2020-TIOL-1886-HC-MAD-IT

Dinamalar Tamil Daily Vs JCIT

On appeal, the High Court observes that the assessee seeks to resolve the matter under the Vivaad Se Vishwaas Scheme 2020. Hence it accepts the assessee's request to withdraw the present appeal. It also directs the Competent Authority to consider the assessee's application under the Scheme and pass appropriate order in 8 weeks' time.

-   Assessee's appeal disposed of : MADRAS HIGH COURT

2020-TIOL-1885-HC-DEL-IT

Agilent Technologies India Pvt Ltd Vs ACIT

In writ, the High Court notes that the Revenue should have given effect to the TPO's order and should have disbursed the refund immediately. Hence directions are issued to the Revenue to give effect the order passed by the TPO and grant refund with interest u/s 244A and also pass rectification orders within four weeks' time.

2020-TIOL-1884-HC-DEL-IT

Tulsi Ram Gaya Prasad Pvt Ltd Vs ITSC

In writ, the High Court observes that the present petition challenges an anterior order arising from the same settlement proceedings. The final outcome of the proceedings could affect the proceedings before this court. Hence the court directs that the petition be listed for further hearing on Nov 25, 2020.

- Case deferred : DELHI HIGH COURT

2020-TIOL-1883-HC-KAR-IT

CIT Vs Syndicate Bank

Whether assessee is entitled to interest in terms of Section 244A of the Act - YES : HC

- Revenue's appeal dismissed : KARNATAKA HIGH COURT

2020-TIOL-1882-HC-MAD-IT

CIT Vs Sengunthar Matriculation Higher Secondary School

2020-TIOL-1366-ITAT-MUM

DCIT Vs State Bank of India

Whether recovered bad debts of a bank partakes the character of deemed income in the year of receipt in terms of Section 41(4) and is hence taxable - NO: ITAT

Whether income of foreign branches of a bank needs to be included in the total income of the bank and the same is taxable in India - NO: ITAT

- Revenue's appeal partly allowed: MUMBAI ITAT

2020-TIOL-1365-ITAT-MUM

Mehta Equities Ltd Vs DCIT

Whether if AO wants to invoke provisions of section 36(1)(ii) on the touchstone of evasion, then he will have to give clear cut finding as to what tax avoidance or tax evasion was involved in such case - YES: ITAT

- Case remanded: MUMBAI ITAT

2020-TIOL-1364-ITAT-DEL

DCIT Vs Infrasoft Technologies Ltd

Whether goodwill / customer contracts duly recorded in the audited financials are eligible for depreciation being intangible assets u/s 32(1)(ii) - YES: ITAT

- Revenue's appeal dismissed: DELHI ITAT

2020-TIOL-1363-ITAT-DEL

Gangeshwari Metals Pvt Ltd Vs ITO

Whether reopening of assessment can be done merely on the receipt of certain information from Investigation Wing of the Income-tax Department without any further enquiry done by the AO himself - NO: ITAT

Whether addition u/s 68 can be done on profit earned on commodity trading through a company registered with NMCE - NO: ITAT

- Assessee's appeal allowed: DELHI ITAT

2020-TIOL-1362-ITAT-AHM

Balkrishna Purshottamdas Patel Vs DCIT

Whether disallowance u/s 14A is sustainable when the assessee has shown exempt income as dividend from investment but have suo moto not disallowed any expenditure incurred on it - NO: ITAT

Whether an addition u/s 69 can be made when there is a failure on assessee's part to substantiate the source of investment - YES: ITAT

Whether an addition on account of unsecured loan can be added to assessee's income because till the date of assessment order the assessee fails to furnish the supporting evidences and information to prove the genuineness of the loan transaction - NO: ITAT

- Assessee's appeal partly allowed: AHMEDABAD ITAT

2020-TIOL-1361-ITAT-AHM

Gold Finch Jewellery Ltd Vs Pr CIT

Whether PCIT can exercise powers u/s 263 when AO has allowed the claim of expenditure pertaining to foreign exchange premium after due verification - NO: ITAT

- Assessee's appeal allowed: AHMEDABAD ITAT

2020-TIOL-1360-ITAT-PUNE

Kachhi Heritage Vs ACIT

Whether partnership deed can be rejected and partners' salary can be assessed as AOP only on the ground that the deed of partnership firm was not executed on requisite stamp paper - NO: ITAT

- Assessee's appeal partly allowed: PUNE ITAT

2020-TIOL-1359-ITAT-BANG

JCIT Vs Institute of Manpower Planning & Training

Whether the AO is empowered to process those returns which already have been declared invalid - NO: ITAT

- Revenue's appeal partly allowed: BANGALORE ITAT

2020-TIOL-1358-ITAT-MUM

Pavapuri Metals And Tubes Vs ITO

Whether disallowance for bogus purchases can be reduced to the extent of profit element embedded in these purchase where sales are not in doubt and considering nature of assessee's business addition non-genuine purchases can be made at 4% - YES: ITAT

- Assessee's appeal partly allowed: MUMBAI ITAT

Sree Rama Steels Vs Deputy State Tax Officer

GST - Petitioner alleges that in order to save transport expenditure and time in getting the goods transported to (i) the petitioner's premises at Proddatur, Andhra Pradesh and (ii) later on to the buyer's premises also at Proddatur, Andhra Pradesh, and (iii) again transporting them to the Job work site in Telangana State, at the request of M/s.Laxmi Narasimha Constructions, Proddatur, the petitioner telephonically instructed the driver of vehicle to take the goods to M/s JVS Switchgear LLP at Katedan/ Mailardevpally, Rajendranagar, Telangana State, stating that tax invoice and  e-Way Bill generated by petitioner on the customer were also being sent - According to petitioner, even though the driver of the vehicle produced all documents such as Tax Invoice and  e -Way Bill, on the ground that the said documents are for transporting the goods to Proddatur, Andhra Pradesh but the vehicle was proceeding to deliver the goods at Katedan, the 1st respondent detained the same by issuing an order of detention in Form GST-MOV06 dt.27.1.2020 by mentioning the ground 'wrong destination is noticed' - Thereafter, the 1st respondent issued notice dt.27.1.2020 to petitioner asking the petitioner to show-cause within seven (7) days why tax under the Act along with penalty equal to tax to the tune of Rs.4,30,778/- should not be recovered from petitioner - Since the transporter was pressurizing the petitioner to get his vehicle released, the petitioner paid on 30.1.2020  under protest  total tax and penalty amounting to Rs.4,30,778/- demanded by the 1 st respondent, and the petitioner also gave a letter on 30.01.2020 stating so - detained goods and the vehicle were then released after payment of tax and penalty on 30.01.2020 – Since no order was passed against the petitioner by the 1 st respondent which could have been challenged by the petitioner by filing any statutory appeal, petitioner cannot avail the appellate remedy and since the impugned action of the 1 st respondent was without jurisdiction, the present Writ Petition is maintainable – Petitioner also seeks refund of the amount of tax and penalty paid by them.

Held:

+ Without there being any order/decision passed by the 1st respondent and communicated to the petitioner, the petitioner cannot be expected to file appeal invoking Section 107 of the TGST Act, 2017, therefore, writ petition is maintainable. [para 44]

+ Bench is in complete agreement with the ratio laid down by the Gujarat High Court in Synergy Fertichem Pvt. Ltd. vs. State of Gujarat [2019-TIOL-2950-HC-AHM-GST] [para 54]

+ In the Show cause notice dt. 27.1.2020 issued to the petitioner, the only reason assigned by the 1 st respondent was that 'wrong destination is noticed'. [para 56]

+ 'Noticing the conveyance at a wrong destination' without anything more cannot be said to be a contravention of the CGST Act/Telangana GST Act, 2017 and it is not an taxable event, for there could be several reasons for the same including the driver losing his way or stopping for repair or to answer a call of nature. [para 58]

+ Once the conveyance/vehicle driver had the tax invoice and the e-way bill, there is prima facie compliance with the provisions of the CGST Act and Telangana GST Act and the rules made thereunder and as per para 5 of the circular dt. 14.9.2018 referred to above, it did not warrant initiating of proceedings under Sec. 129 of the Telangana GST Act, 2017. [para 60]

+ It is not as if when goods are in transit there is a prohibition of their sale by the purchaser to a third party. In fact the court can take judicial notice that it is quite a common thing and a well recognized trade practice.

+ It is also important to note that 26.1.2020 i.e., the day when the goods were loaded on the vehicle was a Public Holiday, i.e., Republic Day.

+ If there is any transaction between the petitioner and M/s. Laxmi Narasimha Constructions, Proddatur, Andhra Pradesh on 27.01.2020, the next working day after 26.1.2020, there is no need to suspect the bona fides of transaction merely because the Ex.P9 - e - Way Bill was generated at 9.48 am, along with a tax invoice in favour of purchaser, viz., M/s. Laxmi Narasimha Constructions, Proddatur, about two hours after the vehicle's detention at 7.50 am and cannot be construed that petitioner had an intention to unload the goods at Katedan, Hyderabad, which is somehow contrary to law. [para 70]

+ Any defect, if any, in the documentation accompanying the goods has to be looked at in terms of the Circular dt. 14.09.2018 issued by the Central Board of Indirect Taxes and Customs, New Delhi. [para 72]

+ Bench rejects the contention of the 1st respondent that producing the e -Way Bill and tax invoice by the petitioner in favour of M/s. Laxmi Narasimha Constructions, Proddatur bearing the date 27.01.2020 is only an after-thought to cover up its laches. [para 74]

+ One must keep in mind that CGST Act, 2017/ Telangana GST Act, 2017 are very recent laws and the common businessman is admittedly having difficulty to understand these enactments and the procedures they have introduced. It is important to note that interpretation of taxing statutes should be done in a way to facilitate business and inter-State trading, and not in a perverse manner which would result in impediment of the same by harassing business persons. [para 75]

+ It is absurd for the 1st respondent to say that while filing objections / reply to the show-cause notice, the petitioner did not mention about collection of tax and penalty forcibly, and that that allegation is made for the first time only before this Court only as an after-thought. [para 77]

+ At the time when the petitioner filed objections on 27.01.2020 through the driver of the vehicle to the show-cause notice issued by the 1st respondent on 27.01.2020, tax and penalty had not been paid by the petitioner at all. Therefore, there was no occasion for the petitioner to refer to the same in the reply to the show-cause notice. [para 78]

+ Writ Petition is allowed and the action of 1st respondent in collecting the sum of Rs. 4,30,778/- from petitioner on 30.01.2020 is declared as arbitrary and violative of Articles 14 and 265 of the Constitution of India, and also the provisions of CGST Act, 2017 and TGST Act, 2017, and also the Circular dt. 14.09.2018, issued by the Government of India; and consequently, the respondents are directed to refund the said amount with interest at the rate of 6% per annum from 30.01.2020 till date of payment within 6 weeks. [para 80]

- Petition allowed: TELANGANA HIGH COURT

2020-TIOL-1898-HC-TELANGANA-GST

Agarwal Foundries Pvt Ltd Vs UoI

GST - The question which arises for consideration is whether officials belonging to the G.S.T. Intelligence Department of the Union of India such as respondent nos. 5 to 9 in the Writ Petition can resort to physical violence while conducting interrogation of the petitioners and their employees in connection with proceedings initiated against the petitioners by the respondents under the C.G.S.T. Act, 2017 and I.G.S.T. Act, 2017.

Held:

+ While the petitioners allege that there was use of violence and coercion against the petitioners and their employees by respondents 5 to 9 during the said search operations, the respondents deny the same and allege that it was the petitioners and their employees who had obstructed the search operations and allegedly assaulted the 5th respondent. Normally these disputed questions of fact are not to be gone into in a Writ proceeding under Art. 226 of the Constitution of India.

+ However, Bench cannot ignore the material such as Annexure P-4 which is the Out patient Discharge advice of Sunshine Hospital given at 7.45 pm after treatment of the 3rd petitioner by the emergency physician there on 11.12.2019 which stated that ‘ assault today; injury to the left thigh; unable to walk and bear weight;… blunt injury at left thigh ” and which suggests that the 3rd petitioner was injured to such a degree that he was unable to walk and required medical treatment.

+ Though the respondents seek to suggest that such evidence procured by the petitioners ought to be disbelieved by the Bench because Sunshine Hospital is a ‘private hospital' and not a Government Hospital, Bench does not agree with such contention because there is no presumption in law that Doctors in private hospitals do not speak the truth and only Government doctors speak the truth. An injured person is likely to go the nearest available hospital for treatment instead of searching for a Government hospital at that juncture.

+ Bench cannot also ignore the Annexure P5 which is an acknowledgement given by the Police at 6.39 pm on 11.12.2019 that there was a call made by an employee of the 1st petitioner to Phone No. 100 and that a case No. 20190021545598 was assigned to it and that it was assigned to the Mahankali Police station in Secunderabad.

+ In contrast, the FIR 232 of 2019 was registered by the Police at the instance of the respondents much later at 8.30 pm on 11.12.2019 against the petitioners 2 to 4 i.e., 2 hours after the police were contacted by the petitioners employee at 6.39 pm, and 1 hour after the 3rd petitioner was treated in Sunshine Hospital for alleged assault and injury to his left thigh.

+ The omission of the police to register any FIR at the instance of petitioners does not mean that what the respondents allege is true. This is because admittedly no charge sheet has been filed by the police till date against the petitioners 2 to 4 and the petitioners have admittedly secured anticipatory bail from the competent criminal court later.

+ No provision of any law is cited before the Bench by the respondents to say that they are entitled to use physical violence against persons they suspect of being guilty of tax evasion while discharging their duties under the CGST Act, 2017.

+ Merely because the authorities under the CGST Act, 2017 are not to be treated as police officials, they cannot claim any immunity if they indulge in acts of physical violence against persons they suspect of being guilty of tax evasion.

+ In view of this statutory regime [Article 21 of the Constitution and Protection of Human Rights Act, 1993] already in place, it would be futile for the respondents to claim any liberty to torture or use physical violence during the course of search, investigation or interrogation under the CGST Act, 2017 against persons suspected of tax evasion like the petitioners or their employees.

+ The summons issued u/s 70 bears a date 12.12.2019 and asks the 2nd petitioner to appear before 4th respondent at 00:30 hrs on 12.12.2019. This prima-facie indicates that it was issued after midnight on the intervening night of 11.12.2019 and 12.12.2019 asking the 2nd petitioner to appear at the ungodly hour of 00:30 hrs on that day. What was so important to be recorded at such a time, which cannot wait till the morning of 12.12.2019, is not disclosed by the respondents.

+ Prima-facie it amounts to deprivation of the liberty of the 2nd petitioner since he was forced to be present with the respondents 5 to 9 at that late hour on that night.

+ Respondents cannot contend that they will interrogate the persons suspected of committing any tax evasion as per their sweet will forcibly keeping them in their custody for indefinite period. If it is done, it has to be construed as informal custody and the law relating to an accused in custody has to be expressly or impliedly applied. If accused can get all the benefits under Art.22 of the Constitution, a person in such informal custody can say that he is also entitled to get relief under Art.21 of the Constitution of India.

+ Following the principle laid down in P.V. Ramana Reddy [2019-TIOL-873-HC-TELANGANA-GST] that the High Court can entertain an application for pre-arrest protection under Article 226 of the Constitution of India, but such power should be exercised by the High Court sparingly, Bench holds that having regard to the facts and circumstances set out, this case falls under the exceptional category and this Writ Petition is undoubtedly maintainable.

+ Coming to the plea of the petitioners for transfer of investigation is concerned, though normally such transfer is not to be done, in view of the facts and circumstances of this case and the absence of counter affidavit by the 5th respondent denying the allegations of physical violence by him in the course of the search operations against the 3rd petitioner, Bench feels that it would not be appropriate for the 5th respondent to be a participant in the proceedings initiated by the respondents against the petitioners.

+ There is no such absolute bar to permit interrogation of the petitioners in the presence of a lawyer within visible range, but at a distance beyond hearing range. In the special facts and circumstances of the case, the petitioner nos. 2 to 4 or their employees shall be examined in the visible range of their counsel, though not in hearing range.

+ Respondents in their counter-affidavit have raised a plea that they would like to carry on investigation at New Delhi where the Headquarters of DGGI is located.

+ In the midst of the COVID-19 Pandemic there are serious risks involved in people traveling to and from New Delhi and their family members because there is no dispute that New Delhi has several cases of Corona virus infections for the last several months. In the coming winter months, the prediction of the health experts is that there could be more infections and even fatalities caused by the said virus. Also it would entail considerable expense for that many (50 or more) people to travel to Delhi and back apart from high boarding and lodging costs.

+ While the need to proceed with the investigation and take it to the logical conclusion cannot be disputed, whether the respondents can be permitted to put at risk the health and lives of the persons they wish to interrogate in connection with the alleged GST evasion by the 1st petitioner and make them incur a huge amount of expenditure, is to be considered.

+ When the respondents have a Zonal Unit at Hyderabad where they can certainly carry on any enquiries or interrogation, Bench does not think that it is desirable, on account of COVID-19 Pandemic situation and the high cost involved, to allow the respondents to summon 50 or more persons in connection with the investigation of alleged GST evasion by the 1st petitioner to New Delhi by endangering their health and lives.

++ Writ Petition is allowed with the following directions -

(a) The respondents shall not use any acts of violence or torture against petitioner nos. 2 to 4 or their employees in furtherance of enquiry proceedings F.No. 574 / CE / 198 / 2019 / INV initiated against the 1st petitioner;

(b) The enquiry in the above proceedings against the 1st petitioner shall not be handled by the 5th respondent, and he shall not participate in such enquiry, and it shall be transferred to another official to be designated by the 2nd respondent;

(c) Any interrogation of petitioner nos. 2 to 4 or their employees shall be between 10:30 a.m. and 05:00 p.m. on weekdays in the visible range of an Advocate appointed by them, who shall not be in hearing range;

(d) The petitioner nos. 2 to 4 alone can be summoned to New Delhi for the purpose of the above enquiry by the respondents on one occasion for two to three days, and rest of their interrogation and those of their employees shall be conducted at Hyderabad by the respondents; and

(e) The respondents shall adhere to the provisions of the CGST Act, 2017 in conducting search, investigation or enquiry in relation to the alleged tax evasion by the petitioners.

(f) & (g) I.A. Nos. 1, 2 & 3 of 2019 and I.A. No. 1 of 2020 are accordingly disposed of and I.A. No. 2 of 2020 is dismissed. [para 63, 64, 68 to 70, 73 to 75, 78, 83 to 85, 89, 90, 96, 100, 104 to 106, 108]

- Petition allowed: TELANGANA HIGH COURT

2020-TIOL-1888-HC-MUM-CUS

SK Freight Lines Pvt Ltd Vs UoI

Cus - Petitioner has challenged legality and validity of public notice No.29/2020-21 dated 07.09.2020 issued by the Deputy Commissioner of Customs, Customs Broker Station, Mumbai - By the impugned public notice dated 07.09.2020, the provisional Customs broker license has been withdrawn - Respondents have contended that petitioner No.2 having qualified under Regulation 9 of the 1984 Regulations from Bangalore Customs Commissionerate ought to have applied for regular license from the said Commissionerate - Otherwise, as per Regulations 7(3) and 7(4) of the 2018 Regulations, petitioners can work as customs broker in all customs stations including at Mumbai after two years - Petitioners submits that the impugned order is violative of the principles of natural justice as petitioners were not heard before withdrawal of license and no reasons are mentioned in the impugned order - Respondent submits that petitioners were informed way back on 02.12.2019 about the new requirement and they were put on notice that failure to comply with the 2018 Regulations would result in withdrawal of the license.

Held: Since the impugned order withdrawing customs brokerage license of the petitioners would admittedly lead to adverse civil consequences upon the petitioners, the same ought to have been preceded by a notice and a reasonable opportunity of hearing - Intimating the petitioners about nine months back that because of the new regulations (2018 Regulations), its license may be withdrawn if there is no compliance, may not meet the requirement of principles of natural justice insofar the impugned action is concerned - Besides, the order must speak in itself - An order withdrawing a benefit must give reasons why the benefit has been withdrawn and non-furnishing of reasons would vitiate such an order - Impugned order dated 07.09.2020 is set aside and matter is remanded to respondent No.2 i.e., Principal Commissioner of Customs (General), Mumbai who shall give an opportunity of hearing to the petitioners and thereafter pass an appropriate order in accordance with law within a period of 3 weeks - However, till fresh decision is taken by respondent No.2 within the period aforesaid, status-quo as on today shall be maintained - Writ petition is disposed of: High Court [para 12 to 14]

- Petition disposed of : BOMBAY HIGH COURT

2020-TIOL-1887-HC-MUM-ST

Prathamesh Dream Properties Pvt Ltd Vs Commissioner of CGST & CE

ST - SVLDRS, 2019 - Petitioner is engaged in the business of construction of warehouses and letting them out on rent to wholesalers and retailers - SCN dated 08.04.2014 was issued by Commissioner of Service Tax demanding service tax of Rs.3,60,03,185/- for the period 2008-09 to 2012-13 - During investigation and prior to issuance of SCN, petitioner paid service tax dues of Rs.2,80,74,255/- - The debtor was instructed by the service tax authorities to remit the rental dues to be paid to the petitioner to the account of the Service Tax Commissionerate account - And accordingly, a total amount of Rs.17,94,402/- remitted by M/s Future Retail Limited towards lease rent during the period when the said debtor account was frozen by the service tax authorities was appropriated by the service tax authorities - later, the freezing of account was lifted w.e.f 30.06.2014 - Thus according to petitioner, it had paid a total amount of Rs.2,80,74,255/- on account of service tax dues prior to issuance of SCN and a further amount of Rs.17,94,402/- was appropriated from the debtor's account prior to and immediately preceding the SCN dated 08.04.2014 - Consequently, an order-in-original was passed on 18.09.2018 confirming the service tax demand of Rs.3,60,03,185/- along with interest and penalty - An appeal was filed against this order on 17.12.2018 before the CESTAT along with payment of statutory fees but the said appeal was kept aside as defective and subsequently the appeal was dismissed on 09.12.2019 - Petitioner states that the alleged intimation by the registry for rectification of defect was never received by the petitioner - Since their appeal was pending before the CESTAT as on 30.06.2019, they filed an application under the SVLDRS, 2019 on 23.12.2019 under ‘pending litigation category' - However, the Designated Committee issued notice in form SVLDRS-2 to the petitioner on 23.01.2020 treating the petitioner as a declarant under ‘arrears category' and not under ‘pending litigation category' - Vide the said notice, the Designated Committee proposed the amount in arrears at Rs.79,85,457/- and on that basis the relief to the petitioner was determined as Rs.31,94,182.80 - An amount of Rs.47,91,274.20 (Rs.79,85,457/- minus Rs.31,94,182.80) was quantified as the dues payable by petitioner - the Designated Authority accepted Rs.2,80,17,728/- as pre-deposit and not Rs.2,98,68,657/- - Petitioner disagreed with the computation and the categorisation as ‘arrears category' and consequently a personal hearing was granted on 31.01.2020 - the Designated Committee issued SVLDRS-3 dt. 06.02.2020 restating the earlier position and directing the petitioner to pay Rs.47,91,274.20 and consequently the petitioner, having no other alternative, deposited the said amount on 05.03.2020 and a discharge certificate in form SVLDRS-04 dated 06.03.2020 came to be issued for a full and final settlement of tax dues u/s 127 of the FA, 2019 - Aggrieved, the petitioner is before the High Court.

Held:   

+ In a proceeding under Article 226 of the Constitution of India, Court would ordinarily refrain from entering into determination of facts and figures; for example, in this case, as to what would be the exact quantum of relief available to an applicant (declarant) under the 'pending litigation category' and under the 'arrears category'. [para 13]

+ However, Court would proceed on the projection of the petitioner that if its application (declaration) is treated as one under the ‘pending litigation category', it would be more beneficial to the petitioner as not only no further amount would be required to be paid by the petitioner; rather it would be entitled to refund of the amount paid by it because this aspect is not disputed by the answering respondents in their affidavit. [para 13]

+ Therefore, the dispute boils down to the moot question as to whether application (declaration) of the petitioner should be construed to be one under the ‘pending litigation category' or under the ‘arrears category'? [para 13.1]

+ We find that under section 125(1)(a), a person, who had filed an appeal before the appellate forum and such appeal had been heard finally on or before 30.06.2019, would not be eligible to make a declaration under the scheme.

+ Section 124(1)(a) provides that the relief available to a declarant under the scheme in a case where the tax dues are relatable to the show cause notice or one or more appeals arising out of such notice which is pending as on 30.06.2019 and if the amount of duty is Rs.50 lakhs or less, then 70% of the tax dues and if the amount of duty is more than Rs.50 lakhs, then 50% of the tax dues.

+ Provisions of sub-section (1) of section 124 have been made subject to the conditions specified in sub-section (2) which says that any amount paid as pre-deposit at any stage of appellate proceedings under the indirect tax enactment shall be deducted when issuing the statement indicating the amount payable by the declarant. [para 14]

+ Stand taken by the respondents is that since the appeal was not admitted and was ultimately not entertained on 09.12.2019, which was to the knowledge of the petitioner when it had filed the application (declaration) under the scheme on 23.12.2019, it could not be construed that the appeal of the petitioner was pending as on 30.06.2019; rather in such a scenario it would be a case under the ‘arrears category'. [para 16]

+ Respondents have accepted the position that petitioner had filed an appeal before the appellate forum but that appeal was not finally heard on or before 30.06.2019. It would rather mean that appeal of the petitioner was pending as on 30.06.2019. [para 17]

+ Admittedly, petitioner's appeal was pending before the CESTAT as on 30.06.2019, may be, in defective form. The statute does not say that for being entitled to the relief under the ‘pending litigation category', the appeal must be pending as on 30.06.2019 on being admitted by the appellate forum. This is not the requirement of the law. To hold so would be doing violence to the plain language of the statute. When something is not required or provided by the statute, it would be wholly untenable to add or read such a requirement into the statute to the disadvantage of the applicant (declarant). All that is provided for and is required, is that an appeal must be filed and that appeal should be pending as on 30.06.2019. It is immaterial whether the appeal has been provided a regular number or given a diary number. [para  17.1]

+ In such circumstances, Bench has no hesitation to hold that the appeal filed by the petitioner before the CESTAT against the order-in-original dated 18.09.2018 was pending as on 30.06.2019 and, therefore, the application (declaration) of the petitioner should be treated as one under the ‘pending litigation category' and not one under the ‘arrears category'.

+ This is because in addition to the above discussion, to be eligible under the ‘arrears category' in terms of section 121(c), no appeal should be filed by the declarant against the order-in-original before expiry of the limitation period for filing appeal or the order-in-appeal has attained finality or the declarant has admitted the tax liability but has not paid the same which is not the position in the present case as petitioner had filed appeal against the order-in-original before expiry of the limitation period. [para 18]

+ Declaration of the petitioner filed under the scheme on 23.12.2019 has to be construed to be one under the ‘pending litigation category'.

+ Matter is remanded back to the Designated Committee to take a fresh decision as to the consequential relief to be granted to the petitioner, including refund of the amount paid by the petitioner, treating the declaration of the petitioner as one under the ‘pending litigation category' after affording reasonable opportunity of hearing to the petitioner. This shall be done within a period of four weeks. [ Capgemini Technology Services India Limited ( 2020-TIOL-1625-HC-MUM-ST )  and  Thought Blurb  ( 2020-TIOL-1813-HC-MUM-ST ) relied upon] [para 21]

-Petition allowed : BOMBAY HIGH COURT

2020-TIOL-1597-CESTAT-DEL

Cisco Systems India Pvt Ltd Vs CC

Cus - The assessee is engaged in import of goods for providing captive services in nature of software development, sales and marketing support, product replacement services and other support services to its affiliates - They filed a refund claim under section 27 (1) of Customs Act since duty had been paid on 58% loaded value - Same was rejected - The issue that arises for consideration is as to whether filing of an appeal against an assessment order would itself mean that duty has been paid under protest - The records indicate that the assessee had imported goods from related parties and had filed Bills of Entry which were assessed and duty was paid after loading the declared invoice value so as to make the value equal to 58% of global price list of CISCO - Subsequently, after remand the declared price was enhanced to only 46% of the global price list for the years 2000-08 - This order was accepted both by the assessee and the Department - The reduction of the loaded price from 58% to 46% led to the filing of an application by assessee for refund of excess duty paid for the period April 2004 to June 2008 - This application was rejected primarily for the reason that the assessee had not submitted any evidence to substantiate that duty had been paid under protest and so the refund claim was barred by limitation under section 27(1) of the Customs Act - It is seen that the second proviso to section 11B of the Central Excise Act is identical to the second proviso to section 27 (1) of the Customs Act - Thus, it has to be held that if an appeal is filed against an assessment order, then duty that is paid has to be treated as duty paid under protest and in that case the limitation of six months for filing a refund claim from the date of payment of duty, would not apply - In fact, the Tribunal while remanding the matter to the Commissioner (A) had examined the second proviso as also the fourth proviso to section 27(1) of the Customs Act and had distinguished the two - The Tribunal held that it is the second proviso to section 27 (1) of the Customs Act that would be applicable and not the fourth proviso and so all that the Commissioner (A) was required to decide was whether duty had been paid under protest or not since an appeal against the assessment order had been filed - The Commissioner (A) clearly misunderstood the direction issued by the Tribunal and based his order on the fourth proviso to section 27 (1) of the Act - Thus, the impugned order is set aside: CESTAT

- Appeal allowed: DELHI CESTAT

2020-TIOL-1596-CESTAT-DEL

Decorpac Vs CCE

CX - The assessee is engaged in manufacture of PVC bags and other articles of printing like paper inserts, tags, labels, stickers and stiffeners - The issue arises for consideration is about denial of SSI exemption under Notfns 81/2002-CE and 8/2003-CE by treating the supplies made to merchant exporters against Form 'H' and Form 'ST-49' as clearances for home consumption - A plain reading of Notfns makes it evident that only the clearances for home consumption are to be taken into consideration for determining the admissibility of benefit of exemption under the two Notfns - The finding of the Commissioner that the Notifications do not provide for exclusion of export sales while computing the aggregate value of clearances is, therefore, erroneous - The Commissioner has also held that the value of traded goods cannot be included in aggregate value of clearances for the purpose of SSI exemption for the reason that the proper procedure had not been followed - There has been no violation of procedure and in any case procedural infraction, if any, cannot be made a ground to deny the substantive benefits of SSI exemption to assessee if the goods have been exported - Thus, as the benefit of SSI exemption could not have been denied to assessee, it is not necessary to examine the contention advanced on behalf of the assessee that the extended period of limitation could not have been invoked - It is not possible to sustain the impugned order, same is accordingly, set aside: CESTAT

- Appeal allowed: DELHI CESTAT

2020-TIOL-1595-CESTAT-MUM

Securities Exchange Board of India Vs CCGST

ST - Entry number 51 by notification no. 9/2016-ST dated 1st March 2016, in notification no. 25/2012-ST dated 20 June 2012 reads - Services provided by Securities and Exchange Board of India (SEBI) set up under the Securities and Exchange Board of India Act, 1992 (15 of 1992) by way of protecting the interests of investors in securities and to promote the development of, and to regulate, the securities market; - This notification cannot be considered as clarificatory so as to be given retrospective effect since it is clearly laid down that this insertion would come into effect only from 1st April 2016: CESTAT [para 23]

ST - Limitation - Service tax authorities had raised the issue of taxability of the fees charged by the appellant within a few months of the transition to the 'negative list regime' and the appellant had been in correspondence with appropriate levels in the tax administration seeking acceptance of their interpretation - It, therefore, does not behoove the tax administration to claim that there has been suppression or misrepresentation on the part of the appellant - The delay on the part of tax authorities in issuing show cause notice cannot be justified by the argument that the bar of limitation extends to five years past from the date of issue of show cause notice; the jurisdictional tax authority was cognizant of the non-payment, and the reasons thereof, well before the normal period of limitation had lapsed - Impugned order also makes it clear that the adjudicating authority was receptive enough to reschedule the hearings to enable the noticee to furnish the outcome of representations made to the Ministry of Finance - All of these were undertaken in the light of day and not under cover of the darkness of night - Furthermore, despite the pendency of proceedings for recovery of tax, the Central Government was not averse to excluding the appellant, even if prospectively, from the burden of tax - demand for the period beyond normal limitation, therefore, does not sustain - penalty under section 78 of Finance Act, 1994 is also set aside - appeal is disposed of: CESTAT [para 28 to 30]

- Appeal disposed of: MUMBAI CESTAT