2021-TIOL-1072-HC-AHM-GST

Anish Infracon India Pvt Ltd Vs UoI

GST - The petitioner received the SCN, which had been replied to in detail, which is in reference to the wrong availment of ITC - It is the grievance on the part of petitioner that summary notice in the form of GST/DRC/07 dated 06.01.2021 culminated into the physical summary order of FORM GST DRC-07 dated 18.02.2021 demanding a sum with specific direction to make the payment in 30 days - The petitioner has fairly pointed out the statutory provision of section 107 of CGVAT which provides for the appeal to the Appellate authority, if any person is aggrieved by decision or order passed under CGST Act or the SGST Act or the UTGST Act by the adjudicating authority, within three months - He, in the very breath, though has added that absence of detailed order is the hampering ground for petitioner to move such an appeal and on a query raised by this Court, he has no instructions as to whether the petitioner has sought for the reasoned order from the adjudicating authority in the State - Let the reasoned order, if not already supplied to the petitioner, be provided within 07 days - Such a copy of reasoned order shall be shared electronically within 24 hours on e-mail id provided here to the Petitioner - This disposal shall not come in the way of the petitioner in adjudicating all the issues, which are raised before this Court and the authority concerned also shall not hold adversely on this disposal of the petition, where the Court, only on the ground of alternative remedy, has chosen not to enter into the merits of the matters: HC

- Petition disposed of : GUJARAT HIGH COURT

2021-TIOL-1070-HC-AHM-GST

Gnana Prakash Moses Patric Raja Vs State of Gujarat

GST - Petition preferred under Articles 19 and 226 of the Constitution of India raising the grievance against the respondents for highhandedness of detaining the vehicle along with the goods at Songadh Post without following the due procedure of law - Order of detention under Section 129(1) of the CGST Act, 2017 under the Form GST MOV-06 is passed on the ground that the goods loaded could have been taken via other route which was shorter and instead 450 km long route has been taken via Gujarat and, therefore, there is possibility of delivery of the goods in Gujarat or to the nearer place to Gujarat; In the SCN grounds mentioned are, of the longer route and an additional ground of under valuation and detention of the driver - Petitioner submits that it was a choice of the transporter to take any of the three routes and it can never be the ground of suspicion much less of detention - That, this Court rendered in the case of Synergy Fertichem Pvt. Ltd., vs. State of Gujarat, Special Civil Application No. 4730 of 2019 and allied matters - 2019-TIOL-2950-HC-AHM-GST , wherein the Court has given the detailed guidelines as to what are the requirements before the authorities to exercise the powers of detention; that without following the guidelines, straightway notice is issued under Section 130 of the Act without any application of mind and without there being any foundation for issuance of such show cause notice.

Held: Bench deems it appropriate to relegate the petitioner to the officer concerned for adjudication of the show cause notice without entering into merits of the matter - SCN to be adjudicated on or before 30.4.2021 - Petitions disposed of: High Court [para 9 to 11]

- Petitions disposed of: GUJARAT HIGH COURT

2021-TIOL-1068-HC-MUM-GST

Krishna Murari Singh Vs UoI

GST - Petitioner challenges the validity of section 132(1)(b) and (c) of the Act, 2017 with declaration that the same is unconstitutional and further declaration that exercise of power under Section 69 of the CST Act would be only upon determination of liability and that petitioner's arrest is illegal - It is the case of the department that the petitioner is engaged in evasion of goods and services tax by collecting taxes and not paying the same to the government; is suppressing taxable value of supply for payment of tax and is availing Input Tax Credit ('ITC') on purchase of goods and services not received by him and in using ineligible credit for payment of taxes on their outward taxable supply; that the premises of GSTL were searched on 15/10/2020 and incriminating documents were seized under panchanama and it has been unearthed that the company has collected tax to the tune of Rs. 6.3 Crore but has not deposited with the government; that GSTL is engaged in clandestine supply of goods and services without payment of taxes and without accounting the same in the returns filed with the department; that from the documents retrieved, it has surfaced that GSTL has supplied goods and services to the tune of Rs.35 Crores and the same fact has been confirmed from one of the recipients and on the same Rs. 6.3 Crore tax is payable; that M/s. VRD Retail is a bogus company having a bogus director and his statement shows he is ignorant about GSTL and as such transactions of GSTL with said concern are fictitious; that the investigation also revealed that GSTL is engaged in availing ineligible ITC on the invoices without receipt of goods or services and has evaded payment of tax. Held: In the present matter, petitioner has filed an affidavit dated 28.04.2021 that he has already paid an amount of Rs. 45,00,000/- and that he would deposit Rs. 5,00,00,000/- under protest towards the alleged amount of tax evasion to demonstrate bona fides and that it would be subject to, adjudication of the amounts alleged and rights and remedies of the petitioner - Another additional affidavit is filed on 06/05/2021 stating that in addition to aforesaid amount aggregating to Rs. 5.45 Crore, further amount of Rs. 55 Lakh will be deposited - Entire aggregate amount of Rs. 6 Crore would be deposited within a period of fortnight which would be under protest and subject to adjudication - Petitioner to be released from jail subject to execution of bond; furnishing of surety and complying with other conditions as mentioned - Division Bench decision in Sunil Kumar Jha Vs Union of India & Ors - 2021-TIOL-628-HC-MUM-GST relied upon: High Court [para 21, 22, 23] - Petition allowed: BOMBAY HIGH COURT

2021-TIOL-1067-HC-MUM-GST

Amit Kumar Shukla Vs UoI

GST - Petitioner, inter alia, seeks bail - It is urged by the Revenue that M/s. Sushimita Mercantile Pvt. Ltd., has fraudulently availed ITC of Rs. 46 Crores and M/s. Vijay Ispat has fraudulently availed ITC of Rs.20 Crores only on the basis of mere documents i.e. Invoices/ E-way Bills, without receipt of any goods in contravention of provisions of Section 16(2) of the CGST Act, 2017 and Petitioner appears to have played a prominent role in the fraudulent availment of and passing of ITC of amount of Rs. 66 Crores without supply of goods, attracting punishment under the provisions of Section 132(1)(c) and 132(1)(b) of the CGST Act, 2017. Held: Having noted the scale of the alleged scam as well as the involvement of Petitioner, Bench is not inclined to interfere with the investigation at this stage, as that may tantamount to foreclosing the out-come to the investigation and would rather hamper the same - Taking into account the principles laid down by the Supreme Court in the case of Arnab M. Goswami v/s. State of Maharashtra (AIR 2021 SC-1) and considering the magnitude and the scale of the alleged fraud involving public money and the critical stage, when investigation to get hold of the mastermind/ kingpin and other key conspirators as well as the modus operandi is underway in which Petitioner, through his sole proprietary concern, as well as through the Pvt. Limited Company, is alleged to be an active participant, at this stage, Bench is not inclined to indulge into the request for grant of bail under Article 226 of the Constitution of India -Petitioner's prayer for bail in this Petition is hereby rejected at this stage - Matter listed on 21st June, 2021: High Court [para 16, 18, 19]

- Petition rejected: BOMBAY HIGH COURT

2021-TIOL-1073-HC-MAD-VAT

SSS Jewel Paradise Pvt Ltd Vs Assistant Commissioner (ST)

Whether assessment order passed without granting personal hearing to the assessee merits being set aside in favor of fresh hearing being granted to the assessee - YES: HC

- Assessee's writ petition allowed : MADRAS HIGH COURT

2021-TIOL-1062-HC-MAD-VAT

Cauvery Timber Company Pvt Ltd Vs Assistant Commissioner (ST)

In writ, the High Court observes that the assessee remitted half of the disputed tax demand & so permits the assessee to furnish a personal bond in respect of the remaining duty & penalty. The Court permits four weeks' time for such exercise. It further directs that subject to furnishing of personal bond, Stay would be granted in respect of the balance tax demand & penalty.

- Assessee's writ petitions partly allowed: MADRAS HIGH COURT

2021-TIOL-184-SC-CUS-LB

Dish TV India Ltd Vs Mckinsey Knowledge Centre India Pvt Ltd

Cus - Petitioner prays for issuing a writ/direction directing the respondent no. 2 to entertain the appeals by dispensing with the petitioner requiring to deposit a further amount of Rs. 3,23,53,823/- being the balance of 7.5% of the assessed duty u/s 129A of Customs Act, 1962 in regard to the appeal against O-I-O No. 2 dated 28.04.2020 and also a direction directing that the amount totalling Rs. 16 crores deposited by the petitioner during the course of investigation be applied as pre-deposit for appeals against O-I-O No. 2, dated 28.04.2020 and O-I-O No. 1 dated 27.04.2020 - Later the High Court held that in view of the statutory provisions contained in section 129E of the Customs Act, it appears that the statute has now effected waiver of pre-deposit to the extent of 90% or 92.5% of the duty amount and has made it mandatory to deposit 7.5% or 10% of the duty amount, as the case may be - It ought to be kept in mind that the relief is granted by the law itself - Courts cannot be more charitable than the law - When the provisions of the law are explicitly clear or where the provisions of law are absolutely unambiguous, such type of pre-deposits cannot be waived by the courts - Statute itself has waived 90% or 92.5% of the duty amount, as the case may be, assessed by the authorities under the Customs Act, 1962 - The petitioner-assessee has to deposit only 7.5% or 10% (as the case may be) of the duty assessed - Thus, there is no question of further waiver of the amount which is required to be deposited under Section 129E of the Customs Act, 1962 - Search engine Google was used from where Bench found out that the annual turnover of the petitioner for the Financial Year 2018-19 was approximately Rs. 6000 Crores and this figure is now confirmed by the counsel for the petitioner - In view of these facts, the amount to be deposited by the petitioner before CESTAT, New Delhi in their statutory appeal under the Customs Act, 1962 comes to Rs. 4.23 Crores for one appeal, which is 0.0705% of the total turnover - Hence, Bench sees no reason to entertain this writ petition looking to the total turnover of the petitioner as well - As the appeals preferred by the petitioner under Section 129A of the Customs Act, 1962 are pending before CESTAT, Bench is not at all inclined to observe anything on the merits of the case - Suffice it to say that the statutory appeals preferred by the petitioner shall be decided on their own merits, in accordance with law, rules, and regulations and on the basis of the evidence on record - The decision shall be taken by CESTAT only after deposit of the pre-deposit as required under Section 129E of the Customs Act, 1962 within the timeframe given by the law - Writ petition was dismissed.

Held - As the counsel for the petitioner seeks to withdraw the present SLP, the same is dismissed as withdrawn: SC LB

- SLP dismissed: SUPREME COURT OF INDIA

2021-TIOL-183-SC-ST

CST Vs Pernod Ricard India Pvt Ltd

ST - The assessee-company is engaged in manufacture, marketing and sale of various brands of Indian Made Foreign Liquor (IMFL)/alcoholic beverages in India - It entered into agreements with various independent bottlers who possesses the necessary licenses for manufacturing of alcoholic liquors - The bottlers retain certain fixed amount as bottling charges on which they are discharging their service tax liability and remaining amount was retained by the assessee - The assessee opined that as it is not providing any taxable service, it need not pay service tax - But, various representation made by the CBEC, seeking clarification with regard to the taxability of such transactions - The assessee obtained service tax registration and discharge service tax liability under the category of BAS under protest - Thereafter, vide Circular dated 27.10.2008 wherein it has been clarified that the taxability in respect of contract bottling arrangements, the bottlers in contract bottling arrangement render service to the brand owners and therefore such CBUs (contract bottling units) are liable to pay service tax on the income under the category of 'Business Auxiliary Service' - Thereafter, the assessee discontinued the payment of service tax - It was issued SCNs by DGCEI after investigation wherein the demand was made under the category of 'BAS on the amount of profits earned under the arrangement of appellant with the CBUs - On adjudication, the demands were sustained - Later the CESTAT held that considering the mandate of CBEC Circular No. 332/17/2009, dated 30.10.2009 it is seen that the assessee being brand owner and earned the profits, the same being in nature of business profit and the same is not chargeable to service tax - The circular has not been withdrawn by the CBEC yet - Moreover, the CBUs are paying service tax under the category of BAS which means the assessee is not a service provider but is a service recipient - Also considering the findings rendered in the assessee's own case for an earlier period, no service tax liability is found to arise.

Held - Notice be issued to the parties concerned, in respect of the appeal as well as the application for condonation of delay - Matter be tagged with Civil Appeal Diary No.12878 of 2020: SC

- Notice issued: SUPREME COURT OF INDIA

2021-TIOL-1071-HC-AHM-CX

Gujarat State Fertilizers And Chemicals Ltd Vs UoI

CX - There are two fold grievance on the part of the petitioners; firstly the officer who had heard the petitioners personally at Anand has not decided the matter and instead it is the Commissioner of Central Excise, Vadodara, who adjudicated the matter and secondly, there was substantial delay in delivering the judgment after having heard the parties - This long delay between the date of hearing and adjudication of the matter, is the second major grievance on the part of the petitioners, the period of 13 months, according to the petitioner, is unsustainable under the law and various judgments of the High Court.

Held: It is not in dispute that the order is appealable under Section 35 B of the Central Excise Act, 1944 which provides for appeal to the Appellate Tribunal within three months from the date on which the order sought to be appeal is communicated - The alternative efficacious remedy is available, therefore, Bench is inclined to relegate the parties to the CESTAT - For getting the relief from the CESTAT, minimum 7.5% of the duty of the demand made, is a must as pre-deposit – Considering the CESTAT order dated 28.02.2020 = 2020-TIOL-788-CESTAT-AHM , on identical issue confirming the demand within limitation on the quantity of sulphur used in manufacture of Hydroxylamine sulphate (HX/HAS) and Phosphoric Acid, the amount of pre-deposit at the rate of 7.5% would come to Rs. 3,63,784/- - Subject to the deposit of this amount within a period of One Week and filing of the Appeal within a period of Four Weeks, before the CESTAT, the petition is not being entertained on merits while relegating the parties to the CESTAT, without entering into the merits of the Order-in-Original and keeping all issues open for the parties to agitate before the Tribunal for it to adjudicate - This order shall not be treated as precedent, as in case of the very petitioner the CESTAT has ordered in favour of the petitioner during the pendency of the petition on the issues raised on facts and law which are not only similar, but are identical – Petition disposed of: High Court [para 8, 12, 13]

- Petition disposed of: GUJARAT HIGH COURT

2021-TIOL-1069-HC-MAD-CX

Mahaveer Foods And Beverages Vs Pr.CGST & CE  

CX - Petitioner states that they procure Tea from registered tea suppliers; Herbs & Spices from dealers in powder form and permitted food colours; that all the said items are mixed together and made as a product, which is called as "Herbal Sherbat Granules"; that it is only a flavoured tea and not a ready to drink or instant tea item; that it contains around 90% of Tea; that in response to the show cause notice dated 05.11.2015 seeking to classify the above product under subheading No. 2101 2090, the petitioner submitted objections and the 1st respondent considered and passed orders in proceedings dated 29.11.2017, which is under challenge in the present writ petition - Petitioner contended that it is a fit case for remanding the matter back to the first respondent for fresh adjudication as the first respondent has not considered the grounds mainly raised by the petitioners; that the Central Food Technological Research Institute, Mysuru, had not at all received the sample products and in the absence of sample products, the results cannot be declared and based on certain presumptions and assumptions, the first respondent proceeded and passed the impugned order and, therefore, the impugned order is liable to be set aside.

Held: Petitioner has to avail the further opportunity of appeal for effective adjudication of the issues with reference to the original documents and evidences, which all are relied on by the parties concerned - Bypassing the Appellate Remedy is not preferable in such circumstances, in view of the fact that in the event of any finding in a writ proceedings, the same may cause prejudice to either of the parties - Thus, the High Court is not empowered to venture into the adjudication of certain intricacies in the facts and circumstances, which is to be done in the case with reference to the nature of products and other technical aspects - Court is of the opinion that exhausting of an appeal remedy is of paramount importance for effective adjudication of the issues with reference to the original documents and evidences produced by the respective parties to the lis - Court has no hesitation in arriving a conclusion that the petitioners are bound to exhaust the Appellate Remedy as contemplated under Section 35-B of the Central Excise Act, 1944 - The petitioners are at liberty to approach the Appellate Authority by filing an appeal in a prescribed form and by complying with the provisions of the Act - The petitioner is also at liberty to file such an appeal before the Appellate Tribunal within a period of 30 days from the date of receipt of a copy of this order and in the event of filing any such appeal, the Appellate Tribunal shall adjudicate the matter - Petition dismissed: High Court [para 11, 12, 14]

- Petition dismissed: MADRAS HIGH COURT

2021-TIOL-270-CESTAT-CHD

Hardcastle Petrofer Pvt Ltd Vs CCE & ST

CX - The appellant is in appeal against impugned order wherein the credit has been denied to them on the premise as per Notification No. 02/14-C.E. (N.T) - Without going into the merit of case, the appellant has contesting only on limitation - There is no provision in law for the appellant to file invoices before department in time - As the appellant was allowed credit by adjudicating authority although the revenue has filed appeal against those orders before Commissioner (Appeals) - When the adjudicating authorities are having a divergent view, the extended period of limitation is not invocable - Admittedly, the SCN has been issued by invoking extended period of limitation - The similar view was taken by Tribunal in Saraswati Agro Chemical (India) Pvt. Ltd. - Further, in the case of Dharampal Satyapal Limited , this Tribunal has taken a view on merit and held that the appellant is entitled to take cenvat credit on inputs - The SCN issued to the appellant is barred by limitation - The impugned order is set aside: CESTAT

- Appeals allowed: CHANDIGARH CESTAT