TMI Tax Updates - e-Newsletter
January 18, 2025

Case Laws in this Newsletter:

GST Income Tax Benami Property Customs Corporate Laws Insolvency & Bankruptcy PMLA Service Tax Central Excise Indian Laws

Articles

1. Updates on suggestion for Income Tax Act Revamp (Comprehensive Review) from 1st February 2025 as announced by the Union Finance Minister in The Budget (No.2) in 2024. Merging Provisions, Explanations & Illustrations in the Act; Inculcate provisions for increasing accountability of officers & Introducing Ease of Compliance

   By: Vivek Jalan

2. India’s Semiconductor Sector: A Strategic Opportunity Amid U.S. AI Chip Export Controls

   By: DrJoshua Ebenezer

3. DISLOSURES TO BE MADE BY A COMPANY UNDER THE COMPANY LAWS

   By: DR.MARIAPPAN GOVINDARAJAN

4. Telecom towers are moveable property which are eligible for ITC

   By: Bimal jain

5. Denied Entity List (DEL)

   By: YAGAY andSUN

6. Apparel Export from India: Overview, Compliances, Restrictions, and Future Trends

   By: YAGAY andSUN

7. Track and Trace Scheme for Export of Pharmaceuticals

   By: YAGAY andSUN

News

1. Budget session likely between January 31 and April 4

2. Rajasthan CM meets employee unions ahead of budget session

3. Exponential Growth in Digital Transactions

4. India's economic growth poised to rebound, says RBI Bulletin

5. ED attaches Rs 68-cr worth assets of Vatika Ltd. in PMLA case

6. Indore SEZ exports fall by 6.50 pc due to fewer orders from pharmaceutical units

7. Shri Piyush Goyal launches PRABHAAV Factbook, Bharat Startup Challenge on 9th Foundation Day of Startup India

Notifications

Customs

1. 02/2025 - dated 16-1-2025 - Cus

Seeks to amend Notification No. 19/2019-Customs, dated the 6th July, 2019

2. 01/2025 - dated 16-1-2025 - Cus

Seeks to exempt imports by the inspection team of IAEA.

GST

3. 08/2025 - dated 16-1-2025 - CGST Rate

Seeks to amend Notification No 17/2017-Central Tax (Rate), dated 28th June, 2017 to implement the recommendations of the 55th GST Council.

4. 07/2025 - dated 16-1-2025 - CGST Rate

Seeks to amend Notification No 13/2017-Central Tax (Rate), dated 28th June, 2017 to implement the recommendations of the 55th GST Council..

5. 06/2025 - dated 16-1-2025 - CGST Rate

Seeks to amend Notification No 12/2017-Central Tax (Rate dated 28th June, 2017 to implement the recommendations of the 55th GST Council.

6. 05/2025 - dated 16-1-2025 - CGST Rate

Seeks to amend Notification No 11/2017 - Central Tax (Rate) dated 28th June, 2017 to implement the recommendations of the 55th GST Council.

7. 04/2025 - dated 16-1-2025 - CGST Rate

Seeks to amend Notification No. 8/2018-Central Tax (Rate), dated the 25th January, 2018

8. 03/2025 - dated 16-1-2025 - CGST Rate

Seeks to amend Notification No. 39/2017-Central Tax (Rate), dated the 18th October, 2017

9. 02/2025 - dated 16-1-2025 - CGST Rate

Seeks to amend Notification No. 2/2017- Central Tax (Rate), dated the 28th June, 2017

10. 01/2025 - dated 16-1-2025 - CGST Rate

Seeks to amend Notification No. 1/2017- Central Tax (Rate), dated 28th June, 2017

11. 01/2025 - dated 16-1-2025 - GST CESS Rate

Seeks to prescribe Compensation cess rate of 0.1% on supply of taxable goods by a registered supplier to a registered recipient for export subject to specified conditions.

12. 08/2025 - dated 16-1-2025 - IGST Rate

Seeks to amend Notification No 14/2017-Integrated Tax (Rate), dated 28th June, 2017 to implement the recommendations of the 55th GST Council.

13. 07/2025 - dated 16-1-2025 - IGST Rate

Seeks to amend Notification No 10/2017-Integrated Tax (Rate), dated 28th June, 2017 to implement the recommendations of the 55th GST Council.

14. 06/2025 - dated 16-1-2025 - IGST Rate

Seeks to amend Notification No 9/2017-Integrated Tax (Rate), dated 28th June, 2017 to implement the recommendations of the 55th GST Council.

15. 05/2025 - dated 16-1-2025 - IGST Rate

Seeks to amend Notification No 8/2017- Integrated Tax (Rate), dated 28th June, 2017 to implement the recommendations of the 55th GST Council.

16. 04/2025 - dated 16-1-2025 - IGST Rate

Seeks to amend Notification No. 9/2018-Integrated Tax (Rate), dated the 25th January, 2018

17. 03/2025 - dated 16-1-2025 - IGST Rate

Seeks to amend Notification No. 40/2017-Integrated Tax (Rate), dated the 18th October, 2017

18. 02/2025 - dated 16-1-2025 - IGST Rate

Seeks to amend Notification No. 2/2017-Integrated Tax (Rate), dated the 28th June, 2017

19. 01/2025 - dated 16-1-2025 - IGST Rate

Seeks to amend Notification No. 1/2017-Integrated Tax (Rate), dated the 28th June, 2017

20. 08/2025 - dated 16-1-2025 - UTGST Rate

Seeks to amend Notification No 17/2017-Union Territory (Rate), dated 28th June, 2017 to implement the recommendations of the 55th GST Council.

21. 07/2025 - dated 16-1-2025 - UTGST Rate

Seeks to amend Notification No 13/2017 - Union Territory (Rate), dated 28th June, 2017 to implement the recommendations of the 55th GST Council.

22. 06/2025 - dated 16-1-2025 - UTGST Rate

Seeks to amend Notification 12/2017- Union Territory Tax (Rate), dated 28th June, 2017 to implement the recommendations of the 55th GST Council.

23. 05/2025 - dated 16-1-2025 - UTGST Rate

Seeks to amend Notification No 11/2017- Union Territory Tax (Rate) dated 28th June, 2017 to implement the recommendations of the 55th GST Council.

24. 04/2025 - dated 16-1-2025 - UTGST Rate

Seeks to amend Notification No. 8/2018-Union Territory Tax (Rate), dated the 25th January, 2018

25. 03/2025 - dated 16-1-2025 - UTGST Rate

Amendment in Notification No. 39/2017-Union territory Tax (Rate), dated the 18th October, 2017

26. 02/2025 - dated 16-1-2025 - UTGST Rate

Seeks to amend Notification No. 2/2017-Union Territory Tax (Rate), dated the 28th June, 2017

27. 01/2025 - dated 16-1-2025 - UTGST Rate

Seeks to amend Notification No. 1/2017-Union Territory Tax (Rate), dated 28th June, 2017

Circulars / Instructions / Orders

Customs

1. PUBLIC NOTICE NO. 03 / 2025 - dated 10-1-2025

Mandatory filing of arrival, departure and local manifests in accordance with SCMTR formats

Highlights / Catch Notes

GST

• Inherent cross-empowerment of State/UT GST officers u/s 6(1) CGST Act.

  Case-Laws - HC : HC held Section 6(1) CGST Act provides inherent cross-empowerment of State/UT GST officers as proper officers under CGST Act, without need for notification unless conditions imposed. Statutory mandate presently unqualified, subject to Government specifying conditions on Council's recommendation through notification.
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• Procedural lapses without fraud don't warrant harsh GST penalties: HC.

  Case-Laws - HC : Procedural irregularities without fraudulent intent do not warrant harsh penalties u/s 129 of GST enactments. HC quashed impugned order due to procedural nature of irregularities and absence of fraudulent intent. Petitioner's failure to register additional place of business and generation of E-way bill and invoices after detention considered technical and venial breach. Unless variance between invoice, E-way bill quantities and actual seizure, penalty u/s 129(3) of CGST Act harsh under facts.
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• GST on advance refundable if contract fails due to supplier non-performance.

  Case-Laws - HC : The HC held that the GST amount paid on an advance for a contract that was later rescinded due to non-performance by the supplier must be refunded. The levy of tax is on the transaction; if the transaction fails, what is paid in advance needs to be refunded. The HC directed the appellant to refund the GST amount to the respondent-assessee within eight weeks. The appeal was dismissed.
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Income Tax

• Tax demand upheld, non-payment not beyond petitioner's control (2A.

  Case-Laws - HC : Petitioner failed to establish non-payment of tax demanded was beyond their control. CC reasonably exercised powers u/s 220(2A) after considering relevant circumstances and material on record. Factual findings supported by evidence, no perversity. Chander Prakash Jain case distinguishable on facts, not involving Section 220(2A). HC does not exercise appellate jurisdiction. All three preconditions for waiver u/s 220(2A) not met. Petition dismissed.
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• Reassessment notice quashed due to low income, lack of approval u/s 151.

  Case-Laws - HC : The HC quashed the reassessment notice and consequential proceedings, holding that the reassessment action could not be sustained due to: (1) the alleged escaped income falling below the pecuniary threshold prescribed u/s 149(1)(b) as per the Supreme Court's ruling in Rajeev Bansal; and (2) the approval for reassessment not being granted by the competent authority u/s 151 after the introduction of the extended timelines by the Taxation Laws (Amendment) Act, 2021. The HC allowed the writ petition in favor of the assessee.
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• Reopening assessment beyond 4 years invalid sans new facts.

  Case-Laws - HC : The HC held that the reopening of assessment beyond four years was without jurisdiction as the reasons did not disclose any material facts that the assessee failed to disclose during the original assessment proceedings. Merely reproducing the proviso's wordings does not satisfy the jurisdictional condition for reopening. The reasons recorded were based on the assessee's case records filed during the assessment, which is impermissible for reopening after four years under the first proviso to Section 147. The HC ruled in favor of the assessee.
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• High Court denies full demand stay, directs 20% payment in installments.

  Case-Laws - HC : HC dismissed petition for complete stay of demand. Petitioner directed to pay 20% of Rs. 5.86 crore demand in 6 installments. Additions made by AO on account of non-genuine purchases based on search, statements and investigation. Petitioner failed to rebut findings or prove purchases were genuine. No prima facie case made out for full stay or financial incapacity shown to pay 20% demand.
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• Supreme Court dismisses writ petition, imposes Rs 1 lakh costs for vague prayers.

  Case-Laws - HC : Writ petition seeking mandamus to furnish information dismissed. HC held petition misconceived, warranting exemplary costs. Prayer clause vague, petitioner failed to disclose pending suit details and explain why RTI Act remedy not availed. Despite being satisfied regarding main prayer, petitioner did not withdraw petition for years, wasting judicial time. Petition dismissed with costs of Rs. 1 lakh payable to government hospital.
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• Electricity company's book profits exempt from MAT for AY 2006-07.

  Case-Laws - HC : HC held Section 115JB inapplicable to electricity company for AY 2006-07 as accounts not prepared under Companies Act 1956. Amendment aligning Section 115JB with regulatory Acts prospective from AY 2013-14. Book profit additions u/s 115JB deleted for AY 2006-07.
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• Assessee wins: Second income tax reopening notice barred by limitation.

  Case-Laws - HC : The HC held that the second notice issued u/s 148A(b) was a standalone notice, not a continuation of the first notice. The information on which the notices were based was completely different. As the second standalone notice was issued beyond the 3-year period stipulated u/s 149(1)(a) for reopening assessment where escaped income is less than Rs. 50 lakhs, it was barred by limitation. Consequently, the HC set aside the impugned order u/s 148A(d) and the notice u/s 148A(b), deciding in favor of the assessee.
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• Reopening assessment without independent opinion invalid.

  Case-Laws - HC : The HC held that the Assessing Officer could not reopen the assessment for AY 2013-14 merely relying on information from the insight portal without forming an independent opinion based on the assessee's records. The assessee had disclosed and offered to tax the loss from F&O transactions, which was scrutinized and accepted during regular assessment. Reopening on the same issue amounts to a change of opinion, which is impermissible. The reopening lacked tangible material and application of mind, rendering it invalid. The Court decided in favor of the assessee.
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• Assessee's appeal allowed against penalty order; CIT(A) to reconsider facts and grounds.

  Case-Laws - AT : ITAT allowed assessee's appeal against CIT(A)'s order u/s 270A for not considering assessee's submissions regarding substantial relief granted in quantum proceedings and grounds that additions were on account of ad-hoc apportionment of expenses. Matter restored to CIT(A) for de-novo adjudication after examining assessee's facts and grounds.
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• Assessee's appeal allowed, matter remanded to CIT(A) for fresh adjudication.

  Case-Laws - AT : CIT(A) directed to first adjudicate assessee's appeal against quantum assessment, determine business turnover, and whether assessee falls within Section 44AB for audit obligation before adjudicating penalty u/s 271B for failure to furnish audit report. ITAT set aside CIT(A)'s order, restoring matter to CIT(A) for fresh adjudication in interest of justice and fairness. Assessee's appeal allowed for statistical purposes.
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• Foreign travel expenses reimbursed by export company to Managing Director for official visits.

  Case-Laws - AT : Assessee was the founder and Managing Director of a company engaged in export of spices, pickles etc. Approximately 98% of the company's revenue came from exports. As the Managing Director, assessee was required to travel abroad, and the company reimbursed expenses incurred for official purposes directly to credit card companies as per policy. Considering the company's substantial export turnover of Rs. 159 crores, confirmation that reimbursements were for official visits, personal expenses not reimbursed, and travel expenses of only Rs. 4 crores against turnover, ITAT held that the addition made by the AO is liable to be deleted and decided in favour of the assessee.
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• Deduction u/s 80IA allowed for infrastructure development activities.

  Case-Laws - AT : ITAT allowed the assessee's claim for deduction u/s 80IA for development of infrastructure facilities. It held that merely entering into an agreement with the government or receiving payments from it does not disentitle the assessee from claiming deduction as a "developer" u/s 80IA(4). The assessee's activities qualified as development of new infrastructure facilities, following precedents. The department failed to distinguish the facts from favorable orders of higher authorities for prior years.
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• ITAT rules on offshore sale, foreign receipts for assessee.

  Case-Laws - AT : The ITAT held that identical issues arose in the assessee's own case for AY 2019-20 which was decided in favour of the assessee, thus there is no justification in attributing the profit on offshore sale of equipment. Regarding receipt from Glidepath, New Zealand, the ITAT found no artificial splitting of contracts and relied on the Supreme Court's decision in Morgan Stanley to hold that the receipt cannot be subjected to tax. For receipts from KITCOL, TTD and CIAL, the matter was restored to the AO to examine double taxation after the assessee furnishes evidence of offering the receipts in earlier years.
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• Cash deposits explained, reopening u/s 147 invalid: ITAT.

  Case-Laws - AT : The ITAT held that the reopening of assessment u/s 147 based on cash deposits during the year was invalid. The assessee demonstrated the source of cash deposits by proving withdrawal of Rs. 20 lakhs earlier, which was used for subsequent deposits from 28.10.2010 to 15.03.2011. Consequently, the ITAT allowed the assessee's grounds and deleted the addition made u/s 69A using the peak credit method.
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Customs

• Importer's classification of electric tricycle parts upheld, duty benefits granted.

  Case-Laws - AT : Importer's classification of imported goods as components/parts of Electric Tricycle/E-Rickshaw under CTH 87089900 upheld by CESTAT against Revenue's claim of classifying as complete E-Rickshaws in CKD condition under CTH 87038040. Benefit under Notification No. 50/2017-Cus granted. Revenue's enhancement of declared value rejected. Confiscation and penalties annulled. Revenue's appeals dismissed.
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• Customs tariff values revised for edible oils, metals, areca nuts w.e.f. 16/01/2025.

  Notifications : The Central Board of Indirect Taxes and Customs issued Notification No. 03/2025-Customs (N.T.) amending tariff values for import of edible oils like crude palm oil, RBD palm oil, crude palmolein, RBD palmolein, crude soyabean oil, brass scrap, gold, silver in any form, and areca nuts effective 16th January 2025 u/s 14(2) of the Customs Act 1962.
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• New Sea Cargo Manifest Rules deferred till 31-3-2025 for most ports.

  Notifications : The Central Board of Indirect Taxes and Customs amended the Sea Cargo Manifest and Transshipment Regulations, 2018, deferring the applicability of new regulations for ports (other than certain specified ports) till 31-3-2025 through the Sea Cargo Manifest and Transshipment (First Amendment) Regulations, 2025 notified on 15-1-2025.
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• Virochannagar, Ahmedabad Designated as Inland Container Depot for Imports/Exports.

  Notifications : The Central Board of Indirect Taxes and Customs amended Notification No. 12/97-Customs (N.T.) to include Virochannagar, Ahmedabad as an Inland Container Depot in Gujarat for unloading imported goods and loading export goods.
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• Baggage Rules: Unclear jewellery import rules challenged in High Court.

  Case-Laws - HC : HC directed CBIC to reconsider Baggage Rules 2016, particularly provisions regarding declaration of jewellery by incoming international passengers. HC observed that Baggage Rules and Declaration Forms lack clarity on jewellery declaration norms. HC also noted that Rs. 1,00,000 value cap for duty-free jewellery import is unreasonably low considering current gold prices. CBIC to coordinate with relevant ministries, submit report on proposed revisions by next hearing.
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• CBIC appeal dismissed: MIMO Wireless Access Points exempt under Custom Tariff Item 8517(iv.

  Case-Laws - HC : The HC held that the word "and" in Custom Tariff Item 8517(iv) is to be read disjunctively. The exemption under amended Notification 24/2005-Cus applies to Wireless Access Points operating solely on MIMO technology. The respondent's imported WAPs employing MIMO but not LTE qualify for exemption from Basic Customs Duty. The phrase "MIMO and LTE Products" covers only products combining both technologies. The appeal by Revenue was dismissed.
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• Customs broker's license revocation, penalty set aside for notice delay, lack of evidence.

  Case-Laws - AT : Customs broker's license revocation and penalty set aside. CESTAT held time limit for issuing show cause notice under CBLR as mandatory, breached here. Charges under regulations 10(d) and 10(e) of CBLR not substantiated with evidence against customs broker's due diligence and proper advice to client. Impugned order unsustainable due to delay in issuing notice and lack of grounds. Appeal allowed.
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• Incorrect classification of imported cables and accessories due to lack of evidence.

  Case-Laws - AT : The CESTAT held that the classification of imported Optical Power Ground Wire Fibre Cable (OPGW) and accessories under CTH 9001 and 7616 respectively was incorrect. The authorities failed to provide conclusive evidence regarding the physical characteristics of the goods to justify the classification under Heading 9001. The CESTAT emphasized that classification must be based on actual physical characteristics, and authorities must gather product specifications, manufacturing process details, compliance with standards, contract copies, and expert opinions if required. Mere assumptions and presumptions are insufficient when the critical characteristic for classification, i.e., whether the fibres are individually sheathed or not, is ambiguous. The denial of exemption based on the incorrect classification was set aside.
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FEMA

• Revised RBI norms allow foreign inward remittances for equity, FPI, LLP, FVCI investments.

  Notifications : The RBI amended the Foreign Exchange Management (Mode of Payment and Reporting of Non-Debt Instruments) Regulations, 2019, revising provisions related to mode of payment and remittance of sale proceeds for investments by persons resident outside India. Key changes include allowing inward remittances through banking channels or from foreign currency/rupee accounts for equity, FPI, LLP, FVCI, investment vehicle and IDR investments. Sale/disinvestment proceeds can be remitted abroad or credited to foreign currency/rupee accounts. Convertible notes issued by Indian startups can be subscribed through inward remittances or foreign currency/rupee accounts, with repayment/sale proceeds allowed for outward remittance or credit to such accounts.
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• RBI eases fund transfers between repatriable rupee accounts, allows SNRR accounts.

  Notifications : RBI amended Foreign Exchange Management (Deposit) Regulations, 2016 permitting transfer of funds between repatriable Rupee accounts for bona fide transactions. It allowed opening of Special Non-Resident Rupee Account (SNRR) by persons outside India with authorised dealers or their foreign branches for current, capital account transactions with Indian, foreign residents. SNRR account tenure made concurrent to contract/business period. IFSC units permitted to open SNRR accounts with Indian banks outside IFSCs.
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Corporate Law

• NCLAT upholds CMA's categorization of rental claims as "under adjudication.

  Case-Laws - AT : NCLAT upheld CMA's categorization of claims related to delay in possession as "put under adjudication". CMA rightly asserted inability to verify rental claims unilaterally when agreement didn't provide for reimbursement of rent or commitment to pay rent. Claims premised on rental agreements fell under adjudication beyond CMA's limited jurisdiction. Unliquidated damages for delayed delivery and mental agony couldn't be admitted without agreement between parties. Appeal dismissed.
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Benami Property

• Partial payments don't prove benami property transactions.

  Case-Laws - AT : Impugned properties not held as benami as title not transferred to alleged benamidars due to partial payments made. No evidence of cash infusions by beneficial owner into accounts of alleged benamidars. AT unable to interfere with order of Adjudicating Authority holding transactions regarding impugned properties not benami under PBPTA.
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• Ownership of property upheld, Benami transactions allegations dismissed.

  Case-Laws - AT : AT held that M/s North Star Homes continue to remain owner and in possession of impugned property. Neither property was transferred to alleged Benamidar nor held by them. No evidence that cash infusions into Benamidar's accounts were made by Beneficial Owner. Impugned Order set aside as neither property is Benami nor transaction regarding it is Benami.
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IBC

• NCLAT Allows Unwinding IFIN Loans, Except for Respondents 8-12; Claims Restored in Attivo Economic Zone CIRP.

  Case-Laws - AT : The NCLAT allowed the approval of the New Board's decision to collapse/unwind transactions whereby IFIN provided loans to third parties, except for certain respondents (8-12). The NCLAT set aside the IRP's rejection of IFIN's claim in the CIRP of Attivo Economic Zone (Mumbai) Pvt. Ltd., restoring IFIN's status. The NCLAT held that collapsing agreements with respondents 8-12 required deeper consideration as SIFL claimed the amounts were given by SIFL, not third-party borrowers. The appropriate forum to examine these transactions is the pending NCLT proceedings.
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• NCLAT dismisses operational creditor's insolvency petition on multiple grounds.

  Case-Laws - AT : Debt claim below statutory threshold. Interest component excluded from operational debt absent express agreement. Claims within Section 10A period excluded. Pending commercial suit between parties bars insolvency application u/s 8. Section 9 petition not maintainable on multiple grounds. Appeal dismissed by NCLAT.
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Indian Laws

• Delay in filing land acquisition appeals beyond 120 days cannot be condoned.

  Case-Laws - HC : The HC held that it lacks power to condone delay in filing appeals beyond 120 days stipulated u/s 74(1) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013. Section 74(1) proviso expressly excludes applicability of Section 5 of Limitation Act, 1963 by conferring power to condone delay only up to 60 days beyond initial 60 days period. The applications seeking condonation of delay beyond 120 days were dismissed.
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• High Court upholds 20% deposit of fine for appeal u/s 148 Negotiable Instruments Act.

  Case-Laws - HC : HC upheld condition imposed by Sessions Judge requiring applicant to deposit 20% of fine amount u/s 148 of NI Act. Relying on SC's observations in Ashok Kumar v. State of Uttarakhand, HC held appellate court may impose deposit condition u/s 148, except where unjust or depriving accused's right to appeal. HC found no special circumstance warranting exception in applicant's case. Application dismissed.
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Service Tax

• Petitioner ineligible for SVLDRS 2019 benefits due to non-payment within stipulated period; subsequent recoveries treated as arrears under Finance Act.

  Case-Laws - HC : The HC held that since the petitioner failed to pay the determined amount under SVLDRS Form-3 within the stipulated period, the petitioner could not avail the benefit offered under the SVLDRS, 2019 scheme. The amounts recovered by the Department were not payments made within the scheme's period but subsequent recoveries of arrears u/s 87 of the Finance Act, 1994. As the petitioner became the firm's Managing Partner after the reconstituted partnership deed, the HC found no merit in challenging the attachment order and dismissed the petition.
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• Income from construction services can't be service taxed based only on director's statement.

  Case-Laws - AT : Respondent declared miscellaneous income of Rs. 6 crores to IT Department. Department proposed service tax demand and penalty u/s 78(1) based on director's statement that income was from construction services. CESTAT held demand unsustainable as statement alone inadmissible without corroborative evidence. Department failed to produce evidence that income was from taxable services. Demand based on assumptions and presumptions. Original authority rightly dropped demand for lack of evidence. Department's appeal dismissed by CESTAT.
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Central Excise

• Excise demand for clandestine removal set aside due to lack of evidence.

  Case-Laws - AT : The CESTAT set aside the demand and penalties imposed on the grounds of alleged clandestine removal, holding that the charge was not substantiated by sufficient evidence. It observed that mere alleged recording of higher royalty payment by the franchiser, without corroborative proof of actual higher production, procurement of raw materials, sale proceeds etc., cannot sustain the allegation of clandestine manufacture and removal. The statements recorded behind the appellants' back and documents seized from third parties were held inadmissible without allowing cross-examination. Lack of clinching evidence regarding clandestine operations rendered the entire demand unsustainable, and consequently, the penalties were also set aside.
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Case Laws:

• GST

• 2025 (1) TMI 838
  Jurisdiction of the Officers of the State GST Department to issue the aforesaid authorisation and show cause notice to the petitioner - proper officers for the purposes of the CGST Act - HELD THAT:- The provisions of Section 6 (1) of the CGST Act make it abundantly clear that the cross-empowerment of the Officers of the SGST/UTGST Department to function as proper officers under the CGST Act is through the legislative mandate under Section 6 (1) of the CGST Act. It is a mandate and empowerment that is presently unqualified but expressly made subject to such conditions as the Government shall, on the recommendation of the Council, by notification, specify. In other words, while the statutory mandate at present is unqualified, it will be qualified in the event the Government specifies conditions for the exercise of power under the statutory mandate, pursuant to the recommendations of the Council. It cannot be persuaded to read the statutory mandate as one that does not presently bring about a cross-empowerment but merely envisages such a situation as and when a notification is issued at some time in the future. Conclsuion - Section 6(1) of the CGST Act inherently provides cross-empowerment of State and Union Territory GST officers as proper officers under the CGST Act, without the need for a specific notification unless conditions are to be imposed.

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• 2025 (1) TMI 837
  Imposition of a penalty under Section 129 of the GST - failure to register an additional place of business - E-way bill and the invoices were generated only after the detention was made on 15.03.2022 at about 10.25 a.m. - HELD THAT:- The excuse of the petitioner that the additional place of business at Sothupakkam Village, Redhills, Chennai was not registered by the petitioner and that the same was only the procedural irregularities can be accepted as there is only technical and venial breach of the provisions. That apart, order of detention was made in Form GST MOV-06 dated 15.03.2022 at about 10.25 a.m and it was followed by a Notice issued under Section 129(3) of the respective enactments in Form GST MOV-07. The Eway bill which has been filed by the petitioner along with the typed set of papers indicates that it has been generated on the previous date i.e., on 14.03.2022 at about 6.28 p.m. There appears to be a procedural irregularities committed by the petitioner inasmuch as the transaction covered by the goods seized / detained vide Detention Order dated 15.03.2022 in Form GST MOV-06 was pertaining to the same goods covered by the aforesaid invoice dated 14.03.2022 and the E-way bill dated 14.03.2022 - Unless there was a variance between quantity in the invoice and the E-way bill and the actual seizure made, the question of imposing penalty under Section 129(3) of CGST Act, 2017 would be harsh under the given facts and circumstances of the case. Conclusion - Procedural irregularities without fraudulent intent do not warrant harsh penalties under Section 129 of the GST enactments. The impugned order is quashed due to the procedural nature of the irregularities and the absence of fraudulent intent. Petition allowed.

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• 2025 (1) TMI 833
  Maintainability of review petition(s) - delay of 305 days in filing the review petition(s) - HELD THAT:- The review petition(s) is/are dismissed both on the ground of delay as well as on merits.

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• 2025 (1) TMI 832
  Cancellation of the petitioner's registration - HELD THAT:- The petitioner was not obligated to visit the GST portal to receive the show cause notices that may have been issued to the petitioner for 2018-19 through e-mode, preceding the adjudication order dated 29.04.2024 passed in pursuance thereto. No useful purpose may be served in keeping the petition pending or calling counter affidavit at this stage or to relegate the present petitioner to the forum of alternative remedy. Impugned order set aside - Petition disposed off.

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• 2025 (1) TMI 831
  Refund of the GST amount paid - GST paid on an advance for a contract that was later rescinded due to non-performance by the supplier - HELD THAT:- Admittedly, the contract in question having been breached by the other party thereto, the Assessee has recovered the amount by encashing the bank guarantee. The amount remitted to the Exchequer by way of GST component in contemplation of discharge of contract by execution could not have been retained by the State when the contract failed. It is as simple as that. Levy of tax is on the transaction; if transaction fails what is paid in advance needs to be refunded. The learned Single Judge has structured the impugned judgment on this inarticulate premise, which cannot be faltered. The vehement submission of learned AAG that no refund can be granted as a matter of course, unless the requirement of Sec. 54 of Karnataka Goods and Service Tax Act, 2017, appears to be very attractive at the first blush. However, a deeper examination shows it otherwise. Sec. 54 (1) of the Central GST Act, 2017 is in pari material with the said provision of the State Act. The Apex Court in OSWAL CHEMICALS AND FERTILIZERS LIMITED vs. COMMISSIONER OF CENTRAL EXCISE, BOLPUR [ 2015 (4) TMI 352 - SUPREME COURT ] construed the term any person employed in Sec. 11B of the Central Excise Act, 1944 to include even the purchaser of goods and therefore purchasers too can seek refund of Central Excise Duty. The same analogy applies to the case of Respondent-Assessee. The Revenue could not have declined the refund on the ground that Credit Note was not issued by the other party to the contract ie., the vendor, upon whom essentially the duty to pay tax rested inasmuch as the question of issuing such a note would not arise since goods were never delivered and that there was a gross breach of contract because of which it was rescinded and the price paid in advance was retrieved by encashing the bank guarantee. Conclusion - The tax should not be retained by the state when the underlying transaction fails. The appellant shall refund or cause to be refunded the GST amount to the Respondent-Assessee within a period of eight weeks. Appeal dismissed.

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• Income Tax

• 2025 (1) TMI 836
  Assessment u/s 153A - unexplained income u/s 68 - incriminating material was found during the operations conducted u/s 132 or not?HELD THAT:- CIT(A) had decided the Assessee s appeal confined to the question whether Section 153A was applicable in the given facts CIT(A) had not decided the Assessee s challenge to the addition u/s 68. Thus, clearly the question whether the said addition had been rightly made by the AO did not arise for consideration of the learned ITAT notwithstanding that the ground to the aforesaid effect was raised by the Revenue. Thus, in effect, the Assessee s challenge to the addition u/s 68 had remained unaddressed by CIT(A) but had been affirmed by ITAT, without the same arising from the order passed by CIT(A). ITAT has clearly erred in entering into the said controversy without CIT(A) rendering any finding on merits in regard to the petitioner s appeal. The question of law as framed is decided in favor of the Assessee and against the Revenue. We consider it apposite to set aside the impugned order passed by ITAT to the limited extent that ITAT had determined the merits of the addition u/s 68 and restore the Assessee s appeal before CIT(A) on the grounds that were not decided by the CIT(A).

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• 2025 (1) TMI 830
  Validity of reopening of assessment against the ex-promoters - notice u/s 148 against petitioner company after the approval of the resolution plan for a period prior to closing - liability of previous management - As decided by HC [ 2024 (5) TMI 57 - BOMBAY HIGH COURT] section 148 r/w Section 147 of the Act only deals with a situation where any income chargeable to tax has escaped assessment for any assessment year. We are unable to fathom as to how the provisions of Section 148 of the Act can be applied for collection of evidences of third party, ex-promoters etc., and we say this because there are separate provisions under Section 133(6) of the Act in which, such evidences can be collected. HELD THAT:- In view of the observations made in paragraph nos. 3 and 4 of the order impugned before us, we are not inclined to interfere. Special Leave Petition is, accordingly, dismissed.

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• 2025 (1) TMI 829
  Rejection of Application for waiver of interest u/s 220 (2A) - HELD THAT:- In this case, the Petitioner has failed to make out any case with the non-payment of the tax demanded in time was under circumstances beyond the control of the Petitioner. In this case, the Chief Commissioner has exercised the powers reasonably, and the feeble contention about violating natural justice lacks force. Chief Commissioner has applied his mind to the relevant circumstances, and his approach cannot be considered unreasonable. The impugned order is reasoned, and the reasons cannot be considered irrelevant. Relevant material on record was considered. Even the factual findings are supported by the material on records, and there is no perversity. The decision in Chander Prakash Jain [ 2015 (5) TMI 687 - ALLAHABAD HIGH COURT] is based on peculiar facts that are not comparable to those in the present case. Besides, that case did not involve the exercise of powers u/s 220 (2A) of the IT Act. This Court does not exercise appellate jurisdiction in such matters. Considering the limited scope of judicial review, no case is made to interfere with the impugned order. All three preconditions must coexist before a waiver order can be made u/s 220 (2A) of the IT Act. No merit in this Petition.

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• 2025 (1) TMI 828
  Writ jurisdiction of the High Court to challenge an intimation u/s 143(1) - AO's failure to adjudicate the rectification application under Section 154, due to the pending writ petition - HELD THAT:- If the officer was of the view that our ad-interim order amounts to restraining himself from adjudicating this issue in regular assessment proceedings, then, he should have approached this Court for clarification. We are clear that at no stage we had restrained the Respondents from adjudicating this issue in regular assessment proceedings. Petitioner had made an application on 31 July 2023 for rectification of the intimation. The said application of the Petitioner was never decided by the AO on the ground that issue of Section 143 (1) adjustment is pending before this Court. We once again clarify that we had not restrained the Respondents from passing any order to decide the rectification application filed by the Petitioner on 31 July 2023. We fail to understand that in the absence of any restraint order by this Court the stand of the Respondents not to adjudicate the rectification application is misconceived. The officer ought to have adjudicated this rectification application in accordance with law. The intimation under challenge is an appealable u/s 246A (1) (a) of the IT Act - In Section 246A there is no provision of mandatory pre-deposit for admitting and entertaining the appeal, and therefore, the contention of Mr. Sheth that the intimation raises a huge demand of Rs.6600 crores, and therefore, the remedy of appeal is not efficacious remedy, is rejected. Certainly the Petitioner has the remedy of making an application for stay of the demand and any order passed thereon, if the Petitioner is aggrieved, can be challenged in accordance with law. Therefore, although huge demand is raised, but in the absence of any pre-deposit for admitting and entertaining the appeal, this Court cannot interfere with the impugned intimation in writ proceedings. Order: - Petitioner is at liberty to challenge the impugned intimation by filing an appeal within a period of four weeks from the date of uploading of the present order. Respondent No. 2 is directed to decide the rectification application dated 31 July 2023 within a period of two weeks from the date of uploading the present order.

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• 2025 (1) TMI 827
  Reopening of assessment - benefit of the new regime - scope of provisions of TOLA applicable for reopening an assessment pertaining to AY 2015-16 - validity of reassessment notices issued after the promulgation of Finance Act, 2021 - pecuniary quantification of income which had allegedly escaped assessment - whether grant of approval u/s 151 would have to be in consonance with the extended time limits which came to be introduced by TOLA - HELD THAT:- As is manifest by virtue of GKN Driveshafts [ 2002 (11) TMI 7 - SUPREME COURT] the respondents were placed under an obligation to communicate the reasons for formation of opinion of income having allegedly escaped assessment to the assessee and providing him an opportunity to object to the commencement of a reassessment action on jurisdictional grounds. It was this procedural safeguard, as formulated in GKN Driveshafts, which finds resonance in clauses (b) and (d) of Section 148A of the Act. The respondents had substantially complied with the principles underlying Section 148A (b) and (d) by providing an opportunity to the petitioner to question the assumption of jurisdiction under Section 148. We are thus of the firm opinion that, notwithstanding a formal communication having not been addressed to the petitioner of the 09 April 2021 notice being liable to be treated as one under Section 148A (b), the impugned notice and the consequential proceedings are not liable to be faulted on this score. Validity of approval for reassessment granted by the Joint Commissioner was valid u/s 151 - The reasons to believe which were provided to the writ petitioner had pegged the escaped assessment at INR 46,17,000/- and thus ex facie falling below the threshold prescribed by Section 149 (1) (b). The Supreme Court in Rajeev Bansal [ 2024 (10) TMI 264 - SUPREME COURT (LB)] has categorically held that an action of reassessment commenced post 01 April 2021 would have to be compliant with the pecuniary threshold which now applies. Tested on that basis it becomes apparent that the impugned action would not sustain on this score. Supreme Court in Rajeev Bansal had merely alluded to the time frames within which approval could be sought and obtained and that being regulated by the extended timelines which TOLA had introduced. However, Rajeev Bansal cannot possibly be construed or read as affirming the authority of a Joint Commissioner to accord approval or the said authority being viewed as the competent authority for the purposes of grant of approval post 01 April 2021. We thus come to conclude that the reassessment action impugned before us in this petition cannot be sustained basis the pecuniary threshold as comprised in Section 149 (1) (b) as well as on the action having not been approved by the competent authority under Section 151. We allow the instant writ petition and quash the impugned notice digitally signed referrable to Section 148 and the order thereon. Decided in favour of assessee.

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• 2025 (1) TMI 826
  Reopening of assessment u/s 147 - notice beyond a period of four years - reasons to believe - HELD THAT:- On a perusal of the reasons recorded, there is no allegation as to what are the material facts which the petitioner failed to disclose at the time of his assessment. Mere reproducing the wordings of the proviso does not satisfy the jurisdictional condition which the AO is required to satisfy prior to reopening the case. Having said so, the reasons themselves record that the same is based on the case records of the petitioner. Therefore, if based on these case records which case records are filed by the petitioner- assessee during the course of the assessment proceedings and are forming part of the assessment records, if a reopening is sought to be done after a period of four years then that would be wholly without jurisdiction in the absence of satisfaction of the condition prescribed in first proviso to Section 147 of the Act. The reasons recorded clearly proves that condition as per first proviso are not satisfied. In the reasons recorded there is no mention as to what are the material facts which the petitioner-assessee ought to have disclosed and which came to the notice of the AO post the assessment order from any source outside the assessment records. Co-ordinate Bench of this Court in the case of Hindustan Lever Ltd. [ 2004 (2) TMI 41 - BOMBAY HIGH COURT] have observed that the reasons should disclose as to which fact or material was not disclosed by the assessee fully which was necessary for assessment so as to establish the vital link between the reasons and evidence. Mere mentioning that there was a failure to disclose fully and truly material facts does not confer jurisdiction on the Assessing Officer to reopen the case after the expiry of four years. The original assessment of the petitioner was selected for limited scrutiny which was converted into complete scrutiny to examine the transactions of capital gains. The petitioner in the course of the assessment proceedings gave the details of long term capital gain and short term capital loss including the date of acquisition and date of transfer. The petitioner also gave details of loss on transfer of mutual funds. It is only after examining all the details relating to capital gain and capital loss that an assessment order came to be passed u/s 143 of the Act. In our view, based on these very details, the present proceedings have been initiated which is impermissible since it does not satisfy the pre-condition prescribed under the first proviso to Section 147 of the Act, it would amount to review of the assessment order which is not permissible. Decided in favour of assessee.

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• 2025 (1) TMI 825
  Validity of assessment order passed u/s 143 (3) r.w.s. 144B - scope of an appeal u/s 260A - scope of alternate remedy - HELD THAT:- In Greatship (India) Limited [ 2022 (9) TMI 896 - SUPREME COURT] the Hon ble Supreme Court did not approve the decision of the High Court to entertain the Writ Petition under Article 226 of the Constitution challenging the assessment order given the statutory alternate remedies available under the Maharashtra Value Added Tax 2002 and the Central Sales Tax Act, 1956. The Court held that the assessee showed no valid reasons to bypass the statutory remedy of appeal and that the Supreme Court has consistently taken the view that when an alternate remedy is available, judicial prudence demands that the courts refrain from exercising its jurisdiction under constitutional provisions. For all the above reasons, we decline to entertain this Petition. However, we leave it open to the Petitioner to avail the alternate remedy of appeal by clarifying that we have not examined the rival contentions on merits. If the Petitioner does institute an appeal, the Appellate Authority must note that the Petition was filed on 10 April 2024 and has been pending in this Court to date.

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• 2025 (1) TMI 824
  Rejection of stay of demand - petitioner was directed to pay 20% of the demand in six installments - whether the petitioner has made a prima facie case for a full stay of demand of Rs. 5.86 crore? - HELD THAT:- The proceedings were initiated on account of search action at the premises of the petitioner. AO has carried out detailed investigation and come to a conclusion that the purchases are nongenuine. Statements of various persons were also recorded for coming to the said conclusion. In our view, based on these findings in the assessment order, it cannot be said that the additions made on account of non-genuine purchases is totally unwarranted at least for the purpose of concluding not dispensing the payment of 20% of the demand. The petitioner has not presented any documents showing its financial incapacity to pay 20% of demand. The case of the petitioner on account of high pitch assessment cannot be accepted since in the present case, the additions have been made based on incriminating documents during the course of search action and investigation carried out by the AO in the assessment proceedings. The petitioner was given sufficient opportunities to rebut the same, and it is only after detailed investigation that the additions have been made. This is not a case where the gross profit disclosed by the petitioner is sought to be rejected, but this is a case where the petitioner has failed to prove the purchases and, therefore, the contention of the petitioner that only gross profit additions could have been made and, therefore, the rejection of entire stay is unjustified is to be rejected. The issue of whether the purchases are genuine or non-genuine is a question of fact to be determined on the facts of each particular case and, therefore, the bald statement of the petitioner s counsel that various decisions of the Coordinate Bench cover the issue cannot be accepted since we have not been shown any judgment wherein on these very facts, the additions on account of non-genuine purchases have been allowed as deduction. Petitioner is only attempting to delay the recovery proceedings of 20% of the demand. In our view, no case is made out for a complete stay of demand. Since the petitioner has not made out any prima facie case nor shown its financial incapacity to pay 20% of the demand, we, in our extraordinary jurisdiction, refrain from interfering with the orders challenged in the present petition and dismiss this petition with no order as to costs.

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• 2025 (1) TMI 823
  Writ of Mandamus directing the respondents to furnish information regarding the action taken on letters addressed by the petitioner or any suo moto action initiated by the respondents - Regarding prayer clause (a), he refers to the report of the Serious Fraud Investigation Office (SFIO) and Committee constituted by this Court - HELD THAT:- We believe this petition is entirely misconceived and warrants dismissal by the imposition of exemplary costs. Prayer clause (a) is blissfully vague. Despite several requests, we were not shown the precise nature of the information sought by the petitioner and the information denied to the petitioner. Considerable Judicial time was occupied in this exercise. The petitioner has not bothered to disclose details of the pending suit in which the petitioner is impleaded as a defendant. There are sufficient provisions in the Civil Procedure Code for obtaining information like interrogatories etc., assuming that such information is relevant. Petitioner has not explained why the petitioner did not seek such information under the Right to Information Act, 2005. An averment is made that the petitioner has no other alternate and efficacious remedy. This averment is made with utmost casualness and without assuming any serious responsibility. Respondents filed their affidavit on 19 April 2021. In 2025, we are informed that the petitioner is satisfied with the respondent's action in the context of prayer clause (b), which we thought was the main relief in this petition. Still, this petition was not moved and has been pending for all these years. We dismiss this petition with costs of Rupees One Lakh payable to the Government KEM Hospital.

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• 2025 (1) TMI 822
  MAT/Section 115JB applicability on the assessee engaged in the business of electricity generation and distribution - additions made on account of Book Profit u/s 115JB - HELD THAT:- The accounts, laid down in the annual general meeting of an electricity company, would have been prepared in accordance with the special statutes, such as the Electricity Act, 2003 and the Electricity (Supply) Act, 1948. However, as noted above, sub-section (2) of Section 115JB of the Act clearly mandates that the accounts prepared must comply with Schedule VI of the Companies Act, 1956, and use the same accounting policies, standards, etc. as those adopted for preparing accounts for the annual general meeting under Section 210 of the Companies Act, 1956; whereas the electricity companies are not required to prepare their accounts in terms of Schedule VI of the Companies Act, 1956. Therefore, in view of the aforesaid, it would prima facie appear that Section 115JB of the Act, as it stood during AY 2006-07, would become inapplicable to an electricity company. Scope of amended Section 115JB - The new amendment allowed such companies to compute their book profits under Section 115JB of the Act using accounts prepared as per their regulatory Acts, thereby aligning the provisions of the Act with the Companies Act, 1956, and ensuring consistency in tax computation for these special categories of companies. However, the Memorandum also clarified that these amendments were prospective in nature and applicable from AY 2013-14 onwards. Thus, Section 115JB did not apply to the assessee for AY 2006-07.

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• 2025 (1) TMI 821
  Breach of principles of natural justice - no adequate time was granted to the petitioner to submit a reply - HELD THAT:- The petitioner has not bothered to disclose any details of its Chartered Accountant s request dated 16 March 2024 and the reasons set out therein in this petition. The contention about the difficulty of taking screenshots, etc., does not inspire confidence. We are satisfied that this relevant adjournment request was not disclosed because the petitioner realised that this disclosure would be inconvenient to the case of an alleged breach of principles of natural justice, which was being projected before us. Such non-disclosure, or rather suppression, cannot be appreciated. Thus, the petitioner made a patently incorrect statement about the availability of an alternate remedy and was not very candid with the Court. Besides, this is not a case of any patent breach of principles of natural justice. The petitioner does not allege the absence of any opportunity; rather, the petitioner s grievance concerns inadequate opportunity. The issue of inadequate opportunity could always have been raised in an appeal against the assessment order. Even now, the petitioner is at liberty to raise such contention in an appeal, should the petitioner choose to institute an appeal. However, we are satisfied that no case is made out to depart from the usual practice of requiring the petitioner to exhaust the alternate and statutory remedies available in the facts of this case. We decline to entertain this petition, leaving it to the petitioner to challenge the assessment order in accordance with the law since we have not examined its merits.

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• 2025 (1) TMI 820
  Reopening of assessment against non non-existent company - Validity of notices issued under the unamended Section 148 post-01.04.2021 - Scope of new provision section 148A - notice was issued in the name of company which prior to the issuance of the notice stood amalgamated with the petitioner company - HELD THAT:- In the present case, a notice dated 29.07.2022 was issued u/s 148 of the Act after following the procedure as set out in Section 148A of the Act and in terms of the decisions of in Union of India Ors. v. Ashish Agarwal [ 2022 (5) TMI 240 - SUPREME COURT] The said notice is in the name of the petitioner and, therefore, cannot be faulted on account of the impugned notice having been issued in the name of a non-existent company. The reassessment proceedings in respect of AY 2014-15 are now being continued pursuant to the notice dated 29.07.2022 issued u/s 148 and not the impugned notice, which is to be construed as a notice u/s148A (b) of the Act. The contention that the proceedings are vitiated on account of the fact that the impugned notice was issued in the name of a non-existent company is unmerited. Petition dismissed.

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• 2025 (1) TMI 819
  Validity of reopening of assessment beyond period of limitation - initial notice was preceded by other notice issued under Section 148A (b) - notice issued u/s 148A(b) is a continuation of the first notice or a standalone notice? - HELD THAT:- The information on which the first notice (notice dated 31.03.2024) is based, is not the information on which the second notice dated 18.04.2024 is premised. The information, which according to the AO, was suggestive of the petitioner s income escaping assessment for the AY 2020-21, as set out in the second notice, is completely different from the information as set out in the first notice. The transactions in respect of which it is alleged that the petitioner s income may have escaped assessment as set out in the second notice, is not the transaction which had led the AO to issue the first notice. There is considerable merit in the petitioner s contention that the second notice issued under Section 148A(b) of the Act must be viewed as a standalone notice and not in continuation of the first notice dated 31.03.2024. The short note filed on behalf of the Revenue also states that the notice dated 18.04.2024 (the second notice) issued under Section 148A(b) of the Act pertains to the commission income in connection with the search conducted on the JM Jain Group on 28.05.2022. It is relevant to note that the first notice (notice dated 31.03.2024) referred to lose papers and documents found during the course of search action in respect of SBP Group . Plainly, the information as mentioned in the second notice cannot be said to be in continuation of the information as referred to in the first notice. There is no dispute that if the second notice (notice dated 18.04.2024) issued under Section 148A (b) of the Act is considered as a standalone notice, the same would be beyond the period as stipulated under Section 149 (1) (a) of the Act as was in force at the material time. This is because the amount of income, which is alleged to have escaped income, is less than Rs. 50,00,000/- and a period of more than three years have elapsed from the end of the relevant assessment year (AY 20-21). The impugned order passed under Section 148A (d) of the Act as well as the notice issued u/s 148A(b) of the Act, is set aside. Decided in favour of assessee.

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• 2025 (1) TMI 818
  Reassessment notice issued against the dead-assessee - HELD THAT:- It is not in dispute that the impugned notice has been issued upon the late husband of the petitioner and therefore, the same would be without jurisdiction as it is now also evident from the additional documents placed on record including the Screenshot from the Income Tax Portal of the compilation wherein, the Email address had been updated as per the Adhar Card of the late husband of the petitioner. Thus, the averments made by the respondent-Assessing Officer justifying the action of issuing the notice on the Email address available on the record cannot be accepted. Thus, the petition deserves to be allowed by holding that the impugned notice which was issued against the dead-assessee cannot be sustained. Decided in favour of assessee.

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• 2025 (1) TMI 817
  Reopening of assessment u/s 147 - Disallowance of deduction claimed u/s 80P (2) (d) - HELD THAT:- When the issue which is sought to be raised for disallowance of the deduction claimed by the assessee u/s 80P (2) (d) of the Act which is on the interest income earned by the petitioner from the fixed deposit kept with the Cooperative Bank is held in favour of the petitioner of this Court in case of Ashwinkumar Arban Co-operative Society Ltd. [ 2024 (11) TMI 971 - GUJARAT HIGH COURT ] it cannot be said that this is a fit case to reopen the assessment in the facts of the case. Petition succeeds and is accordingly allowed. Impugned order passed u/s 148A (d) as well as notice are hereby quashed and set aside.

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• 2025 (1) TMI 816
  Delayed payment of employees contribution to Provident Fund (PF) and Employees State Insurance (ESI) - HELD THAT:- From relevant extracts of the decision of Checkmate Services (P) Ltd. [ 2022 (10) TMI 617 - SUPREME COURT] it is evident that the assessee has to make payment of the contribution to PF and ESI before the statutory dates in order to claim the amount as deduction. Admittedly, the assessee has not paid the aforesaid amount on or before the statutory dates. The findings of fact has been recorded by the AO, CIT(A) as well as by the Tribunal. The aforesaid finding of fact cannot, by any stretch of imagination, be said to be perverse. It is not the case of the assessee that the aforesaid finding of fact is perverse. It is well settled in law that this Court, in exercise of powers u/s 260A of the Act, cannot interfere with the finding of fact until and unless the same is demonstrated to be perverse. (See Syeda Rahimunnisa vs. Malan Bi by LRs [ 2016 (10) TMI 1233 - SUPREME COURT] and Softbrands India Private Limited [ 2018 (6) TMI 1327 - KARNATAKA HIGH COURT] ) - No substantial question of law arises.

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• 2025 (1) TMI 815
  Reopening of assessment - loss on account of F O transactions - genuineness of such transactions remained unproved - HELD THAT:- The specific issue of losses on account of F O trade was raised by the department, it cannot be held that the department was justified in reopening the assessment for Assessment Year 2013-14, which, we may add, has been done mechanically without application of mind, in the absence of any tangible material. Reasons recorded that the no verification of the material on record is made by the respondent and there is no independent opinion that any income has escaped assessment due to any failure on the part of the assessee in not disclosing fully and truly all material facts necessary for assessment. The initiation of reopening proceedings are on the borrowed satisfaction as no independent opinion is formed and on bare perusal of the reasons recorded, it emerges that the Assessing Officer, considering the information received from the insight portal, has issued impugned notice forming reason to believe that the income has escaped the assessment on the presumption that the petitioner has been involved in creating the non-genuine profit which is already offered to tax in the return of income which is accepted in the regular course of assessment by passing the order under section 143 (3) of the Act. There is no basis to form reasonable belief for escapement of income except the information made available on the insight portal - As on the basis of the information received from another agency on insight portal or from the SEBI report, there cannot be any reassessment proceedings unless the respondent, after considering such information/material received from other sources, consider the same with the material on record in the case of the petitioner assessee and thereafter, is required to form independent opinion that income has escaped assessment. Without forming such opinion solely and mechanically relying upon the information received from the other sources, the respondent-Assessing Officer could not have assumed the jurisdiction to reopen the assessment based on such information. This view is fortified by the decision of this Court in case of Harikishan Sunderlal Virmani [ 2016 (12) TMI 1558 - GUJARAT HIGH COURT] Assessing Officer could not have assumed the jurisdiction merely and solely relying upon the information made available on the insight portal without forming any independent opinion on the basis of the material on record vis-a-vis the petitioner is concerned. Petitioner had disclosed in its return for the Assessment Year 2013-14 the particulars of the loss under the head of future and options which was subsequently scrutinized and accepted by the Department. Therefore, the notice for re-opening the assessment on the exact entry under the head of future and options is based on change of opinion. Decided in favour of assessee.

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• 2025 (1) TMI 814
  Penalty u/s 270A - quantification of the penalty - Allocation of allocation of 10% of administrative and other expenses to the 80-IA unit - HELD THAT:- We observe that while dismissing the appeal of the assessee against the Section 270A order, CIT(A) did not take into consideration the facts of the case submitted by the assessee (in Form No. 35) in which it was pointed out that CIT(A) had granted substantial relief to the assessee in quantum proceedings. It is further observed that CIT(A) has also not taken into consideration the grounds of appeal of the assessee in which it was submitted that since the entire additions were on account of ad-hoc apportionment of expenses, penalty was not liable to be levied in the instant facts under Section 270A of the Act. On going through the contents of the order passed by the Ld. CIT(A), it is observed that Ld. CIT(A) has not discussed either the facts of the case submitted by the assessee and nor discussed the grounds of appeal raised by the assessee. Thus matter is restored to the file of Ld. CIT(A) for de-novo consideration and to pass appropriate orders - Appeal of the assessee is allowed for statistical purposes.

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• 2025 (1) TMI 813
  Penalty u/s. 271B - assessee failed to get its accounts audited and failed to furnish the audit report u/s. 44AB - Assessee submitted that the first appeal filed by the assessee against quantum assessment is pending before CIT(A), and the penalty proceedings u/s 271B be kept in abeyance HELD THAT:- CIT(Appeals) first adjudicate the appeal filed by the assessee against quantum assessment, and to give its conclusive finding as to the business turnover, gross receipts of sales achieved by the assessee, and whether or not the assessee falls within four corners and ambit of provisions of Section 44AB, so as to determine/adjudicated the imposition of penalty u/s 271B. It is only when there is a conclusive finding of the CIT(Appeals) on the issue of business turnover or gross receipts or sales achieved by the assessee (which is disputed by the assessee before ld. CIT(Appeals)), the appeal against penalty order u/s. 271B be adjudicated accordingly by ld. CIT(A), keeping in view the threshold limit u/s. 44AB of the Act. Thus, in the interest of justice and fairness to both the parties, the appellate order passed by ld. CIT(Appeals) is set aside and the matter is restored back to the file of ld. CIT(Appeals) to adjudicate afresh. Appeal filed by the assessee is allowed for statistical purposes.

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• 2025 (1) TMI 812
  TP Adjustment - Comparable selection - inclusion of Magma Advisory Services Ltd. - HELD THAT:- We direct the AO/TPO to include Magma Advisory Services Ltd. in the list of comparables. Depreciation at the rate of 60% on intangible assets i.e. computer software - DRP directs the AO to verify the details of computer software provided by the assessee and treat the same as intangible asset if it involves kind of patent etc. and determined the rate of depreciation as per the Act - HELD THAT:- AO is directed to comply with the directions of the DRP and decide the issue, accordingly. - Ground allowed for statistical purpose. Disallowance made u/s. 40(a)(ia) - non deduction of taxes on payment for International Travel Expense - HELD THAT:-As assessee has submitted that out disallowance so made, taxes on international travel expense was duly deducted and deposited. The AO is directed to verify this contention of the assessee and take necessary action as per law. AO is directed to decide this issue in accordance with the aforesaid directions. Ergo, ground allowed for statistical purpose.

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• 2025 (1) TMI 811
  Addition being reimbursement of expenses incurred during the official tour for business purpose - whether reimbursed expenses as alleged perquisites in the hands of the Appellant? - HELD THAT:- Assessee was the founder and Managing Director of company as engaged in the business of export of spices, pickles etc. During the year under consideration approximately 98% of the Revenue of the company came from export of it s products. Assessee, being the Managing Director was required to travel to various countries and as per company policy expenses incurred for official purposes were reimbursed by the company directly to the credit card companies. As the company had a substantial turnover of Rs. 159 cores largely from export of it s products, keeping into consideration the confirmation given by M/s. ADF Foods that these reimbursements made to the assessee were for his official visits, keeping into consideration the fact that certain expenses which were found to be of a personal nature were not been reimbursed to the assessee by M/s. ADF Foods Ltd. and also in light of the fact that out of a turnover of Rs. 159 crores, only Rs. 4 crores were incurred towards travelling expenses, we are of the considered view that in light of these facts the addition made by the AO is liable to be deleted. - Decided in favour of assessee.

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• 2025 (1) TMI 810
  Revision u/s 263 - stamp duty paid was on higher side due to technical issues with stamp authorities - addition made as income from other sources u/s 56(2)(vii)(b) being 1/3 share of the assessee on the ground of discrepancy and stamp duty in as much as there is no discrepancy and the addition made is erroneous without appreciating the facts of the assessee. HELD THAT:- We find that the assessee vide letters had requested to refer the valuations of property to DVO as per the provisions of sec-50C of the Act. AO ought to have appreciated when the assessee objects to said valuation, then the AO is bound to refer the valuation to DVO in accordance with provisions of Sec 55A of the Income-tax Act. No evasive approach can be adopted for applying deeming provisions without considering the objections of referring the matter to DVO. The Coordinate Benches of the Tribunal in the case of Amar Shiv Construction Pvt Ltd. [ 2017 (12) TMI 1889 - ITAT AHMEDABAD] and Jayshree Kothari [ 2018 (10) TMI 1593 - ITAT HYDERABAD] held that such action on the part of the Assessing Officer cannot be sustained. Appeal of the assessee is allowed.

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• 2025 (1) TMI 809
  Validity of reassessment proceedings against struck-off company - Company s status has been shown as struck-off and listed on Stock Exchange as unlisted company - HELD THAT:- Company status currently is that of strike off company as submitted that by the AR which is prior to the issuance of the notice u/s 148 of the Income Tax Act, 1961 dated 30.03.2017. The strike off company has not been revived by the Revenue till date thus it remains a dead entity for more than 20 years. A company can get revived for a period of 20 years from the date of strike-off. The appeal or application can be filed by the registrar, any person aggrieved by order of the Registrar or by Company, or by member or creditor or workman. But in the present case revenue has not brought on record any steps for revival of the assessee company. Therefore, notice issued in the name of dead entity will be null and void. Thus, the entire assessment proceedings are void-ab-initio and bad in law. Appeal of the assessee is allowed.

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• 2025 (1) TMI 808
  Reopening of assessment u/s 147 - reasons to believe - Case of the assessee was reopened after expiry of four years, but before six years from the end of the assessment year - unexplained investment - Whether no addition was made on the issue that formed the basis for reopening the assessment? HELD THAT:- No Additions has been made in reassessment proceedings by the AO with respect to the alleged sources of investment made by the assessee in shares, as was claimed by the Revenue in the reasons recorded for reopening of the concluded assessment by invoking provision of Section 147 which formed the belief for reopening of the concluded assessment. The assessee s contention that no investment was made in the share purchase, and rather transactions in F O in shares were carried out, and contracts were squared/settled without any investment/purchase of shares. Assessee has raised specific ground No. 2 before ITAT wherein the assessee has challenged on legal ground the sustainability of re-assessment order u/s. 147 when no addition has been made on the issue with respect to which the case of the assessee was reopened at the time of initiation of reassessment proceedings u/s 147. Once no addition has been made with respect to the reasons recorded for reopening of the concluded assessment which formed the belief of the AO that income has escaped assessment, re-assessment order cannot be upheld/sustained if the additions are made on the other issues while no additions have been made on the issue on the basis of which the concluded assessment were reopened u/s 147 and which formed the belief of the Revenue that income has escaped assessment. See Jet Airways (I) Ltd [ 2010 (4) TMI 431 - BOMBAY HIGH COURT] , Sunlight Tour Travels Pvt Ltd. [ 2024 (11) TMI 1384 - DELHI HIGH COURT] No additions have been made on the grounds/issues on the basis of which assessment was reopened u/s. 147 and which formed the belief that the income has escaped assessment, then AO cannot make addition on other grounds/issues. Appeal filed by the assessee is allowed.

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• 2025 (1) TMI 807
  Deduction u/s 80IA - development of infrastructure facilities v/s mere execution of works contracts - AO disallowed the claim of the assessee by holding that Hence it is crystal clear that the assessee company has not carried out any work of development of new infrastructure facility in these cases and that Simply relying of an existing road would not be classified as a new infrastructure facility for the purpose of section 80IA(4)(i)' - HELD THAT:- Deduction u/s 80-IA is declined on the ground that the assessee had merely entered into an agreement with the Govt. and/or the assessee had received payments from Government, then in that eventuality an assessee who is only a developer will never be entitled to deduction u/s 80-IA. Therefore in our view, merely because the assessee was paid by the Government for development work, it cannot be denied deduction u/s 80- IA(4) of the Act. Similarly, an assessee cannot be declined the deduction on the ground that the assessee has not himself conceived the idea of infrastructure but has merely entered into a contract with the Govt.; entering into a contract with the Govt. is a sine qua non for claiming the deduction u/s. 80-IA(4) in this regard we rely upon the decision in the Adhunik Infrastructure [ 2018 (6) TMI 89 - ITAT KOLKATA] and the same view was also adopted by the Coordinate Bench of the Tribunal in the case of Bhinmal Contractors Property Land Developers P. Ltd. [ 2018 (5) TMI 244 - ITAT MUMBAI] even the recent decision of Montecarlo Construction Ltd. [ 2024 (1) TMI 383 - GUJARAT HIGH COURT] also supports the case of the assessee Thus we are of the view that the facts, nature of contracts, nature of works in the present years are same identical to the facts before the Hon'ble ITSC. And the eligibility of the assessee to claim deduction u/s. 80IA of the Act is squarely covered in favour of the assessee, by the order of the Hon'ble ITSC in the assessee's own case. Department has not brought anything on record to disturb the order of the Settlement Commission for the prior years and the order of the CIT(A) for A.Y 2018-19 both allowing the claim of the assessee for claiming deduction under section 80IA - Decided in favour of assessee.

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• 2025 (1) TMI 806
  Accrual of income in India or not - Permanent Establishment ('PE') in India - taxability of offshore supply of equipment under the Act and taxability of offshore supply of equipment under the India-Singapore Double Taxation Avoidance Agreement [DTAA] - assessee is a Singapore-incorporated entity established an Indian branch in the year 2002 for security equipment installation and maintenance - HELD THAT:- We find that identical issues arose in the AY 2019-20 in the assessee own case which was decided in favour of the assessee [ 2023 (2) TMI 1013 - ITAT DELHI ] , thus there is no justification in attributing the profit on off shore sale of equipment in the hands of the assessee. There are no distinguishing facts or material placed before us to take a contrary view. Receipt from Glidepath, New Zealand - AO has made the addition on account of absence of main documents and contract for the exact nature of work awarded to the assessee and the fact that the assessee engages in artificial splitting of contracts - HELD THAT:- AO has not disputed the fact that the compensation paid to SDVS was provided on a cost-plus arm's length markup. The issue of artificial splitting of contract has been dealt elsewhere in the order where the ITAT has given a finding that the work orders, splitting the scope of work between the assessee and its subsidiary in India, have been dully approved/agreed upon by the clients of the assessee and therefore we find the AO s allegation of splitting the contract has no legs to stand. Assessee argument that the maintenance receipts from Glidepath cannot be taxed in the hands of the assessee as the SDVS has been remunerated on a cost-plus basis and that where there is an international transaction under which a non-resident compensates another enterprise at arm's length price taking into account all the risk-taking functions of the enterprise, nothing further would be left to be attributed to the enterprise in India - SDVS was adequately remunerated on which it has already paid its due tax in India and there is no reason for further attribution. The assessee has correctly placed reliance on the decision of Morgan Stanley Co. [ 2007 (7) TMI 201 - SUPREME COURT ] Thus, receipt from Glidepath cannot be subjected to tax in the hands of the Assessee and we direct the AO to delete the addition. The ground no. 5 and its sub ground are allowed. Receipts from KITCOL, TTD and maintenance receipts from CIAL - assessee claims that the same has already been offered to tax in other AYs and taxing the same will amount to double-taxation - HELD THAT:- We find that the AO added these amount in absence of any proof. In the interest of justice, we deem it fit to restore the issue to the file of the AO to examine and decide the issue as per law. The assessee is also directed to furnish evidence to reconcile the receipts as being offered for tax in earlier years.

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• 2025 (1) TMI 805
  Validity of reopening of assessment u/s 147 - based on the information that assessee has made deposit during the current assessment year - Since there was no response from the assessee the AO completed the assessment u/s 144 - Addition made u/s 69A by adopting peak credit method - assessee submitted that the assessee has made cash deposits which is nothing but cash withdrawal made by the assessee during the year. HELD THAT:- As assessee has already demonstrated that assessee has withdrawn Rs. 20 lakhs in the month of October and the same cash withdrawals were with the assessee to make the deposits from 28.10.2010 to 15.03.2011. Therefore, the assessee has established the source of cash with him. Accordingly, we are inclined to allow the grounds raised by the assessee.

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• 2025 (1) TMI 804
  Addition u/s 68 - share capital money received treating the same as unexplained - HELD THAT:- Addition made on the basis of identity and creditworthiness of the investor company by the AO and from the record, we observed that the assessee has proved the existence of the company as well as bringing on record reasonable capacity in their hands to make the investment in the assessee s company and further the assessee has received the abovesaid investment through bank and utilised the same in its business as capital receipt. Therefore, the addition made by the AO is accordingly deleted. Appeal filed by the assessee is allowed.

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• 2025 (1) TMI 803
  Assessment passed u/s 143(3) against company dissolved - HELD THAT:- As noted that the resolution plan did not make any provision towards any statutory dues payable by the assessee. The assessee s counsel before the Hon ble High Court had stated that the revenue herein had not lodged its claim towards statutory dues before the Resolution Professional (RP). The Hon ble High Court [ 2023 (9) TMI 1163 - DELHI HIGH COURT] in noticed that the Corporate Insolvency Resolution Process (CIRP) in case of the assessee commenced on 19.03.2017. The Hon ble High Court noted that out of the total amount available for distribution, no amounts were ear marked for payment of statutory dues by NCLT in its order dated 4.2.2020 in view of the fact that the revenue had not lodged any claims before the RP. Though this High Court order was passed for the Asst Year 2008-09, still the fact that the revenue had not lodged any claim before the RP holds good for the year under consideration also. We deem it fit and appropriate to dismiss the appeal of the revenue as no purpose would be served by keeping this appeal pending before this tribunal and even if the revenue succeeds before this tribunal, still it could not recover any dues from the assessee company in view of the fact, that it had failed to implead itself by lodging its claim before the RP and no monies were allocated for distribution towards any statutory dues in the order passed by the NCLT dated 4.2.2020. Accordingly, the grounds raised by the revenue are dismissed. Appeal of the revenue is dismissed.

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• Benami Property

• 2025 (1) TMI 802
  Benami Transactions - beneficial owner of subject property Whether alleged Benamidars and the Beneficial Owner constitute Benami Transactions under the Prohibition of Benami Property Transactions Act, 1988 (PBPTA)? - HELD THAT:- It is an admitted fact that only partial payments have been made by the alleged Benamidars to the interested party M/s ICON Constructions. These partial payments were made on signing of Agreement of Sale. Adjudicating Authority has not held the impugned property as Benami as the title therein was yet to be transferred to the alleged Benamidars in view of sale having not been completed due to partial payments made by the alleged Benamidars. There is nothing on record which could have let the Ld. Adjudicating Authority to provisionally attach any other property for which it could have carried reason to believe to hold that as Benami Property. Out of the total sale consideration of Rs.471.54 Lakhs for all the impugned properties only Rs.173.00 Lakhs was paid by the 8 alleged Benamidars. The interested party M/s ICON Constructions has also maintained that none of the Benamidars acquired any rights, interest and title to the impugned properties. Therefore M/s ICON Constructions continue to remain owner and in possession of the impugned properties. M/s ICON Constructions maintained that they had rented the commercial units to tenants for which they received the rental income. In view of this, the applicability of Section 2 (9) (A) is doubtful as neither the impugned properties were transferred to the alleged Benamidars nor the impugned properties were held by the alleged Benamidars. Even if we accept that there were cash infusions into the bank accounts of the alleged Benamidars, there is no evidence on record as to show that such infusions were made by the Beneficial Owner. Thus we find that neither the properties which have been provisionally attached are Benami nor the transactions which have occurred with respect to the impugned properties are Benami. We are therefore unable to interfere with the Impugned Order.

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• 2025 (1) TMI 801
  Prohibition of Benami Property Transactions - beneficial owner of subject property - HELD THAT:- We note that out of the total sale consideration of Rs.2.35 Crores for the impugned property only Rs.1.94 Crores was paid by the alleged Benamidar. The interested party M/s North Star Homes has also maintained that the Benamidar has not acquired any rights, interest and title to the impugned property. Therefore M/s North Star Homes continue to remain owner and in possession of the impugned property. The applicability of Section 2 (9) (A) is doubtful as neither the impugned property was transferred to the alleged Benamidar nor the impugned property was held by the alleged Benamidar. Even if we accept that there were cash infusions into the bank accounts of the alleged Benamidar, there is no evidence on record as to show that such infusions were made by the Beneficial Owner. We find that neither the property which has been provisionally attached is Benami nor the transaction which has occurred with respect to the impugned property is Benami. We therefore set aside the Impugned Order.

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• Customs

• 2025 (1) TMI 835
  Classification of imported goods declared as components and parts of Electric Tricycle / E-Rickshaw - to be classified under CTH 87089900 or under CTH 87038040 as complete E-Rickshaws in CKD condition? - benefit under Notification No. 50/2017-Cus. dated 30.06.2017 [Serial No. 528] - rejection of declared value - enhancement of declared value - confiscation - redemption fine - penalty - HELD THAT:- The issue is covered by the decision of this Tribunal in the case of COMMISSIONER OF CUSTOMS (PORT) KOLKATA VERSUS M/S. TWINKLE TRADECOM PRIVATE LIMITED [ 2024 (5) TMI 472 - CESTAT KOLKATA] wherein the Tribunal has observed ' The goods imported as such, by the respondent, if assembled together, will not provide the basic function of propulsion as required for the classification under CTH 8703. Accordingly, we uphold the findings of the ld. appellate authority in the impugned order and hold that the goods imported would not constitute a fully finished e-rickshaw as it did not have all essential components for a fully finished e-rickshaw.' It was also held that 'Regarding enhancement of value, we observe that the Ld. Commissioner (Appeals) has relied on the judgment of COMMISSIONER OF CUSTOMS (GENERAL CFS) , MUMBAI VERSUS RADHEY SHYAM RATANLAL [ 2017 (5) TMI 322 - CESTAT MUMBAI] and observed that the enhancement of values was done without providing any logical reasons.' Conclusion - The classification as parts, classified under CTH 87089900 upheld - duty exemption granted - value enhancement is rejected - confiscation and penalties annulled. The appeals filed by the Revenue are dismissed.

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• 2025 (1) TMI 800
  Seeking provisional release of the goods - release of various models of second hand Highly Specialised Equipment digital Multifunction Print, Copying Scanning Machines, imported by the petitioner - authorization for importing multi-functional device - it was held by High Court that 'it is ordered that let the respondent authorities pass an order on the application filed by the petitioners for provisional release of the goods subject to the conditions.' HELD THAT:- It is not inclined to interfere with the order passed by the High Court, it is made clear that provisional release of the goods shall be subject to final orders to be passed by the Department concerned in the adjudication proceedings under the provisions of the Act. The Special Leave Petitions are disposed of.

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• 2025 (1) TMI 799
  Seeking a direction to quash and set aside the Seizure Memo - seizure of used and second-hand Digital Multifunction Printing and Copying Machines of the Petitioner - HELD THAT:- It would be in the fitness of things if the Department is directed to provisionally release the old and used Digital Multifunction Printing and Copying Machines which form the subject matter of Bill of Entry No.8536253 dated 30th October 2023, subject to certain terms and conditions. Respondent No. 4, the Commissioner of Customs, shall intimate to the Petitioner, the additional customs duty payable on or before 29th January 2025. Once the additional customs duty is intimated to the Petitioner, the same shall be paid by the Petitioner within seven days from the date of receipt of the said intimation. Petition disposed off.

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• 2025 (1) TMI 798
  Confiscation of two gold kadas and one gold chain of the Petitioner - personal effects would not include jewellery - baggage rules - HELD THAT:- A perusal of the Baggage Rules or the Declaration Form does not show that this position, qua declaration of the jewellery, is duly clarified to travellers/tourists visiting India. It is seen by this Court in a number of writ petitions, that even small quantities of jewellery is sometimes seized by the Customs Department if the passenger is walking through the green channel - which is for passengers not having any dutiable or prohibited goods. Moreover, the Court is of the view that the Baggage Rules may also require a re-look, considering the market rate of gold at present, where forty grams of gold would be costing much more the value cap of Rs. 1,00,000/- prescribed under Rule 5 of Baggage Rules. With the maximum limit of Rs.1,00,000/-, the gold that could be purchased may only be around 15 grams. Let this matter be referred to the Chairman, CBIC for reconsideration of the Baggage Rules 2016. Let the re-consideration be undertaken in coordination with any other Departments or Ministries as may be required and the report be filed before this Court regarding the reconsideration and the manner thereof. The report shall be filed by the next date of hearing - Issue notice to the Respondents.

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• 2025 (1) TMI 797
  Interpretation of statute - the word and as appearing in Custom Tariff Item (CTI) 8517 (iv) is to be read in a disjunctive manner - exemption eligibility for Wireless Access Points (WAPs) operating solely on Multiple Input/Multiple Output (MIMO) technology under the amended Notification No. 24/2005-Cus. - whether the WAPs, which work on MIMO technology, imported by the respondent would qualify for an exemption from Basic Customs Duty? - HELD THAT:- In the present case, there is no such ambiguity or absurdity. In our view, when all the four entries of Serial No. 13 are analysed, it would lead to only one conclusion that the word and is to be read in conjunctive manner only, and the phrase MIMO and LTE Products would refer to only those products which have both MIMO technology and LTE standard. The Notification No. 25/2005, and one Notification No. 57/2017-Customs were amended and the phrase MIMO and LTE Products were substituted with (i) MIMO products; (ii) LTE products , and that these amendments were clarificatory in nature, is concerned, notably, an amendment in the Notification No. 57/2017-Customs was brought vide Finance Act, 2021 which is clarificatory in nature, and, clarifies Serial No. 20 of the said notification. It states that the subject entry will now be read as (i) MIMO products; (ii) LTE products . Similar change was brought in Notification No. 25/2005 by virtue of Notification No. 05/2021-Customs. The clarification is brought about in the Statute when there is ambiguity and disputes arise due to such ambiguities. The fact that a clarification is needed to be brought about in the subject entry by the Finance Act, 2021 would point out towards the inherent ambiguity experienced in its interpretation and application which prompted and necessitated the subject amendment and clarification - exclusion clause (iv) of Serial No. 13 of the amended Notification No. 24/2005, which reads as MIMO and LTE products , would have to be read in its original form applying the law and rules of interpretation of statutes, especially as applicable in cases of taxation. Conclusion - The phrase MIMO and LTE Products in Serial No. 13 (iv) of the amended Notification No. 24/2005 applies solely to products combining MIMO technology and LTE standards. The exclusion clause cannot be stretched to encompass products featuring either one of the two technologies. Accordingly, the WAPs imported by the respondent, which employ MIMO technology but not the LTE standards, are entitled to the exemption from Basic Customs Duty. The Question of Law is accordingly answered in favour of the assessee, and against the Revenue - The appeal is accordingly dismissed.

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• 2025 (1) TMI 796
  Breach of the timeline prescribed under the Customs Brokers Licensing Regulations, 2018 (CBLR) for the suspension or revocation of the customs broker license - breach of the provisions under regulations 10(d) 10(e) of CBLR, 2018 by the customs broker. Whether, in the given facts of the case, there has been any breach of time line prescribed under CBLR, 2018 for suspension or revocation of license granted under CBLR? - HELD THAT:- The Coordinate Bench at Delhi in the case of Rishad Shipping Clearing Agency Ltd Vs CCE CGS, Indore [ 2020 (3) TMI 270 - CESTAT NEW DELHI ] held time line as mandatory after examining conflicting decisions of various High Courts and Tribunals. It was observed that there are two sets of decisions, where the Delhi High Court and Madras High Court have held that time limit prescribed for issuance of notice within 90 days from the date of receipt of offence report is mandatory in nature and the Bombay High Court and Kolkata High Court have held that issuance of notice within stipulated time limit is not mandatory but directory in nature. Since in this case we have already found that department itself was describing the time line provided in CBLR as sacrosanct, hence we rely on the judgments of Hon ble High Court of Delhi and Madras, wherein, it was held that time line prescribed in the CBLR is mandatory and since in the present appeal the SCN has been admittedly issued beyond 90 days, thus, on this count itself, the SCN is not tenable and subsequent revocation of license based on this SCN is also liable to be set aside. Whether, in the given facts of the case, there is any breach of the provisions under regulations 10(d) 10(e) of CBRL, 2018? - HELD THAT:- As can be seen from Regulation 10(d), the customs broker is required to advice his client to comply with the provisions of the Act and in case of non-compliance, he is required to bring the matter to the notice of Deputy Commissioner of Assistant Commissioner of Customs. In this case, it is apparent that the client was the same appellant company but in the capacity of importer. Therefore, there is nothing on record that they had not advised their client about the statutory provisions - the charges leveled against the appellant under Regulation 10(d) are not tenable, in the facts of the case. Moreover, exactly what provisions of the Act or other allied Acts or Rules were not advised by the appellant to his client is also not forthcoming in the charges leveled against the appellant in the SCN. Therefore, unless there is a very clear ground about the charges leveled, the appellant would not get an opportunity to defend his case - A general reliance on the entire SCN, without elaborating which parts were relied upon for establishing the breach of regulation 10(d) by the customs broker, would not be correct. Thus, the charges under regulation 10(d) are not sustainable. Similarly, the provisions under regulation 10(e) is also very clear, which essentially provides for that the customs broker needs to exercise due diligence in communicating correct information to his client with reference to any work relating to clearance of cargo. Nothing in the SCN dt.13.03.2024 is showing as to what wrong information was provided by the appellant, in their capacity as customs broker to the appellant, acting as importer. Merely because they are the same company, it could not be presumed that everything which was known to the company, as importer was also known to the appellant, as customs broker, unless detailed evidence is brought on record - at the first opportunity itself the customs broker has in fact, tried to ascertain the correctness of information and had filed the Bill of Entry based on all the documents which were otherwise found to be genuine. This, in itself, would suffice that they had exercised reasonable due diligence. It is also to be noted that out of 17 obligations, the department would charge only on two counts i.e., 10(d) 10(e) and therefore, in respect of other obligations, they were not found to be noncompliant. Thus, to invoke 10(e) in this case without substantial evidence directly implicating them in positive manner in smuggling of goods, is not tenable. Conclusion - The time line prescribed in the CBLR is mandatory and since in the present appeal the SCN has been admittedly issued beyond 90 days, thus, on this count itself, the SCN is not tenable and subsequent revocation of license based on this SCN is also liable to be set aside. The mandatory nature of the timeline for issuing SCNs under CBLR was affirmed. The necessity for substantial evidence to support charges under regulations 10(d) and 10(e) was emphasized. The impugned order revoking the license of the appellant as well as forfeiture of security deposit and imposition of penalty for violation of 10(d) and 10(e) of CBLR is set aside - the impugned order is not sustainable on account of delay in issuing SCN as well as on account of non-substantiating the grounds for invoking regulations 10(d) 10(e). Appeal allowed.

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• 2025 (1) TMI 795
  Classification of imported Optical Power Ground Wire Fibre Cable (OPGW) and its accessories - to be classified under the Customs Tariff Heading 8544 and the accessories under CTH 853670 respectively or under CTH 9001 and heading 7616 respectively? - applicability of Boards instruction contained in Circular 12/2006-Cus dated 28/02/2006 issued from F No 528/8/2006-Cus(TU) - HELD THAT:- The circular states that the optical fibres of Heading 8544 are made of individually sheathed fibres, whereas cables of Heading 9001 are not individually sheathed and specifically excluded products of 8544. This alert was all the more reason to preserve clinching evidence of the product by drawing samples and seeking the opinion of an expert. This critical evidence is missing in the present case. The goods have also been cleared for home consumption and are not available for examination. It is seen that the imports were made against a contract with TNEB. It was very likely that the contract would specify the product description and requirement which could have been used as a reference point. However, the same has also not been relied upon in the impugned order. While seeking to classify a product it was for the departmental authorities to gather the product specification / literature, process of manufacture, compliance to a recogonised standard, contract copy and if required even a test report/ opinion from the appropriate authority and make it a part of the SCN. Classification cannot be made by assumptions and presumptions however so nuanced the order may be, when OPGW available in the market can be both sheathed and unsheathed, as recogonised in the Boards circular above. Moreso when it is this characteristic which is critical for the products classification. Further ultimate usage of a product is not relevant for classification, when the tariff entry refers to no such end use. The rule of best evidence states that, so long as higher or superior evidence could have been produced or may be reached, no inferior proof shall be submitted in relation to it. Hence in this case there can be no substitute for going by the actual physical characteristics and description of the impugned goods. Further it is not even the case of revenue that the goods were shown to be manufactured adhering to a recogonised standard that incorporates the characteristics relevant for the classification. Revenue has hence failed to prove its case on the classification of the goods under Tariff Heading 9001 and the impugned order merits to be set aside. Conclusion - The classification of goods must be based on actual physical characteristics, and authorities must provide conclusive evidence to support their claims. The absence of such evidence undermines the validity of the classification and any consequent denial of exemptions. The classification under Heading 9001 was not justified, and the exemption denial was incorrect. Appeal disposed off.

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• Corporate Laws

• 2025 (1) TMI 794
  Justification of Claim Management Advisor (CMA) in categorizing the claims related to delay in possession as put under adjudication - HELD THAT:- The CMA has categorically stated that the reimbursement of rent was not provided for in any document entered into between the Appellants and Maytas and there was no commitment to pay rent. In terms of the claims management process under the resolution framework, there is a clear distinction between verification of claim and adjudication of claim. The CMA has categorically and consistently stated that the reimbursement of rent was not provided for in any document entered into between the Appellants and Maytas and there was no commitment to pay rent to the Appellants. On looking into the clauses of the Agreement also, there are no provision for payment of loss of rent or alternative accommodation rent being the relevant parameter for quantification of damages for delay in construction. Given this backdrop, the CMA was right in asserting that he cannot verify any claim basis rental agreements unilaterally produced by the Appellant when the Agreement did not provide scope for such rental agreements to determine the damages for delayed possession. Under such circumstances, it is not found either unreasonable or unfair on the part of the CMA in having pointed out that any claim premised on the above parameters would fall in the realm of adjudication which would be beyond the limited jurisdiction of the CMA. The CMA clearly did not have the jurisdiction to determine the claim, nor are there any mitigating factors in the IBC or the CIRP Regulations framed thereunder bestowing any such adjudicatory jurisdiction on the CMA. Conclusion - There are no reason to differ with the findings of the Adjudicating Authority that the claims on account of delayed delivery of flat and mental agony is in nature of unliquidated damages and there is no agreement between the parties for payment of the same, hence the same cannot be admitted. Appeal dismissed.

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• Insolvency & Bankruptcy

• 2025 (1) TMI 834
  Recovery of dues - Approval of decision of New Board to collapse/ unwind the transactions whereby IL FS Financial Services Ltd. (IFIN) has provided loans to third parties - rejection of IFIN's claim by the Interim Resolution Professional (IRP) of Attivo Economic Zone (Mumbai) Pvt. Ltd. in the Corporate Insolvency Resolution Process (CIRP) - HELD THAT:- One of the steps, which has been contemplated is an Agreement between IL FS and third party borrowers for collapsing the Agreement and the orders were sought only with respect to collapsing the Agreement, when Agreement is entered. Admittedly, there is no Agreement, which claimed to have been admitted / entered with regard to Respondent Nos.8 to 12 of IA No.3169 of 2023 and objections having been raised with regard to Respondent Nos.8 to 12 by SIFL , claiming that amount advanced to IL FS entities by third party borrowers, like Respondent Nos.8 to 12 was the amount given by the SIFL and not by third party borrowers. Hence, the said transactions with IL FS entities, cannot be collapsed. For issuing any directions as prayed by the Applicant with regard to Respondent Nos.8 to 12, a deeper and thorough consideration is required with regard to transactions with third party borrowers as well as lending money to IL FS entities. Present Applications, are not the appropriate proceedings to grant declaration as prayed by the Applicant and direct for collapsing the third party Agreements and transactions entered with Respondent Nos.3 to 12. It is made clear that the said issues can be gone into and examined by NCLT in the pending proceedings and appropriate decisions can be taken with regard to borrowing with respect to Respondent Nos.8 to 12. Conclusion - The proposal to unwind transactions allowed with the exception of certain respondents - the IRP's rejection of IFIN's claim set aside, restoring its status in the CIRP. Application allowed in part.

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• 2025 (1) TMI 793
  Dismissal of Section 9 Petition against the Respondent on the ground that debt claimed is below the threshold limit and the interest amount is disputed - interest component claimed by the Appellant can be included as part of the operational debt under Section 5(21) of the IBC or not - claims and counter claims of the threshold limit under Section 4 of the IBC - Exclusion of Claims falling within the Section 10 A period - Pendency of Commercial Suit between the parties. Claims and counter claims of the threshold limit under Section 4 of the IBC - HELD THAT:- Section 5(21) of IBC Code provides that: operational debt means a claim in respect of the provision of goods or services including employment or a debt in respect of the 4[payment] of dues arising under any law for the time being in force and payable to the Central Government, any State Government or any local authority; of the IBC restricts claims to those arising from goods or services, and interest is recoverable only when expressly agreed upon by the parties. In the absence of such agreement, the interest component cannot be considered part of the operational debt. Consequently, without interest the outstanding principal amount alone is Rs 60,44,800/- and is well below the threshold of Rs 1 crore specified under Section 4 of the IBC. No interest can be charged against the supply of goods and services for delayed payments until and unless there is an express agreement between the parties - there are justification in the claim of the Respondent that the interest claim was unilaterally imposed and lacked any contractual basis. Exclusion of Claims falling within the Section 10 A period - HELD THAT:- The Respondent has placed his reliance on the judgment of this Tribunal in DECOR PAPER MILLS LTD. VERSUS MAHASHAKTI PLASTO PVT. LTD. [ 2024 (11) TMI 1412 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL, NEW DELHI [LB]] which establishes that invoices falling within the 10 A period must be excluded from default claims. Therefore, the Application filed by the Appellant under Section 9 is not maintainable on this count also, as the default amount is below the statutory threshold - it is to be noted that even if the dispute relating to invoices falling within 10 A period is not raised by the Respondent, as is being argued by the Appellant, it is not a bar as it is the duty of the Adjudicating Authority to scrutinise whether the invoices are barred by law or not. Pendency of Commercial Suit between the parties - HELD THAT:- The Appellant filed a Commercial Suit for the same claim on 01.05.2023, prior to issuing the Demand Notice on 23.08.2023. The Corporate Debtor had in his reply to the demand notice had clearly brought out the existence of pre-existing dispute as well as the pendency of this suit. Due to a pre-existing dispute between the parties, such a petition cannot be entertained under Section 8 of the Code. Therefore, the Appeal is not maintainable on this count also. Conclusion - The debt claim was below the statutory threshold; interest was not contractually justified; claims within the Section 10 A period were excluded; the pending commercial suit barred the insolvency application. Section 9 Petition is not maintainable on multiple counts - appeal dismissed.

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• PMLA

• 2025 (1) TMI 792
  Money Laundering - seeking time - applicability of rigours of clause (ii) of sub-Section (1) of Section 45 of the PMLA - HELD THAT:- The counter affidavit to be filed by 10th January, 2025. List the Petition on 15th January, 2025.

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• Service Tax

• 2025 (1) TMI 791
  Condonation of delay in filing appeal - Levy of service tax - Auction of abandoned imported goods by the CONCOR - ground rent/storage rendered towards the un-cleared/un-claimed cargo of the importer - Amount accrued to CONCOR under Section 150(2)(d) of the Customs Act, 1962 - consideration for the provision of storage and warehousing services or not - it was held by CESTAT that 'the issue whether the service tax can be demanded on the sale proceeds of the auction of the abandoned imported goods is no longer res integra and has been decided in favour of the assessee and it has been settled that in the whole transaction, no service recipient exists and, therefore, there is no question of providing any service to any person.' HELD THAT:- There is a delay of 138 days in filing the appeal which has not been satisfactorily explained by the appellant. The Civil Appeal is, accordingly, dismissed on the ground of delay.

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• 2025 (1) TMI 790
  Condonation of delay in filing appeal - Extended period of limitation - Petitioner s liability for payment of the service tax on works contracts executed during the period of 2014-15 to 2017-18 - It is the petitioner s case that in terms of Section 129 of the Finance (No. 2) Act, 2019, no proceedings can be initiated in respect of service tax for the period 2014-15 to 2017-18 and no further demands can be raised - It was held by High Court that 'NOIDA does not require to be registered under any Act as a body corporate, as it has been constituted by the Uttar Pradesh Industrial Area Development Act, 1976 as a body corporate. Thus, clearly the Revenue has misunderstood the response received from NOIDA as is reflected in the impugned show cause notice.' HELD THAT:- There is a delay of 330 days in filing the Special Leave Petition which has not been satisfactorily explained. Even otherwise, on going through the Special Leave Petition and there are no merit in the same. The Special Leave Petition is, therefore, dismissed on the ground of delay as well as on merits.

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• 2025 (1) TMI 789
  Validity of payment under the Sabka Vishwas (Legacy Dispute Resolution) Scheme (SVLDRS), 2019, made after the due date - attachment of the petitioner's property - HELD THAT:- As per the SVLDRS 2019, the petitioner filed Sabka Vishwas Scheme application on 02.10.2019 and subsequently SVLDRS Form-3 was issued by the designated committee for payment. The petitioner had to pay an amount of Rs. 35,23,866/- by the due date i.e. by 30.06.2020. But he failed to pay the said amount by the said date. The plea taken by the petitioner was that due to COVID-19 pandemic, as the business was completely closed, they could not generate any funds, could not make payment within the said time. However, as per the petitioners they accumulated funds and paid a sum of Rs. 15,00,000/- on 07.01.2021 and Rs. 20,23,866/- on 01.03.2021 and completed the payment of balance amount. Thus, the amounts recovered were not payments made by the petitioner within the stipulated period, but subsequently by the Department in the process of recovery of arrears. As the petitioner could not comply the terms as mentioned in the scheme and had not made the payments within the stipulated period, the petitioner could not avail the benefit offered under the said scheme. The petitioner was required to follow the provisions of the scheme in toto and to pay the amount determined under SVLDRS Form-3 within the stipulated time in terms of Section 127 (4) of the Finance Act, 1994. The recovery made by the Department under Section 87 of the Finance Act, 1994 could not be considered as payment made by the petitioner under SVLDRS scheme. Since there was a legal impediment because of which the petitioner therein could not comply with the requirement, interference was made. This is trite that a singular different fact/point may change the precedential value of a judgment. Conclusion - As the petitioner was having interest in the firm and became Managing Partner of the firm after entering the reconstituted partnership deed dated 26.09.2015, there is no need to interfere with the attachment order passed by the Department against the petitioner. As such, there are no merit in the contention of the learned Senior Counsel for the petitioner to raise the attachment order and to allow the petition. Petition dismissed.

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• 2025 (1) TMI 788
  Levy of service tax - miscellaneous income of Rs. 6 crores declared by the respondent to the Income Tax Department - imposition of penalty under Section 78(1) of the Finance Act, 1994 - HELD THAT:- The present demand was proposed based on the statement of the director of the respondent where he simply stated that the amount disclosed to IT department was received from construction services. Apparently and admittedly, the respondent was providing various taxable services the said statement is not admissible in evidence till corroborated by any documentary evidence. Subsequent to the impugned order also the department has not produced any evidence to prove that the respondent had generated said disputed income / amount disclosed to IT department on account of providing taxable services. The proposal of demand of service tax on the income declared under survey to IT department cannot otherwise sustain. The proposal was purely on the basis of assumption and presumption. Hence, there are no infirmity in the part of the order challenged by the department. Conclusion - Such a serious charge of evasion of service tax requires the Department to produce sufficient and tangible corroborative evidences and it cannot simply be based on presumptions and assumptions. The original adjudicating authority's decision to drop the demand for service tax on the miscellaneous income upheld, finding no evidence to support the department's claims. The appeal filed by the department is hereby dismissed.

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• 2025 (1) TMI 787
  Refund of service tax paid - rejection on the ground that appellant has failed to pass the bar of unjust engagement - HELD THAT:- As it is evident from the record that service recipient has not remitted any Service Tax towards the services rendered by the appellant. In that circumstances the appellant has passed the bar of unjust engagement, therefore, bar of unjust engagement is not applicable to the facts of this case. Larger Bench of this Tribunal in the case of M/S VIAVI SOLUTIONS INDIA PVT. LTD. VERSUS THE COMMISSIONER OF CGST, GURGAON-I [ 2024 (6) TMI 187 - CESTAT CHANDIGARH] wherein it has been held that in case of refund claims filed under Service Tax laws, the decision of ITC LIMITED VERSUS COMMISSIONER OF CENTRAL EXCISE, KOLKATA -IV [ 2019 (9) TMI 802 - SUPREME COURT (LB)] is not applicable as the same is related with the cases of Customs. In that circumstances the decision of ITC Ltd. is not applicable to the facts of the case. The appellant is entitled to claim the refunds - Appeal allowed.

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• Central Excise

• 2025 (1) TMI 786
  Clandestine removal - evasion of huge amount of tax by suppressing the amount of royalty paid by the franchisee units - suppression of production of finished product - admissible and corroborative evidences or not - Levy of penalties. HELD THAT:- The fact that the Appellant ever paid a higher amount of royalty to M/s KIL is not factually correct and established, the fact that the Appellant manufactured and cleared the higher quantity of goods corresponding to such alleged higher payment of royalty is not established or proved. Further, there is neither any evidence of any excess consumption of electricity nor any evidence whatsoever and howsoever with regard to any clandestine procurement of raw materials or of production of any excess TMT Bars, use of labour, transporter, etc. No evidence regarding buyers of such alleged clandestine manufactured goods or any receipt of consideration against such alleged clandestinely manufactured goods. Thus, without adducing any evidence in support of such facts, a charge of clandestine removal cannot be sustained merely on assumption and presumption due to such alleged higher amount of royalty recorded by M/s KIL, where even correctness and truthfulness of such recording itself is not established. Reliance in this regard is placed upon the following judgment of the Hon ble Allahabad High Court in M/S. CONTINENTAL CEMENT COMPANY VERSUS UNION OF INDIA OTHERS [ 2014 (9) TMI 243 - ALLAHABAD HIGH COURT] , wherein the Court categorically stated ' no case is made out for extra so-called clandestine sale of the Portland Cement to the said parties. We are satisfied that the first appellate authority has rightly deleted the addition and cancel the penalties.' The above-mentioned judgment of the Hon ble High Court has been relied by the Tribunal in the matter of M/S GIRIRAJ IROSTEEL COMPANY PVT. LTD., SHRI SUNIL KUMAR AGARWAL, SHRI PURUSHOTTAM RATHI VERSUS COMMISSIONER OF CENTRAL EXCISE [ 2019 (12) TMI 542 - CESTAT ALLAHABAD] , wherein the facts were similar to the present case framed based on the same facts of alleged recording of higher royalty by M/s KIL and the Tribunal set aside the demand by holding ' manufacture of such quantity of goods on which Central Excise duty of around Rs. 5.5 crores was demanded is not established. Since Central Excise duty is on manufacture and manufacture is not established, therefore, there is no basis for demand of Central Excise duty to the tune of Rs. 5,58,89,762/-. Since the demand is not sustainable the penalty is on the appellants are not sustainable.' It is a well settled law that resumption of loose slips or private records resumed from the third party, or statements recorded behind the back of the Appellant cannot be made the basis of confirming demand on the Appellants unless the same are proved to be linked to the Appellant. Further, even it is assumed such entries existed, but that does not prove that the Appellant in fact made any such higher amount of payment in absence of any corroborative evidence - once such printout is not admissible in evidence then nothing survived in this case to hold clandestine clearance of the goods by the Appellant. In absence of cross examination of witnesses, the documents recovered as well as their statements cannot be relied upon against the Appellant in view of decision of Hon'ble Allahabad High Court in the case of COMMISSIONER OF CENTRAL EXCISE, MEERUT-I, MEERUT ANOTHER VERSUS M/S PARMARTH IRON PVT. LTD., BIJNOR. [ 2010 (11) TMI 109 - ALLAHABAD HIGH COURT] , wherein it has been held that ' there is no requirement in the Act or Rules, nor do the principles of natural justice and fair play require that the witnesses whose statements were recorded and relied upon to issue the show cause notice, are liable to be examined at that stage. If the Revenue choose not to examine any witnesses in adjudication, their statements cannot be considered as evidence. However, if the Revenue choose to rely on the statements, then in that event, the persons whose statements are relied upon have to be made available for cross-examination for the evidence or statement to be considered.' Penalty on Director - HELD THAT:- The Appellant has simply appeared as a proxy of Mr. Navin Jain to submit documents. He has neither any authorization by the Company to tender a statement nor any summons were issued to the Appellant under Section 14 of the Central Excise Act, 1944. The DGCEI, Kanpur in most cryptic manner simply to fulfil their formalities, recorded a statement of the person, who did not even have any authority letter even from Mr. Navin Jain, who was main director looking after overall work. Penalty on Appellant No.3 - HELD THAT:- The clinching evidence of the nature of purchase of raw material, use of electricity, sale of final products, clandestine removal and the more flowback of funds are required to be established in the case of clandestine removal. Such aspects have not been investigated into and therefore, the judgement of Hon ble Allahabad High Court in the case of M/S. CONTINENTAL CEMENT COMPANY VERSUS UNION OF INDIA OTHERS [ 2014 (9) TMI 243 - ALLAHABAD HIGH COURT] is applicable to the facts of the present case. The penalty imposed is set aside. Conclusion - Clandestine removal is a serious charge against the manufacturer, which is required to be discharged by the Revenue by production of sufficient and tangible evidence. The demands and penalties cannot be based on assumptions or insufficient evidence. The entire demand alleging clandestine removal is not sustainable and accordingly the entire demand confirmed against the Appellant is set aside. As the demand of duty is not sustainable, therefore, no penalty can be imposed. Appeal allowed.

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• 2025 (1) TMI 785
  Admissibility of CENVAT Credit passed on through ISD invoices - input service of advertisement /sale promotion - HELD THAT:- The issue herein is squarely covered in favour of the Appellant by the Larger Bench ruling of this Tribunal in the case of Krishna Food Products [ 2021 (5) TMI 906 - CESTAT NEW DELHI (LB) ]. Under similar facts and circumstances, the Division Bench of this Tribunal held that ' This issue is whether the appellant would, irrespective of the answer to the first issue, be entitled to avail CENVAT credit when input service is attributed to the goods on which excise duty is paid and includes the cost of services on which credit was taken.' Conclusion - The issuance of ISD invoices by Parle Biscuits Pvt. Ltd. to its CMU was legal and correct. The appellant was entitled to avail CENVAT credit for input services attributed to the goods on which excise duty was paid. Appeal allowed.

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• 2025 (1) TMI 784
  Refund of the duty paid under Rule 10A of the Central Excise Valuation (Determination of Price of Excisable Goods) Rules, 2000 - HELD THAT:- This case is no longer res integra having been decided by the Tribunal in the case of Audi Automobiles [ 2009 (5) TMI 426 - CESTAT, NEW DELHI] and a number of cases involving one of the bodybuilders. Following this decision, this Bench has decided the case involving M/S SITA SINGH SONS P. LTD., M/S SML ISUZU LTD. VERSUS CCE, DELHI-IV [ 2016 (7) TMI 346 - CESTAT CHANDIGARH] on more than one occasion against the appellants. CESTAT in the case of Audi Automobiles [ 2009 (5) TMI 426 - CESTAT, NEW DELHI] held that ' it is apparent that the said firms had cleared the goods in relation to the body fabricating and mounting on the chassis which were supplied to the said firms free of cost by the manufacturer of chassis. Being so, the activity for the purpose of valuation would squarely fall under Rule 10A and not under Rule 6. We, therefore, do not find any illegality in the impugned order as far as the demand of duty and interest payable thereon from the appellants.' Conclusion - The transactions involving job work on behalf of a principal manufacturer fall under Rule 10A for valuation purposes, and the principal manufacturer bears the duty liability. Appeal dismissed.

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• Indian Laws

• 2025 (1) TMI 783
  Power of Bombay High Court to condone the delay in filing appeals beyond the period stipulated under Section 74(1) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 - interpretation of Section 74 of the 2013 Act - express exclusion to the applicability of Section 5 of the Limitation Act, 1963 - HELD THAT:- As per the provisions of Section 29(2) of the Indian Limitation Act, 1908 if there was any delay in filing an appeal under a special or local law, one could not take the aid of Section 5 to condone the delay. Under the Limitation Act, 1963, there is a complete departure from this position. Under the Limitation Act, 1963, where any special or local law prescribes for any suit, appeal or application, a period of limitation different from the Schedule of said Act, for the purposes of determining any period of limitation for any suit, appeal or application prescribed by such special or local law, the provisions contained in Sections 4 to 24 shall apply, unless and to the extent they are expressly excluded by the language of such special or local law. In other words, Section 5 of the Limitation Act, 1963 would apply [unlike under Section 29(2)(b) of the Indian Limitation Act, 1908], unless expressly excluded by the language of the concerned special or local law. The question that remains is whether in the language used in Section 74 of the 2013 Act there is an express exclusion to the applicability of Section 5 of the Limitation Act, 1963. On perusing the provisions of Section 74, it is clear that when the said section is read as a whole, the inescapable conclusion is that Section 5 of the Limitation Act, 1963 cannot be invoked for condoning the delay beyond the total period of 120 days as stipulated in Section 74(1) read with its proviso. If the legislature had in fact intended that Section 5 of the Limitation Act, 1963 would apply to an appeal to be filed under Section 74(1) of the 2013 Act, the legislature would not have inserted the proviso to Section 74(1) which [after the initial period of sixty days to file an appeal under Section 74(1)], gives power to the High Court to condone the delay for a further period not exceeding sixty days. The proviso to Section 74(1) specifically stipulates that the High Court shall have the power to condone the delay, after the initial period of sixty days, for a further period not exceeding sixty days. This would most definitely amount to an express exclusion to the applicability of Section 5 of the Limitation Act, 1963, to an appeal to be filed under Section 74(1) of the 2013 Act. To hold that the High Court can entertain an appeal even beyond the extended period [as stipulated in the proviso to Section 74(1)] would render the words not exceeding sixty days wholly otiose. On reading the proviso to Section 74(1) of the 2013 Act, and which is not only almost identical to the provisions of 125 of the Electricity Act, 2003, but also similar to the provisions of Section 421(3) of the Companies Act, 2013, the inescapable conclusion is that the proviso to Section 74 (1) expressly excludes the applicability of Section 5 of the Limitation Act, 1963. Once this is the case, there are no power to condone the delay beyond the maximum period of 120 days as stipulated in Section 74(1) read with its proviso, by resorting to the provisions of Section 5 of the Limitation Act, 1963. Conclusion - There are no hesitation in holding that beyond the total period of 120 days as stipulated in Section 74(1) [read with its proviso] of the 2013 Act, this Court has no power to condone the delay. Since, admittedly in the facts of the present case, both the applications [seeking condonation of delay] filed by the Appellant are beyond the total period of 120 days. Both the applications seeking a condonation of delay are hereby dismissed.

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• 2025 (1) TMI 782
  Dishonour of Cheque - whether condition imposed by the Sessions Judge, requiring the applicant to deposit 20% of the fine amount under Section 148 of the Negotiable Instruments (NI) Act, is justified? - HELD THAT:- Having gone through the provision of Section 148 of the N.I. Act and after taking into consideration the observations recorded by the Hon ble Supreme Court in ASHOK KUMAR VERSUS STATE OF UTTARAKHAND ANR. [ 2023 (11) TMI 1338 - SC ORDER] , this Court is of the considered view that in normal circumstances, the Appellate Court may be justified in imposing the condition of deposit, as provided in Section 148 of the N.I. Act, and only in those cases, where imposing the condition of deposit is unjust or which may deprive the accused/appellant to pursue his appeal, an exception can be drawn by deviating from the normal procedure. In such view of the matter, this Court is of the firm opinion that the Case Law relied upon by learned counsel for the applicant in the case of Ashok Kumar is not applicable in the facts and circumstances of the present case. Conclusion - The Court finds that no special circumstance exists in the present case, and the condition of deposit of 20% compensation will neither be unjust nor it will amount to deprivation of the right of appeal to the applicant. Application dismissed.

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