TMI Tax Updates - e-Newsletter
September 2, 2023

Case Laws in this Newsletter:

GST Income Tax Customs Service Tax Central Excise CST, VAT & Sales Tax

Articles

1. What is Corporate Identification Number (CIN)?

   By: Ishita Ramani

2. GLOBAL MINIMUM TAX SERIES – PART 19 Stateless Entities under GloBE Rules

   By: Amit Jalan

3. INPUT TAX CREDIT AND THE PERCEIVED DEPENDENCE ON THE SUPPLIER TO AVAIL THE BENEFIT OF SUCH CREDIT IN TERMS OF SECTION 16(2)(c) OF THE CGST ACT

   By: Rupesh Sharma

4. Pre-deposit made through E-credit ledger is valid under GST

   By: Bimal jain

5. Gaming laptops are “Automatic data Processing Machines” and not “Video Game Console”

   By: Bimal jain

News

1. ₹1,59,069 crore gross GST revenue collected during August 2023; records 11% Year-on-Year growth

2. Introducing Electronic Credit Reversal and Reclaimed statement

3. Joint outcome statement: UK-India round twelve of FTA negotiations

4. More than 6.62 crore subscribers under National Pension System (NPS) and Atal Pension Yojana (APY)

5. At 7.8% year on year, India’s growth rate towers above the growth rate in several other leading economies, says Chief Economic Adviser

6. Monthly Review of Accounts of Union Government of India upto the month of July, 2023 for the Financial Year 2023-24

Notifications

Customs

1. 51/2023 - dated 31-8-2023 - Cus

Exemption to LPG, Liquified Propane and Liquified Butane from levy of AIDC - Amendment to Notif. 11/2021-Customs, dated the 1st February, 2021.

2. 63/2023 - dated 31-8-2023 - Cus (NT)

Fixation of Tariff Value of Edible Oils, Brass Scrap, Areca Nut, Gold and Silver

DGFT

3. 30/2023 - dated 30-8-2023 - FTP

Export of Non-Basmati White Rice (under HS code 1006 30 90) to Bhutan, Mauritius and Singapore

GST - States

4. G.O.Ms.No.400 - dated 21-8-2023 - Andhra Pradesh SGST

The Andhra Pradesh Goods and Services Tax Act, 2017- To notify special procedure to be followed by the electronic commerce operators in respect of supplies of goods through them by unregistered persons

5. G.O.Ms.No.399 - dated 21-8-2023 - Andhra Pradesh SGST

The Andhra Pradesh Goods and Services Tax Act, 2017- To notify special procedure to be followed by the electronic commerce operators in respect of supplies of goods through them by composition taxpayers

6. G.O.Ms.No.398 - dated 21-8-2023 - Andhra Pradesh SGST

The Andhra Pradesh Goods and Services Tax Act, 2017 - To notify the provisions of sections 2 to 24 (except sections 5 and 24) of the Andhra Pradesh Goods and Services Tax (Amendment) Ordinance No.10 of 2023), dated 31St July, 2023

7. G.O.Ms.No.386 - dated 7-8-2023 - Andhra Pradesh SGST

The Andhra Pradesh Goods and Services Tax Act, 2017 -To notify "Account Aggregator" as the systems with which information may be shared by the common portal under section 158A of the APGST Act, 2017

Income Tax

8. 73/2023 - dated 30-8-2023 - IT

Rule 134 under Income tax rules - Application under sub-section (20) of section 155 regarding credit of tax deduction at source inserted - Income-tax (Twentieth Amendment) Rules, 2023

Circulars / Instructions / Orders

Income Tax

1. Instruction No. 1 of 2023 - dated 23-8-2023

Implementation of the judgment of the Hon’ble Supreme Court in the case of Pr. CIT (Central-3) v/s Abhisar Buildwell Pvt. Ltd. (Civil Appeal No. 6580 of 2021)-Instruction

DGFT

2. Trade Notice No. 25/2023-24 - dated 1-9-2023

Monthly workshops on Cross-border E-Commerce

3. Policy Circular No. 04/2023-24 - dated 31-8-2023

Safeguard Quantitative Restrictions (QR) imposed on import of Isopropyl Alcohol (IPA) — Clarification regarding applicability of QR on imports by SEZ units wrt Notification No. 64/2015-20 dated 31.03.2023

4. 30/2023 - dated 31-8-2023

Revised SION's for the leather, leather products and footwear

Highlights / Catch Notes

GST

• 2022 Amendment Rules: New Requirement for Comparing Values in Unutilised ITC Refunds, Applies Prospectively, Not Retrospective.

  Case-Laws - HC : Refund of unutilised balance of Input Tax Credit (ITC) - Scope of amendment to rules - The 2022 Amendment Rules inserts a new stipulation for comparison between two values. Such an exercise was not contemplated prior to the amendment as what was taken into account was the actual transaction value. - The law is now no more res integra that mere use of the term explanation will not be indicative of the fact that the amendment is clarificatory/declaratory. - The amendment will have a prospective effect. - HC
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• Court Criticizes Two-Month Fraud Credit Proceedings for Violating Natural Justice; Calls for Reasonable Timeframe Compliance.

  Case-Laws - HC : Violation of principles of natural justice - availment of fraudulent credit - The respondents have completed the entire proceedings within two months and there is violation of principles natural justice. Also, this Court has held that the respondents ought to have concluded the proceedings within reasonable time even though the outer time limit is five years. - HC
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• High Court Quashes GST Registration Cancellation Due to Lack of Jurisdictional Facts u/s 29(2)(e) of CGST Act 2017.

  Case-Laws - HC : Cancellation of GST registration of petitioner - The authorization is intended only to inspect the premises of an assessee. There is no basis for the alleged suppression of facts by the petitioner while obtaining registration to cancel the registration under Section 29(2)(e) of the CGST Act, 2017. No jurisdictional facts have been disclosed in notice that has been issued to the petitioner. - SCN proposing to cancell the registration quashed. - HC
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• Court Rules Provisional Attachment Ends After Final Assessment Order u/s 74; Sets Aside Previous Order.

  Case-Laws - HC : Validity of provisional attachment order - once a final order of assessment is passed- under Section 74, the order of provisional attachment must cease to subsist. - The order of attachment set aside. - HC
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Income Tax

• Mumbai Tax Refund Delay Investigation: Officer Error Costs Public Funds, Legal Actions Considered Under DTVSV Act Sections 5(2) & 6.

  Case-Laws - HC : Interest on refund due to error on the part of officer - As the amount of interest is being paid out of public exchequer, the Chief Principal Commissioner in-charge of Circle 3 (2), Mumbai shall hold an enquiry as to why the order u/s. 5(2) read with 6 of the DTVSV Act was not passed till 21st June 2022 and why the refund amount was not paid until 26th May 2023, identify where the fault was and may take such steps as available in law including recovering the interest paid to Petitioner from the erring officer (s). - HC
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• Court Deletes Additions on Unexplained Cash Deposit; Gifts from Relatives Exempt u/ss 69A and 56(2)(vi.

  Case-Laws - AT : Unexplained deposit of cash u/s 69A - as submitted that the source of the said sum is gift from relative which is not taxable u/s 56 - Considering the fact that undisputedly the gifts have been received from relatives as defined u/s 56(2)(vi) no dispute has been raised to the fact that father and brother of the assessee have sufficient source of income. - Additions deleted - AT
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• Faceless assessment order u/s 144B and 263 quashed due to limitation issues; remanded for reconsideration.

  Case-Laws - HC : Validity of faceless assessment u/s 143 (3) r.w.s 144B - period of limitation - shorter period to respond - The assessment order passed u/s 144B read with Section 263 of the Act for the assessment year 2015-16 is quashed and set aside. - Matter restored back to AO - HC
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• High Court Invalidates Prosecution for Delayed TDS Payment Due to Inadequate Consideration of Interest and Late Fees.

  Case-Laws - HC : Prosecution of offence u/s 276-B r/w 278B(2) - belated payment of TDS into the Central Government Treasury - The sanction was granted without considering payment of interest; and Late filing fee of TDS. Further reply which was filed on 01.02.2018 in the office of Additional Commissioner, Income Tax (TDS), Hyderabad is also not considered. - Launching prosecution proceedings on the basis of so called sanction is invalid. - HC
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• Limitation for Revision Under IT Act Sec 263 Starts from Original Assessment Date, Not Re-Assessment Date.

  Case-Laws - AT : Revision u/s 263 - period of limitation - To be calculated from the date of original assessment or from the date of re-assessment after reopening - the issue on which the ld. PCIT proposed the revision of order framed u/s 144 r.w.s. 147 dated 29.09.2021, in which these two scrips were not the subject matter of re-assessment proceedings. Therefore, the period of limitation has to run from the date of assessment as framed under section 143(1) dated 18.06.2013 - AT
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• Loan Waiver and Equipment Acquisition Deemed Taxable Business Income u/s 28(iv) of Income Tax Act.

  Case-Laws - AT : Additions of benefits or perquisites received as business income - waiver of loan u/s 28(iv) - the assessee had purchased the equipment, for which assessee had not paid. Thus, what actually, assessee had received was equipment, for which, the assessee had not paid anything. Thus, receipt of equipment, is a benefit, which is not in the form of cash. The assessee has also received benefit in the form of depreciation. - Additions confirmed - AT
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Customs

• Emails Evidence Ruled Inadmissible Due to Non-Compliance with Section 138C; Undermines Undervaluation Charge Validity.

  Case-Laws - AT : Scope and validity of the evidence collected from the emails - rejection of declared value on Bill of Entry - In the present case, the provisions of Section 138C of the Act were not complied with to use the computer printouts as evidence. It is noted that the certificate was not prepared during the seizure of the electronic devices, as required under the law. - The statements cannot be the sole reason to confirm the charge of undervaluation - AT
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Service Tax

• Appellate Authority Cannot Extend Appeal Filing Deadline Beyond 90 Days, Including 30-Day Condonation Period.

  Case-Laws - AT : Condonation of delay in filing appeal before the commissioner (appeals) - the appellate authority has no power to allow the appeal to be presented beyond the period of thirty days after the expiry period of sixty days. In other words, the appellate authority can entertain the appeal by condoning the delay only upto 30 days beyond the normal period for preferring the appeal, which is 60 days. No relief - AT
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• High Court Overturns CESTAT Order for Ignoring Key Legal Arguments in Rectification of Mistake Application.

  Case-Laws - HC : Scope of the order of tribunal - dismissal of ROM application without considering the contentions raised - question answered in favour of Appellant and against the Revenue, as in the order passed on the ROM the CESTAT has not recorded any findings on the position in law as canvassed by the petitioner which had a material bearing on the orders passed by the tribunal. - HC-
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Central Excise

• Court Rules Petitioner Entitled to CENVAT Credit on Grey Fabrics Despite Manufacturer's Absence; Invoices Valid.

  Case-Laws - HC : Fraudulent availment of CENVAT Credit - grey fabrics - Enough material was placed on record by the petitioner to suggest that the invoices were issued by duly registered manufactures and merely because the manufacturer is not available, does not mean that such manufacture who was registered with the central excise did not exist. Once receipt of goods is not disputed by a person taking credit and necessary invoices are issued, the petitioner is entitled to take credit - HC
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• Court Rules Sabka Vishwas Scheme Benefits Can't Be Denied Due to One-Year Limitation; Adjust CENVAT Credit as Per Annexure P-3.

  Case-Laws - HC : Denial of CENVAT Credit - Availing benefit of SVLRDS - adjustment/deduction the excise duty paid by the petitioners through utilizing Cenvat Credit at the time of investigation - this benefit cannot be denied on the ground that the period of limitation of one year has gone by, as under the benefit under Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 (annexure P-3), any amount deposited during enquiry has to be adjusted. - HC
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• High Court Quashes Notification Rejecting Excise Duty Refund Applications Under Area-Based Exemption as Legally Untenable.

  Case-Laws - AT : Refund of excise duty payable on value addition - Area based exemption - Effect of the notification which was quashed by the high court - It is observed that the rejection of the Applications filed by the Appellant for Special rate fixation on the ground that they have foregone such option, is legally not tenable - AT
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Case Laws:

• GST

• 2023 (9) TMI 50
  Detention of goods - goods in question was not carrying e-way bill which was required to be carried while the goods were in transport - Section 129 of GST Act - HELD THAT:- Admittedly, the goods were originated from Gwalior, Madhya Pradesh and its destination was Panna, Madhya Pradesh. It is also admitted by all the authorities below that during transportation of the goods, tax invoices G.R. are genuine. It is further admitted that the State of Madhya Pradesh has issued a notification dated 24.4.2018 mentioning therein 11 items for which only the e-way bills are required during transport and other items were exempted from accompanying the e-way bill. The respondent authorities have accepted that the goods were originating from Gwalior, Madhya Pradesh and to be terminated at Panna, Madhya Pradesh. On perusal of the impugned order it is also found that it is categorically mentioned that the origination as well as termination of the goods in question was in State of Madhya Pradesh meaning thereby the authorities are of the view that the goods were not to be unloaded in the State of UP or any intention to avoid tax. However, mainly on the ground of some small technical fault for not carrying the e-way bill, the penalty ought not to have been levied in the absence of any discrepancy in document accompanying the goods. In view of above, the impugned orders cannot be sustained in the eyes of law. The impugned orders are set aside. Any amount already deposited by the petitioner during pendency of the present litigation, shall be refunded to him within a period of 20 days from the date of production of certified copy of this order before the authority concerned - Petition allowed.

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• 2023 (9) TMI 49
  Provisional attachment of the Petitioners bank accounts - Petitioners are not interested to have any opportunity of personal hearing - HELD THAT:- The designated officer shall take the show cause notices to its logical conclusion and pass final orders on the show cause notices on or before 15th September 2023. All contentions in regard to whatever has been contended by the Petitioners now falls for consideration of the designated officer in adjudication of the show cause notices. All the contentions need to be kept open to be agitated by the Petitioners after the decision on the show cause notices in question, as it is already observed that the show cause notices be adjudicated by 15th September 2023 - it is kept open that all contentions of the Petitioners in that regard to be agitated at the appropriate time after the adjudication of the show cause notices. Petition disposed off.

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• 2023 (9) TMI 48
  Maintainability of appeal - appeal filed beyond the prescribed period of limitation - Court interfered mainly on the ground that it was incumbent to grant an opportunity of hearing irrespective whether a reply was filed or not in terms of the mandate of Section 75(4) of GST Act - principles of natural justice - HELD THAT:- Considering the submissions made at the Bar, from the order of assessment passed in pursuance to show-cause notice issued under Section 74 of GST Act, admittedly, no hearing has been accorded to the petitioner, which is contrary to the mandate of law prescribed under Section 75(4) of GST Act; as an expropriatory action, even otherwise, the principles of natural justice had to be complied with. Matter is remanded to the respondents to pass orders afresh in accordance with law after giving an opportunity of hearing - Petition allowed by way of remand.

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• 2023 (9) TMI 47
  Maintainability of appeal - appeal dismissed on the ground of the same being beyond the prescribed period of limitation prescribed under Section 107 of the GST Act - HELD THAT:- It is clear no opportunity of hearing was granted to the petitioner. It is well settled that this issue is squarely covered by the judgment of this Court in the case of Bharat Mint And Allied Chemicals Versus Commissioner Commercial Tax And 2 Others [ 2022 (3) TMI 492 - ALLAHABAD HIGH COURT] , wherein this Court had issued directions, thus the orders passed against the petitioner are contrary to the mandate of Section 75 of the GST Act and also the judgment of this Court in the case of Bharat Mint and Allied Chemicals, as such, the impugned order dated 14.07.2021 can not be sustained and the same is against the principle of natural justice, as such, the same is quashed. The respondent authority would be at liberty to to pass a fresh order in accordance with law after giving opportunity of hearing to the concerned parties - Petition allowed.

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• 2023 (9) TMI 46
  Violation of principles of natural justice - complete denial of opportunity of oral hearing before the Assessing Authority - validity of assessment order - HELD THAT:- Once it has been laid down by way of a principle of law that a person/assessee is not required to request for opportunity of personal hearing and it remained mandatory upon the Assessing Authority to afford such opportunity before passing an adverse order, the fact that the petitioner may have signified No in the column meant to mark the assessee s choice to avail personal hearing, would bear no legal consequence. Even otherwise in the context of an assessment order creating heavy civil liability, observing such minimal opportunity of hearing is a must. Principle of natural justice would commend to this Court to bind the authorities to always ensure to provide such opportunity of hearing - The stand of the assessee may remain unclear unless minimal opportunity of hearing is first granted. Only thereafter, the explanation furnished may be rejected and demand created. Not only such opportunity would ensure observance of rules of natural of justice but it would allow the authority to pass appropriate and reasoned order as may serve the interest of justice and allow a better appreciation to arise at the next/appeal stage, if required. The matter is remitted to the respondent no.2/Assistant Commissioner, State Tax, Sector-1, Gorakhpur to issue a fresh notice to the petitioner within a period of two weeks from today - petition allowed by way of remand.

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• 2023 (9) TMI 45
  Detention of goods (frozen shrimp) alongwith conveyance - no E-way bill accompanied the goods in transit - HELD THAT:- Section 129(1) provides for detention of goods where such goods are transported in contravention of the provisions of the Act or the Rules made thereunder. Section 129 (1)(a) provides for release of the goods on payment of penalty equal to two hundred percent of the tax payable on such goods and in case of exempted goods, on payment of an amount equal to two percent of the value of the goods or twenty-five thousand rupees, whichever is less. In the instant case, the allegation that the goods were intended for export and were not exingable to tax not being under dispute, it is opined that the contention of the respondents that the penalty payable is as calculated in Exhibit P5 cannot be accepted under any circumstances. Since the instant case involves a palpable erroneous exercise of jurisdiction and would result in miscarriage of justice, if this Court declines jurisdiction, the further contention that the petitioner ought to have availed the statutory remedy of appeal before approaching this Court also cannot be accepted. Exhibits P5 and P6 orders are set aside. The amount claimed in Exhibit P5 is limited to Rs. 25,000/- under Section 129(1) (a) of the GST Act. On payment of such amount, all proceedings against the petitioner with regard to the transaction in question shall stand dropped - petition disposed off.

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• 2023 (9) TMI 44
  Refund of unutilised balance of Input Tax Credit (ITC) of compensation cess on account of zero-rated supplies of goods - retrospective effect of amendment in Rule 89(4) of CGST Rules, 2017 - HELD THAT:- As far as the explanation inserted by way of amendment in Rule 89(4) of the CGST Rules, 2017, vide Notification No. 14/2022 Central Tax dated 5.7.2022 is concerned; these rules were not in existence at the time of passing of the Order in Appeal dated 11.10.2021. Rule 1(2) of 2022 Amendment Rules, specifically provides that save as otherwise provided in these rules, they shall come into force on the date of their publication in the Official Gazette . Except for Rules 7, 9, 10, and 19 for which dates with retrospective operation have been provided, no other rules have been given any retrospective effect. The 2022 Amendment Rules inserts a new stipulation for comparison between two values. Such an exercise was not contemplated prior to the amendment as what was taken into account was the actual transaction value. Therefore, by way of the amendment, a substantive change has been brought about in the law and therefore the amendment ought to operate prospectively. The law is now no more res integra that mere use of the term explanation will not be indicative of the fact that the amendment is clarificatory/declaratory. The amendment in Rule 89 (4) of CGST Rules, 2017 which came into effect vide Notification No. 14/2022-Central Tax dated 05.07.2022 is not clarificatory in nature and thus will have a prospective effect. In all these writ applications since the period involved is prior to the amendment; as such, the respective impugned orders deserve to be quashed and set aside. Application allowed.

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• 2023 (9) TMI 43
  Violation of principles of natural justice - availment of fraudulent credit - invoice issued without supply of goods - Order passed based on assumptions - levy of 100% penalty - HELD THAT:- The respondents are empowered to pass order within a period of five years - this Court is of the considered opinion that, if it is considered as outer time limit prescribed for the respondents to pass orders, then the respondents may be empowered to pass orders. But the assessee must be given sufficient opportunity. In the present case the notice was issued on 01.12.2022 and 03.01.2023 and Summary Order was passed on 07.03.2023, i.e. within two months the respondents have passed an order. Even though the provisions prescribe five years as outer limit but the provisions do not prescribe minimum time from passing order, in such circumstances the respondents ought to have passed order within reasonable time. Two months period definitely is not reasonable time and the petitioner is right in stating that adequate opportunity was not granted to the petitioner. Levy of 100% penalty - HELD THAT:- The respondents have completed the entire proceedings within two months and there is violation of principles natural justice. Also, this Court has held that the respondents ought to have concluded the proceedings within reasonable time even though the outer time limit is five years. By passing the orders early, the respondent have denied the valuable right of the petitioner to avail the concession granted under section 74. The petitioner has already paid the entire tax liability and the interest. Therefore, this Court is directing the respondents to collect the 15% of the penalty alone and the petitioner shall pay the 15% penalty within four weeks from the date of receipt of the order. On such payment the respondents shall conclude the proceedings in respect of the notice as stated in section 74. Petition allowed.

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• 2023 (9) TMI 42
  Maintainability of petition - Validity of assessment order - computation of the turn over and the determination of the taxable turnover and the tax payable - violation of principles of natural justice - HELD THAT:- Having not availed the statutory remedies available, the petitioner cannot seek to approach this Court under Article 226 of the Constitution of India to challenge an assessment order especially with respect to the computation of the turn over and the determination of the taxable turnover and the tax payable, as arrived at by the Assessing Officer. In the BGST Act, an appellate remedy is provided under Section 107, which has to be availed within a period of three months or with a delay within a further period of one month. It is trite law that when there is a specific period for delay condonation provided, there cannot be any extension of the said period by the Appellate Authority or by this Court under Article 226 of the Constitution. There is no jurisdictional error, violation of principles of natural justice or abuse of process of law averred or argued by the petitioner in the above writ petition. From the records produced, it is clear that an inspection was conducted in the premises of the assesse and the same was also found locked - there is no ground stated in the writ petition which would enable invocation of the extraordinary remedy under Article 226 - Petition dismissed.

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• 2023 (9) TMI 41
  Maintainability of petition - appeal rejected on the ground that 2nd appellate tribunal not yet been constituted - petitioner has already deposited 10% of the demanded tax amount before the first appellate authority and as there is no second appellate forum - HELD THAT:- Since the petitioner wants to avail the remedy under the provisions of law by approaching 2nd appellate tribunal, which has not yet been constituted, as an interim measure subject to the Petitioner depositing entire tax demand within a period of fifteen days from today, the rest of the demand shall remain stayed during the pendency of the writ petition. Application disposed off.

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• 2023 (9) TMI 40
  Validity of SCN - inspection of place of business - Cancellation of GST registration of petitioner - HELD THAT:- The Impugned Show Cause Notice dated 03.07.2023 has not even specified the person to whom the reply has to be made by the petitioner. Section 67(1) of the CGST Act, 2017 merely deals with authorization to an officer not below the rank of Joint Commissioner can inspect any place of business of the taxable person or the person engaged in business of transporting goods or the owner or the operator or warehouse or godown or in other place - There is no basis for the alleged suppression of facts by the petitioner while obtaining registration to cancel the registration under Section 29(2)(e) of the CGST Act, 2017. No jurisdictional facts have been disclosed in notice that has been issued to the petitioner. Taking into consideration the facts and circumstances of the case, the Impugned Show Cause Notice is to held as bad in law. It is therefore liable to be quashed - petition allowed.

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• 2023 (9) TMI 39
  Rejection of appeal - delay in filing the appeal manually in absence of the proper instruction/guidelines and /or facility in the GST portal - HELD THAT:- The appeal that was filed by the petitioner manually on 12.06.2023 already complies with the requirements of the N/N. 29/2023-Central Tax dated 31.07.2023 barring the delay in filing the appeal in time as per Section 107 of the respective Goods and Service Tax Act, 2017. Since the clarification was issued for the first time only on 31.07.2023, the appeal filed by the petitioner prior to its issuance on 12.06.2023 has to be construed to have been filed in time. Therefore, the impugned order/communication of the 1st respondent is liable to be quashed. It is accordingly quashed. The second respondent is therefore directed to number the appeal filed by the petitioner on 12.06.2023 and dispose the same on merits and in accordance with law on its turn - Petition allowed.

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• 2023 (9) TMI 38
  Maintainability of appeal - petitioner received two reminders, instead of filing reply, the petitioner had appeared in person - HELD THAT:- The facts of the case are almost identical as in TVL. SAMIKKANNU SENTHIL KUMAR PROPRIETOR OF M/S. ALPHA AGENCIES VERSUS THE APPELLATE DEPUTY COMMISSIONER (ST) (FAC), THE DEPUTY STATE TAX OFFICER-2, VALPARAI CIRCLE, VALPARAI [ 2023 (8) TMI 971 - MADRAS HIGH COURT ] wherein, the first respondent Appellate Deputy Commissioner has been directed to dispose of the petitioner s appeal on merits. Consequently, the impugned order passed by the first respondent is quashed and the case is remitted back to the first respondent to dispose of the appeal of the petitioner on merits and in accordance with law within a period of four weeks from the date of receipt of a copy of this order. Petition disposed off.

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• 2023 (9) TMI 37
  Maintainability of appeal - Validity of provisional attachment order - HELD THAT:- The Supreme Court in M/S RADHA KRISHAN INDUSTRIES VERSUS STATE OF HIMACHAL PRADESH ORS. [ 2021 (4) TMI 837 - SUPREME COURT] has expressed in no uncertain terms that once a final order of assessment is passed, in that case under Section 74 of the Himachal Pradesh Goods and Services Tax Act, the order of provisional attachment must cease to subsist. In the present case, the order-in-original has also been passed under Section 74 of the CGST Act - that being the position, there are no justification in continuing with the impugned orders of attachment. The impugned orders of attachment dated 15.07.2022 passed by respondent No. 1 are hereby set aside - Petition allowed.

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• 2023 (9) TMI 36
  Violation of principles of natural justice - petitioner was not heard prior to passing of the impugned order - adjournment was sought on the ground that additional information was to be collected - inability to collect the requisite particulars due to marriage reception of daughter - HELD THAT:- The reason constitute sufficient cause and that the officer ought to have taken note of the same and re-schedule the date of hearing to accommodate the request as aforesaid. The appeal stands restored to the file of R1. The petitioner will appear before the appellate authority / R1 on Monday, i.e., 08.05.2023 at 10.30 a.m. without anticipating any further notice in this regard, shall be heard and the appeal disposed within a period of eight weeks from the date of personal hearing - petition allowed.

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• Income Tax

• 2023 (9) TMI 35
  Exemption u/s 54B denied - case of the appellant is that he and his three brothers had sold jointly owned land and for his 1/4th share he purchased land in the name of his wife and claimed exemption under Section 54B - HELD THAT:- As decided by HC [ 2020 (4) TMI 725 - PUNJAB HARYANA HIGH COURT] after selling the agricultural land the appellant purchased a land worth his share, in the name of his wife. The issue is directly covered by the decision of this Court in Dinesh Verma s case [ 2015 (7) TMI 486 - PUNJAB HARYANA HIGH COURT] . The reliance of Gurnam Singh s case 2008 (4) TMI 28 - PUNJAB AND HARYANA HIGH COURT] will not enhance the case of the appellant as the property in that case was purchased in the joint name of the assessee and his only son, which is not the case in the present case, thus issue decided against assessee - HELD THAT:- No merit in the Special Leave Petition.

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• 2023 (9) TMI 34
  Interest u/s 244A on refund - refund amounts payable as reflected in Form No. 5 dated 15th June 2021 issued under the Direct Tax Vivad Se Vishwas (DTVSV) Act - HELD THAT:- In the present case, it is not in doubt that Petitioner was entitled to refund which ought to have been processed and paid latest by 31st July 2021. The amount as stated in the affidavit-in-reply has been paid only on 26th May 2023. Consequently, we are of the view that Petitioner is entitled to interest on this amount from 1st August 2021 upto 26th May 2023 at the rate of 6% p.a. which is the rate prescribed u/s 244A of the Act. As the amount of interest is being paid out of public exchequer, the Chief Principal Commissioner in-charge of Circle 3 (2), Mumbai shall hold an enquiry as to why the order u/s. 5(2) read with 6 of the DTVSV Act was not passed till 21st June 2022 and why the refund amount was not paid until 26th May 2023, identify where the fault was and may take such steps as available in law including recovering the interest paid to Petitioner from the erring officer (s). Petitioner has also prayed for cost. Since we have awarded simple interest at 6% p.a. we are not granting any cost in this case. Respondents, are, however, put to notice that if such issues come in future, Court may even consider imposing cost to be recovered from the concerned officer s salary.

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• 2023 (9) TMI 33
  Revision u/s 263 - Validity of faceless assessment u/s 263 r.w.s. 143 (3) and 144B- period of limitation - shorter period to respond - No action was taken after order u/s 263 passes for over a period of 17 months - At the far end of the schedule when the time limit to complete the assessment was to come to an end, the department on 08.09.2021 and 21.09.2021 issued first and second notices respectively - as argued without working out a schedule so as to give a reasonable opportunity to the petitioner, particularly when the assessment is faceless, the respondents giving only a day for the petitioner to respond so as to save the limitation period, obviously created a situation where the petitioner lost an adequate opportunity to submit a response - HELD THAT:- The facts of the case in the present are similar to the one in the case of Dineshkumar Chhaganbhai Nandani [ 2023 (6) TMI 935 - GUJARAT HIGH COURT] inasmuch as the notice of 28.09.2021 called upon the petitioner to file a response by 29.09.2021 at 11.59 pm. On the very next date, since the assessment was getting time-barred, an order of assessment was passed only for the compliance of the provisions and depriving the petitioner of a reasonable opportunity of being heard. The Division Bench in the case of Dineshkumar Chhaganbhai Nandani (supra) has considered several decisions of this court on the issue of reasonable opportunity of being heard in context of Section 144B of the Act. The assessment order passed u/s 144B read with Section 263 of the Act for the assessment year 2015-16 is quashed and set aside. The matter is remitted to the Assessing Officer so as to enable the petitioner to be heard in light of the detailed submissions made by the petitioner

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• 2023 (9) TMI 32
  Prosecution of offence u/s 276-B r/w 278B(2) - belated payment of TDS into the Central Government Treasury - A1 company had deducted at source on more than 2664 occasions but the same was deposited with a time variation of 1 to 12 months - HELD THAT:- The Hon ble Supreme Court in the case of Mohd. Iqbal Ahmed v. State of Andhra Pradesh [ 1979 (1) TMI 238 - SUPREME COURT] held that it is well settled that any case instituted without a proper sanction must fail because this being a manifest defect in the prosecution, the entire proceedings are rendered void ab initio. Prosecution launched without a valid sanction, it was held that the cognizance taken by the Special Judge was without jurisdiction and proceedings were quashed. The sanction was granted without considering payment of interest; and Late filing fee of TDS. Further reply which was filed on 01.02.2018 in the office of Additional Commissioner, Income Tax (TDS), Hyderabad is also not considered. The competent authority not considering the same amounts to not considering the facts of the case and granting sanction which is invalid. Apparently sanction was sought by suppressing facts or deliberately omitted. It is not disputed that the Sanction mentioning that the penal interest not being paid and the petitioners not replying to show cause is apparently wrong. For the said reason of launching prosecution on the sanction, which according to this Court is invalid, the proceedings before the learned Special Court are liable to be quashed.

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• 2023 (9) TMI 31
  Denial of FTC - delay in filing Form 67 - HELD THAT:- It is an admitted position that the assessee filed Form 67 on 26.03.2021 alongwith the revised return before the end of the relevant AY 2020-21 which is in conformity with the CBDT notification No. 100/2022 amending Sub Rule 9 of Rule 128 of the Rules. Various coordinate benches of the Tribunal have held that filing Form 67 is a procedural/directory requirement and is not a mandatory requirement. We, therefore, disagree with the view of the CIT(A) on the point - As decided in Miss Brinda Rama Krishna [ 2022 (2) TMI 752 - ITAT BANGALORE] as held Rule 128(9) of the Rules does not provide for disallowance of FTC in case of delay in filing Form No.67; (ii) filing of Form No.67 is not mandatory but a directory requirement and (iii) DTAA overrides the provisions of the Act and the Rules cannot be contrary to the Act. Thus we hereby direct the AO to allow the impugned credit of FTC to the assessee.

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• 2023 (9) TMI 30
  Revision u/s 263 - AO has completed the assessment without making any enquiries with regard to cash deposits during the demonetization period and penalty proceedings were not initiated u/s 271D of the Act which renders the order passed u/s 143(3) of the Act dated 04.07.2019 as erroneous and prejudicial to the interests - A/R contended that the case of the assessee was selected for limited scrutiny under CASS only for examination of cash deposited during the demonetization period - HELD THAT:- AO has conducted a reasonable enquiry by calling for the explanation from the assessee and assessee furnished the evidences on the basis of which a conclusion was made by the AO. The case of the assessee is supported by the decision of Mukul Kumar ( 2009 (1) TMI 886 - PATNA HIGH COURT ) wherein a similar issue has been decided in favour of the assessee. In the case of Gabriel India Limited [ 1993 (4) TMI 55 - BOMBAY HIGH COURT] has held that the assessment order cannot be framed as erroneous unless it is not in accordance with law or against the facts on records. Hon ble Court has also held that if the AO acting in accordance with law makes assessment, the same cannot be branded as erroneous by the Commissioner simply because, according to him, the order should have been written more elaborately and this section does not visualize a case of substitution of the judgment of the Commissioner for that of the AO who has passed the order, unless the decision is held to be erroneous. Commissioner, on perusal of the records, may be of the opinion that the estimate made by the officer concerned was on the lower side and if left to the Commissioner, he would have estimated the income at a figure higher than the one determined by the AO. In that context the Hon ble Court has also held that that jurisdiction would not vest the Commissioner with the power to re-examine the accounts and determine the income himself at a higher figure as it is because the AO has exercised the quasi-judicial power vested in him in accordance with law and arrive at a conclusion and such a conclusion cannot be termed to be erroneous simply because the Commissioner does not feel satisfied with the conclusion. Similarly, in the case of Malabar Industries [ 2000 (2) TMI 10 - SUPREME COURT] has held that the provisions of Section 263 of the Act cannot be invoked to correct each and every type of mistake or error committed by the AO and it is only when an order is erroneous that the Section will be attracted - incorrect assumption of facts or an incorrect application of law will satisfy the requirement of the order being erroneous and in the same category fall orders passed without applying the principles of natural justice or without application of mind. Every loss of revenue as a consequence of an order of the AO cannot be treated as prejudicial to the interests of the revenue. By giving an example that when the AO adopts one of the courses permissible in law and it has resulted in loss of revenue or where two views are possible and the AO has taken one view with which the Commissioner does not agree, it cannot be treated as an erroneous order prejudicial to the interests of the revenue unless the view taken by the AO is unsustainable in law. Therefore, the view taken by the AO is not an incorrect view and that the assessment was passed after examining the record, evidences furnished by the assessee. Therefore, accordingly we are inclined to quash the order passed u/s 263 of the Act by allowing the appeal of the assessee.

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• 2023 (9) TMI 29
  Non deduction u/s 194C - non deduction of TDS on payment to transport operators - assessee contended that as the PAN of the transport company has been furnished, the assessee was on the belief that TDS was not to be deducted for the payments and relied on the provision of section 194C(6) - A.O. disregarded the submission of the assessee for the reason that para 49.3 of the explanatory Circular for Finance (No.2) Act, 2009 has amended to exempt from deducting TDS but subject to the condition that the deductors will be required to furnish the PAN details of the operators to the department in the prescribed format as per the conditions laid down u/s. 194C(7) and the assessee has failed to furnish the relevant details in the prescribed form to the concerned authority, thereby failing to comply with the provisions of section 194C(7) - HELD THAT:- As assessee has already deducted and paid the said TDS amount and the revised return filed by the assessee was not considered by the lower authorities. We, therefore, direct the A.O. to allow the claim of the assessee after due verification of the facts of the payment made by the assessee. Ground raised by the assessee is allowed.

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• 2023 (9) TMI 28
  Unexplained deposit of cash u/s 69A - as submitted that the source of the said sum is gift from relative which is not taxable under section 56 - CIT(A) on the ground that the assessee had failed to produce any supporting materials this regard, confirmed the addition made by AO - HELD THAT:- It is claimed that the assessee received gift from father, mother and brother. It is also submitted that father of the assessee is a retired High Court Judge, namely, Justice Subhro Kamal Mukherjee, having PAN and files income tax returns regularly. The brother of the assessee is a Non-Resident Indian settled in U.S.A. and is not assessed to tax in India. Mother of the assessee is not an income tax assessee and she is a housewife. Considering the fact that undisputedly the gifts have been received from relatives as defined u/s 56(2)(vi) no dispute has been raised to the fact that father and brother of the assessee have sufficient source of income. Though, the assessee has not file any documentary evidence in the shape of gift deed, however, the details of the relatives were very much placed before the AO and if he was not satisfied he might have issued notice under the Act for seeking the necessary information. Assessee stated that copies of the income tax return of her father for Assessment Year 2016-17 was placed before the AO requesting him to consider the genuineness of the gift. As considering the fact that the donors either have sufficient source of income or they are senior citizens who have some past accumulated savings and, therefore, considering the same, we find that the genuineness of the said gift is proved and thus inclined to hold in favour of the assessee. We the set-aside the finding of the CIT(A) and delete the addition made u/s 69 of the Act. Accordingly all the effective grounds raised by the assessee stand allowed.

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• 2023 (9) TMI 27
  Revision u/s 263 - period of limitation - To be calculated from the date of original assessment or from the date of re-assessment after reopening - applicability of doctrine of merger - whether period of limitation commences from the date of original assessment and not from the date of reassessment? - HELD THAT:- As in the case of ICICI Bank Limited [ 2012 (2) TMI 308 - BOMBAY HIGH COURT] wherein has held that where the jurisdiction u/s 263(1) is sought to be exercised with reference to an issue which is covered by the original order of assessment u/s 143(3) and which does not form the subject matter of the reassessment, the limitation must necessarily begin to run from the date of order passed u/s 143(3). In the instant case before us also the issue on which the ld. PCIT proposed the revision of order framed u/s 144 r.w.s. 147 dated 29.09.2021, in which these two scrips were not the subject matter of re-assessment proceedings. Therefore, the period of limitation has to run from the date of assessment as framed under section 143(1) dated 18.06.2013 i.e. from the end of financial year 31.3.2016. We incline to hold that the revisionary jurisdiction exercised by the ld. PCIT is hopelessly barred by limitation. Appeal of the assessee is allowed.

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• 2023 (9) TMI 26
  Addition on account of waiver of loan - business income OR capital receipt - waiver of loan which was for acquiring plant and machinery - AO treated the waiver of loan amount and waiver of Purchase Price as Income of the Assessee u/s 28(iv) - assessee had claimed depression on the plant and machinery purchased from Kennametal Inc. However, the assessee has not paid for the said Plant and Machinery, but claimed depreciation on it without paying for it - HELD THAT:- Hon ble Supreme Court IN Mahindra Mahindra Ltd [ 2018 (5) TMI 358 - SUPREME COURT] has held that to invoke Section 28(iv) the benefit which is received has to be in some form other than in the shape of money. In the Case of Mahindra Mahindra, the company Mahindra Mahindra had received cash loan. However, in the case of the assessee, the assessee had received Equipment valuing US $3,66,000/- due to purchase of equipment. The assessee had not received any cash Loan of US $ 3,66,000/-. In this case, the assessee had purchased the equipment, for which assessee had not paid. Thus, what actually, assessee had received was equipment, for which, the assessee had not paid anything. Thus, receipt of equipment, is a benefit, which is not in the form of cash. The assessee has also received benefit in the form of depreciation. Therefore, the amount of US$ 3,66,000/- which is the Purchase Price of the Machinery, equipment is a benefit received by the assessee, hence, it is taxable u/s. 28(iv) of the Act. Thus, we uphold the order of the AO with reference to US $366000/-, in principle, that US $ 3,66,000/- is taxable u/s 28(iv) of the Act. The assessee had claimed that it was a loan, however, we have held that it was not a loan but assessee had received Machinery and Equipment. Hence, Ground No.3 of the assessee is dismissed. Loan - Kennametal Inc USA had advanced Cash Loan of Rupees equivalent to US $5,00,000/- to Assessee DHL. There was a promissory note.This Loan is independent of the Equipment sold by Kennametal Inc USA to assessee valuing US$ 3,66,000/-. The Loan was in addition to the equipment sold. Vide, the Master Agreement Kennametal Inc has waived the cash Loan of US $5,00,000/- which was advanced to the assessee vide Loan Agreement dated 13 th March, 1995. The AO has treated the said cash loan of US $5,00,000/- also as income u/s 28(iv). The said Loan of US $ 500000/- was a cash Loan. Therefore it is held that the waiver of cash Loan of Rupees equivalent to US $5,00,000/- is not income within the purview of Section 28(iv) of the Act. Hence, the AO is directed to delete the impugned addition qua US $ 5,00,000/-. Adoption of exchange rate - Assessee has entered in its books of account the value of equipment in Rupees based on the exchange rate applicable on the date of receipt of equipment. The benefit received by the assessee is equipment, hence, while arriving at the value of the said benefit, the exchange rate applicable on the date of receipt of the equipment is to be considered. The AO shall take the Conversion rate on the date of receipt of the Equipment and not the date of waiver. Therefore, while converting the US $3,66,000/-into Rupees, the AO shall consider the rate of exchange applicable on the date of receipt of the equipment. Accordingly, the Ground number 4 is allowed for statistical purpose.

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• 2023 (9) TMI 25
  TP adjustment - low rate of interest charged on advance to Associated Enterprises-AE - TPO determined the ALP of the international transaction of lending of USD 110 million also by applying LIBOR + 200 basis points and made the transfer pricing adjustment - HELD THAT:- Considering the purpose for which this USD 110 million was given to its AE by the assessee and also considering the fact that the AE could not utilise the monies received from the assessee for any other purpose other than for the purpose of participation in the bid, we have no hesitation to hold that this lending of USD 110 million should be construed as a special purpose lending and accordingly to be treated as separate and distinct from loan simplicitor. We find that similar issue had come up for adjudication of this Tribunal in the case of Bennett Coleman And Co. Ltd [ 2021 (9) TMI 340 - ITAT MUMBAI] Thus we have no hesitation in directing the ld. TPO / AO to delete the transfer pricing adjustment made in respect of special purpose loan of USD 110 million. Accordingly, ground No.1 raised by the assessee is allowed. Foreign tax credit tax while determining the tax liability on the assessee - HELD THAT:- We find that the interest income received by the assessee from Home Field International Ltd. (AE) was duly offered to tax by the assessee company in Mauritius. The assessee paid the due taxes thereon at Mauritius. The assessee is only seeking foreign tax credit for the taxes already paid at Mauritius since the very same interest income received from AE is also subjected to tax in India in the hands of the assessee. We find that this is a legitimate claim of the assessee and hence, we direct the ld. AO to grant foreign tax credit tax while determining the tax liability on the assessee pursuant to this Tribunal order. Accordingly, the additional ground raised by the assessee is allowed. Disallowance of payments made to various institutions by invoking the provisions of section 40A(9) - HELD THAT:- As relying on assessee own case [ 2019 (4) TMI 2064 - ITAT MUMBAI] we direct the ld. AO to delete the disallowance made in this regard. Accordingly, the Ground raised by the assessee is allowed. Treatment of subscription paid under the Brand Equity and Business Promotion Agreement - payment was sought to be disallowed by the AO on the ground that the assessee was a Tata Group Company since 1939 and has its own reputation and logo, hence there is no need to use separate Tata Logo - HELD THAT:- As relying on assessee own case A.Y. 2001-02, A.Y. 2002-03 [ 2019 (4) TMI 2064 - ITAT MUMBAI] , A.Y. 2003-04 [ 2021 (2) TMI 851 - ITAT MUMBAI] and A.Y. 2004-05 [ 2022 (7) TMI 389 - ITAT MUMBAI] - Ground raised by the assessee is allowed. Denial of deduction u/s 80IA - profits derived by the Mithapur Power Plant - HELD THAT:- We hold that assessee is entitled for deduction u/s. 80IA of the Act in respect of sale of steam from its power plant to non-eligible units. Assessee was justified in recognizing the sale income of power at the rate of 4.74 power unit. Thus we find that basis on which the deduction u/s. 80IA of the Act has been denied by the ld. AO for the year under consideration has no legs to stand in the eyes of law. Hence, we direct the AO to grant deduction u/s. 80IA of the Act in respect of its captive power plant, in accordance with law. Accordingly, ground raised by the assessee is allowed. Denial of deduction u/s. 80IB - fertilizer subsidy received by the Haldia unit in West Bengal - HELD THAT:- As stated what assessee has recovered is only part of sale price in the form of subsidy. Hence, in our considered opinion, the same would be eligible for deduction u/s. 80IB of the Act. In fact, in A.Y. 2003- 04 this Tribunal in assessee s own case [ 2022 (2) TMI 818 - ITAT MUMBAI] had accepted the stand of the assessee and held that fertilizer subsidy represent part of the consideration received for sale of fertilizers and hence, the same would be eligible for deduction u/s. 80IB of the Act. This order was subsequently followed by this Tribunal in assessee s own case for A.Y. 2004-05 and 2005-06 [ 2022 (7) TMI 389 - ITAT MUMBAI] also. We direct the ld. AO to grant deduction u/s. 80IA of the Act in respect of fertilizer subsidy received by the assessee. Accordingly, the ground raised by the assessee is allowed. Disallowance of commission paid to Managing Director and Executive Director by applying the provisions of Section 36(1)(ii) of the Act - HELD THAT:- As it is very clear that in order to apply this provision in the first instance, the Managing Director and Executive Director should be shareholders and they should have been paid commission in lieu of distribution of profit or as dividend. Since the ld. AR placed on record the list of shareholders for the first time before us to drive home the point that both the MD and ED were not shareholders of the assessee company at the relevant point in time, we deem it fit and appropriate to restore this issue to the file of the ld. AO for the limited purpose of verification of facts as to whether Mr. P R Menon and Shri Homi R Khushrokhan were shareholders of the assessee company at the relevant point in time. If they are not found to be shareholders, then the disallowance made u/s.36(1)(ii) of the Act should be deleted. Ground raised by the assessee is allowed for statistical purposes. Deduction made in respect of post retirement medical benefits provided to retired employees by the assessee company - Assessee company has a scheme whereby the existing employees and employees who had retired from the services of the company on attainment of normal retirement age, are entitled for their medical check-up and medicines at the company hospital for the rest of their life - HELD THAT:- On perusal of the provisions of Section 43B of the Act, this expenditure provision made for post retirement medical benefits would not fall under any of the clauses provided in Section 43B of the Act. It is an admitted fact that no fund is created by the assessee in respect of this post retirement medical benefits. However, since the actuarial valuation report was placed before this Tribunal for the first time to justify the fact that the said provision has been made on a scientific basis by placing reliance on the registered valuation report, and also considering the fact that this report was not in the possession of the lower authorities, we deem it fit and appropriate in the interest of justice and fair play, to remand this issue to the file of the ld. AO for denovo adjudication in accordance with law. Accordingly, the ground No.10 raised by the assessee is allowed for statistical purposes. Weighted deduction in respect of scientific research and development u/s.35(2AB) - AO did not agree to the contentions of the assessee on the ground that this claim is made for the first time before him during the course of assessment proceedings and since the claim was not made either in the return of income or in the revised return of income, applying the decision of Goetze India Ltd [ 2006 (3) TMI 75 - SUPREME COURT] denied to grant deduction for the same - HELD THAT:- We find that the decision of Goetze India Ltd does not prohibit an assessee who has a valid claim to be made before the appellate authorities. Moreover the restriction provided by the said decision, shall not apply to appellate authorities. This is provided in the last paragraph of the decision of the Hon ble Supreme Court. However, the veracity of the claim had not been examined at all by the ld. AO. Hence, we deem it fit and appropriate, in the interest of justice and fairplay, to restore this issue to the file of the ld. AO for denovo adjudication.

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• Customs

• 2023 (9) TMI 24
  Seeking release of imported goods without levy of Detention, Demurrage and Container Storage Charges - import of Fuel Oil in Flexi Bags - Regulation 6 (1) (l) of the Handling of Cargo in Customs Areas Regulations, 2009 - HELD THAT:- Liberty granted to the petitioner to approach the 3rd and the 4th respondents for release of the goods. However, it is made clear that neither the issue decided on the quantum that is due to the 3rd and 4th respondents nor issue is resolved that may arise for consideration, which is intended to, while disposing of the batch of matters pending. The writ petition disposed off.

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• 2023 (9) TMI 23
  Refund of Additional Duty - rejection on the ground that said amount related to quantity of 56.66 CBM sold after processing - HELD THAT:- The dispute in the present appeal is settled by this Tribunal also in the matter of M/S ARAVIND TRADERS VERSUS COMMISSIONER OF CUSTOMS-COCHIN-CUS [ 2021 (7) TMI 100 - CESTAT BANGALORE] , where it was held that impugned order holding that the appellant has violated the Condition D of the N/N. 102/2007 dated 14.09.2007 is not sustainable. The appellant is entitled for the refund of Rs. 1,04,111/- which was rejected by the Adjudication Authority on the ground that said amount related to quantity of 56.66 CBM sold after processing - appellant is entitled for the refund of Rs.1,04,111/- after deducting Rs.8,329/- against unsold goods with interest in accordance with law. Appeal allowed in part.

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• 2023 (9) TMI 22
  Scope and validity of the evidence collected from the emails - rejection of declared value on Bill of Entry - re-determination of transaction value - cross-examination of witnesses - demand of differential duty alongwith interest and penalty - HELD THAT:- Rejection of declared value on Bill of Entry is a serious charge and the same could have been rejected on the basis of cogent examination of evidences and justifiable reasons - It is found that the DRI officers conducted search operation in the business premises of M/s Plastic Cottage Trading Co. and M/s Winsor Enterprises. Panchama s both dated 11-4-2017 were prepared in respect of recovery of records/ documents/ files/ print outs of emails and sets of invoices retrieved from emails /computers/ mobile phones and laptop. The issue involved in these cases is mainly confined for determination, as to whether, the transaction values declared by the importer/ appellant are correct or otherwise. The adjudicating authority observed that the evidence for the actual price was retrieved from the E-mails and invoices retrieved from E-mails. The authenticity of all the said Email printouts was admitted by partners of the appellant in their statements. On the other hand, the appellants disputed the veracity and authenticity of the evidences, collected through electronic devices. On reading of Section 138C of the Customs Act, 1962, it is seen that the Legislature had prescribed the detailed procedure to accept the computer printouts and other electronic devices as evidences. It has been stated that any proceedings under the Act, 1962, where it is desired to give a statement in evidence of electronic devices, shall be evidences of any matter stated in the certificate - In the present case, the provisions of Section 138C of the Act were not complied with to use the computer printouts as evidence. It is noted that the certificate was not prepared during the seizure of the electronic devices, as required under the law. In the instant case, it is found that the entire case proceeded on the basis of the electronic documents as evidence. But the investigating officers had not taken pain to comply with the provisions of the law to establish the truthfulness of the documents and merely proceeded on the basis of the statements. Hence, the evidence of electronic devices, as relied upon by the adjudicating authority cannot be accepted. Upon perusal of the judgment of the Hon ble Supreme Court in the case of ANVAR P.V VERSUS P.K. BASHEER AND OTHERS [ 2014 (9) TMI 1007 - SUPREME COURT] , it is noted that the Apex Court has categorically laid down the law that unless the requirement of Section 65B of the Evidence Act is satisfied, such evidence cannot be admitted in any proceedings - Section 138C of the Customs Act is parimateria to Section 65B of the Evidence Act. Consequently, the evidence in the form of computer printouts, etc., recovered during the course of investigation can be admitted in the present proceedings, only subject to the satisfaction of the subsection (2) of Section 138C ibid. The statements cannot be the sole reason to confirm the charge of undervaluation - It is noted that in the present matter there are no evidences produced by the department that the excess amount over and above the invoice price was paid to suppliers. There is no evidence as to how the Appellant came into possession of cash alleged to be differential amount towards goods imported, nor there is any evidence of any cash being handed over to any person, representing suppliers in India. Department had failed to produce corroborative evidences regarding the undervaluation of imported goods. Hence, the charge of undervaluation of imported goods in the present matter is not sustainable. The duty demand confirmed against the appellant M/s. Plastic Cottage Trading Co. and penalties imposed upon it is not sustainable. For the same reason, the penalty imposed on the co-appellants namely, Shri Junaid Kudia and Shri Zaid Kudia is also not sustainable. Therefore, the impugned order confirming the adjudged demands on the appellants is set aside - Appeal allowed.

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• Service Tax

• 2023 (9) TMI 21
  Scope of SCN - Rectification of Mistake Application dismissed in cursory manner without discussing various judgments - Business Auxiliary Services - N/N. 13/2003-ST dated 20.06.2003 - testing services on animals were specifically excluded from the definition of Technical Testing services or not. Whether the Tribunal was right in passing the impugned order beyond the allegations made in the show cause notice both on merits and limitations? - HELD THAT:- In the present proceeding Show Cause Notice dated 15 April, 2009, was issued for the period of 1 July, 2003 to September, 2004 - the Respondent failed to prove that there was suppression on the part of Appellants as during the period from July 2003 to September 2004, the Appellant had claimed exemption under the Notification No. 13/2003. Hence, in the present proceedings, the extended period of limitation as per Section 73(1) proviso could not have been invoked and the demand vide Show Cause Notice dated 15 April 2009, for the period of 1 July 2003 to September 2004 was barred by limitation. Whether the Hon ble Tribunal was right in dismissing the Rectification of Mistake Application in cursory manner without discussing various judgments cited by the Appellant which are squarely applicable to the facts of the present case and without considering written submission filed post hearing? - HELD THAT:- A Division Bench of this Court in Electropneumatics [ 2014 (9) TMI 242 - BOMBAY HIGH COURT] held that minimum expectation from tribunal was complete application of mind to controversy dealing with submissions canvassed orally and in writing and by reasoned order whether to uphold or reject them. The proceedings were remanded back to the tribunal so as grant to the assessee on opportunity to argue its case completely. It was observed that it was not possible to ascertain from tribunal s order as to which of contentions have been dealt with and considered - question answered in favour of Appellant and against the Revenue, as in the order passed on the ROM the CESTAT has not recorded any findings on the position in law as canvassed by the petitioner which had a material bearing on the orders passed by the tribunal. Whether the Tribunal was correct in not considering the decision of the coordinate bench in the case of Chahabria Marketing Ltd. V. Commissioner of Service Tax, Mumbai [ 2016 (3) TMI 1050 - CESTAT MUMBAI] which holds that exemption under Notification No. 13/2003-ST dated 20.06.2003 is available to all services provided under Business Auxiliary Service? - HELD THAT:- In Chahabria Marketing decided by the CESTAT Mumbai it was held that the benefit of exemption was available to all the business auxiliary Services provided by a commission Agent. On behalf of the Revenue, no reason pointed as to why the decision in Chahabria Marketing as referred by the CESTAT in the notification in question, would not be applicable in the appellant s case so as to grant the benefit of the exemption for the period covered by the Show Cause Notice. The tribunal thus has erred in not considering that the issue was covered by the decision of Chahabria Marketing. For such reasons, the Question of Law answered in favour of Appellant, and hold that the exemption benefits as per Notification No. 13/2003, is available to the services provided under Business Auxiliary Services for the period in question. Whether the Tribunal was correct in restricting the scope of exemption under Notification No. 13/2003-ST dated 20.06.2003 to the sub-category of promotion and marketing of Business Auxiliary Services and not the entirety of Business Auxiliary Services ? - HELD THAT:- The notification in question clearly exempts the business auxiliary services provided by a commission agent and such commission agent should cause sale or purchase of goods, on behalf of another person for a consideration which is based on the quantum of such sale or purchase - in view of interpretation of the notification once it is established that the Appellant is a commission agent of Venco/VRB, any service provided to them which falls under the definition of business auxillary services will be exempt from Service Tax prior to 9 July, 2004. Therefore the Appellant is entitled to the benefit of the said notification No. 13/2003 during the period in dispute and therefore the demand is unsustainable. The Supreme Court in Federal Bank [ 2016 (3) TMI 354 - SUPREME COURT] held that Section 65(12) of the Act covers all charging services rendered by banks and hence by express provisions in the same very section, cash management services stood excluded from the purview of service tax. On account of such exclusion the authorities cannot levy service tax by indirect method of charging the same services under the head business auxiliary service . The Tribunal erred in restricting the scope of exemption under Notification No. 13/2003 to promotion and marketing of Business Auxiliary Services . The benefits of notification applies to entire Business Auxiliary Service . Hence, the question of law is answered in favour of Appellant. Whether the Tribunal was correct in holding that services in the nature of veterinary services and Technical Testing services will fall under the taxable category of Business Auxiliary Services when at the relevant point of time the testing services on animals were specifically excluded from the definition of Technical Testing services ? - HELD THAT:- If the main service as Commission agent of providing service of promotion and marketing is exempted, the incidental services in the nature of laboratory testing, analysis and veterinary services ought to be exempted as well. There cannot be a situation where the main service is exempt and all other services in relation to the same are excluded. Appellant carries out various laboratory analysis and tests in respect of the chicks and the services provided by them are in relation to the brooding, growing and laying of birds which includes routine diagnostic services, specialized laboratory examinations, analysis of feed and feed ingredients and water related tests. In the present proceedings the issue is whether Veterinary Services and Pathological laboratory Testing of chicks, will fall into Business Auxiliary Services , therefore, Sub-section (106) of Section 65, cannot be read so as to exclude chicks - It is opined that sub-section (106) of Section 65, would include poultry (chicks) also. Therefore, chicks being animals are specifically carved out of the ambit of Service tax in relation to technical testing and laboratory and analysis services. Services of testing and analysis in relation to animals are clearly excluded from the technical testing and analysis service as defined under Section 65(106) of the Finance Act, and therefore there will be no liability for payment of Service tax on them - A Division Bench of the Punjab Haryana High Court in Dr. Lal Path [ 2007 (9) TMI 26 - HIGH COURT OF PUNJAB HARYANA AT CHANDIGARH] held that the expression Technical Testing and Analysis does not include any testing or analysis service provided in relation to human being or animals. The question answered in favour of Appellant to hold that at relevant time the services in the nature of Veterinary Services and Technical and Laboratory Testing Services did not fall under taxable category of Business Auxiliary Services. Interest and penalty - HELD THAT:- The interest provided under Section 61(2) has no independent or separate existence. When the goods are wholly exempted from the payment of duty on removal from the warehouse, one cannot be saddled with the liability to pay interest on a non-existing duty. Payment of interest under Section 61(2) is solely dependent upon the eligibility or factual liability to pay the principal amount, i.e., the duty on the warehoused goods at the time of delivery. At that time, the principal amount (duty) is not payable due to exemption. So, there is no occasion or basis to levy any interest either. The Appellant hence would also be not liable to pay interest. Also as we have held that Appellant was not liable to pay taxes, during the relevant time, there is no question of imposing penalty u/s. 78 of the Act, as there is no suppression of taxable service provided during the material time. The questions of law are answered in favour of the Appellant, and against the Respondent - Appeal allowed.

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• 2023 (9) TMI 20
  Levy of Service Tax - volume discounts/incentives received from the Media owners at the end of the financial year - HELD THAT:- Service Tax has been discharged on the basis of invoice raised by the media house by the clients/ advertisers on the entire consideration amount and against service commission received by the Respondent from the advertisers, service tax was also discharged but because of large volume of advertisement was facilitated by the Respondent, as a token of gesture/gratitude, media house passed on certain discount/incentives to the Respondent against which Service Tax was already discharged by themselves. Therefore, the said incentive can t be equated with consideration to the activities carried out by the Respondent for the reason that Respondent had not promoted or canvased in placing of advertisement by its client on any specific media house and the choice of media house nested with the clients, for which it can t be considered as any kind of activity against which incentive/discount was received by the Appellant as a consideration, apart from the fact that against placing the order of its client in the print or broadcasting both media house as well as Respondent had discharge their Service Tax liabilities. The only ground on which the Review order is based is on the decision of the CESTAT passed in the case of BBC World (India) Pvt. Ltd. Vs. Commissioner of Service Tax way back in 2009 that is far before introduction of comprehensive taxation scheme in 2012 and that will have so application to the present issue for the reason that for the period pre 2012, the issue had been settled by this Tribunal in several decisions including in Respondent s own case for two different periods and for the period post 2012, even though advanced ruling of the AAR is not a binding precedent and binds only intra parties. Appeal dismissed.

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• 2023 (9) TMI 19
  Classification of services - Manpower Recruitment or Supply Agency Service or otherwise? - appellant s activity of carrying out job of fabrication for their service recipient with the help of the labour of the appellant - HELD THAT:- It is clear that the appellant had been assigned the job of fabrication by the service recipient and the appellant have charged on the quantum of job basis and not on the basis of number of manpower or man hours. Therefore, irrespective of number of manpower or man hours involved in the job to be carried out, the appellant is under obligation to complete a job of fabrication as assigned to him, therefore, in this arrangement it cannot be said that the appellant have provided the service of Manpower Recruitment or Supply Agency Service. As per the arrangement between the appellant and service recipient as evident from the documents the service of the appellant does not fall under the category of Manpower Recruitment or Supply Agency Service however, the same is classifiable under Business Auxiliary service under the sub category of production or processing on behalf of the client. Since demand was not raised under Business Auxiliary service hence, the demand will not sustain for this reason alone. The impugned order is not sustainable, hence, the same is set aside. Appeal is allowed.

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• 2023 (9) TMI 18
  Condonation of delay in filing appeal before the commissioner (appeals) - appeal dismissed for the reason that it was filed beyond the time prescribed under section 85(3) of the Finance Act, 1994 - HELD THAT:- A perusal of sub-section (3A) of Section 85 clearly indicates that an appeal shall be presented within two months from the date of receipt of the order of the adjudicating authority in relation to Service Tax, interest or penalty. It further provides that the Commissioner of Central Excise (Appeals) may, if he is satisfied that the appellant was prevented by sufficient cause from presenting the appeal within the aforesaid period of two months, allow it to be presented within a further period of one month. In the present case, admittedly, the order dated 30.01.2017 of the adjudicating authority was received by the appellant on 06.02.2017, but the appeal was presented before the Commissioner on 27.07.2017. It was clearly not presented within the period of two months nor within the extended period of one month. The Commissioner (Appeals) dismissed the appeal after placing reliance on the decision of Supreme Court in SINGH ENTERPRISES VERSUS COMMISSIONER OF C. EX., JAMSHEDPUR [ 2007 (12) TMI 11 - SUPREME COURT] . The Supreme Court held that the period upto which the prayer for condonation can be accepted is limited by the proviso to sub section (1) of section 35 of the Central Excise Act and the position is crystal clear that the appellate authority has no power to allow the appeal to be presented beyond the period of thirty days after the expiry period of sixty days. In other words, the appellate authority can entertain the appeal by condoning the delay only upto 30 days beyond the normal period for preferring the appeal, which is 60 days. There are no illegality in dismissing the appeal. The present appeal is, accordingly, dismissed.

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• 2023 (9) TMI 17
  Classification of services - commercial training and coaching services - service of training on aircraft maintenance to candidates enrolled with the institute - vocational training institute - N/N. 24/04-ST dated 10.09.2004 - HELD THAT:- During the impugned period the commercial training and coaching services was exempted from payment of service tax by way of Notification No.24/2004-ST dated 10.09.2004 being a vocational training institute. The said issue has been examined by the Hon ble Delhi High Court in the case of M/S INDIAN INSTITUTE OF AIRCRAFT ENGINEERING VERSUS UNION OF INDIA ORS [ 2013 (5) TMI 592 - DELHI HIGH COURT] , wherein the Hon ble High Court has quashed the instruction No.137/132-2010-ST dated 11.05.2011 holding that merely because the certificate issued by the institute does not lead to an employment directly, but another examination is required to be cleared for getting employment, would not lead to the conclusion that the institute imparting such training is not vocational training institute. In this case, the appellant has been issuing certificates after completion of necessary training at their institute to candidates enrolled with them and the said certificates has been approved by DGCA which qualify the candidates to sit for an examination conducted by DGCA to make them eligible to take employment as aircraft maintenance engineers. The appellant s institute is a vocational training institute, therefore, the services rendered by the appellant are exempt from payment of service tax in terms of Notification No.24/2004-ST dated 10.09.2004. The appellant is not liable to pay service tax - the impugned order set aside - appeal allowed.

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• Central Excise

• 2023 (9) TMI 16
  Fraudulent availment of CENVAT Credit - grey fabrics - fake, bogus and non-existent manufacturers - HELD THAT:- Appreciating the facts in the present case indicate that as in the case of the Prayagraj Dyeing Printing Mills Pvt. Ltd. [ 2013 (5) TMI 705 - GUJARAT HIGH COURT] , merely because the manufacturers cannot be found at the present, it cannot make the invoices fake or documents fraudulent in the eye of law. Enough material was placed on record by the petitioner to suggest that the invoices were issued by duly registered manufactures and merely because the manufacturer is not available, does not mean that such manufacture who was registered with the central excise did not exist. Once receipt of goods is not disputed by a person taking credit and necessary invoices are issued, the petitioner is entitled to take credit provided he took reasonable steps to ensure by the inputs or the capital goods in respect of which CENVAT credit is taken were accompanied by the documents. Perusal of the impugned order in light of the show cause notice would indicate that the facts of the case on hand were identical to the case of appeals before the Division Bench in case of Prayagraj Dyeing Printing Mills Pvt. Ltd. [ 2013 (5) TMI 705 - GUJARAT HIGH COURT] and therefore, it was not open for the respondent authority not to give the benefit of such judgement. Petition allowed.

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• 2023 (9) TMI 15
  Refund of amount paid under protest - SCN not adjudicated for more than 25 years - HELD THAT:- The decision of the Division Bench of this Court in PREMIER LTD. (FORMERLY KNOWN AS THE PREMIER AUTOMOBILES LTD.) , MAITREYA V. DOSHI VERSUS THE UNION OF INDIA, THE COMMISSIONER OF CENTRAL EXCISE, THE ASSISTANT COMMISSIONER OF CENTRAL EXCISE [ 2017 (2) TMI 981 - BOMBAY HIGH COURT] wherein in similar circumstances a Division Bench of this Court, being confronted with a similar issue pertaining to the belated adjudication of a show cause notice issued 25 years back, observed that failure of the adjudicating authority to adjudicate upon the same, for about 25 years, itself would be illegal, and that the authorities could not have been liberal in granting adjournment and not adjudicating the show cause notice for such a long lapse of time. The Respondents are directed to refund to the Petitioner INR 10,69,666/- deposited by the Petitioner under protest during the course of the investigation with interest at the rate 12 per cent per annum from the date of deposit till the date of actual refund - petition allowed.

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• 2023 (9) TMI 14
  Denial of CENVAT Credit - adjustment/deduction the excise duty paid by the petitioners through utilizing Cenvat Credit at the time of investigation - Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 - HELD THAT:- The only ground taken by the respondents in the written statment that the benefit of Cenvat Credit cannot be given for adjustment as per Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 (annexure P-3) on the ground that this issue has to be decided by the adjudicating authority, is not correct and the same is rejected. As per above said judgments, this benefit cannot be denied on the ground that the period of limitation of one year has gone by, as under the benefit under Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 (annexure P-3), any amount deposited during enquiry has to be adjusted. Hence, the petition filed by the present petitioners deserves to be allowed. The impugned SVLDRS-2 (Annexure P-12), SVLDRS-3 (Annexure P-16) issued by respondent No.2 and letter dated 23.06.2017 (Annexure P-2) are set aside - appeal allowed.

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• 2023 (9) TMI 13
  Condonation of delay of 1488 days in filing appeal - appeal dismissed on the ground of time limitation - HELD THAT:- The similar issue had arisen in an appeal COMMISSIONER OF CGST AND COMMISSIONER OF CENTRAL EXCISE, (J K) JAMMU VERSUS M/S NARBADA INDUSTRIES [ 2022 (5) TMI 1361 - JAMMU KASHMIR HIGH COURT] , wherein also the appellant/applicant had sought condonation of delay on similar grounds as have been urged in this application but the Division Bench of this Court did not accept the application and dismissed the appeal as barred by limitation. It is also submitted that the Supreme Court has also considered the matter in COMMISSIONER OF CGST AND CENTRAL EXCISE (J AND K) VERSUS M/S. SARASWATI AGRO CHEMICALS PVT. LTD. [ 2023 (7) TMI 542 - SC ORDER] and dismissed the SLP. Thus appeal is dismissed.

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• 2023 (9) TMI 12
  CENVAT Credit - common inputs used in the manufacture of both dutiable and exempted goods - maintenance of separate accounts - reversal of proportionate cenvat credit of the inputs used for exempted goods - Chartered Accountant s Certificate submitted by the respondents was not supported by any documentary evidences and no verification of correctness of the facts in the Chartered Accountant s Certificate was done by the adjudicating authority - unjust enrichment. HELD THAT:- In terms of the amendment brought in Sections 68 to 72 of the Finance Act, 2010, wherein it is clear that if the proportionate cenvat credit of inputs or input services attributable to exempted final product is reversed along with the payment of interest within a period of six months from the assent of the Hon ble President to the Finance Bill, 2010 and the Certificate to that effect is produced by the respondents, it is established that no proceedings will be sustainable against the respondents and the adjudicating authority in his order has examined the issue and after examining the issue, which was supported by the Certificate issued by the Chartered Accountant certifying that the respondents have reversed the proportionate cenvat credit attributable of input or input services to the final products and the interest due has been paid. There are no infirmity with the impugned order and accordingly, the same is upheld - the appeals filed by the Revenue are dismissed.

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• 2023 (9) TMI 11
  Reversal of cenvat credit - credit attributable to exempted goods - SSI exemption - goods manufactured without brand name - clearing the goods on payment of Central Excise duty on the branded product namely ACE brand fire bricks - applicability of N/N. 8/2003-CE dated 01.03.2003, as amended - HELD THAT:- The appellant has already reversed the Cenvat credit availed by them before the matter came to be adjudicated - It is also found that appellant have submitted Chartered Accountant certificate dated 30.01.2010 wherein a month wise break-up of common inputs reversed by them has been given. The department has not verified this fact and has simply proceeded in confirming the duty at the rate 8%/ 10% of the value of exempted goods, which we find that as per various legal pronouncements, is not sustainable. Since the Hon ble Supreme Court in the case of CHANDRAPUR MAGNET WIRES (P) LTD. VERSUS COLLECTOR OF C. EXCISE, NAGPUR [ 1995 (12) TMI 72 - SUPREME COURT] has held that once the Cenvat credit availed by the assessee has been reversed, it can be held that assessee has not taken credit of the duty on inputs utilized in exempted final products. The impugned order-in-original is without any merit and hence the same is set-aside. The appeal is allowed.

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• 2023 (9) TMI 10
  Valuation - inclusion in the assessable value or not - forwarding and freight charges collected by the appellant from their customers while clearing/selling excisable goods on payment of duty - interpretation of provision of Section 4 of Central Excise Act - HELD THAT:- The issue on merit is whether the forwarding and freight charges collected by the appellant from their customer should be included in transaction value for the purpose of charging excise duty - In an identical issue in the appellant own case earlier has come up before this Tribunal in TRANSASIA BIO-MEDICALS LTD. VERSUS COMMISSIONER OF C. EX., DAMAN [ 2012 (1) TMI 123 - CESTAT AHMEDABAD] wherein this Tribunal has set aside the demand on the ground of time bar. In the present case also somewhat the identical issue involve i.e. duty liability on forwarding and freight charges collected from the customer. In the present case the Show cause notice was issued subsequent to the period involved in the aforesaid tribunal decision. In these facts, as per the law settled by the Hon ble Supreme Court in the case of NIZAM SUGAR FACTORY VERSUS COLLECTOR OF CENTRAL EXCISE, AP [ 2006 (4) TMI 127 - SUPREME COURT] the demand for the subsequent period will not sustain on the ground of time bar. Allegation of suppression of facts against the appellant cannot be sustained. When the first SCN was issued all the relevant facts were in the knowledge of the authorities. Later on, while issuing the second and third show cause notices the same/similar facts could not be taken as suppression of facts on the part of the assessee as these facts were already in the knowledge of the authorities. The demand in the present case also is hopelessly time barred. Accordingly, the demand is set aside on the ground of limitation itself. The impugned order is set aside. Appeal is allowed.

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• 2023 (9) TMI 9
  Deduction of interest on receivables from the assessable value - HELD THAT:- The interest on receivables has been deducted on the basis of the purchase orders and invoices wherein it is clearly mentioned that the interest on receivables is on account of credit period and interest for the credit period is inbuilt in the price. This issue has been considered by various benches of the Tribunal and it has been consistently held that interest on receivables is admissible to the assessee even when the interest is inbuilt in the price in invoice. It is also found that the department cannot demand duty arising due to accounting treatment adopted by the appellant as held in the case of FIRM FOUNDATIONS HOUSING PVT. LTD. VERSUS PRINCIPAL COMMISSIONER, OFFICE OF THE PRINCIPAL COMMISSIONER OF SERVICE TAX [ 2018 (4) TMI 613 - MADRAS HIGH COURT] wherein the Hon ble High Court set-aside the demand of service tax computed on the basis of profit loss account and held that it is irrelevant for the purposes of determination of service tax payable. When the demand of tax itself is not sustainable, the demand for interest and penalty is not justified. The impugned order is not sustainable - Appeal allowed.

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• 2023 (9) TMI 8
  SSI Exemption - supply of impugned goods to various public sector customers as per their purchase orders - non-inclusion of packaging and forwarding charges separately shown in the invoice, in the assessable value - interest - penalty - suppression of facts - extended period of limitation - HELD THAT:- In the SCN, there was no proposal for imposition of penalty under Section 11AC but when the Order-in-Original was passed even the equal penalty under Section 11AC was imposed which is beyond the show cause notice, hence, not sustainable in law. Further, it is found that the show cause notice was issued on 09.11.2010 which was received by the appellant on 16.11.2010 for the period pertaining to 2007-08 by invoking the extended period of limitation without the ingredients present as required under Section 11A(4). Further, it is found that the appellant has regularly been filing the ER-1 returns which was scrutinized by the department and the department never raised the objection regarding the irregularity committed by the appellant. Further, department has not been able to bring on record anything to show that the appellant has suppressed the material fact in order to evade the payment of duty. The entire demand is barred by limitation - the impugned order is set aside - appeal allowed.

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• 2023 (9) TMI 7
  Levy of NCCD - Claim barred by time limitation or not - HELD THAT:- The respondent filed an appeal before the Commissioner (Appeals) which appeal has been allowed in part by the impugned order in view of the decision of the Supreme Court in BAJAJ AUTO LIMITED VERSUS UNION OF INDIA OTHERS [ 2019 (3) TMI 1427 - SUPREME COURT] where it was held that Once the excise duty is exempted, NCCD, levied as an excise duty cannot partake a different character and, thus, would be entitled to the benefit of the exemption notification. As the decision of the Commissioner (Appeals) is based solely on the decision rendered by the Supreme Court in Bajaj Auto, has been held to be per incuriam and the Supreme Court has held that simply because one kind of duty is exempted, other kinds of duties automatically fall cannot be accepted. Therefore, NCCD shall continue to be levied despite the Notification exempting the payment of excise duty. The impugned order dated November 15, 2019 passed by the Commissioner (Appeals), therefore, cannot be sustained and is set aside - appeal allowed.

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• 2023 (9) TMI 6
  Refund claim - amount paid under a mistaken interpretation - applicability of N/N. 12/2012 CX dated 17/03/2012 - HELD THAT:- From the Notification, it is clear that the it has been issued in respect of manufacturer of the goods. In case the manufacturer wants to clear the coal on concessional rate @1%, he is not eligible to take the Cenvat Credit of input and inputs services. The Department is error in applying this Notification to the appellant who is the receiver of the goods. The very issue was before the Tribunals in the case of M/S HINDALCO INDUSTRIES LTD. VERSUS GST, BHOPAL [ 2018 (3) TMI 1124 - CESTAT, NEW DELHI] , the Tribunal has held the appellant has correctly availed the Cenvat credit of CVD paid on imported coal in terms of Rule 3(7) of Cenvat Credit Rules, 2004. Appeal allowed.

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• 2023 (9) TMI 5
  Refund of excise duty payable on value addition - Area based exemption - Contravention of N/N. 20/2007, as amended - Effect of the notification which was quashed by the high court - irregular availment and utilization of credit of tax paid on clearance of waste and scrap - HELD THAT:- The Ld. Commissioner had rejected the Appellant s application for fixation of special value addition rate and confirmed the demands, on the basis that the Appellant had foregone the option to seek special value addition and thus, they are only eligible for refund upto 56% of the value addition rate as mentioned in para 2A of the Notification No. 20/2007-CE (as amended). Hence, re-credit of duty in excess of 56% of value addition is liable to be recovered from them. The Appellant stated that in the said applications they have clearly indicated that they would have applied for fixation of special value addition rate, if the relevant Notification was in place at that point of time. Therefore, in terms of the Hon ble Supreme Court order in UNION OF INDIA AND ANR. ETC. VERSUS M/S V.V.F. LTD. AND ANOTHER ETC. ETC. [ 2020 (4) TMI 885 - SC ORDER] , which had an effect of reinstating the amended notification, the Appellant vide its letter dated 24.08.2020 requested for fixation of special value addition rate for the FYs 2010-11, 2011-12 and 2012-13 in terms of the workings submitted earlier. It is observed that the rejection of the Applications filed by the Appellant for Special rate fixation on the ground that they have foregone such option, is legally not tenable - the impugned order is liable to be set aside and the matter is remanded back to the Commissioner to decide the request for special rate fixation applications of the Appellant on merit - appeal allowed by way of remand.

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• CST, VAT & Sales Tax

• 2023 (9) TMI 4
  Penalty order - illegal detention of goods - demand of security deposit under Section 47(2) of the KVAT Act - HELD THAT:- From a perusal of clause (h) of Sub-section (1) of Section 67, it would be evident that if the vehicle had been asked to be stopped, but it has not stopped, it would constitute an offence for which twice the amount tax is to be levied as a penalty under Sub-section (2) of Section 67. The Explanation to Sub-section (2) of Section 67 provides the burden of proving that any person is not liable to the penalty under Sub-section (1) shall be on such person. This Court does not find any ground to interfere with the order insofar as it relates to the imposition of penalty under Subsection (2) of Section 67; however, concerning the demand for a security deposit of Rs. 1,38,352/-, thus no security could have been directed to be deposited by the petitioner inasmuch as the goods were not detained which were required to be released after seizure and therefore, the impugned order directing the petitioner to deposit a security deposit of Rs. 1,38,352/- is set aside. The petitioner has not deposited the penalty amount of Rs. 1,38,352/-; the Department is entitled to recover the said amount along with the applicable interest as arrears. Petition allowed in part.

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• 2023 (9) TMI 3
  Violation of principles of natural justice - entitlement to exemptions as per SRO 246 of 1998 dated 20.08.1998 - invocation of suo moto powers of revision under Section 12 of the GST Act, 1962 - HELD THAT:- The court being satisfied that the impugned order has been passed by the respondent in violation of the principle of natural justice, the petitioner having not been heard the petition is required to be allowed on that score alone. The petitioner has challenged the order of the respondent No. 2, impugned in the present petition, on various other grounds, which also relate to the competency of the said respondent to invoke the revisional powers under the GST Act and the period within which it could be exercised qua the proceedings which came to be initiated against the petitioner - the Court is of the view that as these grounds are required to be decided qua the other facts that have emerged in the proceedings it is in the fitness of things that the petitioner should take all these pleas which he has taken in the present petition and also urged before the court to take the same before the respondent No. 2 who had passed the impugned order. Petition allowed by way of remand.

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• 2023 (9) TMI 2
  Validity of assessment order - inspection was contrary to authorization under Section 67(1) of the CGST Act, 2017 or not - HELD THAT:- The petitioner having failed to respond to the notice cannot challenge the impugned order either before the Appellate Commissioner after limitation or before this Court long after the limitation. Before the Appellate Authority the appeal would be time barred and before this Court, the writ petition is liable to be dismissed on account of latches. The Hon ble Supreme Court recently in Assistant Commissioner (CT) LTU, Kakinada and others Vs. Glaxo Smith Kline Consumer Health Care Limited [ 2020 (5) TMI 149 - SUPREME COURT] has held that High Courts cannot entertain writ petition against assessment orders beyond the period of statutory period - As per the decision of the Hon ble Supreme Court in Glaxo Smith Kline Consumer Health Care Limited case [ 2020 (5) TMI 149 - SUPREME COURT] , a writ petition beyond the statutory period of limitation is liable to be dismissed. There are no hesitation in taking the view that what this Court cannot do in exercise of its plenary powers under Article 142 of the Constitution, it is unfathomable as to how the High Court can take a different approach - The principle underlying the rejection of such argument by this Court would apply on all fours to the exercise of power by the High Court under Article 226 of the Constitution. There is no case made out for interfering with the Impugned Assessment Order - petition dismissed.

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• 2023 (9) TMI 1
  Quantum of Levy of penalty - Liability of revision petitioner to pay the due tax with penalty - motor spare parts which had been given away by the revision petitioner - HELD THAT:- In view of the legislative change that has taken place by reducing the volume of the penalty and keeping in consideration of the peculiar facts and circumstances of this case, the penalty reduced from 200% to 100%, but this will not create any precedent for any other case, in as much as, no principle laid down to be applied generally. The revision petitioner is directed to pay the tax and the penalty within a period of two months from today - the revision petition stands disposed of.

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