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Customs - Classification of 'Natural Rubber Latex Concentrate' – Appellant imported 'Natural Rubber Latex Concentrate' in liquid form and classified it under CTH 4001 2910 attracting BCD @ 20% - Department reclassified the goods under CTH 40011020 attracting BCD @ 70% and demanded short-paid customs duty along with equal penalty under section 114A of the Customs Act, 1962 - Whether the goods imported by the appellant are correctly classifiable under CTH 4001 2910 or CTH 40011020 of the Customs Tariff Act, 1975 – HELD - The burden of proving the correct classification of the goods is on the revenue Department. There was... [Read more]

Customs - Classification of 'Natural Rubber Latex Concentrate' – Appellant imported 'Natural Rubber Latex Concentrate' in liquid form and classified it under CTH 4001 2910 attracting BCD @ 20% - Department reclassified the goods under CTH 40011020 attracting BCD @ 70% and demanded short-paid customs duty along with equal penalty under section 114A of the Customs Act, 1962 - Whether the goods imported by the appellant are correctly classifiable under CTH 4001 2910 or CTH 40011020 of the Customs Tariff Act, 1975 – HELD - The burden of proving the correct classification of the goods is on the revenue Department. There was a genuine divergence of views involving interpretation of law on the classification of the goods between the appellant and the Revenue, as tariff heading 4001 2910 specifically recognizes 'Hevea' as a distinct variety of natural rubber latex - The appellant's declarations and past clearances, being an Accredited Client Programme (ACP) client, warranted a more rigorous and careful scrutiny by the adjudicating authority. Further, the Tribunal held that a finding of wilful misstatement requires the presence of a positive act which betrays a negative intention of wilful default, which was not demonstrated in the present case - The show cause notice is time-barred as it was issued beyond the normal period of one year from the relevant date. Once the demand is found to be time-barred, there is no occasion for the Tribunal to enquire into the merits of the issues - The impugned order is set aside and the appeal is allowed on the ground of time-bar [Read less]

GST - Validity of assessment order and summary order - Petitioner challenge the assessment order and the summary order on the grounds that the assessment order does not contain the signature of the respondent and the summary order does not contain the Document Identification Number (DIN) - Whether the assessment order and the summary order in Form DRC-07 are valid in the eye of law - HELD - The contention of the petitioner that the assessment order and the summary order are liable to be set aside on the ground that they do not contain the signatures and DIN respectively, does not merit consideration. The show-cause notice ... [Read more]

GST - Validity of assessment order and summary order - Petitioner challenge the assessment order and the summary order on the grounds that the assessment order does not contain the signature of the respondent and the summary order does not contain the Document Identification Number (DIN) - Whether the assessment order and the summary order in Form DRC-07 are valid in the eye of law - HELD - The contention of the petitioner that the assessment order and the summary order are liable to be set aside on the ground that they do not contain the signatures and DIN respectively, does not merit consideration. The show-cause notice in Form GST DRC-01 and the summary of the assessment order in Form GST DRC-07 have to be issued electronically and they cannot be issued electronically unless the said proceedings have been digitally signed by the issuing authority. Further, the affixture of any digital signature on any document or proceeding would automatically generate an Identification Number, called the RFN Number, and the presence of an RFN number is sufficient to hold that a digital signature has been affixed on the said documents. In the present case, the summary of the orders contains the RFN Number, and therefore, the contention of the petitioner that the summary order does not contain DIN is liable to be rejected – The writ petition is dismissed [Read less]

The transfer of entire unit, as a going concern, including the assets and liabilities is sale of business itself and not supply of individual goods. The transfer of entire unit, as a going concern, cannot be considered a supply of goods or services.

GST – Challenge to Summons under Section 70 of CGST Act, 2017 and arrest under Section 69 of CGST Act, 2017 - Petitioners claimed that the summons were in violation of the guidelines issued by the Board and were issued in a mechanical manner without following the proper procedure. They also sought the release of the seized documents and goods and restraining the respondent from illegally detaining the petitioners - Whether the summons issued under Section 70 of the CGST Act, 2017 can be challenged at the stage of inquiry – HELD - The summons issued under Section 70 of the CGST Act are part of the inquiry process and no... [Read more]

GST – Challenge to Summons under Section 70 of CGST Act, 2017 and arrest under Section 69 of CGST Act, 2017 - Petitioners claimed that the summons were in violation of the guidelines issued by the Board and were issued in a mechanical manner without following the proper procedure. They also sought the release of the seized documents and goods and restraining the respondent from illegally detaining the petitioners - Whether the summons issued under Section 70 of the CGST Act, 2017 can be challenged at the stage of inquiry – HELD - The summons issued under Section 70 of the CGST Act are part of the inquiry process and not the initiation of proceedings. The nature of a summons is to gather information and evidence, and it cannot be equated with the initiation of proceedings. In the judgments of Armour Security India Limited vs. Commissioner CGST and Radhika Agarwal vs. Union of India, it has been held that the issuance of summons is a precursor to the proceedings and does not amount to the initiation of proceedings - In any case, the Summons have been issued for taking the statement of the petitioners and seeking the production of documents/ invoices against the goods seized during the search procedure conducted. There is no illegality in the said summons to this extent, and the Respondent has acted well within its powers - Seeking setting aside of Summons, is essentially seeking interim protection or an anticipatory bail, during an inquiry stage, i.e. essentially at a stage when the Respondent is collecting information and evidence based on suspicion and cannot be equated with the initiation of proceedings - The writ petition is dismissed being premature [Read less]

GST - Ex-parte Order, Availability of Statutory Remedy, denial of opportunity of personal hearing - Whether the show cause notice and the impugned order were properly served on the petitioner – HELD - The petitioner has a statutory remedy available under Section 107 of the CGST Act, which provides for an appeal against the impugned order. The appellate authority is empowered to examine both questions of fact and law, including the petitioner's grievances regarding service of notice, compliance with Section 169, and the alleged denial of opportunity of personal hearing under Section 75(4) of the Act. The exercise of writ ... [Read more]

GST - Ex-parte Order, Availability of Statutory Remedy, denial of opportunity of personal hearing - Whether the show cause notice and the impugned order were properly served on the petitioner – HELD - The petitioner has a statutory remedy available under Section 107 of the CGST Act, which provides for an appeal against the impugned order. The appellate authority is empowered to examine both questions of fact and law, including the petitioner's grievances regarding service of notice, compliance with Section 169, and the alleged denial of opportunity of personal hearing under Section 75(4) of the Act. The exercise of writ jurisdiction under Article 226 of the Constitution is discretionary and should not be invoked where an effective and efficacious alternative statutory remedy is available, unless exceptional circumstances such as lack of jurisdiction, violation of fundamental rights, or a patent breach of the principles of natural justice are clearly established. In the present case, the issues raised by the petitioner can be appropriately and effectively adjudicated by the appellate authority under Section 107 of the CGST Act - The writ petitions are dismissed on the ground of availability of an alternative statutory remedy – Ordered accordingly [Read less]

GST - Fraudulent availment of Input Tax Credit – Exercise of writ petition challenging the following Orders-in-Original and Show Cause Notices – Vide the impugned order the High Court dismissed the writ petition and held that the petitioner is free to take all the contentions which it wishes to raise before the Appellate Authority – Assessee in appeal – SC HELD – No good ground to interfere with the impugned order. The High Court order/judgement is upheld and the special leave petition is dismissed

Service Tax - Classification of Services - Appellant is engaged in conducting bio-equivalence (BE) and bio-availability (BA) studies for their domestic and overseas clients. The Department classified these services under the category of 'Technical Testing and Analysis Service' (TTAS) whereas the appellant claimed that the services should be classified under 'Scientific or Technical Consultancy Service' (STCS) - Whether the appellant's BE/BA studies are classifiable under TTAS or STCS - HELD - The appellant's activities of conducting comparative study of test drug and reference drug to determine their bioequivalence fall un... [Read more]

Service Tax - Classification of Services - Appellant is engaged in conducting bio-equivalence (BE) and bio-availability (BA) studies for their domestic and overseas clients. The Department classified these services under the category of 'Technical Testing and Analysis Service' (TTAS) whereas the appellant claimed that the services should be classified under 'Scientific or Technical Consultancy Service' (STCS) - Whether the appellant's BE/BA studies are classifiable under TTAS or STCS - HELD - The appellant's activities of conducting comparative study of test drug and reference drug to determine their bioequivalence fall under the category of TTAS. However, even if the services are classified under TTAS, they would qualify as export of service under Rule 3(2) of the Export of Service Rules, 2005 - The reports, data, and scientific observations were provided to the clients located outside India and used outside India. Even though the actual activities were performed within India, the delivery of the results and technical details to the foreign clients would be considered as part performance of the service outside India. The Tribunal in CST, Ahmedabad Vs BA Research India Ltd and SGS India Pvt Ltd Vs CST, Mumbai-II, held that such provision of services to foreign clients should be treated as export of service – Further, the CBIC has clarified that the term "used outside India" should be interpreted to mean that the benefit of the service should accrue outside India, which is satisfied in the present case - The appellant's BE/BA studies provided to foreign clients should be treated as export of service and not subject to service tax – The impugned order is set aside and the appeal is allowed [Read less]

Central Excise - Duty on Blending of LPG, Demand invoking extended period - Whether the activity of mixing/blending of 'propane' and 'butane' undertaken by appellant, on behalf of IOCL, amounts to manufacture HELD - The activity of mixing/blending of 'propane' and 'butane' undertaken by the appellant amounts to manufacture. Once the blending was done, the resultant product was LPG, which was then cleared by the appellant - There was neither suppression of facts nor any willful misstatement by the appellant to warrant invocation of the extended period of limitation. All the activities were undertaken in full transparency an... [Read more]

Central Excise - Duty on Blending of LPG, Demand invoking extended period - Whether the activity of mixing/blending of 'propane' and 'butane' undertaken by appellant, on behalf of IOCL, amounts to manufacture HELD - The activity of mixing/blending of 'propane' and 'butane' undertaken by the appellant amounts to manufacture. Once the blending was done, the resultant product was LPG, which was then cleared by the appellant - There was neither suppression of facts nor any willful misstatement by the appellant to warrant invocation of the extended period of limitation. All the activities were undertaken in full transparency and were within the knowledge of the department – The appeal is partially allowed by confirming the demand for the normal period. However, the demand alleging ineligible CENVAT credit against the appellant is dropped as the credit was held to be eligible - Whether the CENVAT credit availed and utilized during the course of investigation was an ineligible credit and the confirmation of demand is tenable – HELD - As per Rule 9 of the CENVAT Credit Rules, 2004, CENVAT credit can be availed on the basis of prescribed documents, including a Bill of Entry. Following the Supreme Court judgment in Union of India Vs. M/s. Marmagoa Steel Ltd. and the Tribunal's own decision in Hindustan Zinc Ltd. Vs. CCE, Jaipur-II, the CENVAT credit cannot be denied for imported goods once duty is paid and goods are received, even if technical deficiencies exist in the Bill of Entry. The period of limitation computed was also held to be unsustainable. [Read less]

Service Tax – Computation of demand based on ST-3 returns - Appellant did not dispute the service tax liability but contested the computation and recovery of interest and penalty - Whether the appellant had correctly paid the service tax liability by utilizing the CENVAT credit, which was not considered by the Commissioner in the impugned order – HELD - The ST-3 returns for the period October 2011 to March 2012 showed that the appellant had paid the service tax liability by debiting the CENVAT credit account, in addition to the cash payments. The Commissioner had not taken this into account while confirming the demand,... [Read more]

Service Tax – Computation of demand based on ST-3 returns - Appellant did not dispute the service tax liability but contested the computation and recovery of interest and penalty - Whether the appellant had correctly paid the service tax liability by utilizing the CENVAT credit, which was not considered by the Commissioner in the impugned order – HELD - The ST-3 returns for the period October 2011 to March 2012 showed that the appellant had paid the service tax liability by debiting the CENVAT credit account, in addition to the cash payments. The Commissioner had not taken this into account while confirming the demand, resulting in the incorrect computation of the payable amount - The matter is remanded to the adjudicating authority to re-examine the service tax liability, interest, and penalty after adjusting the payments made by the appellant through cash and CENVAT credit, as reflected in the ST-3 returns - The appeal is remanded to the adjudicating authority for limited purpose of re-determining the final payable amount after considering the CENVAT credit utilization by the appellant - The appeal is allowed by way of remand [Read less]

Service Tax – Eligibility to Cenvat Credit on various input services like business support services, visa fees, personnel baggage, general insurance, life insurance, rent-a-cab, manpower recruitment, etc.- Eligibility of Cenvat credit on Business Support Services, Visa Fees, Personnel Baggage - HELD - Since the appellant had availed similar credits in its earlier period and the Tribunal had upheld the same, the credits for the current period should also be allowed, subject to verification of nexus between the input and output services. The matter is remanded to the adjudicating authority for re-examination - The impugned... [Read more]

Service Tax – Eligibility to Cenvat Credit on various input services like business support services, visa fees, personnel baggage, general insurance, life insurance, rent-a-cab, manpower recruitment, etc.- Eligibility of Cenvat credit on Business Support Services, Visa Fees, Personnel Baggage - HELD - Since the appellant had availed similar credits in its earlier period and the Tribunal had upheld the same, the credits for the current period should also be allowed, subject to verification of nexus between the input and output services. The matter is remanded to the adjudicating authority for re-examination - The impugned order is set aside except for the denial of credit on general insurance services. The other issues are remanded to the adjudicating authority for re-examination as per the directions given. The appeal is partly allowed by remand - Eligibility of Cenvat credit on General Insurance Services - HELD - Since the medical insurance for employees is not a statutory requirement, and is specifically excluded from the definition of 'input service', the credit is not eligible. The denial of credit on this ground is upheld - Eligibility of Cenvat credit on Life Insurance and Rent-a-Cab Services - HELD - If the appellant had discharged service tax on the amounts collected from employees towards such services, the credit to that extent should be allowed, subject to verification of records. The matter is remanded - Eligibility of Cenvat credit on other services like Clearing & Forwarding, Management Consultancy, Commercial Training, Maintenance, Sponsorship, Hotel Stay, Goods Transport, Manpower Recruitment – HELD - Since the eligibility of these services was accepted in the appellant's earlier period, the matter is remanded to the adjudicating authority to re-examine the eligibility based on the documents and decisions relied upon by the appellant - Incorrect Computation of Refund – HELD - The refund should be computed based on the gross Cenvat credit availed, without deducting the credit utilized for domestic liability and reversals, as per the Tribunal's earlier decision in the appellant's own case. The matter is remanded for re-computation. [Read less]

Service Tax - Cosmetic and plastic surgery and Healthcare services - Appellant operates a clinical establishment under the brand name 'Medlinks', providing dermatological and trichological healthcare services - Whether the services provided by the appellant fall under the category of 'cosmetic and plastic surgery services' and are thus liable to service tax, or whether they qualify as 'health care services' and are entitled to exemption – HELD – There is a fine line of distinction between an activity being covered as a cosmetic and plastic surgery or as a healthcare service. The services provided by the appellant inclu... [Read more]

Service Tax - Cosmetic and plastic surgery and Healthcare services - Appellant operates a clinical establishment under the brand name 'Medlinks', providing dermatological and trichological healthcare services - Whether the services provided by the appellant fall under the category of 'cosmetic and plastic surgery services' and are thus liable to service tax, or whether they qualify as 'health care services' and are entitled to exemption – HELD – There is a fine line of distinction between an activity being covered as a cosmetic and plastic surgery or as a healthcare service. The services provided by the appellant include treatments for various skin and hair conditions, some of which may be undertaken for medical reasons, while others may be for aesthetic purposes. The definition of 'health care services' in the Mega Exemption Notification specifically excludes hair transplant or cosmetic or plastic surgery, except when undertaken to restore or reconstruct anatomy or functions of the body affected due to congenital defects, developmental abnormalities, injury or trauma – Matter is remanded to the adjudicating authority to examine the nature of each service rendered by the appellant and give reasoned findings on whether they qualify as healthcare services or cosmetic and plastic surgery services - The appeal is allowed by way of remand - Invocation of Extended Period of Limitation - The appellant argued that the demand under the show cause notice was time-barred, as it pertained to the period prior to the invocation of the extended period of limitation - Whether the extended period of limitation can be invoked in the present case – HELD - The issue is one of interpretation as to whether the services rendered by the appellant would fall under health care services and be entitled to exemption, or under cosmetic and plastic surgery services and be liable to service tax. Where the issue is one of interpretation, the element of suppression or misstatement cannot be attributed to the assessee, and therefore, the extended period of limitation cannot be invoked - Cum-Tax Benefit under Section 67(2) - The appellant argued that it is entitled to the cum-tax benefit under Section 67(2) of the Finance Act, 1994 - Whether the appellant is entitled to the cum-tax benefit – HELD - The service tax is an indirect tax, and as per the system of taxation, the tax borne by the consumer of services is collected by the assessee and remitted to the government. When the amount is collected for the provision of services, the total compensation received should be treated as inclusive of the service tax due to be paid by the ultimate customer, unless the service tax is also paid by the customer separately. The appellant is entitled to the cum-tax benefit under Section 67(2) of the Finance Act, 1994. [Read less]

GST – Anti-Profiteering – Complainant alleged that the respondent did not pass on the benefit of input tax credit to the complainant by way of commensurate reduction in the prices on purchase of the said flat after the introduction of GST - Whether the respondent has contravened the provision under section 171 of the CGST Act, 2017 by not passing on the benefit of ITC to the complainant – HELD - The flat was booked by the complainant in the post-GST period. As per the judgment of the High Court of Delhi in Reckitt Benckiser India Pvt. Ltd. Vs. Union of India, since the price of the flat would have been fixed after ta... [Read more]

GST – Anti-Profiteering – Complainant alleged that the respondent did not pass on the benefit of input tax credit to the complainant by way of commensurate reduction in the prices on purchase of the said flat after the introduction of GST - Whether the respondent has contravened the provision under section 171 of the CGST Act, 2017 by not passing on the benefit of ITC to the complainant – HELD - The flat was booked by the complainant in the post-GST period. As per the judgment of the High Court of Delhi in Reckitt Benckiser India Pvt. Ltd. Vs. Union of India, since the price of the flat would have been fixed after taking into account the ITC which has become available to the builder in the post-GST period and which was not available to him in the pre-GST period, no benefit of ITC to the home buyer would be available – Further, the DGAP, after scrutinizing the relevant documents and considering the reply submitted by the respondent, arrived at the conclusion that the respondent has not contravened the provision under Section 171. The DGAP has taken into consideration the ITC availed, and the purchase value of Goods and Services during pre and post GST period, and found that the ratio of ITC as a percentage of expenses incurred on purchase of inputs Goods and Services in the post GST period was reduced as against the percentage during pre-GST period. Therefore, there was no saving made by the respondent on account of implementation of GST - The report of the DGAP is accepted and the objections raised by the complainant are rejected – Ordered accordingly [Read less]

Custom - Classification of the impugned goods viz. Tendofit, Mobilee &GG Orosoluble - Appellant challenged the classification of imported goods Tendofit, Mobilee, and GG Orosoluble under Chapter 21 of the Customs Tariff as "Miscellaneous Edible Preparations" instead of under Chapters 39 and 30 as claimed by the appellant - Whether the imported goods were correctly classified under Chapter 21 or should be classified under Chapters 39 and 30 as claimed by the appellant – HELD - Tendofit, which contained 86% Mucopolysaccharides and 15% Collagen, should be classified under Chapter 39 as a natural polymer, based on the expert... [Read more]

Custom - Classification of the impugned goods viz. Tendofit, Mobilee &GG Orosoluble - Appellant challenged the classification of imported goods Tendofit, Mobilee, and GG Orosoluble under Chapter 21 of the Customs Tariff as "Miscellaneous Edible Preparations" instead of under Chapters 39 and 30 as claimed by the appellant - Whether the imported goods were correctly classified under Chapter 21 or should be classified under Chapters 39 and 30 as claimed by the appellant – HELD - Tendofit, which contained 86% Mucopolysaccharides and 15% Collagen, should be classified under Chapter 39 as a natural polymer, based on the expert opinion submitted by the appellant and the US Customs ruling that Chondroitin Sulphate, the main component of Tendofit, is a natural polymer. The Department failed to provide any evidence to controvert the appellant's classification, and classification has to be based on the condition of goods at the time of import, not their intended use – The product Mobilee, which contained 60-75% Sodium Hyaluronate along with Polysaccharides and Collagen, should also be classified under Chapter 39 as a natural polymer, based on the expert opinion and the US and EU Customs classification of Sodium Hyaluronate. The Department's contention that the presence of Collagen makes it a food preparation is rejected, as Mobilee was imported in bulk and required formulation before becoming edible - The product GG Orosoluble, which was a probiotic containing Lactobacillus Rhamnosus GG along with excipients, should be classified under Chapter 30 as a probiotic/culture of microorganisms, based on the expert opinion submitted by the appellant. The Department failed to lead any evidence to controvert the appellant's classification - The classification adopted by the appellant is correct. The impugned order is set aside and the appeal is allowed [Read less]

Customs - Refund of Pre-Deposit - Appellant aggrieved by the rate of interest awarded at 6% per annum by the Commissioner (Appeals) on the refunded amount - Whether the refund amount should be disbursed to the appellant along with interest at the rate of 12% per annum from the date of deposit till the date of refund, as claimed by the appellant – HELD - As per the Notification No. 70/2014-Customs dated 12.08.2014, the rate of interest to be paid on refunds is within the range of 5% to 30%, and the Commissioner (Appeals) has rightly awarded interest at the rate of 6% per annum - The Madras High Court in the case of C. Pad... [Read more]

Customs - Refund of Pre-Deposit - Appellant aggrieved by the rate of interest awarded at 6% per annum by the Commissioner (Appeals) on the refunded amount - Whether the refund amount should be disbursed to the appellant along with interest at the rate of 12% per annum from the date of deposit till the date of refund, as claimed by the appellant – HELD - As per the Notification No. 70/2014-Customs dated 12.08.2014, the rate of interest to be paid on refunds is within the range of 5% to 30%, and the Commissioner (Appeals) has rightly awarded interest at the rate of 6% per annum - The Madras High Court in the case of C. Padmini Chinnadurai v. Assistant Commissioner, Central Excise, Tirunelveli and the CESTAT in the case of Devendra Udyog v. Commissioner of CGST, Jodhpur, has held that if the deposit is towards the payment of duty/tax, the provisions of Section 11BB of the Central Excise Act would apply, and the notifications prescribing the rate of interest issued under this section would be applicable - The interest shall be computed and paid at the rate of 6% per annum as mentioned in the notification issued under Section 129EE of the Customs Act, 1962, which is pari materia to Section 11BB of the Central Excise Act - The interest awarded at the rate of 6% per annum is in accordance with the applicable statutory provisions and notifications – The appeal is dismissed [Read less]

Service Tax - Reverse Charge Liability for Ocean Freight - Department initiated investigation and demanded service tax under reverse charge on the ocean freight incurred by the appellant - Whether the appellant can be made liable to pay service tax on ocean freight under RCM – HELD - The assessee being neither the service provider nor the service recipient, cannot be made liable to pay service tax on ocean freight paid by the foreign seller to the foreign shipping line. The levy of service tax on ocean freight under Reverse Charge has been declared unconstitutional as it goes beyond the scope of Sections 64, 66B, 67 and ... [Read more]

Service Tax - Reverse Charge Liability for Ocean Freight - Department initiated investigation and demanded service tax under reverse charge on the ocean freight incurred by the appellant - Whether the appellant can be made liable to pay service tax on ocean freight under RCM – HELD - The assessee being neither the service provider nor the service recipient, cannot be made liable to pay service tax on ocean freight paid by the foreign seller to the foreign shipping line. The levy of service tax on ocean freight under Reverse Charge has been declared unconstitutional as it goes beyond the scope of Sections 64, 66B, 67 and 94 of the Finance Act, 1994 – The Hon’ble High Court of Gujarat in the case of M/s. SAL Steel Limited Vs. Union of India has held that Notification Nos. 15/2017-S.T. and 16/2017-S.T. making Rule 2(1)(d)(EEC) and Rule 6(7CA) of the Service Tax Rules and inserting Explanation-V to reverse charge Notification No. 30/2012-S.T. is ultra vires Sections 64, 66B, 67 and 94 of the Finance Act, 1994 - The order of the Commissioner (Appeal) which had set aside the demand of service tax on ocean freight under RCM is upheld and the Revenue appeal is dismissed [Read less]

GST - Reversal of Input Tax Credit on account of Credit Notes and on account of discrepancy in place of supply, Non-consideration of GST returns - Whether the petitioner was required to reverse the ITC – HELD - The facts and figures indicating the petitioner's liability to reverse ITC were available in the relevant GST return Forms filed by the petitioner. However, the Appellate Authority failed to consider these records and did not provide any reasons for why the amounts mentioned in the return forms should not be considered. In such situation, the Appellate Authority ought to have considered such facts and figures as a... [Read more]

GST - Reversal of Input Tax Credit on account of Credit Notes and on account of discrepancy in place of supply, Non-consideration of GST returns - Whether the petitioner was required to reverse the ITC – HELD - The facts and figures indicating the petitioner's liability to reverse ITC were available in the relevant GST return Forms filed by the petitioner. However, the Appellate Authority failed to consider these records and did not provide any reasons for why the amounts mentioned in the return forms should not be considered. In such situation, the Appellate Authority ought to have considered such facts and figures as available on the portal itself and then proceeded to answer the issues that were raised before it - There is no discussion as regards the aforesaid facts and figures in the order impugned and there is nothing to indicate why the amounts mentioned in the said return Forms should not be considered. This was a clear abdication of duty on the part of the Appellate Authority - The orders of the Appellate Authority and the Adjudicating Authority/Proper Officer are set aside and the matter is remanded for fresh consideration by the Adjudicating Authority after affording the petitioner an opportunity of hearing and considering the relevant GST return forms – The petition is disposed of [Read less]

Haryana Value Added Tax Act, 2003 - Statutory pre-deposit requirement for hearing appeal against tax assessment - Petitioner argued that it faced severe financial hardship and its case had merit, therefore, the appellate authority should have entertained the appeal without insisting on the pre-deposit - Whether the appellate authority can be directed to entertain the petitioner's appeal without insisting on the statutory pre-deposit in terms of Section 33(5) of HVAT Act, 2003 – HELD - Relying on Supreme Court decision in M/s Tecnimont Pvt. Ltd. v. State of Punjab, the pre-deposit condition is not onerous, harsh or unreas... [Read more]

Haryana Value Added Tax Act, 2003 - Statutory pre-deposit requirement for hearing appeal against tax assessment - Petitioner argued that it faced severe financial hardship and its case had merit, therefore, the appellate authority should have entertained the appeal without insisting on the pre-deposit - Whether the appellate authority can be directed to entertain the petitioner's appeal without insisting on the statutory pre-deposit in terms of Section 33(5) of HVAT Act, 2003 – HELD - Relying on Supreme Court decision in M/s Tecnimont Pvt. Ltd. v. State of Punjab, the pre-deposit condition is not onerous, harsh or unreasonable, and the appellate authority does not have the discretion to grant relief against this requirement - In terms of Section 33(5) of HVAT Act, it is open to the assessee to submit even a bank guarantee or adequate security to the satisfaction of assessing Authority in the manner prescribed for the amount in dispute. The financial information provided by the Department indicated that the petitioner's financial status is sound, with significant taxable turnover and tax payments under the GST regime - The petitioner is granted liberty to take necessary steps for compliance with the pre-deposit requirement - The writ petition is dismissed, upholding the statutory pre-deposit requirement for entertaining the petitioner's appeal [Read less]

Central Excise – Applicable interest on delayed refund of rebate amount, inordinate delay in adjudication of Show Cause Notice - Appellant filed writ petition against the inordinate delay in the adjudication of the SCNs, pursuant to which the High Court quashed the SCNs. Consequently, the rebate claims were sanctioned, but no interest was paid for the delay of 12 years - Whether the appellant is entitled to interest at a higher rate than 6% per annum on the delayed refund of the rebate claims – HELD - The appellant is entitled to interest at the rate of 12% per annum on the sanctioned rebate claims from the date of dep... [Read more]

Central Excise – Applicable interest on delayed refund of rebate amount, inordinate delay in adjudication of Show Cause Notice - Appellant filed writ petition against the inordinate delay in the adjudication of the SCNs, pursuant to which the High Court quashed the SCNs. Consequently, the rebate claims were sanctioned, but no interest was paid for the delay of 12 years - Whether the appellant is entitled to interest at a higher rate than 6% per annum on the delayed refund of the rebate claims – HELD - The appellant is entitled to interest at the rate of 12% per annum on the sanctioned rebate claims from the date of deposit till the date of refund. The provisions of Section 11BB of the Central Excise Act, 1944 regarding payment of interest on delayed refund would not be sufficient in cases of abnormal delay, as in the present case where the refund was delayed by more than 12 years without any fault of the appellant. If the refund/rebate has been withheld for an unreasonable time and the appellant suffers hardship, interest at a higher rate, not less than 12%, is required to be paid. The appellant cannot be deprived of the interest earned by the department on the retained amount, as it is the property of the appellant. Accordingly, the impugned Order-in-Appeal is modified and the department was directed to pay interest at the rate of 12% per annum on the sanctioned rebate claims – The appeal is allowed [Read less]

GST - Unblocking of Electronic Credit Ledger and Initiation of Adjudication Proceedings – Rejection of prayer for unblocking of electronic credit ledger but refusal to initiate and conclude adjudication proceedings despite the petitioner’s request - Whether the Proper Officer's observation that the "act of violation is not suitable for adjudication" can be sustained – HELD - The provisions of Rule 86A of the CGST Rules, 2017 which allow the revenue authorities to withhold debit of an amount equivalent to the credit in the electronic credit ledger, are clearly aimed at securing the tax apprehended to be in default eit... [Read more]

GST - Unblocking of Electronic Credit Ledger and Initiation of Adjudication Proceedings – Rejection of prayer for unblocking of electronic credit ledger but refusal to initiate and conclude adjudication proceedings despite the petitioner’s request - Whether the Proper Officer's observation that the "act of violation is not suitable for adjudication" can be sustained – HELD - The provisions of Rule 86A of the CGST Rules, 2017 which allow the revenue authorities to withhold debit of an amount equivalent to the credit in the electronic credit ledger, are clearly aimed at securing the tax apprehended to be in default either due to fraudulent availment of ITC or availment of ITC despite ineligibility. This is an interim measure pending adjudication, and the Proper Officer cannot refuse to conduct adjudication. Once the provision of Rule 86A is resorted to, it cannot be said by the Proper Officer that adjudication itself cannot be done - The Proper Officer's observation that the "act of violation is not suitable for adjudication" cannot be sustained. The Proper Officer is directed to initiate adjudication proceedings by issuing a show cause notice to the petitioners within a week, allow the petitioners to file a reply within a week thereafter, and conclude the adjudication proceedings by passing an appropriate order within three weeks from the date of receipt of the petitioners' reply. If the adjudication proceedings are not concluded within the stipulated time, the Proper Officer shall have to unblock the electronic credit ledger of the petitioners - The writ petition is disposed of [Read less]

GST - Validity of order of detention, Uploading of the notice on common portal, Passing of ex-parte order - The goods along with the vehicle were intercepted and an order of detention was passed under Section 129(1) of the UPGST Act, 2017 - Validity of the order of detention passed under Section 129(1) of the UPGST Act, 2017 – HELD - The order of detention passed by the Assistant Commissioner appears to be without jurisdiction, as there was no violation committed by the petitioner, and the goods were found to be in accordance with the invoice. The petitioner's contention that the order of detention was passed illegally ... [Read more]

GST - Validity of order of detention, Uploading of the notice on common portal, Passing of ex-parte order - The goods along with the vehicle were intercepted and an order of detention was passed under Section 129(1) of the UPGST Act, 2017 - Validity of the order of detention passed under Section 129(1) of the UPGST Act, 2017 – HELD - The order of detention passed by the Assistant Commissioner appears to be without jurisdiction, as there was no violation committed by the petitioner, and the goods were found to be in accordance with the invoice. The petitioner's contention that the order of detention was passed illegally is prima facie valid - The appellate order rejecting the appeal was passed in an ex-parte manner without serving proper notice to the petitioner regarding the hearing dates. In the judgment of M/s Bambino Agro Industries Ltd v. State of U.P. and others, it was held that mere uploading of the notice on the portal does not amount to proper service of notice, and the order cannot be considered to have been communicated to the petitioner – The impugned orders are set aside and the matter is remitted back to Respondents to pass fresh order strictly in accordance with law – The petition is disposed of [Read less]

Customs – Availment of CVD exemption on import of Manganese Ore – Appellants imported 'Manganese Ore' and classified it under Tariff item 2602 00 20, claiming exemption from payment of CVD in terms of S.No.56 of Notification No.12/2012-CE dated 17.03.2012. The Original Authority and the Commissioner (Appeals) denied the exemption benefit on the ground that the imported goods are not 'Manganese Ores' as they have undergone washing, removal of waste and sizing, and therefore, are 'Manganese Concentrates' - Whether the appellants are eligible for the CVD exemption on imported Manganese Ore – HELD - The processes underta... [Read more]

Customs – Availment of CVD exemption on import of Manganese Ore – Appellants imported 'Manganese Ore' and classified it under Tariff item 2602 00 20, claiming exemption from payment of CVD in terms of S.No.56 of Notification No.12/2012-CE dated 17.03.2012. The Original Authority and the Commissioner (Appeals) denied the exemption benefit on the ground that the imported goods are not 'Manganese Ores' as they have undergone washing, removal of waste and sizing, and therefore, are 'Manganese Concentrates' - Whether the appellants are eligible for the CVD exemption on imported Manganese Ore – HELD - The processes undertaken on the Run of Mine (ROM) ore, such as screening, sizing, crushing, and washing for removal of foreign material, have resulted in the emergence of 'Manganese Concentrates' and not 'Manganese Ores' - The process of converting ores into concentrates would amount to 'manufacture' under the provisions of Chapter Note 4 to Chapter 26. Once the goods are deemed to be 'manufactured' products, they would not be eligible for the exemption notification which is meant for 'Ores' only. The exemption notifications are to be construed strictly, and the benefit thereof should not be extended to the assessee in case of any doubt - Further, the appellants' contention that the processes undertaken were normal and not 'special treatments' is rejected as any activity carried out on the ROM ore with an intent to remove foreign matter, either partially or fully, to make it useful for metallurgical purposes or for economic transport, would amount to conversion and result in the emergence of a new excisable good, i.e., 'Manganese Concentrates' - The orders passed by the Original Authority and the Commissioner (Appeals) are upheld. The appeals are dismissed [Read less]

Service Tax - Taxability of web hosting, domain registration and related services - Demand of service tax on services related to domain registration/renewal, hosting space renewal, hosting space, hosting backup space, and hosting space registration - Whether the services provided by the appellant, such as domain registration and renewal, hosting space renewal, hosting space, hosting backup space, and hosting space registration, are taxable under the category of Information Technology software services – HELD - The services rendered by the appellant, including web hosting, server collocation, and domain name registration,... [Read more]

Service Tax - Taxability of web hosting, domain registration and related services - Demand of service tax on services related to domain registration/renewal, hosting space renewal, hosting space, hosting backup space, and hosting space registration - Whether the services provided by the appellant, such as domain registration and renewal, hosting space renewal, hosting space, hosting backup space, and hosting space registration, are taxable under the category of Information Technology software services – HELD - The services rendered by the appellant, including web hosting, server collocation, and domain name registration, are in the taxable category of information technology software services, which were brought into the statute with effect from 16.05.2008 - The present matter deals with service provided by the appellant under Information Technology service and therefore, the cases relied upon by the appellant are not applicable in this case - The invocation of the extended period of limitation is also upheld as the appellant had not registered with the service tax department and had not filed any returns, which prevented the department from scrutinizing the correctness of the payment of service tax. The conduct of the appellant in not registering and not paying the tax amounts to suppression of facts, making the extended period of limitation invokable - The appellant is liable to pay service tax on the activities of domain registration/renewal, hosting space renewal, hosting space, hosting backup space, and hosting space registration. The matter is remanded to the Original Adjudicating Authority to determine the correct service tax amount, interest liability, and penalty proposals – The appeal is dismissed [Read less]

GST - Cancellation of GST Registration, Non-compliance with Rule 25 of CGST Rules, 2017 and with principles of natural justice - Petitioners argued that the showcause notices did not specify the date and time for personal hearing, thereby violating the principles of natural justice and the physical verification report was not uploaded on the common portal – HELD - The showcause notices were issued in contravention of the provisions of Form GST REG-17, which mandates that the authority issuing the showcause notice must specify the date and time for personal hearing. By not providing this information, the petitioners were ... [Read more]

GST - Cancellation of GST Registration, Non-compliance with Rule 25 of CGST Rules, 2017 and with principles of natural justice - Petitioners argued that the showcause notices did not specify the date and time for personal hearing, thereby violating the principles of natural justice and the physical verification report was not uploaded on the common portal – HELD - The showcause notices were issued in contravention of the provisions of Form GST REG-17, which mandates that the authority issuing the showcause notice must specify the date and time for personal hearing. By not providing this information, the petitioners were denied the opportunity to file a reply and make their submissions. The violation of natural justice at the first stage cannot be cured by the availability of an alternative remedy of appeal, as the Appellate authority cannot remit the matter back to the assessing authority – Further, according to Rule 25 of CGST Rules, 2017, it is necessary to upload the physical verification report alongwith other documents including photographs on the common portal within a period of 15 working days following the date of such verification. The failure to upload the physical verification report on the common portal within the prescribed timeline is in contravention of Rule 25 of the CGST Rules - The showcause notices and the subsequent final orders are quashed. The Respondents shall be at liberty to initiate fresh proceedings against the petitioners strictly in accordance with REG-17, Rule 25 of CGST Rules, 2017 – The writ petitions are allowed [Read less]

GST – Liability to payment of GST absence issue of invoice, Levy of Interest – Petitioner entered into a lease agreement with the Respondent for a plot of land - Respondent upon receiving the request by the petitioner to transfer the land to another party, called upon the petitioners to pay transfer charges and along with the transfer charges to pay outstanding GST with interest - Petitioners challenge the levy of interest on the delayed payment of GST - Whether the Respondent was justified in levying interest on the petitioners for the delayed payment of GST – HELD - As per the provisions of Section 39 of the CGST A... [Read more]

GST – Liability to payment of GST absence issue of invoice, Levy of Interest – Petitioner entered into a lease agreement with the Respondent for a plot of land - Respondent upon receiving the request by the petitioner to transfer the land to another party, called upon the petitioners to pay transfer charges and along with the transfer charges to pay outstanding GST with interest - Petitioners challenge the levy of interest on the delayed payment of GST - Whether the Respondent was justified in levying interest on the petitioners for the delayed payment of GST – HELD - As per the provisions of Section 39 of the CGST Act, 2017 and Rule 61 of the CGST Rules, 2017, the responsibility to pay GST within the prescribed time frame was upon the respondent, the service provider. Further, as per Rule 46 and Rule 47 of the CGST Rules, the respondent was duty-bound to issue the tax invoice within 30 days from the date of supply of service. However, the respondent failed to issue the invoice - The expectation of Respondent-service provider that the petitioners-service recipient should have paid the GST voluntarily as per the lease agreement is contrary to the provisions of law. The Section 122 of the CGST Act imposes a penalty on the taxable person (respondent) for not issuing a tax invoice, and Section 50 of the CGST Act provides that the interest on delayed payment of tax is to be paid by the person liable to pay the tax (respondent), not the recipient (petitioners) - The respondent is directed to refund the amount recovered from the petitioners towards interest within six weeks, failing which the respondent shall pay interest at 18% per annum from the date the amount was recovered until it is paid to the petitioners. The respondent is at liberty to recover the amount of interest from the erring official – The writ petition is allowed [Read less]

Tamil Nadu VAT Act, 2006 - Validity of revision proceedings initiated contrary to remand order of appellate authority - Appellate authority had earlier passed remand orders directing the assessing authority to re-examine certain aspects of the assessments. However, the assessing authority issued fresh notices seeking to revise the assessments, going against the directions in the remand orders - Whether the assessing authority was competent to issue the impugned revision notices contrary to the remand orders passed by the appellate authority – HELD - The assessing authority was not competent to issue the impugned revision... [Read more]

Tamil Nadu VAT Act, 2006 - Validity of revision proceedings initiated contrary to remand order of appellate authority - Appellate authority had earlier passed remand orders directing the assessing authority to re-examine certain aspects of the assessments. However, the assessing authority issued fresh notices seeking to revise the assessments, going against the directions in the remand orders - Whether the assessing authority was competent to issue the impugned revision notices contrary to the remand orders passed by the appellate authority – HELD - The assessing authority was not competent to issue the impugned revision notices in violation of the remand orders passed by the Appellate authority as the assessing authority is bound by the directions issued by the Appellate authority in the remand order and cannot take a different view. The impugned notices are issued in contravention of the remand orders and hence, quashed. However, the assessing authority is directed to conclude the proceedings in terms of the remand order passed by the Appellate authority - The impugned revision notices are quashed and the writ petitions are allowed [Read less]

Service Tax – Renting of immovable property – Tax liability – Appellants have rented out their properties for commercial purposes to various lessees as per lease agreements – Appellants have paid service tax under category of Renting of Immovable Property Service in their individual capacities as per their share in properties whenever the threshold limit for exemption had exceeded – Department issued show cause notice alleging that Appellants being an association of persons should discharge service tax liability jointly – Adjudicating authority confirmed demand proposed in show cause notice – Whether Appellan... [Read more]

Service Tax – Renting of immovable property – Tax liability – Appellants have rented out their properties for commercial purposes to various lessees as per lease agreements – Appellants have paid service tax under category of Renting of Immovable Property Service in their individual capacities as per their share in properties whenever the threshold limit for exemption had exceeded – Department issued show cause notice alleging that Appellants being an association of persons should discharge service tax liability jointly – Adjudicating authority confirmed demand proposed in show cause notice – Whether Appellants are liable to pay service tax individually after availing slab exemption or are collectively liable to pay service tax after pooling the entire consideration received as rent – HELD – Facts demonstrate that rent was paid separately to each co-owner with ownership shares being distinct and identifiable and lease payments having accrued directly to each co-owner rather than to any collective entity or association. There is no evidence to suggest joint management of property by co-owners. Appellants are entitled to be assessed separately for Service Tax in respect of their respective shares of rental income from property. Appellants as co-owners cannot be regarded as an association of persons for purpose of joint assessment of their total rental income under Service Tax. Each Appellant is entitled to individual assessment and may avail applicable slab exemption on an individual basis. Impugned orders are set aside – Appeals allowed [Read less]

Customs – Sections 108 and 138C of Customs Act, 1962 – Rules 3 and 12 of Customs Valuation (Determination of Value of Imported Goods) Rules, 2007 – Import of furniture – Rejection of declared value – Demand of differential duty – Appellant filed Bills of Entry for clearance of imported furniture and its parts thereof – After investigation, Principal Commissioner rejected declared value of imported goods under Rule 12 of the Rules, re-determined same under Rule 3 of the Rules and confirmed demand of differential customs duty – Whether statements of persons recorded under Section 108 of the Act could have bee... [Read more]

Customs – Sections 108 and 138C of Customs Act, 1962 – Rules 3 and 12 of Customs Valuation (Determination of Value of Imported Goods) Rules, 2007 – Import of furniture – Rejection of declared value – Demand of differential duty – Appellant filed Bills of Entry for clearance of imported furniture and its parts thereof – After investigation, Principal Commissioner rejected declared value of imported goods under Rule 12 of the Rules, re-determined same under Rule 3 of the Rules and confirmed demand of differential customs duty – Whether statements of persons recorded under Section 108 of the Act could have been relied upon by Principal Commissioner for rejecting the transaction value – HELD – According to Principal Commissioner, statements made under Section 108 of the Act were sufficient to establish that Appellant had mis-declared and undervalued the imported goods to evade payment of customs duty. Impugned order also places reliance upon invoices retrieved from email of supplier. Principal Commissioner had specifically relied upon statements and invoices retrieved from email of supplier, but there is no finding regarding compliance of Section 138C of the Act. In view of aforesaid discussions, it has to be held that statements of persons recorded under Section 108 of the Act could not have been relied upon by Principal Commissioner for rejecting the transaction value and re-determining the same. Impugned order passed by Principal Commissioner is set aside – Appeals allowed [Read less]

Customs – Import of goods – Classification – Appellant submitted Bills of Entry for clearance of imported goods described as Vitamin E 50% Feed Grade by classified same under CTH 2309 – Department issued show cause notice proposing to reclassify imported goods under CTH 2936 and demand short levied duty – Commissioner confirmed proposals made in show cause notice – Whether impugned goods are classifiable under CTH 2936 as held in impugned order or under CTH 2309 as claimed by Appellant – HELD – Heading 23.09 deals with preparation of a kind used in animal feeding and Chapter 29.36 deals with provitamins and... [Read more]

Customs – Import of goods – Classification – Appellant submitted Bills of Entry for clearance of imported goods described as Vitamin E 50% Feed Grade by classified same under CTH 2309 – Department issued show cause notice proposing to reclassify imported goods under CTH 2936 and demand short levied duty – Commissioner confirmed proposals made in show cause notice – Whether impugned goods are classifiable under CTH 2936 as held in impugned order or under CTH 2309 as claimed by Appellant – HELD – Heading 23.09 deals with preparation of a kind used in animal feeding and Chapter 29.36 deals with provitamins and vitamins, natural or reproduced by synthesis, derivatives thereof used primarily as vitamins and intermixtures etc. Imported vitamins are specifically formulated for animal feed and are labelled for animal use only. There being no certificate from Chemical Examiner to show either the impugned goods are pure chemicals or are mixture concentrates or pre-mixes, benefit of classification must go to Appellant. Impugned goods, being animal feed preparations, are classifiable under Tariff Item 2309 as claimed by Appellant. Impugned order classifying the imported goods under heading 29.36 does not stand the scrutiny of law and therefore is not legally sustainable. Order under challenge is set aside – Appeal allowed [Read less]

GST - Voluntary Cancellation of GST registration and subsequent tax liability – Petitioner applied for voluntary cancellation of its GST registration indicating zero tax liability - Department later issued an order imposing tax liability along with penalty on the petitioner - Whether the cancellation of GST registration absolves the petitioner of any existing tax liability for the period prior to the cancellation – HELD - The cancellation of registration does not absolve the taxpayer of any existing liability which may be detected for the period prior to the cancellation, as per Section 29(3) of the CGST Act, 2017. The... [Read more]

GST - Voluntary Cancellation of GST registration and subsequent tax liability – Petitioner applied for voluntary cancellation of its GST registration indicating zero tax liability - Department later issued an order imposing tax liability along with penalty on the petitioner - Whether the cancellation of GST registration absolves the petitioner of any existing tax liability for the period prior to the cancellation – HELD - The cancellation of registration does not absolve the taxpayer of any existing liability which may be detected for the period prior to the cancellation, as per Section 29(3) of the CGST Act, 2017. The order impugned dealt with tax liability for the period 2018-19 on the ground that the petitioner had failed to declare the correct input/output taxes in its returns, which warranted a notice under Section 73 of the Act. Despite several reminders and opportunities for a personal hearing, the petitioner did not file any reply. Therefore, the assessing authority proceeded to impose the tax and penalty for the relevant period - The impugned order did not suffer from any infirmity that required interference for reconsideration. However, the petitioner is granted the liberty to prefer an appeal against the order, taking all grounds of law and facts, within a period of two weeks with the statutory pre-deposit, and the appellate authority would consider it in accordance with law - The writ petition is disposed of [Read less]

Customs – Section 111 of Customs Act, 1962 – Confiscation of watches – Demand of duty – Officers searched showrooms of Appellant and seized watches of foreign origin – After following due process of law, Principal Commissioner ordered for confiscation of seized watches under Section 111 of the Act with option to release same on payment of redemption fine and confirmed demand of customs duty – Whether Principal Commissioner has erred in holding that watches were smuggled by Appellant – HELD – Allegation against Appellant is that serial numbers were not mentioned in Bills of Entry and therefore, there was not... [Read more]

Customs – Section 111 of Customs Act, 1962 – Confiscation of watches – Demand of duty – Officers searched showrooms of Appellant and seized watches of foreign origin – After following due process of law, Principal Commissioner ordered for confiscation of seized watches under Section 111 of the Act with option to release same on payment of redemption fine and confirmed demand of customs duty – Whether Principal Commissioner has erred in holding that watches were smuggled by Appellant – HELD – Allegation against Appellant is that serial numbers were not mentioned in Bills of Entry and therefore, there was nothing to relate subject watches to watches that had been imported through Bills of Entry. When these watches were imported, there was no requirement of mentioning serial number of watches in Bills of Entry. Customs officers had examined the watches and import documents with reference to model numbers mentioned in import documents and thereafter cleared the watches. Watches were imported prior to 2012 and were duly entered in stock register of Appellant. Principal Commissioner committed an error in holding that watches were smuggled by Appellant. Impugned order passed by Principal Commissioner is set aside – Appeals allowed [Read less]

Service Tax – Section 85 of Finance Act, 1994 – Demand of tax – Filing of appeal – Dismissal on ground of limitation – Appellants are engaged in providing Information technology design and development services – On basis of data received from income tax department, Revenue issued show cause notice alleging that applicable service tax at rate of 12.36% had not been paid by Appellants – Assistant Commissioner confirmed demand proposed in show cause notice – Commissioner (Appeals) dismissed appeal filed by Appellants on ground of limitation – Whether impugned order rejecting appeal as having been filed beyon... [Read more]

Service Tax – Section 85 of Finance Act, 1994 – Demand of tax – Filing of appeal – Dismissal on ground of limitation – Appellants are engaged in providing Information technology design and development services – On basis of data received from income tax department, Revenue issued show cause notice alleging that applicable service tax at rate of 12.36% had not been paid by Appellants – Assistant Commissioner confirmed demand proposed in show cause notice – Commissioner (Appeals) dismissed appeal filed by Appellants on ground of limitation – Whether impugned order rejecting appeal as having been filed beyond time limit prescribed under Section 85 of the Act is correct or not, in terms of facts of present case – HELD – Appellants being aggrieved by Order-in-Original passed by Assistant Commissioner have filed appeal before Commissioner (Appeals) on 28-3-2023. Appeal should have been preferred by Appellants before Commissioner (Appeals) within 22-3-2023, by calculating the normal appeal period of two months from date of receipt of order with which they were aggrieved with. In terms of proviso to Section 85(3A) of the Act, Commissioner (Appeals) can condone delay for a further period of one month, if Appellant shows that they were prevented by sufficient cause from presenting appeal within aforesaid period of two months. Reasons claimed by Appellants such as recreation of service tax login details from departmental portal and making arrangements for pre-deposit in view of change in name of Appellant company qualify for being ‘sufficient cause’ for condoning the delay. There is no merits in impugned order of Commissioner (Appeals) in rejecting appeal filed by Appellants on ground of non-filing of appeal before prescribed time limit. Impugned order passed by Commissioner (Appeals) is set aside – Appeal allowed [Read less]

Service Tax Liability for Rental Income – Appellant is engaged in manufacturing excisable goods and has also rented out certain premises. During an audit, Department observed a difference between the rental income shown in the appellant's Profit & Loss account and the ST-3 returns filed - Whether the appellant is liable to pay service tax on the differential rental income – HELD - The appellant had duly accounted for the rental income in its financial records, including the rental income from residential quarters provided to its employees at the Sikkim project, which is exempt from service tax. The authorities below ha... [Read more]

Service Tax Liability for Rental Income – Appellant is engaged in manufacturing excisable goods and has also rented out certain premises. During an audit, Department observed a difference between the rental income shown in the appellant's Profit & Loss account and the ST-3 returns filed - Whether the appellant is liable to pay service tax on the differential rental income – HELD - The appellant had duly accounted for the rental income in its financial records, including the rental income from residential quarters provided to its employees at the Sikkim project, which is exempt from service tax. The authorities below had not properly considered the detailed submissions and documents provided by the appellant. There is no merit in invoking deliberate suppression, as the entire details of rental income had been duly accounted for - The impugned order is set aside and the appeal is allowed in favor of appellant [Read less]

Central Excise – Demand of credit – Sustainability – Appellant is engaged in manufacture of Ball Bearing – Appellant was availing CENVAT credit on inputs, capital goods and input services under the Rules – Department issued show cause notice, proposing demand of ineligible CENVAT availed by Appellant pertaining to trading activity and services which are not eligible input services, by invoking extended period of limitation – Adjudicating authority confirmed demand proposed in show cause notice – Whether demand confirmed by invoking extended period of limitation is sustainable – HELD – As regards invoking ... [Read more]

Central Excise – Demand of credit – Sustainability – Appellant is engaged in manufacture of Ball Bearing – Appellant was availing CENVAT credit on inputs, capital goods and input services under the Rules – Department issued show cause notice, proposing demand of ineligible CENVAT availed by Appellant pertaining to trading activity and services which are not eligible input services, by invoking extended period of limitation – Adjudicating authority confirmed demand proposed in show cause notice – Whether demand confirmed by invoking extended period of limitation is sustainable – HELD – As regards invoking the demand by confirming extended period of limitation, Appellant have a strong case specifically, since disputes were pending regarding trading activity. As evident from registration, premises of Appellant were registered and returns were filed for relevant period. Demand confirmed by Adjudicating authority by invoking extended period of limitation is unsustainable. As regards demand for normal period, though there are various conflicting decisions, it is settled that trading activities have to be included in turnover. Appellant is directed to produce work sheet certified by Chartered Accountant confirming the consideration involved in trading of goods and thereafter Adjudicating authority shall verify records and finalize the demand accordingly. Impugned order passed by Adjudicating authority is modified – Appeal partly allowed [Read less]

GST - Waiver of interest and penalty – Petitioner seeking waiver of interest and penalty under Section 128A of the CGST Act, 2017 – HELD - A part of the demand may have to be dropped in view of the statutory intervention by way of insertion of Sections 16(5) and 16(6) with retrospective effect from 01.07.2017. The remaining tax liability appears to pertain to availing of ineligible Input Tax Credit - The matter back to the second respondent to examine whether the petitioner was otherwise entitled to the Input Tax Credit but for the belated availment. The second respondent to pass appropriate orders on merits as expedit... [Read more]

GST - Waiver of interest and penalty – Petitioner seeking waiver of interest and penalty under Section 128A of the CGST Act, 2017 – HELD - A part of the demand may have to be dropped in view of the statutory intervention by way of insertion of Sections 16(5) and 16(6) with retrospective effect from 01.07.2017. The remaining tax liability appears to pertain to availing of ineligible Input Tax Credit - The matter back to the second respondent to examine whether the petitioner was otherwise entitled to the Input Tax Credit but for the belated availment. The second respondent to pass appropriate orders on merits as expeditiously as possible – The writ petition is disposed of [Read less]

GST – Best Judgement Assessment - Petitioner had not filed his GST returns for the months of March-2023 to May-2023 within the prescribed time. Consequently, the assessing authority passed assessment orders under Section 62 of the CGST Act, 2017. The petitioner later filed the returns along with payment of tax, interest, and late fee - Whether the provisions of Section 62(2) of the GST Act would be applicable for the month of May 2023, where the returns were filed within 120 days, and the assessment order would be deemed to have been withdrawn – HELD - Though the amendment to Section 62, extending the time limit from 6... [Read more]

GST – Best Judgement Assessment - Petitioner had not filed his GST returns for the months of March-2023 to May-2023 within the prescribed time. Consequently, the assessing authority passed assessment orders under Section 62 of the CGST Act, 2017. The petitioner later filed the returns along with payment of tax, interest, and late fee - Whether the provisions of Section 62(2) of the GST Act would be applicable for the month of May 2023, where the returns were filed within 120 days, and the assessment order would be deemed to have been withdrawn – HELD - Though the amendment to Section 62, extending the time limit from 60 days to 120 days, came into effect subsequently, the said amendment would operate retrospectively and enure to the benefit of the petitioner for the month of March 2023 - For the month of May 2023, the filing of returns and payment of necessary dues were completed within the period of 120 days along with payment of late fee, and therefore, the provisions of Section 62(2) of the GST Act would be applicable, and the impugned assessment would be deemed to have been withdrawn – The writ petition is allowed [Read less]