TMI Tax Updates - e-Newsletter
August 3, 2017
Case Laws in this Newsletter:
GST
Income Tax
Customs
Corporate Laws
Service Tax
Central Excise
CST, VAT & Sales Tax
Indian Laws
Highlights / Catch Notes
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GST:
Rule 61 - Where a return in FORM GSTR-3B has been furnished, after the due date for furnishing of details in FORM GSTR-2 - Special provisions for adjustment of tax dues, input tax credit and modifications based on the discrepancies
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GST:
Rule 46 - Tax invoice - Special provision for mentioned the details in respect of supplies meant for export extended to supplies to SEZ
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GST:
Rule 44 - Manner of reversal of credit under special circumstances - Reversal of ITC under GST - Sub Rule (2) and (3) substituted - Where tax invoice is not available for reversal, market price of the goods on the effective date of the occurrence of the events will be taken.
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GST:
Rule 34 - Rate of exchange of foreign currency for the purpose of GST - in case of taxable goods, as per the rate notified under Customs Act and in case of taxable services, as per the the generally accepted accounting principles, for the date of time of supply
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GST:
Rule 24 - Migration of persons registered under the existing law - Date of surrender of GST registration where not required extended upto 30-09-2017
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GST:
Enforcement of the G.S.T. - Entitlement to collect entertainment tax as in the past upto 31st March, 2020 and to retain the percentage of it in accordance with the scheme - U.P. Entertainments and Betting Tax Act, 1979 - A petition before HC
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Income Tax:
Validity of assessment order - Wrong mention of section as u/s 153A instead of 143(3)/153A - non compliance of mandatory issue of notice u/s 143(2) - curable defect u/s 292B - Assessment order is not valid - HC
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Income Tax:
Permanent establishment of the assessee in India - Revenue to show that notwithstanding the RBI permission continuing during the AYs in question, the Assessee’s LO should be construed to be a PE in terms of Articles 5 (1) and 5 (2) of the DTAA. - HC
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Income Tax:
Depreciation on expenditure incurred on the development of software as well as purchase of software is capital in nature - at the rate of 25% or at the rate of 60% - it is the substance of the matter which should be looked into rather than the form or the nomenclature.
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Customs:
High sea sales of imported goods are akin to inter-state transactions. - GST council has decided that IGST on high sea sale (s) transactions of imported goods, whether one or multiple, shall be levied and collected only at the time of importation i.e. when the import declarations are filed before the Customs authorities for the customs clearance purposes for the first time.
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Customs:
Reimbursement of Central Sales Tax (CST) - respondents are not legally justified in withholding the same for the reason that the petitioner has not purchased raw material from DTA on the basis of the Circular dated 14.01.2015, which is not only in conflict with the provisions of the FTP but is illegal otherwise also which cannot override the FTP. - HC
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Customs:
Import of Fishing Trawlers - - they have come to Indian Customs Waters only for the purpose of completing import formalities and also registering them as fishing vessels, only to go back to high seas for deep sea fishing for export, insistence of payment of duty on the ship stores is definitely not in sync with the provisions for foreign going vessels.
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DGFT:
Import of cigarette or any other tobacco product shall be subject to the provisions contained in the Cigarettes and other Tobacco Products (Packaging and Labelling) Amendment Rules, 2017 - Notification
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DGFT:
Amendment in import policy - To prohibit import of Red Sanders (Pterocarpus santalinus)
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Central Excise:
Refund claim - whether the appellant is entitled to take refund claim of reversal of cenvat credit under protest which has not been appropriated at any stage or not? - Refund allowed.
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Central Excise:
Manufacture - Assembly installation and commissioning of switching system - the goods which have been purchased Switching systems have remained the switching systems only even after installation and in our view no new commodity with distinct commercial identity or character or use has emerged.
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Central Excise:
100% EOU - DTA clearance - the fact of the respondents not availing cenvat credit is not a relevant consideration in deciding the question whether they comply with N/N. 23/2003-CE - this Tribunal held that the assessee is not required to pay the differential duty.
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VAT:
Valuation - Cardamom - UPVAT - market rate relied upon for the purposes of undervaluation is not the market rate shown to exist in the market area, where the transaction itself has taken place. - HC
Articles
Notifications
DGFT-
18/2015-2020 - dated
1-8-2017
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FTP
Amendment in Para 13 of the General Notes Regarding Import Policy of ITC (HS), 2017 - Schedule -1 (Import Policy) - Import of cigarette or any other tobacco product shall be subject to the provisions contained in the Cigarettes and other Tobacco Products (Packaging and Labelling) Amendment Rules, 2017
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17/2015-2020 - dated
1-8-2017
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FTP
Amendment in import policy conditions of items under Exim Code 44039918 under Chapter 44 of ITC (HS), 2017 - Schedule - 1 (Import Policy) - To prohibit import of Red Sanders (Pterocarpus santalinus)
GST - States-
MGST-1017/C.R.104/Taxation-1. - dated
27-7-2017
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Maharashtra SGST
Corrigendum to Notification-Tax Rate[No. 1/2017-State Tax (Rate)], dated the 29th June 2017
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MGST-1017/C.R.103(1)/Taxation-1. - dated
27-7-2017
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Maharashtra SGST
Corrigendum to Notifcation Exempted goods [Notificaion No. 2/2017-State Tax (Rate)], dated the 29th June 2017
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FIN/REV-3/GST/1/08 (Pt-1) “X” - dated
6-7-2017
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Nagaland SGST
The Nagaland Goods and Services Tax (Third Amendment) Rules, 2017.
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FIN/REV-3/GST/1/08 (Pt-1) “T” - dated
30-6-2017
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Nagaland SGST
Intra-State supplies shall be paid by the electronic commerce operator
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FIN/REV-3/GST/1/08 (Pt-1) “O” - dated
30-6-2017
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Nagaland SGST
Exempts the intra-State supply of services of description as specified in column (3).
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FIN/REV-3/GST/1/08 (Pt-1) “N” - dated
30-6-2017
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Nagaland SGST
Notifies that the state tax, on the intra-State supply of services.
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FIN/REV-3/GST/1/08 (Pt-1) “E” - dated
30-6-2017
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Nagaland SGST
Exemptions intra-State supplies of goods.
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FIN/REV-3/GST/1/08 (Pt-1) “D” - dated
30-6-2017
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Nagaland SGST
Notification for NGST Rate of Goods.
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FIN/REV-3/GST/1/08 (Pt-1) “B” - dated
30-6-2017
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Nagaland SGST
The Nagaland Goods and Services Tax (Second Amendment) Rules, 2017.
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FIN/REV-3/GST/1/08 (Pt-1) “A” - dated
30-6-2017
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Nagaland SGST
The Nagaland Goods and Services Tax (First Amendment) Rules, 2017.
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FIN/REV-3/GST/1/08 (Pt-1) - dated
27-6-2017
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Nagaland SGST
The Nagaland Goods and Services Tax Rules, 2017. & Forms.
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FIN/REV-3/GST/1/08 (Pt-l)/354 - dated
22-6-2017
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Nagaland SGST
State Government notifies www.gst.gov.in as the Common Goods and Services Tax Electronic Portal for facilitating registration, payment of tax, furnishing of returns, computation and settlement of integrated tax and electronic way bill
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FIN/REV-3/GST/1/08 (Pt-l)/353 - dated
22-6-2017
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Nagaland SGST
U/s 1(3) of the Nagaland Goods and Services Tax Act, 2017 the State Government appoints the day of 24th June, 2017 as the date on which the provisions of sections 1, 2, 3, 4, 5, 10, 22, 23, 24, 25, 26, 27, 28, 29, 30, 139, 146 and 164 shall come into force
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FIN/REV-3/GST/1/08 (Pt-1)/352 - dated
22-6-2017
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Nagaland SGST
U/s 23(2) of the Nagaland Goods and Services Tax Act, 2017 Specifying the category of persons exempt from obtaining registration
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11664/CT POL-41/1/2017 - dated
27-7-2017
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Orissa SGST
CORRIGENDUM - Inadvertent typographical mistake in this Office Notification No. 11516/CT., Dt. 25.07.2017.
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11516/CT POL-41/1/2017 - dated
25-7-2017
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Orissa SGST
Assignment of Powers and Duties to Officers of State Tax as "Proper Officer" under the OGST Act' 2017
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11344/CT POL-41/1/2017 - dated
22-7-2017
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Orissa SGST
Notification on extension of the period of filing of intimation to opt for composition levy.
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S.R.O. No. 330/2017 - dated
17-7-2017
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Orissa SGST
Amendments in the Notification No. SRO number 296/2017 - on exemption of tax on dried leguminous vegetables.
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S.R.O. No. 329/2017 - dated
17-7-2017
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Orissa SGST
Notification of tax rate of Bran @ 2.5% along with some other changes in the tax rate.
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S.R.O. No. 296/2017 - dated
29-6-2017
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Orissa SGST
Exemption intra-State supplies of goods.
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S.R.O. No. 295/2017 - dated
29-6-2017
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Orissa SGST
Notification on the rates of State tax on goods.
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S.R.O. No. 294/2017 - dated
29-6-2017
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Orissa SGST
The Odisha Goods and Services Tax (Amendment) Rules, 2017.
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S.R.O. No 289/2017 - dated
24-6-2017
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Orissa SGST
The Odisha Goods and Services Tax Rules, 2017.
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G.O.Ms. No. 21/CT/2017-18 - dated
31-7-2017
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Puducherry SGST
The Puducherry Goods and Services Tax (Fourth Amendment) Rules, 2017.
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G.O.Ms. No. 16/CT/2017-18 - dated
10-7-2017
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Puducherry SGST
The Puducherry Goods and Services Tax (Third Amendment) Rules, 2017.
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F.No.12(56)FD/Tax/2017-Pt-I-63 - dated
5-7-2017
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Rajasthan SGST
Corrigendum - regarding Notification No. F.12(56)FD/Tax/2017-Pt.-I-40 dated 29.06.2017
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F.No.12(56)FD/Tax/2017-62 - dated
1-7-2017
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Rajasthan SGST
Notification under section 9(1) of the Rajasthan Goods and Services Tax Act, 2017 regarding reduction in the rate of State Tax, on fertilisers from 6% to 2.5%.
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F.No.12(46)FD/Tax/2017-Pt-I-56 - dated
30-6-2017
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Rajasthan SGST
Rajasthan Goods and Services Tax (Second Amendment) Rules, 2017.
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F.No.12(56)FD/Tax/2017-Pt-I-38 - dated
29-6-2017
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Rajasthan SGST
The Rajasthan Goods and Services Tax (Amendment) Rules, 2017
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F.No.12(46)FD/Tax/2017-31 - dated
22-6-2017
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Rajasthan SGST
The Rajasthan Goods and Services Tax Rules, 2017
SEZ-
S.O. 2423(E) - dated
27-7-2017
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SEZ
Amendment in Notification No. S.O. 2177(E) dated 5th July, 2017
Circulars / Instructions / Orders
News
Case Laws:
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GST
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2017 (8) TMI 44
Enforcement of the G.S.T. - Entitlement to collect entertainment tax as in the past upto 31st March, 2020 and to retain the percentage of it in accordance with the scheme - U.P. Entertainments and Betting Tax Act, 1979 - effect of C.GS.T. and U.P.G.S.T. Acts - Held that:- Referring to petitioner that in view of Section 174 of the U.P.G.S.T. as there is no notification repealing the benefit conferred upon the petitioner under the scheme of the Act, he is entitle to collect entertainment tax as in the past upto 31st March, 2020 and to retain the percentage of it in accordance with the scheme and counsel appearing for the respondents No. 1 and 3 and Sri Krishna Agarwal, who has accepted notice on behalf of respondent No.2 are directed to file counter affidavit within one month. Two weeks thereafter are allowed to the petitioner for filing rejoinder affidavit. They would specifically answer if the scheme granting tax benefit to the petitioner is still continuing or stand revoked either automatically or by any fresh notification.
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Income Tax
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2017 (8) TMI 80
Validity of assessment order - Wrong mention of section as u/s 153A instead of 143(3)/153A - non compliance of mandatory issue of notice u/s 143(2) - curable defect u/s 292B - Held that:- this fact is not disputed that no notice under Section 143(2) was ever issued - Revenue did not dispute seriously that mention of Section 153A was an error and that will not vitiate the assessment order but since assessment was claimed to have been completed under Section 143(3) and if that be so, notice under Section 143(2) was mandatory and non-compliance thereof vitiates assessment, therefore, we answer Question-I in favour of Assessee and against Revenue holding that Tribunal was justified in dismissing appeal of Revenue not for quoting wrong provision but, in substance, for non-compliance of a mandatory provision which was not treated to be a mere procedural irregularity in various authorities as discussed above. - Decided in favour of assessee.
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2017 (8) TMI 79
Permanent establishment of the assessee in India - Avoidance of Double Taxation between India and Japan - Held that:- the mere fact that the Manager of the Assessee stated that the books of accounts might be kept in a warehouse (which was unable to be shown by the Revenue to exist) or that some portion of the telephone expenses were attributable to the LO or that Mr. Ishibashi was managing both the LO as well as the PO was hardly sufficient to conclude the LO was being used to carry on the business of the enterprises. The basic factual foundation for holding a LO of the Assessee as its PE has not been laid by the Revenue in the present case. The fact that the Assessee was adhering to the conditions imposed by the RBI for running a LO, and the RBI had accepted the functioning of the Assessee’s LO for over three decades, points out to the fact that the Assessee has complied to the conditions, one of which was that it could not carry on any business or trading activity in the LO. While, it is a moot question whether this would be binding on the Revenue, it certainly increases the burden of the Revenue to show that notwithstanding the RBI permission continuing during the AYs in question, the Assessee’s LO should be construed to be a PE in terms of Articles 5 (1) and 5 (2) of the DTAA. The Court has undertaken the exercise of again examining the factual position since in the impugned order the ITAT has merely relied upon its order for an earlier AY. While the Court appreciates the contention put forth by the Revenue that the facts of each AY has to be separately considered, the Court finds that there is no ground made out to disturb the reasoned order of the CIT (A) for both the AYs. ITAT was correct in holding that the Assessee did not have a PE in India and was therefore exempt under the provisions of the DTAA between India and Japan. ITAT was right in holding that the offices of the Assessee and its activities during the AY in question could not be regarded as its PE in India and the income directly or indirectly attributable to the said offices was not taxable in India. Assessee does not have any PE in India and its income from business turnover/imports in India was exempt in view of DTAA between India and Japan. - Decided in favour of the Assessee and against the Revenue.
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2017 (8) TMI 78
Provisions of section 206C(1C) - liability to collect tax at source as provided - Held that:- The construction/interpretation of the contract referred to by the parties as concessionaire agreement would be of vital importance in ascertaining whether the assessee entered into the same on its own account and for and on behalf of itself or whether it did so as a nodal agency for and on behalf of the Government of Punjab. That contract has not even been produced before us. Further the matter may not end by a mere reading of the contract. It may be necessary to consider the surrounding circumstances if the terms thereof are not clear. It is impossible, therefore, in these appeals to determine the issue. We have decided the alternate issue in certain other appeals against the assessee by a separate order and judgment passed by us in (CIT (TDS) v. Punjab Infrastructure Development Board [2016 (12) TMI 1534 - PUNJAB AND HARYANA HIGH COURT] which is also the assessee's case. It would, however, be necessary for the Tribunal to decide both the issues.
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2017 (8) TMI 77
Disallowance of amortization charges of leasehold land - Held that:- There is no material on record to show that assessee has made these payments as advance rent for future years to secure any reduction in rent payable for future years or for any other business consideration. We are, therefore, unable to appreciate arguments advanced by Ld. Counsel that these advances paid are towards advance rent. Even from the terms of agreements, it is not clear as to whether advances paid has been adjusted against future rent or whether these are in the nature of security deposits which are refundable in nature on termination of agreements. Both parties before us have expressed their intention regarding issue being re-adjudicated by assessing officer de novo. Accordingly, we are inclined to set aside this issue to Ld. AO for fresh adjudication. Ld. AO shall investigate upon and take all necessary steps to ascertain true nature of alleged lease premium paid by assessee in the three agreement made as per law. Depreciation at rate of 60% on computer peripherals allowed. See CIT vs. BSES Yamuna Power Ltd.[2010 (8) TMI 58 - DELHI HIGH COURT ] Addition on account of Sec. 14A read with Rule 8D - Held that:- Issue of section 14A read with Rule 8D for year under consideration is also set aside to Ld. AO with a similar direction to re-compute disallowance of expenditure under section 14A read with Rule 8D as per ratio laid down by Hon’ble Delhi High Court in the case of Cheminvest Ltd., vs CIT [2015 (9) TMI 238 - DELHI HIGH COURT].
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2017 (8) TMI 76
Sale of shares - business income or capital gain - Held that:- We find that the assessee has been investing in shares for the last more than ten years. He has always shown the shares purchased as ‘Investment’ in the balance sheet for all the years and valued the same at cost. The gains arising from sale of shares was also classified by the assessee as capital gains only. The assessee has earned dividend of ₹ 28,37,719/- during the financial year 2006-07 relevant to the impugned assessment year. We find that the Co-ordinate Bench of the Tribunal in the case of the assessee for the A.Y. 2004-05, A.Y. 2008-09 and A.Y. 2009-10 have held the share transactions as capital gains and not as income from business. Addition u/s 14A read with rule 8D - Held that:- We find that the AO has worked out the disallowance u/s 14A r.w.r. 8D. The same rule is not retrospective as it was notified on 24/03/2008 and would be applicable only from AY 2008-09. In Godrej & Boyce Mfg. Co. Ltd. (2010 (8) TMI 77 - BOMBAY HIGH COURT ), it has been held that Rule 8 D is not retrospective. The Hon’ble Bombay High Court in CIT vs. M/s. Godrej Agrovet Ltd [2014 (8) TMI 457 - BOMBAY HIGH COURT] has held that percentage of the exempt income can constitute a reasonable estimate for making disallowance in the years earlier to the assessment year 2008-09. In the above case it upheld the disallowance to the extent to 2% of the total exempt income.Respectfully following the above decision, we direct the AO to restrict the disallowance to 2% of the total exempt income. Disallowance u/s 94(7) out of business loss claimed by the assessee - whether the loss incurred on sale of securities to the extent of dividend income earned is not allowable, which was confirmed by the learned CIT(A) - Held that:- There is merit in the contentions of the learned counsel of the assessee that in case, loss for scrips held for 6 months is treated as STCL, then the disallowance u/s 94(7) must also be made out of STCL and not out of business loss. In view of the above, the order of the learned CIT(A) on the above issue is set aside and the AO is directed to restrict the disallowance to ₹ 1,56,177/- under the business head and adjust the balance of ₹ 37,560/- against STCL under capital gains head. Disallowance of interest expenses - Held that:- We find that (i) 99.46% of funds is interest free funds (ii) 0.32% of funds is interest free borrowed funds and (iii) 0.22% is interest bearing funds bearing in a common pool of funds. In the case of Reliance Utilities & Power Ltd. (2009 (1) TMI 4 - BOMBAY HIGH COURT ), it is held that “if there be interest-free funds available to an assessee to meet its investments and at the same time the assessee has raised a loan, it can be presumed that the investments were from the interest-free 9 funds available.” We follow the ratio laid down in the above judgement and delete the disallowance of ₹ 40,500/- made by the AO
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2017 (8) TMI 75
Penalty under Section 271(1)(c) - concealment of particulars of income or for furnishing inaccurate particulars of such income - Held that:- The entire penalty proceedings initiated in the instant case are vitiated as the notice issued is not in accordance with law, inasmuch as, the said notice nowhere specified whether the proceedings were being initiated for the reason of concealment of particulars of income or on account of furnishing of inaccurate particulars thereof. Even the satisfaction note made in the assessment order or the penalty order also does not indicate whether it was a case of concealment of income or furnishing of inaccurate particulars of income. Therefore, laying our hands on the decisions of Gujrat High Court in the case of Manu Engineering, [1978 (9) TMI 18 - GUJARAT High Court] and Virgo Marketing [2008 (1) TMI 885 - DELHI HIGH COURT] where it has been held that levy of penalty has to be clear as to the limb 8 for which it is levied and the position being unclear penalty is not sustainable, we are of the considered opinion that the penalty imposed in the instance case is void ab initio. Similar view has been taken by Hon’ble Karnataka High Court in Manjunatha’s case (2013 (7) TMI 620 - KARNATAKA HIGH COURT). We, therefore, cancel the penalty imposed u/s. 271(1)(c) of the Act on this legal aspect itself and hence, we need not to enter into other grounds or reasons for penalty and their explanations extended by the assessee on merits. Appeal of the assessee is allowed.
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2017 (8) TMI 74
Reopening of assessment - reasons to believe - Held that:- There was no mention in the recorded reasons that the escapement of chargeable income from tax was due to omission or failure on the part of the assessee to disclose fully and truly all material facts necessary for the assessment. Therefore, the notice for re-opening was quashed. Besides, we concur with the submissions of the Ld. AR that no new facts have come to the knowledge of the AO justifying assumption of jurisdiction after four years. The orders of the authorities below also nowhere reveal as to what new facts or material came to their notice which led them to make re-assessment in the instant case. A bare reading of first proviso to section 147, shows that the law merely casts a duty on the assessee to disclose fully and truly all material facts necessary for his assessment which has been done in the instant case. The duty of the assessee does not extend beyond the disclosure of all material facts necessary for his assessment. It is thereafter the duty of AO to properly apply its mind on the facts and law. Accordingly, the assumption of jurisdiction u/s 147 is unsustainable in the instant case in view of the decision of Hon’ble Delhi High Court in the case of Purolator India Ltd.(2011 (11) TMI 365 - DELHI HIGH COURT ) - Decided in favour of assessee.
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2017 (8) TMI 73
Depreciation on expenditure incurred on the development of software as well as purchase of software is capital in nature - at the rate of 25% or at the rate of 60% - Held that:- Income Tax Act, 1961 and the Income Tax Rules, 1962 prescribe the rate of depreciation on computer software at the rate of 60% from 01/04/2003, prior to which the rate of depreciation was 25% only. Hence, as per the rate prescribed by the Income Tax Rules, the assessee is entitled to depreciation at the rate of 60% and the action of the assessee in claiming the depreciation on the basis of the amended rate of depreciation on software cannot be faulted with and the same cannot be restricted to 25% merely on the ground that depreciation was claimed at the rate of 25% till assessment year 2003-2004. Although, the assessee has classified the software under ‘computer software and intellectual property rights’, it is very well settled that nomenclature cannot be conclusive and decisive regarding the nature of transaction and it is the substance of the matter which should be looked into rather than the form or the nomenclature by which the same might have been called. - Decided against revenue
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2017 (8) TMI 72
Addition on account of difference in stock - Held that:- The assessee is said to be maintaining books of accounts on day to day basis and the purchase and sales were properly vouched. Section 34 of the Indian Evidence Act provides books of accounts, regularly kept in the course of business are relevant wherever they refer to a matter into which the court has to inquire. Thus, entries made in the books of accounts maintained in the ordinary course of business would be relevant evidence and, thus, they would, to some extent, carry with them a presumption of truth. The books of accounts of the assessee had been duly audited as per the requirement of section 44 AB of the Income Tax Act, 1961. The assessing officer has not pointed out any defect in the books of accounts but has simply substituted the value of stock as per books of accounts with the information supplied by the bank although the book results were held to be correct. Moreover, in the instant appeals it is a case of hypothecation and not of pledge and as such the stock is not with the bank. The Tribunal has also, on numerous occasions, held that addition on this account was not justified where the books of accounts or the accounting system had been found to be genuine duly supported by vouchers etc. Thus, addition on account of difference in stock can be made only on the basis of adequate material and not arbitrarily. Admittedly, there was a difference between the value of stock declared to the bank and the stock as per books of accounts but there is no dispute that the assessee had been maintaining proper books of accounts on the day to day basis and the sales and purchases were duly supported with vouchers and there was no finding as to suppression of any purchase or sales - Decided in favour of assessee.
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Customs
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2017 (8) TMI 57
Reimbursement of Central Sales Tax (CST) - Validity of Circular dated 14.01.2015 issued by the respondent no.3 Director, Software Technology Parks of India, Department of Electronics and Information Technology, Ministry of Communication and Information Technology, Government of India - reimbursements on goods purchased from EOUs or from Special Economic Zone - authority to process the claim - Held that: - It is only in respect of the benefit of deemed exports and export duty drawback that Clause (a) stipulates for the supplies from DTA but no such stipulation is contained in Clause (a) for conferring the benefit of reimbursement of CST - The Circular dated 14.04.2015 has been issued by the Director, STPI, Department of Electronics and Information Technology, Ministry of Communication and Information Technology, Government of India, whereas the FTP, which contains paragraph 6.11 is statutory policy under Section 5 of the Foreign Trade (Development and Regulation) Act, 1992 formulated and issued by the Ministry of Commerce and Industry, Government of India. Therefore, the provisions and the benefits conferred therein cannot be taken away by any subordinate authority or legislation. The petitioner is an EOU, who is purchasing goods as a raw material from another EOU or similar units other than DTA and therefore is entitled to reimbursement of CST in terms of paragraph 6.11(c)(i) of the FTP, 2009-14 and the respondents are not legally justified in withholding the same for the reason that the petitioner has not purchased raw material from DTA on the basis of the Circular dated 14.01.2015, which is not only in conflict with the provisions of the FTP but is illegal otherwise also which cannot override the FTP. Authority responsible for the reimbursement of CST to the petitioner - Held that: - The Hand Book of the Procedures under the FTP clearly lays down that the claims for reimbursement of CST shall be presented inter alia to the designated officer of the STP and that the disbursing authority of such claimed amount will inter alia be the designated officer of the STP, who will make payment to the units claiming reimbursement - the liability is squarely cast upon the designated officer of the STPI to receive application for reimbursement and to make payment thereof if necessary. Circular No. STPN /CST /2015 dated 14.01.2015 illegal and issues a writ of mandamus directing the respondent no.1 to process reimbursement claim of CST of the petitioner in respect of goods purchased by it from non-DTA and to make payment thereof to the petitioner in terms of paragraph 6.11(c)(i) forthwith - petition allowed - decided in favor of petitioner.
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2017 (8) TMI 56
Jurisdiction - power to issue SCN by the officers of DRI/SIB/Commissioner of Customs(Prev.). - Held that: - the powers of officers working in these organizations to issue notice under Customs Act, 1962 as proper officers has been subject matter of decision by various High Courts - we set aside the impugned orders and remand the matter to the original authority to decide the question of jurisdiction first and thereafter on merit after the matter is settled by the Hon’ble Supreme Court in the pending appeals by the Revenue against the decision of Hon’ble Delhi High Court in the case of Mangali Impex Vs. Union of India [2016 (5) TMI 225 - DELHI HIGH COURT] - appeal allowed by way of remand.
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2017 (8) TMI 55
Confiscation - penalty - import of Fishing Trawlers - benefit of N/N. 21/2002-Cus. dt.1.3.2002 as amended - whether the disputed goods are in the nature of ship stores or otherwise and in consequence, whether customs duty is required to be paid on the same? - Held that: - There can also be no dispute that once the fishing trawler complete its shore modalities and goes to the high seas for their intended fishing operations, they will have to be treated as foreign going vessel in terms of Section 2 (21) of the Customs Act, 1962 reproduced in para 4.6 above. Even the CBEC Customs Manual of Instructions, in Chapter 2, Para-15 thereof clarifies that consumables can remain on board without payment of duty - CBEC vide circular No.89/88/CX.6 dt. 30.12.1988 has further clarified that stores for consumption on board a vessel would cover stores, both consumable and non-consumable, meant for use in a ship. There is no proof or allegation whatsoever that impugned ship bait and other consumables were not used for high seas fishing operations or that they were illicitly removed into the DTA. Especially, when these trawlers themselves have been subject to ‘Nil’ rate of duty and it is not in dispute that they have come to Indian Customs Waters only for the purpose of completing import formalities and also registering them as fishing vessels, only to go back to high seas for deep sea fishing for export, insistence of payment of duty on the ship stores is definitely not in sync with the provisions for foreign going vessels and certainly run counter to the avowed intent of the government to promote exports. Appeal dismissed - decided against appellant.
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2017 (8) TMI 54
Penalty - smuggling - poultry vaccines - Held that: - I do not find any material regarding the involvement in the alleged offence. It is well settled that the imposition of penalty would be warranted on the materials available on record against the accused. Regarding the appeal filed by Dr Amrit Jyoti Mudoi, I find from the impugned order that the DRI Officers recovered two exercise books used by Dr. Amrit Jyoti Mudoi in which all the transactions related to receipt of smuggled vaccines from Shri Sudhir Kumar Mahajan and the payment made to him were recorded - I am unable to accept the submission of the Ld. Counsel of Dr. Amrit Jyoti Mudoi for the reason that they are not claiming the Indian Currency. In any event, the evidence on record would show the involvement of Dr. Amrit Jyoti Mudoi in the alleged offence. Appeal dismissed - decided against appellant.
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2017 (8) TMI 53
DEPB benefit - export of 100% polyester fabrics - Revenue entertained a view that these goods which were exported were substantially over valued in order to avail inadmissible benefit under DEPB scheme - Held that: - the legal provision regarding the demand of duty from the person who is the beneficiary of the instrument issued by the authorities under Foreign Trade (Development and Regulation) Act, 1992 has been introduced only w.e.f. 28.05.2012, as Section 28AAA in the Customs Act, 1962. Introduction of such provision in the substantive law itself makes it clear that there is no legal sanction prior to that date to hold the person to whom, the instrument was issued as a person liable to Customs duty. It is necessary for the officer adjudicating the customs duty liability, to identify the importer/ person who is liable to such duty in terms of the provisions of Customs Act, 1962. The present order in so far as it relates to confirmation of Customs duty jointly and severally on more than one person is accordingly, not legally sustainable. The rejection of FOB value originally assessed by the officers and comparing the value of different exporters to determine the FOB value of the main appellant - Held that: - Since we find that the original authority has not properly arrived at, the identity of the person from whom, duty demand can be confirmed and ordered recovery of such duty jointly and severally, we set aside the impugned order and remand the matter back to the original authority to first examine this legal issue to fix the liability, if any, on the identified persons specifically. The cross examination sought for by the appellants have not been accepted by the original authority on the ground that the same is not a fundamental right. We note that it is a well settled legal principle that the cross examination of witnesses whose statements are admitted as evidence has to be considered in terms of section 138B of the Customs Act. The said provisions are identical to the provisions of Section 9D of the Central Excise Act, 1944 - this aspect requires re-examination. Penalties - Held that: - no act or omission on the part of the custodian has been brought out in the impugned warranting penalties either under Customs Act or Regulation of 2009. As such these two appeals by The That Dry Port are allowed. Appeal allowed in part and part matter on remand.
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Corporate Laws
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2017 (8) TMI 49
Proper status of a Promoter/Director of Sahara Sponsor who holds about 80% of its capital and who controls all Sahara Group Companies - Held that:- In the instant case SEBI itself found that two group companies of Sahara and its Directors were not conducting their business following the rules relating to public issue and were restrained from associating themselves with any listed Company or Company which intends to raise money from the public. It was also found that one of the Promoters/Directors is prima facie holding absolute control over the group companies. Given these facts and circumstances, lifting the corporate veil to the extent of identifying the role of the Promoter/Director in the impugned order cannot be faulted. In this context, the order of this Appellate Tribunal in the matter of Financial Technologies India Ltd. vs. SEBI [2015 (8) TMI 381 - SECURITIES APPELLATE TRIBUNAL MUMBAI] upholding the order of the WTM of SEBI holding the appellant company and directors therein not a fit and proper person solely based on the decision of the Forward Markets Commission is relevant. We also note that, though subsequent to the impugned order, the RBI has cancelled the certificate of registration granted to the Sahara Sponsor to carry on the activities of NBFC and has initiated steps to wind up the Sahara Sponsor under the RBI Act, with the Allahabad High Court (Lucknow Bench) restraining the Company from alienating its assets. In the result, we find no merit in the appeal. Accordingly, appeal is dismissed with no order as to costs. Consequently, Misc. Application No. 188 of 2017 becomes infructuous and the same is also disposed of accordingly.
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2017 (8) TMI 48
Petition filed u/s 482 of Criminal Procedure Code - complaint filed by ROC against the Directors for failure to lay before the Company in Annual General Meeting held the balance sheet and profit and loss account for the period required under sub-sections (1) and (3) of Section 210 - Held that:- The resignation of the appellant was accepted on 16.06.1997 in the meeting of Board of Directors of the Company, and the Registrar of Companies was informed of the same by filing Form No. 32 in terms of Section 303(2) of the Act. The appellant, an advocate, is more than eighty years of age and suffering from various serious ailments. Also the other five similar complaints as against the appellant, which are in respect of the meetings held on the dates subsequent to 1997, have already been quashed by the High Court. In the above circumstances, we are inclined to accept the argument that the High Court erred in not quashing the criminal proceedings in question. Accordingly the appeal is allowed.
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2017 (8) TMI 47
Civil suit to declare the appointment/co-option of some of the defendants/Directors of a Private Limited Company - grant permanent injunction restraining them from any manner functioning as Directors of that company - injunction restraining the said company from conducting any Extraordinary General Body Meeting/Annual General Body is maintainable in a civil court, in the light of Section 430 of the Companies Act, 2013 - Held that:- The word member employed in Section 241 of the Act cannot be given a restricted meaning. If restricted meaning is given, it may lead to abuse of the process law, as it is found in this case. Hence, it is essential to apply the doctrine of reading down to make the provisions under Chapter XVI of the Act purposeful. The golden Rule of statutory construction is that the words and phrases or sentences should be interpreted according to the intent of the legistature that passed the Act. Section 241 and 242 should be read together. If the words of the statutes raises doubt, it is inevitable to call in aid the ground and cause of making the statute and the mischiefs, which the Act intends to redress. Under the new Companies Act, 2013, the intention of the legistature is to vest the power of adjudication the matters referred in Section 242 to the Tribunal. On applying the Doctrine of Reading Down, an internal aid to construe the word in a statute to give reasonable meaning, so as to give the supposed purpose the word member referred in Section 241 of the Act, should not be read in isolation or in strict meaning. The word should be read down along with Section 242 of the Act. Therefore, the phrase 'member of the company' in Section 241 mean and include person not only member of the company is strict sense but, also person who bears the character of a member or have substantial interest in the internal affairs of the company . If the plaintiffs claim status as non-member, the disclosed cause of action in the plaint is illusion and irrelevant for third parties, since they have no locus standi to interfere with the affairs of the indoor- management of a Private Limited Company. If they claim status as Directors of the Company, they carry all trappings/characters of a member of the Company. So, to protect the interest of the Company, the remedy for them is under Section 242 of the Companies Act, 2013. Either way the Civil Court has no jurisdiction to entertain the subject matter of the suit. In the light of Section 430 of the Companies Act, 2013 and the alternate redressal forums being adequately provided under the Act, the plaint is not maintainable. Civil Revision Petition is allowed.
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Service Tax
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2017 (8) TMI 71
Annual maintenance contract - revision of rate of service tax after 10.9.2004 - N/N. 5/2004-ST dated 9.7.2004 - whether the appellant is required to pay differential amount of service tax for remaining part of annual maintenance contract or not? - Held that: - Admittedly, in the case in hand, rate of service tax was 8% when the annual maintenance contracts were entered by the appellant with their clients and the service was reckoned prior to 10.09.2004. The service is rendered as and when the contract is entered - similar issue decided in the case of Bajaj Allianz General Insurance Co.Ltd. vs. CCE, Pune [2008 (10) TMI 72 - CESTAT MUMBAI], where it was held that enhancement of tax rate is not applicable to the polices issued prior to such enhancement - the enhancement of rate of tax on 10.9.2004 has no application to the facts of this case - appeal allowed - decided in favor of appellant.
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2017 (8) TMI 70
‘Rent a cab’ service - demand on the ground that appellant are the owners and they have to keep the vehicle in their own garage and take care of repairs and maintenance but required to operate the buses in specified routes by APSRTC, incurring all the operating cost, paying all taxes and compensation in the case of any accidents and accounting for it - Held that: - similar issue decided in the case of SK. Kareemun W/o. Khadeer and others Versus Commissioner of Central Excise, Customs And Service Tax Hyderabad-III [2015 (1) TMI 282 - CESTAT BANGALORE], where it was held that service tax liability arises on the individual bus owners. By holding so, the Bench upheld the tax liability with interest but set aside the penalty. Decided partly in favor of appellant.
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Central Excise
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2017 (8) TMI 69
Penalty u/r 209A of the CER 1944 - job-work - clearance of goods without cover of any invoice and without paying the duty - Held that: - appellant cleared the goods on simple private challans/jobwork challans without following the procedure prescribed in Central Excise Law. The culpability of appellants is also proved by the fact that during the day of search, unaccounted stock of 3232 pcs of Towels valued at ₹ 2,14,096/- was found. In the subsequent statements also, the Director of the appellant no. 1 admitted that they have been clearing the goods without issue of invoice and without payment of duty. These statements have not been retracted at any stage - the appellants have not been able to convince as to why the goods manufactured during 30.09.99 to 22.12.2009 were not entered in RG-1. The appellant did not make any entry of daily production continuously for 3 months. He has also given a finding that the procedures and safeguards for job work were not followed and appellants were clearing the goods on private challans/gate passes. We uphold the order of commissioner (Appeal) is relation to demand, interest and penalty on appellant no. 1 - The appellant no. 2 was clearly aware of clandestine clearances as he was responsible for day to day working of the company. Hence, penalty has also been correctly imposed on him. Appeal dismissed - decided against appellant.
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2017 (8) TMI 68
Refund claim - rejected on the ground that the demand for which they filed refund claims has already been held against them - whether the appellant is entitled to take refund claim of reversal of cenvat credit under protest which has not been appropriated at any stage or not? - Held that: - it is admitted fact that the appellant reversed the cenvat credit under protest which was never appropriated by any authorities at any stage. In that circumstance, without appropriation of the said amount by the authorities below, the same was remained as deposit - in the light of the decision of the Hon’ble Apex Court in the case of Vikram Cements [2006 (1) TMI 130 - SUPREME COURT OF INDIA], the appellant was not required to reverse the said amount. In that circumstances, the appellant is entitled for refund of the said amount - appeal allowed - decided in favor of appellant.
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2017 (8) TMI 67
Penalty u/s 78 - case of appellant is that the period involved is 2003-2007 whereas the show cause notice has been issued on 30.10.2007. He argues that there was no wrong intention on the part of the appellant - extended period of limitation - Held that: - the business auxiliary service was brought within purview of service tax on 01.07.2003. Despite that, the appellant did not take registration and did not file any statutory returns. The appellant kept on suppressing the value of services, which were provided by them. The detection was made by the department on the basis of documents produced by the service receiver. Such documents revealed the suppression of value of taxable services rendered during the impugned period to the tune of ₹ 23,59,962/. Hence, in the SCN, the provisions of extended period have been correctly invoked. As such, the SCN has been issued within the statutory limit prescribed by the Act. As there is clear suppression, the penalty u/s 78 ibid has been correctly imposed on the appellant - appeal dismissed - decided against appellant.
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2017 (8) TMI 66
CENVAT credit - Revenue is of the view that the returned goods by the buyers were not sold after removing the defects, as buyers are quality cautious while receiving the goods, therefore, if the goods have been rejected once, they will not take it back. Therefore, it was alleged that the appellant has availed CENVAT wrongly - Held that: - the appellant has produced the evidence wherein the rejected goods has been cleared on payment of duty after rectifying the defects, no contrary evidence has been produced by the revenue - demand set aside. Valuation - It was alleged that as the appellant has cleared goods to their related persons at lower price, therefore, they required to pay duty of deferential value - Held that: - the appellant is clearing goods to related persons fact as well as to the other buyers on different prices. Therefore, the appellant is required to pay duty on the goods cleared to the related persons at the value on which the goods have been cleared to buyers. Liability of interest - supplementary invoices - Held that: - as per the decision of SKF India Ltd. [2009 (7) TMI 6 - SUPREME COURT], the appellant is required to pay on supplementary invoices. Appeal allowed in part - part matter on remand.
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2017 (8) TMI 65
Clandestine removal - it was alleged that in the guise of issuing the excess burning loss, the appellants are clearing the goods clandestinely without payment of duty - Held that: - the SCN were issued to alleging clandestine removal of goods only on the basis of audit conducted in their premises alleging that the burning loss claiming by the appellant is more than 2% i.e. 5.3%, 5.58 %, 5.49% respectively, which is less than 6-7% has clarified by the Ld. Chief Commissioner, Chandigarh vide letter dated 13.12.2011 and no other tangible evidence has been produced on record for clandestine removal of goods - reliance placed in the case of CCE & ST, Ludhiana Versus M/s. Om Steel Rolling Mills and others [2015 (10) TMI 1321 - CESTAT DELHI] - appeal allowed - decided in favor of appellant.
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2017 (8) TMI 64
Manufacture - Assembly installation and commissioning of switching system - Revenue is of the view that this activity of the appellant amounts to manufacture and appellant are required to pay Central Excise Duty on telephone exchanges which has come into existence and same is classifiable under the CTH 8517 - whether assembly installation and commissioning of switching system along with power plant, inverter etc. would amount to manufacture? - Held that: - the main component of a telephone exchange is switching system which is an electrical apparatus for line telephony. The power plant and inverter are only auxiliary equipments. Power plant supplies the 48V DC current for functioning the switching system and inverter is required for standby period in case of power break down. Thus, the goods which have been purchased Switching systems have remained the switching systems only even after installation and in our view no new commodity with distinct commercial identity or character or use has emerged. Appeal allowed - decided in favor of appellant.
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2017 (8) TMI 63
100% EOU - DTA clearance - Revenue is of the view that the appellant did not avail any cenvat credit on inputs, therefore, they did not fulfil condition No. (iii) of the N/N. 23/2003-CE. Therefore, they are required to pay duty in terms of serial number 4 of the N/N. 23/2003-CE dated 31.03.2003, attracting the Central Excise Duty at the rate of 30% of the Customs Duty plus cess which is applicable to similar goods when imported - Held that: - the identical issue has been dealt by this Tribunal in the case of M/s Cheema Spintex Ltd. 100% EOU [2017 (4) TMI 748 - CESTAT CHANDIGARH], where it was held that the goods for which exemption is claimed when manufactured and cleared by unit other than EOU should not be wholly exempted from the excise duty or should not be chargeable to nil rate of duty. It is evident that the fact of the respondents not availing cenvat credit is not a relevant consideration in deciding the question whether they comply with N/N. 23/2003-CE - this Tribunal held that the assessee is not required to pay the differential duty. The appellant is not required to pay any duty in terms of N/N. 23/2003-CE dated 31.03.2003 read with N/N. 29/2004-CE dated 09.07.2004 - appeal allowed - decided in favor of appellant.
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2017 (8) TMI 62
SSI exemption - valuation - brand name of others - N/N. 8/2001-CE dated 01.03.2001, 9/2002-CE dated 01.03.2002 and 9/2003-CE dated 01.03.2003 - Revenue felt that the appellants have wrongly availed the benefit of these notification, and that the valuation of goods cleared to their related person M/s. SEPL was also not done as per valuation Rules - Held that: - Once a finding is given that the goods bear the brand name of another ,the SSI exemption is not attracted and the value of clearances of such branded goods cannot be added to arrive at the aggregate value of clearances. SSI exemption - undervaluation - the department has alleged that there was the appellants is a partnership firm with Sh. Nathu Ram Goel, Sh. Sushil Kumar Goel and Madan Gopal as its partners. They are selling their goods to M/s. SPEL which also have Sh. Nathu Ram Goel and Sh. Sushil Kumar Goel as Directors. - Held that: - nothing was brought on record which would show that the price charged by the appellants from SEPL was obviously different from those charged from other buyers. Besides, the department could not show mutuality of interest or the money flow back between the different entities in question to establish that they are related concerns. Hence, there is no infirmity in the findings of Commissioner (Appeals) on this count. Appeal dismissed - decided against Revenue.
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2017 (8) TMI 61
Penalty u/r 15(i) of CCR, 2004 - CENVAT credit - GTA services - Held that: - the appellant had availed the CENVAT credit of the service tax paid on GTA services which were utilized by them for outward transportation of finished goods manufactured by them. The period involved in this case is July 2008 to October 2011 and during the relevant period, appellant's could claim that they have entertained a bonafide belief that they can avail the CENVAT credit of the service tax paid on outward transportation can be accepted, as the Larger Bench of the Tribunal in the case of ABB Ltd., [2009 (5) TMI 48 - CESTAT, BANGALORE] has held so being an activity related to the business. Equivalent amount of penalty imposed by the adjudicating authority and upheld by the first appellate authority seems unwarranted, as it is generally imposed only in the case of suppression, fraud, mis-statement of the facts with intent to evade duty. These three ingrediants are not alleged in the show cause notice nor there are any findings of the same in the orders of the adjudicating authority as well as the first appellate authority - the ends of justice may be met in this case if the penalty imposed on the appellant is reduced from ₹ 7,94,122/- ₹ 50,000/- under Rule 15(i) of CENVAT Credit Rules, 2004. Appeal allowed - decided partly in favor of appellant.
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2017 (8) TMI 60
CENVAT credit - various input services - commercial & industrial construction service - rent-a-cab service - security agency service - site formation and clearance service - Earth moving service - demolition service - club & association service - denial on the ground that the said services are not confirming to the definition of input service contained in Rule 2 (l) of the CCR, 2004 and those services have no nexus with the manufacture of the final products by the appellant - Held that: - Under the unamended definition of input service effective upto 31st March, 2011, there were no restrictions provided for non-consideration of construction service as input service. Such embargo was created only with effect from 01.04.2011 by N/N. 3/11-CE-NT dated 01.03.2011, wehrein construction service was specifically excluded from the definition of input service. Thus, the credit taken on commercial and industrial construction service prior to 31.03.2011 should be available for cenvat benefit - With regard to the credit availed after 01.04.2011, the appellant submits that the said services are in relation to repair, renovation of existing machinery, which are specifically finding place in the inclusive part of the definition w.e.f. 01.04.2011. However, on perusal of the case records, I find that authorities below have not specifically discussed the period, during which the cenvat credit was availed by the appellant. Thus, the said factual aspects have to be verified by the original authority for proper appreciation of the facts. Rent-a-cab service - Held that: - appellant relies on the decision of the Tribunal in the case of CCE, Delhi Vs. Pricol Ltd. [2015 (12) TMI 1486 - CESTAT NEW DELHI] to state that rent-a-cab service should be considered as input service for the purpose of cenvat credit. However, for ascertaining the period of availment of cenvat credit, the matter has to be verified by the original authority, since no observations were made with regard to such aspect in the original order. As regards the security agency service, the issue is squarely covered by the decision of the Tribunal in the case of Aluminium Powder Co. Ltd. Vs. C.C.E., Madurai [2015 (8) TMI 1234 - CESTAT CHENNAI]. Thus, respectfully following co-ordinate Bench decision, I am of the view that the cenvat benefit on such service can be extended to the appellant. As regards the other services namely, site formation & clearance, excavation and Club or Association Service, the authorities below have not addressed the issue as to whether the said services should be considered as input service for the purpose of cenvat benefit - in respect of the disputed services, except security agency service, the original authority should verify the period during which the cenvat credit was taken by the appellant. the matter is remanded to the adjudicating authority to decide the matter afresh after affording due opportunity of personal hearing to the appellant - appeal allowed by way of remand.
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2017 (8) TMI 59
Softwares - demand on the ground that these Software are required for functioning of simulators - Held that: - this issue of calculating the value of the software in simulator in respect of the appellant was being agitated for the period 03.05.2002 to 08.07.2003 and for the period 06.12.2003 to 29.10.2004. It is noticed that both these proceedings culminated in dropping of the proceedings raised in the show cause notice and these proceedings have been accepted by the Committee of Chief Commissioners and no appeals are preferred before the Commissioner. On this factual matrix, the findings of the adjudicating authority in this appeal seems to be in consonance of the law - appeal dismissed - decided against Revenue.
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2017 (8) TMI 58
Document to seek appeal - communication dated 8.5.2006 issued by the Deputy Commissioner of Central Excise, Panvel - Held that: - Perusal of these documents throws light that the appellant failed to provide respective details following the authority returned the claim. Appellant is directed not to multiply the litigation but provide relevant information called for by communication dated 8.5.2006 within four weeks of receipt of this order and plead its defence in any controversy - Learned authority considering the relevant details and pleadings of the appellant shall examine evidence and pass appropriate order - appeal is remanded to the Deputy Commissioner of Central Excise, Panvel Divison - appeal allowed by remand.
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CST, VAT & Sales Tax
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2017 (8) TMI 52
Valuation - Cardamom - proceedings in the instant case have been initiated on the premise that value of goods being imported was more than ₹ 1200-1300 per Kg. in the market at Lucknow and Kanpur, whereas value of big cardamom was disclosed at ₹ 160 per Kg - Held that: - As would be clear from the provisions contained under Section 48(1)(iii) and 48(5), as also under Section 54(1)(21-B), in case the allegation of undervaluation was levelled, the determination of rate/price to ascertain undervaluation had to be with reference to the market rate prevalent in the local market where the transaction itself had taken place. This Court finds substance in the submission that rate in the local market has not been ascertained nor has been relied upon for the purposes of determining the question of undervaluation. Action under Section 54(1)(21-B) - Held that: - The order of penalty is not sustainable for the reason that the penalty order transgresses the authority invoked while issuing notices under Section 54(1)(14) and as notices had not been issued calling for explanation of the revisionist under Section 54(1)(21-B) of the Act, the penalty order is not sustainable. So far as the question with regard to determination of undervaluation is concerned, also it is found that market rate relied upon for the purposes of undervaluation is not the market rate shown to exist in the market area, where the transaction itself has taken place. Appeal allowed - decided in favor of appellant.
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2017 (8) TMI 51
Validity of agency agreement - whether the agency agreement entered into between the petitioner and M/s Saroj Sales Corporation and M/s Kulliyath Steel Traders in Kerala and the transactions of consignment transfer made by the petitioner to the said agent can be disbelieved for the reason assigned by the third respondent? - Held that: - under sub-section 1 of section 6(A) Central Sales Tax Act and Form 'F' prescribed under Rule 12 (5) of the Central Sales Tax (Registration and Turnover Rules), 1957, there is no need or necessity for the agency to be always evidenced by a document in writing, but, it may also be oral and such an agency is deducible from the very nature of the transaction that took place between two different individuals and that the information required on the body of Form 'F' as to the date from which registration is valid and the first proviso to Rule 12(5) of Rules construed has to be considered in a liberal manner so as to foster or develope inter-state trade or commerce. Petition allowed - decided in favor of petitioner.
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2017 (8) TMI 50
Power to rectify any error apparent on the face of the record - how an application under Section 55 of the TNGST Act should be considered by the first respondent or that matter, the Assessing Officer or the Appellate Authority? - Held that: - A reading of the impugned order would show that the first respondent had very serious reservations about the order passed by the first respondent dated 02.05.2007. However, the first respondent, while exercising its jurisdiction under Section 55 of the Act cannot act as an appellate authority or a reviewing authority over the earlier order and the power is confined only to see whether the order requires a rectification. Thus, without noting this subtle, but very important legal distinction, the first respondent has made certain observations and did not go into the specific aspect raised by the petitioner with reference to the provision of the Additional Sales Tax Act. Therefore, the order passed by the first respondent calls for interference. The first respondent was required to consider only whether there was an error apparent on the face of the record and the error pointed out by the petitioner was not an error apparent on the face of the record. Unfortunately, the first respondent proceeded to re-examine the entire matter and opined that the earlier order, dated 02.05.2007, was not tenable, but thought fit to make an observation that they at this stage, cannot go into the merits of the case. Petition allowed - decided in favor of petitioner.
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Indian Laws
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2017 (8) TMI 46
Complaint under Section 138,141 and 142 of Negotiable Instrument Act - third accused has issued a cheque - Held that:- It is trite in law that the person who was issued the cheque in a personal capacity alone can be proceeded against in the event of cheque being dishonoured. In the instant case, the cheque in question was issued by the third respondent/accused and hence, proceeding against the second accused cannot be entertained and hence as against the second accused/revision petitioner, the proceedings have to be quashed.
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2017 (8) TMI 45
Offence under Section 138 of the Negotiable Instruments Act - liability against accused - whether the 3rd accused is also liable for the act committed on behalf of the Firm? - Held that:- In the absence of cogent, convincing and acceptable evidence that the 3rd accused was also actively participated in the day-to-day affairs of the 1st accused Firm, criminal liability cannot be fastened on her. Merely because she happened to be the wife of the 2nd accused and since she accompanied her husband at the time of borrowal, it cannot be presumed that she was also actively participated in the day-to-day affairs of the Firm. The Courts below failed to appreciate the evidence in that regard before imposing conviction against the 3rd accused. Accordingly, this Court hold that the conviction and sentence imposed against the 3rd accused for the offence under Section 138 of the Negotiable Instruments Act, are not proper and the same is not sustainable in law. Hence, the conviction and sentence imposed on the 3rd accused/ 3rd revision petitioner is liable to be set aside. In the result, the Criminal Revision case is allowed in part. The conviction and sentence imposed against the 3rd accused/ 3rd revision petitioner alone are set aside. The fine amount, if any, paid by the 3rd accused/ 3rd revision petitioner is directed to be refunded to her. The bail bond, if any, executed by her, shall stand cancelled. However, the conviction and sentence imposed by the Courts below on the other accused are confirmed. Nature of the imprisonment would be the same as ordered by the Courts below in the impugned judgments. The period of sentence already undergone by the 2nd accused, if any, is ordered to be set off. The trial Court is directed to take steps to secure the 2nd accused to undergo the remaining period of sentence, if any.
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