Supreme Court Sets Aside Bail Condition To Deposit Rs 70 Lakhs In Case For Wrongfully Claiming ITC

Case Title: Subhash Chauhan Versus UOI

Citation: 2023 LiveLaw (SC) 61

The Supreme Court has overturned a bail condition imposed by the High Court that a person accused of illegally claiming Input Tax Credit must deposit Rs. 70 lakhs, the alleged amount of improperly claimed ITC.

Income Tax Act - For Block Assessment, Normals Procedure Not Applicable; Interest Can Be Levied Without Sec 158BC Notice : Supreme Court

Case Title: K.L. Swamy v. Commissioner of Income Tax And Anr.

2023 LiveLaw (SC) 54

The Supreme Court recently held that revenue was justified in levying interest under Section 158BFA(1) of the Income Tax Act for late filing of the return for the block period even in absence of any notice under Section 158BC of the Act and for the period prior to 01.06.1999.

A Bench comprising Justice M.R. Shah and Justice C.T. Ravikumar was considering a batch of petitions dealing with the same issue.

'Premature For High Court To Opine On Tax Evasion' : Supreme Court Sets Aside HC Order Which Quashed Notice Under Section 130 CGST Act

Case Title: State of Punjab Versus Shiv Enterprises Civil Appeal No. 359 of 2023

Citation : 2023 LiveLaw (SC) 56

Observing that it was "premature" on the part of the High Court to quash a show-cause notice issued under Section 130 of the Central Goods and Service Tax Act by invoking Article 226 jurisdiction, the Supreme Court recently set aside an order passed by the Punjab and Haryana High Court.

The Supreme Court noted that there were allegations about evasion of tax and hence it was premature on the part of the High Court to opine anything on whether there was any evasion of the tax or not. The same was to be considered in an appropriate proceeding for which the notice under Section 130 of the Act was issued.

Delhi High Court

Payment Of Tax And Penalty To Release Detained Goods Can’t Be Treated As “Admission” On The Part Of Assessee: Delhi High Court

Case Title: Ram Prakash Chauhan Versus Commissioner of Delhi (GST)

Citation: 2023 LiveLaw (Del) 78

The Delhi High Court has held that the payment of tax and penalty to release the detained goods shall not be treated as "admission" on the part of the assessee.

The division bench of Justice Vibhu Bakhru and Justice Amit Mahajan has observed that the petitioner had paid the tax and penalty for the release of the goods and that the said payment was not voluntary. Neither the show-cause notice nor the order of demand clearly sets out the reason for imposing the tax liability as well as the penalty.

CAAR Not Barred From Giving Ruling On The Ground Of Preliminary Exercise Being Done By Customs Officer: Delhi High Court

Case Title: Directorate of Revenue Intelligence (Hqrs.) versus M/s Spraytec India Ltd

Citation: 2023 LiveLaw (Del) 82

The Delhi High Court has ruled that merely because an officer of customs contemplates that a question may arise for consideration, does not mean that the question is “pending” consideration so as to bar the Customs Authority for Advance Ruling (CAAR) from deciding the issue in an application for advance ruling, under Clause (a) of the proviso to Section 28-I (2) of the Customs Act, 1962.

No Provision In GST Act for Confiscating Currency From The Premises : Delhi High Court

Case Title: Arvind Goyal CA Versus UOI

Citation: 2023 LiveLaw (Del) 83

The Delhi High Court ruled that there is no provision in the GST Act that would allow for the forcible removal of currency from the premises of any person.

The division bench of Justice Vibhu Bakhru and Justice Amit Mahajan has observed that the powers of search and seizure are draconian powers and must be exercised strictly in terms of the statute and only if the necessary conditions are satisfied.

Bombay High Court

Reassessment Notice after 4 Years should have the Sanction Of PCIT: Bombay High Court

Case Title: MA Multi-Infra Development Pvt. Ltd. Versus ACIT

The Bombay High Court ruled that issuing a reassessment notice after four years is subject to the approval of the Principal Chief Commissioner of Income-tax (PCIT).

The division bench of Justice Dhiraj Singh Thakur and Justice Kamal Khata has ruled that the approval for the issuance of a notice under Section 148 ought not to have been obtained from the Additional Commissioner of Income Tax but from the authority specifically mentioned under Section 151(ii) of the Income Tax Act.

Failure To Adjust Interest Paid By NCPA Is Hyper-Technical, Should Not Affect Sabka Vishwas Scheme: Bombay High Court

Case Title: National Centre for the Performing Arts Versus Union of India

The Bombay High Court has held that failure to adjust interest paid by the National Centre for the Performing Arts (NCPA) was hyper- technical and should not come in the way of implementation of Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 ( SVLDRS).

The division bench of Justice Nitin Jamdar and Justice Abhay Ahuja has observed that the object of the SVLDR Scheme should not be lost sight of, as the scheme has itself been formulated for the smooth settlement of disputes. The interpretation of the provisions should be to carry forward the object rather than to frustrate the it by giving rise to more litigation.

Madras High Court

Can the Writ Court Condone Delay Beyond Time Limit Under GST Act: Madras High Court Refers Issue To DB

Citation: 2023 LiveLaw (Mad) 27

The Madras High Court has referred to the division bench the issue of the power of the high court under Article 226 to condone the delay beyond the maximum time limit stipulated under the GST Act.

The single bench of Justice Abdul Quddhose has observed that there were two contradictory views expressed by two judges of the Madras High Court.

Kerala High Court

Presence Of Gold In Pocket Without The Appropriate Documentation Raises Suspicions Of Tax Evasion: Kerala High Court

Case Title: Sasi Pathirakunnath Versus Assistant State Tax Officer

Citation: 2023 LiveLaw(Ker) 21

The Kerala High Court has held that the presence of gold in your pocket without the appropriate documentation raises suspicions of tax evasion.

The bench of Justice Gopinath P. has observed that there is no satisfactory explanation for the fact that there was a discrepancy in the number of documents produced by the petitioner in the evening before the department and the quantity of gold actually recovered from the petitioner.

Allahabad High Court

Allahabad High Court Stays Rs.1,081 Crores GST Demand Against Paytm

Case Title: One 97 Communications Limited Versus UOI

The Allahabad High Court has stayed the Goods and Service Tax (GST) demand of Rs. 1,081 crores against Paytm.

"The amount of tax due on the transaction has already been paid, and the only dispute is whether it is to be treated as an intra-state sale or an inter-state sale; recovery of the demand raised shall remain stayed till the next date of hearing," the division bench headed by Chief Justice Rajesh Bindal and Justice J.J. Munir said while listing the matter for hearing on April 27, 2022.

Rajasthan High Court

Online Gaming Not Betting/Gambling; Rajasthan High Court Grants Interim Relief to Myteam 11

Case Title: Myteam11 Fantasy Sports Private Limited versus Union of India

The Rajasthan High Court has observed that the issue regarding the nature of gaming services provided online is no longer res-integra, adding that such gaming services have been held to be games of skill and not games in nature of betting or gambling.

Gujarat High Court

Gujarat High Court Quashes Reassessment Order Citing Inability Of Assessee To Secure Relevant Documents Amid Covid-19 Lockdown

Case Title: Kavita Krushna Kumar v. Union of India

The Gujarat High Court recently quashed a reassessment order and final notice of assessment issued against to an assessee after she failed to produce the relevant documents, particularly Form-F prescribed under Gujarat Value Added Tax Act, 2003 amid Covid-19 lockdown.

The division bench of Justice Sonia Gokani and Justice Sandeep N. Bhatt allowed the petition under Article 226 of the Constitution on the ground that not giving proper opportunity to the petitioner as per the law is a clear violation of principle of natural justice.

AAAR

Administering Of COVID-19 Vaccine By Hospitals Attracts 5% GST: AAAR

The Andhra Pradesh Appellate Authority for Advance Ruling (AAAR) has ruled that hospitals must pay 5% GST when administering the COVID-19 vaccine.

The two-member bench of Sanjay Pant and M. Girija Shankar has observed that the administration of the COVID-19 vaccine is not an exempt supply as it is not covered under the definition of "healthcare services." Further held, it is a composite supply wherein the principal supply is the "sale of vaccines" and the ancillary supply is the "service of administering vaccines."

AAR

18% GST Payable On The Forest Permit Fee: Telangana AAR

Applicant: M/s Singareni Colleries Company Ltd.

The Telangana Authority for Advance Ruling (AAR) has held that 18% GST is payable on the forest permit fee.

The two-member bench of B.P. Naga Siva Kumari observed that the permit fees collected by the forest department are used by forest officials to monitor mining activity, assess the quantity and type of mineral being quarried, conduct surveys, and keep a constant eye on the movement of the produce, and are unrelated to social or farm forestry.

GST Not Payable On Reimbursement Of Tree Cut Compensation Paid To Farmers By Pure Agent: Karnataka AAR

Applicant’s Name: Sree Subha Sales

The Karnataka Authority for Advance Ruling (AAR) has ruled that a pure agent is not liable to pay GST on reimbursement of compensation amounts paid to farmers and landowners.

The two-judge bench of M.P. Ravi Prasad and Kiran Reddy T. has ruled that reimbursement of land compensation amounts paid to farmers and landowners during the course of work is subject to GST if the applicant does not qualify as a pure agent.

CESTAT

Promotional Activities Undertaken By Cricketers Are Not Covered Under Business Support Service: CESTAT Quashes Service Tax Demand Against Irfan Pathan and Yusuf Pathan

Case Title: Yusufkhan M Pathan Versus C.C.E. & S.T.-Vadodara-ii

The Ahmedabad Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has quashed the service tax demand against the international cricketers, Irfan Pathan and Yusuf Pathan.

The two-member bench of Ramesh Nair (judicial member) and Raju (technical member) has observed that the apparel that the appellant had to wear was team clothing, which bears the brand names and marks of various sponsors. The appellants were not providing any service as independent individuals. It cannot be said that the appellants were rendering any services that could be classified as business support services.

Payments Made Through Cenvat Account Is Liable To Be Re-Credited If Excise Duty Is Paid In Cash: CESTAT

Case Title: M/s Mideast Integrated Steels Ltd. Versus Commissioner of CGST & Excise

The Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has held that once the duty has been paid in cash, earlier payments made through the Cenvat Account are liable to be re-credited to the Account and no objection that such re-credit was not on the basis of any eligible document can be adopted by the department.

The bench of P.K. Choudhary (Judicial Member) has observed that the suo motu credit of Cenvat reversed earlier involved only an account entry reversal and, in the process, no outflow of funds from the assessee, and accordingly, filing of a refund claim under Section 11B of the Central Excise Act, 1944, is not required.

ITAT

Interest Income Earned By A Co-Operative Society Eligible For Deduction: ITAT

Case Title: Amore Commercial Premises Co-Op Society Ltd. Versus Central Processing Centre

The Mumbai Bench of the Income Tax Appellate Tribunal (ITAT) held that interest income earned by a co-operative society on its investments held with co-operative banks would be eligible for claim of deduction under section 80P(2)(d) of the Income Tax Act.

The two-member bench of Kuldip Singh (Judicial Member) and S Rifaur Rahman (Accountant Member) found that the CIT(A) erred in upholding the assessee's denial of deduction under Section 80P(2)(d).

Hire Charges Received Under ‘Time Charter Agreement’ Not Taxable As Royalty, If Control Over Ship Remained With Owner: ITAT

Case Title: Nan Lian Ship Management LLC versus ACIT (Int. Tax)

The Mumbai bench of the ITAT has ruled that hire charges received by the owner of a ship for chartering its vessel under a ‘Time Charter Agreement’, is not taxable as ‘royalty’ under Section 9(1) (vi) of the Income Tax Act, 1961, if control and dominance over the ship remained with the assessee/ owner and not with the charterer.

2% TDS Deductible On Common Area Maintenance Charges: ITAT

Case Title: HV Global Pvt. Ltd. Versus ITO

The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) has held that 2% TDS is deductible on common area maintenance charges.

The two-member bench of C.M. Garg (Judicial Member) and Pradip Kumar Khedia (Accountant Member)has observed that the common area maintenance charges were not part of the actual rent paid to the owner by the assessee company. Payments of rent and common area maintenance charges have been made to distinct entities or companies; therefore, the authorities below were not right in creating the liability payable by the assessee firm.

Assessing Officer Not Justified In Rejecting Audited Books Of Accounts For Producing Photocopy Of Bills: ITAT

Case Title: Blue Stampings & Forgings Ltd. Versus Dy. Commissioner of Income Tax

The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) has held that the assessing officer was not justified in taking drastic action and rejecting books of account that are audited solely on the basis of general remarks that photocopies of the bills have been produced instead of original bills.