2021-TIOL-1600-HC-ALL-GST

VS Enterprises Vs State of UP

GST -  Petitioner submits that the respondent no. 2 issued two notices u/s 74 of the UP GST Act, 2017 being notices dated 22.09.2020 and 22.12.2020 for the period September 2017 to December 2017 and July 2017 to March 2018 respectively; that another notice dated 09.04.2021 was issued u/s 74 of the Act by respondent no.3 for the period November 2017 - Petitioner further submits that arising therefrom, three adjudication orders (all dated 09.06.2021), came into existence, that have been challenged in the present petition on account of the fact that for one tax period and for one dispute, there can only be a single adjudication order - That no order could have been passed till the date to furnish reply as extended by the government notification dated 01.05.2021 had lapsed - Petition was entertained on 14.07.2021 and the counsel for respondents prayed for ten days time to seek instructions - Counsel on the next date of hearing submits that on account of bonafide mistake committed, three orders came into existence, however, it is respondent no.2 who had and who continues to have jurisdiction to make proper adjudication. Held:   In view of the fair statement made by counsel for the Revenue, no useful purpose would be served in keeping the present petition pending or calling for counter affidavit - Undisputedly, three periods for which the orders had been passed are overlapping - Notice dated 22.12.2020 was issued by respondent no.2 for the period July 2017 to March 2018 - It covers the entire period and dispute being sought to be adjudicated in the other two notices as well - I t has been brought to the notice of the Bench that realising the difficulties from the spread of pandemic COVID-19, the Government had itself issued an order dated 01.05.2021 extending the period to submit reply and responses, up to 30.05.2021 - Subsequently, it was extended up to 30.06.2021 - In light of that fact, the order dated 09.06.2021 is clearly an ex-parte order, which has been passed without allowing due opportunity of hearing to the petitioner - Petition is, therefore, disposed of by quashing the orders dated 09.06.2021 which cover the overlapping period September 2017 to December 2017 and for the period November 2017 - insofar as the order concerning period July 2017 to March 2018 is concerned, the same is also set aside and the matter is remitted to the respondent no. 2 to pass a fresh adjudication order after affording reasonable opportunity of being heard and allowing petitioner to file reply within one month: High Court 

- Petition disposed of: ALLAHABAD HIGH COURT

2021-TIOL-1599-HC-MAD-CUS

RKKR Steels Ltd Vs Central Board of Excise and Customs

Cus - Petitioners have raised the preliminary ground of jurisdiction by stating that the show cause notices were not issued by the jurisdictional officer and, therefore, the show cause notices are without jurisdiction; that the proper officer, in the present case, is the Commissioner of Customs, Chennai; that the impugned show cause notices are issued by the Deputy Director, Directorate of Revenue Intelligence, Regional Unit, Goa, who has no jurisdiction to issue such show cause notices, as far as the petitioner-company is concerned - Petitioners rely on the Supreme Court decision in Canon India Pvt. Ltd. - 2021-TIOL-123-SC-CUS-LB to support their stand. Held:  In the present case, by invoking the powers under Section 4(1) of the Act, the Board conferred powers to the Commissioner of Central Excise, Goa and authorises him to exercise the powers and discharge the duties conferred or imposed on the Commissioner of Customs, Port Imports, Chennai for the purposes of adjudicating the matters relating to show cause notice - Therefore, it is unambiguous that the Board appointed the Commissioner of Central Excise, Goa as a proper officer under Section 4(1) and the said Commissioner of Central Excise, Goa is empowered to exercise powers of the officers of Customs under Section 5 and with reference to the definition of proper officer under Section 2(34) of the Act, therefore, there is no ambiguity in respect of the powers exercised in the present case - The judgments cited by the learned counsel for the petitioner were not related to the conferment of powers by the Board under Section 4(1) and 5 of the Act - Supreme Court (in Canon India case) interpreted the word 'proper officer' and as per the definition under Section 2(34) of the Act, 'proper officer' means the officer having jurisdiction over the concerned person - However, in the event of exercising the powers under Section 4(1), if the Board appoints any other officer as an officer of customs, then such an officer becomes the proper officer within the definition under Section 2(34) of the Act, who in turn is empowered to exercise the powers of officers of Customs under Section 5 of the Act - Judgments cited by the petitioner were not related to the conferment of powers by the Board under Section 4(1) and 5 of the Act, therefore, the interpretation offered by the petitioners stands rejected -  As far as the show cause notices are concerned, the merits are to be adjudicated by the competent authority/the respondent - High Court cannot adjudicate the disputed facts with reference to the documents and evidences to be produced by the respective parties - Thus, the petitioner has to submit their explanations/objections, if any, along with the documents and evidences to the respondents enabling them to consider the same and pass orders by following the procedures as contemplated and by affording opportunity to the writ petitioners - Such an exercise is to be done as expeditiously as possible - In view of the fact that the jurisdiction point raised by the petitioner fails, as the facts and  circumstances of the case decided by the Supreme Court are not connected with the grounds raised in the present writ petition by the respondents, this Court has no hesitation in forming an opinion that the petitioners have not established the ground of jurisdiction and thus, the petitioners are bound to respond to the show cause notices and on receipt of any such objections/explanations, the respondents are bound to continue the proceedings and conclude the same as expeditiously as possible - Petitions dismissed: High Court [para 15, 16, 17, 18] Cus - Entertainability -  A writ against a show cause notice may be entertained, only if the show cause notice is issued by an incompetent authority having no jurisdiction or allegations of malafides are raised - If allegations of malafides are raised, then the authority against whom such an allegation is raised is to be impleaded as a party respondent in the writ proceedings in his personal capacity - Thus a writ petition, against a show cause notice, is not entertainable in a routine manner - Only in the event of raising the ground of jurisdiction, which is to be substantiated with reference to the statutes or rules in force, then alone such writ is entertainable - Petitions dismissed: High Court  [para 3]

- Petitions dismissed: MADRAS HIGH COURT

2021-TIOL-441-CESTAT-MUM

Everest Flavours Ltd Vs CCE

CX - The appellant is disputing the denial of CENVAT credit with consequent order of recovery of those amounts under Section 11A along with applicable interest under Section 11AB of Central Excise Act, 1944 and imposition of penalty of like amounts under section 11AC - It is common ground that the first appellant had furnished documents issued by transporters as evidence of receipt of inputs at their facility - However, the veracity, or lack thereof, of these had not been a determining factor in proceedings before the adjudicating authority - There is, no doubt, that claims of transfer should have been subjected to scrutiny through the appropriate authorities even in circumstances of an adjudication order determining that suppliers could not have provided the first appellant with the required inputs - More so, as it was not considered necessary that these proceedings be a part and parcel of that initiated against the suppliers - The want of such separate ascertainment strains the credibility of determination in impugned order - The several independent arguments for setting aside the demand of duties and the imposition of detriments was disregarded by adjudicating authority on the assurance of finding of lateral jurisdiction on goods not having been supplied - It would therefore, appear that the adjudicating authority was influenced entirely by finding of non-manufacture on the part of supplying units by the coordinate statutory functionary which ceases, owing to nullification by coordinate bench of Tribunal, to sustain the impugned order in the absence of any other limb - The impugned order does not commend itself as redolent of essential qualifications of being legal and proper - At the same time, nature of controversy does not lend itself to disposal of the allegations as being legally untenable - Adjudicating authority is directed to determine the issues afresh in accordance with statute as enacted and precedent as judicially established: CESTAT

- Matter remanded: MUMBAI CESTAT

2021-TIOL-440-CESTAT-MAD

Indian Overseas Bank Vs CGST & CE

ST - The appellant, a Nationalized Bank is engaged in providing 'Banking and Other Financial Services' - The demand relates to interest earned from lending of gold and safe-vault services alleged to have been provided to the foreign sellers - The appellant accepts deposits from customers in the form of gold bar and lends the gold to jewellers in form of gold only, along with a charge of interest on such lent gold - As regards to the dispute relating to services alleged to have been rendered to foreign sellers, the appellant as one of the nominated banks authorized by Reserve Bank of India to import and trade in gold has been authorized to grant Gold (Metal) Loans to jewellery manufacturers as per Circulars dated 05.09.2005 and 03.04.2007 - The appellant imports gold bars/coins from UBS AG and MKS Finance SA Switzerland respectively (foreign sellers) on consignments basis under a "Precious Metal Consignment Agreement" (PMCA) upon payment of applicable Customs duty - The transaction is such that the Precious Metal is procured from foreign suppliers in bar/coin form under an agreement to sell at a future date - The appellant acquires only possessory rights but not rights of ownership over the Precious Metal - As and when a customer approaches the appellant for purchasing gold, a back-to-back transaction of purchase (from the foreign supplier) and sale (to the customer) is executed by appellant - In the intervening period between receipt of imported Precious Metal and sale to consumers, appellant facilitates the safekeeping of imported Precious Metal in its own vaults - The appellant sells Precious Metal to its customer with a profit margin upon payment of applicable Sale tax - The demands have been considered by Division Bench of Tribunal in M/s. Indian Overseas Bank 2021-TIOL-57-CESTAT-MAD and the appeal has been decided in favour of appellant - In view of the said decision, the order impugned is set aside: CESTAT

- Appeal allowed: CHENNAI CESTAT

2021-TIOL-439-CESTAT-MAD

Neyveli Lignite Corporation Ltd Vs CC, CE & ST

ST - The period involved in appeal is after 01.07.2012 and the case set out by Department is that the appellant had agreed to tolerate breach of timelines stipulated in contract; the amount imposed as liquidated damages are consideration for the act of tolerating contractual default; and that the appellant had rendered declared service of 'agreeing to the obligation to refrain from an act, or to tolerate an act or a situation or to do an act' contemplated under section 66E(e) of Finance Act, 1994 - There is substance in the submission advanced by appellant that no service tax is payable on the amount collected towards liquidated damages as this issue has been decided by Tribunal in favour of appellants in case of South Eastern Coalfields 2020-TIOL-1711-CESTAT-DEL wherein the Tribunal rejected the contentions advanced on behalf of Department that penalty amount, forfeiture of earnest money deposit and liquidated damages had been received by said appellants towards "consideration" for "tolerating an act" leviable to service tax under section 66E(e) of the Finance Act - This decision of Tribunal in South Eastern Coalfields was followed by Tribunal in M.P. Poorva Kshetra Vidyut Vitran 2021-TIOL-105-CESTAT-DEL - In view of the said decisions of Tribunal, it is not possible to sustain the view taken by Commissioner that since the task was not completed within the time schedule, the appellants agreed to tolerate the same for a consideration in the form of liquidated damages, which would be subjected to service tax under section 66E(e) of the Finance Act - As service tax could not be levied, imposition of interest and penalty also cannot be sustained: CESTAT

- Appeals allowed: CHENNAI CESTAT