TODAY'S CASE (INDIRECT TAX)

October 15, 2024

++ GST - When once proceedings have been initiated under KGST Act which culminated in adjudication order, parallel/dual proceedings under CGST Act sought to be initiated by issuing SCN under Section 122 of CGST Act are clearly barred and impermissible in law: HC

++ Cus - In the absence of any specific provisions, Cost Recovery Charges cannot be recovered: CESTAT

October 14, 2024

++ GST - Cross-utilization of Input Tax Credit credited to the Electronic Credit Ledger, between CGST and SGST is not allowed: HC

++ GST - The petitioner having not produced books of accounts in first round of litigation cannot be heard to contend that Assessing Officer cannot look into books of accounts when it is produced pursuant to remand: HC

++ CX - As per trite law, if relevant rules for invoice issuance are satisfied, Cenvat credit should not be denied due to ISD's registration status: CESTAT

October 11, 2024

++ GST - Impugned order was passed in violation of principles of natural justice since it is just and necessary to provide an opportunity to the petitioner to establish their case on merits - Matter remanded subject to petitioner paying 15% of disputed tax: HC

++ GST - SCN for recovery of any tax, interest and/or penalty is required to be issued to the legal representative or such other person, who is carrying on the business of the deceased taxpayer - SCN issued to a deceased person is set aside: HC

++ GST - SCN is economical in explaining the proposal for cancellation of registration - Suspension of a taxpayer's GST registration has wide adverse ramifications for the business of the taxpayer - As petitioner has now complied with rule 86B, registration to be restored: HC

++ GST - Since only a SCN has been issued, it is premature for the petitioner to challenge the same by approaching Court: HC

++ Cus - Oil contained in bunker tanks in engine room of vessel imported for breaking up is to be assessed as part of the Ship: CESTAT

++ CX - If appellant dispute the statements which are relied upon for adjudication, it is incumbent on adjudicating authority to allow the cross-examination of witnesses, matter remanded for passing a fresh order after allowing cross-examination of witnesses: CESTAT

++ ST - As appellant has recovered electricity charges on actual basis, no service tax is payable by appellant as appellant has not earned any profit for providing electricity: CESTAT

++ ST - Assessee obtained OC for a residential project developed by it & sold the same day; hence no Service Tax payable thereon as per Notfn No 09/2013-ST: CESTAT

October 10, 2024

++ NDPS - Heroin presents a significantly graver threat to public health and individual well-being as compared to cannabis - Commercial quantity recovered - Applicant, being a foreign national, can prove to be a flight risk - Bail application dismissed: HC

++ GST - Services by way of reinsurance of the insurance schemes - When impugned order was passed, clarificatory Circular 228/2024 was not in existence - Demand would not sustain in the light of stand taken by respondents: HC

++ GST - Rule 86A - Blocking of ECL - No pre-decisional hearing was provided - No independent or cogent reasons offered but reliance placed on reports of enforcement authority - Order based on borrowed satisfaction cannot sustain: HC

++ GST - As per agreement, cost of fuel was to be borne by recipient - This cost cannot, therefore, be subjected to charge of GST by adding its value in the transaction value of GTA service: HC

++ GST - Remanding a matter to the authority concerned has the effect of providing further time of two years for the adjudicating authority to adjudicate: HC

++ GST - SCN does not specifically propose cancelling registration with retrospective effect - Decision of proper officer to cancel registration with retrospective effect, therefore, falls foul of principles of natural justice: HC

++ GST - ITC refund - Although the appellate authority has faulted adjudicating authority in not addressing the question of reconciliation statement, the appellate authority has also not addressed the same - Matter remanded: HC

++ VAT - Penalty u/s 51(7) of Punjab VAt Act can be exercised by AO only after reaching conclusion that there was attempt to evade tax after actual valuation of goods: HC

++ Cus - Department ought not to have relied on NIDB data without providing copies to appellant, enhancement of value is without any legal or factual basis: CESTAT

++ CX - Salmonella Antigens Sets are classifiable under Heading No. 3002, as it aligns with the definition of diagnostic kits: CESTAT

++ ST - Non-speaking O-i-O passed without considering documents submitted by assessee during adjudication, solely because assessee did not present its case properly; case remanded for re-adjudication: CESTAT

October 09, 2024

++ GST - Composite supply of catering services within the club premises along with renting of premises attracts tax @5% without ITC: AAR

++ GST - 'Baby Carriers with Hip seat' is not covered by HSN code 8715 but is correctly classifiable under HSN 6307 90: AAR

++ Cus - Refund of SAD - Date of making refund application would be required to be considered from the date of final assessment and not from the date of payment of provisional duty: HC

++ GST - As Appellate Authority has dismissed appeals, respondent authorities will not be able to exercise revisional power - Order passed by AA as well as order of cancellation of registration is set aside and matter remanded to assessing officer at SCN stage: HC

++ GST - Proceeding is set aside only on the ground that it was completed against a deceased person - It is clarified that the de-novo adjudication can be culminated against the legal heir: HC

++ GST - Challenge to Notfn No. 56/2023, as it extends time limits for assessments beyond previously established deadlines - Notfn fails to meet requirements of Section 168A of CGST Act - Department estopped from enforcing impugned order until further proceedings: HC

++ GST - 37-day delay in filing appeal is condoned where the Petitioner was unaware of the impugned order & thus deserves proper opportunity to present its case: HC

++ Cus - In case of re-export of goods, the adjudicating authorities do not have power to impose any redemption fine : CESTAT

++ ST - Exemption of Notfn 25/2012-ST is clearly admissible to appellant as it is the appellant who run the canteen in factory which is covered by Factory's Act, 1994 : CESTAT

October 08, 2024

++ GST - Yatri Sathi App - Applicant, though qualifies the definition of being an e-commerce operator, does not satisfy the conditions of Section 9(5) of the Act for discharging tax liability by an electronic commerce operator: AAR

++ GST - Purchases of second hand gold jewellery from individuals who are not registered under GST would not amount as supply of goods or supply of services and applicant is not liable to pay tax on reverse charge basis: AAR

++ GST - Affordable housing - 3/2019-CTR - Services by way of extending loans by HDFC Bank to applicant against consideration payable in the form of interest is an inward supply of exempted services - Services would be a part of total inward supply for computing threshold limit of 80%: AAR

++ CX - Penalty - Rule 26 - SCN and OIO have explained in detail about the nature of offence for which penalty is levied - No breach of any requirement for levy of penalty: HC

++ GST - KHOL is exempted - End use of the product at the end of the purchaser is not the concern of the assessee and cannot be the consideration for classifying the goods in question: HC

++ CX - Spirits are denatured to be rendered unfit for human consumption - commodity tax in Constitutional scheme excludes Union's jurisdiction on spirits for human consumption - Excise tax applies to all spirits not intended for human consumption: CESTAT

++ CX - Molasses used captively for manufacturing Undenatured ethyl alcohol, are exempt from tax - tax demand raised thereon is not sustainable: CESTAT

++ Cus - Unless it is established that royalty is paid as a condition of sale, it cannot be included in assesable value: CESTAT

October 07, 2024

++ Sales Tax - Benefits from exchange rate fluctuations do not transform receipts therefrom into something other than taxable turnover: HC

++ Cus -SAD refund - Date of making refund application would be required to be considered from date of final assessment and not from date of payment of provisional duty: HC

++ GST - Non-payment of dues for a period of three months is not a prescribed ground u/s 29 and/or u/r 21 for cancelling the petitioner's GST registration: HC

++ GST - Notices issued to an assessee, who is no more and assessment orders passed based on such notices are void ab initio and liable to be set aside: HC

++ GST - Cancellation of registration is invalidated where specific reason as to alleged fraud, wilful misstatement or suppression of facts is not stated in Show Cause Notice & no further information is given to justify such action: HC

++ Cus - In absence of evidence to establish that appellant was aware of presence of branded products in consignment when bills were filled, goods are not liable for confiscation and no penalty under section 112 of Customs Act, 1962 can be imposed.

++ CX - Assessee eligible for self-credit of taxes paid in past periods, where conditions in Notification No. 20/2007-CE, as amended by Notification No. 20/2008-CE are satisfied: CESTAT

++ ST - Sale of immovable property is excluded from definition of service u/s 65B(44) of Finance Act, 1994; Such exclusion aligns with Constitutional mandate under Article 366(29) & cannot be deemed to be validly legislated rule in light of Section 38A of the Central Excise Act, which applies to Service Tax matters: CESTAT

++ ST - Construction of residential complex service - Assessee's claim for refund of tax paid rightly denied on grounds of unjust enrichment, where assessee passed tax incidence onto consumers: CESTAT

++ Cus - Penalty imposed on CHA on allegations of clandestine clearance of imported goods, is not tenable, where no evidence exists to establish CHA's role in improper removal of goods: CESTAT

October 05, 2024

++ GST - Penalty imposed is harsh and unreasonable - Petitioner, who is the owner of the goods, can be imposed with penalty equal to twice the amount of tax imposed and not 100 percent of value of goods: HC

++ GST - Order cannot be sustained even for a minute  for the simple reason that apart from mentioning the SCN and the reply filed and stating that the officer has examined the reply, no reasoning has been given: HC

++ GST -  Reasons are the soul of a decision and in absence thereof, the order cannot be justified: HC

++ GST - Shocking that registration is cancelled without assigning any reason - Total non-application of mind - Order set aside: HC

October 04, 2024

++ GST - Assessee issued multiple SCNs & in which issues raised were overlapping - resultant confusion deprived assessee of fair opportunity to respond thereto - case remanded for de novo hearing, conditional on pre-deposit of tax: HC

++ CX - 50% of Cenvat credit can be availed in first year of availment & there is no time limit for availing the remaining 50% credit; balance can be claimed in subsequent FYs: CESTAT

++ CX - late availment of credit does not contravene CCR, 2004; provisions of Notfn No. 20/2007-C.E. do not override provisions of CCR: CESTAT

October 03, 2024

++ GST - whether construction of immovable property constitutes a 'plant' - SC refrains from final determination of issue; remands matter to High Court; emphasizes need to probe each case on merits & by using Functionality test - Clauses (c) & (d) of Section 17(5) not found to be discriminatory: SC

++ GST - To give plain interpretation to clause (d) of Section 17(5), the word 'plant' will have to be interpreted by applying the functionality test: SC

++ GST - If a building in which premises are situated qualifies for definition of plant, ITC can be allowed on goods & services used in setting up such plant: SC

++ GST - Right to ITC is conferred solely by the statute; no one can claim ITC as a matter of right unless it is expressly provided in the statute - Legislature reserves right to carve out exceptions to entitlement of ITC u/s 16 of CGST Act: SC

++ GST - That provisions could have been drafted in a better manner or more articulately, is not sufficient to attract arbitrariness: SC

++ CX - It is clear that by a resolution process, the company continues its business and only by a liquidation process, the business of the company would be wound up - Tribunal ex facie erred in holding that by virtue of Rule 22 of CESTAT (Procedure) Rules, 1982, appeal would abate: HC

++ CX - Revenue not having made any claim before IRP during CIRP process and the demand not having been part of the resolution plan, same has stood extinguished and cannot be continued: HC

++ GST - Cancellation of Registration on the pretext of violation of Rule 86B is a disproportionate punishment: HC

++ GST - Rule 86B of the Act has no statutory backing and appears to be ultra vires the provisions of the Act, 2017: HC

++ GST - It shocks the conscience of the Court to find an extreme penalty of the nature of cancellation of Registration being imposed on the basis of a 'prima facie' investigation conducted: HC

++ GST - Notice is dated 04.04.24, therefore, order should have been passed at least on 12.04.24, 11 th being a public holiday - Authority having delayed the matter, mandate of s.129(3) not followed - Order set aside: HC

++ GST - Registration was cancelled and, therefore, petitioner could not access notices uploaded on portal - Consequently, they failed to file reply and impugned order was passed - Liberty granted to petitioner to file appeal: HC

++ GST - Petitioner did not file any appeal but approached Court when recovery notices were issued - Liberty given to file appeal subject to payment of Rs.5000/- in each petition by way of DD favouring Government Yoga and Naturopathy Medical College: HC

++ GST - There is no provision where CBIC is required to issue clarifications on separate queries raised by taxpayers directly: HC

++ GST - Assessment order passed without granting assessee an opportunity of personal hearing, as SCNs were directly uploaded onto GST portal & assessee did not know about them: HC

++ GST - Department raised demand notice & attached assessee's bank account, without allowing opportunity of personal hearing - assessee to pre-deposit 10% of tax amount, whereupon attachment would be lifted: HC

++ ST - Grant-in-aid received by assessee from Government of India is not taxable under category of Commercial Coaching or Training Service: CESTAT

++ CX - Allegations of bogus tax invoice scheme - Penalty imposed under Rule 25 exceeds statutory provisions & lacks justification, hence is set aside: CESTAT

++ Cus - As there was no allegation that appellant had active involvement in the incident, penalty imposed under Section 114 (i) of Customs Act, 1962 is not sustainable: CESTAT

October 01, 2024

++ GST - Appellants are to be blamed as they did not respond to SCN by submitting reply, nor produced any documents before adjudicating authority and were not diligent in filing appeal within statutory period of limitation - Nonetheless, one more opportunity is granted to appellants - Matter remanded: HC

++ GST - Appellate authority has suo motu enhanced the tax liability without following the procedure prescribed u/s 107(11) of the Act - Order set aside and matter remanded: HC

++ GST - So that the petitioner can avail AMNESTY Scheme u/s 128A which is to be launched on 1st November, 2024, respondent is directed to issue separate SCNs regarding the six assessment years: HC

++ GST - Respondents are supposed to have considered bonafide of petitioner - Registration was cancelled in a mechanical manner and this would ultimately affect revenue - Order set side and registration restored: HC

++ ST - CENVAT credit would be admissible to the appellant on tower materials and pre-fabricated shelters: CESTAT

++ ST - As per settled precedent, construction services provided to educational institutions cannot be brought under tax bracket: CESTAT

++ Cus - Enhancement of valuation based on royalty paid to parent-company abroad, is invalid - Royalty payment not demonstrated to have influenced price of imported goods, or that royalty was a condition for sale - No flowback traced to parent company: CESTAT

++ Cus - Appellant-importer's attempt to postpone duty collection until domestic sale & repacking under a trademark, is speculative & unrelated to Ccustoms duties: CESTAT