2020-TIOL-2107-HC-ALL-GST

Ansari Construction Vs Additional Commissioner Central Goods And Services Tax

GST - Petitioner was served SCN dated 21.11.2019 proposing to cancel the registration certificate mainly on the ground that the petitioner has failed to file the return for a continuous period of six months - Consequently, an ex-parte order was passed on 30.11.2019 cancelling the registration by invoking the powers u/s 29(2)(5) of UPGST Act - The petitioner filed an application on 19.12.2019 u/s 13 seeking revocation of cancellation of registration on the ground that the petitioner had submitted all the pending returns under GSTR-3B and GSTR-1 and, thus, the entire tax liability stood cleared with the late fees - In response, another SCN dt. 29.12.2019 came to be issued intimating that their application was examined and the same is liable to be rejected for reasons mentioned in this SCN - Even though the SCN was completely vague and did not even point out as to the ground for rejecting the request for revocation of cancellation of registration, an order came to be passed on 30.01.2020 rejecting this application - Appellate authority too dismissed the appeal by order dated 06.07.2020 and remarked that the proper officer was not satisfied u/r 23 of the Rules and in the absence of statutory returns, the facts cannot be verified - Petitioner is, therefore, before the High Court.

Held: Respondent, on the basis of instructions received, states that the taxpayer has filed GSTR-3A up to November 2019 and further there are no dues pending towards tax, late fee, interest up to November 2019 - This case highlights the callous manner in which the assessee has been harassed by the respondent authorities -  Department miserably failed to verify the facts from their own records and proceeded to issue a show cause notice - The manner in which the show cause notice has been issued is wholly unacceptable as it does not record any shortcoming on the part of the assessee -  A perusal of the said show cause notice clearly highlights the fact that serious quasi-adjudicatory functionaries are being discharged by persons who do not have a legally trained mind and are entrusted in discharging functions affecting huge revenues - The order dated 30.1.2020 passed by the Assistant Commissioner rejecting the application of the petitioner is wholly arbitrary and demonstrates the lack of legally trained mind as there appears to be no effort to verify the correctness of the assertions made by the petitioner at the end of the Department - Bench is   sorry to record that the appellate authority has also committed the same manifest arbitrariness in deciding the appeal, the recording of the reason that facts cannot be verified at the appellate level is wholly arbitrary and militates against the whole purpose of statutory appeal under an enactment - Callous attitude of the Department has resulted in the assessee being harassed by approaching one forum after the other and wasting his considerable financial resources as well as time - Considering the fact that now the Department has accepted that the returns were filed within time and no dues remain payable, the order dated 30.11.2019 as well as the appellate order dated 06.07.2020 deserves to be set aside with a direction to allow the application for revocation of registration filed by the petitioner -  Consequently, the order cancelling the registration stands revoked from the date of filing of the application before the respondent no. 2 - Since the petitioner was unnecessarily harassed, the writ petition is allowed with a cost of Rs.10,000/- to be paid to the petitioner within 30 days by the respondent no. 2 from his own salary - Writ petition is allowed: High Court 

- Petition allowed : ALLAHABAD HIGH COURT

2020-TIOL-2106-HC-RAJ-GST

Aditya Gupta Vs UoI

GST - Petitioner seeks regular bail for offences u/s 132 of the Act, 2017 - Petitioner is in custody since 20.06.2018 and the maximum punishment that can be awarded is sentence of five years; that the case is listed for pre-charge evidence before the trial court and statement of fifteen witnesses out of forty-five prosecution witnesses have been recorded so far and there is no possibility of conclusion of trial at an early date - Counsel for Revenue submits that investigation has revealed that the accused had committed a fraud of Rs.22 crores by creating fictitious firms and had claimed ITC credit.

Held: Although in the present case, allegations levelled against the petitioner are serious in nature but the fact remains that the petitioner is in custody for the last more than two years and admittedly maximum punishment to be imposed on the accused, if convicted, is five years - Case is listed before the trial court for recording of pre-charge evidence and the trial may not be concluded at an early date, therefore, considering the custody period of the petitioner but without commenting on the merits of the case, the Court finds it just and expedient to order release of the petitioner on bail - Petition is allowed and petitioner is admitted to bail subject to furnishing a bail bond in the sum of Rs. 10 lakhs with one surety in the like amount to the satisfaction of the  trial court: High Court

- Petition allowed : RAJASTHAN HIGH COURT

2020-TIOL-2105-HC-ALL-GST

Ranchi Carrying Corporation Vs State of UP

GST - Petitioner seeks quashing of order dated 05.08.2020 passed u/s 130 of the CGST Act, 2017; the order dated 23.01.2020 in Form GST MOV-09 and the proceedings initiated u/s 129, 130 of the Act - Petitioner submits that none of the notices as required to be served u/s 129 have been served upon the petitioner and, therefore, the proceedings initiated and concluded against the petitioner are ex-parte proceedings - Counsel for the Revenue submits that the order dated 06.01.2020 was got served on the driver of the truck in question and secondly the order MOV-06 and MOV-07 was also served on the driver of the truck and as regards the order dated 23.01.2020, MOV-09 was neither served on the driver nor the owner and was served through fixation on the truck in question; that section 169 of the Act provides for manner of service of notice in certain circumstances; that the service on the driver or a fixation of the copy of the order on the truck is none of the methods prescribed and thus the orders were never served and the proceedings were held ex-parte.

Held:   A perusal of the provisions of Section 169 makes it clear that a manner is specifically provided for service of notices - It is well settled that whenever a manner is prescribed, the thing should be done in that manner alone - A perusal of the impugned order shows that at no point of time was the petitioner granted an opportunity of submitting his reply and the grounds taken by the petitioner before the Appellate Authority were not considered recording them to be an afterthought - Thus, on a plain reading, a failure of natural justice has been occasioned to the petitioner - Accordingly, the order dated 5.8.2020 and the order dated 23.1.2020 are set aside with a liberty to the respondents to conclude proceedings against the petitioner, in accordance with law - As the notices have now been served upon the petitioner, the petitioner shall file a fresh reply to the same within a period of three weeks and the respondents shall pass fresh orders, as expeditiously as possible, preferably within a period of four weeks - Petition disposed of: High Court

- Petition disposed of : ALLAHABAD HIGH COURT

2020-TIOL-290-AAR-GST

HP Tourism Development Board

GST - Applicant submitted that the Government of Himachal Pradesh, Department of Tourism agreed to credit amounts to Tourism Development Board (in lieu of grant) for smooth functioning of the Board viz. receipts of amount from sale of publicity material/literature books; free from parking lots and public places of convenience built by the Tourism department/adventure sports fee including heli-skiing and para-gliding fee etc.; 25% to be contributed by the Tourism Development Council from their resources; donation/grants received specially for tourism promotion/development; annual license fee and success fee received by the department from BOOT/BOT basic projects - applicant submits that the amount received is simply credited in the account of Tourism Development Board and is not 'receipts' within the meaning of the goods and services tax laws but purely a grant-in-aid by the Government to the Board as subsisting fund - applicant has, therefore, sought an advance ruling in the matter.

Held: HP Tourism Development Board fulfils the criterion laid down for being called as a 'Government entity' as per notification 32/2017-CTR because it has been established by the Government with 100% control to carry out the function of promotion and regulation of tourism activities in the State - Therefore, the amount credited in favour of HP Tourism Development Board by the Department of Tourism, Govt. of HP as grant-in-aid or financial assistance is exempt from GST as per Serial No. 9C of 32/2017-CTR: AAR

-Application disposed of : AUTHORITY FOR ADVANCE RULING

2020-TIOL-289-AAR-GST

Aditya Industries

GST - Applicant seeks an advance ruling in respect of the following questions viz.  Whether the input tax credit availed by the applicant is subject to rejection solely on the ground that the tax collected by the supplier of the raw material from the applicant is not paid to the government in cash & Whether the input tax credit availed by the applicant is subject to rejection solely on the ground that the tax collected by the supplier of the raw material from the applicant is paid to the government through utilisation of ineligible input tax credit - Said questions were later amended so as to incorporate reference to GSTR 2A of the applicant.

Held: All the cases pertain to a scenario where tax has not actually been paid - Even in cases where tax has been paid by the supplier to the government through in-eligible input tax credit it would always deemed not to have been paid as tax has not actually been paid to the government - When the applicant is sure as is evident in the application that tax has not been paid in cash or has been paid through ineligible input tax credit, it clearly implies that either tax has not been paid or deemed not to have been paid - It cannot, therefore, be regarded as tax paid to the government by any stretch of mind - In view of the provisions laid down in section 97(2) of the CGST Act, 2017 encompassing the specific questions, which are sought under advance ruling, it can decisively be inferred that the questions raised by the respondent before Advance Ruling Authority were beyond the scope and jurisdiction of Advance Ruling, and hence do not warrant any ruling thereon - subject application filed for advance ruling is rejected as being non-maintainable: AAR

-Application rejected : AUTHORITY FOR ADVANCE RULING

2020-TIOL-2096-HC-KERALA-VAT

Coastal Tiles & Sanitaries Vs STO

Whether assessee should opt for settlement of the arrears for AY 2012-13 also even if it FAA has already passed order in assessee's favour - YES : HC

Whether it is complusory for assessee to apply for settlement of arrears in respect of all AYs where arrears are outstanding - YES : HC

- Assessee's writ petition dismissed: KERALA HIGH COURT

Raju Laxman Pachhapure Vs UoI

CX - 2nd Respondent after carrying out investigation, recorded statements, obtained further necessary information and on conclusion of the investigation, issued a show cause notice dated 4.4.2018 to the petitioners demanding the payment of excise duty from the petitioners, jointly and severally for the period February, 2013 to September, 2014 and from April, 2015 to August, 2015 under the provisions of Rule 17(2) of the Pan Masala Rules read with section 3A of the Central Excise Act, 1944 - Petitioner replied to the SCN vide reply dated 10.7.2019, where a specific request for cross examination of the FDA Officers and the police officers who had drawn the above referred panchnama(s) was made, which was rejected by the 2nd respondent vide its letter dated 15.7.2019 - Subsequently on 21.8.2019, Respondent no.2 passed the impugned order in original whereby demand of excise duty to the tune of Rs.59,60,53,224 was confirmed against the petitioners along with equivalent penalty under Rule 26 of the Central Excise Rules, 2002 - It is the case of the petitioner that the impugned order has been passed without affording an opportunity to the petitioners to cross examine the Investigating Officers which is in contravention of the provisions of the Excise Act, besides being arbitrary, illegal, perverse, without and/or in excess of jurisdiction and in gross violation of the principles of natural justice – Petitioner also seeks a declaration that the provisions of Rule 17(2) of the Pan Masala Packing Machines (Capacity, Determination and Collection of Duty) Rules, 2008 (the "Pan Masala Rules") is ultra vires the provisions of Section 3A of the Central Excise Act, 1944 and is unconstitutional.

Held: Bench is not persuaded to invoke its writ jurisdiction at this stage as it is of the considered opinion that the alternative remedy of appeal is efficacious and the reason given for not invoking the same i.e. pre-deposit being burdensome does not appeal to it (Bench) -Accordingly, the petitioners are relegated to the remedy available under the Act by way of appeal - Bench also observes that in the facts of the case, challenge to the vires of Rule 17(2) of the Pan Masala Rules is rather without substance and, therefore, Bench does not consider it necessary to deal with the same in this case - Accordingly, both the petitions are dismissed leaving all contentions open to be agitated before the appellate forum: High Court [para 13, 14, 15]

- Petitions dismissed: BOMBAY HIGH COURT

2020-TIOL-2109-HC-MAD-CUS

PR CC Vs Palaniappan

Cus - Review Applicants cannot re-argue the Writ Petition in the guise of Review Application - The Review Applicants are not in a position to point out any error apparent on the face of the record to entertain the Review Application - Since there is no error apparent on the face of the record warranting interference in the Review Application, the Review Application is liable to be dismissed - Since this Court had already allowed the Writ Petition in W.P. No.2968 of 2016 and also dismissed the above Review Application, the impugned order dated 27.02.2016 is set aside and the matter is remitted back to the 2nd respondent for fresh consideration - The 2nd respondent is directed to issue notice to the petitioner and decide the matter afresh as expeditiously as possible, preferably, within a period of eight weeks - Review Application is dismissed and the Writ Petition in W.P.No.16483 of 2016 stands allowed: High Court [para 6, 10]

- Application dismissed/Petition allowed: MADRAS HIGH COURT

2020-TIOL-2108-HC-MUM-ST

Saksham Facility Services Pvt Ltd Vs UoI

ST - Facts are that Petitioner filed declaration in terms of the SVLDRS, 2019 on 24.11.2019 under the category "Investigation, Enquiry or Audit" under sub-categorization of "Investigation by DGGI" - It was mentioned therein that the quantified amount of service tax due was Rs.2,47,32,456.00 and Rs.1,20,60,000.00 was paid as pre-deposit - By the impugned order dated 01.03.2020 generated on 03.03.2020, the declaration of the petitioner was rejected on the ground of ineligibility - In the remarks given, it was mentioned that DGGI, Mumbai Zonal Unit in its verification report dated 25.01.2020 had informed that final quantification was not done before 30.06.2019 and thus the case of the petitioner fell under the exception clause of section 125(1)(e) of Chapter V of Finance (No.2) Act, 2019 - Aggrieved, the present petition has been filed - Petitioner seeks quashing of order dated 01.03.2020 whereby declaration of the petitioner dated 24.11.2019 under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 was rejected - Petitioner seeks a further direction to the respondents to consider afresh the aforesaid declaration as a valid one and thereafter grant consequential relief to the petitioner in terms of the said scheme.

Held: Bench finds that there is clear admission / acknowledgment by the petitioner about the service tax liability - The acknowledgment is dated 27.06.2019 i.e., before 30.06.2019 both in the form of letter by the petitioner as well as statement of its Director, Shri. Sanjay R. Shirke - In fact, on a pointed query by the Senior Intelligence Officer as to whether petitioner accepted and admitted the revised service tax liability of Rs.2,47,32,456.00, the Director in his statement had clearly admitted and accepted the said amount as the service tax liability for the period from 2015-16 up to June, 2017 with further clarification that an amount of Rs.1,20,60,000.00 was already paid - It is evident that the word 'quantified' under the scheme would mean a written communication of the amount of duty payable which will include a letter intimating duty demand or duty liability admitted by the person concerned during enquiry, investigation or audit or audit report and not necessarily the amount crystalized following adjudication - Thus, petitioner was eligible to file the declaration in terms of the scheme under the category of enquiry or investigation or audit as its service tax dues stood quantified before 30.06.2019 - Order dated 01.03.2020 is set aside and matter is remanded back to the Designated Committee to consider afresh the declaration of the petitioner dated 24.11.2019 as a valid declaration and grant the consequential relief after giving due opportunity of hearing to the petitioner who shall be informed about the date, time and place of the hearing - The entire exercise shall be carried out within a period of six weeks - Decisions in Thought Blurb [ 2020-TIOL-1813-HC-MUM-ST ] and M/s. G. R. Palle Electricals [ 2020-TIOL-2031-HC-MUM-ST ] relied upon - Writ petition is accordingly allowed: High Court [para 23, 26, 29, 30]

Respondent necessary party - In the affidavit of the respondents it is contended that petitioner did not make DGGI, Mumbai Zonal Unit a respondent in the writ petition and on this ground, relief should be declined - In the present proceeding, petitioner is concerned with rejection of its declaration under the scheme - The rejection is by the Designated Committee comprising of officers under respondent No.2 - Communications of the officials working under respondent No.2 with officials of DGGI is an internal matter on the basis of which the declaration of the petitioner was rejected - Thus, neither DGGI, Mumbai Zonal Unit nor any of its officials are necessary parties to the present proceeding - This objection is, therefore, without any substance: High Court [para 28]

- Petition allowed: BOMBAY HIGH COURT

2020-TIOL-1672-CESTAT-CHD

Saluja Motors Pvt Ltd Vs CCE & ST

ST - Commissioner(A) had directed the appellant to make pre-deposit and the same was complied with on 09.04.2010 - against the final order dated 23.07.2010 passed by Commissioner(A), appeal was filed before the Tribunal and the same was allowed on 05.09.2019 - On 04.11.2019, the adjudicating authority sanctioned the refund of the pre-deposit made earlier in terms of s.35F of the CEA, 1944 - however, since no ‘interest' was sanctioned, the present appeal is filed before the Tribunal.

Held:  CESTAT in the case of Modern Dairies Ltd. by Final Order no. 60413/2020 dt. 03.12.2020 has held that the assessee is entitled to claim interest on refund of the amount of pre-deposit in terms of s.35F of the CEA after three months from the date of communication of the order of the appellate authority till its realisation - Admittedly, in the present case, the refund claim was sanctioned on 04.11.2019 whereas the order of the Tribunal was passed on 05.09.2019 i.e. within three months, hence it is held that no interest is payable to the appellant - As the appeal has no merits, the same is dismissed: CESTAT [para 5, 6]

- Appeal dismissed: CHANDIGARH CESTAT

2020-TIOL-1671-CESTAT-BANG

Sap India Pvt Ltd Vs CST

ST - Assessee is engaged in importing of software and selling the same in India and also providing software maintenance service - They incurs expenses in foreign exchange - Pursuant to audit, it appeared to Revenue that assessee had not discharged their service tax properly and accordingly, service tax was not paid - As regards the first issue of Maintenance and Repair Service relating to software, the issue is no longer res integra and the said issue was decided in assessee's own case by coordinate Bench of Tribunal in 2010-TIOL-1569-CESTAT-BANG - In view of the precedent order, we find that this issue is squarely covered in favour of assessee - Next issue is regarding Business Support Services - It is with respect to using of dedicated leased line provided by overseas service provider - Issue is also settled in favour of assessee as has been held by co-ordinate Bench in TCS E-Serve Ltd. 2013-TIOL-2361-CESTAT-MUM , that for eligibility, the service provider has to be a 'Telegraph Authority' as defined in Section 65(105)(zzzx) of the Finance Act - Further, as per CBEC instructions F.No.137/21/2011 , the service tax shall not be payable where service is provided by foreign vendor and such foreign vendor is not the 'Telegraph Authority' under the Indian Telegraph Act - Next issue is regarding engagement of overseas agency by assessee for advertising and sales promotion outside India - This Tribunal in case of Genom Biotech Pvt. Ltd. 2016-TIOL-529-CESTAT-MUM has held that the assessee had availed advertising agency services through overseas service providers for providing advertisement and sales promotion service in territory of Ukraine, the appellant was manufacturers of trucks which was exported to Ukraine - The Tribunal held that the services that are not connected with the manufacture or with the transport of goods till the customs frontier of the country, can be disassociated from use within the country and hence would not lie within the ambit of legal fiction of import of services - Accordingly, this issue is also decided in favour of assessee - Thus, the impugned orders in both these appeals are set aside: CESTAT

- Appeals allowed: BANGALORE CESTAT

2020-TIOL-1670-CESTAT-MUM

Fast Forward Vs CC

Cus - Proceedings were initiated against assessee, a CHA, for having enabled the utilization of license issued to them by another person for handling of a fraudulent export consignment and on conclusion of statutory prescriptions, the impugned order held penalty of forfeiture as proportionate to the gravity of offence - The licensee is in appeal against that detriment - The appeal of CHA has not advanced any plea of breach of procedure laid down in CHALR, 2003 - Nor is there any submission that the principles of natural justice have been denied to them - There is a clear finding of licensing authority that the 'custom house agent', though dealing with the exporter for a long time, had failed to maintain the authority letter which was required to be obtained for each job undertaken - No reason found to accept the plea of licencee for setting aside the penalty - Had the general provision of appellate jurisdiction in Customs Act, 1962 sufficed, this specific enablement would not have been necessary - By enabling appellate jurisdiction through the power to frame regulations under section 146 of Customs Act, 1962, which is conspicuously absent in the general power to frame rules and regulations under section 156 and 157 of Customs Act, 1962, not only is a separate framework contemplated but also limited the recourse only to the licensee: CESTAT

- Appeal disposed of: MUMBAI CESTAT