TMI Tax Updates - e-Newsletter
June 9, 2018
Case Laws in this Newsletter:
GST
Income Tax
Customs
Insolvency & Bankruptcy
PMLA
Service Tax
Central Excise
CST, VAT & Sales Tax
Indian Laws
Highlights / Catch Notes
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GST:
GST - Disc Brake Pads and Shoes are required to be classified under subheading 8708 of GST Tariff, as other parts and accessories of the motor vehicles of headings 8701 to 8705 - applicable rate of GST is 28% as on date.
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Income Tax:
LTCG - reference to the DVO for determining the fair market value of the asset - Assessing Officer has no power to make a reference if the value shown by assessee is not less than fair market value
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Income Tax:
TDS u/s 195 - the search fee and license fee were distinct from each other and that the search fee received under the SA was independent of the LA and was not taxable in India as FTS under Article 12(5)(a)of the DTAA
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Income Tax:
Claim of expenditure - proof of commencement of business activity - earning of income during the year is not a prerequisite for coming to the conclusion that business is in fact carried on during the year
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Income Tax:
Deemed registration u/s 12AA - original date of application - registration is deemed to have been granted from the date of inception of the University as the delay in filing of the application was only 1 month and 25 days for which request for condonation of delay was moved - AT
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Income Tax:
Exemption u/s.10(2A)- amount received by a retired partner from its earstwhile partnership firm - assessee company was not at all partner in the said firm. - exemption cannot be allowed u/s.10(2A)- also not a capital receipt.
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Income Tax:
Sales Tax (VAT) Exemption Benefit - Nature of receipt - Sales tax incentive and excise incentive are capital receipts and hence, they are not liable for inclusion under the computation of book profit u/s.115JB - AT
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Income Tax:
Penalty u/s. 271(1)(c) - Additional income was offered voluntarily by the assessee, consequent to the notice issued u/s. 153A - no penalty can be levied in respect of the returned income which has been disclosed in the return filed in response to the notice under section 153A - AT
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DGFT:
Extension to Integrated Goods and Service Tax (IGST) and compensation Cess exemption under EOU scheme till 01.10.2018 — Amendments to Foreign Trade Policy 2015-20
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Central Excise:
Refund of double payment of duty made - appellant paid duty in the name of M/s. Kanishk Steel Industries inadvertently. On realising the mistake on the same date, they paid the same amount in their own name - the disclaimer certificate furnished by the appellant along with the refund claim - refund allowed.
Articles
Notifications
Circulars / Instructions / Orders
News
Case Laws:
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GST
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2018 (6) TMI 369
Classification of goods - rate of applicable GST - Disc Brake Pads & Brakes Shoes being used in automobiles - Whether the disc brake pads & brake shoes manufactured by the applicant deserve classification under Chapter 6813 (Friction material and articles thereof) or under Chapter 8708 of the GST Tariff (which deals with parts and accessories of the motor vehicle)? Held that:- Since mineral substances are not the principal or fundamental substance of Disc Brake Pads^and Shoes and, therefore, do not warrant classification under subheading 6813 - The Disc Brake Pads and Shoes are not excluded by Chapter 87, and are dedicated and used as parts of motor vehicles of headings 8701 to 8705. Moreover, the said items are not more specifically provided for elsewhere in the GST Tariff. For the purposes of classification under Chapter Heading 87.08, the test to be applied is: whether the goods are suitable for use solely or primarily with, articles of Chapter Heading Nos. 8701 to 8705; if the answer is in the affirmative, the goods will be classifiable under Chapter Heading 8708. Having regard to the finding that the goods in question cannot but be regarded as parts of automobiles, it has to be held that they are suitable for use primarily with articles “of Chapter Heading Nos. 8701 to 8705. It follows that the goods in question cannot be treated as falling under Chapter Heading No. 6318 and that they can properly be classified under Chapter Heading No. 8708 of the GST Tariff 2017 - Further, v Since the good in question are classifiable under Chapter Heading 8708, accordingly applicant is liable to pay GST applicable under the said Chapter Head which is 28% as on date. Ruling:- Disc Brake Pads and Shoes are required to be classified under subheading 8708 of GST Tariff, as other parts and accessories of the motor vehicles of headings 8701 to 8705 - applicable rate of GST is 28% as on date.
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Income Tax
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2018 (6) TMI 367
Validity of notice u/s 148 - validity of notice served - non striking of irrelevant columns - Held that:- The intent and purpose of the notice issued was served and there is no injustice caused to the assessee - no material was placed to show that the assessee was misled in any manner for not specifically striking the irrelevant columns - therefore, we hold that the notice issued by the AO is valid and the same is upheld - Decided against the assessee. Additions u/s 69 - unexplained amounts of loans received - Held that:- As AR argued that the addition cannot be made u/s 69, and further, submitted that the entire sum of ₹ 2,10,000/- was opening balance but not the sums received in the year under consideration. Since the assessee has not furnished the information and the relevant material was not placed before the AO to examine the issue, we are of the considered opinion that the issue should be remitted back to the file of the AO Additions u/s 69A - Held that:- Assessee has collected the sums from the clients in the name of tax and has not deposited the same to the Government account or refunded to the respective clients, it constitutes the liability against the assessee but does not form part of income - hence we are of the considered opinion that the monies received by the assessee on behalf of the clients for payment of taxes to be treated as money belonged to the clients or belonged to the Income Tax Department and the same cannot be brought to tax as income in the hands of the assessee - thus we set aside the order of the CIT(A) and delete the addition made by the AO u/s 69A. Disallowance of depreciation - Held that:- Assessee did not produce any evidence for purchase of assets and put to use for the purpose of business - thus AO made the disallowance which is confirmed by CIT(A) - hence we do not find any reason to interfere with the order of the Ld.CIT(A) and the same is upheld. Addition of cash credit - Held that:- AO made the addition after issuing the show cause notice and giving number of opportunities to the assessee. It is the obligation on the part of the assessee to comply with the notices issued and present his case by furnishing the required information. Having failed to avail the opportunities given to the assessee both before the AO and the CIT(A) the assessee cannot take ‘U’ turn and make a new argument at this stage. No evidence has been produced before us to establish that the said sums were not credited in the books of accounts. The law cannot help a person who is sleeping over his rights Sale agreement and the advance received for sale of agricultural land we unable to accept the covenants of the unregistered sale agreement as genuine unless it is supported by Registered Sale deed. In the absence of sale deed, evidencing the actual amount passed on to the assessee, the sale agreement cannot be considered as a valid evidence and the Ld.AR did not produce any evidence to establish the source of credits. - Decided against assessee Disallowance of expenditure - Held that:- Since the AO has disallowed only 15% of the expenses and the assessee failed to produce any evidence with respect to the genuineness of expenses and we find the disallowance made by AO is justified and not inclined to disturb the order of the Ld.CIT(A). Agricultural income - Held that:- As the assessee failed to furnish any evidence with regard to the land holdings with pattadar passbooks and land revenue records. The assessee also failed to produce the details of crops grown, yield, expenditure etc. Therefore, we hold that the Ld.CIT(A) is justified in confirming the addition. Investment made by the assessee in Nellimerla land - Held that:- In the instant case the sale deed was registered for ₹ 50000/- and no other evidence was brought on record by the AO to establish that the excess consideration was passed on to the vendor over and above the sale consideration recorded in the sale dee. The consideration recorded in the sale deed is to be treated as final and accordingly, the addition made by the AO is unsustainable and the same is deleted.
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2018 (6) TMI 366
Reopening of assessment - notice barred by limitation - non-residents have not filed their respective individual returns of income by disclosing the incomes from the long term capital gains - scope of amendment to sub section 149(3) - Held that:- The assessment year involved is 2007-08 and the time limit for issue of notice u/s 148 was barred by limitation on 31.10.2010. The amendment to sub section 149(3) has come into force from 01.04.2012 i.e. after expiry of time limit for issue of notice u/s 148 in the case of the assessee. Therefore, we hold that the amendment is not applicable for enlargement of the time limit for issue of notice u/s 148 and the case is squarely covered by the decision of Madhucon Sino Hydro JV Vs. DCIT [2015 (7) TMI 840 - ITAT HYDERABAD] and case of S.S.Gadgil (1997 (12) TMI 4 - SUPREME COURT). Therefore, respectfully following the view taken by the Coordinate Bench, Hyderabad, we hold that reassessment proceedings initiated by the AO in this case is also barred by limitation. - Decided in favour of assessee.
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2018 (6) TMI 365
Addition of long term capital gains on account of cost of acquisition/cost of improvement - determination of total cost of acquisition of new house for the purposes of claim of deduction under s.54F while computing LTCG on sale of plot - Held that:- The assessee has included the cost incurred towards vacating the new property from tenant amounting to ₹ 35 Lakhs as well as certain costs incurred towards repairs and renovation of the new house as part of cost of acquisition of new house in addition to original cost incurred for its purchase. The original cost of acquisition of the new house was thus increased by the assessee towards cost of removal of encumbrances and cost of repairs and renovation of new house. The cost of removal of encumbrances, we straightway find ourselves in complete agreement with the observations made by the CIT(A) dealing with issue. CIT(A) has objectively analyzed the facts existing in the case with reference to the abandonment of tenancy right as noted in earlier paras and has come to the rightful conclusion in the given set of facts. The purchase agreement itself specifies the existence of encumbrance. The assessee has also demonstrated that the original cost of acquisition was quite lower vis-à-vis fair market value having regard to the embedded encumbrance. CIT(A) has drawn conclusions in favour of the assessee based on tell-tale evidences. No reason to upset such conclusions of CIT(A). The order of the CIT(A) is thus well founded with regard to the cost incurred for removal of the tenancy rights. The objection of the Revenue on this score thus cannot be sustained and hence dismissed. Repairs and renovation expenses, we find some merits in the case made out by the Revenue. As against the total costs claimed to be incurred by the assessee amounting to ₹ 30,05,429/-, the outstanding has been shown at ₹ 14,30,638/- which is nearly 50% of the total claim. Most of the payments are admittedly made in cash and, at times, based on simple vouchers. Such huge outstanding and cash payments enjoin greater onus on the assessee. The assessee has not discharged the onus fully towards incurring of such expenses more particularly the whereabouts of substantial outstanding payments as noted above. The CIT(A) has totally omit ted to address this vital aspect. In these set of facts, the AO has fairly admitted the claim to the extent of 20% on estimated basis which stands at ₹ 6,01,085/- on a property of ₹ 19.08 Lakhs. CIT(A) has cursorily dealt with the issue and has blamed the AO for non verification which he could have done itself if he found the AO wanting on this score. In the absence of proper evidences before us towards identification of the parties involved and actual work carried out, we are unable to comment any further. A closer look at cash book filed before us unfolds quite abnormal features. The assessee has shown huge opening balances in cash book (Rs.16.68 Lakhs as on 01.04.2009) against which meager household expenses of ₹ 15000/- or thereabout claimed. The cash in hand has gone up further and at one point of time it is nearly ₹ 40 Lakhs. The pattern of cash deposits and cash withdrawals as reflected in the cash book placed before us does not inspire much confidence. The profile of the assessee and the cost of purchase of the residential house do not lend credence to the claim of the assessee for such huge repairs and renovation. The assessee could not discharge the onus for such claim as required in the given facts. CIT(A) was not justified in accepting the claim of the assessee summarily. AO, on the other hand, has rightly resorted to estimations at certain percentage which in our view is justified in keeping with the original cost of acquisition. The order of the AO as regards estimation of repairs and renovation costs deserves to be approved in supersession to the order of the CIT(A). The relief granted by the CIT(A) towards cost of repairs, renovation etc. is thus set aside and order of the AO is restored on this score. - Appeal of the Revenue is partly allowed.
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2018 (6) TMI 364
Deemed registration u/s 12AA - non granting of registration from original date of application for registration made u/s 12A - Held that:- The Revenue was required to dispose off the application for registration u/s 12A within a period of 6 months but it was not done - thus in the light of these facts and the judgments of the Apex Court in the case of CIT Kanpur Vs. Society for Promotion of Education(2016 (2) TMI 672 - SUPREME COURT) the registration is deemed to have been granted from the date of inception of the University as the delay in filing of the application was only 1 month and 25 days for which request for condonation of delay was moved - thus we set aside the order of CIT and direct him to grant registration w.e.f. 01.04.1998 - Decided in favor of assessee.
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2018 (6) TMI 363
TPA - working of margin of assessee and comparables by adopting the PLI of net margin / operating revenue - Held that:- We are inclined to restore the issue to the file of the Assessing Officer for deciding afresh after considering assessee’s claim of adopting the PLI of net margin / operating revenue and also examining working of margins submitted by the assessee. AO shall decide the issue keeping in view our observations and only after extending reasonable opportunity of being heard to the assessee. Grounds raised by the assessee are partly allowed for statistical purposes. Disallowance of employer’s contribution to provident fund and ESI - Held that:- By virtue of the amendment made to section 43B employer’s contribution to provident fund / ESI is allowable as deduction if they are paid before the due date of return of income to be filed for the relevant assessment year. The Hon'ble Jurisdictional High Court has expressed such view in case of Hindustan Organics Ltd.[2014 (7) TMI 477 - BOMBAY HIGH COURT]. We direct the Assessing Officer to allow assessee’s claim of deduction in respect of employer’s contribution to provident fund and ESI if they have been made before the due date of filing of return of income for the impugned assessment year.
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2018 (6) TMI 362
Exemption u/s.10(2A) - amount received by a retired partner from its earstwhile partnership firm - Held that:- Said section 10(2A) makes the profit of a firm assessed as such exempt in the hands of its partners. In the present case, the assessee company was not at all partner in the said firm. It had retired from the firm with effect from 01.04.2009. Hence, the amount received by a retired partner from its earstwhile partnership firm cannot at all be claimed to be exempt u/s.10(2A). Hence, we are of the considered opinion that the action of the assessing officer is quite correct in holding that assessee is not eligible for exemption u/s.10(2A). Sum received as exempt as capital receipt - Held that:- when the assessee company had not accounted for the revaluation reserve in the past when it had accrued and consciously left it in the hands of the firm, it cannot claim that the receipt in the present year relates to the above said revaluation despite the fact that assessee had retired duly relinquishing its rights and properties in the said firm. Hence, in our considered opinion, the ld. Commissioner of Income Tax (Appeals) has clearly erred in holding that this sum has been received upon retirement from the firm and it is a capital receipt. - Decided in favour of revenue
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2018 (6) TMI 361
Scrutiny assessment - Notice u/s 143(2) not served within the statutory period specified - Held that:- Without any discussion on this issue of limitation, the Ld. CIT(A)-2, Kolkata allowed ground no.1 of the assessee before him, which states that the notice u/s 143(2) of the Act was not served as the assessee within the statutory period specified under law. Hence this order is passed without application of mind. Even on the merits of the case, the developments in law on the subject and the latest orders of the Tribunal and latest judgments of the courts have not been considered by the Ld. CIT(A). Hence, we are unable to uphold this order of the Ld. CIT(A). CIT(A) has passed a mechanical order without considering the legal position and the facts of the case as brought out by the AO. Thus we set aside this appeal to the file of the AO for fresh adjudication and in accordance with law, after giving the assessee adequate opportunity of being heard.
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2018 (6) TMI 360
Disallowance u/s 14A r.w.r 8D - assessee contends that the satisfaction was not recorded by the AO giving cogent reasons for rejecting the suo-moto computation of disallowance u/s 14A - Held that:- AO cogent reason as to why he is not satisfied with the suo moto disallowance made by the assessee. The Assessing Officer’s comment that the assessee did not to maintain separate books of accounts, for the expenses incurred in relation to earning of income not includible in the ‘total income’ would tantamount to AO being of the opinion that the assessee should maintain separate books for this purpose. This is not required as per law. AO has committed an error in assuming so. - Decided in favour of assessee. Provision for leave encashment - Held that:- We set aside this issue to the file of the AO to fresh adjudication in accordance with law. The assessing officer may either wait for the judgment of Hon'ble Supreme Court in the case of Exide Industries Ltd. after HC decision [2007 (6) TMI 175 - CALCUTTA HIGH COURT] or may consider the alternative plea of the assessee that the claim be allowed on actual payment basis and if it is so done, the assessee would withdraw all the pending litigation, for all the years, wherein he sought deduction of the provision made for the leave encashment. Hence, this ground is allowed for statistical purposes. Disallowance of bad debts written off - Held that:- The term ‘Full and Final Settlement’ shown that the balance amount is not recoverable. From the above letter dated 14.02.2011 it is clear that the assessee had written off bad debts in its accounts based on cogent material. Once the bad debt is written off, it should be allowed as a deduction as held in the case of TRF Ltd.[2010 (2) TMI 211 - SUPREME COURT]. The assessee has made a provision for doubtful debts in the profit and loss account of the assessee in the earlier assessment years and hence it is clear that these amounts were taken into account by the assessee in the earlier assessment years hence the conditions specified u/s 36(1)(vii) of the Act are satisfied.- Decided in favour of assessee.
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2018 (6) TMI 359
Taxability of Executive Search Services fees - tds u/s 195 - search fee received under the SA - PE in India - Held that:- We are of the opinion that the search fee and license fee were distinct from each other and that the search fee received under the SA was independent of the LA and was not taxable in India as FTS under Article 12(5)(a)of the DTAA. It is a fact that in earlier years the AO himself had held that fees under the both the agreements were separate and that only licence fees was taxable. No hesitation in holding that the search fee could not be treated to be ancillary and subsidiary to LA, that the same did not in any way aid, promote or supplement the application or enjoyment of the right, property, or information, that the search fee received under the SA was independent of the LA and was not taxable in India. Ground of appeal is decided in favour of the assessee. Taxability of amount reimbursed to the assessee by the Indian entity for expenses incurred on its behalf - DTAA - Held that:- Following the judgement in case of DIRECTOR OF INCOME TAX (IT) – I VERSUS A.P. MOLLER MAERSK AS [2017 (2) TMI 993 - SUPREME COURT] once the character of the payment was in the nature of reimbursement of the expenses, it could not be income chargeable to tax. Moreover, freight income generated by the assessee in the assessment years in question was accepted as not chargeable to tax as it arose from the operation of ships in international waters in terms of article 9 of the DTAA. Once that was accepted and it was also found that the Maersk net system was an integral part of the shipping business which was allowed to be used by the agents of the assessee as well in order to enable them to discharge their role more effectively as agents, and the business could not be conducted without it, it could not be treated as any technical services provided to the agents - Decided in favour of assessee
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2018 (6) TMI 358
Validity of re–opening of assessment u/s 147 - Held that:- Materials on record clearly indicate that during the original assessment proceedings the Assessing Officer did raise queries with regard to the assessee’s claim of deduction under section 80IAB - Re–opening of assessment u/s 147 in both the assessment years under appeal having been made on a mere change of opinion in the absence of tangible material is legally invalid - assessment orders passed in pursuance thereto have to be declared as invalid. Disallowance made u/s 80IAB - Held that:- Assessee has been approved as a co–developer from the date of co–development agreement i.e., 28th February 2006 - in assessment year 2010–11 and 2011–12 assessing officer has allowed assessee’s claim of deduction under section 80IAB of the Act in scrutiny assessments. On perusal of material placed on record we find the aforesaid submissions of the assessee to be correct. Therefore, when under similar facts and circumstances assessee’s claim of deduction under section 80IAB have been allowed in subsequent years, there is no justifiable reason to reject assessee’s claim in the impugned assessment years. Thus, in our considered opinion, the assessee is entitled to avail deduction under section 80IAB of the Act
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2018 (6) TMI 357
TDS u/s 195 - Disallowance u/s 40(a)(i) - reimbursement of bank guarantee commission paid to non-residents - Held that:- Since the reimbursement of expenses is not taxable in the hands of payee, there is no point in compelling the assessee to still go ahead with the deduction of tax at source. This issue of non-deduction of tax at source from similar payments made to nonresidents has been decided in favor of the assessee right from AY 2003-04. - Decided in favor of assessee. Treatment of interest income - nature of income - Income from other sources or income from business - idle funds usage - Held that:- Interest mainly arose on account of fixed deposits kept with banks - since the funds were found to be surplus pending final resolution of disputes the AO had rightly assessed interest income under the head Income from Other sources - Decided against the assessee. Bank guarantee charges, travelling and conveyance of professionals and professional fees paid for the arbitration proceedings - Capital expenditure or revenue expenditure - Held that:- Assessee being a single project joint venture it cannot be said that the assessee was not carrying on business in some intervening years but in business in earlier and later years - earning of income during the year is not a prerequisite for coming to the conclusion that business is in fact carried on during the year - thus assessee is very much carrying on business in the years - ground raised by department is dismissed. Exclusion of deemed export business benefits - accrual receipts - Held that:- There is no infirmity in the order of CIT(A) for excluding the deemed export benefits which have already been taxed in the A.Y.2003-04 and Tribunal have also confirmed the action of the AO. Accordingly, there is no infirmity in the order of CIT(A) for excluding deemed export business benefits. Disallowance of 20% on travelling expenses - Held that:- All the expenses are primarily incurred in connection with the arbitration proceedings and other pending litigations. Keeping no infirmity in the order for restricting disallowance to 20% of expenses.
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2018 (6) TMI 356
Sales Tax (VAT) Exemption Benefit - Nature of receipt - revenue or capital - assessment as income - Held that:- Assessee company has received aforesaid incentives in the nature of capital receipt from the Central and State Governments in the form of sales tax exemption under the Kutch District Economic Development Encouragement Policy, 2001 formed by the Gujarat Government and refund of Excise Duty vide notification No.39/2001- C.E dated 31/07/2001 for putting up industries in the district of Kutch which was badly devastated by a high intensity earthquake. The incentives have been granted for the rehabilitation of the said district and to generate employment there so as to bring life back to the normalcy and for attracting capital investments. The basis of computation of incentives are disbursed in the form refund a excise duty/exemption of sale tax/VAT payable by the companies setting up industries in the said district (notified area). The assessee company has set up an industrial unit in the Kutch District and has received incentive for setting up an industrial unit in Kutch District in accordance with the scheme formulated by the Government. Similar receipts in the form of incentives have been held to be in the nature of capital receipt by the Appellate Authority viz. CIT(A) and ITAT in the assessee’s own case for Asst. Year 2006-07 Co-ordinate Bench has held in the matter of Genus Electrotech Ltd.[2016 (5) TMI 1136 - ITAT AHMEDABAD] that subsidies do not have any income element and therefore, they should be excluded for the computation of income u/s.115JB of the Act. Sales tax incentive and excise incentive are capital receipts and hence, they are not liable for inclusion under the computation of book profit u/s.115JB of the Act - SHREE CEMENT LTD., [2011 (9) TMI 561 - ITAT JAIPUR] - Decided against revenue
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2018 (6) TMI 355
Penalty u/s. 271(1)(c) - difference in the return of income filed before the search and the one filed on or after the search - deemed concealment - Additional income was offered voluntarily by the assessee, consequent to the notice issued u/s. 153A - Held that:- As the additional income offered by the assessee is not relating to the various items referred in Explanation 5A, there cannot be a levy of penalty u/s. 271(1)(c) of the Act. The CIT(A) confirmed the levy of penalty by placing reliance on Explanation 5A of section 271(1)(c) of the Act. Without resulting in unearthing of any unaccounted income or without making any addition in the assessment order u/s. 153A of the Act, the Assessing Officer accepted the return of income by itself. In our opinion, there cannot be levy of penalty u/s. 271(1)(c) of the Act by invoking the provisions of Explanation 5A - See SARAT CHANDRA SAHOO VERSUS DEPUTY COMMISSIONER OF INCOME-TAX, CIRCLE-2 (2) , BHUBANESWAR [2014 (10) TMI 905 - ITAT CUTTACK] - Decided in favour of assessee.
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2018 (6) TMI 354
Disallowance u/s 14A - Held that:- The disallowance under section 14A of the Act has been prescribed for segregating the expenses related to exempt income, which have been debited in computation of taxable income - the assessee has not claimed the said amount of interest of ₹ 5,88,75,200/- in the profit and loss account during the year under consideration, the question of disallowance cannot arise The amount of ₹ 7,64,000/- was invested in LIC mutual funds - once the said investment of ₹ 7,64,000/- is not part of the average value of investment, which could yield exempted income, the computation of net amount of investment of ₹ 1,50,01,500/- and subsequent working of 0.5% of said value by the Ld. CIT(A) has been made correctly and we do not find any error in the same - appeal of revenue is dismissed. Disallowance of advertisement expenses - Disallowance of commission and brokerage expenses - Choice of method of accounting - Held that:- In absence of information like advertisement expenses incurred may be related to brand development or may be related to specific projects, it is not possible for us to decide, what part of advertisement expenses were related specifically to the project and constitute cost of project. Similarly, no such information is available on record in respect of commission and brokerage expenses - thus the matter is restored to the file of the Ld. CIT(A) for deciding afresh.
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2018 (6) TMI 353
Addition u/s 68 - assessee failure to discharge of onus - Held that:- Assessee filed all the evidences before the CIT(A) such as confirmations, PANs and bank statements etc. The ld CIT(A) has recorded a finding in the appellate order that these loans were subsequently repaid during the financial years 2014-15 and 2015-16. - Decided against revenue Disallowance on account of business expenses - assessee was not having any income during the year and even the business of assessee was closed in the subsequent years - Held that:- Perusal of the P & L Account reveals that the assessee has received only interest income on refund to the tune of ₹ 22,76,433/- whereas incurred several expenses such as cost of material, huge employment cost and also depreciation which appeared to be not necessarily incurred in order to keep the assessee company alive. In our opinion when there is no activity how the stock can be consumed to the tune of ₹ 22,76,433/-. Similarly, depreciation amount of ₹ 1,77,167/- were claimed. The assessee has not filed any details before the AO but even then the Ld. CIT(A) allowed the appeal by passing a cryptic order. In our opinion, the issue needs to be examined - restore the matter to the file of AO to examine the issue afresh
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2018 (6) TMI 352
Fees u/s 234E charged in the order passed u/s 154 - Held that:- Due to diversified decisions on the issue it is held the issue was a debatable issue and therefore does not qualify as a glaring and obvious mistake apparent from record. The fees, therefore, in any case could not have been charged by rectifying the intimation made u/s 200A of the Act. No fees in any case could have been charged prior to 01.06.2015. Therefore also there was no mistake in the original intimation made in the present case u/s 200A of the Act prior to 01.06.2015, by not charging fees u/s 234E of the Act. And the same could not have been charged now by way of passing an order u/s 154 of the Act. No fees could be charged in the present case u/s 234E in the order passed u/s 154 of the Act.
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2018 (6) TMI 368
Reopening of assessment after the four year period - apportionment of loss in the same proportion as the income - application of Rule 8 - Held that:- It is relevant that the Assessing Officer while allowing the loss from PTD failed to differentiate the loss with respect to that occasioned by the sale of tea grown in the assessee's own plantations and apportion it in the same manner, the income was apportioned under Rule 8. What is discernible is that the re-assessment was initiated not on the detection of new facts which were not disclosed at the first instance but only for application of Rule 8 of the Income-tax Rules. To permit a re-assessment after the four year period, there should be failure to disclose all full and true material facts, on detection of which alone there could be proceedings u/s 147 - This element of non-disclosure we fail to see in the instant case - thus appeal is rejected - Decided in favor of assessee.
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2018 (6) TMI 303
Levy of fees u/s 234E - delay in filing TDS returns - intimation u/s 200A - Held that:- e provisions of Section 234E for levy of fees on account of late filing of TDS returns was brought on the Statute vide Finance Act, 2012 w.e.f. 01.07.2012 and also that Section 200A, which deals with the processing of TDS returns, gave no mandate to make adjustments on account of levy of fees u/s 234E prior to 01.06.2015 and that the same was brought on the Statute only vide Finance Act, 2015 w.e.f. 01.06.2015. Respectfully following the decision of the Karnataka High Court in the case of Fatheraj Singhvi (2016 (9) TMI 964 - KARNATAKA HIGH COURT), we hold that the fees levied in all the present cases u/s 234E prior to 01.06.2015 in the intimations made u/s 200A was without authority of law and the same is, therefore, directed to be deleted. All the appeals of the assessee stand allowed.
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2018 (6) TMI 351
Sale of development rights as adventure in the nature of trade - capital gains - entitled to claim deduction under section 54F - CIT's powers to enhance an assessment - Held that:- CIT(A) was not only changing the head of income but was also enhancing the assessment, since income which is assessed in the hands of assessee as per direction of CIT(A) had worked out at ₹ 49,41,225/- as against income assessed by the Assessing Officer under the head Long Term Capital Gain at ₹ 48,75,610/-. The second aspect is rate of tax. In case income is assessed under the head Long Term Capital Gain, the rate of tax is lower than the rate applied when the income is being assessed as business income. In view thereof in not giving an opportunity or any show cause notice of enhancement as required under section 251(2) the order of CIT(A) suffers from infirmity and the same cannot be sustained. After assessing income as Long Term Capital Gain, AO proposed to assess income as income from other sources, as per his comment in the remand report, which was confronted to the assessee; but when the income was assessed as business income, no notice whatsoever, was given by CIT(A). Accordingly, we hold that the enhancement made by CIT(A) does not survive. Thus, we reverse the order of CIT(A). The income was assessed in the hands of assessee as income from Long Term Capital Gain. CIT(A) has decided the issue of entitlement of claim under section 54F and held the assessee to be eligible for said claim. Revenue is not in appeal against the order of CIT(A). Accordingly, we direct the Assessing Officer to allow claim of assessee under section 54F - Decided in favour of assessee
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2018 (6) TMI 302
Penalty u/s. 271(1)(b) - failure to comply with the initial two notices given u/s 143 - ‘good compliance’ - Held that:- It is true that assessee has physical disability, restricting his movements. He has authorised the AR to appear before the AO, who complied with the notices subsequently. Even though there was failure to comply with the initial two notices given, considering that AO has completed assessment u/s. 143(3) and not u/s. 144, the subsequent compliance can be considered as ‘good compliance’ for the earlier notices given. The initial non-compliance may not result in levy of penalty, as assessee has bonafide reasons for non-compliance. AO issued only one notice and levied two penalties for non-compliance on two dates. Technically speaking, each non-compliance requires separate show-cause notice/proceeding and AO cannot levy two penalties in one single proceeding - Decided in favour of assessee.
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Customs
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2018 (6) TMI 347
Principle of jurisprudents - KVS Scheme - blanket immunity - Penalty u/s 112B on co-noticees - violation of import conditions - misuse of the exemption extended vide Sl. No.30 of Notification No.21/2002-CU - Held that:- The act committed by three of the present appellants is an act in addition to that as were committed by the remaining Noticees the appellants cannot be entitled for the blanket immunity. Otherwise also the immunity from prosecution has not been granted even to Mr. Lalit Goyal, the Proprietor of main Noticee M/s. Pioneer Soap and Chemicals. The penalty has simultaneously been imposed upon the remaining Noticees/ applicants of 127 B Customs Act. In addition, the Settlement Commissioner has granted liberty to the Revenue to take the appropriate action against the remaining Noticees i.e. the appellants herein. The benefit of KVS Scheme cannot suo moto be extended to the appellants - appeal dismissed - decided against appellant.
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2018 (6) TMI 345
Penalty on registered courier u/s 112 and 114AA of CA 1962 - misdeclaration of value and description of import goods - Import of two projectors - Held that:- The impugned order has not rendered a finding on either or both of these counts. In the absence of such a finding, reference to the provisions of governing regulations is not an adequate substitute - Mere handling in the course of professional engagement does not necessarily imply prior knowledge of liability of the goods to confiscation. That requires an independent and specific finding which is conspicuously absent in the impugned order. The SCN is also bereft of any evidence or suggestion of awareness that the goods under import are liable for confiscation. Consequently, the proceedings lack the rigor that are necessary for imposition of penalties under the sections. Penalties set aside - appeal disposed off.
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2018 (6) TMI 344
Reimport after repairs of pumps - it was alleged that three out of nine pumps were found to be not conforming with the serial numbers declared at the time of export - Held that:- The justification afforded on behalf of the appellant that the error was inadvertent has not been given due consideration by the lower authorities. Nothing has been placed on record to controvert the claim that the shipment had been effected by mistake and that the offer of re-export was not genuine - In the absence of such evidence, the finding that the provisions of section 111 of Customs Act, 1962 is invokable is not tenable in law. Likewise, the invoking of section 112 of Customs Act, 1962 - appeal allowed - decided in favor of appellant.
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2018 (6) TMI 343
Export of readymade garments or not? - violation of N/N. 45/2001-CE(NT) dated 26.06.2001 and section 11 of Foreign Trade (Development and Regulation) Act, 1992 - Confiscation - penalty u/s 114 of CA - Held that:- Single Member Bench of this Tribunal in the case of M/S NEELAM STEELS, SHRI R.P. HANDA VERSUS COMMISSIONER OF CENTRAL EXCISE, LUDHIANA [2016 (1) TMI 766 - CESTAT NEW DELHI] has held that the goods in question were exported - appeal allowed - decided in favor of appellant.
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2018 (6) TMI 342
Condonation of delay of six months and eighteen days in filing the appeal - application for out of turn hearing - prosecution of appeal before wrong forum - Maintainability of appeal - revocation of courier licence - Held that:- The appellant has given undertaking that they would prosecute the appeal only before the Tribunal and not before any other forum. On such an undertaking given by the appellant as well as the Counsel, the appeal is maintainable before the Tribunal and the delay which has occurred for prosecuting the appeal before the wrong forum is condoned and Registry is directed to take the appeal on record - Since the issue involved is revocation of courier licence, the matter needs to be decided either way at the earliest, accordingly the application for out-of-turn hearing is allowed - application allowed.
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Insolvency & Bankruptcy
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2018 (6) TMI 350
Corporate insolvency process - Approval of resolution plan - Held that:- From bare perusal of Section 31, it is clear that if the ‘Resolution Plan’ approved by the ‘Committee of Creditors’ meets the requirement as referred to in sub-section (2) of Section 30, it can be approved by the Adjudicating Authority. As the impugned Scheme dated 20th October, 2016 has not been approved by the ‘Committee of Creditors’ in terms of sub-section (4) of Section 30 of the ‘I&B Code’, it cannot be treated to be approved ‘Resolution Plan’ under sub-section (1) of Section 31. If the ‘Resolution Plan’ does not conform to the requirements of sub-section (2) of Section 30, it is to be rejected. The Appellant- Pr. Director General of Income Tax (Admn. & TPS) has pointed out that the ‘Resolution Plan’ contravenes the provisions of the Income Tax Act. If the impugned approved Scheme dated 20th October, 2016, is treated to be an approved ‘Resolution Plan’ under sub-section (1) of Section 31 of the ‘I&B Code’, it being against the provisions of the existing laws and being in violative of sub-section (2) of sub-clause (e) of Section 30 of the ‘I&B Code’ is fit to be set aside. The allegations, as made above, that the Scheme is against the provisions of the existing law, have not been disputed by the Respondents. Though, we find that the impugned Scheme dated 20th October, 2016 is illegal but in absence of our jurisdiction to exercise of powers under Section 61 of the ‘I&B Code’, being barred by limitation, it will not be desirable to set aside the impugned illegal Scheme dated 20th October, 2016. But we hold the same illegal. In absence of any provision to get the Scheme executed through any Court of Competent jurisdiction, the relevant provision(s) having been repealed, the Appellant may raise the question, if the Respondents move before any court of Law for implementation the Scheme
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2018 (6) TMI 349
Corporate insolvency process - Held that:- In the case in hand the respondent company has committed default in repayment of the outstanding amount. Moreover, the application of the financial creditor is complete and there is no disciplinary proceeding pending against the proposed IRP. We are satisfied that the present application is complete and the applicant financial creditor is entitled to claim its outstanding financial debt from the corporate debtor and that there has been a default in payment of the financial debt. As a sequel to the above discussion and in terms of Section 7(5)(a) of the Code, the present application is admitted. In pursuance of Section 13(2) of the Code we direct that public announcement shall be made by the Interim Resolution Professional immediately (3 days as prescribed by Regulations) with regard to admission of this application under Section 7 of the Code.
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2018 (6) TMI 348
Corporate insolvency procedure - whether there is‘existence of dispute’ much prior to issuance of Demand Notice under Section 8(1)? - Held that:- There is an ‘existence of dispute’ since prior to issuance of Demand Notice under Section 8(1). For the said reason the ‘Corporate Debtor’ stopped payment to ‘Operational Creditor’ for not completing the job and for sub-standard work. In fact the ‘Corporate Debtor’ imposed penalty on the ‘Operational Creditor’. In the aforesaid circumstances, we are of the view that the application under Section 9 of the I&B Code was not maintainable. The Adjudicating Authority though noticed the aforesaid existence of dispute but having failed to appreciate, we have no other option but to set aside the impugned order.
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PMLA
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2018 (6) TMI 341
Second trial under PMLA for the same offence/allegations against the appellant - Held that:- Once the appellant Sri Chandrashekhar has been acquitted by the Special Court under the Schedule Offence after the trial and no appeal has been filed by the State against the said Judgement (as informed by the parties), the appeal is liable to be allowed. The complaint under schedule offence was decided on merit after recording the evidence whereby FIR and charge sheet have been quashed by the Special Court. Once the acquittal order is passed against the appellant holding that he was not involved in the Prevention of Corruption Act and he has purchased/ acquired the properties in legal resources, the question of money laundering does not arise. The allegations are same and ECIR was registered on the basis of charge sheet. There were only two options left after acquittal, either to file the appeal against the judgement and the trial under PMLA ought to have been conducted along with the trial with the case registered under schedule offence. The respondent apparently did not make efforts in this regard.
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Service Tax
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2018 (6) TMI 340
Refund of unaccumulated CENVAT credit - export of services - Rule 5 of CCR, 2004 - rejection on the ground of time bar - payment for export services received in convertible currency - Held that:- the applications for refund claims for impugned period were filed on 07.11.2016 (The date of application seeking refund). Respective invoices are of 31.10.2015, 30.11.2015 and 30.12.2015. Thus, it is the application only of 31.10.2015, which is beyond one year of the invoice. Hence, the order of original authority to this aspect was wrong. Receiving payment for export services in convertible currency - Held that:- It is very clear that the payment in rupees from the account of a bank situated in any country (other than a member country of Asian Clearing Union or Nepal or Bhutan) is a manner of receipt of foreign exchange - In the present case, it is evident that the Indian rupees were received through the account of Deutsche Bank which is situated in foreign country. Therefore, in terms of Regulation 3 made under Section 47 of the Foreign Exchange Management Act, 1999, in the present case the foreign remittance in Indian rupees through Deutsche Bank is the receipt of payment in convertible foreign exchange. The Commissioner (Appeals) has rightly overruled the decision of Additional Commissioner rejecting the claim of refund for the export services to the claimant for want of remittance in convertible currency - refund allowed - appeal dismissed - decided against Revenue.
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2018 (6) TMI 339
Refund of unutilized CENVAT credit - Business Support Service - Business Auxiliary Service - period involved is from July, 2014 to September, 2014 - Rule 5 of CCR, 2004 and N/N. 27/2012-CE (NT) dated 18.06.2012 - Held that:- A plain reading of Rule 5 of CCR, 2004 makes it clear that when it defines export turnover of services, the assessee needs to consider only the payments received during the relevant period and certainly not the payments which are to be received for which invoices are raised during that period. The appellate authority has even though not disputed most of the findings of the adjudicating authority, only holds that the requirement of law is that the exports effected during the relevant quarter for which proceeds were be received in foreign currency in the same quarter. This is certainly not the intention of the legislation. The order of the ld. Commissioner (Appeals) in denying the refund granted by the original authority is wrong and unsustainable - the order of the adjudicating authority is restored - appeal allowed.
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2018 (6) TMI 338
Construction Service - Commercial or Industrial Construction service - scope of term 'Commercial Concern' - Non-payment of Service tax - failure to take registration - demand of service tax with Interest and Penalty - invocation of extended period of limitation - Held that:- With effect from 01.05.2006, the definition of 'Commercial or Industrial Construction service' stands amended and has been made applicable to “any person”. Consequently, the appellant will be liable for making payment of service tax w.e.f. 01.05.2006 - Since the appellant has failed to take out registration or failed to file statutory returns, the Revenue is fully justified in raising the demand by invoking the extended period of limitation available under Section 73 - the demand of service tax w.e.f. 01.05.2006 is sustained. Penalties - Held that:- The service tax demand along with interest has already been discharged by the appellant even prior to the issuance of SCN dated 19.11.2007. Consequently, the department is not justified in imposing penalties - penalties set aside by invoking section 80. The demand up to 30.04.2006 is set aside, but sustained for the period from 01.05.2006 - penalties also set aside - appeal allowed in part.
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2018 (6) TMI 337
Penalty u/s 77 and 78 - entire service tax alongwith interest before issuance of show cause notice - Construction of Residential Complex - issue in litigation during the relevant time - Held that:- The issue of taxability of the service of construction of residential complex was under challenge before the Hon’ble High Court of Bombay and it is still pending in the Hon’ble Supreme Court, therefore entire industry involved in the construction of residential complex have challenged the validity of levy of service tax on the construction of residential complex - There is sufficient cause for non payment of service tax. However on the investigation by the departmental officers, appellant even though matter was under litigation, paid entire service tax along with interest - this is fit case to set aside penalties by invoking section 80 - penalty set aside - appeal allowed - decided in favor of appellant.
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2018 (6) TMI 336
Penalties u/s 77 and 78 - Appellant did not pay service tax voluntarily but paid on being pointed out - Held that:- The Appellant after audit conducted by the revenue has paid the service tax alongwith interest before issue of SCN - there was dispute of service tax on various other services also and the demands on the said services were dropped by the adjudicating authority. The nature of services and non payment of service tax was not suppressed by the Appellant and the details were appearing in book of accounts - there is no merits in imposing penalties - penalties not sustainable - appeal allowed - decided in favor of appellant.
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2018 (6) TMI 335
Refund of service tax - denial on the ground that the Appellant did not file reply to show cause notice and also that since the Appellant paid service tax inspite of exemption, hence cannot claim refund of service tax - Held that:- It is clear that the amount of service tax paid on account of audit objection cannot be considered as to have been paid on own volition and the findings of the lower authorities in this regard are erroneous - As regard evidence to the effect that no reason was advanced by the Appellant to show why they were entitled to refund claim, the Appellant had already produced the Balance Sheet, Copy of rent agreement and certificate from the service recipient that no service tax was charged to them by the Appellant. The Appellant is entitled for the refund of amount claimed by them subject to the condition that the evidence towards non charging of service tax amount from the service recipient is produced by them before the refund sanctioning authority who shall on being satisfied with the same shall sanction the refund claim - appeal allowed by way of remand.
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2018 (6) TMI 334
Exemption from payment of service tax - Export of Services - Business Auxiliary Services - SCN issued alleging that they do not have any written agreement with the clients in this regard and the condition to treat the service as “Export of Services” with regard to nature/ place of delivery/ usage not established - Held that:- It is not disputed that the business auxiliary service was rendered to the clients situated outside India in relation to business and commerce even though the same may have resulted into sale of goods in India. However the facts remains that the service recipients were located outside India and are to be treated as “Export of Services” - the service in question fall under the category of “Export of Services” and hence exempt from payment of Service Tax - appeal allowed - decided in favor of appellant.
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2018 (6) TMI 333
Commercial or Industrial Construction Service - Civil Construction of Residential Houses & Staff Colonies - It appeared to Revenue that the said Civil Construction undertaken by M/s Padam Chand & Co., was Industrial Construction Service - Held that:- if the Civil Construction is intended for personal use of such person i.e. the owner of the property, then it does not get covered by definition of "Residential Complex Service" - the Civil Construction was to be used for residential purposes by the service recipients and therefore, the same cannot be considered to be under "Commercial or Industrial Construction Service". The demand confirmed by the Original Authority to the tune of ₹ 13,71,473/- under the provisions of Section 73A of the Finance Act, 1994 is not sustainable since the same has travelled beyond Show Cause Notice. Further, the Service Tax cannot be demanded on the goods but it can only be demanded on service and therefore, the demand of Service Tax to the tune of ₹ 14,61,137/- is not sustainable. Appeal dismissed - decided against Revenue.
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2018 (6) TMI 332
Rejection of VCES declaration - whether both the lower authorities were correct in dismissing the VCES declaration filed by the appellant on 18/12/2013 as incorrect declaration on the ground that there was an enquiry initiated against the appellant? - Held that:- It is the fact that the appellant had filed the VCES declaration on 18/12/2013 and the notice issued by the Assistant Commissioner of Service Tax - II is dated 18/08/2015 for rejection of VCES declaration - This notice was issued by the lower authority when the CBEC Circular dated 18/08/2013 was in the knowledge of the department, wherein CBEC has clearly clarified that notice for rejection of VCES scheme should be issued within 30 days - rejection of VCES not justified - appeal allowed.
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2018 (6) TMI 331
Sale of service - hiring of furniture on rent - Supply of Tangible Goods Service - appellant hire furniture on rent to visitors or participants in business exhibitions as per the requirement of the organizers and exhibitors and they are treating the same as deemed sale and paying VAT on the same - whether the respondent has provided service under the category of “Supply of Tangible Goods”? Held that:- It is an admitted fact in the Show Cause Notice, that the respondent-assessee has paid VAT on the disputed transaction. Further, the Show Cause Notice is presumptive in nature, as there is no finding and/or allegation that effective control of the goods/furniture was not given by the respondent to its customers. The definition of "Supply of Tangible Goods" as given in Section 65 (105) (zzzzj) of the Finance Act, 1994, provides that such services are for use, without transferring right of possession and effective control of such machinery, equipment and appliances. There is neither allegation nor any finding by the courts below that the right of possession and/or effective control of the furniture/equipment was not given by the respondent to its customers. Thus, the essential facts for levy of Service Tax under the category of “Supply of Tangible Goods” are wanting. SCN is vague - demand set aside - appeal dismissed - decided against Revenue.
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2018 (6) TMI 330
Reverse charge mechanism - manpower supply agency services - liability of service tax - Held that:- The service providers have discharged the entire service tax due for the services provided is not controverted by Revenue in the grounds of appeal in any form - In the absence of any evidence to controvert the factual finding that the amount of service tax due to the Government is discharged by the service providers, there is no hesitation to hold that the impugned order is correct and legal, and does not require any interference - appeal dismissed.
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2018 (6) TMI 329
Refund of CENVAT credit - various input services - rejection on the ground that appellant has not justified that these services are used for rendering of output services which are exported - Held that:- Appellants are providing Data Processing Consultancy Services which are exported by availing CENVAT Credit of the service tax paid on the services - there is no dispute as to the fact that all the services were received and utilized by the appellant during the course of rendering output services which are exported. Export of insurance service and the amount involved therein as credit of service tax paid by the service provider of the services would fall under the category of “services” which are used for providing output services by the appellant and exported - As regards the service tax credit on the insurance services, maintenance and repair services, it is found that the said services in respect of individuals are not allowed accordingly to that extent, impugned orders are upheld. Appeal allowed in part.
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Central Excise
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2018 (6) TMI 328
100% EOU - Violation of condition of notification - N/N. 23/2003-CE dated 31.03.2003 - Exemption notification is subject to the condition that the goods are manufactured wholly from the raw materials produced or manufactured in India - denial of benefit on the ground that the goods were imported and not domestically manufactured. Whether the consumables are included in the term raw materials for the purpose of N/N. 8/97-CE, and consequently if goods are cleared to DTA which are manufactured using imported consumables, is the benefit of N/N. 8/97 available to the assessee? - Held that:- Tribunal in the case of Premium Tools Pvt. Ltd. [2017 (1) TMI 290 - CESTAT MUMBAI] held that the benefit of N/N. 8/97 is available even if the final products are manufactured using imported consumables because the limitation when the notification is only that the goods should be manufactured using raw materials manufactured or produced in India. There is no restriction that the consumables which are used in the manufacture also have to be domestically manufactured - benefit of notification allowed. Whether the goods in question are raw materials or consumables? - Held that:- We find nothing in the order of Commissioner (Appeals) that the assessee had produced any evidence to substantiate their claim that these are consumables and not raw materials - Commissioner (Appeals) has erred in holding that these items as consumables merely on the assertion of the assessee without any basis to substantiate it, as the assessee has not produced any evidence to substantiate that the goods in question are consumables, we hold that the assessee is not entitled to the benefit of the notification. Appeal allowed - decided in favor of appellant.
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2018 (6) TMI 327
Clandestine removal - P or P medicaments - This show cause notice was based on the private register maintained by the manufacturing chemist, his statement as well as the statements of others recorded during investigation - retraction of statement - Held that:- In the instant case, the investigating officers have proof of clandestine production and clearance of excisable goods without payment of duty over and above the exemption limit of ₹ 1 crore. They have arrived at the production details conclusively based on the records seized and statements of production prepared by the Production Chemist from the seized records and confirmed by the husband of the proprietrix in his statement. The statements made before the Central Excise Officers are admissible only when the persons making them are examined as witnesses and the adjudicating authority is convinced that the statements should be admitted as evidence. In this case three of the persons who made the statements were examined and all three have retracted their statements. It does not appear from the records that other persons who made statements were examined by the adjudicating authority or cross examined. The department cannot prove with mathematical accuracy in the case of clandestine removal, the entire process of manufacture and sale. However, in this case, the main pieces of evidence of clandestine removal are the private register maintained by manufacturing chemist and the statements of the concerned persons. All those persons who were examined before the adjudicating authority have retracted their statements and the manufacturing chemist denied his own diary reflected the actual production. Appeal dismissed - decided against Revenue.
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2018 (6) TMI 326
CENVAT credit - inputs - spent catalyst - credit wrongly availed on Aluminium articles - Held that:- No doubt, during 2008 and 2009, the quantity of aluminium used is shown as maximum, which is sufficient to hold that during this period, only aluminium rods were used as the spent catalyst. Since the use of the select catalyst as an input for the production of final product has not been disputed, therefore, the said catalyst very clearly falls into the definition of input under Rule 2(K) of the Cenvat Credit Rules. Keeping in view the self-sufficient expansion to the discrepancy noticed in the impugned Show Cause Notice, it is held that the Commissioner has wrongly adjudicated the issue. It has absolutely been ignored by the Commissioner that admittedly aluminium materials were purchased by the Appellant as the raw material (spent catalyst) for his final product (Ferro-alloy). There is nothing on record as would justify that this is not the input under Section 2(K) of the Cenvat Credit Rules. The order under challenge is miserably silent qua the same. Appeal allowed - decided in favor of appellant.
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2018 (6) TMI 325
Refund of double payment of duty made - For the month of June, 2014, the appellant paid duty of ₹ 17,44,041/- vide challan dated 02.02.2014, in the name of M/s. Kanishk Steel Industries inadvertently. On realising the mistake on the same date, they paid the amount of ₹ 17,44,041/- in their own name - The refund has been denied stating that the amount so paid is lying in the PLA account of M/s. Kanishk Steel Industries and, therefore, the appellant is not eligible for refund. Held that:- The Hon’ble High Court of Madras, in the case of M/s. Sundaram Industries Ltd. Vs. CCE Madurai [2015 (5) TMI 416 - MADRAS HIGH COURT], had considered a similar issue, and on production of No Objection letter from the company concerned, it was held by the High Court that refund has to be granted - In the present case also, the disclaimer certificate furnished by the appellant along with the refund claim - rejection of refund is without any legal basis - appeal allowed - decided in favor of appellant.
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2018 (6) TMI 324
Clandestine removal - excesses of stock - the allegation of clandestine removal is based on difference in weight recorded in the weighment slips and those in the corresponding invoices - existence of unaccounted stock of final product - whether the seizure and confiscation of alleged excess stock is legally sustainable? - whether the appellant company is guilty of removing excisable goods clandestinely without payment of duty? - whether penalty is imposable on the appellants in these proceedings. Held that:- In absence of any corroborative tangible evidence of clandestine removal, it appears to be improper to hold the appellant guilty of clandestine removal of goods solely on the basis of difference in weight recorded in the excise invoices. There is nothing on record to justify rejection of the cogent explanation offered by the appellant–assessee before the lower authorities as regards difference in weight found in the weighment slip and a few corresponding excise invoices - It will not be proper to treat payment of duty as admission of guilt and the department cannot be allowed to rely on the irregularity committed by them. It is settled law that one cannot take benefit of its own wrong. Existence of unaccounted stock of final product, believed to be kept for clearance without entering in books - Held that:- It is found that the manner of stock verification is not in conformity with the normal accounting of such goods. There is no dispute to the fact that the goods in question is accounted for by weight and not in numbers. Therefore, physical verification of such goods by counting the number of pipes cannot be appreciated. Moreover, the conversion from numbers into Kg (weight) has been made by using formula prescribed for pipes of BIS specifications and admittedly, the assessee -appellant is manufacturing both ISI and Non ISI Pipes - the quantity of goods found in excess of the recorded stock of goods as calculated by the department in Annexure-I to the Panchnama is unverifiable and hence appears to be incorrect - seizure and subsequent confiscation of incorrectly calculated stock of finished goods is unsustainable in law. It has been consistently held in the judicial pronouncements that charge of clandestine removal is a serious charge which has to be proved by way of tangible evidence and it cannot be held on the basis of suppositions and inferences - In the present case, no investigation has been conducted by the department with the buyers or with transporters. There is absolutely no evidence of removal of goods without payment of duty by the appellant company save and except presumptions. In fact the buyers have given certificate to the effect that they had received goods as per invoice only. There is nothing on record to discard the explanation given by the appellant company as regards difference in the weight recorded in the weighment slips with the weight shown in the invoices. There is no evidence on record to even suggest that the differential quantity had been removed clandestinely - the allegation of clandestine removal of goods on the appellant company is not proved. Seizure and confiscation of goods alleged to be found in excess of the recorded stock - Held that:- The manner of physical verification of the stock adopted by the officers was improper and calculation chart showing the quantity of goods found in stock is not worthy - the allegation of existence of unrecorded final product in the stock of the appellant company is not proved - confiscation of goods as well as penalty set aside. Appeal allowed - decided in favor of appellant.
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2018 (6) TMI 323
Time limitation - Valuation - inclusion of additional discount - Revenue challenged the extra discount given to these exporters on the ground that the appellants are receiving the extra consideration in the shape of intermediate advance license and therefore, the same amount to extra consideration and needs to be included in the value of the goods cleared for the purpose of payment of duty - Held that:- Revenue wrote many letters but the appellant did not give the necessary information for issue of notice. Thus, in practical terms there was suppression of information specifically asked by Revenue - The appellant’s action in not paying duty may be bona fide but in failing to furnish information it cannot be said to be bona fide. It was with obvious attempt to scuttle or delay the issue of notice - invocation of extended period justified. Valuation - includibility of the value of the intermediate advance license of extra consideration - Held that: - It is seen from the price list of the appellant that they were offering the extra discounts subject to the buyer complying all the legal requirements for obtaining the advance license - From the remarks on the price list of the appellant, it is apparent that intermediate advance license was obtained at the desire of the appellant and thus, the argument of the appellant that the said intermediate license does not amount to consideration has no merit. Reliance placed in the decision of Apex Court in the case of IFGL Refractories Ltd. [2005 (8) TMI 112 - SUPREME COURT OF INDIA], where it was held that As the additional consideration was to flow to them as discounts, they have sold at the rates mentioned in the letter of 2nd March 1993. The "additional consideration" is the difference in prices between these two. The Commissioner had thus correctly worked out this difference. Appeal dismissed - decided against appellant.
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2018 (6) TMI 322
Valuation - Revenue found that the valuation of the goods has not been determined in conformity with the guidelines and the provisions of the CAS – 4 standards issued by the Institute of the Costs & Work Accountants of India - demand of differential duty - Revenue Neutrality - Held that:- It is absolutely clear that it was only after the enquiry by the revenue that the correct basis of valuation of goods came to the light. Had it not been the enquiry of the revenue, the actual assessable value of the goods would have remained unnoticed - In the present case when the Appellant were very well aware of the fact that they are liable to pay duty, they should have voluntarily come forward to pay duty. There is no instance which can point out that the Appellant were not aware of duty to be paid and the method of valuation of goods. However having aware of the same and then too non payment of duty cannot lead to dropping of demands on ground of revenue neutrality. The demands cannot be set aside on grounds of revenue neutrality or time bar. Further there is no reason to waive the penalty as it is not the case of non payment of duty due to lack of knowledge on the part of Appellant - appeal dismissed - decided against appellant.
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2018 (6) TMI 321
SSI Exemption - Use of Brand name of others - Held that:- The Appellate Commissioner vide his order dt. 31.08.2006 had denied the SSI exemption on the goods bearing brand name ‘Rifox’ and had sent the case back to the adjudicating authority only for limited purpose i.e to compute the demand on the goods bearing said brand name. The said order of Commissioner (Appeals) denying SSI Exemption to goods bearing brand name ‘RIFOX’ was not challenged by the Appellant before CESTAT and has thus attained finality. The Commissioner (Appeals) has rightly rejected the appeal filed by the Appellant on the ground that the Appellant should have approached the CESTAT against order-in-appeal dt. 31.08.2006. He also held that the Appellant in previous round of proceedings before the Commissioner (Appeals) nowhere stated that they used brand name ‘Rifox India’ and the evidence produced by them before him is afterthought - Once the Appellant chose not to file appeal against Order-in-Appeal dt. 31.08.2006 when the case was decided against them and the matter was remanded to the adjudicating authority only for limited purpose of recalculation of demand, they cannot challenge the merits in appeal before Commissioner (Appeals) as the Order-in-appeal has attained finality. Appeal dismissed - decided against appellant.
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2018 (6) TMI 320
Clandestine removal - raw tobacco - unaccounted quantity of raw tobacco - excesses and shortage of stock - parallel invoices - the demand is mainly based upon the records and statements made by supplier of raw material i.e tobacco which showed that the tobacco was consigned to the Appellant Unit - Cross-examination of persons - Held that:- Though the statements of these persons have been relied upon, but there is no corroborative evidence to show that the said goods reached the factory of the Appellant Unit and were consumed in manufacture of unaccounted finished goods. Only on the basis of records of some of the alleged suppliers and their statements which are of third parties, it cannot be concluded that the goods were consigned to the Appellant Unit. The Appellant had requested for cross examination of the suppliers and persons whose statements were relied upon. Either the said persons did not appear for the cross examination or the persons who appeared for cross examination have resiled from their statements. No statement of driver of any of the vehicle was recorded to ascertain the actual place where the raw material was actually delivered. There is no corroborative evidence of receipt of any unaccounted raw material by the Appellant Unit. Neither there is any evidence of unaccounted production and its removal. Further no evidence of use of other raw material/ packing material, extra labour, payment of unaccounted wages, use of power or any evidence of production is appearing. There is no buyer of such goods nor any evidence of any consideration received by the Appellant Unit against such clearance. Clearances against alleged parallel invoice - Held that:- It is found that during the cross examination of the departmental officer on questioning regarding such parallel invoice, he stated that the copies of invoices were given to him by his seniors. There is no authentic source who has provided the copies of said parallel invoice. One of the party who allegedly received the goods under the cover of two such parallel invoice in his statements refused to have received such goods. The other party in its cross examination also stated that no goods were received by them. Also the revenue could not find any other buyer of goods except the alleged parallel invoice. The search at Appellant Unit could not show excess of finished goods. In such case the allegation of clandestine production/ removal and demand of duty on finished goods does not sustain - the demands against Appellant M/s RKP are not sustainable. Appeal allowed - decided in favor of appellant.
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2018 (6) TMI 319
Rectification of mistake - Rectification/ clarification of Final Order no. 70448/2018 dated 05 March, 2018 - Compounded Levy Scheme - Declaration as per N/N. 30/2008-CE(NT) read with N/N. 42/2008 both dated 01 July, 2008 - Held that:- The appellant is correct in objecting to the demand for the 47 machines instead of 32 machines for the moth of July, 2008. We further find that this issue has escaped determination in the aforementioned final order of this tribunal in the appeal. Accordingly, we allow the Misc. Application and hold that that appellant shall be liable to pay duty for the month of July only 32 machines, which were found in operation, as per the declaration. Window to decided the number of machines operating - Held that:- The appellant exercised the option on 10.07.2008. On 03 July, itself they informed the Department that they wish to operate only 32 machines out of the total 47 machines, which declaration was not found to be untrue. In this view of the matter we hold that there is no application of Rule 8 of PMPM Rules and accordingly, we set aside the demand of ₹ 93,75,000/- confirmed in the impugned Order-in-Original alongwith interest thereon. The Final Order No. 70448/2018 dated 05 March, 2018 stands supplemented and or clarified by this order - ROM Application allowed.
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2018 (6) TMI 318
Clandestine removal - non-accountal of goods in the registers - 8550 linear meters of ‘gray fabric’ and 20367 linear meters of ‘semi-finished fabric’ - Confiscation orders - redemption fine - penalties - whether goods that admittedly, are not finished products were required to be recorded in the registers that are statutorily prescribed? - Held that:- There is no allegation that the goods had been clandestinely removed - The instructions of the Central Board of Excise & Customs are intended to ensure that the accounts should be of sufficient scope as to monitor, to deter and to enforce recovery in the event of any illicit clearance. While the goods and semi-finished products of the appellant may not have been so recorded, in the absence of any allegation that such non-accountal was with intent to remove goods clandestinely, there is no scope for confiscation and imposition of penalty under rule 25 of Central Excise Rules, 2002. Confiscation, redemption fine as well as penalty set aside - appeal allowed - decided in favor of appellant.
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2018 (6) TMI 317
CENVAT credit - input services - Goods Transportation Agency service utilized for outward movement of finished goods - place of removal - recovery alongwith Interest and penalty - Held that:- Place of removal is relevant solely for determination of point of levy and for computation of the duty thereon - it is quite possible that place of removal may well be the premises of the buyer and levy would include the entire costs for computation of assessable value. It is also quite apparent that this has not been considered in the proceedings before the lower authorities - matter remanded for reconsideration - appeal allowed by way of remand.
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2018 (6) TMI 316
CENVAT credit - duty paying documents - denial on the ground that credit claimed against photocopies of the bills of entry and without receipt at their premises - Held that:- There is no dispute that the goods had been utilized for the purposes of manufacture - the disallowance of CENVAT credit is not sustainable. Reliance placed in the case of Commissioner of Central Excise & Customs, Vadodara – II v. Steelco Gujarat Ltd [2010 (2) TMI 307 - GUJARAT HIGH COURT], where it was held that mere zerox copy by itself should not be made the basis of allowing the credit but where the assessee has made efforts to get the said xerox copy attested by the Range Superintendent of the supplier’s end and has established beyond doubt that the duty stands paid on the goods and the goods stand received by him - credit allowed. Appeal allowed - decided in favor of appellant.
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2018 (6) TMI 315
Refund claim - time limitation - The case of the department is that since the physical copy of the refund claim was filed on 5.1.2016 for the export made during the quarter ending December 2014, the refund claim is barred by limitation - Section 11B of the CEA 1944 - Held that:- In case of refund u/r 5 of the CCR 2004 and N/N. 27/2012-CE, the period of limitation of one year has to be reckoned from the end of the quarter to which the refund pertains. Since in Rule 5 read with notification, there is a statutory provision of filing of refund on quarterly basis. It cannot be expected that the assessee should file the refund claim within one year from the date of every export - the relevant date in case of refund u/r 5 is the date of quarter ending and refund should be filed within one year from the said date. Reliance placed in the case of CCE&ST, Bengaluru ST-I vs. Span Infotech India Pvt. Ltd. [2018 (2) TMI 946 - CESTAT BANGALORE], where it was held that In respect of export of services, the relevant date for purposes of deciding the time limit for consideration of refund claims under Rule 5 of the CCR may be taken as the end of the quarter in which the FIRC is received, in cases where the refund claims are filed on a quarterly basis. Refund allowed - appeal dismissed - decided against Revenue.
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2018 (6) TMI 309
Jurisdiction - Recall of order - whether the applicant had sufficient cause to seek restoration of appeal, which was disposed of by the bench on merits? - Held that:- In Hon'ble High Court of Rajasthan in the case of Kamdhenu Cement Ltd. [2013 (10) TMI 1296 - RAJASTHAN HIGH COURT] and the Hon'ble High Court of Punjab and Haryana in the case of Rajesh Kumar Gupta [2015 (9) TMI 626 - PUNJAB AND HARYANA HIGH COURT] wherein inherent power to recall the orders of the Tribunal has been affirmed - this Bench has power to recall the order dated 28.07.2017. Time Limitation - application for restoration of appeal has been filed beyond the period of three months - Held that:- Though the order of the Tribunal was pronounced in open court on 28.07.2017, the same was dispatched from the Registry on 02.08.2017 and the applicant being a resident of Ichalkaranji in Kolhapur District, may have received the said order after 5 days; on this presumption, the application for ROA filed by the applicant on 09.11.2017 cannot be considered as time barred. The final order dated 28.07.2017 of the Tribunal is recalled and the appeal is restored to its original number with direction to the Registry to list the appeal for final disposal in due course - application allowed.
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2018 (6) TMI 314
Valuation - Job-work - clubbing of clearances - N/N. 214/86–CE dated 25/03/1986 - It appeared to Revenue that the appellant M/s Universal Engineers & Traders is liable to pay Central Excise duty on the turnover and/or clearances of M/s Kailash Industries and further in absence of declaration as required under Notification No. 214/86–CE dated 25/03/1986, the appellant is not entitled to benefit of goods removed under job work without payment of duty and further there is no undertaking given by M/s Kailash Industries to the Jurisdictional Central Excise Officer of M/s Universal Engineers & Traders - denial also on the ground that M/s Universal Engineers & Traders have not declared any receipt of job charges in their books of accounts - benefit of N/N. 83/94–CE. Held that:- The appellant and M/s Kailash Industries had led sufficient evidence to the effect that the clubbing provisions are not applicable, as M/s Kailash Industries have got their own independent existence and have been engaged in manufacturing and clearing of goods even prior to establishment of M/s Universal Engineers & Traders - It is evident from the facts that M/s Kailash Industries was set up in 1993–94 whereas the appellant M/s Universal Engineers & Traders had been set up during the period 2001–04, when they started manufacturing and were registered with the Central Excise Department. Further, I find that the clubbing of turnover of M/s Kailash Industries was also bad as M/s Kailash Industries was not to put to notice as to why their turnover should not be added to the turnover of the appellant – M/s Universal Engineers & Traders. Benefit under N/N. 83/94–CE - denial on the ground that the declaration was not filed - Held that:- The appellant unit is also entitled to the benefit of exemption Notification No. 83/94–CE, as amended as they have fabricated the panel boxes on job work basis for M/s Kailash Industries and the said items is specified for SSI industry. Only for reason they have not filed declaration by Kailash Industries, their exemption cannot be denied. Penalty under Rule 26 on M/s Kailash Industries - Held that:- The order of penalty is ab-initio void, as Shri K. C. Gupta-Proprietor had died before passing of the Adjudication Order. Appeal allowed - decided in favor of appellant.
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2018 (6) TMI 313
Manufacture - applicability of Chapter Note-6 of Section XVI - appellant after procurement of Online UPSS, used to test Online UPSS and supplied the same to the customers to whom batteries were separately supplied and assembled to Online UPSS at the premises of Customers - The activity appeared to Revenue to have been covered by Section Note-6 of Section XVI of Central Excise Tariff Act, 1985. Held that:- The investigation at the end of M/s RPS Industries, New Delhi, M/s Integrated Power Control, New Delhi & M/s Emerson Network Power (India) Pvt. Ltd., Thane did not prove that goods in question, that is Online UPSS supplied by the appellant were incomplete or unfinished. In fact, they were complete & finished goods on which duty was paid - Revenue has not brought on record any evidence to establish that at the end of said manufacturers of Online UPS the assessment was done by resorting to general Rule of interpretation of tariff particularly Rule 2(a) which has provided that the reference to article incomplete or unfinished should be treated as reference to finished and complete article if the article is having essential character of complete or finished article.Revenue has not brought on record any evidence to establish that at the end of said manufacturers of Online UPS the assessment was done by resorting to general Rule of interpretation of tariff particularly Rule 2(a) which has provided that the reference to article incomplete or unfinished should be treated as reference to finished and complete article if the article is having essential character of complete or finished article. Since the goods were complete when they were received by M/s NPS Powers Industries, the question of application on Chapter Note-6 of Section XVI does not arise - appeal allowed - decided in favor of appellant.
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2018 (6) TMI 312
Time limitation - suppression of facts - no malafide intent - CENVAT credit - outward transportation availed in the month of March, 2008 - Scope of SCN - Held that:- Section 11AC can only be invoked when there is suppression of facts, willful mis-statement, fraud, collusion etc. with intent to evade payment of duty. Since, no such charge was made in the show-cause notice, the adjudicating authority has no power to invoke Section 11AC, which is beyond the scope of show-cause notice - there is no suppression of facts or willful mis-statement on part of the appellant as regards the availment of CENVAT Credit on outward transportation. As regards the admissibility of the outward transportation, there were plethora of litigation and there were conflicting judgments - the issue involved grave interpretation of law. For this reason also, no malafide can be attributed to the appellant. The demand is not sustainable on time bar - appeal allowed - decided in favor of appellant.
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2018 (6) TMI 311
Penalty u/s 11AC read with Rule 15(2) of the CCR 2004 - no appeal preferred against the said order - Held that:- The adjudicating authority by the order-in-original has only imposed penalties under Section 11AC read with Rule 15(2) of the CENVAT Credit Rules, 2004. It seems that against the said order no appeal has been preferred by the Revenue before the first appellate authority - In the absence of any appeal from the Revenue, the impugned order imposing penalty under Rule 15(1) of the CENVAT Credit Rules, 2004 seems to be incorrect, more so, when there is no show cause notice issued by the first appellate authority to the appellant for imposition of such penalty under Rule 15(1) of CCR 2004 - appeal allowed - decided in favor of appellant.
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2018 (6) TMI 310
CENVAT credit - demand of an amount equivalent to 6% of the value of exempted goods/non-excisable goods - common input services used in manufacture of taxable as well as exempt goods - non-maintenance of separate records - Held that:- The explanation inserted by N/N. 06/2015-CE (NT) dated 01/03/2015 to Rule 6 of CCR 2004 does not indicate whether it is retrospective amendment and the period involved in the case in hand is March 2008 to October, 2012 - the first appellate authority should have considered the various factual contentions made by appellant before him in the appeal and should not have disposed of the appeal based upon only on the insertion of the explanation which is not covering the period in question in this appeal - matter back to the first appellate authority to reconsider the issue afresh after following the principles of natural justice - appeal allowed by way of remand.
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2018 (6) TMI 308
Clandestine removal - Pukar gutkha - during the period involved in the present show cause notice DTC paid central excise duty of ₹ 5,24,99513/- and demand of central excise duty in the present proceedings is ₹ 4,90,19731/- case of appellant is that both the goods are same - scope of SCN - Held that:- Once the goods are cleared on payment of duty at the factory gate they have no control over the goods and purchaser of goods is free to deal with them in any manner he likes. Throughout the entire proceedings of the present case revenue has nowhere established that the goods on which duty of ₹ 5,24,99513/- was paid on Pukar brand gutkha for the period from May 2006 to December 2006 were different than the goods on which duty of ₹ 4,90,19731/- was confirmed in the present proceedings - In the absence of any such investigation it cannot be conclusively proved that the goods on which central excise duty of ₹ 4,90,19,731 was demanded were not the goods on which duty of ₹ 5,24,99513/- was paid during the period from May 2006 to December 2007. Appeal allowed - decided in favor of appellant.
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2018 (6) TMI 307
Refund of duty paid under protest - rejection on the ground of time limitation and unjust enrichment - Section 11B of Central Cxcise act, 1944 - Held that:- During the relevant time if the duty was paid under protest limitation was not applicable as per first proviso to sub-section 1 to section 11B of Central Excise Act, 1944 - the duty was borne by the appellant whereas there was no mention of duty in the invoices and this is how the duty was not recovered from the customers. Therefore since the duty was paid under protest and law provided that during the relevant time if duty was paid under protest, limitation did not apply therefore we hold that the present application for refund is not hit by limitation. Unjust enrichment - Held that:- there was no mention of duty in the invoices and this is how the duty was not recovered from the customers. - The appellant has proved that the duty burden was not passed on to the customers - principles of unjust enrichment do not apply. Appeal allowed - decided in favor of appellant.
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2018 (6) TMI 306
Abatement - Valuation - manufacture of Pan Masala - Rule 10 of Pan Masala Packing Machines (Capacity Determination and Collection of Duty) Rules, 2008 - sealing of machinery - rejection of abatement on the ground that intimation not made within 3 working days - matter pending before Tribunal - Held that:- The issue whether M/s Raj Products was eligible for abatement of ₹ 66,50,000/- for the period from 11.06.2012 to 25.06.2012, was pending before this Tribunal. Therefore, having filed appeal before this Tribunal regarding the said abatement Commissioner of Central Excise, Kanpur did not have jurisdiction to issue any show cause notice and adjudicate the matter which involved the said issue - The Officer of the Rank of Commissioner is not expected to conduct in such improper manner. Appeal dismissed - decided against Revenue.
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2018 (6) TMI 305
CENVAT Credit for an amount of ₹ 1,04,428/- which was reversed by them and intimated to the departmental authorities - demand of interest - Held that:- It is undisputed by the assessee before the lower authorities that they had availed CENVAT Credit on these two amounts which were not due to them and nothing was brought on record to show that they had not utilized the said CENVAT Credit during the period in question - demand of Interest seems to be correct and is upheld. Demand of ₹ 33,46,191/- in respect of interest, for availing CENVAT Credit which was reversed by the assessee-appellant in December 2008 and by a letter dated 28.01.2009 was intimated to the authorities - Held that:- If assessee-appellant have contested the reversal of ₹ 33,46,191/- on limitation, they would have succeeded. The argument on limitation for seeking setting aside the interest and penalty is an accepted proposition - the interest demanded and confirmed by the lower authorities on an amount of ₹ 33,46,191/- is incorrect and not sustainable. CENVAT Credit on overhead cranes of ₹ 3,04,642/- during the period May 2007 to December 2008 - demand of Interest and penalty as well - Held that:- The inputs like M.S.Angles, channels, bars, concrete mixer etc. are eligible inputs for availment of CENVAT Credit - demand set aside - Interest liability and penalty also set aside. Reversal of CENVAT Credit on GTA services - Held that:- The issue needs reconsideration by the adjudicating authority as it is the claim of the appellant-assessee before Tribunal as was also before the lower authorities that the said services were utilized for “inward presentation of raw materials”. Both the lower authorities have not considered this submission and confirmed the demands without any reasoning on the plea raised by appellant-assessee - matter remanded. Appeal disposed off.
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CST, VAT & Sales Tax
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2018 (6) TMI 304
Levy of sales tax - Inter-state transaction - Whether the Tribunal below ought to have considered the strong prima facie case in favour of the Revisionist in view of the inter-State nature of the transaction, Section 3 of the Central Sales Tax Act and the Specific bar contained in Section 7 of the U.P. VAT Act, the Constitution Bench Decision of the Supreme Court in Kone Elevator India Pvt. Ltd. v. State of Tamil Nadu and Ors. [2014 (5) TMI 265 - SUPREME COURT], because of which no tax can be imposed on the transaction of the U.P. authorities? Held that:- In the case at hand the Court finds that while passing the impugned order the Tribunal has failed to consider various parameters as required. Furthermore the Court finds that it has taken note of the assertion by the revisionist herein before the Tribunal that the similar issue has been decided by that very Tribunal in its favour vide judgment dated 31.3.2008 for the assessment year 2002-03, however, merely on account of pendency of a revision against it before this Court at the behest of the State the said aspect has been ignored and a contrary view has been taken giving protection only to the extent of 85% of the due amount. This in the view of this Court is not correct approach, consistency in such matters especially when the Bench in respect of the same assessee granted the relief in respect of an earlier assessment year on merits should have been maintained, if not, cogent reasons should have been given which do not exist in this case - revision allowed.
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Indian Laws
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2018 (6) TMI 346
Drugs Trafficking - possession of contraband - Bail Application - Sections 21 and 22 of NDPS Act and Sections 307, 34, 427 of IPC - whether the recovery of contraband effected from the petitioner amounts to commercial quantity or otherwise? - Held that:- Drug peddlers for a small monetary consideration make the youth to use drugs for a small time excitement/kick. The drug peddlers have successfully destroyed the social fabric of our society and led youth to the wrongful path. Such type of persons need to be dealt with firmly and sternly and no sympathy can be shown to them lest that should prove to be counter productive and result in increase drug trafficking. In addition to indulging in drug peddling, the petitioner had tried to run over the police officials performing their duties, who could save their lives with great difficulty. It has to be noticed that as per the prosecution story not only the accused was found in possession of the contraband but girl sitting with him was also in possession of the contraband. There is reasonable apprehension of his absconding and trying to tamper with prosecution evidence, if granted bail. Bail not granted - Petition dismissed.
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