2019-TIOL-NEWS-254 Part 2, Dated: Tuesday, October 29, 2019

2019-TIOL-NEWS-254 Part 2 | Tuesday October 29, 2019

Dear Member,

Sending following links.

Warm Regards,
TIOL Content Team

TIOL PRIVATE LIMITED.

For assistance please call us at + 91 850 600 0282 or email us at helpdesk@tiol.in.

TIOL TUBE VIDEO

Sabka Vishwas - (Legacy Dispute Resolution) Scheme, 2019 | Episode 2 | Simply inTAXicating

DIRECT TAX


	2019-TIOL-2461-HC-MAD-IT Tamil Nadu State Transport Corporation Villupuram Ltd Vs ACIT Whether writ petition assailing re-assessment proceedings is sustainable if the assessee does not follow proper procedure of filing returns in reply to notice u/s 148 - NO: HC Whether in cases of re-assessment, the AO is obliged to pass a speaking order disposing off all objections raised against such proceedings - YES: HC - Assessee's writ petitions dismissed: MADRAS HIGH COURT 2019-TIOL-2460-HC-DEL-IT PR CIT Vs Nokia Solutions And Networks India Pvt Ltd Whether it is settled law that the Tribunal is empowered to extend stay on operation of an order, beyond the period of 365 days - YES: HC Whether when granting stay on recovery of duty, the Tribunal is also obliged to dispose off pending appeals on a priority basis after arranging the cases based on seniority and tax amount involved - YES: HC - Revenue's appeal disposed of: DELHI HIGH COURT 2019-TIOL-2157-ITAT-MAD Atul Arun Kesabekar Vs ACIT Whether income received from the sale of paintings can be treated as business income, if assessee shows that the paintings concerned are inherited by way of gift or purchase and are indicated as personal effects within the meaning of Section 2(14) - NO: ITAT - Assessee's appeals partly allowed: CHENNAI ITAT 2019-TIOL-2156-ITAT-CHD Charanjit Singh Vs ADDL CIT Whether deduction claimed towards cost of improvement deserves to be disallowed if the assessee fails to discharge its onus to prove genuineness of such claim - YES: ITAT - Assessee's appeal dismissed: CHANDIGARH ITAT 2019-TIOL-2155-ITAT-AHM Bharatkumar N Parikh Vs DCIT Whether penalty u/s 271AAB imposed on account of undisclosed income is unsustainable if no incriminating material exists to substantiate allegations of non-disclosure of such income - YES: ITAT - Assessee's appeals allowed: AHMEDABAD ITAT 2019-TIOL-2154-ITAT-MAD DXN Herbal Manufacturing India Pvt Ltd Vs DCIT Whether reimbursement of Excise duty received by the assessee is a trading receipt and taxable u/s 41, pursuant to which no deduction is allowed on such amount - YES: ITAT - Assessee's appeal dismissed: CHENNAI ITAT 2019-TIOL-2153-ITAT-PANAJI Bhandary Industrial Metals Pvt Ltd Vs ACIT Whether additions for unexplained credit are sustainable if relevant documents proving genuineness of transactions are submitted by the assessee - NO: ITAT - Assessee's appeal allowed: PANAJI ITAT

GST CASES


	AAR CASES 2019-TIOL-433-AAR-GST Santosh Distributors GST - Prices of the products supplied by the applicant is determined by the supplier/principal company and the applicant has no control over the same - therefore, it is evident that the additional discount given by the supplier through the applicant which is reimbursed to the applicant is a special reduced price - such additional discount is liable to be added to the consideration payable by the customer to the distributor/applicant to arrive at the the value of supply in terms of s.15 of the Act: AAR GST - Supplier of goods/principal company issuing the commercial credit note is not eligible to reduce its original tax liability and hence recipient/applicant will not be liable to reverse the ITC attributable to the commercial credit notes received by him from the supplier: AAR GST - Applicant is liable to pay GST at the applicable rate on the amount received as reimbursement of discount/rebate from the principal company: AAR - Application disposed of: AAR 2019-TIOL-432-AAR-GST Tata Projects Ltd GST - Supply under the contract for ‘Design, Realisation, Integration and Commissioning of 1.2 m Trisonic Wind Tunnel at Vikram Sarabhai Space Centre, ISRO, Thiruvananthapuram' cannot be considered as a supply of equipment eligible for concessional rate of tax as per Sl. no. 234B of 1/2017-ITR - such work of designing, realisation, integration and commissioning would fall under the definition of Works Contract u/s 2(119) of CGST Act; will attract GST @12% in terms of Sl. no. 3(vi) of 8/2017-ITR: AAR - Application disposed of: AAR 2019-TIOL-431-AAR-GST Vista Marine And Hydraulics GST - Supply of spare parts/accessories and repair service are distinct and separately identifiable supplies for which the rates are quoted differently and work orders are issued separately - such supply under the Repair Rate Contract cannot be considered as composite supply - Where a supply involves supply of, both goods and services and the value of such goods and services supplied are shown separately, the goods and services would be liable to tax at the rates as applicable to such goods and services separately: AAR - Application disposed of: AAR 2019-TIOL-430-AAR-GST Baby Memorial Hospital Ltd GST - Supply of medicines, drugs and other surgical goods from its pharmacy to in-patients are in the course of providing healthcare service which are naturally bundled and are provided in conjunction with each other would be considered as ‘composite supply' and eligible for exemption under ‘healthcare services', Sr. no. 74 of 12/2017-CTR: AAR GST - Supply of medicines, drugs and other surgical goods by the hospital from its pharmacy to out-patients is a taxable supply of goods and GST is applicable: AAR GST - Supply of artificial body parts/devices such as heart valve, artificial kidney, artificial joints and coronary stents which are implanted in the body essentially by means of a surgical procedure can be classified as a composite supply where the principal supply is of healthcare services and are exempted: AAR GST - Where artificial body parts/devices which are worn/attached/fitted/fastened to body for which a surgical procedure may or may not be required, the nature/taxability of supply has to be determined on a case to case basis: AAR GST - Supply of goods like wheel chairs, tricycles etc. to the patients cannot be considered as a composite supply where the principal supply is healthcare services - goods would be liable to GST on an individual basis: AAR - Application disposed of: AAR 2019-TIOL-429-AAR-GST CGR Gold Trading GST - Quality testing and certification of gold ornaments are covered under SAC 998346 and rate of GST is 18% as per Sl. no. 21(ii) of 11/2017: AAR GST - Jewellery Manufacturing Services SAC 998892 includes gold maintenance/repair works - Therefore, in case of gold maintenance/repair works such as enlargement of gold chains or other gold ornaments or cutting and polishing of gold ornaments or other repairs of gold ornaments, when undertaken by a job worker, the Rate of GST is 5% if undertaken on goods belonging to registered persons as per Sl. no. 26(i)(c) and 18% if job work is undertaken on goods belonging to unregistered persons as per Sl. no. 26(iv) of 11/2017-CTR: AAR GST - Printing name of emblems or embossing/projecting top or side portion of ornaments, cutting, shaping, sizing and conversion of gold ornaments into coins/biscuits as per instructions of prospective customers is also covered as Jewellery Manufacturing Services SAC 998892 and rate of tax would be in terms of 11/2017-CTR, Sr. no. 26(i)(c) or 26(iv) as the case may be: AAR GST - If the applicant is a pure job worker and if his total turnover is below Rs.19 lakhs per annum, registration is not required since as per s.22 of the Act, every supplier is required to take registration only when his aggregate turnover, computed on an India basis, in a FY exceeds the threshold limit of Rs.20 lakhs: AAR Application disposed of: AAR 2019-TIOL-428-AAR-GST Industrial Engineering Corporation GST - Applicant is a manufacturer or packing containers such as empty barrels and drums mainly used by manufacturers of paint industries, petrochemical industries etc. as packing material - applicant is planning to execute the supply order through another firm to ensure timely delivery to customers - they have sought ruling as to the rate of GST applicable to the job work charges payable by them; documents to be maintained; in case some consumables are arranged by the job work unit, whether there would be a change in rate of tax; whether there would be any tax liability on the value of scrap held with job work unit. Held: Rate of GST applicable is 18% as per Sl. no. 26(iv) of 11/2017-CTR; that in terms of s.143 registered principal may, without payment of tax, send inputs or capital goods to job worker and on completion of job work bring back the goods or supply the same directly to customer, rate of GST being same as that mentioned above; rule 45, 55 of the CGST Rules, 2017 and Form GST ITC-04 to be filed; use of own goods by job worker will have no bearing on the rate of GST applicable; insofar as scrap and waste generated at job worker's end is concerned, as per s. 143(5) of the Act, same can be supplied by job worker directly from his place of business on payment of tax, if registered, or by the principal: AAR - Application disposed of: AAR HIGH COURT CASES 2019-TIOL-2471-HC-AHM-GST Sarveshwar Shyambihari Mittal Vs State Of Gujarat GST - During the relevant period, a vehicle and some goods contained therein were detained by the respondent authorities - On the same date, the Forms GST MOV-01 and GST MOV-02 came to be issued - Later, Form GST MOV-04 was issued and a notice for confiscation of the goods or vehicle and penalty u/s 130 of the CGST Act was issued - The quantum of the tax, penalty and fine was calculated - Thereafter, the vehicle as well as the goods were detained once again - Hence the present writ petition. Held - In view of such facts and circumstances, notice be issued to the parties, returnable as on 22.10.2019: HC - Notice issued: GUJARAT HIGH COURT 2019-TIOL-2470-HC-AHM-GST Vinayak Traders Vs State Of Gujarat GST - The petitioner's bank account had been attached by the respondent authorities - Hence the present writ. Held - Issue rule, returnable on Nov 28, 2019 - As interim relief, the respondent authorities are directed to lift the attachment over the petitioner's bank account: HC Notice issued: GUJARAT HIGH COURT 2019-TIOL-2469-HC-AHM-GST Ashok Singh Vs State Of Gujarat GST - A vehicle carrying some goods was detained by the respondent-authorities along with the goods contained - Thereafter an order of confiscation was passed u/s 130 - The present petition had been filed for release of the vehicle as well as the goods. Held - Considering that the petitioner already deposited the tax and penalty, then by way of interim relief, the respondent authorities are directed to release the conveyance in question along with the goods contained therein, subject to the final outcome of the present petition - The petitioner is directed to file an undertaking before the court to the effect that in the event of the petitioner being unsuccessful, the petitioner would pay the balance amount payable under the order of confiscation u/s 130 without prejudice to the right to challenge such an order: CESTAT - Writ petition disposed of: GUJARAT HIGH COURT 2019-TIOL-2468-HC-AHM-GST Kohitoor Transport Llp Vs State Of Gujarat GST - The present petition was filed seeking to release a vehicle carrying some goods, both of which were detained by the respondent-authorities. Held - Apparently, a physical verification report in Form GST-MOV 04 was prepared, wherein the description of the goods as per invoice including HSN code and description of goods in the conveyance is stated to be as per the list attrached - However, in the original record, there is no list attached to the same - The counsel for the respondent-State produced Annexure I to the Form GST MOV 10 wherein the market value of the goods was stated by the officer concerned - However, on perusal of the original file, there is nothing to show as to on what basis such market value was determined - Hence as interim relief, the second respondent is directed to release the vehicle and the goods contained therein - The petitioner is also directed to file an undertaking to the effect that should the petitioner ultimately be held liable to pay tax, penalty or fine, the petitioner shall pay the same subject to its right to challenge the same: HC - Writ petition disposed of: GUJARAT HIGH COURT

INDIRECT TAX

SERVICE TAX

2019-TIOL-3111-CESTAT-AHM

Aahir Construction Vs CCE

ST - The assessee has constructed the buildings of Institute of Kidney Disease and Research Centre as the sub-constructor of M/s Malani Constructor - The assessee filed the refund claim under section 102 in FA, 1994 - The SCN that refers to refund application filed by assessee has raised objection only with regard to aspect of unjust enrichment - Whereas, the Adjudicating Authority as well as Commissioner (A) had gone into the aspect of nature of services, whether the services fall under works contract service - Such an important issue cannot be dealt without making any allegations in SCN - Both the authorities have travelled beyond the scope of SCN which is legally not permissible for the authority to deal with at such stage of adjudication as well by Commissioner (A) - Therefore, the findings as regard the issue of works contract is quashed and set aside - Now the issue remains to be decided is that whether there is unjust enrichment or otherwise - The assessee has not passed the incidence of refund amount to any other person - Therefore, this issue on unjust enrichment attained finality in favour of the assessee - Moreover, on going through the records, it is found that the assessee have not paid Service Tax over and above the service charged by principal M/s Malani Construction, which is clearly appearing in ledgers of both the parties that amount of Service Tax was not paid by M/s Malani Construction to the assessee - It is also observed that assessee have issued credit note to M/s Malani Construction for an amount of Rs. 14 lakhs towards Service Tax which was initially charged in the bill - With the ample of evidences, there is absolutely no doubt that the assessee have not passed on the incidence of Service Tax paid by them to any other person - Therefore, not only on the basis of evidence but as per clear concluding finding given by Commissioner (A) in his order, the issue of unjust enrichment does not exist - Accordingly, assessee is clearly entitled for refund of Service Tax paid by them - As a result, the impugned order is set aside: CESTAT

- Appeal allowed: AHMEDABAD CESTAT

2019-TIOL-3110-CESTAT-ALL

Agarwal Company Vs CCE & ST

ST - The assessee was registered with Service Tax Department under category of construction services in respect of "Commercial or Industrial or Civil Structure" and was paying service tax accordingly - However, during period from October, 2007 to March, 2008 and April, 2008 to September, 2008 the assessee discharged its service tax liability by treating the said services as 'Works Contract Services' - The assessee is challenging only the imposition of penalty under Section 76 and 78 - As regards the penalty imposed under Section 78, the major part of the demand was deposited by assessee prior to the issuance of SCN - As such, penalty required to be imposed under Section 78 was only to the extent of the amount not deposited by them - The Original Adjudicating Authority had given an option to the assessee to deposit 25% of the penalty within a period of one month from the date of passing of the order - As such, deposit of 25% of the balance amount as deposited by assessee as penalty under Section 78 is appropriate - Otherwise also, there is no dispute about the fact that the services provided by assessee were 'Works Contract Service' and as such switch over to the said services for payment of service tax which was in the knowledge of the Revenue also cannot be held to be with any mala fide - The only lapse on the part of assessee was that they did not get their registration certificate amended - However, assessee has already deposited duty plus 25% penalty on balance duty which was deposited after the order, the balance amount of penalty imposed upon them under Section 78 is set aside - It is well settled law that both the penalties i.e. under Section 76 and 78 cannot be imposed simultaneously, thus the imposition of penalty under Section 76 of the Act is set aside: CESTAT

- Appeal partly alowed: ALLAHABAD CESTAT

2019-TIOL-3109-CESTAT-ALL

Bharat Sanchar Nigam Ltd Vs CCE & ST

ST - Whether the credit availed on the basis of Advice Transfer Debit (ATD) issued from the head office of assessee is admissible - The issue is no more res-integra and stands decided by the precedent decisions of Tribunal in assessee's own case - Reference can be made to the decision in BSNL 2008-TIOL-1989-CESTAT-MAD - Inasmuch as the issue stands decided by the said decision in same assessee's case, by following the same, the impugned order is set aside: CESTAT

- Appeal allowed: ALLAHABAD CESTAT

CENTRAL EXCISE

2019-TIOL-3108-CESTAT-ALL

Tirupati Cylinders Ltd Vs CCE

CX - The assessee is engaged in manufacture of Empty LPG Cylinders, VP Ring, Stay Plates and Foot Rings - Sometime the assessee received back old used Cylinders from their customers and repair the same by replacing certain parts which they are manufacturing themselves - Subsequently on the basis of certain investigations, Revenue entertained a view that the assessee should have paid excise duty on various parts which were being consumed by them captively in repair of the Cylinders - The only ground of Revenue is that instead of paying service tax they should have paid duty of excise - However, the excise duty payable by assessee was available as credit to them, thus again leading to a Revenue neutral situation - Inasmuch as the assessee has paid the service tax which is more or less equivalent to the excise duty required to be paid by them, no justification found for upholding the duty of excise and observe that the service tax paid by them is required to be adjusted towards the excise duty now confirmed against them - Apart from the merits of the case, the demand stands raised by invoking longer period of limitation - As observed in the case of Reliance Communication Ltd. - 2018-TIOL-1331-CESTAT-MUM the longer period would not be available inasmuch as the entire situation is Revenue neutral - The assessee was paying service tax and was filing ST-3 returns which were not being objected by the Revenue - No case of suppression or misstatement can be made out against the assessee so as to invoke the longer period of limitation - Accordingly, the demand is held as barred by limitation and consequently unsustainable: CESTAT

- Appeal allowed: ALLAHABAD CESTAT

2019-TIOL-3107-CESTAT-DEL

Shri Ahimsa Mines And Minerals Ltd Vs CCE & CGST

CX - The assessee requested for refund of the amount of pre-deposit made by them along with interest - There is no dispute that on 22.06.2017 the refund claim was sanctioned to assessee, but the assessee contested the claim of interest on 30.06.2017 with three reminders given to the Department on various occasions - After entertaining the claim of interest of assessee, they were advised to file an appeal against the order dated 22.06.2017 before the Commissioner (A) on 14.11.2017 and thereafter appeal was filed on 08.12.2017 which shows that the in that circumstances, appeal filed on 08.12.2017 is within time as the cause of action for filing the appeal arose on 14.11.2017 when the assessee was asked to file the appeal - The Commissioner (A) has not decided the issue on merits - Therefore, matter is remitted back to the Commissioner (A) to decide the issue on merits: CESTAT

- Matter remanded: DELHI CESTAT

CUSTOMS

2019-TIOL-3106-CESTAT-DEL

Century NF Casting Vs CC

Cus - Whether the Revenue can enhance the declared value of goods under import without rejecting the transaction value/declared price as provided in Section 14 of Customs Act - The assessee urges that the Commissioner (A) have erred in relying upon the order of adjudicating authority, which was in respect of earlier imports - The adjudicating authority in earlier order had held that the value of goods cannot be lower than the constituent materials, that there was reason to doubt the truth or accuracy of value declared by assessee - Similar issue of rejection of transaction value and enhancement without any basis, was considered by a coordinate Bench of this Tribunal in Sanjivani Non-Ferrous Trading Pvt. Ltd. - 2017-TIOL-3396-CESTAT-ALL, wherein this Tribunal held that it is only after recording of a findings that the price/transaction value is not the sole consideration, the transaction value can be rejected - The judgement of the Tribunal was carried in appeal by Revenue and the Supreme Court in Sanjivani Non-Ferrous Trading Pvt. Ltd. - 2018-TIOL-447-SC-CUS, held that the normal rule is that the assessable value has to be arrived at on the basis of price actually paid as provided in Section 14 of the Customs Act, 1962, and that the declared price can only be rejected with cogent reasons - The Supreme Court relied on its earlier order in Prabhu Dayal Prem Chand -2010-TIOL-43-SC- CUS - No cogent reasons have been given by Court below for rejection of transaction value - The declared transactions value can only be rejected with cogent reasons by undertaking the exercise as to on what basis the paid price was not the sole consideration, or the transactions value - The adjudicating authority was bound to accept the transaction value declared by importer, and erred in rejecting the declared price without recording any finding for rejecting the same, as required under Section 14 of Customs Act - Accordingly, the impugned orders are set aside: CESTAT

- Appeals allowed: DELHI CESTAT

HIGH LIGHTS (SISTER PORTAL)


	TII TP - Margin earned in controlled transaction cannot be considered for comparability purpose: ITAT TP - Functional dissimilarity and huge disparity in ownership over intangibles renders such concerns as uncomparable for purposes of benchmarking: ITAT TIOL CORPLAWS SEBI Act, 1992 - Order to disgorge wrongful gains from unfair trade practices is sustainable only when it makes liability individual & not joint: SAT SEBI Act, 1992 - NBFC' s not exempted from compliance relating to private placement of NCDs to show that offer was not made to public: SAT IBC, 2016 - NCLT, NCLAT not to go into questions of contractual interpretations while addressing insolvency applications: NCLAT

NEWS FLASH


	Free Bus Ride - Delhi Govt keen to extend facility to Senior Citizens Senior most Judge Justice Arvind Bobde appointed as New CJI Justice Sharad Arvind Bobde appointed next Chief Justice of India