TMI Tax Updates - e-Newsletter dated: August 13, 2018 - with Direct Tax, Indirect Tax and GST Updates and Updates on FTP, FEMA, IBC & Corporate Laws etc. published on TMI with Latest Case Laws

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TMI Tax Updates - e-Newsletter August 13, 2018 Case Laws in this Newsletter: GST Income Tax Customs Corporate Laws Insolvency & Bankruptcy Service Tax Central Excise CST, VAT & Sales Tax Indian Laws Highlights / Catch Notes Income Tax Addition u/s 40(a)(ia) - Failure to deduct TDS on expenditure debited as export charges to the Profit & Loss account - AO directed to verify the nature of payment with the C&F agreement, relevant bills of authenticated transport operators and decide the issue afresh on merits. Visit to Get Source Obligation to collect Tax at Source (TCS) u/s 206C - sale made to scrap dealers - Since the factum of the purchaser have shown these purchases in their books of account and have paid due taxes while filing of return of income, has not been examined either by the Assessing Officer or by the ld. CIT(A), matter remanded back. Visit to Get Source Reassessment u/s 147 - Merely because the quantum of income which is finally determined is lower than the amount specified in the reasons, the same cannot be the basis for challenging the initiation of reassessment proceedings U/s 147 of the Act. - However, order set aside on the ground of non-supply of reason to believe so recorded to the assessee. Visit to Get Source Levy of penalty u/s 271(1)(c) - large income admitted in the returns filed u/s. 153A - Had it been there is no search, the assessee would not have disclosed the income in respect of the undisclosed income. Hence, such amounts squarely come within the purview of penalty u/s. 271(1)(c) of the Act. Visit to Get Source Disallowance of depreciation on non-compete territory rights - The department sought to disallow the deprecation to the assessee in all these years even without adjudicating the issue on merit at any stage. It is not permissible. Visit to Get Source Scrutiny/ regular assessment u/s 143(3) - validity of notice issued u/s 143(2) - Belated claim of refund with interest by making application u/s 119(1)(b)(c) - There is no ambiguity under the law that the scrutiny assessment is to be framed as per the provisions of Section 143 of the Income-tax Act, 1961. The Instruction No. 13/2006 would not override these provisions. Visit to Get Source Exemption u/s 10(23C)(vi) r.w.s. 11 - When the assessee’s activities or the purposes are considered as existing for purposes of profit, its claim u/s 11 that it is existing for “charitable purposes” within the scope of section 2(15) of the Act also fails both the ays. Visit to Get Source Customs SAD Refund - whether the appellant have committed any illegality in filing the two claims for refund of SAD under Notification No.102/07/CUS, with respect to two separate Bills of Entry, within the same calendar month? - Held No - refund allowed. Visit to Get Source Indian Laws Cheque bounce case - Prosecution proceedings u/s 138 of the Negotiable Instruments Act - Whether moratorium prohibiting institution of a proceeding as provided for in Section 14 of the Insolvency and Bankruptcy Code, 2006 (hereinafter referred to as Code) applies even to a criminal proceeding - Held no. Visit to Get Source IBC Protecting the interests of home buyers in projects floated by Jaypee Infratech Limited (JIL) - SC in exercise of powers under Article 142, applied the provisions of amendments in the IBC by the Ordinance with retrospective effect. Visit to Get Source Service Tax Works Contract Service - Construction activity - The hostel which was constructed was a girls hostel and hospital which was need of the Jaipur was constructed. - It was not commercial building as per the language used and the activities neither fall under commercial activities nor industrial activities - it is purely a social activity - demand set aside. Visit to Get Source Valuation - demand of service tax on security deposit made by tenant - he demand raised in the impugned order is erroneous being made on the refundable security deposit. Such refundable amount cannot form consideration as defined u/s 67. Visit to Get Source Refund claim of service tax on services which were exempted with retrospective effect - Illegal action of CPWD in adjusting security deposit of the petitioner - CPWD directed to release the amount. Visit to Get Source Refund of service tax paid - Scope of Rule 5B of CCR - Since the respondent discharged the service tax liability in the capacity of recipient of service, Rule 5B should be equated with Rule 5 of the rules, for grant of refund of service tax paid on the taxable services. Visit to Get Source Central Excise Classification of goods - assembly of various bought-out electrical items and accessories - The process of mounting two components/items on the wooden or plastic board would not amount to manufacture Visit to Get Source Job-work - who is liable to pay duty - although the job worker is a manufacturer by virtue of the exemption notification r/w declaration made by the raw materials supplier, the burden of discharging excise duty shifts on to the raw material supplier. Visit to Get Source VAT Time Limitation - whether this Court can entertain a Revision Petition under Section 48(1) of the Himachal Pradesh Value Added Tax Act, 2005, which is filed beyond the period of limitation so prescribed in the Statute? - Held No Visit to Get Source Articles THE CENTRAL GOODS AND SERVICES TAX (AMENDMENT) BILL, 2018 EXEMPTION TO E-WAY BILL REQUIREMENT – PART I Notifications Customs 15/2018-Customs (N.T./CAA/DRI) - dated 10-8-2018 - Cus (NT) Appointment of Common Adjudicating Authority by DGRI-reg. 14/2018-Customs (N.T./CAA/DRI) - dated 10-8-2018 - Cus (NT) Appointment of Common Adjudicating Authority by DGRI-reg. GST - States G.O.Ms.No. 392 - dated 23-7-2018 - Andhra Pradesh SGST NOTIFYING GOODS OF PERISHABLE OR HAZARDOUS NATURE UNDER SECTION 67(8) OF THE ANDHRA PRADESH GOODS AND SERVICES TAX ACT, 2018 S.O. No. 48 - dated 31-7-2018 - Jharkhand SGST Amendment in the Notification No. S.O. 130 dated the 14th November, 2017. - Appointment of appellate Authority. S.O. No. 47-29/2018-State Tax - dated 25-7-2018 - Jharkhand SGST The Jharkhand Goods and Services Tax (Seventh Amendment) Rules, 2018. S.O. No. 46-12/2018-State Tax (Rate) - dated 18-7-2018 - Jharkhand SGST Amendment in the Notification of the Government of Jharkhand, in the Department of Commercial Taxes, No.8/2017-State Tax (Rate), dated the 29th June, 2017. (22/2018) FD 48 CSL 2017 - dated 6-8-2018 - Karnataka SGST Seeks to exempt payment of tax under section 9(4) of the CGST Act, 2017 till 30.09.2019. (13/2018) FD 47 CSL 2017 - dated 6-8-2018 - Karnataka SGST Seeks to lay down the special procedure for completing migration of taxpayers who received provisional IDs but could not complete the migration process. 01-I/2018 - dated 30-7-2018 - Karnataka SGST Notification issued to extend the due date for filing of FORM GSTR-6. F.A-3-42-2017-1-V-(68) - dated 27-7-2018 - Madhya Pradesh SGST Amendments in the Notification No. FA-3-32/2017/1/V/(41) dated 29th June, 2017. F.A-3-36-2017-1-V-(66) - dated 27-7-2018 - Madhya Pradesh SGST Amendments in the Notification No. FA-3-36-2017-1-V (66), dated 30th June, 2017. F.A-3-28-2017-1-V-(67) - dated 27-7-2018 - Madhya Pradesh SGST Amendments in the Notification No. FA-3-28-2017-1-V(48), dated 30th June 2017. F.A-3-23-2018-1-V-(69) - dated 27-7-2018 - Madhya Pradesh SGST Exempts the intra-state supplies of handicraft goods. ERTS (T) 65/2017/434 - dated 26-7-2018 - Meghalaya SGST Seeks to insert explanation in an item in notification No.ERTS(T)No. 65/2017/11, dated 29th June, 2017 ERTS (T) 65/2017/433 - dated 26-7-2018 - Meghalaya SGST Amendment in Notification No. ERTS (T) 65/2017/14, dated 29th June, 2017 ERTS (T) 65/2017/432 - dated 26-7-2018 - Meghalaya SGST Amendment in Notification No. ERTS(T)65/2017/13, dated 29th June, 2017 ERTS (T) 65/2017/431 - dated 26-7-2018 - Meghalaya SGST Amendment in Notification No. ERTS (T)65/2017/12, dated 29th June, 2017 ERTS (T) 65/2017/430 - dated 26-7-2018 - Meghalaya SGST Amendment in Notification No. ERTS(T)65/2017/11,dated the 29th June, 2017 Circulars / Instructions / Orders GST - 55/29/2018 - dated 10-8-2018 Taxability of services provided by Industrial Training Institutes (ITI) - reg. Customs - 26/2018 - dated 10-8-2018 Simplification and rationalization of processing of AEO-T1 application - reg. News Filings of GST Returns Anti-Profiteering Mechanism under GST GST Compensation to States Impact and Awareness of GST Total number of subscribers under APY is 1,09,66,981 as on 06.08.2018 out of which 43,87,993 subscribers are women Consultative Paper on proposed SEBI (Fiduciaries in the Securities Market) (Amendment) Regulations uploaded on the SEBI website for seeking public comments India’s GDP expected to grow significantly Instruction for Safety of Lockers in Banks Settlement of Insurance Claims New Pension Scheme (NPS) Guidelines to Control Black Money in Share Market To enhance their skills and keep pace with the changes in the World Global Environment, the Department of Expenditure takes the lead role in the capacity building of Financial Advisers Case Laws: GST 2018 (8) TMI 660 Jurisdiction to issue SCN - contention of petitioner is that in absence of any Notification under Section 4 of IGST Act, the respondent Nos. 2 to 4 are not competent to issue SCN - Held that:- Revenue prays for and is granted three days time to take instructions in the matter and to point out to this Court whether any notification has been issued or not? - List the matter in the next week. Income Tax 2018 (8) TMI 659 Genuineness of claim of expenditure - whether PCL has given the Bank Guarantee and not - Held that:- it is noticed that M/s. PCL Intrtech Lenhydro Consortium JV was awarded the contract and constituent members agreed to demarcate and share, for operational convenience, their responsibilities in respect of execution of the work. It is also noticed that RSJV has taken on sub-contract the work of PCL. As per the said agreement, the margin money and bank guarantee commission is payable by the JV Since PCL-Intertech Consortium was the main contractor, the bank guarantee would have to be provided in its name. Since the assessee has not reflected the Bank Guarantee in its books, it has to be presumed that Bank Guarantee has been given by M/s. PCL and that the assessee is liable to pay the guarantee commission for availing the said service. In these circumstances, the Bank Guarantee commission is allowable as business expenditure. 2018 (8) TMI 658 Transfer pricing - arms length price (ALP) - selection of comparable - international transactions with its AE - adoption of TNMM as the most appropriate method - The assessee raised its objections to all the comparables proposed by the TPO. However, the TPO rejected the assessee’s objections -Held that:- assessee’s appeal is partly allowed for statistical purposes. 2018 (8) TMI 657 Reopening of assessment u/s 147 r.w.s 148 - reason to believe - Capital gains - Sale of land - Agriculture land or not - capital assets - land was purchased and sold within a short period of 10 months time - Held that:- Merely because addition has been made in hands of co-owner, no presumption could be drawn that income has escaped assessment in the hands of assessee, without there being independent ‘reasons to believe’ , based upon cogent materials. Secondly, Inspector’s report based upon which assessment was completed in the hands of Smt.Chaya Sinha, specifically states that alleged agricultural land is situated 11 km away from Thasil Palwal, and therefore 2nd reason for reopening of assessment is again based upon a contrary view. Intention to use a particular piece of land for non agricultural purposes cannot by itself alter character of the land in question. Authorities below has not been able to dispute that during financial year relevant to assessment year under consideration, as per revenue records land in question has been shown as “KHUD KHAST” and without any basis or material evidence rejects these Government records by holding it to be an mechanical entry. No additions - reassessment is not valid - Decided in favor of assessee. 2018 (8) TMI 656 Transfer pricing - Assessment u/s 144C r.w.s 143(3) - returned income of Rs. Nil after setting off of brought forward losses - adjustments twoards alleged difference in the arm’s length price of the international transaction of provision of software development services - disregard to the internal benchmarking undertaken by the appellant. Held that:- There is no dispute that the facts and circumstances in the present assessment year are similar to the facts and circumstances as obtaining in the preceding assessment years. The revenue has not placed before us any material so as to enable us to take a different view in the matter. In view of these facts and circumstances, respectfully following the order for earlier assessment years noted above, we restore this matter to the file of the AO/TPO with similar directions as have been given by the ITAT in the preceding assessment year Appeals of the assessee are allowed for statistical purposes. 2018 (8) TMI 655 Levy of penalty u/s. 271(1)(c) - defective notice u/s 274 - Held that:- We find the notice dt. 29-12-2009 issued u/s. 274 r.w.s 271 of the Act, placed at page no. 1 of paper book, does not specify the charge of offence committed by the assessee viz whether had concealed the particulars of income or had furnished inaccurate particulars of income. Hence the said notice is to be held as defective. No penalty - decided in favor of assessee. 2018 (8) TMI 654 Additions on account of TSS Grant - capital receipt and not in the nature of income - Held that:- if the receipt in question is held as income, then the corresponding money spent by the Assessee from TSS have to be regarded as expense (though they might have been laid out for meeting capital expenditure) and only the net receipt can be brought to tax. - Since all these aspects have not been examined by the revenue authorities, matter remanded back. 2018 (8) TMI 653 Addition u/s 40(a)(ia) - Failure to deduct TDS on expenditure debited as export charges to the Profit & Loss account - assessee contended that, clearing and forwarding charges consisting of payments towards customs duties, transport charges, postage expenses, commission to the C&F agent and the service tax. - Held that:- the Ld.CIT(A) held that the payment was towards reimbursement of expenses but no finding was given by the AO in this regard and the Ld.CIT(A) did not afford any opportunity to the AO to verify the nature of expenses with the agreement and supporting bills of transportation or the tickets of Railway, Road Carriers etc., Hence in all fairness we consider it is just and fair to remit the matter back to the file of the AO to verify the nature of payment with the C&F agreement, relevant bills of authenticated transport operators and decide the issue afresh on merits after giving opportunity to the assessee. TDS on payment made to Shipping Agents - Held that:- In case, the expenses were incurred for ocean freight, the assessee is entitled for deduction and no TDS is required to be made on the ocean freight since the ocean freight and the reimbursement of actual expenses does not include the profit element. - In addition the expenses claimed over and above the ocean freight must be established by the assessee that the same represent the reimbursement of expenses with relevant evidences. Therefore, in all fairness, we are of the view that the issue should be remitted back to the file of the AO to make detailed verification of the nature of expenses with relevant bills and supporting evidences and to decide the deductibility of TDS and consequent disallowance u/s 40(a)(ia). Accordingly, we direct the AO to examine the issues and redo the same after giving opportunity to the assessee. In the result appeal of the revenue is allowed for statistical purpose. Decided in favor of revenue for for statistical purpose. 2018 (8) TMI 652 Reassessment u/s 147 - disallowance of expenses u/s 37(1) - bogus expenditure - recording of reasons for satisfaction - Revenue submitted that, as per report of Investigating wing, assessee is one of the beneficiary of accommodation entry from concerns of S.K. Gupta group - Held that:- We have also perused reasons recorded for reopening the assessments, wherein there is specific information regarding assessee before us, of having accepted accommodation entry bills, which could not have been verified without calling for necessary details. Further in order to verify the information received by Ld.AO issued notice under section 147 which was necessary to ascertain, if there has been any escapement of income. - Reopening of assessment confirmed - Decided against the assessee. Enhancement of income by the CIT(A) in appellate proceedings - CIT (A) has in a way enhanced addition by charging 2% commission for providing accommodation entries to assessee. - Held that:- It is observed that assessee was not given any notice of enhancement by Ld.CIT (A), thereby not following due process of law, as per section 251 of the Act. We are therefore inclined to delete addition made by Ld.CIT (A) to of 2% as commission for providing accommodation entry to assessee. Decided in favor of assessee partly. 2018 (8) TMI 651 Obligation to collect Tax at Source (TCS) u/s 206C - sale made to scrap dealers - assessee raised this issue that the purchaser have considered these amounts in their books of account and also paid due taxes - Held that:- the issue regarding applicability of proviso to Section 206C(6A) as well as the proviso to Section 201(1) of the Act which were brought into statute by amendment brought vide Finance Bill 2012 is settled by the various courts including the Hon'ble Supreme Court as well as the various Benches of the Tribunal that the said proviso is retrospective in nature. Since the factum of the purchaser have shown these purchases in their books of account and have paid due taxes while filing of return of income, has not been examined either by the Assessing Officer or by the ld. CIT(A). Matter remanded back. - Decided in favor of assessee for statistical purposes. 2018 (8) TMI 650 Reassessment u/s 147 - recording of reason to believe u/s 148 - sale of property - Held that:- In our view, the Assessing Officer is duly ceased of the information in the form of the sale deed registered with the Sub-registrar, Dholpur, Rajasthan and the assessee’s share in the sale deed is also determined to the extent of 1/5 share. There is, therefore, a definitive and a live link between the information in possession of the Assessing Officer and formation of believe that the income in the form of capital gain on the sale of the property has escaped assessment. Merely because the quantum of income which is finally determined is lower than the amount specified in the reasons, the same cannot be the basis for challenging the initiation of reassessment proceedings U/s 147 of the Act. Mechanical approval by Additional CIT - Held that:- The said approval cannot be said to have been granted mechanically, rather in our view, the ld. Additional CIT has applied his mind before granting the approval to the Assessing Officer to initiate the proceedings U/s 147 of the Act. The decisions relied by the ld. AR are distinguishable on facts and does not support the case of the assessee. Even though the proceedings have been validly initiated by issuance of notice U/s 148 of the Act, however, giving the fact that the reasons so recorded have not been supplied to the assessee even though the same were being specifically asked during course of reassessment proceeding, a fact which remain undisputed before us, the reassessment proceedings have become vitiated and liable to be set aside respectfully following the decisions of the Hon’ble Supreme Court and other High Courts referred supra. Decided in favor of assessee. 2018 (8) TMI 649 Rectification of order - recalling of earlier order - Additions u/s 56(2)(viib) - valuation of fair market value of the shares - Held that:- there is an error apparent on record for not adjudicating the issue of valuation in terms of Clause(ii) of Explanation (a) to Section 56(2)(viib) of the Act. Accordingly, we recall the impugned order for the limited purpose of considering and adjudication of issue of valuation in terms of Clause (ii) of Explanation (a) to Section 56(2)(viib) of the Act. The appeal of the assessee is directed to be listed for hearing and adjudication of the particular issue on 10/09/2018. The parties be informed. Misc. application of the assessee is allowed. 2018 (8) TMI 648 Levy of penalty u/s 271(1)(c) - assessee did not file returns of income prior to search and the large income admitted in the returns filed u/s. 153A - CIT(A) deleted the penalty - Held that:- the income offered by the assessee in the income filed pursuant to issue of notice under section 153A of the Act, is the income detected during the course of search and seizure operation. The case of the assessee is squarely covered by the provisions of Explanation 5A to section 271(l)(c) of the Act and the assessee is exigible to levy of penalty on such income which was detected during the course of search and seizure operation, which in turn has been offered by the assessee in return of income filed pursuant to notice issued under section 153A of the Act. In the returns filed subsequent to the search, the assessee disclosed income to cover the source of various unaccounted money and other assets unearthed by search action. The amounts shown by the assessee were not part of his regular income and it is undisclosed income of the assessee. Had it been there is no search, the assessee would not have disclosed the income in respect of the undisclosed income. Hence, such amounts squarely come within the purview of penalty u/s. 271(1)(c) of the Act. Levy of penalty confirmed - Decided against the assessee. 2018 (8) TMI 647 Disallowance of depreciation on non-compete territory rights - Held that:- The AO either should have dealt with the issue elaborately in the original assessment order, or should have followed the outcome of the assessment year 2002-03. The ld.CIT(A) in the first round in all these years has allowed the ground of appeal. It means, depreciation ought to be granted to the assessee. The department sought to disallow the deprecation to the assessee in all these years even without adjudicating the issue on merit at any stage. It is not permissible. - Decided against the revenue. 2018 (8) TMI 646 Disallowance u/s 14A - tax payable u/s 115JB was greater than the tax payable under the normal provisions - Held that:- following the decision of HC, we set aside the order of the Ld. CIT(A) and direct the AO to restrict the disallowance out of common administrative expenses to 2% of the total exempt income. 2018 (8) TMI 645 Long Term Capital Gains (LTCG) - Benefit of Indexation u/s 48 - indexed cost of acquisition with reference to the year in which the previous owner first held the asset - income earned on sale of share in land - transfer of a capital asset acquired by assessee under a gift or will - Held that:- Since the assessee in the present case is held liable for long term capital gains tax by treating the period for which the capital asset in question was held by the previous owner as the period for which the said asset was held by the assessee, the indexed cost of acquisition has also to be determined on the very same basis. - Decided against the revenue. 2018 (8) TMI 644 Scrutiny/ regular assessment u/s 143(3) - validity of notice issued u/s 143(2) - Belated claim of refund with interest by making application u/s 119(1)(b)(c) - Estimation of income by applying GP rate - The assessee filed an application u/s 199(2)(b) of the Income-tax Act, 1961. The said application came to be decided on 17.01.2008. While disposing of that application, the Ld. CIT(A) directed the AO to determine the refund after scrutinizing the case by issue of notice u/s 143 of the Act, as per para 7 of Instruction No.13 dated 22.12.2006 issued by the Board. In pursuance of that order, a notice u/s 143(2) was issued to the assessee on 16.05.2008. The contention of the assessee is that the AO could not have issued the notice u/s 143(2) of the Act. Held that:- There is no ambiguity under the law that the scrutiny assessment is to be framed as per the provisions of Section 143 of the Income-tax Act, 1961. The Instruction No. 13/2006 would not override these provisions. AO has misconstrued direction of the ld. Commissioner of Income-tax and assessed the income by making scrutiny assessment. It is also noticed that there is an inordinate delay in disposing the application by the ld. Commissioner of Income-tax. Under these facts, we are constrained to hold that the impugned assessment order as framed by the AO is contrary to the provisions of law and beyond the jurisdiction of the AO. AO directed to allow refund with interest - Decided in favor of assessee. 2018 (8) TMI 643 Exemption u/s 10(23C)(vi) r.w.s. 11 - application of income - refused to allow the assessee’s depreciation claim on the capital expenditure - invoking the provisions of sections 13(1)(c) & 13(1)(d) - honorarium payments made to specified person - Held that:- when the assessee makes huge profits year after year, the findings recorded by the lower authorities that the assessee is running a profitable venture, during the impugned years, is justified and hence the corresponding grounds of the assessee are dismissed for both the years. Further, there is a clear violation u/s. 11(1)(c)/11(1)(d) rw.s.11(5). Therefore, the provisions of Section 11 become in-operative and the surplus gained by the Trust for the year therefore needed to be brought to taxation and accordingly assessed the assessee’s income. When the assessee’s activities or the purposes are considered as existing for purposes of profit, its claim u/s 11 that it is existing for “charitable purposes” within the scope of section 2(15) of the Act also fails both the ays. Thus, when the assessee is not entitled for the benefit u/s 11, all its other claims u/s 11 are not allowable and hence they become academic and hence not dealt with . 2018 (8) TMI 642 Deduction u/s 54F and 54B - investment of income from capital gain - the conveyance deed was executed on 03-07-2012. The assessee contended that he has entered into sale agreement with the buyer on 13-08- 2010 and the new house was purchased on 22/04/2010 which was within one year of the transfer of the land. Held that:- It is crystal clear that the decision in the case of Sanjeev lal [2014 (7) TMI 99 - SUPREME COURT] was delivered after taking into account the peculiar facts of the case that the sale deed could not be executed because of the pending litigation and the competent court has prohibited the assessee to execute the sale deed therefore it is held that the assessee was entitled for relief under section 54 of the act. However, in the case of the assessee, we did not find any such peculiar circumstances which have prohibited the assessee to execute the sale deed. We have also considered all the judicial pronouncements referred by the assessee and we find facts of the case of the assessee are distinguishable, therefore, the same are not applicable to the case of the assessee. Further when the assessee has executed agreement to sale on 13.08.2010 the land was agricultural land and agreement to sale was made with non-agricultural person. The land was transferred only on 03-07-2012 when a registered sale deed was executed and it was absolutely correct that there was no creation of any right of the purchaser in the said land as the same were prohibited by the law relating to transfer of agricultural land as existing in the state of Gujarat. Claim of deduction u/s 54F as well as 54B disallowed - Decided against the assessee. Customs 2018 (8) TMI 640 Suspension of CHA License - procedure of suspension of license - Regulation 19 of CBLR - Held that:- When the statute or law prescribes for a remedy of appeal, it is conceded that it is alternate and equally efficacious. The misconception that an appeal can be filed only if there is an order passed and duly served on the parties like the petitioners need not detain us. It is a misconception, for even inaction or noncompliance with the rules or not passing a specific order of suspension but putting up a one line communication or note of suspension on the website can also be highlighted. The petitioners can highlight the inaction of the authorities in not dealing with the representation of the petitioners promptly. The Tribunal has been consistently entertaining appeals and even against the orders of suspension. Petition dismissed for want of alternate and equally efficacious remedy. 2018 (8) TMI 639 Extended period of limitation - Section 28(2B) of Customs Act - intent to evade - Held that:- If the re-calibrated measurements are considered the appellant had, in fact, lost money by paying excess duty overall and has not gained anything by not re-calibrating their tanks. Therefore, it cannot be alleged that the appellant had any motive to evade payment of duty because he actually paid excess duty on the whole. The extended period of limitation cannot be invoked with respect to those demands and since the show cause notice has been issued after the period, the entire demand is unsustainable. Appeal allowed - decided in favor of appellant. 2018 (8) TMI 638 Rectification of Mistake - Held that:- From the record, the Tribunal has arrived at the conclusion that it is Rajendra Prasad alias Raju, the G-card holder only who had collected documents from one Randheer Singh and infact had admitted in his statement about carrying out the forgery of the import invoices using his computer and using such forged invoices, mis-declared the imported goods in the bills of entry. Statement of Shri Rajendra, alias Raju, the G-card holder has been considered by the Tribunal. The perusal of above decisions makes it abundantly clear that there is no alleged error apparent on record on account of which the Order can be rectified/reviewed.From the record, the Tribunal has arrived at the conclusion that it is Rajendra Prasad alias Raju, the G-card holder only who had collected documents from one Randheer Singh and infact had admitted in his statement about carrying out the forgery of the import invoices using his computer and using such forged invoices, mis-declared the imported goods in the bills of entry. Statement of Shri Rajendra, alias Raju, the G-card holder has been considered by the Tribunal. The perusal of above decisions makes it abundantly clear that there is no alleged error apparent on record on account of which the Order can be rectified/reviewed. Under the Customs Act, irrespective there is an expressed provision as already mentioned above for rectification/ review but the error alleged is about seeking review/ rectification on merits and as discussed above that the Tribunal vide the impugned order has considered' the argument of mixed identity hence there cannot be held any alleged apparent error on record. Application has nor merits and is liable to be dismissed. 2018 (8) TMI 637 Refund of SAD - N/N. 102/2007-Cus - rejection of refund on the ground that the importer has not given any indication or declaration in the sale invoices submitted by him along with the refund applications, either in CD form or in paper form - Held that:- It is an admitted fact that in invoice of resale of the imported goods, the appellant have not shown SAD paid, on such invoices, nor any details of bill of entry under which the goods were imported - there cannot be deemed passing of the duty, particularly SAD. Reliance placed in the case of Chowgule & Company Pvt.Ltd. [2014 (8) TMI 214 - CESTAT MUMBAI (LB)]. Refund allowed. 2018 (8) TMI 636 SAD Refund - whether the appellant have committed any illegality in filing the two claims for refund of SAD under Notification No.102/07/CUS, with respect to two separate Bills of Entry, within the same calendar month? - Held that:- The restriction is with respect to a particular Bill of Entry, and there is no restriction for the assessee to file separate refund claims in a particular month with respect to different Bills of Entry - the refund claim has to be processed with respect to a particular Bill of Entry, and the goods sold by their subsequent sale and sales tax having been paid. Therefore, there is no illegality and or violation or procedural infirmity in making two refund claims in respect of two different Bills of Entry. Refund granted - appeal allowed - decided in favor of appellant. 2018 (8) TMI 635 Rectification of Mistake - Hon'ble High Court has subsequently reviewed its decision and upheld the order of Tribunal - Held that:- It is apparent that in a case where Hon'ble Apex Court decision is pronounced, subsequent to the decision of lower court, only in those circumstances, the Rectification of Mistake application can be entertained. The principle being that decision of Hon'ble Apex Court is defacto law of the land - In the instance case there is no decision of Hon'ble Apex Court. It is the decision of Hon'ble High Court of Delhi. ROM application dismissed. 2018 (8) TMI 634 SAD Refund - whether the appellant is entitled for refund of SAD paid by availing exemption notification 102/2007-CUS dated 14.09.2009 in the case where the SAD was debited in the DPEB pass book not paid in cash? Held that:- The appellant is entitled for a cash refund under N/N. 102/2007- Cus even though the said amount was paid by the debiting DEPB scrip - Hon’ble Delhi High Court dealt with the very identical issue in the case of Allen Diesels India Pvt. Ltd. [2016 (2) TMI 247 - DELHI HIGH COURT] which held that under N/N. 102/2007- Cus. even if the special edition duty was debited in the DEPB scrip, the refund should be granted in cash. Appeal allowed - decided in favor of appellant. Corporate Laws 2018 (8) TMI 641 Violation of provision of SEBI - listed company has violated Clause 36 of the Listing Agreement by failing to disclose that it has acquired indirect control over another listed company through a Trust established exclusively for its benefit - whether SEBI is justified in disposing of that complaint by merely recording that the Trust is not a subsidiary of the listed company and hence no disclosures were required to be made under Clause 36 of the Listing Agreement, is the basic question raised in this appeal. Held that:- Admittedly, on reconsideration of the issue SEBI has not passed any quasi judicial order but only submitted a report to this Tribunal in the form of an affidavit. In these circumstances, while setting aside the impugned decision dated 9/1/2017, we direct SEBI to decide afresh the question as to whether on execution of ZOCD Agreement dated 27/2/2012 RIL acquired indirect control over NW18 through IMT and failed to disclose the same in violation of Clause 36 of the Listing Agreement. We make it clear that our prima facie view that by subscribing to the ZOCDs under the ZOCD Agreement dated 27/2/2012 RIL acquired indirect control over NW18 through IMT is not binding on SEBI and SEBI is directed to reconsider the issue independently without being influenced by the prima facie observations made by this Tribunal in that behalf. Insolvency & Bankruptcy 2018 (8) TMI 661 Protecting the interests of home buyers in projects floated by Jaypee Infratech Limited (JIL) - IDBI Bank Limited instituted a petition under Section 7 of the Insolvency and Bankruptcy Code 2016 (IBC) against JIL (CP (IB) 77/ALB/2017)) before the National Company Law Tribunal (NCLT) at its Bench at Allahabad. The bank sought the initiation of a Corporate Insolvency Resolution Process (CIRP) against JIL. Held that:- in the absence of a statutory recognition of the position of the home buyers as financial creditors, the law did not allow for real and substantive entitlements to them in the CoC. These statutory entitlements have been brought in by the Ordinance in order to recognise the vital interests of the home buyers in a real estate project and to allow them a statutory status in the insolvency resolution process. Unfortunately by the time that the Ordinance came into being on 6 June 2018, the period of 270 days had expired; the resolution plan of Lakshdeep was rejected and the IRP informed NCLT that no resolution plan had been approved within the extended period of 270 days on 12 May 2018. Having regard to the material change which has been brought about by the amendment of the IBC by the Ordinance and the fact that this Court has been in seisin of the proceedings to ensure that the home buyers are protected, we are of the view that it is but appropriate and to do complete justice to secure the interests of all concerned that the CIRP should be revived and CoC reconstituted as per the amended provisions to include the home buyers. In the facts of the present case, recourse to the power under Article 142 would be warranted to render complete justice. Parliament has undoubtedly provided a period of 180 days and an extended period of 90 days to complete the process. But in the present case a peculiar situation has arisen as a result of which the status of the home buyers which had not been recognised prior to 6 June 2018 has now been expressly recognised as a result of the amending Ordinance. A new CoC should be constituted in accordance with the amended provisions of the IBC to enforce the statutory status of the allottees as financial creditors. We also clarify that apart from the three bidders whose bids were found to be eligible by the IRP, it would be open to the IRP to invite fresh bids to facilitate a wider field of choice before the CoC. IRP permitted to invite fresh expressions of interest for the submission of resolution plans by applicants, in addition to the three short-listed bidders whose bids or, as the case may be, revised bids may also be considered. Service Tax 2018 (8) TMI 629 Works Contract Service - Construction of building or civil structure services - Commercial Building or not - Exemption to the Turnkey Projects - Whether the ld. CESTAT was right in law in extending the benefit of exemption to the Turnkey Projects which is available to the construction of building or civil structure services covered under clause (ii)(b) of Works Contract service, but is not available to Turnkey Projects covered under clause (ii)(e) of Works Contract service, as both these services are entirely different? Held that:- The hostel which was constructed was a girls hostel and hospital which was need of the Jaipur was constructed. In that view of the matter, it was not commercial building as per the language used and the activities neither fall under commercial activities nor industrial activities, it is purely a social activity where the girls hostel is constructed for girls students in city of Surat and hospital in Jaipur. These are excluded from tax liability under works contract service - appeal dismissed - decided against Revenue. 2018 (8) TMI 628 Penalty u/s 76 and 78 of FA - Doctrine of Merger - whether penalties can be imposed simultaneously under section 76 and 78? - Held that:- It is now a settled law that for the period prior to 10.05.2008 simultaneous penalties can be imposed under section 76 and 78. Quantum of penalty - whether penalty imposed under section 78 is in excess of the demand? - Held that:- Section 78, as it stood during the period, provided for a penalty equal to the amount of service tax levied or paid or short levied or short paid. There is a mandatory penalty and this cannot be either increased or reduced - the penalty imposed is in excess of demand, which needs to be reduced. Appeal allowed in part. 2018 (8) TMI 627 Whether differential service tax liability needs to be discharged by the appellant herein for the period April, 2007 and May, 2007 without extending benefit of abatement of N/N. 01/2006 and for the subsequent period whether ash dyke constructed by the appellant would fall under the works contract services or site formation and clearance services? Held that:- The entire contract which has been entered into by the appellant with Lanco Infratech Ltd is nothing but a works contract and will remain so. If it is so, the law settled by the Apex Court in the case of Larsen and Toubro Ltd [2015 (8) TMI 749 - SUPREME COURT] in respect of such kind of works contract is that they remain works contract pre and post 01.06.2007, would cover the issue in favour of appellant and demand of differential service tax liability for the period April and May, 2007 and after June, 2007 a works contract. The adjudicating authority in the case in hand has misdirected his finding to record that construction of ash dyke cannot be considered as works contract and benefit of the Works Contract (composition scheme for payment of Service Tax) Rules, 2007 cannot be extended. The findings recorded by the adjudicating authority on the confirmation of the demand of differential duty under this category are correct and does not require any interference - The demand of ₹ 72,08,553/- along with interest is upheld. Penalty - Held that:- The issue of whether the activity would fall under the category of construction of road or otherwise is an issue of interpretation of Notification No. 17/2005-ST. - the appellant could have entertained a bona fide belief that they are eligible for the benefit of Notification No.17/2005-ST. - Penalties set aside. Appeal disposed off. 2018 (8) TMI 626 Levy of service tax - parking charges - whether the appellant is liable to pay service tax on the parking charges collected by the appellant as “Authorized Service Station” during the period 2008-09 to 2011.12? - extended period of limitation. Held that:- Demand upto 30.04.2011 confirmed in view of the amendment in the definition of 'Authorized Service Station' under Clause (zo) of sub-Section (105) of Section 65 of the Act. No case for invocation of extended period of limitation is made out - the demand for extended period - The demand of duty for the normal period after 1.5.2011 upheld - penalties set aside. Appeal allowed in part. 2018 (8) TMI 625 Admission of additional submissions/documents - Held that:- Most of the documents are copy of the documents which are already part of record below and some of these are calculations/reconciliations prepared by them - the additional submissions and documents admitted - appeal allowed. 2018 (8) TMI 624 Extended period of limitation - Classification of Services - Smt Sneh Piplani, Proprietor of M/s ACE Institute for Education & Language, Jaipur under an agreement with M/s ACE Institute for Education & Language, started coaching services - modification of exemption w.e.f. 27.02.2010 defining "Vocational Training Institute‟ - whether the said services would be classified under the head Commercial Training & Coaching Services or otherwise? - penalties. Held that:- In the facts and circumstances of the case, no case for suppression and/or malafide conduct is made out against the Appellants. Accordingly, the demand for the extended period is not sustainable and also that the Appellant is not liable to pay Service Tax for the period prior to 27.02.2010 - penalty u/s 78 also set aside. As far as penalty imposed under Section 76 is concerned, the matter remanded to the adjudicating authority to recalculate the demand for the period after 27.02.2010 and also to recalculate the penalty under Section 76 - the penalty imposed under Section 77 is reduced to ₹ 5,000/-. Appeal allowed in aprt. 2018 (8) TMI 623 Levy of Service Tax - activity of trading - whether the appellant is liable to pay service tax on their activity of trading, wherein they receive goods on sale basis from the manufacturer-Ingersoll-Rand India Ltd (IRIL) and such goods are resold by them on retail sale price as fixed by the manufacturer IRIL and they are entitled to a fixed amount of commission/discount/margin? Held that:- There is no merit in the appeal of Revenue as the appellant assessee have purchased the goods from the principal and have resold such goods on payment of sales tax/VAT. It is not the case of Revenue that such sales tax have been paid erroneously or there was no sale purchase at all. Benefit of N/N. 8/2008-ST. - Held that:- Appellant are entitled to the benefit of threshold exemption under the Notification No. 8/2008-ST. The matter is remanded to the Adjudicating Authority only for the limited purpose of verifying the threshold exemption with respect to the turnover - penalty is deleted - appeal allowed by way of remand. 2018 (8) TMI 622 Valuation - demand of service tax on security deposit made by tenant - Whether Service Tax has been rightly demanded on the amount of security deposit made by the tenant to the Appellant/landlord? Held that:- The demand raised in the impugned order is erroneous being made on the refundable security deposit. Such refundable amount cannot form consideration as defined under Section 67. The demand of Service Tax on the amount of annual rent of ₹ 84,000/-, as defined in the agreement is confirmed - Appellant shall also be liable to pay interest on the delayed deposit - penalty is set aside. Appeal allowed in part. 2018 (8) TMI 621 Refund of Service Tax paid - Time Limitation - Section 11B of the Central Excise Act, 1944 - Held that:- The amount of Service Tax paid by the appellant during the disputed period had also been deposited by such service provider in the Central Government account. Since such service provider has not served any food or beverages in a restaurant, eating joint or a mess and provided altogether a different taxable service to the appellant within its factory premises, the condition no. 19 prescribed in the notification dated 20.06.2012 have not been fulfilled, for claiming refund benefit of Service Tax paid by the service provider. Refund not allowed - appeal dismissed - decided against appellant. 2018 (8) TMI 620 Refund of CENVAT Credit - rejection on the ground that the input services have no nexus with the output service exported by the appellant - Held that:- In view of the fact that the authorities below have denied the refund benefit mostly on the ground that there is no nexus between input services and output service provided by the appellant, the matter should go back to the original authority for consideration of the provisions of the amended Rule 5 read with TRU letter dated 16.03.2012 and thereafter, to determine whether the appellant is eligible for the benefit of refund as per the prescribed formula - appeal allowed by way of remand. 2018 (8) TMI 619 Penalty u/s 78 - amount towards service tax and interest deposited by the appellant before issuance of the show-cause notice - Held that:- Due to bonafide belief that service tax was not payable on legal service, the appellant did not pay the service tax amount into the Central Government account. However, on pointing out the mistake by the audit wing, the service tax amount towards such taxable service was paid before issuance of the show-cause notice. With regard to mismatch in the figure of taxable value reflected in the periodic return vis-à-vis the Balance Sheet, the submission of the appellant are that due to non-receipt of commission amount from the service receivers, the same was not reflected in the returns filed by the appellant and that on actual receipt of the said amount, the particulars where duly reflected in the records subsequently. Penalty u/s 78 - Held that:- It is an undisputed fact that the Department has not brought on any tangible evidence to prove involvement of the appellant in fraudulent activities - penalty set aside. Appeal disposed off. 2018 (8) TMI 618 CENVAT Credit - input services - Outdoor Catering Services - Works Contract Service - Held that:- Though the services are in the nature of works contract, but were not related to construction of building or civil structure or laying of foundation etc. Since the nature of the activities provided by the service providers to the respondent as per the contract and as indicated in the invoices have not been properly scrutinized by the authorities below. The matter should go back to the original authority for proper verification of the invoices / contract to ascertain whether, the works contract services provided by the service provider to the respondent are confirming to exclusion category of service provided under the definition of input service - appeal allowed by way of remand. 2018 (8) TMI 617 Payment/adjustment from the cenvat account - Held that:- The report dated 4.7.2018 has not properly prepared and captured the actual cenvat credit taken and utilized for payment of service tax on the disputed taxable service - the matter should go back to the original authority for proper computation of the service tax liability and for ascertaining the fact whether, the adjudged amount, in question, had already been deposited by the appellant, as contended by the learned Advocate - appeal allowed by way of remand. 2018 (8) TMI 616 Condonation of delay in filing appeal - Held that:- There is a delay of 365 days in filing this civil appeal which is not satisfactorily explained - appeal dismissed on the ground of delay. 2018 (8) TMI 614 Refund claim of service tax on services which were exempted with retrospective effect - Illegal action of CPWD in adjusting security deposit of the petitioner - unjust enrichment - Held that:- In the execution of works contract for CPWD; as per the then prevailing law, the service tax was collected by the petitioner and deposited with the Government revenue. Subsequently, however, the law was amended by virtue of which, in relation to the construction carried out by the petitioner for CPWD, service tax was exempted with retrospective effect. It is undisputed position that such tax was not required to be paid. The amended provision also envisaged refund of service tax already paid, if application is filed within prescribed time - The appellant who had paid the excise duty to the manufacturer viz. M/s. Indian Oil Corporation Limited and BPCL in the instant case, had the necessary locus standi to file the application claiming the refund of the duty. In the present case, it was therefore upto the CPWD to apply for refund of the service tax which was paid as per the law prevailing at the relevant time, but which became refundable on account of retrospective amendment in the law. The CPWD instead of applying for refund, itself insisted that the petitioner must apply and when the petitioner’s application for refund was rejected by the Assistant Commissioner of Service Tax, Ajmer, CPWD found a novel way to recover the same from the petitioner by utilizing the petitioner’s security deposit, unpaid amounts of final bill and the petitioner’s running bills of other contracts. These are wholly impermissible means of recovery. There is no iota of doubt that this Court has territorial jurisdiction to examine the legality of the action of CPWD - The orders passed by the Assistant Commissioner of Central Excise & Service Tax, Ajmer of course have a territorial origination outside the State, however, these two actions and orders are inter-linked and cannot be separated one from the other for testing the legality. The proceedings are placed back before the Assistant Commissioner of Central Excise & Service Tax, Central Excise& Service Tax Division, Ajmer [Rajasthan]. It would be open for the CPWD to join in the said application as a co-applicant. If so done by 30th June 2018, the competent authority shall decide such application on merits. We also hold that not the petitioner, but the CPWD can pursue the refund claim. Petition disposed off. 2018 (8) TMI 601 Refund of service tax paid - Rule 5B of the CENVAT Credit Rules, 2004 - rejection on the ground that the respondent being a recipient of taxable service and not a service provider, the provisions of Rule 5B of the rules read with N/N. 12/2014-Central Excise (N.T.) dated 03.03.2014 are not applicable and accordingly, refund application is not maintainable - Held that:- It is an admitted fact on record that the respondent does not provide any taxable service and is also not registered with the Service Tax department for providing any taxable service. However, the respondent is registered with the department for payment of service tax on the taxable services received by it and discharged the service tax liability on reverse charge mechanism, as provided under sub-section (2) of Section 68 of the Finance Act, 1994. Since the respondent discharged the service tax liability in the capacity of recipient of service, Rule 5B should be equated with Rule 5 of the rules, for grant of refund of service tax paid on the taxable services. This Tribunal in the case of United News of India v. Commissioner of Service Tax, New Delhi [2017 (3) TMI 17 - CESTAT NEW DELHI] has held that when the recipient pays service tax on receiving the taxable service, the provisions of section 66 of the Act [pari-materia with Section 68(2)] should be available for claim of the benefit contained in the N/N. 17/2004-ST dated 10.09.2004. Appeal dismissed - decided against Revenue. Central Excise 2018 (8) TMI 615 Condonation of delay in filing appeal - Section 35H of the Central Excise Act - Held that:- The petitioner was served with a duly attested copy of the order dated 19.03.2014, and the Commissioner (Appeals) has found that there is no denying the fact that the appellant (present petitioner) had received the attested copy of the said order. Against the impugned order as contained in Annexure-‘12’ passed by Commissioner (Appeals), the petitioner has got statutory remedy before ‘CESTAT’, therefore, finding that the petitioner has got the statutory remedy against the impugned order dated 19.03.2014 as well as the order contained in Annexure-’12’ to the present writ application, we are not inclined to exercise our powers in extra-ordinary writ jurisdiction to entertain the present writ application. Application dismissed. 2018 (8) TMI 613 Clandestine manufacture and removal - shortage of MS Ingots and inputs - stock taking based on eye-estimation - Held that:- Admittedly the stock of finished goods was also verified on eye-estimation basis inasmuch as there are neither any inventories nor any weighment slips produced by the Revenue to show that the said stock was actually weighed. The MS ingots being heavy material required weighment by a weigh-bridge and there is nothing to suggest about the method adopted by the officers for the weighment of the ingots in question - it is difficult to understand as to why two different and contra conclusions stand drawn by the appellate authority in respect of raw material and finished products. Apart from the alleged shortages, even if considered to be correct reflection of facts, there is no other evidence on record to corroborate the charges of clandestine removal and clearance of the final product - It is well-settled law that such charges are required to be established by production of positive and tangible evidence and the onus to discharge the same lies heavily on the Revenue. No further investigations stand made by the Revenue to corroboroate the said allegations, in the absence of which the findings arrived at by the lower authorities cannot be upheld. Appeal dismissed - decided against Revenue. 2018 (8) TMI 612 Classification of goods - various bought-out electrical items and accessories - Revenue entertained a view that the assessee-appellant is liable to Central Excise Duty on such BPL kits cleared by them to their clients. - process amounting to manufacture or not. Held that:- The appellant-assessee did not undertake any process in the form of assembling the electrical components and accessories which will result in a new identifiable product having a different character or use. The electrical components or switches are mounted on the board before clearance. The goods cleared by the appellant were generically called as BPL Kit. It is apparent that the method of clearance is mandated by the terms of agreement with their clients. There is no standard commercially identifiable item which is available for sale or purchase in the market. In other words, there is no BPL Kit commercially known and marketed. The clearances made by the appellant-assessee to the various clients as per their requirement are not any new manufactured product, commercially identifiable as BPL Kit. The process of mounting two components/items on the wooden or plastic board would not amount to manufacture - The Revenue did not produce any evidence or did not even assert that these are commercially known and marketed product. The electrical components retained their name, character and use and there is no new commercially identifiable product emerging in the present case - the appellants have not manufactured any dutiable item attracting central excise levy during the material time. Appeal allowed - decided in favor of appellant. 2018 (8) TMI 611 100% EOU - Refund of CENVAT credit - Rule 5 of CENVAT Credit Rules r/w N/N. 27/2012-CE dated 18.06.2012 - denial of refund on the ground of time limitation - Held that:- Refund of CENVAT credit is available as per Rule 5 of the CENVAT Credit Rules, 2004. Subject to procedure, safeguards, conditions and limitations as may be specified by the Board by notification in the official gazette. Thus it is clear that eligibility of refund under the Rules is subject to conditions which may be entitled by the Board. The notification which is issued by the Government or the Board is a subordinate Legislation. There is a well established mechanism for reviewing whether or not the conditions, safeguards, procedures and limitations imposed by the notifications are reasonable and are within the powers given to the Government by the Board. Hence, powers of framing rules or issuing notifications are given to the Government which is answerable to the Parliament. It is also well known that if the Parliament feels that the notifications required amendment, they direct the Government to do so. This power of deciding or amending or revising the conditions, safeguards, limitations, etc, is not given to either Quasi Judicial Authorities or to the officers. The learned first appellate authority has clearly erred in sanctioning the refund taking a larger view of what is good to promote exports, etc., and such perceived “equity” has no place in interpretation of a fiscal statute and the notification must be strictly construed - appeal allowed - decided in favor of appellant. 2018 (8) TMI 610 CENVAT Credit - duty paying invoices - credit was availed on the basis of the quadruplicate copy of the invoice which was found in the appellant’s record - Held that:- It is on record that the appellant has lost the duplicate copy of the invoice which was to accompany the goods, from the supplier. However, after taking up the matter with the supplier, they have produced quadruplicate copy of the invoice which evidences supply of inputs. To this effect appellant submitted an affidavit also on record regarding the receipt of the inputs. In the case of Rathi Special Steels Ltd. [2017 (1) TMI 1482 - CESTAT NEW DELHI] the Tribunal has expressed the opinion that if the primary evidence is not given, then secondary evidence is admissible as per the proviso to Section 63 of the Indian Evidence Act, 1872. Credit allowed - appeal allowed - decided in favor of appellant. 2018 (8) TMI 609 CENVAT Credit - Whether a demand can be raised seeking reversal of CENVAT credit on the ground that the inputs could not have been used in manufacture of final products because the losses were much higher as per the standard industry norms? - Held that:- The suspicions by themselves cannot form a basis for demand unless investigations can establish as to what had happened in that case - the demand in the show cause notice is based on the mathematical calculations based on the average losses as per the benchmark of actual losses and on the presumption that the differential amount relates to inputs which have been clandestinely removed. The amount of duty sought to be reversed is also calculated based on the average value of the inputs and average rates of duty - such demand based on mathematical calculation is not supported by law. Whether the assessee is entitled to the credit of CENVAT on invoices which show that the goods were received in vehicles which on verification were found to be not capable of transporting the goods? - Held that:- It is evident that it is impossible to carry inputs weighing in tonnes in these vehicles. If the assessee asserts that they had, in fact, received the goods in these vehicles, it is for them to show how. It is a well established principle that ‘he who asserts must prove’. This is especially true when one claims an evident impossibility to be a fact - the assessee could not have received inputs in them and is not entitled to the CENVAT credit on the invoices under which the goods were supposed to have been received from M/s Lakshmi Gayatri Iron and Steel Ltd. - The penalty on the assessee under Rule 15(2) of the CENVAT Credit Rules r/w Section 11AC is also reduced to ₹ 2,26,303/-. The penalty on Shri Anil Kedia, Managing Director of assessee is reduced to ₹ 50,000/-. Appeal allowed in part. 2018 (8) TMI 608 Job-work - who is liable to pay duty - N/N. 83/1994-CE dated 11.04.1994 - Whether the assessee is eligible for exemption under Notification No.83/1994-CE for the goods manufactured by them on job work basis? - Held that:- If the exemption notification is a conditional notification, all conditions must be fulfilled and it is for the assessee to show that they have fulfilled the conditions. If the assessee fails to establish that they have fulfilled all the conditions of the notification, they are not entitled to the benefit of the same. In this case, the exemption notification requires the supplier of raw material to give an undertaking to the jurisdictional authorities of Central Excise having jurisdiction over the assessee that they will pay the relevant excise duty. Thus although the job worker is a manufacturer by virtue of the exemption notification r/w declaration made by the raw materials supplier, the burden of discharging excise duty shifts on to the raw material supplier. The Revenue has a strong case as far as the allegation that the appellant has not fulfilled conditions stipulated in the N/N. 83/1994-CE is concerned - It a fit case to be remanded back to the original authority. Appeal allowed by way of remand. 2018 (8) TMI 607 CENVAT Credit - capital goods - PTFE, Corrugate Hose Pipe, Anyhydrous Therminol – 55, Fuel Pil, Additives, Well Glass fitting, Steam Joining sheet, Vee Belt, Epoxy Primer, Gland Packing Jointing Sheet etc. - Held that:- The issue has been set at rest and that needs no further adjudication by the Tribunal. Hence the appeal filed by appellant company M/s. Deepak Nitrite Ltd. is allowed and appellant is eligible for the credit and therefore demand is not sustainable - The order of Commissioner (Appeals) confirming the order of first adjudicating Authority is hereby set aside. Credit allowed - appeal allowed - decided in favor of appellant. 2018 (8) TMI 606 CENVAT Credit - Since the appellant availed CENVAT credit of CVD paid on the scrap items on the strength of the Bill of Entry, without actual receipt of the said goods for manufacture of final products, the Department proceeded against the appellant for denial of the CENVAT benefit - Held that:- It is manifest from the available records that the Commissioner (Appeals) has not properly considered the submissions made before him by the appellants. The matter should be remanded to the original authority for consideration of the submissions to be made by the appellants regarding its claim in support of receipt of the duty paid scrap material in its factory premises - appeal allowed by way of remand. 2018 (8) TMI 605 Validity of SCN - Time Limitation - impugned order assailed on the ground that the SCN has been issued by the Department beyond the period of 5 years from the relevant date and accordingly, the proceedings initiated cannot be sustained - Held that:- There is confusion regarding actual mode of communication of the adjudication order on the appellant - also, the Department was not in possession of any documentary evidence to prove the date of receipt of the show-cause notice by the appellant. Since the period in dispute is March 2005 to April 2005, the show-cause notice should have been issued within 5 years from such relevant date. In view of the fact that the notice had been issued after 5 years, the same cannot be acted upon for confirmation of the adjudged demand. Appeal allowed - decided in favor of appellant. 2018 (8) TMI 604 Cash refund of accumulated CENVAT credit - whether the appellant are entitled to take credit of ₹ 64,087/-, which was initially claimed as cash refund of accumulated cenvat credit under Rule 5 of the CENVAT Credit Rules, 2004? - Held that:- It is not in dispute that the accumulated CENVAT credit refunded as cash was again deposited to the Government treasury with interest - there are no reason to allow credit of the amount of ₹ 64,087/- to the appellant - credit allowed - appeal allowed - decided in favor of appellant. 2018 (8) TMI 603 CENVAT Credit - denial on the ground that since the goods were sent for job work under exemption N/N. 214/86 C.E dated 25.03.1986, the said goods should be considered as exempted goods, as per the provisions of Clause (d) of Rule 2 of the Cenvat Credit Rules, 2004 - scope of SCN - Held that:- The learned Commissioner (Appeals), found that he has proceeded against the appellant on the ground that the goods manufactured on job-work basis are not the final product of the appellant - Since such observations recorded in the impugned order were not the subject matter of dispute in the show-cause notice, seeking for denial of Cenvat benefit, the impugned order passed entirely on new ground cannot stand for judicial scrutiny. Appeal allowed - decided in favor of appellant. 2018 (8) TMI 602 Valuation - inclusion of Pre Delivery Inspection charges and Cost of free services incurred by the dealers in their assessable value - whether the value of Pre Delivery Inspection charges and After Sales Service charges incurred by the dealers on the motor vehicles purchased from the appellant be included in the value of the motor vehicles while determining the excise duty on the same? - Held that:- It is the contention of the appellant that after 1.3.2003, they have not claimed deduction on account of Pre Delivery Inspection charges and After Sales Service charges incurred by their dealers in providing such services from the assessable value of vehicles sold, even though the said amount was reimbursed to them. To this claim of the appellant, the Revenue has not placed any contrary evidence. Also, Hon’ble Supreme Court in TVS Motors Co. Ltd. case [2015 (12) TMI 874 - SUPREME COURT] observed that Pre Delivery Inspection charges and after Sales Service charges cannot form part of assessable value of motor vehicles. Appeal allowed - decided in favor of appellant. CST, VAT & Sales Tax 2018 (8) TMI 600 Imposition/liability of interest under Section 8(1) of the U.P. Sales Tax Act, 1948 - purchase of Opium - Section 3-AAAA of the Act. Held that:- Admittedly the revisionist is a Union of India undertaking and it deals in procurement, distribution as well as export of Opium its derivatives and life savings medicines and exportation thereof - The admitted fact that the assessing authority has passed the assessment orders for all the assessment year in question in the year 1979 and thereafter. No tax was admitted by the revisionist Union of India as it disputed the applicability of the provisions of the Act on the ground that the revisionist is not a dealer, is not liable to tax in view of Article 285 of the Constitution of India and that the procurement of Opium and sales and manufactured product is not liable to tax. The facts in the present case prima facie establishes that in fact the revisionist has never admitted any liability of purchase tax. It was not the tax which was admittedly payable by the revisionist - the revisionist in fact has agitated its claim before the assessing authority by filing an application under Section 22 as such has disputed its liability from very inspection/binning. In this view of the matter, the same cannot be treated to be "admitted tax" or tax "admittedly payable" for the purpose of Section 8(1) of the Act. There was a bona fide dispute raised by the revisionist regarding liability for tax thereon, thus, it cannot be said to be its admitted taxable turnover and, therefore, there is no liability for payment of interest under Section 8(1) of the Act - The revision petitions are allowed and the assessing authority is directed to redetermine the interest in view of the provisions of Section 8(1-A) read with section 8(1-B) of the Act. Revision petition allowed by way of remand. 2018 (8) TMI 599 Time Limitation - whether this Court can entertain a Revision Petition under Section 48(1) of the Himachal Pradesh Value Added Tax Act, 2005, which is filed beyond the period of limitation so prescribed in the Statute? Held that:- There is no provision whatsoever contained in Himachal Pradesh Value Added Tax Act, 2005 by virtue of which it con be inferred that that any provision of Limitation Act was to apply to a proceeding under this Act - application of Section 5 of the Limitation Act to a proceeding under Section 48 of the Himachal Pradesh Value Added Tax Act, 2005 stands excluded by necessary implication, by virtue of the language employed in Section 48. It is relevant to refer to the law laid down Hon’ble Supreme Court in Hukumdev Narain Yadav v. Lalit Narain Mishra [1973 (12) TMI 92 - SUPREME COURT], wherein it has been held that where a Statute is a complete code in itself, meaning thereby that it is a substantive as well as procedural code, then the application of Limitation Act has to be seen from the scope of application of the Statute and not the Limitation Act. Thus, Himachal Pradesh Value Added Tax Act, 2005, is a complete code in itself, which, in other words, is both a substantive as well as a procedural law and as there is no provision contained in the Act, making the provisions of Limitation Act applicable to the proceedings which are to originate from the Act - this Court has no inherent power to condone the delay in entertaining a Revision Petition which stands filed beyond the period of limitation prescribed in the Act. The applications for condonation of delay in filing the Revision Petitions are not maintainable - application dismissed. Indian Laws 2018 (8) TMI 633 Dishonor of Cheque - sufficient evidence to prove dishonor of cheque within statutory period. Held that:- In the present case, if the findings of the trial Court that the appellant had failed to prove dishonour of cheque and that the complaint could not be said to have been filed within limitation, are found to be erroneous, then the impugned order acquitting the respondent will have to be reversed. Since the trial Court found that the issue of legal debt or liability was proved by the respondent, the only question that arises in the present case is, as to whether it could be said that there was sufficient evidence to prove dishonour of cheque to conclude that the respondent had committed offence under Section 138 of the said Act - once such a memo or slip issued by the bank bearing its official mark concerning dishonour of cheque is placed on record by the complainant, the burden is clearly on the accused to disprove the fact of dishonour of cheque. When the basic fact of dishonour of cheque was not proved by the appellant and the burden was not discharged, offence under Section 138 of the said Act could not be said to have been committed by the respondent. Another important aspect of the present case is that when there is lack of evidence to show dishonour of cheque and consequently the date when the cheque was dishonoured, there is no reference point to ascertain as to whether the notice for demand of payment was issued by the appellant to the respondent within the period of 30 days of receipt of information from the bank regarding return of cheque as unpaid, as provided under proviso (b) to Section 138 of the said Act - This is the reason why the trial Court has held that the appellant failed to prove that she made demand for payment of amount within the statutory period, as the statutory period could not be computed in the facts of the present case. Analysis of the provisions of the said Act, particularly Sections 138, 142 and 146 thereof, shows that cognizance of the offence under Section 142 of the said Act could not have been taken by the Court in the present case because the basic fact of dishonour of cheque could not be proved by the appellant - the complaint in the present case was correctly rejected by the trial Court, thereby acquitting the respondent. Appeal allowed - decided in favor of appellant. 2018 (8) TMI 632 Whether the Appellate Tribunal has committed an error in holding that, the provisions of the RERA are applicable to the 'Agreement of Lease' executed between Appellant and Respondents? - Held that:- The intention of the Legislature, which is found reflected in the 'Objects and Reasons' of the Act and its various provisions, makes it abundantly clear that, to all the projects, wherein the possession of the apartments is to be handed over in consideration of the sale price or the market price, such projects are included under the purview of this Act. It has to be held that, the Legislature would have never intended to exclude the persons like the Respondents, who have invested their hard-earned money in such projects, from the protective and benefcial provisions of this Act. Here the Hayden's Rule of Suppression of Mischief needs to be applied with full force and if that Rule is applied, then the provisions of the RERA are required to be held as equally applicable to the long term leases, like the present one of “999 years”; or, where the substantial amount of consideration is already obtained by the 'Developer'. Then the definitions of the terms 'Allottee', or, 'Real Estate Project', or, even that of 'Promoter', are required to be interpreted in that context and not in isolation, by placing reliance simplicitor on the word 'selling' used in these three definitions - Merely because the Legislature has excluded the allotment, when it is given on rent, it does not exclude the long term lease like the present one. That will be defeating and frustrating the object of the Act. The Appellate Tribunal has rightly held that, so far as the present case is concerned, considering the long term lease of '999 years', it would definitely amount to sale. Whether the Appellate Tribunal has committed an error in holding that, the 'Adjudicating Authority' under the RERA has jurisdiction to entertain the complaints filed by the Respondents, under Section 18 of RERA? - Whether the Adjudicating Authority, under the RERA, can go behind the 'Registration Certificate' of the Appellant, so as to hold that it has no jurisdiction, though the project is registered under the said Act? - Held that:- This course is not permissible under the law to challenge the Registration Certificate issued by one 'Authority' before the another 'Authority' and calling upon that 'Authority' not to consider such 'Certificate of Registration' and then to hold that the RERA is not applicable to the said project. Once there is registration under the RERA, then it follows that, all the provisions of the RERA become applicable to such project, unless some phases are specifically excluded from registration. It also becomes applicable to the persons, who have invested in the said real estate project. It is applicable both, to the Appellant and also to the Respondents. The Appellant, after having taken the advantage of registration under the RERA, cannot turn back and say that the provisions of the RERA are not applicable to the complaints made by the Respondents in respect of the very same project - The Appellant had, therefore, no choice but to get their project registered under the RERA, considering that it was for development of the plot, exceeding the area of more than 500 sq.mtrs. and it was for the number of apartments exceeding 8, inclusive of all phases. The very fact that the Appellant has got itself registered under the RERA makes it necessary to infer that, the Appellant was very well aware that this project was for sale of the apartments constructed in the project and that is why, it was bound by the provisions of the RERA - there is no question of applying the logic that, if the project is not registered, whether the RERA will not be applicable, even if it is otherwise proved to be a project of development, because, as per the mandate of the RERA, all the real estate projects are now required to be registered, if the apartments therein are constructed for the purpose of sale or otherwise. The fact that the Appellant has, therefore, registered the project also makes it necessary to infer that, the Appellant has invited upon itself the applicability of the provisions of the RERA, as Appellant is also fully aware that whatever 'Agreements' executed by it with the Respondents are in the nature of sale, though they are titled as 'Agreements of Lease'. The dispute in the present case definitely falls within the jurisdiction of RERA. The interplay of all the provisions contained in the Act, coupled with the real purport of the 'Agreement of Lease', leads to no other inference, but to hold that, the complaints filed by the Respondents before the 'Adjudicating Officer', under Section 18 of the Act, are definitely maintainable and the 'Adjudicating Officer' is having the jurisdiction to entertain and decide those complaints. Appeal dismissed. 2018 (8) TMI 631 Cheque bounce case - Prosecution proceedings u/s 138 of the Negotiable Instruments Act - Whether moratorium prohibiting institution of a proceeding as provided for in Section 14 of the Insolvency and Bankruptcy Code, 2006 (hereinafter referred to as Code) applies even to a criminal proceeding. - Held that:- The criminal revision should not have been directed to be kept in abeyance by resorting to Section 14 of the Code. For that matter even the National Company Law Tribunal in its order in a proceeding under Section 10 could not have and has not specifically directed any prohibition against the continuation of a criminal proceeding. The learned Additional Sessions Judge has committed a gross illegality in directing the criminal revision to be kept in abeyance by the impugned order. The order is not sustainable in law and is liable to be quashed and set aside. 2018 (8) TMI 630 Dishonor of cheque - Prosecution of the respondents - it was alleged that no payments had been made by them pursuant to the notices of demand in the wake of dishonor of certain cheques which had been issued by the respondents in favour of the petitioner (complainant) towards discharge of their liability. Held that:- The legislature has thus clarified that the court within whose local jurisdiction the branch of the bank where the payee or the holder in due course maintains the account in which the cheque in question is delivered for collection would ordinarily be the court of competent jurisdiction to take cognizance of and inquire into and try the offence under Section 138 of the Negotiable Instruments Act, 1881. By this reckoning, the court of the Metropolitan Magistrate at New Delhi District would be the jurisdictional court to deal with the criminal complaint cases in as much as the cheques in question here were presented by the petitioner for collection through its bank having branch in Connaught Place, New Delhi. The criminal complaint cases would stand revived on the file of the concerned Metropolitan Magistrate of New Delhi district, who is directed to proceed further thereupon in accordance with law - petition allowed.
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