2020-TIOL-1131-HC-KERALA-GST

Bijeesh P V Vs Superintendent Of Central Tax And Central Excise

GST - Petitioner submits that there was a minor delay in filing the GST returns for various periods and as a result thereof, the petitioner was served with a demand notice dated 13.03.2020 by Superintendent of Central Tax and Central Excise, Tirur, demanding an amount of Rs.9,72,519/-; that the aforementioned demand notice is based on the gross tax instead of net tax and has to exclude the input tax credit – Petitioner further submits that they had submitted a representation; but thereafter on 12.06.2020, GST Council recommended to give reduction in Late Fee for past GST Returns and other measures to reduce the burden of the taxpayers such as Late Fee, Interest etc. - It is in these circumstances, the petitioner has approached this Court for a direction to consider the representation for certain relaxed measures promulgated by GST Council, as the threat of initiation of coercive measures in the absence of payment of the demand is writ large.

Held: Concededly, the case of the petitioner is that there was delay in filing GST returns - Demand notice includes the interest as well as the gross tax whereas it should have been on the net tax excluding the input tax credits - Bench is not commenting further as it would be in the domain of the competent authority to take a call on the representation keeping in view of certain relaxed measures extended by GST Council - Petition is disposed of by directing the 1st respondent to afford an opportunity of being heard to the petitioner with regard to the details expressed in the representation and take a decision as expeditiously as possible within a period of two months - It is made clear that till such time, the operation of Exhibit-P7 demand notice is ordered to be kept in abeyance - The petitioner, however, shall be at liberty to file returns from time to time which would be without prejudice to the decision contemplated to be taken in pursuance to the directions of this Court: High Court [para 6]

2020-TIOL-1130-HC-P&H-GST

Modern Motor Works Vs UoI

GST -  Petitioner challenges vires of Rule 117(1A) of CGST Rules, 2017 and seeks direction to Respondent to permit Petitioner to electronically upload form TRAN-1 in order to avail credit of excess VAT reflected in Returns, as due to technical glitches on the GST Portal, the petitioner could not file Form TRAN-I - Petitioner contends that issue involved is squarely covered by judgment of this Court in the case of Adfert Technologies Pvt. Ltd. -  2019-TIOL-2519-HC-P&H-GST , SLP filed by Revenue against aforesaid decision havine been dismissed - Petitioner also submits that Delhi High Court in the case of Brand Equity Treaties Ltd.  2020-TIOL-900-HC-Del-GST has permitted Petitioners to file TRAN-I on or before 30.06.2020 and further directed the Respondents Revenue to permit all other similarly situated tax payers to file TRAN-I on or before 30.06.2020; that this opinion has been approved in SKH Sheet Metals Components - 2020-TIOL-1031-HC-DEL-GST . 

Held:  Delhi High Court though has not declared Rule 117(1A) ultra vires the Constitution, nonetheless treated as violative of Article 14 of Constitution of India being arbitrary, discriminatory and unreasonable - in the instant case, the Petitioner has challenged vires of Rule 117 (1A) of Rules, however Bench does not think it appropriate to declare it invalid as it is of the considered opinion that Petitioner is entitled to carry forward Cenvat Credit accrued under Central Excise Act, 1944 - Repeated extensions of last date to file TRAN-1 in case of technical glitches as understood by Respondent vindicate claim of the Petitioner that denial of unutilized credit to those dealers who are unable to furnish evidence of attempt to upload TRAN-1 would amount to violation of Article 14 as well Article 300A of the Constitution of India - In view of decision of this Court in the case of Adfert Technologies Pvt. Ltd. (supra) and Delhi High Court in the case of Brand Equity Treaties Ltd. (supra) present petition deserves to be allowed and is accordingly allowed - The Respondents are directed to permit Petitioner to upload TRAN-1 on or before 30.06.2020 and in case Respondent fails to do so, the Petitioner would be at liberty to avail ITC in question in GSTR-3B of July 2020 - respondents would be at liberty to verify genuineness of claim(s) made by Petitioner: High Court [para 7 to 9]

2020-TIOL-1129-HC-P&H-GST

Haryana Mill Store Vs UoI

GST -   Petitioner challenges vires of Rule 117(1A) of CGST Rules, 2017 and seeks direction to Respondent to permit Petitioner to electronically upload form TRAN-1 in order to avail credit of excess VAT reflected in Returns, as due to technical glitches on the GST Portal, the petitioner could not file Form TRAN-I - Petitioner contends that issue involved is squarely covered by judgment of this Court in the case of Adfert Technologies Pvt. Ltd. -  2019-TIOL-2519-HC-P&H-GST , SLP filed by Revenue against aforesaid decision havine been dismissed - Petitioner also submits that Delhi High Court in the case of Brand Equity Treaties Ltd.  2020-TIOL-900-HC-Del-GST has permitted Petitioners to file TRAN-I on or before 30.06.2020 and further directed the Respondents Revenue to permit all other similarly situated tax payers to file TRAN-I on or before 30.06.2020; that this opinion has been approved in SKH Sheet Metals Components - 2020-TIOL-1031-HC-DEL-GST . 

Held:  Delhi High Court though has not declared Rule 117(1A) ultra vires the Constitution, nonetheless treated as violative of Article 14 of Constitution of India being arbitrary, discriminatory and unreasonable - in the instant case, the Petitioner has challenged vires of Rule 117 (1A) of Rules, however Bench does not think it appropriate to declare it invalid as it is of the considered opinion that Petitioner is entitled to carry forward Cenvat Credit accrued under Central Excise Act, 1944 - Repeated extensions of last date to file TRAN-1 in case of technical glitches as understood by Respondent vindicate claim of the Petitioner that denial of unutilized credit to those dealers who are unable to furnish evidence of attempt to upload TRAN-1 would amount to violation of Article 14 as well Article 300A of the Constitution of India - In view of decision of this Court in the case of Adfert Technologies Pvt. Ltd. (supra) and Delhi High Court in the case of Brand Equity Treaties Ltd. (supra) present petition deserves to be allowed and is accordingly allowed - The Respondents are directed to permit Petitioner to upload TRAN-1 on or before 30.06.2020 and in case Respondent fails to do so, the Petitioner would be at liberty to avail ITC in question in GSTR-3B of July 2020 - respondents would be at liberty to verify genuineness of claim(s) made by Petitioner: High Court [para 7 to 9]

- Petition allowed : PUNJAB AND HARYANA HIGH COURT

2020-TIOL-1126-HC-MAD-VAT

CIBI Sago Factory Vs Assistant Commissioner (CT)

TNVAT - The petitioner is the manufacturer of sago and starch and registered dealer on the file of respondent under TNGST Act and now under the TNVAT Act - Without issuing any notice, the respondent served an assessment order to the petitioner, alleging that as per the inspection conducted by Enforcement Wing Officials, it was found that there was suppression of sales turnover to the tune of Rs.1,17,77,400/- on the basis of electricity consumed during assessment year in question and hence, the petitioner was directed to pay tax along with penalty under Section 12(3)(b) of TNGST Act - It is the specific plea of petitioner that the respondent before making revised assessment, has not provided reasonable opportunity to the petitioner to furnish the books of accounts maintained for the relevant year - Whereas, according to the respondent, though the petitioner was summoned to produce the books of accounts, they have not turned up and hence, the order impugned herein, came to be passed, based on the power consumption - It is well settled that the electricity consumption cannot be adopted as the sole basis for rejecting the accounts of assessee and for making an estimate of the taxable turnover of assessee - Such being the legal position, the impugned revised order is set aside and the matter is remanded back to the respondent for fresh consideration: HC

- Matter remanded: MADRAS HIGH COURT

2020-TIOL-1128-HC-DEL-ST

BSA Citi Courier Pvt Ltd Vs Commissioner of CGST

ST - SVLDRS, 2019 - Petitioner challenges the communication dated 05th March, 2020 whereby the declaration filed by the petitioner, under Sabka Vishwas (Legacy Dispute Resolution) Scheme 2019, only for waiver of interest from April, 2015 to June, 2017 has been rejected without affording any opportunity of hearing by stating - "the date of communication declared is 05.09.2019 which is beyond the cut-off date (i.e. 30.06.2019). Therefore the application cannot be accepted under section 125(1)(e) of Chapter V of Finance Act, 2019" - Revenue counsel submits that the quantification in the present case was done post 30th June, 2019 and was communicated to the petitioner for the first time on 05th September, 2019; that, therefore, the petitioner cannot rely on the internal correspondences/communications between different departments of the respondents to contend that the quantification took place in March, 2019.

Held: Court finds that the impugned communication dated 05th March, 2020 has been issued by the respondents without giving an opportunity of hearing to the petitioner and without considering the case put forward by the petitioner - Consequently, the present writ petition and pending application are disposed of by setting aside the order/communication dated 05th March, 2020 and by directing the respondent No.2 to give a hearing to the petitioner on 09th July, 2020 at 11.30 a.m: High Court [para 6, 7]

Kunnel Engineers And Contractors Pvt Ltd Vs CC, CE & ST

ST - It is not in dispute that earlier, appellant was paying service tax under CICS and CCS after availing 67% abatement from the value in terms of Notification No.15/2004 dt. 10/09/2004, No.18/2005 dt. 09/06/2005 and Notification No.01/2006 dt. 01/03/2006 - The benefit of abatement was sought to be denied on the ground that the appellant had not included the value of material supplied free of cost by the service recipient - This issue is no longer res integra in the light of the Larger Bench decision of the Tribunal in the case of Bhayana Builders Pvt. Ltd. - 2013-TIOL-1331-CESTAT-DEL-LB  [upheld by Apex Court  - 2018-TIOL-66-SC-ST wherein it has been held that while claiming abatement of 67% under these services, the value of material supplied by the customers need not be included - Further,  from 0/06/2007, a new taxable service viz. WCS was introduced under Section 65(105)(zzzza) of the Finance Act, 1994 - After the introduction of WCS, the appellant had started paying service tax by classifying their services into WCS and started availing the benefit of (Composition scheme for payment of service tax) under Service Tax Rules, 2007 - Revenue raised the objection by issuing show-cause notices alleging that the appellant is liable to pay service tax under CICS/CCS only and changing the classification into WCS midway is not permissible - So much so, the Revenue was of the view that even in respect of the fresh contracts after 01/06/2007, the appellant was liable to classify the same only under CICS/CCS - Since they have not exercised their option to pay service tax under the composition scheme under WCS and accordingly both in respect of ongoing contracts as well as fresh contract, demand of service tax has been confirmed under CICS/CCS without granting the benefit of 67% abatement on the ground that some of the material were supplied by the customers - appeal filed before CESTAT.

Held: There was considerable litigation on the issue whether service tax can be levied on individual WCS prior to its introduction from 01/06/2007 and the same was finally settled by the Apex Court in the case of CCE Vs. L&T Ltd. - 2015-TIOL-187-SC-ST - The levy of service tax on CICS/CCS would be applicable only in case of pure service contracts whereas composite contracts involving transfer of property in goods would be liable to service tax only under WCS from 01/06/2007 as statutory mechanism to arrive at the value of service has been prescribed only under WCS from 01/06/2007 - The Apex Court held that since the Finance Act had not laid down any charge or machinery to levy and assess service tax on individual WCS prior to 01/06/2006, hence the levy on such composite WCS prior to that date has no constitutional validity - In the present appeal also, there is no dispute that the construction activities are in the nature of composite work and hence the decision of the Apex Court in L&T Ltd. is squarely applicable to the facts of the present case - By following the ratio of the Apex Court decision cited supra, it has been held by Chennai CESTAT in the case of Real Value Promoters Pvt. Ltd. - 2018-TIOL-2867-CESTAT-MAD that a composite contract can be subject to service tax only under WCS post 01/06/2007 and any demand under CICS/CCS on such composite contracts is not sustainable - CBIC has in its subsequent circular bearing No.128/10/2020 dt. 24/08/2010 clarified that in respect of ongoing contracts, the classification would change to WCS post 01/06/2007, though the benefit of composition scheme is not available, hence the demand confirmed by the Commissioner under CICS/CCS is contrary to this clarification and the reliance placed on earlier circular No.98/1/2008 dt. 04/01/2008 is not valid - It is pertinent to note that after the decision of the Apex Court in L&T Ltd. wherein it has been held that prior to 01/06/2007, composite contracts are not at all liable to set aside under CICS/CCS, any tax paid by the appellant under these categories of services is a payment under a mistake of law - In the case of L&T Ltd., it has been held that since no service tax was payable prior to 01/06/2007, opting for composition scheme under WCS is not barred, even if tax was wrongly paid prior to 01/06/2007 - Tribunal vide Final order No.50871/2018 dt. 06/03/2018 in the case of Vaishno Associates Vs. CCE - 2018-TIOL-1486-CESTAT-DEL had occasion to consider this issue and held that for sole reason of not filing the intimation opting to pay service tax under WCS, the demand cannot sustain: CESTAT [para 6.2, 6.3]

Limitation - Bench finds that demand for the period from December 2005 to March 2009 has been raised by issue of show-cause notice on 22/07/2010 which is beyond the normal period of one year from the due date for filing the return - Bench notes that appellants have been paying service tax under CICS and CCS by claiming abatement though no service tax was held to be payable - Further, the levy of service tax on construction related activities has undergone several changes which led to lot of litigation during the relevant period and even the CBIC has recognized such confusions in various circulars issued by them - In such circumstances, Bench does not find any justification for invoking the extended period of limitation and the demand for the period from December 2005 to March 2009 is set aside being barred by limitation - impugned order is liable to be set aside - Appeal of the appellant is allowed by setting aside the impugned order: CESTAT [para 8, 9]

- Appeal allowed: BANGALORE CESTAT

2020-TIOL-951-CESTAT-KOL

Kedia Computer Services Vs CCE, C & ST

ST - The assessee is a Distributor/Re-Seller of BSNL's cellular product like Sim Card, Recharge Vouchers and ITC card - They purchases the said products from BSNL at wholesale prices and sells them at retail prices - The difference between the wholesale price and the retail price is the profit margin of assessee - The relationship between assessee and BSNL is that of the Buyer and Seller - The BSNL pays service tax on the said cellular product at basic price which includes assessee's profit margin - While dealing with the similar facts and circumstances in the case of Chotey Lal Radhey Shyam 2018-TIOL-300-HC-ALL-CX , it is held that there is no agency service or sales promotion service provided in such transactions, but it is a case of sale/purchase of item from BSNL on principle to principle basis which is pure trading activity and on the cellular products, the BSNL has already discharged Service Tax, hence, demanding service tax again from the trader would amount to double taxation - The case of assessee is squarely covered by the ratio of said decision - Accordingly, the impugned Order is set aside: CESTAT

- Appeals allowed: KOLKATA CESTAT

2020-TIOL-950-CESTAT-HYD

Flytech Media Pvt Ltd Vs CCE, C & ST

ST - This appeal is filed against order-in-revision dated 11.03.2011 - According to assessee, they are entitled to appeal before this Bench against the order-in-revision as per the order in case of T.A. Pai Management Institute 2012-TIOL-911-CESTAT-BANG whereas Revenue relies on the order in case of Zee Entertainment Enterprises Ltd 2016-TIOL-2780-CESTAT-MUM - The orders of Bangalore Bench of Tribunal and Tribunal Mumbai are contrary to each other - Both cases involve the question as to whether the Tribunal has a right to entertain appeals against orders-in-revision after 19.08.2009 in the absence of any explicit provisions by way of saving clause in section 86 of FA, 1994 - The only difference is that in case of T.A. Pai, it was the assessee who wanted to appeal before Tribunal Bangalore and the appeal was allowed as maintainable and in the case of Zee Entertainment Enterprises, the Revenue wanted to appeal before the Tribunal Mumbai which has been held as not maintainable - The same yardstick should be applied regardless of which party appeals and in view of the conflicting decisions between the Tribunal Bangalore and the Tribunal Mumbai, this is a fit case to be referred to larger bench for a decision on the maintainability of appeals filed under Section 86 after 19.08.2009 by both the Revenue and the assessee against orders-in-revision passed by the Commissioners - Registry is directed to present the file before President for constitution of a larger bench to decide the question, whether appeals by Revenue and assessee against orders-in-revision passed after 19.08.2009 maintainable before the CESTAT in the absence of any specific saving clause in Section 86 of the Finance Act 1994: CESTAT

- Case referred: HYDERABAD CESTAT

2020-TIOL-1127-HC-DEL-CUS

AG India Retail Pvt Ltd Vs Dy.CC

Cus - Petitioner imported vide Bill of Entry No.7955006 dated 20th June 2020, 4,40,525 pieces of ball bearings worth US $ 1,51,170.50 and paid Customs duty of Rs.32,15,212/- on 23rd June, 2020 - It is submitted by the petitioner that because of inaction on the part of the respondents in clearing the goods for import the present petition has been preferred; that there is no illegality in the import of the goods in question - Counsel for respondents stated that on 24th June, 2020 a communication was sent to the petitioner's Custom House Agent to register the Bill of Entry dated 20th June, 2020, as per the procedure prescribed under Customs Manual; that this process is yet to be completed by the petitioner; that once the Bill of Entry is registered, thereafter, 100% examination of the goods, that is, First Check of the goods will be done as per the procedure laid down under the Customs Manual - Petitioner denies having received the aforesaid communication dated 24th June, 2020.

Held: Respondents shall take instructions and file a counter affidavit before the next date of hearing - In the meanwhile, the process of examination of the goods may be completed with the cooperation of petitioner, in accordance with law - Matter listed on 16.07.2020: High Court [para 6, 7]

- Matter listed : DELHI HIGH COURT

2020-TIOL-1125-HC-DEL-COFEPOSA