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GST – Imposition of Personal Penalty under Section 122(1A) of the CGST Act, 2017 - The Petitioners, who were the Chief Financial Officer, Chief Executive Officer and Director & Joint Managing Director of the company imposed with penalties under Section 122(1A) of the CGST Act for the alleged wrongful availment and utilisation of input tax credit by the company - Whether the show cause notices and the impugned order-in-original imposing penalties on the petitioners under Section 122(1A) of the CGST Act are sustainable in law and within jurisdiction of the authorities – HELD - The Section 122(1A) of the CGST Act specific... [Read more]

GST – Imposition of Personal Penalty under Section 122(1A) of the CGST Act, 2017 - The Petitioners, who were the Chief Financial Officer, Chief Executive Officer and Director & Joint Managing Director of the company imposed with penalties under Section 122(1A) of the CGST Act for the alleged wrongful availment and utilisation of input tax credit by the company - Whether the show cause notices and the impugned order-in-original imposing penalties on the petitioners under Section 122(1A) of the CGST Act are sustainable in law and within jurisdiction of the authorities – HELD - The Section 122(1A) of the CGST Act specifically applies to a 'taxable person' as defined under Section 2(107) of the CGST Act, namely who is liable to be registered under Section 22 or Section 24 of the CGST Act and who retains the benefit of the transactions covered under clauses (i), (ii), (vii) or clause (ix) of Section 122(1) and at whose instance such transactions are conducted. Unless such two-fold requirement is fulfilled, it would not be possible to recognize any jurisdiction being available in the proper officer to invoke the said provision - The petitioners, being employees of the company, cannot be considered as 'taxable persons' under the CGST Act – Further, the provisions of Section 122(1A) cannot be invoked against the petitioners who are merely employees of the company and not 'taxable persons' - The retrospective application of Section 122(1A) for the period prior to its effective date of 1st January 2021 would be in violation of Article 20(1) of the Constitution as a person cannot be penalized under the provision which was not in force for the period in which such alleged acts are stated to have been committed - the impugned show cause notices and order-in-original issued against the petitioners are quashed – The writ petition is allowed - Legislative intent of Section 122(1A) - The legislative intent of sub-section (1A) is quite clear, as necessarily clauses (i), (ii), (vii) or clause (ix) of sub-section (1) are required to be conjointly read with Section (1A), which itself stands incorporated in the provision. Hence, the opening words of sub-section (1A) when it uses the words “any person”, it would be required to be understood in the context of a ‘taxable person’ as sub-section (1) itself applies to a taxable person. In the absence of such interpretation, find it difficult as to how the provisions of clauses (i), (ii), (vii) or clause (ix) of sub-section (1) of Section 122 can at all apply, so as to give effect and/or in invoking/implementing the provision of sub-section (1A) of Section 122 of the CGST Act - It is clear from the facts of the case that an action was initiated against a company namely M/s. Shemaroo Entertainment Ltd. It is not in dispute that the petitioners who for the period in question, were the Chief Financial Officer, Chief Executive Officer and Director & Joint Managing Director, being employees of the company could not be held liable for a penalty to be imposed under the provisions of Section 122(1A). [Read less]

Uttar Pradesh VAT Act, 2008 - Classification of product "Sharbat Rooh Afza", “Fruit Drink” or “Processed Fruit” - The appellant-assessee manufactures and sells the product "Sharbat Rooh Afza" which contains 10% fruit juice. The appellant claimed the product as a "fruit drink" classifiable under Entry 103 of Schedule II Part A of the UPVAT Act, attracting 4% VAT – The authorities classified it under the residuary entry in Schedule V, levying 12.5% VAT – Vide the impugned order the High Court affirmed the classification under the residuary entry - HELD - The product "Sharbat Rooh Afza" is classifiable as a "fruit... [Read more]

Uttar Pradesh VAT Act, 2008 - Classification of product "Sharbat Rooh Afza", “Fruit Drink” or “Processed Fruit” - The appellant-assessee manufactures and sells the product "Sharbat Rooh Afza" which contains 10% fruit juice. The appellant claimed the product as a "fruit drink" classifiable under Entry 103 of Schedule II Part A of the UPVAT Act, attracting 4% VAT – The authorities classified it under the residuary entry in Schedule V, levying 12.5% VAT – Vide the impugned order the High Court affirmed the classification under the residuary entry - HELD - The product "Sharbat Rooh Afza" is classifiable as a "fruit drink" under Entry 103 of Schedule II Part A of the UPVAT Act, attracting 4% VAT. The Revenue failed to discharge the burden of proving the product falls outside Entry 103, which is a specific and inclusive entry. The expression “fruit drink” occurring in Entry 103 cannot be confined solely to ready-to-consume bottled beverages – Applying the common parlance test and the essential character test, the fruit content and traditional beverage character of the product reasonably fit within the description of a "fruit drink", despite the sugar syrup being the predominant ingredient. The product has been classified as a fruit drink and taxed at concessional rates in several other States, indicating a commercially recognized interpretation – Regulatory classification under food safety legislation cannot solely govern interpretation of an undefined fiscal entry under the UPVAT Act. It is well settled that where the Revenue seeks to classify a product under a residuary or entry different from that claimed by the assessee, the burden lies squarely upon it. Classification relates directly to chargeability; therefore, the onus of establishing applicability of a taxing entry rests upon the Department - The recourse to a residuary clause is permissible only when the goods cannot reasonably be brought within the ambit of any specific entry. Such inability must be established by the Revenue on the basis of relevant material; the residuary entry cannot be invoked merely because the specific entry is construed narrowly or because some ambiguity is perceived - Once it is demonstrated that the product is a fruit-based beverage preparation intended for dilution and consumption, it bears a reasonable and substantial claim to classification as a “fruit drink” within Entry 103. It cannot be relegated to the residuary entry merely because it is marketed as a “sharbat” - The “Sharbat Rooh Afza” is classifiable under Entry 103 of Schedule II, Part A of the UPVAT Act as a fruit drink / processed fruit product and is exigible to VAT at the concessional rate of 4% during the relevant assessment years. The impugned judgments affirming classification under the residuary entry and levy at 12.5% are set aside – The appeal is allowed [Read less]

Customs – Transaction Value Variation due to Discharge Money, Refund of duty - import of coal/coke - The appellant had entered into long-term contracts with foreign exporters on a CIF basis - Whether transaction value will get varied on receipt of discharge money from the foreign supplier and whether the same is includible in transaction value - HELD - The agreement between the parties included a clause providing for dispatch money either as a penalty to the buyer for delay in discharge or as an incentive to the buyer for efficient discharge of the cargo. The terms are commercial terms in international trade and cannot b... [Read more]

Customs – Transaction Value Variation due to Discharge Money, Refund of duty - import of coal/coke - The appellant had entered into long-term contracts with foreign exporters on a CIF basis - Whether transaction value will get varied on receipt of discharge money from the foreign supplier and whether the same is includible in transaction value - HELD - The agreement between the parties included a clause providing for dispatch money either as a penalty to the buyer for delay in discharge or as an incentive to the buyer for efficient discharge of the cargo. The terms are commercial terms in international trade and cannot be said to be unusual. The quantum of the incentive was reasonable and could not be considered as a means for undervaluation by the importer-appellant – The impugned order is set aside and the appeal is allowed [Read less]

Service Tax - Eligibility for Service Tax Notification Exemption - Construction of an office-cum-commercial complex and residential complex for Government of Meghalaya. For the period prior to June 2012, the appellant availed the benefit of Notification No. 01/2006-ST dated 01.03.2006 and paid service tax at the rate of 33% of the gross taxable value - Revenue authorities denied this benefit alleging that the appellant had availed CENVAT credit on input services – HELD - The appellant had reversed the CENVAT credit availed along with interest, and therefore, the benefit of Notification No. 01/2006-ST dated 01.03.2006 can... [Read more]

Service Tax - Eligibility for Service Tax Notification Exemption - Construction of an office-cum-commercial complex and residential complex for Government of Meghalaya. For the period prior to June 2012, the appellant availed the benefit of Notification No. 01/2006-ST dated 01.03.2006 and paid service tax at the rate of 33% of the gross taxable value - Revenue authorities denied this benefit alleging that the appellant had availed CENVAT credit on input services – HELD - The appellant had reversed the CENVAT credit availed along with interest, and therefore, the benefit of Notification No. 01/2006-ST dated 01.03.2006 cannot be denied to the appellant for the period prior to June 2012. The appellant had paid the service tax under the Works Contract Services during this period - For the period post June 2012, the revenue authorities denied the benefit of Notification No. 26/2012-ST dated 20.06.2012 on the ground that the land belonged to the Government of Meghalaya and the property was not intended for sale - In terms of Rule 2A(ii) of the Service Tax (Determination of Value) Rules, 2006, as amended by Notification No. 24/2012-ST dated 06.06.2012, the appellant was entitled to avail the benefit of abatement of 60% of the total value received, as they were involved in the service of construction along with materials. The appellant had paid the differential service tax along with interest, and therefore, the demand of service tax under construction service post 2012 is also not sustainable - The demands confirmed against the appellant in the impugned order are set aside and the appeal is allowed [Read less]

Central Excise - Invocation of extended period of limitation – Demand of duty on the basis of difference in the figures shown in the ER-1 and ER-4 returns. A show cause notice was issued to the appellants demanding central excise duty along with interest and penalties by invoking the extended period of limitation - Whether the extended period of limitation can be invoked in this case - HELD - The extended period of limitation cannot be invoked in this case as the figures shown by the appellants in their ER-1 and ER-4 returns, filed in time, were well within the knowledge of the revenue. The ER-4 returns are nothing but a... [Read more]

Central Excise - Invocation of extended period of limitation – Demand of duty on the basis of difference in the figures shown in the ER-1 and ER-4 returns. A show cause notice was issued to the appellants demanding central excise duty along with interest and penalties by invoking the extended period of limitation - Whether the extended period of limitation can be invoked in this case - HELD - The extended period of limitation cannot be invoked in this case as the figures shown by the appellants in their ER-1 and ER-4 returns, filed in time, were well within the knowledge of the revenue. The ER-4 returns are nothing but average financial statements of the appellant-company, on the basis of which the demand cannot be raised without supporting evidence - The clearances were shown by the appellant-company in their ER-1 returns, on which they have paid duty, which are the actual 'sales'. In the absence of any allegation that the appellants have received any amount over and above that shown in their transaction value and ER-1 returns, the demand confirmed against the appellants is based on assumptions and presumptions - The impugned order is set aside and the appeal is allowed [Read less]

Central Excise - Valuation of excisable goods (medicament) - Department relied on sample invoices to allege that the appellant had adopted a much lower value for payment of duty than the declared MRP. It was also alleged that the average sale price of the appellant's products during certain periods was much higher than the declared sale price, resulting in probable escapement of duty - Whether the Department can adopt the average sale price of one period to demand differential duty for an earlier or subsequent period - HELD - The valuation of excisable goods under the Central Excise Act, 1944 is governed by Section 4, whic... [Read more]

Central Excise - Valuation of excisable goods (medicament) - Department relied on sample invoices to allege that the appellant had adopted a much lower value for payment of duty than the declared MRP. It was also alleged that the average sale price of the appellant's products during certain periods was much higher than the declared sale price, resulting in probable escapement of duty - Whether the Department can adopt the average sale price of one period to demand differential duty for an earlier or subsequent period - HELD - The valuation of excisable goods under the Central Excise Act, 1944 is governed by Section 4, which provides that the assessable value shall be the transaction value, i.e. the price actually paid or payable for the goods sold. Any subsequent reduction in price, for commercial reasons, cannot be a concern for the Department regarding the original duty paid at the time of clearance. Therefore, a lower average sale price in a subsequent period, by itself, is not proof of duty evasion. The law does not permit retrospective imputation of value based on comparative analysis alone. The valuation must be grounded in documented agreements, invoices and contemporaneous evidence relevant to each removal – Further, allegation of undervaluation and clandestine removal is a serious allegation which needs to be substantiated through tangible, direct, affirmative and incontrovertible evidence. In the present case, the Department has relied solely on sample invoices without bringing any other evidence to prove its contentions. The verification conducted by the Department also did not reveal any evidence of clandestine removal or dual pricing by the appellant. Therefore, the allegation of undervaluation and clandestine removal is not sustainable - The demand of central excise duty, interest and penalties confirmed in the impugned order is set aside. The denial of SSI exemption to the appellant is also not legally sustainable – The appeal is allowed [Read less]

Service Tax - Taxability of power transmission and distribution activities and related services - Appellant is a DISCOM (electricity distribution company) engaged in the distribution of electricity - DGGI issued notice demanding service tax on the appellant's activities, alleging wilful fraud, wilful misstatement and suppression of facts to evade payment of tax - Whether the power transmission and distribution activities and related services provided by the appellant are exempt from service tax – HELD - The Gujarat High Court in Torrent Power Ltd. vs Union of India has held that the activities related and ancillary to tr... [Read more]

Service Tax - Taxability of power transmission and distribution activities and related services - Appellant is a DISCOM (electricity distribution company) engaged in the distribution of electricity - DGGI issued notice demanding service tax on the appellant's activities, alleging wilful fraud, wilful misstatement and suppression of facts to evade payment of tax - Whether the power transmission and distribution activities and related services provided by the appellant are exempt from service tax – HELD - The Gujarat High Court in Torrent Power Ltd. vs Union of India has held that the activities related and ancillary to transmission and distribution of electricity are exempt from service tax as they are naturally bundled with the main service of transmission and distribution of electricity, which is itself exempt. The meaning of "transmission and distribution of electricity" does not change for the negative list regime or the GST regime, and the services which were considered as part of the main service during the pre-negative list regime cannot be excluded now. The legislative intent behind the exemptions provided for power transmission and distribution activities, including the ancillary services, from 2010 onwards. Accordingly, the demand of service tax on the appellant's activities and related services is set aside and the appeal is allowed - Whether the extended period of limitation can be invoked in the present case - HELD - The Revenue could not establish conclusively that the appellant had suppressed material facts with an intention to evade payment of service tax. The extended period of limitation can be invoked only when the "suppression" is shown to be wilful and with an intent to evade payment of duty. In the present case, only a general statement was made by the Commissioner about the appellant's wilful misstatement, without any conclusive evidence. Therefore, it is not possible to sustain the demand made for the extended period of limitation - The demand for the extended period of limitation is also set aside. [Read less]

Service Tax - Business Exhibition Service, Principle of Mutuality - Appellant buys space in overseas business exhibitions for its members to participate and receives payment from the members – Demand of service tax on the amounts received from the members for facilitating their participation in the overseas business exhibitions - Whether the appellant is liable to pay service tax on the amounts received from its members for facilitating their participation in overseas business exhibitions - HELD - The appellant had merely facilitated participation of its members in business exhibitions organized abroad by others and did ... [Read more]

Service Tax - Business Exhibition Service, Principle of Mutuality - Appellant buys space in overseas business exhibitions for its members to participate and receives payment from the members – Demand of service tax on the amounts received from the members for facilitating their participation in the overseas business exhibitions - Whether the appellant is liable to pay service tax on the amounts received from its members for facilitating their participation in overseas business exhibitions - HELD - The appellant had merely facilitated participation of its members in business exhibitions organized abroad by others and did not organize any business exhibition itself. There was no organizer-exhibitor relationship established between the appellant and its members. Consequently, the activity did not fall within the definition of "business exhibition service" under the Finance Act, 1994 – Further, the appellant is a non-Government, not-for-profit, industry-led and industry-managed organization with members from the private and public sectors. Being a confederation of industry members, the mutuality principle as laid down by the Supreme Court in State of West Bengal vs. Calcutta Club applies, wherein it was held that no distinct service provider-receiver relationship exists in mutual setups, and associations like the appellant render "self-service" to its members - Accordingly, the activity of the appellant in facilitating participation of its members in overseas business exhibitions is not subject to service tax under the principle of mutuality – The demand of service tax on the amounts received by the appellant for facilitating participation of its members in overseas business exhibitions is set aside and the appeal is allowed - Service Tax on Accrual Basis vs Cash Basis – Demand of service tax based on the balance sheet figures prepared on accrual basis, whereas the appellant had paid service tax on cash receipt basis - Whether the service tax demand based on balance sheet figures prepared on accrual basis is valid when the appellant had paid service tax on cash receipt basis - HELD - The appellant had contended that service tax was payable on cash receipt basis prior to 2011, whereas the balance sheet was prepared on accrual/mercantile basis, leading to a difference between the ST-3 returns and the balance sheet figures. The appellant had also submitted that the figures in the balance sheet reflect the income and expenditure of the organization and have no bearing on the service tax liability or payment - No evidence was led by the appellant to substantiate their contentions. Consequently, it would be appropriate to remand this issue to the original authority for fresh consideration, granting sufficient opportunity to the appellant to submit relevant records and documents to support their case - The issue regarding the demand based on balance sheet figures prepared on accrual basis is remanded for reconsideration by the adjudicating authority [Read less]

Service Tax - Rejection of VCES declaration - Department rejected the declaration relying on the second proviso to Section 106(1) of the Finance Act, 2013, as there were earlier show cause notices issued to the appellant for non-payment of service tax on royalty charges received from the Assaying and Hallmark centres - Whether the rejection of the VCES declaration filed by the appellant is tenable – HELD - The "issue" involved in the earlier show cause notices issued to the appellant for the period prior to 01-07-2012 was whether the appellant was the holder of 'intellectual property right' rendering service to the Hallm... [Read more]

Service Tax - Rejection of VCES declaration - Department rejected the declaration relying on the second proviso to Section 106(1) of the Finance Act, 2013, as there were earlier show cause notices issued to the appellant for non-payment of service tax on royalty charges received from the Assaying and Hallmark centres - Whether the rejection of the VCES declaration filed by the appellant is tenable – HELD - The "issue" involved in the earlier show cause notices issued to the appellant for the period prior to 01-07-2012 was whether the appellant was the holder of 'intellectual property right' rendering service to the Hallmarking/Assaying Centers in relation to intellectual property service so as to come within the ambit of "intellectual property service" as defined in Section 66 (105) (zzr) of the Finance Act, 1994. However, for the period July 2012 to December 2012, for which the appellant filed the VCES declaration, the "issue" was whether allowing the Hallmarking/Assaying Centres to administer the BIS Scheme upon payment of royalty itself constituted 'service' as defined under Section 65B(44) of the Finance Act 1994 so as to attract the charge of service tax under Section 66B - The "issue" involved for the period prior to 01-07-2012 and the period for which the VCES declaration was filed were different, and hence the second proviso to Section 106(1) of the Finance Act, 2013 is not applicable in the instant case - For the particular distinct period of July 2012 to December 2012, the subject matter of the declaration, the issue is not pending and therefore the declaration ought not to have been rejected - The order rejecting the VCES declaration filed by the appellant is set aside and the appeal is allowed [Read less]

Customs - Classification of Goods - The appellant imported women's jackets that were declared as "knitted jackets" but upon examination were found to be made of woven fabrics - Whether the subject goods should be classified under Chapter 61 (for knitted or crocheted articles) or Chapter 62 (for articles not knitted or crocheted) of the Customs Tariff – HELD - Since the jackets were made of woven fabrics, they should be classified under Chapter 62 and the appropriate heading would be 6202 93 90. The Chapter 61 covers articles of apparel and clothing accessories that are knitted or crocheted, while Chapter 62 covers those ... [Read more]

Customs - Classification of Goods - The appellant imported women's jackets that were declared as "knitted jackets" but upon examination were found to be made of woven fabrics - Whether the subject goods should be classified under Chapter 61 (for knitted or crocheted articles) or Chapter 62 (for articles not knitted or crocheted) of the Customs Tariff – HELD - Since the jackets were made of woven fabrics, they should be classified under Chapter 62 and the appropriate heading would be 6202 93 90. The Chapter 61 covers articles of apparel and clothing accessories that are knitted or crocheted, while Chapter 62 covers those that are not knitted or crocheted. As the jackets were found to be woven and not knitted, they rightly fall under Chapter 62 - The Tribunal rejected the appellant's argument that the more specific heading 6102 30 10 should apply, as that relates to knitted or crocheted jackets - While the goods were correctly re-classified by the department, leading to a demand for differential duty, the elements necessary to invoke the extended period of limitation under Section 28(4) or to impose a penalty under Section 114A, namely fraud, collusion or willful misstatement, are not present. The penalty imposed under Section 114A is set aside, while upholding the demand for differential duty - The appeal is partly allowed [Read less]

Customs - Invocation of extended period of limitation under Section 28(4) of the Customs Act, 1962 - Appellant imported Forcepoint security appliances (servers) and classified them under Customs Tariff Item (CTI) 8471 50 00, claiming the benefit of exemption Notification No. 24/2005-CUS - Department contended that the goods were correctly classifiable under CTI 8517 69 90 and were not eligible for the exemption - Whether the invocation of the extended period of limitation under Section 28(4) of the Customs Act, 1962 is justified - HELD - The extended period of limitation under Section 28(4) can be invoked only if the non-p... [Read more]

Customs - Invocation of extended period of limitation under Section 28(4) of the Customs Act, 1962 - Appellant imported Forcepoint security appliances (servers) and classified them under Customs Tariff Item (CTI) 8471 50 00, claiming the benefit of exemption Notification No. 24/2005-CUS - Department contended that the goods were correctly classifiable under CTI 8517 69 90 and were not eligible for the exemption - Whether the invocation of the extended period of limitation under Section 28(4) of the Customs Act, 1962 is justified - HELD - The extended period of limitation under Section 28(4) can be invoked only if the non-payment or short payment of duty is by reason of collusion or any willful mis-statement or suppression of facts by the importer, with an intent to evade payment of duty. In the present case, there was insufficient evidence to establish the intent to evade on the part of the appellant, as the goods were imported on a Delivery Duty Paid (DDP) basis, and the Bills of Entry were filed by the customs broker appointed by the overseas seller, although using the appellant's Import Export Code (IEC). Therefore, the invocation of the extended period of limitation was not justified - The impugned order is modified by upholding the confirmation of demand of duty with interest within the normal period of limitation, while the demand for the extended period of limitation, confiscation of the goods, imposition of redemption fine, and penalty are set aside - The appeal is partly allowed - Confiscation of goods under Section 111(m) of the Customs Act, 1962 - The Principal Commissioner held the imported goods liable to confiscation under Section 111(m) of the Act, on the ground that the goods did not correspond in respect of the CTI under which they were classified - Whether the confiscation of the goods or holding the goods liable to confiscation under Section 111(m) of the Customs Act, 1962 was justified - HELD - The discrepancy in this case was regarding the CTI under which the imported goods should be classified, and not regarding the goods themselves. Even if the self-assessment of the CTI was incorrect, it cannot be a ground for confiscating the imported goods under Section 111(m) of the Act. Decision: The confiscation of the goods or holding the goods liable to confiscation under Section 111(m) of the Customs Act, 1962 cannot be sustained - Imposition of penalty under Section 114A of the Customs Act, 1962 - Whether the imposition of penalty under Section 114A of the Customs Act, 1962 is justified - HELD - The elements required for imposing penalty under Section 114A are the same as for invoking the extended period of limitation under Section 28(4) of the Act. Since the Tribunal had found that the invocation of the extended period of limitation was not justified, the penalty imposed under Section 114A also needs to be set aside. [Read less]

GST – Scope of Section 130(2) of the CGST Act, 2017 - Provisional Release of confiscated goods - The petitioner challenge the show cause notice proposing confiscation of goods and conveyance under Section 130 of the CGST Act - The petitioner sought the provisional release of the goods by paying the proposed fine in lieu of confiscation under Section 130(2) of the CGST Act - Whether the petitioner is entitled to the provisional release of the goods under Section 130(2) of the CGST Act, pending the adjudication of the confiscation proceedings - HELD – In view of the relevant statutory provisions and the amendments introd... [Read more]

GST – Scope of Section 130(2) of the CGST Act, 2017 - Provisional Release of confiscated goods - The petitioner challenge the show cause notice proposing confiscation of goods and conveyance under Section 130 of the CGST Act - The petitioner sought the provisional release of the goods by paying the proposed fine in lieu of confiscation under Section 130(2) of the CGST Act - Whether the petitioner is entitled to the provisional release of the goods under Section 130(2) of the CGST Act, pending the adjudication of the confiscation proceedings - HELD – In view of the relevant statutory provisions and the amendments introduced by the Finance Act, 2021, the provisional release of goods is not contemplated under Section 130(2) of the CGST Act - What is intended under Section 130(2) is not a provisional release, but it is a release of the goods after confiscation and the amounts to be paid, are determined by way of final order of confiscation by the authority concerned. Nowhere in sub-section (2) of Section 130, any reference with regard to the provisional release of the goods is made - The release of goods under Section 130(2) is upon payment of fine in lieu of confiscation after the final order of confiscation, and not as a provisional measure pending the adjudication. The provisions for provisional release are specifically provided under Section 67(6) of the CGST Act, and the same is conspicuously absent in Section 130. Applying the principle of "expressio unius est exclusio alterius", the legislature's conscious omission of the provisional release provision in Section 130 indicates the legislative intent not to permit such provisional release under that provision. The power of provisional release being specifically provided under Section 67(6), cannot be extended to proceedings under Section 130 in the absence of an express statutory mandate. There is no scope for incorporating the concept of provisional release into Section 130(2) as a provisional measure, pending the adjudication proceedings, by accepting the fine in lieu of the confiscation proposed in the notice issued in Form MOV-10 - However, the respondents cannot retain the possession of the goods merely because the confiscation proceedings under Section 130 are initiated, in the absence of a valid detention order under Section 129 of the CGST Act. The respondents to release the goods upon the petitioner furnishing a simple bond, as the continued detention of the goods is found to be not legally sustainable - Whether the Respondents have the power to retain the goods proposed to be confiscated, until an order of confiscation is passed – HELD - In cases where no order or detention as contemplated under section 129(1) is passed, the officer concerned cannot hold the goods and conveyances in their possession, once the procedure for inspection as contemplated under clause 2(d) and (e) of Circular No.41/15/2018-GST dated 13.4.2018 is expired - A mere direction in Form MOV-2 restraining the person from taking the goods until further orders cannot substitute the requirement of passing an order or detention as provided in section 129(10). Since what is required is “order of detention”; necessarily it must be an order, highlighting the reasons for such detention, and it cannot be in the form of a simple direction - Mere initiation of proceedings under section 130 of the Act, by itself is not an authority for the officer concerned, to retain the goods in possession and such retention of possession can be made, only following the procedure for detention contemplated under section 129 of the Act - Any action of the officer concerned to retain the possession without passing an order of detention as contemplated under the Act would be illegal which would enable the party concerned to seek release of the goods and conveyances. [Read less]

GST – Demand and recovery of Transitional credit claimed under Section 140 of the CGST Act, 2017 – Petitioner challenge the impugned order on the ground that it is against the principles of natural justice as the same having passed without furnishing the copies of verification reports to the Petitioner – HELD - The impugned order was passed in haste, without verifying the entire record/invoices and other documents. The non-furnishing of the verification reports and not granting an opportunity of fair hearing to the petitioner on the same amounted to a breach of the principles of natural justice. The concerned officia... [Read more]

GST – Demand and recovery of Transitional credit claimed under Section 140 of the CGST Act, 2017 – Petitioner challenge the impugned order on the ground that it is against the principles of natural justice as the same having passed without furnishing the copies of verification reports to the Petitioner – HELD - The impugned order was passed in haste, without verifying the entire record/invoices and other documents. The non-furnishing of the verification reports and not granting an opportunity of fair hearing to the petitioner on the same amounted to a breach of the principles of natural justice. The concerned officials had an onerous duty to pass the order only after complete verification of the record and in accordance with law - The impugned order itself recorded that all the invoices could not be verified due to the large stock declared by the petitioner and the petitioner is required to produce the supporting documents, which it had allegedly not provided. However, this observation is contrary to the record, as the petitioner has claimed that it had furnished all the required documents - The entire exercise to pass the impugned order was a hurried one, and the concerned officials should not have resorted to such hasty actions, as it was necessary to provide the petitioner an opportunity to deal with the verification reports before forming an opinion - The impugned order is set aside and matter remanded to the Additional Commissioner for a de novo consideration after providing the petitioner with the verification reports and granting it an opportunity of being heard – The writ petition is allowed [Read less]

Central Excise – Interest on refund of Duty Paid under Protest, Applicable rate of interest - Whether the interest is payable from the date of deposit of the duty, or from the date of expiry of three months after the date of filing the refund application – HELD - The provisions of Section 11B and 11BB of the Central Excise Act, which deal with refund of duty and interest on delayed refunds, are not applicable to the present case as the amount paid was not 'duty' but a deposit made under protest, prior to any adjudication. Unless the amount is appropriated against a confirmed demand through a proper adjudication order, ... [Read more]

Central Excise – Interest on refund of Duty Paid under Protest, Applicable rate of interest - Whether the interest is payable from the date of deposit of the duty, or from the date of expiry of three months after the date of filing the refund application – HELD - The provisions of Section 11B and 11BB of the Central Excise Act, which deal with refund of duty and interest on delayed refunds, are not applicable to the present case as the amount paid was not 'duty' but a deposit made under protest, prior to any adjudication. Unless the amount is appropriated against a confirmed demand through a proper adjudication order, it does not acquire the character of 'duty' and remains merely a deposit, retained without the authority of law. Since the department itself acknowledged that the levy was unsustainable and sanctioned the refund, the amount paid under protest cannot be treated as 'duty' attracting the provisions of Sections 11B and 11BB. Accordingly, the interest is payable from the date of deposit till the date of refund - In the absence of any specific statutory provision prescribing the rate of interest for refund of revenue deposits, the rate of 12% per annum is appropriate. The reliance of the Department on the provisions of Section 11BB and the corresponding Notification prescribing 6% interest rate is misplaced, as the same are inapplicable to the refund of deposits. Denying the rightful interest at 12% per annum would unjustly enrich the State at the expense of the citizen, violating the constitutional rights - The Department is directed to sanction and disburse the balance interest to the assessee at the rate of 12% per annum from the date of deposit till the date of actual refund – The appeal is allowed [Read less]

Central Excise - Clandestine Removal of Goods - Whether the evidence relied upon by the authorities to establish the charge of clandestine removal was legally valid and sufficient - HELD - The evidence relied upon by the authorities, such as cash deposits in bank accounts of certain brokers/intermediaries with handwritten names, was far from credible and lacked proper investigation and corroboration. The mere mention of names in testimonial evidence or derived records cannot form the basis for alleging clandestine removal, and the authorities failed to establish other critical aspects like receipt of unaccounted raw materi... [Read more]

Central Excise - Clandestine Removal of Goods - Whether the evidence relied upon by the authorities to establish the charge of clandestine removal was legally valid and sufficient - HELD - The evidence relied upon by the authorities, such as cash deposits in bank accounts of certain brokers/intermediaries with handwritten names, was far from credible and lacked proper investigation and corroboration. The mere mention of names in testimonial evidence or derived records cannot form the basis for alleging clandestine removal, and the authorities failed to establish other critical aspects like receipt of unaccounted raw materials, excess consumption of electricity, and lack of transport documents. Relying on the decision in Famous Ceramics Industries & Others v. CCE & ST-Rajkot, it is held that the charge of clandestine removal was not proved by the authorities, and consequently, the demands and penalties imposed on the appellants are not sustainable - The appeals are allowed [Read less]

Service Tax - Exemption for Government Construction Projects, Evidentiary Value of Form 26AS - Appellant is engaged in constructing roads and canals for Government and local authorities, claimed exemption under Serial Nos. 12(d) and 13(a) of Notification No. 25/2012-ST - Adjudicating authority confirmed a service tax based on receipts reflected in Form 26AS - Whether service tax can be levied on receipts shown in Form 26AS by disregarding the exempt nature of the underlying services merely because the work orders were initiated in a prior financial year - HELD - The authorities below admitted the services involved road and... [Read more]

Service Tax - Exemption for Government Construction Projects, Evidentiary Value of Form 26AS - Appellant is engaged in constructing roads and canals for Government and local authorities, claimed exemption under Serial Nos. 12(d) and 13(a) of Notification No. 25/2012-ST - Adjudicating authority confirmed a service tax based on receipts reflected in Form 26AS - Whether service tax can be levied on receipts shown in Form 26AS by disregarding the exempt nature of the underlying services merely because the work orders were initiated in a prior financial year - HELD - The authorities below admitted the services involved road and canal construction for government bodies, which are unconditionally exempt under the Mega Exemption Notification. The Revenue proceeded solely on the basis of third-party Income Tax data without examining whether the services were taxable or exempt, and failed to appreciate that the receipts in FY 2015-17 were payments for exempt work orders executed previously. Since the appellant provided a detailed reconciliation linking the payments to specific exempt projects, such as the construction of metalled roads, the demand based on the timing of receipts as per Form 26AS is legally flawed as it ignores the statutory exemption granted to the nature of the activity - Since the demand on merits is set aside due to the availability of statutory exemptions, the consequential penalties and interest cannot survive – Further, there are ingredients of suppression or willful misstatement with intent to evade tax, particularly as the appellant operated under a bona fide belief that their Government-contracted infrastructure work was exempt from tax. Consequently, the invocation of penal provisions and the demand for interest and late fees are held to be unjustified – The impugned order is set aside and the appeal is allowed [Read less]

Service Tax – Denial of Cenvat Credit on the ground that its zonal office, which was located in the same premises, was not registered as an Input Service Distributor (ISD) – HELD - There is no dispute regarding the payment of the service tax in respect of which the credit has been availed nor is the eligibility of such services as input services being disputed. In such circumstances, when it also remains an uncontroverted fact that both the zonal office and the appellant main branch are located in the same building, and administratively when the entire financial requirements of the said zonal office, was being borne by... [Read more]

Service Tax – Denial of Cenvat Credit on the ground that its zonal office, which was located in the same premises, was not registered as an Input Service Distributor (ISD) – HELD - There is no dispute regarding the payment of the service tax in respect of which the credit has been availed nor is the eligibility of such services as input services being disputed. In such circumstances, when it also remains an uncontroverted fact that both the zonal office and the appellant main branch are located in the same building, and administratively when the entire financial requirements of the said zonal office, was being borne by the appellant main branch with the zonal office stated to be having no separate financial transactions or books of accounts, in accordance with the well settled position in law that substantial benefit cannot be denied for technical or venial breaches - The substantial benefit of Cenvat credit cannot be denied for a mere procedural infraction of non-registration of the zonal office as an ISD, especially when the appellant was in possession of invoices with all the requisite details for availing the credit and there was no dispute regarding the eligibility of the input services or the payment of service tax. The denial of Cenvat credit on this ground was unsustainable and set aside - The impugned order is set aside and the appeal is allowed - Restriction of Cenvat Credit on Exempted Services - The show cause notice is bereft of any details or evidence regarding the exempted services provided by the appellant. The appellant had also provided evidence showing that it had not availed the service tax exemption notification. The allegation regarding wrongful utilization of Cenvat credit is unsustainable, as the Department had failed to substantiate the claim of the appellant providing exempted services - There was no evidence of any deliberate or positive act with an intent to evade payment of duty on the part of the appellant, a public sector bank, and hence the invocation of the extended period and imposition of penalty is also unsustainable. [Read less]

Service Tax - Non-payment of service tax, Invocation of Extended Period of Limitation - Appellant had paid the entire service tax demand along with interest before the issuance of the show-cause notice. However, the Adjudicating Authority invoked the extended period of limitation under Section 73(4) of the Finance Act, 1994 and confirmed the demand along with penalties - Whether the invocation of the extended period of limitation and the consequent demand of service tax, interest and penalties were legally tenable – HELD - The show-cause notice did not contain any specific allegation of fraud, collusion, willful misstate... [Read more]

Service Tax - Non-payment of service tax, Invocation of Extended Period of Limitation - Appellant had paid the entire service tax demand along with interest before the issuance of the show-cause notice. However, the Adjudicating Authority invoked the extended period of limitation under Section 73(4) of the Finance Act, 1994 and confirmed the demand along with penalties - Whether the invocation of the extended period of limitation and the consequent demand of service tax, interest and penalties were legally tenable – HELD - The show-cause notice did not contain any specific allegation of fraud, collusion, willful misstatement or suppression of facts with the intent to evade payment of service tax, which is a mandatory requirement for invoking the extended period of limitation under Section 73(4). Mere non-payment of taxes is not equivalent to collusion or willful misstatement, and something more needs to be shown to construe the acts as fit for the applicability of the proviso to Section 73(1) - Further, the appellant had paid the entire service tax demand along with interest before the issuance of the show-cause notice. The Revenue has not brought anything on record to evidence that the appellant's explanation was incorrect or deserved to be disbelieved. In such a scenario, the proceedings should have been concluded under Section 73(3) of the Finance Act, 1994, and the invocation of the extended period of limitation is untenable - The impugned order is set aside and the appeal is allowed [Read less]

Service Tax - Sale of space for advertisement on internet, Invocation of extended period of limitation for demanding service tax – Demand of service tax for the period 2015-16 and 2016-17, alleging suppression of facts and invoking the extended period of limitation under Section 73(1) of the Finance Act, 1994. The appellant contended that it was under the bonafide belief that its services were not taxable as they fell under the negative list under Section 66D(g) of the Finance Act, 1994 – HELD - The extended period of limitation could not have been invoked by the department, as the appellant had a bonafide belief that ... [Read more]

Service Tax - Sale of space for advertisement on internet, Invocation of extended period of limitation for demanding service tax – Demand of service tax for the period 2015-16 and 2016-17, alleging suppression of facts and invoking the extended period of limitation under Section 73(1) of the Finance Act, 1994. The appellant contended that it was under the bonafide belief that its services were not taxable as they fell under the negative list under Section 66D(g) of the Finance Act, 1994 – HELD - The extended period of limitation could not have been invoked by the department, as the appellant had a bonafide belief that its services were not taxable. The extended period of limitation can be invoked only when there is a positive act of fraud, collusion, wilful misstatement, or suppression of facts with an intent to evade payment of tax. Mere non-payment of tax, without any element of intent or suppression, is not sufficient to attract the extended limitation period - The appellant had disclosed the nature of its activities to the department while seeking registration in 2016-17, and the Department failed to make further enquiries at that time. Therefore, the demand made by invoking the extended period of limitation is not justified – The impugned order is set aside and the appeal is allowed [Read less]

Service Tax - Limitation period for filing refund claim of service tax on export supply - Appellant discharged service tax under the reverse charge mechanism on the commission and filed refund claims for the service tax paid. Rejection of refund on the ground that the claims were filed beyond the six-month time limit prescribed in the relevant notification - Whether the rejection of the appellant's refund claims on the ground of being filed beyond the time limit specified in the notification is tenable, or the one-year time limit under Section 11B of the Central Excise Act, 1944 should prevail – HELD - The time limit pre... [Read more]

Service Tax - Limitation period for filing refund claim of service tax on export supply - Appellant discharged service tax under the reverse charge mechanism on the commission and filed refund claims for the service tax paid. Rejection of refund on the ground that the claims were filed beyond the six-month time limit prescribed in the relevant notification - Whether the rejection of the appellant's refund claims on the ground of being filed beyond the time limit specified in the notification is tenable, or the one-year time limit under Section 11B of the Central Excise Act, 1944 should prevail – HELD - The time limit prescribed under Section 11B of the Central Excise Act, 1944, which is one year from the 'relevant date' (the date of payment of service tax), would prevail over the time limit specified in the Notification No.41/2007-Cus dated 06.10.2007. The time limit prescribed in the parent statute (Section 11B) cannot be overridden by the subordinate legislation (the notification). The appellant had filed the refund claims within the one-year period from the date of payment of service tax, and therefore, the claims were within the limitation period - The authorities are directed to grant the refund to the appellant in accordance with law – The appeal is allowed - Non-declaration of commission amount in shipping bills - The refund claims of the appellant were also rejected on the ground that the appellant had not indicated the commission amount in all the shipping bills - Whether the non-declaration of the commission amount in the shipping bills is a mere procedural requirement or a substantive condition for the grant of refund – HELD - The non-mention of the commission amount in the shipping bills is a mere procedural condition, and the refund claims can be considered if there is documentary evidence regarding the amount of service tax paid on the actual amounts of commission disbursed. A distinction must be made between substantive conditions and mere procedural requirements, and the non-observance of the latter should not lead to the denial of the substantial benefit - The non-declaration of the commission amount in the shipping bills is only a technical breach and is condonable, as the appellant had satisfied the substantial conditions of the notification. [Read less]

GST – Gujarat AAR - Classification and applicable GST rate of Paddle Wheel Aerators used exclusively in aquaculture operations - The applicant contended that the Paddle Wheel Aerators should be classified under HSN 8436 "Other agricultural, horticultural, forestry, poultry-keeping or bee-keeping machinery" attracting 12% GST – HELD - The Paddle Wheel Aerators do not fall under HSN 8436 as the term "agriculture" should be interpreted in its popular sense, which does not include aquaculture or fish farming. The inclusion of "fishers" in the definition of "farmer" under the National Policy for Farmers, 2007 does not neces... [Read more]

GST – Gujarat AAR - Classification and applicable GST rate of Paddle Wheel Aerators used exclusively in aquaculture operations - The applicant contended that the Paddle Wheel Aerators should be classified under HSN 8436 "Other agricultural, horticultural, forestry, poultry-keeping or bee-keeping machinery" attracting 12% GST – HELD - The Paddle Wheel Aerators do not fall under HSN 8436 as the term "agriculture" should be interpreted in its popular sense, which does not include aquaculture or fish farming. The inclusion of "fishers" in the definition of "farmer" under the National Policy for Farmers, 2007 does not necessarily extend to the classification of agricultural machinery. Further, the Supreme Court's judgment in Maheshwari Fish Seed Farm case held that pisciculture is not agriculture - As there is no specific entry covering Paddle Wheel Aerators, they would fall under the residual entry of HSN 8479 "Machines and mechanical appliances having individual functions, not specified or included elsewhere in this Chapter" and attract 18% GST – Ordered accordingly [Read less]

GST – Gujarat AAR - Classification of Mouth Freshener Products – Applicant is a manufacturer of various types of mouth freshener products including mukhwas in a unique capsule form under the brand name "KAPSUL" – Applicable HSN classification and GST rate for the applicant's products - Paan Kapsul (Silver Coated), Paan Kapsul (Regular), Paan Kapsul (Rose), ChatPata Twins, Tangy Twins, Ginger Shots, Amla Shots, and GasGo Candy – HELD - The Paan Kapsul products (Silver Coated, Regular, and Rose) should be classified under HSN 2106 90 30 as "Betel nut product known as Supari", as they contain raw supari (betel nuts) a... [Read more]

GST – Gujarat AAR - Classification of Mouth Freshener Products – Applicant is a manufacturer of various types of mouth freshener products including mukhwas in a unique capsule form under the brand name "KAPSUL" – Applicable HSN classification and GST rate for the applicant's products - Paan Kapsul (Silver Coated), Paan Kapsul (Regular), Paan Kapsul (Rose), ChatPata Twins, Tangy Twins, Ginger Shots, Amla Shots, and GasGo Candy – HELD - The Paan Kapsul products (Silver Coated, Regular, and Rose) should be classified under HSN 2106 90 30 as "Betel nut product known as Supari", as they contain raw supari (betel nuts) as one of the ingredients, along with menthol, but do not contain lime, katha (catechu), and tobacco - The products ChatPata Twins, Tangy Twins, Ginger Shots, Amla Shots, and GasGo Candy, which are mainly composed of spices and ingredients like dry mango, pudina, dry ginger, cumin, orange powder, amla, salt, black pepper, red chili, etc., should be classified under HSN 2106 90 99 as "Food preparations not elsewhere specified or included" - As per Sl. No. 145 of Schedule-I of Notification No. 9/2025-CT(R) dated 17.09.2025, goods falling under HSN 2106 (other than 21069020-Pan Masala) will attract GST at the rate of 5%. Therefore, all the applicant's products, i.e., Paan Kapsul (Silver Coated), Paan Kapsul (Regular), Paan Kapsul (Rose), ChatPata Twins, Tangy Twins, Ginger Shots, Amla Shots, and GasGo Candy, will attract GST at the rate of 5% - Ordered accordingly [Read less]

GST – Gujarat AAR - Applicability of GST on Advance received - Sections 2(31), 12, 13 of CGST Act, 2017 - The applicant, a government contractor, received a contract from AUDA for providing services related to storm water drainage. As per the contract, 10% of the accepted contract amount is given as an advance/loan to the applicant, which is backed by an equivalent amount of security - Whether the advance payment would attract GST – HELD - The advance payment received by the applicant would be considered as a 'consideration' under Section 2(31) of the CGST Act, as it is a payment made in response to the supply of servi... [Read more]

GST – Gujarat AAR - Applicability of GST on Advance received - Sections 2(31), 12, 13 of CGST Act, 2017 - The applicant, a government contractor, received a contract from AUDA for providing services related to storm water drainage. As per the contract, 10% of the accepted contract amount is given as an advance/loan to the applicant, which is backed by an equivalent amount of security - Whether the advance payment would attract GST – HELD - The advance payment received by the applicant would be considered as a 'consideration' under Section 2(31) of the CGST Act, as it is a payment made in response to the supply of services. The time of supply of the advance payment would be the date of receipt of payment under Section 13 of the CGST Act, and the liability to pay GST would arise on that date. However, if an invoice is issued for the advance received within the prescribed period under Section 31 of the CGST Act, the liability to pay tax would be the date of issue of the invoice or the date of receipt of payment of the advance, whichever is earlier – Ordered accordingly [Read less]

GST – Gujarat AAR - Supply of goods or Restaurant services, Taxability of supply of ice cream by a composite food service establishment - The applicant proposes to establish and operate a multi-product food business with a focus on the preparation and sale of diverse range of freshly made food and beverage items, including ice cream, which will be either manufactured at the same premises or at a separate manufacturing unit and then supplied through the applicant's own retail outlets. The retail outlets will have the option of dine-in for customers - Whether the supply of ice cream, manufactured at the same premises or ma... [Read more]

GST – Gujarat AAR - Supply of goods or Restaurant services, Taxability of supply of ice cream by a composite food service establishment - The applicant proposes to establish and operate a multi-product food business with a focus on the preparation and sale of diverse range of freshly made food and beverage items, including ice cream, which will be either manufactured at the same premises or at a separate manufacturing unit and then supplied through the applicant's own retail outlets. The retail outlets will have the option of dine-in for customers - Whether the supply of ice cream, manufactured at the same premises or manufacturing unit and sold through its various outlets (over the counter/B2C), qualifies as 'restaurant services', taxable at 5% GST without eligibility of Input Tax Credit (ITC) - Further, whether the tax treatment would differ in cases where such ice cream is supplied in the course of business-to-business (B2B) transactions - HELD - The supply of ice cream manufactured outside the retail outlet and sold over the counter does not qualify as 'restaurant service' and would be considered as supply of goods. However, when the ice cream is supplied along with food or used in other food preparations like faludas, milk shakes, juices etc., it would qualify as a composite supply of restaurant services. Further, the ice cream prepared in the applicant's retail outlet and supplied to dine-in or retail customers would fall under the definition of restaurant services, even if they are taken away without consuming in the retail outlet. However, when such ice cream is supplied as part of B2B transactions, it shall be treated as a supply of goods – Ordered accordingly - If not covered under restaurant services, whether the supply of ice cream from such outlets is liable to be classified as supply of goods by an ice cream parlour, thereby attracting 5% GST with ITC as per Notification No. 9/2025-Central Tax (Rate) Dated 17th September, 2025? Further, what would be the applicable GST rate where a separate GST registration is obtained for the ice cream manufacturing unit and supplies are made both on a business-to-business (B2B) and business-to-consumer (B2C) basis - HELD - For the supplies which are not covered under restaurant services, it would be considered as a supply of goods attracting 5% GST as per Notification No. 9/2025-Central Tax (Rate) Dated 17th September, 2025. Further, where a separate GST registration is obtained for the ice cream manufacturing unit and supplies made both on a B2B and B2C basis, it would be considered as supply of goods and the applicable GST rate would be 5%. [Read less]

Customs - Classification of Polyvinyl Chloride (PVC) Suspension Resin – Appellant imported 'Polyvinyl Chloride (PVC) Suspension Resin SP 660' from Thailand, which was classified under CTH 39042110/39042190 as 'Other Poly (Vinyl Chloride); Non-Plasticised: Poly (Vinyl Chloride) Resins' and cleared at a concessional rate of Basic Customs Duty (BCD) at 2% under ASEAN-India Free Trade Area Preferential Trade Agreement. The Revenue, relying on a test report issued by Central Institute of Plastics Engineering & Technology (CIPET) in respect of another importer, proposed reclassification of the goods under CTH 39041090 and deni... [Read more]

Customs - Classification of Polyvinyl Chloride (PVC) Suspension Resin – Appellant imported 'Polyvinyl Chloride (PVC) Suspension Resin SP 660' from Thailand, which was classified under CTH 39042110/39042190 as 'Other Poly (Vinyl Chloride); Non-Plasticised: Poly (Vinyl Chloride) Resins' and cleared at a concessional rate of Basic Customs Duty (BCD) at 2% under ASEAN-India Free Trade Area Preferential Trade Agreement. The Revenue, relying on a test report issued by Central Institute of Plastics Engineering & Technology (CIPET) in respect of another importer, proposed reclassification of the goods under CTH 39041090 and denied the benefit of the concessional notification, thereby confirming the demand of duty - Whether the classification adopted by the importer under CTH 39042110/39042190 or the reclassification attempted by the Revenue under CTH 39041090 is correct – HELD - The impugned order violates the principles of natural justice as the CIPET test report was not provided to the importer for effective rebuttal. On merits, in the cases of Arun Industries and Surabhi Enterprises, it was held that the imported goods are correctly classifiable under sub-heading 3904.21 (Tariff Item 3902 21 10) as 'Poly (Vinyl Chloride) Resins', which is a specific entry, and cannot be classified under the general entry of CTH 39041090 covering 'Others'. The period in the present case is prior to the change made in the Finance Act, 2017, whereby 'Poly (Vinyl Chloride) resin' was shifted from the specific heading 3904 21 10 to the general heading 3904 10. Therefore, the impugned order is set aside and the appeal is allowed [Read less]

Service Tax – Demand on Sale of Goods - Appellant contended that the total turnover was not on account of any service provided, but was on account of supply of materials, as evident from the Profit and Loss account and invoice-wise sales details – HELD - The entire turnover was towards sale of goods and not provision of services. The Profit and Loss account clearly showed the sale of materials and the purchase of materials, indicating that it was a case of sale of goods and not provision of services. The invoice-wise sales details also corroborated the fact that the entire turnover was towards sale of goods. The mentio... [Read more]

Service Tax – Demand on Sale of Goods - Appellant contended that the total turnover was not on account of any service provided, but was on account of supply of materials, as evident from the Profit and Loss account and invoice-wise sales details – HELD - The entire turnover was towards sale of goods and not provision of services. The Profit and Loss account clearly showed the sale of materials and the purchase of materials, indicating that it was a case of sale of goods and not provision of services. The invoice-wise sales details also corroborated the fact that the entire turnover was towards sale of goods. The mentioning of the turnover under the heading 'Sales of Service' in the Income Tax Returns could have been due to a clerical error on the part of the appellant - The turnover was towards sale of goods and not provision of services, and therefore, the Service Tax demand on the same is not sustainable – Further, the demand is also set aside on the ground of limitation, as the extended period of limitation could not be invoked in the absence of any fraud or suppression on the part of the appellant – The appeal is allowed [Read less]

GST - Suspension Order - U.P. Civil Services (Classification, Control and Appeal) Rules, 1956 - The petitioner was working as a State Tax Officer and conducted physical verification of a firm's GST registration application which was accorded deemed approval. The petitioner submitted an adverse report against the firm, and subsequently the firm fraudulently claimed Input Tax Credit - The Commissioner placed the petitioner under suspension in contemplation of an inquiry – The petitioner sought to argue that the impugned suspension order cannot be sustained – HELD - Prima facie, the ITC was claimed fraudulently by the fir... [Read more]

GST - Suspension Order - U.P. Civil Services (Classification, Control and Appeal) Rules, 1956 - The petitioner was working as a State Tax Officer and conducted physical verification of a firm's GST registration application which was accorded deemed approval. The petitioner submitted an adverse report against the firm, and subsequently the firm fraudulently claimed Input Tax Credit - The Commissioner placed the petitioner under suspension in contemplation of an inquiry – The petitioner sought to argue that the impugned suspension order cannot be sustained – HELD - Prima facie, the ITC was claimed fraudulently by the firm after the petitioner had submitted the adverse report. Bearing in mind the overall fact situation, and the nature of the allegation, prima facie the suspension is not to be continued - The suspension order is set aside and the disciplinary proceedings are directed to be concluded within 3 months. The petitioner shall participate in the proceedings and the authority shall not grant unnecessary adjournments. The petitioner is also directed to be paid subsistence allowance from the date of the suspension order till the date of the Court order – The petition is disposed of [Read less]

Customs - Demand of Customs Duties Jointly or Severally - Import of confectionery items by M/s. Nakshatra International Food Co. (NIFCO) and other IEC holders. Customs duty was demanded jointly and severally from NIFCO, its proprietor and his brothers as well as the other IEC holders - Whether demand of duty from multiple parties is legally valid – HELD – The customs duty can only be demanded from the sole proprietor of the importing firm and not jointly or severally from other persons, as an importer is the person who has filed the bill of entry under section 46 of the Customs Act, 1962. Demanding duty jointly or seve... [Read more]

Customs - Demand of Customs Duties Jointly or Severally - Import of confectionery items by M/s. Nakshatra International Food Co. (NIFCO) and other IEC holders. Customs duty was demanded jointly and severally from NIFCO, its proprietor and his brothers as well as the other IEC holders - Whether demand of duty from multiple parties is legally valid – HELD – The customs duty can only be demanded from the sole proprietor of the importing firm and not jointly or severally from other persons, as an importer is the person who has filed the bill of entry under section 46 of the Customs Act, 1962. Demanding duty jointly or severally does not arise unless it can be shown that the goods have been imported jointly - The demand of duty from other IEC holders jointly or severally is not legally valid as there is no provision to make multiple persons liable for the same import transaction - The impugned order is set aside in its entirety, and the appeals filed by the assessee-importers and customs brokers are allowed. The Departmental appeals are dismissed - Re-determination of Transaction Value - The adjudicating authority rejected the declared transaction values under Rule 12 of the Customs Valuation Rules, 2007 (CVR) and re-determined the values under Rules 3, 4 and 9 of the CVR - Whether the re-determination of values is in accordance with the CVR – HELD - The adjudicating authority did not comply with the two-step verification process under Rule 12 and did not provide the reasons for rejecting the declared values to the importer. Further, the re-determination under Rule 9 is not valid as the department had disowned the NIDB data of contemporaneous imports, which is a pre-condition for applying Rule 9. The reliance on proforma invoices alone, without any corroborating evidence of contemporaneous imports, is not legally sustainable to re-determine the transaction values - Admissibility of Electronic Evidence - Department relied on electronic evidence in the form of printouts extracted from seized hard disks and emails - Whether the electronic evidence is admissible – HELD - The electronic evidence is not admissible as the Department failed to comply with the mandatory requirements under Section 138C of the Customs Act regarding certification of the electronic evidence. The Tribunal relied on various judicial precedents which have consistently held that non-compliance with the statutory safeguards renders the electronic evidence inadmissible - Admissibility of Statements recorded under Section 108 - Department relied on the statements of the importers recorded under Section 108 of the Customs Act to re-determine the transaction values – HELD - The statements recorded under Section 108 are not admissible as the department did not comply with the requirements of Section 138B of the Customs Act, which mandates examination of the deponent as a witness and providing opportunity of cross-examination. The Tribunal relied on its own precedent in the Geetham Steels case which laid down the detailed procedure to be followed for statements recorded under Section 108 to be considered admissible - Classification of Goods - Department proposed re-classification of certain items like Nata-de-coco fruit juice and Coppo White Coffee - Whether the re-classification is valid – HELD - The onus to prove the correct classification is on the department, and in the absence of any credible evidence like product literature, manufacturing process details etc., the Tribunal could not interfere with the declared customs classification by the importers - Legality of Corrigendum and Revenue Appeals - The adjudicating authority issued a Corrigendum to impose penalties on Customs Brokers, and the department filed appeals seeking redemption fine and penalties - Whether the Corrigendum and the Revenue appeals are legally valid – HELD - The Corrigendum is not legally sustainable as the adjudicating authority becomes functus officio (having no further official duty or legal authority) after passing the original order, and can only correct clerical or arithmetical errors. The proposals for redemption fine and penalties are not legally tenable in the absence of availability of goods for confiscation and any evidence of active involvement or mens rea on the part of the Customs Brokers. [Read less]

Central Excise - Area-based exemption, Recovery of sanctioned refund - Appellant was granted refund of duty paid on certain inputs under Notification No.56/2002-CE dated 14.11.2002. Subsequently, the Department issued a show cause notice seeking to recover the refund amount on the ground that the duty paid was not leviable - Whether the department is barred from issuing the show cause notice to recover the refund amount after the initial refund order had attained finality – HELD - Once a refund order has been passed and has not been challenged, the Department cannot subsequently issue a show cause notice under Section 11... [Read more]

Central Excise - Area-based exemption, Recovery of sanctioned refund - Appellant was granted refund of duty paid on certain inputs under Notification No.56/2002-CE dated 14.11.2002. Subsequently, the Department issued a show cause notice seeking to recover the refund amount on the ground that the duty paid was not leviable - Whether the department is barred from issuing the show cause notice to recover the refund amount after the initial refund order had attained finality – HELD - Once a refund order has been passed and has not been challenged, the Department cannot subsequently issue a show cause notice under Section 11A to recover the refund amount. The refund order had not been challenged by the Department, and hence it had attained finality. The SCN is not maintainable as the Department was barred from issuing the notice to recover the refund amount after the initial refund order had attained finality - The impugned order is set aside and the appeal is allowed [Read less]

Central Excise - Challenge to the validity of Notification No. 02/2010-CEC, dated 22-6-2010 applying Section 11A for recovery of Clean Environmental Cess - The Notification dated 22.06.2010 issued under Section 83(7) of the Finance Act, 2010 made Section 11A of the Central Excise Act, 1944 applicable for the recovery of Clean Environment Cess (CEC) - Petitioner argued that Section 83(7) only empowers the Central Government to notify provisions relating to the "levy" of excise duty, whereas "assessment and collection" are specifically governed by Section 83(6) and Section 84 through the rule-making power - Whether the expre... [Read more]

Central Excise - Challenge to the validity of Notification No. 02/2010-CEC, dated 22-6-2010 applying Section 11A for recovery of Clean Environmental Cess - The Notification dated 22.06.2010 issued under Section 83(7) of the Finance Act, 2010 made Section 11A of the Central Excise Act, 1944 applicable for the recovery of Clean Environment Cess (CEC) - Petitioner argued that Section 83(7) only empowers the Central Government to notify provisions relating to the "levy" of excise duty, whereas "assessment and collection" are specifically governed by Section 83(6) and Section 84 through the rule-making power - Whether the expression “levy” occurring in Section 83(7) of the Finance Act, 2010, is wide enough to encompass the processes of assessment and collection/recovery of Cess - HELD - The expression “levy” has a varying connotation depending upon the context in which it is used. While it may be distinct from "collection" when both terms are used together, when used in isolation, "levy" can encompass the entire taxing process including assessment and realization. The term "levy" includes taking necessary steps to collect and determine liability - The Section 83(7) utilizes the legislative device of "incorporation by reference," which allows the legislature to adopt an existing statutory scheme for convenience rather than reproducing it verbatim. The Central Government had the option to either frame exhaustive Rules for collection under Section 84 or borrow the established procedure of the Central Excise Act by notification under Section 83(7). Once it is established that "levy" includes assessment and collection, the choice of the notification route is a valid exercise of statutory power - The subordinate legislation should be read harmoniously with the parent statute and that the inclusion of recovery provisions under the term "levy" does not violate the statutory scheme of the Finance Act, 2010. By issuing the impugned notification under Section 83(7), the Central Government had validly extended the applicability of Section 11A of the Central Excise Act, 1944 to the assessment and recovery of Clean Environment Cess - The impugned notification is intra vires the powers conferred under the Act – The writ petition is dismissed [Read less]

Central Excise - Cenvat Credit eligibility based on supplementary invoices – Appellant availed Cenvat credit based on supplementary invoices issued by M/s. Mahanadi Coalfields Ltd. (MCL) - Department issued notice alleging that the supplementary invoices were raised by MCL after detection of suppression towards non-inclusion of Cess in the valuation, and hence the appellant was not eligible for the Cenvat credit under Rule 9(1)(b) of the Cenvat Credit Rules – HELD - The department did not bring any concrete evidence to show that the show cause notice was issued to MCL alleging suppression and demanding duty on account ... [Read more]

Central Excise - Cenvat Credit eligibility based on supplementary invoices – Appellant availed Cenvat credit based on supplementary invoices issued by M/s. Mahanadi Coalfields Ltd. (MCL) - Department issued notice alleging that the supplementary invoices were raised by MCL after detection of suppression towards non-inclusion of Cess in the valuation, and hence the appellant was not eligible for the Cenvat credit under Rule 9(1)(b) of the Cenvat Credit Rules – HELD - The department did not bring any concrete evidence to show that the show cause notice was issued to MCL alleging suppression and demanding duty on account of non-inclusion of royalty charges. The exclusion under Rule 9(1)(b) applies only when the supplementary invoices are raised in respect of "recoverable duty amount" on account of suppression by the vendor, which was not the case here. The issue of whether royalty is required to be included in the assessable value was under prolonged litigation before the Supreme Court, and hence it was a matter of interpretation rather than suppression - The appellant is entitled to avail the Cenvat credit on the supplementary invoices as there was no element of fraud or suppression on the part of the appellant. Further, the demand for the extended period was also set aside on the ground of time bar, as the department failed to show any suppression by the appellant - The appeal is allowed [Read less]

GST - Refund of excess tax payment - Sections 54 of the CGST Act, 2017 - Petitioner deposited tax twice due to mistake, once by utilizing credit ledger and later by cash ledger - Revenue rejected the refund claim on the ground that the application was filed beyond the period of limitation prescribed under Section 54 of the Act - Whether the application for refund is barred by limitation under Section 54 of the CGST Act – HELD - The Limitation period stipulated for making application under Section 54 of the CGST Act is not applicable to refund of tax paid under a mistake of law - When an amount is paid under a mistake of ... [Read more]

GST - Refund of excess tax payment - Sections 54 of the CGST Act, 2017 - Petitioner deposited tax twice due to mistake, once by utilizing credit ledger and later by cash ledger - Revenue rejected the refund claim on the ground that the application was filed beyond the period of limitation prescribed under Section 54 of the Act - Whether the application for refund is barred by limitation under Section 54 of the CGST Act – HELD - The Limitation period stipulated for making application under Section 54 of the CGST Act is not applicable to refund of tax paid under a mistake of law - When an amount is paid under a mistake of law, the period of limitation prescribed under the special statute (here, Section 54 of the GST Acts) would not apply, and the general principles under the Limitation Act would be applicable - The claim for refund is based on payment of tax under a mistake, which would be hit by the provisions of Article 265 of the Constitution of India prohibiting collection of tax without authority of law. The Revenue cannot retain taxes deposited twice in respect of the same transaction, particularly when it has acknowledged the fact of such double deposits being made by the petitioner - The order rejecting the refund application is quashed and the authorities are directed to consider the fresh refund application filed by the petitioner within a fortnight and decide the same within 7 days, failing which the refund amount shall carry interest at the rate of 6% per annum – The petition is allowed [Read less]

GST - Anticipatory Bail - Applicant apprehending arrest in connection with alleged offenses under Sections 69 and 132 of the CGST Act, 2017 - Whether the absence of an FIR bars the grant of anticipatory bail – HELD As per the settled position of law laid down by the Supreme Court, the absence of an FIR does not bar the grant of anticipatory bail, Regarding the nature and gravity of the offenses, the allegations primarily pertain to documentary and digital evidence related to the wrongful availment of Input Tax Credit. The maximum punishment prescribed under Section 132 of the CGST Act is only five years, which does not ... [Read more]

GST - Anticipatory Bail - Applicant apprehending arrest in connection with alleged offenses under Sections 69 and 132 of the CGST Act, 2017 - Whether the absence of an FIR bars the grant of anticipatory bail – HELD As per the settled position of law laid down by the Supreme Court, the absence of an FIR does not bar the grant of anticipatory bail, Regarding the nature and gravity of the offenses, the allegations primarily pertain to documentary and digital evidence related to the wrongful availment of Input Tax Credit. The maximum punishment prescribed under Section 132 of the CGST Act is only five years, which does not qualify as a heinous or violent crime warranting pre-trial incarceration. The limited statutory severity of punishment, coupled with the nature of the allegations, militated against the necessity of custodial detention at that stage - The relevant records and data have already been seized, and one co-accused has been granted regular bail, indicating that the applicant's continued liberty, subject to reasonable conditions, does not pose a risk of absconding or tampering with evidence. Considering the totality of the circumstances, including the nature of the accusation, the character of the evidence, the stage of investigation, the maximum punishment prescribed, and the fact that custodial interrogation has not been shown to be indispensable, the Court granted anticipatory bail to the applicant, subject to the imposition of certain conditions - The anticipatory bail application is allowed [Read less]

GST - Classification of Coconut Oil under GST - SCN proposing demands for short payment of GST under various grounds, including the classification of coconut oil under Tariff Heading 3305 instead of Tariff Heading 1513 – HELD - The Supreme Court in the case of Commissioner of Central Excise Salem vs. M/s. Madhan Agro Industries (India) Private Limited has settled the dispute regarding the classification of coconut oil. The Court held that pure coconut oil sold in small quantities as 'edible oil' would be classifiable under Heading 1513 in Section III-Chapter 15 of the Central Excise Tariff Act, 1985, unless the packaging... [Read more]

GST - Classification of Coconut Oil under GST - SCN proposing demands for short payment of GST under various grounds, including the classification of coconut oil under Tariff Heading 3305 instead of Tariff Heading 1513 – HELD - The Supreme Court in the case of Commissioner of Central Excise Salem vs. M/s. Madhan Agro Industries (India) Private Limited has settled the dispute regarding the classification of coconut oil. The Court held that pure coconut oil sold in small quantities as 'edible oil' would be classifiable under Heading 1513 in Section III-Chapter 15 of the Central Excise Tariff Act, 1985, unless the packaging thereof satisfies all the requirements set out in Chapter Note 3 in Section VI-Chapter 33, whereupon it would be classifiable as 'hair oil' under Heading 3305 - The matter back is remitted back to the Respondent to pass a fresh order on merits taking note of the Supreme Court's decision on the classification issue and to also consider the other issues raised in the show cause notice – The writ petition is disposed of [Read less]

GST - Right to be accompanied by legal counsel and video recording of proceedings - The Petitioner-company and its Director were issued summons under Section 70 of the CGST Act for inquiry into input tax credit availed on purchases from certain suppliers. The Petitioners sought permission for the Director to be accompanied by a legal counsel during the proceedings, and for the proceedings to be video recorded at the Petitioners' cost – HELD - Considering the nature of the inquiry, the Petitioner's willingness to cooperate, and the medical condition of the Director, the limited request of the Petitioners deserved to be ac... [Read more]

GST - Right to be accompanied by legal counsel and video recording of proceedings - The Petitioner-company and its Director were issued summons under Section 70 of the CGST Act for inquiry into input tax credit availed on purchases from certain suppliers. The Petitioners sought permission for the Director to be accompanied by a legal counsel during the proceedings, and for the proceedings to be video recorded at the Petitioners' cost – HELD - Considering the nature of the inquiry, the Petitioner's willingness to cooperate, and the medical condition of the Director, the limited request of the Petitioners deserved to be accepted. The statements of the Director be video recorded at the Petitioners' cost, and that the legal counsel be permitted to accompany the director but not to interfere or disrupt the proceedings. The advocate may sit at a visible distance but not at audible distance - The order was passed in the peculiar facts and circumstances of the case and should not be treated as a precedent – The petition is disposed of [Read less]

Customs - Penalty under Section 112(a)(i) of the Customs Act - The appellant, a customs broker licensed under the Customs House Agents Licensing Regulations, 2004, was alleged to have failed to perform its duty and exercise supervision to ensure proper conduct of its employees, leading to misdeclaration and illegal import of goods. The Commissioner imposed penalty on the appellant under Section 112(a)(i) of the Customs Act - Whether the penalty under Section 112(a)(i) of the Customs Act can be imposed on the appellant solely on the ground of violation of Regulation 19 of the 2004 Regulations, without any specific allegatio... [Read more]

Customs - Penalty under Section 112(a)(i) of the Customs Act - The appellant, a customs broker licensed under the Customs House Agents Licensing Regulations, 2004, was alleged to have failed to perform its duty and exercise supervision to ensure proper conduct of its employees, leading to misdeclaration and illegal import of goods. The Commissioner imposed penalty on the appellant under Section 112(a)(i) of the Customs Act - Whether the penalty under Section 112(a)(i) of the Customs Act can be imposed on the appellant solely on the ground of violation of Regulation 19 of the 2004 Regulations, without any specific allegation and evidence that the appellant was aware of the illegal acts of its employee/agent - HELD - The show cause notice merely alleged violation of Regulation 19 of the 2004 Regulations, and there was no specific allegation or evidence to show that the appellant was aware of the illegal acts of its employee/agent. Mere violation of the 2004 Regulations cannot be a ground to impose penalty under Section 112(a)(i) of the Customs Act, as there must be some tangible material to show that the appellant had knowledge of the illegal acts of its employee/agent - The impugned order imposing penalty under Section 112(a)(i) of the Customs Act on the appellant is set aside and the appeal is allowed [Read less]

GST - Demand for ineligible Input Tax Credit along with interest and penalty under the GST law - Whether the levy of interest and penalty by the impugned assessment order is valid – HELD - There is no scope for interference with the impugned assessment order as the petitioner had not opted for any of the alternatives provided under Sections 74(5), 74(8) or 74(11) of the CGST Act, 2017. The petitioner had admitted the tax liability and credited the same, and thus, the levy of interest under Section 50(3) and penalty under Section 74 of the is valid. The petitioner had the option to either pay the tax together with interes... [Read more]

GST - Demand for ineligible Input Tax Credit along with interest and penalty under the GST law - Whether the levy of interest and penalty by the impugned assessment order is valid – HELD - There is no scope for interference with the impugned assessment order as the petitioner had not opted for any of the alternatives provided under Sections 74(5), 74(8) or 74(11) of the CGST Act, 2017. The petitioner had admitted the tax liability and credited the same, and thus, the levy of interest under Section 50(3) and penalty under Section 74 of the is valid. The petitioner had the option to either pay the tax together with interest payable under Section 50 along with penalty equivalent to fifteen percent of such tax on the basis of its own ascertainment or the tax as ascertained by the proper officer in terms of Section 74(5) and inform the proper officer in writing of such payment. Similarly, the petitioner had the option to pay tax, interest under Section 50 together with 25% of such tax towards penalty within a period of 30 days from the date of issuance of the show-cause notice under Section 74(8). The petitioner also had the option under Section 74(11) to pay tax along with interest on belated payment along with penalty equivalent to 50% of such tax and communicate the same to the proper officer in writing of such payment. Since the petitioner did not opt for any of these alternatives, there is no scope for interfering with the impugned assessment order – The petition is dismissed [Read less]

GST - Violation of Principles of Natural Justice - Reliance on Undisclosed Evidence and Denial of Cross-examination – Demand for reversal of credit on the ground that the petitioner has not been able to demonstrate movement of goods - The Proper Officer, while passing the order, relied heavily on statements and declarations made by vehicle owners, but failed to provide these statements to the petitioner or allow an opportunity for cross-examination - Whether an adjudication order based on adverse third-party statements is sustainable when the taxpayer is denied access to such evidence and the right to cross-examine the w... [Read more]

GST - Violation of Principles of Natural Justice - Reliance on Undisclosed Evidence and Denial of Cross-examination – Demand for reversal of credit on the ground that the petitioner has not been able to demonstrate movement of goods - The Proper Officer, while passing the order, relied heavily on statements and declarations made by vehicle owners, but failed to provide these statements to the petitioner or allow an opportunity for cross-examination - Whether an adjudication order based on adverse third-party statements is sustainable when the taxpayer is denied access to such evidence and the right to cross-examine the witnesses - HELD - It is a settled principle of law that if any material or statement is relied upon by a quasi-judicial authority for drawing an adverse conclusion against a person, that person must be afforded a fair opportunity to rebut the same. By failing to provide the statements of the vehicle owners and denying the petitioner the right to cross-examine them, the Proper Officer committed a patent violation of the principles of natural justice, rendering the order vulnerable and prone to interference - The right to rebut adverse evidence is fundamental to fair adjudication. The impugned adjudication order is set aside, and the matter is remanded for fresh adjudication with specific directions to provide the witness statements and allow cross-examination if such evidence is to be relied upon – The petition is disposed of - Non-consideration of Evidence and Lack of Reasoned Order - Discharge of Burden regarding Movement of Goods - During the adjudication process, the Proper Officer doubted the movement of goods. The officer concluded that the movement was not proven due to the absence of specific documents like weighment slips or transportation payment reflections, without addressing the documents actually submitted - HELD - The petitioner had produced a "tome of documents" to establish the authenticity of the transactions. It was incumbent upon the Proper Officer to bestow reasoning as to why these documents were not reliable, acceptable, or sufficient. The order impugned does not show how the documents that have been furnished by the petitioner have been considered and why the said documents are not sufficient for the petitioner to discharge his burden as regards movement of goods - The failure to spend even a single line of reasoning on why the submitted evidence was rejected, coupled with translating "doubt" into a firm conclusion without analysis, makes the order infirm and perverse. The lack of reasons and non-consideration of relevant evidence necessitates judicial intervention - The order is quashed and the Proper Officer was directed to conduct a fresh hearing considering all documents on record. [Read less]

GST - Calculation of Statutory Interest on IGST Refund - Section 56 of the CGST Act, 2017 and Section 16 of the IGST Act, 2017 - Petitioner, following a prior High Court order directing the sanction of a refund with statutory interest, received interest payments that were subsequently reduced via a corrigendum or calculated at negligible amounts in separate orders without any clear justification or detailed methodology. The petitioner challenged these orders, contending that the interest calculations were in violation of the rates and mandates prescribed under Section 56 of the CGST Act and contrary to established judicial... [Read more]

GST - Calculation of Statutory Interest on IGST Refund - Section 56 of the CGST Act, 2017 and Section 16 of the IGST Act, 2017 - Petitioner, following a prior High Court order directing the sanction of a refund with statutory interest, received interest payments that were subsequently reduced via a corrigendum or calculated at negligible amounts in separate orders without any clear justification or detailed methodology. The petitioner challenged these orders, contending that the interest calculations were in violation of the rates and mandates prescribed under Section 56 of the CGST Act and contrary to established judicial precedents - Whether the respondents were justified in granting interest at reduced or arbitrary rates without providing a reasoned basis or adhering to the statutory requirements of Section 56 of the CGST Act - HELD - The impugned orders lacked any reasoning or discussion to explain how the interest amounts were determined or why previously sanctioned amounts were reduced. The Revenue is bound by the mandate of law and must calculate interest strictly in accordance with Section 56 as interpreted by the binding decisions of the Court in Altisource Business Solutions India Pvt. Ltd. and Lupin Ltd. - Once the Court has directed that the petitioner would be entitled for ‘statutory interest’, an appropriate exercise in that regard ought to have been undertaken and as acceptable in law and the petitioner was not required to approach this Court on any such issue. The authorities must follow the statutory mandate once the right to statutory interest has been judicially recognized. The petitioner should not have been forced into further litigation for an entitlement already settled by law - The impugned orders and corrigendum concerning interest are set aside and the respondents were directed to pass fresh orders determining the interest amounts strictly as per Section 56 of the CGST Act – The petition is disposed of [Read less]

The legislative intent is to limit the bar on ITC exclusively to "construction" of immovable property. The provision of Sec.17(5)(d) does not even remotely apply to activities of sub-plotting and transfer of leasehold rights absent any construction.

Andaman and Nicobar Islands Value Added Tax Regulation, 2017 - Maintainability of Writ Petition – Availability of Alternative Statutory Remedy – Petitioners challenged notices of assessment of tax, interest, and penalties issued under Andaman and Nicobar Islands VAT Regulation, 2017 - Respondents raised a preliminary objection regarding maintainability, citing the availability of an alternative remedy of appeal to the Appellate Tribunal - The petitioners argued that the Tribunal was not functional at the time of filing and that the notices were without jurisdiction due to being time-barred - Whether the High Court shou... [Read more]

Andaman and Nicobar Islands Value Added Tax Regulation, 2017 - Maintainability of Writ Petition – Availability of Alternative Statutory Remedy – Petitioners challenged notices of assessment of tax, interest, and penalties issued under Andaman and Nicobar Islands VAT Regulation, 2017 - Respondents raised a preliminary objection regarding maintainability, citing the availability of an alternative remedy of appeal to the Appellate Tribunal - The petitioners argued that the Tribunal was not functional at the time of filing and that the notices were without jurisdiction due to being time-barred - Whether the High Court should entertain writ petitions under Article 226 when a statutory appellate forum exists and has become functional during the pendency of the proceedings - HELD - The High Court’s jurisdiction under Article 226 is discretionary and governed by rules of self-imposed restraint, particularly in fiscal matters involving the recovery of public dues. While an alternative remedy is not an absolute bar, the Court should be slow to intervene when a specialized Tribunal is available. Although the Appellate Tribunal was not functional when some petitions were initially filed, it was designated and made operational via a notification dated August 19, 2025. Tax disputes, which often involve complex factual inquiries, are more effectively adjudicated by the statutory Tribunal - Furthermore, by filing objections under Section 74 and participating in hearings before the Commissioner, the petitioners elected a statutory path and waived their right to challenge the initial notices through a writ after receiving an unfavorable decision. The records of writ petitions filed before the Tribunal became functional are transferred to the Appellate Tribunal, while petitions filed thereafter are dismissed with liberty to pursue statutory appeals - the writ petitions are disposed of - Limitation as a Jurisdictional Bar – Mixed Question of Fact and Law – Determination of Tax Period – The petitioners contended that the assessment notices for financial years 2017-18, 2018-19, and 2019-20 were issued beyond the four-year limitation period prescribed under Section 34 of the 2017 Regulation, thereby rendering the proceedings void for want of jurisdiction - HELD - Limitation is generally a mixed question of fact and law. In this instance, the parties were in dispute as to whether returns had been duly filed and the exact dates of such filings, with the petitioners failing to provide copies of the returns to the Court. Since the foundational facts for determining the limitation period were not admitted, the issue did not emerge as a pure jurisdictional error. Such disputes requiring factual verification regarding the filing of returns and the applicability of grace periods are best suited for adjudication by the Appellate Tribunal rather than the writ court - The Court declined to decide the limitation issue on merits, relegating it to the Appellate Tribunal - Principles of Natural Justice – Post-Decisional Hearing – Compliance in Fiscal Statutes – The petitioners alleged that the assessment notices were vitiated by a breach of natural justice because they were issued without a prior audit or an opportunity for a pre-decisional hearing - Whether the absence of a pre-decisional hearing before the issuance of a tax demand notice violates the principles of natural justice when a subsequent statutory hearing is provided - HELD - The principles of natural justice are not rigid and do not always require a hearing at the pre-decisional stage, especially in taxing statutes. A post-decisional hearing that allows for a full review of the original order on merits satisfies the requirement of fairness. Section 74 of the 2017 Regulation provides for a personal hearing upon request when an assessee files an objection. As the petitioners had already availed themselves of this opportunity and participated in a reasoned hearing before the Joint Commissioner, no prejudice was demonstrated. The statutory scheme of issuing a notice followed by an objection and hearing process constitutes sufficient compliance with the rule of audi alteram partem - The challenge based on violation of natural justice is rejected, and the parties were relegated to the statutory appellate forum. [Read less]

Central Excise - Exemption from Excise Duty to ATF - Appellant cleared ATF to its registered warehouses without payment of excise duty under the procedure prescribed in Circular No. 804/1/2005-CX - Dept confirmed the demand of excise duty on such clearances, holding that the facility of removal of ATF without payment of duty under Rule 19 of the Central Excise Rules, 2017 was withdrawn by Notification No. 02/2022 and the exemption under Notification No. 08/2022 was not applicable as the ATF was not directly supplied from the refinery to the foreign going aircraft - Whether the appellant was entitled to exemption from payme... [Read more]

Central Excise - Exemption from Excise Duty to ATF - Appellant cleared ATF to its registered warehouses without payment of excise duty under the procedure prescribed in Circular No. 804/1/2005-CX - Dept confirmed the demand of excise duty on such clearances, holding that the facility of removal of ATF without payment of duty under Rule 19 of the Central Excise Rules, 2017 was withdrawn by Notification No. 02/2022 and the exemption under Notification No. 08/2022 was not applicable as the ATF was not directly supplied from the refinery to the foreign going aircraft - Whether the appellant was entitled to exemption from payment of excise duty on clearance of ATF from the refinery to the registered warehouses under Notification No. 08/2022 – HELD - The Notification No. 08/2022 does not stipulate that the supply of ATF should be directly from the place of manufacture to the foreign going aircraft. The word "supplied" should be interpreted in a practical and purposive manner to include all supplies that culminate in the foreign going aircraft being fueled with ATF. In the absence of words like "only" or "exclusively" in the Notification, the benefit cannot be denied merely because the ATF was cleared through registered warehouses and not directly from the refinery – Further, the show cause notice did not refer to the withdrawal of this facility by Notification No. 17/2004. Even if this facility was withdrawn, the appellant is held to be entitled to the exemption under Notification No. 08/2022 on clearance of ATF from the refinery to the registered warehouses for supply to foreign going aircraft. Therefore, the impugned order demanding excise duty, interest and penalty from the appellant is set aside – The appeal is allowed [Read less]

Service Tax - CENVAT Credit - Lack of nexus - Appellant, operating both as a manufacturer and a service provider, imported telecom hardware and software for its manufacturing division and availed credit for Central Excise purposes. However, it also reflected the same credit in its service tax returns - Department alleged double availment and a lack of nexus between the imported goods and the output services - Whether CENVAT credit can be availed for service tax obligations using documents already utilized for manufacturing credit when the goods have no functional connection to the service activity – HELD - The credit is ... [Read more]

Service Tax - CENVAT Credit - Lack of nexus - Appellant, operating both as a manufacturer and a service provider, imported telecom hardware and software for its manufacturing division and availed credit for Central Excise purposes. However, it also reflected the same credit in its service tax returns - Department alleged double availment and a lack of nexus between the imported goods and the output services - Whether CENVAT credit can be availed for service tax obligations using documents already utilized for manufacturing credit when the goods have no functional connection to the service activity – HELD - The credit is ineligible as the imported equipment and software were neither inputs nor capital goods for the service-related activities undertaken by the appellant. The goods were utilized in the manufacturing of products for a specific customer and had no nexus with the engineering or software services provided - Furthermore, the availment of credit on additional customs duty for service tax payment is found to be specifically barred under the Cenvat Credit Rules. Since the documents (Bills of Entry) were already utilized at the manufacturing unit, the second availment for service tax is deemed as double benefit and legally untenable – The demand of irregular credit is confirmed and the appeal is dismissed - Penalty and Extended Period - Suppression of facts and intentional re-availment of credit – HELD - Following a departmental investigation into irregular credit, the appellant's representative admitted the error and initially reversed the credit. However, it was later discovered that the appellant had suo moto re-availed the credit in subsequent returns without notifying the authorities, purportedly based on an internal legal opinion - The act of reversing the credit and then secretly re-availing it without departmental clarification was an intentional and deliberate act to evade payment of service tax. The statements recorded under Section 14 of the Central Excise Act, which were never retracted, clearly established the appellant’s awareness of the irregularity. The failure to inform the department of the re-availment constituted suppression of facts in utter disregard of legal provisions. Consequently, the imposition of an equal penalty and the invocation of the extended period of limitation are justified - Penalty and invocation of extended period upheld and appeal dismissed. [Read less]

Service Tax - Waiver of penalty – Non-payment of service Tax on the activity of installation of street lights, traffic lights, flood lights or other electrical and electronic equipment, appliances or devices or providing electronic connections. The appellant contended that the service recipient had informed them that such services do not qualify as taxable services but the appellant paid the Service Tax along with interest when pointed out during the audit - Whether the penalty imposed on the appellant should be waived considering that there was no mala fide intention on their part in not paying the Service Tax initially... [Read more]

Service Tax - Waiver of penalty – Non-payment of service Tax on the activity of installation of street lights, traffic lights, flood lights or other electrical and electronic equipment, appliances or devices or providing electronic connections. The appellant contended that the service recipient had informed them that such services do not qualify as taxable services but the appellant paid the Service Tax along with interest when pointed out during the audit - Whether the penalty imposed on the appellant should be waived considering that there was no mala fide intention on their part in not paying the Service Tax initially – HELD - In the given facts, no mala fide intent can be attributed to the appellant in not paying the Service Tax in time. The appellant had relied on the intimation from the service recipient that the said services were not taxable, as per the CBEC circular. Further, when the issue was pointed out during the audit, the appellant promptly paid the applicable Service Tax along with interest. In view of this, the various penalties imposed on the appellant under the Finance Act, 1994 should be dropped - The penalties imposed on the appellant are dropped and the appeal is allowed [Read less]

GST - Bar on filing appeals below threshold monetary limit - The appellant-Dept challenged the High Court order setting aside the reassessment proceedings - During the pendency of the appeal, a Circular dated 26.06.2024 was issued fixing specific monetary limits for filing and pursuing appeals before the GST Appellate Tribunal, High Courts, and the Supreme Court - Whether the monetary limits prescribed by the Circular apply to pending appeals and whether the Revenue is barred from pursuing the matter further – HELD – As per the Circular dated 26.06.2024 issued by CBIC, there is a bar on pursuing appeals before the Supr... [Read more]

GST - Bar on filing appeals below threshold monetary limit - The appellant-Dept challenged the High Court order setting aside the reassessment proceedings - During the pendency of the appeal, a Circular dated 26.06.2024 was issued fixing specific monetary limits for filing and pursuing appeals before the GST Appellate Tribunal, High Courts, and the Supreme Court - Whether the monetary limits prescribed by the Circular apply to pending appeals and whether the Revenue is barred from pursuing the matter further – HELD – As per the Circular dated 26.06.2024 issued by CBIC, there is a bar on pursuing appeals before the Supreme Court where the tax effect is less than Rs. 2,00,00,000/-. The Circular is explicit and binding. The expression "should not be pursued" used in the context of the National Litigation Policy clearly encompasses pending appeals in addition to the filing of fresh appeals - Where the tax in dispute (including various components of GST and older tax regimes) falls below the mandated threshold, the threshold bar created by the Circular is attracted. Since the tax component in the present case was lower than the prescribed limit for the Supreme Court, the Revenue is prohibited from pursuing the appeals. This dismissal on procedural grounds does not constitute an opinion on the underlying questions of law, which remain open for adjudication in appropriate future cases – The Revenue appeals are dismissed - Statutory Interpretation – Repeal and Savings Clause vs. Administrative Litigation Policy - Section 174(2)(f) of the CGST Act, 2017 – Revenue argued that since the appeals were pursued under the old Sales Tax Act and were protected by the repealing and saving section of the new Act, the subsequently issued monetary limits would be inapplicable – Whether the savings clause in a repealing statute permits the Revenue to pursue pending litigation that falls below the monetary thresholds set by a later administrative circular – HELD - While the savings clause preserves the legal validity of proceedings initiated under the repealed Act, it does not override a clear and explicit administrative directive issued under Sections 120 and 168 of the CGST Act regarding litigation management. The Circular’s mandate is a policy decision aimed at curbing low-value litigation and is applicable to "pursuing" pending appeals. The Revenue's argument is flawed as the Circular itself indicates that for disputes pertaining to tax demands, the aggregate tax amount must be considered against the monetary limit regardless of the statute under which the dispute originated. The administrative policy effectively limits the State’s discretion to continue litigation in the higher judiciary when the financial stakes do not meet the prescribed minimum. [Read less]

Customs - Retrospective withdrawal of Transport and Marketing Assistance (TMA) Scheme for specified agricultural products - The Ministry of Commerce and Industry had introduced the Transport and Marketing Assistance (TMA) Scheme for specified agricultural products in 2019. The Scheme was included in the Foreign Trade Policy 2015-2020 under Section 5 of the Foreign Trade (Development and Regulation) Act, 1992 – Vide DGFT Notification dated 25.03.2022, the Scheme was withdrawn retrospectively, preventing the petitioners from filing claims for reimbursement under the Scheme - Whether the TMA Scheme can be withdrawn retrospe... [Read more]

Customs - Retrospective withdrawal of Transport and Marketing Assistance (TMA) Scheme for specified agricultural products - The Ministry of Commerce and Industry had introduced the Transport and Marketing Assistance (TMA) Scheme for specified agricultural products in 2019. The Scheme was included in the Foreign Trade Policy 2015-2020 under Section 5 of the Foreign Trade (Development and Regulation) Act, 1992 – Vide DGFT Notification dated 25.03.2022, the Scheme was withdrawn retrospectively, preventing the petitioners from filing claims for reimbursement under the Scheme - Whether the TMA Scheme can be withdrawn retrospectively, thereby taking away the accrued rights of the exporters under the scheme – HELD – In the judgments of Union of India v. Asian Food Industries, Viraj Impex v. Union of India, and DGFT v. Kanak Exports, it has been held that Section 5 of the Foreign Trade (Development and Regulation) Act, 1992 does not empower the Government to make amendments with retrospective effect, thereby taking away the rights which have already accrued in favor of the beneficiaries under the scheme - The TMA Scheme was statutory in nature, having been introduced under Section 5 of the Act. While the Government has the power to withdraw or amend the scheme, it cannot do so retrospectively, as it would take away the vested rights of the exporters who had availed the benefits of the scheme - The impugned notification dated 25.03.2022 which withdrew the TMA Scheme retrospectively is quashed. The respondents are directed to process the applications filed by the petitioners and pay the accrued benefits accordingly – The writ petitions are allowed [Read less]

Customs - Provisional release of seized goods - Appellant imported Distillate Marine Oil classifying it under CTH 2710 19 61 of the Customs Tariff Act - Department alleged that the goods contained diesel or High Flash High Speed Diesel (HFHSD) and were to be classified under CTH 2710 19 49. The goods were seized under Section 110 of the Customs Act based on test reports indicating the goods did not meet the parameters for Distillate Marine Fuel under IS 16731, particularly the cloud point - Whether the seizure of goods solely on the basis of deviation in the cloud point parameter, which is not a mandatory specification for... [Read more]

Customs - Provisional release of seized goods - Appellant imported Distillate Marine Oil classifying it under CTH 2710 19 61 of the Customs Tariff Act - Department alleged that the goods contained diesel or High Flash High Speed Diesel (HFHSD) and were to be classified under CTH 2710 19 49. The goods were seized under Section 110 of the Customs Act based on test reports indicating the goods did not meet the parameters for Distillate Marine Fuel under IS 16731, particularly the cloud point - Whether the seizure of goods solely on the basis of deviation in the cloud point parameter, which is not a mandatory specification for Distillate Marine Fuel, is justified - HELD - The seizure of goods solely on the basis of deviation in the cloud point parameter is not justified. The cloud point is relevant only for the specific end-use and climatic conditions, and does not determine the classification of the goods. The Hon'ble Gujarat High Court in Aparajita Energy and Noya Infrastructure cases had held that the cargo cannot be seized merely on the basis of cloud point parameter, as it depends on the end-use and climate - The conditions imposed by the Commissioner of Customs for provisional release, including furnishing bank guarantees and end-use undertakings, are not sustainable. The traders shall only be required to file an end-use certificate before the Customs authority, without any requirement of bank guarantees or onerous conditions. The appellant cannot be discriminated and should be granted provisional release on similar terms as other similarly placed importers - The conditions imposed by the Commissioner of Customs for provisional release are set aside. The appellant is directed to file an end-use certificate before the Customs authority for provisional release of the goods. The bank guarantees furnished by the appellant shall be discharged - The appeal is allowed [Read less]

GST – Maharashtra AAR - Classification of Supply as Composite Supply or Mixed Supply - Sections 2(30), 2(74), 2(90) of the CGST Act, 2017 - The applicant is engaged in supplying a bundle of consumables essential for the operation of HP Indigo digital printing presses including ElectroInk, Photo Imaging Plates, Binary Ink Developer, Printing Blankets, Imaging Oil, Blanket Web and other machine products and ancillaries - Whether the supply qualifies as a "composite supply" under Section 2(30) of the CGST Act, with ElectroInk as the principal supply – HELD - The goods supplied by the applicant in a bundled manner cannot b... [Read more]

GST – Maharashtra AAR - Classification of Supply as Composite Supply or Mixed Supply - Sections 2(30), 2(74), 2(90) of the CGST Act, 2017 - The applicant is engaged in supplying a bundle of consumables essential for the operation of HP Indigo digital printing presses including ElectroInk, Photo Imaging Plates, Binary Ink Developer, Printing Blankets, Imaging Oil, Blanket Web and other machine products and ancillaries - Whether the supply qualifies as a "composite supply" under Section 2(30) of the CGST Act, with ElectroInk as the principal supply – HELD - The goods supplied by the applicant in a bundled manner cannot be termed to be naturally bundled as envisaged under the definition of Composite Supply. It is only when there is an integrated nexus between the supply of two goods in such a manner that the supply of one good becomes a necessary concomitant for the supply of other goods. In such cases, the supply of such goods would be treated as being bundled in the ordinary course of business - In the instant case, the supply does not qualify as a "composite supply" as the four essential conditions under Section 2(30) are not satisfied. Firstly, while the supply involves two or more taxable goods, the supplies are not "naturally bundled". The bundling of the goods is artificial and specific to the applicant's business model, rather than being the industry norm. The customers have the option to procure the goods separately under the "A-la-Carte" model, which shows the supplies are not naturally bundled. Secondly, there is no single "principal supply" that can be identified, as all the components are equally essential and interdependent for the printing process. The fact that ElectroInk constitutes 41% of the consumption does not make it the principal supply, as the CBIC has clarified that value or volume is not the sole determinant - Merely because certain goods are packaged or sold in a bundle for which a common price is charged does not by itself make supply of such goods a composite supply - The supplies made by the applicant constitute a "mixed supply" under Section 2(74), as the various items can be supplied separately and are not dependent on each other. Consequently, the highest rate of tax applicable amongst the constituent supplies shall apply to the entire supply as per Section 8(b) of the CGST Act – Ordered accordingly - Determination of time and value of supply of ElectroInk with consumables under the indigo press Contract – HELD - The time of supply will be the date of issue of invoice or the date of receipt of payment, whichever is earlier. The value of the supply will be the transaction value as reflected in the tax invoice issued by the applicant in terms of Section 31(4) of the CGST Act. [Read less]

GST – Maharashtra AAR – Eligibility to Input Tax Credit on construction of the breakwater wall, Works contract services - Sections 16 & 17 of CGST Act, 2017 - The applicant, engaged in the regasification of LNG, constructed a breakwater wall adjacent to the jetty as an integral part of the LNG regasification plant - Whether the applicant is eligible to avail ITC on the goods and services used for the construction of the breakwater wall – HELD - The services provided by the contractor to the applicant is a works contract services under Section 2(119) of the CGST Act, involving supply of both goods and services for con... [Read more]

GST – Maharashtra AAR – Eligibility to Input Tax Credit on construction of the breakwater wall, Works contract services - Sections 16 & 17 of CGST Act, 2017 - The applicant, engaged in the regasification of LNG, constructed a breakwater wall adjacent to the jetty as an integral part of the LNG regasification plant - Whether the applicant is eligible to avail ITC on the goods and services used for the construction of the breakwater wall – HELD - The services provided by the contractor to the applicant is a works contract services under Section 2(119) of the CGST Act, involving supply of both goods and services for construction of a breakwater project - The breakwater wall is an immovable structure which can be broken down and dismantled and the individual components moved from one place to another, but the entire breakwater wall cannot be moved from one place to another and can be considered to be an immovable structure constructed on the sea bed. The breakwater wall is a permanent civil structure and not "plant and machinery" as defined under the Explanation to Section 17(6) of the CGST Act. The definition of "plant and machinery" excludes land, buildings or any other civil structures, and the breakwater wall falls under the category of a civil structure - Further, the breakwater wall is not used for making outward supply of goods or services, as required by the definition of "plant and machinery". Even under Section 17(5)(d), the ITC is blocked for goods or services received for construction of an immovable property (other than plant and machinery) on one's own account. The breakwater wall is an immovable property, and therefore, the ITC is not admissible to the applicant – The applicant is not eligible to avail ITC on the construction of the breakwater wall – Ordered accordingly [Read less]

GST – Rajasthan AAR - Maintainability of Advance Ruling Application by Service Recipient - Section 95(a) and Section 97(2) of the CGST Act, 2017 - The applicant, a State Educational Board, sought Advance ruling regarding applicability of GST on various services it received from third-party suppliers - Whether a recipient of services is legally entitled to seek an Advance Ruling – Taxability of services provided to the Board as services relating to the conduct of examination by an educational institution - HELD - The definition of "applicant" under Section 95(a) is intentionally broad, encompassing any person registered... [Read more]

GST – Rajasthan AAR - Maintainability of Advance Ruling Application by Service Recipient - Section 95(a) and Section 97(2) of the CGST Act, 2017 - The applicant, a State Educational Board, sought Advance ruling regarding applicability of GST on various services it received from third-party suppliers - Whether a recipient of services is legally entitled to seek an Advance Ruling – Taxability of services provided to the Board as services relating to the conduct of examination by an educational institution - HELD - The definition of "applicant" under Section 95(a) is intentionally broad, encompassing any person registered or desirous of obtaining registration under the Act. The scope of an applicant is not restricted to suppliers, a person liable to pay tax under reverse charge or any recipient of service may seek an Advance Ruling on matters specified under Section 97(2) of the Act. Accordingly, the application is maintainable - The applicant-Board engaged suppliers for various services including the printing of answer sheets, question papers, and certificates, online examination form filling, annual maintenance of computers used exclusively for exams, result processing through marks allotment, and provision of computer operators. By virtue of Explanation (iv) to paragraph 3 of Notification No. 12/2017-CT(Rate) (as inserted by Notification No. 14/2018), Central and State Educational Boards are treated as "educational institutions" for the limited purpose of providing services by way of conduct of examination to students. Since the services enumerated by the applicant—including printing, IT support for forms and results, and operational assistance—are integral, directly connected, and exclusively utilized for the examination process, they fall squarely within the exemption provided under Entry 66(b)(iv) of the said notification. The exemption is not limited to the Board's output services but extends to specific input services received by the Board that are necessary for conducting examinations - All the services mentioned in the application are found to be in relation to the conduct of examination and hence are covered under the exemption available vide Entry No. 66(b)(iv) of Notification No. 12/2017-CT (Rate) – Ordered accordingly [Read less]

GST - Liability for GST Registration in Works Contract Services - Section 22(1) and Section 2(71) of the CGST Act, 2017- Applicant, a company registered in Uttar Pradesh, was awarded a turnkey contract for the construction of a power substation for NTPC at Bikaner, Rajasthan - Whether the applicant is legally required to obtain a separate GST registration in the State of Rajasthan solely because the site of the works contract (immovable property) is located there - HELD – In terms of Section 22(1), a supplier is liable to be registered in the State from where they make a taxable supply. The Section 2(71) defines the "loc... [Read more]

GST - Liability for GST Registration in Works Contract Services - Section 22(1) and Section 2(71) of the CGST Act, 2017- Applicant, a company registered in Uttar Pradesh, was awarded a turnkey contract for the construction of a power substation for NTPC at Bikaner, Rajasthan - Whether the applicant is legally required to obtain a separate GST registration in the State of Rajasthan solely because the site of the works contract (immovable property) is located there - HELD – In terms of Section 22(1), a supplier is liable to be registered in the State from where they make a taxable supply. The Section 2(71) defines the "location of the supplier of services" as the place of business for which registration has been obtained - The applicant has neither established any office nor any fixed establishment in the State of Rajasthan. Since the applicant manages the project from its Uttar Pradesh office and has not established a "fixed establishment" in Rajasthan, the location of the supplier remains Uttar Pradesh and the mere location of the "place of supply" at the construction site does not necessitate a local registration - The applicant is not required to obtain a separate GST registration in the State of Rajasthan – Ordered accordingly - Tax Treatment of Inward Supplies and Determination of Nature of Supply - Section 10(1) of the IGST Act, 2017 - During the execution of a substation project in Bikaner, Rajasthan, the applicant procured equipment and materials from various vendors, with some suppliers located in Uttar Pradesh and others within Rajasthan, for delivery directly to the project site on an "FOR site" basis - Appropriate tax treatment (IGST versus CGST/SGST) for these inward supplies based on the geographic origin of the vendors and the delivery destination - HELD - The taxability of inward supplies is determined by the location of the supplier and the place of supply; if the supply involves movement of goods from a vendor in Uttar Pradesh to the site in Rajasthan, it is an interstate supply liable to IGST, but if both the vendor and the delivery site are located within the State of Rajasthan, the transaction constitutes an intrastate supply attracting CGST and SGST. [Read less]