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Showing 261 to 280 of 324 Records
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2025 (3) TMI 64
Levy of servie tax - insurance auxiliary services - incentives received from insurance companies - reverse charge mechanism - HELD THAT:- In respect of the same Appellant, the Tribunal for the earlier periods has set aside the demands and penalties vide SREE SARADAMBAL AUTOMOBILES (P) LTD. VERSUS COMMISSIONER OF CENTRAL EXCISE, COIMBATORE [2018 (3) TMI 195 - CESTAT CHENNAI] where it was held that appellants were not liable for service tax under Insurance Auxiliary Service due to their lack of qualifications as actuaries and the nature of their operations as explained during the proceedings.
The impugned Order-in-Appeal cannot be sustained - appeal allowed.
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2025 (3) TMI 63
Abatement of appeal, on the death of the appellant - short payment of service tax - suppression of value - recovery alongwith penalty - HELD THAT:- The Appellant who was a sole proprietor has died on 31.05.2022 during the pendency of the present appeals. We also find that in terms of Rule 22 of Customs, Excise and Service Tax Appellate Tribunal (Procedure) Rules, 1982, on the death of the appellant, the proceedings will be abated unless an application is made for continuance of such proceedings by the legal Heirs of the Appellant. In this case, no such application has been received. As the Death has occurred on 31.05.2022, nearly three years passed already.
In view of the judgement of the Hon’ble Supreme Court in the case of Shabina Abraham & Ors. Vs. Collector of Central Excise & Customs [2015 (7) TMI 1036 - SUPREME COURT] wherein it has been held that no proceedings can be initiated or continued against a dead person as it amounts to violation of natural justice in as much as the dead person, who is proceeded against is not alive to defend himself.
Conclusion - On the death of the appellant, the appeal stands abated and disposed of in terms of Rule 22 of the CESTAT procedure Rules, 1982.
Appeal is abted and disposed off.
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2025 (3) TMI 62
CENVAT Credit - input services - whether or not, the disputed services on which the CENVAT credit is taken by the appellants is duly covered under the scope and definition of Rule 2(l) of the CENVAT Credit Rules, 2004 as ‘input service’?
Catering, food and outdoor catering services - HELD THAT:- Under the unamended provisions (effective up to 31.03.2011), the phrase ‘activities relating to business’ was specifically finding place in the inclusive part of the definition of ‘input service’. The inclusive definition in a fiscal statute is a well-recognized device to enlarge the meaning of the word defined and it expands the meaning of the basic definition - such an yardstick cannot be applied for the period w.e.f. 01.04.2011,as by way of amendment of the definition of input service, certain services like general insurance services, Health Insurance, outdoor catering, beauty treatment, health services, cosmetic and plastic surgery, membership of a club, health and fitness centre, life insurance, health insurance and travel benefits extended to employees etc., were excluded from the purview of definition of input service, and in the eventuality, when the said excluded category of service(s) are used primarily for personal use or consumption of any employee. In other words, CENVAT credit of service tax paid on such service(s) should not be considered as input service, entitling an assessee to avail CENVAT credit thereon.
Health & fitness service - HELD THAT:- The records placed in file and sample invoices indicate that these services have been used to keep a check over the wellness or health of a person, before taking up the assignment in the appellants company and for taking up job assignments/projects from time to time. Further, the invoices have been billed to the company and not for the individuals for their personal consumption. Hence, these services are eligible to be considered as ‘input service’. Further, it is also found that the Tribunal in the case of SITEL India Limited [2016 (3) TMI 203 - CESTAT MUMBAI] have held that health and fitness service as eligible input service, where the output service is being provided on 24X7 basis, which is also the situation in the present case.
Interior decorator service - HELD THAT:- In the representative sample invoice submitted by the appellants, it is shown as the renovation works under taken for the guest house at Vikhroli. No other details are available to relate such renovation or interior decoration work having a relation to the provision of output service, either directly or indirectly. Therefore, it is unable to agree with the view that in the present case, there is sufficient evidence to consider the interior decorator service as an eligible input service. Therefore, CENVAT credit to the extent of Rs.6,93,107/- relatable to the ‘interior decorator service’ is not admissible as eligible input service.
Packaging services - HELD THAT:- The nature of services are mentioned as packing, unpacking, loading, unloading and transportation of household goods for transportation from one location to another with respect to few employees. Though it is claimed by the appellants that such services were used for packaging and movement of various goods procured for use in the provision of output services, there are no evidence to such claim in the documents placed in the appeal records or in any of the written submissions given by the appellants. In such a factual position, it is unable to find any basis for allowing such services used for personal consumption of employees under the category of eligible input service and therefore consider these services as ineligible input service.
Public relations service - People relationship management service - HELD THAT:- The Co-ordinate Bench of the Tribunal in the case of Orient Bell Limited [2017 (1) TMI 840 - CESTAT ALLAHABAD] have examined the public relations service and have held that these are having an objective of enhancing Brand Value, support to Marketing & Promotional Initiatives, Building Corporate image, Creating Awareness etc. to enable the company in providing enhanced output services. In view of the above, these services could be considered as eligible input service.
Photography service - video tape service - HELD THAT:- The adjudicating authority on examination of the invoices submitted before him had given a finding that he is unable find any information other than the name of service provider, in order to relate to the output service provided by the appellants. It is unable to examine the factual aspect as no invoices or supporting documents have been produced by the appellants. Therefore, these services are not eligible to be considered as eligible input service.
Rent-a-Cab service - HELD THAT:- The adjudicating authority had given a finding that even though the services have been availed prior to 01.04.2011, that may not be the ground to allow these services as eligible input service. In this regard, it is found that it is an undisputed fact that such services have been availed by the appellants for the period upto 31.03.2011 for claiming as eligible input credit and not thereafter. The CBIC in its Circular No.943/4/2011-CX dated 29.04.2011 had clarified that the credit available on rent-a-cab service received before 01.04.2011 should be available as input credit if its provision had been completed before 01.04.2011even though the invoices could have been received subsequently i.e., after 01.04.2011 - Rent-a-Cab services received prior to 01.04.2011 in the present case is eligible input service, for taking CENVAT Credit.
Ship management services - transport services through waterways - sound recording service - HELD THAT:- The adjudicating authority had found that no invoice have been produced by the appellants before him to substantiate the nature of such service and its usage in provision of output service. Further, in respect of ‘short term accommodation service’, the adjudicating authority had found that such stays by the employees traveling for work are more in the nature of personal consumption. It is not required to examine the factual aspect as no invoices or supporting documents have been produced by the appellants for such services - these services are not eligible to be considered as eligible input service.
Denial of input credit on the ground that the address of the premises are not included in the registration certificate - HELD THAT:- The appellants had submitted a letter for inclusion of unregistered premises in the Service Tax Registration certificate by submission of their application for addition of such addresses to the jurisdictional authority on 17.10.2008. Inasmuch as the process of revising or updation of registered certificate with additional/new addresses for new branches/ office is a deemed approval procedure on intimation basis as priced under Service Tax Rules, 1944. Further, as the appellants is a regular assessee/ registrant with the Service Tax authorities, the input credit cannot be denied on such procedural lapses and that too for the failure to approving such amendments by the department within the prescribed time.
Conclusion - i) The impugned order is set aside, to the extent it has confirmed the Cenvat demand on the taxable services namely, Event Management & Mandap Keeper Service, General Insurance & Insurance Auxiliary Service and GTA Service and the appeal is allowed in favour of the appellant. ii) The Rent-a-Cab services received prior to 01.04.2011 in the present case is eligible input service, for taking CENVAT Credit. iii) The input credit cannot be denied on such procedural lapses and that too for the failure to approving such amendments by the department within the prescribed time.
Appeal allowed in part.
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2025 (3) TMI 61
Entitlement to concessional rate of tax - inter-state sale - Rejection of application filed by the writ petitioner on the ground that the tribunal cannot issue the direction sought for - HELD THAT:- It is required to be seen as to what remedy the petitioner is entitled to. Form-C declaration have been held to be documents when produce by the dealer, they will be entitled to benefit of the concessional rate of tax or reduced rate of tax. There are several decisions which have been pointed out and even if there is a defect in Form-C declaration issued in respect of an inter-State sale the same can be rectified and if there is a delay in issuance of Form-C declaration by the assessing officer of the purchasing dealer and if the Form-C declaration is issued belatedly, such declaration can be produced before the jurisdictional assessing officer of the selling dealer and the assessment for the relevant period can be revised.
In the instant case, the factual position is much better as the respondent/department does not dispute the fact that the transaction done by the writ petitioner with the 7th respondent is a case of inter- State sale. There may be cases where the purchasing dealer might have faced action by the department including that of cancellation of registration and there are decisions which have held that if the registration of the selling dealer is valid during the period when the inter-State sale took place, then the selling dealer would be entitled to the concessional rate of tax.
More or less an identical issue was decided by the Division Bench of this court in the case of Commissioner of Commercial Taxes and Another v. Tata Steel Limited and Others [2022 (11) TMI 1274 - CALCUTTA HIGH COURT] - It is informed the said decision though the appeal was filed against the said order before the Hon’ble Supreme Court, subsequently, the State Government accepted the decision and the concessional rate of tax was extended to the assessee therein, namely, Tata Steel Limited. Though this writ petition arises out of a challenge to an order passed by the learned tribunal yet this court is not denude of jurisdiction to do substantial justice in the instant matter in exercise of its powers under Article 226 of the Constitution of India, particularly when facts are not in dispute, that the transaction between the writ petitioner and the 7th respondent is a case of inter-State sale.
Conclusion - The petitioner was entitled to the concessional tax rate of 2% for the inter-State sale based on the admitted facts and the 6th respondent's acknowledgment.
The writ petition is disposed of by directing the 6th respondent to address a letter to the writ petitioner to the effect that the subject sale transaction is admittedly an inter-State sale, and Form-C declaration is not being able to be issued as the 7th respondent has not filed any application for issuance of Form-C declaration.
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2025 (3) TMI 60
Interest on Refund of the stamp duty paid on a lost e-stamp paper - whether the court should fold its hands and deny relief to a person, who has lost the e-stamp paper, only because the draftsman has omitted the use of such expression explicitly in the Statute? - HELD THAT:- When a person is deprived of the use of his money to which he is legitimately entitled, he has a right to be compensated for the deprivation which may be called interest or compensation. Interest is paid for the deprivation of the use of money in general terms which has returned or compensation for the use or retention by a person of a sum of money belonging to other.
In the case of Secretary, Irrigation Department, Government of Orissa v. G.C. Roy, [1991 (12) TMI 268 - SUPREME COURT], a Constitution Bench of this Court opined that a person deprived of use of money to which he is legitimately entitled has a right to be compensated for the deprivation, call it by any name. It may be called interest, compensation or damages. This is also the principle of Section 34 of the Civil Procedure Code.
Interest of normal accretion on capital - HELD THAT:- If on facts of a case, the doctrine of restitution is attracted, interest should follow. Restitution in its etymological sense means restoring to a party on the modification, variation or reversal of a decree or order what has been lost to him in execution of decree or order of the Court or in direct consequence of a decree or order. The term “restitution” is used in three senses, firstly, return or restoration of some specific thing to its rightful owner or status, secondly, the compensation for benefits derived from wrong done to another and, thirdly, compensation or reparation for the loss caused to another.
In Hari Chand v. State of U.P. [2011 (2) TMI 1638 - ALLAHABAD HIGH COURT], the Allahabad High Court dealing with similar controversy in a stamp matter held that the payment of interest is a necessary corollary to the retention of the money to be returned under order of the appellate or revisional authority. The High Court directed the State to pay interest @ 8% for the period, the money was so retained i.e. from the date of deposit till the date of actual repayment/refund.
Considering the reasons assigned by the learned Single Judge while taking the view that the respondents could not have declined to refund the amount and the fact that the retention of the said amount was for a long time and further the appellants were left with no other option but to approach the High Court, it is opined that the appellants are entitled to have interest on Rs. 28,10,000/-.
Conclusion - Interest is not a penalty or punishment at all, but it is the normal accretion on capital. The appellants are entitled to hae interest.
Appeal disposed off.
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2025 (3) TMI 59
Challenge to validity of Section 16(2)(aa) of the CGST Act, 2017/Assam Goods and Services Tax Act, 2017 as well as the validity of Section 16(2)(c) of the said Acts - Revenue has submitted that he has no objection if the challenge to the Section 16(2)(c) of CGST Act/AGST Act is decided in terms of the decision dated 05.08.2024 [2024 (8) TMI 836 - GAUHATI HIGH COURT] - HELD THAT:- The matter requires consideration.
List the matter for hearing in due course.
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2025 (3) TMI 58
Challenge to detention order and penalty - discrepancies in the E-way bill - HELD THAT:- It is not in dispute that by either of the parties that the goods were dispatched along with genuine documents for display in Aahar Exhibition organized at Pragati Maidan, New Delhi to which a delivery challan as prescribed under Section 55 (1) was issued along with E-way bill and material entry slip at Pragati Maidan and when on 18.03.2023, the goods were returned, again a delivery challan along with exit material slip and the E-way bill was issued as per the provision of the Act. Only a technical error was creeped out i.e. the place of dispatch of goods was mentioned as Ghaziabad in place of New Delhi.
This Court in the case of The Commissioner Commercial Tax U.P. Lucknow Vs. S/S Saurabh Traders Railway Bus Stand Pilkhuwa Hapur [2020 (1) TMI 752 - ALLAHABAD HIGH COURT] has held 'the Officer managing the check post after verifying the goods on the basis of other documents available at that point of time and have filled up the blank column of Form 38 and there was no occasion for imposing penalty, as has been done by the Assessing Officer.'
Further, the record shows that the authorities have not recorded any finding that the petitioner had intention to evade payment of tax, which is mandatory under the Act.
This Court in the case of Vacmet India Ltd. [2023 (10) TMI 863 - ALLAHABAD HIGH COURT] has held that if the goods are not taxable and accompanied with genuine documents, the proceedings are not justified.
The proceedings cannot be justified in the eyes of law - Petition allowed.
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2025 (3) TMI 57
Seeking grant of regular bail - fraudulent availment of Input Tax Credit - passing of ITC through five firms/companies without supply of relevant goods - offences under Section 132(1)(b) & (c) Central Goods and Services Tax Act, 2017 - HELD THAT:- This Court finds that as per the prosecution, the accused-applicants are directors of M/s Siwon Enterprises Pvt. Ltd. and M/s MS Singhal Trading India Pvt. Ltd., who were allegedly involved in arranging fake invoices for various buyers or end-users in order to pass on fake Input Tax Credit to them, and they also arranged availment of fake Input Tax Credit in the fake firms, and in return the accused-applicants had been receiving commission in cash. A perusal of the complaint/charge sheet dated 13.12.2024 would show that the applicants were associated in investigation on 16.10.2024 and their statements under Section 70 Central Goods and Services Act, 2017 were recorded, and as per these statements the accused had given the separate lists of suppliers and recipients of their above noticed two firms.
The complaint/ charge sheet dated 13.12.2024 though is silent about number of the beneficiaries, but according to the additional counter affidavit dated 10.2.2025, total 1267 persons received the benefit of fraudulent Input Tax Credit, however neither their particulars have been given in the additional counter affidavit nor the amount of commission received by the applicants has been disclosed. The sole piece of evidence relied upon by prosecution regarding involvement of accused-applicants with fake firms is the confession of the applicants recorded under Section 70 Central Goods and Services Tax Act, 2017, but the truthfulness of the same would be tested during trial, which is yet to commence.
Admittedly, the alleged offences are triable by magistrate and carry a maximum punishment of five years. As far as the investigation relating to the applicants is concerned, the same has been completed, as the complaint/ charge sheet dated 13.12.2024 has been filed against the applicants and their firms, whereupon the cognizance order dated 13.12.2024 has also been passed. However, the charges against the accused-applicants have not been framed and trial is yet to start - keeping in view the nature of the trial, period of more than five months undergone by the applicants as an undertrial as well as the fact that there is no likelihood of conclusion of trial in near future, this Court deems it appropriate to extend the concession of regular bail to the applicants, as their further detention behind the bars would not serve any useful purpose.
Conclusion - Bail is granted holding that detention was not justified given the completion of the investigation and the lack of immediate trial commencement.
The bail application is allowed and it is ordered that the applicants–Vikrant Singhal and Sachin Singhal be released on regular bail in the above case subject to their furnishing the requisite bail bonds and surety bonds to the satisfaction of the trial court.
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2025 (3) TMI 56
Maintainability of petiiton - availability of alternative remedy - Validity of ex parte order passed by the Principal Commissioner declaring the petitioner liable for Service Tax - violation of principles of natural justice - HELD THAT:- In the facts of the present case, what is evident to this Court is that learned counsel for the petitioner had withdrawn CWJC No. 9292 of 2010 with liberty to take recourse to such alternative remedies as are otherwise available in accordance with law. No doubt, this Court granted liberty to the petitioner to file a fresh writ petition on the same and subsequent cause of action if the need so arise, that would not have any bearing on the present case where admittedly the petitioner has got an alternative remedy of appeal and in fact, in order to avail that remedy, the petitioner had already deposited 7 ½ percent of the pre-deposit requisite amount.
In the case of Godrej Sara Lee Ltd. vs. Excise and Taxation Officer-cum-Assessing Authority and Others [2023 (2) TMI 64 - SUPREME COURT], the Hon’ble Supreme Court has taken a view as to the circumstances under which the petitioner may be relegated to the alternative remedy of appeal.
In the totality of the facts and circumstances, it is refrained from entertaining the writ application at this stage and relegate the petitioner to statutory remedy of appeal, if so advised - If a duly constituted appeal is preferred by the petitioner within a period of eight weeks from today, the same shall be considered by the Appellate Authority and in case, a question of limitation arises for consideration, the Appellate Authority shall consider the same keeping in view the fact that the petitioner was pursuing this writ application since the date of its presentation in the Registry on 19.08.2024. The period spent before this Court would be liable to be excluded.
Conclusion - The High Courts have discretion to entertain writ petitions based on policy, convenience, and discretion. The Court may relegate parties to statutory remedies if an effective alternative remedy exists.
Application disposed off.
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2025 (3) TMI 55
Violation of principles of natural justice - appellate authority has failed in granting opportunity of hearing to the petitioner - HELD THAT:- The appellate authority has strictly adhered to the principles of natural justice by providing the petitioner with opportunity of hearing, as mandated under Section 107(9). This Court finds that the procedural requirements laid down in the said provision have been duly complied with before passing the impugned order.
Moreover, this Court notes that all the grounds raised by the petitioner, have been thoroughly examined and considered by the appellate authority while rendering its decision dated 22nd November 2024. There is nothing on record to suggest that any material aspect has been overlooked or that there has been any violation of procedural fairness.
Petition dismissed.
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2025 (3) TMI 54
Challenge to SCN issued u/s 73 and 74 of the Central Goods and Services Tax Act, 2017/Kerala State Goods and Services Tax Act, 2017 - non-compliance with the period stipulated for completing the audit - HELD THAT:- The audit contemplated under Section 65 of the CGST Act stipulates that it shall be completed within a period of three months from the date of commencement of the audit. The Commissioner is given the power to extend the said period by a further period not exceeding six months. However, the explanation to the aforesaid provision stipulates that the commencement of the audit shall mean the date on which the records and other documents called for by the Tax Authorities are made available or the actual institution of audit at the place of business whichever is later. Though a question can arise whether the time limit is mandatory or only directory in view of the use of the word 'shall', the said question is left open for consideration in appropriate case, considering the circumstances of this case.
The hearing notice dated 26.03.2024 and 02.04.2024 have not been produced. However, it is evident from the Ext.P5 communication issued by the petitioner itself that additional evidences were called for by the respondents from the petitioner. The said additional records are stated to have been produced on 09.04.2024, as seen from Ext.P5. Therefore, it can safely be concluded that the date on which the documents called for by the respondents were produced by the petitioner on 09.04.2024.
It is necessary to refer to the Explanation to Section 65 which stipulates that the expression 'commencement of audit shall mean the date on which the records and documents called for by the Tax Authorities are made available by the registered person'. Viewed in the above perspective, the documents called for by the Tax Authorities were made available by the petitioner on 09.04.2024 and the audit ought to have been completed within three months from the aforesaid date. Since the final report was filed within time, the contention raised by the petitioner on the basis of limitation stipulated in Section 65(4) of the GST Act has no application.
Conclusion - The audit was completed within the prescribed period - The petitioner's argument regarding the audit's timeliness under Section 65(4) of the GST Act was deemed inapplicable.
There are no merit in this writ petition and it is dismissed.
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2025 (3) TMI 53
Imposition of fine in lieu of confiscation - allegation is that the Appellate Authority had wrongly reduced the fine in lieu of confiscation - HELD THAT:- The entire quantity of gold seized (presently in the custody of the Department) shall be released to the petitioner on the petitioner executing bonds in the manner and form required by the Senior Enforcement Officer, Enforcement Squad, State Goods & Services Tax Department, SGST Complex, Palakkad.
The property having an extent of 6 Ares and 7 Sq. metres in Survey No.73/4-435 of Potta village, Chalakkudy Taluk, Thrissur District shall be accepted as security for the release of the seized gold pending adjudication of the matter by the Tribunal - The owner of the property (father of the petitioner in W.P.(C.) No.20073 of 2024) will file an affidavit and undertake that he will not alienate or further encumber the property referred to above until culmination of proceedings before the Tribunal.
Petition disposed off.
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2025 (3) TMI 52
Can a person who enters into a contract with the Government or its agencies that contains a specific clause that the rate quoted shall be inclusive of ‘GST & other taxes’ turn around and claim that he is entitled to Goods & Services Tax (GST) over and above the rate quoted by him? - HELD THAT:- A reading of the letters/instructions referred to in the writ petitions clearly show that, those Circulars/letters/instructions do not apply in a case where the Notice Inviting Tender or the agreement executed between the contractor and the tendering agency clearly specified that the rates quoted shall be deemed to be inclusive of GST. Though certain portions of the letter dated 07.05.2024 and the illustrations given therein, at first blush, appear to support the case of the petitioner, on closer scrutiny, it must be held that even those instructions do not support the case of the petitioner. The Circulars/instructions referred to above deal with the preparation of estimate and not with the final tendering process. It clarifies that while preparing estimates for the purpose of administrative/financial sanction, the estimates must be prepared without including GST element.
The submission of the learned Government Pleader that if the contention of the petitioner were to be accepted, the sanctity of the tendering process itself will be affected is only to be accepted. This can be illustrated by means of an example. When the tender document/agreement contemplated that the rates quoted shall be deemed to be inclusive of GST and the successful bidder quotes Rs. 100/- for a particular item of work, he cannot be permitted to, thereafter, turn around and claim that he must be given Rs. 100/- plus 18% GST (total of Rs. 118) as there may have been situations where another bidder, after noticing the conditions in the tender document would have quoted Rs. 105/- inclusive of GST and would not have become successful on account of the fact that the successful bidder has quoted only Rs. 100/-. In such a situation, if the successful bidder is allowed to claim 18% GST over and above the rate of Rs. 100/- quoted by him, the Government/its agencies would end up paying Rs. 118/- which obviously, cannot be accepted.
Conclusion - The contractor was not entitled to claim GST over and above the quoted rates specified in the contract agreements.
There are no merit in these writ petitions and they are dismissed in limine.
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2025 (3) TMI 51
Validity of Final assessment order due to non-compliance with the principles of natural justice - failure to grant a personal hearing as required u/s 144B - HELD THAT:- We are unable to agree with the submissions advanced by Respondents, one on the ground of availability of alternate statutory remedy to the petitioner which ought to have been exhausted before approaching this Court in writ jurisdiction. Such submission, in the given facts, would fall foul of the statutory mandate u/s 144B of the IT Act, which embraces the right to be heard, failing which the order would be without jurisdiction and non est.
In the given facts and circumstance, it would be unfair and unjust to the petitioner to be left entangled in litigation before the appellate authority and thereafter, in further appeals which are available, as the foundational illegality in a situation like the present, would have to be nipped in the bud. In such situation, the appellate remedy may not be effective or efficacious, considering the patent illegality in the impugned final assessment order.
We express our inability to agree with the submission of Respondents to the effect that the petitioner in this case did not comply with the timelines clearly set out in draft assessment order to submit its response on the e-filing portal on or before 18:00 hours of 26 August 2022.
Petitioner did submit such response with a categorical reques to be heard through video conferencing. Thus, according to Respondents when such specific timelines are not adhered to by the petitioner, the consequences ought to follow. The sequel to such submissions would mean shutting the doors of this Court to the petitioner merely because of a delay of merely one day in submitting its response as provided in the show cause notice-cum-draft assessment order. Also, accepting such submissions would tantamount to bypassing the clear statutory mandate u/s 143 (3) read with 144B of the IT Act, as interpreted by the decisions cited above. We, therefore, cannot accept justice becoming a casualty to technicalities by adopting a hyper-technical approach.
38. We may now refer to Section 156 of the IT Act which provides for the demand notice to be issued in case of any failure to pay tax by the assessee. In the present case, it is pertinent to note that such demand notice is issued pursuant to the impugned final assessment order of the said date. Therefore, when such demand notice is premised upon the impugned assessment order which itself is without jurisdiction and non est as observed any actions including issuance of consequential notices would not stand legal scrutiny.
Penalty notices u/s 274, 270A r/w Section 271AA (1) - We note that notice/order under a statutory provision which would entail civil consequences causing prejudice to the person, ought to be passed in strict adherence to the principles of natural justice to include opportunity of being heard.
As decided in UMC Technologies Private Limited v. Food Corporation of India and Another [2020 (11) TMI 966 - SUPREME COURT] to state that it is the first principle of civilized jurisprudence that a person against whom any action is sought to be taken or interest are being affected should be given a reasonable opportunity to defend himself to include the right to be heard, before an order entailing such consequence is passed. Thus, we are unable to accept the submission of Respondents on the penalty notices issued by the respondents - WP allowed.
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2025 (3) TMI 50
Reopening of assessment u/s 147 - reasons to believe - relaince on information collected by virtue of the procedure prescribed under the scheme notified u/s 135A - cash deposit is unverified on account of the assessee having failed to submit any valid justification or satisfactory documentary evidences for the same - HELD THAT:- While issuing the impugned notice u/s 148 the respondents by pure inadvertence have annexed/attached the information pertaining to some other individual/assessee and not the petitioner. The said aspect appears to be an error or mistake and neither deliberate nor wilful.
On account of such error/mistake or inadvertence, no fatality can be said to attach to the issuance of the impugned notice u/s 148 of the Act. However, at the same time, the passing of the impugned order dated 03.02.2025 is absolutely unsustainable in overlooking the error apparent on the face of the record. It can be safely presumed that the authority did not apply its mind to the objections raised by the petitioner.
We are of the considered opinion that the impugned notice issued u/s 148 to the extent that it reflects information of some other person, shall be rectified by the respondents. The appropriate and correct information available on the Insight Portal as also the Approval accorded by the Specified Authority alongwith the relevant information shall be made available to the petitioner within a week from date to enable him to file his reply/objections which may be considered strictly in accordance with law.
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2025 (3) TMI 49
TDS u/s 194C OR 194J - payments made by the assessee to IGSPT for services received - ITAT justiciation in not upholding the order of the A.O. that tax was deducted at source by the assessee from the above payments u/s 194J wherein services received by the assessee is technical and professional in nature.
HELD THAT:- In this case, the CIT (Appeals) and ITAT have recorded concurrent findings that the agreement entered into by the assessee with the IGSPT did not involve providing any professional / managerial / technical expertise services to the assessee. The two authorities have recorded concurrent findings of fact that the agreement concerned providing a call centre. The service executives were generally undergraduates or graduates of any stream who would act in a particular manner consistent with the prescribed guidelines when attending to the subscribers' complaints.
The above findings of fact are supported by the terms of the agreement between the assessee and IGSPT and the other material on record, such as the details of the call service executives, their qualifications, and the nature of work they discharged. Therefore, the concurrent findings of fact cannot be said to suffer from perversity either because they are based on no evidence or because they are contrary to the weight of the evidence on record.
ITAT has recorded that the service providers to whom the assessee made the payments have already paid the appropriate taxes by way of advance tax / self-assessment tax. Thus, the ITAT has held that the law laid down by the Hon’ble Supreme Court in the case of Hindustan Coca-Cola Beverage (P.) Ltd. [2007 (8) TMI 12 - SUPREME COURT] has also been substantially complied with by the assessee.
Accordingly, we are satisfied that this case does not involve any question of law.
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2025 (3) TMI 48
Validity of reopening notice - according to the petitioner, the notice lacked jurisdiction and impugned notice was ex facie without jurisdiction and not deserving of any response - HELD THAT:- Given the facts of the present case and considering the Petitioner's attitude of not responding to the notices, no case is made to exercise our extraordinary jurisdiction and interdict further assessment proceedings. If the Petitioner is confident about his version, he may possibly get relief in the assessment proceedings. In any event, he can always question the assessment orders through the regular channels of appeals, etc., available under the IT Act. Accordingly, no case is made to entertain this Petition.
In this matter, an investigation into disputed facts would also be necessary. Even the limitation issue, in the peculiar facts of this case, would be a mixed question of law and fact. As noted earlier, this is not a fit case to exercise our discretion and interdict the proceedings. Any such stalling of proceedings will impact the assessments of various assessees covered by the allegations in the communication dated 12 March 2021. This communication refers to the vast amount of monies stacked in Shri Renuka Mata Multi-State Urban Cooperative Credit Society Ltd and the modus operandi adopted by various assesses in hoarding and laundering these amounts.
We are satisfied that the Petitioner will have ample opportunities to defend himself during the assessment proceedings. Should the assessment proceedings prejudice the Petitioner, then, in the regular remedies provided under the IT Act, question such assessment proceedings.
We dismiss this Petition and vacate the ad interim relief for all the above reasons.
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2025 (3) TMI 47
Revision u/s 264 - claim of long term capital gains made - whether the AO was right in rejecting the stand taken by the assessee and holding that the date of acquisition of the subject property should be reckoned as 18.3.2008, when the agreement for sale was executed and registered in terms of the Maharashtra Apartment And Ownership Act and not from the date of allotment, namely, 1.8.2006.
HELD THAT:- The definition of transfer as defined under the Transfer of Property Act should not be emerged while considering whether a transaction is a transfer under the provisions of the Income Tax Act.
Undoubtedly, on the date of allotment, namely, 1.8.2006 a right has accrued in favour of the appellant/assessee. This is more so because the developer has accepted that the assessee has paid a sum of Rs.3,13,000/- by cheque dated 29.7.2006 which was prior to the allotment order dated 1.8.2006.
The revenue does not dispute the fact that the payment schedule has been adhered to by the assessee and ultimately on the date when the agreement for sale was executed, namely, 27.12.2007, 82.5% of the entire sale price payable has been paid by the assessee. Prior to the date of sale in favour of the third party which took place on 29.4.2010 the entire consideration has been paid by the assessee which has been acknowledged by the developer. All these payments are a consequence of an allotment made on 1.8.2006 and, therefore, it has to be held that the right over the property in question accrued in favour of the assessee as on the date of allotment i.e. 1.8.2006.
Undoubtedly, the letter of allotment and the payment made thereafter has created in favour of the assessee an interest in the asset directly and it was by way of an agreement/or otherwise.
It would be beneficial to take note of the decision of the Hon’ble Supreme Court in Saraswati Devi v. Delhi Development Authority and Others [2013 (1) TMI 1058 - SUPREME COURT] for the purpose of understanding as to what would the term encumbrance mean.
The word “encumbrance” imports within itself every right or interest in the land, which may subsist in a person other than the owner; it is anything which places the burden of a legal liability upon property. Further it was held that the word “encumbrance” in law has to be understood in the context of the provision under consideration but ordinarily its ambit and scope is wide.
Thus, apart from the definition of the word “encumbrance” as explained in the aforementioned decision, it should be understood in the context of the provision under consideration which, in our instant case, is the Income Tax Act.
Undoubtedly, a direct interest on the property stood created in favour of the assessee as and when the letter of allotment was issued, namely, 1.8.2006 because prior to the date of letter of allotment, the payment was made by the assessee in July, 2006 which has been acknowledged in the letter of allotment.
Therefore, we are of the view that the order passed by the PCIT as well as the assessment order calls for interference.
Accordingly, this appeal is allowed. The order passed in the writ petition is set aside and the writ petition is allowed.
The matter is remanded back to the assessing officer with the direction to take note of the date of allotment, namely, 1.8.2006 as the date of transfer of the subject asset in favour of the assessee and accordingly, the assessment shall be completed.
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2025 (3) TMI 46
Reopening of assessment u/s 147 - Reason to believe - lack of specific information, such as the name of the bank - information relied upon for reassessment and outcome of enquiry if conducted any, is to be supplied - HELD THAT:- From perusal of the reasons annexed with the notice issued under Section 148A(b) of the Act, it is evident that name of the bank in which the account was maintained is not mentioned. Inspite of the mandate of Section 148A of the Act, circulars and guidelines issued by the department that material relied upon should be supplied to the assessee, the casualness in which the reasons are supplied, is evident. Vague information was supplied and in absence of name of bank it becomes impossible for the assessee to file response.
AO's decision to proceed with the notice despite the petitioner's objections - The petitioner filed objections denying that the account number does not belong to it, giving details of the bank account with the ICICI Bank which was closed, the proof thereof was annexed. The AO issued notice to the bank on 25.03.2022 and without waiting for reasonable time or giving reminder or making any efforts to verify the fact from the bank, brushed aside the objections stating that no response has been received from the bank.
In the reply filed by respondent before this court, the e-mail received from the bank that the account of the petitioner with the ICICI Bank was closed in the year 2010 and further that the account number mentioned in the notice does not exist with the ICICI Bank has not been denied.
The e-mail was of April and May, 2022 and respondent filed reply on 22.02.2023 i.e. almost eight months after receipt of the e-mail. In reply filed, there is no pleading that the bank account number mentioned in the notice was of some other bank than ICICI or that there is even a prima-facie material with the department that the bank account mentioned in the notice belonged to the petitioner. There is no reason put-forth for hurriedly passing the impugned order within five days of sending email.
The objections were not decided in accordance with Section 148A and the guidelines issued for procedure to be followed in proceedings under Section 148A of the Act.
Even before this Court, the department miserably failed to put an iota of evidence to even prima-facie show that the bank account mentioned in the notice belonged to the petitioner and even at this stage, the name of the bank of which account number belongs is not disclosed. WP allowed.
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2025 (3) TMI 45
Addition u/s 68 - cash deposited in banks during the demonetization period - specific case of the Assessee that the cash deposited during the demonization was out of the cash withdrawal from the bank and the entirety of the cash withdrawals were from the regular bank account maintained in the usual course of business - HELD THAT:- AO has accepted the books of accounts of the Assessee and no defects or discrepancies of any source in the purchase and sales and stocks have been pointed out by the AO, further the A.O. has also not doubted the fact that the source cash as enduring to the Assessee from its business activities, further it is not the case of the A.O. that the inflow of cash from any activity other than business of the Assessee.
A.O. failed to look into the history of the Assessee wherein it is found that the Assessee used to deposit the cash in the bank in the months preceding demonization. CIT(A) has committed error in upholding the addition made by the A.O., accordingly, we delete the addition - Appeal filed by the Assessee is allowed.
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