The Calcutta High Court upheld the order treating the assessee as “Resident” for having stayed in India for 182 days, brought the entire salary under global income.
The petitioner, Tapas Kumar Basak has challenged the impugned order of the Director of Income Tax (International Taxation), Kolkata (respondent) passed under Section 264 of the Income Tax Act, 1961 which arises out of the assessment order passed under Section 147 or 144 of the Income Tax Act, 1961 treating the assessee/petitioner as “Resident” for having stayed in India for 182 days during the relevant previous year as per Section 6 (1) (a) of the Act and the Assessing Officer brought the entire salary of the petitioner amount to Rs. 12,26,822/- under the tax net as the global income of the resident as taxable while it is the claim of the petitioner that it is not taxable by taking the ground that during the financial year relevant to the assessment year 2004-05 he was on foreign water for a total period of 184 days and his residential status should have been taken as “Non-Resident” and salary received by him should have been treated as exempted by relying on Circular no. 586 of the CBDT dated 28th November, 1990 which is calculable for the crew members.
The single judge bench of Justice Md. Nizamuddin clarified that circulars/notifications upon which petitioner wants to rely is in conflict with Section 6 (1) of the Income Tax Act, 1961 and it is settled principle of law that if there is a conflict between a circular or notification and an Act the Act will prevail.
“I am not inclined to interfere with the impugned order of the respondent Commissioner of Income Tax dated 25th January, 2007 passed in exercise of his revisional jurisdiction under Section 264 of the Income Tax Act, 1961, confirming the order of assessment under Section 147/144 of the Income Tax Act, 1961 treating the petitioner as “Resident”, in the exercise of the limited scope of judicial review by this Court under constitutional writ jurisdiction under Article 226 of the Constitution of India,” the court said.
The court has heard Advocate Ananda Sen for the petitioner and Advocate Mr. P.K. Bhowmik for the respondents.
The ruling would have an impact on the NRI taxpayers during these days where so many people working abroad were stuck in India due to flight cancellation following the global pandemic.
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The Gujarat High Court quashed the recovery notice and remitted the matter to the Authority to give an opportunity of hearing to determine the amount to be paid to depositors.
Mr. S. N. Soparkar, the Senior Counsel, the advocate appearing for the writ-applicants, Golden Trees Plantation Ltd. vehemently submitted that the impugned notice has been issued without giving any opportunity of hearing to the writ-applicants. Mr. Soparkar would submit that a huge amount to the tune of Rs.1,068,64,56,000/- is sought to be recovered from the writ-applicants. The principal argument of Mr. Soparkar is that on what basis the Recovery Officer has arrived at such a mammoth figure is not understood.
Mr. Soparkar submitted that his clients have deposited a substantial amount so far in due compliance with the order passed by the SEBI dated 14.3.2003. Mr. Soparkar pointed out that between 2012 and 2018 the writ-applicant No.1 made a total payment of Rs.10,97,50,000/- to various stakeholders. It is further pointed out that the Company has also made payments to the tune of Rs.23,20,900/- to various other stakeholders. Even according to the respondents, the Company had collected an amount not exceeding Rs.9,23,27,000/-, as against that the Company had incurred the total expenditure of Rs.11,40,04,621/- for nurturing and maintenance of saplings/trees and refunded Rs.11,20,70,000/- to various tree holders.
In such circumstances, Mr. Soparkar prays that there being merit in his writ-application the same be allowed and the matter be remitted to the authority concerned with a direction to give an opportunity of hearing to the writ-applicants and thereafter determine an appropriate amount if at all any amount is to be paid by the writ- applicants.
On the other hand, this writ-application has been vehemently opposed by Ms. Dharmishta Raval, the counsel appearing for the respondents on the ground that the writ- applicants have an alternative remedy to prefer an appeal before the Securities Appellate Tribunal under Section 15(T) of the SEBI Act.
The division bench of Justice J.B.Pardiwala and Justice Ilesh J.Vora pointed out that in such circumstances relegating the writ- applicants, at this stage, to avail the alternative remedy and challenge the recovery notice by way of an appeal would not serve any good purpose.
Instead, the court quashed the recovery notice and remit the matter to the authority concerned with a direction to give an opportunity of hearing to the writ- applicants and thereafter appropriately determine the amount to be paid to the depositors. Of course, it would be open to the writ-applicants to point out to the authority concerned that as of the date they have discharged their liabilities in toto.
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The Orissa High Court held that the Akbari Continental is categorized as a ‘Restaurant’ and is entitled to sales tax exemption.
The Petitioner, Akbari Continental Pvt. Ltd. is a hotelier carrying on the business of providing lodging accommodation and manufacture and sale of food, drinks etc. the Petitioner went in appeal before the ACST. The ACST noted that the Petitioner was entitled to exemption under Sl. NO. 30-FFFF of the Tax-Free Schedule as a continuing unit of IPR-1980. It was noted that the General Manager, DIC, Cuttack by a letter drew the attention of the STO to the fact that as per the recommendation of the State Level Empowered Committee, the Petitioner was held to be entitled to sales tax exemption. However, the 7th State Level Empowered Committee at a meeting reversed its earlier decision. This decision was communicated by the Director, DIC to the STO. The ACST held that the Petitioner was thus entitled to exemption at least till 30th April, 1996. As regards purchase or sale of soft drinks, IMFL and cigarettes, which were not manufactured or processed by the Petitioner, it was held that the Petitioner was entitled to sales tax incentive. Thus, only such deductions as were usually available in respect of such goods as first point tax paid goods were allowed. As a result, the amount payable under the assessment order was reduced to Rs.37,860/-. The excess tax paid was asked to be refunded.
As regards the claim for tax exemption under Entry No.30- FFFF of the IPR 1989, it was held that the Petitioner was not eligible for the said tax exemption since it had failed to produce any certificate to show that it was a SSI unit set up after 1st August 1980 and before 1st April, 1986 and that it had gone into commercial production after 1st April 1986.
The department contended that in the list of industries excluded from the exemption provision under Entry No.30-FFFF was “Guest House and Restaurant”. The Department contended that the activities in the restaurant run by the Petitioner was distinct from that of the hotel and therefore the dealer’s business related to the restaurant was not eligible for tax concession. This explanation was accepted by the Tribunal. The matter was accordingly remanded to the STO for a fresh assessment. The reassessment notice has already been stayed by this Court.
The division bench headed by the Chief Justice Dr. S. Muralidhar and Justice B.P. Routray found no reason why only for AY 1995-96 the Department’s case ought to be accepted by the Tribunal particularly since the eligibility certificate issued by the DIC is the same for all these AYs. Consequently question was answered in favour of the Petitioner and against the Department by holding that the Petitioner is a hotel and does not fall under Clause 27 of the ineligibility list of IPR-1989 and is entitled to sales tax exemption under Entry 30-FFFF in terms of the Finance Department Notification dated 16th August, 1990.
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The Kolkata Bench of Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) ruled that steel items used in the fabrication of capital goods, their accessories inside manufacturing premises are eligible for Cenvat credit.
The Appellant, M/s Jai Balaji Industries Limited is engaged in the manufacture of iron and steel products of different grades classifiable under Chapters 72 & 73 of the first schedule to the Central Excise Tariff Act, 1985. They had availed Cenvat credit on Angles, Channels, Joists, Beams, TMT Bars, Plate, H.R. Coils, H.R. Sheets, Rounds, Sheets. Billets, Flats, Paints, Rails, Castings, Coils, Electrode/Welding Electrode and Miscellaneous Chemical Products falling under different headings. Three periodical show-cause notices were issued by the department. In all the three show cause notices the allegations against the Appellant were that the impugned goods were not defined under Rule 2(a) of the Cenvat Credit Rules, 2004. It was alleged that the said items were not defined as capital goods under Rule 2(a) of the Cenvat Credit Rules, 2004. Accordingly, it was alleged that the credit availed and utilized by the Appellant was irregular.
The Appellant submits that the Cenvat credit was disallowed on Electrode/Welding Electrode which was also used in the manufacturing process without which it is not possible to manufacture the finished goods. It was further submitted that this Tribunal has already allowed the appeal in respect of their sister units where similar/identical items were involved.
The coram of Judicial Member P. K. Choudhary and technical member Raju ruled that eligibility of steel items for cenvat credit has been the subject matter of various decisions by the Hon’ble Supreme Court, various High Courts, and this Tribunal where it has been categorically held that the steel items when they were used in the fabrication of capital goods and their accessories inside the manufacturing premises are eligible for credit. We have gone through the usages of the disputed items in the fabrication of various sections of the plant.
In other words, the definition of Capital Goods includes components, spares, and accessories of such capital goods. Accordingly, applying the User Test to the facts in hand, we have no hesitation in holding that the structural items used in the fabrication of support structures would fall within the ambit of Capital Goods as contemplated under Rule 2(a) of the Cenvat Credit Rules, hence will be entitled to the Cenvat Credit.
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The Institute of Chartered Accountants of India (ICAI) is likely to declare CA Exam Result of July 2021 19th September 2021.
“Result of Intermediate Examination (Old Course & New Course) held in July 2021 are likely to be declared on Sunday, the 19th September 2021(evening)/Monday, the 20th September 2021,” ICAI said.
Candidates can check their CA results in 2021 on the following websites: icaiexam.icai.org, caresults.icai.org, icai.nic.in. CA Inter Exam is the qualifying Inter exam to become a Chartered Accountant in India. These exams are conducted by The Institute of Chartered Accountants of India. These are the most prestigious and terrifying exams for a commerce student.
Candidates who appeared for CA Inter July 2021 exams can check their results by entering 6 digit roll no with 4 Digit PIN at the official result website of ICAI. The Institute of Chartered Accountants of India is the main authority that conducts CA Inter Exams every year in the month of May & In the month of Nov.
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The Jaipur Bench of Rajasthan High Court dismissed the Liquor Vendor’s plea seeking a waiver on the annual guarantee fee and tax relief for Covid’s second wave period.
As many as 120 petitions were filed wherein it was submitted that on account of the various lock-down orders, the licensed shops have virtually remained closed for more than 395 hours out of 680 hours. It is stated that in April and May, 2021, the shops remained closed for 64.28% of the time, and in June 2021, they remained closed for 67.74% of the time. It is further submitted that allowing the opening of liquor shops from 6.00 AM to 11.00 AM was wholly impractical as in the morning hours there is no sale of liquor at all and the sale was reduced immensely.
Mr. RN Mathur, Senior Advocate submitted that the criteria ought to be reasonable and having nexus to the purpose sought to be achieved. It is submitted that the curtailment or reduction of the annual guarantee amount of only 30% as laid down by the respondents is wholly impractical and does not take into consideration the aforesaid circumstances. While the reserve price for bidding of shops is fixed district-wise, 30% reduction is generalized for all shops in Rajasthan. Therefore, the benefit ought to be each district-wise. Learned Senior Counsel further submitted that the yardstick adopted is without application of mind and fixing the time of opening of liquor shops from 6.00 AM to 11.00 AM during five days of the week, is wholly unrealistic and unreasonable. It is submitted that no person comes for purchasing to the shops at the wee hours of the morning and in such circumstances, the State should compensate the dealers proportionally as per lock-down and actual liquor which has been lifted should be the criteria for payment of a first quarter of annual guarantee amount and the annual guarantee amount should be accordingly proportionally reduced instead of continuing to insist for payment on the basis of the bid offered by the petitioners earlier.
Mr. KK Sharma learned Senior Counsel submitted that while the petitioners had submitted their bids during the Covid Pandemic in the year 2020-21, no one could envisage the stipulate of pandemic upto March, 2021. Even the State Government did not put any clause of force majeure and an arbitrary obstinate approach has been taken by the State. When the reduction in the sale is upto 69.62%, the demand for continuing payment of the amount for which liquor has not been sifted or sold is wholly unjustified.
The single bench of Justice Sanjeev Prakash Sharma said that the Loss caused to them cannot be put on the shoulders of the Government as with their open eyes they have submitted higher bids and accepted the conditions of the policy. They cannot now turn around and claim as a right from this Court for mandamus as against the State.
“This Court, however, deems it appropriate to observe that granting of rebate in making payments is an exclusive discretion of the State and falls within the administrative domain of the State Government who has laid down the excise policy. The State Government would, therefore, be the best to take a decision whether further reduction/rebate is required to be granted to the liquor vendors. Leaving it open for the petitioners to take up their cause before the State Government, this Court is of the firm view that writ jurisdiction cannot be invoked for such demands,” the court said.
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The Delhi Bench of Income Tax Appellate Tribunal (ITAT) allowed the business loss including an amount paid as managerial remuneration.
The assessee, M/s. Universal Buildrise Private Limited is a Private Limited Company and filed its return of income declaring loss and paid taxes on book profit under MAT provisions. The case was selected for scrutiny and statutory notice under section 143(2) was issued. During the course of assessment proceedings, the AO noted that assessee company claimed to be engaged in the business of supplying books. He noted that during the financial year 2016-17, the name of the assessee company has been changed from M/s Universal Book Distributors Private Limited to M/s Universal Buildrise Private Limited. The source of income of the assessee company was rental income, but the assessee also claimed to be engaged in the trading of the book etc.
The AO held that the assessee company had not carried out any business activities and the payments made to its Director as remuneration and other expenses are not business expenses. The business loss claimed was just to avoid the tax on income from house property. He, therefore, disallowed the business loss of Rs.44,55,096/- and brought to tax the rental income from house property at Rs.36,28,298/- after allowing the deduction under section 24 of the Income Tax Act, 1961.
The Assessee at the outset submitted that during the A.Ys. 2012-2013 and 2014-2015, the Tribunal has decided the issue in favour of the assessee and had allowed the managerial remuneration as business expenses.
The coram of Accountant Member, R.K.Panda held that the assessee is entitled to the business loss which includes an amount of Rs.39 lakhs paid as managerial remuneration.
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The Patna High Court quashed the demand of GST, interest and penalty as no opportunity of hearing was afforded.
The petitioner, Shashikant Singh has raised several contentions, including non- application of mind on the part of the authorities; the order passed without affording adequate opportunity of hearing; for extraneous factors, only to cover up inaction on the part of the authorities, who after attachment, recovered the amount from the petitioner’s Bank Account and that no adequate opportunity of hearing was afforded to the petitioner before carrying out the impugned action.
Mr. Brisketu Sharan Pandey, counsel for the petitioner has raised several contentions, including non- application of mind on the part of the authorities; the order passed without affording adequate opportunity of hearing; for extraneous factors, only to cover up inaction on the part of the authorities, who after attachment, recovered the amount from the petitioner’s Bank Account and that no adequate opportunity of hearing was afforded to the petitioner before carrying out the impugned action.
The division bench headed by the Chief Justice Sanjay Karol and Justice S. Kumar pointed out that the information was not uploaded on the GST Portal (Form DRC 01 and DRC 01A) and the notice cannot be said to have been served upon the petitioner, for copy of the receipt of the Gmail does not indicate the petitioner’s name.
The court directed the petitioner to appear before the said officer on 27th of September, 2021 at 10:30 A.M., if possible, through digital mode, who shall, after considering all the materials placed on record by the parties, pass a fresh and speaking order, in accordance with law, of course in compliance of principles of natural justice, within a period of two months from the date of appearance of the petitioner
The court directed for de-freezing or de-attaching of the bank account(s) of the writ-petitioner, if attached in reference to the proceedings, subject matter of present petition. This shall be done immediately.
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The Gauhati High Court granted the bail to the person accused of deliberately supplying goods without issuing invoices.
The petitioner, Subhash Kumar Singh was served with a notice under Section 50 of Cr.P.C. by the Superintendent of State Tax Assam, BIEO, Assam, Srimantapur, Guwahati under the provision of Section 132(1) (i) of the Assam GST Act, 2017 (AGST) alleging that sufficient materials have been found against the petitioner regarding his involvement in evasion of taxes and Cess, amounting to more than Rs. 5,00,00,000/- which is a cognizable offence under Section 132(1)(i) AGST Act. It was further alleged that the petitioner is found to have deliberately supplied goods without issuing invoices in violation of the provisions of AGST Act with intention to evade Tax during the period of 2019 to 2021. Pursuant to issue of the said notice under Section 50 Cr.P.C. the petitioner was arrested and was forwarded to the Chief Judicial Magistrate, Kamrup Metro, Assam citing reasons therein, inter alia that, that the respondent has ascertained that the petitioner has deliberately supplied goods without issue of invoices in violation of the provisions of the AGST Act with the intention to evade Tax and Cess.
Mr. Choudhury, learned counsel for the petitioner has submitted that since investigation of the case has been completed and formal offence report has been laid in the Court by the Investigating Agency, there is no scope at all for hampering with the investigation or tampering with any of the materials connected with the case. It has further been submitted by the learned counsel for the petitioner that the offence alleged in the instant case is compoundable in view of the provisions of Section 138 of the AGST Act.
Mr. Phukan, learned Public Prosecutor has submitted that the offences being an economic offence of huge magnitude, the Court may not like to show any leniency towards the petitioner. He has further submitted that there is no prayer made for compounding of the offences. The offences, involved in this case, are compoundable. On this point of argument, a pointed query is made to the learned counsel for the petitioner as to whether any prayer is pending for compounding of the offences to which he replied that the petitioner is likely to exercise his option only on release on bail.
The single bench of Justice Hitesh Kumar Sarma said that for the purpose of further investigation, custodial detention of the petitioner is not essential. As per the materials on record, there is no indication that the petitioner, if granted bail, is likely to evade the trial or there is an apprehension of his tampering with the witnesses. Apart from all these, this Court has also taken into fact that during the period of the entire investigation, the petitioner has been in custody for 65 days.
The direction for bail is further subject to the conditions that the accused-petitioner shall not leave the territorial jurisdiction of the learned Chief Judicial Magistrate, Kamrup (Metro), Guwahati, without prior written permission from him; who, in the event of granting permission to leave the jurisdiction, shall pass a detailed reasoned order for his decision; shall deposit his Passport/visa, etc if any, in the court of the Chief Judicial Magistrate, Kamrup (Metro), Guwahati; shall not tamper with the evidence of the case; shall not, directly or indirectly, make any inducement, threat or promise to any person acquainted with the facts of the case so as to dissuade him from disclosing such facts to the Court or to any police officer; and shall not contact, in any form any of the witnesses of this case.
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The Centre informed the Supreme Court that it allowed former National Company Law Appellate Tribunal (NCLAT) chairperson Justice AIS Cheema to continue in office till September 20, 2021.
The Attorney General, KK Venugopal told a Bench headed by Chief Justice of India NV Ramana and Justices Surya Kant and Hima Kohli that Justice Cheema will be allowed to go to office until September 20 to deliver pending judgments and he will also receive retiral benefits based on that date.
“It was said he took leave to write judgments. So we have decided that he will be allowed to go to office and pronounce judgments, the current chairperson Justice Venugopal will be sent on leave,” the centre told the Court.
“The submission is accepted and consequential orders will be passed. Current chairperson will be on leave till Sept 20. This order is in terms of facts and circumstances,” the Court said.
When the matter was taken up for hearing today, Attorney General KK Venugopal, appearing for the Central government initially said that Justice Cheema will be allowed to continue in office “on paper” till September 20 and will receive consequential retiral benefits. However, he will not be allowed to go to the office.
The Supreme Court had ruled that Section 184(11) of the Finance Act, which prescribes a tenure of four years for members, was contrary to the principles of separation of powers, independence of judiciary, rule of law and Article 14 of the Constitution of India as well as the judgment of the apex court in the Madras Bar Association III case.
“Consequently, the declaration of this Court in para 53(iv) of (the judgment in) Madras Bar Association-III shall prevail and the term of Chairperson of a Tribunal shall be five years or till she or he attains the age of 70 years, whichever is earlier and the term of Member of a Tribunal shall be five years or till she or he attains the age of 67 years, whichever is earlier,” the Supreme Court had ordered.
However, as per Section 5 of the new Act, the term of office of the Chairperson of a tribunal shall be four years or till the person attains age of 70, whichever is earlier. Similarly, for members of tribunals, the tenure has been prescribed as four years or till he/she attains 67 years, whichever is earlier.
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The Dell Technologies has invited applications for the post of Accounting Advisor.
The Accounting Advisor will have an integral role to play in the accounting team. Working with a number of key Dell sites, you will be responsible for preparing income, balance sheet accounts, and other statements.
Responsibilities:
Qualifications:
Location: Bangalore
For more details and to apply, click here:
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The Johnson & Johnson has invited applications for the post of ITC Analyst – Finance.
Responsibilities:
Qualifications:
Location : Chennai, India
For more details and to apply, click here:
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In a setback to DSIIDC, the Delhi Bench of Income Tax Appellate Tribunal (ITAT) ruled that the CIT(A) empowered to revise assessment order on failure of Assessing Officer to make proper inquiry.
The assessee, DSIIDC Ltd. is a State Corporation. During the year under consideration, the Corporation is acting as a Developing and Collecting agency for various schemes i.e. Low Cost Housing Scheme, re-locations scheme, Narela Scheme and CETP Scheme on behalf of the Government of NCT Delhi and also providing infrastructure Services under Delhi State Industrial Operation and Maintenance Act, 2010.
The assessee filed the original e-return declaring income. Later on, the assessee filed a revised e-return declaring income. The case was selected for scrutiny under CASS norms and notice was issued and duly served upon the assessee. In response to notice under section 143(2) and 142(1) Deputy Accountant Manager (Taxation) and AR of the assessee attended the proceedings and furnished a copy of profit and loss account, balance sheet and tax audit report. The assessee claimed deduction under section 80IA(4) to the extent of Rs.111.47 crore as per certificate of Chartered Accountant and submitted that under Delhi State Industrial Operation and Maintenance Act, 2010, the assessee is operating and managing 29 Industrial Sheds and 4 flatted factory complex which are in the nature of infrastructural projects in terms of provisions of Section 80IA(4). The Assessing Officer accepted the claim of the assessee.
The show cause notice under section 263 of the Income Tax Act, was issued by the Principal Commissioner of Income Tax thereby observing that the assessment order to the extent of grant of deduction u/s 80IA(4) of the Act has not been made in accordance with the provisions of the Act and due taxes have not been levied. The Principal Commissioner of Income Tax held that the assessment order for Assessment Year 2011-12 & 2012-13 is erroneous in so far as it is prejudicial to the interest of the Revenue to the extent of grant of deduction u/s 80IA (4) of the Act arising from maintenance of an Industrial Sheds, ground rent, sale of flats and Industrial Sheds and Housing Project for EWS and directed the Assessing Officer to withdraw the same.
The assessee submitted that in the original assessment, the Assessing Officer has raised specific queries regarding the claim u/s 80IA (4).. The assessee pointed out the audit objections and also pointed out the letter regarding the audit objection which was dropped later in relation to 80IA(4) deduction claimed. The Principal CIT has only formed a second opinion which is not permissible under section 263 of the Act and reiterated explanation of Section 263.
On the other hand the department contended that the Assessing Officer has not taken cognizance of the actual definition of infrastructure project as per Section 80IA (4) and without looking into the fulfillment of the conditions under the said Section has simpliciter allowed the claim. Therefore, the Principal Commissioner of Income Tax has rightly held the order to be erroneous and prejudicial to the interest of the Revenue.
The coram of Accountant Member, R.K.Panda and Judicial Member Suchitra Kamble while relying on the decision of the Supreme Court in case of Deniel Merchants Private Limited & Anr. Vs. Income Tax Officer held that the Assessing Officer has not properly adjudicated the issue as per law and, therefore, the Pr. CIT has rightly invoked Section 263 of the Act and passed the order. Therefore, the Order under Section 263 of the Income Tax Act, 1961 passed by the Principal Commissioner of Income Tax is just and proper. There is no need to interfere with the same.
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The Delhi Bench of Customs, Excise and Service Tax Appellate Tribunal (CESTAT) said that the Custom Broker to verify genuineness of importer-exporter code, IEC number, identity of client to prevent facilitation of export prohibited goods.
The appellant, M/s CSB Logistics is a custom broker under Regulation 11 of CBLR, 2013 to verify antecedent and correctness of import export code, identity of the client and existence of their client at the declared address by using reliable independent authentic documents, data or information. It is a matter of record that the appellant never met the exporters/ owner of M/s Fashion World of the alleged consignment. Thus, this appellant failed to verify the antecedent of the exporter and or fulfilling the KYC norm under Regulation 11 of the CBLR, 2013.
The coram of Judicial Member, Anil Choudhary ruled that as a custom broker deals with documents and details of export or import consignment for clearance, and is the representative of their client importer or exporter, before the customs. Accordingly (CSB Logistics), are liable for penal action under Section 114 of the Act.
“The appellant M/s CSB Logistic (Custom Broker) was duty bound as a Custom Broker under the Regulation of 2014 to verify antecedents and genuineness of the importer exporter code, IEC number, identity of their client and functioning of their client at the declared address by using reliable, independent and authentic documents/ data/ information. As per the facts on record, the Custom Broker did not meet the exporter or the owner of the said Fashion World or the mastermind Reyaz Ahmed alias Rajbir alias Dharmendra, the person who originated the goods for exporter, which were prohibited. Thus, their negligence has facilitated the mischievous exporter in attempting to export prohibited goods. Further, they have similarly facilitated the export of about eight consignments in the recent past and there is reasonable belief that such consignments also had prohibited goods,” the CESTAT said.
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The Heads of Tax Authorities of the BRICS countries, namely the Federative Republic of Brazil, the Russian Federation, the Republic of India, the People’s Republic of China and the Republic of South Africa held a virtual meeting here today under the Chairship of India.Shri Tarun Bajaj, Secretary, Revenue, Government of India, in his capacity as Head of Tax Authorities in India, presided over this meeting.
The BRICS Tax Authorities engaged in discussion on the challenges faced by BRICS tax administrations in the digital era, coupled with outbreak of COVID-19 pandemic, sharing experience and devising strategies to overcome those challenges. The broad theme of the meeting was redefining business processes of tax administration amidst challenges posed by COVID-19 and in the digital era. During the meetings, the tax authorities also exchanged opinions and views based on existing commitment to the principles of mutual respect, consolidation and continuity as stated in the XIII BRICS Summit, New Delhi Declaration issued on 9th September, 2021.
The meeting was preceded by meetings of the Tax Experts of BRICS countries on 13th & 14th September, 2021. In this meeting, the tax experts discussed potential areas of cooperation, exchanged views and the experiences. The discussion took place around relevant topics which include digitisation of tax administration, leveraging technology for tackling tax evasion, changing role of tax administration from enforcement to service, preparedness and strategies to deal with challenges of COVID-19 and evolution of tax administration to enhance voluntary compliance by taxpayers.
A communiqué was also issued at the conclusion of the Tax Heads meeting.
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The Institute of Chartered Accountants of India (ICAI) on Wednesday notified the Relaxation in Study Period for students appearing in the May 2022 Intermediate Examination after passing the July 2021 Foundation Examination.
In order to remove hardship caused to the students due to postponement of May, 2021 Foundation Examination, the Competent Authority has decided that the students who have cleared July, 2021 Foundation Examination are required to register in Intermediate Course till November 1, 2021 in order to appear in May, 2022 Intermediate Examination.
Such students are allowed to appear in the Intermediate Examination to be held in May, 2022 after completion of six months Study Period in place of eight months Study Period.
All CA students who have cleared the foundation exam can appear for the intermediate exam scheduled to be held in May, 2022. These students can register for the intermediate exam till November 1.
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A CBI special court here on Tuesday convicted 5 accused including Chartered Accountant in 2003 Coal Scam Case related to the Lalgarh (North) coal block allocated during the Atal Bihari Vajpayee government in 2003.
The Special Judge, CBI Cases, Rouse Avenue Courts, New Delhi has today convicted Shri Binay Prakash, then Managing Director of M/s Domco Pvt. Ltd., Ranchi; Shri Vasant Diwakar Manjrekar & Shri Paramananda Mondal, both the Directors of M/s Domco Pvt. Ltd.; Shri Sanjay Khandewal, Chartered Accountant, Kolkata and M/s Domco Pvt. Ltd., Ranchi (Jharkhand) in a Coal Scam case.
CBI had registered the instant case against M/s Domco Pvt. Ltd. Ranchi & its Promoters/Directors and other unknown persons. This case was registered on the basis of a preliminary enquiry initiated by CBI on the directions received from CVC related to coal blocks allocated during the period from 1993 to 2005. During enquiry, it was revealed that the Lalgarh (North) Coal block was identified in favour of the company by the 19th Screening Committee and accordingly, the company was intimated vide MoC letter dated 24.11.2003. It was further alleged that Shri Binay Prakash, Promoter Director of M/s Domco Pvt. Ltd. entered into conspiracy with unknown persons and submitted false information to the concerned authorities while applying for a captive coal block and secured allocation of Lalgarh (North) Coal Block. In furtherance of the conspiracy, the accused allegedly gained pecuniary benefits of Rs. 7 crore (approx.) by selling shares of the company on premium, after the allocation of the coal block.
After investigation, chargesheet was filed on 22.12.2015 against the accused. The Trial Court found the five accused guilty and convicted them. The case has been postponed for 15.09.2021 for arguments on quantum of sentence.
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The Directorate General of GST Intelligence (DGGI) Gurugram Zonal Unit (GZU), Haryana has arrested 3 persons including a CA on charges of creating and operating multiple fictitious firms on forged documents and passing large amounts of fake input tax credit by way of issuance of invoices without any actual receipt or supply of goods or services.
From the investigation conducted till date, it has been established that one of the arrested persons has created at least 13 firms and has been involved in availing and passing on of a total fraudulent ITC of Rs 121 crore.
It has also emerged that the person who had created the fake/dummy firms worked in tandem with a commission agent, who used to sell these goodless invoices to established firms for commission, both directly and through different brokers. The commission agent has also been arrested.
Further, in this chain from the financial movement it has emerged that established firms (end-users) would make transfers to these fake firms, from where the amounts would then be transferred to the account of a private limited company from where the CA in question would withdraw and return the said amount in cash after deducting the commission of his company as well as his own commission. The amounts of cash transactions ranged around Rs 30-40 lakh per day.
The investigation spanned multiple locations and based on verifications, evidence and statements recorded, it has appeared that the these three persons i.e. the creator of the fake firms, commission agent and the CA were operating in tandem orchestrating this racket of making fake firms on forged documents and having passed on fraudulent ITC amounting to Rs 121 crore (so far). Accordingly, they were arrested under the provisions of Section 69 read with Section 132 of the CGST Act, 2017 on 13.09.2021 and produced before CMM, Delhi, who ordered 14 days judicial custody.
Further investigations in the matter are under progress.
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The Karnataka Appellate Authority of Advance Ruling (AAAR) ruled that the Supplies made by Cost Centres to Bangalore Metro Rail Corporation Limited (BMRCL) to be considered as independent supplies, respective rate of GST to apply on supply of goods, service.
The respondent M/s. BEML Limited entered into a contract with M/s BMRCL for the manufacture and supply of Standard Gauge Intermediate Cars. The activity of manufacture and supply of Standard Gauge Intermediate Cars involves the supply of both goods and services which is undertaken by Cost Centres.
The nature of supply undertaken by each of the Cost Centres of the Respondent Company were preliminaries & General Requirements for Rolling Stock including Design’ which is incidental to supply of rolling Stock; Delivery and receipt of offshore manufacturing; Delivery and receipt of indigenous manufacturing; Commissioning and Acceptance of trains/ cars in Depot; Taking over of unit/train for revenue services; Supply of Unit Exchange spares, mandatory spares and consumable spares and special tools testing and diagnostic equipment Training, Operation and Maintenance Manuals (Optional) which is incidental but integral art of the Supply Contract.
The Karnataka Authority for Advance ruling examined the case of the Respondent and arrived at the conclusion that the supplies made by the Respondent Company under Cost Centers form a composite supply and since the supply of goods i.e intermediate cars is the principal supply, the rate of tax as applicable to the supply of intermediate cars will be applicable to the composite supply in terms of Section 8 of the CGST Act, 2077. The Authority also held that Section 12 of the CGST Act, 2017 is applicable to the issues related to the time of supply.
However, the Assistant Commissioner of central Tax has appealed from the AAR’s ruling and contended that each and every transaction should be viewed as a sep transaction, though it may be part of larger contract; that each contract or agreement is unique and any analysis should be made within the framework of the agreement taking into account the facts and figures. They submitted that the AAR has not taken into account scope of the terms and conditions of the agreement for any analysis and has given findings which are contrary to the agreed terms and conditions; that the goods/services delivered need to be assessed on merits and appropriate classification needs to be done and merit rate of tax to be paid; that even in the absence of any written agreement or contract or MOU, the goods/services/goods and services should be assessed as they are presented at the time of supply/delivery.
The coram of D.P.Nagendra Kumar and Shikha C set aside the AAR ruling and held that supplies made by Cost Centres to M/s BMRCL are to be considered as independent supplies of goods and services as indicated in the Table below and rate of GST as applicable to the supply of goods and supply of service will apply.
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The Karnataka Appellate Authority of Advance Ruling (AAAR) ruled that the number of tasks entrusted through a single contract would not constitute ‘composite supply’.
The coram of The coram of D.P.Nagendra Kumar and Shikha C noted that there are multiple supplies of both goods and services being undertaken as part of this contract. While the supply from Cost Centre C is a supply of goods i.e. the Standard Gauge Intermediate Cars, the supply by Cost Centre D is primarily a service of commissioning and installation of the Cars supplied by Cost Centre C. Similarly, the supply from Cost Centre E is a service of joint inspection and completion of defects/deficiencies observed during integration test and joint inspection. The supply of spares from Cost Centre G is purely a supply of goods.
The bone of contention is whether the supplies by Cost Centres C, D, E and G are to be termed as a composite supply or not.
For a supply to be considered a composite supply, its constituent supplies should be so integrated with each other that one cannot be supplied in the ordinary course of business without or independent of the other. In other words, they are naturally bundled. The term “naturally bundled has not been defined in the GST Act. The concept of the “Naturally Bundled”, as used in Section 2(30) of the CGST Act, 2017, lays emphasis on the fact that the different elements in a composite supply are integral to the overall supply and if one of the elements is removed the nature of supply will be affected. We fail to see this concept in this contract.
The AAAR added that although there is only one contract, the different activities done by the Cost Centers C, D, E and G as part of the contract, are clearly specified and identifiable. The scope of works undertaken by each Cost Centre C, D, E and G are entirely independent and specific to that cost center and is not associated with any other Cost Centre. The work taken by the Cost Cemre D commences only on completion of all the milestone activities of Cost Centre C. Similarly, the work undertaken by Cost Centre E and G commence only on completion of all the milestone activities of Cost Centers D and E respectively. Therefore, it is evident that each Cost Centre is independent and every milestone supply made from the Cost Centre is an independent transaction.
Therefore, each supply by the Cost Centers C, D, E and G is clearly identifiable at the time of raising the invoice as to whether it is a supply of goods or a supply of service and the cost attributable to each supply is predetermined and laid down in the Pricing document which is part of the Contract. As such the Appellate Authority while setting aside AAR’s ruling, agreed with the Appellant’s contention that each transaction by the individual Cost Centers are to be assessed independently according to the nature of supply.
The lower authority ruled that the supplies made by the Respondent Company under Cost Centers form a composite supply and since the supply of goods i.e intermediate cars is the principal supply, the rate of tax as applicable to the supply of intermediate cars will be applicable to the composite supply in terms of Section 8 of the CGST Act, 2077. The Authority also held that Section 12 of the CGST Act, 2017 is applicable to the issues related to the time of supply.
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