This weekly round-up analytically summarizes the key stories related to the Supreme Court and High Court reported at Taxscan.in from May 04th, 2024 to May 10th, 2024.
SUPREME COURT
The Supreme Court upheld the National Company Law Appellate Tribunal ( NCLAT ) order affirming that amounts covered by security deposits under agreements constitute financial debt. Justices Abhay S. Oka and Pankaj Mithal held in alignment with NCLAT’s perspective, recognizing these deposits as financial debt under sub-section (7) of Section 5 of the Insolvency and Bankruptcy Code ( IBC ), thereby designating the depositor as a financial creditor.
The bench held that the view taken by the NCLAT under the impugned judgments and orders is correct and has to be upheld. Therefore, confirming the impugned judgments, the apex court dismissed the appeals with no order as to costs.
The Supreme Court refused to entertain a petition submitted by Micro and Small Enterprises ( MSEs ) challenging the 45-day payment rule outlined in Section 43B(h) of the Income Tax Act, during its session on Monday (May 6).
The Supreme Court granted interim bail to Delhi Chief Minister Arvind Kejriwal from today until June 1 in connection with a money laundering case linked to the alleged Delhi excise policy scam. He has been directed to surrender to prison authorities by June 2. The bench indicated that they will soon issue a detailed order on this matter.
HIGH COURTS
The Kerala High Court recently held that the assessing authority adjudicating issue afresh on remand from the Appellate Authority, cannot ignore time limit under the Income Tax Act, 1961.
The bench observed that the time limit specified in Section 153(2A) of the Income Tax Act is also intended to ensure that amounts due to the Government, if any, are received at the earliest point in time after the remand.
The Kerala High Court directed to file appeal manually before the Appellate Authority as payment was not reflected in the Central Excise Portal, observing that interest of justice will be served by permitting the petitioner to file an appeal manually before the Appellate Authority together with 10% of the amount required to be paid by the petitioner after giving credit to the sum of Rs.54,70,716/- , which has already been paid by the petitioner.
The Kerala High Court quashed the assessment order under the Goods and Service Tax Act, 2017 (GST Act) for not following procedure for compounding scheme.
The bench observed that, without there being an order rejecting the application of the petitioner, notice under Section 73 has been issued and this case is a complete violation of the Scheme of the Act. The court directed to file a reply to the show cause notice for rejection of the application under the composition scheme within a period of ten days.
The Kerala High Court directed the Faceless Appellate Centre (FAC) to consider appeal as the rectification form 26AS was issued by the bank.
The court noted that the Bank has already modified Form 26 AS and letter has been issued which would suggest that no TDS was deposited by the Bank and no interest income accrued to the petitioner, The court disposed the writ petition with direction to the Faceless Appellate Centre to consider and dispose of appeal of the petitioner expeditiously, preferably within period of two months.
The Kerala High Court dismissed review petition in the matter regarding the remission of GST as per time extended for filing return by the bar attached hotels.
The review petition has been filed seeking review of the Judgment and Order passed in the batch of writ petitions. The Court held that in cases where the return was filed on or before 31.03.2022 and turnover tax was cleared on or before 30.04.2022 by the FL3 license, for the period from 22.05.2020 to 21.12.2020 and from 15.06.2021 to 25.09.2021 for the financial years 2020-21 and 2021-22, they would not be liable to pay interest for delayed filing of the returns and payment of turnover tax @ 5% on their parcel sales authorized by the Government during the Covid lock down period.
The Kerala High Court ordered the demands to be stayed until the stay petition is disposed of as the appeal against the assessment order was passed under the Income Tax Act, 1961. The bench directed that any demands in terms of the assessment order shall not be enforced till a decision is taken on the stay petition by the 2nd respondent.
The Bombay High Court in a ruling in favour of Tata Steel limited held that a contribution of Rs. 212.52 Crores to the Compensatory Afforestation Fund (“CAF”) amounts to Revenue Expenditure. The court dismissed the Appeal. Mr. Suresh Kumar appeared for Appellant and Mr. Nishant Thakkar, Ms. Jasmin Amalsadvala & Mr. Bhavesh Bhatia appeared for Respondent assessee.
The Rajasthan High Court accepts the appeal on the issue of credit on input in stock when the final product is exemplified. The court issued a notice of admission of appeal to the respondents on payment of PF within one week, returnable within four weeks. The court issued notice of admission of appeal to the respondents on payment of PF within one week, returnable within four weeks.
The Kerala High Court directed the State Tax Officer to pass orders in the matter relating to filing of Form 21CC refund application as per the Kerala Value Added Tax (KVAT) Appellate Tribunal. The court directed the 1st respondent to consider and pass order on the application of the petitioner, expeditiously, in accordance with the law, preferably within a period of one month.
The Kerala High Court has eased the burden on taxpayers by permitting installment payments for motor vehicle tax arrears. The case involved a petitioner, who sought relief from the Regional Transport Officer ( RTO ) regarding outstanding motor vehicle tax for his stage carriage bearing registration number KL-02-U-4839.
The court disposed of the Writ Petition and directed the petitioner to discharge the tax liability on the goods carriage vehicle in six equal monthly installments.
The Kerala High Court has intervened to halt recovery proceedings initiated against Artisans Development Cooperative Ltd ( ARTCO Ltd ), a Kerala-based cooperative, and directed the concerned authorities to consider the company’s stay application within two months. The decision came in response to a writ petition filed by ARTCO Ltd challenging an assessment order issued by the Income Tax department.
The court halts recovery proceedings against the petitioner and directs the respondent revenue to expedite the consideration of the stay application.
The Kerala High Court dismissed the review petition in the absence of error apparent on face of record in the matter relating to the payment of interest for delayed filing of GST returns.
The court held that in cases where the return were filed by the FL3 licensees, for the period from 22.05.2020 to 21.12.2020 and from 15.06.2021 to 25.09.2021 for the financial years 2020-21 and 2021-22, they would not be liable to pay interest for delayed filing of the returns and payment of turnover tax @ 5% on their parcel sales authorised by the Government during the Covid lock down period.
The Delhi High Court directed readjudication with respect to the order passed under Section 73 of the Central Goods and Services Tax Act, 2017 on account of failure to follow the natural justice principle. The writ petition was filed by the petitioner Dish TV India Ltd. against the demand created under Section 73 of the Central Goods and Services Tax Act.
The bench directed readjudication with respect to the order passed under Section 73 of the Central Goods and Services Tax Act, 2017 on account of failure to follow the natural justice principle.
The Delhi High Court quashed rejection of refund application of intra state supply services without considering the circular relating to the limitation. Therefore the division bench observed that the refund applications filed by the petitioner are covered by the circular dated 25.09.2021 and were within limitation.
The Delhi High Court modified the retrospectively canceled Goods and Service Tax ( GST ) registration from the date of issue of a Show Cause Notice ( SCN ). The writ petition was filed by the petitioner Ansh Telecom against the retrospectively canceled GST registration .The Petitioner was engaged in the business of trading mobile phones and tablets and possessed GST Registration under the Central Goods and Services Tax Act, 2017 .
The court observed that the notice that Show Cause Notice and the impugned order are also bereft of any details. Accordingly, the same cannot be sustained. Neither the Show Cause Notice, nor the order spell out the reasons for retrospective cancellation.
The Delhi High Court while directing to consider the refund application observed that Show Cause Notice ( SCN ) issued by the incompetent authority with respect to the refund application filed by the petitioner.
The court held that the course adopted by the Appellate Authority is not acceptable in law, the impugned order is set aside to the extent that it decides the claim of the petitioner on merits.
In a significant case, the Delhi High Court quashed the order passed under Section 148(A)(d) of Income Tax Act and observed that the reassessment proceedings of the assessment year 2015-16 had already concluded.
The bench observed that assessment under Section 147 of the Income Tax Act was already concluded, saying proceedings were completely ignored and no new material was unearthed. Therefore the Court quashed the order passed under Section 148(A)(d) of Income Tax Act .
The Delhi High Court directed the proper Officer to consider the application of refund of Rs 44,94,004/-within a period of four weeks besides interest on delayed refunds.
The writ petition was filed by the petitioner Deep Jyoti Exports Pvt. Ltd by directing the respondents to grant a refund besides interest for the delayed refund. As per the Petitioner, the application seeking refund is still pending and has not been disposed of the refund pertains to the period August 2020 to January 2021, amounting to Rs. 44,94,004/.
The Delhi High Court while directing to pass an appropriate order in terms of Section 56 of the Central Goods & Service Tax Act, 2017 with regard to payment of interest on the delayed refund directed the proper Officer to consider the application of refund within a period of four weeks.
The bench disposed of this petition while observing the application seeking refund is still pending, Further directing the proper Officer to consider the application in accordance with law and dispose of the same within a period of four weeks from today.
The Delhi High Court directed the proper Officer to consider the application of refund within a period of four weeks . Further directed to pass an appropriate order in terms of Section 56 of the Central Goods & Service Tax Act, 2017 with regard to payment of interest on the delayed refund. The bench allowed the writ petition by directing it to consider the application of refund within a period of four weeks .
The Gujarat High Court held that export of mango pulp should attract 12% Goods and Service Tax ( GST ). Thus the petitioners would be liable to pay GST at the rate of 12% from 1st July 2017 on the product “mango pulp” and not at the rate of 5% ( as claimed by the petitioners ) or 18% (as claimed by the respondents) for the period from 01.07 2017 to 18.07.2022. The court observed that the GST Council has clarified in its 47th meeting that tax rate would continue to apply at 12% other than “mango sliced, dried” for which the GST rate was reduced to 5% as per the recommendations of 27th meeting of the GST Council.
The Kerala High Court in a recent decision held that the High Court is not an appellate authority under the Kerala Goods and Service Tax Act, 2017 ( KGST Act ) to examine the merit of assessment/refund order. The observed that “If the petitioner is aggrieved by the said order, the remedy lies elsewhere under the Statute itself. This Court cannot enter into the factual dispute as it is for the petitioner to approach the Appellate Authority against the said order if he is not satisfied with the order passed for refund in the impugned order. This court is not an appellate authority under the provisions of the KGST Act to examine the merit of the assessment/refund order.”
The Kerala High Court quashed the review petition in the matter regarding the payment of turnover tax @ 5% on parcel sales authorised by the Government during Covid lock down. The court observed that review jurisdiction is to be exercised in a very limited manner where there is error apparent on the face of the record.
The Kerala High Court directed the GST Commissioner to pass orders as there was delay in filing rectification application due to delayed receipt of assessment order. The court observed that the order was received only on, the respondent is directed to consider and pass orders on the application for rectification as expeditiously as possible and at any rate within six weeks from the date of receipt of a copy of this Judgment, after affording an opportunity of hearing to the petitioner.
The Kerala High Court quashed re-assessment order under the Income Tax Act, 1961 in the matter regarding the denial of virtual hearing on ground that it was not in prescribed form. The court observed that the form in which the virtual hearing has to be subscribed is a matter of procedure and not a substantive law. The procedure is always handmade for doing the complete justice between the parties. Procedure cannot take away the substantive right of a person, if the person is otherwise eligible for substantive right of personal hearing.
The writ petition is allowed and the impugned order is set aside and the matter is remanded back to the 2nd respondent to issue fresh notice to the petitioner for availing the opportunity of personal hearing.
The Bombay High Court held that the sanctioning authority should be the Principal Chief Commissioner of Income Tax ( PCCIT ) for issuing reopening notice after expiry of 3 years. The court noted that the impugned order and the impugned notice both dated 20th July 2022 state that the Authority that has accorded the sanction is the PCIT-27, Mumbai. The matter pertains to Assessment Year (AY) 2017-2018 and since the impugned order as well as the notice are issued on 20th July 2022, both have been issued beyond a period of three years. Therefore, the sanctioning authority has to be the PCCIT as provided under Section 151(ii) of the Act.
The Delhi High Court has set aside the Competition Commission of India’s (CCI’s) order, stating that failure to adhere to notice provisions incurs liability for penal interest. The bench noted that there being no notice of demand, it was held that the liability to pay penal interest did not arise. It is necessary to emphasize that this was not a case of payment of interest at the ordinary statutory rate but a case of penal interest and therefore, that the Act provided that the liability to pay the same arises only after there has been a failure to comply with the provisions of a notice on that behalf.
The Bombay High Court allowed the petition by directing the Joint Commissioner of Income Tax ( JCIT ) to supply a copy of certificate of exemption under Section 12 A of Income Tax Act, 1961. The bench allowed the petition by directing the respondents to supply a copy of a certificate of exemption under Section 12A of the Income Tax Act to the petitioner/Trust and to also accord all benefits arising therefrom to it. Accordingly, the petition was accordingly allowed.
The Punjab and Haryana High Court has issued an interim order staying a circular issued by the Central Board of Indirect Taxes and Customs (CBIC) concerning the tax treatment of corporate guarantees exchanged between related parties. The bench granted an interim stay on the effect and operation of Item No.2 of the impugned Circular dated October 27, 2023.
The Madras High Court allowed the petitioner to contest the Goods and Services Tax ( GST ) demand on pre-deposit condition in the matter where the petitioner failed to respond to the Show Cause Notice ( SCN ) and attend the personal hearing on grounds of diagnosis of cancer. The court observed that the tax proposal had been confirmed solely on grounds of the petitioner’s non-response and absence at the personal hearing. Considering the petitioner’s medical condition and the principles of justice, the court deemed it appropriate to afford the petitioner a chance to present their case.
The Madras High Court set aside the Goods and Services Tax (GST) demand order issued completely on a different basis from the Show Cause Notice (SCN). The court ordered fresh proceedings. The court addressed a significant disparity between a tax order and the initial show cause notice, leading to the decision’s annulment.
The court emphasized that if the tax authority intended to amend the tax assessment following the petitioner’s response, issuing a fresh show cause notice was imperative.
The Madras High Court ordered the customs department to provide the certified copy of order in original rejecting the Department’s plea of previous service.The court emphasised the importance of transparency and access to legal documents. It noted that even if a certified copy had been previously served, the respondents could easily verify and provide evidence of such service. Hence, there was no impediment to furnishing another copy to the petitioner.
The Calcutta High Court has ruled that the onus of inquiry regarding non-remittance of Goods and Services Tax ( GST ) to the state treasury falls upon the seller, particularly in cases where the service recipient has already fulfilled their payment obligations unless in exceptional circumstances as clarified in the press release issued by Central Board of Indirect Taxes and Customs ( CBIC ). The bench observed that the authority acknowledged the payment of tax by the appellant to the supplier, but noted that it hadn’t been remitted to the state exchequer. In such a scenario, the elementary principle dictates that the authority should conduct an inquiry with the supplier before penalising the appellant. Failing to do so would be arbitrary, illegal, and without jurisdiction.
The Madras High Court overturned an appellate order and directed the Deputy Commissioner ( ST ) ( GST ) (Appeals) to adjudicate the appeal, despite a delay of 21 days in its filing. The court’s decision came in response to the petitioner’s contention that the GST proposal had been confirmed under Section 74 of the Goods and Services Tax ( GST ) Act without fulfilling the necessary criteria stipulated by the section.
The court set aside the appellate order and directed the 2nd respondent – Deputy Commissioner (ST)(GST)(Appeals) to receive and adjudicate the appeal filed by the petitioner on its merits, without delving into the question of limitation.
The Madras High Court directed the 10% pre-deposit condition for challenging the order where the petitioner lacked Goods and Services Tax ( GST ) proceedings on discrepancy between GSTR 3B and GSTR 2A as notices uploaded in Additional Notices and Orders Tab of GST portal. The court recognized the gravity of the situation, emphasising the necessity of affording the petitioner an opportunity to contest the tax demand. It was noted that the tax proposal was confirmed due to the petitioner’s failure to respond to the show cause notice. The petitioner was granted the opportunity to submit a reply to the show cause notice within the specified period and the respondent was directed to provide a reasonable opportunity, including a personal hearing, and issue a fresh order within three months from the receipt of the petitioner’s reply.
The Madras High Court remanded the Goods and Services Tax ( GST ) demand for reconsideration on 10% pre-deposit condition as rectification was filed on error in reporting outward supplies and Input Tax Credit (ITC). The court noted that the tax proposal was confirmed due to the petitioner’s failure to file objections to the show cause notice or attend a personal hearing. In light of the rectification made by the petitioner, the court deemed it just to remand the matter for reconsideration, subject to the condition of remitting 10% of the disputed tax demand within two weeks from the receipt of the court’s order.
The Madras High Court set aside the order confirming Goods and Services Tax ( GST ) liability on non-response to Show Cause Notice ( SCN ) as the petitioner was not aware about the proceedings due to complete bed rest on advice of doctor. The court observed that the tax proposals arose from discrepancies between the petitioners’ GSTR 3B returns and Form 26AS. The proposals were confirmed due to the petitioners’ failure to respond to the show cause notices. However, considering the contention regarding exemptions and the circumstances leading to the petitioner’s inability to contest the tax demands, the court deemed it just and necessary to provide them with an opportunity to do so.
The Madras High Court allowed the petitioner to contest the Goods and Services Tax ( GST ) Liability on a pre-deposit of 10% of disputed tax demand. The bench observed that the liability was confirmed due to non-response to Show Cause Notice ( SCN ) as it was uploaded in the GST portal. The court set aside the impugned orders and directed the petitioner to submit replies to the show cause notices within two weeks. The respondent was instructed to provide a reasonable opportunity for a personal hearing and issue fresh orders within three months of receiving the petitioner’s replies.
The Madras High Court observed that the retrospective date to apply for the Settlement before the Interim Board for Settlement under Section 245C(5) of Income Tax Act, 1961 shall be March 31, 2021 and not 1st February 2021. The bench had ruled that applications for cases arising between 01.02.2021 and 31.03.2021 should be deemed pending. This decision was reiterated in a subsequent judgment of the Division Bench in Ashwini Fisheries Pvt. Ltd. v. Principal Commissioner of Income Tax and Ors., dated 26.03.2024. The Board was directed to expedite the proceedings, preferably within three months from the date of receiving the Court’s order.
The Madras High Court granted the petitioner the opportunity to contest a Goods and Services Tax ( GST ) demand, provided they make a 10% pre-deposit. This decision arised from a situation where the petitioner’s accountant overlooked GST notices uploaded in the “view additional notices and orders” tab on the GST portal. The bench set aside the impugned order dated 31.07.2023 on the condition that the petitioner remits 10% of the disputed tax demand within two weeks from the date of receipt of the court’s order.
The Madras High Court has granted another opportunity to the petitioner to explain the unreconciled turnover as they possess relevant documents on a pre-deposit condition of Rs. 50 lakhs. The court observed that the tax proposal concerns unreconciled turnover, noting the absence of response to the show cause notice. Recognizing the petitioner’s claim of possessing relevant documents on unreconciled turnover, the court deemed it just to afford another opportunity, albeit with conditions, considering the petitioner’s prior non-engagement. The petitioner was permitted to submit a reply to the show cause notice within the same period, enclosing all relevant documents.
The Madras High Court sets aside the Goods and Services Tax ( GST ) demand order issued on the same date of issuance of Show Cause Notice ( SCN ). Further directed the Assistant Commissioner (ST) to initiate proceedings in accordance with law. The court found merit in the contention that a reasonable opportunity was not provided due to the concurrent issuance of the SCN and the impugned order. Consequently, the Court deemed the impugned order unsustainable.
The Madras High Court directed the Goods and Services Tax ( GST ) department to dispose of the Rectification Petition within 1 Month as the petitioner correctly submitted the reconciled GSTR 2A and GSTR 3B. The bench disposed of the writ petition by instructing the respondent to consider and dispose of the rectification petition dated March 12, 2024, through a comprehensive order. The respondent has been directed to provide a reasonable opportunity, including a personal hearing, to the petitioner within 1 month.
The Delhi High Court has quashed a Customs Circular and Show Cause Notice ( SCN ) that imposed restrictions on the establishment of Solar Power Plants under the Manufacturing and Other Operations in Warehouse (MOOWR) License as per Section 65 of the Customs Act. The court observed that the activities undertaken by the writ petitioners are in aid of the objective of the country transitioning towards renewable energy sources so as to meet the targets of switching to a cleaner energy source. It was remarked that, the construction of a statute cannot be guided or influenced by the subsequent experience of the executive or of discerned inequitable results.
The Delhi High Court has dismissed a plea seeking the postponement of the Chartered Accountancy ( CA ) Intermediate and Final Examinations amidst concerns over the potential clashes with the upcoming Lok Sabha General Elections. The court ruled against rescheduling the exams, emphasising the need to maintain the integrity of the examination schedule despite individual hardships faced by some candidates.
The Madras High Court has set aside a Goods and Services Tax ( GST ) demand order, specifically addressing a discrepancy in Reverse Charge Mechanism ( RCM ) liability. The court took into account the petitioner’s argument regarding inadvertent errors in filing GSTR 3B returns, prompting a remand of the matter for further consideration. The court instructed the first respondent- Deputy State Tax Officer to provide a reasonable opportunity to the petitioner, including a personal hearing, and issue a fresh order within three months from the receipt of the petitioner’s reply. It was clarified that the amounts appropriated in relation to the RCM liability mismatch would abide by the outcome of the remand.
The Delhi High Court has ruled that proceedings or prosecution under the Prevention of Money Laundering Act ( PMLA ) cannot be sustained if the accused has been acquitted in the predicate offence. The court also directed the release of attached properties on the observation that the offence of money laundering is dependent on the proceeds of crime generated from a scheduled offence. The division bench asserted that the continuation of PMLA proceedings against the petitioner was legally untenable and also held that there is no infirmity in the order issued by the Special Judge whereby the attached movable and immovable properties were directed to be released.
The judgment stressed the fundamental principle of legal jurisprudence that no person should be subjected to double jeopardy. It sets an important precedent that will guide future cases involving the interpretation of laws related to financial crimes.
The Allahabad High Court held that disciplinary actions cannot be nullified based solely on concerns or assumptions of potential prejudice to the accused employee. The court highlighted the necessity of concrete evidence of prejudice rather than mere apprehensions or suspicions and underscored that prejudice must be demonstrable as a factual reality or there must be clear indications of potential prejudice arising from specific statutory violations.
A series of writ petitions concerning the import of second-hand digital multifunction printing and copying machines were addressed by the Madras High Court where the court ordered the release of the machines on payment of enhanced customs duty. The court directed the respondents to consider the petitioners’ request for provisional release of the goods, provided the petitioners paid or deposited the enhanced duty amount. Upon receipt of the enhanced duty payment, the goods in question would be released within three weeks.
The Madras High Court has issued a directive for the reconsideration of a case concerning the confirmation of tax liability due to a discrepancy between GSTR 3B and GSTR 1 returns. This decision stems from the petitioner’s lack of awareness of GST proceedings until the entire tax liability was recovered from their bank account. The bench observed that the tax liability arises from a discrepancy between the GSTR 3B and GSTR 1 returns. Notably, the tax proposal was confirmed without the petitioner’s participation, and the entire liability was realised by appropriating funds from their bank account, ensuring full revenue interest. The court deemed it just and appropriate to afford the petitioner an opportunity to contest the tax demand on its merits. Consequently, the impugned order was set aside, and the matter was remanded for reconsideration.
The Bombay High Court has held that reopening of Income Tax assessment on the sole basis of change of opinion is invalid when the same is barred by limitation. The court thus noted that, once the notice has been treated as having been issued under Section 148A(b) of the Act, the said notice is no longer relevant for the purpose of determining the period of limitation prescribed under Section 149 or the restriction as per the first proviso below Section 149 of the Act. Thus, it was held that the question of applicability of the sixth proviso does not arise on the facts of the case and concluded that the impugned notice is clearly barred by the law of limitation.
The Delhi High Court issued notice to the government over non-adjudication of Show Cause Notice ( SCN ) and impugned Income order for 11 years and 9.5 years respectively. Counsel for the petitioner contended that the Principal Commissioner, in issuing the impugned order, incorrectly shifted the burden onto the assessee to prove the absence of delay on the department’s part.
The case is listed for further proceedings on 14.05.2024, as per the request.
The Delhi High Court overturned a demand order, citing the failure of the Goods and Services Tax (GST) proper officer to consider the taxpayer’s response, thus indicating a lack of due diligence. The bench observed that despite the fact that petitioner has filed a reply, the Proper Officer has held that neither he has filed a proper reply nor appeared for a hearing which ex-facie shows that the Proper Officer has not applied his mind to the reply submitted by the petitioner. The court ruled that the impugned order dated 05.12.2023 cannot be sustained and is set aside. The Show Cause Notice was remitted to the Proper Officer for re-adjudication.
The Court clarified that it has refrained from deliberating on or expressing opinions regarding the merits of the arguments presented by either party. All rights and contentions put forth by the parties remain reserved for further examination.
The Delhi High Court was approached seeking a directive for the Directorate of Revenue Intelligence ( DRI ) to consider their application for the release of seized gold bars/cutting bars. The court directed disposal within 1 week. The DRI seized the gold over lack of invoices and bills with the consignment.
The High Court of Telangana has clarified that the GST Authority does not have the power to issue orders for the insertion of a negative balance in the credit ledger of taxpayers. This verdict came as a result of a writ petition filed by Laxmi Fine Chem against the Assistant Commissioner challenging the blocking of input tax credit amounting to Rs. 50.06 lakhs for the period from February 1 to February 13, 2024.
The court observed that Rule 86A of the Central Goods and Services Tax Rules, 2017, stipulates that only the blocking of available input tax credit in the electronic credit ledger of the petitioner is permissible and observed that, the action on the part of the respondents in passing an order of negative credit to be contrary to Rule 86(A).
The Jharkhand High Court has held that any unjust withholding of money or property from another party goes against the fundamental principles of justice, fairness, and good conscience and directed JBVNL to refund Tax Deducted at Source ( TDS ). The Court has imposed a substantial penalty of Rs 5 Lacs on the Managing Director of Jharkhand Bijli Vitran Nigam Limited (JBVNL) for engaging in unnecessary litigation and presenting frivolous defences. The Court ruled in accordance with clause 10.7.4 of the Jharkhand State Electricity Regulatory Commission, Ranchi (Electricity Supply Code) Regulation, 2015, stating that the interest rate applicable to any excess amount paid by the consumer should match the interest rate charged by the consumer on delayed payment surcharges.
The Madras High Court ruled that the demand in the computation sheet and the demand notice cannot be sustained if the income tax assessment order did not propose any additions. The bench quashed the computation sheet demand and demand notice. During proceedings, the petitioner’s counsel highlighted the absence of any proposed additions in the assessment order and pointed out glaring errors in the computation sheet and demand notice. The court noted that no additions were intended regarding the issues outlined in the order. Consequently, the demand specified in the computation sheet and demand notice was deemed unjustifiable and was set aside.
The Madras High Court directed the Income Tax department to open the portal for the petitioner. The bench quashed the assessment order adding Rs. 16 crores as unexplained expenditure without providing reasonable time to explain.
The court observed show cause notice calls upon the petitioner to show cause on or before 20.03.2024 by enclosing all supporting documents such as bills, vouchers and bank statements. The court set aside the assessment order remanding the matter to the first respondent for reconsideration.
The Madras High Court overturned the rejection of the Goods and Services Tax ( GST ) refund application due to the Discrepancies between Inverted Turnover and GSTR 1, 3B and 2A. The court found procedural discrepancies in the rejection order and remanded the matter to the respondent for reconsideration. The court noted that the respondent should have examined the application in accordance with Section 54 of applicable GST enactments, the rules framed thereunder and the Circular referred to above.
The Madras High Court directed the taxpayer to regard the Order as a Show Cause Notice ( SCN ) due to officers’ direct replication of audit observations without adequate adjudication or consideration of the assessee into the SCN and GSTR DRC-07.
The court observed that the identical language in both the show cause notice and the impugned order indicated that audit observations were directly transposed into the show cause notice and subsequently adopted as conclusions in the impugned order. The court concluded that the adjudication process must be objective and without predetermination.
The Madras High Court directed the assessing officer to rectify the Income Tax Assessment order with regards to the sale consideration based on the District Valuation Officer’s ( DVO ) report. The validity of an assessment order has been called into question due to a confirmed variation concerning the variance between the sale consideration of an immovable property, as stated in the relevant conveyance deed, and the guideline value. The court added that the petitioner must be afforded a reasonable opportunity, and the assessing officer is mandated to pass an order on the rectification application within three months from the date of receiving a copy of this order.
The Madras High Court condoned the delay of 927 days. The court considered the failure to file the Income Tax Returns ( ITR ) on grounds of illness and subsequent demise of the CA of the petitioner as genuine hardship. This writ petition challenged the rejection of an application under Section 119(2)(b) of the Income Tax Act, 1961. Consequently, the order dated 23.02.2024 was annulled by a Single bench of Justice Senthilkumar Ramamoorthy and the delay in filing the return for assessment year 2020-21 was condoned.
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