Delhi High Court Stays Reassessment Order Based On Internal Audit Objection

Case Title: Kum Kum Kohli Versus ACIT

The Delhi High Court has stayed the reassessment order based on an internal audit objection.

The division bench of Justice Rajiv Shadher and Justice Tara Vitasta Ganju has observed that the expression "any audit objection" was introduced only by the Finance Act, 2022, although with effect from April 1, 2012. Prior to the amendment, the expression obtained in Explanation 1(ii) appended to Section 148 referred to the "Comptroller and Auditor General of India."

Notification Under S. 5 of FTDR Act Can’t Be Applied Retrospectively To Refuse Advance Authorization To Importer: Delhi High Court

Case Title: Jindal Exports and Imports Pvt Ltd vs. Director General of Foreign Trade & Ors.

The Delhi High Court has ruled that a notification issued under Section 5 of the Foreign Trade (Development and Regulation) Act, 1992 (FTDR Act), which empowers the Central Government to formulate and announce the foreign trade policy, cannot be applied retrospectively by the Central Government.

Bombay High Court

No Reason For AO To Believe Income Chargeable To Tax Escaped Assessment: Bombay High Court

Case Title: Late Bharat Jayantilal Patel Versus Deputy Commissioner of Income Tax

The Bombay High Court has held that the development agreement permitted construction on the land only as a licensee, which did not have the effect of transmitting possession in favor of the licensee as per Section 53A of the Transfer of Property Act.

The division bench of Justice Dhiraj Singh Thakur and Justice Kamal Khata has observed that there was neither any tangible material nor any reason for the assessing officer to believe that "any income chargeable to tax had escaped assessment,". The action of the assessing officer, therefore, would be without jurisdiction.

Absence Of Material: Bombay High Court Quashes Reassessment Proceedings

Case Title: Konark Life Spaces Versus Assistant Commissioner of Income -Tax

The Bombay High Court has quashed the reassessment proceedings as the issue of "large loans and advances" was not only raised during the scrutiny assessment but also responded to by the assessee.

The division bench of Justice Dhiraj Singh Thakur and Justice Kamal Khata has observed that between the date of the order of assessment, which is sought to be reopened, and the date of the formation of the opinion, nothing new happened. There is neither new information on hand nor reference made to any new material on record.

CBDT Circular Disallowing Expenses Incurred On Granting Freebies To Doctors, Not Applicable To A/Y 2008-09: Bombay High Court

Case Title: Abbott India Ltd versus Assistant Commissioner of Income Tax & Ors.

The Bombay High Court has ruled that the CBDT Circular, dated 01.08.2012, as per which the expenses incurred in granting freebies to medical practitioners is inadmissible under Section 37 of the Income Tax Act, 1961, since it is prohibited by law, would not be applicable to the assessment year 2008-09.

Active PAN In Name Of Amalgamating Company, Would Not Justify Reassessment Proceedings Against It: Bombay High Court

Case Title: CLSA India Private Limited versus Deputy Commissioner of Income Tax & Ors.

The Bombay High Court has reiterated that once the revenue department is aware about the amalgamation and had knowledge regarding the non-existence of the amalgamating entity, an assessment order passed against such amalgamating entity would be void and not merely a procedural defect.

Madras High Court

State GST Authority Can’t Prosecute If The Central Authority Has Already Initiated Action: Madras High Court

Case Title: Tvl Metal Trade Incorporation Versus The Special Secretary

Citation: 2023 LiveLaw (Mad) 51

The Madras High Court has held that the State Authority cannot prosecute the petitioner once again as the Central Authority has already initiated action against the petitioner in respect of the very same subject matter.

Karnataka High Court

No GST Applicable On Supply Of Vouchers: Karnataka High Court

Case Title: M/s Premier Sales Promotion Pvt Ltd versus Union of India & Ors.

The Karnataka High Court has ruled that vouchers do not fall under the category of goods and services and therefore, the issue and supply of vouchers would not attract GST.

The bench of Justices P.S. Dinesh Kumar and T.G. Shivashankare Gowda remarked that vouchers, including Gift Vouchers and Cash Back Vouchers, are mere instruments accepted as consideration for supply of goods or services, which have no inherent value of their own.

Payroll Services By IBM Philippines Not FTS, TDS Not Liable To Be Deducted: Karnataka High Court

Case Title: Director of Income Tax Versus IBM India

Citation: 2023 LiveLaw (Kar) 65

The Karnataka High Court, while dismissing the appeal of the department, held that payroll services by IBM Philippines are not fees for technical services (FTS), and the TDS is not liable to be deducted.

The division bench of Justice P.S. Dinesh Kumar and Justice T.G. Shivashankare Gowda has observed that the work has been outsourced to IBM Philippines. IBM Philippines was carrying out the work described in the agreement between IBM India and P&G India. Hence, IBM Philippines was not rendering any technical service, and therefore, the income in the hands of IBM Philippines is a business income.

Calcutta High Court

GST Dept. Empowered To Detain Vehicle And Seize The Goods: Calcutta High Court Upholds Penalty

Case Title: Ashok and Sons (HUF) Vs. Joint Commissioner

The Calcutta High Court has held that the GST department was lawfully permitted to impose a penalty under Section 129 as well as the SGST as the goods were found to be detained in the territory of the state.

The bench of Justice Bibek Chaudhuri has observed that Section 129 of the Central Goods and Services Tax Act, 2017, empowers the statutory authority to detain the vehicle and seize the goods. The goods shall be released only upon payment of a penalty equal to 200% of the tax payable on the goods.

Classification Of Polypropylene Bags Can’t Be Changed Just To Avail Lower Tariff-Rate: Calcutta High Court Upholds AAAR’s Ruling

Case Title: Mega Flex Plastics Ltd. & Anr. Versus The Union of India

The Calcutta High Court, while upholding the ruling of the Orissa Appellate Authority, held that the classification of polypropylene bags cannot be changed just to avail a lower tariff rate.

The single Justice Md. Nizamuddin has observed that the polypropylene bags manufactured by the petitioner are made from plastic granules and cannot be treated as textile articles.

Allahabad High Court

Taxing Authorities Can't Stop Assessee From Claiming Statutory Right: Allahabad High Court

Case Title: M/S Yash Kothari Public Charitable Trust Versus State Of U.P. And 2 Others [WRIT TAX No. - 1027 of 2022]

Case Citation: 2023 LiveLaw (AB) 64

The Allahabad High Court has held that the taxing authorities cannot, in the garb of technicality, stop any assessee from claiming his statutory right, as provided under the Income Tax Act.

The bench of Justice Rohit Ranjan Agarwal has observed that, due to the mistake of the department or a technical glitch in the software, when an appeal of an assessee is not reflected on the portal, the department cannot deny the appeal filed offline on technical grounds.

Punjab & Haryana High Court

Penalty For Non Appearance - Not Valid If No Attempt To Evade Tax Is Made Out: Punjab & Haryana High Court

Case Title: M/s. Punjab Wool Syndicate Versus The State of Punjab and another

The Punjab and Haryana High Court has held that non-appearance before the Information Collection Centre (ICC) cannot be made a ground to initiate penalty proceedings if no attempt to evade tax is made.

The division bench of Justice Ritu Bahari and Justice Manisha Batra has observed that the driver had produced the documents at I.C.C. and subsequently, at the time of checking, he showed all the invoices. There was no attempt to evade tax. Hence, the VAT appeal was allowed, and no case for the imposition of a penalty is made out under Section 51(7)(c) of the Punjab VAT Act, 2005.

S. 124 of Finance Act, 2019 Not Violative of Article 14: Punjab & Haryana High Court

Case Title: M/s Schlumberger Asia Services Ltd versus Union of India & Anr.

The Punjab and Haryana High Court has upheld the constitutional validity of Sections 124(2) and 130(2) of the Finance Act, 2019, which deal with the ‘Vivad se Vishwas Scheme’ (VSV Scheme), dismissing the contention that the said provisions were violative of Article 14 of the Constitution of India since they deny refund to the assessee/ declarant even if the amount already deposited by it exceeds the amount payable under the Scheme.

Jharkhand High Court

Jharkhand High Court Allows Migration Of The TDS Amount Under GST

Case Title: M/s Subhash Singh Choudhary Versus The State of Jharkhand

The Jharkhand High Court has held that the unadjusted TDS amount has to be treated as an input tax credit amount and is required to be carried forward in the next succeeding months.

The division bench of Acting Chief Justice Aparesh Kumar Singh and Justice Deepak Roshan has observed that the unadjusted TDS amount would have been otherwise refundable to the petitioners if it were not allowed to be carried forward as excess input tax credit in the statutory format of a quarterly return (Form JVAT 200).

Orissa High Court

Invalid Assumption Of Jurisdiction: Orissa High Court Quashes Reassessment Notices Against Vedanta

Case Title: Vedanta Resources Ltd. Versus ACIT

The Orissa High Court has quashed the reassessment notice issued against Vedanta Resources Ltd. (VRL) on the grounds of an invalid assumption of jurisdiction.

The division bench of Chief Justice Dr. S. Muralidhar and Justice M.S. Raman observed that under Section 127(2)(a), no transfer of jurisdiction can take place without affording the Assessee a reasonable opportunity of being heard in the matter.

Mosquito Repellent ‘Good Knight’ Is An Insecticide, 4% VAT Applicable: Orissa High Court

Case Title: State of Odisha Versus M/s. Godrej Sara Lee Ltd.

The Orissa High Court has held that the mosquito repellent "Good Knight" sold by Godrej Sara Lee Ltd. is an insecticide.

Gauhati High Court

Gauhati High Court Directs CIT (TDS) To Refund Income Tax Deducted From Salary Of Scheduled Tribe Officer Expeditiously

Case Title: Chyawan Prakash Meena Versus UOI

The Gauhati High Court has directed the Commissioner of Income Tax (TDS) to expeditiously process the request for a refund of income tax deducted from the salary of the DIG (Ops) of the Border Security Force, who is a member of the scheduled tribe.

CESTAT

Service Tax Refund Can’t Be Denied On Input Services Wholly Consumed Within SEZ: CESTAT

Case Title: Vishay Semiconductor India Pvt. Ltd. Versus Commissioner of CGST & Central Excise

The Mumbai Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has held that service tax refunds cannot be denied on input services that are wholly consumed within the SEZ.

Haldiram Not Liable To Pay Service Tax On Take-Away Of Food Items: CESTAT

Case Title: Haldiram Marketing Pvt. Ltd. Versus Commissioner, Central Goods and Service Tax, GST Delhi East Commissionerate

The Delhi bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has held that no service tax can be levied on the activity of takeaway food items.

CESTAT Allows Cenvat Credit To Delhi Metro Rail Corporation On Consulting Engineer’s Services

Case Title: Delhi Metro Rail Corporation Ltd. versus Principal Commissioner, Service Tax, Delhi-I

The Delhi Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has granted Delhi Metro Rail Corporation a cenvat credit for consulting engineer services.

No Excise Duty Payable On Empty Barrels Used Only For Packing Material: CESTAT

Case Title: M/s Cairn India Limited Versus Assistant Commissioner

The Delhi Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has held that no excise duty is payable on empty barrels used only for packing material.