NA International Vs UoI

GST - Petitioner is aggrieved by the inaction on the part of the respondents in not releasing the IGST and amount of duty drawbacks due to them – Bench, therefore, directs the respondent authorities concerned to decide the question of release or otherwise of IGST along with interest as well as the release or otherwise of duty drawback due to the petitioner in accordance with law, rules, regulations and Government policies applicable to the facts of the case, as early as possible and preferably within a period of three weeks - petitioner shall thereafter be at liberty to challenge the order passed by the respondents, if so advised, along with the other grievances raised in this writ petition – Petition disposed of: High Court [para 4 to 6]

- Petition disposed of: DELHI HIGH COURT

2020-TIOL-1372-HC-DEL-GST

Moms Cradle Pvt Ltd Vs UoI

GST - Petitioner is aggrieved by the inaction on the part of the respondents in not releasing the IGST and amount of duty drawbacks due to them - Bench, therefore, directs the respondent authorities concerned to decide the question of release or otherwise of IGST along with interest as well as the release or otherwise of duty drawback due to the petitioner in accordance with law, rules, regulations and Government policies applicable to the facts of the case, as early as possible and preferably within a period of three weeks - petitioner shall thereafter be at liberty to challenge the order passed by the respondents, if so advised, along with the other grievances raised in this writ petition - Petition disposed of: High Court [para 4 to 6]

- Petition disposed of: DELHI HIGH COURT

2020-TIOL-1371-HC-DEL-GST

Gaurav Yadav Vs UoI

GST - Petitioner has filed a Public Interest Litigation being aggrieved by the fact that there was no extension by the respondents of including masks and sanitizers in the list of "Essential Commodities" under the Essential Commodities Act, 1955 and also regulation in the price of masks and sanitizers after 30 th June 2020 – Also, the petitioner has also sought for reduction in GST rate applicable on alcohol based sanitizers from 18% to either 5% or 12%.

Held:

+ None of the prayers can be granted by this Court for the following reasons viz. (a) What items are to be included under the Essential Commodities Act, 1955 as "Essential Commodity", is a policy decision of the respondent/Government and, therefore, unless the decision can be shown to be manifestly unreasonable or arbitrary, this Court will be extremely slow in interfering with the policy decision of the Government; (b) Inclusion of commodities in the list of "Essential Commodities" under the Essential Commodities Act, 1955 is a complex decision based upon varieties of factors such as availability, price etc. -Moreover, the aforesaid notification dated 13th March, 2020 has not been extended beyond 30th June, 2020 as, in the opinion of the Government, masks and sanitizers are now easily available and there is no need to control such commodities or to regulate supply etc. of these commodities. Thus, a conscious decision has been taken by the respondents not to extend the notification dated 13th March, 2020 beyond 30th June, 2020 as, in the opinion of the Government, based upon the facts, there is no need to control the price of the masks and sanitizers, as per the Office Memorandum dated 1st July, 2020; (c) The petitioners have not brought any material on record to demonstrate that the basis for the decision of the respondents is erroneous in any manner; (d) Even during the period of coverage of masks and sanitisers under the Act, the only regulation in place was about the price of the aforesaid two commodities as is clear from the notification dated 21st March, 2020: High Court [para 4]

+ Insofar as the other prayer, which relates to reduction of rate of GST on sanitizers, it ought to be kept in mind that the rate of tax cannot be challenged in a Court of law unless it is abundantly confiscatory in nature - In the facts of the present case, nothing has been argued out about how the present rate of GST is confiscatory in law - Merely because this petitioner feels that the GST rate applied on sanitizers is excessive, this cannot be a reason for issuing a writ of mandamus and direct the respondents to reduce tax on the said commodity. [para 6]

- Petition dismissed: DELHI HIGH COURT

2020-TIOL-1370-HC-DEL-GST

AAR Impex Vs UoI

GST - Petitioner is aggrieved by the inaction on the part of the respondents in not releasing the IGST and amount of duty drawbacks due to them – Bench, therefore, directs the respondent authorities concerned to decide the question of release or otherwise of IGST along with interest as well as the release or otherwise of duty drawback due to the petitioner in accordance with law, rules, regulations and Government policies applicable to the facts of the case, as early as possible and preferably within a period of three weeks - petitioner shall thereafter be at liberty to challenge the order passed by the respondents, if so advised, along with the other grievances raised in this writ petition – Petition disposed of: High Court [para 4 to 6]

- Petition disposed of: DELHI HIGH COURT

2020-TIOL-1364-HC-MAD-GST

Amplexor India Pvt Ltd Vs UoI

GST - Constitutional validity of the retrospective amendment to s.140 of the CGST Act, 2017 and Rule 117 of the CGST Rules are under challenge - Bench had in its earlier judgment in P.R.Mani Electronics - 2020-TIOL-1198-HC-MAD-GST upheld the validity of Rule 117 of the CGST Rules, 2017- Petitioner sought to distinguish the said judgment by contending that availment of ITC should be distinguished from the transition and utilisation of the ITC; that once an assessee avails ITC by complying with all the conditions relating thereto, a vested right accrues in favour of such assessee and such vested right of ITC cannot be divested by a subsequent enactment; that section 174(2)(c) of the Act protects vested rights; that the CENVAT credit can be taken away only when it was wrongly availed by invoking rule 14 of CCR; that the objects and reasons of the CGST Act are adverted to in order to contend that the primary object was to prevent cascading of taxes and that the relevant provisions viz. section 140 of the CGST Act and rule 117 of the Rules should be interpreted by keeping in mind the said object and purpose - Bench, therefore, is of the opinion that the following questions arise for consideration viz. Whether ITC is a vested right and, therefore, whether the imposition of time limit for transitioning or utilisation thereof is constitutionally impermissible; Whether the time limit imposed in rule 117 of the CGST Rules is mandatory or directory; Whether section 140 of the Act read with rule 117 of the Rules divests the assessee of an alleged vested right or whether it prescribes conditions relating to the enforcement of such right; Whether the assessee has a legitimate expectation that the ITC availed under the erstwhile tax regime should be permitted to be transitioned to the new tax regime without imposing a time limit and Whether the deprivation of the benefit of ITC would amount to double taxation of the assessee - Notice issued - Matter to be listed on 18.09.2020: High Court [para 6]

- Matter listed: MADRAS HIGH COURT

JC Industries Vs State Of Karnataka

In writ, the High Court observes that the re-assessment order being assailed, was quashed by the Commr.(A), who also directed re-doing of the assessment. Hence the court directs that no coercive action be taken against the assessee till the assessment is re-done.

- Writ petition disposed of: KARNATAKA HIGH COURT

SERVICE TAX

2020-TIOL-1369-HC-DEL-ST

Seventh Plane Networks Pvt Ltd Vs UoI

ST - SVLDRS, 2019 - Petition has been filed challenging the rejection order dated 17th January, 2020 whereby the declaration filed by the petitioner under Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 has been rejected on the ground that the audit was conducted and conveyed on 02nd July, 2019 and amount of duty involved in the audit had not been quantified on or before the 30th day of June, 2019 - Petitioner submits that though the respondent No.4 issued audit memo in writing on 02nd July, 2019, yet the petitioner had accepted the demand on disputed points on 28th June, 2019 - Petitioner relies on para 2(v) of Circular No. 1074/07/2019-CX dated 12th December, 2019 and paras 4(a) and 10(g) of Circular dated 27th August, 2019 to emphasise that as the petitioner had admitted its liability on 28th June, 2019 itself, the demands stood quantified - furthermore, the impugned order is in violation of principles of natural justice inasmuch as respondents had neither issued any notice nor given any opportunity of hearing to the petitioner.

Held: Court finds that the expression "quantified" in Section 121(r) has been extended/widened by way of para 2(v) of Circular dated 12th December, 2019 and paras 4(a) and 10(g) of Circular dated 27th August, 2019 - It is settled by the apex court that circulars are binding on the department and department cannot challenge them even if they are inconsistent with the statute - Court also finds that the audit in the present case was concluded on 28th June, 2019 and the amount due and payable was not only determined as well as communicated by the respondents to the petitioner but was also admitted by the petitioner - Court finds that the duty amount mentioned in Form SVLDRS-1 by the petitioner is the same amount that had been admitted by the declarant during the last visit of the Audit Team on 28th June, 2019 as mentioned in the respondents' Audit Memo dated 2nd July, 2019 - Court is of the view that the duty liability stood admitted in an oral statement by the petitioner before 30th June, 2019 and consequently stood quantified prior to the cut-off date in accordance with the beneficial circulars dated 12th December, 2019 and 27th August, 2019 issued by the Central Board of Indirect Taxes and Customs - a liberal interpretation has to be given to the SVLDRS, 2019 and the circulars issued by Central Board of Indirect Taxes and Customs as their intent is to unload the baggage relating to legacy disputes under the Central Excise and Service Tax and to allow the businesses to make a fresh beginning - rejection order dated 17th January, 2020 is quashed and the Designated Committee is directed to decide the petitioner's application in accordance with the observations and findings of this Court after giving an opportunity of hearing to the petitioner - Matter to be heard by the Designated Committee on 03rd September, 2020 at 11:00 A.M and a reasoned order is required to be passed on or before 21st September, 2020 - Writ petition disposed of: High Court [para 11 to 15, 18, 19, 20]

- Petition disposed of : DELHI HIGH COURT

2020-TIOL-1223-CESTAT-DEL

Host Books Ltd Vs CCGST

ST - The assessee-company is a 100% EoU engaged in exporting services classifiable under Management/Business Consultancy Services, to customers located outside India - During the relevant period, the assessee claimed refund of accumulated CENVAT credit u/r 5 of CCR 2004 - The adjudicating authority found the refund claim to be admissible in principal - The assessee filed the present appeal, claiming there to be an error in the formula whole calculating amount of total turnover - On appeal, the Commr.(A) upheld the calculations done by the adjudicating authority.

Held - The formula for calculating the amount of total turnover, has been misconceived in the impugned order, by taking the billing amount of export of services as the amount of total turnover or gross turnover for calculation of refund - Evidently, the formula given is for calculation of proportionate refund, where an assessee has got export turnover in part and domestic turnover in part, which is not the fact in the present case - As the assessee exported 100% of its services, the assessee is entitled for refund of an amount higher than what was earlier allowed & disbursed - The adjudicating authority is directed to refund the balance amount within 30 days of receipt of this order: CESTAT

- Assessee's appeal allowed: DELHI CESTAT

2020-TIOL-1222-CESTAT-BANG

Syndicate Bank Vs CCE

ST - Whereas the show-cause notice is issued for disallowance of credit for contravening of the provisions of Rule 9 of CENVAT Credit Rules, 2004, the Commissioner proceeds to deny the credit on co-relation between input service and output service, therefore, the impugned order is not legally sustainable as impugned order travelled beyond the scope of show-cause notice - nonetheless, in view of the judgments in the case of Millipore India Pvt. Ltd. and Toyota Kirloskar Motor Pvt. Ltd., - 2011-TIOL-941-HC-KAR-ST , the input services claimed by the appellants are admissible for credit for rendering output services - Bench has no hesitation in holding that the services which are utilized by the appellants have nexus with the output services provided by them, therefore, credit is admissible - Appeal allowed with consequential relief: CESTAT [para 9, 10]

- Appeal allowed: BANGALORE CESTAT

2020-TIOL-1221-CESTAT-BANG

Abhiman Constructions Vs CCE & ST

ST - Appellant is engaged in construction of commercial and residential complexes - The immovable property transferred by the appellants to the ultimate customers on the completion of the work pertains to period 2005-06 and 2006-07 - Understandably, such transfer also included the cost of the land, therefore, the appellant's case is squarely covered by the decision of Tribunal in the case of Krishna Homes - 2014-TIOL-402-CESTAT-DEL following Apex Court's judgment in the case of Larsen and Toubro - 2015-TIOL-187-SC-ST - activity undertaken being in the nature of Works Contract is not taxable before 01/07/2010 – Appeals are allowed: CESTAT [para 4, 5]

- Appeals allowed: BANGALORE CESTAT

CENTRAL EXCISE

2020-TIOL-1225-CESTAT-HYD

Biomax Life Sciences Ltd Vs CC, CE & ST

CX - The assessee manufactures Aloe Vera Juice and Aloe vera powder from Aloe vera plant and Amla juice and Amla powder from amla fruit - Initially they classified their products under Chapter 6 of Central Excise Tariff - A SCN was issued to them under Section 11A invoking extended period of limitation proposing to reject the classification of products under Chapter 6 of Central Excise Tariff and instead proposing to classify them under Chapter 13 and accordingly demanded differential duty along with interest - It was also proposed to impose a penalty equal to the differential duty upon assessee - Coming to the first question of classification, there is no dispute that the original classification by assessee under Chapter 6 was not correct and the dispute now is between Chapter 13 and Chapter 20 - A plain reading of Chapter heading 1302 shows that this covers the vegetable saps and extracts, pectic substances and spectators agar agar and other mucilages and thickeners, whether or not modified, derived from vegetable products - Evidently, this chapter covers products which are either in liquid form or otherwise - There cannot be any dispute that both amla and aloevera are plants and the juices and powders which are extracted from them can therefore be clearly covered under Chapter Heading 1302 - On the other hand, Chapter Notes to Chapter 20 also do not exclude any products which may fall under Chapter 13 - Chapter Heading 2009 clearly covers fruit juices and vegetable juices, unfermented and not containing added spirit whether or not containing added sugar or sweetening matter - Therefore, it is equally logical to classify the aloe vera juice and amla juice under Chapter Heading 2009 as claimed by assessee - However, no ground found to call the powders manufactured by assessee as juices as powder is a solid and the juice is a liquid - There is nothing in the description of Chapter Heading 2009 to suggest that it also includes powders - Therefore, the aloe vera powder and amla powder manufactured by assessee cannot be classified under Chapter Heading 2009 - As far as the aloe vera juice and amla juice are concerned, both chapter heading 1302 and Chapter Heading 2009 equally merit consideration and therefore Chapter Heading 2009 being the last in the numerical order prevails in terms of General Rules of Interpretation Rule 3(c) - Therefore, aloe vera juice and amla juice are classifiable under CETH 2009 as claimed by assessee - The demand on aloe vera juice and amla juice for the entire period is to be calculated reckoning their classification under Chapter 20 and the demand of duty for aloe vera powder and amla powder needs to be upheld - As far as the question of limitation is concerned, it is evident from the order of adjudicating authority that the only ground on which the extended period of limitation has been invoked and upheld in this case is that the assessee has wrongly classified the products in their ER-1 returns and paid less duty - Claiming wrong classification cannot be the ground for invoking extended period of limitation, therefore, the entire demand beyond normal period of limitation is set aside - Assessee has pleaded that cum duty benefit and also credit on inputs if any applicable be given to them - The duty therefore needs to be calculated accordingly - As far as the interest is concerned, once the duty is payable to some extent, interest on that amount has to be paid as per law and this is not a matter of discretion - As far as the penalties imposed upon the assessee are concerned, no penalty can be imposed under Section 11AC as there is no element of fraud, collusion wilful misstatement or suppression of facts or violation of the provisions of the Act or Rules with an intent to evade payment of duty - No penalty is imposable upon assessee under Rule 25 also as the assessee has not violated any Rules and it is only a matter of difference of opinion regarding classification by assessee and by the department - Therefore, all penalties are set aside: CESTAT

- Appeals disposed of: HYDERABAD CESTAT

2020-TIOL-1224-CESTAT-AHM

Koshambh Multitred Pvt Ltd Vs CCE & ST

CX - On 18.11.2004, appellant filed refund claim of Rs.21,96,532/- in respect of the credit lying with them in respect of goods exported from their job workers premises directly in terms of Rule 5 of CCR, 2004 - In the first round of litigation, the Tribunal settled the subject of dispute by holding that the appellant are entitled to file refund claim with their own jurisdictional authorities - Incidentally, during this period, the appellant had utilized a large part of the credit and the credit reduced from Rs.21,96,532/- to Rs.6,28,694/- - The appellant, therefore, claimed that they are entitled to refund of the said balance amount of Rs.6,12,694/- as that arises on account of export of goods and is covered under Rule 5 of Cenvat Credit Rules, 2004, however, the same was rejected for the sole reason that the appellant have utilised a substantial part of the credit while the matter was in dispute and, therfore, they might have further utilized the credit and may have reduced the same to nil - appeal to CESTAT

Held: Commissioner(A) has observed that as the appellant failed to block the said credit and the same was continuously utilized by them, the Condition No. 5 of the Appendix prohibiting the refund in such situation would debar them from such refund claim - refund has been rejected arbitrarily and on presumption-assumption basis - The appellant had filed refund claim in the year 2004 and matter was under litigation for long time and it is almost for 16 years now - It would be wrong to expect the assessee to hold on to credit for such a long period - The condition 5 of the Notification No. 11/2002-CE (NT) does not mean that the appellant should not be able to utilize the credit at all - It is to be read harmoniously to mean that the refund should be allowed to the manufacturer if they are not in a position to utilize the Cenvat credit within a reasonable period - impugned order is set aside and appeal is allowed with consequential relief: CESTAT [para4, 5]

- Appeal allowed: AHMEDABAD CESTAT

CUSTOMS

2020-TIOL-1353-HC-DEL-CUS

Aadharshil Mobility Solutions Pvt Ltd Vs UoI

Cus - The assessee imported Wireless Communication Module classifiable under the Customs Tariff Heading No.85177090 - The present writ was filed seeking that directions be issued to the Customs authorities concerned to grant Equipment Type Approval as was sought for by the assessee - The assessee also sought that the consignment imported by it and which had been detained by the Department, be released without insisting on ETA as was the consistent practice for the preceding several years, in respect of identical products imported from the same seller.

Held - The counsel for the Revenue stated that the approval had been issued - As the main grievance pertaining to the Equipment Type Approval is settled, the Revenue authorities concerned are directed to release the consignment within one week's time: HC

- Writ petition disposed of: DELHI HIGH COURT

2020-TIOL-1220-CESTAT-ALL

CC Vs VSM Impex Pvt Ltd

Cus - Declared transaction value was enhanced by the Original Adjudicating Authority primarily based upon the Alerts Circular issued by Directorate General of Valuation (DGoV) – Commissioner(A), by taking note of various precedent decisions of the higher Authorities held that in the absence of any evidence produced by the Revenue, enhancement cannot be done – Aggrieved, Revenue is in appeal.

Held: Tribunal in the case of M/s Sanjivani Non-Ferrous Trading Pvt. Ltd. - 2017-TIOL-3396-CESTAT-ALL held that the Valuation Alerts Circular issued by Directorate General of Valuation (DGoV) have no authority and cannot be adopted for enhancement in terms of Section 14 of the Customs Act, 1962 – This order has been upheld by the Supreme Court when the appeal filed by the Revenue was rejected - 2018-TIOL-447-SC-CUS – It, therefore, stands settled that the Valuation Alerts Circular issued by Directorate General of Valuation (DGoV) have no legal value and cannot be adopted for the purpose of enhancement of assessable value of the imported goods - No reason to interfere in the impugned orders of Commissioner (Appeals), hence appeals are rejected: CESTAT [para 4]

- Appeals rejected: ALLAHABAD CESTAT