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TMI Tax Updates - e-Newsletter August 4, 2018 Case Laws in this Newsletter: GST Income Tax Customs PMLA Service Tax Central Excise CST, VAT & Sales Tax Wealth tax Indian Laws TMI SMS Jurisdiction - power to issue SCN - Deputy Director of DRI, DGRI, DGCEI, are entitled to function as proper officers u/s 28B and u/s 72 Highlights / Catch Notes GST: Levy of GST - supply of goods or services to SEZ unit or SEZ developer - IGST Act - Whether or not the supply of goods and on-site services to customers in SEZ area to any SEZ unit or SEZ developer is zero rated supply under section 16 of the Integrated Goods & Services Tax Act, 2017? - whether GST is chargeable for the supply of goods or services to SEZ unit or SEZ developer? Visit to Get Source Income Tax: Reopening of assessment - bogus expenditure - There is nothing to show that the entities to whom payments were made (by the assessee) were fictitious; in fact TDS amounts were apparently deducted. There was no fresh evidence supporting the reassessment. Consequently, there was no tangible, specific material to justify the impugned reassessment notice. Visit to Get Source Income Tax: Funds received in the form of share premium - additions u/s 56(2)(viib) r.w.s. 68 - Clause (viib) of Section 56(2) is triggered at the stage of computation of income itself when the share application money received, from a resident, by a Company, in which the public are not substantially interested; is above the face value. Visit to Get Source Income Tax: Carrying forward the loss u/s 72 r.w.s 80 - If the return is filed by the assessee within the reasonable time permitted by such notice u/s 153A(1)(a), such return would then be deemed to have been filed within the time permitted u/s 139 (1) of the Act for the benefit u/s 139(3) of the Act to be availed of by the assessee. Visit to Get Source Income Tax: Claim u/s 80G - charitable purpose - We do not see any charitable purpose in the application of the funds and we also notice that the trust had no control over the funds and acted merely as an agent of the assessee in carrying out the air-conditioning of the hall, if at all it was so carried out. Visit to Get Source Income Tax: Entitled to exemption u/s 11 and also u/s 10(23C)(vi) - assessee had collected huge extra consideration over and above the official fee - receipt of capitation fee - benefit of exemption cannot be denied. Visit to Get Source Customs: Jurisdiction - SEZ unit - power of the Development Commissioner - Petitioner had made false declaration to procure wrong GSP certification. They were beneficiaries of the wrong declaration, which had jeo-pardised and harmed the country‘s prestige and reputation - Penalty was justified. Visit to Get Source Customs: Jurisdiction - power to issue SCN - Deputy Director of DRI, is an officer, who is higher in rank than the Deputy Commissioner - Deputy Director or Assistant Director of Directorate General of Revenue Intelligence and Directorate General of Central Excise Intelligence are entitled to function as proper officers under Section 28 B and Section 72 Visit to Get Source Customs: Double benefit of DFIA Scheme availed - As per the conditions, the importer is duty bound to execute a bond binding himself to use the imported materials in his factory and not only that, he has to submit a Certificate of the jurisdictional Excise Officer regarding end use of the goods Visit to Get Source Service Tax: Cenvat credit while availing benefit of abatement - Benefit of N/N. 1/2006-ST dated 01.03.2006 - merely in some of the contract the appellant had availed the cenvat credit, and the same has no effect on the service where the exemption Notification No. 1/2006-ST was availed. Visit to Get Source Service Tax: Composite service or not - Contract of C&F cum packaging agent - demand of service tax on reimbursement of expenses - In the instance case the amounts recovered under independent separate clause of the agreement of the rate schedule constitute independent and separate services thus on merits the demand is sustained. Visit to Get Source Service Tax: Supply of manpower and agency service - partial reverse charge mechanism - Non-payment of 75% of service tax applicable on invoice value - payment of 100% taxable charges on services were individually collected by the service providers and they have deposited the same in the department as an agent of appellant. - Demand set aside. Visit to Get Source Service Tax: Classification of services - Even for the period w.e.f. 01/07/2012, the activity of transportation of coal from the coal face to the railway siding will continue to enjoy the benefit available to goods transport agency and cannot be bundled into a single service under Section 66F alongwith lifting of coal at the coal face into the activity of mining. Visit to Get Source Service Tax: Condonation of delay in filing appeal before the Commissioner (Appeals) - condonable period of limitation - No relief to the assessee from any superior authority be it Tribunal or HC or SC Visit to Get Source Service Tax: Valuation - inclusion of certain materials used in the execution of the contract of service - SC dismissed the appeal against the order of tribunal confirming the demand of service tax wherein it was held that, When the property of the goods is not transferred to the recipient of service, there was no sale of goods Visit to Get Source Service Tax: Service of repairing of footwear - sale or service? - Tribunal confirmed the demand of service tax by holding that such activity cannot be considered purely as sale of repair materials - SC stayed the order of CESTAT Visit to Get Source Central Excise: Waiver of Interest - Recovery of Excise Duty - BIFR Scheme - Under the garb of rehabilitating the petitioner company, the second respondent cannot be deprived of their statutory dues which are pending for a very long time. Visit to Get Source Central Excise: Method of Valuation - job-work - Scope of Rule 10A - the condition precedent, i.e supply of raw material by the principal to the other manufacturer, job worker is not satisfied in the facts of the present case - the show cause notice is misconceived. Visit to Get Source Central Excise: Reversal of cenvat credit - Revenue has itself treated the bio manure as a byproduct which arises during the course of manufacture of sugar and molasses. If that be so the provisions of Rule 6(3) would not apply. Visit to Get Source Central Excise: Service of Order - in the absence of the disclosure in the report of the Deputy Commissioner about the address at which the impugned order was affixed, the impugned orders, dismissing the appeals on the point of time bar are required to be set aside. Visit to Get Source Central Excise: Benefit of exemption - N/N. 64/95 - Even though the goods cleared may be tractors, the same have been put to use by SHAR for the purpose of launching projects. The said item therefore becomes covered under the notification - denial of exemption not justified Visit to Get Source VAT: Classification - If an entry has been interpreted consistently in a particular manner for several assessment years ordinarily it would not be permissible for the revenue to depart therefrom unless there is a material change. Visit to Get Source Articles CONTENT OF DIRECTOR’S REPORT FOR THE FY ENDED ON MARCH 31, 2018 Registration of GST with Practical Issues AN OVERVIEW-INPUT TAX CREDIT UNDER GST Key features of Draft GST Simplified Returns Notifications Customs 38/2018 - dated 2-8-2018 - ADD Seeks to extend Notification No. 24/2014-Customs (ADD) dated 21st May, 2014 GST F.No.354/255/2018-TRU (Pt-II) - dated 2-8-2018 - GST CESS Rate Corrigendum - Notification No. 2/2018-Compensation Cess (Rate), dated the 26th July, 2018 GST - States 68/GST-2 - dated 27-7-2018 - Haryana SGST Notification regarding amendment in notification no. 35/ST-2 dated 30.06.2017 under HGST Act, 2017 65/GST-2 - dated 27-7-2018 - Haryana SGST Notification regarding amendment in notification no. 48/ST-2 dated 30.06.2017 under HGST Act, 2017 64/GST-2 - dated 27-7-2018 - Haryana SGST Notification regarding amendment in notification no. 47/ST-2 dated 30.06.2017 under HGST Act, 2017 63/GST-2 - dated 27-7-2018 - Haryana SGST Notification regarding amendment in notification no. 46/ST-2 dated 30.06.2017 under HGST Act, 2017 G.O. Ms. No. 21/2018-Puducherry GST (Rate) - dated 27-7-2018 - Puducherry SGST SGST rate on intra-State supply of Handicrafts. G.O. Ms. No. 20/2018-Puducherry GST (Rate) - dated 27-7-2018 - Puducherry SGST Amendment to notification G.O. Ms. No.5/2017-Puducherry GST (Rate), dated the 29th June, 2017 on supplies of goods in respect of which no refund of unutilised input tax credit shall be allowed under section 54 (3). G.O. Ms. No. 18/2018-Puducherry GST (Rate) - dated 27-7-2018 - Puducherry SGST Amendment to notification G.O. Ms. No. 1/2017Puducherry GST (Rate), dated the 29th June, 2017 G.O. Ms. No. 17/2018-Puducherry GST (Rate) - dated 27-7-2018 - Puducherry SGST Amendment to notification G.O. Ms. No.11/2017-Puducherry GST (Rate), dated the 29th June, 2017 on State tax on services - Composite supply of Works Contract received by Government or Local. G.O. Ms. No. 16/2018-Puducherry GST (Rate) - dated 27-7-2018 - Puducherry SGST Amendment to notification G.O. Ms. No. 14/2017-Puducherry GST (Rate), dated the 29th June, 2017 supplies which shall be treated neither as a supply of goods nor a supply of service. G.O. Ms. No. 15/2018-Puducherry GST (Rate) - dated 27-7-2018 - Puducherry SGST Amendment to notification G.O. Ms. No. 13/2017-Puducherry GST (Rate), dated the 29th June, 2017on supply of services on which tax shall be paid under reverse charge mechanism. G.O. Ms. No. 14/2018-Puducherry GST (Rate) - dated 27-7-2018 - Puducherry SGST Amendment to notification G.O. Ms. No.12/2017-Puducherry GST (Rate), dated the 29th June, 2017 on exempted services. S.O.76/P.A.5/2017/S.096/2018 - dated 4-6-2018 - Punjab SGST Amendment in the Notification No. S.O.107/ P.A.5/2017/S.96/2017, dated the 7th December, 2017. S.O.75/P.A.5/2017/S.128/2018 - dated 4-6-2018 - Punjab SGST Waiver the late fee payable under section 47 of the said Act for failure to furnish the return in FORM GSTR-3B. G.S.R.38/P.A.5/2017/S.164/Amd.(14)/2018 - dated 4-6-2018 - Punjab SGST The Punjab Goods and Services Tax (Sixth Amendment) Rules, 2018. PA/ETC/2018/121 - dated 29-5-2018 - Punjab SGST Notify the National Academy of Customs, Indirect Taxes and Narcotics, Department of Revenue, Ministry of Finance, Government of India, as the authority to conduct the examination as per the said sub-rule. G.S.R.32/P.A.5/2017/S.164/Amd.(13)/2018 - dated 29-5-2018 - Punjab SGST The Punjab Goods and Services Tax (Fifth Amendment) Rules, 2018. S.O.74/P.A.5/2017/S.148/2018 - dated 21-5-2018 - Punjab SGST Council, by notification, specify any specialized agency of the United Nations Organisation or any Multilateral Financial Institution and Organisation notified. S.O.73/P.A.5/2017/S.164/2018 - dated 21-5-2018 - Punjab SGST Appoint the 1st day of April, 2018, as the date from which the provisions of rule 138, 138-A, 138-B, 138-C, 138-D and forms GST EWB-01, GST EWB-02, GST EWB-03, GST EWB-04 and GST INV-1. S.O.72/P.A.5/2017/S.11/2018 - dated 21-5-2018 - Punjab SGST Amendment in the Notification No. S.O.32/P.A.5/2017/S.11/2017, dated the 30th June, 2017. PA/ETC/2018/120 - dated 21-5-2018 - Punjab SGST Amendment in the order vide no. PA/ETC/2018/61 dated 23-03-2018. G.S.R.29/P.A.5/2017/S.164/Amd.(12)/2018 - dated 21-5-2018 - Punjab SGST The Punjab Goods and Services Tax (Fourth Amendment) Rules, 2018. 21/2018 –State Tax (Rate) - dated 26-7-2018 - Sikkim SGST Exempts the intra-state supplies of handicraft goods 20/2018-State Tax (Rate) - dated 26-7-2018 - Sikkim SGST Amendment in Notification No. 5/2017-State Tax (Rate), dated the 30th June, 2017 15/2018-C.T./GST - dated 30-7-2018 - West Bengal SGST Seeks to extend the due date for filing of FORM GSTR-6 for the periods of July, 2017 to August, 2018 till 30.09.2018. 1037-F.T. - dated 27-7-2018 - West Bengal SGST Seeks to prescribe concessional WBGST rate on specified handicraft items, to give effect to the recommendations of the GST Council in it’s 28th meeting held on 21.07.2018 1036-F.T. - dated 27-7-2018 - West Bengal SGST Seeks to amend Notification No 1129-F.T. dated 28-06-2017 to give effect to the recommendations of the GST Council in it’s 28th meeting held on 21.07.2018 1035-F.T. - dated 27-7-2018 - West Bengal SGST Seeks to amend Notification No. 1126-F.T. dated 28-06-2017 to give effect to the recommendations of the GST Council in it’s 28th meeting held on 21.07.2018 1034-F.T. - dated 27-7-2018 - West Bengal SGST Seeks to amend Notification No. 1125-F.T.. dated 28-06-2017 to give effect to the recommendations of the GST Council in it’s 28th meeting held on 21.07.2018 1033-F.T. - dated 27-7-2018 - West Bengal SGST Seeks to insert explanation in an item in notification No. 1135-F.T. dated 28.06.2017 by exercising powers conferred under section 11(3) of CGST Act, 2017 1032-F.T. - dated 27-7-2018 - West Bengal SGST Seeks to amend notification No. 1138-F.T. dated 28.06.2017 to notify that services by way of any activity in relation to a function entrusted to a municipality under Article 243W shall be treated neither as a supply of good nor a service 1031-F.T. - dated 27-7-2018 - West Bengal SGST Seeks to amend notification No. 1137-F.T. dated 28.06.2017 so as to specify services supplied by individual Direct Selling Agents (DSAs) to banks/ non-banking financial company (NBFCs) to be taxed under Reverse Charge Mechanism (RCM) 1030-F.T. - dated 27-7-2018 - West Bengal SGST Seeks to amend notification No. 1136-F.T dated 28.06.2017 so as to notify exempt some services as recommended by Goods and Services Tax Council in its 28th meeting held on 21.07.2018. 1029-F.T. - dated 27-7-2018 - West Bengal SGST Seeks to amend notification No. 1135-F.T. dated 28.06.2017 so as to notify CGST rates of various services as recommended by Goods and Services Tax Council in its 28th meeting held on 21.07.2018. 14/2018–C.T./GST - dated 12-7-2018 - West Bengal SGST Exemption from generation of e-waybill in case of intra-state movement of goods in West Bengal for job work 916-F.T. - dated 6-7-2018 - West Bengal SGST Amending the WBGST Rules, 2017 [ WBGST (Seventh) Amendment Rules, 2018] 915-F.T. - dated 6-7-2018 - West Bengal SGST Amendment of Notification No. 1132-F.T. dated 28.06.2017 suspending RCM u/s 9(4) till 30/09/2018 914-F.T. - dated 6-7-2018 - West Bengal SGST Amendment of Notification No. 1639-F.T. dated 14.09.2017 regarding State Level Screening Committee on anti-profiteering News Goods & Services Tax collections Amendments to the Goods and Services Tax (GST) Laws E-way Bill System Revenue from the Goods and Services Tax (GST) touched ₹ 7.19 lakh crore between August, 2017 and March, 2018 GST - Concept & Status as on 1st August, 2018 Deposits in Jan Dhan Accounts Vidyalakshmi Portal for Education Loan Reform in Banks: Government working on a four-pronged strategy to improve the health of the Banking Sector Non-Performing Assets (NPAs) of Public Sector Banks (PSBs) Representation from Whistleblowers at MSEI Sustainable Use of Water Need of the Hour- Suresh Prabhu 2,25,910 companies under scanner of MCA for not filing returns for Year 2015-16 & 2-16-17 MCA ordered inquiry in 87 real estate companies in 2017-18 Negotiable Instruments (Amendment) Act, 2018 Finance Commission for sympathetic treatment to Jharkhand due to its peculiarities, reasserts its independence with respect to Centre and States Case Laws: GST 2018 (8) TMI 212 Levy of GST - supply of goods or services to SEZ unit or SEZ developer - IGST Act - Whether or not the supply of goods and on-site services to customers in SEZ area to any SEZ unit or SEZ developer is zero rated supply under section 16 of the Integrated Goods & Services Tax Act, 2017? - whether GST is chargeable for the supply of goods or services to SEZ unit or SEZ developer? Held that:- Section 16 of IGST Act deals with “zero rated supply” which includes the supply of goods and services or both to a Special Economic Zone Unit or a Special Economic Zone Developer - Since the Applicant supplies to units and developers of Special Economic Zones only, the provisions of Section 16 of IGST Act will be applicable in this case and the tax liability will be at zero rate under sub section 1(b) of the IGST Act - He may supply without paying tax subject to the provisions under section 16 (3) (a), or he may supply on payment of tax and claim refund subsequently under section 16 (3) (b) of the IGST Act. Ruling:- The Applicant shall be liable to pay tax when supplying to Units and Developers of Special Economic Zones subject to the provisions of Section 16 of the Integrated Goods and Services Act, 2017. 2018 (8) TMI 211 Extension of time period for filing of GST Tran-1 - petitioner has alleged in the petition that despite making several efforts on the last date for filing of the application, the electronic system of the respondent no.2 did not respond, as a result of which the petitioner is likely to suffer loss of the credit that it is entitled to by passage of time - Held that:- The respondents are directed to reopen the portal within two weeks from today. In the event they do not do so, they will entertain the GST TRAN-1 of the petitioner manually and pass orders on it after due verification of the credits as claimed by the petitioner - petition allowed. 2018 (8) TMI 210 Seizure of goods - seized from the business place - seizure order passed under Section 67 of the UP GST Act read with Rule 139 of the U.P. GST Rules - Held that:- Petitioner prays for is granted one month's to file counter affidavit - List this matter on 08.08.2018. 2018 (8) TMI 209 Extension of time period for filing of GST Tran-1 - case of petitioner is that despite making several efforts on the last date for filing of the application, the electronic system of the respondent no.2 did not respond, as a result of which the petitioner is likely to suffer loss of the credit that it is entitled to by passage of time - Held that:- The respondents are directed to reopen the portal within two weeks from today. In the event they do not do so, they will entertain the application of the petitioner manually and pass orders on it after due verification of the credits as claimed by the petitioner - petition allowed. Income Tax 2018 (8) TMI 208 Claim of agricultural income - revision petition - Whether assessee failed to appreciate the evidence available on record by traversing beyond the scope of the records and against the findings given by the various statutory and judicial authorities as also the admissions made in the remand report by the assessing officer? - Held that:- The order passed by the Tribunal is verbatim repetition of the findings of the Assessing Officer in its order dated 29.03.2001, passed under Section 143(3) read with Section 147 of the Act. We find that there is no reference to the remand report dated 25.11.2002, which was called for by the CIT(A) based on which the CIT(A) allowed the appeal. To be noted, the Assessing Officer on report being called for, has made a detailed enquiry, and the Inspector of Income Tax has recorded statements from the landowners verified the Revenue records maintained in the office of the VAO and then submitted his remand report. The Tribunal ought to have made an endeavour to examine as to the effect of the remand report, which was the basis for allowing the appeal filed before the CIT(A). We find that while dismissing the assessee's appeals, the question which was required to be considered is whether the Tribunal is right in disallowing the claim of agricultural income of the assessee, having failed to appreciate the evidence available on record and traversing beyond the scope of the records and findings given by authorities as also the admission made in the remand report by the Assessing Officer himself. Thus, what was required to be considered, was the effect of the findings given by the authorities more particularly, the admission made in the remand report by the Assessing Officer himself. Thus, a subsidiary substantial question of law, which would arise out of the substantial question of law framed is whether the Revenue was entitled to maintain an appeal as against the order of CIT(A), which itself was based upon a remand report 25.11.2002. If the answer to this subsidiary question of law is answered in favour of the assessee, then the appeal filed by the Revenue before the Tribunal has to be not maintainable in the light of the decisions quoted above. Though such a question was not specifically framed, the effect of the findings given by the authorities and more particularly, the admission of the Assessing Officer in the remand report, was required to be considered. Thus, in the absence of consideration of this important jurisdictional issue, we find that the judgment, dated 30.09.2013, suffers from error which is apparent on the face of the judgment. As already noticed, the Tribunal verbatim repeated the order passed by the Assessing Officer, dated 29.03.2001, and ignored the remand report, dated 25.11.2002 and the findings rendered by the CIT(A) based on such remand report. Thus, if such is the situation, the appeal itself would have been incompetent. Hence, this question, which touches upon the jurisdiction of the Tribunal, has not been considered by the Tribunal, we are inclined to review the judgment and remand the matter to the Tribunal for fresh consideration. Review Petitions are allowed 2018 (8) TMI 207 Reopening of assessment - bogus expenditure - Held that:- No doubt, each assessment year is to be seen differently; however, the note from the investigation unit talks of a pattern of expenditure claims over a five-year period. Three of those years were dealt with; the assessee emerged unscathed. Given these circumstances, this is clearly a case where the revenue is attempting to fish from the same stale pond, when it dipped into the TEP as the basis for the investigation, to suddenly discern a pattern of suspect or bogus expenditure. In this case, the trigger for all the reassessment attempts by the revenue was the same TEP, which led to previous attempts to re-open completed assessments. The material on record show that the AO had conducted inquiries at the time of completion of the original assessments. There is nothing to show that the entities to whom payments were made (by the assessee) were fictitious; in fact TDS amounts were apparently deducted. There was no fresh evidence supporting the reassessment. Consequently, there was no tangible, specific material to justify the impugned reassessment notice. For the above reasons, this petition has to succeed. The impugned reassessment notice dated 30.03.2016 and all further proceedings are hereby quashed. The petition is allowed - decided in favour of assessee 2018 (8) TMI 206 Search operation u/s 132 - unexplained cash found - uncompleted assessment proceedings - interest demand - Held that:- In the present case, assessment proceedings are yet to be completed. Further, the search and seizure operation was carried out not only at the business premises of the petitioners but also at the banks in which they had their accounts and in those accounts huge unexplained cash was deposited by the petitioners. The entire unexplained amount found at the business premises as well as bank accounts were seized and a bank draft was got prepared and the amount was deposited in the P.D. Account to meet the final liabilities towards tax of the petitioners after the assessment proceedings get over. Unless the assessment proceedings are completed, the amount could not have been released to the petitioners. There is no question of payment of any interest at this stage when the liabilities of the petitioners are yet to be finalised after assessment proceedings under Section 153-A of the Act get over. This writ petition is not maintainable as it is barred by principle of res judicata neither it has any merit and substance. We, therefore, dismiss this writ petition. 2018 (8) TMI 205 Reopening of assessment - reason to believe - share application moneys were received - Held that:- The material on records show that in all the relevant circumstances in which share application moneys were received by the assessee, the circumstances were explained and all the evidence in support of its contentions was furnished to the AO. In the present case, this Court is of the opinion that apart from that consideration, the reassessment notice is cast in overbroad terms; it merely mentions that pursuant to the search and seizure operations of a third party, some material came to light and that yet other third parties were “Entry Operators”, providing bogus entries in the form of share application credit to the petitioners. The identities of such bogus creditors or Book Entry Operators has not been revealed even though it is known nor are the exact amounts which are reflected in the books of such Entry Operators disclosed as “reasons to believe”. In these circumstances, it is held that the impugned reassessment notices cannot be sustained; they are hereby quashed as are all further consequential proceedings. 2018 (8) TMI 204 Entitlement of the assessee for deduction 80P - adjustments made by the Assessing Officer u/s 143(1)(a) - whether Tribunal was justified in holding that entitlement of the assessee for deduction 80P of the Act is not relevant for charging addition Tax u/s 143(1A)? - Held that:- From the perusal of provisions of Section 143(1A), it is clear that the additional income tax is chargeable if the loss declaration by the assessee is reduced as a result of adjustments. Whether assessee is entitled for reduction under Section 80P or not is not a relevant factor for the purposes of charging additional tax under Section 143(1A) of the Act. When the assessee did not produce any evidence that it had made payment of gratuity and bonus which are statutory dues, the Assessing Officer was justified in making adjustment of such amounts not paid. Having heard learned counsel for the parties and having perused the material on record, we do not find any error in the impugned judgment and order passed by the Income Tax Appellate Tribunal and the same is affirmed by this Court. 2018 (8) TMI 203 Funds received in the form of share premium - AO taxed the amounts so received under Section 56(2)(viib) - section 68 applicability - Held that:- Any premium received by a Company on sale of shares, in excess of its face value; if the Company is not one in which the public has substantial interest, would be treated as income from other sources, as seen from Section 56(2)(viib) of the Act, which we do not think can be controlled by the provisions of Section 68 of the Act. Section 68 on the other hand, as substituted with the provisos, treats any credit in the books of accounts, even by way of allotment of shares; for which no satisfactory explanation is offered, to be liable to income-tax. Clause (viib) of Section 56(2) is triggered at the stage of computation of income itself when the share application money received, from a resident, by a Company, in which the public are not substantially interested; is above the face value. Then the aggregate consideration received for the shares as exceeds the fair market value will be included as income from other sources. When the resident investor is not able to explain the nature and source for the credit seen in the books of accounts of the Company or the explanation offered is not satisfactory then the entire credit would be charged to income tax for that previous year. That is the entire amounts credited in the books of accounts, styled as, for allotment of shares or application money, including the fair market value determined will be charged to tax. However if an explanation is offered and if it is satisfactory in the case of a Company in which the public are not substantially interested, then the charge to tax will only be to that portion exceeding the fair market value determined; which anyway has to occur under Section 56(2)(viib). If Section 68 is applicable, and the proviso is not satisfied, then the entire amounts credited to the books would be treated as income. If satisfactory explanation is offered as to the source, then the premium paid as revealed from the books will be brought to tax as income from other sources. The contentions raised are to be negatived. 2018 (8) TMI 202 Eligible profit for deduction u/s 10A - restriction of eligible profit for deduction u/s 10A on the basis of transfer pricing order - Held that:- As held by the Tribunal in the case of Visual Graphics [2017 (2) TMI 1208 - ITAT CHENNAI] the AO to apply the provisions of 10A(7) r.w.s 80(i)(a)(10) of the Act, has to independently come to the conclusion that the assessee has entered into the transaction with its AE to claim higher deduction. In the case before us the AO has not carried out any such exercise nor has he come to such conclusion independently. It is the DRP who has applied the above provisions, again without carrying out such exercise. As facts and circumstances are similar in this case before us, the grounds against the restriction of eligible profit for deduction u/s 10A on the basis of transfer pricing order are allowed. Exemption u/s 10A – manner of computation – Held that:- If deduction u/s. 40[a][ia] of the Act is not allowed, the same would have been to be added to the profits of the undertaking on which the Assessee would be entitled for deduction u/s. 10A of the Act. This view is fortified by the decision of Bombay High Court in the case of ‘Commissioner of Income Tax v. Gem Plus Jewellery India Ltd.,’ [2010 (6) TMI 65 - BOMBAY HIGH COURT ] 2018 (8) TMI 201 TPA - comparable selection - ALP - substantial question of law or fact - Held that:- The controversy involved herein is no more res integra in view of the decision of this Court in M/S. SOFTBRANDS INDIA P. LTD. [2018 (6) TMI 1327 - KARNATAKA HIGH COURT], wherein it has been observed that unless the finding of the Tribunal is found ex facie perverse, the Appeal u/s. 260-A of the Act, is not maintainable 2018 (8) TMI 200 Assessment u/s 153A - Whether a loss return filed within the time specified in the notice under Section 153A(1)(a) is required to be treated as a return filed in accordance with the provisions of Section 139(3) for the purpose of carrying forward of the loss in terms of Section 72 read with Section 80? - Held that:- A definitive final order cannot be passed without being sure of the date of issuance of the notice under Section 153A(1)(a) of the Act and the time afforded by such notice for the assessee to file the return. For such purpose, the orders impugned passed by the Appellate Tribunal require to be set aside and the matters remitted back to the Tribunal for the Tribunal to ascertain the details as to the date of the notice and the time afforded to file the return and pass an order in the light of the views expressed herein on the questions of law and it is ordered accordingly. The first question of law indicated above is answered thus - For the purpose of carrying forward the loss in terms of Section 72 read with Section 80 of the Act, in a case where search operations have been conducted under Section 132 of the Act, the time to file the return within the meaning of Section 139(3) of the Act has to be regarded as the reasonable time afforded by the consequent notice under Section 153A (1)(a) of the Act. Where Section 153A applies, whether a return filed in response to the notice under Section 153A(1)(a) is required to be treated as a return under Section 139 and that any other return is of no consequence and non est - Held that:- When search operations are conducted under Section 132 of the Act, the obligation of the assessee to file any return remains suspended till such time that a notice is issued for such purpose under Section 153A(1)(a) of the Act. If the return is filed by the assessee within the reasonable time permitted by such notice under Section 153A(1)(a) of the Act, such return would then be deemed to have been filed within the time permitted under Section 139 (1) of the Act for the benefit under Section 139(3) of the Act to be availed of by the assessee. 2018 (8) TMI 199 TPA - comparable selection of M/s. Dolphin Medical Services Pvt. - Held that:- Tribunal's finding that M/s. Dolphin Medical Services Pvt. Ltd., is to be included as a comparable to determine the ALP of the Respondent-Assessee, is a finding of fact. This finding of fact is not shown to be perverse in any manner. Risk adjustment - grievance of the Revenue is that no details were provided by the Respondent to the DRP on account of risk adjustment as claimed by it - Held that:- We find that the impugned order of the Tribunal itself records the fact that the necessary material in support of its claim was given by the Respondent to the DRP on 17th September, 2013 while the order of the DRP was passed on 31st December, 2013. This finding of fact by the Tribunal has not been shown to be incorrect. Locational advantage - TPO and DRP had enhanced the ALP by taking into account the locational advantage of the Respondent while determining the ALP on non-related transactions by comparable entities operating in India - Held that:- The Tribunal's finding is that the comparable selected to determine the ALP were entities operating in India just as the Assessee. Thus, the Tribunal by the impugned order has held that no adjustment of ALP on account of locational advantage is called for. This, as both the comparables as well as and the Respondent, are situated in India. Thus, no locational difference. Consequently, no locational advantage. Appeal admitted on the substantial question of law at (b) - Whether in law and on the facts and in the circumstances of the case, the Tribunal was right in law in holding that the assessee is entitled to get the benefit of section 10B of the Act, on the interest income derived? 2018 (8) TMI 198 Claim under Section 80G - charitable purpose - Held that:- In the present case, there were never a case set up of a donation made to the trust. The claim was made of business expenditure which was later altered to one of a donation to the trust. The purpose of the activity for which the fund is applied does not change with the change of the provision under which the claim for deduction is raised. The fund was applied for the air-conditioning of a town hall which is owned by the Local Authority and bears the name of the founder of the assessee. We do not see any charitable purpose in the application of the funds and we also notice that the trust had no control over the funds and acted merely as an agent of the assessee in carrying out the air-conditioning of the hall, if at all it was so carried out. We find that there is no donation made by the assessee to the charitable institution; which it could have applied to the charitable purposes for which it was established. Hence we reject the claim and affirm the order of the Assessing Officer, setting aside those of the first appellate authority and the Tribunal to that extent. We answer the alternate question raised by us in favour of the revenue and against the assessee. 2018 (8) TMI 197 Suppression of net profit - admission of additional ground - Held that:- This is not a case where the Tribunal has decided a ground which was never raised by the Revenue, a suggestion which is otherwise made by the petitioner but we are unable to accept. The fact that the Revenue moved with great speed need not be conclusive. How long that the arguments last, merely because it was the group of appeals which was listed at serial Nos. 1 to 18 arguments were heard ahead of other appeals, whether the Commissioner's decision was conveyed to the Revenue's representative who was present before the Tribunal telephonically allowing him to proceed to raise the ground without written communication are issues not possible perhaps not necessary for us to finally comment upon. We are unable to find conclusive evidence to hold that the Tribunal entertained a ground which was not raised. The second important conclusion that we have reached is that the Tribunal did act somewhat informally in the process. We are convinced that the assessee was not given an opportunity to oppose this additional ground being raised by the Revenue in these two years and more importantly, oppose the ground on merits. The impugned judgement of the Tribunal dated 05.12.2008 is set aside to the limited extent where the Tribunal has allowed the Revenue's appeals for the assessment years 1998-99 and 2000- 01 on the additional ground of deletion of suppression of net profit by the CIT (Appeals) on the basis of diary called black diary seized during the search. For such purpose Tribunal's findings on this issue are set aside for fresh independent disposal in accordance with law. 2018 (8) TMI 196 Exemption u/s 11 - charitable purpose - Whether promotion of sports and games can be considered to be charitable purpose? - Held that:- The contention which has been raised pursuant to the observations and amendment which is made under Section 12AA of the Income Tax Act and proviso which is impressed by the counsel for the department and Section 2(15) of the Act and proviso to Section 12AA which has been amended w.e.f. 1.4.2009 which has been introduced in the Finance Act w.e.f. 1.4.2012, will not apply in the present case inasmuch as all proceedings are for the financial year 2005-06, 2008-09 2009-10. It is true that in one of the case where it has been made effective from 1.4.2009 therefore, in one of the appeal for the assessment year 2009-10 the same will apply to proviso. While considering the matter, the real purpose of registration is to be seen that the object falls within the definition of Section 12AA and proviso. If there is any breach of any condition/s then they may cancel the registration, however, they have to follow the procedure. The contention that non-communication of changes of purpose will automatically cancel the registration, in our considered opinion, is not a valid argument. However, in view of the specific clause which has been there under Form 10A, we are of the considered opinion that it will be open for the department while making assessment to follow provision of Section 11(5) and Section 13 to disallow the expenses of the income as the case may be, if the same is not income in expenses as per the approved bye-laws but nonetheless cancellation of registration is uncalled for. All the issues are answered in favour of the assessee and against the department. 2018 (8) TMI 195 Seeking registration u/s.12AA and approval under section 80G(5) - Held that:- In the instant case, the assessee is a society had applied for registration under section 12AA of the Act in the prescribed Form 10A on 31.7.2017 seeking registration under the Income Tax Act as well as application in Form 10G was filed on the same date by the assessee society for approval u/s.80G of the Act. A reading of above clause shows that the Memorandum of Association specifically provides that upon dissolution of the society, its assets will be handed over to similar registered society or to Government after clearing up all it’s debts and liabilities. Therefore, in view of above clause in the MOA of the society, in our considered view, the ld CIT(Exemption) was not justified in refusing registration to the assessee society on this ground also. The refusal to grant registration u/s.12AA of the Act to the assessee society is not proper and justified. Similarly, the refusal to grant of approval u/s.80G of the Act is also not justified. Hence, we set aside the order of the CIT(Exemption), Hyderabad and direct him to grant registration u/s.12AA of the Act and approval u/s.80G of the Act to the assessee society. Thus, the grounds of appeal of the assessee are allowed. 2018 (8) TMI 194 Addition u/s 40A(3) - cash payment against purchase of land - assessee has converted the land in the subsequent year - Held that:- The land was shown in the Balance sheet under "Fixed assets" but not shown in the books of accounts as 'stock-in-trade', hence the provisions of Section 40A(3) would not apply - Held that:- The assessee has not claimed the payment of ₹ 1.50 crores as expenditure or capitalized the same in the value of the land. The assessee has submitted copy of the ledger “land at Saroor Nagar”, as per which, assessee has debited the value as per registered document and further development expenditure in that project. It has not charged the cash payment of ₹ 1.50 crores to the said land at Saroor Nagar. This fact was also confirmed by the AO in his submission which was submitted by ld. DR before us. It clearly shows that assessee has not capitalized the above cash payment in fixed assets. Therefore, assessee cannot claim any expenditure or even convert the same as business assets or stock in trade, the cash payment of ₹ 1.50 crores is not part of value of land. Hence, it cannot be a part of future business expenditure. Therefore, the contention of the revenue authorities is not correct to say that assessee has converted the land in the subsequent year amounts to claim of expenditure in the subsequent AY, as the value of ₹ 1.50 crore is not part of land in first place. Hence, the disallowance u/s 40A(3) is accordingly deleted. 2018 (8) TMI 193 Reopening of assessments - Addition on sale of 12 flats - Held that:- The assessee has furnished the assessment order dated 08.1.2008 in the paper book and from the assessment order, there was no noting regarding the verification of the parking fees collected by the assessee and the sale proceeds received for 9 flats and admission of income and the closing stock etc. The Ld.AR also did not establish with tangible evidence that the AO has examined the details and taken a conscious decision. Further, the assessment is reopened within 4 years from the end of relevant assessment year and the case does not fall under the proviso to section 147. Once the case does not fall under the proviso to section 147 the belief of the assessing officer is sufficient with regard to escapement of income. See M/s Rajesh Jhaveri Stock Brokers(2007 (5) TMI 197 - SUPREME COURT). On merits of addition it is established that as on the date of sale, the construction was not complete and there was a time limit for assessee to complete the construction. Since the assessee is following construction completion method, the assessee has admitted the certified value of construction of ₹ 31,40,950/- which works out to 72% of the sale value. The stage of completion of work was certified by the approved Panel Engineer and the AO has not brought on record to establish that the assessee has completed the construction more than the value certified by the engineer. Therefore, we hold that the assessee has correctly admitted the sum of ₹ 31,40,950/- towards the value of construction upto 31.03.2006, no further addition is required. The remaining sale proceeds were already admitted by the assessee in subsequent year in respect of 9 flats. Accordingly, we hold that the assessee has correctly, admitted the sale value in respect of 9 flats and no further addition is required. Therefore, the order of the Ld.CIT(A) is set aside and the addition made by the AO is deleted. The appeal of the assessee on this ground is allowed. 2018 (8) TMI 192 Actual payment u/s 37(1) - expenditure towards premium paid to LIC under ‘Group Gratuity Scheme’ - Held that:- We hold that the actual payment made to Group Gratuity Fund of LIC needs to be allowed as deduction. Accordingly, we uphold the order of the Ld.CIT(A) and dismiss the appeal of the revenue. For the assessment year 2014-15, apart from payment of LIC Group Gratuity, there is one more issue on the addition of provision for standard assets. The assessee has debited an amount of ₹ 37 lakhs towards standard assets. The AO disallowed the same u/s 37(1) since the provision for standard assets is not an allowable deduction. Provision for standard assets is not an allowable deduction and we set a side the order of the Ld.CIT(A) and restore the order of the Ld.AO. The appeal of the revenue is allowed on this ground. 2018 (8) TMI 191 Claim of depreciation to assessee trust - Held that:- As decided in assessee’s own case for AY 2011-12 amount of depreciation debited to the account of charitable institution has to be allowed in order to arrive at the income available for application to the charitable purpose. 2018 (8) TMI 190 Entitled to exemption u/s 11 and also u/s 10(23C)(vi) - assessee had collected huge extra consideration over and above the official fee - receipt of capitation fee - Held that:- The decision relied upon by the learned Counsel for the assessee i.e. the Chief Commissioner of Income Tax vs. St. Peter’s Educational Society reported in (2016 (6) TMI 536 - SUPREME COURT OF INDIA) also confirm the view that the ultimate test is whether on an overall view of the matter in the concerned A.Y, the object is to make profit as opposed to educating persons. In the case of Queen’s Educational Society vs. CIT reported in (2015 (3) TMI 619 - SUPREME COURT), the Hon'ble Supreme Court has followed its decision the case of St. Peters Educational Society (Supra) to hold that the assessee there in is eligible for exemption u/s 11 of the Act. Respectfully following the above decisions, the assessee’s appeals are treated as allowed. 2018 (8) TMI 189 Validity of the additions made u/s 153A - Held that:- All the additions made by the AO in the assessment years 2006-07, 2007-08 and 2008-09 are beyond the scope of assessment u/s 153A, because assessments for these assessment years had attained finality before the date of search and no incriminating material or seized documents were found qua these additions. Accordingly, additions made by the AO are quashed on this ground. 1/5th disallowance of business expenses on adhoc basis - Held that:- The very nature of these expenses debited shows that they have been incurred during the normal course of business and without pointing out any specific defect in the nature of expenses or specifying that such expenses were either for non-business purpose or for personal use, no adhoc disallowance can be made or sustained, especially when entire books of accounts and vouchers have been produced for scrutiny before the AO. Thus, we do not find any infirmity in the order of the Ld. CIT (A) for deleting such an addition and same is affirmed and accordingly, the disallowance of business expenses is dismissed. Admittedly similar reasoning has been given by the AO for similar kind of expenses in the assessment year 2010-11 and 2011-12, therefore, our reasoning given above will apply mutatis mutandis for these two years also Bogus purchase made from M/s. Kiran Furniture - during the course of survey made in the case of M/s Nitin Enterprises was found to be engaged in providing bogus bills and one of its partner has given a statement that assessee was also given the bogus bill and has received cheque from the assessee for the said bills in lieu of cash for the same amount returned back to the assessee - Held that:- The assessee has made the payment to the party through banking channels and simply relying upon the statement of one of the partner that cash has been returned in lieu of cheque cannot be accepted without such a person being subjected to cross examination. Even otherwise also such a statement itself loses its credibility and evidentiary value, when the firm itself has taken a legal action for recovery of same dues from the assessee on the purchases made for which it has issued the bills. Not only that, there has been amicable settlement of dues and payment has been made by the assessee to the said party. In light of these evidences filed before Hon’ble High Court in the suit proceedings, the statement of the partner gets mitigated and no credence can be given to such a settlement. The detailed finding of the CIT (A) on this issue as incorporated above is not only based on correct appreciation of facts but also in law, therefore, the said finding is affirmed and the addition made by the AO on account of bogus purchase is deleted. Addition on account of unexplained purchases made from M/s. Kiran Furniture - Held that:- The assessee has furnished various evidences and documents as enlisted by the CIT (A) to prove the genuineness of the purchases made and simply because, the notices issued by the AO to the said party has not been replied back, it cannot be held that either the said parity has not rendered any services to the assessee or the invoices raised by the said party is fictitious or the identity of the said party cannot be established. Moreover the payments have been made to the said party through cheques on which TDS has been deducted. All these facts ostensibly leads to conclusion that payment has been made to the assessee to the said party for receiving the services at various projects and such a payment cannot be held to be non genuine. Addition deleted Unexplained cash - Held that:- Although whatever cash was found from the possession of the assessee the same was found to be reflected in the books of accounts. The assessee in the course of search itself has categorical stated that the cash in the form of foreign currency belonged to M/s. GL Litmus Events Pvt. Ltd., and without any other material to hold that the foreign currency belong to the assessee AO has held to be undisclosed income of the assessee. Even the Panchnama also shows the joint name of assessee and M/s. G.L. Litmus Events Pvt. Ltd. and how this adverse inference has only been drawn by the assessee is not understood. The copy of confirmation from M/s. G.L. Litmus Events Pvt. Ltd. confirming the entire facts and other catena of documents which have been filed before the AO has neither been considered nor any has been rebutted by the AO. Accordingly, observation and finding of the Ld. CIT (A) based on facts and material on record that the foreign currency does not belong to the assessee but to M/s. G.L. Litmus Events Pvt. Ltd. cannot be disturbed and accordingly the order of CIT(A) affirmed. Additional account of scrap sales and low declaration of income - Held that:- We find it very difficult to appreciate the stand taken by the AO and Ld. CIT (A) to estimate on adhoc basis, the sale of scrap material outside the books of account either by applying 50 % or 20%. More so, when all the invoices and details of services provided and purchases were duly supported by invoice and recorded in the books of accounts; and neither the books nor the trading results including valuation of scrap made has been disturbed. None of the authorities have examined this issue in a proper perspective. Therefore, in the interest of justice we feel that this issue needs to be remanded back to the file of the AO, who shall see; firstly, whether the stocks which are reflected in the books of account are part of stock as on 31st March, 2011 or not and if so, then no addition should be made; secondly, if the stock taken on rent has been returned back then also no addition on account of alleged sale of scrap should be estimated; and lastly, the AO shall examine whether any part of the scrap which has been sold in the subsequent year has been accounted for or not. With this direction this matter is remanded back to the AO, who shall give proper opportunity of hearing to the assessee to substantiate its contention alongwith the documentary evidences. In the result grounds raised by the assessee as well as by the revenue on this score are treated as partly allowed for statistical purpose. Disallowance on account of low declaration of income - only reason for adding the income of ₹ 11,84,424/- by the Revenue was that DDA has informed AO that payments have been made to the assessee at ₹ 90,23,654/-, whereas the assessee has only accounted for ₹ 78,39,230/- - Held that:- Assessee was awarded contract with DDA to provided installation of signage at different sites for Common Wealth Games. The assessee’s contention has been that there were certain objections raised by the DDA and the final quantum of the bill amount that would be passed was not certain till the closing of the financial year 31st March, 2011. Accordingly, the assessee has shown the balance receipt of ₹ 11,84,424/- as receivable. Once the amount was received, the assessee has disclosed it as its income in the next financial year relevant to the assessment year 2012-13, which fact has neither been disputed by the AO nor by CIT (A). Once the amount has been offered to tax in the subsequent year, we do not find any reason to again tax the same amount in this year. Accordingly, we hold that the addition made on account of declaration of income from DDA amounting to ₹ 11,84,424/- under the facts and circumstances of the case cannot be added as income of the assessee as the same has already been offered to tax in the subsequent year. 2018 (8) TMI 154 Addition made on account of accrued interest on loans treated as “Non Performing Assets” - violation of Section 145 - maintainability of appeal - Held that:- In view of Circular No. 3 of 2018 dated 11.07.2018 passed by the Ministry of Finance, Department of Revenue, Central Board Direct Taxes, Government of India regarding low tax effect, this petition is dismissed as withdrawn. 2018 (8) TMI 153 Addition on account of bogus payment for purchasing land - addition being commission paid for giving accommodation entries - Held that:- Special Leave Petition is dismissed. Pending application(s), if any, stands disposed of accordingly. 2018 (8) TMI 152 Addition on account of accrued interest on loans which are classified as "Non-performing Assets" - Held that:- The Special Leave Petition is dismissed leaving the question of law open as the tax effect is low. 2018 (8) TMI 151 Exemption under section 10A - contention of the Revenue that in computing the deduction u/s 10A addition made on account of the disallowance of the provident fund/ESIC payments ought to be ignored - Held that:- The civil appeal is disposed of in terms of the judgment passed in COMMISSIONER OF INCOME TAX, CENTRAL-III VERSUS HCL TECHNOLOGIES LTD. [2018 (5) TMI 357 - SUPREME COURT] Customs 2018 (8) TMI 188 Jurisdiction - power of the Development Commissioner appointed under Section 11 of the Special Economic Zones Act, 2005 to pass an order imposing penalty under Section 11 (2) of the F.T. Act - Penalty - submission of the petitioner being that the alleged violation did not have any concern with or violate the F.T. Act or the SEZ Act - Section 21 of the SEZ Act read with the F.T. Act. Held that:- The self certification/declaration, the procedure for issue of GSP certification for units in the SEZ, was adopted and implemented for providing conducive environment to avoid and curtail loss of time so as to not delay exports on account of compliances and formalities. The procedure was based on faith and trust. It required honesty and probity on the part of the declarants. Act and omissions of the petitioner must be judged on the said parameters. 57. Thus, the impugned order rightly holds that in case of SEZ units, the Development Commissioner did not carry out actual verification exercise and the petitioner had self certified that biodiesel to be exported was eligible for the GSP certification as goods of Indian origin. The petitioner had earned “undue profit”, at the risk and peril of the country‘s reputation. Wrong and fraudulent certification could have affected our credibility and sanctity of GSP certification issued and stamped by Indian authorities. It could have resulted in withdrawal of benefits under the GSP scheme. Consequences and impact were far-reaching and immense - The Appellate Authority has rightly observed that the petitioner cannot wash away its responsibility and failure to furnish correct information and declaration on the origin of goods. Petitioner had made false declaration to procure wrong GSP certification. They were beneficiaries of the wrong declaration, which had jeo-pardised and harmed the country‘s prestige and reputation - Penalty was justified. Petition dismissed - decided against petitioner. 2018 (8) TMI 187 Jurisdiction - power to issue SCN - adjudication of SCN issued to the petitioner by the Commissioner of Customs of various states - N/N. 60 of 2015-cus (NT) dated 04.06.2015 - Held that:- N/N. 60 of 2015-cus (NT) dated 04.06.2015 states that in exercise of the powers conferred by clause (a) of Section 152 of the Customs Act, 1962 (52 of 1962), the Central Government has given directions that the powers of CBEC, under Sections 4 and 5 of the said Act, may be exercised also by the Principal Director General, Directorate General of Revenue Intelligence, New Delhi, for appointing officers of the rank of Commissioner of Customs or Additional Director General of the said Directorate for the purpose of adjudication of cases investigated by that Directorate - the notification does not speak of delegation of powers of CBEC to the Principal Director General of the Directorate General of Intelligence, but it says that such power of the Board under Sections 4 and 5 of the Customs Act, 1962, may be exercised also by the Principal Director General of the Directorate General of Intelligence. Therefore, the assumption of the petitioner is in correct. Admittedly, the Deputy Director of DRI, is an officer, who is higher in rank than the Deputy Commissioner - Deputy Director or Assistant Director of Directorate General of Revenue Intelligence and Directorate General of Central Excise Intelligence are entitled to function as proper officers under Section 28 B and Section 72. This Court is of the considered view that the impugned communication sent by the Deputy Director is in consonance with the notification issued and there is no reason for questioning the notification on the grounds raised by the petitioner - petition dismissed. 2018 (8) TMI 186 Smuggling - import of contraband items - unclaimed goods - though the said goods landed in India, none came forwarded to claim the said goods - investigation revealed that, the goods so seized were consigned to accused no.1 purporting to be under the T.R. facility and as such he was directed to remain present before the Superintendent of Customs , C.I.U., M & P Wing, Bombay with all the relevant papers and documents relating to the consignment goods in his name from Dubai - Held that:- The evidence of the P.W.3 has proved the fact that goods have been removed on 7th February, 1985 and P.W.4 in evidence asserted that these goods were deposited in the Customs Godown on 5th March, 1985. He had also produced the Register on Record. The question, that arises is, with whom the subject goods were lying between 7th February, 1985 to 5th March, 1988. The prosecution has neither answered this issue, nor clarified it by placing on record, evidence of any kind - The prosecution has not explained this anomaly, either in evidence or otherwise. Nobody knows who was in the custody of the subject goods from 7th February, 1985 till 5th March, 1985. There are no reasons to hold that the trial Court has committed any error in appreciating the evidence and recording the order of acquittal against accused nos.1 and 3 - appeal dismissed - decided against appellant. 2018 (8) TMI 185 Classification of goods - Bitumen - Held that:- The two test reports namely, that of the Deputy Chief Chemist and of the Central Revenue Control Laboratory being in conflict with each other, will not suffice for deciding upon the classification. However, the primacy accorded to certain reports of M/s Geochem Laboratories Pvt Ltd as well as that of the National Iranian Oil Refining Company which are neither authenticated nor certified for expertise is improper. It is therefore, strange that a chemical laboratory arrogating to itself the expertise of denying Iran as a source of natural bitumen has been accorded such credence in the adjudication order and with no support to substantiate the contents thereof. Appeal allowed - decided in favor of appellant. 2018 (8) TMI 184 Double benefit of DFIA Scheme availed - N/N. 40/2006-Cus denied - certificate regarding use of goods not produced - Held that:- The identical issue, in the appellant’s own case, has been decided against them by this Tribunal in the case of M/S SAURASHTRA CEMENT LIMITED VERSUS C.C. JAMNAGAR (PREV.) [2018 (6) TMI 1166 - CESTAT AHMEDABAD], where it was held that The Notification prescribes various condition unlike in the Notification 13/1997-Cus. As per the conditions, the importer is duty bound to execute a bond binding himself to use the imported materials in his factory and not only that, he has to submit a Certificate of the jurisdictional Excise Officer regarding end use of the goods - appeal dismissed - decided against appellant. 2018 (8) TMI 183 Valuation of imported goods - Aluminium Waste and Scrap - Rejection of declared value on the basis of a Circular issued by the Directorate General of Valuation being Circular LR No. 14/2005 dated 16.12.2005 - Held that:- In an earlier set of appeals of M/s Sanjivani Non Ferrous Trading Pvt. Ltd. [2017 (3) TMI 359 - CESTAT ALLAHABAD], the Tribunal has considered the identical issue, where it was held that The assessable value has to be arrived at on the basis of the price which is actually paid and in a case the prices is not sole consideration or if the buyers and sellers are related persons then after establishing that the price is not sole consideration the transaction value can be rejected and taking the other evidences into consideration the assessable value can be arrived at - appeal allowed - decided in favor of appellant. PMLA 2018 (8) TMI 182 Offence under PMLA - Attachment orders continue till the final outcome of the criminal complaint which is pending before the Special Court - Held that:- Matter was listed from time to time in the connected appeals though the appellants are different in common order. The suggestion was made on the last few dates that the attachment order already passed in respect of Room No. 39, 3rd Floor, Ambulkar Sadan, Gokhale Road, South Dadar, Mumbai-400028 may continue till the final outcome of the criminal complaint which is pending before the Special Court. The counsel for the respondent has no objection. The counsel for the appellant states that this Order may be passed without prejudice to the right and contention of the appellant. The counsel for the appellant agrees to deposit ₹ 181/- per month with the respondent till the final outcome of the matter before the Special Court. The said suggestion is agreeable to the learned counsel for the respondent. Appeal is disposed of. In case the proceedings pending before the Special Court are decided in favour of the appellant, who would be entitled to file appropriate application as well as refund of the rental amount which is being deposited as user and occupation charges as well as release of flat in question. Service Tax 2018 (8) TMI 179 Cenvat credit while availing benefit of abatement - Benefit of N/N. 1/2006-ST dated 01.03.2006 - Commercial or industrial construction services - The case of the department is that since the appellant in respect of some the contracts availed cenvat credit and discharged the service tax on 100% gross value of the service, they cannot opt for N/N. 1/2006-ST, for remaining contract. Held that:- From the Notification, it is clear that the service of commercial or industrial construction is exempted subject to condition given in second proviso of Notification particularly Clause (i) - On plain reading of the said provision it is clear that the Notification is not applicable in case where the cenvat credit in respect of inputs or capital goods or input services used for providing such taxable service has been taken. In the present case the appellant in respect of the service on which N/N. 1/2006-ST availed, admittedly not availed cenvat credit in respect of input or capital goods or input services used in providing such taxable services. Therefore, the condition of the Notification was complied with, merely in some of the contract the appellant had availed the cenvat credit, and the same has no effect on the service where the exemption Notification No. 1/2006-ST was availed. The issue has been dealt in the case of Bharat Heavy Electrical Ltd Vs. CCE [2012 (4) TMI 197 - CESTAT, MUMBAI], where it was held that There is no stipulation in the notification that the option to avail/non-avail CENVAT credit has to be exercised uniformly in respect of all the contracts executed by the assessee. It is for the assessee to choose which formulation he wants to follow in a given contract. Benefit of notification cannot be denied - appeal allowed - decided in favor of appellant. 2018 (8) TMI 178 Extended period of limitation - Composite service or not - contract of C&F cum packaging agent - demand of service tax on reimbursement of expenses - Held that:- Though there is a single agreement but it embodies separate contract for each kind of services that being provided and separate compensation for those services. In view of above, there is no vivisection attempted by the Revenue of composite service as there is no single composite service. The appellant has separately billed for each of these separate services. In view of this the Circular CBEC No. 87/97/service Tax dated 14.07.1997 and No. 186/5/20015 dated 05.10.2015 both relating to single composite service are not relevant - In the instance case the amounts recovered under independent separate clause of the agreement of the rate schedule constitute independent and separate services thus on merits the demand is sustained. Extended period of Limitation - Held that:- SCN was issued to the appellant on 22.11.2006 on the basis’s of inquire initiated by summons. On the basis of same inquire initiated the appellant response in the said Show Cause Notice dated 22.11.2006 and impugned notice dated 05.04.2007 is one on the same. The argument under consideration in both notices was also in the same, under these circumstance invocation of the extend period of limitation cannot be sustain. The penalty under Section 78 is set aside, the penalty under Section 76 is revised to the amount of duty leviable for the period within limitation. Appeal allowed in part. 2018 (8) TMI 177 CENVAT Credit - duty paying invoices - denial on the ground that invoices/duty paying documents were not produced in the name of branch office service provider was unregistered etc. CENVAT Credit - Advertising Services - Consulting Engineer services - Business Auxiliary services - Held that:- Appellant had taken a consistent stand that they have no other place of manufacturing other than the place mentioned, no credit is availed at the branch office though received the services, the payment to such service providers are made from the factory premises of the appellants. Since the payments were from Centralized account, being factory, CENVAT credit should not be denied - credit allowed. CENVAT Credit - credit is denied mainly on the ground that appellant did not produce relevant documents - Held that:- If appellant is able to produce some documents to show the service tax liability was discharged by the service providers, and then the lower authorities should examined the same - matter on remand. CENVAT Credit - Travel Agency services - Business Auxiliary services - Chartered Accountant services - Maintenance & Repair services - Technical Testing services - Held that:- The First Appellate Authority has correctly upheld the claim of the assessee as eligible to avail CENVAT credit and has appreciated the facts correctly in as much he has allowed the CENVAT credit - the order of the First Appellate Authority cannot be faulted - credit allowed. Appeal disposed off. 2018 (8) TMI 176 Maintenance and repair services - Point of Taxation Rules - payment of tax with Interest made on being pointed out - Invocation of extended period of limitation - penalty - Held that:- Admittedly, appellant company had expressed its ignorance about change of procedure concerning Point of Taxation Rules, with effect from 01.04.2011 and made delayed payment of service tax upon its receipt and not on the basis of dates on which invoices were raised by it - because of long practice prevailing since introduction of service tax, it was just carrying forward the process and there was no ill intention that can be attributed to evade tax since all the tax liabilities were addressed with due payment of interest after the same being identified by way of audit. The explanation 2 has been inserted to sub-rule 3 of Rule 73 with effect from 08.05.2010 and sub-rule 4 has all along been existing since implementation of Finance Act, 1994. Therefore, there is no need to venture into such debate that explanation 2 providing non-imposition of penalty under any of the provisions of Act and Rule on fulfilment of requirement of sub-rule(3) would have application to subrule 4 since sub-rule 4 starts with an non-obstinate clause nothing contained in sub-rule 3 shall apply to a case where service tax has not been levied or paid or short levied or short paid or erroneously refunded by reason of those five grounds mentioned above under proviso to subrule (1) of Rule 73. In view of the fact that parameters of proviso to Section 73 and ingredients constituting suppression of fact by the appellant has not been made out and the same had not been established by the respondent department before the authorities adjudicating the matter, it can safely be concluded that Section 4 would have no application to the case of the appellant attracting penalty, in which case explanation 2 to sub-section (3) of Section 73 will have its effect - appeal allowed - decided in favor of appellant. 2018 (8) TMI 175 Supply of manpower and agency service - partial reverse charge mechanism - Non-payment of 75% of service tax applicable on invoice value - payment of 100% taxable charges on services were individually collected by the service providers and they have deposited the same in the department as an agent of appellant. - N/N. 30/2012-ST dated 20.06.2012 read with Section 68(2) of Finance Act, 1994 and Rule 6 of Service tax Rules - Held that:- In the said Notification, w.e.f. 01.07.2012 in case of supply of manpower for any purpose or service in exemption of work contract by an individual, HUF or partnership firm whether registered or not including association of persons are required to pay 25% of service tax and the service receiver is required to pay 75% of the said tax. Having regard to the fact that such payment of service tax in the proportion of 75:25 is applicable in respect of specified service providers and there is nothing available on record to justify that the taxability of the appellant has been created by availing services from those category of service providers, there is no point in placing certain manpower service provided by the service provider whose firm names are referred in the audit report in those categories without any basis - raising of bills/ invoices and mentioning of percentage of tax payable by the service provider and service recipient, by the service provider itself would form the basis of identification of service providers, if they fall under those specified categories or under threshold limit in the organised sector and such a basis is found absent in the entire proceeding initiated against the appellant. Appeal allowed - decided in favor of appellant. 2018 (8) TMI 174 Demand of Differential Duty - difference of amounts reflected in the ST3 returns and the ledger accounts - allegation is based upon the investigation during the course of verification of accounts and also on the ground there were two sets of invoices raised - Held that:- During the relevant period in question, tax liability has to be discharged on the receipt basis and demand being hit by limitation as same set of allegations, levelled in earlier show cause notice, the impugned order is correct, legal and does not require any interference - Appeal dismissed. 2018 (8) TMI 173 Classification of services - Services of loading and transportation/movement of coal in the mining area - demand for the period upto 30/06/2012 when the service tax was levied on the basis of specified notified activities - demand for the period w.e.f. 01/07/2012, when the levy of service tax has been changed to a negative list basis. Demand for the period upto 30/06/2012 - activity of transportation of coal from the coal face to the railway siding - whether the services would be classifiable under the category of mining service or under transportation of goods by road service? - Held that:- The Apex court in the case of Singh Transporters [2017 (7) TMI 494 - SUPREME COURT] has decided in identical circumstances that the activity cannot be charged under mining service but more appropriately classifiable under transportation of goods by road service - the demand of service tax for the period upto 31/06/2012 set aside. Demand for the period on or after 01/07/2012 - bundled services or not? - the case of Revenue is that the loading of coal on tippers on the coal face as well as transportation thereof upto the railway siding is to be considered as a bundled activity, whose essential character is mining - Held that:- Even though the activities of transportation of coal has taken place within the mining area, the Apex court in the Singh Transporters case has taken the view that such activity will be classifiable only under GTA and not under mining. In these circumstances, taking a different view for the period w.e.f. 01/07/2012 is not warranted - Even for the period w.e.f. 01/07/2012, the activity of transportation of coal from the coal face to the railway siding will continue to enjoy the benefit available to goods transport agency and cannot be bundled into a single service under Section 66F alongwith lifting of coal at the coal face into the activity of mining. Appeal allowed - decided in favor of appellant. 2018 (8) TMI 172 Refund of accumulated Cenvat credit - Export of output services - Rule 5 of the CCR read with the relevant N/N. 27/2012-CE(NT) dated 18.6.2012 - denial of refund on the ground that the documentary evidence for export of services has not been satisfactorily submitted - Held that:- Identical issue decided in the case of MOBILE IRON INDIA SOFTWARE PVT. LTD, HYDERABAD VERSUS THE COMMISSIONER CCE & ST, HYDERABAD-IV [2017 (4) TMI 228 - CESTAT HYDERABAD], where the grounds for rejection of refund was non-production of Softex returns from STPI authorities. The Tribunal has concluded that the insistence to furnish Softex returns from STP authorities is not as per the law laid down in the relevant field. In the present case also, the appellant has claimed to have exported Information Technology Software Service. The fact of export of such software and the receipt of the foreign exchange therefor is sufficiently evidenced from the invoices, the FIRCs and the Chartered Accountant’s certificate certifying the total turnover - rejection of refund not justified. Appeal allowed - decided in favor of appellant. 2018 (8) TMI 171 Rectification of Mistake - appellant had made arguments on the ground of limitation also, the said argument appears to have been not considered - Held that:- The Tribunal had considered all the arguments advanced by both sides before passing the final order. It appears that the Tribunal sustained the impugned order passed by the lower Authority in toto and dismissed the appeals. It is also seen that the Final Order is not passed in limini or in any summary fashion. Detailed reasons have been given in the Final Order for each and every conclusion. In the name of ROM review of the appeal is not permissible. ROM application dismissed. 2018 (8) TMI 155 Cargo handing service - Movement of coal from mine surface to tip head within the mine area - Held that:- There is no merit in the appeal - Admission is refused and the civil appeal is, accordingly, dismissed. 2018 (8) TMI 149 Classification of services - Cargo Handling Services - Held that:- There is no merit in the appeal - Admission is refused and the civil appeal is, accordingly, dismissed. 2018 (8) TMI 147 Condonation of delay in filing appeal before the Commissioner (Appeals) - condonable period of limitation - Held that:- There is no merit in the appeal - The Special Leave Petition is dismissed. 2018 (8) TMI 146 Valuation - inclusion of certain materials used in the execution of the contract of service - Held that:- There is no merit in the appeal - Admission is refused and the civil appeal is, accordingly, dismissed. 2018 (8) TMI 143 Valuation - commercial construction services - value of free supply of the goods to appellant by their customers for rendering output services - Held that:- There is no merit in the appeal - SLP dismissed. 2018 (8) TMI 142 Service of repairing of footwear - sale or service? - Held that:- Appeal admitted - There shall be stay of the operation of the impugned judgment. Central Excise 2018 (8) TMI 170 Waiver of Interest - Recovery of Excise Duty - BIFR Scheme - the excise duty had been collected by the petitioner from its customers but not paid to Government - the petitioner company was declared as a Sick Industry on 16.11.1994 as contemplated under Section 18 of SICA. Held that:- Admittedly, the petitioner collected excise duty from their customers during the course of their business. The fact that the petitioner collected excise duty is not denied. At the same time, the petitioner did not remit it to the credit of Excise Department. Therefore, the presumption would be that the petitioner had retained the duty collected from their customers and utilised it for their own purpose - the long drawn process of rehabilitation to rehabilitate the petitioner company, however, should not be at the cost of the creditors who were waiting for a long time for settlement of their legitimate dues or such rehabilitation process should not frustrate the creditors or make them fall within the scope and ambit of sick industry. The object with which SICA was enacted is to put the rehabilitation process, to rehabilitate a sick industrial company in the fast track mode to expeditiously settle the creditors. It would be imperative to revive and rehabilitate the potentially viable sick industrial companies as quickly as possible. The process for rehabilitation must not be time consuming as it would prejudice the creditors of the company. A scheme for rehabilitation has to be drawn and genuine attempts have to be made to rehabilitate the sick industry within a reasonable time and it should not be at the cost of the creditors of the company and to make them to drive from pillar to post to get their legitimate dues recovered from the sick industry - In the present case, admittedly, the petitioner company was declared as a sick industry. Now, more than two decades have lapsed from the date on which the petitioner company was declared as a sick industry. After declaring the petitioner company as a sick industry, several rehabilitative measures were drawn, schemes were put in place and creditors have held consultative process to explore the possibility of rehabilitation so as to get their dues settled at the earliest. However, several attempts made to rehabilitate the petitioner company has failed - the order passed by the first respondent, which is impugned in this writ petition, need not be interfered with. Under the garb of rehabilitating the petitioner company, the second respondent cannot be deprived of their statutory dues which are pending for a very long time. The decision of Division Bench of the Andhra Pradesh High Court in the case of Andhra Cements Limited vs. Commissioner of C.Excise & S.T., Guntur, [2017 (4) TMI 694 - ANDHRA PRADESH HIGH COURT] squarely applies to the facts of present case, where it was held that A person who gained advantage by an interim order of the Court cannot, subsequently, turn around and seek umbrage under Section 32 of the Sick Industrial Companies (Special Provisions) Act, 1985. Petition dismissed - decided against petitioner. 2018 (8) TMI 169 Maintainability of appeal - Challenge to Rectification Order - Held that:- So far as the appeals where the impugned order and the rectification order is challenged, we made it clear that appeals will be heard only for the original order and for rectification order, the appellant may move a writ petition within a period of two weeks. In this appeal order passed in rectification application is under challenge - it is held that against such order, writ petition is to be preferred by the appellant. Appeal not maintainable and is dismissed. 2018 (8) TMI 168 Interpretation of Statute - removal of goods - place of removal - Held that:- The tribunal has not committed any error in not considering the provisions of Section 4 of the Central Excise Act, 1944, wherein the term “place of removal” is defined as a factory or any other place or premises of production or manufacture of excisable goods - Appeal dismissed - decided against Revenue. 2018 (8) TMI 167 Clandestine manufacture and removal - MS ingots - suppression of production - third party evidences - It is alleged that demand upon appellant has been confirmed after scrutinising the documents of M/s. Monu Steel, but without any cogent corroborative evidence in this respect - Held that:- From the initial demand of ₹ 13,40,77,925/- the major part thereof i.e. ₹ 11,94,97,832/- has already been dropped, relying upon the decision of Hon’ble Apex Court in the case of RA Castings Pvt. Ltd [2011 (1) TMI 1302 - SUPREME COURT OF INDIA] - the order under challenge is upheld. Penalty of ₹ 10,000/- - Held that:- Appellant herein is merely a consignment agent that too for providing the raw material to the manufacturer i.e. M/s Steel Abrasive Industries Ltd - The allegations of any clandestine removal of final products by M/s Steel Abrasive Industries Ltd. are opined to have no bearing upon the appellant unless and until there is a corroborative cogent evidence to support the allegation of providing the raw-material without discharging the liability - the same is missing on the record - penalty not warranted, Appeal allowed - decided in favor of appellant. 2018 (8) TMI 166 Imposition of personal penalties - clandestine removal of goods - it was contended on behalf of appellant that there was no evidence except in the form of un-related hand written loose papers and computer printouts, the said papers were not at all resumed from the appellant’s factory and the same has been stated in Para 36C(8) of grounds of appeal - also, it was contended that Revenue did not submit any evidence to prove the authenticity of said loose papers and also failed to trace and examine the author of said hand written loose papers. Held that:- The contentions of learned counsel for the manufacturer-appellant and appellants other than Revenue are sustainable in law - personal penalties imposed are set aside - appeal allowed - decided in favor of appellant. 2018 (8) TMI 165 Clandestine removal - raw-material as well as the finished goods - demand based on third party evidence - Held that:- There is a plethora of judgments to hold that to stand upon the charges as that of clandestine removal, there has to be some clinching evidence and the demand cannot be confirmed based on presumptions and assumptions - The Hon’ble High Court of Allahabad in the case of Continental Cement Co. Vs. Union of India [2014 (9) TMI 243 - ALLAHABAD HIGH COURT] has held that the charge of clandestine removal is a serious charge, which is required to be proved by the Revenue by tangible and the sufficient evidence. It was clarified by the Hon’ble that mere statements of buyers that too based on memories were not sufficient without support of any documentary evidence. The entire case of the Revenue is based upon the records recovered from M/s Monu Steels. Even in these records, the appellant’s name has not been spelt correctly and it is based upon the statement of the representative of M/s Monu Steels that the Revenue entertained an assumption about it to refer to the appellant’s clearances - the Revenue has not made any enquiries from the buyer’s Steels and has solely relied upon the entries made in the record of M/s Monu Steels - Any demand and the proportionate penalty on the Director of the manufacturer is not sustainable. Demand and imposition of penalty qua M/s Kailash Traders, the supplier of sponge iron (the raw material) to the manufacturer - Held that:- Once the demand is not sustainable against the manufacturer, it does not lie against the supplier of raw material especially for want of any evidence corroborating the allegations - demand set aside. Penalty on Mr. Sunil and Mr. Ashok - scope of SCN - Held that:- The facts as brought to the notice i.e Mr. Sunil is not the noticee of impugned SCN and that Mr. Ashok is not the Director of appellant, are perused as correct - Since it is the settled law that the adjudicating authority cannot be go beyond the Show Cause Notice, the order imposing penalty upon him is held to be a definite error in the order - penalties set aside. Appeal allowed - decided in favor of appellant. 2018 (8) TMI 164 Valuation - inclusion of VAT in assessable value - Revenue was of the view that VAT liability discharged by utilising the investment subsidy granted in Form 37B cannot be considered as VAT actually paid, for the purpose of Section 4 of the Central Excise Act, 1944 - Held that:- The identical issue has come up before the Tribunal in the case of Shree Cements Ltd. V/s CCE [2018 (1) TMI 915 - CESTAT NEW DELHI], where it was held that there is no justification for inclusion in the assessable value, the VAT amounts paid by the assessee using VAT 37B Challans - appeal allowed - decided in favor of appellant. 2018 (8) TMI 163 Confiscation of goods - excesses of raw materials, semi-finished and finished goods found in the premises of appellant - appellant contention is that for raising the demand or for proposing confiscation of goods found in the trading premises which were procured by trader appellant on lawful invoices, the burden was on revenue to prove that they were cleared without payment of Central Excise duty and that such burden was not discharged by the revenue - it was also contended by appellant that these were not contravening goods - Held that:- The goods found in the trading premises were beyond the jurisdiction of Central Excise Officers - also, the contentions raised by learned Counsel for appellant are sustainable in law - appeal allowed - decided in favor of appellant. 2018 (8) TMI 162 Method of Valuation - job-work - it appeared to Revenue that the transaction is not at arms length and accordingly, instead of valuation under Section 4(1)(a) of the Act, the valuation is to be done under Section 4(1)(b) of the Act read with Rule 10 A of the Central Excise Valuation (Determination of Price of Excisable Goods) Rules, 2000 - Whether the valuation of wall putty manufactured and cleared by the appellant, M/s. Miraj Drymix Pvt. Ltd., has been rightly done for the purpose of levy of duty? - whether the extended period of limitation has been rightly invoked? - Penalty u/r 26 of CER. Held that:- Under the provisions of Rule 10A with Explanation, the condition precedent, i.e supply of raw material by the principal to the other manufacturer, job worker is not satisfied in the facts of the present case - the show cause notice is misconceived and the provisions of Rule 10 A of the Valuation Rules 2000 do not attract in the facts and circumstances of the present case. The facts herein are squarely covered by the Precedential rulings of this Tribunal in the case of CCE vs Innocorp Ltd. [2013 (9) TMI 382 - CESTAT BANGALORE], where it was held that the respondents in these appeals were not manufacturing the subject goods as job workers on behalf of TUPPERWARE. Needless to say, therefore, that Rule 10A was not applicable to the assessment of the subject goods Demand set aside - penalties also not warranted - appeal allowed - decided in favor of appellant. 2018 (8) TMI 161 Penalty u/r 26 of CER - Clandestine removal - no confiscation order - case of appellant is that in the absence of any order of confiscation of goods, the provisions of Rule 26 cannot be invoked - Held that:- The said Rule can be invoked when a person deals with the excisable goods in the manner as mentioned in the said Rules and has reasons to believe that the goods are liable to confiscation - As such the only criteria for invocation of said rule is the belief/knowledge of the person as regard the liability of the goods to confiscation. There is no requirement in the said rule 26 as regards the proposal in the Show Cause Notice to confiscate the goods or order of the Adjudicating Authority for confiscation. Admittedly in the present case Shri Suraj Prakash has dealt with the goods in a manner which has made the goods liable to confiscation - In a situation where the clandestinely removed goods are no longer available, there can be no proposal to confiscate the same or no order confiscating the same. It does not mean that the person, who is otherwise liable to penalty, would escape the same on the sole ground that he has been successful in the past to clandestinely remove the goods without any interception by the Revenue Authorities. Penalty upheld - appeal dismissed - decided against appellant. 2018 (8) TMI 160 Reversal of CENVAT Credit - emergence of Bio-manure arising as a by product - common inputs and input services - Rule 6(3)(1) of Cenvat Credit Rules, 2004 - Held that:- The Hon’ble Supreme Court in the case of Union of India vs. D.S.C.L Sugar Ltd. [2015 (10) TMI 566 - SUPREME COURT] has held that bagasse being an agricultural waste or residue, there could be no manufacturing activity - Similarly bio manure is nothing but a byproduct which necessarily arises during the course of manufacture of the goods and it cannot be said that the same was a manufactured product. If the same was not manufactured, the same cannot be held to be excisable, in which case the amendment carried out would not apply. Revenue has itself treated the bio manure as a byproduct which arises during the course of manufacture of sugar and molasses. If that be so the provisions of Rule 6(3) would not apply. Appeal allowed - decided in favor of appellant. 2018 (8) TMI 159 Service of Order - Remission of duty - denial on the ground that appeals having been filed beyond the time limit prescribed under law - Held that:- As the impugned order was sent by the Deputy Commissioner to their earlier address in spite of change of address having been brought to the notice of the Revenue and in the absence of the disclosure in the report of the Deputy Commissioner about the address at which the impugned order was affixed, the impugned orders, dismissing the appeals on the point of time bar are required to be set aside and matter needs to be remanded for verification of the address at which the impugned orders were affixed by the Revenue - appeal allowed by way of remand. 2018 (8) TMI 158 Exemption on tractors cleared on concessional rate of duty - N/N. 64/95 dated 16.3.1995 - Department was of the view that the said goods are not eligible for exemption - Held that:- The tractors are used as part and parcel of their launch vehicle project for transporting rocket fuel etc. The launch paid from where national prestigious launches are taking place. That these are in the form of technical equipment for their launch vehicles - the certificate has been given certifying the description and quantity of each type of goods cleared availing the exemption. So also the intended use of the goods for the said project is also certified. Even though the goods cleared may be tractors, the same have been put to use by SHAR for the purpose of launching projects. The said item therefore becomes covered under the notification - denial of exemption not justified - appeal allowed - decided in favor of appellant. CST, VAT & Sales Tax 2018 (8) TMI 157 Revision of Assessment - TNVAT Act - petitioner is of an opinion that for each assessment year, separate proceedings are to be issued by the competent authority, contrarily, a common order has been passed by the competent authority namely, the Assistant Commissioner(ST) in respect of six assessment years - Held that:- This Court is of an opinion that passing of separate orders in respect of each assessment year may be a mere technical objection. However, it may be convenient for the writ petitioner to prefer an appeal, if separate orders are passed. Therefore, it is preferable that the authorities competent shall pass separate orders in respect of each assessment year, so that the aggrieved person can prefer an appeal for each assessment year without any delay. This Court is of an opinion that the writ petitioner has to make such an application seeking personal hearing and in the event of submitting such an application, the authorities competent are bound to provide an opportunity of personal hearing for submitting the defence or otherwise - this Court is of an opinion that it is a fit case for remittance. Matter remitted - Petition allowed. 2018 (8) TMI 150 Rejection of Stay application pre-deposit of 25% already made - Held that:- There is no merit in the present Special Leave Petition. The Special Leave Petition is accordingly dismissed. 2018 (8) TMI 148 Stay of collection of disputed tax - petitioner has already paid 12.5% of the disputed tax while filing the first appeal - Held that:- There is no merit in the appeal - SLP dismissed. 2018 (8) TMI 145 Taxability of flavoured milk - classification of the product - Held that:- There is no merit in the appeal - SLP dismissed. 2018 (8) TMI 144 Recovery of dues - registration of security Interest - priority of debts - Held that:- There is no merit in the appeal - The Special Leave Petition is dismissed. 2018 (8) TMI 140 Classification of goods sold - rate of tax - Electrically Operated Anti-mosquito devices & repellents, Electrically Operated Anti-Mosquito Mat, Anti-Mosquito Coil, Rat Kill, “Harpic”, “Lizol”, “Dettol” Antiseptic - Held that:- There are no legal and valid ground for interference - The Special Leave Petition is dismissed. Wealth tax 2018 (8) TMI 156 Properties/assets chargeable to tax as claimed under the WT Act - Understanding of the AO to bring certain transaction within the purview of the WT Act - notice u/s 17 issued to the assessee reopening the wealth tax assessment - Held that:- SLP dismissed. 2018 (8) TMI 141 Royal Buggy - art work - whether the Royal Buggy in question was not exempted under section 5 (1) (xii) of the Wealth Tax Act, 1957, because, it was covered under the first proviso to clause (viii) of sub-section (1) of Section 5 of the said Act? - Held that:- SLP dismissed 2018 (8) TMI 139 Royal Buggy - art work - whether the Royal Buggy in question was not exempted under section 5 (1) (xii) of the Wealth Tax Act, 1957, because, it was covered under the first proviso to clause (viii) of sub-section (1) of Section 5 of the said Act? - Held that:- SLP dismissed. Indian Laws 2018 (8) TMI 181 Omission to issue the notice under Section 34(5) of the Arbitration Act, 1996, as amended by the Act 3 of 2016 - Held that:- The substantive right of a party to challenge an arbitral award is provided by sub-sections (2) and (2A) of Section 34 of the Act stipulating the grounds on which an arbitral award can be set aside by the Court. Sub-sections (3) of the said Section 34 of the Act lays down the statutory period of limitation within which an application for setting aside of an arbitral award has to be filed before the Court - Although, the purpose and intention of incorporation of the provisions contained in sub-sections (4) and (5) of Section 34 of the Act is expeditious disposal of the application for setting aside of the arbitral award, the said provisions being procedural in nature cannot be construed as mandatory. If the provisions of sub-sections (5) and (6) of the Act is held to be mandatory as contended by the respondent, the same would defeat the substantive right of party to file an application for setting aside of the arbitral award under sub-sections (2) and (2A) of the said section within the stipulated time under sub-section (3) - the provisions contained in sub-sections (5) and (6) of Section 34 of the Act are procedural and not mandatory. Applications allowed. 2018 (8) TMI 180 Contravention of Competition Act - direction to Opposite Parties to cease and desist from indulging in such activity - contravention of Section 3(3)(a) & (b) of the Competition Act, 2002 - alleged price increase - Held that:- The Commission not only looked into ‘Sate-wise Market’ but also ‘Region-wise Market’ and range of percentage change in prices between 2007-2011. The Commission has noticed the Range of Percentage change of different years for the months of October over September (2007-2011) for ‘Central, Northern and Eastern States’. The Commission also highlighting the unprecedented trend for the percentage increase in the prices in all the five regions namely- Central Region, Northern Region, Eastern Region, Western Region and Southern Region - It is clear that the Commission while dealing with the market dealt with the ‘relevant market’ i.e. all regional markets of Cement, which are the relevant geographical market i.e. relevant product market of Cement. Penalty - Held that:- The Commission has imposed mere minimum penalty, no interference is called for against the same. Appeal dismissed - decided against appellant.
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