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Home e-Newsletters Index Year 2021 April Day 5 - Monday

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TMI Tax Updates - e-Newsletter
April 5, 2021

Case Laws in this Newsletter:

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



Highlights / Catch Notes

    GST

  • Invocation of bank guarantee furnished by the petitioner for release of the goods - If the petitioner files statutory appeal challenging the order at Ext.P3 within the prescribed period of limitation, then the respondents should not invoke bank guarantee furnished by the petitioner for a period of one week after filing of the statutory appeal - HC

  • Rate of tax - Composite supply of Works Contract or not - supply of erection, commissioning and installation of ZLD plant along with O&M services for a period of 5 years - t service of supply, erection, commissioning and installation of waste-water pretreatment plant qualifies as Composite supply of Works Contract as defined in clause (119) of section 2 of the Central Goods and Services Tax Act, 2017. - the services of setting up of ZLD plant supplied to KPCL by the applicant are classified under SAC 9954 and liable to tax at the rate of 12% of GST - AAR

  • Income Tax

  • Capital gain computation - Not allowing the deduction of cost of improvement - The assessee has not brought on record any document to show that this cost was paid by the assessee. The benefit of indexed cost of improvement can only be claimed where the cost has been actually incurred by the assessee till the date of sale. - AT

  • Profit in the business of development - method of determining the profit - Merely because assessee had followed an unrecognised method to compute taxable income in the immediately preceding and succeeding assessment year, cannot be an estoppel under the statute to correct the mistake that has crept in. - AO was duty-bound to correct the method of computation of income by adhering to either of recognised accounting standards. - AT

  • Exemption u/s 11(1A) - It is true that the claim was not made in the return of income. It is equally true that revised return of income was also not filed. In our considered view, a legal claim can be made at any stage and the decision of the Hon'ble Supreme Court [supra] relied upon by the ld. CIT(A) does not put any fetter on the appellate authorities. - AT

  • Addition of advance received u/s. 2(22)(e) - The commercial transaction between the related company do not necessarily attract the provisions of Section 2(22)(e) unless convincingly proved that the transactions were not commercial in nature by bringing appropriate material on record and with proper investigation. I - AT

  • Interest expenditure disallowance u/s 36(1)(iii) - The term ‘put to use’ applies to capital asset only because capital asset is held to facilitate the business activity and sometimes it needs to be prepared after its acquisition for being used to facilitate business activity. As against this, purchase and holding of inventory itself is a business activity. - AT

  • Additions towards excessive wastage as making charges - AO as well as learned CIT(A) were erred in estimating making charges mere relying upon statements of two goldsmiths recorded at the back of the assesse, even though the assessee has demonstrated with evidences that statement given by goldsmiths was incorrect. Further, the learned CIT(A) was also not justified in ipso facto, affirming version of the AO without giving due credence to the facts put forth by the assessee. - AT

  • Order passed by the AO u/s 143 (3) read with section 144C (1) titling it as “Draft Assessment Order” - AO while passing the impugned order, issued the demand notice u/s 156 - it is mandatory for Ld.AO to follow the procedures laid down under section 144C in an assessment that involves assessment of international transaction. - such orders passed by the Ld.AO without following due process of law are liable to be set aside. - AT

  • Exemption u/s 54F in respect of investment made in a house property in USA (foreign country) - In the light of the judgment delivered by Division Bench of this Court, as the controversy involved has already been adjudicated, the questions of law are answered against the revenue and in favour of the assessee. - HC

  • Reopening of assessment u/s 147 - The tabulations indicates that during some of the months there were less than 10 workers employed by the petitioner. Therefore, there is sufficient ground for re-opening of the assessment under Section 148 read with 147 of the Income Tax Act, 1961. Therefore, no merits in the writ petition as far as the Assessment Year 2006-2007 is concerned. - HC

  • Capital gain tax - cost of acquisitionn - the long terms capital gains has to be from the date from which the capital asset in question was held by the previous owner and the indexed cost of acquisition also has to be determined on the very same basis, consequently, the indexed cost of acquisition has to be computed with reference to the year in which the previous owner first held the asset and not the year in which the assessee became the owner of such asset. - AT

  • Exemption u/s 11 - Educational activiity u/s 2(15) - CIT-A treated the income from recording studio as business income under section 11(4A) treating the income from recording studio as business income under section 11(4A) - The trust deed is to be read as a whole - Benefit of exemption allowed - AT

  • Customs

  • Refund of SAD - SEZ unit - The authorities seems to have rejected Refund claims by O-I-O and then by O-I-A dated. 12-09-2018 for one or the other unjustified & unwarranted reasons. - also, Refund claims were filed in permitted time limit of one year. - claimant also becomes eligible to get interest after three months from the date of filling refund application. - AT

  • Waiver of demurrage, rent and detention charges - The goods could not released only for the reason that they were detained by the customs authority. - the importer cannot be fastened with any liability whatsoever. The statutory scheme is very clear. - However, warehousing entity cannot be left remediless - if there is any delay due to Court, the maxim 'actus curiae neminem gravabit' will become applicable. Whether the warehousing entity has to be compensated and if so, by whom and what will be quantum of damages are issues that will have to be determined in the lights of the facts obtaining in each case. If the Court cannot undertake the exercise of confiscation, it can mandate the customs authorities to do it. - HC

  • Service Tax

  • Failure to pay Service Tax - Penalty on the office bearers - In view of the definition of company in Section 3 of Companies Act that the appellants Society is not a Company but a Co-operative Society whose affairs are to be handled by a committee of office bearers having a life span of five years. It is also apparent from the record that the impugned period of demand has two different set of office bearers. Seen from any stretch of imagination the penalty cannot be imposed upon all of them - once the penalty is imposed upon the appellants Society, none other can be burdened with the penalty for the same omission as is alleged against the Society. - AT

  • Extended period of limitation - It is observed that admittedly appellant was regularly filing its return and was discharging the duty liability. There is nothing on record to prove the alleged concealment of any material information by the appellant from the Department. Admittedly there had been a routine audit of the appellants conducted by the Department. The question of concealment or suppression of any relevant information does not at all arise on part of the appellant. Thus extended period cannot be invoked. - AT

  • Central Excise

  • 100% EOU - Refund of unutilized Cenvat credit availed on inputs/input services - export of goods - appellant had not physically exported their goods but cleared the same to another EOU - physical export or not - The impugned order denying the cash refund is not sustainable in law and the appellant is entitled to cash refund as per sub-section 3 and sub-section 6(a) of Section 142 of CGST Act - AT

  • CENVAT Credit - sale of discarded scrap, i.e. used empty drums and empty bags - applicability of Rule 6 (3) - the said Rule has wrongly been invoked in case of the appellant for demanding the reversal of Cenvat Credit availed by him at the rate of 6% of the value of empty packets of raw-material and empty drums of the oils used by the appellant in manufacture of PP woven fabric when cleared for consideration - AT

  • CENVAT Credit - input services - nexus with the output goods - expenses incurred in relation to after sales service - as long as services of TVSFS in relation to financing of the vehicles manufactured by the assessee promotes the sale of vehicles manufactured by the assessee, such service is taxable under Business Auxiliary Services. - Credit was rightly allowed - HC

  • Rejection of refund claims - The finding of fact recorded by the Commissioner of Appeals in respect of the fulfillment of the requirement under Notification No. 20/2007 dated 25.04.2007 by the petitioner, in view of the dismissal of the Revenue appeals by the CESTAT has attained finality. Such findings of fact cannot be unilaterally disregarded by the Departmental Officer merely because it was not agreeable to them. - HC

  • VAT

  • Restriction on Input tax credit - job-work - The amended Rule 133 came into force w.e.f., 1.4.2006 and provides that where a registered dealer carries on the business in taxable as well as exempted goods or exempted transactions and taxable transactions, the input tax deduction on capital goods be allowed proportionately, keeping in view the formula laid down under Rule 131 of the KVAT Rules. - HC

  • Reversal of Input Tax Credit (ITC) on furnace oil and LSHS oil - the furnace oil was used in the process of manufacturing of the final product and it has to be treated only as an input tax credit and that therefore, the input tax paid on the purchase of furnace oil can be claimed as input tax credit - HC

  • Disallowance of discount from the taxable turnover - There is no evidence that the dealer paid to the assessee the original value of the goods and not the discounted price - the authorities below have adopted a too technical an approach in disallowing the deduction of discount from the taxable turnover of the assessee. - HC


Articles


Notifications


Case Laws:

  • GST

  • 2021 (4) TMI 143
  • 2021 (4) TMI 141
  • 2021 (4) TMI 140
  • 2021 (4) TMI 134
  • 2021 (4) TMI 130
  • Income Tax

  • 2021 (4) TMI 142
  • 2021 (4) TMI 132
  • 2021 (4) TMI 131
  • 2021 (4) TMI 129
  • 2021 (4) TMI 126
  • 2021 (4) TMI 120
  • 2021 (4) TMI 116
  • 2021 (4) TMI 115
  • 2021 (4) TMI 114
  • 2021 (4) TMI 113
  • 2021 (4) TMI 112
  • 2021 (4) TMI 111
  • 2021 (4) TMI 110
  • 2021 (4) TMI 109
  • 2021 (4) TMI 108
  • 2021 (4) TMI 107
  • 2021 (4) TMI 106
  • 2021 (4) TMI 105
  • 2021 (4) TMI 104
  • 2021 (4) TMI 103
  • 2021 (4) TMI 102
  • 2021 (4) TMI 101
  • 2021 (4) TMI 99
  • 2021 (4) TMI 96
  • 2021 (4) TMI 95
  • 2021 (4) TMI 94
  • Customs

  • 2021 (4) TMI 135
  • 2021 (4) TMI 124
  • 2021 (4) TMI 123
  • 2021 (4) TMI 118
  • 2021 (4) TMI 97
  • Insolvency & Bankruptcy

  • 2021 (4) TMI 100
  • 2021 (4) TMI 98
  • Service Tax

  • 2021 (4) TMI 127
  • 2021 (4) TMI 121
  • 2021 (4) TMI 119
  • Central Excise

  • 2021 (4) TMI 138
  • 2021 (4) TMI 137
  • 2021 (4) TMI 122
  • 2021 (4) TMI 117
  • CST, VAT & Sales Tax

  • 2021 (4) TMI 139
  • 2021 (4) TMI 136
  • 2021 (4) TMI 133
  • 2021 (4) TMI 128
  • 2021 (4) TMI 125
 

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