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2021 (11) TMI 903
Seeking necessary instructions to the RP to consider the claim without having any regard to the delay - Resolution plan not approved - HELD THAT:- When we read the old and new regulation 12(2) of the IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 then it can be said that prior to the amendment in regulation 12(2), a claim is required to be filed before the IRP or the RP as the case may be, till the approval of a resolution plan by the committee and that is the reason earlier the Co- ordinate Bench has given directions to the RP to consider the claim in some cases but after the amendment till the approval of the resolution plan by the committee was substituted by on or before the 90th day of the insolvency commencement date.
Herein the case in hand, as we notice that the CIRP was initiated on January 27, 2020 and thereafter, the public announcement was made and within the prescribed period no claim was placed by the applicant. We further notice that, in view of the amended regulation 12(2) of the IBBI (Insolvency Resolution Process for Corporate Persons) Regulations 2016, the claim was not filed within the 90 days of the insolvency commencement date.
Due to pandemic the lockdown was imposed by the Government the claim could not be submitted within time. Admittedly, in another matters, we exclude the period of lockdown which was imposed on March 25, 2020 till May 31, 2020, i. e., 68 days, if we exclude this period of lockdown while calculating the period of 90th day from the CIRP period even then the claim of the applicant is delayed because it was submitted on December 23, 2020.
In view of regulation 12(2), the prayer of the applicant is not liable to be accepted - Application dismissed.
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2021 (11) TMI 902
Money laundering - Freezing of petitioner's bank account - grievance of the petitioners can be addressed in the proceedings for continuation of freezing orders or not - urgency in the matter as salaries and statutory benefits of the employees have not been paid and the employees would suffer hardship - HELD THAT:- This Court is inclined to grant interim order to the extent of payment of salary to the employees of the petitioners. There shall therefore, be a direction to the respondents to permit the petitioners to operate the bank accounts to the extent of ₹ 2 crores, subject to their furnishing bank guarantee for the said amount. The petitioners are permitted to operate the bank accounts with respect to the amounts deposited on or after 12.10.2021, forthwith. Both the learned counsel agree that in terms of this interim order, the Writ Petitions may be disposed of giving liberty to the petitioners to approach the Adjudicating Authority, in accordance with law.
Petition disposed or giving liberty to the petitioners and the respondents to raise all legal contentions before the Adjudicating Authority.
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2021 (11) TMI 901
Levy of service tax - indivisible composite work contracts - respondent has prima facie taken a view that petitioner had rendered certain taxable services and declared the value of the services in its return of income under the Income Tax Act, 1961, but as the service provider had not paid any service tax, the same has resulted in non-payment of service tax - why income declared in the Income Tax Return for the period 2016-17 and for the period 2017-18 up to June, 2017 should not be treated as income received from taxable services under the Finance Act, 1994, besides levy of interest and imposition of penalty? - HELD THAT:- In the instant case, the two aspects i.e., whether the petitioner had provided services to only Governmental authorities, and not others, and even if provided to Governmental authorities, whether the contracts were indivisible, or composite, and secondly whether the extended period of limitation as per the proviso to sub-section (1) of Section 73 of the Act, would be applicable or not, would depend upon the factual examination and adjudication by the adjudicating authority. We are of the view that to preempt the adjudicating authority from carrying out the said exercise at the threshold would not be justified.
From a reading of the show cause notice dated 18.10.2021, no definite view can be taken at this stage, that the said notice is beyond the period of limitation in terms of the proviso to sub-section (1) of Section 73. These are matters for examination and adjudication by the primary authority. In the circumstances, it would be in the interest of justice if the petitioner is relegated to the forum of adjudication before the respondent No.1. Ordered accordingly.
Petition disposed off.
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2021 (11) TMI 900
Jurisdiction to issue SCN - validity of summons issued to the officers of the petitioner - validity of appointment of officers of DGCEI as ‘Central Excise Officers’ having all India jurisdiction - premeditated mind and lacking in judicial discipline - whether proceedings instituted are without jurisdiction? - HELD THAT:- The jurisdiction of the Chief Commissioner of Central Excise, Bangalore has come to the Principal Commissioner of Tax-1, Bangalore and Chief Commissioner of Tax-II, Bangalore. Likewise, territorial jurisdiction of Principal Commissioners of Service Tax is conferred on the Principal Commissioner of Service Tax- I depicting several zones in Bangalore and Principal Commissioner of Service Tax-II depicting several zones in Bangalore. This notification comes into effect from 15-10-2014. After the 2nd respondent issuing summons and recording statements, the matter is referred to the Principal Additional Director General, Central Excise Intelligence of Service Tax. This is in terms of Notification issued on 15.10.2014 pursuant to which, the Principal Additional General, Central Excise Intelligence, Principal Additional Director General, Service Tax or Principal Additional Director General, Audit shall exercise the power of the Principal Commissioner.
The five officers who are indicated are empowered to exercise the powers of the Principal Commissioner. Likewise, Senior Intelligence Officer, Central Excise Intelligence, Superintendent, Service Tax or Superintendent Audit could exercise the power of the Superintendent. The justification of the revenue is in terms of the said notification, the summons that were issued by the Intelligence Officer is now transferred to Principal Commissioner who has also issued a detailed show cause notice which is impugned in the writ petition to answer the notice - a Central Excise Officer would mean the Principal Chief Commissioner of Central Excise, Principal Commissioner of Central Excise, Additional Commissioner of Central Excise and other officers as defined under the Act. If the definition of Central Excise Officer under the Act is read in tandem with the impugned notification, it becomes unmistakably clear that a Principal Commissioner of Central Excise is also a Central Excise Officer and the power of the Principal Commissioner can be exercised by the aforesaid 5 officers one of whom is the Principal Additional Director General, Central Excise Intelligence.
In taxing parlance, an Assessing Officer before whom a particular assessee goes, Authority cannot transfer the proceedings even to the next assessing officer as it becomes without jurisdiction. It is not a case of the kind at hand as the second respondent has not exercised the jurisdiction of the competent authority. Though the summons emanate from the office of the Deputy Director of Directorate General of Central Intelligence, the file is transferred to the competent authority. The show cause notice is issued by the proper officer. Therefore, I decline to accept that the show cause notice issued is without jurisdiction.
The show cause notice is within the jurisdiction and not without, as contended. Therefore, the petitioner has to answer to the show cause notice and further proceedings to take place in accordance with law.
Petition dismissed.
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2021 (11) TMI 899
CENVAT Credit - input services common to both taxable as well as exempt services - Rule 6(3A) of CCR,2004 - adjudicating authority dropped the demand for the period prior 1.4.2011 on the ground that trading is classified as an exempted service only from 1.4.2011 - whether the turnover of a particular unit should be taken into consideration for arriving at the amount of tax credit to be reversed in terms of Rule 6(3A) of CENVAT Credit Rules, 2004? - HELD THAT:- For the period 01.04.2011, the issue stands decided in the case of MERCEDES BENZ INDIA PVT LTD. VERSUS COMMISSIONER OF CENTRAL EXCISE, PUNE-1 [2014 (4) TMI 12 - CESTAT MUMBAI] wherein it was held that trading is not an exempted service prior to 01.04.2011; provisions of Rule 6 requiring reversal of 6% of trading turnover is not applicable. We also find that the matter prescribed under Rule 6 of CCR, 2004, can be applied for the period before 01.04.2011 also as held by the Tribunal in the case of M/S TFL QUINN INDIA PVT. LTD. VERSUS CC & CE, HYDERABAD-IV [2016 (6) TMI 230 - CESTAT HYDERABAD].
It is not coming forth from the records of the case as to whether the Department has appealed against such order and if so, the outcome of the same. While holding that the Department is not precluded from issuing SCN to the head office of the Respondents as res judicata would not apply to taxation matters, it is found that there is a dichotomy in the approach of the appellant department. The benefit of doubt should go the appellants.
Coming to the period subsequent to 01.04.2011 when trading came to be considered as an exempted service, we find that the appellants have reversed credit, of ₹ 27,37,30,026/- for the period 2011-12 to 2014-15, in terms of Rule 6(3A) of CCR, 2004, on proportionate basis - Hon’ble Karnataka High Court has dealt with the very same issue in the case of THE COMMISSIONER OF CENTRAL EXCISE BANGALORE - IV (ERSTWHILE BANGALORE - II) COMMISSIONERATE VERSUS M/S. ITC LIMITED [2021 (5) TMI 366 - KARNATAKA HIGH COURT] and the Hon’ble High Court has held relying on the Division Bench decision in the case of COMMISSIONER OF C. EX., BANGALORE-I VERSUS ECOF INDUSTRIES PVT. LTD. [2011 (2) TMI 1130 - KARNATAKA HIGH COURT] held that there are only two limitations imposed under Rule 7 of the Rules, for distribution of credit by an Input Service Distributor.
The learned Commissioner’s order is legal and proper and as such does not require any interference - appeal dismissed.
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2021 (11) TMI 898
CENVAT Credit - value of trading activities to be taken for calculation - whether the value of goods, deemed to be supplied in execution of works contract, are to be treated as trading simplicitor, for calculation of amount for reversal (of proportionate credit), as per Rule 6(3)(ii) of Cenvat Credit Rules? - HELD THAT:- The addition to the trading turnover, of the value of the goods deemed to be supplied in execution of the works contract, is erroneous and wrong. Accordingly, the show cause notice is mis-conceived. It is further noticed that in the earlier period, identical show cause notice dated 2.9.2016 was issued to the appellant for denying cenvat credit to the extent of ₹ 1,37,01,095/- . On similar grounds, the said show cause notice was adjudicated by the Addl. Commissioner vide order-in-original dated 26.03.2018, wherein similar demand with respect to the goods deemed to be supplied in the course of works contract service, was dropped. The said order has been accepted by the Department, as no further appeal has been filed.
The appeal is allowed.
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2021 (11) TMI 897
Classification of services - supply of man power and recruitment services or not - independent contractor carrying out the manufacturing activity in the premises of the service recipient - HELD THAT:- The issue has already been decided by this Tribunal in M. ARUL PRAKASAM, S. SUBARAYALU, G. RAMAKRISHNAN, R. ATHINARAYANAN AND P. KANNUSAMY VERSUS COMMISSIONER OF GST & CENTRAL EXCISE, CHENNAI [2021 (8) TMI 1063 - CESTAT CHENNAI] where it was held that the activity undertaken by the appellants cannot fall under the category of manpower supply service.
The issue is no longer res integra. Following the orders of this Tribunal, the impugned order is not sustainable and same is set aside - Appeal allowed - decided in favor of appellant.
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2021 (11) TMI 896
CENVAT Credit - manufacture of exempt product namely ‘sludge’ - appellants have used common inputs for manufacture of dutiable product (Gelatine) and exempted product (Sludge) - non-maintenance of separate records - Rule 6 (3) of Cenvat Credit Rules, 2004 - period from 10.05.2008 to 30.09.2011 - HELD THAT:- The demand has been raised on the view that the sludge removed is an exempted goods manufactured by the appellants. The appellant does not consciously manufacture any waste. During the course of manufacture, the waste that arises is drained into the Effluent Treatment Plant. Thus, waste removed from the Effluent Treatment Plant forms sludge and is removed on a daily basis to a dump yard from where it gets dried and is thereafter sold to fertilizer manufacturers. The appellant has to comply with the pollution control requirements and therefore maintain the Effluent Treatment Plant and remove the waste as per the effluent norms. A manufacturer would be happy when there is less waste or no waste at all since the burden of maintaining the effluent treatment plant and the transportation of the sludge etc. can be minimized. No manufacturer would consciously manufacture waste. For these reasons, it cannot be said that the waste / sludge is an ‘exempted goods’ manufactured by the appellant.
The said issue stands considered by the Tribunal in the case of ITC LTD VERSUS COMMISSIONER OF CENTRAL EXCISE, SALEM [2013 (12) TMI 928 - CESTAT CHENNAI]. In fact, the Commissioner (Appeals) has cited the said decision to set aside the demand prior to 10.05.2008. It has to be stated that even after 10.05.2008, though the Explanation to Section 2(d) states that any article, material or substance which is capable of being bought and sold for a consideration will also fall within the definition of “goods”, in the present case, the appellants having not manufactured the waste consciously, it cannot be considered as an ‘exempted goods’ falling under Rule 6 (3) of CCR 2004.
The demand cannot sustain - appeal allowed - decided in favor of appellant.
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2021 (11) TMI 895
Clandestine removal - CTD bars and rods - shortage of inputs - department has been able to sufficiently establish the basis of the duty demand or not - penalty - HELD THAT:- When the Tribunal had not made any observations with regard to the shortage of raw materials and had clearly remanded to look into the transactions between the traders and M/s. MMSD and the method adopted by the appellant to clandestinely clear the finished products through M/s. MMSD, the quantification of shortage of raw materials on the basis of EXIM Policy, was totally unwarranted and purposeless. The input output ratio given in the EXIM Policy (Sl. No. C513) has been adopted to calculate the input output ratio of manufacture of CTD bars. The appellant herein has neither imported raw materials nor do they export their finished products. This ratio has not been made the basis for quantification of duty in the Show Cause Notice.
Though the remand was to look into the demand of ₹ 12,90,032/-, the duty confirmed in the impugned order is ₹ 21,15,379/-. This is because the Commissioner has added ₹ 11,48,044/- which has been already upheld by the Tribunal to the amount of ₹ 9,67,335/- arrived by him. I cannot understand the logic of the adjudicating authority in adding the amount that has already been upheld by the Tribunal. Though the Tribunal has remanded the matter to look into the penalty that has to be imposed after readjudication of the issue of ₹ 12,90,032/- that has been remanded, the issue of penalty in regard to ₹ 11,48,044/- has to be recorded separately. The duty demand that has been already upheld by the Tribunal cannot be added to the amount of adjudication in denovo adjudication. The adjudicating authority has confirmed the total demand of ₹ 21,15,379/-. There is no demand of ₹ 21,15,379/- at the time of adjudication. The demand adjudicated is only ₹ 12,90,032/-. There cannot be confirmation of a higher amount.
The Commissioner having analysed merely the shortage of raw materials, the argument of the learned counsel that they requested for cross-examination of mahazar witnesses and the adjudicating authority did not allow the same acquires relevance - though in the Show Cause Notice it is alleged that 615.28 MTs of CTD bars were clandestinely removed through M/s. MMSD and duty demand of ₹ 12,90,032/- was raised, in the present order, the adjudicating authority has held that the CTD bars unaccounted would be 461.37 MTs only. Then it has to be explained through which of the traders, the same were shown to be purchased. The allegation on this issue is that the clearance was camouflaged through fake invoices of many traders. The evidences in this line are not discussed.
Department has not been able to establish with preponderance of probability the duty demand in respect of 615.28 MTs of CTD bars received by M/s. MMSD as alleged in the Show Cause Notice - the demand confirmed in regard to the CTD bars received by M/s. MMSD requires to be set aside - Since the remand was for reconsidering the penalty, the duty demand upheld by the Tribunal with respect to ₹ 11,48,044/- having attained finality, the equal penalty confirmed in the earlier adjudication order would sustain.
Appeal allowed in part.
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2021 (11) TMI 894
Process amounting to manufacture or not - Ethanol Blended Petrol - whether the production of 10% Ethanol Blended Petrol (EBP) which involves the blending of 10% duty paid ethanol with 90% duty paid Motor Spirit (MS, commonly known as petrol) amounts to manufacture in terms of Section 2(f) of the CEA? - liability of excise duty prior to the issuance of Notification Nos.61,62,63, & 64/2008-CE dated 24.12.2008 - HELD THAT:- The dispute involved in this case pertains to the period from 16.12.2008 to 23.12.2008. We find that by placing reliance on the decision of BHARAT PETROLEUM CORPN. LTD. VERSUS COMMR. OF C. EX., LUCKNOW [2009 (2) TMI 170 - CESTAT, NEW DELHI], this Tribunal has set aside the Order-in-Appeal and allowed the appeal filed by M/s Bharat Petroleum Corporation Limited holding that the process of blending of small quantity of MFA with MS and HSD does not amount to manufacture and thus, would not attract payment of Central Excise duty.
The issue arising out of the present dispute is no more open for any debate - Appeal allowed - decided in favor of appellant.
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2021 (11) TMI 893
Refund of CENVAT Credit - Credit under protest - rejection on the ground of time limitation - HELD THAT:- The reversal of CENVAT credit on 29.10.2005 was under protest, ifso facto, as the same was reversed during the pendency of the adjudication proceedings and the appellant had contested the amount in dispute. The refund claim is within time as the same is filed within 2 months from the date of order-in-appeal.
The adjudicating authority is directed to grant refund of the said amount in cash, as required under the Transitional Provisions of CGST Act, and is further directed to pay interest @ 12 p.a. from the date of reversal of the cenvat credit amount till the date of payment, (as per Section 35 FF, which provide for interest from the date of deposit till the date of refund) - Appeal allowed - decided in favor of appellant.
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2021 (11) TMI 892
Collection of differential tax - compounded tax for dealers in ornaments or articles of gold, or other metals were retrospectively amended for the year 2011-12 - interpretation of the validation clause - HELD THAT:- Under S. 8(f)(i) of the KVAT Act, the rate of compounded tax for dealers who opted to pay tax under the section for the first time was marginally higher than those who had opted to pay the tax at compounded rates from the previous year or even before that period. Section 8(f)(v) of the Act dealt with the category of dealers who had opted for compounded tax from the previous years. It may be essential to extract section 8(f)(i) and S.8(f)(v) of the KVAT Act as it stood on 31-03-2011.
As per the provisions of Article 196(5) of the Constitution of India, a Bill pending before the Legislative Assembly of a State shall lapse on dissolution of the Assembly. The 12th Kerala Legislative Assembly was dissolved on 14-05-2011 and thus, the First Bill lapsed as on that date, by operation of law.
The apparent confusion among the dealers is created on account of the wording in the validation clause of Act 16 of 2011. On a deeper scrutiny of sub clause (2) of the validation clause, it can be understood that the language used in the said provision was not with a view to erase the retrospectivity brought in by the amended provisions but was intended only as a measure of validating the First Bill which had by virtue of Article 196(5) of the Constitution lapsed. The First Bill was pending in the Legislative Assembly of the State when the Assembly was dissolved. As per Article 196(5) of the Constitution, a bill which is pending in the Legislative Assembly of a State, shall lapse on dissolution of the Assembly. The validation clause was included in Finance Act 16 of 2011 to overcome the legal imbroglio that arose on account of the dissolution of the Assembly on 14.05.2011 and the subsequent presentation of the Second Bill on 19.07.2011. The validation clause brings in a continuity and overcomes the vacuum created by the dissolution of the Assembly.
The State was bound and entitled to recover the differential tax from the dealers and the demand notices were issued in valid exercise of power - Petition dismissed.
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2021 (11) TMI 891
Smuggling - narcotic drugs concealed in a suit case - offences under Sections 21(c) and 29 of the Narcotic Drugs and Psychotropic Substances Act, 1985 - HELD THAT:- On perusal of the testimony of witness recorded before the learned trial court, impugned judgment and order on sentence as well as decisions relied upon, this Court finds that there are material contradictions in the story put-forth by the prosecution.
It is a settled law that an accused is presumed to be innocent unless proven guilty and to prove the guilt, the prosecution is required to substantiate its case by showing that the due procedures prescribed under the NDPS Act have been followed, coupled with the assistance of material witnesses. However, in the present case, prosecution has not made any efforts to trace out the co-accused Sanjay, who had purportedly brought the substance for delivery to the appellant. The prosecution has even failed to examine the panch witnesses namely, Raj Kumar and Ombir, who would have proved the arrest and recovery. The Panchnama prepared at the spot did not bear signatures of any of the panch witnesses. In addition, the manner in which the offending vehicle was traced, apprehended and recovery was made, also casts a doubt upon the credibility of prosecution case.
Also, prosecution has failed to substantiate as to how two reports obtained from CRCL had different analysis and as to why opinion of PW-19 with regard to two different reports, one of “Diactyl Morphin” (Heroin) and the other for “Opium” being drawn from two different samples, be not accepted.
This Court finds that prosecution has immensely failed to prove its case beyond reasonable doubt, therefore, it is a fit case to grant benefit of doubt to appellant/accused - Petition allowed.
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2021 (11) TMI 890
Smuggling - recovery of Pseudoephedrine during search - mandatory provisions of Section 50 NDPS Act have been followed or not - section 67 NDPS Act - HELD THAT:- In the instant case, on 10.01.2019 a secret information was received and petitioner was intercepted at IGI airport while he was travelling to Dar-Es-Sallam via Doha and during search 24.5 Kg. of Pseudoephedrine was recovered from his bag. The petitioner during investigation tendered his voluntary statement U/s 67 NDPS Act and admitted the recovery. The petitioner was supposed to hand over the suit case containing Pseudoephedrine to his co-accused at Tanzania which was seized from his possession. During investigation, mobile phone of the petitioner and other co-accused persons were examined and it was found that they were in constant touch with each other.
Manner in which the samples were drawn was as per law or not - it is contended that the sample were not taken from each packet and this is totally a violation of law in drawing the sample of drugs - while issuing notice U/s 50 of the NDPS Act the mandatory provisions of Section 50 NDPS Act have been followed or not - HELD THAT:- Both the contentions are liable to be rejected as they relate to violation of the procedural aspects which can only be looked into during the course of trial and cannot be deeply analyzed at the stage of bail.
Applicability of embargo of Section 37 of NDPS Act - the substance recovered is neither a narcotic drug nor a psychotropic substance - HELD THAT:- In the instant case, there is a recovery of huge quantity of Pseudoephedrine i.e. 24.5 Kg. which was recovered from the possession of the petitioner while he was present at the IGI airport for travelling to Tanzania.
In the instant case, looking into the allegations against the petitioner, quantity of the substance recovered and also the fact that the petitioner is a foreigner and bail of the co-accused has been dismissed by this court vide order dated 24.11.2020, no ground for bail is made out.
The bail application is dismissed.
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2021 (11) TMI 889
Provisional Attachment of petitioner's bank Account - Section 83 of the CGST Act, 2017 read with Rule 159(1) of the CGST Rules, 2017 - HELD THAT:- The issue brought before us is squarely covered by the decision of the Supreme Court in M/S RADHA KRISHAN INDUSTRIES VERSUS STATE OF HIMACHAL PRADESH & ORS. [2021 (4) TMI 837 - SUPREME COURT] where it was held that The formation of an opinion by the Commissioner under Section 83(1) must be based on tangible material bearing on the necessity of ordering a provisional attachment for the purpose of protecting the interest of the government revenue.
The impugned communication dated 1.2.2021 issued under Section 83 of the CGST Act, 2017 is set aside. The aforesaid bank account of the petitioner may be released from attachment, forthwith - Petition allowed.
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2021 (11) TMI 888
Levy of interest - interest imposed on gross amount without deducting the Input Tax Credit which is already paid by the petitioner - appeal preferred by the petitioner has been rejected without any application of mind to the grounds of appeal raised by the petitioner - violation of principles of natural justice - HELD THAT:- This Court, notwithstanding the statutory remedy, is not precluded from interfering where, ex facie, we form an opinion that the order is bad in law. This we say so, for two reasons- (a) violation of principles of natural justice, i.e. Fair opportunity of hearing. No sufficient time was afforded to the petitioner to represent his case; (b) 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 order, ex parte in nature, passed in violation of the principles of natural justice, entails civil consequences.
Petition disposed off subject to conditions agreed upon between parties.
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2021 (11) TMI 887
Exemption from GST levy - printing of pre-examination material items like Question Papers, OMR Sheets [Optical Mark Reading], Answer Booklets with/without OMR, Practical Answer Booklets, Hall Tickets and other examination material specific to various educational boards/Universities - printing of post-examination material like Rank Cards, Marks Cards, Grade Sheets and Certificates specific to various educational boards/ Universities - activity of evaluation of OMRS and answer sheets, i.e., scanning and processing of results of examination - amounts to provision of service or not - HELD THAT:- The Sl.No.66 of Notification No.12 of 2017-Central Tax (Rate), dt: 28-06-2017 provides for exemption for services related to admission to or conduct of examination by such institution. Therefore if the applicant is providing any service in relation to conduct of examination by an educational institution as defined in the notification above then such services qualified to be exempt under Entry No.66 of Notification No.12/2017.
Printing of Cheques - HELD THAT:- The Notification No.2 of 2017 exempts supply of Cheques, lose or in book form at HSN code 4907. The applicant does not supply cheques to Bankers, it is the Bankers who are supplying cheques to their customers. The content of the cheque book is supplied by the banker and the banker is the person who owns usage rights to such intangible property. The applicant is printing cheques as per the directions of the Bankers and therefore in case of cheques where the applicant uses their own physical input, i.e., paper. The applicable rate of GST will be on different footing.
In the case of the applicant he is providing services of printing and this activity of printing is not falling under item (i) of heading 9989 i.e., printing of newspapers, books (including Braille books), journals and periodicals and therefore is covered under Heading 9989 (ii) of Notification No.11/2017-Central Tax (Rate), dated: 28-06-2017 as amended and is taxable at 9% CGST & 9% SGST - In view of the clarification issued by CBIC dated: 20.10.2017 it is clarified that where the applicant uses physical input, i.e., paper supplied by their client for the purpose of goods falling under chapter 48 or 49 of customs then the same will fall under Heading 9988 (ii)(a) and is taxable at 6% under CGST.
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2021 (11) TMI 886
Exemption under GST - Applicability of N/N. 39/2017-CT(R) dated 18.10.2017 read with G.O.Ms.No. 140 dated 17.10.2017 issued by the Commercial Taxes and Registration Department - activity of manufacture and supply of Fortified Rice Kernels to the Tamil Nadu Civil Supplies Corporation pursuant to the Pilot Scheme on “Fortification of Rice &, its Distribution under the Public Distribution System” project launched by the Central Government - HELD THAT:- In the case at hand, the applicability of the Notification was raised before us for the FRK(Premix) supplied by the applicant to the Designated Rice Mills for mixing with the Rice in a fixed proportion and distributing the same under the Scheme duly approved by the Government. As per the submissions, it has been established by the applicant, that the product satisfies the conditions for classifying under CTH 19 basis the Laboratory report furnished by them. It is also established that they undertake supply of FRK as per the tender conditions and supplies the same to the Designated Rice Mills for intended supply under the scheme on mixing the FRK with the Rice in the given proportion. It is also seen that the supply is made based on the demand placed on them vide proceedings issued by the TNCSC and invoice is raised for each such period of supply. The product supplied by the applicant to the rice mills for blending with rice grains is Fortified Rice Kernel (FRK), which per-se is not a 'Food Preparation', in as much as the FRK cannot be consumed as such or after cooking, but FRK is 'goods'. Further the FRK is not directly supplied to the economically weaker sections, but only after blending with rice grains in designated rice mills.
The Notification No. 39/2017-C.T.(Rate) dated 18.10.2017 provided the concessional rate to 'Food Preparation' subject to fulfillment of conditions at Column (4) before such amendment. Therefore, the concessional rate under Notification No.39/2017-C.T.(Rate) for the Period 18.10.2017 to 30.09.2021 is not available to the applicant for reasons, that;-
(1) FRK is not a food preparation put up in unit containers for free distribution to economically weaker sections and;
(2) Applicants are not involved in free distribution of FRK to economically weaker sections.
Vide notification No. 11/2021-C.T. (Rate) dated 30.09.2021, the Notification 39/2017 dated 18.10.2017, was amended effective from 01.10.2021, by including the terms “Fortified Rice Kernel (Premix) supply for ICDS or similar scheme duly approved by the Central Government or any' State Government” in column (3) and also, the words 'Food Preparation' is amended as 'goods' in column (d) of the Notification - The applicant is eligible for the benefit of Notification No. 39/2017-C.T.(Rate) dated 18.10.2017 as amended by Notification No. 11/2021-C.T.(Rate) dated 30.09.2021, effective from 01.10.2021 only, on fulfilling the conditions stipulated thereon in column (d) for such periodic demand and supply of FRK (Premix) made by them and the concessional rate is not eligible to them for the period upto 30.09.2021.
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2021 (11) TMI 885
Exemption under GST - Services provided by the applicant to the recipient i.e. The Greater Chennai Corporation - service provided to the local authority by way of activity in relation to functions entrusted to a Panchayat. under article 243G and Municipality under article 243W of the Constitution - pure services or not - composite supply or not - time of supply - benefit of Serial No. 3 of Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017 - Difference of opinion - HELD THAT:- The issue is not answered and is deemed to be that no ruling is issued under Section 101(3) of the CGST/TNGST Act 2017 because of the divergence of opinion between both the Members.
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2021 (11) TMI 884
Classification of supply - deemed service or not - purchasing flats/buildings while they are under construction - immovable property should fall under the definition in clause 5(b) of Schedule II of SGST Act, 2017 or not - inward supply does fall under the exclusion provided in Sec 17 of the CGST Act, 2017 from availing input tax credit (ITC) or not - HELD THAT:- Though the construction of a building is covered by the definition of works contract still there are (2) separate entries in Schedule II which describe the eligibility of immovable property to tax. Both these entries read with Sec 7(1A) make the supply of immovable property taxable under the Act. However, the Schedule II carves out certain types of works contract under clause 5 to be treated differently from the types of works contract enumerated in Entry 6. This does not alter the basic definition of works contract given in Sec 2(119).
It is a settled principle of interpretation that while interpreting the provision of taxing statute, a construction which would preserve the purpose of provision should be adopted. Therefore in the very nature of taxation statute the interpretation cannot be absolutely cast upon the logic. The purpose of introducing exceptions in Sec 17 of the CGST Act, 2017 is to distinguish it from other transactions. Wherever the legislature has considered it appropriated to ensure consistency in the working of various provisions and to avoid repugnancy and ambiguity in such places they have clearly enacted such exclusions. Where such clarity of excluding a particular transaction is not clearly mentioned it cannot be inferred by logic.
The interpretation of Sec 17(5)(c) wherein works contract services are excluded from claiming ITC will include all activities enumerated under Sec 2(119). And this definition does not exclude any species of works contract relatable to any immovable property where transfer of property in goods is involved. Thus the applicant who is purchasing building under an agreement of sale is not eligible to claim ITC under Sec 17 of the CGST Act, 2017.
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