellant in this case had used the four new machines installed w.e.f. 24-7-2013 for manufacture of the pouches of the new RSP - Rs. 4 per pouch, which was not being earlier manufactured by them and, therefore, the provisions of this Proviso would be squarely applicable. Therefore, in respect of these four machines, the duty at the rate applicable for the MRP of Rs. 4 would be chargeable only for 8 days from 24th July to 31st July and not for the entire month. The appellant have discharged duty liability on this basis only. Therefore, we hold that the duty demand of Rs. 1,51,35,483/- confirmed against the appellant on the basis that in respect of these 4 machines, the duty would be chargeable for the whole month, is not sustainable. In the case of Arora Tobacco Private Limited Vs. Commissioner of Central Excise Service Tax, Jaipur I [ 2019 (1) TMI 901 - CESTAT NEW DELHI] , this Tribunal relying on the decision of the Hon ble Gujarat High Court in the case of M/s Thakkar Tobacco Products Private Limited [ 2015 (2) TMI 606 - CESTAT AHMEDABAD] , held that the duty shall be payable in terms of 4th Proviso to Rule 9 of the Rules. The appellant is liable to pay duty in terms of 4th Proviso to Rule 9 of the Rules. Effective date of enhanced rate of duty - HELD THAT:- The duty is not payable on enhanced rate of duty w.e.f.17.03.2012 in the Appeal No.E/75381/2014 in terms of Proviso 5 of Rule 9 ibid as the said proviso does not contemplate the scenario where the manufacturer permanently discontinues manufacture of the goods on the said retail sale price during the month. As the appellant has paid the duty in terms of 4th Proviso to Rule 9 of the Rules, therefore, no demand is sustainable against the appellant. Conclusion - i) The appellant is liable to pay duty in terms of 4th Proviso to Rule 9 of the Rules. ii) The appellant is entitled to abatement under Rule 10 for the non-production period from 15.03.2012 to 31.03.2012. iii) The enhanced duty rate effective from 17.03.2012 was not applicable as production had ceased before this date. Appeal disposed off.

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• 2025 (4) TMI 813
  CENVAT Credit - transportation of goods by Indian Railways based on railway receipts - Rule 9 of the CENVAT Credit Rules, 2004 - HELD THAT:- It is observed that the Appellant has been availing CENVAT Credit in respect of transportation of goods by Indian Railways in accordance with Rule 9 of the CENVAT Credit Rules, 2004 on the basis of railway receipts issued by the Indian Railways. With effect from 27.08.2014, sub-rule (fa) has been inserted in Rule 9 (1) of the CENVAT Credit Rules, 2004. This certificate is an additional document prescribed for allowing the CENVAT Credit. That does not mean that railway receipts, which contain all the necessary details required for availing the Credit, on the basis of which the Appellant had availed the credit, cannot be considered as a document for availing CENVAT Credit. It is observed that even after the introduction of sub-rule (fa) in Rule 9 (1) of the CENVAT Credit Rules, 2004, railway receipts containing all the relevant factual details continue to be a relevant document for availment of credit. The STTG Certificate issued by the Railways has been prescribed as a document for availing credit with effect from 27.08.2014. However, railway receipts, which contain all details as prescribed under Rule 9 of the CENVAT Credit Rules, 2004, continue to be a relevant document for availment of credit. In the present case, the Appellant has availed the credit on the basis of railway receipts which contained all details as required under Rule 9 of the CENVAT Credit Rules, 2004 for availing the CENVAT Credit. Accordingly, the Appellant is eligible for availing the credit amounting to Rs.15,86,077/- - the impugned order is set aside. Demand of interest on the amount of Rs.1,16,54,325/- - HELD THAT:- The said credit has been allowed by the ld. adjudicating authority on the basis of the STTG Certificate furnished by the Appellant. Thus, there is no irregularity in the availment of such credit. Accordingly, the demand of interest on the credit allowed is not sustainable. Consequently, the demand of interest on the amount of Rs.1,16,54,325/- allowed as credit in the adjudication order. Conclusion - i) The CENVAT Credit amounting to Rs.15,86,077/- availed in respect of transportation of goods by Indian Railways on the basis of railway receipts is allowed. ii) No interest is liable to be paid by the Appellant in respect of the amount of credit of Rs.1,16,54,325/- which was allowed in the Order-in-Original. Appeal disposed off.

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• 2025 (4) TMI 812
  100% EOU - refund of unutilized CENVAT credit in relation to High Speed Diesel (HSD) and credit of Service Tax paid on Security Services - HELD THAT:- Since the issue of the refund claim of Cenvat credit of duty of Rs. 41,38,128/- paid by the appellant, while procuring HSD for their EOU is covered in favour of the appellant in their own case, the refund claim is sustainable. As regards the rejection of refund claim of Cenvat credit Rs. 2,42,192/- paid on security services, as held in catena of cases including Qualcomm India Pvt., Ltd. [ 2021 (11) TMI 72 - TELANGANA HIGH COURT] , once it is admitted as eligible credit and if the respondent has reason to believe that, it is wrongly availed, Respondent could have proceeded against the appellant under Rule 14 Cenvat Credit Rules, 2004 for the recovery of irregular CENVAT credit and cannot adjudicate the same while processing the refund claim, hence this refund claim is also sustainable. Appeal allowed.

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• 2025 (4) TMI 811
  Recovery of Cenvat credit on duty-paid M.S. plates that were subjected to processes such as cleaning, drilling holes, etc., by their Jamshedpur unit - HELD THAT:- The issue is no more res-integra and covered by the judgment of this Tribunal in a series of cases including the case of Novozymes South Asia Pvt. Ltd. v. CCE, Bangalore-I [ 2024 (5) TMI 324 - CESTAT BANGALORE] . This Tribunal after referring to the judgment of the Hon ble Supreme Court in the case of Sarvesh Refractories Pvt. Ltd. Vs. CC.Ex. Customs [ 2007 (11) TMI 23 - SUPREME COURT] and CCE Vs. MDS Switchgear Ltd., [ 2008 (8) TMI 37 - SUPREME COURT] held that once the duty paid character of inputs had not been questioned, in the hands of the manufacturer when the duty was paid, the same cannot be questioned in the hands of the receiver. In the present case, the duty paid on the M.S. Plates at the Jamshedpur unit was held to be regular and Tribunal at Kolkata allowed cenvat credit on the inputs availed by the Jamshedpur unit. The present Show-cause notice has been issued by Dharwad unit for denial of the credit as a follow-up action of the Notice issue to their Jamshedpur unit - In the present case, since the credit availed by Jamshedpur unit has been held to be regular and admissible, therefore, the credit availed by the Dharwad unit cannot be denied. Appeal allowed.

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