TMI Tax Updates - e-Newsletter
October 4, 2021

Case Laws in this Newsletter:

GST Income Tax Customs Insolvency & Bankruptcy PMLA Central Excise CST, VAT & Sales Tax Indian Laws

News

1. GST Revenue collection for September 2021

2. PFRDA observes NPS Diwas on today with planned initiatives to increase awareness and pension coverage in India

3. ECGC assures exporters to provide cost-effective credit insurance cover

Notifications

Customs

1. 57/2021 - dated 30-9-2021 - ADD

Seeks to amend notification No. 16/2020 Customs (ADD), dated the 23rd June, 2020 so as to extend the temporary revocation of the operation of the said notification up to 31st January, 2022.

2. 56/2021 - dated 30-9-2021 - ADD

Seeks to amend notification No. 38/2019 – Customs (ADD) dated 25th September, 2019 so as to extend the temporary revocation of the operation of the said notification up to 31st January, 2022.

3. 55/2021 - dated 30-9-2021 - ADD

Seeks to amend notification No. 54/2018 – Customs (ADD) dated 18th October, 2018 so as to extend the temporary revocation of the operation of the said notification up to 31st January, 2022.

4. 54/2021 - dated 30-9-2021 - ADD

Seeks to amend notification No. No. 29/2017-Customs (ADD), dated the 14th June, 2017 to extend levy of anti-dumping duty on “Glazed/Unglazed Porcelain/Vitrified tiles in polished or unpolished finish with less than 3% water absorption” from China PR upto 28th February, 2022

5. 5/2021-CUSTOMS (CVD) - dated 30-9-2021 - Cus

Seeks to amend notification No. 01/2017 – Customs (CVD) dated 7th September, 2017 so as to extend the temporary revocation of the operation of the said notification up to 31st January, 2022.

6. 47/2021 - dated 30-9-2021 - Cus

Seeks to implement GST Council recommendation on IGST on imports related to goods from Antarctica and Border haats.

7. 46/2021 - dated 30-9-2021 - Cus

Seeks to amend Notification No. 50/2017-Customs, dated the 30th June, 2017

8. 79/2021 - dated 30-9-2021 - Cus (NT)

Fixation of Tariff Value of Edible Oils, Brass Scrap, Areca Nut, Gold and Silver

9. 78/2021 - dated 30-9-2021 - Cus (NT)

Sea Cargo Manifest and Transhipment (Eighth Amendment) Regulations, 2021.

GST

10. 12/2021 - dated 30-9-2021 - CGST Rate

Seeks to exempt CGST on specified medicines used in COVID-19, up to 31st December, 2021

11. 11/2021 - dated 30-9-2021 - CGST Rate

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

12. 10/2021 - dated 30-9-2021 - CGST Rate

Seeks to amend Notification No. 4/2017- Central Tax (Rate), dated the 28th June, 2017

13. 09/2021 - dated 30-9-2021 - CGST Rate

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

14. 08/2021 - dated 30-9-2021 - CGST Rate

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

15. 07/2021 - dated 30-9-2021 - CGST Rate

Seeks to amend notification No. 12/2017- Central Tax (Rate) so as to implement recommendations made by GST Council in its 45th meeting held on 17.09.2021.

16. 06/2021 - dated 30-9-2021 - CGST Rate

Seeks to amend notification No. 11/2017- Central Tax (Rate) so as to notify CGST rates of various services as recommended by GST Council in its 45th meeting held on 17.09.2021.

17. 01/2021 - dated 30-9-2021 - GST CESS Rate

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

18. 12/2021 - dated 30-9-2021 - IGST Rate

Seeks to exempt CGST on specified medicines used in COVID-19, up to 31st December, 2021

19. 11/2021 - dated 30-9-2021 - IGST Rate

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

20. 10/2021 - dated 30-9-2021 - IGST Rate

Seeks to amend Notification No. 4/2017- Integrated Tax (Rate), dated the 28th June, 2017

21. 09/2021 - dated 30-9-2021 - IGST Rate

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

22. 08/2021 - dated 30-9-2021 - IGST Rate

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

23. 07/2021 - dated 30-9-2021 - IGST Rate

Seeks to amend notification No. 09/2017- Integrated Tax (Rate) so as to implement recommendations made by GST Council in its 45th meeting held on 17.09.2021.

24. 06/2021 - dated 30-9-2021 - IGST Rate

Seeks to amend notification No. 08/2017- Integrated Tax (Rate) so as to notify CGST rates of various services as recommended by GST Council in its 45th meeting held on 17.09.2021.

25. 12/2021 - dated 30-9-2021 - UTGST Rate

Seeks to exempt CGST on specified medicines used in COVID-19, up to 31st December, 2021

26. 11/2021 - dated 30-9-2021 - UTGST Rate

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

27. 10/2021 - dated 30-9-2021 - UTGST Rate

Seeks to amend Notification No. 4/2017- Union territory Tax (Rate), dated the 28th June, 2017

28. 09/2021 - dated 30-9-2021 - UTGST Rate

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

29. 08/2021 - dated 30-9-2021 - UTGST Rate

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

30. 07/2021 - dated 30-9-2021 - UTGST Rate

Seeks to amend notification No. 12/2017- Union Territory Tax (Rate) so as to implement recommendations made by GST Council in its 45th meeting held on 17.09.2021.

31. 06/2021 - dated 30-9-2021 - UTGST Rate

Seeks to amend notification No. 11/2017- Union Territory Tax (Rate) so as to notify CGST rates of various services as recommended by GST Council in its 45th meeting held on 17.09.2021.

Circulars / Instructions / Orders

Customs

1. 22/2021 - dated 30-9-2021

Rebate of State and Central Taxes and Levies (RoSCTL) Scheme on export of apparel/garments/made-ups w.e.f. 01.01.2021

2. 23/2021 - dated 30-9-2021

Scheme for Remission of Duties and Taxes on Exported Products ( RoDTEP) w.e.f. 01.01.2021.

Highlights / Catch Notes

GST

• GST on Bio-Fertilizers: 5% Rate for Phosphate Solubilising and Potassium Mobilising Products Under Customs Tariff Act, Rule 3(b.

  Case-Laws - AAAR : Classification of goods - HSN Code - Organic manure - Rule 3(b) of the General Rules for the interpretation of Customs Tariff - The two products namely ‘Phosphate Solubilising Bacteria’ and ‘Potassium mobilising Bio-fertilizers’ manufactured and supplied by the appellant are classifiable under Chapter sub-heading No.31059090 of the First Schedule to the Customs Tariff Act, 1975(51 of 1975) and liable to GST at 5% - AAAR
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• Zn EDTA and Fe EDTA classified under tariff heading 3824 due to essential characteristics, lacking specific headings in CTA, 1975.

  Case-Laws - AAAR : Classification of goods - Zn EDTA (Zinc Ethylenediamine Tetra Acetic Acid) - There is no specific heading in the tariff (CTA, 1975) for classification of the ‘Micronutrients’. However, as discussed, as per specifications for the products ‘Zn-EDTA’ and ‘Fe-EDTA’ given in the Fertilizer Control Order, 1985, minimum 12 percent of Zinc is essential in the product ‘Zn-EDTA’ and minimum 12 percent of Iron is essential in the product ‘Fe-EDTA. Thus, the essential character of the product ‘Zn EDTA’ is given by Zinc and essential character of the product ‘Fe EDTA’ is given by Iron. - the product “Zn EDTA” and “Fe EDTA” being supplied by the appellant are classifiable under heading 3824 / Tariff Item 3824 99 90 of the CTA, 1975. - AAAR
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• Goods Classification Ruling: "Papad" Correctly Classified Under HSN Code CTH No. 19059040, Eligible for NIL GST Rate.

  Case-Laws - AAAR : Classification of goods - HSN Code - PAPAD of different shapes and sizes manufactured / supplied by the appellant - the product “different shapes and sizes Papad” is “Papad” of different shapes and size and find specific entry at CTH No. 19059040, therefore as per rule of interpretation, the product is to be classified under CTH No. 19059040 only and not under CTH No. 21069099 of the Customs Tariff Act, 1975 as classified by the GAAR. - Chargeable to NIL rate of GST - AAAR
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• Mixed Flour for Indian Dishes Classified Under Chapter 2106; Attracts 18% GST Per Notification No. 1/2017.

  Case-Laws - AAAR : Classification of goods - Mixed Flour which is used for preparing different traditional Indian dishes - ‘Food preparations not elsewhere specified or included’ falling under Chapter Heading 2106 are covered under the aforesaid Entry at Sr. No. 23 of Schedule- III of Notification No. 1/2017-Central Tax, as amended, attracting Goods and Services Tax @ 18% (CGST 9% + SGST 9%) - AAAR
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• Biomass Boilers and Agro Heaters Not Classified as 'Waste to Energy Plant'; Subject to 18% GST Rate, Rules AAAR.

  Case-Laws - AAAR : Classification of GST - Rate of GST - Biomass Fired (Steam) Boilers - Agro Waste Thermic Fluid Heater - The products do not conform to the description of the ‘Waste to Energy Plant’ - In case the products of the appellant are required in the setting up of the “Waste to Energy Plants”, the same may still fall under aforesaid Entry at Sl. No. 234, however, neither the appellant has claimed so, nor has any evidence been brought on record in this regard. - Liable to GST @18% - AAAR
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• Equipment Hire for Government Events Not Exempt from GST; Not Related to Panchayat/Municipality Functions per Article 243G/W.

  Case-Laws - AAAR : Classification of services - hiring services - Government entity or not - The appellant has provided ‘equipments on hire’ for ‘live videography’ during the events or programmes held by the Government Department for which ‘Hire Charges’ have been paid by the Government Department to the appellant. The activity of ‘providing equipments on hire’ or ‘live videography’ is not an activity in relation to any function entrusted to a Panchayat or a Municipality under Article 243G or Article 243W of the Constitution. - Benefit of exemption is not available - AAAR
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• Nirma University denied GST exemption; fails to qualify as "Governmental Authority" under Notification No. 12/2017-Central Tax criteria.

  Case-Laws - AAAR : Exemption for legal services - Nirma University - Governmental Authority or not - the appellant has not claimed to be satisfying the condition of 90 per cent or more participation by way of equity or control. - the appellant Nirma University cannot be termed as “Governmental Authority” within the definition of the said expression under clause (zf) of para 2 of Notification No. 12/2017-Central Tax. - Benefit of exemption not available - AAAR
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• Bio Agricultural Products 'Rhyzomyx' and 'Rhizomyco' Classified Under Tariff Item 30029030, Subject to 12% GST Rate.

  Case-Laws - AAAR : Classification of bio agricultural products - rate of GST - RhizoMyx - Rhizomyco - The products ‘Rhyzomyx’ and ‘Rhyzomyco’ manufactured and supplied by M/s. Novozymes South Asia pvt.ltd., are classifiable under Tariff item No.30029030 of the First Schedule to the Customs Tariff Act, 1975 - Liable to GST @12% - AAR
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• Assessment Order u/s 73 Invalidated for Violating Natural Justice and Rule 142 CG&ST Rules 2017 Procedures.

  Case-Laws - HC : Validity of assessment order u/s 73 - Violation of principles of natural justice - No personal hearing has been granted - non adherence to Rule 142 had caused prejudice to the writ petitioner qua impugned order - The impugned order is set aside, solely on the ground of non adherence to Rule 142 of the CG&ST Rules, 2017 and all other procedural requirements - HC
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Income Tax

• VSV Act resolves 2015-16 tax dispute; no interest u/s 244A on excess payments towards disputed taxes.

  Case-Laws - HC : Direct Tax Vivad se Vishwas Act - VSV Act - settlement of the dispute of petitioner for assessment year 2015-16 without withdrawing the interest already granted under Section 244A - the reference in which the restriction of interest under section 244A of the Act is made is towards any excess payment of tax in respect of the tax arrears which is the disputed tax - VSV Act clearly envisages that no interest under section 244A of the Act is payable on the amount of tax paid towards the disputed tax which is in excess of the amount determined payable as per Section 3 of the VSV Act. - HC
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• Assessee qualifies for Section 54F deduction despite delayed property acquisition due to builder's fault; Rs. 80 lakhs eligible.

  Case-Laws - AT : Exemption u/s. 54F - The fact that the assessee got the property only in 2018 is due to reasons beyond the control of the assessee, which has been narrated in the earlier paragraphs. Hence the assessee should not suffer for the delinquency of the builder and accordingly we are of the view that the assessee should be granted deduction u/s 54F of the Act for the amount of ₹ 80 lakhs given to the builder within the prescribed time, subject to fulfillment of other conditions. - AT
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• Tax Deduction Error on Interest from FDRs and KDRs u/s 194A: CBDT Clarifies TDS on Actual Credit Only.

  Case-Laws - AT : TDS u/s 194A - Short deduction of tax /default in tax deduction on interest paid on FDR’s/KDR’s - the CBDT had clarified that on account of the Core Branch Banking Solution (CBS) Software wherein for monitoring purposes alone interest is calculated on daily or monthly basis and is swept and kept in provisioning account, TDS is not to be deducted at this point but at the time of giving actual credit to the depositors. CIT(A) found that the assessee was unable to establish that it was covered by the said circular - no reason to interfere with the order of the Ld.CIT(A). - AT
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• CIT Challenges Assessment: Section 263 Revision on Unexplained Cash Credit u/s 68 May Affect Revenue Interests.

  Case-Laws - AT : Revision u/s 263 by CIT - Addition of unexplained cash credit u/s 68 - AO has deemed it fit and proper to treat the cash deposits as the business receipts of the assessee and to estimate the income thereon at 12%. Therefore, it cannot be said that the assessment order u/s 143(3) r.w.s. 263 dated 27.10.2014 is erroneous. By not bringing to tax the entire cash deposits u/s 68 of the Act, the assessment order may be said to have been prejudicial to the interest of the Revenue. But, for a valid revision, both the conditions i.e. the assessment order being erroneous and also being prejudicial to the interest of the Revenue are to be satisfied. - AT
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Customs

• Court Rules Customs Officer Can't Retain 53 Carpets; Violates Section 110(2) Provisions on Goods Retention.

  Case-Laws - HC : Seeking provisional release of goods - Withholding the clearance of the petitioners’ silk fabrics, woollen and silk carpets etc. covered under various shipping bills - The proper officer did not have any authority to retain the 53 carpets contrary to what has been provided for in sub-section (2) of Section 110. - HC
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Indian Laws

• Complaint Filed Too Early: Court Acquits Petitioner in Cheque Dishonor Case Due to Premature Filing Before 15-Day Notice Period.

  Case-Laws - HC : Dishonor of cheque - pre-mature filing of complaint before expiry of the statutory period 15 days from the date of deemed service of the demand notice -This Court is of the considered view that both the learned courts below have erred in holding that the Complaint was maintainable - The petitioner is acquitted on the ground that the complaint itself was pre-mature and consequently, he is discharged from the liability of his bail bond - HC
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• High Court rules that accused in non-bailable offenses should get anticipatory bail if not arrested during investigation.

  Case-Laws - SC : Seeking grant of anticipatory bail - The general principles Under Section 170 Code of Criminal Procedure, the most apposite observations are in sub-para (v) of the High Court judgment in the context of an Accused in a non-bailable offence whose custody was not required during the period of investigation. In such a scenario, it is appropriate that the Accused is released on bail as the circumstances of his having not been arrested during investigation or not being produced in custody is itself sufficient to entitle him to be released on bail. The rationale has been succinctly set out that if a person has been enlarged and free for many years and has not even been arrested during investigation, to suddenly direct his arrest and to be incarcerated merely because charge sheet has been filed would be contrary to the governing principles for grant of bail. We could not agree more with this. - SC
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Case Laws:

• GST

• 2021 (10) TMI 60
  Scope of Advance Ruling - applicability of Section 98 of the CGST Act, 2017 - Classification of goods - rate of CGST and SGST - PAPAD of different shapes and sizes - classified under Chapter Tariff Heading - 1905 of the Customs Tariff Act, 1975 or otherwise? - exemption under Sr. No. 96 under Not. No. 02/2017CT (Rate) dated 28.06.2017 - HELD THAT:- The issue in the present case is not whether the application for advance ruling was ready or otherwise when the proceedings against the appellant were initiated by the DGGI, Surat and whether there was any ulterior motive or mala-fide intention in belatedly filing of such application before the GAAR. It is undisputed fact that the DGGI, Surat conducted search proceeding on 17.02.2020 and recorded a statement of the partner of the appellant on the very same issue in respect of which application was subsequently filed by the appellant before the GAAR on 04.03.2020. Therefore, the application filed by the appellant before the GAAR was covered under the first proviso to sub-section (2) of Section 98 of the CGST Act, 2017. The GAAR as well as this authority are the creature of the statute and are required to act and exercise the powers conferred in accordance with the provisions of the law. Once it is clear that the application of the appellant could not be admitted in view of the provisions of first proviso to sub-section (2) of section 98 of the CGST Act, 2017, neither the GAAR nor this authority has any discretion to allow such application - it is evident that the appellant has not informed the aforesaid material facts to the GAAR at any given point of time thereby willfully suppressing the fact from the Authority and obtaining the Ruling by suppressing the facts. Section 104 of the CGST Act, 2017 stipulates that any Ruling obtained by the applicant under Section 98(4) of the CGST Act, 2017 by fraud or suppression of material facts or misrepresentation of facts may be declared void ab-initio. The appellant has obtained the Advance Ruling by submitting application of advance ruling with suppression of material facts or misrepresentation of facts, and the application was not eligible to be admitted in view of proviso to sub-section (2) of section 98 of the CGST Act, 2017. Therefore, in terms of Section 104 of the CGST Act, 2017, and the GGST Act, 2017, the advance ruling pronounced by the Gujarat Authority of Advance Ruling is liable to be declared as void ab-initio.

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• 2021 (10) TMI 59
  Classification of goods - HSN Code - Organic manure - classified under Chapter subheading No.31059090 on which GST liability was 5% or otherwise - Bio-fertilizers - classified under Chapter sub-heading No.30029030 on which GST liability was 12% or otherwise - Nitrogeneous mixture fertilizers - classified under Chapter sub-heading No.31029090 on which GST liability was 5% or otherwise? - Mixture of fertilizers - classified under Chapter sub-heading No.31059090 on which GST liability was 5% or otherwise? - HELD THAT:- From the submission of the appellant, especially the composition of the inputs contained in their products i.e. Bio-fertilizers and comparing the same to the definitions of Bio-fertilizers , it does not appear to meet the criteria of bio-fertilizer particularly because Organic manure (main source of which is animal waste) is a major input constituting 50% of the mixture whereas Bio culture contained therein is only 2%. Further, the appellant themselves have submitted that they are presently manufacturing only two types of Bio-fertilizers namely Phosphate Solubilising Bacteria and Potassium mobilising Bio-fertilizers. Hence, it can be presumed that the composition of inputs submitted by them pertains to these two products only and therefore the classification to be decided is in respect of these two products only - in the instant case, the two products i.e. Phosphate Solubilising Bacteria and Potassium mobilising Bio-fertilizers contains a mixture of various inputs in which Organic manure is the main input since it constitutes 50% of the final product. Since the two products i.e. Phosphate Solubilising Bacteria and Potassium mobilising Bio-fertilizers contains a mixture of various inputs, reference will be required to be made to Rule 3(b) of the General Rules for the interpretation of Customs Tariff, in order to sort out the matter. As per Rule 3(b), mixtures, composite goods consisting of different materials or made up of different components, and goods put up in sets for retail sale, which cannot be classified by reference to (a), shall be classified as if they consisted of the material or component which gives them their essential character, in so far as the criterion is applicable. Since the two products are mixtures that constitute of 50% organic manures, it can be construed that organic manure is the main component in the mixture and therefore, it is Organic manure which gives the mixture it s essential character - in light of Rule 3(b) of the General Rules for the interpretation of Customs Tariff, the products of the appellant would be rightly classifiable under the Chapter Sub-heading applicable to Organic manure only. The appellant has accepted the classification of their product Organic manure as given in the impugned order of Advance Ruling. Hence it can be concluded that the two products namely Phosphate Solubilising Bacteria and Potassium mobilising Bio-fertilizers manufactured and supplied by the appellant are classifiable under Chapter subheading No.31059090 of the First Schedule to the Customs Tariff Act, 1975(51 of 1975) and liable to GST at 5% in terms of Sl.No.182D of Schedule-I of Notification No.01/2017-Central Tax(Rate) dated 28.06.2017 (as amended from time to time). The two products namely Phosphate Solubilising Bacteria and Potassium mobilising Bio-fertilizers manufactured and supplied by the appellant M/s. G.B. Agro Industries, Bharuch are classifiable under Chapter sub-heading No.31059090 of the First Schedule to the Customs Tariff Act, 1975(51 of 1975) and liable to GST at 5% in terms of Sl.No.182D of Schedule-I of Notification No.01/2017-Central Tax(Rate) dated 28.06.2017 - the classification of the products is entirely based on the composition of inputs as given by the appellant and any alteration/change in the composition of the inputs would also result in alteration of the classification of the aforementioned products.

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• 2021 (10) TMI 58
  Classification of goods - HSN Code - applicable rate of GST - PAPAD of different shapes and sizes - pending proceedings before the DGGI Surat - scope of Advance ruling application - section 98 of the CGST Act, 2017 - HELD THAT:- It appears that had the fact of pending proceedings before the DGGI Surat in applicant s own case relating to questions raised in the application filed before the GAAR been brought to the notice of the GAAR, the application for advance ruling would not have been admitted in view of the proviso to sub-section (2) of section 98 of the CGST Act, 2017 and the question of issuing advance ruling would not have arisen. However, the appellant have not informed the aforesaid material facts to the GAAR at any given point of time thereby willfully suppressing the fact from the Authority and obtaining the Ruling by suppressing the facts. Section 104 of CGST Act, 2017 stipulates that any Ruling obtained by the applicant under Section 98(4) of the CGST Act, 2017 by fraud or suppression of material facts or misrepresentation of facts , may be declared void ab-initio. The appellant has obtained the Advance Ruling by submitting application of advance ruling with suppression of material facts or misrepresentation of facts, and the application was not eligible to be admitted in view of proviso to sub-section (2) of section 98 of the CGST Act, 2017. Therefore, in terms of Section 104 of CGST Act, 2017, and the GGST Act, 2017, the advance ruling pronounced by the Gujarat Authority of Advance Ruling is liable to be declared as void ab-initio.

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• 2021 (10) TMI 57
  Classification of goods - Zn EDTA (Zinc Ethylenediamine Tetra Acetic Acid) - Fe EDTA (Iron Ethylenediamine Tetra Acetic Acid) - classifiable under Chapter Heading 2833, 2921, 3105 or 3808 or any other Chapter Heading of the Customs Tariff Act, 1962? - applicability of S. No. 182D of Schedule I, S. No. 56 of Schedule II, S. No. 40, 45 or 87 of Schedule-III, or any other S. No. of any of the Schedules of Notification No. 1/2017-Central Tax (Rate) dated 28.06.2017 (as amended) and corresponding Notification No. 1/2017-State Tax (Rate) dated 30.06.2017 (as amended) and Notification No. 1/2017-Integrated Tax (Rate) dated 28.06.2017 (as amended) - whether the supply of products by the applicant to the recipient, who is not registered under the Fertilizer Control Order, 1985, will have any impact on the applicability of particular S. No. of Schedule of Notification No. 1/2017-Central Tax (Rate) dated 28.06.2017 (as amended) and corresponding Notification No. 1/2017-State Tax (Rate) dated 30.06.2017 (as amended) and Notification No. 1/2017-Integrated Tax (Rate) dated 28.06.2017 (as amended)? HELD THAT:- It is evident from the specifications for the products Zn-EDTA and Fe-EDTA given in the Fertilizer Control Order, 1985 that minimum percentage of Zinc is essential in the product Zn-EDTA and minimum percentage of Iron is essential in the product Fe-EDTA , besides some other requirements. However, in the specifications of these products given in the Fertilizer Control Order, 1985, no requirement of any of the fertilizing elements nitrogen, phosphorus or potassium has been mentioned. Therefore, it cannot be said that the products Zn-EDTA and Fe-EDTA contain at least one of the fertilizing elements nitrogen, phosphorus or potassium as an essential constituent , which is one of the prime requirements as per Chapter Note 6 of Chapter 31 of the CTA, 1975 to term a product as other fertilizer classifiable under heading 3105 of the CTA, 1975. The products Zn EDTA and Fe EDTA are covered under serial no. 1(g) of Part-A Schedule-I of the Fertilizer Control Order, 1985, which is for Micronutrients . As per the Explanatory Note of Chapter 31, even if the micronutrient preparations contain small amounts of fertilizing elements nitrogen, phosphorus and potassium, but not as essential constituents, the said products are excluded from Chapter 31 - the products Zn EDTA and Fe EDTA do not contain fertilizing elements nitrogen, phosphorus and potassium as an essential constituent. Thus, in view of the Chapter Note 6 of Chapter 31 of the CTA, 1975 and the Explanatory note of Chapter 31, it is held that the products Zn EDTA and Fe EDTA do not fall under Chapter heading 3105 of the CTA, 1975 as other fertilizer - the product Zn EDTA and Fe EDTA being supplied by the appellant are classifiable under heading 3824 / Tariff Item 3824 99 90 of the CTA, 1975. Applicable rate of GST - HELD THAT:- It is observed that Serial no. 1(g) of Part-A Schedule-I of the Fertilizer Control Order, 1985 covers different Micronutrients . As already discussed, the products Zn EDTA and Fe EDTA being supplied by the appellant are covered at entry 7 and 8 respectively of serial no. 1(g) of Part-A Schedule-I of the Fertilizer Control Order, 1985. Further, the appellant has submitted that it is a manufacturer of the said products for which it is registered by the Deputy Director of Agriculture (Extension), District Mehsana, Gujarat under the Fertilizer Control Order, 1985 - the products Zn EDTA and Fe EDTA being supplied by the appellant are covered under Sl. No. 56 of Schedule-II of Notification No. 1/2017-Central Tax (Rate) dated 28.06.2017, as amended (and corresponding Notification issued under the GGST Act, 2017) attracting Goods and Services Tax @ 12%.

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• 2021 (10) TMI 56
  Classification of goods - HSN Code - PAPAD of different shapes and sizes manufactured / supplied by the appellant - merit classification under CTH No. 1905 of Custom Tariff Act, 1975 or otherwise? - HELD THAT:- Traditionally PAPAD is round shaped but the PAPAD is ready to cook product and can be consumed after roasting or frying in oil and consumed as snacks with the Indian meal or soup. Similarly, the product in question of different shape and size is a ready to cook product and can be consumed after roasting or frying in oil and consumed as snack. Further cereal flour of Chapter 10 and 11 of Customs Tariff Act, 1975 are the ingredients of both the product. Both the products i.e. PAPAD and product in question are same except they are known by different name in general public i.e. as PAPAD and Fryums . The manufacturing process of the products under consideration has been submitted by the appellant. It has been submitted that ingredients are mixed in machine with water and oil, dough is prepared and passed through die of different shapes and size to manufacture different shapes and size of papad and then dried through various stages. The product of the appellant, thus prepared, is thin and wafer like product. At this stage, the product is not ready for consumption. Though, traditionally Papad has been prepared manually, in round shape. However, when ingredients and process are similar in case of PAPAD and impugned product, then the product in question is nothing but a kind of PAPAD irrespective of their shape and sizes. The products of the appellant has found its use as an alternative to regular round shaped Papad or as an additional variety of Papad in the Indian meal, especially the meals served during the community functions. The caterers, who prepare the meals for the community functions, as well as the people in general, consider such products as a different type or variety of Papad only - the applicant s products of different shapes and sizes of papad, whose pictures are reproduced above, are nothing but Papad, classifiable under Tariff Item 1905 90 40 of the Customs Tariff Act, 1975. CTH No. 2106 of Customs Tariff Act, 1975 covers the Food preparations not elsewhere specified or included means under this heading all types of foods preparation are covered which are not covered under the specific heading of tariff. It is important to refer to Chapter Notes of Heading #21 wherein under clause 5 (b) it is stated that Heading 2106 includes preparations for use, either directly or after processing (such as cooking, dissolving or boiling in water, milk or other liquids), for human consumption and under clause 6 it has been stated that Tariff item 2106 90 99 includes sweet meats commonly known as Misthans or Mithai or called by any other name - in the case at hand, the product different shapes and sizes Papad is Papad of different shapes and size and find specific entry at CTH No. 19059040, therefore as per rule of interpretation, the product is to be classified under CTH No. 19059040 only and not under CTH No. 21069099 of the Customs Tariff Act, 1975 as classified by the GAAR. The product different shapes and sizes Papad involved in the present case merit classification under Tariff heading No. 19059040 of the Customs Tariff Act, 1975 - the product in question is classifiable under CTH No. 1905 of the Customs Tariff Act, 1975, the said CTH No. 1905 is covered under entry No. 96 of Notification No. 02/20178-CT (Rate) dated 28.06.2017 and accordingly chargeable to NIL rate of Goods and Services Tax.

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• 2021 (10) TMI 55
  Classification of goods - HSN Code - PAPAD of different shapes and sizes manufactured / supplied by the appellant - merit classification under CTH No. 1905 of Custom Tariff Act, 1975 or otherwise? - HELD THAT:- Traditionally PAPAD is round shaped but the PAPAD is ready to cook product and can be consumed after roasting or frying in oil and consumed as snacks with the Indian meal or soup. Similarly, the product in question of different shape and size is a ready to cook product and can be consumed after roasting or frying in oil and consumed as snack. Further cereal flour of Chapter 10 and 11 of Customs Tariff Act, 1975 are the ingredients of both the product. Both the products i.e. PAPAD and product in question are same except they are known by different name in general public i.e. as PAPAD and Fryums . The manufacturing process of the products under consideration has been submitted by the appellant. It has been submitted that ingredients are mixed in machine with water and oil, dough is prepared and passed through die of different shapes and size to manufacture different shapes and size of papad and then dried through various stages. The product of the appellant, thus prepared, is thin and wafer like product. At this stage, the product is not ready for consumption. Though, traditionally Papad has been prepared manually, in round shape. However, when ingredients and process are similar in case of PAPAD and impugned product, then the product in question is nothing but a kind of PAPAD irrespective of their shape and sizes. The products of the appellant has found its use as an alternative to regular round shaped Papad or as an additional variety of Papad in the Indian meal, especially the meals served during the community functions. The caterers, who prepare the meals for the community functions, as well as the people in general, consider such products as a different type or variety of Papad only - the applicant s products of different shapes and sizes of papad, whose pictures are reproduced above, are nothing but Papad, classifiable under Tariff Item 1905 90 40 of the Customs Tariff Act, 1975. CTH No. 2106 of Customs Tariff Act, 1975 covers the Food preparations not elsewhere specified or included means under this heading all types of foods preparation are covered which are not covered under the specific heading of tariff. It is important to refer to Chapter Notes of Heading #21 wherein under clause 5 (b) it is stated that Heading 2106 includes preparations for use, either directly or after processing (such as cooking, dissolving or boiling in water, milk or other liquids), for human consumption and under clause 6 it has been stated that Tariff item 2106 90 99 includes sweet meats commonly known as Misthans or Mithai or called by any other name - in the case at hand, the product different shapes and sizes Papad is Papad of different shapes and size and find specific entry at CTH No. 19059040, therefore as per rule of interpretation, the product is to be classified under CTH No. 19059040 only and not under CTH No. 21069099 of the Customs Tariff Act, 1975 as classified by the GAAR. The product different shapes and sizes Papad involved in the present case merit classification under Tariff heading No. 19059040 of the Customs Tariff Act, 1975 - the product in question is classifiable under CTH No. 1905 of the Customs Tariff Act, 1975, the said CTH No. 1905 is covered under entry No. 96 of Notification No. 02/20178-CT (Rate) dated 28.06.2017 and accordingly chargeable to NIL rate of Goods and Services Tax.

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• 2021 (10) TMI 54
  Classification of goods - Mixed Flour which is used for preparing different traditional Indian dishes - classified under Tariff Item 1106 vide Entry No.59 of Schedule-I of Notification No.01/2017-Central Tax (Rate) dated 28.06.2017 and Notification No.01/2017-State Tax (Rate) dated 30.06.2017, Notification No.01/2017-Integrated Tax (Rate) dated 28.06.2017 or otherwise - HELD THAT:- The products of the applicant, including Upma Mix Flour, RavaIdli Mix Flour, Muthiya Mix Flour and Khichu Mix Flour, are not classifiable under Chapter 11 of the CTA, 1975.Therefore, the view of the GAAR to initially classify these products under Chapter Heading 11.01 and 11.02 of the CTA, 1975 and thereafter holding these products as classifiable under Chapter Heading 23.02 of the CTA, 1975 on the ground of non-furnishing of details of Starch Content, Ash Content, Rate of passage through a sieve in respect of these products, does not appear proper - Even otherwise, classifying the products Upma Mix Flour, RavaIdli Mix Flour, Muthiya Mix Flour and Khichu Mix Flour under Chapter Heading 23.02 of the CTA, 1975 does not appear correct. Chapter Heading 23.02 of the CTA, 1975 covers Bran, sharps and other residues, whether or not in the form of pellets, derived from the sifting, milling or other working of cereals or of leguminous plants . Thus, it is evident that the Chapter Heading 23.02 covers Bran, sharps and other residues of cereals or of leguminous plants whereas the products Upma Mix Flour, RavaIdli Mix Flour, Muthiya Mix Flour and Khichu Mix Flour cannot be said to be containing bran, sharps and other residues of cereals or of leguminous plants - the products Upma Mix Flour, RavaIdli Mix Flour, Muthiya Mix Flour and Khichu Mix Flour are not classifiable under Chapter Heading 23.02 of the CTA, 1975. Chapter Heading 21.06 and specifically Tariff Item 2106 90 99 is not confined to processed or semi processed food, cooked or semi cooked food, preserved food and ready to eat food. In fact, any product which is a food preparation and which is not elsewhere specified or included in the CTA, 1975, gets covered under Chapter Heading 21.06 of the CTA, 1975. Therefore, merely because the end consumer of the Instant Mix Flour is required to follow certain food preparation processes before such product(s) can be consumed, is no ground to take these products out of Chapter Heading 21.06 of the CTA, 1975 - it is pertinent to note that for the purpose of Goods and Services Tax, classification as per CTA, 1975 has been adopted, which in turn is based on the Harmonised System of Nomenclature, which was not the case with the Schedule-I of the Gujarat Value Added Tax Act, 2003. Therefore, the Determination Orders issued under the Gujarat VAT Act, 2003 are not applicable in the present case. Various Instant Mix Flour / Ready Mix Flour of the applicant are classifiable under Chapter Heading 21.06 and Tariff Item 2106 90 99 of the CTA, 1975 - Food preparations not elsewhere specified or included falling under Chapter Heading 2106 are covered under the aforesaid Entry at Sr. No. 23 of Schedule- III of Notification No. 1/2017-Central Tax, as amended, attracting Goods and Services Tax @ 18%, though some of the specific products of Chapter Heading 2106 excluded from this entry are covered under different entries of Schedule-I or Schedule-II, attracting Goods and Services Tax @ 5% or 12%.

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• 2021 (10) TMI 53
  Classification of GST - Rate of GST - Biomass Fired (Steam) Boilers - Agro Waste Thermic Fluid Heater - applicability of Sl. No. 234 of Schedule I to Notification No. 01/2017- Central Tax (Rate) dated 28.06.2017 - HELD THAT:- The phrase Waste to Energy Plants denotes a particular meaning. The said phrase refers to the plants for recovery of energy in the form of Biogas / BioCNG / Electricity from agricultural, industrial and urban wastes of renewable nature such as municipal solid wastes (MSW), vegetable and other market wastes, etc. Therefore, the approach of referring to the dictionary meaning of each of the terms Waste , Energy and Plant separately, as suggested by the appellant, would not be correct approach to understand the true meaning of the phrase Waste to energy plants / devices used at clause (e) of Entry at Sl. No. 234 of Schedule I of Notification No. 1/2017-Central Tax (Rate) - the products Biomas Fired (Steam) Boilers, Agro Waste Thermic Fluid Heater of the appellant are admittedly not Waste to Energy Plants in the aforesaid sense of the said phrase used in the Notification No. 1/2017-Central Tax (Rate). The products Biomas Fired (Steam) Boilers, Agro Waste Thermic Fluid Heater of the appellant in itself do not conform to the above description of the Waste to Energy Plant submitted by the appellant inasmuch as the steam boiler is stated to be a power generation device, used for generating steam by applying the heat energy to water whereas it is stated that the coil heats the thermal oil or fluid that is pumped through the thermal oil boiler and the thermal oil heats coil in various types of heat users - In case the products of the appellant are required in the setting up of the Waste to Energy Plants , the same may still fall under aforesaid Entry at Sl. No. 234, however, neither the appellant has claimed so, nor has any evidence been brought on record in this regard. The products Biomass Fired (Steam) Boilers, Agro Waste Thermic Fluid Heater of M/s. Isotex Corporation Pvt. Ltd. are not covered under Entry at Sl. No. 234 of Schedule I of Notification No. 1/2017-Central Tax (Rate) dated 28.06.2017 and Notification No. 1/2017-State Tax (Rate) dated 30.06.2017 but are covered under Entry at Sl. No. 310 of Schedule III of Notification No. 1/2017-Central Tax (Rate) dated 28.06.2017 and Notification No. 1/2017-State Tax (Rate) dated 30.06.2017 attracting Goods and Services Tax @ 18% - Appeal rejected.

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• 2021 (10) TMI 52
  Classification of services - hiring services - Government entity or not - scope of clause 5 (f) of the Schedule II to the Central Goods and Services Tax Act, 2017 - Service related to collection of Hire Charges for temporary transfer of right to use goods - activity in relation to any function entrusted to a Panchayat under Article 243-G of the Constitution or in relation to any function entrusted to a Municipality under Article 243-W of the Constitution - exemption under the scope of Sr. No. 3 of the Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017. HELD THAT:- It appears from the nature of activities described by the appellant that the appellant is required to temporarily deploy various equipments at specified places to provide live videography of the events organized by the department of the State Government or by a Government Entity. Thus, it cannot be said that the appellant is supplying goods to the State Government or to a Government Entity. In fact, what emerges from the submissions of the appellant is that the appellant is required to temporarily deploy various goods in order to supply the service of live videography to the department of the State Government or Government Entity. The use of required goods and equipments by the appellant in order to provide service of live videography to the Government of Gujarat and Government Entity would not change the nature of service from pure service to supply of service with goods - exemption under Sl. No. 3 of Notification No. 12/2017-Central Tax (Rate) is admissible when Pure Services is provided to the Central Government, State Government or Union Territory or local authority or a Governmental authority or a Government Entity. Whether the service of providing equipments on hire for live videography of the appellant can be termed to be services by way of any activity in relation to any function entrusted to a Panchayat or a Municipality under Article 243G or Article 243W of the Constitution, rather than the nature of events or programmes held by the Government? - HELD THAT:- The appellant has provided equipments on hire for live videography during the events or programmes held by the Government Department for which Hire Charges have been paid by the Government Department to the appellant. The activity of providing equipments on hire or live videography is not an activity in relation to any function entrusted to a Panchayat or a Municipality under Article 243G or Article 243W of the Constitution - The service of providing equipments on hire for live videography does not have any direct and proximate relationship with any of the activities listed in Article 243G or Article 243W read with Eleventh Schedule and Twelfth Schedule of the Constitution of India. The exemption provided vide Sl. No. 3 of Notification No. 12/2017-Central Tax (Rate) is not admissible to the appellant for providing service of equipment on hire for live videography to the State Government - the services being provided by the appellant Ms. Jayshreeben Rameshchandra Kothari are not covered under Sl. No. 3 of Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017, as amended and Notification No. 12/2017-State Tax (Rate) dated 30.06.2017, as amended. Appeal dismissed.

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• 2021 (10) TMI 51
  Exemption for legal services - Nirma University - Governmental Authority or not - exemption under Sr.No. 45 of the Notification No. 12/2017- Central Tax(Rate) dated 28th June, 2017 or under Sr.No.4 of Notification No. 12/2017- Central Tax (Rate) - requirement to be registered as a Deductor under GST as per the provision of Section 24 of the CGST Act or not - HELD THAT:- The condition mentioned in item (ii) of clause (zf) of para 2 of the Notification No. 12/2017-Central Tax (Rate) are applicable to both the items (i) and (ii) of the said clause - the condition that an authority / board / other body, to be qualified as Governmental Authority should have been set up or established with 90 per cent, or more participation by way of equity or control, to carry out any function entrusted to a municipality under article 243W of the Constitution or to a Panchayat under article 243G of the Constitution , is applicable to both the items (i) and (ii) of definition of Governmental Authority at clause (zf) of para 2 of Notification No. 12/2017-Central Tax. The appellant has been set up under the Nirma University Act, i.e. an Act of the Gujarat Legislature, therefore it falls under item (i) of the definition of Governmental Authority . However, the appellant has not claimed to be satisfying the condition of 90 per cent or more participation by way of equity or control. The Nirma University Act contains provisions relating to Funds of University in section 24 and provisions relating to composition of Board of Governors in section 10, which also do not indicate that the appellant is satisfying the condition 90 per cent or more participation by way of equity or control - thus, the appellant Nirma University cannot be termed as Governmental Authority within the definition of the said expression under clause (zf) of para 2 of Notification No. 12/2017-Central Tax. Nirma University is not eligible for claiming benefit of Sr. No. 45 of Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017, as amended and Notification No. 12/2017-State Tax (Rate) dated 30.06.2017, as amended - Services provided by Nirma University are not exempted under Sr. No. 4 of Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017, as amended and Notification No. 12/2017-State Tax (Rate) dated 30.06.2017, as amended.

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• 2021 (10) TMI 50
  Classification of bio agricultural products - rate of GST - RhizoMyx - Rhizomyco - classifiable under Chapter 3101 or under Chapter 3002 of CETA - HELD THAT:- Taking into consideration the fact that no chemicals are contained in the aforementioned products and there is the presence of endomycorrhiza and ectomycorrhiza (which are microorganisms), it can be seen that the said products manufactured and supplied by the appellant are biofertilisers. Since the definition of vegetable fertilisers is not available anywhere, hence it would have to be construed in generic terms. In generic terms, vegetable fertilisers would be the fertilizers derived from vegetable matter like compost and crop residues - Vikaspedia defines biofertilisers as under: In nature, there are a number of useful soil micro organisms which can help plants to absorb nutrients. Their utility can be enhanced with human intervention by selecting efficient organisms, culturing them and adding them to soil directly or through seeds. The cultured micro organisms packed in some carrier material for easy application in the field are called bio-fertilisers. Thus the critical input in Biofertilisers is the microorganisms. On comparing the definition as well as the uses of Biofertilizers vis-a-vis Animal fertilier/organic fertilizer/vegetable fertilizer, it can be seen that Biofertilsers are completely distinct in nature and use to these fertilisers. In view of these facts, we conclude that biofertilisers are not covered under the Sub-heading 3101 of the First Schedule to the Customs Tariff Act, 1975(15 of 1975) - the entire portion of the description of goods except cultures of micro-organisms (excluding yeasts) pertains to the medical field. On going through the said Subheading 3002, it is seen that cultures of micro-organisms (excluding yeasts) appears at Tariff entry No.30029030 of the First Schedule of the Customs Tariff Act, 1975 (51 of 1975). Looking to the process of manufacture/production of biofertilizers, their uses, the specific subheadings covered under the above heading as well as the explanatory notes to HSN of the above heading, it can be concluded that the biofertilizers namely Rhyxomyx and Rhyxomyco manufactured and supplied by the appellant are classifiable under Tariff item No.30029030 of the First Schedule to the Customs Tariff Act, 1975 (51 of 1975), is covered under Sr.no.61 of Schedule-II of Notification No.01/2017-Central Tax(Rate) dated 28.06.2017(as amended from time to time ) and is liable to GST at 12%. As per Rule 3(a), it is found that where goods are, prima facie, classifiable under two or more headings, the heading which provides the most specific description shall be preferred to headings providing a more general description. The appellant has not given any specific grounds other than the reference to the aforementioned judgement to support their contention that their products are classifiable under Heading 3101. However, we find that Sub-heading 3002 provides the most specific description to the biofertilisers manufactured and supplied by the appellant. The products Rhyzomyx and Rhyzomyco manufactured and supplied by M/s. Novozymes South Asia pvt.ltd., are classifiable under Tariff item No.30029030 of the First Schedule to the Customs Tariff Act, 1975 (51 of 1975), is covered under Sr.no.61 of Schedule-II of Notification No.01/2017-Central Tax (Rate) dated 28.06.2017(as amended from time to time ) and is liable to GST at 12% - appeal dismissed.

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• 2021 (10) TMI 47
  Validity of adjudication order - Section 74 of the U.P. GST Act, 2017 - Valididty of two SCN - SCN dated 09.04.2021 for the period July 2017 to March 2018 under Section 127 of the UP GST Act, 2017 - SCN dated 23.12.2020 for the period July 2017 to March 2018 under Section 74 (3) of the Act - HELD THAT:- The written instructions placed on record by the learned Standing Counsel reveal that with respect to the proceedings under Section 127 of the Act, no prior adjudication exists. The petitioner has also filed a written reply dated 17.04.2021. Accordingly, leaving all courses open to the petitioner to raise objections in those proceedings, interference with the notice dated 09.04.2021 is also declined. SCN dated 23.12.2020 for the period July 2017 to March 2018 - HELD THAT:- Learned Standing Counsel clearly states that apparently that notice has been issued mistakenly, inasmuch earlier notice had been issued for the period July 2017 and the dispute for that period stood adjudicated by the earlier order dated 29.05.2020. The State therefore prays and is granted liberty to withdraw the aforesaid notice dated 23.12.2020, leaving it open the appropriate authority to issue such further notice as may be in accordance with law, for the period August 2017 to March 2018. The writ petition is disposed of leaving it open to the petitioner to file appeal, as above before the appropriate forum. In view of the present circumstances, that appeal, if filed within a period of two weeks from today, the same may be decided on merits, as expeditiously as possible.

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• 2021 (10) TMI 44
  Validity of correction of tax - refund of tax - self assessment of tax under Section 74(5) of the CGST Act cannot also have a remedy under Section 107 of the GST Act - HELD THAT:- Issue Notice returnable on 08.10.2021. Direct service qua respondent no.2 is permitted.

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• 2021 (10) TMI 43
  Vires of Explanation I (ii) to Section 74 of the CGST Act, 2017 and Delhi GST Act, 2017 - proceedings against all the persons liable to pay penalty under Sections 122, 125, 129 and 130 of CGST Act - HELD THAT:- Issue notice - List on 24th March, 2022.

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• 2021 (10) TMI 42
  Seeking provisional release of the goods and vehicle - Section 67(6) of the Central / Gujarat Goods and Service Tax Acts - goods detained on the ground that the e-way bill was not available with the driver - HELD THAT:- The chronological events are noticed, more particularly the date of order of detention of the truck with the goods on 07.09.2021 in the Form of GST MOV 10. They have come on record. The communication to the concerned authority by the petitioner on 16.09.2021 raises both the issues. The petitioner herein is the owner of the goods and it is his case that his vehicle and goods both have been seized by the GST Authorities and when the goods were being transported in the alleged contravention of the Act and the Rules, order is passed of detention under the GST MOV 10 and as the matter is at the stage of GST MOV 10, this Court would not like to enter into the merits of the matter - The application preferred by the petitioner shall need to be considered by the authority for this being the goods in transit on applying the provisions of section 67(6) of the Act. Request shall be made by the petitioner to consider such provisional release on 24.09.2021 or on any other scheduled date. Let a speaking order be passed by the authority / officer concerned in this regard on the issue of provisional release to enable the petitioner to take necessary legal course if in case there arises any need for challenge - petition disposed off.

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• 2021 (10) TMI 37
  Scope of the tender / Financial Bid - Non-submission of GST registration certificate - entity involved in the business of Healthcare Services - exemption under N/N. 9/2017-Integrated Tax (Rate), dated 28.06.2017 - Rejection of technical bid - HELD THAT:- It is true that the writ petitions filed against the State or its instrumentalities in relation to contractual matters are maintainable. However, that general proposition has certain limitations. The Court exercising jurisdiction under Article 226 would have to consider the factors, enumerated above, among others, on a case to case basis, before exercising its discretion to hear a writ Petition, relating to contractual disputes, under Article 226 of the Constitution of India - Applying the above principles to the present case, the Petitioner has not been able to make out any case of discrimination or bias against the Respondents. The only ground that could be raised by the petitioner is that of an arbitrary action of the 2nd Respondent, in rejecting the bid of the Petitioner and allowing the Respondents to participate in the financial bids. It would now be necessary to see whether the said allegations hold. Disqualification of the Petitioner - HELD THAT:- A person is exempted from the requirement of registration if he is engaged in supplying only those goods and services which are exempt from registration and does not supply any other goods or services. If such a person deals in any other goods or services, he will not be eligible for such exemption - Sri Chittem Venkata Reddy, the learned counsel appearing for the 2nd respondent submits that the successful tenderer would be required, as per Section IV of the Tender Documents, to supply medicines and other goods, which are not exempted under the GST Act, in the process of maintaining SNCUs, and for that reason the 2nd Respondent had required all bidders to submit GST registration certificates. It is clear that in such a situation, the Petitioner would have to supply drugs and goods which are not exempt from levy of GST and the petitioner would require to be registered, under the GST Act. In the absence of such a registration certificate, the action of the 2nd Respondent in rejecting the technical bid of the Petitioner cannot be termed to be arbitrary. Refusal to reject the technical bid of the 3rd Respondent - HELD THAT:- The petitioner would seek to point out certain provisions where details of the lead member are required and where the lead member has to give certain assurances etc. However, this requirement cannot be taken to mean that the bid document has to be filed only by the lead member. All such information and assurances can always be obtained by any other member and file before the tender authority. As such it cannot be said that the 3rd respondent is disqualified on that count and the action of the 2nd Respondent in allowing the 3rd respondent in participating in the financial bid cannot be termed arbitrary. Permission to participate in the financial bid even though the 4tgh Respondent did not have the necessary experience to qualify in the technical bid - HELD THAT:- The 4th respondent had submitted a certificate from the NRI Academy of Sciences stating that NRI Academy of Sciences through the 4th respondent had provided such services to CHC Seethampeta in ITDA area of Seethampeta, A.P, from March, 2018 to 13.08.2020 and the certificate from the medical officer of the area hospital Seethampeta that such services were being given at CHC Seethampeta in ITDA area of Seethampeta from 14.08.2020 till 29.07.2021. This would show that the 4th respondent has been giving services for more than three years required under the said eligibility criteria. The contention of the petitioner that such services were not in accordance with the contract between M/s. NRI Academy of Sciences and the State of A.P., has not been demonstrated by the petitioner. Except a statement that it is not in accordance with the contract between the parties, the petitioner has not placed any material before this Court to take such a view - The certificates produced by the 4th Respondent do attest to the experience claimed by the 4th respondent. In the circumstances, the contention of the petitioner that the action of the 2nd respondent in this regard is arbitrary must fail. The Writ is dismissed.

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• 2021 (10) TMI 36
  Validity of assessment order u/s 73 - Violation of principles of natural justice - No personal hearing has been granted - procedure for making impugned order not followed - impugned order was not preceded by Forms GST DRC-01 and GST DRC-01A - HELD THAT:- The requirements of issue of FORM GST DRC-01 and FORM GST DRC-01A have been statutorily ingrained in the rules made under the CG ST Act i.e., Rule 142 of the CG ST Rules, 2017. A careful perusal of Section 73 of the CG ST Act in conjunction with Rule 142 makes it clear that non adherence to Rule 142 had caused prejudice to the writ petitioner qua impugned order and therefore it is a rule which necessarily needs to be adhered to,if prejudice is to be eliminated in the case on hand. In other words, it is not a mere procedural requirement but on the facts and circumstances of this case, it becomes clear that it tantamount to trampling the rights of writ petitioner. The impugned order is set aside, solely on the ground of non adherence to Rule 142 of the CG ST Rules, 2017 and all other procedural requirements - As the impugned order is set aside solely on the ground Rule 142 of CG ST Act, 2017, though obvious it is made clear that no view or opinion on the merits of the matter have been expressed in the instant order - petition disposed off.

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• 2021 (10) TMI 32
  Maintainability of appeal - Section 107 of the GST Act, 2017 - appellate order or not - levy of tax and penalty - violation of principles of natural justice - HELD THAT:- It has been observed that the appeal was preferred on 31.01.2020 before the appellate authority, thereafter no one appeared on behalf of the appellant. The appeal of the petitioner has been dismissed without affording any opportunity of being heard to the petitioner. It is deemed appropriate to grant an opportunity to the petitioner to appear before the appellate authority and accordingly direct that the petitioner shall appear before the appellate authority on 29.10.2021 and the appellate authority shall afford an opportunity of hearing to the petitioner and pass a fresh order without being influenced by the order dated 16.03.2020 passed in the appeal. Petition disposed off.

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• Income Tax

• 2021 (10) TMI 46
  Transfer of case u/s 127 - no opportunity of hearing to the petitioner and without recording the reason for not giving opportunity of hearing to the petitioner - HELD THAT:- As in view of the factual and legal position that the impugned order of transfer under Section 127 (2) of the Income Tax Act dated 18th February, 2021 transferring the case of the petitioner was passed without giving opportunity of hearing to the petitioner and without recording the reason for not giving opportunity of hearing to the petitioner before passing such order of transfer of the case of the petitioner under Section 127 (2) of the Income Tax Act, 1961, from Kolkata to Delhi and without considering and disposing the reply/objection to the show-cause notice by the petitioner against the proposed action of transfer of case of the petitioner by the respondent is illegal, invalid and not sustainable in law and the said impugned order of transfer dated 18th July, 2019 under Section 127 (2) of the Income Tax Act, 1961 is accordingly quashed and the respondents concerned are directed to send back the case of the petitioner from Delhi to Kolkata immediately after receipt of communication of this order.

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• 2021 (10) TMI 35
  Deemed dividend addition u/s 2(22)(e) - ITAT deleted the addition - HELD THAT:- In the present case, both the CIT(A) as well as Tribunal have given findings of the fact that the advance received from the company by the assessee was in the nature of trade advanced booking of commercial place being built by the assessee. Both the CIT(A) as well as the Tribunal have further held that in the present case, it was the company which owed money to the assessee rather than the other way round. This his Court is of the view that the said findings should not be lightly interfered with. In fact, the Supreme Court in Hero Vinoth (Minor) vs. Seshammal [ 2006 (5) TMI 478 - SUPREME COURT ] has also held that in a case where from a given set of circumstances two inferences of fact are possible, the one drawn by the lower appellate court will not be interfered by the High Court in second appeal. Adopting any other approach is not permissible. It has also held that there is a difference between question of law and a substantial question of law . Revenue appeal dismissed.

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• 2021 (10) TMI 30
  Direct Tax Vivad se Vishwas Act - VSV Act - settlement of the dispute of petitioner for assessment year 2015-16 without withdrawing the interest already granted under Section 244A - HELD THAT:- Assessee would be entitled to refund but without interest. In the case at hand, interest of Rs. 42,72,210/- paid under Section 244A of the Act was not determined as payable under the VSV Act but was paid as per the assessment order passed for the Assessment Year which was more than 2 1/2 years before the declaration under the VSV Act was filed by petitioner. Therefore, the explanation is not applicable to the case at hand. Petitioner has not asked for interest under Section 244A of the Act on the amount of refund claimed in form no.1. In the explanation to Section 7 of the VSV Act, the term specifically used is any amount paid in respect of tax arrear. The term tax arrear , is defined to mean aggregate amount of disputed tax and the term disputed tax is defined to mean the tax payable by petitioner as if the appeal is decided against petitioner. So, the explanation only refers to the amount paid in respect of tax arrear which is refunded under the VSV Act and not any other refund amount. This implies that the reference in which the restriction of interest under section 244A of the Act is made is towards any excess payment of tax in respect of the tax arrears which is the disputed tax - VSV Act clearly envisages that no interest under section 244A of the Act is payable on the amount of tax paid towards the disputed tax which is in excess of the amount determined payable as per Section 3 of the VSV Act. The amount payable towards disputed tax will only arise post the assessment order is passed. In the case at hand, petitioner has not made any payment post the assessment order, in fact, respondent no.2 has determined a refund to petitioner in the revised assessment order after adjusting all the disputed tax. The refund determined by respondent no.2 in the assessment order is out of tax deducted at source and taxes paid prior to filing of the return of income and not on account of any amount paid towards tax arrear prior to applying under the VSV Act which has resulted in excess payment of the tax arrear (disputed tax) determined as per Section 3 of the VSV Act. The interest on refund that was paid was on the undisputed part of the excess tax paid and not on the disputed tax. In the circumstances, Form - 3 dated 11 th December 2020 issued by respondent No. 1 is hereby set aside. Respondent No. 1 is directed to issue revised Form -3/fresh Form No. 3 in terms of the order mentioned above.

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• 2021 (10) TMI 28
  Validity of assessment u/s 153A - as stated assessment for Assessment Year 2011-12 was completed u/s 153A which is beyond the purview of section 153A/153C of the Act as the date of search was 15.09.2009 - curable defect u/s 292B - HELD THAT:- From the assessment order, it is clear that same has been framed u/s 153A r.w.s 143(3) of the Act. It is also evident from the assessment order that it speaks of search and seizure operation was carried out on 15.09.2009. It further states that the assessment order was passed in the prior approval of Ld. Addl. CIT, Central Range, Meerut within the meaning of section 153D of the Act vide F.No. Addl.CIT/CR/MRT/S S/153D2011-12/681 dated 29.12.2011. These facts are not disputed by the Revenue. AO has consciously made assessment u/s 153A of the Act and on the basis of alleged statement recorded during the search. Therefore, it cannot be construed that recordings of such facts is by mistake. Therefore, the impugned assessment order do not satisfy the test of law, the same deserves to be quashed. We, therefore, hereby quash the impugned assessment order. Thus, Ground No.1 raised by the assessee is allowed.

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• 2021 (10) TMI 27
  Income accrued in India - Fix place PE/service PE/ installation PE in India - HELD THAT:- Revenue has not rebutted the observations made in the impugned direction and reaching to the conclusion that the assessee had no PE in India. We, therefore, do not see any reason to interfere in the finding of DRP, the same is hereby affirmed. - Decided against revenue.

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• 2021 (10) TMI 26
  Exemption u/s 11 and 12 - guidelines laid down by AICTE Regulations have not been followed with respect to admissions to NRI quota and interest of unsuspecting innocent and uninformed students has been harmed - Whether CIT(A) was correct in not appreciating that even though the assessee does not strictly fall in the ambit of the AICTE Act, it is bound to follow the spirit of law on admission to NRI quota, which has not been adhered to and thus the assessee was rightly held not eligible for exemption u/s 11 and 12 of the Act? - HELD THAT:- As mentioned earlier, no adverse inference has also been given as regards fee concession/ scholarships given to students, details of which are available on record whereas in the case of P.A. Inamdar v. State of Maharashtra [ 2005 (8) TMI 614 - SUPREME COURT] have held that differential fee structure is allowable pay higher fees could be charged from richer students with the purpose of subsidising the students from economically weaker section. The denial of exemption under section 11 and 12 by the Assessing Officer cannot be sustained. Assessing Officer is directed to allow exemption under section 11 and 12 with all consequential benefits. - Decided against revenue.

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• 2021 (10) TMI 25
  Addition being cash deposited in the bank account of the assessee - assessee s submissions that assessee had given his portion of land of 17.40 Acres of cultivable land on which cash crops are grown to his brother for cultivation at an annual lease for which cash deposited in the bank account of the assessee - HELD THAT:- The fact that the land being purchased at Chhattisgarh by the assessee along with his brother Pratap Singh who is staying at Chhattisgarh and cultivating his portion of land and also taken over the land of the assessee on lease has not been controverted by the Revenue. The contention of the assessee that the agreement for lease of land being an oral agreement simply cannot be brushed aside in view of the fact that the lease of land is to the real brother of the assessee who is also an agriculturists and the confirmation of brother of having taken the land on lease from assessee and the payment of lease in cash. In such a situation, the agreement in the form of oral understanding between the blood relations cannot be discarded without there being any evidence to the contrary. - Thus source of cash deposits to be explained. - Decided in favour of assessee. Estimation of household expenses - HELD THAT:- AR submission that we during the relevant period assessee was staying in a village with his wife and two minor sons who were not school going and the milk and grains which are available from his own farm and cattle was sufficient to meet his basic daily requirements has not been controverted by Revenue by placing any contrary evidence on record - expenditure of Rs. 1,00,000/- towards household expenses shown by the assessee cannot be discarded without any evidence to the contrary - Decided in favour of assessee.

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• 2021 (10) TMI 24
  Addition u/s.68 - unsecured loans - HELD THAT: - From the financial status as enumerated by ld CIT(A) in the impugned order, we find that all three creditors have sufficient reserves and surplus as reflected in their audited balance sheet, hence, there is no question to doubt their creditworthiness to advance the loan to the assessee. As noted by ld CIT(A) has accepted that Shri Narendra Kumar Jain is an entry provider in Kolkata but he is not a director of above three companies. Based on the fact that Shri Narendra Kumar Jain is an entry provider, it cannot be assumed that he has managed to rout the money from the creditors to the assessee - in the absence of any specific defect being pointed out in the order of the CIT(A), we find no good reason to interfere with the order of the CIT(A), which is hereby confirmed and the grounds of appeal of the revenue are dismissed.

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• 2021 (10) TMI 23
  Reopening of assessment u/s 147 - survey action u/s.133A conducted in the premises of Sarvajanik Janakalyan Parmarthik Nyas, Bhopal and some loose papers were impounded - on the basis of those loose paper, the AO issued notice u/s.148 and found amount in cash paid for the admission of his son in MBBS course - HELD THAT:- It is an admitted fact that during the course of survey, some loose papers were impounded and on the basis of same, it was gathered that some students have taken admission in MBBS course by giving donation. Out of those students, the name of the assessee s son is appearing having paying Rs. 3,50,000/-. But the issue for consideration before us is, as to whether, the amount written in pencil and impounded from the third person, can be taken as basis for adding the amount to the income of the assessee. It is also noted in the orders of lower authorities that some students have admitted of giving donation for taking admission but in the case of the assessee, he has denied to give any donation for the admission of his son. Merely because some students/parents have admitted, that cannot be used against the assessee without any plausible materials - Decided in favour of assessee.

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• 2021 (10) TMI 22
  Disallowance u/s 14A r.w.r.8D - HELD THAT:- On careful consideration of the rival contentions we find that as there is no exempt income earned by the assessee there cannot be any disallowance u/s 14A - Decided in favour of assessee. Suo Moto disallowance u/s 14A - HELD THAT:- As the assessee has offered suo moto disallowance of Rs. 2 lakhs, failed to give any breakup of such expenditure, itself said that it has not incurred any expenditure in relation to exempt income, we do not find any infirmity in the order of the learned CIT A in retention of disallowance of Rs. 2 lakhs. Thus, ground numbers 2 4 of the appeal of the assessee are also dismissed. Disallowance of corporate social responsibility claimed as a business expenditure eligible u/s 37 (1) - deduction u/s 80 G of the act of the above expenditure - HELD THAT:- We find that assessee has given donation to three organizations. Assessee has failed to establish that how these expenditure has been incurred by the assessee wholly and exclusively for the purposes of the business. Therefore, we do not find any infirmity in the order of the lower authorities in denying the deduction of the above expenditure u/s 37 (1) - as assessee has obtained donation receipt from all these three organization, which are registered u/s 80G of the income tax act, we direct the learned assessing officer to grant the deduction of the above donation under the above Section. Accordingly, ground number six of the appeal of the assessee is allowed. Disallowance on account of sales tax liability additionally imposed by the sense tax department Mumbai for the period 1/4/1971 31/3/1992 - HELD THAT:- Merely because the assessee has been granted a refund arising out of the above appellate order on 19th of March 2009 of Rs. 223,019 it cannot be said that liability for payment of the sum of Rs. 720,081 arose in assessment year 2010 11. Therefore, the claim of the assessee is undoubtedly allowable for assessment year 2009-10 and correctly disallowable for assessment year 2010 11. Therefore, we confirm the disallowance made by the assessing officer for assessment year 2010 11 in case of the assessee. Thus we do not find any infirmity in the order of the learned CIT A. Allowability of the above claim of the assessee in assessment year 2009-10, AR has referred to the special bench decision of joint Commissioner of income tax versus Mukand Ltd [ 2007 (2) TMI 358 - ITAT MUMBAI] as well as the decision of the coordinate bench in case of Perfect equipments [ 2001 (11) TMI 214 - ITAT AHMEDABAD-A] it has been held that the provisions of Section 153 (3) gives the power to the appellate authority lifting the bar of the time limitation for giving effect to the finding or direction contained in the order of the tribunal regarding bringing to tax the escaped income as well as the claim allowable in different year, we, respectfully following the above judicial precedents, direct the learned assessing officer to grant the above deduction in assessment year 2009 10. Appeal of the assessee is dismissed subject to allowing the above claim in assessment year 2009 10. Disallowance paid towards statutory taxes - HELD THAT:- CIT - A considered the claim of the assessee in paragraph number 30.4 by considering the claim of the assessee for deduction of Rs. 125,100 allowing the balance claim but retaining the addition at Rs. 83,755/ the assessee is aggrieved with that. The above amount comprises of two different sums (1) payment of Rs. 67,725 was relating to assessment year 2007 08, (2) a sum of Rs. 16,030 sales tax demands for assessment year 2003 04. We find that assessee has paid both the sums during the year and claimed as deduction. As the assessee has paid the above sum during the year and there is no finding that such sum were incurred in another year but paid during the year, we direct the learned assessing officer to delete the above disallowance and allow the claim of the assessee.

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• 2021 (10) TMI 21
  Reopening of assessment u/s 147 v/s assessment u/s 153C - additions made on the basis of the document which belongs to the assessee - HELD THAT:- It is an undisputed fact that the assessee was not covered under the search action u/s 132 of the Act. It is thus the case of the assessee that no addition could be made u/s 143(3) r.w.s 147 of the Act on the basis of the materials seized during the course of search and the proper course of action for framing the assessment by the AO was to proceed on the basis of the provisions of Section 153C of the Act as the incriminating material that has been relied upon by the AO for making additions belongs to the assessee. As decided GLITZ BUILDERS PROMOTERS PVT. LTD AND VICE - VERSA [ 2021 (1) TMI 1074 - ITAT DELHI] quashed the assessment framed u/s 143(3) by holding that the additions made on the basis of the document which belongs to the assessee could not be made in the assessment framed u/s 143(3) of the Act but the AO should have invoked the provision of Section 153C of the Act which is mandatory - Decided in favour of assessee.

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• 2021 (10) TMI 20
  Validity of reopening of assessment u/s 147 - eligibility of reasons to believe - non-compliance of procedure - non-disposing of objections filed by the assessee before completion of assessment - HELD THAT:- As decided in M/S. DEEPAK EXTRUSIONS PVT. LTD. [ 2017 (3) TMI 1257 - KARNATAKA HIGH COURT] with regard to the non following of procedure prescribed by Hon ble Supreme Court in the case of GKN Drive Shafts India Ltd [ 2002 (11) TMI 7 - SUPREME COURT] AO did not dispose of the objections prior to proceeding with the assessment further and proceeded to pass the order for assessment. Under the circumstances, it can be said that the mandatory procedure of disposal of the objection by Assessing Officer before proceeding with the assessment has not been folio ed and exercise of power can be said as not only vitiated, but the order of assessment cannot be sustained - also see SHRI. LAKSHMANA, S/O. LATE CHIKKATHIMMAIAH case [ 2021 (7) TMI 1141 - ITAT BANGALORE] - Decided in favour of assessee.

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• 2021 (10) TMI 19
  Addition u/s 69A - cash deposits made during the demonetization period in specified bank notes - HELD THAT:- In this case, there is no dispute that the assessee furnished the details before the Ld.CIT(A) and copy of the paper book was placed before us. As per the information placed in the paper book it is evident that the assessee has sold the shares of Legacy Mercantile Limited and received an amount on sale of shares and claimed the same as exempt u/s 10(38) of the Act. The assessee sold the shares through DEMAT account. CIT(A) verified the entire issue and decided the appeal. As per section 69A, where the assessee is found to be owner of any money, bullion, jewellery which is not recorded in the books of accounts, the same required to be brought to tax. In the instant case, the assessee had sold the shares and received the sale proceeds, thus, the source stands explained. What was claimed by the assessee was exemption u/s 10(38) which ought to have been disallowed by the AO. In the instant case, the assessee has recorded the transactions in the books of accounts as evident from the cash book and financial statements furnished by the assessee along with paper book. Therefore, there is no case for making addition u/s 69A and we do not find any reason to interfere with the order of the Ld.CIT(A) and the appeal of the revenue on this ground is dismissed. Addition on profit from sale of car - assessee reduced the said amount from P L account, but not offered the same under the head Capital Gains - HELD THAT:- In the instant case, the assessee credited the profit on sale of car in Profit Loss account, but the car is part of the block of assets and the sale consideration of the car required to be reduced from the block of assets. As per the computation given by the Ld.CIT(A) in appeal order, we find that the assessee has rightly reduced the sale of old car from the block of assets and claimed the depreciation on the written down value hence, there is no case for making the addition on sale of car. Therefore, we hold that the Ld.CIT(A) rightly deleted the addition and the same is upheld. Appeal of the revenue on this ground is dismissed Admission of additional evidence by CIT-A - department s contention that the assessee has filed additional information in respect of long term capital gains and sale of old car, therefore, contended that the Ld.CIT(A) ought to have remitted the matter back to the file of the AO - HELD THAT:- As per the provisions of section 250(4 )of the Act, the Ld.CIT(A) is permitted to make further enquiries before disposing the appeal. The assessee has filed paper book and furnished the information that was placed before the CIT(A) or lower authorities.The information with regard to addition u/s 69A, sale of shares and depreciation on car are very simple issues and the department did not bring any defect or error in the information filed in the paper book. Since, the Ld.CIT(A) duly verified the information placed before him and for which he is permitted to cause enquiries, we find that ground raised by the department under Rule 46 is only for the sake of continuation of litigation and no fruitful purpose would be served. In the facts and circumstances, we do not see any valid reason to remit the matter back to the file of the AO. Therefore this ground of appeal of the department is dismissed.

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• 2021 (10) TMI 18
  Revision u/s 263 - Correctness/computation of capital gains - Share of capital gain - HELD THAT:- In the instant case, there is no dispute that the assessee has admitted the capital gains in the returns of income and the case was taken up for scrutiny for the purpose of verification of large long term capital gains. During the course of assessment proceedings, the AO called for the relevant details in respect of computation of capital gains as evident from para No.5 and 6 of the assessment . The issue with regard to correctness of capital gains was verified by the AO before completing the assessment. In the instant case, the assessee along with 4 others (co- owners)transferred the land admeasuring 10,648 sq.yards for development on 50:50 basis and the assessee is having 1/5th share in the said land. Since the co-owners have transferred the land in lieu of receipt of 50% of constructed area and retained the 50% of land towards their share, for the purpose of computation of capital gains, only 50% of the land transferred to the developers share required to be considered but not the entire land. This Tribunal in the case of Vijaya Medical Center [ 2018 (4) TMI 1517 - ITAT VISAKHAPATNAM] on similar facts viewed that capital gains has to be computed on 50% of the land transferred to the developer when the land was given for development on 50:50 basis. There is no dispute that the AO has called for the details and considered the issue of capital gains in the assessment order. It is undisputed that the assessee has transferred the land for development and entitled to 50% of the constructed space and the land. As on the date of transfer there is no constructed space is available. Therefore, On facts and the law we are of the view that the AO rightly has computed the capital gains and the assessment order passed by the AO is neither erroneous nor prejudicial to the interest of the revenue - Decided in favour of assessee.

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• 2021 (10) TMI 17
  Unexplained expenditure u/s 69C - Addition in respect of construction of staff quarters - HELD THAT:- As evident from the information placed by the assessee before us that the staff quarters including amenities constructed was Rs. 12.50 crores. AO himself has accepted that cost of staff quarters in 152 Nos. was estimated to be at Rs. 7.5 crores against the actual expenditure of Rs. 7.96 crores. AO did not consider other infrastructure facilities and amenities provided by the assessee while working out the capital expenditure for construction of staff quarters on which the depreciation is claimed. The department during the appeal hearing did not bring any material to controvert the submission made by the assessee and the assessee has demonstrated that the expenditure incurred for construction of staff quarters and other amenities was Rs. 12.5 crores. It is also fact that the assessee has taken financial assistance from the banks / financial institutions for construction of staff quarters. Thus, the assessee has explained the source for construction as well as demonstrated the cost of construction. Disallowance of depreciation as disallowed in respect of the expenditure incurred in construction of staff quarters - HELD THAT:- CIT(A) has examined the issue in detail and held that the assessee has correctly claimed the depreciation on staff quarters. We have decided in this order that the addition made by the AO is unwarranted and accordingly upheld the order of the CIT(A). Having decided the issue in favour of the assessee with regard to the cost of construction of staff quarters, we, hold that the assessee is eligible for Depreciation on Staff quarters. Addition relating to staff quarters maintenance - As viewed that the assessee has claimed the excess expenditure and accordingly allowed the proportionate expenses on the basis of electricity service connections and disallowed the balance amount - HELD THAT:- In the instant case the assessee has debited the staff quarters maintenance - assessee was maintaining regular books of accounts which were duly audited by the qualified chartered accountant. During the assessment proceedings, the AO called for various details, which was furnished by the assessee and verified by the AO. No defects were noticed in respect of the various claims from the information placed by the assessee before the AO. AO simply compared the electricity connections and disallowed the expenses on the basis of number of connections increased during the year, without looking into the details of various heads of expenditure in maintenance of staff quarters such as cleaning, drainage, maintenance of roads etc. Making the disallowance without any basis and material is incorrect, therefore, we uphold the order of the Ld.CIT(A) and dismiss the appeal of the revenue. In the result appeal of the revenue on this ground is dismissed.

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• 2021 (10) TMI 16
  Exemption u/s. 54F - Denial of claim as assessee has not made any investment in purchase/construction of any residential house - assessee himself has admitted that the existing residential property owned by him consisted of 3 independent houses out of which one is self-occupied and other two have been let out for rent. Since the assessee is having more than one residential house, the conditions prescribed u/s 54F of the Act has been violated - HELD THAT:- We have noticed that the assessee has paid the amount of Rs. 80.00 lakhs on 22.4.2013, while the vacant plot was sold on 30-8-2012, meaning thereby, the assessee has invested the a sum of Rs. 80 lakhs, out of sale consideration of Rs. 85.00 lakhs in purchasing a new residential property. The fact that the assessee got the property only in 2018 is due to reasons beyond the control of the assessee, which has been narrated in the earlier paragraphs. Hence the assessee should not suffer for the delinquency of the builder and accordingly we are of the view that the assessee should be granted deduction u/s 54F of the Act for the amount of Rs. 80 lakhs given to the builder within the prescribed time, subject to fulfillment of other conditions. Since there was no occasion for the AO to examine details of purchase of new property, we are remitting this issue for examining the details of purchase of new residential house property. Assessee is owning three residential houses - The ground floor is used by the assessee and the first floor has been let out to two tenants. The assessee invited our attention to the building plan and some other documents. Accordingly the Ld A.R contended that there is no violation of sec.54F of the Act on this aspect. In our view, this fact also requires examination at the end of the AO. If the assessee owns only one residential property, which consisted of three residential units, in our view, it should be considered as one residential house only. In this regard, we derive support from the decision rendered by the co-ordinate bench in the case of Shri Bhatkal Ramarao Prakash [ 2019 (2) TMI 1059 - ITAT BANGALORE] Appeal of the assessee is treated as allowed for statistical purposes.

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• 2021 (10) TMI 15
  Estimation of profit - assessee took a ground that the AO had not allowed salary and interest to partners against the estimated profit to which ld. CIT(A) did not agree as in his opinion in the earlier round, the ITAT, Lucknow [ 2015 (8) TMI 1536 - ITAT LUCKNOW] had already confirmed the findings of ld. CIT(A) to this extent - HELD THAT:- As gone through the order passed by the Tribunal it has rejected the contentions of assessee and has confirmed the finding of ld. CIT(A) - The assessee if aggrieved with such Tribunal order should have approached the Hon ble High Court or should have filed miscellaneous application before this Tribunal for rectification of mistake if any which it has not done and through the grounds of appeal the assessee wants the Tribunal to review its own order which is not permissible in law. Appeal dismissed. Penalty u/s 271(1)(c) - concealment of income - AO estimated the income of the assessee by applying the net profit ratio and has rejected the books of accounts - HELD THAT:- Penalty u/s. 271(1)(c) of the Act is imposable on an assessee if an assessee conceals its income or furnishes wrong particulars of income. Since the books of account of the assessee has been rejected and total income has been computed on the basis of N.P. ratio there is no scope for imposition of penalty u/s. 271(1)(c) of the Act. In a number of judgment of various Benches of the Tribunal and courts this view that once books of account are rejected and income is estimated by applying N.P. rate, penalty u/s. 271(1)(c) is not imposable. See NARESH CHAND AGARWAL [ 2013 (6) TMI 68 - ALLAHABAD HIGH COURT] - thus penalty imposed by Assessing Officer u/s. 271(1)(c) of the Act is not leviable. - Decided in favour of assessee.

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• 2021 (10) TMI 14
  Income accrued in India - Taxability of infrastructure data centre (IDC) charges as royalty - HELD THAT:- As decided in own case [ 2021 (1) TMI 76 - ITAT MUMBAI] we hold that IDC charges received by the assessee is not in the nature of royalty. Accordingly, additions are deleted. Addition of other service charges (referral fee) as royalty - HELD THAT:- As decided in own case [ 2021 (1) TMI 76 - ITAT MUMBAI] we hold that referral fee received by the assessee is not in the nature of royalty. Accordingly, addition made in both the assessment years under dispute is deleted. Respective ground is allowed. Addition of member login fee as royalty - HELD THAT:- As decided in own case [ 2020 (7) TMI 644 - ITAT MUMBAI] Assessee merely provides a standard facility to the Indian entity without granting any exclusive right in respect of any copyright, process, etc. It is further relevant to observe, learned DRP, while deciding the issue has clearly and categorically observed that member login services are similarly to IDC services. If that is the factual position, the member login fee cannot be treated as royalty since, while deciding assessee s appeal challenging the taxability of fees received towards IDC services, the Tribunal has consistently expressed the view that the services cannot be treated as royalty under the India-Singapore Tax treaty. In aforesaid view of the matter, we hold that member login fee is not in the nature of royalty under the treaty provision. Accordingly, addition is deleted.

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• 2021 (10) TMI 12
  Characterisation of loss - loss from share transactions - short term capital loss to be treated as income under the head capital gains or business income/loss - HELD THAT:- As the facts and the issue involved in the case of the assessee for the year under consideration remains the same as were there before the Tribunal in the assessee s own case for A.Y. 2007-08 and A.Y. 2008-09[ 2015 (3) TMI 798 - ITAT MUMBAI] which as observed by us hereinabove had fairly been admitted by the ld. D.R, we, therefore, finding no reason to take a different view therein respectfully follow the same. Accordingly, finding no infirmity in the view taken by the CIT(A), who as observed by us hereinabove had held that the gain/loss arising on sale of purchase of shares under consideration was rightly reflected by the assessee under the head Short Term Capital Gain , thus, uphold the same. The Ground of appeal No. 1 raised by the revenue is dismissed.

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• 2021 (10) TMI 9
  Reopening of assessment u/s 147 - addition u/s 68 on account of bogus purchases - HELD THAT:- As decided in the case of Nihal Chand Rakyan [ 2017 (12) TMI 1813 - ITAT DELHI] reassessment proceedings initiated by the Assessing Officer is invalid. Therefore, subsequent assessment framed is void ab initio. In the result, the appeal filed by the assessee is allowed on the issue of validity of the reassessment proceedings. - Decided in favour of assessee.

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• 2021 (10) TMI 8
  Non filing of appeal electronically - appeal of the assessee dismissed as not having been filed electronically not in conformity with the procedure contemplated in Rule 12(3) of the Income Tax Rules, 1962 - HELD THAT:- As in the case of All India Federation of Tax Practitioner, Mumbai, [ 2018 (6) TMI 1171 - ITAT MUMBAI] as observed by the Tribunal that as the default on the part of an assessee in filing the appeal in paper form was merely a technical defect which could not be allowed to overshadow the cause of substantial justice, therefore, it had set-aside the order of the CIT(A), with a direction to him to consider the appeal filed electronically by the assessee Thus appeal, in all fairness and in the interest of justice is restored to the file of the CIT(A). The CIT(A) is directed to consider the appeal which was electronically filed by the assessee as having been filed on the date on which the same was manually filed in paper form i.e on 28.03.2016 and dispose off the same on merits by way of a speaking order. CIT(A) while disposing off the appeal shall afford a reasonable opportunity of being heard to the assessee. Order passed by the CIT(A) is set-aside, and the matter is restored to his file for fresh adjudication.

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• 2021 (10) TMI 7
  Income from House Property - Disallowance of deduction u/s 24(b) - interest on Home Loan - addition on the ground that the possession of property has not yet been acquired by the appellant - HELD THAT:- As for claiming deduction of interest under Sec. 24(b) of the Act there is neither any such precondition nor an eligibility criteria prescribed that the assessee should have taken possession of the property so purchased or acquired by him. we are unable to persuade ourselves to accept the view of the CIT(A) that as in the absence of any control/domain over the property in question the assessee would not be in receipt of any income from the same, therefore, allowing of deduction under Sec. 24(b) qua the said property would be beyond comprehension. We are afraid that the said view of the CIT(A) is absolutely misconceived and in fact divorced of any force of law. Determination of the annual lettable value of a property - same as per Sec. 22 r.w Sec. 23 of the Act is dependant on the ownership of the property, irrespective of the fact whether the assessee has taken the possession of the same or not - as per the plain literal interpretation of Sec. 24(b) of the Act there is no bar on an assessee to claim deduction of interest payable on a loan taken for purchasing a residential property, though, the possession of the same might not have been vested with him, however, even otherwise the logic given by the CIT(A) for declining the aforesaid claim of deduction of the assessee clearly militates against the mandate of Sec. 22 to 24 of the Act. Accordingly, as in the case before us the assessee had admittedly paid interest on the capital that was borrowed by him for acquiring the property in question, which was duly evidenced on the basis of the certificate that was filed in the course of the assessment proceedings, therefore, we are unable to concur with the lower authorities who had declined his aforesaid claim for deduction of interest under Sec. 24(b) of the Act. We, thus, not finding favor with the view taken by the CIT(A) therein set-aside his order and direct the A.O to allow the assessee s claim for deduction of Rs. 2 lac under Sec. 24(b) of the Act. - Decided in favour of assessee.

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• 2021 (10) TMI 6
  Addition of on-money paid by the assessee to the Builder for purchasing the flat - assessee submitted that all the payments were made through banking channels only - CIT-A deleted the addition - HELD THAT:- Except for entry in the pen-drive, there is nothing in the kitty of Ld. AO to conclude that the assessee paid on-money to the builder. The additions were made purely on the basis of third-party entry. Except for allegation, there is nothing on record which would indicate that the assessee has paid cash to the builder. Assessee was non-resident and residing in Spain. The assessee did not have any source of Income in India which is evident from the fact that it filed Nil return of income. It was not possible to bring such amount of cash from Spain to India otherwise than through banking channels. The Ld. CIT(A) has clinched the issue in right perspective. Finding no reason to interfere in the same, we dismiss the appeal.

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• 2021 (10) TMI 5
  TDS u/s 194A - Short deduction of tax /default in tax deduction on interest paid on FDR s/KDR s - HELD THAT:- During the course of hearing, the appellant was asked to furnish copy of FDRs accounts to show and establish that no interest is accrued and credited to the specific accounts during the year. The appellant failed to furnish the same during the course of appeal proceedings - as brought out by the A.O. the appellant was deducting and depositing TDS on quarterly basis on these FDRs/KDRs till 2011-12. As appellant has not been able to establish that it is covered by circular 3/2010. By not deducting T.D.S. at the time of making a provision, the appellant has violated the explanation to section 194A therefore, hold that the order passed by the Assessing Officer treating the appellant as an assessee in default, u/s.201 r.w.s. 194A of the Income tax Act is correct and deserves to be sustained. A.O. has already passed the rectification order dated 12.01.07 wherein the demand on account of short deduction has been reducedby giving credit for TDS deducted at the year end. The balance short deduction and interest computed in the aforementioned rectification order is accordingly upheld. We have gone through the same and do not find any infirmity. Allowing set off of excess tax deducted in subsequent quarters - We find that the same has already been considered and allowed by the CIT(A). After confirming the order of the AO that TDS on interest paid on FDR s and TDR s was required to be deducted quarterly as opposed to yearly deduction by the assessee, he went on to hold that the AO should give credit of tax deducted at the year end and further noted that a rectification order dated 12.01.07 to this effect reducing the demand on account of short deduction of TDS has already been passed by the AO. We fail to understand the grievance now remaining to be addressed on this account. Ground of appeal No.1 is therefore dismissed. Not implementing Circular No.03/2010 of the CBDT - We find that the Ld.CIT(A) has given a clear finding that the assessee was unable to establish how it was covered under the said circular. The import of the said circular, we find is that the CBDT had clarified that on account of the Core Branch Banking Solution (CBS) Software wherein for monitoring purposes alone interest is calculated on daily or monthly basis and is swept and kept in provisioning account, TDS is not to be deducted at this point but at the time of giving actual credit to the depositors. CIT(A) found that the assessee was unable to establish that it was covered by the said circular - no reason to interfere with the order of the Ld.CIT(A). Default for not deducting tax on interest payments where Form No.15G/15H had not been obtained - plea of the assessee being that the interest payment related to persons who were litigants on whose behalf various courts/judges/registrar of High Court had made deposits with the bank - Before us the plea of the assessee is that the said circular has been quashed by Hon ble Delhi High Court. But no such decision has been brought to our notice. In view of the same, we cannot but uphold the findings of the Ld.CIT(A).

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• 2021 (10) TMI 4
  Revision u/s 263 by CIT - Addition of unexplained cash credit u/s 68 - Estimation of income - HELD THAT:- On account of the assessees inability to produce any evidence in support of the cash deposits that the Assessing Officer has proceeded to treat the total of the cash deposits also as the turnover of the assessee and estimate the income thereon at 12% as against 5.5% initially done by the Assessing Officer. It is, therefore, clear that the Assessing Officer has followed the directions of the CIT to verify the sources of the cash deposits and thereafter, on the inability of the assessee to explain the same, the AO has adopted one of the possible views i.e., to treat the cash deposits as business receipts and to estimate the income at a percentage of the cash deposits or to make an addition of the entire deposits u/s 68. AO has deemed it fit and proper to treat the cash deposits as the business receipts of the assessee and to estimate the income thereon at 12%. Therefore, it cannot be said that the assessment order u/s 143(3) r.w.s. 263 dated 27.10.2014 is erroneous. By not bringing to tax the entire cash deposits u/s 68 of the Act, the assessment order may be said to have been prejudicial to the interest of the Revenue. But, for a valid revision, both the conditions i.e. the assessment order being erroneous and also being prejudicial to the interest of the Revenue are to be satisfied. - Decided in favour of assessee.

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• 2021 (10) TMI 3
  Estimation of income - bogus purchases - CIT-A estimated at 12.5% of the aggregate value of the impugned purchases - HELD THAT:- CIT(A) had rightly concluded that as the sales could not have been carried out de hors the corresponding purchases thus, it could safely be concluded that the assessee had purchased the goods in question though not from the aforementioned hawala parties, but at a discounted value from the open/grey market - CIT(A) in our considered view had rightly restricted the addition to the extent of the profit embedded in procuring of the impugned goods at a discounted value from the dealers operating in the open/grey market. We concur with the view taken by the CIT(A) that the addition in the hands of the assessee was liable to be restricted only to the extent of the profit element embedded in the impugned purchases in question. Also, we subscribe to the quantification of the said profit element by the CIT(A) at 12.5% of the aggregate value of the impugned purchases. - Decided against revenue.

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• 2021 (10) TMI 2
  Estimation of income - Bogus purchases - information received from Sales-tax department through the Investigation Wing - HELD THAT:- As in course of assessment proceedings, though, the assessee furnished some documentary evidences, however, they were not to the satisfaction of the Assessing Officer. Therefore, he treated the purchases as non genuine. However, ultimately, he restricted the disallowance to 16% being the gross profit shown by the assessee. Assessing Officer was convinced that not only assessee had purchased the goods, but corresponding sales have been made. As find, while dealing with identical nature of dispute in assessee s own case in assessment year 2010-11, the Tribunal [ 2020 (5) TMI 695 - ITAT MUMBAI] has restricted the disallowance to 3% of the alleged non genuine purchases. The factual position relating to the disallowance made in the impugned assessment year is identical. - Thus restrict the disallowance to 3% of the alleged non genuine purchases - Decided partly in favour of assessee.

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• Customs

• 2021 (10) TMI 40
  Seeking provisional release of goods - Withholding the clearance of the petitioners silk fabrics, woollen and silk carpets etc. covered under various shipping bills - Seizure of goods - HELD THAT:- The respondents ought to be permitted to adopt the further course of action of issuance of show cause notices to the petitioners on or before December 6, 2021. Dr. Kantawala would also have no objection for such course of action to be adopted. Of course as to what has happened in the interregnum shall be subject to the outcome of any adjudication of the proceedings on the show cause notice. Whether detaining of the 53 carpets as samples for forensic purposes can continue indefinitely, would be required to be answered considering the provisions of Section 105, Section 110 read with Section 124 and Section 2(22) of the Act? - HELD THAT:- The proper officer did not have any authority to retain the 53 carpets contrary to what has been provided for in sub-section (2) of Section 110. This more particularly as these carpets are retained for forensic purpose and also that the seized goods are already permitted to be provisionally released as per the provisions of Section 110A of the Act - 53 carpets which are retained as samples for forensic purpose are also required to be returned to the petitioners at the end of the extended period. Mr. Jetly would also fairly state that the department is at the final stage of investigation. These petitions would not warrant any further adjudication - Petition disposed off.

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• Insolvency & Bankruptcy

• 2021 (10) TMI 11
  Seeking liquidation of the Corporate Debtor - Section 33 (2) of Insolvency and Bankruptcy Code, 2016 - HELD THAT:- This Tribunal under the circumstances, in the circumstances taking into consideration the provisions of law, as well as on facts is hereby orders for liquidation of the corporate debtor M/s. Awsum Proteins Limited , and in the circumstances the corporate debtor stands Liquidated and the incidence of liquidation to follow, on and from the date of this order in terms of the provisions of IBC, 2016 and more particularly as given in Chapter - III of IBC, 2016 and also in terms of Insolvency and Bankruptcy (Liquidation Process) Regulations, 2017 along with the directions issued. The Corporate Debtor is ordered to be liquidated - moratorium shall cease to have effect - application allowed.

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• PMLA

• 2021 (10) TMI 48
  Acute shortage of staff members as also vacancies at the level of the Chairperson, Member (Administration) and Member (Law) - HELD THAT:- Considering the fact that benches of the Adjudicating Authority hold hearings, and the quantum of cases is considerable, it is not sufficient to merely fill up the vacancies as they exist today, but there is also a need to increase the manpower within the Adjudicating Authority, in order to enable the authority to function in an efficient manner. Insofar as the Chairperson is concerned, it is submitted by Mr. Mahajan, ld. CGSC, under instructions from Mr. Pandey, that the selection for the Chairperson is underway and is likely to conclude shortly - For the positions of Member (Administration) and Member (Law), the proposal for issuance of vacancy circulars is stated to be under consideration. Since these positions have been vacant for a considerable period of time, the Government is directed to take steps for filling up the said posts, within a period of three months. Insofar as the Administrative Officer and Registrar are concerned, in view of the recommendations of the UPSC, as also the lack of a sufficient number of applicants, it appears that appointments have not taken place despite the vacancy circulars having been issued - if these vacancies cannot be filled up through fresh recruitment, the Ministry shall take steps to fill up all these vacancies through alternate means, within a period of one month from today. Let a fresh status report be filed in this regard, within a period of two months - List for conclusion of submissions in all these petitions on 30 th September, 2021 at 3:30 pm.

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• Central Excise

• 2021 (10) TMI 13
  CENVAT Credit of CVD - import of steam coal which is used for generation of steam / electricity which is in turn used in relation to the manufacture of final products - concessional rate of duty as per N/N. 1/2011-CE dt. 1.3.2011 (Sl.No.28) denied as appellants has already availed the benefit of N/N.12/2012-Cus. 17.3.2012 - applicability of Board s Circular No.41/2013-Cus. dt. 21.10.2013 - HELD THAT:- The bar to take cenvat credit is only when the benefit of exemption specified at Sl.No.67 and 128 under N/N.12/2012-CE dt. 17.3.2012 is availed. The CCR 2004 does not impose any bar or restriction in availing credit when the benefit of exemption is availed under the N/N.12/2012-Cus. dt. 17.3.2012. The issue stands decided in the decision of Hindustan Zinc Ltd. [ 2021 (7) TMI 199 - CESTAT NEW DELHI ] where on similar issue, credit was allowed. The demand cannot sustain - Appeal allowed - decided in favor of appellant.

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• 2021 (10) TMI 10
  Maintainability of appeal - non-prosecution of the case - Rule 20 of the CESTAT (Procedure) Rules, 1982 - HELD THAT:- Since the appellant has been choosing to abstain from hearing before the Tribunal, the appeal is liable to be dismissed under Rule 20 of the CESTAT (Procedure) Rules, 1982. Further, it is found that this appeal has been filed by the appellant against letter dated 16.10.2017 on 14.01.2019 after considerable delay. There is no application for condonation of delay in filing the appeal. No appeal lies in Tribunal against the order of Revisionary Authority - the appeal is dismissed for non-prosecution under Rule 20 of the CESTAT (Procedure) Rules, 1982.

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• CST, VAT & Sales Tax

• 2021 (10) TMI 41
  Refund of tax - violation of statutory provision - section 42 of DVAT Act - HELD THAT:- The concerned Respondent Authority is directed to decide the claim, as and when the same is preferred by the Petitioner, for refund as stated in the memo of this petition, in accordance with law, rules, regulations, Government policies applicable to the facts and circumstances of this case and on the basis of the evidence on record and also keeping in mind the law of limitation for getting the refund and also keeping in mind the principles of unjust enrichment . Petition disposed off.

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• 2021 (10) TMI 29
  Validity of re-assessment order - failure to account for the purchases alleged to have been made from the State of Rajasthan - Section 64(1) of the KVAT Act - HELD THAT:- The fact remains that in furtherance to the orders of the Revisional Authority as per Annexures-A B, the Prescribed Authority has passed the reassessment order on 05.07.2021 for the A.Y. 2013-14 and 2014-15 as per Annexures-Q R. The direction issued by the Revisional Authority has thereby stood complied. The appellant-assessee has participated in the reassessment process. The appellant-assessee has not filed any appeal against the said reassessment order as provided under the Act. The present appeal is u/S.66(1) of the KVAT Act, 2013 challenging the orders of the Revisional Authority at Annexures-A B. The Hon ble Apex Court in the case of Assistant Commissioner (CT) LTU, Kakinada Others Vs. M/s. Glaxo Smith Kline Consumer Health Care Ltd. [ 2020 (5) TMI 149 - SUPREME COURT ] has held that wherever the statutory remedy of appeal is provided, an aggrieved person must exhaust such remedy. In view of the changed facts and circumstances of the case namely the Prescribed Authority having complied with the direction issued by the Revisional Authority by passing orders as per Annexures-P Q, no purpose would be served in entertaining the present appeal insofar as challenge to the orders of the Revisional Authority dated 2.11.2020 as per Annexures-A and B - Appeal disposed off.

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• Indian Laws

• 2021 (10) TMI 49
  Trespassing of scheduled properties - summon order - vicarious liability of executives - offences punishable under Sections 427, 447, 506 and 120B read with Section 34 IPC - HELD THAT:- Looking to the averments and the allegations in the complaint, there are no specific allegations and/or averments with respect to role played by them in their capacity as Chairman, Managing Director, Executive Director, Deputy General Manager and Planner Executor. Merely because they are Chairman, Managing Director/Executive Director and/or Deputy General Manager and/or Planner/Supervisor of A1 A6, without any specific role attributed and the role played by them in their capacity, they cannot be arrayed as an accused, more particularly they cannot be held vicariously liable for the offences committed by A1 A6. From the order passed by the learned Magistrate issuing the process against the respondents herein accused nos. 1 to 8, there does not appear that the learned Magistrate has recorded his satisfaction about a prima facie case against respondent nos. 2 to 5 and 7 8. Merely because respondent Nos. 2 to 5 and 7 8 are the Chairman/Managing Director/Executive Director/Deputy General Manager/Planner Executor, automatically they cannot be held vicariously liable, unless, as observed hereinabove, there are specific allegations and averments against them with respect to their individual role - the High Court has rightly dismissed the revision applications and has rightly confirmed the order passed by the learned Sessions Court quashing and setting aside the order passed by the learned Magistrate issuing process against respondent nos. 1 to 8 herein original accused nos. 1 to 8 for the offences punishable under Sections 427, 447, 506 and 120B read with Section 34 IPC. The present appeals deserve to be dismissed and are accordingly dismissed.

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• 2021 (10) TMI 45
  Seeking quashing of FIR issued for offences punishable u/s 120-B IPC and Sections 7A, 8 and 9 of the Prevention of Corruption Act, 1988 - Bribe - active role in the management of the Trust or its constituent institutes, played or not - violations of the GST Act discovered during Audit of the University - HELD THAT:- It is a settled principle that the power to interdict a proceeding either at the threshold or an intermediate stage of the trial is a power which inheres in a High Court, under Section 482 of the Cr.P.C., on the broad principle that in the event the allegations made in the FIR or the charge-sheet, as may be, prima facie do not disclose a triable offence, there can be no reason as to why the accused should be made to suffer the agony of a legal proceeding that more often than not gets protracted. A prosecution which is bound to become lame or a sham ought to be interdicted in the interest of justice lest the continuance thereof will amount to an abuse of the process of the law. A general argument made by the prosecution is that a general presumption under Section 20 of the Act against the public servant is that he has accepted or agreed to accept bribe, unless the contrary is proved by him. Thus, the burden of proof is on the accused public servant to prove his innocence. However, while making such a submission, the fallacy is that the presumption under Section 20 can be invoked against the accused only if, the investigating agency prima facie satisfies the court that the essential ingredients or the uncontroverted foundational facts unerringly point towards the presence of an act of bribery in a particular case. It is only in such cases, when the prosecution is able to specifically establish the proof of demand by the public servant which he has voluntarily demanded and accepted for doling out an undue advantage only then, can Section 20 be invoked against the accused public servant in question - it is thus to be borne in mind that the standard of proof as required for the explanation offered by the accused for this particular purpose, even at the stage of trial, has been held to be the yardstick of preponderance of probability and not that of the higher/stricter standard of beyond reasonable doubt. The CEO being the nerve centre in the management of the University was best suited to recognize whether the Accountant was an employee of the University or not. That being the case, it seems that the Accountant is a stranger to the University and the fact that an allegation has been made that the present petitioner trustee had conspired with this unknown stranger to the University to bribe GST officials for the ongoing audit process seems inherently improbable and absurd. This Court comes to the irresistible conclusion that the criminal proceedings in the present case are not warranted. As a sequitur it flows that the proceedings against the Petitioner herein be quashed and the same are hereby quashed accordingly, insofar as the role of the present Petitioner is concerned. Application disposed off.

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• 2021 (10) TMI 39
  Compulsory retirement of petitioner - petitioner is an officer of Indian Revenue Services (IRS) of 1985 batch - violation of principles of natural justice - HELD THAT:- An order of compulsory retirement is not a punishment nor it attaches any stigma to an employee Petitioner. Subjective satisfaction of the Government in public interest, arrived at after considering the entire service record of the Petitioner, where principal of natural justice is not required to be observed while passing an order of compulsory retirement because order of compulsory retirement does not amount to punishment - Compulsory retirement involves no civil consequences. The Government servant does not loose any of the rights acquired by him before retirement while a minimum service is granted to the Government Servant, the Government is given power to energize its machinery and make more efficient by compulsory retiring those who in its opinion should not continue in the service of the Government in the interest of public. Even if promotion has been granted to him, still compulsory retirement can be granted by Union of India under Rule 56(j) of Fundamental Rules as under the said rule the entire service record of the employee is to be seen and if the Review Committee is of the opinion that in the interest of public looking to overall service record, the employee requires to be retired, there is no right vested in the employee to continue in the employment after a prescribed age under the Rules - Much has been argued out by learned Senior Counsel appearing for the Petitioner that as the charges levelled against the Petitioner in departmental inquiry have been quashed, the decision of compulsory retirement dated 10.06.2019 is because of legal malice on the part of the Respondents. This contention of the Petitioner is devoid of any merits. Compulsory retirement has various facets. Compulsory retirement can be passed looking to the overall service record of the Government employee. Compulsory retirement order can also be passed in public interest with a view to improve efficiency of the administration or to weed out people of doubtful integrity or corrupt employee but sufficient evidence was not available to take disciplinary action in accordance with the rules, so as to inculcate a sense of discipline in the services - even if for this petitioner, the departmental charges have been quashed and set aside and the sanction granted for prosecution in two criminal cases have been quashed and set aside, still the Respondents can pass an order for compulsory retirement of the Petitioner. Looking to the Rule 56(j) of Fundamental Rules, from the very inception into the Government service till the age of 50 years there is enough and ample scope for the Government employee to improve his performance to prove is faithfulness and loyality to the Government, to make his services necessary in the Government, to make his services useful to the Government for rest of the years of his service. Government is taking the work from honest hands and dishonest hands - After a prescribed age of an employee, there is an assessment by the Government through Review Committee and if looking to the entire service record of the employee and looking to his performance and looking to his usefulness into the remaining services, if he is to be weeded out, the Union of India has all powers, jurisdiction and authority under Rule 56(j) of Fundamental Rules to make such employee compulsory retired, even if there is acquittal from some of the charges levelled against him by the Union of India. Looking to the conclusion arrived at by the Respondents of compulsorily retirement of the Petitioner, it cannot be said that the Respondents were driven by extraneous, malicious, perverse, unreasonable or arbitrary considerations - Proceedings under Rule 56(j) of Fundamental Rules is distinct and independent proceedings undertaken by the Respondents on the basis of the entire service record of the Petitioner and keeping in mind the performance of the Petitioner and his usefulness into the services. A subjective satisfaction has been arrived at by the Review Committee to compulsory retire the Petitioner. Even if the promotion has been granted to a Government employee he can be made compulsory retired under Rule 56(j) of Fundamental Rules. In the facts of the present case order under Rule 56(j) of Fundamental Rules has been passed before grant of promotion to the Petitioner - Petitioner has already been made compulsorily retired since 10.06.2019, i.e., approximately for the last 27 months, he is not into the services of the Government. Petition dismissed.

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• 2021 (10) TMI 38
  Quantum of penalty - wrongful adjustments of the amount deposited by the petitioner towards Tax Deducted at Source (TDS) recovered from various parties including the respondents - non-issuance of TDS certificates to the respondents - arbitrary action of the Income Tax Department which is pending adjudication before the Jammu and Kashmir High Court - HELD THAT:- The attempt of the petitioner throughout has been to delay execution proceedings by filing various petitions/applications on frivolous grounds. It has rightly been contended by the counsel for the respondents that the respondents are not concerned with the dispute between the petitioner and the Income Tax Department. If the TDS had been deducted by the petitioner from the payments made to the respondents, the petitioner is bound to furnish TDS certificates to the respondents. In the event the petitioner is unable to furnish TDS certificates, it would have to pay the said amounts to the petitioner. Nothing has been furnished by the petitioner to show that the amount deducted by it towards TDS has been deposited with the Income Tax Department. The petitioner has unjustifiably failed to make the payment of Rs. 5,60,000/- and Rs. 1,80,000/- to the respondents respectively, and it was only after the abovesaid order was passed by this Court on 1st September, 2021 that the said amounts have been paid to the respondents. The petitioner was well aware of the penalty imposed by the Executing Court by the impugned orders and despite the same, contested the same unsuccessfully for over two years. If the petitioner felt that the penalty being imposed was excessive, the petitioner should have challenged the impugned orders immediately. Petition dismissed.

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• 2021 (10) TMI 34
  Dishonor of Cheque - presumption under Section 139 of the Negotiable Instruments Act - Complainant is witness of truth and reliability or not - preponderance of probability - cross-examination of witnesses - burden to prove - HELD THAT:- Taking into the close dates between the parties and the date of the sale agreement with that of the date of the cheque, the lower appellate Court has rightly come to the conclusion that within a week, two sale agreements have been executed by wife of the accused and brother-in-law of the accused and marking of the documents D1 and D3, the accused has successfully demonstrated that various sale agreements, as a security, for this loan transaction was originally entered between the parties and the said amount of Rs. 3 lakhs, was duly repaid by two cheques dated 28.12.2011 and the same was duly honoured and further payment of Rs. 41,300/- was also duly honoured by payment of cheque and thus, the suggestive case of the defence has been successfully demonstrated by more than preponderance of probability from the answer elicited in the cross examination of P.W. 1 and D.W. 1 and D3 and D2 sale agreements and it is found that the complainant has not come to the Court with clean hands. The accused has successfully demonstrated the suggestive case. The cheque is a blank signed cheque for two sale agreements and there is another case filed by brother-in-law of the complainant in Puducherry area and in respect of the amount received, there are also duly repaid the amount by cheque, the same was duly encashed, as per admission of P.W. 1 in the cross examination and hence, the accused has successfully discharged the burden of proof by preponderance of probability by establishing that such a huge amount has not been given as a loan by the complainant and in view of such finding, it is again for the complainant to prove that he had source of income to lend such a huge amount of Rs. 20,00,000/- - Admittedly, he had not filed any document to show that he had possessed such huge amount of Rs. 20 lakhs. In the cross examination, he had categorically admitted that he had initially paid Rs. 1 lakh and subsequently, he has developed the corpus to lend Rs. 20 lakhs and he admitted that he had not disclosed the same in the income tax returns and for which, he has also paid income tax for the said amount. This Court finds that non mentioning of date on which and for how many months after giving the loan, he had received Ex. P1 cheque from the accused, assumes vital importance - after rebuttal of evidence, the pendulum of burden of proof, having oscillated towards the complainant, the complainant is duty bound to prove that there was a source of income to pay such amount he having failed, has to fail. The finding rendered by lower appellate Court is not perverse and the same do not suffer from any irregularity or illegality warranting interference in this appeal - Appeal dismissed.

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• 2021 (10) TMI 33
  Dishonor of cheque - pre-mature filing of complaint before expiry of the statutory period 15 days from the date of deemed service of the demand notice - insufficient fund or closure of the account prior to the deposit of the cheque - section 139 of N.I. Act - HELD THAT:- This Court is of the view that the presumption regarding service of demand notice sent even through registered cover can be drawn only upon expiry of 30 days from the date of dispatch of notice as has been held by the Hon ble Supreme Court in SUBODH S. SALASKAR VERSUS. JAYPRAKASH M. SHAH ANR [ 2008 (8) TMI 795 - SUPREME COURT] . In the said judgment the notice was sent through speed post and although the actual date of service of notice was not known, the Complainant proceeded on the basis that the same was served within the reasonable period. It was held that if the presumption of notice within the reasonable period is raised, the deemed service at best can be taken to be 30 days from the date of its issuance and the accused was required to make payment in terms of the said notice within 15 days thereafter and the complaint petition therefore could have been filed after expiry of 15 days given to the accused for payment of money after receipt of notice. This Court finds that the law has been well settled by the aforesaid judgment that the cause of action for filing a Complaint under Section 138 of the Negotiable Instruments Act cannot arise before expiry of 15 days from the date of service of notice upon the accused - this Court finds that in absence of the specific date regarding service of notice, the demand notice sent on 17.02.2006 under registered post would be deemed to be served upon the petitioner on 18.03.2006 i.e. only after expiry of 30 days from the date of issuance of the demand notice and the cause of action for filing the Complaint would have arisen on expiry of 15 days thereafter i.e. only after 02.04.2006 and the Complaint could have been filed thereafter, but the Complaint in the present case was filed on 17.03.2006. This Court is of the considered view that both the learned courts below have erred in holding that the Complaint was maintainable - this Court holds that the Complaint filed before expiry of the statutory period 15 days from the date of deemed service of the demand notice upon the petitioner regarding the dishonour of the cheques was premature in view of the fact that the cause of action for filing the Complaint had not arisen on 17.03.2006 and therefore, the Complaint itself was pre-matured and was not legally maintainable. The petitioner is acquitted on the ground that the complaint itself was pre-mature and consequently, he is discharged from the liability of his bail bond - the present criminal revision petition is hereby allowed.

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• 2021 (10) TMI 31
  Dishonor of Cheque - insufficiency of funds - continuation of criminal proceedings arising out of the complaint would result in miscarriage of justice - powers under Section 561-A Cr.PC. - HELD THAT:- The Trial court after having taken cognizance, recorded the statement of complainant and issued process against the accused for commission of offences punishable under Section 138 Negotiable Instruments Act as well as offences punishable under Sections 420, 323 and 506 RPC. What was required by the respondent to show before the court was that a cheque was issued by petitioner and the same was presented for encashment, the cheque was dishonoured and returned on account of insufficient funds or any other reason and notice of demand was made, but petitioner failed to pay. The respondent has alleged and shown that the cheque was issued in his favour for payment of Rs. 6.00 lacs and when the said cheque was presented for encashment before the bank within the period of validity of the cheque, the bank returned the cheque without making payment on the ground that drawee of the cheque was not having sufficient funds - The respondent has further alleged that in pursuance of demand notice, he also demanded the money of cheque from the petitioner, but petitioner/accused instead of making payment subjected him to beating, thrashing and also threatened him of dire consequences. This act of the petitioner is shown to have been done during the course of the same transaction. The cognizance of offences under Section 138 Negotiable Instruments Act, as well as Sections 420, 323 and 506 of Ranbir Penal Code taken by the Trial Court, is not bad because in view of provision as contained in Section 227 of the Cr.PC, trial of the cases in respect of the offences which have taken place during the course of same prosecution can be held together. The submission of the petitioner that the filing of complaint, its continuance and issuance of process amounts to abuse of the process of law, is without any basis. Nothing wrong can be found in the order passed by Trial court. The complaint and statements, do disclose the commission of offence punishable under section 138 Negotiable Instruments Act as well offences punishable under Sections 420, 323 and 520 Ranbir Penal Code. Petition dismissed.

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• 2021 (10) TMI 1
  Seeking grant of anticipatory bail - misconception and misunderstanding of Section 170, Code of Criminal Procedure - HELD THAT:- The circumstances under which the impugned order was passed and thereafter the Appellant approached this Court was noticed in the order dated 28.07.2021. What was stated was that as per the SOP in these difficult times, the Appellant was supposed to join virtually and when he sought to enter appearance, his request was declined by order dated 09.06.2021 by the Special Chief Judicial Magistrate (CBI), Bhubaneshwar predicated on the reasoning that he had not remained physically present. It is this order which had been upheld by the impugned judgment dated 09.07.2021. We thus protected the Appellant against arrest with the direction to continue to attend the trial Court proceedings virtually in the then prevalent scenario and as and when physical Courts start working, the proceedings would be attended physically. The general principles Under Section 170 Code of Criminal Procedure, the most apposite observations are in sub-para (v) of the High Court judgment in the context of an Accused in a non-bailable offence whose custody was not required during the period of investigation. In such a scenario, it is appropriate that the Accused is released on bail as the circumstances of his having not been arrested during investigation or not being produced in custody is itself sufficient to entitle him to be released on bail. The rationale has been succinctly set out that if a person has been enlarged and free for many years and has not even been arrested during investigation, to suddenly direct his arrest and to be incarcerated merely because charge sheet has been filed would be contrary to the governing principles for grant of bail. We could not agree more with this. The given factual scenario completely fits the aforesaid as the Appellant was never taken into custody during investigation. Suffice to say that it would be a fit case for the trial Court to grant bail to the Appellant on the next date on terms and conditions to its satisfaction - Appeal allowed.

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