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2023-TIOL-611-HC-DEL-ST
Engineering Projects India Ltd Vs UoI
ST - Petitioner is engaged, inter alia, in the business of civil construction works -Adjudicating Authority confirmed the demand of service tax proposed under the show cause notice amounting to Rs. 4,91,85,132/- along with Cess, interest and penalty - The impugned order-in-original quantified the demand in respect of ten composite contracts - Petitioner, inter alia, challenges the order and seeks quashing of the same.
Held: The question whether the composite contracts were taxable under the service tax prior to 01.06.2007, is no longer res integra - The Supreme Court in the case of Commissioner, Central Excise and Customs, Kerala v. Larsen and Toubro Limited = 2015-TIOL-187-SC-ST had referred to taxable services covered under Sub-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 - Admittedly, the challenge raised by the petitioner to the validity of Sub-clause (zzq) and (zzzh) of Section 65(105) of the Act, is squarely covered by the decision (supra) - In view of the law laid down, the impugned order-in-original dated 30.11.2012, which proceeds on the basis that composite contracts involving transfer of goods as well as services were covered under the taxable services under Sub-clause (zzq) and (zzzh) of Section 65(105) of the Act, cannot be sustained - Impugned order is, therefore, set aside and the matter is remanded to Adjudicating Authority to adjudicate the show cause notices, afresh - Petition disposed of: High Court [para 7, 8, 9, 10]
- Petition disposed of: DELHI HIGH COURT
2023-TIOL-610-HC-DEL-CUS
Ajay Kumar Gupta Vs CC
Cus - Petitioner had arrived on a visit to New Delhi on 06.08.2021 - The petitioner was detained by the Custom Authorities and it was found that he was in possession of two wrist watches [Hublot Big Bang watch & Bvlgari Serpenti watch] valued at about Rs. 39,61,100/- - The petitioner was arrested on the allegation of smuggling and was released on bail - Wrist watches were seized on 07.08.2021 - After receipt of the order-in-original dated 28.12.2021, the petitioner deposited the penalty of Rs. 5,94,165/- as well as the redemption fine of an equivalent amount - The co- noticee also deposited the penalty of Rs. 7,92,220/- imposed on him - Notwithstanding that the petitioner and the co- noticee had deposited the penalties and redemption fine, the goods in question were not released by the respondents, therefore, the present petition seeking a direction to the respondent to release the goods for the purpose of re-export of the same.
Held : Counsel for Revenue submits that the Revenue has preferred a Revision Petition before the Revisional Authorities, which is pending; that in view of the pendency of the said proceedings, the goods in question have not been released - However, Counsel has been unable to point out any provision in the Customs Act, 1962, which entitles the Revenue to retain the goods after the concerned party has paid the redemption fine as well as the penalty as determined - Merely because the Revenue seeks to challenge the order passed by the Appellate Authority is no ground for non-compliance of the said orders - Respondents are directed to handover the goods in question to the petitioner (within a period of two working days) as Bench finds no justification for the respondent to withhold the release of the said goods - Petition allowed: High Court [para 10, 11, 13]
- Petition allowed: DELHI HIGH COURT
2023-TIOL-609-HC-DEL-GST
Zhudao Infotech Pvt Ltd Vs Principal Additional Director General
GST - Petitioner (ZIPL) operates a payment aggregator platform under the name 'Onion-Pay' - Petitioner impugns the orders dated October 2022 attaching their bank accounts - Petitioner also impugns the order dated 01.02.2023 passed by respondent no.1 in effect, rejecting the objections raised by them under rule 159(5) of the Rules, 2017 - Petitioner submits that the attachment of their ESCROW/Nodal account would result in effectively shutting down its business as it would no longer be able to operate the online platform - Respondents claim that information was received indicating that ZIPL was indulging in evasion of GST while providing an online payment gateway (Aggregator Services) under the trade name 'Onion-Pay'. The respondents allege that that ZIPL was supporting illegal gambling products such as 'Teen Patti', 'Roulette', 'Ludo', 'Matrix 5' and all merchants associated with the payment gateway were suspected to be fake and shell companies - Further, they allege that ZIPL had created a web of fake gaming merchant entities, which were operated and managed by ZIPL - It was claimed that a Chinese national named Jian Li was the Director of ZIPL and the mastermind in running the entire online gaming / gambling business - It is also alleged that certain contraventions of Foreign Exchange Management Act, 1999 (FEMA) were observed and the RBI has issued a compounding order on 24.06.2022; that ZIPL was operating the Nodal / Escrow accounts and providing payment aggregator / payment gateway services in violation of regulatory requirements stipulated by the RBI.
Held: The scope of the present proceedings is confined to determining whether the impugned orders are in accordance with Section 83 of the CGST Act - Directions issued by the RBI is not the subject matter of the present petition - The allegations, on the basis of which the impugned order attaching the petitioner's bank account were passed, center around the theme that some of the merchants using ZIPL's platform are fake - Counsel for Revenue has readily accepted that there is neither any demand nor any issue regarding ZIPL's liability under the CGST Act - ZIPL's bank accounts were attached mainly for attaching the assets of some of the merchants who were using ZIPL's platform - In view of the aforesaid submission that there is no issue regarding the CGST liability of ZIPL, it is apparent that ZIPL's bank accounts could not be attached for any amount due and payable to the merchants using the ZIPL's platform - The provisions of Section 83 of the CGST Act can be invoked for attaching the assets and bank accounts of a taxable person or a person specified under Section 122(1A) of the CGST Act, if in the opinion of the Commissioner it is necessary to do so for the purpose of protecting the interest of government revenue - Thus, the bank accounts of ZIPL cannot be attached for securing the revenue of another taxable person - It is implicit that the bank accounts and assets of only those taxable person or persons specified in Section 122(1A) of the CGST Act can be attached who may be liable for payment of any government revenue and the Commissioner is of the opinion that it is necessary to attach their assets in the interest of government revenue - A debt owed by any person to the taxable person, whose assets or bank accounts are liable to be attached under Section 83 of the CGST Act, can be attached being an asset of such a person - But the bank account of the person owing such debt cannot be subject to a provisional attachment order under Section 83 of the CGST Act - Court considers it apposite to dispose of the present petition by setting aside the impugned orders attaching ZIPL's bank accounts albeit with the further direction that ZIPL shall make payments due to various merchants directly in their respective bank accounts as disclosed by ZIPL to the respondents and as recorded in the impugned order dated 01.02.2023 - Petition is disposed of: High Court [para 19, 21, 24, 28, 31]
- Petition disposed of: DELHI HIGH COURT
2023-TIOL-608-HC-DEL-GST
Alex Tour And Travel Pvt Ltd Vs Assistant Commissioner, CGST
GST - Refund - Applications filed by the petitioner for refund of unutilised ITC were rejected, inter alia, on the ground that the services provided by the petitioner were intermediary services and did not qualify for export of services - The respondent also raised an issue regarding non-furnishing of Foreign Inward Remittance Certificate (FIRC) - Appeals were allowed by the appellate authority - Appellate authority also accepted the petitioner's contention that in case of voluminous transactions of export of services to customers located outside India, submission of transaction-wise FIRCs were not feasible - Notwithstanding that the petitioner has succeeded before the appellate authority, the respondent has not processed the petitioner's claim for refund - Inasmuch as the respondent states that after the appellate authority had passed the Orders-in-Appeal, Deficiency Memos and Show Cause Notices were issued and since the petitioner did not respond to the said Show Cause Notices or Deficiency Memos, the claim for refund has not been processed - Counsel for the Revenue further submits that the decision of the appellate authority is erroneous and the Revenue proposes to file appeals against the Orders-in-Appeal as and when the Appellate Tribunal is constituted.
Held : Undisputedly, the Revenue is entitled to file an appeal under Section 112 of the Act, 2017 , within a period of three months from the date of the order - Appellate Tribunal has not been constituted as yet, however, the respondent cannot refuse to comply with the appellate orders on this ground - Bench is unable to accept that the Revenue can ignore an order passed by the appellate authority on the ground that it proposes to appeal the said order - There is no order passed by any competent Court, staying the implementation of the Orders-in-Appeal passed by the appellate authority - The Revenue has also taken no steps for securing orders to that effect - Petitioner is also be entitled to interest in accordance with law - The respondent is directed to forthwith disburse the petitioner's claim for refund along with interest as payable in accordance with law - Petition is allowed: High Court [para 17, 18, 19, 24, 25]
- Petition allowed: DELHI HIGH COURT |
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