2020-TIOL-1399-HC-DEL-GST

GSTN Vs Information Commissioner CIC

GST - RTI Act, 2005 - Writ petition is filed by the petitioner GSTN seeking an appropriate writ of certiorari for quashing order dated 13.10.2016 passed by respondent No.1/Information Commissioner, CIC - Facts are that the Respondent No. 2 filed an RTI application addressed to CPIO of the petitioner Company on 16.08.2014 seeking the following information viz. A. Number of Meetings of GSTN's Board of Directors held from 28.03.2013 till date along with the date of each meeting. B. Date on which the AGM of GSTN has been held in the year 2013 and 2014. C. Copies of Minutes of all the Board meetings as referred above along with minutes of the AGM. D. Total no. of Resolutions passed by the GSTN's Board of Directors from 28.03.2013 till date, along with the date of each resolution and E. Copies of the Resolutions as referred to above. - CPIO on 17.09.2014 provided information to respondent No. 2 for points A and B above - For points C to E, the said information was in relation to the minutes of the meetings of the Board of Directors which was confidential and hence, could not be made open to the public at large, the CPIO held by treating information sought by respondent No. 2 as above is exempt from disclosure under Section 8(1) (d) and Section 8(1) (j) of the RTI Act, 2005 - Appeal against this order was rejected and hence respondent filed appeal with CIC and by the impugned order dated 13.10.2016, respondent No. 1 has directed the petitioner to provide copies of the minutes of the board meetings as well as the resolutions for the period 01.04.2013 to 31.12.2015 after severance of the record containing information which is exempted from disclosure under the RTI Act - Needful was to be done within four weeks and hence, this writ petition by GSTN.

Held: A perusal of the reply given by the CPIO dated 17.09.2014 to respondent No. 2's application shows that there were in all 10 Board Meetings that had been held - In the facts of this case, it would be for the CIC to go into the minutes of the Board Meetings and of the AGMs and to determine as to which of the information which is contained in the minutes attracts the provision of Section 8(1)(d) of the Act, namely, are exempt from disclosure and which portion of the minutes can be given to respondent No. 2 in response to his application under the RTI Act - The CIC while looking at the aforesaid matter afresh may keep into account the above observations of the Supreme Court [in Subhash Chandra Agarwal, 2019 SCC OnLine SC 1459 ] to determine as to whether the demand of respondent No. 2 for minutes of all the Board Meetings for the stated period would fall in the category of being counterproductive and a misuse/abuse of the RTI Act that was frowned upon by the Supreme Court - It was observed therein that the CIC left the whole thing at the discretion of the petitioner which was held not to be the correct approach - impugned order is contrary to the legal position and is set aside - The matter is remanded back to the CIC for fresh consideration as above - Petition disposed of: High Court [para 20 to 22]

- Matter remanded: DELHI HIGH COURT

2020-TIOL-1398-HC-MP-GST

Vijay Kumar Nair Vs State Of MP

GST - Application filed under section 439 of the Cr.P.C. in crime no.23/2020 registered under section 132(1)(a)(i) of the CGST Act, 2017 - Petitioner claimed parity with co-accused -Amit Bothra and Ashok Daga, who have been granted bail by this Court vide order dated 27.07.2020 passed in M.Cr.C. Nos.21628/2020 and 21618/2020 respectively – Petitioner asserts that case of the petitioner is on better footing than the case of co-accused - Amit Bothra and Ashok Daga, because all the allegations of the department of tax evasion are against their firm M/s Vishnu Essence, while the petitioner is neither a partner nor in any other way concerned or connected with the firm; that he is only a trader, supplier or commission agent of the firm Vishnu Essence; that there is no allegation of the department that he clandestinely removed or transported Pan Masala.

Held: On due consideration of the allegation against the petitioner, evidence produced before the court to show his involvement, the act attributed to him, the part played by him in the alleged tax evasion, parity of his case with the case of the co-accursed persons who have been granted bail and other facts and circumstances of the case, Bench deems it appropriate to allow the application - Therefore, without commenting on the merits of the case, the petition is allowed on the same terms, as is allowed in the case of co-accused Amit Bothra and Ashok Daga: High Court [para 10]

- Application allowed: MADHYA PRADESH HIGH COURT

2020-TIOL-1396-HC-DEL-GST

Gulati Enterprises Vs CBIC

GST - Petition has been filed challenging the show cause notice dated 21st May, 2020 as well as for a direction to the respondents not to proceed with the adjudication proceedings until Rule 142(1A) of the CGST Rules is complied with - Petitioner states that the impugned show cause notice has been issued without communicating the details of tax, interest and penalty in Part A of FORM GST DRC-01A prior in time in accordance with Rule 142(1A) of the CGST Rules.

Held: Cunter affidavit to be filed by Revenue within a period of four weeks and rejoinder affidavit, if any, to be filed before the next date of hearing - Matter listed on 4 th November 2020: High Court

- Matter listed: DELHI HIGH COURT

2020-TIOL-1397-HC-DEL-GST

Global Enterprises Vs CCGST

GST - Petition has been filed challenging the orders dated 19th May, 2020 and 10th July, 2020 passed by the Commissioner, Central Goods and Service Tax Delhi East whereby the petitioner's bank account in Axis Bank Ltd. has been attached - Petitioner also prays for de-freezing of its bank account forthwith - Petitioner relies upon a judgment of the Gujarat High Court in M/s Patran Steel Rolling Mill vs. Assistant Commissioner of Sale Tax, - 22018-TIOL-2937-HC-AHM-GST , wherein it has been held that in accordance with Section 83(1) of Central Goods and Services Tax Act, the Commissioner must record the reasons in writing to the effect that the petitioner would not be in a position to pay taxes after assessment proceedings are over before attaching any bank account or taking any such drastic action; that attachment of the petitioner's bank account amounts to closure of its business.

Held: Issue Notice - Counter-affidavits to be filed by Revenue within a period of two weeks and rejoinder-affidavits, if any, be filed before the next date of hearing - Matter to be listed on 21st September 2020: High Court

- Matter listed: DELHI HIGH COURT

2020-TIOL-1395-HC-MP-GST

Jagdish Arora Vs UoI

GST - Bail application filed u/s 439 of the CrPC on behalf of applicants Jagdish Arora and Ajay Kumar Arora who have been taken into judicial custody in connection with Crime no. DGGI/BhZU/1204/03/2020-21/SDPL in respect of the offence punishable u/s 132(1)(a) r/w s.132(1)(i) of the CGST Act - Instant case arises out of proceedings initiated by the GST department in relation to the purported evasion of GST by the company - Som Distilleries Pvt. Ltd. [SDPL] purportedly leviable and evaded on account of production and sale of sanitisers - Petitioners claim that they are neither Directors/Managers/Officers/employees or authorised representatives of the SDPL and as such, they are not responsible for the day-to-day business affairs of the company; that both the applicants had resigned their Directorship from SDPL on 01.04.2009 i.e. nearly 11 years ago; that the department has not collected or placed on record even an iota of documentary evidence in order to substantiate their version; that the applicants are entitled to bail on this ground alone.

Held: Bench has gone through the record in order to ascertain the existence of ‘reasons to believe' for the proceedings being initiated against the applicants - Bench does not perceive any material, except the statement of the employee - Binay Kumar Singh; that there is no documentary material produced on record to show that the present applicants were legally in-charge and responsible for the day-to-day working of the company; that they had already resigned from the Directorship of the company and merely on a bald statement of an employee of the company, it cannot be held that the present applicants were in-charge and responsible for the functions of the company - without commenting on the merits of the case, the application for grant of bail to the applicants stands allowed - It is directed that the applicants be released from custody on their furnishing a personal bond in the sum of Rs.5 lakhs each, with separate sureties of like sum to the satisfaction of the trial Court, for their appearance before it, as and when required and subject to the conditions laid down - Original records of the case to be returned to the respondent in a sealed cover: High Court [para 38, 40]

- Applications allowed: MADHYA PRADESH HIGH COURT

2020-TIOL-1394-HC-KERALA-GST

Pee Bee Enterprises Vs Assistant Commissioner

GST - It is the case of the petitioner that the assessments pertaining to the months April and May 2019 were completed u/s 62 of the SGST Act on best judgment basis, taking note of the non filing of returns by the petitioner assessee for the said month - While the assessment orders are dated 20.8.2019, it is the case of the petitioner that these orders were not served on him till much later and within 30 days after the from the date of receipt of the orders, he filed the returns as permitted under Section 62 of the SGST Act - Petitioner, therefore, contends that the assessment orders have to be treated as withdrawn by virtue of the provisions of Section 62 of the Act.

Held: From a reading of the statement of the respondent, it is found that the assessment orders dated 20.8.2019 were served on the petitioner through publication on the web portal on 20.8.2019 itself - Over and above that, an email was also sent to the petitioner at his registered email id, although the petitioner says that he did not receive the email but received only a copy of the same through registered post much later - Bench notes that the service of an order through the web portal is one of the methods of service statutorily prescribed under Section 169(1)(c) and (d) of the SGST Act and if that be so, then the petitioner cannot deny the fact of receipt of the order on 28.9.2019 for the purposes of filing the returns as contemplated under Section 62 of the SGST Act with a view to getting the assessment order withdrawn - Inasmuch as the return filed by the petitioner for the period April and May 2019 was only on 30.10.2019 i.e. 71 days after the date of service of the assessment order through the web portal (20.8.2019), the petitioner cannot aspire to get the benefit of withdrawal of the assessment orders contemplated u/s 62 of the SGST Act - The assessment orders would, therefore, have to be held valid and the remedy of the petitioner against the said assessment order can only be through an appeal before the appellate authority under the Act - Taking note of the submission of the petitioner that he would require some time to move the appellate authority, Bench directs that the recovery steps for recovery of amounts confirmed against the petitioner by Exts.P1 and P2 assessment orders and Exts. P8 and P9 demand notices shall be kept in abeyance for a period of one month so as to enable the petitioner to move the appellate authority in the meanwhile and obtain orders of stay in the stay application filed along with the appeal - If the petitioner files the appeal within a period of two weeks from the date of receipt of a copy of this judgment, then the appellate authority shall treat the appeals as filed within time, and proceed to consider the stay applications preferred by the petitioner on merits after hearing the petitioner: High Court

- Petition disposed of: KERALA HIGH COURT

2020-TIOL-1393-HC-MP-GST

Kishore Wadhwani Vs State Of Madhya Pradesh

GST - Application filed under section 439 of the Cr.P.C. in crime no.23/2020 registered under section 132(1)(a) (i) of the CGST Act, 2017 - petitioner began with the arguments that the only fault of the petitioner is that he is the landlord of the premises where his tenant, who runs a factory, allegedly evaded the tax by clandestine sale of Pan Masala; that the petitioner is neither a Partner of his tenant M/s Vishnu Essence nor in any other way concerned with it; that he has been posed as if he is the only responsible person for whatever has allegedly been done against the law by his tenant, while no document, what-so-ever it may be, has been produced by the department to show his involvement in the alleged tax evasion - Pendency of investigation is also taken as a ground for dismissing the petition, which is countered on the ground that no further custodial interrogation is requested by the department and the respondent is bound to file the chargesheet within 60 days of the arrest of the petitioner and as per date of arrest i.e. 13.06.2020 sixty days have been completed on 12.08.2020; that if still the charge-sheet is not filed, the petitioner is entitled for default bail under Section 167 of the Cr.P.C.

Held: Elaborate discussion of all the evidence, which is otherwise confidential, would not be appropriate as it may affect the case of either party - But on careful consideration of the evidence on record, Bench is of the considered opinion that it would be appropriate to allow the petition, therefore, without commenting on merits of the case, the petition is allowed - Petitioner Kishore Wadhwani S/o Shri Khanchand Wadhwani is directed to be released from custody on his furnishing a personal bond in the sum of Rs.10,00,000/- with one solvent surety to the satisfaction of the Trial Court for his appearance before it as and when required further subject to the conditions laid down: High Court [para 10, 11]

2020-TIOL-1392-HC-MP-GST

Nitesh Wadhwani Vs State Of Madhya Pradesh

GST - Application is filed under section 438 of the Cr.P.C. seeking anticipatory bail in crime no.23/2020 registered under section 132(1)(a)(i) of the Goods and Services Tax Act GST - petitioner began with the arguments that the only fault of the petitioner is that he is the landlord of the premises where his tenant, who runs a factory, allegedly evaded the tax by clandestine sale of Pan Masala; that the petitioner is neither a Partner of his tenant M/s Vishnu Essence nor in any other way concerned with it; that he has been posed as if he is the only responsible person for whatever has allegedly been done against the law by his tenant, while no document has been produced by the department to show his involvement in the alleged tax evasion - Pendency of investigation is also taken as a ground to press for dismissal of the petition, which is countered on the ground that the department has already completed custodial interrogation of Kishore Wadhwani, who is real uncle of the petitioner and is impleaded for the same charge on the basis of the same set of evidence, therefore, no further custodial interrogation of the petitioner as requested by the department is necessary - It is further submitted that the officials of the department have harassed the co-accused persons and have recorded their statements to suit their whims under threat, coercion and duress - The petitioner have all reasonable apprehension that in case of his arrest, he will be treated in the same fashion and may be forced to signed the statements against his wish under the threat and undue pressure of the officials - It is explained that when the officers came to his house, the petitioner or any other male member was not at home and the officials of the department were trying to enter the house forcibly without disclosing their identity; that when they were asked to show the same, they misbehaved with the women of the house and hence faced rebuttal from the family - It is further alleged that the FIR has been lodged only to pressurize the petitioner and now it cannot be used as a tool to oppose his prayer for bail - It is impressed by Revenue counsel that this Court does not possess the power to grant anticipatory bail as the provisions of Section 438 Cr.P.C. are not applicable in cases registered under the GST Act; cases have been cited in this regard viz. Union of India V. Sapna Jain & Ors. = 2019-TIOL-217-SC-GST , P.V. Ramanna Reddy & Ors. Vs. Union of India = 2019-TIOL-873-HC-TELANGANA-GST , Union of India Vs. Padam Narain Aggarwal = 2008-TIOL-187-SC-CUS .

Held: It emerges from most of the judgments on the issue of granting anticipatory bail cited by the respondent that the Courts have held that the facts of a particular case are the paramount consideration for granting or refusing the protection of a pre-arrest bail - It is nowhere stated that the anticipatory bail is barred by law or cannot be granted in a case registered under the GST Act - Elaborate discussion of evidence, which is otherwise confidential, would not be appropriate as it may affect the case of either party but on careful consideration of the evidence on record, Bench is of the considered opinion that it would be appropriate to allow the petition, therefore, without commenting on merits of the case, the petition is allowed - Bail application is allowed and it is directed that in the event of the petitioner's arrest or surrender before the police within a month of this order, the petitioner Nitesh Wadhwani S/o Late Shri Ashok Wadhwani shall be released on bail on his furnishing a personal bond of Rs.10,00,000/- with one solvent surety of the like amount to the satisfaction of Station House Officer of the Police Station concerned - The petitioner would abide by the conditions mentioned in Section 438 (2) Cr.P.C and subject to conditions as laid down: High Court [para 15, 17, 18]

2020-TIOL-1391-HC-MAD-GST

Revenue Bar Association Vs UoI

GST - Petition is filed for issue of writ of declaration to declare the Goods and Services Tax Appellate Tribunal (Appointment and Conditions of Service of President and Members) Rules, 2019 framed vide notification dated 21st August 2019 as void, defective and unconstitutional being violative of Articles 21 and 50 of the Constitution of India and the doctrine of separation of powers and independency of judiciary and also contrary to the principles laid down by the Supreme Court in UOI vs. R.Gandhi - 2010-TIOL-39-SC-MISC - Counsel for respondent UOI informed the Bench that the matter is still under active consideration and the GST council has not been able to meet in order to finalise the qualifications, tenure and selection procedure as well as other conditions relating to the constitution of Tribunal; that the matter has to be revisited in terms of the judgment in the case of Roger Mathew vs. South Indian Bank Ltd. Bench notes that based on the request made on behalf of the UOI on 08.01.2020 the Bench had adjourned the matter twice to enable the Counsel for Revenue to inform the Court about any developments in the matter - Counsel informs the Bench that the meeting of the GST Council has not yet ben convened and, therefore, the matter may be adjourned and listed after two months - Bench finds that the petition was entertained in October 2019 and an interim order had been passed on 03.10.2019 and since the matter continues to be adjourned on account of the respondent, the matter is directed to be listed after two months - interim order dated 03.10.2019 to continue till further orders - Matter to be listed on 28.10.2020: High Court [para 7]

- Matter listed : MADRAS HIGH COURT

2020-TIOL-223-AAR-GST

Habitat Technology Group

GST - "Rebuild Kerala" Project - Activity undertaken by the applicant for Sri Sathya Sai Trust as per the agreement dated 16.11.2019 cannot by any stretch of imagination be construed as construction of affordable residential apartments by a promoter in a residential real estate project intended for sale to a buyer and hence the rate of GST prescribed under SI No. 3 (i) of the Notification No. 11/2017 Central Tax (Rate) as amended by Notification No. 03/2019 Central Tax (Rate) dated 29.03.2019 is not applicable in respect of the activity - The activity undertaken by the applicant is construction of 45 individual residential houses at different locations on the land belonging to the individual beneficiaries and the activity squarely falls within the scope of works contract as defined in Section 2 (119) of the CGST Act, 2017 - Services provided by the applicant to Sri Sathya Sai Trust for construction of low cost housing units falls within the ambit of Sl No. 3 (v) of Notification No. 11/2017- Central Tax (Rate) and is liable to GST at the rate of 12% [6% CGST and 6% SGST]: AAR

- Application disposed of: AAR

2020-TIOL-222-AAR-GST

Ray Constructions Ltd

GST - Applicant has received a work order from Vikram Sarabhai Space Centre for the construction of a building for space transportation system; same is a composite contract which includes supply of materials as well as service - They have also received another work order from Mis. Infrastructure Kerala Ltd, a Public Private Partnership Company promoted by Government of Kerala, for the development of Medical College, Thiruvananthapuram which includes construction of road, bridges and other infrastructure - The applicant has requested for advance ruling on the rate of tax applicable for the above works contracts awarded by the Government authorities.

Held: Services provided by the applicant under both the contracts being composite supply of works contract as defined in clause (119) of Section 2 of the CGST Act, 2017 provided to the Central Government and State Government by way of construction, erection, commissioning or installation of a civil structure or any other original works meant predominantly for use other than for commerce, industry or any other business or profession is covered under entry at Sl No. 3 (vi) (a) of Notification No. 11/2017 Central Tax (Rate) and attracts GST at the rate of 12% [6% CGST and 6% SGST]: AAR

- Application disposed of: AAR

2020-TIOL-221-AAR-GST

George Jacob

GST - Activity of renting / leasing the water channel by the Grama Panchayat to the applicant for fish farming for a consideration determined through auction is squarely covered under the exemption entry at Sl No. 54 of Notification No. 12/2017 Central Tax (Rate) as services relating to ‘rearing of all life forms of animals by way of renting or leasing of vacant land': AAR

Application disposed of: AAR

2020-TIOL-220-AAR-GST

Eco Wood Pvt Ltd

GST - Manufacture of PVC Tufted Coir Mats / Mattings / Floor coverings by the process of embedding coir yarn into PVC cannot be considered as textile floor coverings of coir covered under HSN 5702, 5703 or 5705 - The process undertaken is a tufting process and, if any, PVC or rubber or any other materials are tufted on the textile of coir, which is used as floor mats or mattings, it will come under the Customs Tariff Head 5703 90 90 and is liable to GST at the rate of 12% as per Entry at Sl No. 144 Schedule II of Notification No. 01/2017 Central Tax (Rate) : AAR

PVC Tufted Coir Mats and Matting cannot be considered as coir mats, mattings and floor coverings covered under HSN 5702 or 5705 and is appropriately classifiable under HSN 5703 90 90 as tufted mats / matting / floor coverings of coir: AAR

PVC Tufted Coir mats/ mattings / floor coverings are classifiable under Customs Tariff Heading 5703 90 90 and attracts GST at the rate of 12% as per Sl No. 144 of Schedule II of Notification No. 01/2017 Central Tax (Rate) : AAR

- Application disposed of: AAR

2020-TIOL-219-AAR-GST

Dynamic Techno Medicals Pvt Ltd

GST - Cast protector cannot be considered as a pharmaceutical product - It is a reusable water proof plastic covering that keep the casts / wounds dry while coming to contact with water - Hence it comes under the classification HSN 3926 90 99 'Other articles of plastics and articles of other materials of headings 3901 to 3914 -Other' and not under HSN tariff item 9021.10.00 as a fracture appliance: AAR

- Application disposed of: AAR

2020-TIOL-45-NAA-GST

Director General Of Anti-Profiteering Vs Harish Bakers And Confectioners Pvt Ltd

GST - Anti-Profiteering - S.171 of the CGST Act, 2017 - DGAP had in its report stated that the Respondent had denied the benefit of GST rate reduction to his customers amounting to Rs. 15,958/- pertaining to the period w.e.f. 15.11.2017 to 31.03.2018 and had thus indulged in profiteering and violation of the provisions of Section 171 (1) of the above Act - Authority had accepted this report and determined the profiteered amount as Rs.15,958/- [2018-TIOL-16-NAA-GST] - Respondent was issued notice dated 01.01.2019 asking him to explain why the penalty mentioned in Section 122(1) read with Rule 133 (3) (d) should not be imposed on him - respondent submits that penalty should only be imposed when there is a mens rea and deliberate attempt to violate the provisions of law and as he has complied with this Authority's Order No. 17/2018 which depicted his bonafide intentions, penalty should not be imposed upon him.

Held: Perusal of Section 122(1)(i) makes it clear that the violation of the provisions of Section 171(1) is not covered under it as it does not provide penalty for not passing on the benefits of tax reduction and ITC and hence the above penalty cannot be imposed for violation of the anti-profiteering provisions made under Section 171 of the above Act - Furthermore, vide Section 112 of the Finance Act, 2019 specific penalty provisions have been added for violation of the provisions of Section 171 (1) which have come in to force w.e.f. 01.01.2020, by inserting Section 171 (3A) - However, since no penalty provisions were in existence between the period w.e.f. 15.11.2017 to 31.03.2018 when the Respondent had violated the provisions of Section 171(1), the penalty prescribed under Section 171(3A) cannot be imposed on the Respondent retrospectively - Accordingly, the notice dated 01.01.2019 issued to the Respondent for imposition of penalty under Section 122 (1) (i) is hereby withdrawn and the present penalty proceedings launched against him are accordingly dropped: NAA

- Disposed of: NAA

2020-TIOL-44-NAA-GST

Director General Of Anti-Profiteering Vs Lite Bite Travel Foods Pvt Ltd

GST - Anti-Profiteering - s.171 of the CGST Act, 2017 - Applicant alleges profiteering in respect of restaurant service supplied by respondent (franchisee of M/s Subway Systems India P Ltd.) - it is alleged that despite the reduction in the rate of GST from 18% to 5% w.e.f 15.11.2017, respondent had not passed on the commensurate benefit since they had increased the base prices of his products - Based on the report of the DGAP and the submissions made, the profiteered amount is determined as Rs.61,67,097/- as computed in Annexure 15 of the DGAP's report dated 25.10.2019 - respondent is directed to reduce his prices commensurately in terms of rule 133(3)(a) of the Rules - since recipients are not identifiable, respondent is directed to deposit an amount of Rs.61,67,097/- in two equal parts each in the Central Consumer Welfare Fund and the Maharashtra State Consumer Welfare Fund as per the provisions of rule 133(3)(c) of the Rules, 2017 along with interest payable @18% - amount to be deposited within 3 months failing which it shall be recovered by the Commissioners concerned - contravention of s.171(1) of the Act is an offence liable to penal action under section 171(3A) of the Act read with Rule 133(3)(d) of the Rules; SCN to be issued accordingly - DGAP has reported that the respondent has 35 operational outlets at Mumbai International Airport, Terminal 2 and out of these 35 outlets only 2 were franchisees of M/s Subway Systems India P Ltd. - this Authority has reasons to believe that there is a need to investigate all the outlets of the respondent since profiteering on the part of the respondent has already been established in the case of his two Subway outlets as also the fact that supplies from various outlets are being made through a single GST registration and the same ITC pool/electronic credit ledger is being used for all the supplies being made from that registration - Authority, in line with provisions of s.171(2) of the Act and Rule 133(5)(a) of the Rules directs the DGAP to further investigate all the other outlets of the said respondent - Order is passed taking into consideration notification 55/2020-CT: NAA

- Application disposed of: NAA

SERVICE TAX

2020-TIOL-1248-CESTAT-ALL

Narsi Iron & Steel Pvt Ltd Vs CCGST & CE

ST - The assessee was engaged in 'Construction Activities' - Investigations were initiated and various records were resumed and statements were recorded - On the basis of examination of documents, it appeared to revenue that assessee was providing 'Construction of Residential Complex Service' for the period upto 30.06.2012 and same service after 01.07.2012 being covered by the provisions of Section 66 E of FA, 1994 - It was stated in SCN issued to assessee that they had informed through a declaration that for each independent complete villa and/or flat sold from 01.04.2010 to 30.09.2015, carpet area was less than 2,000 square feet and the amount charged for each such complete villa or flat was less than Rs.1 crore - Through the said SCN, service tax was demanded under proviso to Sub-section (1) of Section 73 of FA, 1994 - There is no evidence on record to establish that the assessee had constructed a residential complex before 30.06.2012 or they had constructed a complex with more than 2 residential units together after 01.07.2012 - Assessee did not provide residential complex service prior to 01.07.2012 and they were eligible for exemption under Notfn 25/2012-ST for activity of construction undertaken by him for the period subsequent to 01.07.2012 - Further, assessee was not liable to pay Service Tax under Reverse Charge Mechanism - The impugned order is therefore set aside: CESTAT

- Appeal allowed: ALLAHADBAD CESTAST

2020-TIOL-1247-CESTAT-BANG

GMR Corporate Centre Pvt Ltd Vs CCE, CST

ST - The appellant company is a limited company by guarantee and not by having share capital - The main objects of the appellant company, as per its Memorandum of Association, are to enable the members of the company to mutually avail and share common facilities and resources afforded by the company with a view to optimize the benefits of specialization and achieve economies of scale to minimize costs for each of the members - Whether the appellant company is liable to pay service tax under category of BAS for the period April 2007 to September 2011 or whether the activity of assessee is not taxable under the principle of mutuality, being services provided to group /promoter companies - The companies have come together to share the resources and there is mutuality of interest of the promoters /member companies - No evidence of any consideration paid by Group Companies for providing of services to the member-companies or GMR group of companies - The only basis for providing of services by appellant is on cost sharing basis as per the norms or formula laid down by the members of appellant company - Therefore, the SCN is not maintainable both on the principle of mutuality and on the fact of lack of consideration for such services alleged to have been rendered - The precedent ruling of Tribunal is followed in case of Raheja Universal Pvt. Ltd. 2017-TIOL-2275-CESTAT-MUM - Accordingly, the impugned order is set aside: CESTAT

- Appeal allowed: BANGALORE CESTAT

2020-TIOL-1246-CESTAT-HYD

Dr Reddy's Laboratories Ltd Vs CC, CE & ST

ST - The assessee has created a single Integrated Product Development Organisation Unit (IPDO) at Bachupally to undertake research and development activities of their products - They had taken CENVAT Credit on the services used in IPDO - Revenue views that the IPDO not being a manufacturer of excisable goods nor provider of taxable services, no CENVAT Credit is admissible on the input services used in the IPDO - SCNs were issued proposing to recover CENVAT Credit availed by assessee invoking the extended period of limitation - Pharmaceutical industry is one which involves a lot of research and development which distinguishes the product of the manufacturer from those of others - In fact, a large proportion of the cost of any pharmaceutical product is on account of the amounts spent on research and development both in terms of discovery of a new molecule and also in terms of developing an appropriate formulation containing various quantities of different drugs - Once a product is developed, the product has to be necessarily certified by the Drugs Controller for it to be marketable and this involves requisite paper work, clearances and obtaining the certificates without which the product cannot be marketed - Therefore, as far as pharmaceutical industry is concerned, research & development is an essential part of the entire manufacturing process - The services used in R&D have a direct nexus with the manufacture of final products - It is not necessary that the pharmaceutical industry has a complete R&D facility in each of its manufacturing units - In order to economise and benefit from the economies of scale, R&D units are set up as independent units for serving various manufacturing units of the manufacturer - In such a case, the services availed in R&D units have a direct nexus to the manufacture of products in various units - If the assessee is registered as an input service distributor, the CENVAT Credit availed on services used in R&D unit can be distributed to various manufacturing units - The assessee has just done that - The issue is no longer res integra and stands decided in favour of assessee by case law in Aurobindo Pharma Limited - 2019-TIOL-3415-CESTAT-HYD - The impugned orders are unsustainable and are set aside: CESTAT

- Appeals allowed: HYDERABAD CESTAT

CENTRAL EXCISE

2020-TIOL-1245-CESTAT-HYD

CCT Vs Exel Rubber Ltd

CX - The assessee is manufacturer of tyres under brand name 'CEAT' on job work basis - They clear the tyres to the sales office/ depots of C & F agents of the principal manufacturers - The goods were assessed to duty on the value determined under Rule 10A(ii) of CER, 2000 - Since the price of the goods were not known to the assessee at the time of clearance of goods on account of various discounts offered by principal manufacturer to buyers, they sought provisional assessment of goods - The main grievance of revenue against the order of first appellate authority is that the assessee has not submitted CA certificate along with necessary documents to prove that they have passed on the discounts claimed to the buyers - The Commissioner (A) has allowed the discounts on the basis of invoices, credit notes and equalised octroi/ entry taxes - On identical issue, this bench had upheld the order of the Commissioner (A) for earlier periods in respect of the same assessee vide Final Order dt.25.10.2019 - This decision has, so far not been overturned or set aside by any higher judicial forum - Therefore, the decision is binding on this bench - The impugned orders are upheld and the appeals filed by the revenue are rejected: CESTAT

- Appeals rejected: HYDERABAD CESTAT

2020-TIOL-1244-CESTAT-KOL

Water Treatment Company Vs CCE

CX - As per agreement entered with the Executive Engineer, Zilla Parishad, Andaman & Nicobar Islands, appellant undertook setting up a Reverse Osmosis (RO) Water Treatment Plant for providing potable drinking water for the community – Alleging evasion of CE duty in the supply and setting up of such RO Water Treatment plants, demand issued for recovery of duty of Rs.68,67,384/- - demand upheld and penalty imposed, hence appeal.

Held: After considering the Certificates issued by the Executive Engineers, Zilla Parishad as well as processes of setting up of Water Treatment Plant, Bench is of the view that Water Treatment Plant erected at the site, cannot be considered as "goods" - The Plant has come into existence only at the site in a progressive manner on a civil construction platform and after conclusion of such erection, it is clearly in the form of immovable structure - The fact that about 60% of the Plant can be dismantled without damage thereof, cannot be a reason to reject the aforesaid conclusion - excisability of such Water Treatment Plants, has come up before the Tribunal in several cases and a view has been taken that the process of erection at site, does not bring into existence "goods" and hence not liable to duty - Bombay High Court in the case of Larsen & Toubro Ltd. - 2009-TIOL-493-HC-MUM-CX , has also taken a similar view – There is, therefore, no justification to charge excise duty on the Water Treatment Plant - impugned order is set aside and the appeal is allowed with consequential relief: CESTAT [para 10, 11, 13 to 15]

- Appeal allowed: KOLKATA CESTAT

2020-TIOL-1243-CESTAT-KOL

Victory Iron Works Ltd Vs CGST & CC

CUSTOMS

2020-TIOL-1242-CESTAT-DEL

Shyam Singh Yadav Vs CC

Cus - The issue in this appeal is, whether original authorization from DGFT for import of goods being cartridges vide Bill of Entry dated 22.1.2015 under License dated 1 June 2011 was required and submission of the same in original to the Custom authorities for clearance is sine qua non, for getting clearance - Production of import license issued by DGFT was necessary for clearance of goods being cartridges filed under Bill of Entry dated 22 January 2015 - However, in view of the status of assessee, being renowned shot/sportsmen and a coach of international repute, winner of Draunacharya Award from the Government of India, there is no reason to disbelieve the assessee that he has not imported any other consignments under the said import license, which has finally expired on 31.1.2015 - Admittedly, the Bill of Entry was filed on 22.1.2015 when the import license was valid, satisfying the condition of import for 'restrictive goods' - Further, the Principal Commissioner have issued utilization certificate dated 23 June 2016, which clearly states that the assessee have only imported one consignment earlier on 25 May, 2013 and hence is legally entitled to import the goods under present bill of entry under dispute - Further non-import of cartridges, more than that permitted under 'Import License', is also corroborated from the original 'Arms License', produced at the time of hearing - The cartridges imported under present bill of entry dated 22.1.2015, is within the quantity permitted under the Arms License as well as the import license issued by DGFT, which is not disputed - The order of confiscation of the consignment under Bill of Entry dated 22.1.2015 is uncalled for and accordingly, is set aside along with the penalty - The warehouse charges or demurrage if any, above Rs. 25,000/- are also waived - The appeal is allowed with consequential benefits and the impugned order is set aside - The Custom Department is directed to release the goods under Bill of Entry dated 22.1.2015 forthwith to the assessee within a period of one month from the date of production or receipt of this order - The assessee is directed to file appropriate indemnity bond before the Custom authorities: CESTAT

- Appeal allowed: DELHI CESTAT

2020-TIOL-1241-CESTAT-DEL

Tarkesh Art Jewellery Vs CC

Cus - On 3.8.2016 at 6.45 p.m. during the checking by the security staff posted at the gate of SEZ, Zone-II, Sitapura Jaipur, a vehicle No.RJ 19 CA 6174 being driven by Shri Chetan Mayach S/o Girdhari Lal Mayach (Appellant) Production in Charge of M/s. Tarkesh Art Jewellery, was trying to exit from the gate without checking - Three gunny bags were found lying in the dicky (Boot Space) of the said car containing silver grains packed in four metal boxes and the weight of the silver grains was carried out and the net quantity of 78.780 kgs. was found - no documents for removal of the goods were produced by Chetan Mayach - Production-in-charge - On a reasonable belief that the said goods were liable to confiscation under Section 111, and the conveyance carrying the said goods was also liable to confiscation under Section 115 of the Customs Act, 1962, as the same were being removed for clandestine removal in contravention of the provisions of SEZ Act, 2005 read with the provisions of Customs Act, 1962 (as made applicable), the silver grain totally weighing 78.780 kgs. valued at Rs.35,70,310/- was seized along with the vehicle bearing no.RJ-19 CA 6174 Make Hundai Santro valued at Rs.60,000/- under Section 110 of the Customs Act, 1962 - It appeared that M/s. Tarkesh Art Jewellery (appellant) was not maintaining the stock register on day to day basis in contravention of the provisions of Rule 34 of the SEZ Rules, 2006 read with Rule 22(2) of the SEZ Rules, 2006, and was indulging in the clandestine removal of the goods from the SEZ without documentation and without discharging the duty liability on such removals - Pursuant to the issue of show cause notice dated 31.01.2017 , order of adjudication dated 29.08.2017 was passed, which was modified in part vide impugned order-in-appeal - aggrieved, the appellants are in appeal before Tribunal.

Held: Vide Notification no.GO 2665 (E) dated 9.8.2016, the Government in exercise of the powers under sub-section (1) of Section 21 of the SEZ Act, notified the offences contained in Sections 111, 113 and 115 etc of the Customs Act, 1962, as offence under the SEZ Act - Thus, prior to 9.8.2016, Section 111 of the Customs Act is not attracted, when admittedly, the incidence of seizure and inspection was on 3/4th August, 2016 - Authorised operations under the SEZ Act are the activities permitted to a Developer by the Board of Approval or those permitted to units by the Approval Committee - Tribunal in the case of Charisma Jewellery Pvt. Ltd. - 2016-TIOL-1963-CESTAT-MUM has held that there are adequate safeguards in that Act without the need to indulge in misadventure under the Customs Act, 1962 that does not extend to special economic zones; that there are also provisions for action in the event of illicit removal by units; that the notice issued by the Development Commissioner of SEEPZ Special Economic Zone is testimony to it; proceedings thereon will suffice to safeguard the economic integrity of the nation - Division Bench in Sangam International - 2017-TIOL-2439-CESTAT-DEL relying on its earlier judgement in the case of Meenakshi International - 2017-TIOL-01-CESTAT-DEL held that Customs Department did not have jurisdiction within the SEZ area established under SEZ Scheme read with SEZ Act and accordingly, the order of confiscation and penalty was set aside - appellant had given a cogent explanation at the time of seizure and also the said explanation was supported by the statement of Proprietor of Tarkesh Art Jewellery - relying upon the ruling of the Division Bench of this Tribunal in the case of Sangam International (supra) and the cogent explanation given by the appellant, which has not been found to be untrue, impugned order is set aside and the appeals are allowed with consequential relief: CESTAT [para 13 to 16]

- Appeals allowed: DELHI CESTAT