Voluntary Statement Made Before The Revenue Authorities Cannot Substitute A Statutory Pre-Show Cause Consultation Notice: Delhi High Court

Case Title: Gulati Enterprises versus Central Board of Indirect Taxes and Customs & Ors.

Citation: 2022 LiveLaw (Del) 604

The Delhi High Court has reiterated that a voluntary statement made before the revenue authorities cannot substitute a statutory pre-show cause consultation notice, as contemplated under Rule 142(1A) of the CGST Rules, 2017, as it stood before 15.10.2020.

The Division Bench of Justices Rajiv Shakdher and Tara Vitasta Ganju dismissed the contentions of the revenue department that because the petitioner's authorized representative gave a voluntary statement before the concerned officer, the need for issuing a pre-show cause consultation notice was waived.

Madras High Court

No Demand Of GST, Interest And Penalty Can Be Made In Form DRC-01A Without Issuance of Section 74(1) Notice: Madras High Court

Case Title: M/s.Anantham Retail Private Limited Versus State Tax Officer

Citation: 2022 LiveLaw (Mad) 283

While quashing the assessment order, the Madras High Court held that a demand for GST, interest, and penalty on Form DRC-01A cannot be made without the issuance of a notice under Section 74(1) of the CGST Act.

The single bench of Justice M.Nirmal Kumar has observed that the department/respondent has not followed the procedure. After the issuance of notice on Form DRC-01A, the department issued Form GST DRC-01A. If the petitioner has any objections and has not paid the tax as determined, a show cause notice must be issued under Section 74(1) of the TNGST Act. After receiving objections and giving an opportunity of personal hearing, the assessment order ought to have been finalised.

Officers Of DGGI Are "Central Excise Officers"; Can Issue Show Cause Notices And Adjudicate Service Tax Demand: Madras High Court

Case Title: M/s. Redington (India) Limited versus Principal Additional Director General

The Madras High Court has ruled that officers of the Directorate General of GST Intelligence (DGGI) are "Central Excise Officers" for the purpose of Rule 3 of the Service Tax Rules, 1994 since they are vested with the powers of Central Excise Officers by the Central Board of Excise and Customs (CBEC).

The Single Bench of Justice C. Saravanan, while considering a bunch of writ petitions, held that that the definition of "Central Excise Officer" in Section 2(b) of Central Excise Act, 1944 is expansive and that any person, including an officer of the State Government, who is invested by the CBEC with any of the powers of a Central Excise Officer under the Central Excise Act, is a "Central Excise Officer".

Madras High Court Allows Re-Exportation Of Betelnut Products Subject To Execution Of A Bond To Cover Value Of Goods

Case Title: The Assistant Commissioner of Customs - Imports, Custom House Versus M/s. Mahadev Enterprises

Citation: 2022 LiveLaw (Mad) 286

The Madras High Court bench of Justice S.S. Sundar and Justice S.Srimathy has allowed the re-exportation of betelnut products subject to the execution of a bond to cover the value of the goods.

Madras High Court Dismisses Plea Alleging Harassment By GST Department

Case Title: Sridhar Versus The Superintendent of GST

Citation: 2022 LiveLaw (Mad) 287

The Madras High Court has dismissed the petition alleging harassment by the GST department.

The single bench of Justice N. Sathish Kumar has observed that the term "harassment" is so subjective that it cannot be encapsulated in an objective criterion. The petitioner, having given a complaint, is bound to cooperate with the police for an inquiry.

Reopening of IT Assessment By Officer Having No Jurisdiction: Madras High Court Invalidates Proceedings

Case Title: Charu K. Bagadia Versus Assistant Commissioner of Income Tax-23(2), Mumbai

Citation: 2022 LiveLaw (Mad) 292

The Madras High Court invalidated the reassessment procedures on the basis that the reopening of the income tax assessment was conducted by an officer without jurisdiction.

The division bench of Justice R. Mahadevan and Justice J.Sathya Narayana Prasad has observed that the ACIT Mumbai, who recorded the reasons for reopening the assessment, has no jurisdiction over the appellant, to issue a notice dated 28.03.2018. Though the files pertaining to the reassessment proceedings of the appellant were transferred, the ACIT Chennai has no authority to continue the reassessment proceedings. Hence, the notice issued by him was also held to be invalid.

Karnataka High Court

No Suppression Of Facts, Show Cause Notice Based On Balance Sheet: Karnataka High Court

Case Title: Commissioner of Central Tax Vs ABB Limited

Citation: 2022 LiveLaw (Kar) 245

The Karnataka High Court bench of Justice P.S. Dinesh Kumar and Justice Anant Ramanath Hedge has held that the assessee is not liable for the suppression of facts as the show cause notice was issued on the basis of the disclosures made in the balance sheet.

Limitation Period Is Not Applicable On Refund Of Service Tax Wrongly Paid: Karnataka High Court

Case Title: M/s Bellatrix Consultancy Services Versus The Commissioner of Central Tax

The Karnataka High Court bench of Justice P.S. Dinesh Kumar and Justice Anant Ramanath Hedge has held that the limitation period is not applicable to a refund of service tax wrongly paid.

Calcutta High Court

Calcutta High Court Sets Aside The Order Of Asst. commissioner, GST, For Not Complying Natural Justice

Case Title: Suraj Singh Vs. Assistant Commissioner

The Calcutta High Court bench of Justice Md. Nizamuddin has held that an order passed without granting a personal hearing violates principles of natural justice.

Interest Component Of EMI Of Loan Availed On Credit Card Is Not Exempt From IGST: Calcutta High Court

Case Title: Ramesh Kumar Patodia versus Citi Bank Na and Ors.

The Calcutta High Court has ruled that the interest component of the Equated Monthly Instalments (EMIs) of a loan advanced by a bank on a credit card is not exempt from IGST.

The Single Bench of Justice Hiranmay Bhattacharyya held that the services rendered by the bank by way of extending loans amounted to credit card services and hence, the interest component of the EMI of the said loan was interest involved in credit card services, which is excluded from the exemption conferred under Notification No. 9/2017 - Integrated Tax (Rate), dated June 28, 2017.

Orissa High Court

Non-Submission Of Certified Copy of GST Order Appealed Against Within 7 Days Is A Mere Technical Defect:Orissa High Court

Case Title: M/s Atlas PVC Pipes Limited Versus State of Orissa

The Orissa High Court has held that the non-submission of a certified copy of the GST order appealed against within 7 days is a mere technical defect.

The division bench of Justice Krushna Ram Mohapatra and Justice Murahari Shri Raman has observed that on the altar of default in compliance of a procedural requirement, the merit of the matter on appeal cannot be sacrificed.

Rajasthan High Court

Rajasthan High Court Grants Bail To Person Accused Of GST Evasion

Case Title: Kamal Chand Bothra Versus Union Of India

The Rajasthan High Court bench of Justice Narendra Singh Dhaddha has granted bail to the person accused of GST evasion of Rs. 8.64 crore. The court directed that the petitioner be released on bail provided he furnishes a personal bond in the sum of Rs.50,000 with two sureties of Rs.25,000 each.

GST Circular Contra To GST Act, Can't Deny The Claim For ITC refund; Rajasthan High Court

Case Title: Baker Hughes Asia Pacific Limited Vs Union of India

The Rajasthan High Court has held that the GST circular dated 31.03.2020, repugnant to the parent legislation, cannot be applied to oust the legitimate claim for an accumulated ITC refund.

The division bench of Justice Sandeep Mehta and Justice Vinod Kumar Bharwani has observed that the supplying dealer would be entitled to claim a refund of accumulated unutilised tax credit under Section 54 (3) (ii) of the CGST Act irrespective of the fact that the input and output supplies are the same by ignoring the circular dated 31.03.2020.

Levy Of GST On Mining Royalty: Rajasthan High Court Grants Interim Protection To Petitioners

Case Title: Shree Basant Bhandar Int Udyog v. Union of India

The Rajasthan High Court has granted stay on recovery of GST on royalty paid by the Petitioners on mining activity.

The order comes in a bunch of writ petitions filed primarily involving the issue of permissibility of raising demand of GST on royalty. The petitioners in these petitions challenged the notifications whereby, royalty paid by them on mining activity is being subjected to GST and/or notices issued for alleged incriminating discrepancies in returns after scrutiny and analogous proceedings.

Madhya Pradesh High Court

Madhya Pradesh High Court Directs Department To Issue Fresh Reassessment Order For Not Considering Reply

Case Title: Agrawal Petrolium Co. Vs PCIT

The Madhya Pradesh High Court bench of Justice Sujoy Paul and Justice Prakash Chandra Gupta has held that the reassessment order was passed without considering the reply to the show cause notice and directed the department to pass a fresh order.

ITAT

Sale Of Renewable Energy Certificate Of Income Received By The Assessee Is A Capital Receipt: ITAT

Case Title: Essel Mining & Industries Limited Versus Dy. CIT

The Mumbai Bench of the Income Tax Appellate Tribunal (ITAT) has held that the sale of renewable energy certificates (carbon credit) of income received by the assessee is a capital receipt.

The two-member bench of Kuldip Singh (Judicial Member) and Gagan Goyal (Accountant Member) has observed that the sale of carbon credit could not be a business receipt or income, nor is it directly linked with the business of the assessee, nor any asset is generated in the course of business, but it is generated due to environmental concern.

Imparting Skill Development Is Akin To Providing Education, Eligible For Section 12AA Registration: ITAT

Case Title: C. R. Dadhich Memorial Society Versus CIT(E)

The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) consisting of Yogesh Kumar U.S. (Judicial Member) and B.R.R. Kumar (Accountant Member) has held that the assessee is eligible for registration under section 12AA of the Income Tax Act for imparting skill development, which is akin to providing education.

ITAT Directs AO To Allow Depreciation On Molasses Tanks By Making The Correct Computation Of New Assets

Case Title: Sasamusa sugar works pvt. Ltd. Vs DCIT

The Kolkata Bench of the Income Tax Appellate Tribunal (ITAT), consisting of Aby T Varkey (Judicial Member) and Girish Agarwal (Accountant Member), has directed the assessing officer to allow the depreciation on molasses tanks by making the correct computation of new assets.

Approval Of Demerger Would Not Entail The Benefit Of Set-Off Under Section 72A Of Income Tax Act: ITAT

Case Title: DCIT versus M/s. Cummins Sales & Services (I) Ltd.

The Pune Bench of ITAT has ruled that the mere fact that the scheme of demerger or amalgamation was approved by the High Court, does not automatically entitle the assessee to claim the set-off of brought forward business losses relating to the demerged or amalgamating undertaking.

The Bench, consisting of S. S. Viswanethra Ravi (Judicial Member) and Inturi Rama Rao (Accountant Member), held that Section 72A (5) of the Income Tax Act, 1961 has been enacted empowering the Assessing Officer to deny the benefit of set-off of brought forward business losses, and hence, merely because the scheme of demerger was approved by the High Court would not ipso facto entitle the assessee to the benefit of set-off, if the scheme was contrary to the objects behind the enactment of the provisions of Section 72A.

CESTAT

Limitation Period Is Not Applicable On Personal Ledger Account: CESTAT

Case Title: Sun Pharmaceutical Industries Ltd Vs C.C.E. & S.T.

The Ahmedabad Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has held that the limitation period is not applicable on personal ledger accounts (PLA).

The bench of Ramesh Nair (Judicial Member) has observed that in the case of PLA balance, it is not deposited as a duty but it is deposited as an advance towards the duty. The PLA amount takes the colour of excise duty only when it is utilised for payment of duty on clearance of excisable goods. The unspent balance of the PLA is only an advance, not a duty. Therefore, Section 11B is not applicable.

Exporter Not liable For 'Change Of Landing Port' Instructions Given By Importer: CESTAT

Case Title: Janki Dass Rice Mills Versus C.C.-Mundra

The Ahmedabad Bench of the Customs, Excise and Service Tax Tribunal (CESTAT) has ruled that the exporter is not responsible for the instructions given by the importer regarding the change in the port after the issuance of a "Let Export Order" by the customs authority.

The two-member bench of Ramesh Nair (Judicial Member) and Raju (Technical Member) has observed that the appellant lost the ownership of the goods as soon as the "let export order" was issued by the Customs authorities. After the export order, it was the responsibility of the shipping lines to ship the goods to the foreign buyer, with the exporter having no control over the goods. Hence, the appellant cannot be held responsible if the importer situated in Iran had given instruction to change the port from Bandar Abbas port to Jabel Ali port. After the "let export order" was issued by the Customs authorities, it was the importer in Iran who became the owner of the goods.

AAR

E-Rickshaw Sold Without Battery Classifiable As An "Electrically Operated Motor Vehicle" :West Bengal AAR

Applicant's Name: Rohit Singh Kharwar

The West Bengal Authority of Advance Ruling consisting of Brajesh Kumar Singh and Joyjit Banik has ruled that a three-wheeled electrically operated vehicle, commonly known as an e-rickshaw, when supplied without a battery, is classifiable as an "electrically operated motor vehicle" under HSN 8703.

Contracts With Municipalities Towards Supply Of Solid Waste Management, Except Bio-CNG Is Exempted From GST: AAR

Applicant's Name: Srinivas Waste Management Services Private Limited

The Tamil Nadu Authority of Advance Ruling (AAR) has ruled that contracts with municipalities towards supply of solid waste management, except Bio-CNG carried on at the Central Asphaltic Plant for the Greater Chennai Corporation, are exempted from GST.

The two-member bench of G. Venkatesh and K. Latha has ruled that contracts entered into with various city corporations and municipalities towards the supply of pure services towards the removal of legacy waste dumped at dump sites through the bio-mining process are exempted from GST.