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GST - Taxability of actionable claims arising from betting and gambling - Constitutionally validity of provisions of the CGST Act, 2017, including Sections 2(31), 2(52), 7, 9 and 15, and the Rules framed thereunder, insofar as they subject actionable claims arising from betting and gambling to GST - Whether actionable claims arising from betting and gambling fall within the ambit of "goods" and constitute taxable supplies under the statutory framework embodied in Sections 2(1), 2(31), 2(52), 7, 9 and Entry 6 of Schedule III of the CGST Act, and whether the inclusion of actionable claims within the definition of "goods" und... [Read more]

GST - Taxability of actionable claims arising from betting and gambling - Constitutionally validity of provisions of the CGST Act, 2017, including Sections 2(31), 2(52), 7, 9 and 15, and the Rules framed thereunder, insofar as they subject actionable claims arising from betting and gambling to GST - Whether actionable claims arising from betting and gambling fall within the ambit of "goods" and constitute taxable supplies under the statutory framework embodied in Sections 2(1), 2(31), 2(52), 7, 9 and Entry 6 of Schedule III of the CGST Act, and whether the inclusion of actionable claims within the definition of "goods" under Section 2(52) is constitutionally and statutorily valid – HELD – The levy of GST on actionable claims arising from betting and gambling transactions is constitutionally valid, within the legislative competence conferred by Article 246A of the Constitution, and consistent with the statutory framework embodied in the CGST Act, 2017 and the corresponding State GST enactments - The challenge to the constitutional and statutory validity of Sections 2(31), 2(52), 7, 9 and 15 of the CGST Act, 2017, the corresponding provisions of the State GST enactments, and Rules 31A and 31B of the CGST Rules, 2017, together with the notifications, circulars and executive instruments issued in furtherance thereof, fails and is accordingly rejected - The amendments introduced by the CGST (Amendment) Act, 2023, including the amendments to Entry 6 of Schedule III and insertion of Rules 31B and 31C, are clarificatory and explanatory in nature and shall operate retrospectively in the manner indicated hereinabove - Organised online gaming activities, including fantasy sports and analogous gaming formats involving pooled stakes, give rise to actionable-claim supplies exigible to GST under the statutory framework governing betting and gambling transactions - Insofar as casino transactions are concerned, recourse to Rule 31 and adoption of best judgment methodologies under the pre-amendment framework cannot be said to be impermissible in the absence of complete and reliable contemporaneous records. However, the ultimate determination and computation of taxable value shall stand governed by Rule 31C – The petitions are disposed of [Read less]

Service Tax - Supply of Tangible Goods Service - Classification of trailer hiring services - Whether hiring of trailers with crew and equipment, where possession and effective control remain with service provider, constitutes supply of tangible goods service under Section 65(105)(zzzzj) of Finance Act, 1994 or GTA service – HELD - The essential ingredients for attracting the definition of taxable service under Section 65(105)(zzzzj) are: provision of service by one person to another in relation to supply of tangible goods including machinery, equipment and appliances, with no transfer of right of possession, effective co... [Read more]

Service Tax - Supply of Tangible Goods Service - Classification of trailer hiring services - Whether hiring of trailers with crew and equipment, where possession and effective control remain with service provider, constitutes supply of tangible goods service under Section 65(105)(zzzzj) of Finance Act, 1994 or GTA service – HELD - The essential ingredients for attracting the definition of taxable service under Section 65(105)(zzzzj) are: provision of service by one person to another in relation to supply of tangible goods including machinery, equipment and appliances, with no transfer of right of possession, effective control continuing with service provider, and goods supplied for use by recipient. The term "use" does not require physical operation or technical expertise but signifies application of goods for the purpose for which they are supplied under contract terms. The work orders examined establish that the service provider supplied trailers on hire charge basis inclusive of fuel, crew, and accommodation, with service provider responsible for insurance, maintenance, repairs, crew compensation, and health and safety compliance, retaining comprehensive control over equipment throughout contract period. This constitutes license to use goods without transfer of right to use, falling within Section 65(105)(zzzzj) – The Section 65(105)(zzzzj) was enacted precisely to levy service tax on such “licence to use” that goes in tandem with the tangible goods supplied, where right of possession and effective control are not transferred to the service recipient. The Adjudicating Authority's findings that services are classifiable as supply of tangible goods service and not goods transport agency service are upheld, as requirement of consignment note under Rule 4B is not applicable where possession and control are retained by service provider. The terminology of "hire charges" versus "freight charges" in balance sheet does not alter actual nature of service when work orders clearly indicate hiring of equipment on lump sum basis without transfer of possession or control - the appellant are covered under “Supply of Tangible Goods services”, the reliance placed by the appellant on the decisions in support of its contention that it is covered under GTA service inapplicable and distinguishable - While the appellant is entitled to cum-tax benefit as well as computation of cenvat credit entitlement, it needs to be verified whether the liability has been correctly discharged - The appeal is disposed of by remandrnrnDemand invoking the extended period of limitation – HELD – The ST-3 returns were filed erratically and that too indicating partial discharge of liability is not controverted. There is no claim of bonafides nor even a plea that the liability has been declared in the ST-3 returns correctly, though discharged partly, to show that there was no intent to evade payment of service tax. Concededly the ST-3 returns itself have not been filed for the entire disputed period, save for 2012-13. There has been no contest to the findings of the Adjudicating Authority regarding invoking the extended period of limitation either in the reply of the appellant or in the grounds of the appeal preferred before us. In these circumstances, there is no substance in the claim that it was only issues of interpretation and that therefore the extended period of limitation cannot be invoked. Therefore, no reason to interdict the findings of the Adjudicating Authority on this aspect of invoking extended period of limitation - While the appellant is entitled to cum-tax benefit as well as computation of cenvat credit entitlement without invoking the bar prescribed in Rule 4(1), it needs to be verified whether the liability has been correctly discharged. [Read less]

Customs - Classification of 5G Radio Unit Device – Respondent-importer imported Airspan Air Velocity 2700 device and declared it under Customs Tariff Heading 8517 6260 (Synchronous Digital Hierarchy System - SDH) - Adjudication authority reclassified the goods under 8517 6290 (others), rejecting the original classification - Whether the Air Velocity 2700 device should be classified under Customs Tariff Heading 8517 6260 (SDH equipment) or 8517 6290 (other machines for reception, conversion and transmission of data) - HELD – From the technical specifications and functional characteristics of the device it is found that... [Read more]

Customs - Classification of 5G Radio Unit Device – Respondent-importer imported Airspan Air Velocity 2700 device and declared it under Customs Tariff Heading 8517 6260 (Synchronous Digital Hierarchy System - SDH) - Adjudication authority reclassified the goods under 8517 6290 (others), rejecting the original classification - Whether the Air Velocity 2700 device should be classified under Customs Tariff Heading 8517 6260 (SDH equipment) or 8517 6290 (other machines for reception, conversion and transmission of data) - HELD – From the technical specifications and functional characteristics of the device it is found that the Air Velocity 2700 is a 5G Radio Unit (RU) designed for 5G Radio Access Networks, functioning as a router that receives signals from the tower, synchronizes them, and routes them through enclosed areas to enhance 5G network efficiency. Though the device processes synchronization signals as part of its operational protocol, its essential character and primary function are that of a routing device within a wireless access network rather than a traditional SDH fiber optic transmission equipment - The goods must be classified based on their essential character and primary function as contemplated in the classification rules. The Commissioner (Appeals) order setting aside the reclassification is upheld and the Revenue appeal is dismissed [Read less]

Service Tax - CENVAT credit - Defective invoices lacking mandatory particulars - Whether CENVAT credit can be availed on invoices that do not contain all the mandatory particulars prescribed under Rule 4A of the Service Tax Rules, 1994 and Rule 9 of the CENVAT Credit Rules, 2004 – HELD - The Rule 9(2) of the CENVAT Credit Rules, 2004 divides the particulars in an input credit document into a core area comprising duty or service tax payable, description of goods or taxable service, assessable value, service tax registration number of the person issuing the invoice, and name and address of the provider of output service, a... [Read more]

Service Tax - CENVAT credit - Defective invoices lacking mandatory particulars - Whether CENVAT credit can be availed on invoices that do not contain all the mandatory particulars prescribed under Rule 4A of the Service Tax Rules, 1994 and Rule 9 of the CENVAT Credit Rules, 2004 – HELD - The Rule 9(2) of the CENVAT Credit Rules, 2004 divides the particulars in an input credit document into a core area comprising duty or service tax payable, description of goods or taxable service, assessable value, service tax registration number of the person issuing the invoice, and name and address of the provider of output service, and a penumbra area comprising all other details. The particulars in the core area are foundational and mandatory in nature. The discretionary jurisdiction of the proper officer is confined to the penumbra area. The burden of proof regarding the admissibility of CENVAT credit lies squarely upon the service provider claiming such credit under Rule 9(5) and (6) - The service provider cannot circumvent the statutory burden merely by producing defective invoices along with proof of payment. Where the statute prescribes that an act must be done in a particular manner and provides consequences of non-compliance, the requirement is mandatory. Therefore, demonstrating the integrity of the core area particulars of the input credit document is mandatory and beyond the subjective or discretionary jurisdiction of the proper officer - The demand pertaining to invoices lacking mandatory particulars was set aside and remanded for fresh adjudication with an opportunity to the appellant to submit all documents for verification – The appeal is disposed ofrnrnEligibility of input services - Nexus between input and output service - Whether services such as civil works for renovation, vehicle hire and repair, sales promotion, membership fees, water and food testing, public performance licence, and insurance of company-owned vehicles constitute eligible input services with real and sufficient nexus to the output service of club or association, tour operations, and related taxable services, particularly after the amendment to Rule 2(l) of the CENVAT Credit Rules, 2004 effective from 01.04.2011 which deleted the phrase "activities relating to business" – HELD - These input services are eligible for credit as they have a real and sufficient nexus with the assessee's output service and are not for personal use or consumption of employees. The definition of input service under Rule 2(l) of the CENVAT Credit Rules, 2004, even after the deletion of the phrase "activities relating to business" effective from 01.04.2011, allows credit where the service satisfies the "means" part of the definition by having a real and sufficient nexus with the assessee's output service. The test is functional and commercial nexus, not rigid direct one-to-one correlation between input and output service. Civil works used in modernization, renovation or repairs of factory or premises of provider of output service are specifically covered in the inclusive part of the definition as clarified by Board Circular. Vehicle hire and repair services used for taxable output services and not for personal use of employees are eligible. Services relating to advertisement, sales promotion, market research are included in the definition of input service. Membership fees provided by industry or business associations are not for personal consumption. Water and food testing and public performance licence are statutory or business necessities integral to hospitality services. Insurance of company-owned vehicles, where such vehicles are capital goods, falls outside the exclusion under Rule 2(l). All these services are consumed or used in relation to the output service and have a functional connection to the business activities, thus qualifying as eligible input services - The demand regarding denial of credit on these input services was set aside and credit was allowed as the services are eligible input services with real and sufficient nexus to the output service.rnrnShow Cause Notice - Whether the adjudicating authority can confirm demands and impose penalties on disputed services that were not specifically averred or detailed in the Show Cause Notice and whether the authority can go beyond the scope of the Show Cause Notice – HELD - The adjudicating authority cannot travel beyond or outside the scope of the Show Cause Notice. The principle established in Commissioner versus Toyo Engineering India Limited that the department cannot traverse beyond the show cause notice is a cardinal principle in tax adjudication. The Show Cause Notice forms the foundation of adjudication and must contain clear, evidence-based allegations. Any demand confirmed in the adjudication order must find support or clear averment in the corresponding Show Cause Notice. When the adjudicating authority confirms demands on services not specifically mentioned or detailed in the Show Cause Notice, it violates the principle of natural justice and the procedural requirements governing tax adjudication. This ensures that the assessee has a fair opportunity to respond to the specific allegations made in the notice and cannot be taken by surprise by new or additional grounds introduced during adjudication - Demands confirmed regarding courier charges, bank charges, telecommunication charges, and consultancy services without specific averment in the Show Cause Notice are set aside. [Read less]

Central Excise - Invocation of Extended Period of Limitation, Suppression with intent to evade duty - Whether the extended period of limitation under Section 11A(4) of the Central Excise Act, 1944 can be validly invoked when the Show Cause Notice is issued beyond three years from the date of discovery – HELD - The department was aware of the matter from the date of visit (12.02.2013) or at least from the date of deposit (07.03.2013), yet the Show Cause Notice came only on 26.04.2016, clearly beyond the period of limitation. The allegation of suppression with intention to evade duty is untenable since the adjudicating aut... [Read more]

Central Excise - Invocation of Extended Period of Limitation, Suppression with intent to evade duty - Whether the extended period of limitation under Section 11A(4) of the Central Excise Act, 1944 can be validly invoked when the Show Cause Notice is issued beyond three years from the date of discovery – HELD - The department was aware of the matter from the date of visit (12.02.2013) or at least from the date of deposit (07.03.2013), yet the Show Cause Notice came only on 26.04.2016, clearly beyond the period of limitation. The allegation of suppression with intention to evade duty is untenable since the adjudicating authority itself recorded that the assessee was paying central excise duty in its periodical returns, which amounts to a tacit admission and disproves any intention to evade. Furthermore, for the disputed period of 01.04.2011 to 31.03.2013, the assessee enjoyed the benefit of Small Scale Industries exemption. The tribunal also observes that the impugned appellate order is cryptic and non-speaking, mechanically confirming penalties without justifiable reasons, and the original Show Cause Notice contained no proposal to levy penalty under Rule 26 - The extended period of limitation is found to be unjustified, and consequently, the demand, interest, and penalty are not sustainable. The assessee succeeds on the ground of limitation itself [Read less]

Customs - Classification of kitchen and household items - Appellant imported various items including baskets, racks, bottle holders, plate racks, drawer systems, carousel units, and similar products designed for use in modular kitchen furniture and wardrobes – Appellant classified the items under Customs Tariff Headings 7323, 8302, and 7615, the Department subsequently reclassified all items under CTH 9403 90 00 (other furniture and parts thereof) - Whether products such as baskets, racks, holders, and drawer systems designed to be fixed within modular kitchen or wardrobe furniture should be classified under Chapter 73 (... [Read more]

Customs - Classification of kitchen and household items - Appellant imported various items including baskets, racks, bottle holders, plate racks, drawer systems, carousel units, and similar products designed for use in modular kitchen furniture and wardrobes – Appellant classified the items under Customs Tariff Headings 7323, 8302, and 7615, the Department subsequently reclassified all items under CTH 9403 90 00 (other furniture and parts thereof) - Whether products such as baskets, racks, holders, and drawer systems designed to be fixed within modular kitchen or wardrobe furniture should be classified under Chapter 73 (kitchen and household articles), Chapter 83 (base metal mountings and fittings), or Chapter 94 (furniture and parts thereof) under the Customs Tariff – HELD - While the products may be fixed within larger furniture assemblies, they retain their essential character as kitchen and household articles or as base metal mountings and fittings suitable for furniture. The Rule 3(a) of GRI provides that headings offering the most specific description must be preferred over those providing general descriptions. Chapter 73 specifically covers kitchen and household articles of iron or steel, while Chapter 83 specifically covers base metal mountings and fittings suitable for furniture. Chapter 94, by contrast, provides a general description covering furniture and parts thereof not covered by previous headings - The Tribunal in case of Commissioner of Central Excise, Surat-I versus Crystal Interior Products, held that kitchen and household articles cannot, by any stretch of imagination, be considered as furniture items, and that such articles must be classified according to their actual usage and common trade parlance - The goods possess distinct identities and individual functions independent of their ultimate placement within furniture units, and that identical products are being cleared by other importers under Chapter 73 in current practice, demonstrating consistent trade classification. The Department had not raised any classification objections during the prior many years of imports by the appellant, and the duty demand arose only after the duty rate was increased from 10% to 20% in February 2018, suggesting the objection was motivated by revenue considerations rather than genuine classification concerns – The impugned order classifying the goods under CTI 9403 90 00 is set aside and the original classification under CTH 7323/8302 is restored – The appeal is allowed [Read less]

GST – Gujarat AAR - Classification and exemption to Fresh Psyllium Seeds, Agricultural Produce - Whether psyllium seeds supplied in their natural, raw and unprocessed form as procured through APMC auctions directly from farmers, without undergoing any drying, freezing, crushing or other processing, qualify as fresh isabgol seeds and are exempted under Entry 87 (HSN 1211) of Notification No. 10/2025-Central Tax (Rate) dated 17.09.2025 – HELD - The fresh agricultural produce refers to raw, unprocessed food items derived from farming that have not been dried, frozen, or heavily processed and remain in the same state as ha... [Read more]

GST – Gujarat AAR - Classification and exemption to Fresh Psyllium Seeds, Agricultural Produce - Whether psyllium seeds supplied in their natural, raw and unprocessed form as procured through APMC auctions directly from farmers, without undergoing any drying, freezing, crushing or other processing, qualify as fresh isabgol seeds and are exempted under Entry 87 (HSN 1211) of Notification No. 10/2025-Central Tax (Rate) dated 17.09.2025 – HELD - The fresh agricultural produce refers to raw, unprocessed food items derived from farming that have not been dried, frozen, or heavily processed and remain in the same state as harvested. Applying the principles enunciated in Circular No. 169/19/2021-GST dated 06.10.2021, the psyllium seeds obtained through APMC auction mechanism on which no artificial or intentional drying, dehydration, freezing, or processing of any kind is undertaken, and which are supplied to processing units in their natural form without any change or alteration from the stage of procurement, satisfy the definition of fresh produce - The product is classifiable under Sub-heading 1211 9013 of the Customs Tariff Act as psyllium seeds are explicitly mentioned in the HSN notes to heading 1211. Since the seeds are plants or parts of plants (seeds) used primarily in pharmacy for the production of isabgol and are supplied in fresh condition, they fall squarely within the ambit of Entry 87 of Notification No. 10/2025-Central Tax (Rate), which provides exemption for plants and parts of plants used primarily in pharmacy when supplied in fresh or chilled condition - The Psyllium seeds supplied in natural, raw and unprocessed form as procured through APMC auctions directly from farmers, without undergoing any drying, freezing, crushing or other processing, are exempted from GST under Entry 87 (HSN 1211) of Notification No. 10/2025-Central Tax (Rate) dated 17.09.2025 and are liable to Nil GST – Ordered accordingly [Read less]

Customs - Valuation - Rejection of Transaction Value – Appellant-Importer of apples declared values ranging from USD 10.5 to USD 12 per carton, and the Department alleged undervaluation by arranging two sets of invoices, supported by e-mails, parallel invoices, insurance documents and overseas verification - Whether rejection of declared transaction value under Section 14 of the Customs Act relying upon unsigned parallel invoices, overseas verification reports, e-mails, insurance documents and retracted statements is legally sustainable – HELD - The transaction value is the primary basis of valuation and can be rejecte... [Read more]

Customs - Valuation - Rejection of Transaction Value – Appellant-Importer of apples declared values ranging from USD 10.5 to USD 12 per carton, and the Department alleged undervaluation by arranging two sets of invoices, supported by e-mails, parallel invoices, insurance documents and overseas verification - Whether rejection of declared transaction value under Section 14 of the Customs Act relying upon unsigned parallel invoices, overseas verification reports, e-mails, insurance documents and retracted statements is legally sustainable – HELD - The transaction value is the primary basis of valuation and can be rejected only upon the existence of cogent and legally admissible evidence demonstrating that the declared price is not the price actually paid or payable. The alleged parallel invoices are unsigned computer-generated documents whose origin and authenticity remain unestablished, with no witness examined to prove these documents and no cross-examination afforded to the appellants. Overseas verification reports are selective, lack correlation with specific consignments and have not been subjected to cross-examination, constituting violation of principles of natural justice. Insurance values cannot be equated with transaction value, and e-mails remain unauthenticated and uncorroborated - The Department failed to establish any financial flowback or additional consideration, with no evidence of advance payments, parallel remittances or money trail. The allegation of additional payment rests only on statements subsequently retracted and uncorroborated. In valuation matters, suspicion, however strong, cannot take the place of proof, and absence of evidence of actual payment or financial flowback necessitates acceptance of declared transaction value - The enhancement based on unsigned parallel invoices, uncorroborated overseas data and retracted statements is unsustainable – The appeal is allowedrnrnCustoms - Whether revaluation of goods, demand of differential duty, confiscation of goods and imposition of penalties including penalty on alleged abettors are sustainable when transaction value rejection fails – HELD - When the primary basis for rejecting transaction value fails, the foundation of revaluation under Customs Valuation Rules collapses, as revaluation is merely a consequential exercise incapable of surviving independently. The adjudicating authority has not adhered to mandatory sequential application of Valuation Rules and produced no reliable evidence of contemporaneous imports at higher values, rendering revaluation legally untenable. Confiscation under Section 111(m) requires proof of misdeclaration of value, which necessarily presupposes incorrect declared value, but failure to establish undervaluation through admissible evidence defeats the charge of misdeclaration. Penalty on importer is entirely consequential upon establishment of undervaluation and suppression of facts, and absence of proof of undervaluation and additional consideration precludes penalty justification. Mere association, communication or correspondence does not establish active involvement or knowledge of alleged undervaluation. Penalty cannot be imposed merely because lawful to do so, requiring deliberate defiance or conscious disregard of legal obligations, neither of which exists in the record – The revaluation, duty demand, confiscation and all penalties set aside. [Read less]

Service Tax Liability on Sponsorship Services, Payment of tax by Service Provider - Whether the service receiver is liable to pay service tax on sponsorship services in respect of which the service tax has already been discharged by the service provider - HELD - The balance demand of service tax on sponsorship services cannot be sustained. The appellant has produced invoices with service tax amounts mentioned therein along with letters from service providers confirming tax deposits to the government. The authorities below have not indicated what further evidence or documents would be required to satisfy them. The principl... [Read more]

Service Tax Liability on Sponsorship Services, Payment of tax by Service Provider - Whether the service receiver is liable to pay service tax on sponsorship services in respect of which the service tax has already been discharged by the service provider - HELD - The balance demand of service tax on sponsorship services cannot be sustained. The appellant has produced invoices with service tax amounts mentioned therein along with letters from service providers confirming tax deposits to the government. The authorities below have not indicated what further evidence or documents would be required to satisfy them. The principle that tax cannot be demanded twice on the same service transaction, regardless of whether paid by service provider or service receiver, is well-established. The appellant's readiness to discharge dues immediately upon being pointed out before the show cause notice, combined with the production of supporting documents including service provider confirmations with their service tax registration numbers, renders the averments credible - Double taxation cannot be permitted when tax has already reached the exchequer - The balance demand for service tax on sponsorship services is set asidernrnEligibility of Cenvat Credit on Input Services - Whether input services such as coffee machine charges, club fees, and employee insurance qualify for cenvat credit eligibility when the definition of input services includes "activities relating to business" and the services have nexus or integral connection with the appellant's business activity - HELD - The definition of input services prior to April 1, 2011, included "activities relating to business, such as," which was consistently interpreted in an expansive manner by various High Courts and Tribunals to encompass all services used in relation to the business of the assessee. The show cause notice is bereft of any details explaining how and why the input services were found ineligible. The High Court decision in CCE v Ultratech Cement and tribunal decisions in Tata Teleservices for employee insurance, Imagination Technologies for coffee machine charges, and Aban Offshore for club fees demonstrate that services with nexus or integral connection to the business activity qualify for credit. Following these precedents, the cenvat credit availed by the appellant to be tenable - The demand for denial of cenvat credit is set aside. [Read less]

Service Tax - Exemption of Services under Notification No. 45/2010-ST for Transmission and Distribution of Electricity - Revenue contention that the services provided for setting up of power generation and transmission equipment prior to actual generation of electricity cannot be considered as services in relation to transmission and distribution of electricity - Whether services rendered for supply, erection, installation and commissioning of power transmission and distribution infrastructure constitute services "in relation to transmission and distribution of electricity" eligible for exemption under Notification No. 45/... [Read more]

Service Tax - Exemption of Services under Notification No. 45/2010-ST for Transmission and Distribution of Electricity - Revenue contention that the services provided for setting up of power generation and transmission equipment prior to actual generation of electricity cannot be considered as services in relation to transmission and distribution of electricity - Whether services rendered for supply, erection, installation and commissioning of power transmission and distribution infrastructure constitute services "in relation to transmission and distribution of electricity" eligible for exemption under Notification No. 45/2010-ST, even when such services are provided during the preparatory phase before commencement of actual electricity generation and distribution - HELD – The services rendered fall squarely within the ambit of Notification No. 45/2010-ST which exempts services provided "in relation to" transmission and distribution of electricity. The phrase "in relation to" has been consistently interpreted by courts to include preparatory, enabling and supportive activities integrally connected to transmission and distribution networks. The fact that electricity generation and distribution had not commenced at the time of providing the services does not exclude such services from the exemption as the contracts were with entities engaged in transmission and distribution of electricity and the services were directly linked to establishing the infrastructure necessary for such transmission and distribution - The findings recorded by the Commissioner are well-reasoned and fully supported by statutory provisions and binding judicial precedents - The order-in-original dropping the entire service tax demand is upheld and the Revenue appeal is dismissed - Taxability of Transportation and Freight Charges as GTA Service - Whether separately quantified freight and insurance charges recovered for transportation, handling and delivery of equipment as part of supply and erection contracts constitute taxable Goods Transport Agency Service or Transport of Goods by Road Service, or whether such charges form an incidental and ancillary part of the composite erection contract exempt from taxation – HELD - The service tax is required to be paid as per the amount mentioned in the consignment note and the applicable statutory rules. Absent consignment notes and evidence of who the actual transporter or carrier was and whether the consignor or consignee was liable under the consignment note, service tax cannot be appropriately levied on the freight and insurance collected from clients - The transportation undertaken was incidental to the execution of erection contracts and does not constitute a standalone taxable service. The service provider did not qualify as a GTA under the statutory definition and the manner in which service tax was demanded on freight and insurance is against the provisions of the Service Tax Rules - The order-in-original dropping the GTA service demand is upheld and the Revenue appeal is dismissed [Read less]

Service Tax - Reconciliation of Commission Payments Across Multiple Offices - Service tax demand arising from discrepancies between commission amounts shown in trial balance vis-à-vis ST-3 returns for multiple assessment periods - Whether service tax liability can be confirmed based on journal entries in Trial Balance when the service tax on commission payments for some branches were considered and discharged by centralized offices – HELD - While the appellant is not disputing the levy of service tax on commission per se, it has brought to notice that it has a practice of discharging service tax liabilities at its Kolka... [Read more]

Service Tax - Reconciliation of Commission Payments Across Multiple Offices - Service tax demand arising from discrepancies between commission amounts shown in trial balance vis-à-vis ST-3 returns for multiple assessment periods - Whether service tax liability can be confirmed based on journal entries in Trial Balance when the service tax on commission payments for some branches were considered and discharged by centralized offices – HELD - While the appellant is not disputing the levy of service tax on commission per se, it has brought to notice that it has a practice of discharging service tax liabilities at its Kolkata and Delhi offices, and if such payments are considered, it would clarify whether there is any non-payment of service tax. The appellant has not backed its submissions with proper documentary evidence regarding payments by Delhi and Kolkata offices. The matter requires remand to the adjudicating authority for fresh consideration with proper documentary evidence including full year-wise reconciliation of trial balance vis-à-vis ST-3 returns, details of entries considered by Delhi or Kolkata office, ST-3 returns of those offices showing differential journal entries, and a certificate from the chartered accountant providing complete reconciliation details - No penalty is to be imposed as there exists no mens rea, though interest would be payable if additional service tax is found due. The appeal is remanded to the adjudicating authority with directions to complete proceedings within three months of submission of documentary evidence by the appellant – The appeal is allowed by remand [Read less]

Customs - Penalty under Section 112(a) of the Customs Act, 1962 for non-declaration of retained onboard cargo - Appellant-steamer agent discovered that it retained onboard from a previous export voyage and had not been declared in the manifest. Upon learning of the retained onboard cargo from its principals, the appellant approached the Customs authorities seeking amendment of the manifest under Section 30(3) of the Customs Act. The master of the vessel subsequently admitted that he had not declared the retained onboard cargo in the boarding documents and accepted such omission as his own mistake - Whether penalty under Se... [Read more]

Customs - Penalty under Section 112(a) of the Customs Act, 1962 for non-declaration of retained onboard cargo - Appellant-steamer agent discovered that it retained onboard from a previous export voyage and had not been declared in the manifest. Upon learning of the retained onboard cargo from its principals, the appellant approached the Customs authorities seeking amendment of the manifest under Section 30(3) of the Customs Act. The master of the vessel subsequently admitted that he had not declared the retained onboard cargo in the boarding documents and accepted such omission as his own mistake - Whether penalty under Section 112(a) of the Customs Act, 1962 can be imposed on a steamer agent for non-declaration of retained onboard cargo – HELD - The penalty under Section 112(a) for aiding and abetting cannot be imposed in the absence of culpable conduct and mens rea. Mere procedural lapse, inadvertent omission or communication failure does not ipso facto attract penal consequences under this section. The role of a steamer agent is to declare goods as informed by the master of the vessel in the manifest. The master himself admitted that the omission to declare the retained onboard cargo was his mistake, and at no point did he allege any collusion, knowledge, intention or deliberate acts on the part of the steamer agent. The steamer agent's immediate action in filing an amendment application upon receiving confirmation of the retained onboard cargo demonstrates bona fide conduct and lack of fraudulent intent – Further, the retained onboard cargo never acquired the legal character of imported goods as it remained continuously onboard the vessel, was never unloaded in India, no B/E was ever filed for it, and it was ultimately discharged at foreign ports - The filing full and correct manifest primarily rests upon the master of the vessel and other agencies cannot be held liable for penal consequences where lapses arise from communication failure without fraudulent intent - The penalty imposed under Section 112(a) is set aside and the appeal is allowed [Read less]

Service Tax - Cenvat credit on running account bills, Invocation of extended period of limitation - Whether Cenvat credit can be availed based on running account bills and payment orders even if they are not specifically mentioned as prescribed documents under Rule 9(1) of the Cenvat Credit Rules, 2004 – Demand invoking extended period of limitation – HELD - The Cenvat credit availed on running account bills read with payment orders containing substantial particulars such as name and address of service provider, details of service recipient, description of service, service tax registration number, and service tax amoun... [Read more]

Service Tax - Cenvat credit on running account bills, Invocation of extended period of limitation - Whether Cenvat credit can be availed based on running account bills and payment orders even if they are not specifically mentioned as prescribed documents under Rule 9(1) of the Cenvat Credit Rules, 2004 – Demand invoking extended period of limitation – HELD - The Cenvat credit availed on running account bills read with payment orders containing substantial particulars such as name and address of service provider, details of service recipient, description of service, service tax registration number, and service tax amount is admissible. The law does not envisage that specific nomenclature of documents is essential; instead, Rule 4A(1) of the Service Tax Rules uses flexible language such as "any document, by whatever name called," indicating that rules contemplate flexibility in nomenclature depending on trade and business practices - The Cenvat Credit Scheme was to remove the cascading effect of taxes, and once the receipt of input services and payment of service tax thereon is not in dispute, denial of credit cannot be sustained merely on procedural grounds. Further, the extended period of limitation cannot be invoked against a State instrumentality which is registered with the revenue, cooperates during audit proceedings, declares the details of Cenvat credit in regular service tax returns, and where there is no evidence of malafide intent to evade duty or suppression of facts - The mere fact that the irregularity was detected during audit conducted under the self-assessment does not justify invocation of the extended period - The impugned order is set aside and the appeal is allowed [Read less]

Service Tax – Benefit of abatement on the Gross Contract Value under Notification No. 1/2006-ST dated 01.03.2006 - Denial of Abatement on Construction Services on the ground that the assessee had not claimed the abatement in its service tax returns - Whether the substantive benefit of abatement can be denied merely because the assessee failed to claim it in the returns filed – HELD - Where the facts establishing eligibility for abatement are admitted or established on record through documentary evidence such as bills, invoices, and certificates from chartered professionals, the assessee is entitled to the benefit of ab... [Read more]

Service Tax – Benefit of abatement on the Gross Contract Value under Notification No. 1/2006-ST dated 01.03.2006 - Denial of Abatement on Construction Services on the ground that the assessee had not claimed the abatement in its service tax returns - Whether the substantive benefit of abatement can be denied merely because the assessee failed to claim it in the returns filed – HELD - Where the facts establishing eligibility for abatement are admitted or established on record through documentary evidence such as bills, invoices, and certificates from chartered professionals, the assessee is entitled to the benefit of abatement regardless of whether it was formally claimed in the return. The responsibility of the proper officer is to determine the duty liability payable by the assessee after examining all abatement benefits eligible to them, whether or not specifically claimed - The Tribunal has consistently held that when material utilization is evidenced through VAT returns, purchase invoices, and professional certificates, the abatement benefit must be extended - The demand of Service Tax, along with interest, confirmed in the impugned order, is set aside - The penalty under Section 78 of the Finance Act, 1994 is also set aside. Only the penalty for non-filing of returns is upheld – The appeal is disposed of [Read less]

Central Excise - Availability of Cenvat Credit on Sales Commission services rendered by commission agents engaged in promoting, canvassing orders and effecting sales – Denial of credit on the ground that activities of commission agents constitute post-removal activities falling outside the scope of Rule 2(l) of the Cenvat Credit Rules, 2004 - Whether Cenvat credit is available on sales commission services – HELD - The Cenvat Credit Rules have been amended to include an explanation to Rule 2(l) clarifying that sales promotion includes services by way of sale of dutiable goods on commission basis. The aforesaid explanati... [Read more]

Central Excise - Availability of Cenvat Credit on Sales Commission services rendered by commission agents engaged in promoting, canvassing orders and effecting sales – Denial of credit on the ground that activities of commission agents constitute post-removal activities falling outside the scope of Rule 2(l) of the Cenvat Credit Rules, 2004 - Whether Cenvat credit is available on sales commission services – HELD - The Cenvat Credit Rules have been amended to include an explanation to Rule 2(l) clarifying that sales promotion includes services by way of sale of dutiable goods on commission basis. The aforesaid explanation was inserted as a clarification, and as a result of which, sale of goods on commission basis also stands covered under the expression ‘sales promotion’. Thus, Cenvat credit of service tax paid is available for sales promotion which also includes sales commission - Further, the Board Circular No. 943/4/2011-Cx dated 29.04.2011 clarifies that Cenvat credit is admissible on services of sale of dutiable goods on commission basis. The denial of Cenvat credit on sales commission is set aside - No suppression of facts with intention to evade tax is established in the case as the appellant acted on bonafide belief that the credit was admissible, and therefore extended period of limitation cannot be invoked - Since there is no irregularity in the availment of credit as the same is found to be legally permissible, no penalty is imposable on the individual officer - The impugned order is set aside and the appeals are allowed [Read less]

Central Excise - Entitlement of CENVAT Credit on the basis of Consolidated Challans – Appellant availed CENVAT credit on the basis of consolidated challans – Denial of CENVAT credit on the ground that the consolidated challans did not constitute proper documents as required under Rule 9(2) of the CENVAT Credit Rules, 2004 - Whether consolidated challans containing full details as required under Rule 9(2) of the CCR, 2004, constitute valid documents for availing CENVAT credit – HELD - The consolidated challans, having full details as required under Rule 9(2) of the CENVAT Credit Rules, 2004, are valid documents and th... [Read more]

Central Excise - Entitlement of CENVAT Credit on the basis of Consolidated Challans – Appellant availed CENVAT credit on the basis of consolidated challans – Denial of CENVAT credit on the ground that the consolidated challans did not constitute proper documents as required under Rule 9(2) of the CENVAT Credit Rules, 2004 - Whether consolidated challans containing full details as required under Rule 9(2) of the CCR, 2004, constitute valid documents for availing CENVAT credit – HELD - The consolidated challans, having full details as required under Rule 9(2) of the CENVAT Credit Rules, 2004, are valid documents and the assessee is entitled to avail CENVAT credit on the basis of such consolidated challans. The impugned order denying CENVAT credit lacked merit - The demand raised by denial of credit is set, as a consequence, no interest is payable and no penalty is imposable on the appellant - The appeal is allowed [Read less]

GST - Bail condition – Petitioner-accused arrested for fraudulently availing Input Tax Credit under Sections 132(1)(b)(c)(i) read with Sections 132(1)(i) and 135(5) of the CGST Act, 2017 is granted bail subject to furnishing security bond equal to the amount claimed as tax and penalty - Whether the condition imposing security bond equal to undetermined tax and penalty amount is valid and enforceable – HELD - The condition imposed is onerous and vague as the tax and penalty amount has not yet been determined. Imposing a condition for security equivalent to a yet-to-be-determined amount is vague and unreasonable - The ac... [Read more]

GST - Bail condition – Petitioner-accused arrested for fraudulently availing Input Tax Credit under Sections 132(1)(b)(c)(i) read with Sections 132(1)(i) and 135(5) of the CGST Act, 2017 is granted bail subject to furnishing security bond equal to the amount claimed as tax and penalty - Whether the condition imposing security bond equal to undetermined tax and penalty amount is valid and enforceable – HELD - The condition imposed is onerous and vague as the tax and penalty amount has not yet been determined. Imposing a condition for security equivalent to a yet-to-be-determined amount is vague and unreasonable - The accused shall furnish security of the assets disclosed in the affidavit of the family members in place of the condition of submitting a security bond equal to the tax and penalty amount - The accused is to be released on bail subject to furnishing security of the disclosed assets without insisting for compliance with the condition pertaining to the security bond equal to tax and penalty - The Special Leave Petitions are disposed of [Read less]

Customs - Determination of Country of Origin – Rejection of Certificates of Origin without Verification from Exporting Country Authority - Whether Certificates of Origin issued by competent authorities of exporting countries can be rejected and the claimed country of origin can be disregarded without conducting proper verification from the issuing authorities of those countries and without evidence of fraudulent procurement of such certificates – HELD - The Certificates of Origin cannot be discarded or rejected without verification of their authenticity from the competent authorities of the exporting countries. When go... [Read more]

Customs - Determination of Country of Origin – Rejection of Certificates of Origin without Verification from Exporting Country Authority - Whether Certificates of Origin issued by competent authorities of exporting countries can be rejected and the claimed country of origin can be disregarded without conducting proper verification from the issuing authorities of those countries and without evidence of fraudulent procurement of such certificates – HELD - The Certificates of Origin cannot be discarded or rejected without verification of their authenticity from the competent authorities of the exporting countries. When goods are accompanied by Certificates of Origin issued by the competent authorities of exporting countries, these certificates carry presumptive value as they are issued only after verification of the goods by those authorities. The proper procedure for verification is prescribed under Rule 6 of the Customs (Administration of Rules of Origin under Trade Agreements) Rules, 2020, which requires the customs authorities to make a formal verification request to the Verification Authority of the exporting country when there is doubt regarding the genuineness or authenticity of the certificate. The tribunal observes that no such verification request has been placed on record in the present case - Since the only evidence relied upon to contradict the certificates is inadmissible electronic evidence without corroboration, the country of origin as certified in the valid Certificates of Origin must be accepted - The impugned order to the extent that it rejected the country of origin as declared in Certificates of Origin and concluded that goods were of Chinese origin without proper verification from exporting country authorities is set aside - Customs - Admissibility of Electronic Evidence – Computer Printouts from Hard Disk and Mobile Devices - Whether computer printouts obtained from seized electronic devices can be admitted as evidence in customs proceedings in the absence of a certificate issued under Section 138C(4) of the Customs Act, and whether such documents can be authenticated merely by the fact that the person involved signed the panchnama prepared by the revenue officers – HELD - Computer printouts from electronic devices are not admissible as evidence in customs proceedings without a proper certificate under Section 138C(4) of the Customs Act. Section 138C(4) prescribes a mandatory requirement that any electronic record must be accompanied by a certificate containing specific details about the device, the manner of production, and the conditions under which the computer was operated. The mere fact that the director signed a panchnama does not constitute compliance with this statutory requirement, nor does it authenticate the genuineness of the extracted documents. The signing of a panchnama in a separate room without the person's awareness of whether data was actually extracted does not satisfy the legal requirement for authentication. The oral evidence or panchnama signatures cannot substitute for the mandatory written certificate - The electronic devices were not produced before the adjudicating authority and therefore cannot be treated as primary evidence. Additionally, no independent enquiry was conducted from the persons mentioned in the alleged documents, making the printouts unreliable and unverified - The impugned order is set aside to the extent that it relied upon electronic evidence in the form of computer printouts and WhatsApp chats for establishing allegations against the importer - Valuation of Imported Goods – Application of Customs Valuation Rules to goods cleared for home consumption - Whether the Customs Valuation Rules, 2007 can be applied to determine or re-determine the value of goods that have already been cleared by customs for home consumption, and whether a proforma invoice can be used as the basis for enhancement of the declared value of imported goods – HELD - The Customs Valuation Rules, 2007 can be applied only to imported goods, and goods that have already been cleared by customs for home consumption cease to be imported goods. The definition of imported goods in Section 2(25) of the Customs Act clearly provides that goods brought from outside India remain as imported goods only till their clearance for home consumption. Once cleared by customs, they lose the character of imported goods and the valuation rules become inapplicable. Therefore, the re-determination of value of already-cleared goods cannot be justified - Furthermore, a proforma invoice is in the nature of a quotation or offer and does not constitute a valid basis for enhancement of value of imported goods. The proforma invoices relied upon were recovered from the hard disk in the absence of a valid certificate under Section 138C and are therefore inadmissible as evidence. Additionally, no evidence has been produced to show that the importer actually paid or was required to pay the higher value mentioned in the proforma invoices - The impugned order to the extent that it re-determined the declared value of goods already cleared for home consumption is set aside, and consequently, the differential duty demand based on such re-valuation is not sustainable - Admissibility of Statements – Voluntariness and Corroboration Requirement - Whether statements recorded under duress or coercion without proper procedural safeguards can be relied upon to support a demand of duty, and whether mere confession statements without independent corroborative evidence can form the basis of adjudication – HELD - The statements recorded under duress or coercion cannot be relied upon to support demands or penalties - The impugned order to the extent that it relied upon statements of the director without independent corroborative evidence and without addressing the issue of voluntariness and duress is set aside - Imposition of Penalty – Whether penalties can be imposed on company Directors when the main demand against the company has failed or when specific evidence of individual involvement of the officials is not brought on record – HELD - Since the main allegations against the importing company have not been sustained and the demand for duty is not maintainable, the imposition of penalty on the company under Section 114A is not justified. Furthermore, penalties on company officials cannot survive independently when the main case against the company fails, unless specific and independent evidence of individual involvement of such officials is brought on record. In the present case, no such independent evidence of individual involvement has been adduced against the Director. Mere role in signing documents or making statements when the underlying transaction is not established as fraudulent does not constitute sufficient evidence for imposing penalty on officials - The impugned order to the extent that it imposed penalties under Section 114A against the company and under Sections 112 and 114AA against the company Director is set aside. [Read less]

GST – Haryana AAAR - Classification of Brake Hoses - The Advance Ruling Authority order held that the product merits classification under Chapter 87 - Whether brake hoses, despite being designed and used exclusively in automotive braking systems, should be classified as vulcanized rubber hoses under Chapter 40 or as motor vehicle parts under Chapter 87 – HELD – As per General Rule of Interpretation 3(b), the rubber component gives the product its essential character, being the principal determinant of its function and utility. The material composition reveals that the product is fundamentally a general-purpose vulcan... [Read more]

GST – Haryana AAAR - Classification of Brake Hoses - The Advance Ruling Authority order held that the product merits classification under Chapter 87 - Whether brake hoses, despite being designed and used exclusively in automotive braking systems, should be classified as vulcanized rubber hoses under Chapter 40 or as motor vehicle parts under Chapter 87 – HELD – As per General Rule of Interpretation 3(b), the rubber component gives the product its essential character, being the principal determinant of its function and utility. The material composition reveals that the product is fundamentally a general-purpose vulcanized rubber hose engineered for high-pressure fluid transmission and specialized fittings do not alter the intrinsic character as a hose of vulcanized rubber - The Section XVII Notes to the Customs Tariff Act exclude articles of vulcanized rubber from classification as motor vehicle parts. The judicial precedents consistently recognize that products composed predominantly of rubber and retaining their material identity must be classified under Chapter 40 even if used in automobiles - The Brake Hoses manufactured and supplied by the Appellant, being primarily composed of vulcanized rubber and retaining the essential characteristics of hoses, are appropriately classifiable under Heading 4009 of Chapter 40, taxable at 18% GST – The Advance Ruling Order is set aside and the appeal is allowed [Read less]

GST - Sealing of business premises, Attachment of bank account during search and seizure operations - Petitioner was summoned for examination but did not cooperate with the proceedings and did not appear before the authorities despite repeated summons. The petitioner instead filed a writ petition challenging the sealing of premises and attachment of bank accounts - Whether the sealing of business premises and provisional attachment of bank accounts during the course of a search and seizure operation initiated under Section 67 of the CGST Act, 2017 is valid – HELD - The sealing of premises and provisional attachment of ba... [Read more]

GST - Sealing of business premises, Attachment of bank account during search and seizure operations - Petitioner was summoned for examination but did not cooperate with the proceedings and did not appear before the authorities despite repeated summons. The petitioner instead filed a writ petition challenging the sealing of premises and attachment of bank accounts - Whether the sealing of business premises and provisional attachment of bank accounts during the course of a search and seizure operation initiated under Section 67 of the CGST Act, 2017 is valid – HELD - The sealing of premises and provisional attachment of bank accounts by the respondents are valid exercises of power conferred under Sections 67(4) and 83 of the CGST Act, 2017, respectively. The Section 67(4) confers a duty upon the authorized officer to seal premises where access is denied, and Section 83 authorizes the Commissioner to attach property to protect government revenue. The expression "reason to believe" under Section 67 contemplates objective determination based on independent care and evaluation - The seized goods can be released only upon compliance with the procedure prescribed under Section 67(6) read with Rules 140 and 141 of the CGST Rules, 2017, by filing an application with appropriate security or payment of taxes. The petitioner has failed to cooperate with the investigation, did not appear despite summons, and did not avail of the alternative and efficacious remedies provided under the Act - Where alternative and efficacious remedies are provided under the statute, a writ petition under Article 226 cannot be entertained. The petitioner should have filed an application under Section 67(6) of the Act for release of goods instead of approaching the court through a writ petition - The writ petition is dismissed [Read less]

GST - Service of Show Cause Notice at incorrect address and email-id - Violation of Natural Justice - Upon migration to the GST regime the petitioner updated its principal place of business and additional place of business addresses along with new email IDs on the GST registration certificate and portal. Despite maintaining updated address and email information with the tax authorities, the show cause notice was served at the old registered address and the old email ID - Whether an order passed by the tax authorities without serving the show cause notice at the correct and current registered address and email ID, as per th... [Read more]

GST - Service of Show Cause Notice at incorrect address and email-id - Violation of Natural Justice - Upon migration to the GST regime the petitioner updated its principal place of business and additional place of business addresses along with new email IDs on the GST registration certificate and portal. Despite maintaining updated address and email information with the tax authorities, the show cause notice was served at the old registered address and the old email ID - Whether an order passed by the tax authorities without serving the show cause notice at the correct and current registered address and email ID, as per the information maintained in the GST registration certificate and portal, is valid – HELD - The impugned demand order and recovery notice are vitiated by violation of the principles of natural justice. The SCN serves as the foundation for affording an opportunity of being heard to the assessee before passing any order. When the tax authorities maintain current address and email information of the assessee in their own official records and portal, serving the notice at outdated addresses and email IDs amounts to a failure to provide constructive notice to the assessee - The settled principle of law is that no order can be passed against an assessee without affording a reasonable opportunity of being heard. The failure to serve the SCN at the correct address and email ID renders the entire proceeding ex-parte and violates the principles of natural justice - The impugned demand order and recovery notice stand quashed and set aside. The respondents are directed to issue a fresh notice to the assessee at the correct registered address and email ID as reflected in the current GST registration certificate and portal, followed by a personal hearing and pass speaking order in accordance with law – The petition is disposed of [Read less]

GST – Kerala AAAR - Classification of vegetable-based curry preparations - Whether ready-to-eat packaged vegetable curry preparations fall within the scope of Chapter 20 (preparations of vegetables, fruits, nuts) or Chapter 21 (edible preparations) – HELD - The products in question are ready-to-eat packaged food rather than mere prepared or preserved vegetables. The authority recognizes that while Chapter 20 relates to preparations of vegetables, fruits, and nuts, the nature of the final product as a complete edible curry preparation distinguishes it from the category of prepared or preserved vegetables envisaged under... [Read more]

GST – Kerala AAAR - Classification of vegetable-based curry preparations - Whether ready-to-eat packaged vegetable curry preparations fall within the scope of Chapter 20 (preparations of vegetables, fruits, nuts) or Chapter 21 (edible preparations) – HELD - The products in question are ready-to-eat packaged food rather than mere prepared or preserved vegetables. The authority recognizes that while Chapter 20 relates to preparations of vegetables, fruits, and nuts, the nature of the final product as a complete edible curry preparation distinguishes it from the category of prepared or preserved vegetables envisaged under Chapter 20. The supplementary notes to Chapter 21 specifically contemplate preparations for use either directly or after processing such as cooking, dissolving, or boiling in water, milk, or other liquids for human consumption, thereby bringing these products squarely within heading 2106 which covers food preparations not elsewhere specified or included. Applying Rule 3(a) of the Rules for Interpretation of the Tariff, the authority determines that heading 2106 provides a more specific description of ready-to-eat packaged curries than heading 2005 - The classification of items under heading 21069099 is upheld.rnrnClassification of nut-based preparations - Whether a packaged ready-to-eat coconut-based preparation falls within Chapter 20 (preparations of fruits and nuts) or Chapter 21 (edible preparations) – HELD - While the product is indeed nut-based and may technically fall within the scope of Chapter 20 headings, the nature of the final product as a complete ready-to-eat packaged item distinguishes it from preparations contemplated under Chapter 20. The authority determines that a packaged ready-to-eat item more appropriately falls under Chapter 21, which covers edible preparations suitable for direct consumption or after minimal processing, rather than under Chapter 20 which covers the prepared or preserved state of raw ingredients - The classification of the item under heading 21069099 is upheld. [Read less]

GST – Kerala AAAR - Taxability of fees for conversion of wetland to dryland under Reverse Charge - Whether the fee paid by the company for conversion of wetland to dryland by the State Government constitutes consideration for a taxable supply of service liable to GST under RCM or falls within the exemption provided under Notification No. 14/2017-Central Tax (Rate) as an activity entrusted to Panchayats under Article 243G of the Constitution read with the Eleventh Schedule – HELD - The fee paid for conversion of wetland to dryland constitutes consideration for a taxable supply of service by the State Government liable t... [Read more]

GST – Kerala AAAR - Taxability of fees for conversion of wetland to dryland under Reverse Charge - Whether the fee paid by the company for conversion of wetland to dryland by the State Government constitutes consideration for a taxable supply of service liable to GST under RCM or falls within the exemption provided under Notification No. 14/2017-Central Tax (Rate) as an activity entrusted to Panchayats under Article 243G of the Constitution read with the Eleventh Schedule – HELD - The fee paid for conversion of wetland to dryland constitutes consideration for a taxable supply of service by the State Government liable to GST under RCM as per Notification No. 13/2017-Central Tax (Rate) - The land conversion is legally and factually distinct from land improvement. While land improvement refers to enhancing the quality or productivity of existing land without changing its classification, land conversion means changing the legal classification of land itself from one category to another, such as from wetland to dryland. The Eleventh Schedule of the Constitution, read with Article 243G, expressly lists land improvement as a function entrusted to Panchayats but makes no mention of land conversion - The activity of converting land from wetland to dryland cannot be equated with any of the activities listed as entrusted to Panchayats under Article 243G of the Constitution. The fee charged represents a consideration or compensation for conferring a private benefit to the applicant at the cost of the public good of conservation of paddy land and wetland - The State Government, by exercising its statutory power to permit conversion of land for the exclusive benefit of the applicant, supplies a taxable service within the scope of Item 5 of Notification No. 13/2017-Central Tax (Rate), which subjects services supplied by State Government to business entities to GST under RCM - The ruling given by the Authority for Advance Ruling is upheld and the appeal is dismissed [Read less]

GST - Liability to GST under Reverse Charge Mechanism on Government Services – GST on Permission, Road Cutting, Reinstatement and Ground Rent Charges – Appellant sought Advance Ruling regarding liability to pay GST under RCM on permission charges, road cutting charges, reinstatement charges and ground rent charges levied by the State PWD authorities for laying pipelines and cables – The AAR order held that GST is leviable on permission, charges, reinstatement charges, road cutting charges and ground rent charges - Whether GST is leviable on permission charges, reinstatement charges, road cutting charges and ground re... [Read more]

GST - Liability to GST under Reverse Charge Mechanism on Government Services – GST on Permission, Road Cutting, Reinstatement and Ground Rent Charges – Appellant sought Advance Ruling regarding liability to pay GST under RCM on permission charges, road cutting charges, reinstatement charges and ground rent charges levied by the State PWD authorities for laying pipelines and cables – The AAR order held that GST is leviable on permission, charges, reinstatement charges, road cutting charges and ground rent charges - Whether GST is leviable on permission charges, reinstatement charges, road cutting charges and ground rent charges levied by State PWD authorities under Reverse Charge in terms of Sl.No. 5 of Notification 13/2017-Central Tax (Rate) dated 28-06-2017 – HELD – The Sl.No. 5 of Notification 13/2017-CT (Rate) clearly provides that GST on services supplied by Central Government, State Government, Union Territory or Local Authority to a business entity is payable by the service recipient under RCM - In the present case, the PWD falls under the category of State Government or Local Authority and the taxpayer is a business entity engaged in commercial activities. Therefore, the taxpayer qualifies as the recipient of services and is rightly liable to pay GST under Reverse Charge - The Advance Ruling order is upheld and the appeal is rejected [Read less]