I-T - Consideration paid by amalgamated company over and above net assets of amalgamating company should be considered as goodwill warranting depreciation u/s 32(1) : ITAT

I-T- Since there is need to have clarity on true facts about transaction, issue of addition of unsecured loan can be remanded back for reconsideration : ITAT

I-T - AO can disregard valuation method adopted by assessee only when it is not as per Rules contained in Explanation (a)(i) to sec. 56(2)(vii)(b) : ITAT

I-T - Since assessee has discharged its primary burden by furnishing source of investment no addition u/s 69 can be made without evidences : ITAT

I-T - Deduction u/s 54F is allowable to extent of amount of capital gain invested/utilized till filing of return by Assessee u/s 139(4) : ITAT

I-T - Assessment can be reopened if disclosure made by assessee is full but not true : ITAT

I-T - AO cannot make addition u/s 69 if there are sufficient sources of cash deposits received by assessee : ITAT

2022-TIOL-477-ITAT-DEL

HBA Studio Pvt Ltd Vs DCIT

Whether when advance is paid to prospective vendors & is forfeited due to discharge of contract on account of assessee's failure to honour the contract, then assessee cannot be expected to pursue any remedy or recourse to either get the article delivered or the amounts refunded - YES: ITAT

- Revenue's appeal allowed: DELHI ITAT

2022-TIOL-476-ITAT-DEL

Chander Kanta Maheshwari Vs ITO

Whether deduction u/s 54F is allowable to extent of amount of capital gain invested/utilized till filing of return by Assessee u/s 139(4) - YES: ITAT

- Assessee's appeal allowed: DELHI ITAT

2022-TIOL-475-ITAT-DEL

Bhasin Infotech And Infrastructure Pvt Ltd Vs ACIT

Whether since there is need to have clarity on true facts about transaction, issue of addition of unsecured loan can be remanded back for reconsideration - YES : ITAT

- Matter remanded: DELHI ITAT

2022-TIOL-474-ITAT-DEL

Astral Properties And Constructions Pvt Ltd Vs ITO

Whether since assessee has discharged its primary burden by furnishing source of investment being one of its Director, who herself is income-tax assessee, no addition u/s 69 can be made without evidences - YES : ITAT

- Assessee's appeal partly allowed: DELHI ITAT

2022-TIOL-473-ITAT-MUM

DCIT Vs Kilitch Healthcare India Ltd

Whether AO can disregard valuation method adopted by assessee only when it is not as per Rules contained in Explanation (a)(i) to sec. 56(2)(vii)(b) – YES: ITAT

- Revenue's appeal dismissed: MUMBAI ITAT

GST - Concessional tax rate of 0.75% is applicable only to a promoter in respect of construction of affordable residential apartments in a RREP - Applicant being a sub-contractor, benefit of said entry is not admissible: AAR

GST - There is no supply of coal purely because the applicant neither has any ownership rights nor has any rights to sell the coal that has been excavated by it - Taxable as supply of support service @18%: AAR

GST - Benefit under any conditional notification cannot be extended in case of non-fulfillment of conditions or non-compliance of procedure prescribed therein: AAAR

ST - The electricity charges reimbursed to service provider by service recipient is not includible in gross value of service , demand of service tax is not sustainable: CESTAT

CX - To put an end to a 29 year old litigation, rule 41 of the Procedure Rules, 1982 invoked - No need to remand matter for computing demand for normal period - What is already paid is more than enough: CESTAT

ST - The ervices relating to winning of minerals rendered by appellant are classifiable under category of 'Mining Services' and therefore they would not be liable to service tax prior to 1-6-2007: CESTAT

Cus - Since the SCN itself was issued without authority of law, entire proceedings get vitiated: CESTAT

CX - Notification No. 17/2007 does not require permanent ceasing of work in order to avail benefit of Clause 8 of Notification No. 17/2007, even temporary ceasing of work after following due procedure can entitle the manufacturer to avail exemption: CESTAT

2022-TIOL-58-AAR-GST

Om Construction Company

GST - Applicant is engaged in the business of civil construction of residential premises and supplying Works Contract' service as a sub-contractor to the main contractor (builder), who provides works contract service to construct affordable housing under PMAY scheme for the Economically Weaker Sections - Applicant seeks a ruling in respect of the  applicability of Serial No. 3(i) of Notification No. 11/2017-Central Tax (Rate)(as amended) to the applicant who is one of the sub-contractors to the builder/Developer/Contractor of Affordable housing under PMAY Scheme; e ligibility of concessional rate of CGST at 0.75% as per the amending Notification No. 3/2019-Central Tax (Rate). Held: It is   seen from the column 3 (description of the service) of entry number 3(i) of the principal notification No. 11/2017-Central Tax (Rate) as amended by the Notification No. 3/2019-Central Tax (Rate),  effective from 01.04.2019 that, the concessional rate of 0.75% CGST is applicable only to the promoter in respect of the Construction of affordable residential apartments in a Residential Real Estate Project (RREP) which commences on or after 1st April, 2019 - Admittedly, the applicant is not a promoter but a sub-contractor and hence the benefit of the said entry i.e. concessional rate of GST of 0.75%, for the proposed construction, is not applicable to the applicant: AAR

- Application disposed of: AAR

2022-TIOL-57-AAR-GST

Baranj Coal Mines Pvt Ltd

GST - Applicant has been tasked by Karnataka Power Corporation Limited (KPCL) with developing and operating the Mine & excavating coal & delivering it to KPCL for generation of power - Applicant conveyed to KPCL that, the instant delivery of mined coal to KPCL is not supply-sale of coal but is provision of mining support services, however, KPCL has stated that the impugned supply by the Applicant to KPCL is sale of coal and should be subject to GST @ 5% under HSN 2701 - Applicant seeks a ruling on the following question viz. whether the supply should be subject to GST under HSN 2701, taxable @ 5% or under HSN 9986, taxable @ 18% as Support services to mining. Held: There is no supply of coal by the applicant purely because the applicant neither has any ownership rights on the coal nor has any rights to sell the coal that has been excavated by it - Hence, the applicant is involved in supply of services in the instant case (as seen from the 'Scope of Supply" in the Agreement) and there is no supply of coal by the applicant - Impugned services related to mining of coal, is covered under Sr. No. 24 (iii) with effect from the date of the amendment i.e. 25.01.2018, attracting 18% GST - Amounts towards Royalty, MMDR, DMF Fund and Reserve Price, payable and paid by KPCL directly to the concerned Governmental Authority of Maharashtra are not includible in the Value of Supply for the purpose of levy of GST - However, in future if it is agreed between the applicant and KPCL to make payable and pay, the amounts towards Royalty, MMDR, DMF Fund and Reserve Price by KPCL to the applicant, in such a case, the amounts will be included in the Value of Supply of the impugned services and will be taxed at 18% GST: AAR

- Application disposed of: AAR

2022-TIOL-18-AAAR-GST

Time Technoplast Ltd

GST - The Appellant-company is engaged in manufacturing packaging material including HDPE Drums, Jerrycans and Intermediate Bulk Containers falling under HSN 3923. The goods are supplied to customers who are exporters holding IEC number and registered with the Export Promotion Council - These types of packaging material are billed to the merchant exporter (who is their customer) but shipped, on the instructions of their customer, to the premises of the chemical manufacturer, who manufacturers ethyl alcohol and packs the same in the said HDPE drums - The merchant exporter then exports the ethyl alcohol packed in the HDPE drums within the stipulated time - The Appellant approached the AAR seeking to know whether the Appellant is liable for 0.1% concessional rate of tax under Notfn No 41/2017-IT(R) on the supply of HDPE drums for use by the manufacturer of Ethyl Alcohol in the Appellant's factory for packing manufactured goods and supply to merchant exporter - Hence the present appeal was filed to contest these findings. Held - As per settled law, benefit under a conditional notification cannot be extended in case of non-fulfillment of conditions and/or non-compliance of procedure prescribed therein - The basic rule in interpretation of any statutory provision is that the plain words of the statute must be given effect to - It is only in the case of ambiguity that the principle of strict/liberal interpretation would arise. In this case , there is no ambiguity in the wordings of the impugned Notification - Findings of AAR upheld: AAAR + The Appellant has also made a plea that since the substantial conditions of the impugned Notification have been satisfied, they should be allowed the benefit by adopting a liberal interpretation. They have also relied on several Supreme Court decisions in this regard. The case of Govt of Kerala vs Mother Superior Adoration Convent relied upon by them, pertains to an exemption provision contained in the Kerala Building Tax Act, 1975 whereby, under Section 3(1)(b) of the said Act, buildings that are used principally for religious, charitable or educational purposes or as factories or workshops are exempted from building tax. The State claimed that no exemption should be granted as residential accommodation for nuns and hostels for students would be for residential as apart from religious or educational purposes and would not therefore be covered by the exemption contained in Section 3(1)(b) of the Act. In this background, the Supreme Court while dismissing the appeals against the State of Kerala held that in the case of beneficial exemptions, a literal formalistic interpretation of the statute at hand is to be eschewed; that the statute is to be construed in accordance with the object sought to be achieved. Similarly, in the Supreme Court decisions in the cases of Mangalore Chemicals & Fertilizers Ltd, Malwa Industries Ltd and North Eastern Tobacco Ltd, which have been relied upon by the Appellant, the common factor is concerning the interpretation of exemption notifications. The case before us is not about an exemption Notification but rather a beneficial notification extending concessional rate of tax subject to fulfillment of certain conditions. [Para 14]; + It is a settled issue that benefit under a conditional notification cannot be extended in case of non-fulfillment of conditions and/or non-compliance of procedure prescribed therein. The basic rule in interpretation of any statutory provision is that the plain words of the statute must be given effect to. It is only in the case of ambiguity that the principle of strict/liberal interpretation would arise. In this case , there is no ambiguity in the wordings of the impugned Notification. The conditions required to be complied with by the registered supplier and the registered recipient are very clear and does not give any scope for interpretation. The Supreme Court in the case of Commissioner of Central Excise, Chandigarh I vs Maahan Diaries reported in 2004 (166) ELT 23 (SC) has observed that it is settled law that in order to claim benefit of a Notification a party must strictly comply with the terms of the Notification. If on wordings of the Notification the benefit is not available then by stretching the words of the Notification or by adding words to the Notification, benefit cannot be conferred. Applying the ratio of this decision to the case before us, we find that there is no necessity of stretching the meaning of 'warehouse' referred to in the impugned Notification, to include a factory premises. One must not lose sight of the fact that this Notification was introduced only to provide relief to merchant exporters under the GST regime. The merchant exporters have the option to avail the benefit of this concessional rate and export the goods under LuT and later claim refund of the concessional rate of tax paid on their procurements. However, they can choose to export the goods on payment of IGST in which case , they will not be eligible to avail the benefit of concessional rate of tax under this Notification on their procurements. The CBIC vide Circular No 125/44/2019 GST dated 18-11-2019 has also clarified that the benefit of supplies at concessional rate if tax in terms of Notification No 40/2017-Central Tax (Rate) and Notification No 41/2017 Integrated Tax (Rate) is subject to certain conditions and the said benefit is optional. The option may or may not be availed by the supplier and/or recipient and the goods may be procured at the normal applicable rate of tax. Therefore, we agree with the ruling passed by the lower Authority that the Appellant is not eligible for the benefit of the concessional rate of tax in terms of Notification No 41/2017-IT (Rate) dated 23-10-2017 in as much as they have not complied with the conditions of the Notification. [Para 15].

- In favor of Revenue: AAAR

2022-TIOL-401-CESTAT-MUM

CCE Vs Onkar Furniture

CX - Limitation - A ppellant is engaged in the business of interior designing and furnishing - They undertake contracts for the said purpose, which inter alia includes manufacture of various furniture items at site - The impugned demands stand confirmed against the appellant by arriving at a finding that they have manufactured furniture and have cleared the same without payment of duty - SCN dated 29.12.2000 pertains to the period October 1996 to 1999-2000 and is covered by O-in-O 18/2008 dated 29.07.2008 and SCN dt. 09.07.1998 pertains to the period 1993-1994 to 1997-1998 and is covered by O-in-O no. 19/2008 dated 29.07.2008 - By relying on the Tribunal decision dated 14.01.2009 - 2009-TIOL-575-CESTAT-MUM in  identical  matter involving the same assessee but for the period April 1998 - September 1999, Bench while deciding the Stay application on 06.05.2009 held [ 2009-TIOL-992-CESTAT-MUM that prima facie, it appeared that the demands are to be restricted to the normal period of limitation; that the demands beyond normal period of limitation are time barred and accordingly dispensed with the requirement of pre-deposit (except the amount of Rs.3,50,000/- already paid) and stayed recovery thereof pending disposal of the appeals - Final hearing of the Appeals held on 14.03.2022.  Held: Bench notes that the Tribunal in its order dated 14.01.2009 - 2009-TIOL-575-CESTAT-MUM had held that the same reasons which are applicable for non-imposition of penalty are applicable for non-invocation of larger period of limitation and, therefore, the demand needs to be re-adjudicated for the normal period moreso since Revenue had not challenged the findings of Commissioner (Appeal) in this regard - Bench, therefore, with the consent and concurrence of both the parties, instead of remanding the case back,  invokes Rule 41 of the CESTAT (Procedure) Rules, 1982, in putting an end to the litigation that commenced way back in the early 1990s only for the purpose of re-computation of the normal period demand when from the evidence on record it is quite evident that appellant had already paid Rs.3,50,000/- during investigation which is much higher than the entire demand raised for the normal period and which would also meet the interest component - Bench does not intend that the matter goes back after 29 years to the original authority for re-computation - Appellant is estopped from claiming/seeking refund of the balance amount, if any - Appeal of assessee partly allowed and Revenue appeal is dismissed: CESTAT [para 8, 9]

- Assessee appeal partly allowed/Revenue appeal dismissed: MUMBAI CESTAT

2022-TIOL-400-CESTAT-DEL

CCGST & CE Vs Blue Whale India Pvt Ltd

CX - The assessee purchased pan masala in bulk from M/s Unicorn Industries who repacked it into smaller pouches and exported it - It is undisputed that the process of packing and repacking pan masala amounts to manufacture - As manufacturer, assessee took CENVAT credit of excise duty paid by M/s Unicorn - The SCN proposes to re-assess the duty paid by M/s Unicorn thereby lowering the duty liability of M/s Unicorn and thereby the CENVAT credit admissible to assessee - Two issues have to be decided; first issue is if duty is paid on a particular value at supplier's end, can that value be challenged or modified at the end of recipient of the goods - When Central Excise Duty has been paid, CENVAT credit on the same cannot be questioned at receiver's end - The Commissioner was, therefore, correct in rejecting proposal to deny CENVAT credit because undisputedly the duty was paid and goods were received and they were used in manufacture of final products by assessee - There is no authority of law under which DGCEI has the power to decide at what price goods should be sold by any assessee and what is a reasonable profit margin - The scheme of Notification available for manufacturer in Sikkim provides for refund of entire duty paid and also allows CENVAT credit to the buyer - It does not confer any power on DGCEI to modify or reduce CENVAT credit of duty paid by supplier - The second question is regarding assessable value of final products exported by assessee - While Central Excise Act and the Customs Act provide for assessment based on transaction values subject to some exceptions, SCN has been issued by DGCEI replacing the transaction value with values which it considers fair and proper assuming not only the power of deciding what is a fair assessable value but also seeking to deny CENVAT credit available to buyer by re-determining the value at the end of supplier contrary to not only to judicial precedents but also Board's Circular - This is beyond the powers conferred even on Superintendent of Central Excise who has mandate to scrutinise returns, let alone officers of DGCEI who have no jurisdiction even to scrutinise the Central Excise Returns for correctness - Impugned order is correct and calls for no interference: CESTAT

- Appeals rejected: DELHI CESTAT

2022-TIOL-399-CESTAT-AHM

Mahalaxmi Metal Udhyog Vs CCE

CX - Appellant is in appeal against confirmation of demand of duty and interest - Appellant was working under Notification No. 17/2007-C.E. which prescribed levy of Central excise at compounded rate on the basis of number of cold Rolling mills installed in factory - The joint reading of two clauses indicates that the observation of lower authorities that there is no provisions for abatement of duty for cease of work is misplaced - Clause 8 of Notification deals with the situations where factory ceases to work or reverts to normal procedure - The Clause 8 does not anywhere indicate if the ceasing of work of the factory is temporary or permanent - The clause 8 also prescribed the manner in which duty for the month in which ceasing of work happened is to be calculated - Notification No. 17/2007-C.E. does not require permanent ceasing of work in order to avail benefit of Clause 8 of Notification No. 17/2007-C.E. - Even temporary ceasing of work after following due procedure can entitle the manufacturer to avail; the exemption - Thus, the impugned order cannot be sustained: CESTAT

- Appeal allowed: AHMEDABAD CESTAT

2022-TIOL-398-CESTAT-AHM

J J Patel And Brothers Vs CCE & ST

ST - The issue under consideration is, whether the appellant is liable to pay Service tax on reimbursement of electricity charges received from service recipient - Identical issue involving identical contract has been decided by Tribunal in case of Pragati CNG 2021-TIOL-715-CESTAT-AHM by relying upon the decision in case of VV Brothers 2020-TIOL-146-CESTAT-AHM - In view of the said judgments, issue has been settled inasmuch as the electricity charges reimbursed to service provider by service recipient is not includible in gross value of service - Following the ratio of said judgment, demand is not sustainable - Accordingly, impugned order is set aside: CESTAT

- Appeal allowed: AHMEDABAD CESTAT

2022-TIOL-397-CESTAT-BANG

R K Marketing Services Vs CCE & C

ST - A SCN was issued to assessee proposing to classify the services undertook by it viz. excavation, extraction, loading, grading, sorting, crushing and screening of iron ore under taxable service of 'Business Auxiliary Service' under Section 65A of Finance Act, 1994, also proposing the service of transportation of iron ore by road in a goods carriage under GTA service under Section 65A ibid and thereby proposing to demand service tax and education cess on both the services along with applicable interest and penalties under Sections 76, 77 and 78 ibid - The classification of activities of assessee under BAS is no more res integra as the same is considered by very Bench of CESTAT in case of M. Ramakrishna Reddy 2008-TIOL-2337-CESTAT-BANG - Primary activity of appellant viz. winning minerals or raising iron ore from mines which was carried out through a separate contractor and as per the above order of this Bench, services relating to winning of minerals is held to be falling under category of 'mining services' which has become taxable w.e.f. 01/06/2007 - Period involved is April 2006 to October 2006 and hence, the demand cannot sustain - Impugned order is set aside: CESTAT

- Assessee's appeal allowed/Revenu's appeal dismissed: BANGALORE CESTAT

2022-TIOL-396-CESTAT-ALL

Jhoola Refineries Ltd Vs CCE

Cus - Assessee is in appeal against impugned order confiscating the imported crude palmolein oil under Section 111(o) of Customs Act, 1962, imposing a redemption fine under Section 125 ibid, demanding duty under section 28 ibid along with interest under section 28AB ibid and imposing penalties - The Supreme Court held that DRI officers were held to be not proper officers for issue of SCN demanding duty under Section 28 ibid in Canon India 2021-TIOL-123-SC-CUS-LB - Since the SCN itself was issued without authority of law, entire proceedings get vitiated - The ratio of Canon India was followed in several cases and demands were set aside by Supreme Court, various High Courts and this Tribunal only on the ground that the SCN was issued under Section 28 ibid by officers of DRI - Undisputedly, bills of entry were not assessed by officers of DRI but by the officers of Custom house - Only that officer who has assessed the Bills of Entry in the first place or his successor in office was 'the proper officer' who, if he was subjectively satisfied that some duty had escaped assessment, could have issued the SCN - As the SCN has been issued by officer of DRI who is not competent to issue it, the impugned order deciding such an SCN cannot be sustained - The impugned order is set aside: CESTAT

- Appeals allowed: ALLAHABAD CESTAT