2020-TIOL-943-HC-DEL-IT

Sanjay Sawhney Vs Pr.CIT

Whether it is open to an assessee to invoke provisions of Rule 27 of the ITAT Rules so as to assail those grounds which were decided against itself, if such grounds have a bearing on the final decision under challenge - YES: HC

- Case remanded : DELHI HIGH COURT

2020-TIOL-616-ITAT-DEL

Sanjay Jain Vs ITO

Whether taxing cash deposits without giving corresponding credits to the withdrawals will be justified especially where the assessee was a small trader - NO : ITAT

- Assessee's appeal partly allowed: DELHI ITAT

ACIT Vs Kundan Rice Mills Ltd

Whether penalty u/s 271AAA is to be levied where the assessee offers additional income for taxation and also reflects such income in profit and loss account - NO: ITAT

- Revenue's appeal dismissed: DELHI ITAT

Gag Construction Pvt Ltd Vs ACIT

Whether provisions of Section 40A(3) would be applicable where land is purchased on behalf of and transferred to sister unit & where entire transaction is shown in assessee's balance sheet - NO: ITAT

- Assessee's appeal partly allowed: DELHI ITAT

S F Dyes Pvt Ltd Vs ACIT

Whether a company can claim depreciation in respect of a vehicle owned by its director, but where such vehicle was used for business purposes and the income derived therefrom was reflected as income of the company - YES: ITAT

- Assessee’s appeal allowed: MUMBAI ITAT

Pampamaheshwar Ravindranath Vs ACIT

Whether compensation paid for breach of contract can be treated as penalty for infraction of law - NO: ITAT

Whether therefore the same is payment allowable expense u/s 37(1) - YES: ITAT

- Assessee's appeal allowed: BANGALORE ITAT

Star Ply Board Ltd Vs Pr.CIT

Whether if there was case of AY 2014-15 and whereas the amended provisions of section 115BBE(2) are applicable from 1.4.2017, will the assessee as per the Board Circular was entitled for set off of loss against surrendered income – YES : ITAT

Whether according to section 115BBE the AO should calculate tax at 30% of the declared income – YES : ITAT

- Assessee's appeal allowed: CHANDIGARH ITAT

Nurserymen Cooperative Society Ltd

GST - Applicant is an association of persons and is in the business of maintaining gardens and landscape development for State and Central governments, local bodies and government undertakings - they are also providing pure services to these service recipients and the same is exempted by way of sr. no. 3 of 12/2017-CTR - applicant states that he is sub-contracting this work to the sub-contractors and sought to know from the Authority for Advance Ruling as to whether such sub-contact work is liable to tax under the Act - AAR held that e ven assuming that the activity of the applicant, is either covered in entry no. 3 or 3A of 12/2017-CTR, the activity supplied by the sub-contractor to the applicant would not be exempt as it is not covered either in Entry no. 3 or 3A of 12/2017-CTR since the applicant does not belong to the class of recipients enumerated therein - aggrieved, appellant is before the Appellate authority.

Held: Issue being examined is whether the services supplied by the sub-contractors to the appellant, who is the recipient of the services, is exempted from GST - Entries under Sl. no. 3 and 3A will apply only if the recipient of services is a government (Central/State/UT) or local authority or a Governmental authority or a government entity - in this case, the appellant who is the recipient of the supply from the sub-contractor is a co-operative society and not an entity specified in Sl. no. 3 and 3A - When the criterion of the notification is not satisfied, the sub-contractors as suppliers of service, will not be eligible for the aforementioned exemption - While the Authority agrees that the appellant will not be eligible for the Input Tax credit of the tax paid on the inward supply from the sub-contractors as the output supply made by the appellant to the Government department is exempted, the same cannot be a ground for allowing the sub-contractors to avail the benefit of exemption - It is a well settled law that exemption notifications are to be interpreted strictly as to their eligibility - One cannot be influenced by extraneous factors while determining a person's eligibility to an exemption notification - Therefore, on a strict interpretation of the Entry Sl. no. 3 and 3A, Authority holds that the supply of services by the sub-contractors to the appellant is not eligible for the benefit of exemption under either Sl. no. 3/3A of 12/2017-CTR - Order of Authority for Advance Ruling is upheld and appeal is dismissed: AAAR 

- Appeal dismissed: AAAR

2020-TIOL-29-AAAR-GST

Acharya Shree Mahashraman Chaturmas Pravas Vyavastha Samiti Trust

GST - In the matter of an application filed by the Appellant, a Trust, the AAR had held that the applicant is liable to pay tax on renting of temporary residential rooms of all categories to devotees if the declared tariff of a unit of accommodation is Rs.1000 or more per day or equivalent; that they are also liable to pay tax on renting of space for stalls; on supply of food and beverages at subsidised rates to devotees; on providing space for registered person without consideration for supply of food and beverages to devotees only if the applicant and such registered person are 'related persons'; is liable to tax for acting as an intermediary for booking of hotel rooms to the pilgrims from outside if he does not satisfy all the conditions for being considered as a 'pure agent' - Aggrieved by the ruling insofar as the renting of 2BHK and dormitory is concerned since under these two categories the charges are per room for a 2BHK and per bed for the dormitory and in both the cases, the charges are less than Rs.1000 per room/bed per day, the appellant is before the AAAR.

Held: Delay in filing appeal is condoned by the Authority in exercise of the powers vested in terms of the proviso to s.100(2) of the CGST Act - Authority finds that in the context of the appeal filed, the appellant is not renting out 'rooms' but rather is renting out units of accommodation comprising of 2 bedrooms, hall, kitchen, restroom, toilet etc. and the entire unit with facilities like water, electricity, cot, bed, pillow, bedspread and air-conditioner is given out on rent - The devotee is also given cooking facililty in this unit, therefore, the unit of accommodation of this kind which is termed by the appellant as a 2BHK category I type of accommodation cannot be considered as renting of rooms and will not be covered against Sr. no. 13 of 12/2017-CTR - similarly, renting of beds in a dormitory is also not akin to renting of rooms and hence it will not qualify for exemption under Serial 13(b) of 12/2017-CTR - Appellate Authority, therefore, agrees with the Authority for Advance Ruling and holds that the renting of the 2BHK unit and the dormitory will be chargeable to GST as a single unit where the value of supply will be the charges for the full 2BHK unit/dormitory and not the charges for each room/bed and is liable to tax in terms of Entry no. 7 of 11/2017-CTR - order of AAR upheld and appeal dismissed: AAAR

- Appeal dismissed: AAAR

2020-TIOL-28-AAAR-GST

Maarq Spaces Pvt Ltd

GST - Applicant entered into a Joint Development Agreement (JDA) with landowners for development of land into residential layout along with specification and amenities - consideration was agreed on revenue sharing basis in the ratio of 75% for landowner and agreement holder and 25% for applicant - cost of development was to be borne by the applicant - pursuant to JDA, the applicant had entered into an agreement with customers for sale of developed plots for consideration - Applicant sought to know as to whether the activity of development and sale of land attract tax under GST and if the answer is in the affirmative, for the purpose of taxable value, whether the provision of rule 31 of Rules can be made applicable in ascertaining the value of land and supply of service - Authority held that Applicant has no right in the title of the land and, therefore, they cannot be considered as the sellers of the plots; that they are only service providers in the whole process, be it development of the raw land into residential plots or their sale after the development, therefore, entire amount received by them is liable to be taxed under GST; that Rule 31 of the Rules applies in the instant case and the value of the supply is equal to the total amount received by the applicant, which is equal to 25% of the open market value of each plot - Appeal to the Appellate authority.

Held: In real estate transactions involving plotted development, one party owns the land and another party has the expertise to develop the land - The two parties come together with the common intention of developing the land and sharing the revenue accruing for the sale of the developed plots in the land - however, the landowners give the rights of using the land to the developer in exchange for which, the developer gives the service of developing the land of the owners - while the joint development agreement is entered into for the two parties to jointly reap the benefits of the sale of the land to customers, there is a clear rendering of a service by the developer to the landowner in developing the land which belongs to the landowner - therefore, the activity of developing the land is a supply of service by the appellant - A combination of two activities, one of which is not a supply under GST cannot be said to be a composite supply - Findings of the lower Authority upheld and appeal dismissed: AAAR 

- Appeal dismissed: AAAR

2020-TIOL-27-AAAR-GST

Tata Coffee Ltd

GST - AAR had held that the t ransaction of depositing timber with the Government Timber depot (auctioneer) for disposal as per s.104 of the Karnataka Forest Act amounts to "supply" and GST is chargeable - value would be the open market value or the value as determined u/r 30 or 31 of the Rules; that t here is no provision in the GST Act for shifting the tax liability and considering that as a deemed discharge of liability; that there are two supplies involved in the chain of transactions, one when the timber is handed over to depot by applicant and the other when the said timber is sold by depot; that both are independent supplies and tax needs to be discharged at both stages, time of supply being the time of removal; that activity of providing supervision services is not covered in exceptions in Entry 5 of 13/2017-CTR and is liable to tax under reverse charge; that in case the timber depots are not government departments, then the depot shall collect GST and issue invoice to applicant - Appeal to AAAR. 

Held: In the instant case, there is a transaction in goods inasmuch as timber is being deposited by the appellant with the Government Timber Depot (GTD) - This transaction is mandated by a statute i.e. the Karnataka Forest Act, 1963 - further, the activity of felling the timber trees is part of the shade management policy of the appellant in the course of their business of coffee/tea/pepper plantations, however, the activity of depositing the timber into the GTD does not result in realisation of consideration immediately - where the consideration is not extant in a transaction, such a transaction does not fall within the ambit of supply but in certain scenarios as elucidated in Schedule I of the CGST Act, 2017, the key element of consideration is not required to be present for treating the activity as supply - notwithstanding the fact that the depot is set up under the aegis of a statute, it functions in the capacity of an agent - in the instant case, once the lot of timber is sold to a successful bidder, the purchaser is required to pay 1/4th value of the timber purchased along with applicable taxes and later the balance dues - therefore, it is observed that the sale of timber happens through the GTD and not to the GTD as claimed by the appellant - the proceeds of the timber sold through the auction process by GTD is given to appellant on completion of the auction process, hence GTD acts in the capacity of an agent of the appellant and this transaction amounts to a supply in terms of clause 3 of Schedule I of the Act - time of supply will be the date of issue of invoice which will be at the time of removal of the timber by the appellant to the depot - appellant has not disputed the ruling with regard to taxability of supervision charges - accordingly, the ruling given by the lower authority is upheld: AAAR

- Appeal dismissed: AAAR 

2020-TIOL-26-AAAR-GST

Wework India Management Pvt Ltd

GST - Appellant is in the business of supplying shared workspace/office space to the freelancers, startups, small businesses and large enterprises - to this end, the applicant procures goods and services from various contractors for fitting-out of the workspace and provides the said workspace on rent to various companies and individuals as sharing work-spaces - applicant had sought to know from the AAR whether they are eligible to avail ITC on the detachable 14mm Engineered wood with Oak Top wooden flooring which is movable in nature and capitalised as 'furniture and fixture' and is not capitalised as 'immovable property' - they also sought to know as to whether they are entitled to avail ITC on detachable sliding and stacking glass partition which is movable in nature and capitalised as ‘furniture and fixture' and is not capitalised as 'immovable property' - AAR had observed that Detachable wooden flooring and sliding and stacking of glass partitions are fixed to the buildings to create the office spaces and hence is a sine qua non for letting out of the office spaces; that there cannot be office space unless these are fixed and hence it can be said to be permanently fastened to the building; that since this activity amounts to addition or alteration to an immovable property, ITC is not available - Insofar as fixing of 14mm Engineering wood with Oak top wooden flooring is concerned, the same can be easily detached and reused as it only adds to the value to the building and is not sine qua non for the office space unlike the partitions and it is not covered under ‘construction of immovable property' and, therefore, ITC of GST is not available on the detachable sliding and stacking glass partition but ITC is available on the detachable 14mm Engineered Wood with Oak top wooden flooring - Appeal filed before the AAAR against the portion of the order that denies the ITC on detachable sliding and stacking glass partitions.

Held: Glass partitions are not permanent and are not embedded to the earth - They can be dismantled and moved according to the requirements of the clients of the appellant - although they are fixed to the earth with nuts and bolts, they can be dismantled without demolishing the civil structure, therefore, the detachable sliding and stackable glass partitions do not qualify as 'immovable property' - further, the detachable sliding and stackable glass partitions are accounted in the books of account as ‘fixed assets' under the head 'furniture and fixtures' - They are not capitalised as immovable property but rather as movable assets - intention of fixing the glass partitions is only to provide clients with a certain sense of privacy and for the purpose of demarcation of work space area; there is no permanency in affixing such partitions as the same can be dismantled and re-fixed to signify a change in the dimensions of the work space - fixing of partitions to the ground using nuts and bolts only serves to give a false sense of permanency while in reality it is not so - therefore, procurement of detachable sliding and stackable glass partitions will be eligible for ITC and will not be hit by the provisions of s.17(5)(d) of the CGST Act, 2017 - this portion of the order of AAR is set aside and appeal is allowed: AAAR

- Appeal allowed: AAAR

2020-TIOL-25-NAA-GST

Director General Of Anti-Profiteering Vs JK Helene Curties Ltd

GST - Anti-Profiteering - s.171 of the CGST Act, 2017 - DGAP was requested to conduct a detailed investigation as per rule 129(1) of the CGST Rules, 2017 in the matter of the allegation that M/s Raymond Ltd. had not passed on the benefit of tax reduction from 28% to 18% w.e.f 15.11.2017 on 'After-Shave lotion Park Avenue Good Morning 50 ml' which was supplied to M/s Big Bazar, Inderlok run by M/s Future Retail Ltd. on 08.11.2017 under Purchase Order with MRP of Rs.115/- per unit, on 19.12.2017 under PO with the same MRP of Rs.115/- per unit and on 12.06.2018 vide PO again with the same MRP of Rs.115/- per unit - report submitted by DGAP and respondents have also filed replies to the same and were heard by the Authority.

Held: There was no reason for the respondents to increase their base prices exactly equal to the rate of tax reduction w.e.f 15.11.2017 - Such a coincidence is incomprehensible, strange and unheard of which shows that the respondents have deliberately tried to pocket the benefit of tax reduction to enrich themselves at the expense of the vulnerable customers - accordingly, on the basis of the pre and post reduction GST rates and the details of the outward taxable supplies of the impacted products made during the period 15.11.2017 to 31.03.2019 the profiteered amount in respect of respondent no. 1 has been rightly computed at Rs.18,48,43,084/- channel/customer wise including the GST, details of which have been mentioned in the report dated 24.09.2019 of DGAP; this amount includes an amount of Rs.8,97,253/- including GST which the respondent no. 1 has profiteered from respondent no. 2 - state wise profiteered amount has been calculated as Rs.38,64,891/- including GST in respect of respondent no. 2 - DGAP is bound to investigate all such cases in respect of which the above benefits are required to be passed on and furnish report accordingly to the Authority once the violation of the provisions of s.171 come to his notice during the course of investigation - DGAP is legally required to investigate and bring before the Authority all those registered persons who have failed to pass on both the above benefits not withstanding whether any allegation has been received against them or not once he has become aware of such violation - during the course of investigation, the DGAP had further found that the respondents had not passed on the benefit of tax reduction in respect of other products also which were being supplied by them inspite of tax reduction and, therefore, he was legally bound to investigate and bring this infringement of s.171 to the notice of the Authority - respondents cannot be allowed to deny the benefit of tax reduction to their customers on the ground of jurisdiction and misappropriate the amount of benefit of tax reduction which they were not required to pay from their own pockets - respondent has not kept the pre and post rate reduction base prices the same and has thus profiteered to the extent of Rs.6.49 per unit of the impugned product and has denied the benefit of tax reduction - claim of respondent that wherever it was feasible to increase the grammage instead of reducing the MRPs he had increased the same from January 2018 is without any evidence and cannot be relied upon - plea of the respondent that post 15.11.2017 he had reduced the rate of GST from 28% to 18% in the invoices issued by them to their customers and hence they had passed on the benefit of tax reduction to the customers is wrong and misleading as mere charging of GST @18% after the tax reduction does not amount to passing on the benefit of tax reduction in view of the fact that the respondent had increased the base prices of his products w.e.f 15.11.2017 and then charged GST @18% on them whereas he was legally bound not to increase the base price - respondent had continued to charge the same cum-tax prices which he was charging before the tax reduction and hence, he has not passed on the benefit of tax reduction - such hollow plea of respondent cannot be accepted - respondent was required to stamp or re-sticker or re-print the MRPs on all the impacted SKUs as per the letter issued by the Ministry of Consumer Affairs, Food and Public Distribution, GOI dated 16.11.2017, however, respondent had not complied with the above direction and has continued to sell his impacted SKUs at the pre-reduction MRPs - respondent had simply transferred his legal obligation to his distributors who had no power to re-fix the MRPs and stamp/re-sticker/print them on the impacted SKUs - since the MRPs were not reduced and affixed on the above SKUs by the respondent there is no likelihood of their being sold to the consumers at the commensurate reduced MRPs keeping in view the above rate reduction - respondent has, therefore, acted in contravention of s.171(1) of the Act - absence of Judicial Member does not cause any prejudice to the respondent, hence their contention that the constitution of the Authority is illegal is untenable - It is accordingly held that the amount of profiteering in the case of respondent no. 1 is Rs.18,48,34,084/- and in respect of respondent no. 2 is Rs.38,64,891/- - since the recipients in this case are not identifiable, these amounts are required to be deposited in the Consumer Welfare Funds of the Central and State governments concerned as per the provisions of rule 133(3)(c) of the Rules, 2017 in the ratio of 50:50 along with interest @18% - for the aforementioned contraventions, penalty is imposable u/s 171(3A) of the Act, 2017 - amount to be deposited within a period of three months and a report is required to be submitted by the Commissioners concerned within four months - due to COVID-19 pandemic the order could not be passed on or before 24.03.2020 as mandated by rule 133(1) of the Rules, 2017 but is being passed on 11.05.2020 in view of notification 35/2020-CT dated 03.04.2020: NAA

Applications disposed of: NAA

2020-TIOL-942-HC-AHM-VAT

Niko Resources Ltd Vs State Of Gujarat

Whether when CBDT circulars confer discretion upon the Appellate Authority in appropriate cases to entertain the appeal without the payment of tax with the penalty or smaller payment, there is no case for the Revenue to straightway dismiss the assessee's appeal only for non-payment of the pre-deposit amount - YES: HC 

- Assessee's writ petition allowed: GUJARAT HIGH COURT

SERVICE TAX

2020-TIOL-748-CESTAT-DEL

Commissioner of Central Excise, Customs Central Goods and Service Tax Vs Blackberry India Pvt Ltd

ST - The assessee-company is engaged in export of services - It availed CENVAT credit as per the CCR 2004 - Rule 5 thereof permits a manufacturer who exports his goods or a service provider who exports services to claim refund of the CENVAT Credit which was used in exported goods or exported services, subject to the procedure, conditions and limitations notified by the Board in Notfn No 27/2012-CE (NT) - The assessee filed refund claims in respect of services exported in the relevant period - The original authority allowed part of the refund and rejected the other part on grounds of limitation - On appeal, the Commr.(A) provided relief to the assessee - Hence the Revenue's appeal.

Held - There is no case in which Section 11B mandates that the date of invoice must be considered as the relevant date - The residual category under section 11B is the date of payment of duty - In this case there is no payment of duty at all - If this residual category is considered, the relevant date will never begin - The Tribunal has considered as to what constitutes an export of service under the Export of Service Rules and concluded that the date of realisation of foreign exchange must be the relevant date - If the export is not complete, the exporter of services is not entitled to claim refund under Rule 5 of CCR 2004 - Harmoniously reading the Export of Services Rules and Section 11B of Central Excise Act, 1944, the Tribunal has held a view that in case of export of services, the relevant date must be the date of realisation of foreign exchange - The CBIC arrived at a similar conclusion when it issued Notfn No 14/2016-CE(NT) - The Revenue sought for setting aside the order of the CIT(A), when the order has been issued following the ratio of the orders of the Tribunal as judicial discipline requires - Hence present appeal is frivolous: CESTAT

- Revenue's appeal dismissed: DELHI CESTAT

CENTRAL EXCISE

2020-TIOL-747-CESTAT-DEL

Alstone Industries Pvt Ltd Vs Commissioner, CGST

CX - The assessee-company has its factory in Rajasthan, while its Head Office is located in New Delhi - It is engaged in manufacturing synthetic rubber, plastic sheets, UPVC door and window which are dutiable - Upon audit of records, it was revealed that the assessee had obtained service tax registration and ST-3 certificate for its factory and the same had been amended to also include the Head Office and further services such as Management or Business Consultant Service/Security Detective Service, Manpower Recruitment and Supply Agency Service and GTA Service (from depot) were added - It also appeared to the Revenue that the assessee's factory availed CENVAT credit of service tax on the basis of challan and invouces paid by its Head Officer without getting the Head Office registered as Input Service Distributor - Hence it appeared that as per Rule 9 of CCR, CENVAT credit could be availed on the basis of specified documents, whereas the assessee had availed credit based on the challan only and which was not paid by the assessee's factory but by its head office - SCN was issued proposing recovery of credit with interest and penalty u/s 11AC of CEA 1944 was proposed to be imposed - On adjudication, the proposals in the SCN were sustained - On appeal, the Commr.(A) sustained such findings - Hence present appeal.

Held - The assessee-company admittedly had only one factory and with its Head Office being located at Delhi, it has common registration under the centralised registration scheme - There is no question involved of distribution - Hence the assessee is not required to be registered as an ISD for its head office - Admittedly, the services of GST and Manpower Supply Agency service have been received only for the sake of accounting at Head Office, there can be no disallowance - In such acts and circumstances, the factory and Head Office have one common existence under the Service Tax Rules, which is evident from the centralised registration certificate - In view of the common registration number under the centralised registration scheme, the O-i-A in challenge is not maintainable and merits being set aside: CESTAT

- Assessee's appeal allowed: DELHI CESTAT

Andhra Pradesh Granite Midwest Pvt Ltd Vs CCT

CX - The assessee is engaged in manufacture and export of granite blocks - They filed an application seeking refund of unutilised CENVAT Credit under Rule 5 of CCR, 2004 - The original authority while sanctioning the refund had erroneously also taken into account the sales to 100% EOUs while calculating the amount of refund - On appeal, first appellate authority held that as per the CCR, 2004 as applicable during the relevant period did not provide for inclusion of sales to 100% EOUs while calculating the refund claim under Rule 5 - Accordingly, the first appellate authority allowed the Revenue's appeal - Both the Asst. Commissioner and Commissioner (A) are fully competent to decide the SCN not only in terms of CCR, 2004 but also in terms of provisions of CGST Act, 2017 - At this stage, no inconsistency found in the order of the first appellate authority inasmuch as he has followed the law as it applied during the relevant period - The assessee has so far not been put to any disadvantage because the SCN proposing recovery of excess refund is yet to be adjudicated upon by the Asst. Commissioner - The impugned order is upheld: CESTAT

- Appeal rejected: HYDERABAD CESTAT

Manika Processors Vs CCE

CX - Manmade/cotton fabrics - Allegation is use of power/electricity in processing of fabrics - In the matter of the appeal filed by other two co-noticees, the Tribunal had by its Final Order No. A/61043-61044/2019-EX[DB] dated 04.04.2019 held that demand of Central Excise duty is absolutely on the flimsy ground and, therefore, the order-in-originals under challenge was legally not sustainable and therefore, as the same were without any merits, were set aside - Since nothing new has been brought on record to challenge the findings recorded by the Tribunal in the order in respect of appreciation of evidences or the interpretation of law, following the judicial precedence, the present Appeal is allowed: CESTAT [para 4.2, 4.3, 5.1]

- Appeal allowed: CHANDIGARH CESTAT

CUSTOMS

2020-TIOL-937-HC-AHM-CUS

Lazio Exports Vs UoI

Cus - Grievance on the part of the petitioner is that no re adjudication has taken place and after 8 years of such order by CESTAT, the Commissioner of Customs, Navrangpura, Ahmedabad has issued letter F.No. VIII/10-17/Commr/O&A/2019 and once again has issued show cause notice for readjudication of the matter, which was scheduled to be heard on 18.02.2020.

Held: Petitioner has directly approached this Court against the show cause notice raising all contentions in these petitions - When efficacious remedy in alternative is available, this Court ought not enter into the merits of the matters - Any such reply if is made, the authority concerned would decide the matters in accordance with law, without being influenced by disposal of this matters: High Court [para 5]

- Petition disposed of: GUJARAT HIGH COURT

2020-TIOL-744-CESTAT-DEL

Binatone Telecommunication Pvt Ltd Vs CC

Cus - The assessee filed a BoE for clearance of imported goods declared as mobile phones, along with invoices showing the details of quantum and value of mobile phones - The import of such phones required under Electronic and Information Technology Goods (Requirement for Compulsory Registration) Order, 2012, issued by the Ministry of Electronics and Information Technology in terms of powers conferred by the Bureau of Indian Standards Act, 1986, and Bureau of Indian Standards Rules, 1987 - During course of examination of the goods, it was found that though the assessee had the necessary permission to import the phones, but the same were found to be having batteries which were not inbuilt and were not conforming to BIS standard - Neither NEBIS Mark was found on the goods nor any BIS registration was submitted - Upon investigation, the assessee requested storage of the goods in Customs bonded warehouse till they receive the required BIS registration for mobile batteries - Such certificate was obtained by the assessee from BIS and so requested clearance of the goods - Subsequently, the adjudicating authority confiscated the goods with liberty to redeem the same on payment of fine - Penalty was also imposed u/s 112(a)(i) of the Customs Act - On appeal, the Commr.(A) reduced the quantum of redemption fine & penalty - Hence the present appeal.

Held - Considering the order of the Commr.(A), it can be concluded that the non procurement of certificates for the batteries was bona fide and inadvertent error on part of the assessee - In any case, the assessee subsequently produced the certificate and as such made good the lapse - In such circumstances, imposition of penalty on the assessee is not justified and merits being set aside - Regarding the confiscation of the batteries, the same were without a certificate, albeit under bona fide belief - Hence their confiscation merits being upheld - However, the quantum of the redemption fine is reduced considering the facts and circumstances: CESTAT

- Assessee's appeal partly allowed: DELHI CESTAT

TII

TP - High risk bearing company can be adopted as comparable to company which is risk mitigating company and which is captive service provider: ITAT

TP - Directions of DRP to recompute TP adjustment, merit being trifled with, where DRP rightly directed dropping of certain comparables which failed employee cost filter and where gains/losses from forex fluctuation was directed to be excluded: ITAT

TIOL CORPLAWS

Code of Civil Procedure - Defendants are entitled to condonation of delay in seeking setting aside of decree as at no earlier point of time they had opportunity to know about passing of ex-parte decree: HC

Arbitration & Conciliation - Finding of Arbitrator allowing claim towards margins on targets achieved is pure finding of fact based on appreciation of evidence hence it is not open to interference by Court u/s 34 of Act: HC