Tax Weekly Roundup: November 25 - December 01, 2024
Kapil Dhyani
3 Dec 2024 10:15 AM IST
HIGH COURTS
Allahabad HC
Case Title: M/s A.V. Pharma Thru. Its Prop. Smt. Madhu Vohra v. State of U.P. Thru. Prin. Secy. State Tax Lko. and 2 Ors.
Case no.: WRIT TAX No. - 264 of 2024
The Allahabad High Court has held the time extension notification dated 24.04.2023 extending time period for passing orders under Section 73(9) and 73(10) of the Uttar Pradesh Goods and Service Tax Act, 2017 will apply only from 31.03.2023 and not before that.
“… the notification dated 24.04.2023 would be applicable retrospectively but only from 31.03.2023 meaning thereby, if the time limit of three years prescribed in sub Section 10 of Section 73 read with sub Section 1 of Section 44 expired prior to 31.03.2023 then the notificaiton dated 24.04.2023 extending the time limit for passing of an order under sub Section 9 of Section 73 would not be applicable, apparently so,” held the Division Bench comprising Justice Rajan Roy and Justice Manish Kumar.
Case Title: Agmotech Fabrics Private Limited v. State of Uttar Pradesh and Ors.
Case no.: WRIT TAX No. - 1757 of 2024
While deciding a case relating to Input Tax Credit, the Allahabad High Court has held that a quasi-judicial body must provide an opportunity of hearing to a person before imposing liability on them.
The Division Bench comprising Justice Shekhar B. Saraf and Justice Vipin Chandra Dixit held that as per the doctrine of audi alteram partem (let the other side be heard as well), such orders cannot be passed without providing the assessee a proper opportunity to make present their case. It was held that documents relied upon by the authorities while passing orders must be provided to party who is being held liable.
Delhi HC
Case title: Pr. Commissioner Of Income Tax – 04 v. M/S Gragerious Projects Pvt. Ltd.
Case no.: ITA 90/2020
The Delhi High Court has made it clear that when the Revenue proposes to impose penalty on an assessee under Section 271(1)(c) of the Income Tax Act, 1961 for alleged 'concealment of particulars of income' or for 'furnishing inaccurate particulars of income'- it must specify which one of the two charges it seeks to press and the Revenue cannot be permitted to club both.
A division bench of Justices Yashwant Varma and Ravinder Dudeja reasoned that the proceedings for initiating penalty are penal in nature, which may result in imposition of penalty ranging from 100 to 300% of the taxability and therefore, the chargemust be “unequivocal and unambiguous”.
Case title: Designco v. UoI (and other connected matters)
Case no.: W.P.(C) 14477/2022
The Delhi High Court has held that a misclassification or an incorrect classification of goods to be imported or exported would not ipso facto amount to collusion, wilful misstatement, or suppression of facts under Section 28AAA Customs Act, 1962.
In its 91-page judgment, the Court also pointed out that the MEIS certificate is issued under the provisions of the Foreign Trade (Development and Regulation) Act, 1992 and held that the power to cancel or suspend it vests in the Director General of the licensing authority alone.
Case title: NRA Iron And Steel Pvt Ltd v. Income Tax Department & Ors.
Case no.: W.P.(C) 3537/2021
The Delhi High Court has held that a review petition, against the orders passed in SLP by the Supreme Court, is “Disputed Tax” under Section 2(1)(j) of the Direct Tax Vivad Se Vishwas Act, 2020 and the review petitioner would be eligible to take benefit of “Vivad Se Vishwas Scheme”.
Section 2(1)(j) defines disputed tax in relation to Appeal, Writ Petition or Special Leave Petition pending as on the specified date, in this case January 31, 2020.
Case title: Designco v. UoI (and other connected matters)
Case no.: W.P.(C) 14477/2022
The Delhi High Court has held that pursuant to an audit in respect of assessment of imported or exported goods under Section 99A of the Cutoms Act, 1962, the proper officer is liable to apprise the auditee of the objections which according to it arise in respect of the assessment.
A division bench of Justices Yashwant Varma and Ravinder Dudeja discussed the power that stands enshrined in Section 99A (Audit) and stands further articulated in the Audit Regulations, particularly Regulation 5.
Case title: Niraj Silk Mills v. Commissioner Of Customs (ICD) (and other connected matters)
Case no.: CUSAA 26/2022
The Delhi High Court has held that where enhancement of valuation of goods by the proper officer for the purpose of determining Customs duty is accepted by the importer under protest, for expeditious clearance, it cannot be said that the importer has waived its right to question the reassessment. Pertinent to note that Section 17 of the Customs Act, 1962 relates to 'Assessment of duty'. Sub-section (5) provides that in a case where the importer confirms his acceptance of the reassessment in writing, the proper officer would stand relieved of the obligation of passing a speaking order in respect of such reassessment. In all other cases where the reassessment is not acceded to, the proper officer is obliged to pass a speaking order.
Kerala HC
Case Title: Kerala Infrastructure and Technology For Education v. Union Of India
Case Number: WP(C) NO. 12864 OF 2024
The Kerala High Court stated that financial grants provided to the assessee for covering daily operational expenses do not qualify as payment (consideration) for any services that the assessee might be providing and are not liable to tax.
The Bench of Justice Gopinath P. observed that “The assessee has only received grants to meet its day-to-day expenses including salary, allowances etc. Such payment cannot be deemed to be a consideration for the alleged services rendered or for goods supplied by the assessee. The revenue has no case that the activity of the assessee falls within Scheduled-I”.
Case : Pinnacle Vehicles and Services Pvt Ltd v. Joint Commissioner
Case no.: WP(C) NO. 25724 OF 2024
A single bench of the Kerala High Court has referred to the division bench the issue relating to the cross-empowerment of State officials under Section 6(1) of the Goods and Services Act.
Justice P Gopinath passed the reference order in a writ petition filed by a company challenging a show-cause notice issued by the State authorities.
Madras HC
Case Title: M/s. SPK and Co. v. The State Tax Officer
Case Number: W.P.(MD)Nos.27787
The Madras High Court stated that limitation period for challenging assessment orders under section 107 of GST Act commences from the date of rejection of the rectification application filed under section 161.
The Bench of Justice K. Kumaresh Babu observed that “…the period of limitation for challenging the order of assessment shall start ticking from the date of rejection of the rectification application…”
Patna HC
Case Title: M/s Barhonia Engicon Private Limited v. The State of Bihar
Case Number: Civil Writ Jurisdiction Case No.4180 of 2024
The Patna High Court has rejected a petition challenging Notifications extending timeline for issuance of Orders under Section 73(10) of the GST Act.
The Division Bench, comprising Chief Justice K. Vinod Chandran and Justice Partha Sarthy was dealing with the case where the assessees/petitioners filed writ petition against Notification Nos. 13/2022-Central Tax, 9/2023-Central Tax & 56/2023-Central Tax which extended the dates for issuing orders under Section 73(10) of the GST Act.
Rajasthan HC
Case Title: M/s Sunshine Exim v. Directorate General Of GST Intelligence Jaipur Zonal Unit
Case Number: D. B. Civil Writ Petition No. 16379/2024
The Rajasthan High Court stated that the provisional attachment under Section 83 of the CGST Act ceases after one year and cannot be attached again without giving fresh reasons. The Division Bench, consisting of Chief Justice Manindra Mohan Shrivastava and Justice Ashutosh Kumar, was dealing with a case in which the assessee challenged the department's attachment of their bank account on the grounds that, according to Section 83(2) of the CGST Act, the provisional attachment of a bank account ceases to have effect after one year.
