The Income Tax Appellate Tribunal (ITAT), Pune bench has held that royalty/fee for technical services (FTS) taxable at the rate of 10% as per the Double Taxation Avoidance Agreement (DTAA) between India and Singapore.
The Tribunal bench comprising Vice President R S Syal and Judicial Member Partha Sarthi Chaudhary was considering the issue of taxability of Rs.3,88,94,824/- received by the assessee, a Switzerland based nonresident, from its Indian affiliate, namely, Rieter India Private Limited (RIPL).
The two-member bench observed that the receipt of Rs.3.84 crore is neither reimbursement nor royalty for software as the assessee rendered I.T. services to its group companies including RIPL and offered a sum of Rs.20.04 crore to tax as royalty/fees for technical services. The assessee contended that the same is not taxable.
“We have further found that the nature of services provided under the Master Agreement for which Rs.20.04 crore has been offered to tax is exactly similar to that claimed to be reimbursement for which Rs.3.84 crore has been received. In fact, there is only one Master agreement with RIPL under which the composite I.T. services were rendered to the group companies including RIPL – whether with the help of own software or those purchased from third party vendors,” the bench observed.
While dismissing the appeal filed by the assessee, the Tribunal held that “On a pertinent query as to whether revenue of Rs.20.04 crore received by the assessee from RIPL towards I.T. Services was offered and taxed as Royalty or Fees for technical services, as the same treatment would be given to Rs.3.84 crore as well, the ld. AR submitted it did not make any difference as both the royalty/FTS are taxable at the rate of 10% under the DTAA. We, therefore, hold that the authorities below were fully justified in including Rs.3,88,94,824/- in the total income of the assessee and charging it to tax at 10% in parity with the assessee suo motu offering Rs.20.04 crore to tax at that rate.”
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The Institute of Cost Accountants of India (ICMAI) has released the guidelines for the Course Fee Waiver Scheme.
The Council of the Institute has granted a Course Fee Waiver Scheme in the form of scholarship to the aspiring CMA student at Intermediate/ Final level who unfortunately lost his/her father or mother or guardian due to COVID 19, who was the earning member of his/her family. This Scheme is titled “Course Fee Waiver Scheme for CMA Students Financially Affected due to COVID-19”.
The main objective of this scheme is to waive the Course Fee to the benefit of aspiring CMA students at the Intermediate/ Final level who have been financially affected because of the untimely death of their earning parent/guardian (in case of an adopted child whose parents are no more) due to COVID 19.
This guideline has been effective for the benefit of the students pursuing CMA Courses at the Intermediate/Final level on or after 28th June 2021. The duration of this scheme is initially for a period of 1 year from the date of notification, subject to review.
To be eligible for this scheme the income of the existing parent/guardian shall not exceed Rs.2 lacs per annum for the last financial year. Students claiming course fee waiver under the scheme should be unemployed and depend solely on the income of the parents/guardians.
Students who have registered/ to be registered themselves to the Intermediate Course of the Institute on or after 28th June 2021 Students who have enrolled/ to be enrolled themselves to the Final Course of the Institute on or after 28th June 2021 shall be eligible for the scheme. The Scheme will not be applicable for the students who have registered/enrolled before 28 June 2021 as per the records of the Institute.
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The Delhi bench of the Income Tax Appellate Tribunal (ITAT) has held that the registration under section 12 of the Income Tax Act, 1961 cannot be denied to International Centre for Research on Women Ltd. (‘ICRW’) merely because it is for the benefit of a restricted group of employees.
ICRW is a non-profit organization with the object of promoting social and economic development with women’s full participation and is incorporated as a limited company under section 25 of the Companies Act, 1956.
Relying on a catena of decisions, Judicial Member Kuldip Singh and Accountant Member O P Kant held that the registration of the assessee trust cannot be rejected merely on the ground that it is for the benefit of a restricted group of employees of the company ‘ICRW’. With a direction to the Assessing Officer to re-consider the claim on the basis of documents and other evidence, the Tribunal held that “However, we find some merit in the argument of the Ld. DR that trust has been engaged in discharging the statutory obligation of the company “ICRW’ of making gratuity payments to their employees. But in this regard the competent authority has not examined the activities actually carried out by the trust, sources of funds, and how the same are distributed to the employees, whether by way of creating the trust, the company is getting some benefit of saving of money, whether any activity of welfare of the employees other than making gratuity payment has been carried out by the trust, etc. The assessee has also not filed any information with regard to its activities before us.”
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In a major relief to ESPN Star Sports, the Income Tax Appellate Tribunal (ITAT), Delhi bench has held that the entity is not taxable in the absence of a Business Connection or PE in India in view of the provisions of the Double Taxation Avoidance Agreement (DTAA) between India and Mauritius.
ESPN Star Sports is a partnership firm established under the laws of Mauritius and is engaged in the business of selling advertisement time and program sponsorship from Mauritius in connection with the programming via non-standard television on ESPN, Star Sports, and Star Cricket programming services. The assessment history of the appellant shows that for the past A.Ys., ESPN India has been held to be dependent agent PE and fixed place PE of the assessee. During the course of assessment proceedings for A.Y 2005-06 and 2006-07, it was revealed that there was a considerable change in the activities as compared with the earlier years. The Assessing Officer, based on the same, assessed the total income of the assessee and raised demand.
The two-member bench of the Tribunal comprising Judicial member Amit Shukla and Accountant Member N K Billaiya relied on the decision of the Supreme Court in the case of E-funds IT Solutions Inc. wherein the Apex Court laid down a test for whether there is fixed place PE.
“Considering the past history of the assessee in light of the decision of this Tribunal read with the decision of the Hon’ble Supreme Court in the case of E-funds IT Solutions Inc. [supra], we hold that the assessee has no business connection in India in terms of section 9(1) of the Act and has no PE under Article 5(2), 5(4) and 5(5) of India Mauritius DTAA,” the Tribunal said.
“Since we have held that there is no PE, we are of the considered view that there cannot be any attribution of profit as held by this Tribunal in assessee’s own case in A.Ys 2009-10 and 2011-12,” the Tribunal added.
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The Calcutta High Court held that the provisional attachment order ceases to have validity after the expiry of 180 days under the Prevention of Money Laundering Act (PMLA).
The petitioner, Gobindo Das has challenged the impugned Provisional Attachment Order passed by the Deputy Director, Enforcement Directorate attaching his bank accounts in question under Section 5 (1) of The Prevention of Money Laundering Act, 2002 on the ground that the validity of the said impugned Provisional Attachment Order has lost its force and ceased to have any validity under Section 5 (3) of the aforesaid Act after the expiry of 180 days on 9th June 2021 and in view of the fact that the adjudicating authority has not passed any formal order on or before 9th June 2021 under Section 8(3) for confirmation or further extension of the aforesaid impugned Provisional Attachment Order dated 11th December 2020.
The petitioner contended that after the expiry of 180 days from the date of the aforesaid attachment order, Respondent has become functus officio, and further there is no provision under the aforesaid Act for an automatic or deemed extension of the Provisional Attachment Order under Section 5 (1) of the aforesaid Act. Petitioner is aggrieved by the action of the respondent in not allowing him to operate his bank account in question even after the expiry of the validity of the aforesaid order of provisional attachment.
On the other hand, Enforcement Authorities opposing the Writ Petition and defending the action of the Respondent authority in not allowing the Writ Petitioner to operate the bank accounts in question contends that even without passing any formal order of confirmation or further extension under Section 8 (3) of the Act after the expiry of 180 days of validity of the aforesaid impugned Provisional Attachment Order, the aforesaid impugned Provisional Attachment Order automatically should be deemed to have been extended by claiming benefit of the order of the Hon’ble Supreme Court dated 23rd March, 2020 in Suo moto Writ Petition (Civil) No. 3 of 2020 Re-cognizance For Extension Of Limitation which was extended from time to time and lastly on 27th April, 2021 where the Hon’ble Supreme Court in view of the steep rise in Covid-19 Virus cases engulfing the entire nation and the extraordinary situation caused by the outburst of Covid-19 Virus resulting difficulties by the litigants and advocates in filing petitions/applications/suits/appeals and all other proceeding irrespective of period of limitation prescribed in general or special law extended a period of limitation until further orders.
The single bench of Justice Md. Nizamuddin held that the Adjudicating authority cannot be called a litigant or advocate or a quasi-judicial authority and cannot take the benefit of the order of the Hon’ble Supreme court passed in Suo moto Writ Petition (Civil) No. 3 of 2020 by taking the stand that on the expiry of the validity of the said provisional attachment order after 180 days under Section 5 (3) of the aforesaid Act, the same would be deemed to have been extended automatically by virtue of the aforesaid order of the Hon’ble Supreme Court when he was not required to pass any formal order of extension of the same under Section 8 (3) of the PMLA.
“I am of the considered opinion that such stand of the Respondent No. 2 is legally not sustainable since the impugned order of provisional attachment of bank accounts and postal accounts in the question of the petitioner, dated 11th December 2019, which has expired its validity on 9th June 2021, has no force after expiry of 180 days from the date of passing of such order in view of not passing any formal order under Section 8 (3) of the said Act extending the validity of the same by the Respondent No. 2 and the action of Respondent No. 3 is not allowing the petitioner to operate its bank and postal accounts in question after the expiry of the period validity of 180 days from the date of the order passed under Section 5 (1) of the aforesaid Act, such action of the Respondent Enforcement authority, is arbitrary and illegal,” the court said.
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The Uttarakhand High Court quashed the Order of cancellation of GST Registration due to the non-providing opportunity of Hearing and remitted the matter back to GST Authority.
The petitioner, Eficaz Project Limited Liability Partnership challenged the cancellation of the GST Registration on the ground that Section 29(2) specifically creates a statutory obligation, that in an eventuality, where the registration is required to be canceled, under either of the modes, i.e. on account of the commission of the default or on account of an application submitted by the registered assessee, the opportunity of hearing is mandatory, required to be provided.
Mr. S.K. Posti, Senior Counsel for the petitioner contended that once he himself as a partner of a partnership firm has submitted an application for cancellation of his GST registration which was filed on 30th May 2020, in that eventuality, under Sub-rule (3) of Rule 22 of the Rules framed under the Act, the decision on the application submitted for the cancellation of the registration was required to be taken by the respondent within a period of 30 days as provided therein. In case, if no decision is taken, within a period of 30 days, in that eventuality, the respondent becomes functus officio, to pass any order on the application which was submitted by the person concerned for cancellation of the registration and hence, any subsequent cancellation of registration after the expiry of the aforesaid period would be without jurisdiction.
Mr. Posti further pointed out that even if at all a decision was required to be taken on an application submitted by the petitioner requesting for the cancellation of the registration, if at all, the decision was required to be taken after the expiry of the period of 30 days, as provided under Sub-rule (3) of Rule 22 of the Rules, in that eventuality too, the implications of Sub-section (2) of Section 29 of the Act, ought to have been followed and the petitioner should have been mandatorily provided with an opportunity of hearing and in the absence of there being any prior show cause issued to the petitioner, calling his explanation, the order of cancellation of his registration would be apparently and statutorily bad in the eyes of law.
The single bench of Justice Sharad Kumar Sharma ruled that even if the impugned order of 12th July 2021, is taken into consideration, there is not even a single whisper that after the expiry of 30 days, as provided under Sub-rule (3) Rule 22, when the cancellation was being resorted to, though apart from the fact that the officer concerned has become functus officio after the expiry of 30 days, even if at all, the cancellation was required, in that eventuality, then the petitioner ought to have been heard.
The court remitted the matter to the respondent to take appropriate action and decision thereon too, only after providing an opportunity of hearing to the petitioner and the decision on the same would be taken within a period of 30 days.
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The Jharkhand High Court quashed the Show Cause Notice in respect of wrongful availment of Input Tax Credit (ITC) as it was vague and lacked details.
The petitioner, M/s Nkas Services Private Limited has challenged the show-cause notice issued under Section 74 of the JGST Act on the grounds that it was vague and does not disclose the offense and contraventions as it is a mere mechanical reproduction of the provisions of Section 74 without striking of the irrelevant portions. It is thus incapable of any reply and does not fulfill the ingredients of a notice in the eyes of law. Petitioner would be denied the opportunity to properly defend itself. It is, therefore, in violation of the principles of natural justice. The essential requirements of the proper notice are that it should specifically state charges to which the notice has to reply.
The petitioner has sought to quash the impugned show-cause notice issued under Section 74 of the Act being in violation of principles of natural justice and lacking in jurisdictional facts to initiate a proceeding under Section 74 of the Act on the allegations that the petitioner has wrongfully availed the input tax credit by reason of fraud or any willful misstatement or suppression of facts to evade tax or not paid or short paid or erroneously got a refund of any tax.
The division bench of Justice Aparesh Kumar Singh and Justice Anubha Rawat Choudhary noted that the impugned show-cause notice does not fulfill the ingredients of proper show-cause notice and thus amounts to a violation of principles of natural justice, the challenge is entertainable in the exercise of writ jurisdiction of this Court.
Accordingly, the court has ruled that the impugned notice and the summary of show-cause notice in Form GST DRC-01 are quashed.
“However, since this Court has not gone into the merits of the challenge, respondents are at liberty to initiate fresh proceedings from the same stage in accordance with law within a period of four weeks from today,” the court said.
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The Karnataka High Court directed the Good and Service Tax (GST) Authority to permit the filing of TRAN-1 either electronically or manually within 30 days.
The subject matter of the Writ Petition was substantially similar to the one treated by a Division Bench of the Court between Union of India Vs. M/s At AND S India Pvt. Ltd., disposed off on 1.4.2021 wherein while dismissing the present writ appeal, 30 days time is granted to the assesses to submit their GST TRAN-1.
The single bench of Justice Krishna S. Dixit held that respondents are directed to permit the petitioner to file/revise TRAN-1 either electronically or manually within a period of thirty days.
“Like cases should be decided alike, being the operational norm, there is no reason for this court to deny the relief to the petitioner who is similarly circumstanced qua the respondent in the subject Writ Appeal,” the court noted.
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The Institute of Chartered Accountants of India (ICAI) has announced the setting up of the Branch of EICASA Brahmapur with effect from October 14th, 2021.
“In pursuance of Regulation 81(5) of the Chartered Accountants Regulations, 1988, read with Rule 4 of the Chartered Accountants Students’ Association Rules the Council of the Institute of Chartered Accountants of India is pleased to announce the setting up of Branch of EICASA Brahmapur with effect from October 14th, 2021,” the ICAI notified.
The Branch shall be known as the Brahmapur Branch of EICASA.
As prescribed under Rule 4(b) of the Chartered Accountants Students’ Association Rules, the Branches shall, at all times function subject to the control, supervision, and direction of the Central Council exercised through the Regional Council or the Regional Students’ Association and shall be governed by the directions issued by the Central Council from time to time, for the functioning of the Branches of Students’ Association or such other directions that may be issued from time to time.
Regulation 81(5) of the Chartered Accountants Regulations, 1988 pertains to the Constitution of Students’ Associations which reads as, “the Council may establish a branch of a students’ association and may issue such directions as it may consider expedient in regard to the duties and functions of the branch.”
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The Gujarat High Court held that a bank cannot withhold original documents of property even after receiving the entire payment on a home loan on the grounds that dues of another loan taken under Pradhan Mantri Mudra Yojana (PMMY) have not been paid.
The petitioner, Manisha Brahmbhatt was in need of financial assistance and therefore, respondent, Bank of Baroda advanced a term loan of Rs. 9,80,000/-. The petitioner created a mortgage by way of security for the term loan advanced by the respondent-Bank with respect to the piece and parcel of the immovable property.
According to the petitioner, the entire dues of the respondent-Bank was cleared and therefore, the petitioner requested for return of the original title document of the property in question along with no due certificate. However, the respondent-Bank did not return the original documents nor any discharge deed for the mortgaged property was executed.
Mr. Rajput, the counsel on behalf of the petitioner submitted that the respondent-Bank cannot withhold the original documents as the petitioner has repaid the entire dues of the term loan of Rs. 9.80 lacs advanced by the respondent-Bank.
On the other hand, learned advocate Mr. Meena, the counsel for the respondent bench submitted that after availing financial assistance by way of Rs. 9.80 lakh as term loan, the respondent-bank has advanced another financial assistance of Rs. 5 lakh under Pradhan Mantri Mudra Yojna which is still outstanding, and therefore, unless and until the said amount of loan is repaid by the petitioner, the respondent-Bank cannot release the original document nor execute any deed for discharge of mortgaged property in view of the term loan agreement executed by the erstwhile Dena Bank which is now merged with the respondent-Bank.
The single bench of Justice Bhargav D. Karia held that the respondent-bank has committed an error by withholding the original documents of the petitioner in respect of the term loan of Rs. 9.80 lakh which is fully paid by the petitioner. The respondent-bank could not have withheld the original documents of the mortgaged property in question once the petitioner has repaid the loan as the financial assistance advanced by the respondent-bank under PMMY Scheme is advanced without any collateral security.
“The petition succeeds and is accordingly allowed. Respondent-bank is directed to hand over all the original documents of the property in question which is mortgaged by the petitioner for availing financial assistance of Rs. 9.80 lakh in the year 2017. The respondent bank is also directed to execute the deed of discharge of the mortgaged property forthwith. The respondent-bank shall complete such exercise within a period of four weeks from today,” the court-ordered.
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The Delhi Bench of Income Tax Appellate Tribunal (ITAT) quashed the re-assessment Proceedings as information on the basis of which AO formed belief of escapement of income was wrong.
The Assessing Officer had formed the belief that the income of the assessee, Madan Mohan Tiwari had escaped assessment on the basis of information that the assessee had total receipt of about Rs.1.76 crores as per Form No.26AS and further that the assessee had not filed the return of income for the year under consideration. However, on the receipt of notice u/s 148 of the Act, the assessee filed objections against the reopening of the assessment stating therein that the information on the basis of which the Assessing Officer had formed belief of escapement of income was, in fact, wrong information.
In fact, the assessee had duly filed his return of income, and further, all the receipts could not be construed as the income of the assessee.
The coram of Accountant Member R.K. Panda and Judicial Member, Sanjay Garg ruled that when it has been brought to the knowledge of the Assessing Officer that the information on the basis of which he (Assessing Officer) had formed belief of escapement of income was in fact wrong information, then the very belief of the Assessing Officer of escapement of income of the assessee on the basis of such information also ceased to exist. The Assessing Officer, under the circumstances, should have applied his mind afresh to the fresh information brought to his knowledge.
“If after duly considering the records including the ITR of the assessee, the Assessing Officer would have been still of the view that there was reason to believe that the income of the assessee has escaped assessment, then, under those circumstances, the Assessing Officer was supposed to record fresh reasons to believe that the income of the assessee has escaped assessment, whereupon, the assessee should have been given an opportunity to file his objections and the Assessing Officer was accordingly supposed to proceed in accordance with the law,” the ITAT said.
The ITAT observed that it was brought to the knowledge of the Assessing Officer that the information on the basis of which he has formed belief of escapement of income of the assessee, was wrong, still, the Assessing Officer proceeded to frame the assessment on the basis of the aforesaid wrong information which was the basis for the formation of his belief. Under these circumstances, it cannot be said that the Assessing Officer has proceeded in accordance with the law. Framing of the assessment on the basis of the information, which was wrong information to the very knowledge of the Assessing Officer, in our view, cannot be held to be justified, nor can the same be said to be information to form the belief that the income of the assessee has escaped assessment. The reassessment framed on the basis of such wrong information and wrong belief is not sustainable in the eyes of law and the same was quashed.
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The Punjab and Haryana High Court quashed the entire proceedings as Joint Director, DRI is not ‘the proper officer’ to issue show-cause notice.
The petitioner, M/s Steelman Industries has stated in the application that the Supreme Court of India in M/s Canon India Pvt. Ltd. held that the Joint/Additional Director (in short “DRI”) is not the “proper officer” to issue show cause notice under Section 28(4) of Customs Act, 1962 and that in the present case also the show cause notice culminating into the order-in- original dated 15.05.2015 has been issued by the Joint Director, DRI.
The challenge is made to the order-in- original which was passed in pursuance of the show cause notice issued by the Joint Director, DRI, Ludhiana Regional Unit.
Several issues have been raised in the present writ petition including the issue that the Joint Director, DRI is not the ‘proper officer’ and has no jurisdiction to issue the said show-cause notice. It has specifically been stated that as per Rule 16 of the Customs and Central Excise Duties and Service Tax Drawback Rules 1995, only the ‘proper officer’ of the customs department can raise the demand.
The petitioner has further been stated that as per settled law, once the show cause notice has been issued by an incompetent authority, then the entire proceeding subsequent to the same, is also illegal in law.
The division bench of Justice Ajay Tiwari and Justice Vikas Bahl in the light of the various judgments passed by the Supreme Court and various other Courts clearly held that one of the issues which have been raised in the present writ petition to the effect that the Joint Director, DRI is not ‘the proper officer’ to issue show cause notice has been held in favor of the petitioner. It has further been held that the entire proceedings stand vitiated and are required to be set aside.
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The Ministry of Commerce and Industries has notified the guidelines for reorganization including change of name, shareholding pattern, constitution, directors of SEZ Developers, and SEZ Units.
The government has conveyed that Reorganization including change of name, change of shareholding pattern, business transfer arrangements, court-approved mergers and demergers, change of constitution, change of Directors, etc. may be undertaken by the Unit Approval Committee (UAC) concerned subject to the condition that the Developer / Co-developer / Unit shall not opt-out or exit out of the Special Economic Zone and continues to operate as a going concern. All liabilities of the Developer / Co-developer / Unit shall remain unchanged on such reorganization.
Such reorganization shall be subject to various safeguards. Seamless continuity of the SEZ activities with unaltered responsibilities and obligations for the altered entity; Fulfilment of all eligibility criteria applicable, including security clearances, etc., by the altered entity and its constituents; Applicability of and compliance with all Revenue / Company Affairs / SEBI, etc. Acts / Rules which regulate issues like capital gains, equity change, transfer, taxability, etc.; Full financial details relating to change in equity/merger, demerger, amalgamation or transfer in ownership, etc. shall be furnished immediately to Member (IT&R), CBDT, Department of Revenue and to the jurisdictional Authority. The Assessing Officer shall have the right to assess the taxability of the gain/loss arising out of the transfer of equity or merger, demerger, amalgamation, transfer, and ownerships, etc. as may be applicable and eligibility for deduction under relevant sections of the Income Tax Act, 1961. The applicant shall comply with relevant State Government laws, including those relating to the lease of land, as applicable. The applicant shall furnish details of PAN and jurisdictional assessing officer of the unit to CBDT. The applicant shall be recognized by the new name or such arrangement in all the records.
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The Kerala High Court while granting the refund to the taxpayer ruled that all the technical glitches that may occur in between, shall not stand in the way of ultimate relief of the grant of refund to the petitioner.
The Petitioner, Dantara Jewellers assailed the order wherein the petitioner’s claim for refund of taxes paid under Central Goods and Services Tax as well as State Goods and Services Tax have been refused on the ground that there is no evidence to prove the payment of tax by the petitioner.
As per the order of demand of tax and penalty issued under section 129(3) of the State Goods and Services Tax Act, the petitioner remitted an amount of Rs.12,26,064/-. Thereafter, the petitioner challenged the final orders passed under section 129(3) of the State Goods and Services Tax Act, before the Appellate Authority. By virtue of the order, the petitioner was found not liable for payment of any amount of tax, and the Appellate Authority quashed the orders.
The petitioner became entitled to a refund of the amount deposited under section 129(3) of the State Goods and Services Tax Act, for the release of the goods. Pursuant to the order, the petitioner filed an application for a refund of the amount deposited. In the meantime, the respondent issued a show-cause notice to the petitioner asking him to show cause why the claim of the petitioner for refund ought not to be rejected on the ground of absence of details of remittance of the tax amount, as claimed by the petitioner.
The single-judge bench of Justice Bechu Kurian Thomas directed the respondent authority to refund the amount of Rs.12,26,064/-, due to the petitioner as a refund, within a period of 30 days from the date of receipt of a copy of this judgment. All the technical glitches that may occur in between, shall not stand in the way of ultimate relief of the grant of refund to the petitioner as otherwise the sanctity of the whole scheme of section 129 of the State Goods and Services Tax Act will lose the confidence of the assessees to deposit the amount as contemplated under section 129 of the State Goods and Services Tax Act, will be affected.
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The Directorate General of Foreign Trade (DGFT) has issued the Public Notice stating that all agencies enlisted under Appendix 2E of FTP-2015-20, who have on-boarded on Common Digital Platform for electronic Certificate of Origin (Non–Preferential), can issue CoO (NP) on all India basis with effect from November 1, 2021.
“The Directorate General of Foreign Trade authorizes agencies currently enlisted under Appendix 2E to issue Certificate of Origin (Non-Preferential) (Co0 NP) for all India jurisdiction. Accordingly, all currently enlisted agencies under Appendix 2E can now issue Co0 (NP) on an all-India basis. Further, any new application for enlistment under Appendix 2E will be considered for all India Jurisdiction and separate applications for enlistment of branch offices for already enlisted agencies will not be required,” the notification said.
The DGFT notified, “all Agencies as notified under Appendix-2E are required to ensure the onboarding exercise for mandatory electronic filing of CoO (NP) through the Common Digital Platform (URL: https://coo.dgft.gov.in ) latest by 31st October 2021 failing which the agencies may be de-notified from Appendix 2E.”
An application for grant of CoO (NP) may be made by the Registered/Head Office/Branch Office/Factory of the applicant to any agency registered under Appendix 2E in India.
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The Director-General of Foreign Trade (DGFT) has notified the extension of the Date for Mandatory electronic filing of the Non-Preferential Certificate of Origin (CoO) through the Common Digital Platform to 31st October 2021.
The DGFT informed all Exporters or Members of Trade and issuing agencies that the electronic platform for Certificate of Origin (CoO) which was made life for issuing preferential certificates under different FTAs, has now been expanded to facilitate electronic application for issuance of Non-Preferential Certificates of Origin as well.
On the request of certain Chambers/Associations notified under Appendix-2E, the existing system of manual/paper-based submission and processing of non-preferential CoO applications is being extended further upto 31st October 2021 only and the online system is not being made mandatory.
“All Agencies, as notified under Appendix-2E, are required to ensure that the onboarding exercise is completed latest by 31st October 2021 failing which the agencies shall be de-notified from Appendix 2E. The concerned agencies may reach out over email to ddg2egov-dgft[at]gov[dot]in for any guidance or clarifications in regard to the on-boarding process,” the DGFT notified.
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The Amritsar Bench of Income Tax Appellate Tribunal (ITAT) allowed Section 12A Registration to an Educational Welfare Society as leasehold land and fee concession was verified.
An application in Form No.10A was filed by the appellant society, Lord Shiva Educational Welfare Society in the office of PCIT(Exp), Chandigarh seeking registration u/s 12A of the Income Tax Act, 1961. The application revealed that the society is an ongoing entity that has been in operation since 30.01.2013.
Earlier an order under section 12AA of the Income Tax Act was passed by the Commissioner of Income Tax (E), Chandigarh in this case on 30.08.2017 rejecting the application for grant of registration u/s 12AA. The applicant trust preferred an appeal before the Hon’ble Income Tax Appellate Tribunal, Amritsar against the order of the Commissioner of Income Tax (E), Chandigarh. The Hon’ble ITAT, Amritsar has restored back the case of the applicant trust for fresh consideration.
The Department while rejecting the application has contended that as the character of the school is commercial per se and is hit by the provisions of Section 2(15) of the Act, giving fee concessions to some of its students would not take aware the commercial character of the school/society. Since the primary issue of the society/school remains to be commercial with the profit motive through commercial agreement, the admissions of certain poor students by giving them fee concessions would not undermine the non-charitable character of the society.
The coram of Judicial Member Lalit Kumar and Accountant Member Dr. M. L. Meena held that nothing has been doubted and for the purpose of 12A, only two conditions are to be required to be satisfied that one with regard to the activities of the trust and the second with regard to the aims & objects of the society as per the decided case laws on this issue which have been addressed in favor of the assessee by the earlier order of the Coordinate Bench.
“We are of the considered view, that the jurisdiction of the PCIT(E) was being limited to verification of two issues, one with regard to the ‘leasehold land’ and the second about the fee concession and on both accounts, and since, the CIT (E) has not drawn any adverse inference and, therefore, in our view, the order of CIT(E) denying the registration u/s 12AA is bad in law,” the ITAT ruled.
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The Gujarat High Court Gujarat HC refused the Anticipatory Bail to Directors of Company allegedly involved in wrongfully availing ITC on the basis of fake bills.
The applicants, Nileshbhai Natubhai Patel, Divya Arvindbhai Monpara, Rohitbhai Bhikhabhai Chauhan are the Directors of the Madhav Copper Limited who are allegedly claimed to purchase the material worth Rs.762.00 crores, which in fact has not purchased but fake bills have been obtained so as to wrongfully claim Input Tax Credit and the said purchases have been allegedly made from 36 different firms and companies. It is further alleged that the applicants thereby evaded payment of State Tax worth Rs.137.00 crores by claiming wrongful Input Tax Credit as the suppliers have not paid tax to the Government though collected from the applicant’s Company.
The applicants contended that since no FIR has been filed against the applicants, arrest of the applicants under Section 69 of the GGST Act cannot be made. The applicants have submitted that to date, the department has not determined the liability of the applicants after the process of adjudication. It is submitted that even after adjudicating the liability of the applicants, an appeal can be filed before the appellate authority under Section 107 of the GGST Act where there is a provision that if 10% of the liability is fixed by the adjudicating authority is deposited, the stay can be granted.
The single-judge bench of Justice Vipul M. Pancholi while refusing the anticipatory bail said that if the applicants are enlarged on anticipatory bail then, there are all chances that the applicants will tamper with the evidence and witnesses and at the time of trial, the applicants would not be available.
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The Telangana Authority of Advance Ruling (AAR) ruled that GST is exigible on EPF, ESI, Salary, or Wages reimbursed by Hospital.
The applicant, Bhagyalakhsmi Devamma Vangimallu whose trade name is M/s. Versatile Resource Solutions has entered into a contract with M/s. Asian Institute of Gastroenterology Private Limited, Somajiguda, Hyderabad for providing Housekeeping services. As per the memorandum of Understand the applicant will provide Housekeepers and supervisors to maintain and assist the medical team of the Hospital in maintaining cleanliness, covering 24 Hours service on a shift basis.
It is the opinion of the applicant that as the salary or wages are fixed by the Hospital management and as EPF, ESI is statutory payments, therefore these amounts reimbursed by the Hospital management cannot form the value of supply.
The applicant has sought the advance ruling on the issue of whether the applicant is liable to pay tax on the number of wages/salaries, EPF/ ESI, etc., reimbursed by the client.
The applicant submitted that they are passing on the Salary, ESI, PF, etc., received from the contractee to the persons employed in housekeeping. The same is passed on to the persons employed. However, they are charging commission/charges against each such bill. Therefore in their view, they are pure agents of the contractee, and as such the amounts received by them and passed on to the employees do not form turnover at their hands.
The coram of Members, S.V.Kasi Visveshwara Rao and B.Raghu Kiran ruled that the applicant is not a pure agent under GST Law. Further, the deductions available under Section 15 of the CGST Act do not include the amounts pertaining to EPF, ESI, Salary, or Wages. Therefore the entire amount received from the Hospital is exigible to CGST / SGST Act 2017.
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The Ahmedabad bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has held that the department cannot confirm a demand solely on the basis of third-party evidence without providing an opportunity to the manufacturer to cross-examine such evidence.
The appellant M/s. Meera Pipes Pvt. Ltd. is engaged in the manufacture of SS Pipes falling under Chapter 73 of the Central Excise Tariff Act, 1985. They were availing the benefit to SSI Exemption from duty and also from obtaining Central Excise Registration as they claimed that the clearance value does not exceed the threshold limit under the exemption notification. The department raised a demand for excise duty finding that the appellant have clandestinely removed the goods which resulted in exceeding the threshold limit of SSI Exemption due to which the appellant is not eligible for SSI Exemption. The decision was based on third-party evidence following a search conducted on the premises of the appellant.
Judicial Member Ramesh Nair and Technical Member Raju observed that the appellant’s name is not appearing anywhere in the documents.
“This document was admitted as evidence by the Adjudicating Authority accepting the version given by the M/s. JBFC and on the basis of the same appearing in the diary A/1 & A/2. Since the director, Shri Aashuram has categorically denied the diaries and the transporter was not cross-examined, the version of the transporter cannot be admitted as evidence. Similarly, We have gone through various documents which were relied upon but in none of the documents the name is appearing, therefore, without any detail of appellant correlating the document, only on the basis of the statements of the third party who were not examined under Section 9D cannot be accepted as admissible evidence,” the Tribunal observed.
“It is settled law that in absence of cross-examination of witnesses whose statements were recorded under Section 14 of the Central Excise Act, 1944, unless and until those witnesses are cross-examined, the statements given by them are not admissible evidence for deciding a case. Therefore, in the present case firstly all the evidence is third parties’ evidence and no cross-examination in terms of Section 9D was allowed off the witnesses, therefore, such evidence could not have been used for confirming the demand,” the Tribunal held while allowing the appeal.
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The Chandigarh bench of the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has held that the Additional Director General, DRI is not a “proper officer” for sending show cause notice for the payment of customs duty or interest under the provisions of the Customs Act, 1961.
Before the Tribunal, the appellants, Modern Insecticides Limited has challenged the order passed by Commissioner, Customs, Ludhiana wherein Show Cause Notice has been issued by Additional Director General, DRI, Ludhiana.
The appellants contended that the order needs to be quashed since Additional Director General, DRI, Ludhiana who is not a proper Officer to issue Show Cause Notice under Section 28 (4) read with Section 2 (34) of Customs Act, 1962.
Judicial member Ashok Jindal and Technical Member Sanjiv Srivastava observed that although Review Petition filed by the Revenue has been pending before the Hon’ble Apex Court in the above-said case but thereafter in the case of Commissioner of Customs Kandla vs. M/s. Agarwal Metals & Alloys (supra) again the Hon’ble Apex Court has followed up the decision of Canon India Pvt. Ltd. (supra) and hold that the Additional Director General, DRI is not a proper Officer within the meaning of Section 28 (4) read with Section 2 (34) of Customs Act, 1962.
“Further, the said decision has been followed by the Hon’ble Madras High Court in the case of Quantum Coal Energy Pvt. Ltd. (supra) and the jurisdictional Hon’ble High Court of Punjab & Haryana in the case of Steelman Industries vs. Union of India & Ors,” the Tribunal said.
Allowing the appeal, the Tribunal held that “the Additional Director General, DRI, Ludhiana is not a proper Officer to issue Show Cause Notice under Section 28 (4) read with Section 2 (34) of Customs Act, 1962. Therefore, the impugned proceedings are set aside.”
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