The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Chandigarh Bench held that the CESTAT’s Order allowing refund claims for Education Cess attained Finality as Revenue failed to Challenge before Higher Authority.
The Tribunal has passed the orders sanctioning the refund claim of the appellant, M/s Insecticides India Ltd. Instead of implementing the orders of this Tribunal, the authorities below passed the impugned orders rejecting the refund claim of the appellant.
As per the orders of this Tribunal, the refund claims of the appellants for education cess and higher education cess were allowed and it was also held in some of the cases that the refund claim/ self credit cannot be restricted in terms of Notification Nos. 19/2008-CE dt. 27.03.2008 and 34/2008-CE dt. 10.06.2008 and the appellants are entitled to claim the refund/self credit of duty paid through PLA in terms of Notification No. 56/2002-CE dt. 14.11.2002. Pursuant to the above orders passed by this Tribunal, the appellants approached the adjudicating authority for sanctioning the refund claim. The adjudicating authority partly sanctioned the refund claim and partly rejected the refund claim. The ld. Commissioner (Appeals) had gone through the orders of the adjudicating authority. Although the same was not challenged by the Revenue before the Commissioner (Appeals) but he sought the recovery of the refund claim earlier sanctioned by the adjudicating authority.
The appellants submitted that the orders passed by the Tribunal have never been challenged by the Revenue in appeal before the higher authority, therefore, the orders of this Tribunal have attained finality. Therefore, the authorities below are duty-bound to implement the orders of this Tribunal. The impugned orders are in gross violation of judicial discipline. Moreover, the Commissioner (Appeals) has sought the recovery of the refund claim partly sanctioned by the adjudicating authority, which is bad in law. The coram of Judicial Member, Ashok Jindal ruled that earlier orders of this Tribunal have been accepted by the Revenue and no appeal has been filed against those orders. In the absence of any challenge to the orders of this Tribunal, the adjudicating authority was duty-bound to implement the orders of this Tribunal which they failed to do so. Further, in the earlier round of litigation, the orders of this Tribunal were final.
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The Central Board of Indirect Taxes and Customs (CBIC) issued the instructions on the requirements for the import of tea from Nepal as “Darjeeling Tea”.
Darjeeling Tea is recognized for its unique flavor and qualities and has acquired a tremendous domestic and international reputation. The DoC is in receipt of various communications raising concerns regarding the import of tea from Nepal and the domestic sale of such imported teas as “Darjeeling Tea”, thereby adversely impacting the interests of the domestic Darjeeling Tea Planters.
“It is clarified that as per the Food Safety Standards (FSS) (Import) Regulations, 2017, clearance is required for import of food items into India. Further, the present trade treaty between India and Nepal allows mandatory sanitary and phytosanitary certificates, before products are allowed into each other’s country. As per the provisions of the Tea (Distribution & Export) Control Order, 2005, any importer importing tea from Nepal needs to have a license, as mandated under this order, and. should also have a clearance certificate issued by the Tea Council,” CBIC instructed.
The Board has requested that necessary action may accordingly be taken to ensure strict and mandatory compliance of the above mentioned FSS (Import) regulations and to also insist on a valid certificate issued by the Tea Board under the Tea (Distribution & Export) Control Order, 2005, besides the clearance certificate issued by the Tea Council of India, prior to allowing import of tea from Nepal.
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In a relief to Glenmark Pharmaceuticals Limited, the Sikkim High Court has held that the Claim of Budgetary Support under GST can not be rejected as it was made for a period prior to the registration.
The writ petitioner, Glenmark Pharmaceuticals Limited is engaged in the manufacture and supply of pharmaceutical products at their unit situated in Sikkim. They seek to challenge four orders passed by the Assistant Commissioner, Central Goods and Service Tax, Gangtok Division, Gangtok rejecting the four claims for budgetary support for four quarters filed by the petitioner.
The dispute in the present writ petition relates to the rejection of the petitioner’s claims for budgetary support under a “Scheme of Budgetary Support under Goods and Service Tax” regime on the ground that the claims were made for the period prior to the registration which is impermissible.
The division bench of Justice Bhaskar Raj Pradhan and Justice Meenakshi Madan Rai noted that although the application for registration and issuance of UID made by the petitioner had been received by the respondent on 12.12.2017, the authority neither registered the petitioner nor rejected the application compelling the petitioner to reapply for the same electronically pursuant to which registration and UID was granted on 31.10.2018. The fact that registration and UID were granted makes it evident that the petitioner was eligible for budgetary support under the scheme.
The bench said that the Respondent failed to process the application for registration as required. Since, the Respondent failed to grant the registration to the petitioner, although it was an eligible unit, the petitioner could not have made their claims for budgetary support before being allotted the UID. When the Respondent registered the petitioner and allotted the UID on 31.10.2018, just two days after, on 02.11.2018, the petitioner made all the four claims for the four quarters.
The court held that the impugned orders are liable to be set aside. It is accordingly ordered. As the respondents have rejected the claims of the petitioner on the technical ground as stated above it is directed that the authorities shall process the four claims made by the petitioner for budgetary support and sanction reimbursements as found eligible within three months from the date of this judgment.
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The Punjab and Haryana High Court directed the GST Dept. to grant appropriate time to Subway before forcing it to pay differential GST on Intellectual Property Rights (IPR).
The Subway has dragged the indirect tax department to court over allegedly forcing it to pay differential Goods and Services Tax on services before issuing any notices. It was further stated that the tax department had issued multiple summonses to top management over taxability of intellectual property rights.
“The tax department kept issuing summons without following the due process that could “traumatise” anyone. The Milford headquartered fast food company said that these summons were issued in spite of explaining to the tax authorities that an advance ruling application is pending,” the company said.
Advocate for the petitioner, Abhishek A Rastogi argued that investigation cannot be initiated when there is no case of tax evasion and that no recovery of demand can be done without issuance of a show cause notice and the speaking order.
“The recent trend is that numerous summonses are issued to top management and they are forced to pay a substantial amount even before issuance of any show cause notice or an order. In some cases, while application for Advance Ruling is pending for disposal, the tax authorities issue numerous summons without any breathing time to submit data/information and try to recover tax without issuance of the show cause notice,” said Rastogi.
The High Court held that appropriate time must be given to Subway to present the case. Subway has been asked to submit all facts, subsequent to which the authorities will pass a speaking order to decide on the issue.
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The Patna High Court quashed the order imposing interest on gross amount without deducting Input Tax Credit as it was passed without the issuance of Show Cause Notice.
The petitioner, M/s Laxmi Barter Private Limited has challenged the summary of an order issued in Form GST DRC-07 by the Assistant Commissioner, State-Tax, Patna Central Circle, Patna the Respondent under Section 75 of the GST Act whereby the interest has been imposed on gross amount without deducting the Input Tax Credit which is already paid by the petitioner and in utter violation of the principle of natural justice as the same was passed without the issuance of show cause notice in Form GST DRC-01A and GST DRC-01.
The division bench of Chief Justice Sanjay Karol and Justice S. Kumar held that the order is bad in law on the grounds that violation of principles of natural justice, i.e. Fair opportunity of hearing. No sufficient time was afforded to the petitioner to represent his case, and the order passed ex parte in nature, does not assign any sufficient reasons even decipherable from the record, as to how the officer could determine the amount due and payable by the assessee. The order, ex parte in nature, passed in violation of the principles of natural justice, entails civil consequences.
“Petitioner undertakes to deposit twenty percent of the amount of the demand raised before the Assessing Officer. This shall be done within four weeks. This deposit shall be without prejudice to the respective rights and contention of the parties and subject to the order passed by the Assessing Officer. However, if it is ultimately found that the petitioner’s deposit is in excess, the same shall be refunded within two months from the date of passing of the order,” the court said.
The court directed for de-freezing or de-attaching of the bank account of the writ-petitioner if attached in reference to the proceedings, subject matter of the present petition. This shall be done immediately.
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The Central Board of Direct Taxes (CBDT) notified the Haryana State Legal Services Authority eligible for Section 10(46) Income Tax Exemption.
The Board empowers under clause (46) of section 10 of the Income-tax Act, 1961 notified for the purposes of the Income Tax Exemption ‘Haryana State Legal Services Authority’ Panchkula an authority constituted by the State Government of Haryana, in respect of the g specified income arising to that Authority, namely Grants received from Central Authority i.e. National Legal Services Authority (NALSA) for the purposes of the Legal Service Authorities Act, 1987; Grants or donations received from the State Government of Haryana; Amount received under the orders of Courts; Fee received as recruitment application fees; and Interest income earned on deposits.
This notification shall be effective subject to the conditions that Haryana State Legal Services Authority, Panchkula, shall not engage in any commercial activity; activities and the nature of the specified income shall remain unchanged throughout the financial years; and shall file the return of income in accordance with the provision of clause (g) of sub-section (4C) of section 139 of the Income-tax Act, 1961.
This notification shall be deemed to have been applied for the financial year 2020-2021 and shall apply with respect to the financial years 2021-2022, 2022-2023, 2023-2024, and 2024-2025.
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The Central Board of Direct Taxes (CBDT) notifies Form No. 52A regarding Statement to be furnished to the Assessing Officer in respect of production of a cinematograph film.
The Board empowered under section 285B read with section 295 of the Income-tax Act, 1961 has notified Income-tax (32nd Amendment), Rules, 2021 which seeks to further amend Income-tax Rules,1962.
In the Income-tax Rules, 1962, in Appendix II, for Form No. 52A shall be substituted, which is in respect of Statement to be furnished to the Assessing Officer under section 285B of the Income-tax Act, 1961, in respect of production of a cinematograph film.
The Form No. 52A consists of the Name and address of the producer, Relevant previous year, Details of the film, Date on which the production of the film was started, If the production of the film has been completed, the date of completion, Financial year to which the statement relates, Details of payments of over Rs. 50,000 in the aggregate made by the producer or due from him to each person engaged in the production of the film as an employee or otherwise including Details of the person to whom payment has been made or is due and verification.
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The Customs Authority of Advance Ruling (AAR) ruled that the concessional rate of basic customs duty of 7.5% payable on smart plugs.
The applicant, M/s. Amazon Seller Services Private Limited proposes to import a device called smart plug, having model no. C2YY3N.
The application of advance ruling, seeking the classification of the said device and eligibility for the benefit of serial number 490 of notification no. 50/2017-Cus., dated 30.06.2017 was received in the secretariat of the erstwhile Authority for Advance Rulings (Central Excise, Customs and Service Tax), New Delhi on 17.08.2020.
However, since no ruling was issued by the said authority, the pending application was transferred to the Customs Authority for Advance Rulings, Mumbai in February, 2021. Communications were sent to the applicant from the secretariat of the CAAR, Mumbai to inform whether they are still desirous of receiving the advance rulings in respect of the pending application. The applicant, vide their communication informed that they are still interested in receiving the advance rulings and also that they will submit the application in the revised format in due course. Thereafter, the application was e-mailed by the applicant in July, 2021, which was followed by physical submission of the application in August, 2021.
The smart plug is described by the applicant as a handsfree Alexa enabled device that has multiple built-in elements, i.e., a plug, a socket, a switch and a button. The smart plug can be plugged into standard wall sockets. On the other side of it, a normal plug can be plugged into the smart plug. Such normal plug can be for any appliance like a table fan or a table lamp or refrigerator or any other connected appliance. It supports Wi-fi and Bluetooth connectivity. With such connectivity, the smart plug acts in its capacity as a smart switch_ The smart plug gets paired with the Alexa application on the user’s phone. After such pairing, the user can control the flow of electricity to the connected appliances through the smart plug using the Alexa application on his phone, without having to manually reach for the switch. The button on the smart plug enables its users to reset it to manual set up mode or factory setting or to change the network. The user gets a clear, visual indication from the LED that the smart plug has successfully reverted back to the manufacturer’s default state.
The coram of Manoj Kumar Hessa ruled that Smart plugs of model no. C2YY3N are rightly classifiable under sub-heading 85371000 of the first schedule to the Customs Tariff Act, 1975. The said smart plugs would be eligible to claim the benefit of serial number 490 of notification no. 50/2017-Cus., dated 30.06.2017.
“The relevant entry in the said notification provides for a concessional rate of basic customs duty of 7.5% for all goods other than those suitable for use in, motor vehicles falling under heading 8702 or 8704, motor cars falling under heading 8703, or motorcycles falling under heading 8711. Since smart plugs have been held classifiable under heading 8537 and do not fall under listed exclusions, they would be eligible for the concessional rate of duty under the said notification,” the AAR observed.
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The Institute of Chartered Accountants of India (ICAI) announced the Region-wise List of Members who have exercised option under under Rule 5 of the Chartered Accountants (Election to the Council) Rules, 2006 – i.e. Change of Polling Booth within the Region.
In pursuance to Rule 5 of the Chartered Accountants (Election to the Council) Rules, 2006, members were given option to vote from a particular polling booth within their Region. The list of members who have been permitted to vote at a polling booth of their choice within their own Regional Constituency is published for general information of the candidates for election to the Council and Regional Councils and such voters. The region-wise list of such members along with the details of the new Polling Booth is available on the website of the Institute under “ELECTION – 2021”. The list can also be viewed and downloaded from links namely Western Region – Option within Region, Southern Region – Option within Region, Eastern Region – Option within Region, Central Region – Option within Region, and Northern Region – Option within Region
For More Details Click Here
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The Gujarat High Court while allowing the Income Tax Refund to Pilot of Kingfisher Airlines held that Mere deduction of TDS does not close the chapter of tax liability unless deposited in Government treasury.
The petitioner, Kartik Vijaysinh Sonavane who is a pilot by profession and was an employee of M/s. Kingfisher Airlines. The Kingfisher Airlines deducted the Tax Deducted at Source to the tune of Rs. 7,20,100/- for the Assessment Year 2009-10 and Rs. 8,70,757/- for the Assessment Year 2011-12 in the case of the petitioner. The amount since had not been deposited by the Airlines in the Central Government Account, the credit when claimed by the petitioner, the same was obviously not given by the respondent and the demand had been raised with interest.
The petitioner had filed the return of income for the assessment years 2009-10 and 2011-12 and he claimed the TDS of Rs. 7,20,100/- and Rs. 8,70,757/- respectively as the tax paid in advance.
According to the respondent, it was the duty of the petitioner to join the necessary parties i.e. the Kingfisher Airlines as according to the petitioner, the employer has deducted the TDS and not deposited it to the government. There is a gross delay and latches in preferring the petition since the TDS was deducted during the financial years 2008-09 and 2010-11 and it was urged that the petition is not to be sustained.
The division bench of Justice Sonia Gokani and Justice Nisha M. Thakore held that the department is precluded from denying the benefit of the tax deducted at source by the employer during the relevant financial years to the petitioner.
“The credit of the tax shall be given to the petitioner and if in the interregnum any recovery or adjustment is made by the respondent, the petitioner shall be entitled to the refund of the same, with the statutory interest, within eight (8) weeks from the date of receipt of copy of this order,” the bench ruled.
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The Institute of Chartered Accountants of India (ICAI) has submitted the Pre-Budget Memorandum, 2022.
The Institute has suggested that the provisions of Section 2(1B) of the Income Tax Act be amended to clarify that the shares are to be issued by the amalgamated company to the shareholders of amalgamating company as they exist on the effective date and not on the appointed date.
Further, it is suggested that Life Insurance Policies (LIP) be treated as a capital asset falling within the definition of “property” under section 2(14) of the Act. Indexation benefit (for premiums paid) will take care of inflationary impact – resulting in parity with other capital assets.
It is suggested that section 2(19AA) may be amended to include in the definition of demerger, the corporate divestiture in form of spin-off under which a parent company transfers its shareholding in a subsidiary to its shareholders. Further, to ensure that distribution by the holding company to its shareholders of the shares of the subsidiary is not taxable as dividend, an exclusion also needs to be made for such distribution in case of Spin off from definition of dividend under section 2(22). Initially such an inclusion would be made only in respect of the parent company being a listed company.
“A tax consolidation scheme may also be adopted in India. This would create a positive impact on business with significant reduction of compliance and litigation cost,” the ICAI added.
Commercial banks may be instructed by proper authority, not to deduct TDS on NRO account earning interest upto INR 10,000 per annum.
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The Central Government has proposed to present a Cryptocurrency and Regulation of Official Digital Currency Bill, 2021 in the upcoming Winter Session of Parliament to create the official digital currency to be issued by the Reserve Bank of India (RBI).
The Bill also seeks to create a facilitative framework for creation of the official digital currency to be issued by the Reserve Bank of India.
The currency has the backing of the sovereign. It can be regulated at every level. In case of cryptos getting the status of currency, the problem remains, who will provide the guarantee.
The government was averse to cryptocurrencies being treated as a currency, as currency notes and coins are backed by statute and regulated by the RBI in consultation with the government.
“When the consistent stand of RBI is that they have not banned Virtual Currencies and when the Government of India is unable to take a call despite several committees coming up with several proposals including two draft bills, both of which advocated exactly opposite positions, it is not possible for us to hold that the impugned measure is proportionate,” the Apex Court while quashing an RBI notification preventing regulated entities from dealing in virtual currencies. It was of the opinion that curbs were disproportionate.
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The Supreme Court to hear the PIL challenging pattern and mode of the Intermediate and Final Cost Accountants (CMA) Examination
The Institute of Cost Accountants of India (ICMAI) will conduct the CMA intermediate and final exams, in online mode, from December 8 to December 15. Two cycles of CMA exams—June 2021 and December 2021—will be held together for syllabus 2016.
The petitioner, through Advocate Arup Banerjee, has sought to quash the Intermediate and Final exam 2021 as unconstitutional, null, And void as it violates Articles 14, 19, and 21 of the Constitution.
The petitioners contended that the institute has been changing the pattern suo moto, without sharing any official notification in their official sites regarding changes in exams pattern. Moreover, the Institute has changed the said exam pattern thrice in the last month which creates a lot of confusion and chaos in the minds of the candidates or students.
“The latest pattern or exam mode which is issued by the Institute is not at all feasible as per the study material released by the Institute,” the PIL added.
Practical problems such as theory papers that have long answers as per the latest pattern will not be possible within the given time. The time limit fixed by the Institute is 3 hours, which would make it impossible for students to complete the exam as most of the candidates are well versed and practiced in writing upon pen and paper.
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The Madras High Court directed the GST Authority to allow filing of revised Form TRAN-1 by opening the GST portal as Benefit of Input Tax Credit (ITC) cannot be frustrated on grounds of technicalities.
The respondent, M/s.Bharat Electronics Limited had lodged a claim for Input Tax / CENVAT Credit by filing form TRAN-1, admittedly, within time and disclosed a credit of Rs.14,97,28,201/- as Balance Credit in Column 5(a) of form TRAN-1, while showing a sum of Rs.80,98,936/- in Column 6 of form TRAN-I, though the respondent ought to have disclosed the sum of Rs.14,97,28,201/- in Column 6 of form TRAN-1 as well, on an erroneous / mis-construction as to the purpose of the said column in form TRAN-1.
The Input Tax / CENVAT Credit was available under the existing / prior indirect Tax laws such as VAT, Entry tax and Central Excise and Service Tax, both the State and Union intended to provide a mechanism for transition of credit that was legitimately earned and remained unutilised under various fiscal laws existing at the time of introduction of GST. With this avowed objective, the GST law permitted the registered / taxable persons under GST law to transition the credit that was earned and lying to the credit of such registered / Taxable person under the existing / prior laws to GST.
The division bench of Justice Pushpa Sathyanarayan and Justice Mohammed Shafiq ruled that if there is substantial compliance, denial of benefit of Input Tax Credit which is a beneficial scheme and framed with the larger public interest of bringing down the cascading effect of multiple taxes ought not to be frustrated on the ground of technicalities.
In view of the above, the court affirm the order of the Single Judge in directing the petitioner to enable the respondent herein to file a revised Form TRAN-1, by opening of the portal and that such exercise is to be completed within a period of 8 weeks from the date of issue this order.
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The Hyderabad Bench of Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) quashed the penalty as no demand was made in Show Cause Notice for alleged wrongful availment of CENVAT credit.
The appellant/assessee, M/s Nava Bharat Ventures Limited manufactures Ferro-Manganese and Silico-Manganese classifiable under Chapter 72 of Central Excise Tariff and pays Central Excise Duty. It has a captive power plant and part of the electricity generated is used in the manufacture of the final products and part is wheeled out to A.P. Transco, Subhash Kabini Power Corp. Ltd., Reliance Energy Trading Limited, A.P. Power Purchase Co-ordination Committee, etc. To the extent that electricity is captively used in the manufacture of final products, there is no dispute. The dispute is regarding the CENVAT Credit availed on the inputs and input services used in the production of electricity to the extent it is wheeled out.
The assessee reversed the proportionate amount of CENVAT Credit attributable to the inputs/input services to the electricity which is wheeled out. However, while calculating this proportionate amount of CENVAT credit, the credit on the input services mentioned in Rule 6(5) of CCR was not taken into account and no proportionate reversal was done on such input services. The show-cause notice demanded an amount equal to 8%/10% of the value of the electricity that was wheeled out under Rule 6(3A) of CCR. In the impugned order, the adjudicating authority accepted the proportionate reversal and therefore, did not confirm the demand in the show cause notice of 8% or 10% of the assessable value. However, the input services under Rule 6(5) while calculating the amount to be reversed was not excluded and hence the amount confirmed is higher than as per the assessee‘s calculations.
The adjudicating authority also imposed a penalty on the appellant. Assessee is aggrieved both by the calculation in the impugned order without excluding the credit of input services under Rule 6(5) and also by the imposition of penalty. Revenue is aggrieved by the fact that the adjudicating authority allowed proportionate reversal which is permissible subject to some conditions which, according to the Revenue, have not been fulfilled by the assessee and hence the Commissioner should have confirmed the entire amount of demand as per the show cause notice.
The coram headed by President Justice Dilip Gupta and Technical Member, P.V. Subba Rao held that Rule 15 provides for the imposition of a penalty if CENVAT credit has been wrongly availed which allegation must be made in the show cause notice with a proposal to recover such wrongly availed CENVAT credit under Rule 14 but such a demand has not been made. Instead, a demand of an amount equal to 8%/ 10% of the exempted goods under Rule 6(3) has been made in the show cause notice, which is only an option to the assessee and cannot be demanded under Rule 14. Since the show cause notice itself has been issued without authority of law, any penalty imposed in the impugned order in pursuance of it needs to be set aside too.
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The Telangana High Court remitted the matter to the Central Tax Commissioner as no definite view can be taken and Show Cause Notice was beyond the period of limitation.
The Petitioner, Aleem Miah Works is a works contractor, carrying out such contract works with the Governmental authorities, like construction of buildings, roads, etc. According to the petitioner, all such works are indivisible composite work contracts and therefore, do not attract service tax. That apart, the Government of India has issued notifications from time to time exempting such services provided to the Governmental authorities from payment of service tax.
On the basis of information received from the Income Tax Department, the respondent has prima facie taken a view that petitioner had rendered certain taxable services and declared the value of the services in its return of income under the Income Tax Act, 1961, but as the service provider had not paid any service tax, the same has resulted in non-payment of service tax. It is in such circumstances, that the impugned show cause notice has been issued.
The petitioner submitted that the show cause notice has been issued under sub-section (1) of Section 73 of the Act. According to him, the limitation for issuing show cause notice is thirty days, which period had admittedly expired long back. Of course, under the proviso, for the reasons mentioned therein, the limitation period for issuance of show cause notice in a case where service tax not levied; or paid, or short levied, or short paid, or erroneously refunded, stands extended to five years.
The two aspects i.e., whether the petitioner had provided services to only Governmental authorities, and not others, and even if provided to Governmental authorities, whether the contracts were indivisible, or composite, and secondly whether the extended period of limitation as per the proviso to sub-section (1) of Section 73 of the Act, would be applicable or not, would depend upon the factual examination and adjudication by the adjudicating authority.
The division bench of Justice Ujjal Bhuyan and Justice Chillakur Sumalatha held that to pre-empt the adjudicating authority from carrying out the said exercise at the threshold would not be justified.
“From a reading of the show cause notice dated 18.10.2021, no definite view can be taken at this stage, that the said notice is beyond the period of limitation in terms of the proviso to sub-section (1) of Section 73. These are matters for examination and adjudication by the primary authority. In the circumstances we are of the view that it would be in the interest of justice if the petitioner is relegated to the forum of adjudication before the respondent,” the court said.
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The President Institute of Chartered Accountants of India (ICAI), CA Nihar N. Jambusaria while addressing its Members regarding the latest developments related to the CA Profession informed that the ICAI is in talks with RBI for a hike in Audit Fees which is stagnant for 10 Years.
The ICAI President along with the Chairman and Vice-Chairman of the Professional Development Committee met the Governor of RBI, Shakti Kanta Das discuss the matters related to the rise in Audit Fees which is stagnant for the last 10 Years although inflation, cost of conducting audits, and reporting requirements have increased many folds. The RBI Governor has appreciated the need for fee rise and promised quick action.
The ICAI President stated that the matters related to audit quality, capacity building of members, and allotments of the audit were discussed at length.
After the onslaught of COVID-19 in 2020, the situation has started becoming normal so the ICAI has decided to organize an International Conference on ‘Accountants Creating a Digital and Sustainable Economy’ on the 21st and 22nd of January 2022 in Mumbai. The ICAI President urged the members and people to attend the conference in large numbers.
“We have formed a group to strengthen the ICAI’s role as a Consultative Body in the emerging regulations, laws, and topics of corporate and economic interest,” the CA Nihar N. Jambusaria added.
“Annual Budget Excise is the key government activity in which ICAI has been participating for many decades with success. We have submitted our pre-budget memorandum to the government. Last month we had a meeting with the Revenue Secretary to discuss various important suggestions related to the Union Budget, the President added.
The ICAI President urged the members to cast their valuable vote on the 3rd or 4th of December 2021 for the elections to the Central and Regional Council.
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The Tamil Nadu Authority of Advance Ruling (AAR) ruled that no GST concessional rates are applicable to activities of manufacture, supply of Fortified Rice Kernels till September 30, 2021.
The Applicant, Rasi Nutri Foods is engaged in the business of manufacture and supply of nutrition products such as complementary weaning food, energy food, fortified rice kernel, etc., and is also engaged in the trading of agricultural commodities. The Government of Tamil Nadu had invited tenders from eligible bidders for the supply of 164 MTs of Fortified Rice Kernels (FRK) per month with a content of 3 micronutrients namely Iron, Folic Acid, and Vitamin 1312. to Trichy District of Tamil Nadu (for issue under public distribution system), vide E-Tender Document dated 11.05.2020. Subsequently, the Applicant has been awarded the contract for the supply of FRK. In terms of the tender document, the successful bidder has to supply 164 MTs of RK to make Fortified Rice at the designated Rice Miller’s locations as per the technical specifications mentioned in the tender document, for a period of 2 years.
The Applicant is supplying the FRK to the Tamil Nadu Civil Supplies Corporation TNCSC) and raises invoices on the TNCSC whereby 5% GST (2.5% CGST 2.5% SGST) bes been charged; subject to the condition that the TNCSC submits the Certificate as mandated in Notification 39/2017-CT(R) dated 18.10.2017 read with G.O.Ms.No. 140 dated 17.10.2017 issued by the Commercial Taxes and Registration Department, failing which 18% GST (9% CGST 9% SGST) shall be applicable.
The applicant has sought the advance ruling on the issue of Whether Notification No.39/2017 CT(R) dated 18.10.2017 read with G.O.Ms.No. 140 dated 17.10.2017 issued by the Commercial Taxes and Registration Department, would be applicable to the Applicant’s activity of manufacture and supply of Fortified Rice Kernels to the Tamil Nadu Civil Supplies Corporation pursuant to the Pilot Scheme on “Fortification of Rice & its Distribution under the Public Distribution System” project launched by the Central Government.
The coram of Members K.Latha and T.V.Venkatesh held that FRK is not directly supplied to the economically weaker sections, but only after blending with rice grains in designated rice mills. The Notification No. 39/2017-C.T.(Rate) dated 18.10.2017 provided the concessional rate to Food Preparation’ subject to fulfillment of conditions at Column (4) before such amendment. Therefore in our view, the concessional rate under Notification No.39/2017 C.T. (Rate) for the Period 18.10.2017 to 30.09.2021 is not available to the applicant for reasons, that FRK is not a food preparation put up in unit containers for free distribution to economically weaker sections and Applicants are not involved in free distribution of FRK to Economically weaker sections.
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The Institute of Chartered Accountants of India (ICAI) has announced the Region-wise List of Members who have been permitted to vote from a city outside their region under rule 6; and (Part A) and to vote by post pursuant to the Announcement dated 31st August 2021 [i.e. Members eligible to vote at a polling booth in India but have gone abroad and are unable to return to India due to Covid-19) restrictions (Part B).
In pursuance to sub-rule 2 of Rule 6 of the Chartered Accountants (Election to the Council) Rules, 2006, applications received from the members to vote from a city that is outside their regional constituency were considered. The region-wise list (Part A) of members who have been permitted to vote from other regions is available on the website of the Institute under “ELECTION – 2021”.
This list (Part B) also contains the details of members who have been permitted to vote by post pursuant to the Announcement dated 31st August 2021 i.e. members eligible to vote by-poll in India but have gone abroad and are unable to return to India due to Covid-19 restrictions.
The region-wise list (Part A and Part B) can also be viewed and downloaded from the links namely Western Region, Southern Region, Eastern Region, Central Region, and Northern Region.
The lists are published for the information of all candidates and voters concerned. Such voters can view their Polling Booth details by visiting the link https://appforms.icai.org/elections/knowyourbooth2021.html (know you polling booth link).
The List of Voters who have been permitted to vote from another polling city/booths within their own Regional Constituency, in terms of Rule 5 of the aforesaid Rules, is being published separately.
For more details click here.
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The Central Board of Indirect Taxes and Customs (CBIC) has notified the withdrawal of the 12% GST rate for government contracts and the applicable rate of GST will be 18% from January 1, 2022.
In exercise of the powers conferred by sub-section (1), sub-section (3), and sub-section (4) of section 9, sub-section (1) of section 11, sub-section (5) of section 15, sub-section (1) of section 16, and section 148 of the Central Goods and Services Tax Act. 2017 (12 of 2017), the Central Government, on being satisfied that it is necessary for the public interest so to do, on the recommendations of the Council, further amends the notification of the Government of India, in the Ministry of Finance (Department of Revenue) No.11/2017- Central Tax (Rate), dated the 28th June 2017.
In the said notification, in the TABLE against serial number 3 in column (3), in the heading “Description of Service”, in items (1).(vik(ix) and (x), for the words “Union territory, a local authority, a Governmental Authority or a Government Entity” the words “Union territory or a local authority shall be substituted. In column (3), in the heading “Description of Service”, in item (vii), for the words “Union territory, local authority, a Governmental Authority or a Government Entity” the words Union territory or a local authority” shall be substituted; in column (5), in the heading “Condition”, the entries against items ((vi),(vii).fix) and (x) shall be omitted.
Against serial number 26, in column (3), in the heading “Description of Service”, in item (1), in clause after the words, numbers, figures and brackets “Customs Tariff Act, 1975, the words “except services by way of dyeing or printing of the said textile and textile products” shall be inserted.
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The Central Electricity Regulatory Commission (CERC) held that Mahindra Renewables are eligible to be compensated for an increase in capital cost due to the introduction of GST.
The Petitioner, Mahindra Renewables Private Limited is a generating company and has been declared a successful bidder for the development of one unit of 250 MW capacity of the 750MW solar project in Rewa District in the State of Madhya Pradesh. M.P. Power Management Company Limited (MPPMCL) is the holding company for all the distribution licensees in the State of Madhya Pradesh with whom the Petitioner has executed a Power Purchase Agreement (PPA) for off- taking approximately 78% of the power generated by the Project Unit.
The Government of Madhya Pradesh and the Government of India decided to set up the Rewa Solar Project, supported by the Solar Park Scheme issued by MNRE on 12.12.2014 for the Development of Solar Parks and Ultra Mega Units. Madhya Pradesh Urja Vikas Nigam Limited (MPUVN) and Solar Energy Corporation of India (SECI) incorporated a joint venture company namely Rewa Ultra Mega Solar Limited (RUMSL) with equal shareholding. MNRE designated RUMSL as the solar project developer/ bid process coordinator for the Rewa Solar Project consists of three units (i.e. Unit 1, Unit 2, and Unit 3) of ground-mounted grid-connected solar photovoltaic power plants of 250 MW capacity each and the energy generated from all the three units would be supplied to MPPMCL and DMRC.
The coram of P. K. Pujari (Chairperson), I. S. Jha (Member), Arun Goyal (Member), and P. K. Singh (Member) held that the Petitioner is directed to make available to the Respondents all relevant documents exhibiting clear and one to one correlation between the projects and the supply of goods or services, duly supported by relevant invoices and Auditor’s Certificate with respect to claims (subject to threshold limit). The Respondents are further directed to reconcile the claims for Change in Law on receipt of the relevant documents and pay the amount (subject to threshold limit) so claimed to the Petitioner. The quantum of compensation on account of the introduction of GST Laws w.e.f. 01.07.2017 should be discharged by the Respondents within 60 days from the date of issue of this Order or from the date of submission of claims by the Petitioner, whichever is later, failing which it shall attract late payment surcharge at the rates provided for in the PPAs. Alternatively, the Petitioner and the Respondents may mutually agree to a mechanism for the payment of such compensation on an annuity basis spread over a period not exceeding the duration of the PPAs as a percentage of the tariff agreed in the PPAs.
“The prayer of Petitioner to grant GST on the O&M expenses is not allowed. Since the PPAs in the instant Petition do not have a provision dealing with restitution principle of restoration to the same economic position, we hold that the claim regarding ‘carrying cost’ is not admissible,” the CERC said.
The commission held that that invoices raised up to COD pertaining to the supply of goods can be claimed under Change in Law on account of the GST Laws since the liability of Respondents for payment of the purchase of the power from the Petitioner starts from the Commercial Operation Date (COD). There is a possibility of a few services related to goods procured up to COD, to be completed on the last date of COD. Hence, in the case of ‘supply of services related to goods procured up to COD completed on the last day of COD, the invoices can be raised within 30 days after COD. Thus, in case of a supply of services related to goods procured up to COD, the invoices are to be raised within 30 days of supply of such services, which cannot be later than the 30th day of COD, and the Petitioner is entitled to be compensated accordingly.
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