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2018-TIOL-NEWS-023 | Saturday January 27, 2018
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Dear Member,
Sending following links. Warm Regards,
TIOL Content Team
TIOL PRIVATE LIMITED.
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DIRECT TAX |
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2018-TIOL-35-SC-IT
DCIT Vs Whirlpool Of India Ltd
Having heard the parties, the Supreme Court condones the delay and directed for stay on the operation of the impugned judgment. - Case listed for further hearing: SUPREME COURT OF INDIA
2018-TIOL-34-SC-IT
CIT Vs Sakal Relief Fund
Having heard the parties, the Supreme Court condoned the delay and issued notice to respective parties directing their appearences for further hearing on the issue of 'benefit of accumulation' in the event of 'non filing if Form 10'. - Notice issued: SUPREME COURT OF INDIA
2018-TIOL-33-SC-IT
DCIT Vs Mastech Technologies Pvt Ltd
Having heard the parties, the Supreme Court condoned the delay and issued notice to respective parties directing their appearence for further hearing on the issue of validity of reopening notice u/s 148. - - Notice issued: SUPREME COURT OF INDIA
2018-TIOL-155-HC-KERALA-IT + Story
Muthoot Finance Ltd Vs JCIT
Whether evacuation of land for installation of wind turbine generators amounts to act of improvement of land - NO: HC
Whether therefore, administrative charges paid for such an act is an allowable deduction as 'depreciation' - YES: HC
Whether if the capital borrowed to acquire an asset was not used to set up the business, the claim for benefit of expenditure is open for assessee - NO: HC - Assessee's appeal partly allowed: KERALA HIGH COURT
2018-TIOL-160-ITAT-MUM
ITO Vs Art Housing Pvt Ltd
Whether mere production of Xeroxed copies of documents , not authenticated by the authorized person, is sufficient for assessee to establish that the alleged bogus entries of share application money are genuine - NO: ITAT - Revenue's appeal Allowed: MUMBAI ITAT
2018-TIOL-159-ITAT-MUM
Print House India Pvt Ltd Vs DCIT
Whether no disallowance u/s 14A can be made if assessee does not earn any exempted income in relevant year - YES : ITAT
Whether when AO has not doubted the sales effected by the assessee, addition at the rate of 12.5% of alleged bogus purchase is justified , specially in absence of independent enquiry regarding genuineness of purchases by the AO - YES: ITAT - Assessee's appeal partly allowed: MUMBAI ITAT
2018-TIOL-158-ITAT-AHM
Pannalal Baijnath Jaiswal Vs ITO
Whether mere symbolic possession letter, with a prima facie motive to justify longer period of holding of the asset for lessening the tax burden, cannot be taken into account for determination of period of holding of property sold - YES: ITAT
Whether therefore, 'vacant' possession cannot be visualized for completion of construction and thus, period of holding of the property cannot be reckoned from the date of possession letter, for calculation of capital gains - YES: ITAT - Assessee's appeal dismissed: AHMEDABAD ITAT
2018-TIOL-157-ITAT-KOL
Sales Emporium ULG Vs ITO
Whether when payment for sales promotion expenses is made through banking channels after deduction of TDS, same can still be rejected in absence of correct address of the party given by the assessee - NO: ITAT
Whether expenses paid for supply of gift articles, not supported by any relevant documentary evidence such as bills, delivery challans, vouchers etc can not be allowed as deduction - YES : ITAT
Whether in the absence of relevant details, disallowance of installation and delivery charges to the extent of 25% is fair and reasonable considering the nature of the assessee's business which warranted incurring of expenditure on installation and delivery charges in the regular course - YES : ITAT - Assessee's appeal partly allowed: KOLKATA ITAT
2018-TIOL-156-ITAT-KOL
Sarlaben Bhansali Charities Trust Vs CIT
Whether when the basis for initiating revision u/s 263 has already been considered during assessment and there is no allegation of non application of mind by AO, then revisional jurisdiction is not warranted in such case - YES : ITAT - Assessee's appeal allowed: KOLKATA ITAT
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INDIRECT TAX |
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SERVICE TAX SECTION
2018-TIOL-338-CESTAT-DEL
Wisdom Guards (P) Ltd Vs CCE
ST - Assessee engaged in providing of security agency service - Based on certain information that assessee were not discharging service tax properly, enquiries were conducted by calling for records from assessee as well as from the banks - On completion of enquiry, proceedings were initiated against assessee by issue of SCN - Assessee did not pay service tax at least for two years during material time neither they filed any returns during this time - Admittedly, business continued and assessee earned income - They also collected service tax along with their charges - Their failure to deposit service tax especially when the same has been collected from the client, clearly brought out the deliberate intent of non-payment of service tax.
Assessee also contested the impugned order as being passed in violation of principles of natural justice - It is contended that relied upon documents were not made available to them - SCN only refers to statements given by General Manager and Director of assessee apart from bank statements of assessee - Certain calculation sheets were also referred to for quantification of service tax - All these details are available with assessee - The total Service Tax liability amounting to Rs.1,21,36,522/- has been categorically admitted by Director - As stated by assessee, the said amount was reported to have been fully deposited by assessee in pursuance of a direction for pre-deposit given by the Tribunal which was affirmed by Supreme Court also.
Assessee submitted that due opportunity to defend the case was not provided - It is on record that a personal hearing in case has been conducted - The claim of assessee now before Tribunal that they could not make further submission in absence of relied-upon documents is only afterthought and not supported by any material evidence - When specifically asked about the request made by assessee for any document or details from adjudicating authority, assessee could not submit any such document - Tribunal is not in agreement with contention of assessee regarding violation of principles of natural justice in deciding the case by original authority - On careful consideration of impugned order, no reason found to interfere with the same - As already recorded, non-payment of service tax, even after collection of the same from the client, non-filing of returns, when the assessee is in this business for long time, is not supporting the claim of assessee against imposition of penalty or demand for extended period - Tribunal is not convinced with statement of assessee in this regard as per the reasons elaborated in this order: CESTAT - Appeal dismissed: DELHI CESTAT
2018-TIOL-337-CESTAT-CHD
Srishti Constructions Vs CCE & ST
ST - Assessee is in appeal against impugned order confirming demand of service tax along with interest and various penalties imposed under FA, 1994 - The period involved is 10.09.2004 to 31.03.2009 - Demand is confirmed under category of construction of Residential Complex and Commercial or Industrial Construction services, by invoking extended period of limitation - Assessee entered into a composite contract for supply of raw material as well as providing construction services - The issue is; whether the construction services provided along with material, falls under the 'Works Contract' service or construction of 'Commercial or Industrial Construction Services' / 'Residential Complex services' - The said issue has been dealt by Apex Court in case of Larson & Toubro Limited 2015-TIOL-187-SC-ST - The proper classification of activity undertaken by assessee is more appropriately falls under 'Works Contract' service and the same has not been alleged against assessee in SCN issued to them - SCN has been issued by invoking extended period of limitation on the ground that, as assessee has sought information through RTI applications whether their activity is liable to be taxed or not and the same has been replied by different Commissionerates as well as service recipients that their activity is not liable to be taxed under Finance Act, 1994 - Therefore, in the light of decision in the case of Uniworth Textiles Limited 2013-TIOL-13-SC-CUS , the extended period of limitation is not invokable - O n merits, the appropriate classification of services in question is "Works Contract service" and SCN not allege to demand service tax under Works Contract, therefore, the demand of service tax is set-aside: CESTAT - Appeals allowed: CHANDIGARH CESTAT
CENTRAL EXCISE SECTION
2018-TIOL-339-CESTAT-DEL
Avm Brothers Vs CCE
CX - Based upon search by DGCEI, the asessee was issued with SCN on the ground that it had received only invoices, without accompanying goods i.e. plastic granules from M/s Signet Overseas Ltd (SOL) and associates and availed Cenvat credit based on such invoices - Receipt of inputs has been denied only on the ground of vehicles were not capable of transportation of goods - The receipt of inputs has not been disputed, nor has any other corroborative evidence been brought on record by Department to sustain the charges - Assessee had provided the correct number of vehicles and also some of the addresses of owners were also provided - In that case, same could have been verified - The cross examination of transporters were rejected - The records of assessee showed the receipt of inputs and their consumption, which has not been disputed by Department - Revenue has also failed to prove flow back of money for non-receipt of goods - In absence of any contrary evidence, Cenvat credit cannot be denied to assessee, as held by judicial forums in case of Neepaz Steels Ltd., EM ESS Electricals, Adhunik Ferro Alloys Ltd. and Parmatma Singh Jatinder Singh Alloys P. Ltd.
Another demand of Rs. 72,02,038/- has been made against assessee on the ground of clearances of raw material and finished goods to M/s AVM Brothers and others - No investigation has been undertaken at M/s AVM Brothers, who allegedly consigned the re-processed granules and received Plastic granules from assessee - In absence of any investigation from the person, who maintained the details at the factory of assessee, denial of request for cross examination of transporter and investigation from M/s AVM Brothers, alleged recipient of Plastic Granules and consignor of re-processed granules, demand cannot be sustained - No details of any consideration towards such transactions appearing anywhere - In case of Dhanvilas (Madras) Snuff Co. , the tribunal held that in absence of investigation of alleged consignee/ buyer of goods, demand is not sustainable - Similar views were expressed by Tribunal in case of Raipur Forging Pvt. Ltd 2016-TIOL-1121-CESTAT-DEL , Motabhai Iron & Steel Industries 2014-TIOL-1617-HC-AHM-CX , Ramadevi Steels Pvt. Ltd. 2016-TIOL-2755-CESTAT-DEL , Century Metal Recycling Pvt. Ltd. 2015-TIOL-2944-CESTAT-DEL and Continental Cement Company 2014-TIOL-1527-HC-ALL-CX - In view of such observation, demand against assessee is not sustainable - Since the main appeal of assessee is allowed, penalties imposed upon other assessees namely, Shri Rajneesh Agarwal, Shri Mukesh Sangla and M/s AVM Brothers set aside: CESTAT - Assessee's appeals allowed: DELHI CESTAT
2018-TIOL-336-CESTAT-AHM
Garden Silk Mills Ltd Vs CCE, C & ST
CX - The assessee-company availed Cenvat credit on Running Accounting (RA) bills issued by the service provider, for rendering construction services in the assessee's premises - The Revenue alleged that service tax mentioned in the bills had not been paid by the provider - Duty demand was raised with interest & penalty & personal penalty, under Rule 26 of CER, 2002 - The Commr.(A) dismissed the assessee's appeals - Held - This Tribunal remanded the matter to the Adjudicating Authority to reconsider issues raised by the service provider - Hence, issue of admissibility of Cenvat credit arises only after such issues are settled: CESTAT (Para 3,6) - Case Remanded: AHMEDABAD CESTAT
2018-TIOL-335-CESTAT-DEL
Hindustan Zinc Ltd Vs CCE
CX - Assessee engaged in manufacture of Zinc & lead concentrates - Cenvat credit on various items were disallowed by department after issuing the show cause notice - Regarding the services of Development of underground mines, Consultancy services and Dozor Hiring services, both parties agreed that this issue has came up before Tribunal in assessee's own case vide Final Order dated 14.8.2017 , where the matter was remanded to adjudicating authority for fresh decision after examining the nexus between the services and the final product of assessee - Said direction is still pending before adjudicating authority - When it is so, adjudicating authority is directed to decide all the matters on same issue together but by providing a reasonable opportunity to assessee - Regarding the services of (i) drilling service, (ii) portal work at Kayad mines and (iii) quality inspection service, issue pertaining to drilling services has already came up before the Tribunal in assessee's own case and vide 2017-TIOL-3914-CESTAT-DEL - By following said order, cenvat credit allowed on drilling services - However, regarding portal work at kayad mines and quality inspection services, matter is remanded to adjudicating authority, to examine the nexus between the services and the final product of assessee: CESTAT - Appeals partly allowed: DELHI CESTAT
CUSTOMS SECTION
NOTIFICATION
ctariff18_005
Amendment to Notification No.50/2017-Customs (Rate)
CASE LAWS
2018-TIOL-334-CESTAT-DEL CC Vs Shriya Textiles
Cus - Assessee exported Polyester Fabrics under DEPB scheme - The whole dispute in the present case relates to date of export of these goods - The assessee based on documents showing export on 21.09.2004 obtained DEPB Scrips from JDGFT having benefit of 10% - Revenue contended that the date of export is 24.09.2004 with relevant applicable benefit of 5.5 % only - On close examination of documents, Tribunal is convinced that contrary claims were made on the basic fact of date of shipment based on documents, which bear the signature of customs offices - Though Revenue made various assertions regarding manipulation and correctness of documents by assessee, the only ground agitated in the appeal filed by Revenue is that the Commissioner cannot arrive at a different finding when the very same authority passed an order in favour of Revenue in the first round of litigation - Said ground relied on by Revenue in this regard is legally not sustainable - When the assessee produced various documents bearing signature of customs officers dated 21.09.2004, it is necessary for department to enquire as to how such documents were presented and in case of questioning their bonafideness, to conduct further inquiry with reference to alleged forgery - Instead of making simple allegation, it is necessary to indicate that concerned officers, whose signature is figuring in these documents have not signed them at all - Such assertion with evidence is lacking - It would appear that documentation has not been probed by Revenue to its logical end to find out any possible collusion of officers, which resulted in different types of entries/stamps having different dates - Above all, if documents submitted by assessee were not bonafide, correct course of action is to get the DEPB scrip cancelled by competent licensing authority - No such action has been taken by the Revenue as per the record: CESTAT - Appeal dismissed: DELHI CESTAT
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TIOL PRIVATE LIMITED.
TIOL HOUSE, 490, Udyog Vihar, Phase - V,
Gurgaon, Haryana - 122001, INDIA
Board : +91 124-2879600
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Web: http: //www.taxindiaonline.com
Email: updates@tiol.in
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