2021-TIOL-154-AAR-GST

Teretex Trading Pvt Ltd

GST - Applicant procures purchase order for supply of goods from the buyers located in India - He then connects such prospective buyers with the supplier of goods who are located outside the country - The supplier of goods thereafter despatches the goods directly to the buyers - Applicant is of the opinion that the services going to be undertaken by him shall be termed as 'export of services' as per clause (6) of section 2 of the Integrated Goods and Services Tax Act, 2017 and therefore, he has no liability to pay tax on such supply of services - Ruling sought on the said proposition.

Held: Aforesaid question on which the advance ruling is sought for is found to be covered under clause (e) of sub-section (2) of section 97 of the GST Act - It appears that the applicant being supplier of services by way of arranging or facilitating sales of goods for various overseas suppliers and admittedly the same is not being done on his own account, satisfies all the conditions to be an intermediary as defined in clause (13) of section 2 of the IGST Act, 2017 - In the present case, the applicant being the supplier of services is located in India and the recipient of services being located outside the country attracts the provisions of the aforesaid section of the Act ibid - applicant is found to be an 'intermediary', so the place of supply shall be determined under sub-section (8) of section 13 of IGST Act, 2017 which shall be the location of the supplier of services i.e., in West Bengal for the present case - As a result, the supply shall be treated as an intra-State supply in terms of sub-section (2) of section 8 of the IGST Act, 2017 and tax will be levied accordingly - This transaction will, therefore, not be covered within the definition of export of services as provided in Section 2(6) of IGST Act, 2017 as it is not satisfying one of the conditions of place of supply being outside India, as enumerated in Section 2(6)(iii) of the IGST Act, 2017 and consequently shall not be treated as zero-rated supply as provided in section 16 of the IGST Act, 2017 - Held, therefore, that services of the applicant by way of arranging sales of goods shall not be considered as 'export of service' as defined under clause (6) of section 2 of the IGST Act, 2017: AAR [para 4.7, 4.8]

- Application disposed of: AAR

2021-TIOL-1442-HC-MUM-ST'

M Ramzan And Company Vs UoI

ST -  A show cause notice dated 20.04.2012 had been issued to Petitioner proposing recovery of service tax to the tune of Rs. 3,78,88,322/- along with interest and to impose penalties - I n the ensuing proceedings before adjudicating authority, certain amounts were deposited on various dates aggregating to Rs. 32,12,000/-  -  In Petitioner's case, Order-in-Original had been passed on 09.07.2019 by the Commissioner without deduction of the amount of Rs. 32,12,000/- confirming the demanded amount along with interest and penalties -  Since final hearing in Petitioner's case before the Commissioner had taken place on 14.05.2019 and order had been awaited, as such, there was a restraint on the Petitioner from opting for the benefit of the SVLDRS, 2019 scheme - CBIC had vide  circular No. 1074/07/2019-CX dated 12.12.2019 clarified, inter alia, that in the cases which were heard on or before 30.06.2019 and order has been passed after 30.06.2019, such assessees would also be able to opt for the benefit of the scheme subject to condition that they would apply under the category “arrears” and pay 60% of the disputed tax dues with an undertaking that the order would not be challenged further -  Petitioner had accordingly opted for the scheme and had filed necessary declaration in Form SVLDRS-1 showing tax arrears of Rs. 3,78,88,322/- and pre-deposit of duty as Rs. 2,73,00,045/- and tax dues (after tax relief) were shown as Rs. 63,52,966.20/-, with the pre-deposit comprising the amount of Rs. 32,12,000/- paid by the Petitioner from time to time in the proceedings after show cause notice -  Designated Committee, however, issued Form SVLDRS-2 on 22.02.2020 showing estimated amount payable at Rs. 82,80,167/- instead of Rs. 63,52,966.20/- -  During the personal hearing on 24.02.2020 before the Designated Committee, the Petitioner, amongst others, had also informed that an amount of Rs. 32,12,000/- had been deposited by them towards service tax demand after receipt of show cause notice and the same had not been considered by the Commissioner while passing the order despite reference to the same in the order and copies of challans and as such, had requested to consider said deposit of Rs. 32,12,000/- while arriving at the estimated tax payable under the SVLDRS scheme - Yet, the Designated Committee again issued statement under Section 127 of the Finance (No.2) Act, 2019 in Form SVLDRS-3 showing the estimated amount of Rs. 82,80,167/- without taking into account and giving effect to the deposit of Rs. 32,12,000/- paid after receipt of show cause notice - Hence the Writ petition.

Held: On the whole, the approach of the authorities appears to be rather hyper-technical, as electronic data base does not disclose the payment despite challans being produced by the petitioner and further that the communication by the petitioner is to some other jurisdictional superintendent's office and not to the concerned one shows an apathetic approach and in the process, SVLDRS-3 ostensibly appears to tend to recover Rs.32,12,000/again, a matter which would require verification - It is not a case at all that the payment is denied or the challans of payment are not available - There is no explanation with regard to the appropriation or receipt of amounts under challans - In such a case, while there is a report on record stating that going by the challans, the total amount paid by the petitioner towards service tax was Rs.2,73,00,045/- comprising the amount of Rs.32,12,000/-, the matter will have to be properly verified at the end of the respondents which would be necessary and pertinent - The authorities are not expected to go-about hyper-technically and/or unmindful of claims of assessees based on material while determining the estimated amount of payment in the matter - The whole process under the scheme is with a view to augment expeditious disposal of the case and is not for the purpose of declining and denying legitimate claims - Bench is not impressed by listless approach on behalf of the respondents - The department should verify factual position and pass appropriate orders -  Impugned order is set aside and Respondent No. 2 is directed to re-consider the petitioner's SVLDRS-1 and after verifying the claim of Rs.32,12,000/- having been paid towards the service tax referred to in the show cause notice, issue revised SVLDRS-3 - Petition is allowed in the above terms: High Court [para 20 to 22]

- Petition allowed :  BOMBAY HIGH COURT

2021-TIOL-367-CESTAT-AHM

CST Vs Intas Pharmaceuticals

ST - Service Tax has been demanded on the amount received by employer from its employees - The amount is recovered in lieu of mandatory notice period prescribed in employment contract from employees quitting the job - When the employee intends to resign, the employment contract requires him to give a notice of 2-3 months - However, if the employee wishes to quit without giving due notice to the employer, then as per the agreement, the employer is entitled to recover a certain amount from the employee - The issue has been settled by High Court of Madras in the case of GE T & D India Pvt. Ltd. - In view of the fact that the issue has been settled by High Court, the appeal is dismissed: CESTAT

- Appeal dismissed: AHMEDABAD CESTAT

2021-TIOL-366-CESTAT-MAD

Carborandum Universal Ltd Vs CGST & CE

CX - The appeal is filed against penalty imposed upon the appellant under section 11AC of Central Excise Act, 1944 r/w Rule 15 of Cenvat Credit Rules, 2004 - The appellant has reversed credit availed on Works Contract Service and Manpower Supply Service immediately on being pointed out by department in 2014 along with applicable interest - No positive evidence is brought to light that the appellant had any fraudulent intention to avail such credit - Though the department alleges suppression of facts, it has to be stated that the said availment of credit came to light from the accounts maintained by appellant - The strong inference would be that the appellant reflected the availment of credit in their accounts and the allegation of suppression fails - The penalty under section 11AC ibid cannot sustain: CESTAT

- Appeal allowed: CHENNAI CESTAT

2021-TIOL-365-CESTAT-MAD

Green Port Shipping Agencies Vs CC

Cus - The appellant is seeking the deletion of penalty under Section 112(b) of Customs Act, 1962 levied on it - Admittedly, the appellant is only a shipping liner who not only did not file the IGMs in question, but also did not file even the Bill-of-Lading - Facts on record reveals that the appellant has maintained all along that it never had the possession of impugned goods nor was in any way concerned with carrying and removing of consignments in question and hence, it was beyond their comprehension that the goods in question were per se liable for confiscation under Section 111(d) ibid - The appellant is neither the importer nor the owner who had acquired possession nor in any way concerned with carrying or removing of goods and Revenue has nowhere ascribed knowledge of appellant as to the confiscation - Further, Revenue has also nowhere offered redemption in lieu of confiscation in so far as the appellant is concerned, which establishes that the appellant is in no way concerned nor was it responsible in any way for carrying, removing of the goods in question - The penalties, as levied under Section 112(b) of the Customs Act, 1962, are not justified and accordingly, the impugned orders are set aside: CESTAT

- Appeals allowed: CHENNAI CESTAT