2018-TIOL-NEWS-136 Part 2, Dated: Monday, June 11, 2018

2018-TIOL-NEWS-136 Part 2 | Monday June 11, 2018

Dear Member,

Sending following links.

Warm Regards,
TIOL Content Team

TIOL PRIVATE LIMITED.

For assistance please call us at +91-7838594749 or email us at helpdesk@tiol.in.

TIOL TUBE VIDEO



	GST Re-Tyred \| Simply inTAXicating

CASE STORIES


	ST - Refund matured only as result of Tribunal's order, therefore, there is no question of granting interest for period prior to date of order: CESTAT I-T - Revised return can be filed on account of reconciliation carried out after changing accounting software package: ITAT ST - Levy of tax on transaction which pertains to activities outside the country is not appropriate: CESTAT

DIRECT TAX


	2018-TIOL-215-SC-IT PR CIT Vs Bloom Dekor Ltd Having heard the parties, the Apex Court condoned the delay and dismissed the SLP. - Revenue's SLP dismissed: SUPREME COURT OF INDIA - 2018-TIOL-214-SC-IT PR CIT Vs Container Corporation Of India Ltd Having heard the parties, the Apex Court condoned the delay and dismissed the SLP. - Revenue's SLP dismissed: SUPREME COURT OF INDIA 2018-TIOL-213-SC-IT PR CIT Vs Nila Baurat Engineering Ltd On hearing the matter, the Apex Court condoned the delay and dismissed the SLP filed by the Revenue. - Revenue's SLP dismissed: SUPREME COURT OF INDIA 2018-TIOL-1095-HC-KOL-IT PR CIT Vs Aravali Polymers Pvt Ltd Whether an ITO losses his jurisdiction over an assessee whose case has been transferred u/s 127 & so any steps taken by the ITO after such transfer are invalid - YES: HC - Revenue's appeal dismissed: CALCUTTA HIGH COURT 2018-TIOL-1094-HC-DEL-IT CIT Vs Pawan Kumar Jain Whether entries made in books of account can be solely relied on to decide the nature of cash receipts - NO: HC - Case remanded: DELHI HIGH COURT 2018-TIOL-829-ITAT-MUM Rbbr Exports Sonawala Vs ACIT Whether when the assessee has paid commission to its foreign agents for the services rendered outside India and claimed the same as 'business expenditure', such payment is not hit by the provisions of Sec. 9 - YES: ITAT - Assessee's appeal partly allowed: MUMBAI ITAT 2018-TIOL-828-ITAT-DEL Roshan Lal Ashok Kumar Vs ITO Whether even in the absence of any evidence to show that the assessee's unaccounted money has been routed in the share capital, the Revenue can still make additions in the hands of the assessee - NO: ITAT Whether when the identity of the shareholders and genuineness of transactions has been established by the assessee, the Revenue is not permitted to make additions merely on the basis of suspicion - YES: ITAT - Assessee's appeal allowed: DELHI ITAT

INDIRECT TAX

SERVICE TAX

2018-TIOL-1787-CESTAT-DEL

MSTC Vs CCE

ST - The assessee is engaged as an agent for sale & disposal of scrap on behalf of Government departments - For such activity, the assessee received commission - During the period of dispute, the Revenue noticed that for the commission received, no tax was paid - Duty demand was raised with interest and penalty - Held - After examining the Selling Agency Agreement, vis-à-vis, the definition of "Business Auxiliary Service" (BAS) as well as the definition of commission agent as given in the Notification, in conclusion, the activity will be covered within the definition of BAS services and not under the definition of commission agent : CESTAT (Para 7, 8, 9, 10) - Appeal Dismissed: DELHI CESTAT

CENTRAL EXCISE

CIRCULAR

excircular1065

'Place of Removal' under Section 4 of the Central Excise Act, 1944, the CENVAT Credit Rules, 2004 and the CENVAT Credit Rules, 2017

CASE LAWS

2018-TIOL-1786-CESTAT-MUM

Parle Products Pvt Ltd Vs CCE

CX - The assessee manufactures biscuits, chocolates, namkeens & confectionary - An exemption is accorded to those biscuits and namkeens that are priced below the prescribed benchmark - The Department opined that the assessee availed credit on common input services - While the Cenvat credit wrongly availed was reversed before issuance of SCN, Also, the prescribed procedure was not followed entailing them with the obligation to pay 5% of the value of exempted goods - Duty demand was raised was recovery of such amount - Held - The disputed amount related to the credit availed in full on common input services - Such ineligible amount was reversed by the assessee - The amounts of credit which had been taken is far less than the amount which was reversed - There is also no intention to evase payment of duty - Therefore, the imposition of penalty & interest is deleted : CESTAT (Para 1, 6, 7) - Appeal Partly Allowed: MUMBAI CESTAT

2018-TIOL-1785-CESTAT-MUM

Prabhat Dyeing And Printing Works Vs CCE

CX - The assessee was engaged in manufacture of art silk fabric - The Department opined that for the disputed period there was illicit removal of goods - Duty demand was raised & penalty was imposed - On appeal, CBEC upheld the penalty & directed re-examination of the duty liability - With regard to penalty the Tribunal deleted the same and remanded the matter to the Original Authority - Due to non-appearance of the assessee the Appellate Authority affirmed such order - Held - The order merely reiterates what was held by earlier Authorities - Moreover, the order is not consistent with the directions issued at the time of remand - Hence, the order challenged is set aside: CESTAT (Para 1, 6, 7, 8, 9, 10) - Appeal Allowed: MUMBAI CESTAT

2018-TIOL-1784-CESTAT-CHD

CCE Vs Riat Sons

CX- The assessee is engaged in the manufacture of centreless, crankshaft & cylindrical grinding machines - The Department opined that the assessee wrongly availed SSI exemption under Notification No.8/2003-CE in respect of the products being manufactured under the brand name 'RIAT SONS', whereas the brand 'RIAT' belonged to another entity - Further, the Department opined that assessee exploited the trade name of Brand 'RIAT' in order to exploit the goodwill of the owner of the brand name & at the same time availing SSI exemption - Duty demand was raised along with interest & penalty - However, after adjudication the SCN was dropped by the Authorities - Held - Both the brand names were registered with the trade mark authority and recognized as not similar - The brand name registration certificate as well as the SCN mentions that the two brand names were distinct - Following the decision in the case of Bhamber Engineers it is held that the assessee is entitled to the benefit of SSI exemption: CESTAT (Para 1, 5, 6, 7, 8) - Revenue's Appeal Dismissed: CHANDIGARH CESTAT

CUSTOMS

2018-TIOL-1788-CESTAT-BANG

NP Thahir Vs CC

Cus - DRI, Calicut had seized fake Indian Currency Notes worth Rs. 14.99 Lakhs from Shri Mohammed A.T. and Shri N.P. Thafsal while they were travelling in a Wagon R Car near to Cheruvanoor Co-op Bank, Calicut - The assessee Shri N.P. Thahir was the owner of said vehicle and he had already permitted his brother Shri N.P. Thafsal to use the vehicle as and when required - An option for redeeming the vehicle on payment of fine was granted to importer - Brother of assessee who was driving the vehicle at the relevant time was exonerated by Criminal Court and there is a clear-cut finding of Court in favour of brother of assessee that he did not have any knowledge of contents of carton and by relying upon the decision of Court, Tribunal also vide Order dated 06.03.2015 dropped the penalty against the brother of assessee on the ground that he had no knowledge of the fact that the carton contained fake currency and that he had not at all involved himself in transportation of fake currency knowing that he was doing so - Further, as far as assessee is concerned, there is no fault of assessee at all in the present case and his brother has also been exonerated by the Court and the Tribunal and therefore, in view of this, imposition of redemption fine is not sustainable in law and therefore, same is set aside: CESTAT - Appeal allowed: BANGALORE CESTAT

MISC CASES

2018-TIOL-61-AAR-GST

Aqua Machineries Pvt Ltd

GST - the applicant company manufactures & supplies Power Driven Pumps designed for handling waste, raw, storm or sewer water - Such pumps do not have measuring devices - The applicant seeks to know if the description “Power driven pumps primarily designed for handling water, namely centrifugal pumps (horizontal and vertical), deep tube-well turbine pumps, submersible pumps, axial flow and mixed flow vertical pumps” is applicable to the pumps, considering that the Chapter Heading 8413 does not differentiate between the nature of pumps used for dispensing an exact type of water - Also seeks to know whether such pumps attract GST @ 12%.

Held - In common parlance, reference to ‘water’ is understood in the sense of clear or raw water and not in the sense of ‘sewage’ - In commercial parlance also, ‘pumps primarily designed for handling water’ & ‘other pumps or pumps designed for handling sewage’ are distinctly known - The decisions rendered in context of notifications under the earlier tax regime, are inapplicable here - Hence pumps for sewage or waste would not be covered by Sl. No. 192 of Schedule II of Notification No. 1/2017-CT(R) - The corresponding Notfns issued under the GGST Act 2017 and the IGST Act, 2017 are inapplicable too - Hence the pumps are not eligible for GST @ 12% (CGST 6% + SGST 6% or IGST 12%): AAR

2018-TIOL-60-AAR-GST

Docsun Power Pvt Ltd

GST - the applicant manufactures, assembles, repairs & installs ‘Earthing Products' for electrical & electronic equipments - These are used for earthing purpose in industries, common buildings & other places - The materials required to produce ‘Earthing Products' consists of Mild Steel (MS) and Stainless Steel (SS), in solid rods and pipes - It also manufactures Earthing Pipe, Earthing Rods, Lightning Arrester & Back Fill Compound - The applicant seeks to know the classification of all these items.

Held - ‘Lightning Arrester' is classifiable under Tariff Heading 8535 - ‘Earthing Pipe' is classifiable under Heading 8538 - ‘Solid Rod Earthing' is classifiable under Tariff Heading 7215 - ‘Back Fill Compound' is classifiable under Tariff Heading 3824 - Lastly, the service of installation of Earthing System is classifiable under Service Accounting Code 9954: AAR

2018-TIOL-59-AAR-GST

Dyna Automation Pvt Ltd

GST - the matter at hand pertains to the classification of the product Steering Unit (Hydraulic Orbital Valve) - Whether it falls under Chapter Heading 8481 or 8431 or 8708 of the Customs Tariff Act, 1975 - The applicant also seeks to know the applicable rate of GST.

Held - Since the articles of Tariff Heading 84.81 are specifically excluded from Section XVII, through Section Note 2(e) of the Customs Tariff Act, 1975, the product 'Steering Unit (Hydraulic Orbital Valve)' cannot be considered to be part of the vehicle - Hence it is classifiable under Tariff Heading 84.81 of the Customs Tariff Act, 1975 - Thereby, Goods and Services Tax rate applicable to Tariff Heading 84.81 is applicable to the said product: AAR

2018-TIOL-58-AAR-GST

Guru Cold Storage Pvt Ltd

GST - the applicant seeks to know whether the cereals, pulses, spices, copra, jaggery (Gur), groundnuts (with or without shell), groundnut seeds, turmeric dried and ginger dried (soonth), cashew, almond, kismis, jardalu, anjeer (fig), date, ambli foal, classify as 'Agriculture Produce' under Notification No. 11/2017-Central Tax (Rate) - Also whether the taxability of such goods changes if they are received for storage either in bulk packing or small or retail packing with or without name or brand name, which is not registered under the Trade Mark Act, 1999 where no further processing is done or such processing is done which does not alter its essential characteristics but makes its marketable for primary market.

Held - Pulses (de-husked or split), jaggery, processed dry fruits such as processed cashew nuts, raisin (kismis), apricot (jardalu), fig (anjeer), date, tamarind (ambali foal), shelled groundnuts & groundnut seeds, and copra are not agriculture produce - Besides 'Cereal' on which any processing is done as is not usually done by a cultivator or producer will fall outside the definition of agriculture produce - Moreover, processed spices including processed turmeric and processed ginger (soonth), are not agriculture produce - However, groundnuts with shell, turmeric and ginger on which no further processing is done or such processing is done as is usually done by a cultivator or producer which does not alter its essential characteristics but make it marketable for primary market, would fall within definition of agriculture produce - Lastly, whole pulse grains such as whole gram, rajma and 'cereal' on which no further processing is done or such processing is done as is usually done by a cultivator or producer which does not alter its essential characteristics but makes it marketable for primary market, fall under the definition of agriculture produce: AAR

2018-TIOL-57-AAR-GST

RB Construction Company

GST - the applicant seeks to know whether any work executed & invoice to be raised for the pending event of testing and commissioning after the implementation of GST amount to supply, and specifically supply of works contract - Also whether the applicant is entitled to avail proportionate credit worth 10% duty of excise and VAT paid on materials bought vide invoices showing Excise and VAT separately under the transition provisions.

Held - The activity of laying underground pipeline network falls under "works contract" u/s 2(119) under the CGST Act, 2017 and the GGST Act, 2017 - In respect of that part of supply wherein time of supply is on or after the appointed date, GST is required to be paid - Thereby, the applicant is ineligible for availing input tax credit u/s 140(6) of the CGST Act, 2017 and the GGST Act, 2017: AAR

2018-TIOL-56-AAR-GST

Shree Vishwakarma Engineering Works

GST - the applicant manufactures electrically operated drum with bell and zalar - It seeks to know its classification under the Customs Tariff Act & whether the same is eligible for exemption under Sl. No. 143 of Notification No. 2/2017-Central Tax (Rate).

Held - the products are classifiable under Heading 9208 of the First Schedule to the Customs Tariff Act, 1975 - They are also ineligible for exemption under Sl. No. 143 of Notification No. 2/2017-Central Tax (Rate) and corresponding notification in GGST Act: AAR

2018-TIOL-1093-HC-KAR-VAT

Bright Road Logistic Vs CTO

Whether vehicle & goods seized deserve to be released upon furnishing of bank guarentee and payment of taxes by the dealer who owns them - YES: HC - Case disposed of: KARNATAKA HIGH COURT

NEWS FLASH


	Delhi Assembly Speaker summons errant bureaucrats; HC admits plea NDA wrong policies have punctured tyres of economy: Chidambaram