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2020-TIOL-NEWS-249| October 21, 2020
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Dear Member,
Sending following links. Warm Regards,
TIOL Content Team
TIOL PRIVATE LIMITED.
For assistance please call us at + 91 850 600 0282 or email us at helpdesk@tiol.in. |
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INCOME TAX |
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2020-TIOL-1756-HC-DEL-IT
Anju Jalaj Batra Vs ACIT
Whether it is a settled position in law that any refund payable to an assessee has to be disbursed at time of issuance of order u/s 143(1), unless the order withholding the refund has been passed u/s 241A - YES: HC
- Case deferred: DELHI HIGH COURT
2020-TIOL-1755-HC-KAR-IT
CIT Vs Indus Fila Ltd
Whether in case of amalgamation, it is necessary for the amalgamated company to satisfy the mandate of provisions u/s 72A before claiming set off of accumulated loss incurred by the amalgamating company - YES: HC
- Case remanded: KARNATAKA HIGH COURT
2020-TIOL-1754-HC-MAD-IT
Pr.CIT Vs Precot Meridian Ltd
Whether loss incurred on account of cancellation of forward contracts qualifies as speculative losses falling within the provisions of Section 43(5) of the Act - NO: HC
- Revenue's appeal dismissed: MADRAS HIGH COURT
2020-TIOL-1253-ITAT-DEL
Soni Sonu Mirchandani Vs Asstt CIT
Whether the impugned amount received by the assessee on the transfer of family asset would attract the provisions of capital gains, when the same was a part of a family settlement - Yes: ITAT
- Assessee's appeal dismissed: DELHI ITAT
2020-TIOL-1252-ITAT-BANG
Sandeep Samantha Vs Addl CIT
Whether delay in filing the Form No 26Q should be counted as per sub-rule 4A of Rule 31A - YES: ITAT
- Assessee's appeal allowed: BANGALORE ITAT
2020-TIOL-1251-ITAT-BANG
Sandeep Patil Vs ITO
Whether as per the provisions of section 50C(1), the difference in stamp duty valuation and actual consideration should be ignored, if it is less than 5%/10% - YES: ITAT
- Assessee's appeal allowed: BANGALORE ITAT
2020-TIOL-1250-ITAT-PUNE
Shrikant Vishwanath Gogate Vs CIT
Whether the assessee is entitled for deduction u/s 54 if there is transfer of residential house property - YES : ITAT
- Assessee's appeal partly allowed: PUNE ITAT
2020-TIOL-1249-ITAT-PUNE
Sant Motiram Maharaj Sahakari Pat Sanstha Ltd Vs ITO
Whether interest on IT refund u/s. 244A is covered within the expression "profits and gains of business" occurring in section 80P(2)(a) and ergo eligible for deduction u/s. 80P(2)(a)(i) - YES : ITAT
- Assessee's appeal allowed: PUNE ITAT
2020-TIOL-1248-ITAT-JAIPUR
Shanta Sales Corporation Vs ITO
Whether the books of assessee can be rejected by merely holding that there is variation in gross profit rate in trading of clay - NO: ITAT
Whether the books of accounts of assessee can be rejected giving his opinions/observations on technical issues of the mode and manner of production process, without seeking an expert report on the same - NO: ITAT
- Assessee's appeal allowed: JAIPUR ITAT
2020-TIOL-1247-ITAT-CHD
Punjab Institute of Medical Sciences Vs DCIT
Whether neither on accrual basis nor on receipt basis any taxable income arises from grant or funds received from the government under the Tripartite agreement by charitable society - YES : ITAT
- Assessee's appeal allowed: CHANDIGARH ITAT
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GST CASES |
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2020-TIOL-269-AAR-GST
Vimos Technocrats Pvt Ltd
GST - Pure Consultancy services (without supply of goods) provided by applicant to Municipalities and Corporations (local bodies) and State Government departments are exempt from GST as per Sr. no. 3 of 12/2017-CTR - Pure Consultancy services provided to private individuals is taxable @18% as per Entry no. 21 of 11/2017-CTR - ITC paid on purchase of capital goods like furniture, computer, lab equipments, drone camera, total station, auto level instruments etc. and on certain input services will be restricted to so much of the input tax as is attributable to taxable supplies made by applicant as per s.17(2) of the CGST Act, 2017: AAR
- Application disposed of: AAR
2020-TIOL-268-AAR-GST
Karnataka State Cooperative Marketing Federation Ltd
GST - Supply of Kharif Arhar (Tur) commonly known as Pigeon Pea and Kharif Green Gram without any brand name to NAFED is an exempted supply as per Entry no. 45 of 2/2017-CTR - GST paid on purchase of gunny bags shall not be claimed as ITC as per s.17(2) of the Act - provisions of TDS does not apply to the applicant as they are not covered under the list provided either in notification 51/2018-CT or under the list prescribed u/s 51 of the Act: AAR
- Application disposed of: AAR
2020-TIOL-267-AAR-GST
Fraunhofer Gessellschaft Zur Forderung Der Angewwandten Forschung EV
GST - Liaison activities being undertaken by the applicant (Liaison Office - LO) in line with the conditions specified by RBI amounts to supply in terms of s.7(1)(c) of the CGST Act, 2017 - Applicant is required to be registered under the Act and is liable to pay GST if the place of supply of services is India: AAR
- Application disposed of: AAR
2020-TIOL-266-AAR-GST
Ambara
GST - Applicant is engaged in the business of providing health care services and also runs a hospital in the name of CURA hospital - The applicant provides the services relating to healthcare services which are in the nature of diagnostic and treatment services - The applicant seeks an advance ruling in respect of the following questions viz. whether ITC is required to be restricted on medicines supplied to patients admitted in hospital; whether ITC is required to be restricted on medicines supplied to patients treated as outpatients; whether ITC is required to be restricted on medicines supplied to other than inpatients and outpatients; whether ITC is required to be restricted on supply of food and beverages to the patients admitted in hospital.
Held:
+ The treatment services for diseases are 'healthcare services' as defined under 12/2017-CTR and supply of healthcare services provided by a clinical establishment is exempt from the levy of tax as per Entry no. 74 of the said notification - Since the output supplies are exempt, the applicant is not eligible to claim the ITC paid on the inward supplies of medicines that are used for providing 'healthcare services' to the inpatients: AAR
+ Applicant, while providing treatment to the outpatients uses certain consumables such as medicines, bandages, cotton etc. hence the same are consumed in the provision of healthcare services and the output is only healthcare services - as there is no separate/distinct supply of medicines, bandages, cotton etc. and since they are used in the supply of exempt healthcare services, the impugned supply cannot be a composite supply - applicant is not eligible to claim ITC on taxes paid: AAR
+ With regard to the supply of medicines and other goods to the customers, the applicant is selling the medicines as a trader and hence they are liable to collect and pay the applicable tax on the goods sold and also is eligible to claim ITC like any supplier of taxable goods, subject to the restrictions in s.17 of the CGST Act: AAR
+ Insofar as supply of food and beverages to the inpatients is concerned, if the supply of food and beverages is under the prescribed diet as a part of the treatment process and if it is an integral part of the treatment, then the food and beverages loses its identity as a separate supply and merges with the supply of treatment service similar to supply of medicines - such a supply is an ancillary to the supply of treatment service i.e. healthcare service which is an exempted supply under Entry no. 74 of 12/2017-CTR - in such a situation, no ITC is available: AAR
+ However, if the supply of food and beverages is at the request of the patient, in which regard the Authorised representative clarifies that inpatients are not allowed to consume outside food, since the supply becomes naturally bundled with the treatment service i.e. healthcare service and the supply becomes composite supply which is exempted under Entry 74 of 12/2017-CTR, in which case applicant cannot claim ITC: AAR
- Application disposed of: AAR
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MISC CASE |
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INDIRECT TAX |
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SERVICE TAX
2020-TIOL-1535-CESTAT-MUM
Larsen & Toubro Infotech Ltd Vs CCGST
ST - Refund – Rule 5 of CCR, 2004 - Commissioner (Appeals) has upheld rejection of refund on the ground that the disputed services do not fall under main or inclusive portion of the definition of input service, defined under Rule 2(l) ibid; that services are used for personal use or welfare purpose of the employees but not for business activity and that the appellant did not produce any evidence that service tax in respect of taxable service namely, Sponsorship Service has been paid by it under Reverse Charge Mechanism – appeal filed.
Held: It transpires that the benefit of refund on service tax paid on the input services is available to an assessee, upon compliance of the formula prescribed there under - Rule 5 ibid nowhere specifies that the input services should be used directly in providing the exported output service by an assessee, which was the requirement under the un-amended Rule 5 ibid, effective up to 01.04.2012 - Thus, under the amended provisions of Rule 5 ibid, in vogue, there is no requirement of use of specific input service(s) for providing the exported output service – Therefore, denial the refund benefit on ground of establishment of nexus between input and output services cannot be sustained - Further, the department has not proceeded under Rule 14 ibid for denial of the ineligible Cenvat credit - Since the issue in the present case involves refund of accumulated Cenvat credit under Rule 5 ibid, the findings should only be confined to ascertain whether the requirement of Rule 5 ibid has been complied with or not and establishment of nexus cannot be insisted upon - denial of Cenvat benefit on the input service on the ground of non-establishment of nexus will not stand for judicial scrutiny: CESTAT [para 4]
ST - Refund – CENVAT – Rule 5 of CCR - On the issue of non-submission of evidence regarding payment of service tax on Sponsorship Service, Bench is of the view that the matter should be remanded to the original authority for verification of the evidence regarding payment of service tax amount by the appellant under the Reverse Charge Mechanism: CESTAT [para 5]
- Appeal partly allowed: MUMBAI CESTAT
2020-TIOL-1534-CESTAT-MUM
DBS Bank Ltd Vs CST
ST - Assessee appellant is engaged in the business of providing Banking and Other Financial Service (BOFS) - Issue involved pertains to eligibility of Cenvat Credit of service tax paid on the insurance service received by the bank from the Deposit Insurance and Credit Guarantee Corporation (DICGC).
Held: Larger Bench of the Tribunal in the case of South Indian Bank - 2020-TIOL-861-CESTAT-BANG-LB has held that the insurance service provided by the Deposit Insurance Corporation to the banks is an "input service" and CENVAT credit of service tax paid for this service received by the banks from the Deposit Insurance Corporation can be availed by the banks for rendering 'output services' - Since the issue is no more res integara, the appeal filed by the appellant assessee is allowed by setting aside the impugned order and the appeal filed by Revenue is dismissed: CESTAT [para 4, 5]
- Assessee appeal allowed/Revenue appeal dismissed: MUMBAI CESTAT
CENTRAL EXCISE
2020-TIOL-1533-CESTAT-MUM
Salasar Ispat Pvt Ltd Vs CCE & ST
CX - An intelligence was gathered that the assessee alongwith some other manufacturer were indulging in large scale of evasion of Central Excise duty by clearing their finished goods clandestinely through a broker namely Umesh Modi - A SCN was issued against 4 noticees including the assessee - The main noticee was M/s. Shree Nainadevi Steel Casting Pvt. Ltd. and others were its Director and the broker Vijay Kumar Jindal - So far as the finding of Commissioner, that since the other noticees have not filed any appeal against the Adjudication Order therefore the case of assessee cannot be considered in isolation is concerned, only because others have not challenged the order that doesn't mean that legality of the same cannot be gone into if any one aggrieved challenged it - How the place from where the chits were recovered can be related to the assessee whereas it is their specific plea that it belongs to M/s. Gautam Enterprises - But no one from the said company was examined to establish that it belongs to the assessee only - Mere recovery of private records is not sufficient to prove clandestine removal and a concrete and clinching evidence is required to prove such allegation and it is for the department to discharge the burden and prove the charges of clandestine removal against the assessee - From the records, it is apparent that from the day SCN was issued, assessee was asking for cross examination - Even despite the order of this Tribunal, the adjudicating authority did not permit the cross-examination and brushed aside the same while observing that the request is without any specific reason and is routine in nature - No case is made out against the assessee and the impugned penalty has no basis and is accordingly set aside: CESTAT
- Appeal allowed: MUMBAI CESTAT
CUSTOMS
2020-TIOL-1532-CESTAT-MUM
Mangalam Alloys Ltd Vs CC
Cus - Appellants imported 139.24 MT quantity of 'stainless steel melting scrap grade AISI 410' and filed bill of entry classifying the goods under Heading 72.04 (Tariff Item 7204 21 90) as 're-melting scraps ingots of iron or steel' and claiming the benefit of exemption under Sl. No.202 of Notification No.21/02-Cus. - Department, on physical examination, objected to the Appellants' claim that the imported goods are scrap as it was of the opinion that these goods are in nature secondary/defective/rejected/serviceable material – SCN waived hence Order passed by Commissioner confirming differential duty of Rs 7,62,622 and imposing redemption fine of Rs 10,00,000 and penalty of Rs 4,00,000 – aggrieved, appeal filed.
Held: Brief point to be decided in this case is as to whether heavy melting scrap HMS imported by the appellants can be classified as serviceable parts and thus, exemption availed needs to be denied - On the basis of the examination conducted at the time of clearance, department opined that the impugned goods were secondary/defective/rejected stock comprising of stainless-steel U and C channels of grade 410 (magnetic) and HR coils/strips of grade 410 (magnetic) - The appellants submit that the examination report was not given to them - Appellants further submitted that no examination by a Chartered Engineer was conducted; pre-shipment inspection certificate and certificate issued by M/s. Alloys and Metal Test Services, Mumbai were ignored - Also, the request of the appellants for mutilating the goods before clearance was also not allowed - It is the contention of the appellants that by nature, steel melting scrap is likely to have some defective secondary parts or articles - However, the supplier treated the same as scrap only and it is a matter of fact that the said scrap was utilised in their factory for melting only, therefore, denying the classification and the exemption are bad in law – Bench finds that the adjudicating authority has not explained as to why various certificates submitted by the appellants were not accepted - It is also not known as to why the department has not allowed the request for mutilation of the goods before clearance - Chartered Engineer's examination was also not ordered - This being the factual milieu, Bench finds that department cannot reclassify the goods unilaterally on the basis of the examination report of officers alone - Technical opinion given by the pre-inspection certificate and by M/s. Alloys and Metal Test Services, cannot be disregarded - Also the fact that all the shipping documents describe the goods as steel melting scrap only cannot be denied - Under such circumstances, denying the classification and the benefit of exemption are not tenable - Department has not made its case for redetermination of the value of the impugned goods for the purpose of assessment - It is also not the case of the department that value over and above the price declared in the invoice was paid to the overseas supplier - It is also not the case of the department that the said scrap was not utilised as scrap - Impugned order is not maintainable, hence same is set aside and appeal is allowed with consequential relief: CESTAT [para 4, 5]
- Appeal allowed: MUMBAI CESTAT |
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HIGH LIGHTS (SISTER PORTAL ) |
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TIOL PRIVATE LIMITED.
TIOL HOUSE, 490, Udyog Vihar, Phase - V,
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