The Rajasthan High Court has held that the mere skill will not fall within the activity of gambling or betting.
The PIL has been filed by the petitioner claiming himself to be a resident of Ajmer City, involved in the business of imparting education by way of coaching to the youth of Ajmer City.
The grievance raised in the present petition is in respect of the online game known as “Dream 11” and the said online game is alleged to be betting of the cricket team and amounting to gambling. The petitioner has submitted that public, in general, is cheated in the name of “Dream 11” game and people become the culprit of gambling and betting without having the proper knowledge of the law. The petitioner has submitted that by permitting “Dream 11” game to be played, the respondents are committing the offence of gambling and betting.
The division bench comprising of Chief Justice Inderjit Mahanty and Justice Ashok Kumar Gaur has pronounced the judgement on a Public Interest Litigation.
Section 12 of the Rajasthan Public Gambling Ordinance, 1949, the game involving “mere skill” is exempted from the applicability of the Act/Ordinance.
The division bench observed that only if the result of the game/contest is determined merely by chance or accident, any money put on the stake with the consciousness of risk and hope to gain would be ‘gambling’ or ‘betting’.
While relying upon decisions in Varun Gumber Vs. Union Territory of Chandigarh , and Division Bench of the Bombay High Court in the case of Gurdeep Singh Sachar Vs. Union of India & Ors. [Criminal Public Interest Litigation Stamp No.22 of 2019] the court came to the conclusion that the game “Dream 11” and it has been found that “Dream 11” game does not involve any commission of the offence of gambling and betting.
Subscribe Taxscan Premium to view the JudgmentThe Gujarat High Court has granted the Anticipatory Bail to accused of alleged misappropriation of files with GST Department.
In the case of Manmohan Lalman Agarwal vs. the State of Gujarat, the High Court has approved the application requesting the anticipatory bail to the applicant on the alleged charges of misappropriation of File No. IV/06-Prev/32/Gr.IV/2019-20 with Central GST and Central Excise, Vadodara-II, and this is the offence which is punishable under the provisions of Goods and Service Tax (GST) Act.
The applicants were accused of misappropriation of File No. IV/06-Prev/32/Gr.IV/2019-20 with Central GST and Central Excise, Vadodara-II, and this is the offence which is punishable under the provisions of Goods and Service Tax (GST) Act. Hence, the applicant filed the application requesting the High Court of Gujarat to grant the anticipatory bail to the applicant.
Therefore, the issue raised in this case was whether the application of the applicant pertaining to the anticipatory bail can be granted by the High Court of Gujarat or not?
The Single Bench of Justice A.Y. Kogje has granted the application requesting the anticipatory bail with GST to the applicant on the alleged charges of misappropriation of File No. IV/06-Prev/32/Gr.IV/2019-20 with Central GST and Central Excise, Vadodara-II, and this is the offence which is punishable under the provisions of Goods and Service Tax (GST) Act.
The Court was considered applicant number 1 was 69 years old and at the same time, he was suffering from medical ailments. Secondly, the applicant number 2 is a lady accused and is 65 years old and she is a partner just for the namesake. Further, the statement of both the applicant’s statements is recorded. Lastly, the public prosecutor failed to bring into the notice of the court any special circumstance against the applicant.
Subscribe Taxscan Premium to view the JudgmentThe Anti Evasion wing of CGST Delhi South Commissionerate has unmasked yet another case of fake invoicing and GST fraud of duping the exchequer. The investigators have busted a well-organized racket of creating bogus firms, issuing fake invoices and bogus e-way bills to generate and encash tax credits.
The main culprit was arrested on 19.02.2020 as per the provisions of section 69 of the CGST Act, 2017 and produced before Judicial Magistrate who remanded him to 14 days of judicial custody on 19.02.2020.
Incriminating electronic evidence was recovered from the premises of the accused. Over 35 entities that are involved in the bogus e-way bills transactions have come to notice, involving the fake invoicing value of Rs. 214.74 crores and resulting tax evasion of Rs. 38.05 crores in the form of Input Tax Credits
Further investigations in the matter are in progress.
The Central Board of Indirect Taxes and Customs (CBIC) has issued the advisory for opting in for Composition Filing Form GST-CMP-02.
Who can opt-in for Composition:
Eligible existing Registered taxpayers can opt-in for composition, for the financial year 2020-21, by filling up Form GST CMP-02. Your composition scheme shall be effective from 1st April 2020.
How to opt-in for Composition:
A registered taxpayer can apply for composition after login. The navigation to apply for composition is as given below:-
Who are eligible taxpayers:-
Those taxpayers can opt for Composition, who is a regular taxpayer with an aggregate annual domestic PAN-based turnover less than as specified from time to time as given below:
Who are not eligible taxpayers:-
Following taxpayers cannot opt for the Composition if they are involved in or making:-
Submission of Stock Intimation Details:
Taxpayers opting in for composition need to file stock intimation details click here.
Return /Payment:
All composition taxpayers are required to file Form GST CMP-08 quarterly (for details click here.
The Delhi High Court has denied Bail to Chartered Accountant Nitin Johari, Ex CFO of Bhushan Steel for committing an offence pertaining to the non-disclosure of the documents which are required under Indian Accounting Standards (IndAS).
The petitioner was not only the Chartered Accountant (CA) but also the Chief Financial Officer (CFO) and the whole time director of the company i.e. Bhushan Steel. Further, he was also the part of ‘Committee of Board of Directors on Borrowing, Investments and Loans’ and was a close associate of the assued and the petitioner aided the accused for the purpose of raising fund and further helped him in submitting the requests for credit facilities and also presentations were made to the lender banks. Further, the bail Chartered Accountant (CA) was well aware of the fact that BSL had not provided the required document disclosures and details as required under Indian Accounting Standards (IndAS).
Furthermore, various fraudulent methods were undertaken and a huge inflow and outflow of funds were ensured. On these charges, the Chartered Accountant (CA) was arrested.
Therefore the issue raised in this case was whether the Chartered Accountant (CA) can be given bail or not?
The Single Judge Bench of the High Court of Delhi held that the Nottin Johari cannot be granted bail as he has committed an offence pertaining to the non-disclosure of the documents which are required under Indian Accounting Standards (IndAS) based on the rationale that the alleged charges against the accused are very serious in nature and also involves fraud to the misappropriation of several crores of Rupees and this offence adversely affects the economy of the nation and hence the petitioner is not entitled to bail under Section 439 of Criminal Procedure Code (CrPC).
Subscribe Taxscan Premium to view the JudgmentThe Bangalore bench of the Income Tax Appellate Tribunal (ITAT), on Monday granted an extension of stay period to IT giants Google India citing a reason for the delay in non-disposal of appeal. The two-judge bench of the Tribunal noted that the delay was not due to the fault of the assessee and therefore, the stay period should be extended.
Earlier, the income tax department had made additions against the Company under three heads, i.e, the amount paid to the parent Company for distribution services under Adword Programmes was subject to TDS under Section 195 of the Income Tax Act. Further, an addition was made after determination of Arm’s Length Price (ALP) u/s.92 of the Act, in respect of international Transactions of rendering Google India IT services and IT-enabled Services and Marketing and Distribution services rendered by GIPL to its Associated Enterprises (AE). The third edition was made since the profits arising out of AdWords program attributable to Google Ireland are not offered to tax.
Originally, the stay was granted by the Tribunal last year and directed the assessee to pay an amount of Rs.475 Crores in four installments. However, the revenue challenged the above stay order passed by the Tribunal before the Hon’ble High Court of Karnataka, and Hon’ble High Court has reduced the payment in 3 installments and the assessee has duly complied with the directions of the Hon’ble High Court in paying the installments. Subsequently, the stay order was extended in S.P. Nos.238, 239 & 240/Bang/2019 Dt.9.8.2019 for a period of six months from the date of the order or till disposal of the appeal.
The case was posted for hearing on 6.11.2019 and 18.11.2019, but the appeal could not be heard due to paucity of time. Further on 8.1.2020, the appeal was adjourned by the Bench to 19.2.2020. Accordingly, the appeals are posted for hearing on 19.2.2020 and prayed for extension of stay.
Since the period of stay is over, the assessee pleaded before the Tribunal that the delay in non-disposal of appeal is not attributable to the assessee.
Allowing the contentions of the assessee, the Tribunal held that “We, considering the facts and circumstances and the stay petition filed by the assessee, hold that the delay in non-disposal of the appeal is not attributable to the assessee. Hence the balance of convenience lies in favor of the assessee for extending the stay as the assessee has complied with the directions of the Tribunal and the Hon’ble High Court in payment of installments. Accordingly, we extend the stay of outstanding demand for a further period of six months from the date of this order or disposal of the appeal whichever is earlier. We order accordingly.”
Subscribe Taxscan Premium to view the JudgmentThe Telangana High Court held that a calling for an income tax return by the court is not violative of the fundamental right i.e. the Right to Privacy under Article 21 of Part III of the Constitution of India. The rationale behind this is that the income tax returns is the government document and is accessible to the public at large.
The case was that is a suit the company sought a declaration that the property purchased in the name of the defendant was ‘Benami property’ because of the fact that the sale consideration was actually advanced by the company. The defendant, in this case, was the additional director of the company in whose name the Benami property was purchased. Later on, the defendant was removed from the directorship of the company, furthermore, he refused to return the property as he claimed that it was his property. And so the suit was filed. In the suit, the court summoned the income tax returns from the company. However, the company claimed that submission of the income tax return to the court will ve violative of its fundamental rights i.e. right to privacy under Article 21 of the Constitution of India.
The issue raised in this case was whether the summoning of the income tax return document is violative of right to privacy under Article 21 or not?
The High Court of Telangana in the light of the facts and the precedents stated held that the Income Tax Return is the government document and an income tax return called/summoned by the court does not violate the right to privacy under Article 21 of Part III of the Constitution of India.
Subscribe Taxscan Premium to view the JudgmentThe Customs Excise and Service Tax Appellate Tribunal ( CESTAT ), Chennai observed that the brand Nimbooz is not lemonade and allowed excise duty exemption.
The appellant is engaged in the manufacture of aerated water and beverages which are sold under the brand “Nimbooz” from March 2009 onwards.
The appellant since then has been classifying the goods under Chapter Sub-heading No. 2202 9020 of Central Excise Tariff Act, 1985 and thereby claiming full exemption under Sl. No. 24 of Notification No. 1/2011-CE dated 01.03.2011.
There are no disputes that the appellant has paid the duty at the rate of 1% ad velorem (without Cenvat Credit facility) along with Education Cess and Secondary and higher education cess as applicable and for the period 01.04.2012 to 31.03.2013 appellant had opted to pay duty on ‘’Nimbooz’’ at the rate of 6% ad velorem, without Cenvat Credit facility.
The Revenue, entertaining a doubt that the above “Nimbooz’’ manufactured and classified by the appellant did not fit into the general description under the Chapter sub-Heading for ‘’fruit pulp or fruit juice based drink is a packaged nimbu pani.
Hence is nothing but a ‘’Lemonade’’ which is classifiable under 2202 1020, issued a Show Cause Notice dated 18.03.2014 proposing reclassification as ‘’Lemonade’’ under Chapter sub-Heading 2202 1020 and thereby demanding duty for the period 01.03.2009 to 31.03.2013 along with applicable interest and penalty.
The appellant filed a detailed reply justifying its classification under 2202 9020, but the adjudicating authority, ie. Commissioner of Central Excise, Puducherry. however, confirmed the proposals as made in the SCN and thereby re-classified ‘’Nimbooz’’ as ‘’Lemonade’’ under Chapter sub-Heading 2202 1020. Aggrieved, the appellant-assessee has preferred this appeal.
The CESTAT bench comprising of Judicial Member, P. Dinesha and Technical Member, C.J.Mathew pronounced the order based on an appeal filed by Ms. Pepsico India Holdings Pvt. Ltd.
The bench observed that the product “Minute Maid Nimbu Fresh manufactured by Brindavan Beverages Private Limited, and 7up “Nimbooz Masala Soda” or 7up ‘’Nimbooz’’ manufactured by Pepsico India Holdings Private Limited are classifiable under Tariff Item 220-2 9020 of the Central Excise Tariff Schedule under the category of ‘’fruit pulp or fruit juice based drinks’’.
While allowing the appeal the appellate authority observed that the classification declared by the appellant under the Chapter sub-heading 2202 9020 is held to be correct and hence the Revenue is not justified in reclassifying ‘’Nimbooz’’ as Lemonade’’ under Chapter sub-Heading 2202 1020.
Subscribe Taxscan Premium to view the JudgmentThe Delhi bench of the Income Tax Appellate Tribunal (ITAT) has held that depreciation under section 32 of the Income Tax Act, 1961 is allowable in respect of the amount paid as a license fee to the Indian Railway.
The assessee Corporation is an Authority constituted under the law for the marketing of agricultural produce and derives the bulk of its income from the letting out of godowns or warehouse for storage and processing the marketing of commodities etc.
During the relevant assessment year, the income tax department rejected the claim of depreciation along with some other similar claims.
On the first appeal, the Commissioner of Income Tax (Appeals) held that the license/registration fee paid to Indian Railway is allowable as a deduction.
The authority relied on the decision of the Tribunal in the case of ONGC Videsh Ltd. wherein it was held that the right granted to the assessee by way of license whereunder the assessee had become owner of such right, such license enables the assessee to have an access to carry on their business and therefore, it falls within the category of an asset u/s. 32(1)(ii) of the Income Tax Act.
Concurring with the findings of the first appellate authority, the Tribunal observed that “no decision is brought to our notice to the contrary to take a different view. We, therefore, while agreeing with the ld. CIT(A), find that the claim of depreciation in respect of license/registration fee paid by the assessee to the Indian Railway is an asset whereon depreciation u/s. 32(1) is allowable.”
Subscribe Taxscan Premium to view the JudgmentIn the case of M/s Neva Plantation Private Ltd. vs. ACST-cum-Proper Officer North Enforcement Zone, Palampur, the Himachal Pradesh Appellate Authority has imposed the penalty as the taxpayer failed to cover all the documents i.e. Generate E-way Bill during the transportation of goods.
The appellant namely M/s Neva Plantation Private Ltd. which is a private company and is engaged in the plantation business. Further, the appellant sent one of the machines called “auto-clave” for the purpose of repairs to the M/s Pragati Laboratory Equipment and for this purpose, a challan was issued, wherein it was specifically mentioned that the goods are not for sale and only for repairs. It is pertinent to mention that the machine along with the conveyance was detained because of the non-availability of the E-way Bill, which is one of the most essential conditions for the transportation or conveyance of goods.
The issue raised in this case was whether the applicant is liable for the penalty on the failure of Generate E-way bill while transporting the goods for repair or not?
The Himachal Pradesh Appellate Authority comprising of Rohit Chauhan, Additional Commissioner State Taxes & Excise (Gr-I)-cum-Appellate Authority GST (Appeals), Himachal Pradesh held that taxpayer failed to cover all the documents i.e. E-way Bills during the transportation of goods and hence the taxpayer is liable for penalty under Section 129 of the Himachal Pradesh Goods and Service Tax (GST) and Central Goods and Service Tax (CGST) Act, 2019 as the consequence of the violation of Rule 138, further a demand of Rs. 1,18,800/- is raised against the taxpayer under Integrated Goods and Service Tax (IGST). The court set aside the order passed by ACST-cum-Proper Officer North Enforcement Zone, Palampur as the transportation of goods was only for reparation. However, a penalty of Rs. 10,000/- was imposed for not having an E-way Bill.
Subscribe Taxscan Premium to view the JudgmentIn a significant ruling, the Ahmedabad bench of the Income Tax Appellate Tribunal (ITAT) has imposed a penalty of Rs. 5000 on an assessee on the grounds of a delay of 358 days in filing appeal and non-co-operation with the income tax department during the assessment proceedings.
The assessee, who is an individual, took a defense that could not file the appeal due to change in the place of employment i.e. from Ahmedabad to Pune.
As per section 253(5) of the Act, the Tribunal is empowered to condone the delay if the appeal was not presented by the assessee within the time due to some unavoidable reason.
Regarding the contentions of the assessee, the Tribunal observed that the condonation petition was not supported with the corroborative evidence for shifting employment from Ahmedabad to Pune.
“We are not ignorant of the fact that the assessee should be penalized for the default committed by him for not presenting the appeal in time but in our considered view the penalty should be commensurate to the default committed by him. Thus, in the interest of justice and fair play, we impose the cost upon the assessee for Rs. 5000/- for not presenting the appeal within the prescribed time. Accordingly, the assessee is directed to deposit cost of Rs.5000/- in the Income Tax Office,” the Tribunal said.
Noting the fact that the assessee has not appeared before the authorities, the Tribunal added that “thus it is transpired that the impugned addition has been made and sustained without considering the relevant evidence which might result in the recovery of the taxes on the additions which are not sustainable in the eyes of Law. Indeed, the primary onus lies on the assessee to co-operate in the proceedings before the authorities below. In case he does not do so he deserves to be penalized. Again, we feel that the penalty to be imposed upon the assessee should be commensurate to the default committed by him. As such we are of the view that the assessee should not suffer for his nonappearance for the addition of the income which is not sustainable under the Act,” the Tribunal said.
“We are of the view that the assessee deserves to be penalized for non-appearance before the authorities below. Accordingly, we impose the penalty of Rs.5000/- upon the assessee to deposit the same in the Income Tax Officer before the commencement of his proceedings before the AO. We further direct the assessee to co-operate in the proceedings before the AO and furnish all the requisite documents in advance before him,” it added.
Subscribe Taxscan Premium to view the JudgmentThe Chhattisgarh High Court has upheld the validity of the rules issued by the Chhattisgarh State Government where it notified the authority of local authorities to collect fees from service providers or licensees who set up mobile towers.
A set of 20 Writ petitions including those filed by Reliance Infratel, Idea Cellular, Vodafone Essar, BSNL and other major firms in the telecom sector challenged the constitutional validity of the Chhattisgarh Municipal Corporation (Erection of Temporary Tower or Structure for Cellular Mobile Phone) Rules, 2010. These rules were issued by the State Government providing for the realization of the one-time permit fee, the yearly renewal fee and the compounding/settlement fee. The State government also issued a circular invoking the power of the Panchayat Raj, whereby the Gram Panchayats were set at liberty to realize the one-time permit fee in connection with the erection of the mobile towers in the panchayat area, with the annual renewal fee and also stipulating the compounding fee/settlement fee.
The main ground of challenge was that no power or authority was vested with the State to issue any Circulars/ Directions/ Rules as it was a subject coming under Entry No. 31 of List I of the Seventh Schedule of the Constitution of India, to which field there cannot be any intrusion by the State. The appellants also contended that one-time permit fees and the yearly renewal fees were exorbitant in nature.
Chief Justice PR Ramachandra Menon and Justice Prath Prateem Sahu while dismissing the petitions held, “. . . the mandate of Section 10 conferring power upon the Central Government / Telegraph Authority and the delegation of such power under Section 19B of the Act, 1885. The State Rules, 2010 issued by the State enables the Municipal Corporation / Municipalities to realize the one-time permit fee in respect of mobile towers, also providing for the renewal fees and the compounding fees. The basic challenge with reference to the absence of the power of the State because of the alleged absence of legislative authority stands already repelled. No tenable ground has been brought to the notice of this Court to draw any inference as to the ultra vires nature of the Rules and hence this challenge is also repelled.”
Subscribe Taxscan Premium to view the JudgmentThe Madras High Court has quashed an order by the Income-tax department where it has demanded tax on trade discounts received by dealers in the sale of Motor Car.
The petitioner Kun Motor Company Pvt. Ltd. is a dealer in both new and used cars based in Chennai. In respect of Assessment Year 2009-10, the Petitioner received Trade discount amounting to Rs.9,13,35,246.00 which was treated as value addition and proposed to be assessed to tax at the rate of 12.5%. which effected a tax of Rs. 1,14,16,906/-
The Counsel for the petitioner submitted that the same is not part of the taxable turnover of the cars sold by the petitioner. It was an incentive given by the manufacturer to the petitioner based on the performance of the petitioner on the sale of a car manufactured by the said manufacturer. He further stated that the said amount cannot form part of the taxable turnover of the petitioner in terms of Section 2(28) of the Income Tax Act and the definition of taxable turnover under Section 2(40 & 2(41) of the Tamil Nadu Value Added Tax (TNVAT), 2006.
Justice C. Saravanan while partly allowing the petition held, “. . . There is no dispute that the Petitioner is a Motor Car Dealers tax and had received trade discounts from the manufacturer from whom it had purchased the cars for retail sales at its showrooms. The trade discount which has been offered by the dealer is an incentive given by the manufacturer based on the performance of the Petitioner in the retail market. The trade discount offered by the manufacturer to the Petitioner does not in any manner enhance the taxable value of the motor cars sold by the Petitioner to the retail buyer at its showrooms. . . . The two transactions are independent transactions. One transaction is between the manufacturer who is also a dealer who had passed on incentives to the Petitioner and the second transaction between the Petitioner and the buyers of its retail showroom to whom the Petitioner has sold the cars. As these two are independent transactions there is no basis on which the trade discount passed to it by the manufacturer(dealer) to the Petitioner can be added into the taxable turnover of the Petitioner for the purpose of assessment under the TNVAT Act, 2006.”.
Subscribe Taxscan Premium to view the JudgmentThe National Anti-Profiteering Authority (NAA) has dismissed the profiteering allegations against the Xiaomi India.
In the complaint filed by M/s Local Circles India Pvt. Ltd. against M/s Xiaomi Technology India Pvt. Ltd., the National Anti-profiteering Authority (NAA) ordered that the supply of power-banks by Xiaomi is classified as ‘Lithium-ion Batteries’ and so 18% of Goods and Service Tax (GST) is applicable. The scope of the investigation is restricted to profiteering only and not the classification.
The M/s Xiaomi Technology India Pvt. Ltd. was engaged in selling power-bank, the Goods and Service Tax (GST) levied was at 18% before Jan 2019 and it continued to charge 18% of Goods and Service Tax (GST) even after Jan 2019 and thus it did not lead to any reduction in the rate of tax applicable to the power bank and as a consequence the price of the power bank has remained same.
The issue raised in this case was whether the Xiaomi violated any provision of Section 171 of the Central Goods and Service Tax (CGST) Act, 2017 or nor? If in case the Xiaomi has violated, then what will be the quantum of profiteering?
The NAA bench consisting of B.N. Sharma (Chairman), J.C. Chauhan and Amand Shah (Technical Member) held that power-bank did not come under the purview of the notification as it is described as the ‘Lithium-ion Batteries’ and the 18% of Goods and Service Tax (GST) levied is justified. Hence, in the present case in no aspect pertains to the case of profiteering. Therefore the scope of investigation or proceedings is limited to the issue of profiteering and not the issue of classification.
Subscribe Taxscan Premium to view the JudgmentThe Institute of Chartered Accountants of India (ICAI) has published a guide to Chartered Accountants to help them furnish CA certificates as per various provisions of the Good and Service Tax (GST). The GST and Indirect Taxes Committee has come up with this guide to GST certificates.
“In the Guide, an attempt has been made to cover each and every area in GST Law requiring the furnishing of CA Certificates. Further, checkpoints have been included for each Certificate which may be referred by the members before certifying the credential provided by the taxpayers.” – CA Prafulla P. Chhajad, President of ICAI was quoted in the forwarding of the guide.
The Guide can be downloaded here.
The Central Board of Indirect Taxes and Customs (CBIC) said that more than 90% of taxpayers have filed the GSTR-9 (Annual Return) and GSTR-9C (Reconciliation Statement) till 12th February 2020.
The GSTR 9 is an annual return form for all assesses (except composition scheme assesses) while GSTR 9C is an audit report to be submitted by assesses with an annual turnover of two crores or more.
The regular taxpayers who have an aggregate turnover of more than Rs 2 crore are mandated to file GSTR-9 and the other regular taxpayers who have aggregate turnover less than Rs 2 crore is optional. For filling of GSTR-9, filling of all due GSTR-1 and GSTR-3B is compulsory. The Taxpayers who have not filed GSTR-9 will not be able to file GSTR-9C.
The number of Taxpayers who are mandated to file GSTR-9 is 12.42 lakhs and out of these taxpayers who have filed GSTR-3B and GSTR 1 is 9.8 lakhs and out of 9.8 lakhs, the number of taxpayers who have filed GSTR-9 is 9.11 lakh and the number of taxpayers who have filed GSTR-9C is 8.42 lakhs.
Apart from these 32.92 lakhs taxpayers who are not mandated to file GSTR-9 have filed it. Similarly, apart from above, 1.04 lakhs taxpayers who are not mandated to file GSTR-9, have filed the same.
The Tax Bar Association and Others have filed a writ petition before the High Court of Rajasthan at Jodhpur, also claimed that many of its members could not access the portal and, even if they managed to furnish, they could not furnish the returns on time.
The government also is anticipating that with these changes and the due date extension, all taxpayers would comfortably be able to file their Annual Returns (GSTR-9) along with their Reconciliation Statement (GSTR-9C) for the financial year 2017-18 as well as 2018-19 in time.
The due date of filing returns for fiscal 2017- 2018 was extended in a staggered manner for various states until 12th February 2020.
The West Bengal Authority for Advance Ruling (AAR) held that the composite supply of crushing the food grains belonging to the State Government and delivery of the crushed grains will be exempted as provided the proportion of the packing materials in the composite supply in value terms does not exceed 25%.
The Applicant intends to supply to the State Government the service of crushing food grains. The Government will send to the Applicant the whole, unpolished food grain for processing. The Applicant will return the grain after crushing. The processed food grain will be used for distribution through the Public Distribution System (hereinafter PDS).
The Applicant seeks a ruling whether the above activity is exempt under Sl No. 3 or 3A of Notification No 1212017 CT (Rate) dated 2810612017 (corresponding State Notification No.1136 – FT dated 281OG12017), as amended (hereinafter collectively called the Exemption Notification). The question is admissible under section 97(2) (b) of the GST Act.
The Applicant is unregistered under the GST Act. Being unregistered, neither the Central nor the State tax administrations exercise ascertained administrative jurisdiction on the Applicant.
The bench comprising of two members Susmitha Bhattacharya and Parthasarathi Dey delivered the order based on a petition.
Section 98T (1) of the GST Act elaborates as these functions are in the nature of public welfare service that the governments on their own, and sometimes through governmental authorities/entities, do provide to the citizens. When the activity is in relation to any such function, the supply to the governments or governmental authorities/entities or local authorities is exempt from paying GST under Sl No. 3 or 34 of the Exemption Notification, provided it is either a pure service or a composite supply, where supply of goods does not constitute more than 25% of the value.
The Authority observed that the Service Tax exempts “services provided to the Government, a local authority or a governmental authority by way of water supply, public health, sanitation, conservancy, solid waste management or slum improvement and up-gradation.”
The bench further observed that the Applicant’s supply can be related to distribution through PDS, which is covered under Entry No. 28 of the Eleventh Schedule of the Constitution. lt will be an activity in relation to a function entrusted to a Panchayat under article 243G of the Constitution, and its supply to the State Government should be exempt under Sl No. 3A of the Exemption Notification, provided the proportion of the packing materials in the composite supply in value terms does not exceed 25%.
Subscribe Taxscan Premium to view the JudgmentThe Central Board of Direct Taxes (CBDT) has notified new additions to the methods and procedures followed by domestic companies for filing tax Under section 115BAA of the Income Tax Act, 1961.
These new tax rates were introduced by the Government of India through the Taxation (Amendment) Ordinance 2019 on the 20th of September 2019.
The new amendment as published in the official gazette states, “In the Income-tax Rules, 1962 (hereinafter referred to as the principal rules), after rule 21AD, the following rules shall be inserted, namely: –
“21AE. Exercise of option under sub-section (5) of section 115BAA.—
(1) The option to be exercised in accordance with the provisions of sub-section (5) of section 115BAA by a person, being a domestic companies, for any previous year relevant to the assessment year beginning on or after the 1st day of April 2020, shall be in Form No. 10-IC.
(2) The option in Form No. 10-IC shall be furnished electronically either under digital signature or electronic verification code.
(3) The Principal Director General of Income-tax (Systems) or the Director-General of Income-tax (Systems), as the case may be, shall-
In a mission to discourage people from destroying the animal habitat, Germany has proposed the imposition of tax on meat, egg, and dairy. As per the proposal, the meat will be taxed at 40 cents and milk, milk products and eggs at two cents per kilogram.
Germany is not the first to propose the idea of a meat tax. Lately, Denmark and Sweden have also been considering this.
The statistics say that billions of livestock are raised in factory farms, under cruel conditions. Other concerns supporting the proposal are that the consumption of the immense amount of food, water and energy and also the amount of methane produced. As per the UN report, it is high time that people switch to a more plant-based diet, both for the sake of earth as well one’s own health.
In opposition, many raised a concern that it would be a huge economic loss for the farmers. Another argument stated the impact the proposal will have on low-income communities. They will get denied a source of much-needed calories.
The additional revenue gathered will be spent on aiding farmers to cope with increased costs on running their farms.
As the climatic issues have to be urgently addressed and animal welfare has become a serious public issue, it is an idea worth considering.
The Income Tax Appellate Tribunal (ITAT) Ahmedabad has held that income received from Film Exhibition Business that has been leased out to another party should be treated as business income for taxation.
The assessee Deep Multiplexes Pvt. Ltd. is engaged in the business of film exhibition. It had filed its return of income on 19.9.2012 declaring a total loss of Rs.30,24,753/-. The Assessing Officer (AO) has noticed that though the assessee stated to be engaged in the business of film exhibition, no film exhibition business income activity was carried out. The source of its income was from leasing out multiplex to M/s.PVR Ltd., and M/s.Jubilant Food Works Ltd. In the year under consideration, the assessee has shown total receipts of Rs.1,09,61,877/- and profit before tax of Rs.34,03,249/-. According to the AO, since the lessees have deducted TDS under section 194I of the Act, the income it has earned was like rental income, the same was to be treated under the head “income from house property” but and not under “business income: as claimed by the assessee.
On Appeal The Commissioner of Income Tax (Appeals) found that assessee was, in fact, running multiplex, but due to the stoppage of its activity, premises along with machinery & furniture were given on lease to aforesaid ventures. These assets were reflected in the block of assets mentioned in the lease agreement. He observed that assessee has stopped its business activity, and given its properties on lease to the above parties. He, however, observed that since letting out of the property was inseparable from the letting out of the furniture & fixtures and plants & pieces of machinery, therefore, such rental income was to be taxable under the head “income from other sources” instead of “income from house property”
Vice President Rajpal Yadav while allowing the appeal held, “On an analysis of all these facts, in the light of authoritative pronouncements of Hon’ble Gujarat High Court as well as Hon’ble Supreme Court in the case of Excel Industries (supra), I find that there is no justifiable reason for the AO to deviate from view taken in earlier years, in this year. Neither the AO nor the ld.CIT(A) has pointed out what are the changes in the facts and circumstances from the earlier years. Even otherwise, if looked from angle of Revenue sharing from the operation of multiplex as well as other liabilities of the assessee, it would demonstrate that it was business exploitation by the assessee, and it has only given a portion of the complex for a period of ten years to PVR. Therefore, its income ought to be assessed under the head business income. I allow the appeal of the assessee and set aside the finding of both the Revenue authorities. The ld.AO shall assess the income of the assessee under the head ‘business income’.”
Subscribe Taxscan Premium to view the JudgmentThe Customs Excise and Service Tax Appellate Tribunal (CESTAT) held that the right to collect parking fees given by the mall owners is nothing but a consideration provided to the appellant by the mall owners.
The appellant is operating parking areas in five Malls by way of providing parking to the patrons/visitors of shopping malls and collecting parking fees for which they have appointed an outside agency for managing the parking area who is collecting “Parking Fees” on behalf of the appellants and remitting the proceeds to the appellant.
The third-party agency raises the invoice for operating cost and its management fee and charges Service tax on these amounts and pays the remaining amount of gross collection on monthly basis after deducting its direct operating cost and management fee.
The entire revenue generated by way of selling parking tickets belongs to the appellant. Parking income is recorded as revenue by the appellant in its books of accounts. The appellants claim that the income earned from parking fees belongs to appellants entirely and nothing is remitted to the mall owners from the collections made or otherwise.
The claim of the appellant that it has no written contract with the Mall owners and is not paying any amount by way of rent or space allocation or by whatever name it may be called to the Mall owners for operating the parking area.
The appellant asserts that the only interest of Mall owners is that there should be hassle-free parking and that the space available for parking should be utilized to the maximum possible extent so that there is adequate parking space for the vehicles, otherwise it will affect the popularity of the Mall and may cause traffic.
An audit of the appellant was conducted by the service tax department and on the basis of the audit, the above three show-cause notices were issued to the appellants alleging that the activity of the appellant amounted to management, maintenance or repairs‘ which was leviable to service tax as per the provisions of Finance Act, 1994.
The allegations made in the show cause notice were confirmed vide the impugned Order-in-Original against which the appellant is in appeal before the Tribunal.
The division bench constituting of President, Justice Dilip Gupta and Technical Member, C.L Mahar based on an appeal filed by M/s MGF Event Management.
SECTION 67. Valuation of taxable services for charging service tax. —
(1) Subject to the provisions of this Chapter, where service tax is chargeable on any taxable service with reference to its value, then such value shall, —
(i) in a case where the provision of service is for a consideration in money, be the gross amount charged by the service provider for such service provided or to be provided by him;
(ii) in a case where the provision of service is for a consideration not wholly or partly consisting of money, be such amount in money as, with the addition of service tax charged, is equivalent to the consideration;
(iii) in a case where the provision of service is for a consideration which is not ascertainable, be the amount as may be determined in the prescribed manner.
The bench has observed that the income shown in the balance sheet as parking fees will be considered as cum-tax value for determination of service tax and eligible to avail the Cenvat credit of the service tax paid on input services, which have been provided to the appellant by third party agency or any other service providers in providing the said service of management, maintenance, and repairs of the parking area.
The bench further stated that the right to collect parking fees given by the mall owners is nothing but a consideration provided to the appellant by the mall owners and the measure of such consideration is the gross income generated through the parking fees.
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