2021-TIOL-91-SC-IT-LB

CBDT Vs Tata Teleservices Ltd

In writ, the Larger Bench of the Supreme Court observes that the SLP pertains to pre-assessment stage & that the assessment is now over. Hence it finds that the present petitions have become infructuous.

- SLP disposed of: SUPREME COURT OF INDIA

2021-TIOL-90-SC-IT-LB

UoI Vs Prabir Kumar Shaw

In writ, the Larger Bench of the Supreme Court directs that notice be issued to the parties and that the matter be tagged with SLP (Crl) D. No. 7377/2019.

- Notice issued: SUPREME COURT OF INDIA

2021-TIOL-89-SC-IT-LB

CIT Vs Moser Baer India Ltd

On appeal, the Larger Bench of the Supreme Court observes that even if the Revenue was to succeed in its appeal, the assessee is not in a position to pay the outstanding tax dues. The Court also considers the tax value involved and deems it appropriate to dispose off the present appeals, leaving the question of law open.

- Revenue's appeals disposed of: SUPREME COURT OF INDIA

2021-TIOL-231-HC-MAD-IT

CV Ravi Vs ITO

Whether failure of Assessee to establish identity of Creditor and genuineness of loan transaction, including capacity of person for giving loan for specified purpose would attract addition u/s 68 – YES: HC

- Assessee's appeal dismissed: MADRAS HIGH COURT

2021-TIOL-205-ITAT-MUM

ITO Vs Parth Traders

2021-TIOL-204-ITAT-MUM

DCIT Vs Evonik Catalysts India Pvt Ltd

On appeal, the High Court acknowledges the assessee's request to seek settlement of the matter under the Direct Tax Vivad Se Vishwas Scheme 2020. Hence it finds no reason to keep the present appeal pending. Nonetheless, the Court also gives liberty to the Revenue to file application for restoration of its appeal in case the assessee does not opt for settlement under the Scheme as contemplated by it.

- Assessees appeal disposed of : MUMBAI ITAT

2021-TIOL-203-ITAT-MUM

Empire Infraspace India Pvt Ltd Vs ACIT

Whether the rental value of the premises is not liable to be assessed on the percentage basis of the value of the property as property has been vacant in the relevant year - YES : ITAT

- Assessee's appeal allowed: MUMBAI ITAT

2021-TIOL-202-ITAT-MUM

Amrita Ramesh Kasbekar Vs ACIT

Whether it is fit case for remand where the assessee puts forth documentary evidence to prove genuineness of agricultural income earned, but where such evidence is not examined by the AO - YES: ITAT

- Case remanded: MUMBAI ITAT

2021-TIOL-201-ITAT-AHM

Amitaben Kanjibhai Patel Vs ITO

Whether power of rectification of mistake can be exercised only when such mistake is an obvious & patent mistake which is not required to be established by argument or long drawn reasoning - YES: ITAT

Whether an assessee can stave off re-assessment proceedings, where entirely different facts are presented before the AO and the CIT(A) & where the assessee is unable to establish any claims through tangible evidence - NO: ITAT

- Assessees application dismissed/In favor of Revenue : AHMEDABAD ITAT

2021-TIOL-239-HC-AHM-GST

Gujarat Automation Vs Deputy Commissioner of State Tax

GST - s.139 of the CGST Act, 2017 - Pursuant to the enactment of the CGST Act, 2017 every person registered under any of the then existing laws and having a valid Permanent Account Number was required to be issued a certificate of registration under the new Act – Accordingly, taking into consideration the registration of the writ-applicant under the Value Added Tax, he was issued the GSTIN - It appears that the problem for the writ-applicant cropped up as regards activating the GSTIN as the registration under the Value Added Tax came to be cancelled w.e.f. 30.06.2016 - Writ-applicant being dissatisfied with such decision cancelling the registration under the Value Added Tax Act preferred an appeal before the appellate authority and the said appeal came to be allowed vide order dated 04.07.2018 – Consequently, as the appeal came to be allowed, the registration of the writ-applicant came to be revived w.e.f. 30.06.2016 and, therefore, the GSTIN should have made the registration operational and active which is not currently – Petition filed.

Held: Over a period of time, many representations were preferred by the writ-applicant as regards the subject matter, but of no avail – Bench, therefore, disposes of this writ-application with a direction to the respondent no.2 [Council] to take up the matter of the writ-applicant at the earliest and see to it that the GSTIN is activated and made operational - appropriate order shall be passed within a period of one week - writ-application stands disposed of: High Court [para 10 to 12]

-Application disposed of : GUJARAT HIGH COURT

2021-TIOL-238-HC-AHM-GST

Diesel World Pvt Ltd Vs UoI

GST - It is the case of the writ applicant that upon export of goods against a letter of undertaking without payment of tax, it was entitled to refund of the unutilized Input Tax Credit under Section 54(3) of the Act, 2017 - Accordingly, the writ applicant filed an application for refund for the period between September 2017 and March 2018 - It appears that the writ applicant first utilized the balance of the CGST, SGST and thereafter, the IGST. The refund was sanctioned by the respondent No.3 - This refund amount is now sought to be recovered from the writ applicant on the premise that the writ applicant could not have utilized the CGST and SGST balance first - inasmuch as the writ applicant ought to have debited the IGST first - Therefore, SCN dated 24th December 2020 issued by the respondent No.3 under Section 74 of the Act, 2017 - Petitioner submits that by applying the Circular 59/33/2018-GST dated 4th September 2018, more particularly, the para 3.2 therein with retrospective effect is wholly without jurisdiction; that the impugned Circular, which lays down the order of debiting the electronic credit ledger, is ultra vires the provisions of the GST and the Rules made thereunder; that if the department is of the view that the refund was wrongly availed and sanctioned, then it should prefer an appeal and not issue a show cause notice under Section 74 of the Act - reliance placed on the Tripura High Court decision in Tripura Ispat - 2021-TIOL-146-HC-TRIPURA-CX .

Held: Notice to be issued to the respondents, returnable on 2nd March 2021 - ad interim relief granted in terms of para 23(D) of writ application: High Court [para 5]

-Ad Interim relief granted: GUJARAT HIGH COURT

2021-TIOL-236-HC-ORISSA-CT

Mohanilal @ Mohanlal Sitani Vs State Of Orissa

Whether exemption from taxation granted to sale of firewood can be extended to sale of firewood to be used as raw material for manufacturing of paper - NO: HC

Petition dismissed : ORISSA HIGH COURT

2021-TIOL-88-SC-CX-LB

CCE & ST Vs S K Samanta And Company Pvt Ltd

CX - Revenue has filed appeals against orders of the CESTAT with a delay of 668 days, 727 days and 668 days, respectively - Counsel for Revenue submits that the delay occurred on account of the fact that the appeals were mistakenly filed before the Calcutta High Court.

Held: [para 3 to 5]

+ Even if the period of time which was spent in pursuing the appeals before the High Court is excluded, there is still a substantial and unexplained delay.

+ Bench is of the view that the Union of India, which has competent legal advice at its command, cannot, particularly in the facts of the present case, be heard to contend that they were under a mis-apprehension that the appeals would lie before the High Court.

+ Nature of the controversy involved in the appeals leaves no manner of doubt, that the appeals were maintainable before this Court and this Court alone.

+ Bench is not inclined to condone such a gross delay on the part of the Revenue in accessing its remedies before the court.

+ Certainty in fiscal matters is of importance to the assessee just as the interests of the Revenue have to be duly protected. The concerns of the Revenue have to be duly met by showing alacrity in pursuing remedies which are available in law.

+ Appeals are accordingly dismissed on the ground of delay: Supreme Court Larger Bench

- Appeals dismissed :SUPREME COURT OF INDIA

2021-TIOL-237-HC-MUM-ST

Kiran Gems Pvt Ltd Vs UoI

ST - Petition has been filed under the provisions of Articles 226 and 227 of the Constitution of India by the petitioner, Kiran Gems Private Limited, a private limited company, seeking quashing of notice / intimation dated 10.01.2019 issued by Superintendent, Range-III, CGST, Division IV, Mumbai East, inter alia, intimating that petitioner's case has been selected for scrutiny / audit by LAP-XII CERA (GSTA) for the period January 2019 to March 2019 and to submit information / records for the period 2015-16 to 2017-18 to the officers of CERA for audit. Petitioner's primary assertion is that the impugned notice / intimation seeking audit of petitioner's accounts is without jurisdiction i.e it has been issued without invoking the provisions of statutory laws under which a special audit, as purported, can be conducted. The period for which the accounts are sought to be audited appear differently in the covering letter and the annexure to the intimation letter. There is no enabling statutory provision available to the respondents to seek information pertaining to pre and post GST era for CERA audit from a private entity; such action suffers from a jurisdictional error since power to audit being a statutory power traceable to the relevant statute being absent in the present case. In the affidavit-in-reply respondents have contended that power to conduct CERA audit has been invoked under the provisions of Section 16 of the Comptroller and Auditor General's (Duties, Powers and Conditions of Service, Act 1971 (for short ‘the CAG's (DPC) Act'); the said section cannot apply to a private entity as the said Act provides for audit by the Comptroller and Auditor General of India (for short ‘the CAG') of all receipts which are payable into the Consolidated Fund of India and of each State and each Union Territory. This contention of respondents is challenged by the petitioner on the ground of lack of inherent jurisdiction being not available to the respondents to invoke the provisions of Section 16 of the CAG's (DPC) Act in the petitioner's case. Held: + It is crystal clear [upon reading the provisions of s.72A of the FA, 1994 and rule 5A of STR, 1994] that in case of a private assessee, Commissioner will refer the matter to an officer to collect the material or Chartered Accountant for the purpose of audit. Thus, for the purpose of audit, material can be collected either by the officer authorized by the Commissioner or by the auditor himself. But, audit will be performed only by the Chartered Accountant. It is the pious duty of the assessee to make available the record as mentioned in Rule 5A i.e. trial balance or its equivalent; and the Income-tax audit report, if any, under Section 142(2A) of the Income Tax Act, 1961, for the scrutiny of the officer or the audit party, as the case may be. - In the present case the impugned notice / intimation dated 10.01.2019 seeking audit of petitioner's accounts is not contemplated under the provisions of Rule 5A of the Service Tax Rules, 1994. On the contrary, it is the assertion of the respondents that these have been issued under section 16 of CAG's (DPC) Act. + The question involved is whether CERA, an audit wing of the Principal Director of Audit (Control), Kolkata under the CAG, has power to and / or authority and / or jurisdiction to audit the account, of the petitioner company under Section 16 of the CAG's (DPC) Act, where admitedly the petitioner company is not an undertaking of the Central Government or of any State Government and is purely a private entity. + The impugned notice / intimation dated 10.01.2019 calling on the petitioner to submit its records to the officers of CERA for audit will have to be considered with reference to the above provisions of the CAG's (DPC) Act. The CAG's (DPC) Act is enacted to determine and prescribe duties and powers of the CAG and for matters connected or incidental thereto. The scheme of chapter III prescribes the duties and powers of the CAG. + It is clearly discernible that the power of the CAG under Chapter III extends to any office or department of the Government and cannot be construed to extend to a private entity. The provisions of Chapter III envisage that for the purpose of audit it shall be the duty of the CAG to conduct audit of the receipts payable into the Consolidated Fund of India of the Union or a State as applicable and to put such questions or make such observances as the CAG may consider necessary to the person in-charge of the office or to call for such information as required for preparation of any account or report pertaining to the Government office or department concerned. This scheme clearly concludes that the CAG cannot have jurisdiction to audit the accounts of a private entity directly. + Submission of the petitioner that the Central Goods and Services Tax Act, 2017 has no provision empowering CERA to conduct audit of the petitioner's records also merits acceptance. Brief perusal of the annexure to the impugned communication reveals that detailed audit of the petitioner's accounts and records is sought for the period 2015-16 to 2017-18 i.e. for a period of three years by respondent No.3. Such a detailed audit can only be called for under relevant and specific statutes. It is settled law that jurisdiction goes to the root of a matter and power of any authority invoking such jurisdiction to call for special audit needs to be traceable to the relevant statutory provision. In the absence of statutory backing, such an exercise of power would be invalid and non est. In the present case, the impugned notice / letter dated 10.01.2019 calls for CERA audit and respondents in their affidavit-in-reply have relied on the provisions of Section 16 of the CAG's (DPC) Act to justify the impugned communication. If that be the case then as discussed hereinabove, the respondent's action is wholly without jurisdiction and unconstitutional. + Case of the respondents in the affidavit-in-reply that the impugned communication has been issued under the provisions of Section 16 of the CAG's (DPC) Act and that CERA is authorized to extend the audit exercise to the petitioner's accounts, therefore, deserves to be rejected for want of jurisdiction and statutory authority. Case of the respondents that CERA is authorised to conduct the audit of the department and as part of the said audit, examination of the records of the private company can be examined to ascertain whether the Government is getting its due share by way of indirect taxes deposited by the private company and therefore private company is bound to provide all records and documents called for by CERA deserves to be rejected looking at the scheme of Chapter III. + It is clear that the statutory responsibility of the CAG is to audit receipts of the Union and States. It is duty of the Central Excise Revenue Audit (CERA) to see that sums due to the Government are properly assessed, realized and credited to the Government account. The scheme enacted and envisaged in Chapter III of the CAG's (DPC) Act, 1971 begins with the word "Comptroller or Auditor General to compile accounts of Union and or States." + It is in such context that the provisions of Section 16 pertaining to audit of all receipts which are payable into the Consolidated Fund of India and each State and of each Union Territory is required to be construed with respect to the accounts maintained in the Government departments / Corporations belonging to the Government. + Mandate of Section 16 of the CAG'S (DPC) Act, 1971, CERA audit cannot be extended to call for audit of a private entity such as the petitioner company. + Writ petition is allowed in terms of prayer clause (a) which reads - (a) that this Hon'ble Court be pleased to issue a Writ of Certiorari or a writ in the nature of Certiorari or any other writ, order or direction under Article 226 of the Constitution of India calling for the records pertaining to the Petitioner case and after going into the validity and legality thereof quash impugned letter F.no. GST/ME/Dn.IV/R.III/CERA- AUDIT/61/18 dated 10.01.2019 Exhibit :- ‘A' along with annexure issued by the Respondent 3." [para 13 to 15, 17 to 19, 22 to 24] + Calcutta High Court decision in SKP Securities Ltd Vs. Deputy Director (Ra-IDT) - 2013-TIOL-38-HC-KOL-ST & Allahabad High Court decision in ACL Education Centre P Ltd. - 2014-TIOL-120-HC-ALL-ST relied upon [para 20, 21]

-Petition allowed : BOMBAY HIGH COURT

2021-TIOL-66-CESTAT-CHD

NK Impex India Vs CC

Cus - The appellants are in appeals against impugned orders wherein the request of provisional release of imported goods under Section 110 (A) of Customs Act, 1962 has been rejected alongwith applications for early hearing of appeals - As the facts in both the cases are little difference, therefore, the findings of each case is dealt separately - As regards to appeal of first appellant, it is a case in which the goods have been cleared for home consumption and with a direction to SIIB to investigate the country of origin and it was held by SIIB that country of origin is Kingdom of Saudi Arabia - Admittedly, the goods in question were cleared for home consumption, therefore, at the time of importation, assessment has been made after investigating the goods, in that circumstances, on mere presumption or on the basis of third party evidence, it creates doubts that the country of origin is not Kingdom of Saudi Arabia - Therefore, the goods are required to be provisionally released under Section 110 (A) of Customs Act, 1962 by putting reasonable condition for release of goods - Matter is remanded back to the adjudicating authority to re-consider the request of provisional release of impugned goods in judicious manner as the goods are in perishable nature.

As regards to appeal of second appellant, the goods have been seized at port itself on the premise that the goods in question are having origin of Phytosanitary Certificate and it is a matter of investigation - Further, it has also alleged that the appellant has failed to produce the attested copy of Phytosanitary Certificate from country of origin, therefore, the Phytosanitary Certificate for re-export is required to be examined - The said certificate itself clearly states that the goods in question are originated from Kingdom of Saudi Arabia - The appellant has complied with substantial condition of Plant Quarantine Order 2003 - Keeping in mind that the goods are of perishable nature, the request for provisional release under Section 110 (A) of impugned goods is required to be considered by adjudicating authority taking the view of the same in similar type of situation in the case of other importers, therefore, the matter is remanded back to the adjudicating authority to re-consider the request of provisional release of impugned goods in judicious manner: CESTAT

- Matter remanded: CHANDIGARH CESTAT

2021-TIOL-65-CESTAT-KOL

Rashmi Metaliks Ltd Vs CCGST & CE

CX - A SCN was issued proposing recovery of duty not paid during the period 2011-12 & 2012-13 due to clandestine removal and under valuation, with interest, under Sections 11A(4) and 11AA of the Act; proposing imposition of equal amount as penalty on appellant under Section 11AC of the Act and proposing imposition of penalty, under Rule 26 of Central Excise Rules, 2002, on the directors/ employees of company - Investigation was initiated in January 2013 and the SCN came to be issued in September 2016 - While the SCN was issued in September 2016, appellants were not provided with Relied Upon Documents/ Non-Relied Upon Documents completely or in even time; the appellants were denied a right that was available to them as per Rule 24A of Central Excise Rules, 2002 and CBEC instructions contained in Circular No. 171/5/96-CX.6 , Instruction No. 207/09 /2006-CX.6 and Circular No. 42/88-CX.6 - Therefore, they were not given opportunity to represent themselves - This is a clear case of not following principles of natural justice - However, the lapse on the part of Revenue is a curable defect - In the interest of Justice, reasonable opportunity needs to be given to Revenue to cure the defect and to conduct the adjudication adhering to the principles of natural Justice - Such an opportunity is only possible when the case is remanded back to adjudicating authority so that the defects are cured and rectified and an opportunity is given to respondents to file a reply and to attend the personal hearing - Tribunal cannot set aside the order for curable defects and more so when huge evasion of duty is alleged - Neither the Appellants and nor the Department have submitted anything in their defence as far as the merits of the case are concerned - The only course available is to send the case back to the adjudicating authority for passing the order after curing the defects i.e. after observing principles of natural justice in letter and spirit - The appeals are allowed by way of remand to the adjudicating authority for de novo consideration after observing the principles of natural justice - The concerned authorities are directed to make available documents/copies, a request for which is already made, to the appellants: CESTAT

- Matter remanded: KOLKATA CESTAT