This weekly round-up analytically summarizes the key stories related to the Supreme Court and High Courts reported at Taxscan.in during the previous week from October 25 to October 30, 2021.
In a major setback to Bharti Airtel, the Supreme Court allowed the GST refund worth Rs. 923 Crores. The Delhi High Court said, “Indisputably, if the statutorily prescribed returns, GSTR-2 and GSTR-3 had been operationalized by the Centre, the petitioner would have known the correct input tax credit amount available to it in the relevant period, and could have discharged its liability through the tax credit.”
The division bench of Justice A.M. Khanwilkar and Justice Dinesh Maheshwari assessee, Bharti Airtel cannot be permitted to unilaterally carry out rectification of his returns submitted electronically in Form GSTR3B, which inevitably would affect the obligations and liabilities of other stakeholders, because of the cascading effect in their electronic records.
The Bombay High Court held that the reduction of tax liability by claiming the wrong deduction cannot amount to concealment of income or furnishing inaccurate particulars.
The division bench of Justice Amit B. Borkar and Justice K.R.Shriram said that in any event, even assuming for a moment that such particulars were not furnished but only the return of income was filed showing the income tax payable on the total income as computed under the said Act, that cannot amount to concealment of particulars of income or furnish inaccurate particulars of income. Even the attempt, if any as alleged, to reduce tax liability by claiming the wrong deduction cannot amount to concealing the particulars of income or furnishing inaccurate particulars of such income.
The division bench is headed by the Chief Justice, S.Muralidhar, and Justice B.P.Routray held that the reasons for reopening the assessment do not point to any new material that was available with the (new material the Department. What appears to have happened is that the same. material viz., the accounts produced by the Assessee were re-examined and a fresh opinion was arrived at by the Opposite Party No.1 regarding the claim of the deduction of Rs.48,183/- on account of the loss of sale of assets. This had already been disclosed in the detailed accounts filed by the Assessee. In fact, a questionnaire had been issued by the AO in the course of the original assessment proceedings to the Assessee which was responded to by the Assessee. In other words, there was a conscious application of mind by the AO to the said materials. Therefore, the inevitable conclusion as far as the present case is concerned is that the reason to believe’ of the Opposite Party that income for the AY in question had escaped assessment is based on a mere ‘change of opinion.
The Madras High Court while directing the trial held that the burden lies on the assessee to Prove no wilful intention not to file Income Tax Return.
The single-judge bench of Justice C.V.Karthekeyan held that the Court cannot presume that the petitioner herein is innocent of any of the offences complained. It is for the petitioner to establish such innocence. The platform for establishing such innocence is the Court where the trial is to be conducted and in the present case, that particular Court is the Court of the Additional Chief Metropolitan Magistrate.
The Bombay High Court quashed the Faceless Assessment Order passed without the issuance of the draft assessment order and no personal hearing was granted.
The division bench of Justice Amit B. Borkar and Justice K.R. Shriram noted that one of the grounds there is a specific allegation that there is not even a whisper of these additions either in the alleged draft assessment order or in any of the notices issued in the course of assessment proceedings and no opportunity whatsoever was given to the petitioner to file its objections against these additions. In the affidavit in reply of the respondent, there is no denial of this fact. In the affidavit in reply, the affiant has gone on the merits of the two additions but does not deny the fact that neither the alleged draft assessment order nor any of the notices have not even referred to these proposed additions under Section 68 of the Act. Issuance of show cause notice is the preliminary step that is required to be undertaken.
The Orissa High Court held that assessment proceedings cannot be initiated if no incriminating materials are seized at the time of the search.
The division bench is headed by Chief Justice S. Muralidhar and Justice B.P. Routray held that with there being absolutely no incriminating materials found or seized at the time of the search, there was no justification for the initiation of assessment proceedings under Section 153A.
The Delhi High Court held that the Income Tax Appellate Tribunal (ITAT) was empowered to amend its own orders triggered on account of the mistake of counsel for parties.
The court held that once a mistake/error is brought to the notice of the Tribunal, which is apparent on the face of the record, either by the assessee or the assessing officer, the Tribunal would have the necessary power to rectify/amend its order. This power will also extend to a situation, such as the one obtained in the present case, where the petitioner’s counsel withdrew the appeal, for the reason that the issue concerning transfer pricing adjustment in respect of the assessment year in issue i.e., AY 2011-12, stood resolved.
The Madras High Court held that the burden lies on the assessee to show the absence of wilful intention to file an Income Tax Return.
The single bench of Justice CV Karthikeyan held that the burden lies on the assessee to show that he had no wilful intention not to file the Return. Any explanation to discharge such a burden can be tested only during the course of the trial.
The Patna High Court quashed the summary of the order in Form GST DRC-07 for violating the principles of natural justice.
The division bench headed by Chief Justice, Sanjay Karol, and Justice Rajan Gupta quashed the order on the grounds of violation of principles of natural justice, i.e. Fair opportunity of hearing. No sufficient time was afforded to the petitioner to represent his case, and the order passed ex parte in nature, does not assign any sufficient reasons even decipherable from the record, as to how the officer could determine the amount due and payable by the assessee.
The Bombay High Court directed the GST Authority to issue a refund along with the interest as Non-Transmission of Data Relating To Export from GSTN to Indian Customs Electronic Gateway (ICEGATE) is not a valid ground to withhold refund.
The Madras High Court ruled that the writ petition is not maintainable as a Statutory Alternative Remedy under GST Act. The Single Bench of Justice M.Sundar alleged Natural Justice Principle facet violation, in this case, is not compelling enough. Absent compelling ‘Natural Justice Principle violation, as there is no other exception (exceptions to alternate remedy rule) that arises in the case on hand, it is clear that this is a fit case to relegate the writ petitioner to alternate remedy by way of statutory appeal under Section 107 of TN- GST Act and CGST Act.
The Madras High Court held that the writ petition is not maintainable as Statutory Alternative Remedy is available for challenging re-assessment orders under TNVAT Act.
The single bench of Justice M.Sundar while dismissing as many as 6 petitions assailing six separate revisional or re-assessment orders under Section 27 of Tamil Nadu Value Added Tax Act, 2006 held that this is not a case for exercising writ jurisdiction for interference qua impugned orders. Therefore, the campaign against impugned orders in writ jurisdiction in the captioned main writ petitions fail. However, it is made clear that it is open to the writ petitioner to avail alternate remedy under Section 51 of the TNVAT Act if the writ petitioner chooses to do so, subject to limitation and pre-deposit conditions set out therein, i.e., if the writ petitioner satisfies these conditions and takes alternate remedy route i.e., statutory appeal, the Appellate Authority shall deal with the appeals on its own merits and in accordance with the law, uninfluenced by any of the observations made in this order.
The Punjab & Haryana High Court grants Bail to persons accused of fraudulently availing Input Tax Credit (ITC) without any invoice.
Support our journalism by subscribing to Taxscan AdFree. Follow us on Telegram for quick updates.
