Supreme Court and High Courts Weekly Round-Up

This weekly round-up analytically summarises the key stories related to the High Courts reported at Taxscan.in during the previous week from October 17 to October 23, 2022.

Syed Sikandar Ali Vs PRINCIPAL COMMISSIONER OF INCOME TAX CITATION: 2022 TAXSCAN (HC) 810

A division bench of the Telangana High Court has held that the execution of a registered sale deed shall be treated as a valid “transfer” within the meaning of Section 2(47)(V) of the Income Tax Act, 1961. Upholding the ITAT order, Chief Justice Ujjal Bhuyan and Justice C.V.Bhaskar Reddy observed that “according to the Tribunal, the appellant had already executed a registered sale deed which is treated as valid transfer under Section 2(47)(V) of the Act. The other documents relied upon by the appellant were only pleadings before civil and criminal courts, which proceedings were yet to attain finality. Accordingly, Tribunal upheld the income tax addition of long-term capital gains made by the assessing officer as confirmed by the CIT(A).”

HAZIRA LNG PVT LTD vs COMMISSIONER OF INCOME TAX-II CITATION: 2022 TAXSCAN (HC) 802

The Gujarat High Court has held that in addition to income is invalid, as the earnings from foreign exchange fluctuations are not in connection with business activity. Chief Justice Aravind Kumar and Justice Ashutosh J. Shastri upheld the view taken by the Tribunal and observed that the findings and conclusions are proper and reasonable and are arrived at by correctly applying the principle of law enunciated in the judicial pronouncements.

Chenna Krishnama Charyulu Karampudi vs Additional Commissioner CITATION: 2022 TAXSCAN (HC) 804

While considering a writ petition where the GST Registration cancelled due to non-filing of GST returns, the Telangana High Court has directed the department to provide an opportunity of hearing as the statutory remedy is not available to the assessee due to the non-establishment of GST Tribunal. A bench of Chief Justice Ujjal Bhuyan and Justice C.V.Bhaskar Reddy observed that “Accordingly and in the light of the above, we set aside the orders dated 05.10.2021 of respondent No.2 as well as the order dated 18.08.2022 of respondent No.1. Matter is remanded back to the file of respondent No.2 to consider the grievance expressed by the petitioner against cancellation of GST registration and thereafter pass an appropriate order in accordance with law.”

RAJA RAM DALMIA vs PRINCIPAL COMMISSIONER OF INCOME TAX CITATION: 2022 TAXSCAN (HC) 807

The Calcutta High Court, has recently, in an appeal filed before it, held that the Department’s power u/s 179, to proceed against the directors is applicable only in cases where tax cannot be recovered from the assessee company. Thus, allowing the assessee’s appeal, the Court ruled: “The impugned garnishee notices issued on the appellant stand quashed as being without jurisdiction. Consequently, the proceedings initiated under section 179 of the Income Tax Act, 1961 are held to be wholly without jurisdiction. The order passed in the writ petition is set aside and the appeal is allowed”.

C.S.T. DELHI vs M/S. SOJITZ CORPORATION CITATION: 2022 TAXSCAN (SC) 187

In a significant case, the Supreme Court held that Service Tax is not leviable on Taxable services received in India from non-residents. The department challenged the judgment and order passed by the Tribunal dismissing the appeals preferred by the Revenue and confirming the order passed by the Commissioner not imposing the penalty on the service tax liability over the assessee,M/s. Sojitz Corporation. A bench consisting of Justice M R Shah and Justice Krishna Murari observed that the service tax liability on any taxable service provided by a non-resident or a person located outside India, to a recipient in India, would arise w.e.f 18-4-2006, i.e., the date of enactment of Section 66A of the Finance Act, 1994.

VPR Engineers limited vs CITATION: 2022 TAXSCAN (HC) 803

A division bench of the Telangana High Court headed by Chief Justice Ujjal Bhuyan, while considering a writ petition has refused to condone a delay of 1546 days in filing an income tax appeal, held that the counsel cannot be blamed for such inordinate delay. Chief Justice Ujjal Bhuyan and Justice C.V.Bhaskar Reddy observed that “it is seen that the appeal which was filed in the year 2016 was returned with office objections. It is stated that the appellant was under the bona fide belief that the appeal papers were resubmitted. Subsequently, when appellant enquired, it was found that the appeal which was returned with objections was not resubmitted by the counsel.”

AHMEDABAD URBAN DEVELOPMENT AUTHORITY vs ASSISTANT COMMISSIONER OF INCOME TAX CITATION: 2022 TAXSCAN (SC) 183

The Supreme Court Division Bench of Chief Justice of India Uday Umesh Lalit, Justice S. Ravindra Bhat and Justice P S Narasimha, while deciding that educational institutions making profits and gains cannot claim Income Tax exemption under Section 10(23C) of the Income Tax Act, 1961, held that, statutory/professional bodies including the Institute of Chartered Accountants of India (ICAI) are eligible for income tax exemption as long as the amounts charged are nominal as to meet the costs of operations and functions.

Tax Bar Association vs State of Maharashtra & Anr. CITATION: 2022 TAXSCAN (HC) 806

The State Government, on Friday, informed the Bombay High Court that the two technical members of Maharashtra Sales Tax Tribunal shall assume charges of their office after Diwali. The Pune Tax Bar Association has filed a Public Interest Litigation before the High Court against the action of the Government delaying the appointment. “In such view of the matter, we direct listing of this PIL petition on 14th November 2022 once again for reporting to this Court whether the said technical members have assumed charge of their respective offices or not,” the Court added.

M/s Shree Enterprises Coal Sales Pvt Ltd vs Union of India & Anr CITATION: 2022 TAXSCAN (SC) 186

In a significant case, the Supreme Court has held that disputes related to tax concessions are not arbitrable. A division bench of Justice Dhananjaya Y Chandrachud and Justice Hima Kohli has observed that the High Court was in error in holding that the terms of e-auction provided that any dispute was arbitrable. It was observed that the appellant was not asserting a contractual claim in pursuance of the e-auction and set aside the impugned judgment order dated 15 March 2018 and remand the proceedings back to the High Court for consideration on merits. The appeal was allowed.

Ashish Agarwal vs Union of India CITATION: 2022 TAXSCAN (HC) 805

A division bench of the Telangana High Court has held that the sufficiency or adequacy of reasons for re-assessment under section 148 of the Income Tax Act, 1961 cannot be decided by invoking writ jurisdiction under Article 226 of the Constitution of India. Dismissing the writ petition, a bench of Chief Justice Ujjal Bhuyan and Justice C.V.Bhaskar Reddy held that “the present is not a fit case to interdict the proceedings at the very threshold. Reasons have been assigned by the assessing officer as to why the explanation given by the petitioner could not be accepted. Certainly, such reasons given have a nexus with the formation of the belief that income chargeable to tax has escaped assessment. It is equally trite that sufficiency or adequacy of reasons cannot begone into in a proceeding under Article 226 of the Constitution of India. That apart, we are at a stage prior to issuance of notice under Section 148 of the Act.”

Agriculture Produce Market Committee vs Income Tax Officer CITATION: 2022 TAXSCAN (HC) 799

The High Court of Bombay Nagpur Bench set aside order under Section 148A(d) of the Income Tax Act, 1961 as reply filed by petitioner was not taken into consideration. The writ petition was filed by Agriculture Produce Market Committee, Khamgaon. A Coram consisting of Justice A S Chandurkar and M W Chandwani observed that “Given the aforesaid facts, we are of the view that the impugned order passed under Section 148A(d) of the Act of 1961 has been issued without considering the petitioner’s reply inasmuch as paragraph 1 of the said order records that the petitioner failed to submit its explanation. In view of aforesaid the impugned order dated 31.03.2022 passed under Section 148A(d) of the Act of 1961 is set aside.”

M/s.S.S.G.Apparels vs The Deputy Assistant Commissioner GST CITATION: 2022 TAXSCAN (HC) 801

The Madras High Court, while allowing a writ petition alleging cancellation of GST registration by mistake while modifying the form, directed to restore the same and asked the GST department to accept the registration manually as the petitioner was not able to apply the same online.

M/S Rc Industries vs Union Of India CITATION: 2022 TAXSCAN (HC) 800

The Allahabad High Court Division Bench of Justice Sunita Agarwal and Justice Vipin Chandra Dixit is to examine whether the Rule 96(10)(b) of the Central Goods and Services Tax (CGST) Rules, 2017 is in ultra vires or within the limits of Section 16(3)(b) of the Integrated Goods and Services Tax (IGST) Act, 2017. The High Court directed the counsels appearing for the respondents to file counter affidavits within two weeks and renotified the matter to be heard on a later date to examine the issue of vires of the Rule 96(10)(b) of the CGST Rules, 2017.

Arun Kumar vs State of Jharkhand through C.B.I. CITATION: 2022 TAXSCAN (HC) 797

Jharkhand High Court imposed 1.5 years imprisonment and fine on Assistant, Income Tax Department for taking bribe of Rs 100. A Single Bench consisting of Justice Gautam Kumar Chaudhary observed that “Taking into account the evidence on record, I am of the considered view that the prosecution has succeeded to prove its case beyond the shadow of all reasonable and probable doubt. Under the circumstance, I do not find any infirmity in the Judgment of conviction passed by the Court below under Section 7 and 13 (2) r/w 13 (1) (d) of the P.C. Act.”

Valecha Investments Pvt. Ltd vs Income Tax Officer CITATION: 2022 TAXSCAN (HC) 794

The Bombay High Court, while considering a bunch of petitions, has held that the failure on the part of the assessee to pay self-assessed income tax cannot be treated as “willful attempt to evade tax” and therefore, nullified the criminal prosecution initiated by the income tax department.
Granting interim relief to the assessee, Justice Amit Borkar observed that “Having considered prima facie the submission on behalf of both the parties, in the light of view rendered by the High Court of Madras wherein it has taken a view that mere default in payment of tax, unless such default arises out of circumstances which has the effect of assessee defeating payment, the expression ‘willful attempt’ cannot be imported to mean failure to pay tax. It is also held in paragraph 10 that mere default in payment of tax “in time”, the willful attempt to evade tax cannot be imported to prosecute an assessee.”

Tvl.Lakshmi Agency vs State Tax Officer CITATION: 2022 TAXSCAN (HC) 793

While considering a writ petition, the Madras High Court has directed the VAT department to follow the instructions in a case relating to the mismatch in the VAT returns. Relying on the circular, Justice Anita Sumanth allowed the petition and held that “Let this procedure be followed in the present matter as well. Show cause notice, as indicated in the Circular will be issued to the petitioner within a period of four (4) weeks from today with all necessary enclosures. The assessments will be completed thereafter within a period of 180 days, in accordance with law, after hearing the petitioner.”

M/S NEW NOBLE EDUCATIONAL SOCIETY vs THE CHIEF COMMISSIONER OF INCOME TAX 1 AND ANR CITATION: 2022 TAXSCAN (SC) 184

The Supreme Court of India, in a significant ruling, held that, where the objective of the institution appears to be profit-oriented, such institutions would not be entitled to approval of exemption under the Section 10(23C) of the Income Tax Act,1961, notably only to be applied prospectively, through the Division Bench of Chief Justice of India Uday Umesh Lalit, Justice S. Ravindra Bhat and Justice P S Narasimha.

RATNAGIRI GAS AND POWER PRIVATE LIMITED vs ASSISTANT COMMISSIONER OF INCOME TAX CIRCLE CITATION: 2022 TAXSCAN (HC) 787

The Delhi High Court set aside the order under section 148A(d) of the Income Tax Act,1961 passed without considering petitioner’s responses being invalid. It was stated that the re-opening is sought on the basis of the change of opinion, which was not permissible. On perusal of the paper book, Justice Manmohan and Justice Manmeet Pritam Singh Arora observed that the petitioner’s responses dated 13th June, 2022, and 30th June, 2022, have not been considered by the AO while passing the impugned order under Section 148A(d) of the Act.

Syed Akeel Shah vs Directorate of Enforcement and another CITATION: 2022 TAXSCAN (HC) 788

In a recent ruling, the Jammu and Kashmir High Court upheld the eviction order of the Enforcement Directorate (ED) in the Arms License Scam. Justice Sanjeev Kumar, dismissed the petition stating that “One may not come across any legislation where the effect and operation of decree, judgment or order are deferred till the expiry of the period of limitation prescribed for filing appeal or revision against the such decree, order or judgment, as the case may be. It is not required to resort to the principles of statutory interpretation to construe and understand the otherwise plain, clear, and unambiguous provisions of Section 8 of the Act of 2002 and Rule 5(2) of the Rules of 2013 whatever be the difficulty and whatever be the consequences.”

SHARAD MEHRA vs SANJAY MEHRA & ORS CITATION: 2022 TAXSCAN (HC) 790

By a recent interim order of a Division Bench of the High Court of Delhi, comprising Justice Najmi Waziri and Justice Vikas Mahajan, the GST Council was impleaded for ascertaining the time required for approval of altered packaging material of the products of S. Schweisstechnik India Ltd. (SSIL), formerly Superon Schweisstechnik India Ltd.

Sodexo India Services Pvt. Ltd vs The Union of India and Ors CITATION: 2022 TAXSCAN (HC) 791

A Division Bench of the Bombay High Court comprising Justice K R Shriram & Justice A S Doctor directed the Central Board of Indirect Taxes and Customs (CBIC) to issue guidelines in regard to pre-deposit through Form Goods & Services Tax (GST) DRC-03 for Service Tax/Excise matters for the lack of provision in law. Without going into the merits of the matter, the High Court Bench directed CBIC, to issue guidelines that resolve the issue of prepayment, and further directed the Commissioner of Appeals, to conduct a rehearing on the merits of the case, after giving due notice.

AHMEDABAD URBAN DEVELOPMENT AUTHORITY vs ASSISTANT COMMISSIONER OF INCOME TAX CITATION: 2022 TAXSCAN (SC) 183

The Supreme Court of India, observed that “Charitable Purposes” under Section 2(15) of the Income Tax Act, 1961 does not include advancement of General Public Utility(GPU) done as business and held that no income tax exemption can be claimed on the same. It was also added by the Apex Court that if the quantum of such profits do not exceed 20% of overall receipts, the prohibition against carrying on of business or service related to business for achieving a General Public Utility object by the charity shall not be attracted, even though a marginal markup over cost or some profit is derived.

VARUN RAKESH BANSAL vs STATE OF GUJARAT CITATION: 2022 TAXSCAN (HC) 789

The Gujarat High Court has recently, while deciding upon an application filedunder section 439 of the Code of Criminal Procedure, granted bail to a GST accused for fraudulently availing input tax credit worth Rs 10.71 crores, in respect of fiction transactions amounting to Rs 59.55 cores. “If breach of any of the above conditions is committed, the Sessions Judge concerned will be free to issue warrant or take appropriate action in the matter. Bail bond to be executed before the lower Court having jurisdiction to try the case.”, concluding its observation the High Court reminded.

ARSHA VIJNANA TRUST vs CENTRAL BOARD OF DIRECT TAXES CITATION: 2022 TAXSCAN (SC) 182

In a recent order, the Supreme Court has directed to erase the personal remarks made against the authors-cum-Founder Chairman of the assessee-trust in the order passed by the Director of Income Tax (Exemptions) denying income tax exemption. “To obviate any doubt, we clarify that the remarks made by the Director of Income Tax (Exemptions), Hyderabad starting from “Against this argument of assessee my observation is that the assessee is himself stating that it is not solely the statement of the object clause which is to be examined but also the nature of the activities undertaken……This is a political ambition disguised as Dharma and claimed as charity. I fail to convince myself to appreciate such acts to be acts of charity as per Income tax Act.” shall be treated as expunged and erased from record,” the Apex Court said.

M/S AGL LOGISTICS PRIVATE LIMITED vs COMMISSIONER OF INCOME TAX (NFAC), DELHI AND ANR CITATION: 2022 TAXSCAN (HC) 785

In a recent incident, an Assessing Officer apologized to the Delhi High Court for an inordinate delay in deciding the stay application due to a delay in handing over the files to the present Assessing Officer. Disposing the petition, the bench observed that “this Court was inclined to order an inquiry by the Principal Commissioner of Income Tax as to why the said file was allegedly not handed over by the previous Assessing Officer to the present Assessing Officer. At this stage, the Assessing Officer expresses unconditional apology as well as regret for not complying with this Court’s order dated 2nd September, 2021. In view of the aforesaid apology, this Court refrains from taking any action against the Assessing Officer. However, he is directed to be more careful in the future.”

CATCHY PROP-BUILD PRIVATE LIMITED vs ASSISTANT COMMISSIONER OF INCOME TAX CITATION: 2022 TAXSCAN (HC) 783

The Delhi High Court, while quashing a pre-consultation notice under the provisions of section 148A of the Income Tax Act, 1961 held that such notice cannot be vague. Quashing the impugned notice, Justice Manmohan and Justice Manmeet Pritam Singh Arora observed that “if the foundational allegation is missing in the notice issued under Section 148A(b) of the Act, the same cannot be incorporated by issuing a supplementary notice.”

EKTARA EXPORTS PVT. LTD vs COMMISSIONER OF CUSTOMS CITATION: 2022 TAXSCAN (SC) 181

A Division Bench of the Supreme Court of India comprising Justice M R Shah and Justice Krishna Murari has recently upheld the order of the High Court of Calcutta, quashing the penalty proceedings initiated under the Customs Act,1962 against the assessee Ektara Exports Pvt. Ltd. The Division Bench of the Calcutta High Court had dismissed the appeal the preferred by the Revenue in not interfering with the order passed by the Customs Excise & Service Tax Appellate Tribunal [for short “the Tribunal”) setting aside the penalty imposed under Section 114(iii) of the Customs Act, the appellant approached the Apex Court with the present Appeal.

NATIONAL DAIRY DEVELOPMENT BOARD vs ADDL. COMMISSIONER OF INCOME TAX CITATION: 2022 TAXSCAN (HC) 784

The Gujarat High Court in a recent ruling in favour of the Income Tax Department, held that dairying is not an industry or agricultural development or development of industrial facility for the purpose of direct taxation under Section 36(1)(ii) of the Income Tax Act, 1961. he Sections 36(1)(iii) and 36(1)(xii) were also analysed by the court for reaching a judicious decision and it was observed that the contention raised by the assessee, National Dairy Development Board cannot be accepted as providing long term finance for various dairy co-operations cannot be covered as long term finance extended for agricultural or industrial development. It was thus held, on the observation made by the bench that the activity of dairy business cannot be construed as agricultural activity, that no deduction or relief can be availed by the assessee.

M/S BAJAJ ALLIANZ GENERAL INSURANCE COMPANY LTD vs COMMISSIONER OF CENTRAL EXCISE CITATION: 2022 TAXSCAN (SC) 180

In a major relief to M/S Bajaj Allianz General Insurance Company Ltd, the Supreme Court has upheld the order of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) wherein the Tribunal deleted the addition of service tax on a premium in terms of the insurance policy covering the future period at revised rates on the entire premium was paid prior to 10.09.2004 i.e. before the change in the rate of tax.

RKR. Gold P. Ltd. vs Assistant Commissioner of Income CITATION: 2022 TAXSCAN (HC) 771

Assumption of jurisdiction by the assessing authority beyond the period of 4 years is not barred by limitation in the absence of full and true disclosure under section 147 of the Income Tax Act,1961, the Madurai bench of the Madras High Court has held as above. Dr Justice AnitaSumanth observed that the criminal investigation wing is separate and distinct from the assessment wing and disclosure made before one wing will not exonerate the petitioner from the requirement of making a ‘full and true disclosure’ before the assessing officer in assessment.

Wavin India Limited vs Sales Tax Appellate Tribunal CITATION: 2022 TAXSCAN (HC) 766

The Madras High Court Bench directed to re-examine matter of assessment in respect of turnover thereby granting to M/s. Wavin India Limited. The petition under Article 226 of the Constitution of India was filed praying for issue of a Writ of Certiorarified Mandamus to call for the records and quash the same as invalid and illegal, and without jurisdiction and further directing to pass orders on merits under Section 6-A of the Central Sales Tax Act, 1956. A Division Bench consisting of Justice S Vaidyanathan and C Saravanan held that “The Appellate Tribunal is the ultimate fact-finding authority. Therefore, it was incumbent on the part of the Appellate Tribunal to have examined the claim based on the additional documents/evidence in the light of the law settled by the Kerala High Court in M.SyedAlavi and Others vs. State of Kerala, followed by this Court inState of Tamil Nadu vs. Sharada Enterprises.”

Dipali Electronics Pvt. Ltd vs The Union of India and anr. CITATION: 2022 TAXSCAN (HC) 758

The Bombay High Court has ruled that, CESTAT must ensure that notice was properly served to parties before passing the order. Dipali Electronics Pvt. Ltd, the petitioner engaged in the manufacture and selling of various electrical/electronic goods which used to be sold to various domestic buyers and held a small-scale industries license in Daman. Justice K R Shriram & Justice A S Doctor observed that “if a party does not turn up, it is not possible for CESTAT to go through the entire Appeal of the party, consider the grounds and pass a detailed order. At the same time, the CESTAT ought to have checked if a party has been properly served before proceeding to hear the matter and pass the order.”

Hindustan Unilever Limited vs The Union of India and Ors CITATION: 2022 TAXSCAN (HC) 782

A Division Bench of the Bombay HC comprising Justice K R Shriram and Justice A S Doctor held that Bills of Entry can be amended by submission of documents used for customs clearance and permitted the petitioner, Hindustan Unilever Limited to amend the bills submitted under Section 149 of the Customs Act, 1962. The Court, upon perusal of the impugned order and documentary evidence submitted by the petitioner, observed that, if the goods have been cleared for home consumption, which in this case has been, the proper officer has to only consider the documentary evidence which was in existence at the time the goods were cleared and nothing more. There is nothing to indicate in the impugned order that petitioner had not submitted the documentary evidence which was in existence at the time the goods were cleared.

DEPUTY COMMISSIONER OF GIFT TAX vs M/S BPL LIMITED CITATION: 2022 TAXSCAN (SC) 179

The Supreme Court of India, in a recent ruling, has held that the valuation of shares shall be done taking into consideration the restrictions and limitations on transfer of said shares. The issue raised in these appeals relates to the valuation of 29,46,500 shares of M/s. BPL Sanyo Technologies Limited and 69,49,900 shares of M/s. BPL Sanyo Utilities and Appliances Limited, which were gifted by the respondent-assessee, M/s. BPL Limited. The Division Bench of Justice Sanjiv Khanna and Justice J K Maheshwari dismissed the appeal of the Revenue. The provisions of the Gift Tax Act, 1958 was discussed at length along with the Wealth Tax Act, 1957.
THE PRINCIPAL COMMISSIONER OF INCOME TAX vs LAVJIBHAI SWARUPCHAND MEHTA CITATION: 2022 TAXSCAN (HC) 781
A Division Bench of the Gujarat High Court comprising the Chief Justice Aravind Kumar and Justice Ashutosh J Shastri condoned the delay of the revenue in filing appeal on grounds of filing of rectification of applications amounting to reasonable cause. An application was filed by the Revenue seeking condonation of delay of 474 days in preferring the Appeal under section 260A of the Income Tax Act, 1961, in the case of Principal Commissioner of Income Tax, Ahmedabad v. Lavjibhai Swarupchand Mehta.
VIKRANT ANTHONY JOSEPH vs INCOME TAX OFFICER CITATION: 2022 TAXSCAN (HC) 779
A division bench of the Gujarat High Court has held that the income tax assessment/re-assessment against a dead person merely as procedural irregularity but it is also a jurisdictional defect. Quashing the impugned order, Justice N.V.Anjaria and Justice Bhargav D. Karia held that “the attempt on the part of the income tax authorities to start proceedings for assessment or re-assessment against the dead person is viewed not merely as procedural irregularity but it is stated as jurisdictional defect.”
Tax Bar Association vs State of Maharashtra and Anr CITATION: 2022 TAXSCAN (HC) 780
The State Government of Maharashtra, on Thursday has informed the Bombay High Court that the appointment of the Judicial Members of the Maharashtra Sales Tax Tribunal is expected very soon. The Pune Tax Bar Association has filed a Public Interest Litigation before the High Court against the action of the Government delaying the appointment. A division bench comprising Chief Justice Dipankar Datta and Justice Madhav J. Jamdar listed the matter to 20th October 2022 “high on board” and observed that “Mr. Sonpal, learned special counsel for the State assures the Court that a positive decision on appointment of the Judicial Members of the Maharashtra Sales Tax Tribunal is expected very soon and that he would be in a position to apprise the Court about the developments on 20th October 2022.”
Commercial Taxes Officer vs M/s Rahul Remedies CITATION: 2022 TAXSCAN (HC) 778
A division bench of the Rajasthan High Court has issued a notice to the Commercial Tax Officer while admitting an appeal regarding the taxability of the products Kesh King Oil/Capsule, More Power Capsule, Rajsee Capsule, Memory Mantra Capsule/Syrup, Roop Mantra Capsule etc. under the Rajasthan VAT Act. Earlier, the Tax Board allowed relief to the assessee by holding that the product sold by the assesseei.e. Kesh King Oil/Capsule, More Power Capsule, Rajsee Capsule, Memory Mantra Capsule/Syrup, Roop Mantra Capsule etc. would fall under Entry 43 of Schedule IV of RVAT Act and taxable @ 5%.
Lakha Ram vs The Union of India and Anr CITATION: 2022 TAXSCAN (HC) 776
A division bench of the Bombay High Court, while allowing a plea of the taxpayer aggrieved by the non-consideration of reply to the show-cause notice, has quashed the order and directed the GST department to re-do the adjudication process. Granting relief to the assessee, Justices of K.R. Shriram & A.S. Doctor commented that “this is one more case where respondents have passed such order without applying its mind and without considering the records.”
M/S NTT DATA GLOBAL DELIVERY SERVICES LTD vs PR. COMMISSIONER OF INCOME TAX CITATION: 2022 TAXSCAN (HC) 775
The Delhi High Court held that incidental income in form of interest income, eligible for deduction under Section 10A of the Income Tax Act, 1961. The Income Tax Appeal has been filed challenging the order passed by the Income Tax Appellate Tribunal for the Assessment Year 2009-10. The appellant in the appeal is Principal Commissioner of Income Tax (Pr CIT), Bengaluru. A Division bench consisting of Justice Manmohan and Justice Manmeet Pritam Singh Arora relied on the judgment in Principal Commissioner of Income Tax-1 vs. American Express India Pvt. Ltd, wherein it was held that ““Section 10A/10B of the Act is a complete code providing the mechanism for computing the „profits of the business‟ eligible for deduction u/s 10B of the Act. Once an income forms part of the business of the income of the eligible undertaking of the assessee, the same cannot be excluded from the eligible profits for the purpose of computing deduction u/s 10B of the Act.”
M/S DELHI INTERNATIONAL AIRPORT PVT. LTD vs PRINCIPAL COMMISSIONER OF INCOME TAX CITATION: 2022 TAXSCAN (HC) 774
The Delhi High Court allowed interest expenses of Rupees Ten Crores there by granting relief to the Delhi International Airport. The Income Tax Appeal has been filed by the Principal Commissioner of Income Tax challenging the order passed by the Income Tax Appellate Tribunal (‘ITAT’) for the Assessment Year 2010-11. Dismissing the appeal, a Division Bench consisting of Justice Manmohan and Justice Manmeet Pritam Singh Arora observed that “In the opinion of this Court, the present case is covered by the Division Bench judgment in Cheminvest Ltd. vs. CIT, wherein this Court has held that the expression ‘does not form part of the total income’ in Section 14A of the Act means that there should be an actual receipt of income which is not includible in the total income, during the relevant previous year for the purpose of disallowing any expenditure incurred in relation to the said income. In other words, Section 14A will not apply if no exempt income is received or receivable during the relevant previous year.”
V.V.V. & Sons Edible Oils Ltd. vs Joint Commissioner CITATION: 2022 TAXSCAN (HC) 770
The Madurai bench of the Madras High Court has held that the commissioner has no power to delegate the power on passing orders to any lower authority under section 64(4) of the TNVAT Act,2006. M/s. V.V.V. & Sons Edible Oils Ltd filed the petition against the order passed by the Single Judge allowing the writ petition, but granting liberty to the Commissioner (CT) Chennai, to delegate the power to an Officer, not below the rank of Deputy Commissioner (CT) and to conduct the enquiry. While allowing the writ appeal, the bench directed the Commissioner to exercise his powers under Section 64(4) of the Act, after giving an opportunity to the appellant. Mr S.Raja Jeya Chandra Paul appeared on behalf of the appellant and Mr R. Baskaran appeared on behalf of the respondent.
Asia (Chennai) Engineering Vs Assistant Commissioner (ST) (FAC) CITATION: 2022 TAXSCAN (HC) 773
In a significant ruling, the Madras High Court has held that the filing of a reply to the show-cause notice in form GST-DRC-06 is not mandatory under Section 73(9), 74(9) and 76(3) of GST Act and the reply so filed through post shall also be treated as valid. The petitioner, Asia (Chennai) Engineering Company Private Limited, sent physical representation on 08.01.2022 received by them on 10.01.2022. The petitioner denied the opportunity of hearing to the petitioner. Noting that the department ought to have referred to it and considered the same and thereafter given the petitioner an opportunity to give his explanation, Justice M. Nirmal Kumar observed that “In view of non-consideration, the petitioner denied his right of opportunity, and principles of natural justice.”
M/s.V V Titanium Pigments Private Limited vs The Assistant Commissioner of Income Tax CITATION: 2022 TAXSCAN (HC) 772

The Madurai bench of the Madras High Court commissioner has ruled that a stay order made u/S 220 (6) of the Income Tax,1961 must be a speaking order. Justice Mohammed Shaffiq held that “the impugned order is cryptic and non-speaking and thus contrary to the above order of this Court and the various instructions. Given the same, the impugned order dated 22.06.2021 is set aside and the matter is remanded back to the Respondent to reconsider the application for a stay under Section 220(6) of the Act on merits and pass a speaking order within a period of eight weeks from the date of receipt of a copy of this order after granting the reasonable opportunity to the Petitioner. The writ petition stands disposed of.”
M/S HERO MOTOCORP LTD. vs UNION OF INDIA & ORS CITATION: 2022 TAXSCAN (SC) 178
The Supreme Court, on Monday, rejected the plea of Hero Motorcorp Ltd wherein the Company pleaded to allow 100% Budgetary Support after the enactment of GST. While dismissing the plea, Justice B.R. Gavai and Justice B.V. Nagarathna directed the State Governments and the GST Council to consider such representations, if made, in accordance with what has been observed herein above in an expeditious manner.
M/S L G CHAUDHARY vs UNION OF INDIA CITATION: 2022 TAXSCAN (HC) 768
A division bench of the Gujarat High Court has held that the benefit of the amnesty scheme Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 cannot be denied to the assessee when the attempt to make the payment was failed due to technical issues. Allowing relief to the assessee, the Court held that “In view of the above, this petition is allowed and the respondent authorities are directed to accept the payment of Rs. 38,64,256/- as specified in SVLDRS-3 dated 16.03.2020 along with interest @ 9% per annum from 30.06.2020 till the date of payment and grant the benefit of the Scheme to the petitioner. The petitioner shall deposit the said amount with interest on or before 15.11.2022. As a consequence, the impugned order in-original dated 04.01.2021 passed by respondent No.3 is quashed and set aside so as to grant benefit of the Scheme to the petitioner. Rule is made absolute to the aforesaid extent.”
SECURITIES AND EXCHANGE BOARD OF INDIA vs NATIONAL STOCK EXCHANGE MEMBERS ASSOCIATION AND ANR CITATION: 2022 TAXSCAN (SC) 177
The Supreme Court, in a recent ruling, has held that, stockbrokers not only have to obtain a separate certificate of registration from SEBI for each stock exchange where he operates, at the same time, has to pay ad valorem fee prescribed, allowing appeal of the Securities and Exchange Board of India (SEBI). The appeal was directed against the judgment and order dated 7th November, 2005 passed by the Division Bench of the High Court of Delhi that set aside the Single Bench’s findings. The Division Bench had arrived at a conclusion that a single registration with the Securities and Exchange Board of India (hereinafter referred to as “SEBI”) is sufficient even if the stock broker has various memberships and functions from several stock exchanges and, therefore, will have to pay the fee for the initial registration with SEBI.
M/s Commercial Engineers and Body BuildingCompany Limited vs The State of Madhya Pradesh and Another CITATION: 2022 TAXSCAN (SC) 176
In a recent ruling, a two-judge bench of the Supreme Court has quashed an order of the Madhya Pradesh High Court wherein the High Court set aside an assessment order passed by the department denying input rebate to the assessee under the VAT Act. The bench comprising Justice Krishna Murari and Justice M R Shah has held that the High Court cannot entertain its writ jurisdiction to quash an assessment order on merits as the assessee has an alternative statutory remedy available under the Madhya Pradesh Value Added Tax Act, 2002.
SWASTIK PLASTICS vs COMMISSIONER OF DGST CITATION: 2022 TAXSCAN (HC) 764
In a significant ruling, the Delhi High Court has recently quashed a GST assessment order passed by an investigating order who carried out the search proceedings for want of jurisdiction and directed the Revenue to re-adjudicate the proceedings. Quashing the impugned order, Justice Rajiv Shakdher and Justice Tara VitastaGanju held that “the petitioner, in this case, had raised an issue concerning jurisdiction, right at the very outset. In these circumstances, we are of the view, that the respondent/revenue will have to commence de novo proceedings, bearing in mind the modification Guidelines given in the aforementioned Circular i.e., the Circular dated 20.09.2022. Accordingly, the impugned order dated 11.03.2022 is set aside. The logical sequitur would be, that a fresh show cause notice will have to be issued, bearing in mind the aforementioned Circular dated 20.09.2022.”

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