TMI Tax Updates - e-Newsletter
February 5, 2025

Case Laws in this Newsletter:

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

Articles

1. DOSSIER ON UNION BUDGET- 2025

   By: Dr. Sanjiv Agarwal

2. Difference between Anti-Dumping Duty, Safeguard Duty, and Countervailing Duty (CVD).

   By: YAGAY andSUN

3. Trademark Challenges in the Digital Age: A Study of E-Commerce and Global Trade

   By: YAGAY andSUN

4. Changes under GST Law

   By: Bimal jain

5. Export of Goods from India: A Simple Guide

   By: Tushar Malik

6. WHETHER THE DATE OF DEFAULT CAN BE CHANGED AFTER FILING THE PETITION UNDER SECTION 7 OF THE INSOLVENY BANKRUPTCY CODE?

   By: DR.MARIAPPAN GOVINDARAJAN

7. The Rights of a Creator Under Copyright Act, 1957

   By: YAGAY andSUN

8. Tool available for Foreign Exchange Management(for Indian Exporter & Importers)

   By: YAGAY andSUN

9. Definition of a Well-Known Trademark in India

   By: YAGAY andSUN

News

1. GST Council to soon take decision on rates, number of slabs: FM Sitharaman

2. BMC presents its biggest-ever Rs 74,427 crore budget, no hike in taxes

3. Government Budget Initiatives to Boost Aquaculture Sector Growth; Kings Infra Well-Positioned to Leverage Opportunities

4. Budget non-inflationary, focuses on fiscal prudence; monetary policy should work in tandem: Fin Secy

5. Goa CM welcomes continuation of special assistance for capital investment

6. BMC allocates Rs 1000 cr for BEST bus services in FY 2025-26 budget

7. Non-inflationary budget to aid RBI in monetary easing: Finance Secy

8. BMC presents over Rs 74,000 crore budget for 2025-26

9. India pays $37.64 million to UN regular budget for 2025

10. Mumbai's civic body to present budget for 2025-26 on Tuesday

11. Raj CM Sharma hails PM, Railway minister for budget outlay

12. Haryana CM thanks PM Modi, Vaishnaw for large allocation in Budget for railway projects

13. Rs 4,641 crore allocated to Uttarakhand in Rail Budget: Vaishnaw

14. Centre allots Rs 2,716 for railways work to Himachal Pradesh in Union Budget 2025-26

15. Union Budget allocates Rs 9,417 crore for Railway projects in Andhra Pradesh

16. Substantial increase in budget allocation to states such as Delhi, Bihar, MP, others: Vaishnaw

17. Over Rs 7,300 crore allocation in Union Budget for rail development in Jharkhand: Vaishnaw

18. PM Sharif reiterates Pakistan's move towards economic growth

19. National Inaugural Event to Celebrate 75thYear of National Sample Survey (NSS) on 7th February 2025 at Vigyan Bhawan

20. ED seizes Rs 1,000-cr worth assets of Chennai-based firm in PMLA case

21. India to evaluate benefits of OECD's global tax deal post US walkout: Finance Secretary

22. Sri Lanka must unite to achieve economic freedom: Prez Dissanayake

23. IICA ORGANIZES A CUSTOMIZED THREE DAYS TRAINING AND CERTIFICATION PROGRAMME “ESG FOR BOARD MEMBERS” AT THE UNITED NATIONS REGIONAL OFFICE FOR ASIA AND PACIFIC, BANGKOK, THAILAND

24. Trump agrees to pause tariffs on Mexico, but import taxes still in place for Canada, China

Notifications

DGFT

1. 56/2024-25 - dated 4-2-2025 - FTP

Amendment in Export Policy of De-Oiled Rice Bran

Circulars / Instructions / Orders

Income Tax

1. F. No. 225/235/2024/ITA-II - dated 31-1-2025

Order under section 138(1)(a) of the Income-tax Act, 1961

DGFT

2. 45/2024-25 - dated 4-2-2025

Amendment in 4.59 of Handbook of Procedures, 2023 and modification in Standard Input Output Norms (SION) M- 1 to M-8 for export of jewellery

Highlights / Catch Notes

GST

• Provisional Bank Account Attachment Under GST Section 83 Quashed Due To Insufficient Evidence And Reasoning

  Case-Laws - HC : HC invalidated provisional attachment of petitioner's bank account under Section 83 of MGST Act 2017. Court emphasized the draconian nature of provisional attachment powers, requiring strict fulfillment of statutory conditions and proper formation of Commissioner's opinion to protect revenue interests. The Joint Commissioner's order failed to demonstrate adequate material basis for concluding petitioner would defeat potential tax demands. The mere reference to GST Council's recommended amendment regarding "plant and machinery" terminology in Section 17(5)(d) was insufficient justification. Court found the attachment unjustified due to lack of substantive reasoning and evidentiary support. Petition disposed of with attachment order quashed.
  Visit to Get Source

  ---

• Transition of CENVAT Credits to GST Cannot Be Denied Based on Previous Law's Ineligibility Rules

  Case-Laws - HC : HC held that CENVAT credit transition from JVAT Act to JGST Act cannot be denied based on ineligibility under the repealed law. Following precedent in prior case, court determined GST authorities lack jurisdiction to adjudicate eligibility of credits under former regime. Credits' eligibility must be evaluated under provisions of erstwhile Act. The impugned adjudication order and subsequent appellate order were quashed, allowing petitioner's transition of input tax credits into GST system. This ruling affirms that migration to GST cannot be blocked solely due to disputed credit eligibility under previous tax framework.
  Visit to Get Source

  ---

• Tax Demand Stayed: Interim Relief Granted with 10% Payment Condition Under Section 107(6) for Non-Operational Tribunal Case

  Case-Laws - HC : HC granted interim stay on tax demand following appeal disposal, acknowledging non-operational status of Appellate Tribunal. Initial two-week unconditional stay granted, with extension contingent on petitioner's payment of 10% of disputed tax balance, supplementing previous Section 107(6) deposits. Stay continuation linked to either writ petition resolution or subsequent orders. Court directed filing of affidavit-in-opposition within six weeks, allowing one week for reply. Decision balanced taxpayer protection with revenue interests while addressing procedural gap due to pending Tribunal establishment.
  Visit to Get Source

  ---

• Pre-packaged Food Sales Without Service Elements Not Eligible for Restaurant Service GST Rate Under SAC 996331

  Case-Laws - AAAR : The AAAR determined that sale of readily available food and beverages not prepared in restaurant premises, whether consumed on-site or taken away, does not constitute 'restaurant service' under SAC 996331. The ruling established that restaurant service requires a composite supply where food/beverage provision is bundled with service elements. The authority emphasized that per Schedule-II clause 6(b) read with Section 7(1A), mere sale of pre-packaged food items without accompanying services represents pure supply of goods, not restaurant service. Consequently, such transactions attract applicable GST rates for goods rather than the concessional rate available for restaurant services under Notification No. 11/2017-Central Tax (Rate) and corresponding State notifications.
  Visit to Get Source

  ---

• DOMS A1 Pencils Bundled with Sharpener Classified as Mixed Supply Under Section 8(b), Attracting 12% GST Rate

  Case-Laws - AAAR : AAAR determined that supply of DOMS A1 pencils with sharpener constitutes a mixed supply under CGST Act, 2017, not a composite supply, as items are not naturally bundled or supplied in conjunction during ordinary business. The appellant's argument to apply General Interpretative Rules (GIR) for classification was rejected as Section 8(b) of CGST Act prevails when unambiguous. For mixed supplies, the HSN code attracting higher tax rate among component supplies (8214, 9608, or 9609) applies. Consequently, the supply attracts 12% tax rate based on the highest applicable rate among individual components. Appeal dismissed.
  Visit to Get Source

  ---

Income Tax

• Tax Refund of Rs. 24.83 Lakhs Approved Without Interest Due to Delayed Filing Beyond Six-Year Limitation Period

  Case-Laws - HC : HC ruled against granting interest on delayed tax refund while upholding the refund claim itself. The respondent's application for condonation of delay, filed on 25.07.2016, was deemed time-barred as it exceeded the six-year limitation period from assessment year 2008-09, which expired on 31.03.2015. Per Instruction No.13/2006, refund claims below Rs. 50 lakhs require filing within six years from the relevant assessment year's end. While the court directed processing of the Rs. 24,83,851 refund amount, it set aside the Single Judge's order regarding interest payment, noting that interest applies only for delays attributable to the revenue authorities, not for taxpayer's delay in filing.
  Visit to Get Source

  ---

• CBDT Circular on Foreign Income Tax Refunds Struck Down for Overstepping Section 119 Powers in FCCB Cases

  Case-Laws - HC : HC invalidated CBDT Circular No. 07/2007's paragraph 9 as ultra vires, ruling it exceeded powers under Section 119. Court found refund applications for excess tax deducted under Section 195 were wrongly rejected on limitation grounds. Following S.A. Builders precedent on commercial expediency, HC determined that borrowings through FCCBs and ECBs used for overseas holding company qualified as debt incurred for earning foreign income. The expenditure met commercial expediency test as investments were motivated by expectation of foreign source income. Court directed refund of excess taxes deposited for FY 2010-11 to 2012-13, rejecting revenue's interpretation of Section 9(1)(v)(b) as unsustainable.
  Visit to Get Source

  ---

• Invalid Notice Under Section 143(2) to Deceased Person Voids Assessment Despite Legal Heirs' Participation

  Case-Laws - AT : ITAT ruled that notice under section 143(2) issued in the name of deceased assessee Smt. S was invalid, despite participation of legal heirs in assessment proceedings. The tribunal rejected Revenue's reliance on section 292BB, clarifying that its provisions apply only to living assessees, not their legal heirs. The assessment order based on defective notice was held void ab initio. The tribunal emphasized that mere participation of legal representatives cannot cure jurisdictional defect of notice issued to deceased person. Assessment proceedings conducted pursuant to invalid notice were set aside, with tribunal ruling in favor of assessee's legal heirs.
  Visit to Get Source

  ---

• Tax Additions Under Section 69 Rejected: Cash Loans and Interest Claims Invalid Without Corroborative Evidence

  Case-Laws - AT : ITAT ruled against additions made under section 69 for alleged cash loans and notional interest. The additions were based solely on documents seized during third-party premises search and statements under section 132(4), which were later retracted claiming duress. Despite concurrent searches at appellant's premises, no incriminating evidence was found to support alleged cash transactions. The absence of promissory notes or other documentation for substantial loan amounts was deemed improbable. ITAT held that Assessing Officer failed to gather corroborative evidence beyond seized materials and third-party statements. The tribunal concluded additions for unexplained investments and notional interest were unsustainable without cogent evidence, ruling in appellant's favor.
  Visit to Get Source

  ---

• Assessment Order Invalid: Service After December 31 Deadline Voids Proceedings Under Section 153 Despite Earlier Order Date

  Case-Laws - AT : ITAT determined assessment order under sections 263/143(3)/147 was time-barred and invalid. Though AO passed order on 30.12.2015, it was served to assessee on 05.01.2016, beyond statutory deadline of 31.12.2015 per Section 153. AO's subsequent clarification citing 30.12.2015 as order date conflicted with claimed execution date of 31.12.2015. Despite intervening weekend holidays, failure to serve within limitation period rendered order non-est and void ab initio. Tribunal upheld assessee's appeal, declaring assessment proceedings legally invalid due to service beyond prescribed limitation period.
  Visit to Get Source

  ---

• Alternative Accommodation Charges to SRA Tenants Not Subject to TDS Under Section 194-IC as Property Share Compensation

  Case-Laws - AT : ITAT ruled that alternative accommodation charges paid to tenants under SRA scheme do not constitute consideration for share in land/building under development agreement. Following precedent in Nathani Parekh Construction case, tribunal held such payments categorized as 'Rent to Tenant SRA' fall outside scope of TDS provisions under section 194-IC. CIT(A)'s order deleting tax and interest levied under sections 201(1) and 201(1A) upheld. The ruling clarifies that temporary accommodation expenses during redevelopment are distinct from property share compensation, exempting them from TDS requirements. Appeal resolved in taxpayer's favor.
  Visit to Get Source

  ---

• Section 68 Additions Invalid: No Books of Accounts Maintained Makes Unexplained Cash Credit Provisions Inapplicable to Losses

  Case-Laws - AT : ITAT ruled that additions under section 68 were invalid as the assessee had not maintained books of accounts, making the provision inapplicable. The Tribunal noted that since no amount was found credited in any books of account, the AO's addition under section 68 was unsustainable. Additionally, the CIT(A) erroneously applied section 69A instead of section 68 in their appellate order, rendering the decision legally flawed. The assessee had actually incurred losses rather than gains. The Tribunal's decision emphasized that section 68 specifically requires the existence of books of accounts and credited entries therein. Appeal decided in favor of the assessee.
  Visit to Get Source

  ---

Customs

• Customs Broker Penalty Deleted Due to Lack of Evidence Under Regulation 18 CBLR for Alleged Non-Compliance

  Case-Laws - AT : CESTAT held that penalty under Regulation 18 of CBLR 2013 requires establishing violations under grounds (a), (b), or (c) through documentary evidence. While the Authority has discretionary power to impose penalties up to 50,000 for regulatory non-compliance or misconduct, the Inquiry Report was found inconclusive and the Commissioner failed to demonstrate specific violations. The Tribunal noted that Regulation 18 provides for either license revocation or penalty imposition, not both. Despite the Authority's jurisdictional competence to determine appropriate sanctions, the lack of substantiated evidence linking the Customs Broker's actions to prescribed violations warranted deletion of the penalty. Revenue's appeal was accordingly dismissed.
  Visit to Get Source

  ---

• Customs Duty Refund Claims Valid Under Section 128: Time Limitation Starts From Supreme Court's ITC Limited Judgment

  Case-Laws - HC : HC ruled in favor of the appellant regarding customs duty refund claims from 2014-2015. While initial refunds were granted, subsequent litigation reached SC, which established in ITC Limited case that refunds require modified assessment orders under Section 128 of Customs Act. HC determined appeals were timely filed within 90 days of ITC judgment. The court rejected the limitation argument, considering Section 14 applicable since ITC fundamentally changed refund basis. Delay was deemed condonable given the legal evolution of refund requirements through judicial precedents. The court emphasized that previous adjudication had not raised timing issues between bills of entry and refund applications, making that period irrelevant for current appeal timing calculations.
  Visit to Get Source

  ---

• Classification of Lauric Acid Under Section 29159090 Upheld Despite Challenge to Original Tariff Classification Decision

  Case-Laws - AT : CESTAT upheld the re-classification of Lauric Acid under Tariff Item 29159090, rejecting appellant's declared classification. The tribunal determined that the imported goods did not qualify as either a salt or ester of Palmitic or Stearic Acid under subheading 2915.70. The ruling emphasized that tariff 2915 7090 specifically pertains to Palmitic and Stearic acids, their salts and esters, and cannot be extended to include other saturated fatty acids. The appellant's reliance on an undocumented opinion, without supporting evidence, failed to counter the original classification findings. The appeal was dismissed, confirming the authorities' re-classification decision.
  Visit to Get Source

  ---

• Mobile Phone Components: Receivers, Microphones, Connectors, and Covers Classification Under CTH 85177090 and Related Exemptions

  Case-Laws - AT : CESTAT ruled on classification disputes for various mobile phone components. The Tribunal held that Receivers should be classified under CTH 85177090 as phone parts, not standalone audio equipment under CTH 8518. Microphones were denied exemption under N/N. 57/2017-Cus. Connectors qualified for exemption benefits and were classified under CTH 85369090. Various covers and assemblies (Rear Cover, Front Housing, Camera Lens etc.) were deemed eligible for exemption under N/N. 50/2017 and classified under CTH 85177090 as cellular phone parts. The Tribunal emphasized that parts integral to phone functionality should be classified as phone components rather than standalone devices. Extended period limitations were rejected where genuine interpretative issues existed, restricting demands to normal period with applicable interest.
  Visit to Get Source

  ---

IBC

• Personal Guarantor's Challenge to PIRP Under Section 95 Fails as Security Trustee's Actions Deemed Valid for Lenders

  Case-Laws - AT : NCLAT dismissed the appeal challenging the initiation of Personal Insolvency Resolution Process (PIRP) against a personal guarantor. The tribunal found that the Section 95 application was filed within limitation period, ending 21.08.2021. Despite no direct privity of contract between SBI and guarantor, the security trustee's actions were valid as they acted for lenders' benefit per the Master Restructuring Agreement. The debt was deemed crystallized upon execution of personal guarantee in 2015, with established default. Claims regarding undervaluation of corporate debtor's subsidiary shares and absence of Section 100(2) directions for negotiations were rejected. The tribunal upheld the maintainability of the PIRP petition, confirming creditor's right to enforce personal guarantee through security trustee arrangement.
  Visit to Get Source

  ---

PMLA

• Bank Lockers and Gold Already Under CBI Cannot Be Re-seized Under PMLA Section 17(1) for Money Laundering Investigation

  Case-Laws - AT : AT ruled against double seizure of bank lockers and gold in a money laundering case. The lockers (no. 86 and 96) were already under CBI custody, making subsequent seizure under PMLA Section 17(1) unjustified as there was no risk of concealment. Regarding 3.2kg gold, seizure was invalidated based on CBDT guidelines allowing women to possess specified quantities (500g for married, 250g for unmarried). AT held that properties under one authority's seizure cannot be re-seized by another unless released by the initial authority. The respondent retains right to fresh seizure upon CBI's release. The impugned order was partially modified, and appeal disposed of accordingly.
  Visit to Get Source

  ---

• Teacher Recruitment Scam: PMLA Section 5 Attachment Order Upheld as Directors Fail to Justify Suspicious Bank Transactions

  Case-Laws - AT : AT upheld provisional attachment order of bank accounts in money laundering case involving unfair teacher recruitment. Investigation revealed unexplained large transactions and suspicious fund transfers in accounts of SKP Enterprises. Directors except appellant were found to be dummy, with 10% shareholder making disproportionate transfers. Appellant failed to justify transactions or provide legitimate business documentation. Violations established under Prevention of Corruption Act and IPC sections covering corruption, cheating, and forgery. Court found sufficient grounds under PMLA 2002 to maintain attachment given unexplained financial flows and connection to proceeds of corrupt recruitment practices. Appeal dismissed due to lack of evidence showing legitimate fund sources.
  Visit to Get Source

  ---

VAT

• Entry Tax Act and Finance Act 2017 Amendments Upheld as Valid, Non-Discriminatory Following Jindal Stainless Precedent

  Case-Laws - HC : HC upheld the validity of West Bengal Tax on Entry of Goods into Local Areas Act 2012 and its subsequent amendments through West Bengal Finance Act 2017. Following Jindal Stainless Ltd precedent, the court set aside an earlier Single Judge order that had relied on now-overruled decisions (Atiabari, Automobile Transport, Jindal Steel). The court determined the Entry Tax Act remained in force during its 2017 amendment and found the amendments neither invalid nor discriminatory. The retrospective amendments did not unlawfully deprive assessees of accrued benefits. Notably, interim arrangements allowing tax assessments to continue remained effective throughout the proceedings. The court ultimately disposed of the writ petitions by setting aside the Tribunal's order.
  Visit to Get Source

  ---

• Entry Tax Assessment Orders From 2003-04 Quashed Due to 18-Year Delay Under Rule 4(1)

  Case-Laws - HC : HC ruled on belated assessment orders under Entry Tax Act 2001 for AY 2003-04 and 2004-05. Though no explicit limitation period exists, assessments must be completed within reasonable time. Entry Tax Act operates in conjunction with TNGST Act 1959 and later TNVAT Act 2006. Rule 4(1) mandates single-order assessment after year-end. Department's 2021 orders for AY 2003-04 and 2004-05 were unjustifiably delayed. Court held returns filed by petitioner deemed assessed under Rule 4(1), and any reassessment powers should have been exercised within 5 years of deemed assessment. Impugned orders set aside, petition allowed.
  Visit to Get Source

  ---

Service Tax

• Directors Cannot Be Personally Liable For Company's Service Tax Dues Under Finance Act 1994; SVLDRS Declaration Category Error Correctable

  Case-Laws - HC : HC determined the petitioner's declaration under SVLDRS-2019 was incorrectly filed under "litigation category" instead of "Amount in Arrears Category." While the discharge certificate cannot be revoked under Section 129(2)(c), the Designated Authority has powers to correct mistakes if misled by improper declarations. The court found no legal provision under Finance Act 1994 allowing recovery of company's tax dues from directors' personal accounts, thus quashing the bank account attachment order. The recovered amount of Rs. 22,00,000 can be adjusted against deficit amount subject to director's consent. Petitioner remains eligible for relief under Section 124(1)(c)(ii) rather than 124(1)(a)(ii), contingent upon payment of correct amount with interest.
  Visit to Get Source

  ---

• Service Tax Wrongly Collected on Construction Services Before July 2010 Must Be Refunded Under Section 65(105)(zza)

  Case-Laws - AT : CESTAT allowed refund claims for service tax wrongly collected and paid on 'construction of complex' services during September 2008 to May 2010. Following KVR Construction precedent, the tribunal held that amounts paid under mistaken notion cannot be classified as service tax when no legal obligation existed. The limitation period under Section 11B of Central Excise Act 1944 was deemed inapplicable as the payment did not constitute legitimate service tax. The tribunal overturned the lower authorities' rejection of refund claims based on time limitation, affirming that service tax was not leviable on construction services prior to July 1, 2010, per the explanation to Section 65(105)(zza) of Finance Act, 1994.
  Visit to Get Source

  ---

Case Laws:

• GST

• 2025 (2) TMI 134
  Provisional attachment of the Petitioner s bank account under Section 83 of the MGST Act, 2017 - HELD THAT:- The power to order provisional attachment of a property of a taxable person [including a bank account] under Section 83 is draconian in nature and the conditions which are prescribed in the statute for the aforesaid exercise of power must be strictly fulfilled. The exercise of the power for ordering a provisional attachment must be preceded by the formation of an opinion of the Commissioner that it is necessary so to do for the purpose of protecting the interest of the revenue. The impugned order proceeds on the basis that the GST Council has also recommended amendment to the words plant and machinery instead of plant or machinery in Section 17 (5) (d), in light of the Judgment passed by the Hon ble Supreme Court in Safari Retreats [ 2024 (10) TMI 286 - SUPREME COURT] . In one sweeping line, the Joint Commissioner of State Tax has come to the conclusion that in order to protect the interest of the revenue, he is exercising powers under Section 83. What was the material available to him to form an opinion that the assessee (the Petitioner) is likely is to defeat the demand, if any, is nowhere mentioned and is nowhere on record. Conclusion - The provisional attachment of the Petitioner s bank account was unjustified due to the absence of necessary material and reasoning. Petition disposed off.

  ---

• 2025 (2) TMI 133
  Transition of input tax credit from the Jharkhand Value Added Tax Act, 2005 (JVAT Act) to the Jharkhand Goods and Services Tax Act, 2017 (JGST Act) - eligibility of CENVAT credit/Input Tax Credit - HELD THAT:- Te issue involved in the instant writ petition is covered by a coordinate Bench of this Court in the case of Usha Martin Limited [ 2022 (11) TMI 1266 - JHARKHAND HIGH COURT ] where it was held that the eligibility of CENVAT credit under the erstwhile Act should be adjudicated under the provisions of that Act, and migration to the GST regime cannot be denied merely because certain credits were ineligible under the repealed Act. Conclusion - The transition of CENVAT credit under the GST regime cannot be denied based on its eligibility under the repealed Act, as this falls outside the jurisdiction of the GST authorities. The instant writ petition is disposed of in terms of the order dated 10th November, 2022 passed in the case of Usha Martin Limited and the impugned adjudication Order dated 08.01.2018 (Annexure-9) and the Appellate Order dated 13.12.2019 (Annexure-15) are, hereby, quashed and set aside. Application disposed off.

  ---

• 2025 (2) TMI 132
  Recovery of outstanding dues - applicability and interpretation of Circular No. 224/18/2024-GST issued by the Ministry of Finance concerning the recovery of outstanding dues when the first appeal has been disposed of, and the Appellate Tribunal is not yet operational - Revenue submits that the writ petition may be heard on the usual terms provided under Section 112(8) of CGST Act - HELD THAT:- Having considered the materials on record as also taking note of the fact that the Appellate Tribunal is yet to be constituted, it is opined that the petition should be heard. Since, the petitioner has been able to make out a prima facie case, there shall be an unconditional stay of the demand of the Appellate order dated 10th September, 2024, for a period of two weeks from date. In the event, the petitioner makes payment of 10% of the balance amount of tax in dispute, in addition to the amount already deposited in terms of Section 107(6) of the said Act, within two weeks from date, the interim order passed herein, shall continue till the disposal of the writ petition or until further order, whichever is earlier - Let affidavit-in-opposition to the present writ petition be filed within a period of six weeks from date, reply, if any, be filed within one week thereafter.

  ---

• 2025 (2) TMI 131
  Challenge to section 174 (2) of the GST Act, 2017 - HELD THAT:- Both the counsel are ad idem that the issue involved in the present petition stands finally adjudicated by this Court in TECNIMONT SPA INDIA PROJECT OFFICE, M/S SADHIL ENTERPRISES PVT. LTD., M/S KHOSLA AGRO OVERSEAS, M/S HORIZON GLOBAL LIMITED, M/S SHARMA TRADING CO., M/S SHIV SHAKTI TRADING CO., M/S. THE BUDHLADA CO-OPERATIVE SUGAR MILLS LTD., STEEL MART, KOHINOOR AGRO FOODS VERSUS STATE OF PUNJAB AND ANOTHER, STATE OF HARYANA AND OTHERS, UNION OF INDIA AND ANOTHER, UNION TERRITORY OF CHANDIGARH AND ANOTHER. [ 2024 (12) TMI 1223 - PUNJAB AND HARYANA HIGH COURT ], wherein, it was held that The challenge to section 174 (2) of the GST Act, 2017 would be subject to the final outcome of the decision in the case of T.S. BELARAMAN VERSUS THE COMMERCIAL TAX OFFICER ORS. [ 2024 (5) TMI 1498 - SC ORDER] . The observations and order passed above shall apply mutatis mutandis to the present case - petition disposed off.

  ---

• 2025 (2) TMI 130
  Cancellation of the GST registration of the petitioner firm - failure to furnish returns for a continuous period of six months - failure on account of health issues of petitioner - HELD THAT:- In the present case, the petitioner has not filed returns for a continuous period of six months, for which, the GST Registration of the petitioner s firm was cancelled. Due to ill-health, the monthly returns have not been filed by the petitioner and without considering this aspect, the respondent has cancelled the GST Registration, which caused great hardship to the petitioner in filing the returns as well as for payment of tax dues. Therefore, it would cause loss for both the petitioner and the respondent. Hence, this Court is inclined to set aside the impugned order and revoke the cancellation of GST Registration passed by the respondent. The respondent shall take suitable steps by instructing GST Network, New Delhi to make suitable changes in the architecture of the GST Web portal to allow the petitioner to file the returns and to pay the tax/penalty/fine, within a period of four weeks from the date of receipt of a copy of this order. Petition disposed off.

  ---

• 2025 (2) TMI 129
  Classification of supply - restaurant services or not - readily available food and beverages (not prepared in the restaurant) sold over the counter by the Applicant to the customer whether consumed in the restaurant or by way of takeaway - classifiable under SAC 996331 or not - applicability of Sr. No. 7 (ii) of Notification No. 11/2017 - Central Tax (Rate) dated June 28, 2017, read with Sr. No.7(ii) of Notification No. 11/2017 - State Tax (Rate) dated June 30, 2017. HELD THAT:- The definition of restaurant service , means supply of goods viz food/beverages, etc fit for human consumption, provided by a restaurant/eating joint including mess, canteen, by way of or as part of any service, irrespective of whether it is consumed at the restaurant premises or otherwise. Now, clause 6(b) of schedule-II, read with section 7(1A), ibid, in a similarly worded sub-clause, mentions activity of supply of food articles by way of or as part of any service, as supply of service. The reason for undertaking a conjoint reading of both the definition and clause 6(b) of schedule-II, is to highlight the fact that to fall within the ambit of restaurant service , the pivotal factor is that the supply of food has to be a composite supply along with the supply of service. It goes without saying that sans supply of service, a supply of goods being food/beverages, fit for human consumption, is a case of pure supply of goods. Conclusion - The sale of readily available food and beverages not prepared in the restaurant is a supply of goods and subject to the applicable GST rate, not qualifying as restaurant services.

  ---

• 2025 (2) TMI 128
  Classification of supply - composite supply or mixed supply - supply of pencils sharpener along with pencils being principal supply - HSN Code - rate of tax - HELD THAT:- The CGST Act, defines a composite/mixed supply. Additionally, CGST Act, 2017, thereafter, specifies the tax liability in such case wherein a supply falls within the ambit of either a composite/mixed supply. It is already held that the product DOMS A1 pencil , is a mixed supply, the product not being naturally bundled, not having a principal supply and not supplied in conjunction with each other in the ordinary course of business. Now, for the sake of argument, even if it is required to examine the claim of the appellant, it is found that the product of the applicant, in question, would not fall either within Rule 3(a) or 3(b) of the GIR, leaving with the only alternative of resorting to Rule 3(c). The question then which would arise is whether Rule 3(c) of the GRI or Section 8(b), of the CGST Act, 2017, would prevail. It is a trite law that when the section is unambiguous, the averment of the appellant to take the assistance GRI for deciding the nature of supply, classification and rate of tax, is not legally tenable. This submission of the appellant is rejected. Conclusion - i) The supply of pencils sharpener along with pencils under product DOMS A1 is covered under the category of mixed supply . ii) Since it is a mixed supply, the HSN code of the supply which attracts the higher rate of tax among all the taxable supplies contained in product DOMS A1, is required to be used. iii) The supply of the sharpener along with the kit having a nominal value will have an impact on rate of tax. The rate of tax will be 12% and the HSN code, in respect of mixed supply fie product DOMS A1] will be the supply which attracts the higher rate of tax among all the three supplies ie 8214 or 9608 or 9609. Appeal rejected.

  ---

• Income Tax

• 2025 (2) TMI 127
  Rejection of refund of excess tax wrongly deducted and deposited u/s 195 - Whether applications were barred by time? - HELD THAT:- The decision of the Court in Vikram Singh [ 2017 (4) TMI 621 - DELHI HIGH COURT] is of significant import insofar as the powers of the CBDT are concerned in light of the Court holding that the Board does not have the power to prescribe mandates or instructions that run afoul of the contours of the statutory provision concerned. Applying the said principles in the context of the present case, it becomes evident that paragraph 9 of Circular No. 07/2007 cannot be sustained absent a specific provision in the Act disentitling a person from claiming refund of tax erroneously withheld. The prescription so introduced by the CBDT is clearly ultra vires and beyond the power which Section 119 sought to confer upon that entity. Limitation period as prescribed could not have imposed impediments upon the sustainability of the petitioners application for refund. We also and in this regard bear in consideration, the undisputed fact of the applications for refund having been originally made way back in 2014. Those applications ultimately came to be rejected after a lapse of more than three years on 27 March 2018. It is manifest that the stand as taken by the respondents is clearly rendered unjust and arbitrary. View as expressed by the respondents based on Section 9 (1) (v)(b) - The respondent has taken the view that the interest burden which was borne by the petitioner could not be said to be one incurred for the purposes of a business carried on outside India or for earning income from a source outside India. The view so taken is rendered wholly unsustainable when tested on the salient principles which had come to be propounded by the Supreme Court in S.A. Builders [ 2006 (12) TMI 82 - SUPREME COURT ] To recall, in S.A. Builders, the Supreme Court had enunciated the precept of commercial expediency and thus any expenditure that may be incurred by a person as a prudent businessmen qualifying for deduction. It was thus observed that for the purposes of claiming it as a deduction, the assessee would not be obliged to establish that it was incurred under a legal obligation which applied. It was further held that even if a third party benefited from such an expense, the same would not warrant the expenditure being disallowed. S.A. Builders was a case where the money borrowed had been advanced as an interest free loan to the sister concern of the appellant before the Supreme Court. This too, as the Supreme Court held, was irrelevant since the advance so made was clearly entitled to be viewed as a measure adopted and motivated by commercial expediency. It is the view so expressed in S.A. Builders which has been consistently reiterated by the Supreme Court including in some of the decisions which were cited for our consideration by Mr. Vohra and which included Hero Cycles, as noticed by us in the preceding parts of this decision. A holding entity would undeniably have an enduring interest in the business prospects and performance of a related entity. Any advances made or liabilities taken over would thus clearly qualify the test of commercial expediency unless it be found to be a case of an illegal diversion or funnelling of funds. Undisputedly, the revenues generated from the issuance of FCCBs as well as the ECBs were utilized exclusively for the benefits of RNBV which, to recall, was the holding company of Terapia, S.A. The liability so taken over by the petitioner thus clearly fell within the ambit of a debt incurred as well as moneys borrowed and used for the purposes of making or earning income from a source outside India. The expected source of income and which was envisaged to accrue would clearly arise from the activities undertaken by Terapia, S.A. The investment was thus clearly motivated by the expectation of making or earning income from a source outside India. We find ourselves unable to sustain the order impugned before us. Allow the instant writ petition. We declare paragraph 9 of the CBDT Circular No. 07/2007 dated 23 October 2007 to be ultra vires the Act and hold that the applications for refund were wrongly rejected as being barred by time. We, quash the impugned order and consequently declare the petitioner eligible for refund of excess taxes deposited by it under Section 195 for FY 2010-11 to 2012-13.

  ---

• 2025 (2) TMI 126
  Condonation of delay in filing a revised income tax return and the entitlement to a refund with interest - Single Judge directing the appellants to consider the claim of the respondent for refund with applicable interest, if any - HELD THAT:- In the case in hand, the refund being Rs. 24,83,851/- which is less than Rs. 50,00,000/-, surely an application for refund was required to be filed within six years from the end of the assessment year for which the application/claim is made. The assessment year in the present case being 2008-09, the six years started running with effect from 01.04.2009, and expired on 31.03.2015 and in that sense, the respondent could not have filed application seeking condonation of delay after 31.03.2015. The application having been filed only on 25.07.2016, which is beyond the time of limitation as prescribed by the above instruction No.13/2006, the communication dated 05.07.2018, which was the subject matter of challenge in the writ petition is justified. Surely in the facts, the respondent cannot be given the benefit of his own wrong though the claim for refund even if genuine and bonafide, but surely the direction for grant of applicable interest, if any, could not have been directed. This is for the reason, the interest is payable for the delay attributed to the opposite party. In this case, despite the instruction dated 22.12.2006 stipulates filing of application seeking condonation of delay, the same having not been filed till 31.03.2015, but only on 25.07.2016, was rightly rejected by the appellants. So, the instruction contemplates, any claim for refund, within six years from the end of the assessment year for which the application/claim is made, necessarily has to be with an application for condonation of delay, which claim/refund has arisen as a result of excess tax deducted/collected at source. Hence, the order of learned Single Judge to the extent claim of the respondent was to be considered with interest, is set aside. It is made clear that the appellant shall consider the claim for refund of the respondent as directed by the learned Single Judge within four weeks from today, if not already implemented.

  ---

• 2025 (2) TMI 125
  Non service of notice u/s 143(2) - statutory period to issue the notice - lack of proper notice and opportunity to the assessee - HELD THAT:- The relevant A.Y. is 2012-13 and statutory period of six months from the end of the relevant A.Y. expires on 30.09.2013 and as per law valid notice u/s 143(2) supposed to issued on or before 30.09.2013 enabling the AO to proceed with the assessment u/s 143(3) of the Act. Second notice u/s 143(2) dated 07.01.2015 has no value in the eye of the law as having been issued after prescribed period for this purpose and so far notice u/s 143(2) is concerned, it was returned undelivered by postal remarks wherein landlord informed that any company with this name does not exist on this address) which was sent to assessee s registered address on 26.09.2013, and thereafter and before dated 30.09.2013, no any other notice u/s 143(2) was issued or served as per law. As no steps were taken to serve the notice in even alternative mode and also assessee / appellant submitted affidavit containing facts of that effect before the Ld. AO in the assessment proceedings but the Ld. AO completed the assessment without disposing the objection regarding question of valid service. As no notice u/s 143(2) was duely served upon the assessee / appellant on or before 30.09.2013, hence requirement of law not been fulfilled. Decided in favour of assessee.

  ---

• 2025 (2) TMI 124
  Addition u/s 68 - unexplained credit - AR has submitted no cash / cheque consideration was received by the assessee on issue of shares as it is case of swapping / exchange of shares - HELD THAT:-There appears to be no error in the findings of the ld CIT(A) as admittedly no credit entry of cash has been made in the relevant Assessment Year. AO seems to have not at all cared to examine the nature of transaction of the assessee and concluded that assessee has received money. Admittedly during the relevant year no cash was actually infused in the fund flow of company. There was mere dressing of capital and investments by swapping of shares for the investments of other companies received as consideration in lieu of the shares issues at premium. Which though may be effecting the value of liquid assets held by assessee at the end of year and increase in capital, but same cannot be equated with cash credits and sum permitted to be taxed as deemed income u/s 68. Since no cash was involved in transaction of said allotment of shares, conversion of these liabilities into share capital and share premium could not be treated as unexplained cash credits u/s 68 of the IT Act. Even if the allegation is of sham companies being operated by the assessee to channelize its unaccounted money into books of the assessee, then, for the year under consideration as observed above, no funds were actually received. The premium shown to be charged is not received as a sum credited in the books of account so as to be ultimately used during the year. If the case of the AO is accepted, then also, at the time of liquidation of the investments received as consideration of the share capital and share premium could be examined when actually received, which was not the case of the Department so far. Decided in favour of assessee.

  ---

• 2025 (2) TMI 123
  Notice u/s 143(3) issued in the name of dead person - Scope of provision of Section 292BB - participation of legal heirs - HELD THAT:- Since as on the date of issuance of notice u/s 143(2) of the Act, the Assessee Smt. Sunita Gupta was no more, therefore, the said notice issued 143 (2) of the Act cannot be construed to have been served on the Assessee. Contention of DR that the notice addressed in the name of the Assessee has been received by the legal representative of the Assessee and the legal representative has participated and co-operated in the assessment, therefore, as per Section 292BB the legal heir of the Assessee cannot raised the said ground of issuance of notice in the name of dead person in this belated stage. The said contention of DR cannot be agreeable, as it is well settled law that the provisions of Section 292BB are applicable only to the Assessee, but not to the legal heirs of the Assessee. Therefore, the Department of Revenue cannot take shelter under the provision of Section 292BB. Thus, AO committed grave error in issuing notice u/s 143(2) in the name of deceased Assessee and also committed error in framing the assessment based on the said defective notice. Decided in favour of assessee.

  ---

• 2025 (2) TMI 122
  Addition u/s 69A - unaccounted sales/cash transactions - Based on incriminating evidence obtained during the search, DGCEI concluded that assessee had made unaccounted sales and received sale consideration in cash - AO rejected the assessee s statements and relied on corroborative evidence such as seized materials, third-party statements, and judicial precedents to justify the addition under Section 69A - CIT(A) upheld the existence of unaccounted sales but restricted the addition to 6% of the total turnover, treating it as the embedded profit in such transactions. HELD THAT:- It is a well-accepted principle that transactions conducted in cash, particularly those intended to remain outside the purview of taxation, generally lack formal documentation. AO rightly observed that the absence of such documentation is intrinsic to unaccounted transactions and that the assessee s argument of maintaining proper excise and stock records does not negate the possibility of clandestine sales. Absence of a transaction in official records does not imply its non-existence, especially when corroborative evidence exists in the form of seized materials and thirdparty admissions. AO s rejection of the assessee s contention is supported by judicial precedents where unaccounted transactions are inferred from circumstantial evidence and cash trail analysis. The acceptance of such indirect evidence, particularly in cases involving tax evasion, is consistent with the principle laid down in the case of Sumati Dayal [ 1995 (3) TMI 3 - SUPREME COURT] and Collector of Customs vs. Bhoormull [ 1974 (4) TMI 33 - SUPREME COURT] which emphasize that the test of human probabilities must be applied in determining the nature of unexplained income. Estimation of income/profit determination - As settled legal principle that only the profit element in unaccounted turnover can be subjected to tax, not the entire sales figure. As decided in the case(s) President Industries [ 1999 (4) TMI 8 - GUJARAT HIGH COURT] and Panna Corporation [ 2014 (11) TMI 797 - GUJARAT HIGH COURT] held that when unaccounted turnover is detected, only the embedded profit is taxable. In the absence of any detailed verification of the industry s actual margins and considering that the CIT(A) has relied on the financials within the accounting period under review, we find the estimation of 6% profit to be a reasonable and fair approximation of the assessee s profit from these unaccounted sales. Assessee s appeal is partly allowed

  ---

• 2025 (2) TMI 121
  Additions made u/s. 69 - alleged advancement of cash loan and addition of notional interest thereon on estimate basis - Additions are entirely based on the document seized during the search conducted in the premises of third party and statements u/s. 132(4) of the Act were recorded - later retraction of statements as recorded under duress and when the statements were recorded, they were not in proper frame of mind - HELD THAT:- When the assessee as well as Shri Nilesh Shamji Bharani and other individuals have denied of alleged cash transaction in subsequent events, the duty of the AO was to gather more corroborative evidence to establish on record that the entries appearing in the seized material actually represent cash loan transaction of the assessee. However, except the seized material and the statements recorded u/s. 132(4) of the Act from some third-party individuals, the AO has absolutely no other evidence on record to corroborate the alleged cash loan transaction of the assessee. Pertinently, though, during the time search and seizure operation was carried out in case of M/s. Evergreen Enterprises and Shri Nilesh Shamji Bharani, a search and seizure operation was also carried out in case of the assessee, however, not a single piece of incriminating material was recovered from the assessee indicating involvement of assessee in the alleged cash loan transaction or any other illegal activity. It is quite surprising that considering the magnitude of the alleged cash loan transaction appearing in the seized document, not a single piece of incriminating material relating a cash loan transaction was recovered from the assessee during the search and seizure operation conducted on assessee. If the version of Mr. Jagdish T Ramani that the promissory note given by the borrower is delivered to the lender is to be taken on face value, then at least if not all few such promissory notes would have been recovered in course of search and seizure operation carried out in case of the assessee. It is quite improbable that such huge amount of cash loan transaction would not leave any trace of incriminating material /evidence with the assessee. Thus, on cumulative analysis of facts and materials available on record, we are of the opinion that is no conclusive evidence was available with the AO to establish on record that the entries appearing in the seized material actually represent cash loan transaction of the assessee. Thus, we have no hesitation in holding that the additions made on account of unexplained investment on account of alleged cash loan transaction and addition made on account of notional interest thereon being not based on cogent evidence, are unsustainable. Decided in favour of assessee.

  ---

• 2025 (2) TMI 120
  Order passed u/s 263/143(3)/ 147 as barred by limitation - HELD THAT:- The order passed by the ld. AO u/s 263/143(3)/147 of the Act dated 30.12.2015 should have been served upon the assessee on or before 31.12.2015, in terms of provision of Section 153 of the Act. However, the said was order served upon the assessee on 05.01.2016 by hand delivery and the assessee claimed the same to be hopelessly barred by limitation and accordingly non-est and ex-facie nullity in the eyes of law. We have also called for some clarification on the issue from the ld. CT(DR) who filed before us the letter from AO dated 02.09.2024 stating therein that the assessment order was passed on 31.12.2015 whereas the assessment order mention the date of passing the assessment order as 30.12.2015. AO further mentioned in the order that assessment order the day of passing the order was Thursday and 2nd and 3rd January, 2016 were holidays being Saturday and Sunday and thereafter the order was served on 5th January,2016. Thus, we are of the considered opinion that order was barred by limitation as it should have served on the assessee on or before 31.12.2015 Appeal of the assessee is allowed on legal issue.

  ---

• 2025 (2) TMI 119
  Addition u/s 68 - unexplained cash deposits in the bank accounts of several companies controlled by the assessee - double additions in the hands of the assessee and the respective companies - HELD THAT:- Hon ble Supreme Court held in the case of Laxmipat Singhania [ 1968 (8) TMI 8 - SUPREME COURT] that it is fundamental rule of law of taxation that, unless otherwise expressly provided, income cannot be taxed twice - No addition can be made in the hands of assessee as there is no any applicability of sec. 68 of the Act in his case because u/s 68 it must be proved that when any sum is found credited in the books of assessee maintained for any previous year but here no any sum found to be credited in the books of assessee so assessee / appellant not supposed to offer any explanation regarding nature and source thereof. CIT(A) rightly held that an addition deserves to be deleted as same has been added back in the case of Friends Telecom Pvt. Ltd., Modular International Pvt. Ltd. and M/s Gracious Overseas Pvt. Ltd. and double addition is not permissible in law. As established legal position that there has to be credit of amounts in the books maintained by assessee. Decided in favour of assessee.

  ---

• 2025 (2) TMI 118
  TDS u/s 194IC - payment of compensation towards alternative accommodation - assessee has booked expenses under the head Rent to Tenant SRA in its profit and loss account for the year under consideration - HELD THAT:- We find that a similar issue came up for consideration before Tribunal in Nathani Parekh Construction Pvt. Ltd., [ 2024 (7) TMI 1591 - ITAT MUMBAI] wherein while deciding the issue in favour of the taxpayer held that alternate accommodation charges/rent cannot be treated as consideration paid as part of share in land and building or both under the specified agreement and therefore, would not fall within the provisions of section 194-IC of the Act. CIT(A) is correct in deleting the tax and interest levied under section 201(1) and section 201(1A) - Decided in favour of assessee.

  ---

• 2025 (2) TMI 117
  Tribunal jurisdiction to adjudicate the present appeal - Unexplained money - cash deposit during demonetisation period - HELD THAT:- The appeal does not lie before the Cochin Bench, since the assessment order is passed by the AO situated at Srikakulam, Andhra Pradesh. The jurisdiction of the Tribunal is determined by the situs of the AO as per notification No. F. 63 dated 24.04.2019 issued under the Standing Order under Income Tax (Appellate Tribunal) Rules, 1963. It is also relevant to make a reference to the recent judgment in the case of PCIT v. ABC Papers Ltd. [ 2022 (8) TMI 863 - SUPREME COURT] and PCIT v. MSPL Ltd. [ 2023 (4) TMI 1181 - SC ORDER] wherein it was held that the jurisdiction of the Income Tax Appellate Tribunal is determined by the location of the Assessing Officer who pass the assessment order. Thus, appeal filed by the assessee does not lie before this Bench.

  ---

• 2025 (2) TMI 116
  Addition u/s 68 - assessee has not maintained books of accounts - HELD THAT:- Assessee suffered loss instead of gain. Even otherwise the assessee has not maintained books of account and credit has not been found credited in the books of accounts. Therefore in my view, the provisions of section 68 of the act are not applicable where the assessee has not maintained books of accounts and the same is not found credited in the books of accounts. Thus no amount has been found credited in the books of account, therefore, no addition could have been made u/s 68 of the act by the AO. Even otherwise Ld. CIT(A) while dealing with the appeal of the assessee adjudicated the provisions of section 69A instead Sec. 68 of the Act. Therefore the impugned order of CIT(A) is contrary to the provisions of law. Decided in favour of assessee.

  ---

• 2025 (2) TMI 115
  Deduction u/s 80P(2)(d) - interest income earned from investment with Cooperative Banks - HELD THAT:- The issue is covered in favour of the Assessee, as the identical deduction as claimed u/s 80P(2)(d) of the Act has been allowed in favour of the Assessees by various courts including by the Tribunal in the case of Pathare Prabhu Co-operative Housing Society Ltd. [ 2023 (7) TMI 1272 - ITAT MUMBAI] uphold the plea of the assessee and direct the AO to grant the deduction under section 80P(2)(d) of the Act to the assessee in respect of interest income earned from investment with Cooperative Banks. Decided in favour of assessee.

  ---

• 2025 (2) TMI 114
  Rejection of application for final registration u/s 80G(5) - assessee had inadvertently selected the wrong section code in their application - HELD THAT:- From the perusal of forms filed and the facts of the case, in our considered view, there is merit in claim of the AR that assessee has selected the wrong section code inadvertently while filing the application for final registration in Form 10AB. Further, we notice that assessee did not have the opportunity of being heard before CIT(E) due to incorrect course of action advised, which otherwise assessee might have explained the facts to avoid the impugned rejection. We remit the issue back to the file of CIT(E), with a direction to grant final approval to assessee under Clause (iii) to first proviso to section 80G(5) if assessee is otherwise found eligible. Appeal of the assessee is allowed for statistical purposes.

  ---

• Customs

• 2025 (2) TMI 113
  Refund of excess custom duty paid - rejection of refund on the ground that the Appellant has not provided re-assessed bills of entry in respect of said refund claims - Condonation of delay in filing refund application and filing of appeal - HELD THAT:- The Supreme Court in ITC LIMITED VERSUS COMMISSIONER OF CENTRAL EXCISE, KOLKATA -IV [ 2019 (9) TMI 802 - SUPREME COURT (LB)] reversed the decisions in MICROMAX INFORMATICS LIMITED VERSUS UNION OF INDIA OTHERS [ 2016 (3) TMI 431 - DELHI HIGH COURT] and YU TELEVENTURES PVT. LTD. VERSUS UNION OF INDIA ORS [ 2016 (8) TMI 184 - DELHI HIGH COURT] . It was directed that until and unless the assessment itself was finally modified, the refund could not be allowed. As per the Supreme Court s decision in ITC refund applications could not be directly entertained without the order of assessment being modified through an order under Section 128 of the Customs Act, 1962 or under any other relevant provisions of the Act. The bills of entry date back to 2014 and the applications for refund were filed way back in 2015. After the said applications were filed, in fact, the refund was allowed. These bills of entry were subject matter of adjudication before this Court and the matter has then travelled a long way till the Supreme Court. In the earlier round, the issue of delay between the bill of entry and the application for refund has never been raised and it has, therefore, reached a finality. That period cannot now be calculated for the purpose of holding that the appeals filed before the CESTAT after the judgment in ITC are delayed. In fact, the appeals are filed within the 90-day period from the date of pronouncement of judgment in ITC. Even the benefit of Section 14 would have to be given to the Appellant in this case in view of the fact that the fundamental basis for the refund has itself been changed after the decision in ITC by the Supreme Court. The delay in any case is, therefore, condonable. Conclusion - The Appellant cannot be non-suited on the ground that the appeals are barred by limitation. The appeals are allowed.

  ---

• 2025 (2) TMI 112
  Imposition of a penalty under Regulation 18 of the Customs Brokers Licensing Regulations (CBLR), 2013 - alleged violations of Regulations 11(a), 11(n) and 11(9) of CBLR - HELD THAT:- Regulation 18 prescribes revocation of license or imposition of penalty and hence, it is clear that there could be either revocation of license or imposition of penalty. The said provision embodies that the penalty, if at all imposed, shall not exceed 50,000 on Customs Broker, subject to any of the grounds provided thereunder, i.e. (a) there should be a failure to comply with any of the conditions of bonds executed under Regulation 8(b)(b); failure to comply with any of the Regulations; and (c) committing any misconduct. There is no dispute that (d), (e) (f) are not relevant here. The Competent Authority who was seized of the matter has felt it proper to pass order after considering the Inquiry Report and the representations made by the Customs Broker, which order is clearly passed as he deemed fit . Hence, there are no fault with the exercise of the jurisdiction, which was clearly the domain of the said Authority. Hence, it cannot be entertained that the penalty imposed was not proportionate to the gravity of the offence, if at all committed. Hence, there are no error. Conclusion - The Inquiry Report is neither fool-proof, nor beyond doubts and suspicion and therefore, the same does not find a mention anywhere in the impugned order. Further, in the impugned order also, the Commissioner has not brought out any documentary evidence on record to establish violation to any of the grounds [(a) or (b) or (c)] prescribed under Regulation 18 which is essential, before imposing penalty and hence, there are no reason to sustain the said imposition of penalty for which reason, the same is deleted. Revenue s Appeal is dismissed.

  ---

• 2025 (2) TMI 111
  Valuation of imported goods - Lauric Acid - whether the rejection of declared classification of the impugned goods in question and re-classifying the same by the authorities below is correct? - HELD THAT:- The crux of the findings in the Orders-in-Original is that the impugned goods is neither a salt nor ester of Palmitic or Stearic Acid , subheading 2915.70 of Customs Tariff which deals with Palmitic Acid and Stearic Acid, their salts and esters; tariff 2915 7090 is very specific and limited to those two fatty acids and their salts and esters which cannot be stretched to include other saturated fatty acids, like the impugned goods herein since, the same is neither a salt nor an ester. The importer, however, is unable to make in-roads into the above findings by countering with documentary evidence. The Appellant appears to have relied upon an opinion but there are no copy of the same being filed and nor there are other documentary evidence placed on record in support. There is just a claim and arguments and other than these, there are no materials placed in support. Conclusion - The re-classification of Lauric Acid under Tariff Item 29159090 is justified. Appeal dismissed.

  ---

• 2025 (2) TMI 110
  Classification of imported goods - Receiver - Microphone - Connectors - various covers and assembles - eligibility for exemption. Classification of imported goods - Receiver - to be classified under CTH 85177090 or under CTH 85181000? - benefit under N/N. 50/2017-Cus. dt. 30.06.2017 (Sl.No.499) - HELD THAT:- This very Bench in the case of M/S. FLEXTRONICS TECHNOLOGIES PVT. LTD., COMMISSIONER OF CUSTOMS VERSUS COMMISSIONER OF CUSTOMS CHENNAI, M/S. FLEXTRONICS TECHNOLOGIES PVT. LTD. [ 2024 (2) TMI 1509 - CESTAT CHENNAI] where the bench felt it proper to remand this issue for the detailed reasons given therein. Taking cognizance of Note 2 to Section XVI as above, the parts which are goods included in any of the headings of Chapter 84 or 85 are required to be classified in their respective headings; parts which are suitable for use principally with goods of heading 8517 and 8525 to 8528 are to be classified in Heading 8517. Receiver claimed to be specifically coming under CTH 8518 is required to be considered in ejusdem generis, i.e in the context of the words accompanying with the heading. The tariff heading 8518 refers to micro phones and stands therefor; loud speakers, whether or not mounted in their enclosures; head phones and ear phones, whether or not combined with a micro phone etc. which are perhaps separate parts per se whereas the Receiver under dispute in this appeal is a part of the phone - The classification sought to be made by the Revenue under CTH 8518 lacks any merit and set aside - since the classification declared by the assessee was in order, there was no scope for levying or demanding duty and the consequential interest and penalty and hence, the goods are not liable for confiscation. There are no infirmity in the non-levy of redemption fine. Classification of imported Microphone - to be classified under 85183000 or under CTH 85181000? - benefit of concessional rate of duty under N/N. 57/2017-Cus. - HELD THAT:- This very Bench in the case of Flextronics Technologies Pvt. Ltd. has dealt with the classification of Microphones very exhaustively and further held that Microphones were not eligible for exemption as claimed by the assessee - there was no suppression involved since the case involves a genuine interpretative issue for which, extended period could not be invoked. Hence, the demand, if any, is to be confined to the normal period with applicable interest, if any. Classification of impugned Connectors - to be classified under CTI 85177090 or under CTH 85369090? - HELD THAT:- The PCBA though a separate part of a mobile phone forms the backbone of the said phone and all inputs or parts of the phone are connected to PCBA either directly or indirectly. Connectors play an important role in completing the PCBA circuiting and would form a part of the PCBA and are thus covered by Sl. No. 6A of N/N. 57/2017-Cus dated 30.06.2017. Therefore, it is only in the subsequent Notifications viz. No.37/2018, No.24/2019 and No.03/2021, the scope of PCBA came to be restricted by incorporating exclusions. Therefore, when through the subsequent Notifications, items like connectors, microphones, receivers, etc. are excluded, all the inputs and parts that are specifically excluded will not get the benefit of exemption. In the light of the above subsequent amending Notifications, the connectors would also not be eligible for any benefit. However, the fact remains that the exemption to BCD was very much available in terms of N/N. 24/2019 - the Assessee is eligible for benefit for exemption for the subject goods viz. Connectors . Classification of Rear Cover, A Cover, D Cover Assy. B Cover, Front Housing, Rear Housing, Camera Lens, Front Cover ASM and Battery Cover ASM - extended period of limitation - HELD THAT:- The impugned goods, as listed above being parts of cellular phones falling under CTH 85177090, are eligible for the benefit of exemption under Notification No.50/2017 (Sl.No.499) as amended. The impugned order is set aside and Asssessee s Appeal is allowed. Conclusion - i) The Receivers are parts of cellular mobile phones and should be classified under CTH 85177090, as they are not standalone products like microphones or loudspeakers. ii) Microphones are not eligible for exemption under the claimed notification. iii) Connectors are essential parts of mobile phones and are eligible for exemption under the relevant notifications and classified CTH 85369090. iv) The covers and assemblies are integral to cellular phones and eligible for exemption under N/N. 50/2017 and should be classified under CTH 85177090. Appeal disposed off.

  ---

• Insolvency & Bankruptcy

• 2025 (2) TMI 109
  Maintainability of Petition filed by the Respondent No. 1 under Section 95 of IBC - initiation of Personal Insolvency Resolution Process (PIRP) against the Appellant who is the guarantor of the of the Corporate Debtor ESL - barred by limitation - no privity of contract between the Appellant and State Bank of India (SBI) - Impugned Order based on invocation of personal guarantee by 3rd party - no direction issued u/s 100 (2) of the Code regarding negotiations to be held in Appellant/ personal guarantor and the Creditor/ Respondent - undervaluation of shares. The application filed under Section 95 of the Code was barred by limitation - HELD THAT:- The Respondent No. 1 issued a demand notice on 22.06.2018 requesting for payment within 60 days i.e., by 22.08.2018 and therefore, for the purpose of calculating limitation period in the present case would have started on 22.08.2018 and would have ended on 21.08.2021. The application was filed on 31.03.2021 much before the expiry of the limitation period. Both the demand notice as well as Section 95 application were filed within period the period of limitation - arguments of the Appellant on the issue of limitation stand rejected. Privity of contract - HELD THAT:- There was no privity of contract between Respondent No.1/ SBI and Appellant/ personal guarantor. Impugned Order based on invocation of personal guarantee by 3rd party - HELD THAT:- The Adjudicating Authority could not have passed the Impugned Order based on invocation of personal guarantee by 3rd party - such trusteeship deeds are generally signed between the trust on behalf of the lenders and the personal/ corporate guarantor of the principal borrower. However, by its inherent nature and intent, the lenders or the Financial Creditors are the true beneficiaries of such deed of guarantee. From the terms of the MRA and the STA, it is clear that the security trustees are holding Security not for themselves, but on behalf of, and for the benefit of, the Claimant/Lender. The Lenders, can therefore, enforce the security documents even if they are not a party to the trusteeship agreement. The Adjudicating Authority has rightly held in para 14 of the Impugned Order that merely because the trustee acted on behalf of Respondent No. l/SBI, it cannot be said that the beneficiary/creditor cannot enforce the Personal Guarantee executed by the Appellant. As can be seen from clause O of the MRA, SBICAP was appointed as Security Trustee in accordance with the terms of the Security Trustee Agreement dated 25.03.2014 for the purpose of holding the security interest for the benefit of the CDR lenders and non-CDR lenders. Thus, SBI had the locus to file the Company Petition - there are no merit and the pleadings of the Appellant on this account stand rejected. The Appellant has also challenged on the ground that the debt itself has not been crystalised - HELD THAT:- The personal guarantor signed the personal guarantee on 03.06.2015 and became guarantor on behalf of principal borrower. The borrower amount has been stipulated therein. It is already noted that there has been established the case of default of debt and subsequently CDR was sanctioned which also failed - the arguments of the Appellant not appreciated on this account based on argument that mere fact that the case is pending before the DRT and certain counter claims have been filed by the Appellant will not make debts payable by the Appellant as debts not have been crystalised - the contention of the Appellant on this ground stand rejected. Impugned Order did not issue directions under Section 100 (2) of the Code regarding negotiations to be held in Appellant/ personal guarantor and the Creditor/ Respondent - HELD THAT:- Section 100 (2) Code is applicable if repayment plan is prepared by the debtor under Section 105 of the Code then opportunity should be offered to the debtor. The order of the Adjudicating Authority is only if the Resolution Professional makes an application for the same. The Impugned Order ignored the fact regarding under valued sale of shares of Corporate Debtor subsidiary in learning.com leading to gross under recovery for the principal borrower - HELD THAT:- There are no merit on this ground in the present appeal. Conclusion - i) The application under Section 95 was filed within the limitation period. ii) The lack of direct privity of contract did not prevent the creditor from enforcing the personal guarantee. iii) The debt was crystallized, and pending proceedings did not affect this status. iv) No directions for negotiations were warranted under Section 100(2) as no repayment plan was proposed. v) The undervalued sale issue was addressed in a separate judgment, and no merit was found in the Appellant s arguments. Appeal dismissed.

  ---

• PMLA

• 2025 (2) TMI 108
  Money Laundering - Seizure of bank lockers and Gold - Challenge to order passed by the Adjudicating Authority confirming the seizure of the properties belonging to the appellants - HELD THAT:- The appellant has questioned the seizure of bank lockers on the ground that they were already under seizure by the CBI and for the aforesaid reason,there was no chance to deal with those lockers by the appellants. A specific reference of locker no. 86 and 96 in the name of the appellant was given. It is found that if the lockers are already under seizure of CBI, it could not have been seized by the respondent by invoking Section 17(1) of the Prevention of Money- Laundering Act, 2002. In fact, it could have been when they apprehend concealment or tampering of the record or the property. The concealment could not have been when the lockers were already seized by the CBI. Thus, there are no justification on the part of the respondent to seize the locker no. 86 and 96 in the name of the appellant, Shri Luv Bhardwaj. There are no justification to seize 3.2 kg gold found at the time of search. The appellant has given reference of the Circular issued by the CBDT and submitted that the said gold was belonging to his mother, wife, unmarried daughter apart from recently wedded sister. A woman is entitled to keep 500 gms gold while an unmarried woman is entitled to 250 gms gold. Once the locker was under seizure with the CBI, there remained no justification or reason to seize the same locker and thereby interference in the seizure of those lockers is also made for the reason that seized lockers cannot be seized again rather they can again be seized, if it is released by the CBI. The respondent would be at liberty to seize those lockers by taking an action afresh for which this order would not come thereby. Conclusion - The properties already under seizure by one authority (CBI) should not be seized again by another unless specific conditions are met, such as release by the initial authority. The respondent s actions lacked justification in several instances, leading to partial interference with the impugned order. Appeal disposed off.

  ---

• 2025 (2) TMI 107
  Money Laundering - proceeds of crime - challenge to Provisional Attachment Order - selection process of Assistant Teachers of primary schools said to have been conducted in an unfair manner to give appointment to the ineligible candidates - offence under Sections 7, 7A and 8 of the Prevention of Corruption Act, 1988 and Section 120-B, 420, 467, 468, 471 and 34 of IPC, 1860 - HELD THAT:- The analysis of the bank account would show receipt of huge money from different sources without giving description or the basis to disclose the source. The appellant has failed to disclose his business with required details so as to justify transactions shown in the bank account which otherwise remain unexplained even during the course of arguments. The Directors other than Prabir Das were dummy in view of their statement. They were not knowing about the business of the firm if it was existing. All those facts are relevant in the light of the allegation against the appellant and unusual practice by which Prabir Das having share of 10% transferred huge sum in favour of the firm. Conclusion - i) The attachment of the bank accounts of M/s SKP Enterprises was justified under the Prevention of Money Laundering Act, 2002. ii) The appellant failed to provide sufficient evidence of legitimate sources for the funds, leading to the dismissal of the appeal. Appeal dismissed.

  ---

• Service Tax

• 2025 (2) TMI 106
  Review petition - no error apparent on the record - Extended period of limitation - Suppression of facts or not - Levy of Service Tax - health and fitness service - providing education to patients regarding Yoga - donation received in respect of yoga camp / residential Yoga camp - HELD THAT:- There is no error apparent on the record. Review Petition is dismissed.

  ---

• 2025 (2) TMI 105
  Challenge to recovery notice - eligibility for the benefits under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 - mis-declaration regarding the pendency of an appeal - misdeclaration regarding date of filing of the appeal - HELD THAT:- Since the declaration in Form SVLDRS-1 dated 31.12.2019 that was filed by the petitioner was not under the voluntary disclosure category , the rigours of clause (c) to sub-section (2) to section 129 (1) of the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 in Chapter V of the Finance Act, 2019 cannot be pressed against the petitioner - The petitioner ought to have filed a correct declaration under Amount in Arrears category as defined in Section 121(c) of the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 in Chapter V of the Finance Act, 2019 as no appeal was pending on 30.06.2019. Since the declaration in Form SVLDRS-1 dated 31.12.2019 filed by the petitioner under the litigation category [i.e., pendency of appeal] was incorrectly filed and should have been filed under Amount in Arrears Category , the amount that was payable by the petitioner would have higher. Since the petitioner was otherwise entitled to relief under Section 124(1)(ii) of the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 in Chapter V of the Finance Act, 2019, the benefit of the Scheme cannot be denied, provided the petitioner pays the correct amount - the Impugned Communication dated 30.03.2021 cannot be said to be strictly in consonance with Section 129(2)(c) of the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 in Chapter V of the Finance Act, 2019 in revoking the Discharge Certificate in Form SVLDRS-4 dated 07.03.2020. Nevertheless, powers are vested with the Designated Authority under the said Act to correct the mistake in the Discharge Certificate in Form SVLDRS-4, if the Designated Authority was mislead and an improper declaration is filed by a declarant. If the petitioner wants the benefit of the Scheme, the petitioner should pay the correct amount together with interest. Since there is no enabling machinery under the provisions of the Finance Act, 1994 which enables the Department to recover the tax due from the Directors of the Company which is in arrears of tax, recovery / attachment of Bank Accounts of the Directors of the defaulting Company namely M/s.Laundry Projects India Private Limited, the Impugned Communication dated 23.11.2021 seeking to attach the Bank Accounts of the individual Directors purportedly in exercise of powers conferred under Section 87 of the Finance Act, 1994 has to be held to be without jurisdiction - It also appears that a sum of Rs. 22,00,000/- has been recovered from the account of the petitioner in W.P.No.4329 of 2022, who is the Director of the said Company on 10.01.2022. This amount can be adjusted against the aforesaid deficit amount of Rs. 29,94,472.20/- [Rs.45,65,834.20/- - Rs. 15,71,362/-] subject to the petitioner in W.P.No.4329 of 2022 consenting to the same. Conclusion - i) Since there is no provision to recover the dues of the writ petitioner in W.P.No.27248 of 2021 M/s.Laundry Projects India Private Limited (from the Directors of M/s.Laundry Projects India Private Limited) under the Scheme of the provisions of the Finance Act, 1994, the Communication dated 23.11.2021 impugned in W.P.No.4329 of 2022 shall stands quashed with consequential relief. ii) The petitioner was entitled to relief under Section 124(1)(c)(ii) and not under Section 124(1)(a)(ii) due to the absence of a pending appeal as of June 30, 2019. Petition disposed off.

  ---

• 2025 (2) TMI 104
  Levy of service tax on construction activities completed before the imposition of service tax on 01.07.2010 - non-payment of service tax on provision of taxable services of construction of residential complex - HELD THAT:- On perusal of the legal provisions of sub-sections (30a), (91a) of Section 65 of the Finance Act, 1994 and clause (zzzh) of Section 65(105) ibid, which provide for definition of various terms and itemized the scope of the entry of taxable service, respectively, it seen that any service provided in relation to construction of a complex which is intended for sale, wholly or partly, by a builder was subject to levy of service tax w.e.f. 01.07.2010. Exception made from such levy relate to those cases, where no sum or amount was received from any buyer before grant of completion certificate by the authority competent to issue it under the law. Construction of residential complexes having more than twelve residential houses or apartments together with common areas and other appurtenances were subjected to levy of service tax in the Union Budget for the year 2005. Further, in the definition of the taxable services of Construction of Complex service itself an explanation was provided that unless the entire consideration for the property is paid after the completion of construction (i.e. after issuance of completion certificate by the competent authority), the activity of construction would be deemed to be a taxable service provided by the builder/promoter/developer to the prospective buyer and the service tax would be charged accordingly. The certificate issued by MCGM on completion of building under the Mumbai Municipal Corporation Act is not only termed as occupancy certificate but also completion certificate with title FULL OCCUPANCY CERTIFICATE Under Regulation 6(7) and BUILDING COMPLETION CERTIFICATE Under Regulation 6(6) . However, the appellants have not provided any such certificate issued by the competent authority i.e., MCGM. There is no Full Occupancy Certificate or Building Completion Certificate issued by MCGM under Section 353A of the Mumbai Municipal Corporation Act, 1888. Therefore, it cannot be reasonably concluded that the construction of the residential complex in the present case was completed before 01.07.2010, in the absence of requisite Completion Certificate issued by MCGM to substantiate the same. The appellants have selectively relied upon word is completed in the certificate issued by the Chief Fire Officer, Mumbai Fire Brigade and Brihan Mumbai Mahanagar Palika to emphasize that the building has been completed on or before 25.01.2010, but has conveniently ignored the word part development work of building used while initiating the sentence which is clearly indicative that it is only a part and not the whole building which is completed. Further, in any case, the fact of the case clearly indicate that no occupancy certificate has been issued by the competent authority (MCGM) authorized by law (Mumbai Municipal Corporation Act, 1888) as is clearly required under the provisions of Finance Act, 1994. Further, the advance/sum of money received towards sale of flats/shops, even though was shown to have been accounted during the year 2020- 2021 in the appellants books of accounts, to the extent that such sum was relatable to the flats/shops for whose completion certificate was issued subsequent to the levy of service tax and is not covered by the exclusion part of the explanation to Section 65(105)(zzzh) ibid. Conclusion - The letter dated 25.01.2010 does not qualify as a completion certificate for service tax purposes, and the appellants failure to maintain separate accounts for deposits as required by the Maharashtra Ownership Flats Act resulted in service tax liability on such deposits. The appellant is liable to pay service tax. The impugned order dated 29.03.2019 is upheld and the appeal filed by the appellants is dismissed.

  ---

• 2025 (2) TMI 103
  Refund of the service tax paid - appellants contended that the developer had collected the service tax wrongly and they paid the tax by mistake of law - applicability of time limitation u/s 11B of the Central Excise 1944 as made applicable to service tax matters by virtue of Section 83 of the Finance Act, 1994 - Board Circular No. 108/02/2009-ST dated 29.01.2009 - insertion of explanation to Section 65(105)(zza) of the Finance Act, 1994 with effect from 01.07.2010 - HELD THAT:- There is catena of decisions wherein it is held that service tax on construction of complex service is not leviable for the period prior to 01.07.2010. It is also found that the service tax paid by the individual flat purchasers is during the period September 2008 to May 2010. Hence, the service tax on construction of complex is not leviable during that period. Further, it is found that the Hon ble High Court of Karnataka in the case of COMMISSIONER OF CENTRAL EXCISE (APPEALS), BANGALORE VERSUS KVR CONSTRUCTION [ 2012 (7) TMI 22 - KARNATAKA HIGH COURT ] held that When once there was no compulsion or duty cast to pay this service tax, the amount of Rs. 1,23,96,948/- paid by petitioner under mistaken notion, would not be a duty or service tax payable in law. Therefore, once it is not payable in law there was no authority for the department to retain such amount. By any stretch of imagination, it will not amount to duty of excise to attract Section 11B. Therefore, it is outside the purview of Section 11B of the Act. It is found that against the order of the Hon ble High Court of Karnataka the SLP filed by the Revenue was dismissed by the Hon ble Supreme Court reported in COMMISSIONER VERSUS KVR CONSTRUCTION [ 2011 (7) TMI 1334 - SC ORDER ]. Conclusion - The rejection of the refund claims by the Adjudicating authority/Appellate authority on the grounds of limitation under section 11B of the Central Excise 1944 as made applicable to service tax matters by virtue of Section 83 of the Finance Act, 1994 is not tenable and are liable to be set aside. Appeal allowed.

  ---

• 2025 (2) TMI 102
  Denial of Cenvat credit - service tax paid for Mandap Keeper Services in relation to their Annual Day celebrations - Mediclaim and personal accident policy premium paid to the employees. Mediclaim and personal accident policy premium paid to the employees - HELD THAT:- In view the decision of the Larger Bench in M/S. TATA TELESERVICES (MAHARASHTRA) LIMITED VERSUS COMMISSIONER, SERVICE TAX, MUMBAI-II. [ 2024 (3) TMI 1407 - CESTAT MUMBAI [LB]] , the insurance premium paid by the appellant in respect of the insurance policies taken for the employees and their family members can be considered as activity relating to business, for the period prior to 01.04.2011. Since the period involved in both the appeals is prior to 01.04.2011, it is found that the decision of the larger bench is squarely applicable to this case, hence the appeals are sustainable and need to be upheld. Mandap Keeper Services - HELD THAT:- Following the decision in M/s. Endurance Technologies Pvt Ltd. Vs. C.CEx., Aurangabad [ 2013 (8) TMI 601 - CESTAT MUMBAI] , it is found that the appeals are sustainable. Conclusion - The services in question indeed qualified as input services under the pre-01.04.2011 definition. The definition of input service prior to 01.04.2011 includes services related to employee welfare and business events, thereby Cenvat credit for such expenses allowed. Appeal allowed.

  ---

• Central Excise

• 2025 (2) TMI 101
  100% EOU - classification and duty exemption of imported drugs under N/N. 12/2012-Cus. dated 17 March, 2012, Serial No. 147(A) - difference between bulk drugs and drugs - HELD THAT:- The issue has been dealt with in para 5.2 of the decision in the matter of AUROBINDO PHARMA LTD. VERSUS COMMISSIONER OF C.EX., HYDERABAD-I [ 2009 (3) TMI 810 - CESTAT, BANGALORE] by the advocate, where it was held that the term drug has to be considered to include bulk drug and formulation as per Drugs (Prices Control) Order, 1995 and hence, both the items being bulk drugs are entitled for the benefit of the Notification. In view of the ratio, that there is no difference between bulk drugs and drugs and term drugs include the bulk drags also. This Court find that the issue is no more res integra. Conclusion - Imported drugs is eligible for duty exemption under N/N. 12/2012-Cus. dated 17 March, 2012, Serial No. 147(A). Appeal allowed.

  ---

• 2025 (2) TMI 100
  Implications of the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 (SVLDRS-2019) on penalties imposed on co-noticees - primary noticee has settled their duty demand under the scheme - HELD THAT:- This Court is bound by the Division Bench decision in PRAKASH STEELAGE LTD., DHARA ENGINEERING WORKS, SAMRUDDHI STEELS, KASHIPAREKH BROS AND AESH STEELS VERSUS C.C.E. S.T. BHARUCH [ 2024 (11) TMI 468 - CESTAT AHMEDABAD] where it was held that it is settled that once the duty demand case is settled under SVLDRS-2019, as per Scheme itself, there is a waiver of penalties on the main assessee against whom the demand was confirmed as well as on other conoticees. Conclusion - The penalties imposed on the co-noticees in a case where the main noticee against whom the demand is confirmed, the case is settled under SVLDRS then in respect of other co-noticees penalty will not sustain even if they have not filed a declaration under SVLDRS- 2019. Appeal allowed.

  ---

• CST, VAT & Sales Tax

• 2025 (2) TMI 99
  Vires of the West Bengal Tax on Entry of Goods into Local Areas Act, 2012 as it stood prior to its amendment - constitutional validity of the original Act and the amendments. What is the effect of the ratio of Jindal Stainless Ltd. [ 2016 (11) TMI 545 - SUPREME COURT (LB)] on the impugned judgment and order of the learned Single Judge dated June 24, 2013? - HELD THAT:- Although, Jindal Stainless Ltd has held that, all judgements that follow Atiabari [ 1960 (9) TMI 94 - SUPREME COURT] , Automobile Transport [ 1962 (4) TMI 91 - SUPREME COURT] and Jindal Steel Ltd [ 2016 (11) TMI 545 - SUPREME COURT (LB)] stands overruled, nonetheless, the appeals directed against the impugned judgement and order of the learned Single Judge remained pending without a formal order of disposal of the same. The appeals therefore are required to be formally disposed of an Appeal Court. A finding has to returned as to whether, the impugned judgement and order of the learned Single Judge following the overruled decisions of the Supreme Court rendered in Atiabari, Automobile Transport and Jindal Steel Ltd, in deciding the constitutional validity of the Entry Tax Act, 2012 should be sustained or not. A finding is returned that, learned Single Judge, in the impugned judgement and order dated June 24, 2013 proceeded on the basis of the ratio laid down in Atiabari, Automobile Transport and Jindal Steel Ltd to decide on the constitutional validity of the Entry Tax Act, 2012. Consequently, the impugned judgement and order dated June 24, 2013 cannot survive, subsequent to the pronouncement of Jindal Stainless Ltd. - the impugned judgement and order dated June 24, 2013 passed by the learned Single Judge is set aside. Are the impugned orders of the learned Tribunal correct? - HELD THAT:- Interim order passed by the Appeal Court on July 31, 2013 had permitted the assessment under the Entry Tax Act, 2012 to be continued. It had also restrained refund of the tax already collected. Appeal Court did not vacate the stay granted by the learned Single Judge in the impugned judgement and order. Appeal Court had regulated the implementation of the Entry Tax Act, 2012 in the manner noted in its order dated July 31, 2013. Therefore, it cannot be said that, the Appeal Court had decided on the vires of the Entry Tax Act, 2012 finally on either side of the divide. In fact, Appeal Court had made the interim arrangements as done by the interim order dated July 31, 2013 on the basis that the Entry Tax Act, 2012 subsists. It had therefore allowed the assessment under the Entry Tax Act, 2012 to continue with no refund being made. Shree Chamundi Mopeds Ltd. [ 1992 (4) TMI 183 - SUPREME COURT] has considered the provisions of the Sick Industrial Companies (Special Provisions) Act, 1985 and held that, when the High Court passes an interim order staying the operation of the order of the Appellate Authority exercising powers under the provisions of the Act of 1985, the same does not revive the appeal which had been dismissed as no such proceedings was pending before the Appellate Authority. There are no position to arrive at a finding that, the Entry Tax Act, 2012 came to be declared ultra vires on the expiry of 6 weeks from the date of the impugned judgement and order of the learned Single Judge being June 24, 2013 and consequently stood obliterated. Consequently, it cannot be held that, the amendments sought to be introduced by the West Bengal Finance Act, 2017 to the Entry Tax Act, 2012 are invalid simply on the basis that, the Entry Tax Act, 2012 stood obliterated on the expiry of 6 weeks from the date of the impugned judgement and order. In the facts and circumstances of the present case, the amending act does not take away any benefit which has accrued to any assessees by the amendments introduced retrospectively. At least now materials have been placed before us to suggest so. Was the Entry Tax Act, 2012 in force at the time of its amendment on March 6, 2017 in view of the impugned judgment and order dated June 24, 2013 of the learned Single Judge? - HELD THAT:- Entry Tax Act, 2012 was in force at the time of its amendment on March 6, 2017. Are the amendments introduced to the Entry Tax Act of 2012 by the West Bengal Finance Act, 2017 valid? - HELD THAT:- The amendments introduced to the Entry Tax Act, 2012 by the West Bengal Finance Act, 2017 are valid. Are the amendments introduced by the West Bengal Finance Act, 2017 to the Entry Tax Act, 2012 discriminatory? - HELD THAT:- The amendments introduced by the West Bengal Finance Act, 2017 to the Entry Tax Act, 2012 are not discriminatory. Conclusion - i) The Entry Tax Act, 2012 was valid at the time of its amendment, and the amendments introduced by the West Bengal Finance Act, 2017 were lawful and non-discriminatory. ii) The taxes are not inherently unconstitutional unless proven discriminatory. iii) The decision in Jindal Stainless Ltd. was pivotal in shaping the Court s conclusions, particularly regarding the overruling of earlier precedents. The writ petitions are disposed of by setting aside the impugned order of the Tribunal.

  ---

• 2025 (2) TMI 98
  Challenge to Impugned Assessment Orders - no period of limitation prescribed - challenge to the Impugned Assessment Orders are primarily on the ground that confirmation of demand for the respective Assessment Years viz., 2003-2004 and 2004-2005 are long after the period covered by the Impugned Assessment Orders - HELD THAT:- The Entry Tax Act, 2001 is not a self contained enactment. It is dependent on the provisions of the Tamil Nadu General Sales Tax (TNGST) Act, 1959 and later under the provisions of the Tamil Nadu Value Added Tax (TNVAT) Act, 2006 after the Tamil Nadu General Sales Tax (TNGST) Act, 1959 was repealed and stood substituted with the Tamil Nadu Value Added Tax (TNVAT) Act, 2006 - Assessment under the provisions of the Entry Tax Act, 2001 and under the provision of the Tamil Nadu General Sales Tax (TNGST) Act, 1959 have to be made coterminously as the basic documents required for assessment are one and the same. These documents have to be maintained for a period of five years though separate returns have been filed under these enactments. A reading of Rule 4(1) of the Entry Tax Rules, 2001, also makes it clear that, after the close of the year, for which the returns referred to in Sub- Rule (1) of Rule 3 of the Entry Tax Rules, 2001 have been filed or where an importer has discontinued the business the course of the year, the Assessing Authority has to finally assess the tax payable in a single order on the basis of the return for the year to which the return relates - Such assessment has to be completed after scrutiny of the accounts and making such enquiry as may be considered necessary to complete and finalize the assessment on the basis of a single order. Thus, the scheme of the Entry Tax Act is to finalize the assessment as expeditiously as possible although no time limit is prescribed. Since no time limit has been prescribed for completing the assessment under Rule 3(4), Rule 4(3) of the Entry Tax Rules, 2001, assessment has to be completed within a reasonable period of time and thereafter assessment for escaped turnover under Section 16 of the Tamil Nadu General Sales Tax (TNGST) Act, 1959 within a period of 5 years. Conclusion - i) There was no justification in passing the Impugned Assessment Orders belated in the year 2021 in respect of the Assessment Year 2003-2004 and the Assessment Year 2004-2005. It has to be assumed that the Department has accepted the returns filed by the petitioner for the respective Assessment Years and the assessment was completed under Rule 4(1) of the Entry Tax Rules, 2001. ii) The powers could have been invoked within 5 years after deemed assessment under Rule 4(1) of the Entry Tax Rules, 2001 and after the date of filing of returns. Petition allowed.

  ---