This weekly round-up analytically summarises the key stories related to the Supreme Court and High Court reported at Taxscan.in during the previous week from November 21 to November 24, 2022.
PIYUSH AMBALAL GANDHI vs DY COMMISSONER OF INCOME TAX CIRCLE 2 –2022 TAXSCAN (HC) 923
A division bench of the Gujrath High Court by allowing a petition held that re-assessement power could not be exercised for the purpose re-verification. After considering the contention of the both side, the bench of Justice N.V.Anjaria and Justice Bhargav D. Karia allow the petition and observed that “Condition for taxability of policy surrender value is that the amount invested was claimed as relief under Section 80CCC (1) of the Act which is not the case here.” Hence the re-assessment powers could not be exercised either for the purpose of re- verification or to have a merry sailing for a rowing inquiry.
GPL-RKTCPL JV vs NATIONAL FACELESS ASSESSMENT CENTRE –2022 TAXSCAN (HC) 922
A Division Bench of the Delhi High Court transferred matter to Higher Bench to decide admissibility of writ petition when jurisdictional Assessing Officer (AO) was located outside National Capital Territory (NCT) of Delhi. The petitioner in the present appeal is RKKR Foundation. The Bench consisting of Justice Manmohan and Justice Manmeet Pritam Singh Arora observed that “Keeping in view the complexity of the legal issues involved and since we have doubted the correctness of the view expressed by a coordinate bench of this Court in RKKR Foundation wherein it had decided to exercise its jurisdiction in a similar matter where the JAO was located outside the NCT of Delhi, we are of the considered view that the aforesaid questions of law requires to be settled and decided by way of an authoritative pronouncement by a larger bench of this Court.”
Pooja Singhal vs Directorate of Enforcement –2022 TAXSCAN (HC) 921
Recently in a significant case in connection with Money laundering, the Jharkhand High Court denied bail to Indian Administrative Services (IAS) officer Pooja Singhal and held that Property derived or obtained as a result of criminal activity was regarded as tainted property. The Court viewed that a sum of Rs.01.33 crore had been deposited in the form of cash in the name of the brother of her Chartered Accountant and her mother and therefore, it cannot be said that she was not using the proceeds of the crime in light of section 2(1)(u) of the PML Act.
M/S ROCKLAND MEDIA AND COMMUNICATION PVT. LTD vs UNION OF INDIA AND 5 ORS –2022 TAXSCAN (HC) 917
In a relief to the taxpayers who could not avail the GST transitional credit due to technical glitches on the portal and thereafter manually, the Gauhati High Court has directed the assessee to avail the benefit of re-opening of the portal till 30th November. Justice Michael Zothankhuma observed that in terms of the Circular No. 180/12/2022-GST dated 09.09.2022, the time period for availing transitional credit through Tran- & Tran-2 has been extended up to 30.11.2022. “In view of the submissions made by the counsels for the parties and as per their agreement, the writ petition is disposed of to enable the petitioner to take the benefit of the order dated 22.07.2022 passed by the Apex Court in Union of India & Anr v. Filco Trade Centre Pvt. Ltd & Anr. and the Circular No. 180/12/2022-GST dated 09.09.2022,” the High Court observed.
Graphic aids vs Sales Tax Officer –2022 TAXSCAN (HC) 919
Considering the fact that the GST department has recovered more than 50% of the total dues, a division bench of the Calcutta High Court has kept the garnishee order in abeyance. A bench of Justice T. S. Sivagnanam and Justice Hiranmay Bhattacharyya has partly allowed the appeal and set aside the order with a direction to the appellant to file an application before the revisional authority clearly setting out all facts and requesting the revisional authority to recall the order disposing of the revisional application and if such an application is filed, the revisional authority shall take up the same and pass a speaking order on merits and in accordance with law after affording an opportunity of personal hearing to the authorised representative of the appellant.
M/S DABUR INDIA LIMITED vs COMMISSIONER OF INCOME TAX (TDS) AND ANOTHER –2022 TAXSCAN (HC) 920
In an interim relief to M/s Dabour India Limited, a division bench of the Delhi High Court has directed the income tax department to re-consider the stay applications. Directing a re-consideration of the applications, the division bench has held that “the impugned order is set aside and the matter is remanded back to the Commissioner of Income Tax for fresh decision on the application for stay. However, before deciding the stay application, the Commissioner of Income Tax shall grant a personal hearing to the authorised representative of the Petitioner. For this purpose, list the matter before the Commissioner of Income Tax on 05th December, 2022.”
ROHUL AMIN vs STATE OF ASSAM –2022 TAXSCAN (HC) 916
A Single Bench of the Gauhati High Court rejected anticipatory bail on GST evasion case as there was repeated calling from the side of Rohul Amin, the petitioner in the present case to compromise matter. The Bench of Justice Kalyan Rai Surana while disallowing the anticipatory bail noted that “The informant has referred to mobile call screenshots to project that the petitioner had been repeatedly calling the informant and Anjuman Kumar Sharma to mount pressure to them to compromise the matter. This does amount to breach of the conditions on which interim pre-arrest bail was granted to the petitioner. Under such circumstances, the Court does not find this to be a fit case for grant of pre-arrest bail to the petitioner.”
MAHABIR JAIN SHYAMSUKHA vs CENTRAL BUREAU OF INVESTIGATION –2022 TAXSCAN (HC) 915
The Gauhati High Court granted bail to Mahabir Jain a businessperson who was arrested in connection to the GST Commissioner Bribery case. A Bench of Justice Robin Phukan observed that “Having regards to the nature of accusation and the punishment prescribed for the same, as well as the submission of the Advocates of both sides, more specially the period of detention, and further keeping in mind the dictum of the Supreme Court in Satender Kumar Antil, I am of the considered opinion that further custodial detention of the accused seems to be unwarranted and it is a fit case where the privilege of bail can be extended to the accused.”
Nuvoco Vistas Corporation Ltd vs The Union of India and Ors– 2022 TAXSCAN (HC) 914
The Bombay High Court allowed to file GST TRAN-1 regard to distribution and eligibility of ISD credit of Service Tax, and thereby granting relief to Nuvoco Vistas Corporation Ltd, the petitioner. A Bench consisting of Justice KR Shriram and Justice AS Doctor observed that “The petitioner, through its respective units/offices registered under CGST Act and/or State Acts, as the case may be, can avail this window and file GST TRAN-1/revised GST TRAN-1 at the units/offices. The GST TRAN-1/revised GST TRAN-1 filed by the units/offices will be basis the manual ISD invoices issued/to be issued by ISD of petitioner subject to aggregate credit cumulatively not exceeding the ISD credit available with petitioner of Rupees Thirteen Crores Forty Three Lakh Nine Two Thousand and Nineteen.”
ICAi Vs UNION OF INDIA & ANR. –2022 TAXSCAN (SC) 202
While considering a petition by the Institute of Chartered Accountants of India (ICAI) challenging the eligibility criteria of an accountant member appointed to the Income-tax Appellate Tribunal under the Income-tax Act, 1961, the Supreme Court has issued notice to the centre. A Bench of Justices M.R. Shah and M.M. Sundresh issued notice on Monday, stated that “Application for amendment is allowed. Issue notice, returnable on 02.01.2023. Dasti, in addition, is permitted.”
COMMISSIONER OF COMMERCIAL TAXES vs TATA STEEL LIMITED –2022 TAXSCAN (HC) 913
In a major relief to Tata Steel, the Calcutta High Court has allowed a plea seeking to grant of refund of excess CST paid as a purchasing dealer. Justice T.S. Sivagnanam and Justice Supratim Bhattacharya observed that the lower rate of tax granted is under a Central Legislation and the State of West Bengal is only an agent of the Central Government to collect the correct rate of tax in accordance with the provisions of the CST Act.
Euro Pratik Sales Corporation vs Union of India and Ors –2022 TAXSCAN (HC) 912
The Bombay High Court ordered Restoration of Cancelled GST registration for ITC (Input Tax Credit) Transition of Rs thirty -nine lakhs. A Bench consisting of Justice K R Shriram and Justice AS Doctor observed that “Here is a case, in our view, petitioner cannot be permitted to forgo a sum of Rupees thirty-nine lakhs which according to petitioner is entitled to deemed excised credit particularly when under sub-section 3 of Section 29 his liability will continue even after cancellation of registration. It will be wholly unfair if petitioner ends up having to forgo the deemed excise credit of a substantial amount.”
PRINCIPAL COMMISSIONER OF INCOME TAX vs RISHIKESH BUILDCON PVT. LTD– 2022 TAXSCAN (HC) 910
The Delhi High Court quashed penalty under Section 271D of the Income Tax Act, 1961 on the ground that there was lapse of six months on penalty proceedings on violation of cash transactions under Section 269SS of the Income Tax Act. A Bench comprising of Justice Manmohan and Justice Manmeet Pritam Singh Arora observed that “The ITAT was correct in law in deleting the penalty imposed by the Additional Commissioner of Income Tax, under Section 271D of the Income Tax Act, on the ground that the penalty order, was passed beyond the time period prescribed by Section 275(1)(c) of the Income Tax Act, the same having been passed after the lapse of six months from the end of the month in which the penalty proceedings were initiated by the AO.”
M/s. Renaissance Global Limited vs . Union of India – 2022 TAXSCAN (HC) 911
A Division Bench of the Bombay High Court ruled that Customs Act has no jurisdiction with in Special Economic Zone (SEZ)Act, 2005and held that M/s. Renaissance Global Limited eligible for Customs Duty Exemption on import of scrap jewellery. A Bench consisting of Justice AS Doctor and Justice K R Shriram observed that the Customs Act have no jurisdiction to investigate, seize and issue SCN under SEZ Act and quashed all the notices and orders issued by the Respondents. The petitioner was also held eligible for customs duty exemption on import of scrap jewellery.
A.M.Ahamed & Co. vs Commissioner of Customs –2022 TAXSCAN (HC) 909
The Madras High Court (HC) has held that the Order passed by Settlement Commission cannot be adjudicated by co-noticees, Customs duty over CHA is not imposable. The Division Bench considered the order passed by the Settlement Commission and concluded that when the importer had escaped liability, the CHA cannot be mulcted with a liability and the benefit has to ensure in favour of the CHA also. Accordingly, the writ appeal came to be dismissed by an order dated 02.07.2015. It was observed by the HC that once an order of settlement is passed by the Settlement Commission, the case cannot be adjudicated by other co-noticees. Further observed that if the proceedings against the importer have come to an end, it will be discriminatory and unfair to continue the proceedings against the CHA in relation to the very same transaction.
Birsa Minerex vs Sales Tax Officer –2022 TAXSCAN (HC) 908
A division bench of the Orissa High Court, while invalidating a VAT re-assessment order has held that the same cannot be made solely on the basis of audit objection under the Orissa VAT Act. Quashing the assessment, the Court held that “In absence of power of review conferred by or under the statute, in the garb of reassessment, the concluded assessment could not be reopened by the Assessing Authority. As the material available on record does not show independent application of mind of the Assessing Authority having regard to the material in his possession, if any, merely based on objection of Auditor General, Odisha issue of notice in Form IVA in exercise of power under Rule 12(4) of the CST(O) Rules for reopening Audit Assessment concluded under Rule 12(3) on examination of books of account, etc. is impermissible in law and such an action is without jurisdiction.”
VIKRAM BHATNAGAR vs ASSISTANT COMMISSIONER OF INCOME TAX –2022 TAXSCAN (HC) 904
The Delhi High Court has held that the notice served under section 143(2) of Income Tax Act in the name of dead assesse is null and void. The high court bench comprising of Justice Manmohan and Justice Manmeet Pritam Singh Arora held that the assessment order was null and void referring Savita Kapila vs. Assistant Commissioner of Income Tax. The high Court observed that the notice under Section 143(2) of Income Tax Act of was issued against the dead person and the assessment order had also been passed against the dead person on his PAN without bringing on record of legal representatives. And set aside the assessment order and all consequential notices.
RSB Transmissions (India) Limited vs Union of India –2022 TAXSCAN (HC) 907
A division bench of the Jharkhand High Court has held that the electronic cash ledger (ECL) is merely an “e-wallet” and therefore, the liability to pay interest arises on delayed filing of GSTR-3B return and debit of tax due from the Electronic Cash Ledger are independent. Dismissing the plea of the assessee, the Court concluded that “discharge of tax liability is simultaneous with the filing of GSTR 3B return under the scheme of GST regime and the provisions of GST Act intended to ensure seamless flow of movement of goods and services and payment of tax by the registered persons in the form prescribed through a digital mode maintained by GSTIN.”
Rakesh Kumar Singh vs – State Thru C.B.I./S.T.F. –2022 TAXSCAN (HC) 905
The Allahabad High Court has rejected a bail application by the then tax assistant for the alleged offense of granting fake refund claims by tampering with the electronic evidences and computer records. The petitioner, requested for bail. Opposing the bail application, the CBI submitted that similar applications filed by co-accused, Sanjeev Kumar Sinha and Arun Kumar Srivastava, have been rejected by this Court vide detailed common order dated 27.07.2018. Referring to the above order, Justice Dinesh Kumar Singh observed that “Considering the fact that 482 applications filed by the said coaccused have already been rejected, this application is also rejected having no merit and substance. Interim order, if any, stands vacated.”
SRI MUNA PANI vs STATE OF ODISHA –2022 TAXSCAN (HC) 906
In a petition challenging the show-cause notice issued by the GST department on ground of discrepancies in the GSTR 3B, the Orissa High Court has held that the GST Act provides adequate safeguards,entertainment of the writ petition at the stage of notice would be premature. Doing so would frustrate the tax administration and interdict adjudication process.
K C ANTONY vs THE PRINCIPAL COMMISSIONER –2022 TAXSCAN (HC) 902
The Kerala High Court, recently ruled that no limitation is prescribed under the Income Tax Act, 1961 for filing application for condonation of delay. A Single Bench consisting of Justice Gopinath P observed that “The delay to be condoned was not to be considered with reference to the date on which the application under Section 119(2)(b) of the Income Tax Act was filed, but with reference to the date on which the ‘application for refund’. Section 119(2)(b) of the Income Tax Act does not impose any limitation for the purposes of filing an application for condonation of delay.”
Tata Steel Limited vs State of Jharkhand –2022 TAXSCAN (HC) 901
In a major relief to Tata Steels, a division bench of the Jharkhand High Court has granted an interim stay of recovery of VAT demand subject to payment of 20% of demand. The petitioner, Tata Steels approached the High Court challenging an order of the Commercial Taxes Tribunal, pertaining to the Assessment Year 2002-03 wherein the Tribunal upheld there assessment proceedings initiated upon audit objection under section 17(2) read with section 19(1) of Bihar Finance Act, 1981.
Support our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates.
This weekly round-up analytically summarizes the key stories related to the Income Tax Appellate Tribunal (ITAT) reported at Taxscan.in during the previous week from November 12 to November 18, 2022 M/s Piyush Overseas Pvt. Limited vs DCIT – 2022 TAXSCAN (ITAT) 1667 The Chandigarh Bench of ITAT held that, the assessee cannot be said to…
The Income Tax Appellate Tribunal (ITAT), Delhi bench has held that commission paid to partners is not covered under Section 194H of the Income Tax Act and therefore, the same is not subject to TDS deduction. The assessee, M/s. Sareen Sports Industries is a sports goods manufacturer. While verifying the income tax returns filed by…
The Central Government has re-appointed Smt. Revathy Iyer, Director, Central Board of Reserve Bank of India (RBI) on the Board of Directors of National Bank for Agriculture and Rural Development (NABARD) for a period of three years.
A notification issued by the Ministry of Finance on Monday stated that “In exercise of the powers conferred by clause (c) of sub-section (1) of Section 6 of the National Bank for Agriculture and Rural Development Act, 1981 (61 of 1981), the Central Government, in consultation with the Reserve Bank of India, hereby re-appoints Smt. Revathy Iyer, Director, Central Board of Reserve Bank of India (RBI) on the Board of Directors of National Bank for Agriculture and Rural Development (NABARD) w.e.f. 06.08.2022 for a period of three years or until further orders, whichever is earlier.”
Ms. Revathy Iyer was a former Deputy Comptroller & Auditor General – Govt. Accounts (December 2013 – May 2014). Prior to this, she was Additional Deputy Comptroller & Auditor General – Eastern States (September 2012 – December 2013) and was responsible for the CAG Audit Reports on the Accounts of the States of Andhra Pradesh, Odisha, Tamil Nadu, and West Bengal and Puducherry. From October 2007 -March 2012, Ms. Iyer served as Joint Secretary in the Department of Atomic Energy, Government of India, formulating/ overseeing policy, budget, and implementation of the program/activities of the Department.
Ms. Iyer was the chairperson of the Government Accounting Standard Advisory Board (GASAB) constituted in 2002 to formalize standards of government accounting and integrate the accounting system and procedures in different wings of the Government under the umbrella of Uniform Common Accounting Standards.
Post-retirement she worked as a Director of Finance & Operations in an International NGO (EngenderHealth) from September 2015 to March 2017.
Born on May 28, 1954, Ms. Iyer holds a Master’s Degree in Chemistry from the University of Delhi.
Subscribe Taxscan Premium to view the JudgmentSupport our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates.
The Gauhati High Court has granted bail to a Commissioner of Service Tax (Appeals) who is involved in a case registered by the Central Bureau of Investigation (CBI) for allegedly demanding bribe for passing a favourable order to the assessee. A complaint was filed by Shri Chittaranjan Nath, who preferred an appeal before the Commissioner…
In a significant move, the Centre is most likely to bring some major amendments to the capital gain tax structure in order to bring more clarity. The legislative changes are expected to be made in the Finance Act, 2023.
Changes in capital gains tax in India are expected in the next budget, an income tax official from India’s finance ministry said on Tuesday. Reportedly, the official, speaking at an event in New Delhi, said India would exceed budget estimates for direct tax collection by 25-30% in FY2023.
It was revealed that the Government will likely to revamp the capital gains tax structure in the next budget to augment revenue collections and boost spending on welfare schemes.
“Making the capital gains tax structure more efficient needs legislative amendments. This may be taken up in the next budget as it cannot be done out of the blue,” an official said earlier. Long-term vs short-term capital gains At present, long-term capital gains are in general taxed at 20%. In India, long-term capital gains on listed equities held for over a year is taxed at 10% on the portion of such gain above a threshold of ₹1 lakh. This provision was introduced with effect from 1 April, 2019,” sources said.
The capital gains tax regime prescribes the holding period for determining whether the gain made when selling the asset is short term or long term.
“The capital gains tax regime is slightly complex. There is a case for simplifying and rationalising it,” said a government official aware of the deliberations.
The task force, headed by former Central Board of Direct Taxes (CBDT) member Akhilesh Ranjan, had suggested three categories of assets: equity, non-equity financial assets, and all others including property.
The taskforce further proposed indexation benefits for all categories except equities. The panel suggested long-term capital gains (LTCG) tax of 10% for gains on the sale of equity assets held for more than 12 months. For equities held for a shorter period, a 15% short-term capital gains tax was proposed. For non-equity financial assets held for over 24 months, an LTCG of 20% with indexation was proposed for gains on sale. In the case of all other assets, a 20% tax with indexation on gains on sale post holding a period of 36 months was proposed.
Support our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates.
This weekly round-up analytically summarizes the key stories related to the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) reported at Taxscan.in during the previous week from November 5 to November 11, 2022. Dinesh Chandra Dubey vs Commissioner of Central Goods & Service Tax – 2022 TAXSCAN (CESTAT) 603 The Customs, Excise & Service Tax…
In a recent ruling, the Punjab and Haryana High Court has held that the Genpact India cannot be treated as an “intermediary” and therefore allowed a refund of Rs.26,34,61,625/- in favor of the Company.
The petitioner challenged an order of the GST department wherein it has been held that the services provided by the petitioner are in the nature of “Intermediary Services” as per Section 2 (13) of the IGST Act and do not qualify as “export of services” in terms of Section 2 (6) of the Act and thereby rejecting the refund claim of un-utilized Input Tax Credit (ITC) used in making zero rated supplies of services without payment of Integrated Goods and Service Tax.
A division bench comprising Justice Tejinder Singh Dhindsa and Justice Deepak Manchanda observed that the MSA dated 01.01.2013 (Annexure P-1) entered between the petitioner and GI is clearly for the purpose of sub-contracting services to the petitioner by GI. These are the very services which GI was contractually supposed to provide to its own customers.
“A bare perusal of the recitals and relevant clauses of the MSA reproduced hereinabove do not in any manner indicate that petitioner is acting as an “intermediary” so as to fall within the scope and ambit of the definition of “intermediary” under Section 2 (13) of the IGST Act. Such clauses cannot also be interpreted to conclude that the petitioner has facilitated the services. The said clauses are in relation to the modalities of how the actual work would be carried out and do not in any manner establish that the petitioner was required to arrange/facilitate a 3rd party to render the main service which has actually been rendered by the petitioner,” the Court observed.
Allowing relief to the assessee, the Court held that the services provided by the petitioner are in the nature of “Intermediary Services” as per Section 2 (13) of the IGST Act and do not qualify as “export of services” in terms of Section 2 (6) of the Act and thereby rejected the refund claim of un-utilized Input Tax Credit (ITC) used in making zero rated supplies of services without payment of IGST.
Subscribe Taxscan Premium to view the JudgmentSupport our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates.
The Supreme Court two-judge Bench of Justice M R Shah and Justice M M Sundresh recently held that a second reassessment notice issued to the assessee due to a change of Assessing Officer is not valid.
The petitioner-revenue, challenging the decision of the Delhi High Court in a writ petition filed by the assessee, AVAIDS Technovators Pvt. Ltd (formerly Mastech Technologies Pvt. Ltd.), approached the Apex Court in a Special Leave Petition(SLP).
The Bench observed that the ground taken by the High Court for quashing the reopening is not sustainable and quashed the High Court’s order.
A second Show Cause Notice (SCN) was issued on the same grounds to the assessee for reopening the assessment after the first notice was served. The assessee had declared a loss of approximately 6.10 Lakh Rupees. The second notice was issued by the Assessing Officer (AO) who came after the transfer of the existing AO.
The AO, after issuing notice to the assessee, heard the assessee and rejected the claims, subsequently adding Rs. One Crore Thirty-Five Lakhs and Two Lakh Forty-Three Thousand on account of accommodation entry and commission respectively.
Aggrieved by this, the assessee approached the Delhi High Court to set aside the reopening of the assessment by a writ petition which was allowed and the assessment itself was set aside on grounds that a second SCN was issued.
The Supreme Court observed that “the assessee did not challenge the Assessment Order on merits which it ought to have challenged before the CIT-A and the High Court has set aside the Assessment Order on the ground that initiation of the reassessment is bad in law”.
Further directing the assessee to challenge the order before the CIT(A), on the merits and facts of the reassessment without going into the issue of the validity of the reassessment proceedings, the Supreme Court set aside the High Court’s decision.
Subscribe Taxscan Premium to view the JudgmentSupport our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates.
The Central Board of Indirect Taxes and Customs (CBIC) issued a circular today with guidelines and a checklist for verification of transitional credit from the legacy regime to the Goods and Services Tax (GST) regime, pursuant to the directions of the Supreme Court in Union of India vs. Filco Trade Centre Pvt. Ltd.
The Apex Court also directed that the common portal be opened for filing prescribed forms for availing Transitional Credit through TRAN-1 and TRAN-2 for two months from 01.10.2022 to 30.11.2022 for the aggrieved assessee, Filco Trade Centre Pvt. Ltd.
As per the circular issued today, the jurisdictional central tax officer shall refer the said claim for verification of the component of state/UT tax to his counterpart state/UT tax officer in cases where the applicant is under the jurisdiction of the central tax officer and where the transitional credit claimed has the component of state/Union Territory tax.
“For this purpose, he shall share the list of GSTINs/ARNs with the counterpart officer, in respect of which verification report is needed from him, on a weekly basis, along with an intimation of the same to the nodal officer of central tax as well as state/UT tax through his official email ID or physically. Similar action, as above, shall also be taken by the jurisdictional state/UT tax officers in cases where the applicant is under the jurisdiction of the state/UT tax officer and where the transitional credit claimed has a component of central tax also,” the circular said.
The jurisdictional tax officer shall, in parallel, continue the verification of the remaining portion of the transitional credit at his end.
“The taxpayers of Ladakh and Daman and Diu can file/ revise TRAN-1/ TRAN-2 only through their newly allotted GSTINs. It is, therefore, advised that the concerned jurisdictional tax officers should take into consideration transitional credit, if any, claimed by such taxpayers under their previous GSTINs,” the CBIC added.
The jurisdictional tax officers can access the TRAN-1/TRAN-2 filed/revised by the applicant on their back office systems (which is the CBIC-AIO portal for the central tax officers, the respective State portal for MODEL-1 States and BO portal for MODEL 2 States). Further, a self-certified downloaded copy of TRAN-1/TRAN-2 filed/revised by the applicant shall also be made available to the jurisdictional tax officer by the said applicant as mentioned in Para 4.5 of Circular 180/12/2022 dated 09.09.2022.
The jurisdictional tax officers can access the TRAN-1/TRAN-2 filed/revised by the applicant on their back office systems. Further, a self-certified downloaded copy of TRAN-1/TRAN-2 filed/revised by the applicant shall also be made available to the jurisdictional tax officer by the said applicant.
The jurisdictional tax officer shall start the verification process immediately on availability of TRAIN-1/TRAN-2 filed/revised by the applicant on the back office system or on receipt of self-certified downloaded copy of the same from the applicant, whichever is earlier. It is needless to mention that principles of natural justice shall be followed in the process of passing the order relating to allowance or disallowance of the Transitional Credit.
The jurisdictional tax officer shall, on the basis of declaration made by the applicant in the format specified in Annexure A to Circular no. 180/12/2022 dated 09.09.2022, and on the basis of data available on the back office system, shall check whether the applicant had earlier filed TRAN-1/TRAN-2 or not. In cases where TRAN-1/TRAN-2 had already been filed by the applicant earlier, the tax officer shall check whether there is any change from the earlier filed TRAN-1/TRAN-2 or not. In case, there is no change from the earlier filed TRAN-1/TRAN-2, then such claim of transitional credit is liable for rejection by the tax officer, through a reasoned order, after providing due reasonable opportunity to the applicant.
“After considering the facts of the case, including verification report received from the counterpart officer, submissions made by the applicant and the comments, if any, of the counterpart officer on the same, the jurisdictional tax officer shall proceed to pass a reasoned order, preferably within a period of fifteen days from the date of personal hearing, specifying the amount of transitional credit allowed to be transferred to the electronic credit ledger of the applicant an upload a pdf copy of the said order, on the common portal for crediting the amount of allowed transitional credit to the electronic credit ledger of the applicant,” CBIC said.
The Transitional Credit claimed by the applicant shall be credited in his electronic credit ledger to the extent allowed by the jurisdictional tax officer through an order after carrying out necessary verifications. As per the Hon’ble Court’s order, the said verification has to be carried out within 90 days after completion of the above window of two months, i.e. within 90 days from 01.12.2022 i.e. up to 28.02.2023.
Subscribe Taxscan Premium to view the JudgmentSupport our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates.
The Chennai Bench of the Income Tax Appellate Tribunal (ITAT) has recently held that payments provided for services rendered by marketing partners such as provision of pre-sale and after sale product services to the customers are taxable as Fees for Technical Services (FTS) as per the definition given in Section 9(1)(vii) of the Income Tax Act, 1971.
The Tribunal comprising Judicial Member V Durga Rao and Accountant Member G Manjunatha also added that the assessee, Sunsmart Technologies Pvt. Ltd. ought to have deducted TDS in terms of Section 195 of the Income Tax Act.
On behalf of the assessee, Authorised Representative Advocate D. Anand referring to marketing, agreement between the assessee and M/s.SSG Technologies, LLC, submitted that if you consider the scope of services rendered by the partner, it is in the nature of simple marketing services without any technical knowledge and thus, same cannot be classified as FTS as per Explanation-2 to Section 9(1)(vii) of the Income Tax Act.
The revenue, on the other hand, represented by Additional CIT Varuvooru Sreedhar, pointed out that in order to give pre-sale and post-sale services to product, the partner requires expertise in products manufactured by the assessee and thus, said services definitely comes under FTS.
The Tribunal observed that, “As per Explanation-2 to Sec.9(1)(vii) of the Act, FTS means any consideration (including in lump sum consideration) for the rendering of any managerial, technical or consultancy services, but does not include consideration for any construction, assembling, mining or like project undertaken by the recipient or consideration which would be income of the recipient chargeable under the head ‘salaries’ ”.
It was further observed by the Tribunal that “as per Explanation-2 to Section 9(2) of the Act, income of a non-resident shall be deemed to accrue or arise in India under Clause (v) or Clause (vi) or Clause (vii) of sub-section (1) and shall be included in the total income of the non-resident”. Examining the nature of services provided by the marketing partner, it was held that, “services rendered by M/s.SSG Technologies, LLC, definitely comes under ‘FTS’ as defined under Explanation-2 to Section 9(1)(vii) of the Income Tax Act” as “the scope of agreement clearly specifies the nature of services to be rendered by marketing partner and as per said agreement, the assessee will train the resources of marketing partner to provide pre-sale and after sale product services to the customers”.
Subscribe Taxscan Premium to view the JudgmentSupport our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates.
The Income Tax Appellate Tribunal (ITAT), Kolkata bench has held that since the assessee has duly offered the capital gain out of sale proceeds under the Income Declaration Scheme, 2016, the addition under section 68 of the Income Tax Act, 1961 is not sustainable.
The assessee, Jyoti Swaroop Kashuka (HUF) was aggrieved by the order of the income tax department making addition under section 68 of the Income Tax Act relying on the report of the Investigation Wing of the Department. On first appeal, the CIT(A), confirmed the order and made an extensive write-up on the subject matter of black money and plugging of loopholes in the system by the Revenue which has been garnered in the form of bogus long-term capital gain by the assessees through typical features of penny stock companies.
A two-member bench comprising Shri Sanjay Garg, Judicial Member and Shri Girish Agrawal, Accountant Member observed that in the same assessment order of the individual, the concerned Assessing Officer has noted that Shri Jyoti Swaroop Kashuka (individual) has disclosed the long-term capital gain being the sale proceeds under the IDS 2016 and paid taxes accordingly which was cross verified from the records available with the Department. Accordingly, the concerned Assessing Officer accepted the returned income of the individual.
“Admittedly, it is a fact that assessee has brought on record all the details relating to the mistake committed by the broker in respect of executing the sale transaction of 8000 shares of GCM securities Ltd, both before the ld. AO and the ld. CIT(A), along with relevant corroborative documentary evidence. Submissions made by the assessee before both the authorities have been reproduced in their respective orders. In our understanding, once the mistake is brought to fore and is in knowledge of the authority, it is incumbent upon the authority, who is possessed with all the powers, to take a deep dive into the matter to ascertain the correct facts and understand the mistake as well as see how the effect of mistake was mitigated,” the ITAT observed.
Granting relief to the assessee, the Tribunal held that “The factual matrix in the present case evidently demonstrates that a mistake was committed which was mitigated by the assessee and the relevant income arising from the transaction of sale of shares erroneously executed in the account of the assessee, was duly reported in the return of income of the individual, which was offered by the individual in the IDS 2016 and was accepted in the scrutiny assessment made under section 143(3) of the Act of the individual. We note that addition made by the ld. AO and sustained by the ld. CIT(A) is without going into the actual facts of the case.”
Shri K.K. Goswami, Advocate appeared for the assessee.
Subscribe Taxscan Premium to view the JudgmentSupport our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates.
Moonlighting is simply the side hustle or side gig that a person takes in addition to regular employment, usually without the consent of the primary employer. Several companies like Wipro, Infosys, IBM and recently Tech Mahindra have issued actions and notices against moonlighting that have raised alarm within the employees.
The tax implications of payments from additional assignments outside regular payments has become a concern for many professionals who work additional jobs and tax planners and practitioners alike.
It is pertinent to note that there are no separate provisions for moonlighting in the Income Tax Act, 1961 unlike income from profits and gains from business and profession.
The income received as business income or professional fees from moonlighting may be enquired into in a later period of time and if undeclared income is found, penalties may also be imposed.
The recipient must declare such income in his or her tax returns and duly pay the applicable income tax rate. A payee not deducting tax at source (TDS) or a recipient not declaring such income would amount to violation of the Income Tax law and invite action.
From the perspective of an individual or a company making a payment of more than Rs 30,000 to a person in return for a contract job (under Section 194C of Income Tax Act, 1961) or pays a professional fee (Section 194J, IT Act), they are liable to deduct TDS at the applicable rate. The TDS liability is also applicable if payments to the person exceed Rs 1 Lakh in a financial year under Section 194C.
If the moonlighting is done in a business owned or is of professional nature, the expenses incurred for such a second job can be deducted under Section 36. The remaining amount shall be offered to tax under Section 44AD, as applicable. But, if the side gig is listed as one of the professions listed in Section 44ADA and the net income is less than Rs. 50 Lakhs, then the option to pay tax on only 50% of their income can be availed at the price of not having the option to deduct expenses.
If the taxpayers receive the income from moonlighting as salary, then the standard deduction can only be claimed from either employer and not both. The same case applies to deduction of tax under Section 80C, which can be claimed only once.
Thus, the total deductions must be computed, keeping in mind the ceiling limits of the deductions, (Rs. 50,000/- for standard deduction and Rs. 1,50,000/- for deduction under Section 80C).
It is also important that from total taxes, the TDS deducted by both the employers must be subtracted and the balance must be paid as advance installments.
Support our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates.
A two-judge bench of the Supreme Court has upheld a High Court order wherein it was held that TDS is not leviable on the non-convertible debentures and fixed deposit of the value less than Rs.5,000/-, under the provisions of the Income Tax Act, 1961.
A bench comprising Justice M.R. Shah and Justice M.M. Sundresh was considering an issue regarding the chargeability of TDS on non-convertible debentures and FDR below Rs.5,000/-.
Upholding the High Court and the ITAT order, the Court observed that “having gone through the judgment and orders passed by the Tribunal as well as the High Court, we are of the opinion that no error has been committed by the Tribunal and/or the High Court on the chargeability of TDS amount on non-convertible debentures and fixed deposit of the value less than Rs.5,000/-. Both, the Tribunal as well as the High Court have concurrently found that on non-convertible debentures and fixed deposit of the value less than Rs.5,000/-, there shall not be any TDS leviable. We are in complete agreement with the view taken by the Tribunal as well as the High Court. Once, there is no liability to deduct TDS on non-convertible debentures and fixed deposit of the value less than Rs. 5,000/-, there is no question of charging any interest. However, at the same time the issue whether the levy of the interest was time barred considering Section 201(1) / 201(1)(a) of the Income Tax Act, 1961 has not been dealt with and considered in High Court, we keep the question of law on the aforesaid open.”
Advocates, Mr. Nishit Agrawal, AOR, Adv. Ashwani Garg, and Adv. Kanishka Mittal appeared for the assesee.
Subscribe Taxscan Premium to view the JudgmentSupport our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates.
The Delhi Metropolitan Magistrate (Negotiable Instruments) Court of Magistrate Divya Arora has recently held that the violation of Section 269SS of the Income Tax Act, 1961 does not disturb the proceedings under the Section 138 of Negotiable Instruments (NI) Act, 1881. In the case of Section 138 proceedings initiated against the accused, it was observed…
The Authority of Advance Ruling (AAR), Kerala has recently clarified that, The marine engine and its spare parts supplied for use in vessels falling under Customs Tariff Heading 8902 (Fishing Vessels) shall attract Goods and Services Tax (GST) at the rate of 5% [Central Goods and Services Tax (CGST) 2.5% and State Goods and Services Tax (SGST) 2.5%].
The applicant, M/s. Kerala State Co-operative Federation for Fisheries Development Limited (Matsyafed) applied to the AAR seeking clarification in the GST Rates applicable on marine engines of Heading 8407, being the part of fishing vessels of Heading 8902 and parts of the same.
The applicant has been paying Integrated Goods and Services Tax (IGST) at 28% at the time of import of marine engines and their parts hence charging and collecting the same on subsequent supply to the fishermen and paying the same to the Government.
Recently, in an application filed by M/s. South Indian Federation of Fishermen Societies, Trivandrum, the Authority of Advance Ruling, Kerala, held in Advance Ruling NO.KER/10/2021 dtd.25-05-2021 that marine engines and their spare parts supplied by them for fishing vessels of heading 8902 would attract a GST rate of 5% only. It was submitted by Matsyafed that the same shall be applied to their supplies also.
It was ruled that, “The marine engine and its spare parts supplied for use in vessels falling under Customs Tariff Heading 8902 shall attract GST at the rate of 5%”
Reasoning for the same was given as “[2.5% CGST + 2.5% SGST] as per entry at SI No. 252 of Schedule I of Notification No.01/2017 Central Tax (Rate) dated 28.06.2017” and it was clarified that “If it is supplied for use other than as parts of fishing vessels as stated above, GST at the rate applicable under the respective Customs Tariff Headings in which they are classified will apply.”
Subscribe Taxscan Premium to view the JudgmentSupport our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates.
The Goods and Services Tax (GST) portal has issued an Advisory dated October 25, 2022, on Filing TRAN forms for Taxpayers from Daman and Diu & Ladakh.
“Due to reorganization of the state of Jammu & Kashmir and merger of the Union territories of Dadra and Nagar Haveli and Daman and Diu, the taxpayers of Ladakh and earlier ‘Daman and Diu’ region have been allotted new GSTINs. There is therefore a doubt as to how to file the TRAN-1 and whether it would be linked with the old TRAN-1 or not,” the Portal said.
The aggrieved taxpayers of both the above-mentioned regions are hereby informed that they can file or revise their TRAN-1 or TRAN-2 Forms only through their newly allotted GSTINs. Kindly do not use the old GSTIN for filing of TRAN forms.
“The respective tax administrations of both regions are also advised to accordingly facilitate the taxpayers and keep the above information in mind while processing the TRAN claims under the new GSTINs by linking both the old and revised TRAN-1 forms filed by such taxpayers,” the Portal said.
Support our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates.
In a significant move, the Goods and Services Tax (GST) portal has asked taxpayers with up to Rs 5 crore turnover to report 4-digit HSN codes in their GSTR-1 from 1st November 2022.
As per Notification No. 78/2020 – Central Tax dated 15th October 2020, it is mandatory for the taxpayers to report a minimum 4 digit or 6-digit HSN Code in table-12 of GSTR-I on the basis of their Aggregate Annual Turnover (AATO) in the preceding Financial Year.
“To facilitate the taxpayers, these changes are being implemented in a phase-wise manner on GST Portal,” the portal said in an advisory to the taxpayers.
“Part I & Part II of Phase 1 have already been implemented from 01st April 2022 & 01st August 2022 respectively and are currently live on GST Portal. From 01st November 2022, Phase-2 would be implemented on GST Portal, and the taxpayers with up to Rs 5 crore turnover would be required to report 4-digit HSN codes in their GSTR-1,” the GSTN said.
Subscribe Taxscan Premium to view the JudgmentSupport our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates.
The Ahmedabad Bench of the Income Tax Appellate Tribunal(ITAT), in a recent ruling in favour of the Revenue has held that, the educational expenses incurred for the daughter of the assessee’s firm shall not be considered as incurred for purposes of business. The Tribunal comprising Annapurna Gupta and Suchitra R Kamble had identified the issue…
This weekly round-up analytically summarizes the key stories related to the Income Tax Appellate Tribunal (ITAT) reported at Taxscan.in during the previous week from October 8 to October 14, 2022 Microsoft Regional Sales Pte. Ltd vs Assistant Commissioner of Income tax – 2022 TAXSCAN (ITAT) 1388 In a relief to Microsoft, the Delhi bench of…
The Allahabad bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), held that the charge of Clandestine removal is to be framed only on the basis of substantial evidence in favour of the appellant-assessee, M/s Raghuveer Rolling Mills.
The counsel for the appellants contended that the entire case of the department based on the entries in a notebook recovered during the search. He submitted that however, the person, who allegedly have made entries in the said notebook has neither been identified nor his statements were recorded; the proprietor of the company was made to accept the clandestine removal and to deposit the amount towards duty. It was further submitted that clandestine removal cannot be alleged only on the basis of the statement but it has to be corroborated with tangible concrete evidence and not on the basis of wild inferences or assumptions and presumptions.
The revenue submitted in reply that, the impugned order has extensively analyzed the evidence submitted by the revenue and have upheld the charge of clandestine removal. Hence, the appeal is liable to be rejected.
The Appellate Tribunal found that, the case of the Department is that the appellants have indulged in clandestine removal.It was noted that the department came to this conclusion on the basis of entries made in a certain note book recovered from the appellant’s premises. Neither the author of the notebook or the credibility of the entries made in the notebook were verified by the Excise Department. Several infirmities were also found in the investigation and the show cause notice issued to the appellant as pointed out by the counsel for the appellant.
It was thus held by the Single Bench consisting P Anjani Kumar, Technical Member that, “In view of the above, I find that the department has not adduced any additional evidence, even on a sample basis to substantiate the allegation of clandestine removal as per above. In the absence of evidence, the allegations raised by the department are not substantiated. For this reason, impugned order cannot be sustained”, thereby quashing the order-in-original, demanding Rs. 11,11,790/- in penalties and interests and the order-in-appeal by the Commissioner (Appeals) that upheld the order-in-original.
Subscribe Taxscan Premium to view the JudgmentSupport our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates.
