This weekly round-up analytically summarizes the key stories related to the Supreme Court and High Court reported at Taxscan.in during the previous week from February 20 to February 26, 2021.
Glaxosmithkline Pharmaceuticals Ltd. vs Asst./Deputy Commissioner of Income ) Tax Circle
The Bombay High Court has quashed the Section 148 notices as assessment could not have been reopened at all by the Jurisdictional Assessment Officer. The division bench of Justice N.J.Jamadar and Justice K.R.Shriram has held that petitioner is therefore directed to pay the amount of Rs.30,54,398/- as mentioned in the revenue audit objections. Respondents are directed to raise the demand on petitioner for this amount and petitioner shall pay the amount within time prescribed in the demand.
M/s Fairdeal Shipping Agency Pvt Ltd vs The Joint Commissioner Of Customs (Preventive)
The Rajasthan High Court has held that the DRI Officer has no competent authority to issue show cause notice and adjudicate the same as “proper officer” under Customs Act. The division bench of Chief Justice Akil Kureshi and Justice Sameer Jain has held that the entire proceedings initiated by officers of DRI in as much as by issuance of show cause notice under Section 28/124 of the Customs Act lacks jurisdiction and are without any authority of law because the present show cause notice is not issued by custom officer but by DRI officer who has not been assigned specific function/power under Section 6 to issue show cause notice U/S 28 of the Act of 1962. DRI officer is not Competent Authority to issue show cause notice and adjudicate the same as “proper officer”. The Act, the notification relied upon, does not define and bring the DRI officers within four corners of “proper officers” having functions and powers to act under Section 28 of the Act of 1962.
The Rajasthan High Court has referred the issue of interest on compensation for motor accident claims exigible to tax, does the insurance companies are required to deduct TDS to Larger Bench. The division bench of Chief Justice Akil Kureshi and Justice Uma Shanker Vyas has observed that divergent views amongst different High Courts on the point. In writ petition No.2902/2016-Shri Rupesh Rashmikant Shah Vs. Union of India and Ors. decided on 08.08.2019, a Division Bench of Bombay High Court has dealt with this issue at length and come to the conclusion that interest on the compensation awarded for motor accident claim cases upto the date of award is not exigible to tax. Madras High Court in case of Cholamandalam General Insurance Co. Ltd Vs. M. Ashok Kumar and Ors. reported in 2020 (4) CTC 53 has referred the issue to the Larger Bench.
M/s. Globus Petroadditions Pvt. Ltd. vs Union of India
The Bombay High Court has quashed the Order rejecting GST Refund Application, and directed the Commissioner to pass order after granting the opportunity of being heard. The court has directed the Assistant Commissioner is directed to comply with the Orders in Appeal passed by the Commissioner (Appeals-II) Central Tax Pune, within four weeks from the date of communication of this order and to pass an appropriate order in accordance with law without being influenced by the observations made and the conclusion drawn in the said Order.
Munish Rajkumar Mahajan vs Union of India
The Bombay High Court while directing the Authority to issue discharge certificate after payment held that SVLDR scheme to unload baggage of pending litigations centering around service tax and excise duty. The division bench of Justice N.R.Borkar and Justice R.D.Dhanuka has held that the impugned order is contrary to the object, the purpose and the intent of the Central Government to frame the said scheme as one time measure for liquidation of past disputes of central excise and service tax as well as to ensure disclosure of unpaid taxes by a person eligible to make a declaration and the basic thrust of the scheme is to unload the baggage of pending litigations centering around service tax and excise duty and deserves to be quashed and set aside.
Macrotech Developers Limited vs Assistant Commissioner of Income Tax, Central ) Circle 7(3), Mumbai
The Bombay High Court has quashed the reopening of Assessment as a condition precedent to valid exercise of power to reopen assessment, after lapse of 4 years. The division bench of Justice R.N.Ladha and Justice K.R.Shriram has set aside the impugned notice dated 27 March 2019 issued under Section 148 of the Act as well as the impugned order passed by the Assistant Commissioner of Income Tax – Respondent rejecting the petitioners objections to reopen the assessment for the Assessment Year 2012-13.
Ezzy Electricals vs State of Gujarat
The Gujarat High Court has held that taxpayers entitled to claim Input Tax Credit (ITC) and a technical glitch in GST Portal should not deprive him of such a claim. The court directed the respondents to do the needful and see to it that the writ applicant is able to claim the Input Tax Credit by uploading the Form ITC – 01. Let this exercise be undertaken at the earliest and completed within six weeks from the date of receipt of the writ of this order. One copy of this order shall be furnished at the earliest to Mr. Sharma for its onward communication.
M/s IPCA Laboratories LTD vs Commissioner
The Gujarat High Court has directed the GST Authority to Refund IGST in Electronic Credit Ledger for SEZ Unit. The division bench of Justice J.B.Pardiwala and Justice Nisha M.Thakore has held that the writ applicant could be said to be entitled to claim the refund of the IGST lying in the Electronic Credit Ledger as there is no specific supplier who can claim the refund under the provisions of the CGST Act and the CGST Rules as Input Tax Credit is distributed by the input service distributor.
Amit Harishkumar Doctor vs Union of India
A two-judge bench of the Gujarat High Court, while quashing an order for confiscation by the customs department, held that the order is not sustainable under the law since the show cause notice was issued beyond the statutory limit.
Commissioner of Income Tax (Exemption) vs Hamdard National Foundation (India)
The Delhi High Court has held that in the absence of an independent inquiry, the revenue authorities cannot solely rely on the opinion of property broker firms and websites to determine the adequacy of rent received for invoking section 13(2)(b) of the Income Tax Act, 1961.
R.K. Transport Private Limited vs Union of India
A two-judge bench of the Jharkhand High Court comprising Justices Aparesh Kumar Singh and Deepak Roshan has quashed the demand of interest for the delay in filing GSTR-3B for the reason that the GST department has not initiated appropriate adjudication proceedings before confirming such demand.
M/s Utkarsh Ispat LLP vs State of Gujarat
The Gujarat High Court bench consisting Justices J B Pardiwala and Nisha M Thakore while quashing an order of provisional attachment, held that the GST officials cannot provisionally attach personal properties of a partner of a partnership firm without final determination about the liability of the firm, which is accused of wrongly availing input tax credit (ITC).
Tvs Suguna Cutpiece Center vs The Appellate Deputy Commissioner (GST)
In a major relief to the taxpayers facing problems with restoration of GST registration even after payment of tax amount, penalty and filing of GST registration, the Madras High Court directed the GST department to restore such registrations in order to avoid problems to the taxpayers and the loss of revenue to the department.
Shalaka Infra-Tech India Pvt. Ltd. vs Union of India
The division bench of Justice R D Dhanuka and Justice S M Modak of the Bombay High Court has expressed its concern over the allegations made by several assessees in various petitions about the repeated summons issued by the GST authorities for the purpose of harassment, coercion and recovery of substantial amounts during the stage of investigation itself without issuance of a show cause notice.
Rakesh Garg vs Principal Commissioner of Income Tax
The Rajasthan High Court has held that a clarification issued by the Central Board of Direct Taxes (CBDT), being declaratory in nature, cannot introduce a cut off date for its applicability. Allowing the writ petition, the bench concluded that “A clarification by its very nature is declaratory. If for applicability of such clarification a cut off date is introduced it would run counter to the very concept of a clarification. If the CBDT circular is not read-down as to remove the rigors of the cut off date by holding that the same is not sacrosanct the same may suffer from vice of arbitrariness.”
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