TMI Tax Updates - e-Newsletter
April 7, 2020
Case Laws in this Newsletter:
GST
Income Tax
Customs
Corporate Laws
Insolvency & Bankruptcy
Service Tax
Central Excise
CST, VAT & Sales Tax
Highlights / Catch Notes
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GST:
Best judgment assessment u/s 62 - failure of file the GST returns - Automatic suspension of registration - Request for Cancellation of registration of dealer for filed u/s 29 - discontinuance of the business - There are no scope for interference is warranted under Article 226 of the Constitution of India, when the petitioner has a remedy of appeal as provided under the Act - HC
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GST:
Rejection of appeal as not maintainable - Appeal-able order - Filing of appeal before the Adjudication order - The expression 'order' used in sub-section (3) can in common wording can construed to be an order. The litigants do not have the acumen of legalities of the order particularly when the word 'order' is reflected in sub-section (3). - The appeal was filed on 11.10.2018 and the adjudication order dated 21.11.2018 was issued during the pendency of the appeal. The appeal could have been rectified by an amendment appropriately to be against the adjudication order. - HC
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GST:
Detention of goods alongwith the vehicle - Part B of the E-way not updated - specific case of the petitioner is that the value of goods (which are distinct and having separate HSN numbers) as per invoices is less than ₹ 50,000/- and therefore, there is no requirement of generation of E-way bills, going by Rule 138 of the CGST Rules, 2017 - Goods directed to be released subject to payment of tax and furnished bank guarantee - HC
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Income Tax:
Stay petition - recovery proceedings - petitioner is willing to deposit 15% of the demanded amount - it seems appropriate to direct the income tax officer not to press for the encashment of the demand drafts, provided the petitioner deposits at least 30% of the demanded tax within a period of one week from today. - HC
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Income Tax:
Validity of best judgement assessment u/s 144 - It is submitted that reply could not be submitted since the notice was not uploaded on the website - Violation of principles of natural justice - CIT (appeals) directed to consider the same in the first instance and, if he finds that there is a violation of principles of natural justice, pass appropriate orders. - HC
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Income Tax:
Disallowance on account of driver’s salary and fuel and lubricant expense - Addition on the ground that there was no car owned by the assessee and no satisfactory explanation in this regard was offered by the assessee to justify his claim that driver’s salary and fuel and lubricant expenses - additions confirmed - AT
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Income Tax:
Addition on Statement recorded during the course of survey u/s 133A - assessee itself has accepted the stand disclosed during the course of survey - Profit embedded in such receipts deserves to be assessed to tax. - if rate of profit disclosed by the assessee in this year is applied to this receipt. The assessee has already offered more than this amount i.e. ₹ 23 lakhs. Therefore, no further addition is required to be made - AT
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Income Tax:
Condonation of delay of 884 days - when there is a revision order and an adverse order against the assessee then why the assessee should not have filed the appeal in time, where the issue under consideration was undisputedly decided against the assessee. Considering the same, we are of the opinion that the delay is not condonable - AT
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Income Tax:
Addition u/s 68 - unexplained cash credit - Onus to prove - it is not the case that the AO was not afforded the opportunities for his comments on the additional documents filed by the assessee - the assessee failed to discharge his onus cast upon him under the provisions of section 68 - Additions confirmed. - AT
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Income Tax:
Addition u/s 68 on account of bogus long term capital gain - AO was not justified in rejecting the assessee’s claim of exemption u/s 10(38) of the Act. AO was not justified in assessing the sale proceeds of shares of KAFL as undisclosed income of the assessee u/s 68 of the Act. - AT
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Customs:
Request for Amendments and Waiver of Late Fee Charges in the Bills of Entry and regularization of Prior & Advance Bills Of Entry through e-mail procedure as facilitation during outbreak of COVID-19 - Trade Notice
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Customs:
Return of unutilised MEIS Scrips - It was submit that the Director General of Foreign Trade (DGFT) have no power to direct recovery of any amount and that even if an appeal is filed, it will not be efficacious - When an alternative remedy is provided, the petitioners will have to approach the Appellate Authority and thereafter, if orders are against them, they can definitely approach the next forum. - HC
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Service Tax:
Validity of issuance of SCN - Demand of service tax - Post GST era - It is ordered that the petitioner Company may give their detailed written submissions/written objections in the matter and the initial objections may be with regard to maintainability and lack of jurisdiction and may also advert to the merits of the matter. The 2nd respondent will afford reasonable opportunity of being heard to the petitioner through authorised counsel and consider all the contentions of the petitioner both with reference to the maintainability, lack of jurisdiction etc. as well as the merits of the matter. - HC
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Service Tax:
Recovery of service tax - construction of approach roads to weigh bridges - The present roads have been constructed to facilitate the movement of the transport vehicles to weigh bridges and is not a part of the residential complexes, therefore, its value cannot be subjected to service tax - AT
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Service Tax:
Business Auxiliary Service - the revenue cannot claim the benefit of an extended period of limitation - the mere omission to pay tax and the revenue inability to prove of any mental intent to evade taxes per se cannot result an invocation of the extended period of limitation. - HC
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VAT:
Issuance of SCN challanged - Error in the returns - There are no exceptional circumstances for interference at the SCN stage - The second reason is that writ petitioner in any case availed of the hearing in person, orders are awaited and the third reason is that there is latches on the part of the writ petitioner - Petition dismissed - HC
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VAT:
Input tax credit - Denial of ITC in the hands of purchasing dealer or recovery from the seller for failure to deposit the tax - Prior to amendment and substitution of proviso under Section 19(1) of the Act, with effect from 29.1.2016 - It is not the case of the Revenue before us that the selling dealer in the present case is a non- existent or a ghost dealer - The Revenue directed to allow the ITC in the hands of purchasing dealer - HC
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VAT:
Best Judgement assessment - in the present case it would indicate that non-availability of books of account has not been taken as a ground rather it was something which was seen and found at the time of survey, that is loading of oil cake in vehicle and the same did not match with the account books upon which the assessment has been made - demand confirmed. - HC
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VAT:
Vires of definition of dealer - validity of Section 2(15)(ix) and explanation 1 of Section 2 (33(vi)) of TNVAT - Post GST era - Mere apprehension of the petitioner does not persuade us to go into vires of the Section 2(15)(ix) and explanation 1 of Section 2 (33(vi), of Tamil Nadu Value Added Tax Act, 2006, which stands repealed.
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VAT:
Rejection of benefits/incentives admissible under the Bihar Industrial Incentive Policy, 2011 - the two arms of the State Government have to act within the stipulation present in ‘Industrial Policy, 2011’ for according benefits to these petitioners and not allow to these petitioners to either run around the corridors of the respective department or to approach this Court again specially where their admissibility to the incentives is not in question.
Articles
Notifications
GST - States-
29/2020-State Tax - dated
27-3-2020
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Gujarat SGST
Seeks to prescribe return in FORM GSTR-3B of GGST Rules, 2017 along with due dates of furnishing the said form for April, 2020 to September, 2020
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19/2020-State Tax - dated
27-3-2020
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Gujarat SGST
Other than individuals who shall undergo Aadhar Authentication w.e.f. 01.04.2020
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17/2020-State Tax - dated
27-3-2020
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Gujarat SGST
Class of persons including person who is not citizen of India exempted from Aadhar Authenticatio
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02/2020-State Tax (Rate) - dated
27-3-2020
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Gujarat SGST
Amendment in Noti. No. 11/2017-STR to reduce GGST rate on Maintenance, Repair and Overhaul(MRO) Services in respect of aircraft
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09/2020-State Tax - dated
19-3-2020
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Gujarat SGST
To exempt foreign airlines from furnishing reconciliation Statement in FORM GSTR-9C
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8/2020-State Tax - dated
5-3-2020
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Gujarat SGST
Gujarat Goods and Services Tax (Second Amendment) Rules, 2020
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1/2020-State Tax (Rate) - dated
24-2-2020
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Gujarat SGST
To amend notification No-12017- State Tax (Rate) dated 30-06-2017 so as to notify rate of GST on supply of lottery
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26/2019 – State Tax (Rate) - dated
11-2-2020
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Telangana SGST
Seeks to amend Notification No. 11/2017- State Tax (Rate), Dt. 29.06.2017
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18/2019 – State Tax (Rate) - dated
29-1-2020
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Telangana SGST
Seeks to amend Notification No. 02/2019 - State Tax (Rate), dated 09/04/2019
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17/2019 – State Tax (Rate) - dated
29-1-2020
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Telangana SGST
Seeks to amend Notification No. 26/2018-State Tax (Rate), dt. 31-12-2018
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16/2019 – State Tax (Rate) - dated
29-1-2020
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Telangana SGST
Seeks to amend Notification No. 3/2017-State Tax (Rate), Dated 29-06-2017
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15/2019 – State Tax (Rate) - dated
29-1-2020
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Telangana SGST
Seeks to amend Notification No. 2/2017-State Tax (Rate), Dt. 29-06-2017
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14/2019 – State Tax (Rate) - dated
29-1-2020
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Telangana SGST
Seeks to amend Notification No. 1/2017- State Tax (Rate), Dt. 29-06-2017
Circulars / Instructions / Orders
News
Case Laws:
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GST
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2020 (4) TMI 177
Maintainability of application - permission to file Form 'TRAN-1' by the extended date - HELD THAT:- Earlier Review Application moved by the UOI stands dismissed by this Court - Reliance placed in the case of M/S. AJAY HARDWARE INDUSTRIES PVT. LTD., VERSUS UNION OF INDIA AND OTHERS [ 2019 (12) TMI 414 - PUNJAB AND HARYANA HIGH COURT] where it was held that Merely, because the implementation has been stayed in Review by the Hon'ble Gujarat High Court, in our considered opinion, is no ground to review our judgment. Review application dismissed.
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2020 (4) TMI 176
Best judgment assessment u/s 62 - failure of file the GST returns - Automatic suspension of registration - Request for Cancellation of registration of dealer for filed u/s 29 - discontinuance of the business - HELD THAT:- The writ petition is liable to be dismissed solely on the ground of nondisclosure of the issuance of show cause notice dated 14.5.2019 which is conveniently omitted from the pleadings. Be that as it may, no explanation is forthcoming and in how and what manner the petitioner refrained himself from relying on the issuance of show cause notice. No doubt, under sub-rule (3) of Rule 22, the person who applies for a cancellation of the registration, the authorities concerned is required to pass an order in Form GST REG-19 within a period of 30 days from the date of receipt of the application. There could have been a force in the arguments, had there been no show cause notice on behalf of the Revenue. Regarding the application of the provisions of Section 62 pertaining to assessment of non-filing of the returns once the portal remain active, petitioner even if had not conducted any business, has to file the return. The returns are filed in April 2019 and not thereafter. Submission of the fresh application and cancellation is perhaps on a premise that the petitioner could not overcome the rigors of the provisions of the Act, particularly provisions of Section 62. There are no scope for interference is warranted under Article 226 of the Constitution of India, when the petitioner has a remedy of appeal as provided under the Act - petition dismissed.
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2020 (4) TMI 175
Rejection of appeal as not maintainable - Appeal-able order - Filing of appeal before the Adjudication order - detention of goods alongwith the vehicle - Invalid E-way bill - Section 129(5) of the CGST Act 2017 Kerala State GST Act, 2017 - HELD THAT:- This is a fit case where interference under Article 226 of the Constitution of India is warranted. On a plain and simple reading of the provisions of the Act, sub-section (3) of Section 129 envisages that the proper officer detaining or seizing goods or conveyances shall issue a notice specifying the tax and penalty payable and thereafter, pass an order for payment of tax and penalty under clause (a) or clause (b) or clause (c) and on payment of the amount referred to in sub-section (1) all the proceedings in respect of notice specified in subsection (3) shall be again to be concluded. The expression 'order' used in sub-section (3) can in common wording can construed to be an order. The litigants do not have the acumen of legalities of the order particularly when the word 'order' is reflected in sub-section (3). Impugned order set aside - Appeal is restored granting liberty to the petitioner to challenge the order dated 21.11.2018 in accordance with law.
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2020 (4) TMI 174
Maintainability of petition - availability of alternative remedy of appeal - cancellation of registration - closure of business - HELD THAT:- The petitioner has a remedy of appeal under Section 107 of the Act. On a plain and simple language of section 29 of the Act, even if the person stops the business resulting in cancellation of the registration, the liability accrued till such time cannot be waived or diminished. Petition dismissed.
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2020 (4) TMI 173
Detention of goods alongwith the vehicle - Part B of the E-way not updated - specific case of the petitioner is that the value of goods (which are distinct and having separate HSN numbers) as per invoices is less than ₹ 50,000/- and therefore, there is no requirement of generation of E-way bills, going by Rule 138 of the CGST Rules, 2017 - HELD THAT:- It is seen that the value of the tax and penalty demanded as per impugned Ext.P5 order is only ₹ 20,274/- and the adjudication proceedings in pursuance to the impugned Ext.P5 detention order has not been finalised as of now in accordance with the law. True that some of the abovesaid contentions urged by the petitioner more particularly, the contention based on page 2 of Ext.P7 would really deserve serious consideration at the hands of the authorities while finalizing the adjudication proceedings in pursuance to Ext.P5 detention order. This Court is of the view that taking note of the nature of the course of action now projected before this Court, the case is only at the stage of detention of the goods and the vehicle concerned and therefore, this Court is of the considered view that the abovesaid rival contentions raised by both sides need not be resolved by this Court at this stage of the matter. It is ordered that the 2nd respondent shall forthwith release the goods and vehicle detained pursuant to the impugned Ext.P5 detention order to the petitioner on the latter furnishing bank guarantee for the value of the amount of ₹ 20,274/- as shown in the impugned Ext.P5 detention order. Thereafter, the 2nd respondent will immediately take steps to ensure that the adjudication proceedings in pursuance to Ext.P5 detention order are finalized in accordance with law. Petition disposed off.
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2020 (4) TMI 171
Constitutional validity of Section 174 of the Kerala SGST Act, 2017 - Allegation that the proceedings for assessment was initiated beyond the period of limitation stipulated in the Statute - HELD THAT:- The remand of the writ petition for a fresh consideration by the learned Single Judge, on questions other than one relating to validity of Section 174 of the KSGST Act, would suffice to meet the ends of justice. Impugned order set aside - The writ petition is restored to the files of this Court.
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2020 (4) TMI 170
Rejection of refund claim - explanation to Rule 93 of the CGST Rules and MGST Rules - HELD THAT:- The respondents have not appeared despite intimation. We are adjourning this petition by a period of two weeks from today and would take up the petition for consideration on the next date. At that time, we expect the Revenue to be represented, failing which we would consider the petition on its own merits and on the basis of the submissions made in support thereof. Stand over to 29th August, 2019.
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Income Tax
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2020 (4) TMI 168
Stay petition - recovery proceedings - petitioner is willing to deposit 15% of the demanded amount in case the draft prepared by the Bank in favour of the income tax authorities are ordered to be not encashed and account is regularised - HELD THAT:- The appeals were preferred on 16th March, 2020. Though the period of limitation had not expired, but going through the circumstances resulting into preparation of the demand drafts as noticed above, the working of the Cooperative Society has come to a halt. Instead of directing the Tribunal to decide the application firstly, I deem it appropriate to issue directions to the Tribunal to decide the appeals within some time line and in order to enable the petitioner it seems appropriate to direct the income tax officer not to press for the encashment of the demand drafts, provided the petitioner deposits at least 30% of the demanded tax within a period of one week from today. On receipt of the aforementioned tax, the demand drafts would be cancelled. The petitioner shall be permitted to transact the Bank account maintained with the Bank. The Tribunal in such circumstances shall endeavour to decide the appeals within a period of six months. Till such time this arrangement will continue.
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2020 (4) TMI 167
Validity of best judgement assessment u/s 144 - It is submitted that reply could not be submitted since the notice was not uploaded on the website - Violation of principles of natural justice - HELD THAT:- Petitioners stated in the grounds of appeal he has not raised the grounds now urged before this Court before the Appellate Authority. Therefore, it would only be appropriate that a direction is given to the petitioner to file the additional grounds now raised regarding the violation of principles of natural justice and a further direction is given to the CIT (appeals) to consider the same in the first instance and, if he finds that there is a violation of principles of natural justice, pass appropriate orders. If the Officers find that there is no violation of principles of natural justice, then the said Officer may proceed to examine the appeals. The additional grounds of the appeal will have to be filed before the Commissioner of Income Tax appeals on or before 17.03.2020. If it is filed within the said date, the Commissioner of Income Tax may take up those additional grounds for enquiry on or before 30.03.2020, but subject to availability of records and any other administrative reasons.
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2020 (4) TMI 166
Disallowance on account of driver s salary and fuel and lubricant expense - Addition on the ground that there was no car owned by the assessee and no satisfactory explanation in this regard was offered by the assessee to justify his claim that driver s salary and fuel and lubricant expenses - HELD THAT:- At the time of hearing before the Tribunal nothing has been brought on record by the ld. counsel for the assessee to establish that these expenses were wholly and exclusively incurred for the purpose of his business. Keeping in view the same as well as for the specific reasons given by the AO, it is of the view that the disallowance made by the AO on account of driver s salary and fuel and lubricant expense was fully justified and the Ld. CIT(A) has rightly confirmed by the same. Business conference expense - HELD THAT:- As observed that organising the business conference was accepted by the AO as incidental to the business of the assessee in the field of direct selling. However keeping in view the failure of the assessee to produce the relevant documentary evidence in the form of bills and vouchers to support and substantiate the same, he disallowed the claim of the assessee for business conference expense to the extent of 50%. Keeping as the nature of assessee s business, as find merit in the contention of the learned counsel for the assessee that the disallowance of 50% made by the AO is on the higher side and it would be fair and reasonable to restrict the same to 20%. Flight booking expenses - HELD THAT:- Details given in assessment order were in respect of the employee s of the assessee and since the same were incurred wholly and exclusively for the purpose of the assessee s business, the disallowance made by the AO to that extent is not sustainable, I find merit in this contention of the learned counsel for the assessee. Keeping all including especially the nature of assessee s business, flight booking expenses are necessary for the purpose of the assessee s business and since the relevant amount of ₹ 1,37,058/- was incurred by the assessee on the travelling of his employees, there is no justifiable reason to disallow the same. Accordingly direct the deletion of disallowance made on account of flight booking expenses to the extent of ₹ 1,37,058/-.
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2020 (4) TMI 165
Addition on Statement recorded during the course of survey u/s 133A - assessee itself has accepted the stand disclosed during the course of survey by partly admitting the income at ₹ 23 lakhs - HELD THAT:- Information and not conclusive evidence on the basis of which addition can be made. But in the present case, this statement is to be appreciated keeping in mind that certain papers and diaries inventorised as Annexure-4, 5 and 6 were found and seized. The assessee itself did not dispute disclosure made by it during the course of survey, and honoured to the extent of ₹ 23 lakhs. On the strength of Hon ble Supreme Court decision in the case of S. Khader Khan Son [ 2013 (6) TMI 305 - SC ORDER] the assessee cannot pleaded that for want of sufficiency of evidence about the acceptance of on-money by it, addition cannot be made. There is sufficient evidence which has been agreed by the assessee itself confirming partly in the return of income. Therefore, we do not find any merit in the first fold of contentions. As far second fold of contentions on-money received on booking of the flats/houses would partake character of business receipts and would be treated equivalent to the amount which assessee had charged from ultimate purchasers of the house/flat. Profit embedded in such receipts deserves to be assessed to tax. The assessee has produced comparative chart showing the profit rate at 5.4% in the Asstt.Year 2010- 11 and 4.33% in the Asstt.Year 2011-12 on the total receipt it has received. The assessee has already disclosed a sum of ₹ 23,00,000/- which is 33.57% of the total disclosed amount of ₹ 68,50,000/-. Even if this amount of ₹ 68.50 lakhs is accounted for, then the profit element on this amount would come only to ₹ 3,07,565/- if rate of profit disclosed by the assessee in this year is applied to this receipt. The assessee has already offered more than this amount i.e. ₹ 23 lakhs. Therefore, no further addition is required to be made and accordingly addition of ₹ 45,50,000/- is deleted. Since we have accepted one of the alternative contentions, therefore, we need not to examine whether the partners are entitled for remuneration from the business profit, and interest on their capital contribution, because these claims were not made by the assessee in the return, rather pleaded only before the ld.CIT(A). No finding recorded by the ld.CIT(A) on this aspect. Therefore, his last alternative contention is rejected. We delete addition made by the AO. No other relief is being granted to the assessee.
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2020 (4) TMI 164
Condonation of delay of 884 days - in response to the query from the Bench what prevented steps took by the assessee for filing of the appeals before 22.05.2016, ld. Counsel, referring the revision proceedings and the orders thereof, relied heavily on the order of the CIT(A) for the assessment year 2006-07 and submitted that likely favourable relief given by the CIT(A) for this assessment year and further years under revision as well - HELD THAT:- We find the reasons given by the ld. AR for the assessee are without merits. We further find, when there is a revision order and an adverse order against the assessee then why the assessee should not have filed the appeal in time, where the issue under consideration was undisputedly decided against the assessee. Considering the same, we are of the opinion that the delay is not condonable and the reasons given by the applicability of the judgment of the Hon ble Bombay High Court in the case of Kolte Patil Developers Ltd. [ 2017 (4) TMI 1061 - BOMBAY HIGH COURT] is directly applied to this case.Accordingly, the delay is not condoned. Speculation loss in the light of amended provisions of section 43(5)(d) - assessee entered into Futures and Options (F O) trading activities and earned loss and said loss was claimed as speculation loss and not claimed the same as business profits of the assessee - CIT assumed jurisdiction u/s 263 of the Act and passed an order directing the Assessing Officer to withdraw the said relief granted to the assessee - HELD THAT:- Fresh assessment orders were made by the Assessing Officer and the loss was treated as speculative loss denied the set off against the income of other heads. These facts are identical to that of the facts of Madhuri Kotecha [ 2019 (8) TMI 1469 - ITAT PUNE] case, who is spouse of the present assessee as mentioned that the provisions of section 43(5)(d) of the Act was amended and the said amendment is found to be operational prospectively useful to the assessee - we are of the opinion that these five appeals should be remanded to the file of the CIT(A) for fresh adjudication. CIT(A) is directed to comply with the order of the Tribunal in the case of Madhuri Kotecha (supra). The assessee is also directed to demonstrate the comparability of the facts before the CIT(A) - Appeal of assessee allowed for statistical purposes
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2020 (4) TMI 163
Addition u/s 68 - unexplained cash credit - Onus to prove - HELD THAT:- We are of the view that the inaction of the AO for not collecting the details of the parties from whom the assessee has received cheque does not absolve the assessee from furnishing the details of the parties as discussed above. As such, the liability under section 68 of the Act is upon the assessee to justify the source of deposits in the manner described aforesaid. In view of the above, we hold that the assessee failed to discharge his onus under the provisions of section 68 of the Act so far as the cheque deposits in his bank account are concern. Regarding the deposits of cash, we note that the assessee has furnished the list of parties from whom he has accepted the cash in the year under consideration amounting to ₹ 1,11,26,300.00. The assessee also filed the confirmation from the parties along with the copies of 7/12 extract depicting the agricultural land held by such parties. We hold that the assessee failed to discharge his onus imposed under the provisions of section 68 of the Act. We also note that the Hon ble Apex court in the case of Tin Box Co. v/s CIT [ 2001 (2) TMI 13 - SUPREME COURT] has held that the matter needs to be set aside to the file of the AO if the assessee has filed additional evidences before the appellate authorities. We note that the Ld. CIT (A) has called for the remand report from the AO two times on the details furnished by the assessee before him. Subsequently, the Ld. CIT (A) evaluated the additional documents filed before him by the assessee and arrived at the conclusion that these documents were not sufficient enough to discharge the assessee from the onus imposed under section 68 - Thus it is not the case that the AO was not afforded the opportunities for his comments on the additional documents filed by the assessee. Accordingly, we are of the view that there is no violation of the principles laid down by the Hon ble Apex court in the case of Tin Box Company v/s CIT (Supra). We hold that the assessee failed to discharge his onus cast upon him under the provisions of section 68 of the Act. Accordingly, we do not find any reason to interfere in the order of the authorities below. Hence the ground of appeal of the assessee is dismissed.
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2020 (4) TMI 162
Addition u/s 68 - bogus LTCG - denying the exemption claimed by the assessee u/s. 10(38) - addition u/s. 69C on the presumption that commission @ 5% was paid for arranging the aforesaid bogus long term capital gain - HELD THAT:- AO failed to expose the wrong doing if any on the part of the assessee by bringing out or unraveling any nexus of assessee/broker with the purchase of shares. Further, I note that AO has not brought any evidence/material to suggest that the appellant knows any of the so-called entry operators/broker/paper companies or they have named the appellant in particular, that they have dealt with the appellant. So, it is upon mere surmise and assumption that AO says that assessee s own unaccounted cash have been given to purchasers in order to claim bogus LTCG. In order to create a tax liability in a case of this nature, the AO has to prove and establish the cash trail and the allegations, particularly in respect of the appellant, which is yet to be proved in the instant case. AO has failed to establish any link and therefore the order is based on surmises, predetermined, solely relying upon the investigation report which is general in nature and no concrete material has been brought on record proving otherwise. The assessee has furnished all evidences in support of the claim of the assessee that it earned LTCG on transactions of his investment in shares. The purchase of shares had been accepted by the AO in the year of its acquisition and thereafter until the same were sold. Since the purchase and sale transactions are supported and evidenced by Bills, Contract Notes, Demat statements and bank statements etc., and when the transactions of purchase of shares were accepted by the ld AO in earlier years, the same could not be treated as bogus simply on the basis of some reports of the Investigation Wing and/or the orders of SEBI and/or the statements of third parties. Claim of the assessee in respect of Long Term Capital Gain allowed in respect of sale of shares of M/s. Cressanda Solutions Ltd and direct deletion of addition. Since addition is hereby deleted in favour of the assessee the addition on account of commission expenses u/s. 69C of the Act for arranging LTCG is also hereby allowed in favour of the assessee. Disallowance u/s. 14A read with Rule 8D - A.O has simply invoked Sec 14A read with Rule 8D, while the appellant has contended that only those investments which yield dividend income ought to contribute to any calculation for disallowance under Rule 8D - HELD THAT:- The details being sketchy and incomplete, I do not feed any cause to interfere with the action of the Ld. A.O in making the impugned disallowance.
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2020 (4) TMI 161
Addition u/s 68 - Bogus LTCG - penny stocks - HELD THAT:- Documents furnished by the assessee and the AO having not found any defects in the documents, assessee has discharged the onus upon him to make the claim of LTCG on the sale of scrip of M/s. EIL. Assessee after purchase of shares have kept the same in the dematerialized format for more than one year and transactions happened through banking channel and both the purchase and sale happened through on line and the STT having been paid during purchase as well as the sale of the scrip, the question of denying exemption u/s. 10(38) does not arise. As relying on JAGMOHAN AGARWAL VERSUS ASSISTANT COMMISSIONER OF INCOME-TAX, CIRCLE-35, KOLKATA [ 2018 (9) TMI 416 - ITAT KOLKATA] allow the claim of LTCG and consequently the claim of that amount as exempt u/s. 10(38) of the Act. - Decided in favour of assessee.
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2020 (4) TMI 160
Addition u/s 68 on account of bogus long term capital gain - assessee s claim of Long Term Capital Gains (LTCG) on sale of those shares - HELD THAT:- On identical facts and circumstances, the assessee`s case is covered by the judgment of Co-ordinate Bench of ITAT Kolkata in the case of Sanjib Kumar Patwari(HUF) [ 2019 (1) TMI 213 - ITAT KOLKATA] evidences in support of the assessee s case clearly support the claim of the assessee that the transactions of the assessee were bonafide and genuine and therefore the AO was not justified in rejecting the assessee s claim of exemption u/s 10(38) of the Act. AO was not justified in assessing the sale proceeds of shares of KAFL as undisclosed income of the assessee u/s 68 of the Act. Ld DR for the Revenue has failed to controvert the findings of the Coordinate Bench (supra) therefore, respectfully following the judgment of the Co-ordinate Bench of ITAT, Kolkata (supra), we deleted the addition - Decided in favour of the assessee.
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Customs
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2020 (4) TMI 159
Export Promotion Capital Goods Scheme - failure to fulfill export obligation - HELD THAT:- Considering the limited nature of the relief now sought for by the learned counsel for the petitioner, which has been countenanced by the learned Standing Counsel appearing for the respondent, this Court permits the petitioner to submit the required redemption certificate to the respondent within a period of two weeks from the date of receipt of a copy of this order. On receipt of the same, the respondent shall consider the same and pass appropriate orders, in accordance with law, after affording an opportunity of personal hearing to the petitioner, within a period of four weeks thereafter. Petition disposed off.
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2020 (4) TMI 158
Return of unutilised MEIS Scrips - allegation that exporters have exported goods which was not permitted in terms of the appropriate orders passed by the competent authority - HELD THAT:- The learned counsel for the appellants would submit that the Director General of Foreign Trade (DGFT) have no power to direct recovery of any amount and that even if an appeal is filed, it will not be efficacious. It is submitted that the DGFT has already taken a stand on similar issues and therefore, it is stated that the alternative remedy is not efficacious. When an alternative remedy is provided, the petitioners will have to approach the Appellate Authority and thereafter, if orders are against them, they can definitely approach the next forum. Each case depends upon its own facts. Under such circumstances, we don't think it appropriate to entertain the writ appeals. Appeal dismissed.
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2020 (4) TMI 157
Implementation of order - It is the case of the Petitioner that the implementation of above four orders would result in Petitioner being entitled to the claim of refund - HELD THAT:- In spite of Petitioner's repeated requests, the process of implementing these four orders has not even been commenced. The Respondent Nos.2 and 3 have not taken any steps to process the refund applications though the Petitioner has filed those applications on 13 September 2016. Respondent Nos.2 and 3 are directed to process the refund applications of the Petitioner within a period of four weeks from today including reassessing of the bills of entry, if required under the law - Petition disposed off.
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2020 (4) TMI 134
Maintainability of appeal - rejection on the ground of non-payment of predeposit amount - HELD THAT:- It is the case of the petitioner that the petitioner had shifted his office and was not aware of the order having been passed by the first appellate authority and it was only when the impugned recovery notice was received by it through the customs broker that it came to be aware of the order passed in appeal. Thereafter, an appeal has been filed before the Customs, Central Excise and Service Tax Appellate Tribunal (CESTAT) on 06.01.2020 along with application for condonation of delay of 1930 days. The application for condonation is yet to be decided. In the meantime, as far as protection from recovery is concerned, as against a demand of ₹ 15 lakhs (approx), a sum or ₹ 4 lakhs (approx) has been remitted by the petitioner, that is in excess of the 7.5% of pre-deposit required to be made before the CESTAT - Petition disposed off.
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Corporate Laws
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2020 (4) TMI 156
Oppression and mismanagement - raising of additional shares of the company by denying right of the petitioners - challenge was made on the ground that the same was not informed to Maharani Gayatri Devi and not to the petitioners - HELD THAT:- It is evident that Rajkumar Devraj and Rajkumari Lalitya had no interest in the estate and for the purposes of these proceedings the shares of Late Maharaj Jagat Singh in the Company before 14.11.2008 - after the said demise of Late Maharaj Jagat Singh in 1997 Maharani Gayatri Devi became the absolute legatee and legal heir of Late Maharaj Jagat Singh s estate in terms of the undisputed will dated 23.6.1996. The Succession Certificate dated 19.02.2009 issued by the District Judge, Jaipur jointly in the name of Maharani Gayatri Devi and Rajkumar Devraj and Rajkumari Lalitya based on compromise/settlement deed dated 14.11.2008 relating back to 05.02.1997 i.e. the date of death of Late Maharaj Jagat Singh cannot be relied upon - Rajkumar Devraj and Rajkumari Lalitya (1st and 2nd respondents) can not claim title on the basis of succession certificate dated 19.2.2009. The alleged acts of oppression complained of by 1st and 2nd respondents occurred around 2001. Maharani Gayatri Devi on the death of Maharaj Jagat Singh on 5th February, 1997 became his sole legatee by virtue of Will dated 23.6.1996. Therefore, Rajkumar Dev Raj and Rajkumari Lalitya (1st and 2nd respondents) cannot claim inheritance on original 5050 shares to be legal heirs of Late Maharaj Jagat Singh on his death i.e. 5.2.1997. Once the claim of Rajkumar Devraj and Rajkumari Lalitya (1st and 2nd Respondent), on the total original 5050 shares of Late Maharaj Jagat Singh is determined by Hon ble High Court and Hon ble Supreme Court on the basis of Will issued in favour of Maharani Gayatri Devi and giving legatee herself bequeathed her rights in favour of Rajkumar Dev Raj and Rajkumari Lalitya, they cannot claim their right on such shares by way of inheritance on the death of Maharaj Jagat Singh, which will amount to altering the finding of Hon ble Delhi High Court and Hon ble Supreme Court - The Tribunal failed to consider the abovesaid aspects and wrongly held that Rajkumar Devraj and Rajkumari Lalitya (1st and 2nd respondents) inherited the shares of Late Maharaj Jagat Singh on 5.2.1997 on the death of Maharaj Jagat Singh. The past and concluded actions of the appellant company completed in 2001, were not open to any challenge by the contesting respondents, Rajkumar Dev Raj and Rajkumari Lalitya (1st and 2nd Respondent) who became shareholders of the company much later only on 14.11.2008/19.2.2009 - Apart from the fact that the cause of action have taken place in 2001, in absence of any explanation, the application under Section 397 and 398 of the Companies Act, 1956 filed in the year 2006 is fit to be dismissed on the ground of delay and latches. Impugned judgement set aside - petition allowed.
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Insolvency & Bankruptcy
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2020 (4) TMI 155
Maintainability of application- initiation of CIRP - deemed SCN - Appeal has been filed mainly on the ground that demand notice sent at the registered office of the Corporate Debtor, was returned with the remarks of the Postal Authorities not available . Whether deemed service of demand notice under section 8 of I B Code, 2016 is sufficient, to trigger the process U/S 9 of the Code? HELD THAT:- It is apparent that the corporate debtor has not denied the service of demand notice in its reply to the petition. It is apparent that initially, the corporate debtor took the plea that demand notice was not as per applicable Rules and Regulations. The corporate debtor in its reply further stated that it is incorrect to allege that the corporate debtor has not given a reply to demand notice and has not raised the dispute of unpaid operational debt - The Appellant has given sufficient evidence to show the delivery of demand notice. There is no specific denial of service of demand notice. The corporate debtor has itself stated that in reply to the demand notice, he had raised the dispute of unpaid operational debt. But no document is placed before us to show the existence of dispute before issuance of demand notice. Copy of invoices, demand notice, bank statement all other documents are placed before us which clearly shows that the corporate debtor failed to pay off the operational debt of more than Rs. One Lac, despite service of demand notice. It is apparent that the Application for Initiation of Corporate Resolution Process was filed on 15th September, 2018, and impugned invoices were raised between 03rd March, 2017 to 27th March, 2017. The Corporate Debtor made the last payment of ₹ 4,08,205/- partial liability on 20th June, 2017, therefore, it is apparent that petition is within statutory period of limitation i.e. 3 years. Thus we are of the considered opinion that the Adjudicating Authority erred in rejecting the application filed u/s 9 of the Code - Appeal allowed.
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2020 (4) TMI 154
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its debt - existence of debt and dispute or not - HELD THAT:- Considering the material papers filed by the Petitioner Bank and the facts mentioned, this Adjudicating Authority is satisfied that:- (a) The Corporate Debtor availed the loan/credit facilities from the Financial Creditor Bank(Andhra Bank). (b) Existence of debt is above Rs. One Lac; (c) Debt is due; (d) Default has occurred on 29-6-2012; (e) Petition had been filed within the limitation period, as the existence of debt due is found in Balance Sheet of the Corporate Debtor as on 31-3-2017 and the last payment into the account has come on 25-9-2017, whereas this petition under section 7 has been filed on 21-5-2018; (f) Copy of the Application filed before the Tribunal has been sent to the Corporate Debtor and the application filed by the Petitioner Bank under section 7 of IBC is found to be complete for the purpose of initiation of Corporate Insolvency Resolution Process against the Corporate Debtor. Hence, the present IB Petition is admitted with the following Directions/observations. The date of admission of this petition is 13-1-2020. Thus the present IB petition filed under section 7 of the IBC stands admitted on 13-1-2020 - Moratorium declared.
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2020 (4) TMI 153
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its debt - existence of debt and dispute or not - Time limitation - HELD THAT:- In the present matter, the Petitioner Bank in its written submission has made effort to impress upon us that even . the date of default is 30-6-2012, but since the memorandum of deposit of title deeds were executed on 30-10-2010 and further extension of equitable mortgage date is 15-10-2011 then as per the counsel, the limitation period would be twelve (12) years as per article 62 of the Limitation Act and would be applicable from the date of default, i.e. 30-6-2012. Hence, the present petition is filed well within the limitation. The date of default in the present matter is 30-6-2012 being the date of NPA the limitation would commence from such date and as per the Article 137 of the Limitation Act which prescribe only three (3) years of time while the present LB. Petition was filed on 15-9-2017 before this Bench. Hence, it is clearly time-barred by the limitation. The present Petition is liable to be rejected based on time-barred claimed/debts.
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2020 (4) TMI 152
Validity of Resolution Plan - section 60(5)(c) of the of the Insolvency Bankruptcy Code, 2016 - HELD THAT:- It appears that these suspended directors will not get anything out of those Resolution Plans or some other plans, because the debt exposure admitted against this company is around ₹ 64 crore, as to liquidation value of the company, it is only ₹ 21 crore including the property in dispute with regard to High Tension Line passing through the property held by the Corporate Debtor. These suspended directors/allegations are in respect to assumed grievances of the persons, whoever fails to show that worth of each of these companies is more than ₹ 10 crore. The homebuyers, whose suffering he is talking of, they are not present before this Bench, their names are also not known to these suspended directors. As to Performance Guarantee, it will be dealt with at the time of dealing with the Resolution Plan coming before this Bench for approval. Application dismissed.
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2020 (4) TMI 151
Liability of Director of the company - it appears that R1 is the mother of R2. These two are making allegations against each other, by R2 saying that she came into the company only in the year 2016, therefore she cannot be held responsible and R1 saying that she being aged about 80 years, she has not been dealing with the management of the company though continuing as director of the company - HELD THAT:- It is evident that since R2 subsequently resigned as director and Rl has continued as director until before this petition is admitted, the books of the Corporate Debtor must be lying either with Rl or R2. Instead of providing documents, Rl and R2 are not expected to make allegations against each other ignoring their duty to handover the books of the Company to the Applicant on the Application filed on 30.09.2019. Till date, these two Respondents have not provided information in full that has been sought by the RP - On the other hand, the RP says that though already 268 days of CIRP period is over, he is unable to proceed with CIRP because information that is required to proceed further has not come so far. RP further says that ten hearings have been provided to these Respondents, but so far information required for discharging his functions has not come forth from these Respondents. It is evident that these Respondents have neither produced the books of the company nor at least furnished the information enabling the RP to locate books of the Corporate Debtor - unless appropriate directions are given in this matter, RP will not be in a position to proceed further in discharging his functions - The police authorities concerned are directed to assist the RP in getting information that is required for him to proceed with in discharging his functions as RP of this Corporate Debtor - application disposed off.
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2020 (4) TMI 150
Maintainability of application - initiation of CIRP - main plea taken by the Appellant, Shareholder/Director of the 'Corporate Debtor' is that no opportunity was given to the Corporate Debtor to address arguments and impugned order of admission was passed on 08-11-2019 without hearing - HELD THAT:- There is nothing on the record to suggest that Mr.Rajesh Narang ('Appellant herein) was not present on that date though, plea has been taken by one of the 'Shareholder' Director of the Corporate Debtor that none appeared for the Corporate Debtor. Accordingly, such plea is rejected - On merit also, we find that the total amount sanctioned disbursed in various tranches from 26-3-2016 to 13-2-2017 by the Financial Creditor and default amount was of ₹ 39,97,98,092.27/- In any case, the default amount exceeds ₹ 1 Lakh. Even on merit, we find no ground to interfere with the impugned order of admission dated 08-11-2019. Appeal dismissed.
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2020 (4) TMI 149
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its debt - existence of debt and dispute or not - HELD THAT:- It is evident from the record that the application has been filed on the proforma prescribed under rule 4 (2) of the Insolvency Bankruptcy (Application to Adjudicating Authority) Rules, 2016 read with section 7 of the Code. We are satisfied that a default amounting to lacs of rupees has occurred. As per requirement of section 4 of the Code if default amount is one lac or more then the CIR Process would be issued. The application under sub-section 2 of section 7 is complete; and no disciplinary proceedings are pending against the proposed Interim Resolution Professional. This petition is admitted and Mr. Umesh Garg is appointed as an Interim Resolution Professional - Application admitted - Moratorium declared.
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Service Tax
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2020 (4) TMI 172
Validity of issuance of SCN - Demand of service tax - Post GST era - Case of petitioner is that the proceedings as per the said show cause notice has been initiated only as late as on 24.9.2018 after the repeal of the Chapter V of the Finance Act, 1994 and after it ceased to be in force with effect from 1.07.2017 - omission of provisions of Sections 173 and 174 of the CGST Act, 2017 - HELD THAT:- The impugned Ext.P4 proceedings dated 28.11.2019 issued by the 2nd respondent is essentially a show cause notice and the petitioner is yet to respond to the same. It is ordered that the petitioner Company may give their detailed written submissions/written objections in the matter and the initial objections may be with regard to maintainability and lack of jurisdiction and may also advert to the merits of the matter. The 2nd respondent will afford reasonable opportunity of being heard to the petitioner through authorised counsel and consider all the contentions of the petitioner both with reference to the maintainability, lack of jurisdiction etc. as well as the merits of the matter. Thereafter, after affording reasonable opportunity of being heard to the petitioner, the 2nd respondent will advert to all the above said contentions and should take a considered decision on the crucial issue as to whether the 2nd respondent has got jurisdiction in the matter, more particularly, regarding the tenability or otherwise of the above said contention raised by the petitioner that the 2nd respondent lacks jurisdiction in that regard and only if the 2nd respondent takes a considered view that jurisdiction is available, he can proceed and deal with the merits of the matter. Petition disposed off.
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2020 (4) TMI 148
Reversal of input tax credit - implementation of Inspections and VAT audit proposals - circular bearing No.3/209 (Q1/39643/2018) dated 18.01.2019 - HELD THAT:- This Court is inclined to set aside the notices impugned herein and are accordingly set aside and these writ petition stand allowed - The matters are remitted back to the respondent, who in turn, shall act strictly in accordance with the aforesaid order passed by this Court as well as the instructions given by the Commissioner of State Tax, vide circular dated 18.01.2019. Petition allowed by way of remand.
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2020 (4) TMI 147
Change in classification of service - Construction of Complex Service to Works Contract Composition Scheme - Revenue dispute tax paid under Composition Scheme, on the ground that as the appellant was paying Service Tax on the same work prior to 01.06.2007 under the Head Construction of Complex Service and hence, they cannot change their classification w.e.f. 1st June, 2007 - HELD THAT:- Reliance placed in the case of COMMISSIONER, CENTRAL EXCISE CUSTOMS VERSUS M/S LARSEN TOUBRO LTD. AND OTHERS [ 2015 (8) TMI 749 - SUPREME COURT] where it was held that that in case of composite contract, the classification will be only under the head Works Contract Service. The impugned order against the appellant demanding Service Tax short-paid stands set aside - Appeal allowed - decided in favor of appellant.
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2020 (4) TMI 146
Recovery of service tax - construction of approach roads to weigh bridges installed by the appellant at the site of the customers - HELD THAT:- The present roads have been constructed to facilitate the movement of the transport vehicles to weigh bridges and is not a part of the residential complexes, therefore, its value cannot be subjected to service tax and the appellant has rightly excluded the same from the total value of construction of weigh bridges in claiming the abatement under the respective notifications. Appeal allowed - decided in favor appellant.
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2020 (4) TMI 145
Business Auxiliary Service - appellant/assessee introduces potential consumers to the bank, and charges commission as and when the advance is made - extended period of limitation - HELD THAT:- This Court notices that this question was given up by the assessee during the hearing of the appeal; no question of law arises on this aspect. Extended period of limitation - HELD THAT:- The law is well settled that in the absence of any proven or established allegations of existence of active intent to defeat the law or to cheat the revenue [expression used in Section 11A of the Central Excise Act fraud or willful misrepresentation or suppression of facts ], the revenue cannot claim the benefit of an extended period of limitation - the mere omission to pay tax and the revenue inability to prove of any mental intent to evade taxes per se cannot result an invocation of the extended period of limitation. The invocation of the extended period is held to be bad in law. However, the revenue is entitled to collect service tax dues in accordance with law for the normal period of six months prior to the issuance of the show cause notice - Appeal allowed in part.
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Central Excise
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2020 (4) TMI 144
CENVAT Credit - inputs/capital goods - HR Plates/MS Plates/ Cheq. Plates etc. - denial on the ground that the said goods were used for supporting of structures and as such, cannot be considered as either inputs or capital goods for availment of the Cenvat Credit - HELD THAT:- The period in dispute is from 01.09.2011 to 31.08.2012. This Bench of the Tribunal, in the case of the appellant itself, on the similar set of facts, for the period 01.09.2012 to 31.07.2013 in M/S JSW STEEL COATED PRODUCTS LTD. VERSUS COMMISSIONER OF CENTRAL EXCISE, NAGPUR [2019 (2) TMI 6 - CESTAT MUMBAI] has allowed the cenvat benefit on the disputed goods. The issue arising out of the present dispute is no more open for any debate, there are no merits in the order passed by the Ld. Commissioner (Appeals) in upholding rejection of CENVAT benefit of the appellant - appeal allowed - decided in favor of appellant.
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CST, VAT & Sales Tax
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2020 (4) TMI 169
Issuance of SCN challanged - Error in the returns - TNVAT Act - HELD THAT:- This Court is not inclined to interfere in the impugned notice for three reasons. One is it is in the nature of SCN. There are no exceptional circumstances for interference at the SCN stage - The second reason is that writ petitioner in any case availed of the hearing in person, orders are awaited and the third reason is that there is latches on the part of the writ petitioner as the impugned notice is dated 25.02.2019, but the instant writ petition has been filed in this Court only on 29.07.2019, more than five months later that too after availing opportunity of being heard in person. Tthis Court is of the considered view that challenge to the impugned notice is bereft of merits - Petition dismissed.
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2020 (4) TMI 143
Validity of assessment order - mismatch of transactions as per the returns of the petitioner when compared with the returns of the selling dealers - TNVAT Act - The issue on merits, prima facie, stands covered by a decision of this Court in M/S. JKM GRAPHICS SOLUTIONS PRIVATE LIMITED VERSUS THE COMMERCIAL TAX OFFICER [ 2017 (3) TMI 536 - MADRAS HIGH COURT] issued by the Special Commissioner, Commercial Taxes instructing the Assessing Officers to keep all issues of mismatch in abeyance till the constitution of a proper internal mechanism within the Commercial Taxes Department to address such matters. The impugned orders are set aside and the Assessing Authority is directed to take up the assessments of two periods, viz, 2014-15 and 2015-16 to be re-done de novo in line with Circular No. 3 of 2019 dated 18.01.2019 issued by the Special Commissioner after issuance of notice to the petitioner and affording an opportunity of personal hearing - petition disposed off.
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2020 (4) TMI 142
Validity of assessment order - TNVAT Act - Officer has simply confirmed the assessment proposals without even a discussion as to the objections raised and responded to earlier - violation of principles of natural justice - HELD THAT:- Objections have been filed by the petitioner on 03.09.2018 in response to a pre-assessment proposal dated 24.08.2018 that have been extracted in full in the impunged order. The Assessing Authority appears to have issued one more notice on 14.09.2018, to which admittedly the petitioner did not reply. Thereafter, the Officer has simply confirmed the assessment proposals without even a discussion as to the objections raised and responded to earlier. It is evident from a reading of the impugned order that principles of natural justice stand violated. The impugned order is cryptic, non-speaking and non-application of mind is writ large thereupon. There are laches on the part of the petitioner as well who has filed the Writ Petition only now challenging an order passed in August, 2019 - the petitioner shall appear before the Assessing Authority on Friday, the 20th of March, 2020 at 10.0 a.m. without expecting any further notice in this regard along with proof of payment of 10% of the demand. If the condition is found to have been complied with, proceedings for assessment shall be taken up de novo and after hearing the petitioner, an order of assessment shall be passed within four (4) weeks from 20.03.2020. Petition disposed off.
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2020 (4) TMI 141
Input tax credit - Denial of ITC in the hands of purchasing dealer or recovery from the seller for failure to deposit the tax - right to claim input tax credit against his out put tax credit under the provisions of 19(1) of the Act - HELD THAT:- Prior to amendment and substitution of proviso under Section 19(1) of the Act, with effect from 29.1.2016, the period in question, is covered by the pre-amendment position of law and since the proviso (1) to section 19, which is prior to 29.1.2016, only requires the registered dealer namely, the purchasing dealer to establish that the tax due on such purchase has been paid by him in the manner prescribes, this fact was duly proved by the purchasing dealer in the present case and the assessing authority himself has noted the said fact, therefore, there was no question of denying the input tax credit in the hands of the purchasing dealer against out put dealer, in terms of 19(1) of the Act, as it stood for the period in question 2009-2010. Such giving of input tax credit in the hands of purchasing dealer, however does not deprive Revenue authorities to proceed against the selling dealer M/s Tvl.Classic Enterprises, to recover the tax paid by the Purchasing dealer. In the present case, for non-deposit of due tax collected form the purchasing dealer M/s.Vinayaga Agencies, the Revenue is therefore free to hold enquiry against the selling dealer and collect the Revenue from the selling dealer, which money in the hands of selling dealer, is held in trust for the State by the selling dealer. It is not the case of the Revenue before us that the selling dealer in the present case is a non- existent or a ghost dealer. The identity and registration of the selling dealer and the fact that he collected the tax from the purchasing dealer in question are duly proved on record and are not disputed. The respondent are directed to allow the ITC in the hands of purchasing dealer under Section 19(1) of the Act - appeal dismissed.
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2020 (4) TMI 140
Principles of natural justice - rate of tax - inter-state transactions - Air Compressor Pump and Spares - concessional rate denied for want of Form C - case of petitioner is that the respondent committed gross violation of principles of natural justice, since no notice was issued, enabling the petitioner to show cause or explain in person on the action of the respondent in having levied 12.5% tax on transactions that were inter-state in character for want of declarations in Form C. HELD THAT:- In terms of Section 22 (4) of the Act, the only recourse available to the respondent is to frame a best judgment assessment. In the case on hand, the respondent had accepted the figures of turnover as furnished in the returns filed by the petitioner, but computed the tax at 12.5% on interstate transactions for want of Form C declarations. Since no notice was issued enabling the petitioner to show cause or explain in person on the action of the respondent in having levied 12.5% tax on transactions that were interstate in character for want of declarations in Form C, this Court is of the opinion that the impugned order has no legs to stand. The impugned order dated 19.09.2013 passed by the respondent is directed to be treated as notice for which the petitioner shall file objections within two weeks from the date of receipt of a copy of this order - petition disposed off.
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2020 (4) TMI 139
Best Judgement assessment - Merely on the basis, that at that time of the said inspection, the books of account were not found, the SIB Officers made an assessment on the basis of best judgment and raised a tax demand of ₹ 2,36,934.00 - HELD THAT:- It is not quite correct on the behalf of the learned counsel for the revisionist to submit that the assessment has been made solely on the basis or presumption that the books of account were not available. The decision of Chawlas Bricks Fields [ 2000 (7) TMI 999 - ALLAHABAD HIGH COURT ] is on a different facts situation wherein it was only on the ground that the books of account were not available that the presumption was raised. However, in the present case it would indicate that non-availability of books of account has not been taken as a ground rather it was something which was seen and found at the time of survey, that is loading of oil cake in vehicle and the same did not match with the account books upon which the assessment has been made - Therefore, the aforesaid decision does not come to the rescue of the revisionist. As far as the other submission is concerned, the revisionist was not provided with the copy of SIB report. It will be relevant to mention that the same also does not merit consideration for the reason that this plea was neither raised by the revisionist at any point of time before the authorities nor before the appellate court below, accordingly this plea is being raised for the first time which does not countenance merit. This Court is of the opinion that there is no merit in the aforesaid revision and it is liable to be dismissed - Revision dismissed - decided against revisionist.
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2020 (4) TMI 138
Registration of petitioner - Section 61 of Rajasthan Vat Act - time limitation - HELD THAT:- Suffice it to say that the Form-14 notices relied upon by Mr. Mathur, which were issued to the assessee after the survey made in the year 2016, were for the purpose of providing it an opportunity to show cause and adduce evidence against the facts discovered during survey proceedings. It was clearly intimated in these notices that failure to furnish the information/documents without sufficient cause wound render the assessee liable to prosecution and penalty under Section 64 of the Rajasthan Vat Act - Finally, after assessing the entire facts, the Assistant Commissioner, Administration, issued an order dated 13.03.2018 directing initiation of proceedings and registration of a case under Section 61 (2) of the Vat Act against the appellant. It may be noted here that the order dated 13.03.2018 passed by the Assistant Commissioner, Administration, was never assailed by the petitioner in the writ petition. We are totally in conformity with the view expressed by the learned Single Bench that the limitation for initiating proceedings would commence only after the assessing authority arrived at a conclusion regarding the evasion/avoidance of tax - Appeal dismissed.
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2020 (4) TMI 137
Concessional rate of tax - C-Forms - inter-state purchase of High Speed Diesel Oil for use in the mining and for captive power plant start-up for manufacture of cement at their cement factory - HELD THAT:- In the M/S. THE RAMCO CEMENTS LTD. VERSUS THE COMMISSIONER OF COMMERCIAL TAXES, THE ADDITIONAL COMMISSIONER (CT) [ 2018 (10) TMI 1529 - MADRAS HIGH COURT] , this Court allowed the writ petitions filed by the assessees and directed the Revenue to permit the petitioners assessees to download 'C' forms. It is not in dispute (as submitted by the learned counsel for Revenue) that though an intra Court appeal has been preferred against Ramco Cements matter with a delay of three days, the same remains unnumbered as of today. In other words, Ramco Cements authored by a Hon'ble Judge of this Court is holding the field as of today - Post Ramco Cements matter, a similar situation came up before another Hon'ble Single Judge in M/S. SOUTHERN COTSPINNERS COIMBATORE PRIVATE LIMITED REPRESENTED BY ITS MANAGING DIRECTOR, MR. S.V. DEVARAJAN VERSUS THE STATE OF TAMIL NADU, REPRESENTED BY THE SECRETARY TO GOVERNMENT COMMERCIAL TAXES DEPARTMENT, THE PRINCIPAL COMMISSIONER COMMISSIONER OF COMMERCIAL TAXES, THE ASSISTANT COMMISSIONER (ST) , THE JOINT COMMISSIONER (ST) , CHENNAI [ 2019 (6) TMI 490 - MADRAS HIGH COURT] and the same came to be disposed of on 26.04.2019. In the said order, learned Single Judge held that till such time the order of Ramco Cements is either stayed or reversed it is incumbent upon all Assessing Authorities within the State of Tamil Nadu to apply the rationale and the principle laid down in Ramco Cements with regard to pending assessments. This position is not disputed. In the light of the trajectory, which this matter has taken at the admission stage, it follows as a natural sequitur that instant writ petition stands allowed - Petition allowed.
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2020 (4) TMI 136
Vires of definition of dealer - validity of Section 2(15)(ix) and explanation 1 of Section 2 (33(vi)) of Tamil Nadu Value Added Tax Act 2006 - According to the petitioner, the club does not fall within the definition of dealer under Section 2(15)(ix) of the TNVAT 2006, as there is no sale of any goods in the form of food, refreshments and drinks by the petitioner to its members - HELD THAT:- By the virtue of the powers conferred under Article 246A, the Parliament brought in the Central Goods and Service Tax Act, 2017 and the Integrated Goods and Services Tax Act,2017. By the introduction of the Central Goods and Service Tax Act, 2017 and the Integrated Goods and Services Tax Act,2017, the Tamil Nadu Value Added Tax 2006, has been repealed. Section 174 of the Central Goods and Service Tax Act, is the repeal and saving clause - Mere apprehension of the petitioner does not persuade us to go into vires of the Section 2(15)(ix) and explanation 1 of Section 2 (33(vi), of Tamil Nadu Value Added Tax Act, 2006, which stands repealed. This exercise at this juncture would be only academic in nature. If and when action is taken against the petitioner, it is also open to the petitioner to take appropriate steps in accordance with law. Petition dismissed.
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2020 (4) TMI 135
Rejection of benefits/incentives admissible under the Bihar Industrial Incentive Policy, 2011 - rejection on grounds that their proposal does not have the approval of the Competent Authority - HELD THAT:- The entire gamut of arguments revolves around the bogie raised by the respondent Industries department through the Director, Industries as regarding lack of approval to the proposals of the petitioners for grant of incentives under the Industrial Policy, 2011 by the Competent Authority which, according to the respondent authorities in the Industries department, would be the Head of the Government as manifest from their stand present at paragraph 12 of the counter affidavit which I have reproduced above and which understanding of the Industries department is in view of the stipulations present at paragraph 2.2 of the Notification No.128 dated 16.01.2006 issued under the Industrial Policy, 2006 - The fallacy in the objections raised and the absolute lack of foundation for obstructing the incentives admissible to these petitioners under the Industrial Policy, 2011 can be understood by the circumstances discussed hereinafter which is borne from the records of the proceedings. Where the Industrial Policy, 2011 itself is providing for the manner of consideration and disposal of the claims raised by the industrial units and is followed by a series of resolutions taken and orders passed by the State Government in its Industries department as demonstrated above and where there is no dispute that the proposals of these petitioners have the sanction of the Competent Authority under the Industrial Policy, 2011 as manifest from the enclosures to the respective writ petitions and which stands noted in the argument of learned counsel for the petitioners, where was the occasion for the Director, Industries to put a spanner by raising a bogie of nongrant of approval by the Competent Authority in reference to Clause 2.2 of the resolution dated 16.01.2006 which confirmingly was issued to implement the Industrial Policy, 2006 and has not been saved by the Industrial Policy, 2011 . In view of the legal position so settled by the Supreme Court, the orders passed by the Director, Industries impugned in the respective writ petitions are rendered whimsical, lacking application of mind and bereft of reasons. It is rather unfortunate that even when the respondents do not adversely comment on the eligibility of the petitioners to draw incentive under the Industrial Policy, 2011 , it is simply by raising a bogie of lack of approval by the Competent Authority that they seek to deprive the benefits to these petitioners even when there is no contest on the approval granted by the State Investment Promotion Board in terms of Clause 14 of the Industrial Policy, 2011 to these petitioners. State Government in its Industries department and the Commercial Taxes department directed to ensure that every incentive to which the 3 petitioners are found entitled under the Industrial Policy, 2011 shall be accorded to them within a maximum period of 3 months from today without either raising technicalities of approval or on the issue of change in payment procedure as raised by the Commercial Taxes department for in my opinion, the two arms of the State Government have to act within the stipulation present in Industrial Policy, 2011 for according benefits to these petitioners and not allow to these petitioners to either run around the corridors of the respective department or to approach this Court again specially where their admissibility to the incentives is not in question. Petition allowed.
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