Supreme Court

'Anardana' Be Classified Under Heading 1209 Of Tariff Entries Under Customs Tariff Act, 1975 & Attract 5% Custom Duty Till Revenue Takes Policy Decision Regarding The Same: Supreme Court

Case Title: Commissioner of Customs And Central Excise, Amritsar (Punjab) v. M/s. D.L. Steels Etc. Civil Appeal Nos. 2360-2376 of 2009

The Supreme Court held that 'anardana' or dried pomegranate seeds would fall under Heading 1209 of the Tariff entries issued under the Customs Tariff Act, 1975, as classified by the Customs Excise and Service Tax Appellate Tribunal, attracting a custom duty at the rate of 5%, till the Revenue takes a considered policy decision regarding its classification.

The issue before the Bench comprising Justices Sanjiv Khanna and Bela M. Trivedi was that revenue authorities (appellant) asserted that 'anardana' falls under the Heading 0813 of the Tariff entries, and would incur custom duty at the rate of 30%, while the importers claimed that it is covered by Heading 1209 and attracts duty at the rate of 5%.

Supreme Court Allows 2-Months Extra Window For Availing Transitional Credit; Directs GSTN To Open Portal For TRAN-1/TRAN-2 Forms

Case Title : Union of India vs. M/s Filco Trade Centre Pvt. Ltd. and Anr.

Citation : 2022 LiveLaw (SC) 628

In a relief to several assessees who missed the statutory deadline, the Supreme Court has directed the Goods and Services Tax Network (GSTN) to allow a 2-month additional window from September 1, 2022 to October 31, 2022 for claiming Transitional Credit.

TRAN-1 and TRAN-forms were brought to allow assessees to carry forward pre-GST credits to the GST system. As per the GST Rules, such claims had to be filed within 90 days from the date when the GST Act came into force (July 1, 2017). Different High Courts passed directions for extending the timeline, against which the GST department approached the Supreme Court.

Delhi High Court

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.

Inapplicability Of MOOWR Scheme On Solar Power Generating Units:Delhi High Court Says No Coercive Action

Case Title: ACME Heergarh Powertech Private Limited vs. Central Board of Indirect Taxes and Customs and Anr.

The Delhi High Court bench of Justice Rajiv Shakdher and Justice Tara Vitasta Ganju issued notice and restrained the customs officer from taking any coercive action against the petitioners assailing the legality of Board Instruction No. 13/2022 dated 9.07.2022. The instruction was issued by the CBIC with regards to the inapplicability of the Manufacturing and Other Operations in Warehouse (no. 2) Regulations, 2019 (MOOWR Scheme) on solar power generating units.

Inapplicability Of MOOWR Scheme On Solar Power Generating Units:Delhi High Court Stays SCN Seeking To Revoke MOOWR License

Case Title: ACME Heergarh Powertech Private Limited vs. Central Board of Indirect Taxes and Customs and Anr.

The Delhi High Court bench of Justice Rajiv Shakdher and Justice Vitasta Ganju has stayed the show cause notice issued by the commissioner to revoke the licence under the Manufacturing and Other Operations in Warehouse (no. 2) Regulations, 2019 (MOOWR).

Bombay High Court

Mandatory Pre-Deposit U/S 129E of the Customs Act Is Constitutional: Bombay High Court

Case Title: United Projects Versus The State of Maharashtra

The Bombay High Court has ruled that by virtue of section 129E of the Customs Act, the right to appeal is a conditional right. The legislature, in its wisdom, has imposed a condition of deposit of a percentage of duty demanded or penalty levied or both.

The three-judge bench of Justice R.D. Dhanuka, Justice Nitin W. Sambre, and Justice Abhay Ahuja has observed that the fiscal legislation can very well stipulate as a requirement of law a mandatory pre-deposit as a condition precedent for an appeal to be entertained by the appellate authority. Thus, section 129E of the Customs Act cannot be held to be unconstitutional.

Roaming Services And International Long Distance Services Provided By Vodafone Idea To ForeignTelecom Operators Is An Export Of Service: Bombay High Court

Case Title: Vodafone Idea Limited versus UOI and Ors.

The Bombay High Court has ruled that the international Inbound Roaming Services (IIR) and the International Long Distance (ILD) Services provided by Vodafone Idea to Foreign Telecom Operators (FTOs) is an export of services, and thus, Vodafone Idea is eligible for the refund of the IGST paid by it.

The Bench, consisting of Justices K. R. Shriram and Milind N. Jadhav, observed that Vodafone Idea had entered into agreements with the FTOs and that there was no mention of any agreement with the subscribers of the FTOs. Hence, the Court ruled that the subscribers of the FTO cannot be considered as the recipient of the services and that the said services rendered by Vodafone Idea were supplied to the FTOs.

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 CoverValue 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.

Madras High Court Quashes Non-Speaking Order Rejecting The GSTRegistration Application

The Madras High Court bench of Justice Anitha Sumanth has quashed the non-speaking order rejecting the GST registration application.

The petitioner had made an application seeking registration in accordance with Section 22 read with Section 25 of the CGST Act and Rule 8 of the CGST Rules. The registration sought was in respect of a rice mandi. The receipt of the application was duly acknowledged and physical verification (pv) was also duly undertaken.

Dept. To Follow Procedure Set Out In Circular On The Issues Of Mismatch: Madras High Court Quashes VAT Assessment

Case Title: M/s.Gharpure Engg. & Construction (Pvt) Ltd. Versus Assistant Commissioner (ST)

Citation: 2022 LiveLaw (Mad) 324

The Madras High Court bench of Justice Anitha Sumnath has quashed the VAT assessment and directed the department to follow the procedure set out in the circular regarding the issue of mismatch.

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.

Karnataka High Court Quashes CBIC Circular Imposing GST OnAnnuity Payments Awarded By Highway Authorities To concessionaires

Case Title: M/s. D.P.J. Bidar-Chincholi (Annuity) Road Project Pvt Ltd.

The Karnataka High Court has quashed the circular issued by the Central Board of Indirect and Customs (CBIC) clarifying that GST is not exempt on the annuity (deferred payments) paid for the construction of roads and allowed the Writ Petition filed by the petitioner.

The single bench of Justice M.I. Arun observed that a circular which clarifies the notification cannot have the effect of overruling the notification.

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.

Andhra Pradesh High Court

GST Demand On Events Posted On Facebook: Andhra Pradesh HighCourt Directs Company To Approach Appellate Authority

Case Title: Vasavi Wedding And Event Planners Vs State of Andhra Pradesh

Citation : 2022 LiveLaw (AP) 95

The Andhra Pradesh High Court, while considering a petition challenging GST demand based on events posted on social media, held that information available on the social media platform of the petitioner shows that the event was conducted.

The division bench of Justice C. Praveen Kumar and Justice Tarlada Rajasekhar Rao dismissed the petition by giving liberty to the petitioner to approach the Appellate Authority.

Telangana High Court

Erroneous Recording of Place Of Supply As The Location Of Unregistered Recipient: Telangana High Court Remands The Matter

Case Title: M/s Ani Technologies Private Limited Versus State of Telangana

The Telangana High Court ruled that, while the department referred to Section12(9) of the IGST Act, the department erroneously recorded that, in the instance of an unregistered receiver, the place of supply should be the recipient's location. It prima facie appears to be in contravention of Section 12(9) of the IGST Act.

The division bench of Justice Ujjal Bhuyan and Justice Surepalli Nanda said, "it is prima facie evident that if the passenger is not registered under GST and avails transportation service, by way of legal fiction, the place of supply would be the place where the passenger embarks or starts his journey."

Telangana High Court Holds Telangana Value Added Tax (SecondAmendment) Act, 2017 To Be Unconstitutional

Case Title: M/s. Sri Sri Engineering Works and others Versus The Deputy Commissioner (CT), Begumpet Division, Hyderabad, and others

The Telangana High Court has held that the Telangana Value Added Tax (Second Amendment) Act, 2017 is unconstitutional.

The division bench of Chief Justice Ujjal Bhuyan and Justice P. Madhavi Devi has observed that the intention of Parliament in ushering in the GST regime through the Constitution Amendment Act, enactment of the CGST Act and simultaneous enactment of various State GST Acts by the State Legislatures was to avoid a multiplicity of taxes by subsuming those indirect taxes into a single tax called GST. However, the amendments brought in by the Second Amendment Act were wholly inconsistent with the scheme of the Constitution Amendment Act read with the CGST Act and the TGST Act.

Jharkhand High Court

Summary of Show Cause Notice In Form DRC-01 Is Not A Substitute Of Section 74(1) Show Cause Notice: Jharkhand High Court

Case Title: M/s. Juhi Industries Pvt. Ltd. Versus The State of Jharkhand

The Jharkhand High Court held that the summary of show cause notice in Form DRC-01 is not a substitute for show cause notice under Section 74(1) of the CGST Act.

The division bench of Justice Aparesh Kumar Singh and Justice Deepak Roshan has observed that though the petitioner submitted their concise reply, the respondent cannot take benefit of the action as a summary of show cause notice cannot be considered as a show cause notice as mandated under Section 74(1). It is well settled that there is no estoppel against statute, and a bonafide mistake or consent by the assessee cannot confer any jurisdiction upon the proper officer. The jurisdiction must flow from the statute itself. The rules of estoppel are the rules of equity, which have no role in matters of taxation.

Inspection Report Does Not Fulfil The Ingredients Of ProperShow-Cause Notice: Jharkhand High Court

Case Title: M/s Shyam Hardware Store Versus The State of Jharkhand

The Jharkhand High Court has held that the inspection report does not fulfil the ingredients of a proper show-cause notice; it amounts to a violation of principles of natural justice.

The division bench of Justice Aparesh Kumar Singh and Justice Deepak Roshan has observed that the adjudication order is null and void in the eye of the law if it is passed without the issuance of proper show-cause notice.

Himachal Pradesh High Court

Cash Sales Accepted By VAT Dept. Not Sufficient To Hold It To Be Genuine: Himachal Pradesh High Court

Case Title: PCIT Versus M/s J.M.J. Essential Oil Company

Citation: 2022 LiveLaw (HP) 18

The Himachal Pradesh High Court has held that the cash sales accepted by the VAT department are not sufficient to hold that the cash sales were genuine.

The division bench of Justice Sabina and Justice Satyen Vaidya has held that the Assessing Officer was liable to independently look into the cash sales to come to a conclusion as to whether the said sales were genuine or not. The Assessing Officer, as well as the Appellate Authority, rightly gave the finding of fact that the cash sales put forth by the respondent were not genuine and that the respondent had introduced its unaccounted income in the garb of cash sales.

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.

"Tobacco & Tobacco Products" In Schedule To Odisha Entry Tax Act Include 'Bidi': Orissa High Court

​​Case Title: M/s. Patel Brothers & Co., Sambalpur v. State of Odisha

The Orissa High Court has held that 'bidi' comes under the purview of "tobacco and tobacco products" as provided under Entry 16, Part I of the Schedule to the Odisha Entry Tax Act, 1999 ('OET Act'). A Division Bench of Chief Justice Dr. S. Muralidhar and Justice Radha Krishna Pattanaik observed, "Although learned counsel for the Petitioner sought to contend that under Entry 31 'cigarette and lighter' is a separate item and therefore unless there is a separate entry for 'bidi' it would not be amenable to entry tax in terms of the OET Act, the Court is unable to agree with the above contention. The expression 'tobacco and tobacco products' is wide enough to include 'bidi'..."

Rajasthan High Court

Rajasthan High Court GrantsBail 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 ITCrefund; 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 GrantsInterim 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.

Uttarakhand High Court

Cancellation Of GST Registration Affects Right To Livelihood,Writ Petition Is Maintainable: Uttarakhand High Court

Case Title: Vinod Kumar Versus Commissioner Uttarakhand State GST and others

The Uttarakhand High Court has held that the cancellation of GST registration affects the right to livelihood and the writ petition is maintainable.

The division bench headed by the Acting Chief Justice Sanjaya Kumar Mishra and Justice Ramesh Chandra Khulbe has observed that the appellant is denied his right to livelihood because of the cancellation of his GST Registration number. He has no remedy to appeal. It shall be violative of Article 21 of the Constitution as the right to livelihood springs from the right to life as enshrined in Article 21 of the Constitution of India.

Allahabad High Court

Show Cause Notice Cancelling GST Registration Must DiscloseReason: Allahabad High Court

Case Title: M/S Ram Krishna Garg Supplier Versus State Of U.P. And 4 Others WRIT TAX No. - 1064 of 2021

Citation: 2022 LiveLaw (AB) 329

The Allahabad High Court has held that the show cause notice cancelling registration must indicate the reason and the mere mentioning of violation under the CGST Act is not sufficient.

The single bench of Justice Saumitra Dayal Singh has observed that cancellation of registration has the most serious civil consequences. While Section 29(1) of the CGST Act provides for specific grounds for cancellation with effect from the date of the occurrence of certain events, Section 29(2) provides for harsher consequences, including cancellation of registration with a retrospective date. However, a registration may not be cancelled on the mere whims and fancies of the proper officer. It may be cancelled if the registered person contravenes any provision of the Act or Rule or if the person does not furnish returns for three tax periods consecutively or does not furnish returns for six months continuously. The registration can be cancelled if he does not commence business within six months of the grant of registration or he is found to have obtained registration by means of fraud, wilful misstatement, or suppression of facts.

CESTAT

Empty Packaging Material Of Cenvatable Input Is Not Liable ForPayment As Excise Duty Or As CENVAT Credit: Reiterates Ahmedabad CESTAT

Case Title: Cadila Healthcare Ltd. versus C.C.E. & S.T.-Vadodara-I

The Ahmedabad Bench of CESTAT has ruled that empty packaging material of cenvatable input is not liable for payment either as excise duty or as CENVAT credit under Rule 6(3) of the CENVAT Credit Rules, 2004.

The Single Bench of Judicial Member Ramesh Nair held that the assessee was not liable to pay any amount on the clearance of the said empty drums.

Extended Period Of Limitation Can Be Invoked Only When"Suppression Of Facts" Is Wilful To Evade Tax :CESTAT

Case Title: M/s T.S. Motors India Private Ltd. Versus Commissioner of CGST & Central Excise, Lucknow

The Allahabad Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has held that even when an assessee has suppressed facts, the extended period of limitation can be evoked only when "suppression" is shown to be wilful with intent to evade the payment of service tax.

The two-member bench headed by Justice Dilip Gupta (President) and Raju (Technical Member) has observed that the show cause notice merely mentions that the appellant suppressed the value of taxable service. The show cause notice does not mention that the suppression was with the intention of evading payment of service tax.

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.

Empty Packaging Material Of Cenvatable Input Is Not Liable ForPayment Of Excise Duty Or Cenvat Credit: CESTAT

Case Title: Candila Healthcare Ltd. Versus C.C.E. & S.T.-VADODARA-I

The Ahmedabad Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) consisting of Ramesh Nair (Judicial Member) has held that empty packaging material of cenvatable input is not liable for payment either as excise duty or as cenvat credit under Rule 6(3) of the Cenvat Credit Rules, 2004.

C&F Agent Service IsAdmissible Input Service Under Cenvat Credit Rules: CESTAT

Case Title: NITCO Limited Versus C.C.E. & S.T.-DAMAN

The Ahmedabad Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) consisting of Ramesh Nair (Judicial Member) has held that the C & F Agent Service is an admissible input service in the terms of Rule 2(l) of the Cenvat Credit Rules, 2004.

CESTAT Set Aside Demand Of Service Tax On Ocean Freight Charges

Case Title: M/s. Geodis Overseas Private Limited Versus The Commissioner of Service Tax

The Chennai Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) consisting of Sulekha Beevi C.S. (Judicial Member) and P. Anjani Kumar (Technical Member) has held that the ocean freight charges collected from customers are not subject to the levy of Service Tax under Business Support Services.

Services Provided With Respect To A Government Sports Stadium, Not A Commercial Service; Would Not Attract Service Tax: CESTAT Delhi

Case Title: M/s Shiv Naresh Sports Pvt. Ltd. versus Commissioner, Service Tax, Delhi

The CESTAT Delhi has ruled that an activity undertaken in a stadium, which belongs to the Government and which is used for non-commercial activities, would not be covered under the definition of 'Commercial or Industrial Construction' services, as defined in Section 65 (25b) of the Finance Act, 1994, and hence, it would not attract service tax.

The Bench, consisting of Justice Dilip Gupta (President) and Mr. Raju (Technical Member), held that the activity of laying Synthetic Athletic Track Surface is of a civil nature and therefore, it would fall within the definition of commercial or industrial construction services; however, since the same was provided in respect of a sport facilities owned by the Government, the same would not be chargeable to service tax.

CESTAT Allows Credit Of CVD And SAD Paid For Imports Made PriorTo The GST Regime

Case Title: M/s. ITCO Industries Ltd. versus The Commissioner of GST & Central Excise

The Chennai Bench of CESTAT has allowed credit of CVD and SAD paid after 30.06.2017 for the imports made prior to 30.06.2017, i.e., prior to the GST regime, under the advance authorisation scheme.

The Single Bench of Judicial Member Ms. Sulekha Beevi held that credit of CVD and SAD paid by the importer could not be denied on the ground that the duties were paid by the appellant only after an intimation letter was issued to it. The CESTAT observed that the said intimation letter had not been issued by invoking any provisions of the Customs law or Excise law.

CESTAT Allows Cenvat Credit On The Capital Goods

Case Title: M/s K K Spun India Ltd. Versus Commissioner of Central Excise Customs and Service Tax, Indore

The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), consisting of Anil Choudhary (Judicial Member), has allowed the cenvat credit on the capital goods, as their finished goods falling under CTH 68109990 are dutiable under the Central Excise Tariff Act.

Amount Lying After Wrong Invocation Of The Bank Guarantee: CESTAT Directs Payment of Interest

Case Title: M/s Leather Sellers Versus Commissioner of Customs And Excise, Patparganj

The Delhi Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has held that the amount was lying in the nature of the pre-deposit with the department from the date of encashment of the bank guarantee.

The bench of Anil Choudhary (Judicial Member) has observed that the appellant is entitled to 12% interest from the date of encashment of the bank guarantee under Section 129EE of the Customs Act.

Case Title: M/s Amba River Coke Ltd. Versus Principal Commissioner of Customs (Preventive)

Process Of Crushing And Screening Of Iron Ore Are Classified As Iron Ore Fines: CESTAT Allows BenefitOf Exemption From Payment Of CVD

The Mumbai Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has allowed the benefit of exemption from payment of countervailing duty (CVD) on the grounds that the process of crushing and screening of iron ore is classified as iron ore fines.

The two-member bench headed by Justice Dilip Gupta (President) and C.J. Mathew (Technical Member) has held that iron ore concentrate refers to an ore that has been subjected to special processes for removal of all or part of the foreign matter, i.e., gangue contained in the ore, with which it naturally occurs.

CESTAT Quashes Order Of Forfeiture Of Security Deposit,Sustained The Penalty On Customs Broker

Case Title: M/s Star CHA Management Services LLP Versus Commissioner of Customs, (Airport & General)

The Delhi Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has quashed the order of forfeiture of security deposit of Rs. 5 lakhs but sustained the penalty of Rs. 50,000 on the Customs Broker.

The two-member bench headed by Justice Dilip Gupta (President) and Raju (Technical Member) has observed that the forfeiture of security deposit of Rs. 5 lakhs and imposition of a penalty of Rs. 50,000 under Regulation 18 of CBLR, 2018 is excessive.

CESTAT Allows Cenvat Credit of 2% CVD Paid On Import Of SteamCoal

Case Title: Commissioner of Central Excise And Customs, Central Goods And Service Tax Versus M/s Shree Cement Ltd

The Delhi Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) consisting of Ajay Sharma (Judicial Member) and P.V. Subba Rao (Technical Member) has allowed the Cenvat credit of 2% CVD paid on the import of steam coal.

Seafarer's Recruitment Service Provider Is Not An intermediary:CESTAT Allows CENVAT Credit Refund

Case Title: M/s Anglo Eastern Maritime Services Pvt. Ltd. Versus Commissioner of CGST

The Mumbai bench of the Customs, Excise and Appellate Tribunal (CESTAT) consisting of Dr. Suvendu Kumar Pati (Judicial Member) has held that a seafarer's recruitment service provider, who processes the entire selection, medical test, insurance, transportation, training, etc. to the overseas client and receives convertible foreign exchange, is not an intermediary.

No Service Tax On Reimbursement Of Expenses From Customers OnAccount Of Water, Electricity And Diesel Expenses Incurred: CESTAT

Case Title: M/s. VITP Private Limited Versus Commissioner of Central Tax, Hyderabad-IV

The Hyderabad Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has held that the service tax is not applicable on reimbursement of expenses from its customers on account of water, electricity, and diesel expenses incurred for the provision of services.

The two-member bench of P.K. Chaudhary (Judicial Member) and P.V. Subba Rao (Technical Member) has observed that cenvat credit can be availed on work contract services and other services for the construction of immovable property. The Cenvat credit can be availed for event management services for the promotion of business.

AAR

E-Rickshaw Sold WithoutBattery 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 MunicipalitiesTowards 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.

Toll Charges Are IncludedIn The Value Of Outward Supply: Tamil Nadu AAR

Applicant's Name: NTL India Private Limited

The Tamil Nadu Authority of Advance Ruling (AAR) consisting of T.G.Venkatesh and K.Latha has ruled that the value of toll charges, being incidental expenses incurred while providing outward supply, is liable to be included in the value of outward supply of service.

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.

Renting Land For Fish/Prawn Farming Attracts 18% GST : AAR

Applicant's Name: Sri Vinayaka Hatcheries

The Andhra Pradesh Authority of Advance Ruling (AAR), consisting of D. Ramesh and RV Pradhamesh Bhanu, has ruled that 18% GST is payable on the rental of land for fish or prawn farming as the purpose of use of land was not mentioned in the lease agreement.

No GST Payable On Scanning And Processing Of Results Of Examinations: Andhra Pradesh AAR

Applicant's Name: Universal Print System

The Andhra Pradesh Authority of Advance Ruling (AAR) has ruled that GST is not payable on the scanning and processing of results of examinations.

The two-member bench of D. Ramesh and RV Pradhamesh Bhanu has observed that the printing of pre-examination items like question papers, OMR sheets (Optical Mark Reading), and answer booklets for the conducting of an examination by the educational boards be treated as an exempted supply of service.

GST Payable On Supply Of Medicines, Consumables Used For Providing Health Care Services To Out-Patientsadmitted To The Hospital: AAR

Applicant's Name: Be Well Hospitals

The Tamil Nadu Authority of Advance Ruling (AAR) has ruled that the supply of medicines and consumables used in the course of providing health care services to outpatients admitted to the hospital for diagnosis, medical treatment, or procedures is not a composite supply. As a result, it is subject to GST.

The two-member bench of T.G.Venkatesh and K.Latha has ruled that the supply of medicines and consumables used in the course of providing health care services to in-patients admitted to the hospital for diagnosis, medical treatment, or procedures till discharge is a composite supply. It amounts to composite supply only when the consolidated bill raised in the name of the patient indicates the supply of medicines and consumables during the course of the provision of health care services. Hence, it is exempted from GST.

Vessel Support Services Provided In Relation To Foreign Vessels Sailing To Other Countries Falls Under "Export of Services": AAR

Applicant's Name: NSK Ship Management Private Limited

The Tamil Nadu Authority of Advance Ruling (AAR) has ruled that the vessel support services provided in relation to foreign vessels sailing to other countries outside India fall under "export of services" as per Section 2(6) of the IGST Act, as the "place of supply" in such cases is entirely "outside India".

The two-member bench of T.G.Venkatesh and K.Latha has observed that if such vessels are calling at a port in India, then the Place of Supply in respect of that vessel is in India as per Section 13(6) of the IGST Act 2017 and the services rendered to that vessel are not an "export of service".

Sale Of Internet Advertising Space Except On Commission Is Exigible To 18% GST: AAR

Applicant's Name: Myntra Designs Private Limited

The Karnataka Authority of Advance Ruling (AAR) consisting of M.P.Ravi Prasad and T.KIran Reddy has ruled that the sale of internet advertising space (except on commission) is eligible for 18% GST.

AAAR

Activity Of Providing Free Complimentary Cricket Match Tickets Is Exempted From GST: AAAR

Appellant's Name: KPH Dream Cricket Private Limited

The Punjab Appellate Authority of Advance Ruling (AAAR)has ruled that the GST is payable on the activity of providing free complimentary cricket match tickets. However, where complimentary tickets are being provided by the appellant to a related person or a distinct person, it shall fall within the ambit of supply on account of Schedule I and the appellant would be liable to pay tax.

The bench of Aruna Narayan Gupta and Kamal Kishor Yadav has observed that the appellant would not be eligible to avail input tax credit in relation to the activity of providing free complimentary cricket match tickets. However, if an activity or transaction is treated as a supply because it is provided by the appellant to a related or distinct person, the appellant is entitled to the input tax credit.

Supply Of Food And Drinks In Trains Or At Platforms Attracts 5%GST: AAAR

Applicant's Name: Deepak & Co.

The Delhi Appellate Authority of Advance Ruling (AAAR) has ruled that the GST rate on the supply of food and drinks, whether in trains or at platforms (static units), will attract 5% GST without an Input Tax Credit (ITC).

The two-member bench of Mallika Arya and Ankur Garg ruled that the supply of newspapers to passengers is exempt from GST.

Direct Tax

Supreme Court

Sufficiency Or Inadequacy Of Reasons To Believe Cannot Be LookedInto While Considering Validity Of Search & Seizure U/Sec 132 Income Tax Act: Supreme Court

Case Title: Principal Director Of Income Tax (Investigation) vs Laljibhai KanjiBhai Mandalia | 2022 LiveLaw (SC) 592

Citation: 2022 LiveLaw (SC) 592

The Supreme Court, in a judgment delivered on Wednesday, restated the principles in exercising the writ jurisdiction in the matter of search and seizure under Section 132 of the Income Tax Act.

"The sufficiency or inadequacy of the reasons to believe recorded cannot be gone into while considering the validity of an act of authorization to conduct search and seizure", the bench comprising Justices Hemant Gupta and V. Ramasubramanian observed.

Delhi High Court

Failure To File Income Tax Return | Prosecution U/S 276CC IT Act Not Permissible Without Previous SanctionOf Appropriate Authority: Delhi High Court

Case Title: Vipul Aggarwal versus Income Tax Office

The Delhi High Court has made it clear that a person cannot be prosecuted for the offence under Section 276-CC (Failure to furnish returns of income) of the Income Tax Act, except with the previous sanction of the Principal Commissioner/appropriate authority.

A single judge bench of Justice Asha Menon held, "Since the law provides that without sanction u/s 278B of the IT Act, the Department cannot proceed against a person found liable to prosecute him for the offence under Section 276 CC of the IT Act, the present prosecution must fail qua the petitioner. In the absence of a specific sanction for prosecuting the petitioner, the learned ACMM could not have taken cognizance of the complaint against him and then framed charges against him. The edifice built without foundation must crumble."

Explanation To Section 14A Of Income Tax Act Will Not Apply Retrospectively: Delhi High Court

The Delhi High Court has ruled that the Explanation to Section 14A of the Income Tax Act, 1961, added vide the Finance Act, 2022, cannot be presumed to be retrospective in nature since it is clarificatory in nature and alters the law as it stood earlier.

The Division Bench of Justices Manmohan and Manmeet Pritam Singh Arora held that in view of the law laid down by the Supreme Court in Sedco Forex International Drill. Inc. versus CIT (2005), the amendment to Section 14A, which is "for removal of doubts", cannot be presumed to be retrospective, even if such a language is used, since it alters and changes the law as it prevailed before.

No Section 40(a)(ia) Disallowance In Case Of Short Deduction Of TDS: Delhi High Court

Case Title: Pr. Commissioner of Income Tax-I Versus Future First Info. Services Pvt. Ltd.

Citation: 2022 LiveLaw (Del) 696

The Delhi High Court has held that no disallowance under Section 40 (a)(ia) of the Income Tax Act is called for in the case of a short deduction of TDS and the correct course of action would have been to invoke Section 201 of the Income Tax Act.

The division bench of Justice Manmohan and Justice Manmeet Pritam Singh Arora has observed that disallowance under section 40A(2)(b) has to be based on cogent material or reasoning by the Assessing Officer.

Tax payment Software Has To Be Tailor-Made According To The Legal Rights Of The Taxpayers: Delhi High Court

Case Title: Celerity Infrastructure Pvt. Ltd. Versus Dy Commissioner Of Income Tax Circle 73-1

Citation: 2022 LiveLaw (Del) 706

The Delhi High Court has held that the tax payment software has to be tailor-made according to the needs, aspirations, and legal rights of the taxpayers and not that the taxpayers' legal rights have to be tailor-made in accordance with the software being used by the Tax Department.

The division bench of Justice Manmohan and Justice Manmeet Pritam Singh Arora has held that as the petitioners have paid the taxes, they should be given credit for the challans paid on Form 3 under the Direct Tax Vivad se Vishwas Act (DTVSV Act). The order/communication rejecting credit of taxes deposited under the DTVSV on the hyper-technical ground that challans have been deposited under the minor head '200' instead of '400' is unfair, illegal, and contrary to the objective of enacting the DTVSV Act.

Delhi High Court Directs DSIR To Issue Report Quantifying Expenditure On Scientific Research Incurred ByThe Assessee

Case Title: SRF Ltd. versus Union of India

Citation: Citation: 2022 LiveLaw (Del) 714

The Delhi High Court has directed the Department of Scientific and Industrial Research (DSIR) to issue reports on the expenditure incurred by the assessee SRF Ltd. for the relevant assessment years in Form 3CL within six weeks.

The Division Bench of Justices Manmohan and Manmeet Pritam Singh Arora observed that the DSIR is statutorily bound to issue the Form 3CL within 120 days in accordance with Rule 6(7A) (ba) of the Income Tax Rules, 1962, certifying the expenditure incurred by the assessee on its in-house R&D units.

Bombay High Court

AO To Workout Pro Rata Deduction In Regard To Eligible Residential Units: Bombay High Court

Case Title: The Pr. Commissioner of Income Tax- 4 Versus Kumar Builders Consortium

Citation : 2022 LiveLaw (Bom) 265

The Bombay High Court has upheld the order of the ITAT directing the Assessing Officer to work out the pro rata deduction under Section 80IB(10) of the Income Tax Act, 1961.

The division bench of Justice Dhiraj Singh Thakur and Justice Abhay Ahuja has observed that Section 80IB(10) nowhere even remotely aims to deny the benefit of deduction in regard to a residential unit, which otherwise confirms the requirement of size at the cost of an ineligible residential unit with a built-up area of more than 1500 sq. ft.

Karnataka High Court

Karnataka High Court Quashes CBIC Circular Imposing GST On Annuity Payments Awarded By Highway Authorities To concessionaires

Case Title: M/s. D.P.J. Bidar-Chincholi (Annuity) Road Project Pvt Ltd.

The Karnataka High Court has quashed the circular issued by the Central Board of Indirect and Customs (CBIC) clarifying that GST is not exempt on the annuity (deferred payments) paid for the construction of roads and allowed the Writ Petition filed by the petitioner.

The single bench of Justice M.I. Arun observed that a circular which clarifies the notification cannot have the effect of overruling the notification.

Karnataka High Court Directs Income Tax Department To Issue A 'Nil Tax Deduction At Source'Certificate To Flipkart For Reimbursements Made To Walmart

Case Title: M/S. Flipkart Internet Private Limited versus Deputy Commissioner Of Income Tax (International Taxation) and Ors.

The Karnataka High Courthas directed the Income Tax Department to issue a 'Nil Tax Deduction at Source' Certificate to Flipkart under Section 195(2) of the Income Tax Act, 1961, with respect to the reimbursements made by it to Walmart Inc.

Madras High Court

IBC Proceedings Can't Dilute Rights Of The Income Tax Department To Reopen Assessment: Madras High Court

Case Title: M/s. Dishnet Wireless Limited versus the Assistant Commissioner of Income Tax (OSD)

Citation: 2022 LiveLaw (Mad) 278

The Madras High Court has ruled that proceedings under the Insolvency and Bankruptcy Code (IBC), 2016 cannot dilute the rights of the Income Tax Department to reopen the assessment under Section 148 of the Income Tax Act, 1961. The Court noted that the Resolution Plan submitted by the assessee did not contemplate any concession from the Income Tax Department, even though notice under Section 148 of the Income Tax Act was issued to the assessee prior to the submission of the Resolution Plan.

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.

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.

Calcutta High Court

Income Tax Dept. Can't Unreasonably Reject Proof Submitted ByThe Assessee: Calcutta High Court

Case Title: PCIT Versus Sreeleathers

The Calcutta High Court has held that the income tax department cannot unreasonably reject proof submitted by the assessee.

The division bench of Justice T.S. Sivagnanam and Justice Bivas Pattanayak noted that the assessing officer brushed aside the explanation offered by the assessee by stating that merely filing PAN details and a balance sheet does not absolve the assessee from his responsibilities of proving the nature of transactions.

Right To File Statutory Appeal Is Mandatory Before Initiating Any Recovery Proceeding: Calcutta High Court

Case Title: Purulia Metal Casting Pvt. Ltd. Versus Assistant Commissioner of State Tax, Purulia Charge & Ors.

The Calcutta High Court bench of Justice Md. Nizamuddin has held that the right to file a statutory appeal is mandatory before initiating any recovery proceeding.

Reopening Assessment Without Furnishing Information Violates Principles Of Natural Justice: Calcutta High Court

Case Title: Maharaja Edifice Pvt. Ltd. Vs. Union of India & Ors.

The Calcutta High Court bench of Justice T.S. Shivagnanam and Justice Bivas Pattanayak has held that failure to furnish information based on which assessment was reopened is a violation of principles of natural justice.

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.

Fee Paid For Client Referral Services Is A Normal Business Payment And Not FTS: ITAT Delhi

The Delhi Bench of ITAT has ruled that fees paid by the assesssee to a non-resident for providing services of introduction of clients would fall in the definition of payments made to an intermediary and the same cannot be said to be a technical service.

The Bench, consisting of Anubhav Sharma (Judicial Member) and Shamim Yahya (Accountant Member), held that the remittances made by the assessee to its intermediary for providing client referral services would not come within the scope of 'fees for technical services' (FTS) under Section 9(1)(vii) of the Income Tax Act, 1961 and that the same was a normal business payment.

Cash Deposits Related To 'Shroff Business' Is Not An Undisclosed Income: ITAT

Case Title: The DCIT Versus M/s. Sidhanath Enterprise

The Rajkot Income Tax Appellate Tribunal (ITAT), consisting of TR Senthil Kumar (Judicial Member) and Annapurna Gupta (Accountant Member), has ruled that the cash deposits related to the Shroff business are not an undisclosed income.

Expenditure Incurred OnTrademark Registration Is A Revenue Expenditure: ITAT Allows Deduction

Case Title: Add. CIT Versus M/s Precision Bearing Pvt. Ltd.

The Ahmedabad Bench of the Income Tax Appellate Tribunal (ITAT)has allowed the deduction and held that the expenditure incurred on trademark registration is a revenue expenditure.

The two-member bench of Suchitra Kamble (Judicial Member) and B.M. Biyani (Accountant Member) has ruled that the amendment in section 32 of the Income Tax Act from A.Y. 1999-2000 which allows deprecation on various intangible assets (including trademarks) is applicable only when the cost incurred in respect of a trademark is in the nature of capital expenditure.

SFIS Credit Does Not Constitute Taxable Income: ITAT Delhi

Case Title: Container Corporation of India Ltd. versus DCIT

The Delhi Bench of ITAT has ruled that the credit received by the assessee under the "Served From India Scheme" (SFIS) is not in the nature of income and that it does not constitute taxable income under Section 2(24) (xviii) of the Income Tax Act, 1961.

The Bench, consisting of Yogesh Kumar US (Judicial Member) and Dr. B.R.R. Kumar (Accountant Member), observed that the SFIS credit had only reduced the value of a capital asset in the books of accounts of the assessee by the amount of excise duty and that if the SFIS credit was not available, the assessee would have paid the excise duty and added the same to the cost of the asset. Hence, the ITAT ruled that there was no element of revenue or income in the SFIS credit.

ITAT Directs Revenue To Give Effect To High Court Order Holding Software License Charges Received By EY Not Taxable As 'Royalty'

Case Title: EY Global Services Ltd. versus ACIT

The Delhi Bench of ITAT has directed the revenue authorities to give effect to the order passed by the Delhi High Court in favour of EY Global Services Limited (UK) (EYGSL (UK), holding that payments received by EYGSL (UK) from its member firms in India, towards Software License and Maintenance Charges, Global Technology Charges and GWAN Connectivity Charges, are not taxable in India.

The Bench, consisting of Astha Chandra (Judicial Member) and Shamim Yahya (Accountant Member), noted that the Delhi High Court, reversing the order passed by the AAR, has held that the payment received by EYGSL (UK) for providing access to computer software to its EY member firms located in India did not amount to 'Royalty' and hence, it was not taxable in India under the provisions of the Income Tax Act, 1961 and the India-UK DTAA.

Benefit Of Carried Forward Business Losses And Unabsorbed Depreciation Losses Can't Be Availed For Ingenuine Amalgamation/Demerger: ITAT

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

The Pune Bench of the Income Tax Appellate Tribunal (ITAT) consisting of S.S. Vishwanethra Ravi (Judicial Member) and Inturi Rama Rao (Accountant Member) has held that the benefit of section 72A of the Companies Act, 1956 cannot be availed if the sole idea of the amalgamation was only to avail the benefit of carried forward business losses and unabsorbed depreciation losses as it is not for genuine purpose.

Usage Of Telephone/InternetIs Done For Official Purposes : ITAT Deletes Disallowance

Case Title: M/s. Bigfoot Retail Solution Pvt. Ltd. Versus ACIT

The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) has deleted the disallowance on the grounds that the usage of telephone/internet is done for official purposes only.

The two-member bench of Astha Chandra (Judicial Member) and Anil Chaturvedi (Accountant Member) held that all telephones are either installed at office premises or used by officers and employees of the assessee company and usage of telephones and internet is done by employees for official purposes only. The expenses were incurred in the course of business of the assessee company and were not in the nature of personal expenditure.

SBI Cannot Escape Tax Implication On Grounds Of Change Of Branch Manager: ITAT Refuses To Condone The Delay In Filing Appeal

Case Title: State Bank of India versus The Income Tax Officer

The Bangalore Bench of the Income Tax Appellate Tribunal (ITAT)has refused to condone the delay in filing the appeal on the grounds that even during the period of COVID-19, the ITAT was functioning and banking facilities were provided by the State Bank of India (SBI).

The two-member bench of George George K. (Judicial Member) and Laxmi Prasad Sahu (Accountant Member) has observed that the assessee must be well aware of the tax implications. It is the duty of the responsible officer to comply with the notices. The bank's books of accounts are audited by the CA along with the internal auditors. The assessee cannot escape by giving the reason merely as a change of branch manager.

Completed Assessments Can Be Interfered With Only On The Basis Of Incriminating Material Unearthed During Course Of Search: ITAT

Case Title: AGM Properties P. Ltd. Versus ACIT

The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) has held that completed assessments could be interfered with by the AO while making an assessment under section 153A only on the basis of some incriminating material unearthed during the course of search. If in relation to any assessment year, no incriminating material was found, no addition or disallowance could be made in relation to that assessment year in the exercise of powers under section 153A of the Income Tax Act.

The two-member bench of Astha Chandra (Judicial Member) and Anil Chaturvedi (Accountant Member) has observed that the assessment for AY 2013-14 was already completed prior to the date of search. The scope of proceedings under section 153A had to be confined only to material found in the course of the search.

No Capital Gain Exemption On The Agriculture Land Purchased In The Name Of Assessee's Wife: ITAT

Case Title: Karamvir Versus Income Tax Officer, Ward-2(2)

The Delhi Bench of the Income Tax Appellate Tribunal (ITAT)consisting of Saktijit Dey (Judicial Member) and B.R.R. Kumar (Accountant Member) has held that the agricultural land purchased by the assessee in the name of his wife is not eligible for deduction under section 54B of the Income Tax Act.

Cash Deposit Of Firm Can't Be Added To Personal Income Of Partner Without Investigation: ITAT

Case Title: Srijal Gupta Versus Income Tax Officer of Income Tax Ward 6(3)

The Amritsar Bench of the Income Tax Appellate Tribunal (ITAT), consisting of Anikesh Banerjee (Judicial Member) and Dr. M. L. Meena (Accountant Member), has held that the cash deposit of a firm can not be added to the personal income of the partner without investigation.

The notice under section 148 of Income Tax Act was issued against the assessee on 15.03.2013. The assessee filed his return of income declaring the NIL income as there was no income and the assessee only purchased a property. The reasons were recorded by the AO.

Inland Haulage Charges Received By Shipping Companies NotTaxable As Business Profit: ITAT Mumbai

Case Title: Avana Global FZCO versus Deputy Commissioner of Income Tax

The Mumbai Bench of ITAT has reiterated that the activity of Inland Haulage is directly connected with the transportation of goods in international traffic and thus, Inland Haulage Charges are not taxable as business profit in India in view of Article 8 of the India-UAE DTAA (Double Taxation Avoidance Agreement).

The Bench, consisting of Vikas Awasthy (Judicial Member) and Gagan Goyal (Accountant Member), held that since the activity of Inland Haulage was directly connected with the transportation of goods in international traffic, and since it was an integral part of operation of ships; hence, the Inland Haulage Charges cannot be disintegrated from profits derived from shipping business, as envisaged under Article 8 of the DTAA.

ITAT Holds Revisionary Order Passed Without Mentioning DIN As Invalid

Case Title: Tata Medical Centre Trust versus Commissioner of Income Tax, (Exemption)

The Kolkata Bench of the ITAT has quashed the revisionary order passed by the Income Tax Authority without quoting the Document Identification No. (DIN) in the said order, as required by the CBDT Circular No.19/2019, dated 14.08.2019.

The Bench, consisting of Mr. Sanjay Garg (Judicial Member) and Mr. Girish Agrawal (Accountant Member), held that since the order passed by the Income Tax Authority failed to mention the DIN in its body, therefore, the said order was "invalid and deemed to have never been issued", as provided under the said CBDT Circular.

Loan Given To Shareholder For Consideration Beneficial To TheCompany Is Not A Deemed Dividend: ITAT

Case Title: Archana Sharma Versus DCIT

The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) has held that if a loan or advance is given to a shareholder as a consequence of any consideration which is beneficial to the company, in such a case, the advance or loan cannot be said to be a deemed dividend.

The two-member bench of Astha Chandra (Judicial Member) and Anil Chaturvedi (Accountant Member) has observed that a gratuitous loan or advance given by a company to the classes of shareholders would come within the purview of a deemed dividend under section 2(22) of the Income Tax Act.

TPO Not Justified In Treating The Value Of International Transaction Of "Payment of Corporate IT Support Services" To Be Nil:ITAT

Case Title: M/s. Sulzer Tech India Pvt. Ltd. Versus Addl./Jt./Dy./Asstt. Commissioner Of Income Tax

The Mumbai Bench of the Income Tax Appellate Tribunal (ITAT) has observed that the TPO was not justified in treating the value of international transactions "Payment of Corporate IT Support Services" as NIL.

The two-member bench headed by Pramod Kumar (Vice President) and Sandeep Singh Karhail (Judicial Member) has observed that no search was conducted to find out the independent entity in a comparable transaction and the arm's length price of the international transaction was treated to be Nil.

ITAT Quashes Order Holding Air India An Assesssee In Default For Shortfall In Deduction Of TDS On Payments Made To Its Subsidiary

Case Title: Air India Ltd. versus Commissioner of Income-tax (Appeals), NFAC, Delhi

The Mumbai Bench of ITAT has ruled that Air India must be given the benefit of the Proviso to Section 201 (1) of the Income Tax Act, 1961 and hence, it cannot be considered as an assessee in default for shortfall in deduction of TDS on the payments made by it to its subsidiary - Air India Engineering Services Ltd.

The Bench, consisting of Kavitha Rajagopal (Judicial Member) and Baskaran B.R. (Accountant Member), remitted the matter back to the Assessing Officer for examining the claim of Air India for availing the benefit of the Proviso to Section 201 (1), as per which an assessee shall not be treated as an assessee in default, if the conditions specified therein are complied with.

Capital Gain Exemption Can Be Availed Only When The New Asset Is Purchased In The Name Of The Assessee: ITAT

Case Title: Dilip B. Mundada Versus The Dy.CIT

The Pune Bench of the Income Tax Appellate Tribunal (ITAT) has held that for availing the benefit of deduction under section 54F, the new asset shall be purchased in the name of the assessee.

The two-member bench of S.S.Godara (Judicial Member) and Dipak P. Ripote (Accountant Member) has observed that section 54F does not say that the assessee shall invest in the new house, but it says the assessee shall purchase a new house. The assessee claimed that the amount for the flat was invested by him. However, it was factually incorrect. As per the documents, the payments for the flat were made by his wife.