Half Yearly Digest of Tax Cases: Supreme Court and High Court Judgments [Part 12]

A Round-Up of all the Supreme Court and High Court Tax Decisions in the First Half of 2024
Half Yearly Digest - Tax Cases - Supreme Court - High Court Judgments - taxscan

This half-yearly round-up analytically summarizes the key Direct and Indirect Tax Judgments of the Supreme Court and all High Courts of India reported at Taxscan.in during the First half of 2024.

Challenge on Applicability of Penalty under Amended Rule of M.P Foreign Liquor Rules: Supreme Court directs to Apply Amended Rule PERNOD RICARD INDIA (P) LTD. vs THE STATE OF MADHYA PRADESH CITATION:   2024 TAXSCAN (SC) 217

In the case where the challenge on the applicability of the Amended Rule in Madhya Pradesh (MP) Foreign Liquor Rules,1996, the Supreme Court directed to application of the amended rule

The court underscored the importance of a simple and plain understanding of laws and their processes, keeping in mind the purpose and object.

The two-judge bench of Justice Pamidighantam Sri Narasimha and Justice Aravind Kumar held that the penalty to be imposed on the appellants will be based on Rule 19 as substituted on 29.03.2011.

Interest Free or Concessional Loans to Bank Employees Are Taxable under Income Tax Rules as Perquisite ALL INDIA BANK OFFICERS vs THE REGIONAL MANAGER CITATION:   2024 TAXSCAN (SC) 215

The Supreme Court held that Interest Free or Concessional Loans to Bank Employees Are Taxable under Income Tax Rules as Perquisite under Section 17 of the Income Tax Act, 1961.s

A two judge bench of the Supreme Court comprising of Justice Sanjiv Khanna and Justice Dipankar Datta observed that the employer’s grant of interest-free loans or loans at a concessional rate will certainly qualify as a ‘fringe benefit’ and ‘perquisite” and held that grant of an interest-free loan or loans at concessional rate would qualify as perquisites or fringe benefits.

Adjusting Refund Amount against Amounts due under Default Notices issued Subsequent to Refund Period is not Justifiable under DVAT Act COMMISSIONER OF TRADE AND TAXES VS FEMC PRATIBHA JOINT VENTURE CITATION:   2024 TAXSCAN (SC) 219

The Supreme Court of India held that adjusting refund amount against amounts due under default notices issued subsequent to refund period is not justifiable under the Delhi Value Added Tax Act, 2004 (DVAT Act).

A Two-Judge Bench comprising Justice Pamidighantam Sri Narasimha and Justice Prasanna Bhalachandra Varale observed that “By the time when the refund should have been processed as per the provisions of the Act, the dues under the default notices had not crystallised and the respondent was not liable to pay the same at the time. The appellant-department is therefore not justified in retaining the refund amount beyond the stipulated period and then adjusting the refund amount against the amounts due under default notices that were issued subsequent to the refund period.”

No Justifiable Grounds for Condoning Delay: Supreme Court dismisses SLP filed by Income Tax Department  INCOME TAX OFFICER vs ASEFA ZOHAR MALAMPATTIWALA CITATION:   2024 TAXSCAN (SC) 220

The Supreme Court of India dismissed a Special Leave Petition (SLP) filed by the Income Tax Department against the director of Overseas Maritime Agencies Private Limited after a 466-day delay in filing the petition.

The two-judge bench of Justices Pamidighantam Sri Narasimha and Aravind Kumar held that the Income Tax Department did not provide justifiable grounds for the significant delay in filing the petition. After considering the arguments, the bench dismissed the Special Leave Petition (SLP) based on the delay.

SC grants Interim Bail for PMLA Accused in absence of Predicate Offence SUNIL KUMAR AGRAWAL vs DIRECTORATE OF ENFORCEMENT CITATION:   2024 TAXSCAN (SC) 221

The Supreme Court granted interim bail to a Chhattisgarh-based businessman, who was arrested in connection with a money laundering case involving the illegal levy on coal transportation. The Court dismissed the interim bail in absence of predicate offence under Section 384 of IPC or any other provision of IPC against him.

A two judge bench comprising justices Surya Kant and Vishwanathan held that “As of date there is no predicate offence under Section 384 of IPC or any other provision of IPC against the petitioner. The chargesheet has been filed only under Sections 204 and 353 of IPC, and both are not scheduled offences under the Prevention of Money Laundering Act ( PMLA )”.

Special Court Presided By Sessions Judge Has Jurisdiction to Hear Offences Under Insolvency Bankruptcy Code INSOLVENCY AND BANKRUPTCY BOARD OF INDIA vs SATYANARAYAN BANKATLAL MALU & ORS CITATION:   2024 TAXSCAN (SC) 222

The Supreme Court has held that a Special Court presided by a Sessions Judge or Additional Sessions Judge has the jurisdiction to hear offences under the Insolvency and Bankruptcy Code.

The Court held that the provision of Section 435 of the Companies Act, 2013 with regard to Special Court would become a part of Section 236(1) of the Code as of the date of its enactment.

Legality of revision of Order of ITAT u/s 254 on Ground of Retrospective Overruling: Supreme Court directs to approach prescribed authority under ITAT Order M/S LAKSHMI SUGAR MILLS CO. LTD. vs COMMR.OF I.T .CIRCLE 4 (1) CITATION:   2024 TAXSCAN (SC) 223

The Supreme Court directed the petitioner to approach the prescribed authority mentioned in the Income Tax Appellate Tribunals Order (ITAT). The Special Leave Petition arose out of the final judgment and order passed by the Delhi High Court. The issue was in related to the legality of the revision of the order of ITAT under section 254 of the Income Tax Act, 1961.

A two-judge bench of Justice Surya Kant and Justice Dipankar Datta disposed of the Special Leave Petition with liberty to the petitioners to raise all the legal and factual contentions before the Prescribed Authority to whom the matter has been remitted by the Tribunal.

Gross delay of 399 days: SC dismisses SLP by Income Tax Department  THE PRINCIPAL COMMISSIONER OF INCOME TAX 13 vs GIRDHAR GOPAL DALMIA CITATION:   2024 TAXSCAN (SC) 224

The Supreme Court of India dismissed the special leave petition ( SLP ) filed by the Income Tax Department on ground of gross delay of 399 days.

A Two-Judge Bench of Justice BV Nagarathna and Justice Augustine George Masih observed that “There is a gross delay of 399 days in filing this special leave petition. The explanation given for condonation of the delay is not satisfactory or sufficient in law to condone the same. Hence, the application seeking condonation of delay is dismissed.”

Supreme Court issues Notice to Adani Wilmar w.r.t. VAT Classification of Bakery Shortening THE COMMISSIONER, COMMERCIAL TAX vs M/S ADANI WILMAR LTD. CITATION:   2024 TAXSCAN (SC) 226

The Supreme Court issued notice to the Adani Wilmar Ltd with regards to the treating the ‘Bakery Shortening’ and Vanaspati ( Hydrogenated Vegetable Oil ) as one and the same commodity and is taxable at 4% under the Entry No. 130 of Schedule II, Part – A of the U.P. VAT Act, 2008.

The bench of Justices B V Nagarathna and Justice Augustine George Masih of the Supreme Court, upon hearing the counsels AOR Bhakti Vardhan Singh, Adv. S. N. Verma and Adv. Ankit Khatri appeared to have decided to condone delay and issue notice to the Adani Wilmar.

Supreme Court lists Bajaj Auto Property Tax Hearing for July 22, Directs State to Halt Coercive Penalty Recovery BAJAJ AUTO LTD. vs STATE OF MAHARASHTRA & ORS. CITATION:   2024 TAXSCAN (SC) 228

 The bench of Justices Abhay S. Okha and Ujjal Bhuyan have directed the state not to take any coercive action against the petitioner  Bajaj Auto Ltd for recovery of the penalty amount.

The court considered the submission of the petitioner’s counsel that the principal amount of demand of property tax has been paid and only the penalty remains to be paid. Further, the apex court allowed the applications for exemption from filing a certified copy of the impugned judgment and exemption from filing official translation.

Alleged Excess ITC Claim: Delhi HC quashes Penalty Order for Non-consideration of GSTR-2A and Reply, Remands SCN for Readjudication  MAA PADMAWATI LAMINATION vs COMMISSIONER DELHI GOODS AND SERVICE TAX AND OTHERS CITATION:   2024 TAXSCAN (HC) 1115

The Delhi High Court has set aside an order concerning an alleged excess claim of Goods and Services Tax ( GST ) Input Tax Credit( ITC ) for the financial year 2018-2019.

The Division Bench had found that the Proper Officer had not carefully examined the submitted forms.  In result, the impugned order was set aside.

Kerala HC Directs Income Tax Department to Expedite Stay Petition on Assessment Order; Further Proceedings Put on Hold  SEA PRIDE FUELS vs INCOME TAX OFFICER CITATION:   2024 TAXSCAN (HC) 1113

The Kerala High Court has directed the Income Tax Department to consider a stay petition filed by Sea Pride Fuels against an assessment order. The writ petition filed by the company challenged the assessment order issued by the department.

As per the court order, all further proceedings based on the original assessment order will be put on hold until the department issues a decision on the stay petition. The court disposed of the writ petition

Madras HC Instructs CIT(A) to Expedite Appeals of Educational Trust in Rs. 3.98 Crore Income Tax Demand within 6 Months Sree Ayyappa Educational Society vs The Union of India CITATION:   2024 TAXSCAN (HC) 1116

The Madras High Court instructed the Commissioner of Income Tax (Appeals) [CIT(A)] to expedite the appeals filed by the Educational Trust in Rs. 3.98 crore income tax demand within 6 months.

After considering the arguments from both sides and reviewing the records, a Single bench of Justice R. Rajasekhar acknowledged the petitioner’s situation. Given that the petitioner operates an educational institution and faces substantial financial assessments, the court found it reasonable to expedite the appeal process.

Kerala HC allows Writ Petition seeking Stay on Assessment Order, Directs to Pass Orders Within Two Months JOSEPH PONEKATTU VAKKACHAN vs INCOME TAX OFFICER CITATION:   2024 TAXSCAN (HC) 1114

The Kerala High Court granted stay on further proceedings in a dispute over a tax assessment order, directing the respondent to take up the stay petition and appeal expeditiously.

The bench of Justice Viju Abraham directed the Appeal Centre to dispose of the stay petition within two months of receiving a copy of the judgement. The petitioner would be granted a hearing before the order is issued.

Bombay HC quashes Reassessment Notice under Income Tax Act in Absence of Change in Opening and Closing Stock of NCD’s Upesi Ventures Ltd vs The Assistant Commissioner of Income Tax CITATION:   2024 TAXSCAN (HC) 1109

The Bombay High Court has quashed the reassessment notice issued under the Income Tax Act, 1961 as there was no change in the opening and closing stock of the non-convertible debts ( NCDs ). It was found that the reopening of the assessment is merely based on a change of opinion of the AO from that held earlier during assessment proceedings.

It was found that the reopening of the assessment is merely based on a change of opinion of the AO from that held earlier during assessment proceedings, and this change of opinion does not constitute justification and/or reason to believe that income chargeable to tax has escaped assessment.

GST Dept Insists to Pay Undue Interest: Madras HC directs to Consider Request made under Amnesty Scheme M/s.Amar Trading Corporation vs Union of India CITATION:   2024 TAXSCAN (HC) 1107

The Madras High Court directed the Goods and Services Tax ( GST ) department to consider a request made under the Amnesty Scheme to waive late fees. The court issued this directive while hearing a writ petition for a mandamus, which was filed after the GST Department insisted the petitioner pay undue interest.

A Single bench of Justice B. Pugalendhi disposed of the writ petition with a directive for the respondent to consider the petitioner’s representation and make a decision in accordance with Notification No. 7/2023-CT, dated 31.03.2023, as amended by Notification No. 25/2023-CT, dated 17.07.2023, within three months from the date of receipt of a copy of this order. Until then, any enquiry pursuant to the show cause notice shall be deferred.

Allahabad HC warns of Disciplinary Action and Heavy Costs on GST Officers for Denying Hearing Opportunity Ns Agro And Engineering Products vs State of U.P. and Another CITATION:   2024 TAXSCAN (HC) 1100

The Allahabad High Court has warned the Commissioner, Commercial Tax, Uttar Pradesh of  disciplinary action and heavy costs on the Goods and Services Tax ( GST ) officials who denied the opportunity for hearing from the taxpayer. The court noted the violation in Principles of Natural Justice.

The High Court emphasised that personal hearings are a fundamental right in adjudication proceedings. It stated that adverse orders must be preceded by a hearing unless waived by the noticee, and failure to provide such an opportunity constitutes a violation of natural justice principles

Delhi HC directs to Process Application for Cancellation of GST Registration on Closure of Business  M/S SHREE SHAKTI SALES vs PRINCIPAL COMMISSIONER OF DEPARTMENT OF TRADE AND TAXES CITATION:   2024 TAXSCAN (HC) 1095

The Delhi High Court directed to process application for cancellation of GST Registration on closure of business.

A Division Bench of Justices Sanjeev Sachdeva and Ravinder Dudeja observed that “Issue notice. Notice accepted by learned counsel appearing for respondents. In view of the facts and circumstances, this petition is disposed of directing the respondents to process the application of petitioner seeking cancellation of its GST registration and dispose of the same, if not already done, within the period of two weeks from today with intimation to the petitioner.”

Proper Officer should consider Reply on Merits to form Opinion: Delhi HC quashes Demand of 7 Crores  KALPATRU PROJECTS INTERNATIONAL LIMITED vs GOODS AND SERVICE TAX OFFICER CITATION:   2024 TAXSCAN (HC) 1102

The Delhi High Court quashed the demand of 7 crores and held that the Proper Officer should consider reply on merits to form an opinion.

A Division Bench of Justices Sanjeev Sachdeva and Ravinder Dudeja observed that  the demand was not sustainable as the petitioner gave a detailed reply with supporting documents. The court further observed that the Proper Officer had to at least consider the reply on merits and then form an opinion. He merely held that the reply is not found to be satisfactory, which ex-facie shows that Proper Officer has not applied his mind to the reply submitted by the petitioner.

Appeal preferred against Assessment Order under Income Tax Act: Kerala HC stays Recovery of Amount SREE DHARMA PARIPALANA YOGAM vs INCOME TAX OFFICER CITATION:   2024 TAXSCAN (HC) 1093

The Kerala High Court stayed the recovery of amount on the ground that appeal has been preferred against the assessment order under the Income Tax Act, 1961.

The petitioner suffered order of assessment for the assessment year 2023-24, under the provisions of the Income Tax Act. The petitioner has preferred appeal against the order of assessment before the 3rd respondent, along with application for stay.

Coercive Proceedings for Recovery of Financial Advance: Kerala HC directs to Clear off Liability M/S KERALA REMEDIES vs UNION OF INDIA CITATION:   2024 TAXSCAN (HC) 1096

The Kerala High Court directed to clear off liability against the coercive proceedings for recovery of financial advance.

The petitioners approached the Court aggrieved by the coercive proceedings for recovery of financial advance made by the DCB Bank to the petitioners, invoking the provisions of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002.

The specific case of the petitioners is that the petitioners have been making the repayment and maintaining the loan account initially. The default in repayment of the account occurred lately due to reasons beyond the control of the petitioners. The petitioners have provided substantial security which will safeguard the interest of the Bank.

Benami Transaction cannot be proved without Supporting Material along With Statement of Contractor: Allahabad HC Quashes Benami Transaction Proceedings Smt. Meera Pandey Thru. Her Attorney vs Union Of India CITATION:   2024 TAXSCAN (HC) 1089

The Allahabad High Court has held that mere statement of the contractor doing construction work cannot be relied upon to declare such construction as benami transaction under the Prohibition of Benami Property Transactions Act, 1988. The Court held that “reasons to believe” in Section 24(1) of the Act must be based on cogent and relevant material.

The Court observed that since the assessment proceedings with respect to petitioner’s income tax return were underway, the Department could have claimed that her earnings of the that year were beyond the known sources of income. The Court further observed that the material sought to be relied on by the counsel for department at the time of hearing of the writ petition was never mentioned in the show cause notice issued to the petitioner.

Authority should Refrain from Over Analysis which leads to Paralysis of Justice: Bombay HC directs AO to pass Fresh Assessment Order  Bhatewara Associates vs Income Tax Appellate Tribunal CITATION:   2024 TAXSCAN (HC) 1086

The Bombay High Court directed the Assessing Officer (AO) to pass fresh assessment order and observed that the “Authority should refrain from over analysis which leads to paralysis of justice”.

A Division Bench of Justices Dr Neela Gokhale and KR Shriram observed that “The High Court had very categorically observed that the authority should refrain from over analysis which leads to paralysis of justice. Therefore, the delay having been condoned by the High Court, we hereby quash and set aside the assessment order dated 14th March 2014 and remand the matter to the stage of the Assessing Officer (“AO”), who shall pass fresh assessment order in accordance with law by considering the claim for deduction under Section 80IB(10) of the Act for AY 2011- 12 made by Petitioner as if there was no delay in filing the return.”

Andhra Pradesh HC Dismisses revision petition filed by challenging order of Trial Court with respect to Property Tax Receipt  P.venkatrayulu vs The Commissioner and Others CITATION:   2024 TAXSCAN (HC) 1083

The Andhra Pradesh High Court dismissed a revision petition filed by challenging the order of trial court with respect to property tax receipt.

After analyzing the facts and arguments of both parties, a single  bench of Justice R Raghunandan Rao held that the receipt issued by the Commissioner, Madanapalle Municipality has already been recognized by the trial Court and as such, there can be no complaint that such receipt will not be treated as a true and proper receipt. Therefore the bench dismissed the revision petition.

Cancellation of Licences under United Provinces Excise Act Cannot Be Due To Suspicion: Allahabad High Court Sandeep Singh vs State Of U.P. And 2 Others CITATION:   2024 TAXSCAN (HC) 1081

The Allahabad High Court has held that the cancellation of a license under Section 34(2) of the United Provinces Excise Act, 1910 cannot be based on suspicion. The Court held that without there being any cogent material or evidence such harsh penalty of cancellation of license must not be invoked.

A division bench of Justice Saumitra Dayal Singh and Justice Donadi Ramesh observed that in the cancellation order, the authorities had merely stated that license for shop at Majhenpurwa was being cancelled as petitioner’s license at Gehrukheda stood cancelled, however, no reasons were provided as to how that cancellation would affect the license for shop at Majhenpurwa.

Go First Case: Delhi HC directs DGCA to Process De-Registration of Leased Aircrafts ACCIPITER INVESTMENTS AIRCRAFT 2 LIMITED vs UNION OF INDIA CITATION:   2024 TAXSCAN (HC) 1080

The Delhi High Court directed the DGCA to process de registration of leased aircrafts in the much celebrated Go First case.

The principal grievance of the Petitioners/Lessors as articulated in the present Petition was0 that the Respondent/DGCA has failed to deregister their Aircraft(s) in contravention of Sub-Rule (7) of Rule 30 of the Aircraft Rules, 1937.

The court observed that The inconvenience of a specific party cannot outweigh the statutory provisions and the International Treaty obligations which are applicable to these Aircraft.

Non-Application of Mind by Proper Officer: Delhi HC quashes GST demand of Rs 1 crore M/S. RPJ POLYMERS THROUGH ITS PROPRIETOR vs UNION OF INDIA & ORS CITATION:   2024 TAXSCAN (HC) 1076

The Delhi High Court quashed GST demand of Rupees one crore as there was non-application of mind by the Proper Officer.

A Division Bench of Justices Sanjeev Sachdeva and Ravinder Dudeja observed that “Proper Officer had to at least consider the reply on merits and then form an opinion. He merely held that the reply is not supported with complete relevant documents, which ex-facie shows that Proper Officer has not applied his mind to the reply submitted by the petitioner. Further, if the Proper Officer was of the view that any further details or documents were required, the same could have been specifically sought from the Petitioner. However, the record does not reflect that any such opportunity was given to the Petitioner to clarify its reply or furnish further documents/details.”

Delhi High Court sets aside Retrospective GST Registration Cancellation citing Lack of Clarity; Modifies Cancellation date to Petitioner’s Application Date SWATI GUPTA vs COMMISSIONER OF DELHI GOODS AND SERVICES TAX Case Number:   2024 TAXSCAN (HC) 1073

The Delhi High Court overturned a decision by the Commissioner of Delhi Goods and Services Tax to cancel the Goods and Services Tax ( GST ) registration of the petitioner retrospectively.

The court highlighted that retrospective cancellation has implications for ITC, affecting their customers. Therefore, such cancellations should only be made when justified and necessary. In result, the court modified the cancellation of the petitioner’s GST registration to the date of her application for cancellation, i.e., June 20, 2020.

Madras HC Grants Second Chance to Submit Documents for GSTR-1 vs GSTR-3B Discrepancies without Pre-deposit Condition  Mr. Hajabandenawas vs The State Tax Officer CITATION:   2024 TAXSCAN (HC) 1069 Counsel for Appellant:   Mr. S. Shamili

The Madras High Court granted a second chance to the petitioner to submit the documents with regards to the GSTR 1 and GSTR 3B discrepancies without the Pre-deposit condition.

After hearing both sides and reviewing the materials presented, a single bench of Justice N. Senthilkumar decided to set aside the impugned order dated October 12, 2023, based on the mismatch between the GSTR-1 and GSTR-3B returns. The Court acknowledged the petitioner’s willingness to submit all relevant documents and explanations to the first respondent.

Delhi HC directs Income Tax Dep to Allow Personal Hearings through National Faceless Assessment Center  GLOBAL VECTRA HELICORP LIMITED vs ASSESSMENT UNIT CITATION:   2024 TAXSCAN (HC) 1063

The Delhi High Court directed the Income Tax Department to allow personal hearings through the national faceless assessment center. It was observed that since the request for video conferencing was made by the petitioner, the respondent must accede to the same in terms of Section 144B(6)(viii) of the Income Tax Act, 1961.

A division bench of Justice Vibhu Bakhru and Justice Tara Vitasta Ganju held that since the request for video conferencing was made by the petitioner, the respondent must accede to the same in terms of Section 144B(6)(viii) of the Act.  It is well recognized that an opportunity to be heard is an important facet of natural justice.

Money Laundering Case: Bombay HC Grants Two-Month Interim Bail To Jet Airways Founder Naresh Goyal Considering Critical Stage of Illness Naresh Goyal vs The Directorate of Enforcement and Anr CITATION:   2024 TAXSCAN (HC) 1065

The Bombay High Court granted interim bail for two months to Jet Airways founder Naresh Goyal in a money laundering case arising out of an alleged loan default of Rs. 538 Crores.

The bail was granted by Justice NJ Jamadar considering the critical stage of illness for two months.

 A Special PMLA Court denied Goyal interim bail on medical grounds but allowed him to be hospitalized for two months for cancer treatment.

GST Collection from Punters: Karnataka HC refuses to quash FIR on Tax Evasion Allegation against Bookies in Bangalore Turf Club SURYA AND CO vs STATE OF KARNATAKA CITATION:   2024 TAXSCAN (HC) 1057

The Karnataka High Court refused to quash proceedings initiated against licensed and unlicensed bookies operating within the Bangalore Turf Club who allegedly collected GST from the punters and TDS amount from the winning bettors.

The bench noted that offence under Section 78(1)(a)(i) would not get attracted for betting accepted or collected by licensed bookies on the day on which the horse race is run in an enclosure set apart for a race course by the licensee of such race course, provided the licensed bookies have strictly complied the terms of the licence. However, insofar as the unlicensed bookies are concerned, the offence under Section 78(1)(a)(i) of the Act gets attracted as they are not covered under the exception found in Section 2(7) of the Act.

Issue on Unexplained Cash Deposit u/s 69 A of Income Tax Act: Kerala HC dismisses Writ Petition on Availability of Statutory Remedy SAYED MUHAMMED M vs THE COMMISSIONER OF INCOME TAX 2024 TAXSCAN (HC) 398

A division bench of the Kerala High Court dismissed the writ petition on the availability of a statutory remedy for the issue of unexplained cash deposit under section 69 A of the Income Tax Act, 1961.

The court comprising Dr Justice A K Jayasankaran Nambiar & Dr Justice Kauser Edappagath viewed that the appellant challenged orders mainly on factual grounds, which is in dispute. The disputed question of fact cannot be adjudicated in the writ petition. Further observed that the Single Judge rightly held that the remedy open to the appellant is to approach the Tribunal.

Incriminating Evidence to Prove Commission of Money Laundering Offence under PMLA Act: Delhi HC Dismisses Bail Application DALIP JINDALvs DIRECTORATE OF ENFORCEMENT 2024 TAXSCAN (HC) 400

The Delhi High Court dismissed the bail application since there was incriminating evidence to prove the commission of a money laundering offence under the Prevention of Money Laundering Act, 2002 ( ‘PMLA’ ).

A single bench of Justice Swarana Kanta Sharma observed that “twin conditions under Section 45 of PMLA are not satisfied since the material on record at this stage points out that the applicant herein was involved in the process of acquisition, possession, concealment of proceeds of crime obtained by way of cheating and forgery and projecting the same as untainted, thereby committing an offence of money-laundering under Section 3 of PMLA.”

Cash possessed by an Individual cannot be Forcibly Taken over during Search under CGST Act: Delhi HC  M/S K.M FOOD INFRASTRUCTURE PVT LTD vs THE DIRECTOR GENERAL DGGI 2024 TAXSCAN (HC) 401

The Delhi High Court has held that Cash possessed by an individual cannot be forcibly taken over during a search under the Central Goods and Service Tax ( CGST ) Act, 2017. The petitioners had not handed over the cash to the concerned Officers voluntarily. The CGST Act does not support such action of forcibly taking over the possession of the currency from the premises of any person.

A division bench comprising Justice Sanjeev Sachdeva and Justice Ravinder Dudeja did not find any justification for the resumption of the cash and its continued retention by the respondents. The court allowed the petition with directions to the respondents to forthwith remit the proceeds of the fixed deposit (along with interest) to the bank account of the entities/persons from whose possession the same was resumed during the search conducted on 04.10.2021

GST Proper Officer Fails to Consider Taxpayer’s Detailed Reply: Delhi HC directs Re-adjudication ARROW AIRCRAFT SALES AND CHARTERS PRIVATE LIMITED vs SALES TAX OFFICER CLASS II CITATION:   2024 TAXSCAN (HC) 479

In a major ruling the Delhi High Court has directed re-adjudication after the Goods and Service Tax ( GST ) Proper Officer failed to consider the taxpayer’s detailed reply.

The counsel for the petitioner Mr. Abhishek Garg, submitted that Show Cause Notice dated 24.09.2023 was received by the petitioner to which a detailed point-wise reply was submitted. It was noticed that the order dated 31.12.2023 records that no proper reply/explanation has been received from the tax-payer despite sufficient and repeated opportunities which indicates that the taxpayer has nothing to say in the matter.

The proper officer had to at least consider the reply on merits and then form an opinion whether the explanation was sufficient or not. He merely held that no proper reply/explanation has been received which shows that the proper officer has not even looked at the reply submitted by the petitioner.

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