2021-TIOL-NEWS-068, Dated:Monday, March 22, 2021

2021-TIOL-NEWS-068| March 22 2021

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INCOME TAX


	2021-TIOL-672-HC-AHM-IT Nikeshkumar Bhupendrabhai Shah Vs UoI Whether the High Court is obliged to look into merits of a petition, where the assessee-petitioner has an equally efficacious alternate remedy of appeal available with it - NO: HC -Writ petition disposed of : GUJARAT HIGH COURT 2021-TIOL-671-HC-MAD-IT CIT Vs Salem Sengunthar Welfare Trust Whether as per Section 12A(1), registration of a trust can be done from the first day of the FY in which the application is made & cannot be done retrospectively - YES: HC -Revenue's appeal disposed of :MADRAS HIGH COURT 2021-TIOL-670-HC-MAD-IT Government Telecommunications Employees Cooperative Society Ltd Vs ACIT On appeal, the High Court finds that issues identical to those raised in the present appeal, have already been settled in favor of the assessee, vide the assessee's own case for a different period. Hence the present appeal is disposed off accordingly. -Assessee's appeal allowed :MADRAS HIGH COURT 2021-TIOL-550-ITAT-DEL Gdx Facility and Management Services Pvt Ltd Vs DCIT Whether employees contribution to ESI and PF deposited beyond due date prescribed under relevant Acts but before due date of filing of return can be disallowed - NO: ITAT - Assessee's appeal allowed: DELHI ITAT 2021-TIOL-549-ITAT-AHM Madhu Silica Pvt Ltd Vs ACIT Whether interest expenses can be disallowed when assessee has substantial amount of interest free fund - NO: ITAT Whether disallowance of donation paid can be made without giving the opportunity of cross examination - NO: ITAT - Assessee's appeal partly allowed: AHMEDABAD ITAT 2021-TIOL-548-ITAT-AHM DCIT Vs Ganesh Plantation Ltd Whether reopening of assessment can be made on the basis of same set facts which were considered during the original assessment - NO: ITAT Whether losses on the purchase and sales of shares can be disllallowed, when assessee has sufficiently discharged his burden of proof - NO: ITAT - Revenue's appeal dismissed: AHMEDABAD ITAT 2021-TIOL-547-ITAT-BANG SKF Engineering And Lubrication India Pvt Ltd Vs ACIT Whether amounts contributed to the Scheme formulated by LIC of India towards superannuation fund can be allowed as business expenditure - YES: ITAT - Assessee's appeal allowed: BANGALORE ITAT 2021-TIOL-546-ITAT-CHD DCIT Vs Apeejay Education Society Whether benefit u/s 11 and registeration u/s 12AA can be cancelled merely on the statement of third person that there is a accomodation entry of the business expenditure - NO: ITAT - Revenue's appeal dismissed: CHANDIGARH ITAT

GST CASE


	2021-TIOL-674-HC-DEL-GST Mridul Tobie Inc Vs Additional Director General Directorate General of Goods and Service Tax Intelligence GST - One of the issues which the Court had flagged was that issues raised in the instant writ petition overlapped with issues that had been raised by the petitioner in the writ petition filed before the Allahabad High Court; that therefore, the Court had indicated, on that date, that the best course of action, perhaps, would be that the petitioner be relegated to the Allahabad High Court - Record shows that search has been carried out not only by the Gautam Budh Nagar Commissionerate but also by various Intelligence Units, i.e., DGGI Regional Unit Kanpur, DGGI Zonal Unit Delhi, DGGI Regional Unit Ghaziabad and DGGI Ahmedabad Zonal Unit on various dates - Petitioner submits that repeated searches, not only by Gautam Budh Nagar Commissionerate, but also by other Intelligence Units, are completely oppressive and in fact, the most recent search carried out at the residential premises of the proprietor was a case of breach of invasion of privacy. -Matter listed : DELHI HIGH COURT 2021-TIOL-673-HC-DEL-GST Bharatiya Vitta Salahkar Samiti Vs UoI GST - Constitution of GST Appellate Tribunal - Petitioner has challenged s.109 of the CGST Act as being ultra vires; sought a direction to the respondents to not take steps for appointment and/or constitution of GSTAT - It appears that the Madras High Court has struck down Sections 109(3) and 109(9) of the Central Goods and Services Tax Act, 2017 -Counsel for Revenue informed that he is presently not aware as to whether or not any appeal has been lodged with the Supreme Court; that the matter has been placed before the GST Council for deliberation in the light of the observations made by this Court in the order dated 19.11.2019 = 2019-TIOL-2639-HC-DEL-GST Held : Bench is of the view that if no appeal has been preferred, then, unless the Bench takes a different view, the respondents would be bound by the directions contained in Revenue Bar Association -Counsel for Revenue will place on record an affidavit as to what decision, if any, has been taken by the GST Council on aspects referred to in the order dated 19.11.2019 and this affidavit is required to be filed before the next date of hearing - It is made clear that if no decision is taken, then, the matter will proceed for hearing - Matters to be listed on 13.05.2021: High Court [para 1.3, 2, 3] -Matter listed : DELHI HIGH COURT

MISC CASE


	2021-TIOL-669-HC-MAD-VAT Next IT World Vs Assistant Commissioner Whether pre-revision notices & subsequent orders passed are not sustainable if based solely on the report of Enforcement Wing officers & where the AO does not consider the matter from an independent perspective - YES: HC - Case remanded: MADRAS HIGH COURT

INDIRECT TAX

2021-TIOL-678-HC-AHM-ST

Sdb Diamond Bourse Vs UoI

ST - It appears that the writ-applicants received an advance of Rs.3.40 crore from the interested members during the Financial Year 2014-15 for acquiring office space in the proposed 'Diamond Bourse' constructed by the writ-applicant - Such amount received by the writ-applicants was required to be reported in the ST3 returns filed for the relevant period - However, as alleged, the receipt of the amount was suppressed in the ST3 returns for the relevant period - On the basis of the information as regards the evasion of tax, the HQ Anti Evasion Branch of Surat-I Commissionerate initiated investigation - Writ applicant sought quashing of the demand notice dated 22nd October 2019 issued by the respondent No. 4 but during the pendency of the petition, the SCN proceedings culminated in a final order passed by the Commissioner, Central Excise and CGST, Surat confirming demand of Rs . 24,67,98,056/- and appropriating the said amount already paid and imposing penalty etc. - It appears that after the search and seizure under Section 82 of the FA, 1994, the writ-applicants preferred an application before the Authority for Advance Ruling (AAR) on 21st June 2016 under Section 96(C) of the Act seeking a ruling as regards the taxability of the said service; that although the application was heard on 11th August 2017 by the Authority, yet till this date, no final order has been passed by the Authority; that, therefore, the impugned order passed by the Commissioner be quashed and set aside and the AAR may be directed to pass an appropriate order at the earliest in accordance with law.

Held: The only question that falls for consideration of the Bench is, whether it should interfere in the present writ-application - Counsel for Revenue is right to a certain extent that the issues raised by the writ-applicants before the ARA have been gone into by the Commissioner in the Order in Original - In other words, the Authority, in its order dated 16th July 2020, has adjudicated upon both the issues - In such circumstances, for all purposes, the application before the ARA has become academic and Bench should ask the Appellate Tribunal to hear the appeal preferred by the writ-applicants herein and decide the same expeditiously in accordance with law - Bench does not undermine the importance of Chapter XVII as pointed out by the Supreme Court [ 2020-TIOL-151-SC-IT ] - A vibrant system of advance ruling can go a long way in reducing the taxation litigations - However, in the matters of the present type, sometimes the delay at the end of the ARA may frustrate the investigation which may not be in the interest of the Revenue - In the aforesaid view of the matter, Bench has reached a conclusion that it should not interfere with the impugned order passed by the Commissioner only on the ground that he should have waited for the ruling of the ARA - In the peculiar facts and circumstances of the case, Bench declines to grant any relief to the writ-applicants and relegates them to pursue the appeal preferred by them, before the Tribunal - The Tribunal shall decide the appeal expeditiously in accordance with law without being influenced in any manner with any of the observations made by this Court in this order - Civil Application also stands disposed of: High Court [para 21, 28 to 30]

-Petition disposed of : GUJARAT HIGH COURT

2021-TIOL-677-HC-AHM-ST

Linde Engineering India Pvt Ltd Vs UoI

ST - Commissioner of CGST and Central Excise, Vadodara-1, confirmed the demand of service tax to the tune of Rs.113,53,62,269/- and a Writ application was filed in the year 2018 challenging this order - Coordinate Bench of this Court was prima facie persuaded to accept the argument that the appellate remedy provided under Section 35F of the Central Excise Act, 1944 read with the provisions of Section 86 of the Finance Act, 1994 mandates a pre-deposit of an amount equivalent to 7.50 % of the service tax demand subject to a maximum of Rs.10 crore and, therefore, is not an efficacious remedy – Also, a coordinate Bench of this Court by way of an ad-interim relief restrained the respondents from making any coercive recovery pursuant to the impugned order-in-original dated 31.10.2018 - A request is made on behalf of the respondents Revenue to adjourn this matter - Rule to be issued to the respondents, returnable on 10.06.2021 - Ad-interim relief, granted earlier, stands confirmed: High Court [para 3, 4]

-Matter posted : GUJARAT HIGH COURT

2021-TIOL-676-HC-KAR-ST

Aditya Builders and Developers Vs Addl.CCT & CE

ST - Petitioner seeks issuance of appropriate writ setting aside the impugned order dated 26.09.2019 - Petitioner submits that Section 65B(44) of the Finance Act, 1994 excludes the transaction of transfer of title in goods or immovable property and hence the order is one without jurisdiction - Petitioner fairly concedes that the order that has been passed is in the absence of any response to the notices issued by the authority.

Held : It is not in dispute that the petitioner has not responded to the show cause notices and hence, there has been some lapse on their side - Order has been passed without participation of the petitioner - Even if the petitioner were to prefer an appeal, the authority which has passed the order will have no benefit of the contentions on its merits as sought to be made out in the present writ petition - It would be an appropriate case to afford an opportunity for the petitioner to put forth his case on merits so that a reasoned order is passed by the Assessing Authority - Petitioner is directed to appear before the respondent on 08.03.2021 - petitioner undertakes that petitioner would not sell or create any encumbrance on the property till the conclusion of the proceedings - Attachment of the bank account is directed to be lifted while noting the undertaking - Petition disposed of: High Court [para 5, 6, 10, 11]

-Petition disposed of : KARNATAKA HIGH COURT

2021-TIOL-675-HC-MAD-CUS

CC Vs Pandithurai

Cus - First respondent brought assorted foreign currencies equivalent to Indian Rs.58,04,590/- - He was intercepted by the Air Intelligence Unit in Chennai when he was about to board the flight to Singapore - Order-in-Original dated 26.3.2004 came to be passed by the Adjudicating Authority wherein there was absolute confiscation of the foreign currencies and a sum of Rs.5 lakhs was imposed on the first respondent - In the first round of appeal, Tribunal directed the Adjudicating Authority to adjudicate the case afresh by allowing the first respondent to redeem the foreign currencies on payment of a reasonable fine to be determined by him after hearing the first respondent - On de novo consideration, again an Order-in-Original dated 26.12.2007 was passed by the Adjudicating Authority, by which, the first respondent was permitted to redeem the foreign currencies on payment of Rs.32 lakhs and a sum of Rs.5 lakhs was imposed as penalty - Once again, the first respondent approached the Tribunal and by the impugned order dated 30.3.2009, Tribunal modified the order dated 26.12.2007 passed by the Adjudicating Authority by reducing the fine to Rs.7.5 lakhs and the penalty to Rs.1 lakh - Aggrieved by this order, the Revenue is in appeal.

Held: The Adjudicating Authority passed the order dated 26.12.2007 by fixing the redemption fine at Rs.32 lakhs and levying penalty at Rs.5 lakhs - On appeal, the Tribunal took note of the earlier order passed by it wherein there was a direction to impose reasonable redemption fine and after taking note of its decision and having regard to the value of the goods, reduced the redemption fine as well as the penalty - Thus, Bench finds that the Tribunal exercised its discretion based on the direction issued by it in the earlier round of litigation and also taking note of its decision - Bench also finds that the entire matter is factual and there is no substantial question of law arising for consideration in this appeal - Civil miscellaneous appeal is dismissed: High Court [para 9 ]

-Appeal dismissed : MADRAS HIGH COURT

2021-TIOL-162-CESTAT-BANG

MRF Ltd Vs CC

Cus - The appellant is a three-star export house and once the largest exporters of tyres in India - The MEIS-Scheme was introduced in 2015 and the appellant filed shipping bills but by a procedural lapse in shipping bills in column for claiming the benefit of scheme instead of putting "Y" CHA inadvertently put "N" which is purely a procedural mistake - Further, in shipping bills, appellant has stated that they want to avail the benefit of MEIS-Scheme - The request of the appellant to issue NOC by Customs was denied vide impugned order by relying on the Circular dated 23.09.2010 of CBEC which is not applicable because that Circular relates to conversion of shipping bills from one export promotion scheme to another which is not the case in the present case - Rejection of request for issuing NOC is not sustainable in law and therefore, the impugned order is set aside and the authorities below are directed to issue NOC after verifying shipping bills as per the request of appellant on production of certified copy of this order: CESTAT - Appeal allowed: BANGALORE CESTAT

2021-TIOL-161-CESTAT-AHM

Ultratech Cement Ltd Vs CCE & ST

CX - The issue involved is that whether the appellant is entitled to Cenvat credit in respect of Dredging Services and Marine Consultancy Services provided by service provider for smooth navigation of vessels at private jetty which is used by appellant - There is absolutely no dispute that the appellant themselves are the service recipient - They borne the service charges along with service tax paid by service provider - The service was availed for smooth navigation of vessels at the private jetty - Therefore the service was indeed received by appellant and the same was used for their business purpose - The expenses of service was also borne by appellant which was not in dispute rather they have submitted an affidavit of service provider that the entire service charge was paid by appellant and no any amount was recovered from any other private jetty owner - As per Cenvat credit provisions, to allow Cenvat credit, the criteria is such as receipt of service, payment thereof made to the service provider along with service tax, use of service for business purpose - It is important to see that irrespective of such services have been provided anywhere but it is for the purpose of appellant and it is received by appellant - If that test is qualified then it cannot be said that the service was not received by appellant - In view of the judgment in Sanghi Industries Limited 2020-TIOL-328-CESTAT-AHM , credit of dredging service provided at the private jetty has been allowed - There is no reason to deny Cenvat credit in respect of Dredging and Marine Consultancy Service - Accordingly, the impugned order is set-aside: CESTAT

- Appeal allowed: AHMEDABAD CESTAT

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