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I-T - Penalty u/s 271AAA can be imposed where assessee has declared source of undisclosed income: ITAT

I-T- Addition made in respect of over invoicing on entire purchases if based on presumption and surmises can't sustain : ITAT

I-T - Since AO has worked out disallowance more than exempt income, such extra disallowance can not sustain: ITAT

I-T- When assessment is sought to be reopened on the ground that income has escaped assessment on a certain issue, AO can't make reassessment on another issue :ITAT

I-T - When sales have not been doubted and assessee has produced books of account including details of purchases, therefore, adoption of net profit @ 0.075% appears to be proper : ITAT

I-T - Undisclosed raw jute stocks being already included in closing stock as credited by assessee in profit and loss account, addition made by AO in respect of such undisclosed closing stock is not proper : ITAT

I-T- Addition of interest being 50% of total interest earned on foreign bank account cannot be sustained as deposits lying in foreign bank account belongs to assessee's mother and should be brought to tax in her hands only : ITAT

I-T - PCIT action of setting aside assessment order in exercise of power u/s 263 is without jurisdiction as AO's action of accepting loss on three scrips cannot be termed as a case of no-enquiry on part of AO and is in line with CBDT Circular No. 6/2016: ITAT

I-T- Is sue of disallowance u/s 14A needs reconsideration as there is no bifurcation of income earned as tax free income and taxable income and CIT(A) has accepted contention of assessee without giving a proper and thoughtful consideration to issue - ITAT

GST - Services supplied by sub-sub-contractor to sub-contractor & not to main contractor - Conditions of Entry 3(iii)/3(ix) to 11/2017-CTR not satisfied - GST chargeable @18%: AAR

GST - AAR cannot be used as a mechanism to nullify and frustrate the inquiry proceedings already initiated by DGGI: AAR

GST - 'Any proceeding' in S.98(2) will encompass within its fold the investigation proceedings launched by the DGGI u/s70 of the CGST Act: AAR

GST - 'Ammonium Sulphate' is classifiable under HSN 3102 21 and attracts GST @5% when supplied for direct use as fertilizers: AAR

CX - Testing by discerning smokers - Bought out competitors cigarettes removed from factory a fter carrying out masking and putting code number on new packet - no duty payable: CESTAT

CX - The adjustment of some amount from the sanctioned amount of rebate claim has been made bona fide as permissible under the provisions of Section 11 of CEA, 1944: CESTAT

2021-TIOL-243-AAR-GST

Kababhai Popatbhai Savalia

GST - Applicant is engaged in providing works contract service directly to sub-contractors who execute the contract with the main contractor for original contract work with the irrigation department (State of Gujarat) - Applicant has sought a clarification as regards the rate of tax to be levied from the sub-contractor for original contract work pertaining to irrigation and construction work (works contract) - Inasmuch as it is the contention of the applicant that they should be charged @12% only and not @18%.

Held: Authority observes that the Government Irrigation Division awarded work contract to Main Contractor M/s JSIW for EPC of a pumping station - Subsequently, the Main contractor awarded the said work to sub-contractor M/s Radhe Construction who, in turn, awarded the said work to the applicant, who is now a sub-sub-contractor - Authority notes that to be eligible for being covered at Sr no 3 (iii) of said NT 11/2017-CT(R), the following two conditions shall be satisfied viz. (i) Composite Supply of Works Contract to be supplied by Main Contractor to Government and ( ii) Supply by way of construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation, or alteration of canal, dam or other irrigation works - Authority observes that the applicant does not satisfy condition 1, but satisfies only condition no. 2 - Further, to be eligible for being covered at Sr no 3 (ix) of said NT 11/2017-CT(R), the following two conditions shall be satisfied: (i) Composite supply of works contract provided by a sub-contractor to the main contractor and (ii) That main contractor shall provide services specified in item (iii) to Government - It is observed that the applicant is not a sub-contractor but a sub-sub-contractor, therefore, the applicant does not satisfy both the conditions - Wording in the said Notification, when clear, plain and unambiguous and only one meaning can be inferred, Authority is bound to give effect to the said meaning and cannot allow any scope for intendment - Held that the applicant is sub-sub-contractor and supplies service to M/s Radhe [sub-contractor] and not to M/s JSIW [main contractor], and the conditions of said entry 3(iii)/3(ix) to said Notification is not satisfied - Concluded that GST rate on subject supply is @18% for services supplied by the sub-sub-contractor to sub-contractor M/s Radhe and supply merits entry at Heading 9954, Entry No 3(ii) of Notification No.11/2017-CT(R): AAR

- Application disposed of: AAR

2021-TIOL-242-AAR-GST

VL Traders

GST - Advance Ruling cannot be used as a mechanism to nullify and frustrate the inquiry proceedings already initiated vide section 70(1) of CGST Act: AAR

GST - An Admission order no GUJ/GAAR/ADM/2020/112 dated 30-12-2020 was issued earlier, admitting the subject application and it was stated in the Admission order itself that as the applicant has made a declaration that the question raised in the application is not already pending or decided in any proceedings in their case under any of the provisions of the Act and that nothing contrary to this declaration was found by the Authority, the application was, earlier, held as maintainable - However, the applicant has suppressed the material facts that DGGI had initiated inquiry with respect to the same Questions raised in the subject Application and that the proceedings initiated by DGGI vide relevant sections of CGST Act was initiated prior to filing of subject Advance Ruling application - Inasmuch as the applicant had been issued Summons vide Section 70 CGST Act, prior to the filing of subject Application - Authority is of the view that the usage of the words "any proceeding" in the proviso to Section 98(2) of the CGST Act will encompass within its fold the investigation proceedings launched by the DGGI under Section 70 of CGST Act - The applicant has contravened the provision of Section 98(2), CGST Act, in so much that it mis-declared that it had no proceedings pending under any provisions of the Act, with an intention to fraudulently obtain Ruling and frustrate the proceedings initiated by DGGI, for the Question raised in the subject Application dated 5-3-20 and issue for which Investigation was initiated vide Section 70(1) of CGST Act, 2017 by DGGI are the same - Held that investigation initiated against the applicant is a proceeding within the ambit of Section 98 (2) of CGST Act - Application is rejected as non-maintainable and inadmissible: AAR

- Application dismissed: AAR

2021-TIOL-241-AAR-GST

Willmart Enterprise

GST - 'Ammonium Sulphate' is classifiable under HSN 3102 21 and attracts GST @5% when supplied for direct use as fertilizers or used in the manufacturing of complex fertilizers for agricultural use (soil or crop fertilizers) – When supplied for other than fertilizer use, Ammonium Sulphate is chargeable to GST @18%: AAR

- Application disposed of: AAR

2021-TIOL-677-CESTAT-MUM

Godfrey Phillips India Ltd Vs CCE

CX -   As a part of its endeavour to improve and test the quality of cigarettes, the appellant purchases duty paid cigarettes manufactured by its competitors from open market for testing purposes - The competitor's cigarettes so procured are masked covering the competitors brand name, repacked in new pack carrying only a code number and thereafter removed for testing purpose to select panel of discerning smokers without payment of duty - Non-payment of duty on removal of competitor's cigarettes was objected to by the department on the ground that the activity undertaken by the appellant on such cigarettes amounts to manufacture in terms of Section 2(f) of the CEA, 1944 read with Note 3 to Chapter 24 of the CETA, 1985 - SCN was issued proposing to demand Central Excise duty of Rs.6,56,227/- on the competitor's cigarettes cleared for testing purpose during the period from 2004-05 to 2008-09 - Demand was confirmed along with imposition of penalty - Appeal filed before CESTAT.

Held: The  product that emerged after carrying out the activity of masking, putting code number etc. for identification, remained cigarettes only, which were procured by the appellant on payment of appropriate Central Excise duty - Since, there was no change in the name, character and use of the originally bought-out cigarettes, the process undertaken by the appellant in its factory will not be considered as a manufacturing activity, in order to fall under the scope and ambit of the definition of "manufacture", defined under Section 2(f) ibid - In the case in hand, it is an admitted fact on record that excepting the process of masking and putting code number, the appellant had not undertaken any other activity to render the resultant product marketable - There was no involvement of labeling or relabeling of containers inasmuch as they had repacked the bought-out cigarettes from one retail pack to another retail pack before it was coded - Such activity also will not be covered under the purview of Chapter Note 3  inasmuch as there was no repacking from bulk pack to retail pack - The main objective of carrying out the process of masking etc., by the appellant was for the purpose of testing and not for marketing of altogether new cigarettes, hence, the basic test of marketability envisaged in Note 3 to chapter 24 has not been satisfied - Held that the requirement of deemed manufacture as per note 3 to chapter 24 is not satisfied for levy of central excise duty on disputed goods - no merits in the impugned order, hence same is set aside and appeal is allowed in favour of assessee: CESTAT [para 6 to 8]

- Appeal allowed: MUMBAI CESTAT

2021-TIOL-676-CESTAT-DEL

Mangalam Cement Ltd Vs CCGST

CX - The appellant had filed a rebate claim under Rule 18 of CER, 2002 for an amount of Rs. 23,59,941/- in respect of duty paid on goods, which were exported by appellant - The Assistant Commissioner vide his O-I-O sanctioned the rebate claim for an amount of Rs. 23,59,941/-, but an amount of Rs. 13,19,323/- was adjusted against the amount of Rs. 23,59,941/-, which is allegedly due from the appellants - The appellant urged that the adjustment made of the amount of Rs. 13,19,323/- from the sanctioned amount of rebate claim is illegal and untenable - From the provisions of Section 11 of CEA, 1944, it is evident that the adjustment has been made bona fide as permissible under the provisions of the Act: CESTAT

- Appeal dismissed: DELHI CESTAT

2021-TIOL-675-CESTAT-AHM

Stratese Consultancy LLP Vs CCE & ST

ST - The issue involved is, whether the assessee's refund claim filed under Rule 5 of Cenvat Credit Rules, 2004 is hit by limitation of one year as provided under Section 11B of Central Excise Act, 1944 - The assessee in respect of refund claim for the quarter October-December-2016 has filed on 05.01.2018 even though it was sent by post on 02.01.2018 - In respect of refund claim for the quarter January-March-2017, it was filed on 27.03.2018 - Since the condition in Notification No. 14/2016-CE (N.T.) is that the assessee is required to file refund claim under Rule 5 not more than one in a particular quarter, therefore, the period of one year should be reckoned from the end of the quarter for which the refund is sought for - In the present case for the quarter October-December- 2016 the one year period expired on 31st December, 2017 - However, the refund was filed on 05.01.2018, therefore, it is clearly beyond one year hence this refund is clearly time barred, hence, the rejection of the same is maintained - As regard the refund claim pertaining to quarter January-March-2017, it was filed within one year from end of the quarter i.e. 27.03.2018 is held within time - Accordingly, the refund of Rs. 1,45,736/- is not time-barred - The appellant is entitled for this refund: CESTAT

- Appeal partly allowed: AHMEDABAD CESTAT