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2023-TIOL-607-HC-DEL-GST
McDonalds India Pvt Ltd Vs Addl.CCGST
GST - Petitioner [McDonald's India Pvt. Ltd.] claims that the services rendered by it to McDonald's USA are 'zero rated supplies' under Section 16 of the IGST Act, 2017 - The appellant claims that during the period April 2018 to March 2019, it had provided services under the said Service Agreement without payment of IGST and thus, is entitled to refund of tax paid on inputs (ITC) - Adjudicating Authority held that the services rendered by the petitioner could not be considered as export of services as the same were intermediary services and, therefore, the place of supply of the said service was in India; that, therefore, the refund is not admissible – As the appellate authority rejected the petitioner's appeal, therefore, the present petition.
Held: It is material to note that the Show Cause Notice dated 14.08.2020 issued by respondent no. 2 did not specifically set out any reason in detail for denial of refund of ITC as claimed by the petitioner - The Show Cause Notice merely stated that "Place of provision appears to be in India; ITC availed appears to be not admissible as per CGST Act" - Rendering service on behalf of another person does not render the service provider an intermediary - However, it is essential that the principal service, the supplier of such services, and the service purchaser are identified to ascertain whether the services performed by the petitioner are those of a facilitator or one that arranges such services - The Order-in-Original has not analysed the services rendered by the petitioner on the aforesaid anvil - Bench finds no basis for the Appellate Authority to have concluded that the petitioner acts as a mediator between joint ventures/ franchisees and McDonald's USA - According to the Appellate Authority, the place of services supplied by the petitioner is in India, under Sections 13(3)(b) and 13(5) of the IGST Act - However, this was not the subject matter of controversy that had travelled to the Appellate Authority - There is no such allegation in the Show Cause Notice dated 14.08.2020 or the Order-in-Original - Bench finds merit in the contention that no such additional grounds for rejecting the petitioner's claim for refund could be raised suo motu by the Appellate Authority, in an appeal preferred by the petitioner - The impugned order is liable to be set aside on this ground alone - Bench finds it apposite to set aside the impugned order as well as the order passed by the Adjudicating Authority and remand the matter to the Adjudicating Authority to consider the petitioner's case afresh – Petition disposed of: High Court [para 20, 24, 25, 27, 28, 32]
- Petition disposed of: DELHI HIGH COURT
2023-TIOL-606-HC-DEL-CUS
Seville Products Ltd Vs CC
Cus - Appellant is essentially aggrieved by the levy of penalty under Section 112(a) of the Customs Act, 1962 - According to the officers of DRI, the evidence and material collected during the investigations established the allegation that confectionary items exported by the appellant and the Kelsen Group were cleared on the basis of false invoices reflecting values, which were lower than the real consideration paid by the importer for the said goods.
Held: The findings that the appellant had participated in the conspiracy with the importers for enabling them to avoid customs duty were upheld by the Appellate Authority as well as the Tribunal - Concededly, the concurrent findings of fact cannot be disturbed in these proceedings - Further, no attempt has been made by the counsel to submit to the contrary - The contentions that no penalty under Section 112(a) of the Customs Act can be imposed on the appellant as it is an overseas entity and the Customs Act does not have any extra-territorial operation, is unmerited - In the present case, the appellant was found to be complicit in clearance of the goods on the basis of false invoices issued by the appellant - It was also found that the appellant had collected part of the consideration for the goods in India, which was sent to it through hawala - The alleged offences have been committed within the territory of India - Thus, the contention that the levy of penalty under Section 112(a) of the Customs Act on the appellant was beyond the purview of the Customs Act is wholly misconceived - Contention that no penalty can be levied against the appellant since other co- noticees have settled the liability before the Settlement Commission is insubstantial - Appellant has been unable to point out any provision in the Customs Act, which would automatically extend the benefit of an order passed by the Settlement Commission in respect of a party, to other noticees as well - In the present case, the order was adjudicated by the Joint Commissioner of Customs and there is no dispute that he had the jurisdiction to adjudicate the question of levy of penalty under Section 122 of the Customs Act - Appeals are accordingly dismissed: High Court [para 18, 20, 23, 28, 31]
- Appeals dismissed: DELHI HIGH COURT
2023-TIOL-605-HC-DEL-CUS
Ganesh Sawant Vs CC
Cus - Being aggrieved by the Commissioner of Customs (Appeals) concluding the proceedings u/s 110(1D) of the Customs Act, 1962 without issuing any notice of the proceedings, the present petition is filed.
Held: Plainly, the relief, as sought for, cannot be granted - There is no infirmity in the notice dated 25.11.2022 issued under Section 150 of the Customs Act - The gold bar in question has since been disposed of and, therefore, no order can be passed directing the Commissioner of Customs (Appeals) to once again conduct the proceedings under Section 110(1D) of the Customs Act – Bench finds no merit in the contention (of counsel for Revenue) that no notice is required to be served of the proceedings under Section 110(1D) of the Customs Act - Sub-section (1D) of Section 110 of the Customs Act was introduced to substitute the authority before whom an application for certifying the correctness of the inventory; taking photographs of the seized goods; and drawing representative samples is required to be made - In respect of seized gold, the proper officer is required to make an application before the Commissioner (Appeals) having jurisdiction instead of the Magistrate as required under Sub-section (1B) to Section 110 of the Customs Act - Although the authority before whom an application is to be made was substituted, there was no amendment in the procedure to be followed - Decision in the case of Ishwar Parasram Punjabi ( 1990 (48) E.L.T. 224 (Del.) ) applies equally to proceedings under Section 110(1D) of the Customs Act - Although the petitioner is entitled to insist that the proceedings under Section 110(1D) of the Customs Act be conducted de novo - as directed by the Court in the case of Pradeep Khandelwal ( 2022 SCC OnLine Del 1294 ), no such orders are warranted in this case as the goods in question have already been sold - Petition is disposed of: High Court [para 10, 17, 19]
- Petition disposed of: DELHI HIGH COURT
2023-TIOL-604-HC-DEL-ST
Piyare Lal Hari Singh Builders Pvt Ltd Vs UoI
ST - Petitioner contends that the contracts executed by it are composite contracts, which entail provision of services as well as sale and purchase of goods; that since no machinery provision is available for separating the component relating to services in a composite contract, no service tax could be levied - It is also the petitioner's case that Clauses ( zzq ) and ( zzzh ) of Sub-section (105) of Section 65 of the Act are not applicable to composite contracts; the said clauses apply only where the activity entails rendering of taxable services "in relation to commercial or industrial construction" and in relation to "construction of complex".
Held : The question whether the composite contracts were taxable under service tax prior to 01.06.2007 is no longer res integra - The Supreme Court in the case of Larsen and Toubro Limited: = 2015-TIOL-187-SC-ST had referred to taxable services covered under Clause (g), ( zzd ), ( zzh ), ( zzq ) and ( zzzh ) of Section 65(105) of the Act and authoritatively held that the said taxable services referred only to service contracts simpliciter and not to composite works contracts - In view of the law laid down by the Supreme Court (supra), the impugned order-in-original dated 28.03.2012, which proceeds on the basis that composite contracts involving transfer of goods as well as services were covered under the taxable services under Section 65(105)( zzq ) and ( zzzh ) of the Act, cannot be sustained - Bench, therefore, sets aside the impugned order-in-original 28.03.2012 and remands the matter to the Adjudicating Authority to adjudicate the show cause notices afresh in light of the law laid down by the Supreme Court: High Court [para 11, 13, 14]
- Petition disposed of: DELHI HIGH COURT |
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