TMI Tax Updates - e-Newsletter dated: April 26, 2019 - with Direct Tax, Indirect Tax and GST Updates and Updates on FTP, FEMA, IBC & Corporate Laws etc. published on TMI with Latest Case Laws

Pricing Login

Tax Management India. Com
Law and Practice : Digital eBook
Research is most exciting & rewarding

Case Laws Acts Notifications Circulars Classification Forms Manuals Articles News D. Forum Highlights Notes

TMI - e-Newsletter TaxTMI CBIC Revises Tariff Values Under Section 14(2) for... TaxTMI Diamond Imprest Authorisation Form Updated with... TaxTMI Sea Cargo Manifest Regulations: CBIC Extends... TaxTMI CBIC Implements Electronic Processing for Personal... TaxTMI CBDT Authorizes Waiver of Interest on Delayed... TaxTMI SEBI Introduces New Governance Rules for High Value... TaxTMI Government exempts Bengal gram from AIDC and SWS... TaxTMI CGST Rules Amended: Rule 164 Changes Affect Tax... TaxTMI SEBI Eases ESG Compliance: New Green Credit... TaxTMI Portfolio Managers Given Extended Timeline of 15... TaxTMI CBIC Clarifies Section 128A Waiver Eligibility for... TaxTMI Transfer of Development Rights Constitutes... TaxTMI GST Fraud Mastermind Denied Bail Under Sections... TaxTMI Time-Barred GST Demand Quashed: Three-Year... TaxTMI Tax Assessment Order Invalidated for Missing... TaxTMI Latest Case-Laws TaxTMI Latest Notifications + Circulars TaxTMI GST Council Decisions TaxTMI

Home


Tax Updates - TMI e-Newsletters

Home e-Newsletters Index Year 2019 April Day 26 - Friday ← Older Newer →
TMI e-Newsletters FAQ
You need to Subscribe a package.
Newsletter: Where Service Meets Reader Approval. TMI Tax Updates - e-Newsletter April 26, 2019 Case Laws in this Newsletter: GST Income Tax Customs Corporate Laws Service Tax Central Excise CST, VAT & Sales Tax Indian Laws Articles 1. GST ON POLYPROPYLENE LENO BAGS By: Dr. Sanjiv Agarwal Summary: The classification of Polypropylene Leno Bags (PLBs) under the Goods and Services Tax (GST) was contested by a company before the Appellate Authority of Advance Ruling (AAAR) in West Bengal. Initially, the Advance Ruling Authority (AAR) classified these bags under Tariff Sub-Heading 6305 33 00. However, the AAAR reversed this decision, aligning with the company's previous declaration under Tariff Heading 3923 29 90, which pertains to plastic goods. The AAAR emphasized the doctrine of equitable estoppel, preventing the company from altering its declared tariff classification without justification. The ruling was supported by precedents from the Madhya Pradesh High Court and the Supreme Court of India. 2. MARGIN SCHEME UNDER GST By: DR.MARIAPPAN GOVINDARAJAN Summary: The Margin Scheme under GST allows dealers of second-hand goods to pay tax only on the margin between the selling and purchase price, preventing double taxation. Rule 32(5) of the CGST Rules specifies that no input tax credit should be claimed on such goods. Notification No.10/2017 exempts certain intra-State supplies of second-hand goods from central tax. In a ruling, the Authority for Advance Ruling confirmed that used lead acid batteries qualify as second-hand goods under the Margin Scheme, allowing inter-State supplies under the same provisions. This ruling ensures that the Margin Scheme applies to both intra- and inter-State transactions. Notifications Companies Law 1. F. No. 1/13/2013 CL-V, part-I, Vol.ll - dated 25-4-2019 - Co. Law Companies (Incorporation) Fourth Amendment Rules, 2019 Summary: The Government of India, through the Ministry of Corporate Affairs, issued the Companies (Incorporation) Fourth Amendment Rules, 2019, under the Companies Act, 2013. These amendments modify the Companies (Incorporation) Rules, 2014, specifically in rule 25A. The changes involve extending deadlines: the original date of "on or before 25.04.2019" is replaced with "on or before 15.06.2019," and "on or after 26th April, 2019" is changed to "on or after 16th June, 2019." These amendments take effect upon their publication in the official gazette. 2. F. No. 01/16/2013 CL-V (Pt-l) - dated 25-4-2019 - Co. Law Companies (Registration Offices and Fees) Second Amendment Rules, 2019 Summary: The Companies (Registration Offices and Fees) Second Amendment Rules, 2019, issued by the Ministry of Corporate Affairs of the Government of India, amends the Companies (Registration Offices and Fees) Rules, 2014. Effective from the date of publication in the Official Gazette, the amendment modifies the fee structure for filing the e-Form ACTIVE under rule 25A of the Companies (Incorporation) Rules, 2014. The fee is applicable until June 15, 2019, with a delayed filing fee set at Rs. 10,000. DGFT 3. 03/2015-2020 - dated 24-4-2019 - FTP Amendment in Appendix 3 (SCOMET Items) to Schedule - 2 of ITC (HS) Classification of Export and Import Items, 2018 Summary: The notification from the Directorate General of Foreign Trade (DGFT), dated April 24, 2019, announces amendments to Appendix 3 (SCOMET Items) of Schedule 2 in the ITC (HS) Classification of Export and Import Items, 2018. These changes involve updates to the classification and descriptions of various strategic commodities, including nuclear materials, military equipment, and cryptographic systems. The amendments cover specific technical details and criteria for inclusion in the SCOMET list, affecting items such as nuclear reactors, military vehicles, lasers, and information security systems. The updated appendix will be available on the DGFT web portal and will take effect 90 days from the notification date. GST - States 4. Order No. 05/2019 - dated 24-4-2019 - Gujarat SGST Gujarat Goods and Services Tax (Fifth Removal of Difficulties) Order, 2019 Summary: The Gujarat Goods and Services Tax (Fifth Removal of Difficulties) Order, 2019 addresses issues arising from the cancellation of registrations under the Gujarat Goods and Services Tax Act, 2017. The order highlights that many registrations were canceled due to non-compliance with notice procedures via email or portal, as taxpayers were unfamiliar with these methods. To rectify this, the order allows affected individuals, whose registrations were canceled by March 31, 2019, to apply for revocation of cancellation by July 22, 2019. This order took effect on April 23, 2019, as per the authority of the Gujarat government. 5. 22/2019-State Tax - dated 24-4-2019 - Gujarat SGST Notifying the provisions of rule 138E of the GGST Rules w.e.f 21st June, 2019 Summary: The Government of Gujarat, exercising powers under section 164 of the Gujarat Goods and Services Tax Act, 2017, has set June 21, 2019, as the effective date for implementing rule 138E of the Gujarat Goods and Services Tax (Fourteenth) Amendment Rules, 2018. This rule was initially outlined in a government notification dated December 31, 2018. Additionally, this notification is retroactively effective from April 23, 2019. The announcement was made by the Finance Department and authorized by the Joint Secretary to the Government of Gujarat. 6. 21/2019-State Tax - dated 24-4-2019 - Gujarat SGST Procedure for quarterly tax payment and annual return for taxpayers under Notification No 02-2019 State Tax Rate Summary: The Government of Gujarat, under the Gujarat Goods and Services Tax Act, 2017, mandates registered taxpayers benefiting from specific notifications to follow a special procedure for tax returns and payments. These taxpayers must submit a quarterly statement of self-assessed tax using FORM GST CMP-08 by the 18th of the month following each quarter. Additionally, an annual return must be filed using FORM GSTR-4 by April 30th of the subsequent financial year. Compliance with these forms fulfills the requirements of sections 37 and 39 of the Act. This notification is effective from April 23, 2019. 7. 20/2019-State Tax - dated 24-4-2019 - Gujarat SGST Gujarat Goods and Services Tax (Third Amendment) Rules, 2019 Summary: The Gujarat Goods and Services Tax (Third Amendment) Rules, 2019, effective from April 23, 2019, introduce changes to the Gujarat GST Rules, 2017. Key amendments include the requirement for taxpayers to submit all due returns within 30 days following the revocation of registration cancellation. Rule 62 is revised to update the form and manner of submission for quarterly returns and annual returns for composition taxpayers, introducing FORM GST CMP-08 for quarterly self-assessment tax payments. Additional provisions are made for taxpayers ceasing to avail certain government notifications, requiring specific filings. Instructions for FORM GST REG-01 are also updated to reflect these changes. 8. Order No. 05/2019-State Tax - dated 23-4-2019 - West Bengal SGST West Bengal Goods and Services Tax (Fifth Removal of Difficulties) Order, 2019 Summary: The West Bengal Goods and Services Tax (Fifth Removal of Difficulties) Order, 2019 addresses issues arising from the cancellation of GST registrations under section 29(2) of the WBGST Act. Many registrations were canceled due to non-compliance with notice procedures via email or portal, unfamiliar to taxpayers accustomed to manual notices. The order allows affected taxpayers, whose registrations were canceled before March 31, 2019, to apply for revocation of cancellation by July 22, 2019. This measure aims to mitigate difficulties faced by taxpayers unfamiliar with the new notification methods under the GST regime. 9. 683-F.T. - dated 23-4-2019 - West Bengal SGST Corrigendum to notification No.559-FT dated 29.03.2019. Summary: A corrigendum has been issued to amend Notification No. 559-FT dated March 29, 2019, concerning the West Bengal Goods and Services Tax (Second Amendment) Rules, 2019. The correction pertains to Rule 11, specifically in the substituted Form GST DRC-08. The marginal heading previously incorrectly referred to "FORM GST DRC-07" and is now corrected to "FORM GST DRC-08." This amendment is authorized by the Additional Secretary to the Government of West Bengal. 10. 682-F.T. - dated 23-4-2019 - West Bengal SGST Corrigendum to notification No.552-FT dated 29.03.2019. Summary: In the corrigendum to Notification No. 552-FT dated March 29, 2019, issued by the Government of West Bengal's Finance Department, a correction has been made. Specifically, in clause (ii), within the Table in sub-clause (a), the entry (ic) in column (3) has been amended. The figure in column (4) has been changed from "3.75" to "0.75." This correction is authorized by the Additional Secretary to the Government of West Bengal. 11. 681-F.T. - 22/2019-State Tax - dated 23-4-2019 - West Bengal SGST To notify the provisions of rule 138E of the WBGST Rules w.e.f. 21st June, 2019. Summary: The Government of West Bengal, through its Finance Department, has announced that the provisions of sub-rule (11) of rule 2 of the West Bengal Goods and Services Tax (Fourteenth) Amendment Rules, 2018, will be effective from June 21, 2019. This notification, issued under the authority of section 164 of the West Bengal Goods and Services Tax Act, 2017, was published as notification No. 681-F.T. on April 23, 2019. The amendment details were initially published in the Kolkata Gazette on December 31, 2018. 12. 680-F.T. - 21/2019-State Tax - dated 23-4-2019 - West Bengal SGST Notification under section 148 regarding procedure for quarterly tax payment and annual filing of return for composition taxpayers and taxpayers availing the benefit of Notification No. 377-F.T. Summary: The Government of West Bengal, exercising powers under section 148 of the West Bengal Goods and Services Tax Act, 2017, has issued a notification outlining procedures for registered composition taxpayers and those availing benefits under Notification No. 377-F.T. These taxpayers must submit quarterly statements of self-assessed tax payments using FORM GST CMP-08 by the 18th of the month following each quarter. Additionally, they are required to file an annual return using FORM GSTR-4 by April 30th of the subsequent financial year. Compliance with these requirements fulfills obligations under sections 37 and 39 of the Act. 13. 679-F.T. - 20/2019-State Tax - dated 23-4-2019 - West Bengal SGST West Bengal Goods and Services Tax (Third Amendment) Rules, 2019 Summary: The West Bengal Goods and Services Tax (Third Amendment) Rules, 2019, effective immediately, introduce changes to the West Bengal GST Rules, 2017. Key amendments include provisions for filing returns within 30 days following the revocation of registration cancellation, even if canceled retrospectively. Rule 62 is revised to require composition taxpayers to submit quarterly statements in FORM GST CMP-08 and annual returns in FORM GSTR-4. A new FORM GST CMP-08 is introduced for self-assessed tax payments. Additional instructions for taxpayers availing benefits under Notification No. 377-F.T., dated 7th March 2019, are also included. 14. 19/2019 – State Tax - dated 22-4-2019 - West Bengal SGST Extension of due date for filing GSTR-3B for the month of March, 2019 till 23.04.2019. Summary: The Government of West Bengal, through the Directorate of Commercial Taxes, has extended the deadline for filing the GSTR-3B return for March 2019. The new deadline is set for April 23, 2019. This amendment to the previous notification, under the authority of the West Bengal Goods and Services Tax Act, 2017, allows taxpayers additional time to submit their returns electronically via the common portal. This change is effective from April 20, 2019, as per the notification issued by the Commissioner of State Tax. Circulars / Instructions / Orders GST - States 1. 97/16/2019-GST - dated 8-4-2019 Clarification regarding exercise of option to pay tax under notification No. 2/2019- State Tax (Rate) dated 07.03.2019 Summary: The circular clarifies the procedure for registered persons in Gujarat opting to pay a 3% State tax rate on first supplies under notification No. 2/2019, effective from April 1st, 2019. Eligible persons must file FORM GST CMP-02 by April 30, 2019, and submit FORM GST ITC-03 as per specified rules. New registrants can indicate their option in FORM GST REG-01. The tax option applies to all business locations under the same PAN and is effective from the financial year start or registration date. Chapter II of the Gujarat GST Rules applies, except as specified. Any implementation issues should be reported to the Chief Commissioner. 2. 95/14/2019-GST - dated 28-3-2019 Verification of applications for grant of new registration Summary: The circular from the Chief Commissioner of State Tax, Gujarat, addresses the issue of individuals applying for new GST registrations instead of revoking their cancelled registrations under the Gujarat Goods and Services Act, 2017. It highlights that some applicants may suppress information about previous registrations to avoid tax liabilities. The circular instructs proper officers to exercise caution and verify details on the common portal when processing new registration applications, especially if the applicant has an existing or previously cancelled registration. Applications may be rejected if deficiencies are found, particularly if the applicant has not applied for revocation of a cancelled registration. 3. 96/15/2019-GST - dated 28-3-2019 Clarification in respect of transfer of input tax credit in case of death of sole proprietor Summary: The circular issued by the Chief Commissioner of State Tax, Gujarat, addresses the transfer of unutilized input tax credit (ITC) upon the death of a sole proprietor under the Gujarat Goods and Services Tax Act, 2017. It clarifies that the transfer of business due to the proprietor's death is recognized as a valid reason for ITC transfer. The successor must register for GST from the date of succession and can file FORM GST ITC-02 to transfer the ITC to their electronic credit ledger. The successor is also liable for any tax, interest, or penalties due from the deceased proprietor. 4. 94/13/2019-GST - dated 28-3-2019 Clarifications on refund related issues Summary: The circular issued by the Chief Commissioner of State Tax, Gujarat, addresses various issues related to GST refund claims. It clarifies procedures for claiming refunds of accumulated input tax credit (ITC) due to inverted tax structures, especially when ITC has been reversed. Registered persons who have reversed ITC are advised to claim refunds under the "any other" category. Those who haven't reversed ITC should do so via FORM GST DRC-03. Interest applies for late reversals. Merchant exporters claiming refunds on zero-rated supplies must follow specific guidelines. The circular also addresses issues with refund applications following deficiency memos, allowing manual resubmission. 5. 93/12/2019-GST - dated 11-3-2019 Nature of Supply of Priority Sector Lending Certificates (PSLC) Summary: The circular addresses the tax implications for trading Priority Sector Lending Certificates (PSLC) by banks on the RBI's e-Kuber portal. It clarifies that for transactions from July 1, 2017, to May 27, 2018, the seller bank is responsible for paying GST at a 12% rate on a forward charge basis. From May 28, 2018, GST is levied on a reverse charge basis, payable by the buyer bank. The supply of PSLC between banks is treated as inter-state trade, requiring IGST payment. Banks that have already paid CGST/SGST or CGST/UTGST are exempt from further IGST payments for those transactions. 6. 92/11/2019-GST - dated 8-3-2019 Clarification on various doubts related to treatment of sales promotion schemes under GST Summary: The circular issued by the Chief Commissioner of State Tax, Gujarat, addresses clarifications on the treatment of sales promotion schemes under GST. It explains that free samples and gifts, provided without consideration, are not considered 'supply' under GST, and input tax credit (ITC) is not available for these. In 'Buy One, Get One Free' offers, the supply is treated as two goods for the price of one, with ITC available for inputs. Discounts, including volume discounts, are excluded from the supply value if conditions in section 15(3) are met, allowing ITC. Secondary discounts, issued post-supply, are not excluded from the supply value and do not affect ITC availability. 7. 90/09/2019-GST - dated 18-2-2019 Compliance of rule 46(n) of the GGST Rules, 2017 while issuing invoices in case of inter- State supply Summary: Registered persons supplying taxable goods or services must issue tax invoices as per section 31 of the Gujarat Goods and Services Tax Act, 2017, and include specific details as outlined in Rule 46 of the GGST Rules. It has been noted that some sectors, such as banking and telecom, fail to include the place of supply and the State's name in inter-State transactions, violating Rule 46(n). The Chief Commissioner of State Tax mandates that these details be included to ensure tax accrues to the correct State. Non-compliance may result in penalties under sections 122 or 125 of the GGST Act. 8. 91/10/2019-GST - dated 18-2-2019 Clarification regarding tax payment made for supply of warehoused goods while being deposited in a customs bonded warehouse for the period July, 2017 to March, 2018 Summary: The circular issued by the Chief Commissioner of State Tax, Gujarat, addresses tax payments for warehoused goods deposited in customs bonded warehouses between July 2017 and March 2018. During this period, the GST portal lacked the functionality to report integrated tax for these transactions, leading suppliers to incorrectly report them as intra-State supplies, paying central and state taxes instead. The circular clarifies that, as a one-time exception, such payments will be considered compliant if the total tax paid matches the integrated tax due. This measure ensures consistency in tax law implementation across different regions. FEMA 9. 33 - dated 25-4-2019 Investment by Foreign Portfolio Investors (FPI) in Debt - Review Summary: The circular addresses the investment by Foreign Portfolio Investors (FPI) in debt instruments in India, specifically permitting FPIs to invest in municipal bonds. These investments will be included within the existing limits set for FPI investment in State Development Loans (SDLs). All other conditions for FPI investments in the debt market remain unchanged. Authorized Dealer Category-I banks are instructed to inform their clients about these changes. Amendments to the relevant Foreign Exchange Management Regulations have been notified by the government, and the directions are issued under the Foreign Exchange Management Act, 1999. Highlights / Catch Notes GST Hostel Accommodation Under Rs. 1000 Per Day Exempt from GST: No Tax on Lump Sum Payments. Case-Laws - AAR : Levy of GST - activity of providing the hostel - declared tariff below ₹ 1000 - The lump sum amount received per unit (bed) per day against the accommodation services in hostel is to be treated as exempt supply. Visit to Get Source Mining Company Contributions to DMF and NMET Classified as Royalty, Subject to GST Under Reverse Charge Mechanism. Case-Laws - AAR : Classification of service - royalty - mining lease - RCM - the contribution made by M/s NMDC to DMF and NMET merits treatment as mining royalty in the course or furtherance of business of M/s NMDC. - are liable to GST, under reverse charge basis. Visit to Get Source Goods Detained Due to Missing E-Way Bill Part-B; Petitioner Challenges GST Act Applicability, Awaits Further Review. Case-Laws - HC : Detention of goods & vehicle on the ground that Part-B of the E-way bills was not generated - goods were being moved from the customs warehouse to the petitioner's own godown and it being the case of the petitioners that there was no supply, and hence, the provisions of GST Act are not applicable. - Goods to be released subject to bond. - Matter restored before the authority. Visit to Get Source GST Rates for Fluoride Control Project: NIL if Goods <25% of Total Supply, 12% if >25. Case-Laws - AAR : Rate of GST - activity of O & M of Fluoride control project on ESCO Model - water supply for domestic, industrial and commercial purposes is responsibility of Municipality - ESCO plant redevelopment is in relation to clean drinking water facility to the citizens - Composite supply of goods and services if supply of goods is below 25% out of total value of supply then GST will be NIL and if more than 25% then GST will be @12% Visit to Get Source GST Rate for Nuclear Fuel Complex Supply Set at 18% for Commercial Use; 12% Rate Not Applicable. Case-Laws - AAR : Rate of GST - supply to Nuclear Fuel Complex (NFC) - The activity of manufacture of fuel from NFC is leading to ultimate production and distribution of electricity which is a commercial activity - rate of 12% not applicable as activity/ supply is not meant predominantly for use other than commerce, industry or any other business or profession - taxable under GST @ 18% Visit to Get Source Income Tax Interest on Car Loan for Business Use Cannot Be Disallowed Due to Other Fund Allocations by Taxpayer. Case-Laws - AT : Disallowance of interest on car loan - used for business/profession - merely because the assessee placed his own funds and also the interest free loans for some other purposes, is not open for the AO to disallow the interest on the amount taken for business purpose Visit to Get Source Unexplained Share Premiums Taxable Under Income Tax Act Section 68, Amended by Finance Act 2013. Case-Laws - AT : Unexplained credit u/s. 68 - taxability of Share premium - Section 56(2)(vii)(b) was inserted by the Finance Act, 2013 with effect from 01.04.2013 - amendment will apply from AY 2013-14 Visit to Get Source CIT(A) Must Reassess Income u/ss 144, 68, and 56(2)(viia) After Initial Order Set Aside for Review. Case-Laws - AT : Best judgment assessment u/s 144 - addition u/s 68 - The learned CIT(A) ought to have stepped into shoes of the AO to compute income chargeable to tax due to non co-operation of assessee in assessment - It was also incumbent on CIT(A) to have looked into applicability of provisions of Section 56(2)(viia) to transaction for purchase of equity shares - CIT(A) order set aside Visit to Get Source Wharfage Charges Not Rent: No TDS u/s 194I, Deductible u/s 37(1) for Loading/Unloading Goods. Case-Laws - AT : Disallowance u/s 40(a)(ia) of Wharfage charges - Wharfage charges paid by assessee are charges which facilitate the loading / unloading of goods at waterfront - no use of land but even if it was held that there is any use of land, then the same was incidental - cannot be equated to be a charge for ‘rent’ for use of water - No TDS u/s 194I - allowed as deduction u/s 37(1) Visit to Get Source Company's Income from Projects in India Classified as Business Profit, Not Royalty, Due to Permanent Establishment. Case-Laws - AT : Taxability of Royalty Income & FTS - assessee had accepted a PE in India - being a member of consortium, the appellant company cannot pay royalty to itself and, therefore, the share received from the execution of the three projects is business profit Visit to Get Source Stay Granted on Tax Demand Pending Reversal of CIT(A) Order Favoring Another Taxpayer. Case-Laws - HC : Stay petition - unconditional stay of entire demand - ground on which the AO has made additions in the order of assessment, is already decided in favour of some other Assessee by the CIT(A) in other proceedings - stay granted till reversal of above order Visit to Get Source Section 260A: Appeals in Tax Cases Only on Significant Legal Issues, Not Factual Disputes for Judicial Focus. Case-Laws - HC : Scope of Section 260A - substantial question of law - It is only if the findings recorded by the Tribunal, on facts, is based on no evidence, or the findings are perverse, would it give rise to a substantial question of law warranting interference in proceedings u/s 260A Visit to Get Source Tax Case: 50% Depreciation Disallowed u/s 32(1)(iia) for Assets Used Less Than 180 Days. Case-Laws - AT : Disallowance of Additional Depreciation u/s 32(1)(iia) - 50 % (@ 10%) disallowed being used less than 180 days - balance additional depreciation @ 10% on such new plant and machinery will be allowed in immediately succeeding year - insertion of third proviso to Section 32(1) by Finance Act, 2015 w.e.f. 01.04.2016 is clarificatory in nature Visit to Get Source Section 54B Deduction Denied for Investing in Two Lands After Selling One; Only Single Land Investment Qualifies. Case-Laws - AT : Deduction u/s 54B - capital gain on sale of one agricultural land - investment made in two agricultural land - deduction is not allowable in respect of two separate investments in agricultural lands made by the assessee consequent to selling of one agricultural land Visit to Get Source Eligibility for Deductions u/s 80IC: Enhanced Profits from Disallowances Increase Eligible Business Profits for Tax Deductions. Case-Laws - AT : Deduction-u/s 80IC - enhanced profit due to disallowance - CBCT Circular No.37/2016 dated 02.11.2016 - disallowance made u/s 32, 40(a)(ia), 40A(3), 43B, etc. and other specific disallowances, related to the business activity result in enhancement of the profits of the eligible business - deduction under Chapter VI-A is admissible Visit to Get Source Customs Managing Director Penalized u/s 112 of Customs Act for Mis-declaration; Motives Considered Irrelevant. Case-Laws - AT : Imposition of penalty on Managing Director - the culmination of penalty under section 112 of Customs Act, 1962 commenced from confiscation of the goods as a consequence of admitted mis-declaration in which the motives are not relevant. Visit to Get Source Assessing Authority Must Follow Statutory Valuation Rules for Import Values Without Deviation. Case-Laws - SC : Application of valuation rules - comparing value with import from other countries - Once the statutory Rules exist and provide for sequential implementation, the assessing authority has no option but to proceed in accordance with those Rules, in that manner. Visit to Get Source Service Tax Service Tax Not Applicable: Mineral Transport from Mine to Railway Exempt from Cargo Handling Classification. Case-Laws - AT : Classification of service - Cargo Handling Service or otherwise? - activity of transportation of the minerals from the mine’s pithead to the railway siding (part of the mine) and loading the same into railway wagons - the essence of the contract is for transportation of mineral within the mining area - demand under the heading cargo handling services set aside. Visit to Get Source Central Excise Excise Valuation Excludes Packing Charges if Goods are Marketable Without Packing; Post-Manufacturing Process Clarified. Case-Laws - AT : Valuation - inclusion of packing and forwarding charges - The goods are otherwise marketable without packing and the same is done only at the request of the customers. The activity being a post manufacturing activity, the value of such packing material is not includible in the assessable value. Visit to Get Source CENVAT Credit Used for Central Excise Duty on Pre-stressed Sleepers, Revenue Challenges Lack of Manufacturing Connection. Case-Laws - AT : Utilization of CENVAT Credit - case of Revenue is that cenvat credit availed by them has been utilized by them towards payment of Central Excise Duty on Pre-stressed Sleepers which has no nexus with the manufacturing activity - there is no bar in cross utilization. Visit to Get Source CENVAT Credit Reversal Not Required for By-Products or Waste in Manufacturing Dutiable Goods Post-Rule 6 Amendment. Case-Laws - AT : Reversal of CENVAT Credit - exempt goods or not - even after the amendment from 01.03.2015, Rule 6 shall not applicable to by-products/waste products produced during the manufacture of dutiable final products. Visit to Get Source Case Laws: GST 2019 (4) TMI 1451 Levy of GST - activity of providing the hostel on rent to various boarder - whether the hostel will be covered under the hotel, inn guest house, club or campsite or not. In this regard the term hostel is neither defined in any of GST Acts? - HELD THAT:- On observation of documents/brochure/submitted by the applicant it is evident that the girls residing in both the hostels are provided with various facilities like food supply from canteen, parking space, coaching, library, entertainment which are all taxable supplies. Apart from above they are also provided with the provision of guest rooms for visiting parents of the occupants. All the facilities are only for the occupants of the hostels. The girls residing there are neither allowed to have food from outside nor are outsiders allowed to have food from hostel canteen. Thus the accommodation facility at hostel is the only principal supply and all the other facilities are inter-related as they are provided exclusively to the occupants of hostel only, without any extra charge. It has categorically been stated by the applicant that no other charges other than above amount is collected from the occupants on account of other allied facilities being provided. The amount received for providing taxable supplies in hostel under Notification No. 12/2017 (Rate) illustrating lodging purposes, having declared tariff of a unit of accommodation below one thousand rupees per day or equivalent are exempt. The lump sum amount received per unit (bed) per day against the accommodation services in hostel is to be treated as exempt supply. The amount received for providing taxable supplies in hostel under Notification No. 12/2017 (Rate) illustrating lodging purposes, having declared tariff of a unit of accommodation below one thousand rupees per day or equivalent are exempt. The lump sum amount received per unit (bed) per day against the accommodation services in hostel is to be treated as exempt supply. 2019 (4) TMI 1449 Classification of service - royalty paid in respect of mining lease - whether classified under Licensing for the right to use minerals including its exploration and evaluation falling under the heading 9973 attracting GST at the same rate of tax as applicable on supply of like goods involving transfer of title in goods ? - HELD THAT:- There is no ambiguity that M/s NMDC pays royalty for its business of iron ore extraction and also pays to both the trusts i.e. DMF and NMET in the course of furtherance of this business only. By no stretch of imagination, this can be treated as donation. In case of failure to contribute to the above trusts, the business/rights of iron ore extraction would legally get hampered. Whereas, donations are always voluntary here in the instant case there is compulsory payment to both the trusts in proportion to the amount of royalty. Thus there hardly remains any doubt that the contributions paid by M/s NMDC to both the trusts are amounts being paid in the course of furtherance of its business activities only. The way in which a Collector of a District enters into an agreement/contract to gain royalty from mining lease of the Government land, in the same way he enters into an agreement with NMDC to make it contribute to both the trusts in addition to royalty. Thus both the trusts uphold parallel rights on ownership rights on Government land with regard to royalty of mining lease. Accordingly, owing to above discussions it gets concluded that the contribution made by M/s NMDC to DMF and NMET merits treatment as mining royalty in the course or furtherance of business of M/s NMDC. Liability to pay tax - contributions made to District Mineral Foundation (DMF) and National Mineral Exploration trust (NMET) as per MMDR Act, 1957 - HELD THAT:- The above mentioned activities are compulsorily to be performed by both the trusts which have been enumerated under Article 243G and 243W of the Indian Constitution to be performed by Panchayats and Municipalities respectively. Thus in terms of section 2(69) of GST Act, both DMF and NMET qualify being treated as local authority and on the basis of state Notification No. 13/2017 dated 28-06-2017 there arises the liability of payment of GST upon M/s NMDC, on the contributions made of DMF and NMET under reverse charge basis. 2019 (4) TMI 1448 Release of detained goods with Truck - detention on the ground that Part-B of the E-way bills was not generated - validity of SCN - HELD THAT:- A perusal of the impugned order dated 2.4.2019 passed by the second respondent in FORM GST MOV-09 whereby tax and penalty have been demanded, reveals that the basis for computing the additional tax is the IGST paid by the petitioners. Moreover, in the impugned order there is not even a whisper as regards the submissions advanced on behalf of the petitioners, nor have the same been dealt with in the body of the order. No reasons have been assigned by the second respondent for the purpose of holding the petitioner liable to payment of tax and penalty despite the fact that IGST had already been paid on such transaction and the goods were being moved from the customs warehouse to the petitioner s own godown and it being the case of the petitioners that there was no supply, and hence, the provisions of GST Act are not applicable. The impugned order is, therefore, totally bereft of any reasoning. Reasons, it is well known, are the heart and soul of an order passed by a judicial/quasi-judicial order, without which it is difficult to pronounce one way or other as regards the validity of such order - the matter is required to be restored to the file of the second respondent for deciding the same afresh in accordance with law. 2019 (4) TMI 1447 Rate of GST - Composite supply - supply under the contract is given to a Central Government by the applicant - HELD THAT:- It is clear that the activity is a work contract supply undertaken for Central Government. The limitation under this notification is that activity/ supply is meant predominantly for use other than commerce, industry or any other business or profession. The activity thus may fall under the definition of business as NFC is engaged in manufacture and enrichment of fuel which will ultimately be used for production of electricity. The activity of manufacture of fuel from NFC is thus leading to ultimate production and distribution of electricity which is a commercial activity - The supply thus provided by the applicant to the NFC is a Works Contract Service (construction service) falling at Serial No. 3(xii) of Notification No. 11/2017-CT (Rate) dated 28.06.2017 as amended from time to time and will attract GST @ 18%. 2019 (4) TMI 1446 Classification of supply - Rate of GST - Supply of goods or services? - activity of O M of Fluoride control project on ESCO Model and O M work supply of goods or supply of services - HELD THAT:- The scope of work in ESCO model requires improvement of the whole water supply system involving pump houses, pumping stations, transmission lines, switchyards, storage tanks and headwork campus. Re-modelling of pump foundation and extension of pump house, replacement of fittings/fixtures and painting of all permanent structures like pumping station building etc. are involved in the contract. Since composite supply of works contract has been specifically classified as supply of service under Schedule Il, it should be first analysed whether the contract can be classified as a works contract or not. The given work is a contract for improvement of the pumping system under the Fluoride control project, wherein transfer of property in goods in the form of new pumping machinery and mechanical/ electrical equipment shall be involved in the execution of such contract - That Works contract in itself is a composite supply in which construction, fabrication, completion, erection, installation, fitting out, improvement, modification, repair, maintenance, renovation, alteration or commissioning etc are involved along with transfer or property in goods. The activity of O M of Fluoride Control Project on ESCO Model and O M work by the applicant is being undertaken for a Government Department. In this activity of Composite supply of goods and services if supply of goods is below 25% out of total value of supply then GST will be NIL and if more than 25% of the total value of supply then GST will be @12%. 2019 (4) TMI 1445 Application for withdrawal of Advance Ruling application - rate of GST - manufacturer of bus body building - HELD THAT:- Since the applicant has withdrawn the application, therefore no ruling is given. Income Tax 2019 (4) TMI 1442 Disallowance being the front end fees or processing fees for obtaining loan - capital or revenue or deferred revenue expenditure - front end fee is part of interest u/s 2(28A) - assessee claimed amortization of the expense u/s 35D - HELD THAT:- Issue similar to the case of the assessee relating to assessment year 2004-05 [ 2019 (4) TMI 1321 - CALCUTTA HIGH COURT] interest payment was spread over the duration of the loan. Therefore, the front ends fee constituted interest liability of the assessee spread over a period of time. Obtaining the loan and paying interest to service it ensured long term benefit to the assessee. Hence, this expenditure was revenue and not capital - Decided in favour of assessee. Allowable revenue expenditure - Deduction on payment of premium of pre payment of the loan to reduce its interest burden in view of falling interest rate - HELD THAT:- Aforesaid expenditure incurred by the assessee by way of premium paid on pre-payment of loan for reducing interest the liability cannot be called acquisition of any asset and cannot be treated as capital expenditure and it has to be allowed as revenue expenditure. For the aforesaid reason this appeal is dismissed and accordingly question no. 1 is answered in negative and in favour of assessee and against the revenue. 2019 (4) TMI 1441 Stay petition - non disposal of stay application and appeal by appellate authority - HELD THAT:- The assessee has not co-operated with the assessing officer while the assessment was undertaken and the assessment order passed. According to him, prima facie as things stand at present the order does not suffer from any infirmity and prays for dismissing this writ petition. The counsel, does not object to directing disposal of the stay petition at the earliest; however he insists upon the condition to deposit 20%, and that the petitioner can avail the benefit of the stay and the appeal could also be disposed of expeditiously. Writ prayer is substantially against the inaction of the appellate authority/ the third respondent in disposing of Ext.P7 stay petition and Ext.P2 appeal. ORDER :- The third respondent considers and disposes of Ext.P7 stay petition as expeditiously as possible, preferably within two months from the date of receipt of the copy of this judgment. The petitioner is directed to deposit 10% of the amount demanded through Ext.P2 within four weeks from today and files proof of payment before the third respondent to enable the third respondent to consider the stay application. 2019 (4) TMI 1440 Stay petition - unconditional stay of entire demand - HELD THAT:- Undisputed position that the ground on which the Assessing Officer has made additions in the order of assessment giving rise to the tax demand, is already decided in favour of some other Assessee by the Appellate Commissioner in other proceedings. Even though this Assessee in such Appellate proceedings is not the Petitioner, nevertheless, if the facts and law are identical, there is no reason why the present Petitioners also should not get the benefit of such Appellate order passed by the Commissioner in case of another Assessee. It is entirely open for the Department to carry the challenge against the order of Appellate Commissioner before the Tribunal. However, till such order is reversed by the Tribunal, the effect of such order would continue to apply. In view of the Appellate order, which is in force presently, the Department cannot take a stand that such order has no binding effect or that said order should be ignored for the purpose of deciding the condition of deposit of tax pending Appeal. ORDER: (i) There shall be unconditional stay against the recovery of tax pending Appeals. (ii) If the order of the Commissioner (Appeals) in case of Scheme A1 of ARCIL CPS 002 XI Trust is reversed by the Tribunal, it would be open for the Principal Commissioner of Income Tax to impose a suitable condition for the Assessee to deposit tax pending Appeals, which order shall be passed after giving a reasonable opportunity of hearing to the Petitioner. (iii) The Petitioners shall not contribute to any delay in disposal of the Appeals. If in the opinion of the Department, the Petitioners are responsible for delay in disposal of the Appeals, it would be open for the Department to apply for recalling this order. 2019 (4) TMI 1439 Claim under section 10A on units on which deduction u/s 80HHE as claimed - double deduction - method of computation of deduction u/s 10A - HELD THAT:- What subsection (5) of section 80 HHE thus prohibits is the claim of deduction allowed u/s 80HHE under any other provision, be it in the same assessment year or in other assessment year. In the present case, it is not even the ground of the revenue that the deduction u/s 10A claimed by the assessee in the present year is in relation to profit for which the assessee was granted deduction under section 80HHE. Sub-section 5 of section 80 HHE, therefore, in the present case would have no applicability. In our view by a division bench judgement of Delhi High Court in the case of Commissioner Income Tax Vs. Damco Solutions Pvt. Ltd. . [ 2010 (10) TMI 592 - DELHI HIGH COURT]. The assessee had admittedly started manufacturing computer software for export prior to 1st April 2001, when section 10A was substituted by the Finance Act of 2000. It was under this amendment that the profit and gains derived by an undertaking from export of computer software came to be covered for deduction u/s 10A. The revenue contends that this benefit would not be available to an industry which was already existing and engaged in such activity. The interpretation of the revenue would render the first proviso to subsection (1) of section 10A wholly redundant This proviso would apply to an industry which was already in existence, engaged in manufacturing and export of computer software when the said amendment was made in section 10A. However, such an industry would be eligible to claim that deduction in relation to profit and gain arising out of such activity only for remainder of the period of 10 assessment years, which could be claimed for consequent assessment years alone. Computation of benefit of section 10A - HELD THAT:- Issue is squarely covered by the judgement of Supreme Court in the case of Commissioner of Income Tax Vs. HCL Technologies, . [ 2018 (5) TMI 357 - SUPREME COURT] in which the Court held that the total turnover for the purpose of section 10 of the Act cannot be understood as defined for the purpose of section 80 HHE. It was further held that thus the expenses which are to be excluded from the export turnover, would also have to be excluded for the purpose of computing total turnover. 2019 (4) TMI 1438 Deduction u/s 80IC on the entire eligible income - deduction u/s 80IC denied by the AO on increased profit on allegation of inflated purchases - HELD THAT:- Deduction u/s 80IC is, admittedly, available to the undertaking of the assessee. The deduction therein is 100% of the profits. As has been held both by the CIT (Appeals), and the Tribunal, even if a part of the purchases made by the assessee is held ineligible for deduction it would only result in an increase in the profits of the undertaking; and, since the entire profits of an undertaking is eligible for deduction u/s 80IC it mattered little whether or not a portion of the purchases, effected by the assessee, was disallowed. While we are satisfied that the deduction allowed by the CIT (Appeals), as confirmed by the Tribunal, does not necessitate interfere in an appeal u/s 260A as noted by the Tribunal, in the order under appeal, the assessee, in the present case, had claimed deduction towards purchases made by him. These deductions were disallowed by the Assessing Authority. Since the assessee had made such a claim for deduction, the Tribunal has rightly held that Section 80A(5) of the Act is not applicable. Scope of Section 260A - substantial question of law - HELD THAT:- Interference, u/s 260A of the Act, is justified only if the appeal gives rise to a substantial question of law. It is only if the findings recorded by the Tribunal, on facts, is based on no evidence, or the findings are perverse, would it give rise to a substantial question of law warranting interference in proceedings u/s 260A. We find no such infirmity in the order under appeal. 2019 (4) TMI 1437 Revision u/s 263 - Show cause notice issued by the CIT (International Taxation) exercising jurisdiction under Section 263 - HELD THAT:- While we find no basis for the appellant-writ petitioner s apprehension that the Commissioner would ignore the contentions put forth by them in their reply to the show cause notice, merely on account of the observations made by the learned Single Judge in the order suffice it to direct the Commissioner, Income Tax to consider the appellant-writ petitioner s reply to the show cause notice, and pass a reasoned order thereupon taking into account the contentions put forth in the reply, uninfluenced by any observations made either in the order under appeal or in the order now passed by us. 2019 (4) TMI 1436 Disallowance of interest - HELD THAT:- It is clear that AO disallowed the interest because the issue is similar as has been considered in AY 2009-10. In AY 2009-10 the Tribunal deleted the similar additions. We, therefore, following the reasons for decision for AY 2009-10 (supra) found that issue is covered in favour of the assessee. We, accordingly, set aside the orders of the authorities below and delete the addition. Disallowance u/s 14A read with Rule 8D(2)(iii) - assessee has earned income exempt from tax from dividends - assessee was asked to give details and justify the claim in view of section 14A read with Rule 8D with reference to the dividend income - HELD THAT:- As decided in assessee s own case AY 2009-10 there is no proper record of satisfaction as to the expenses incurred by the assessee for earning the exempt income. By following the decision reported in CIT vs. Taikisha Engineering India Ltd. [ 2014 (12) TMI 482 - DELHI HIGH COURT] and Joint Investments (P) Ltd. vs. CIT [ 2015 (3) TMI 155 - DELHI HIGH COURT] , we are of the opinion that the AO at the first instance should have examined the correctness of the statement made by the assessee that no expenses were incurred for earning the exempt income during the year and if and only if the Ld. AO is not satisfied on this account after making reference to the accounts, he is entitled to adopt the method under Rule 8D of the Rules. While allowing the plea of the assessee direct AO to delete the addition made on this score also. Ad hoc disallowance on account of telephone and vehicle expenses - 1/8th of these expenses was disallowed u/s 37(1) being of personal nature - CIT(A) restricted the addition to 1/10th of the expenses claimed - HELD THAT:- Entire addition is wholly unjustified. The AO has not pointed out on which items personal element was involved in claiming the aforesaid expenses. AO has not pointed out any specific item which is used by the assessee for personal purposes. It is ad hoc addition made by the AO by disallowing 1/8th out of these expenditures. It is well settled law that ad hoc addition cannot be sustained unless AO has pointed out any specific item in which personal element is involved. There was thus, no justification to make any disallowance out of these expenditures. We, accordingly, set aside the orders of the authorities below and delete the entire addition. Addition on account of electricity and water expenses - assessee has not apportioned the expenses having personal element in view of residence-cum-office nature of premises. The assessee has not installed separate electricity meter for residence and office. The assessee has also not shown such expenses in drawing account - HELD THAT:- No justification to interfere with the order of Ld. CIT(A) in sustaining the part addition . This ground is accordingly, dismissed. Revenue expenses claimed on account of upgradation/ subscription of software - HELD THAT:- Matter requires reconsideration at the level of the AO. AO has not pointed out as to which capital has been generated out of the aforesaid expenses incurred by the assessee for the purpose of profession of the assessee. AO has also not pointed out that after incurring the expenditure how the same could be considered enduring in nature. Assessee pointed out the details noted in the bills/vouchers of these expenses shows that the matter requires reconsideration at the level of the AO. We, accordingly, set aside the orders of the authorities below and restore this issue to the file of AO with direction to re-decide the issue after giving an opportunity of being heard to the assessee, after verifying the bills and vouchers produced on this issue. This ground is allowed for statistical purposes. 2019 (4) TMI 1435 Approval u/s 80G(5)(vi) - registration u/s 12A granted to assessee recently - request for approval under section 80G(5)(vi) is treated as premature - HELD THAT:- The issue is covered by the Order in the case of Bharat Bhushan Jain Charitable Trust vs. CIT (Exemptions), New Delhi [ 2019 (2) TMI 712 - ITAT DELHI] . In the present case also assessee has been granting registration under section 12A , therefore, Ld. CIT(E) was satisfied about the charitable activities carried out by the assessee and the objects of the assessee are charitable in nature. Therefore, assessee is entitled for approval under section 80G(5) - direct the Ld. CIT(E) to grant approval/exemption to the assessee under section 80G(5), from the date of application. - Decided in favour of assessee 2019 (4) TMI 1434 Non prosecution of appeal - Levy of penalty u/s 271(1)(c) - assessee filed return of income declaring loss - A.O. made addition on account of unexplained cash credit - HELD THAT:- The assessee has been notified the date of hearing through registered post. However, none appeared on behalf of the assessee at the time of hearing of the appeal. Assessee is no more interested in prosecuting the appeal. Therefore, the appeal of the assessee is liable to be dismissed as un-admitted. Having regard to Rule 19(2) of Income Tax Appellate Tribunal Rules and following various decisions of Delhi Bench of the Tribunal including that of Multiplan India Ltd., [ 1991 (5) TMI 120 - ITAT DELHI-D] ; Estate of Late Tukojirao Holkar vs. CWT [1996 (3) TMI 92 - MADHYA PRADESH HIGH COURT] and CIT vs. B. Bhattachargee Another [ 1979 (5) TMI 4 - SUPREME COURT] wherein held that the appeal does not mean, mere filing of the memo of appeal but effectively pursuing the same . In view of the above, respectfully following the aforecited decisions, we dismiss the appeal of the assessee as un-admitted. 2019 (4) TMI 1433 Receipts by way of entrance fees and membership fees - capital receipts or revenue receipts - whether these receipts are refundable when the member surrender its membership or ceases to be member - HELD THAT:- Issue requires verification of contentions of the assessee dehors records including bye laws, application for becoming members, minutes of meetings etc. The decision of Citizen Co-operative Society Limited v. ACIT [ 2018 (1) TMI 290 - SUPREME COURT OF INDIA] is relevant. End of justice will be met if the issues in these appeals are restored to the file of the A.O for fresh adjudication after considering various clauses of bye laws concerning different types of membership and rights attached thereto, application forms for making members and other terms and conditions governing various types of membership including entitlements on becoming member , refund of entrance fees and membership fee on cessation of being member of the assessee, minutes of meetings etc. AO is directed to give proper and adequate opportunity of being heard to the assessee in accordance with principles of natural justice in accordance with law. 2019 (4) TMI 1432 Disallowance of Additional Depreciation u/s 32(1)(iia) - use less tan 180 days - addition to the tune of 50% of stipulated rate of 20% i.e. 10% with respect to new plant and machinery which was acquired and put to use for less than 180 days - entitlement for balance 50% in the subsequent assessment year - HELD THAT:- Assessee has acquired and installed new plant and machineries during the year under consideration which undisputedly are entitled for additional depreciation under Sec.32(1)(iia) of 20% , but since the Plant and Machinery were put to use for less than 180 days in AY 2012-13, the authorities below rightly allowed additional depreciation @ 50% of the stipulated rate of additional depreciation of 20% i.e. 10% keeping in view second proviso to Section 32(1) during the impugned assessment year, as against stipulated rate of additional depreciation on new plant and machinery of 20% provided under Section 32(1)(iia) of the 1961 Act , hence consequently balance additional depreciation @ 10% on such new plant and machinery will be allowed in immediately succeeding year i.e A.Y. 2013-14, subject to verification by the AO. On the same analogy what remained to be allowed in immediately preceding assessment year i.e. AY 2011-12 i.e. additional depreciation @10% ( being 50% of stipulated rate of 20%) on the ground that new plant and machinery acquired during AY 2011-12 was put to use for less than 180 days , the remaining claim of depreciation @10% shall be allowed in the year under consideration , subject to verification by the AO. Amendment brought in statute in Section 32 of the 1961 Act by insertion of third proviso to Section 32(1) by Finance Act, 2015 w.e.f. 01.04.2016, wherein it is provided that the assessee will be entitled for claiming rest of the additional depreciation in immediately succeeding year which could not be allowed in the year of acquisition on the ground that the said new plant and machinery was put to use for less than 180 days. The Hon ble Madras High Court in the case of CIT v. T.P.Textiles Private Limited [ 2017 (3) TMI 739 - MADRAS HIGH COURT] has held the said proviso to be clarificatory in nature Respectfully following decision of the tribunal in assessee s own case [ 2018 (2) TMI 1879 - ITAT MUMBAI] , we allow ground raised by the assessee in its appeal for AY. 2012-13, subject to limited verification by the AO as to correctness of the amounts so claimed in two successive years. On the same analogy, the claim of additional depreciation u/s 32(1)(iia) of the 1961 Act which stood disallowed in AY 2011-12 on the ground of user of new plant and machinery for a period of less than 180 days keeping in view second proviso to Section 32(1) of the 1961 Act , shall be allowed in the impugned assessment year subject to limited verification by the AO as to correctness of the amounts so claimed in two successive years.. The appeal of the assessee is partly allowed as indicated above 2019 (4) TMI 1431 Disallowance u/s 40(a)(ia) - Wharfage charges paid to Maharashtra Maritime Board - TDS u/s 194I - whether Wharfage fees is akin to rent as described in section 194-I or is akin to duty or cess - deduction u/s 37(1) - as per revenue, land includes water and since Wharfage charges are paid for utilizing water space, the assessee was obliged to deduct TDS - HELD THAT:- We hold that Wharfage charges paid by the assessee which are charged on the basis of weight of the ship and not in a mechanical manner, cannot be equated to be a charge for rent for use of water. The Hon ble Supreme Court in the case of Japan Airlines Co. Ltd. Vs. CIT and CIT Vs. Singapore Airlines Ltd. [ 2015 (8) TMI 185 - SUPREME COURT] had also referred to the definition of rent and whether the assessee airlines which was landing and paying parking charges to the Airport Authority of India for facility at an airport can be held to be to have paid the amount for simple use of land and hence, liable for deduction of tax at source. Payment was for services and facilities in connection with aircraft operations at the airport in accordance with international protocols and the Airport Authority was providing these facilities for landing and takeoff of aircrafts and in the whole process, use of land was incidental. On the contrary, where the protocol prescribe detailed methodology for fixing these charges, the charges were not for use of land perse and therefore, could not be treated as rent within meaning of section 194-I. Applying the ratio to the facts of present case, in view of the dictate of the Apex Court (supra), we hold that Wharfage charges paid by assessee are charges which facilitate the loading / unloading of goods at waterfront and for providing facilities, Wharfage charges are charged from the assessee and in such case, we hold that there is no use of land but even if it was held that there is any use of land, then the same was incidental but such payments could not be treated as rent and the assessee be liable to deduct tax at source under section 194-I. The Wharfage charges paid by assessee are to be allowed as deduction u/s 37(1) . The ground assessee is allowed. Allowability of foreign travel and salary expenses of employees of sister concern deputed to assessee - HELD THAT:- The assessee claimed that it was not having full-fledged enhanced administration and marketing set up, for which staff of group companies were deputed as and when there was requirement. Since the staff so deputed actually works on the task relating to assessee s business, remuneration payable to such employees was reimbursed by the assessee and expenditure so incurred was booked and was for the purpose of carrying on the business of assessee company. In this regard, the assessee had also furnished Resolution passed by Chowgule group for deputation of two main persons, who were also taking care of the bank operations of assessee company. The expenditure thus, being incurred for legitimate and genuine business needs of assessee company and for smooth flow of carrying on the business is to be allowed as expenditure in the hands of assessee u/s 37(1) . Accordingly, we hold so and direct the Assessing Officer to allow the said expenditure. Further, certain foreign travel expenses were incurred by the said employees to explore the new business opportunities and also to see port facilities made available for efficient operations. Necessary confirmation in this regard was filed before the authorities below, which has been brushed aside. We find no merit in the disallowance made by authorities below and direct the Assessing Officer to allow foreign travel expenses of Mr. M.P. Patwardhan and Mr. Atul Kulkarni. Disallowance made u/s 40A(3) - HELD THAT:- No merit in the orders of authorities below in this regard. In view of provisions of Rule 6DD(k) r.w.s. 40A(3) in case of expenditure being incurred at remote areas, the same merits to be allowed in the hands of assessee. We are deciding this issue in favour of assessee because of smallness of the quantum involved. The grounds of appeal raised by assessee are thus, partly allowed. 2019 (4) TMI 1430 Best judgment assessment u/s 144 - addition towards unsecured loan and sundry creditors are made u/s 68 - CIT(A) deleted after admitting addition evidence - one liability relates to acquisition of share from sister concern - AO raised applicability of Section 56(2)(viia) - HELD THAT:- It is undisputed that powers of learned CIT(A) is co-terminus with the powers of learned AO , including power of enhancement of assessment keeping in view provisions of Section 251. The learned CIT(A) deleted the additions without applying his independent mind and without addressing the comments of the AO. The learned CIT(A) did not appreciated that the assessee did not co-operated during assessment proceedings and the AO was left to frame best judgment assessment u/s 144 in the absence of the assessee. The additions were made by the AO based on material available on record while framing assessment u/s 144 originally. It was incumbent on the part of learned CIT(A) to have made proper enquiries and to satisfy independently as to the satisfaction of the ingredients of Section 68 w.r.t these unsecured loans and sundry creditors. It was also incumbent on the part of learned CIT(A) to have looked into applicability of provisions of Section 56(2)(viia) to transaction for purchase of equity shares of M/s M/s Asmeeta Infratech Private Limited by the assessee from M/s Kanchan Developers Private Limited and Malav Shah, to verify whether any income chargeable to income-tax within provisions of the 1961 Act has arisen which needed to be brought to tax. The learned CIT(A) in the instant case keeping in view circumstances of the case ought to have stepped into shoes of the AO to compute income chargeable to tax keeping in view conduct of the assessee during the course of assessment proceedings of non co-operating with the AO or should have directed the AO to do the same. The decision of Hon ble Delhi High Court in the case of CIT v. Jansampark Advertising and Marketing Private Limited [ 2015 (3) TMI 410 - DELHI HIGH COURT] is relevant. Under these circumstances, we are of the view that the appellate order of learned CIT(A) is clearly not sustainable in the eyes of law which we are inclined to set aside. We are of the considered view keeping in view facts and circumstances of the case that the matter need to be set aside to the file of the AO for framing fresh assessment denovo . 2019 (4) TMI 1429 Disallowance of expenditure incurred towards gift and sales promotions - reason for making an ad hoc disallowance of 40% is, CBDT Circular no.5/2012, dated 1st August 2012, wherein, the prohibition imposed by Indian Medical Council with regard to acceptance of gift by medical practitioner / doctor was imposed w.e.f. 10th December 2009 - HELD THAT:- Prohibition imposed by Indian Medical Council against acceptance of gift is on the medical practitioner and doctor and not on the pharmaceutical companies. The applicability of the aforesaid CBDT Circular as well as prohibition imposed by Indian Council on Pharmaceutical companies came up for judicial scrutiny before the Tribunal in DCIT v/s PHL Pharma Pvt. Ltd. [ 2017 (1) TMI 771 - ITAT MUMBAI] after examining the regulation issued by the Medical Council of India as well as the CBDT Circular referred to above, ultimately concluded that the prohibition imposed by the Indian Medical Council Regulation are not applicable to pharmaceutical companies. The said view was again reiterated by the Co ordinate Bench in Solvay Pharma India Ltd. [ 2018 (1) TMI 797 - ITAT MUMBAI] . The Co ordinate Bench has also held that the CBDT Circular referred to by the Departmental Authorities will not apply retrospectively. No contrary decision on the issue has been brought to our notice by the learned Departmental Representative. In view of the aforesaid, following the ratio laid down by the Co ordinate Bench in the decisions referred to above, we allow assessee s claim of expenditure Disallowance u/s 14A under rule 8D(2)(ii) - sufficient interest free funds - HELD THAT:- Assessee had sufficient interest free funds available with it to take care of the investments. That being the case, disallowance of interest expenditure under rule 8D(2)(ii) cannot be made. However, to keep track of its investments and manage the funds, the assessee must be incurring certain administrative expenditure .Reasonable disallowance under section 14A r/w rule 8D(2)(iii) has to be made. Accordingly, we direct the Assessing Officer to compute the disallowance of administrative expenditure under rule 8D(2)(iii) after excluding from the average value of investment, the investments which have not yielded any exempt income during the financial year relevant to assessment year under dispute. This ground is partly allowed. Determination of arm s length price of corporate guarantee given to the AE - assessee has provided corporate guarantee to its overseas AE without charging any fees - show cause notice to the assessee to explain why arm s length price of corporate guarantee fee should not be determined - HELD THAT:- In many of the cases, the assessees have accepted provision of corporate guarantee as international transaction under section 92B of the Act. In one of such cases viz. Everest Kanto Cylinders Ltd., [ 2015 (5) TMI 395 - BOMBAY HIGH COURT] has upheld the decision of the Tribunal in computing the arm s length price of corporate guarantee fee @ 0.5%. Following the aforesaid decision we direct the Assessing Officer to determine the arm s length price of corporate guarantee fee by applying the rate of 0.5%. This ground is partly allowed. Deduction claimed u/s 10B on the turnover of scrap sales - HELD THAT:- While deciding similar issue in assessee s own case for the preceding assessment years, the Tribunal has held that since the sale of scrap is integrally connected to the business activity of the assessee, it should form part of the turnover for computing deduction under section 80IB/10B. Commissioner (Appeals) accepting the aforesaid legal position has directed the AO to allow deduction under section 80IB / 10B of the Act. However, he has wrongly quantified the amount which is the scrap sales relating to 80IB unit, while leaving out the scrap sales of 10B unit. We direct the Assessing Officer to allow assessee s claim of deduction under section 10B / 80IB on the respective sales turnover of scrap relating to the aforesaid units. This ground is allowed. 2019 (4) TMI 1428 Taxability of Royalty Income FTS - assessee offer to tax @ 10% on gross basis on royalty FTS - AO treat the same as business profit - India Russia DTAA - assessee had accepted that since it has branch office in India it constitutes a PE in India within the meaning of Article 5 of the DTAA. - HELD THAT:- To sum up, being a member of consortium, the appellant company cannot pay royalty to itself and, therefore, the share received from the execution of the three projects is business profit of the appellant company. Since there is no transfer of any technical know-how and even if the services are rendered in India by the head office and not by the branch office, then also, the revenue of the appellant company cannot be bifurcated as royalty and fees for technical services. Moreover, the entire payment received during the year has to be attributable to the PE in India, and, therefore, the same is taxable as business profit. Since the assessee is having PE in India, Article 12 of the DTAA between India and Russia is not applicable. Therefore, the findings of the lower authorities cannot be faulted with. Attribution of Income and allowance of expenses incurred by the Head Office - HELD THAT:- There is no dispute that the appellant company is having a PE in India. Therefore, whatever income the appellant company has earned from the projects has been earned through its PE. Therefore, the whole of the profit of the appellant company is attributable to its PE and since the expenses have already been allowed, incurred for the purpose of the PE, therefore, there is no need to tamper with the findings of the CIT(A) in the light of Article 7(3) of the India Russia DTAA. Transit Office Facility Expenses - HELD THAT:- AR stated that since the payments have been made to sovereign [Russian Embassy], there was no occasion to deduct tax at source. There is no dispute that the impugned amount has been paid to Russian Embassy as cost of accommodation to the Russian Employees. But the least the appellant company could have provided is the confirmation from Russian Embassy itself. We, therefore, allow one more opportunity to the appellant company to furnish the confirmations from the Russian Embassy in this regard. The appeals of the assessee are partly allowed for statistical purposes. Interest u/s 234B - HELD THAT:- This issue is covered in favour of the assessee and against the Revenue by the judgment of the Hon ble Jurisdictional High Court in the case of GE Packaged Power Inc. [ 2015 (1) TMI 1168 - DELHI HIGH COURT] no interest is leviable on the respondent assessees under Section 234B, even though they filed returns declaring NIL income at the stage of reassessment. The payers were obliged to determine whether the assessee were liable to tax under Section 195(1), and to what extent, by taking recourse to the mechanism provided in Section 195(2) of the Act. The failure of the payers to do so does not leave the Revenue without remedy; the payer may be regarded an assessee-in-default under Section 201, and the consequences delineated in that provision will visit the payer . Also see ZTE CORPORATION [ 2017 (1) TMI 1338 - DELHI HIGH COURT]. 2019 (4) TMI 1427 TP Adjustment - working capital adjustment - DRP specifically directed TPO to allow the working capital adjustment, which is not followed by the TPO - HELD THAT:- We, therefore, direct the AO/TPO to allow the working capital adjustment while determining the Arm s Length Price of the relevant international transactions of the assessee with its AE by following these specific directions given by the DRP. Assesese s appeal is accordingly allowed. Working capital requirements affect the margins and costs because this is an implication which is recovered /recoverable from the customers. Considering Rule 10B(30 and the facts in this case, working capital adjustment should be made provided reliable data is furnished by the assessee to the TPO. The claim for working capital adjustment has consistently been accepted in several decisions of the ITAT. Considering the facts, the TPO is directed to give working capital adjustment using the methodology given in Annexure to Chapter III of OECD guidelines and apply SBI Prime Lending rate (as on 30th June of the relevant financial year) as the interest rate. TP Adjustment in respect of other grounds - as submitted that if TPO allow the working capital adjustment as per the specific directions given by the DRP - difference between the ALP so computed and the price paid by the assessee would be within the permissible limit requiring no addition to be made to on account of TP Adjustment - HELD THAT:- As we have directed the Assessing Officer/TPO to allow such working capital adjustment as per the specific directions given by the DRP, the other grounds raised by the assessee in this appeal relating to the issue of Transfer Pricing Adjustment have become infructuous and even the ld. Counsel for the assessee has accepted this position. 2019 (4) TMI 1426 Income accrued in India - Royalty receipts taxability in India - as per AO provision of satellite transmission services to its customers fall under the royalty definition as given in Section 9(1)(vi) and Article 12 of the India USA - Assessee qualifies as a tax resident of USA in terms of Article 4 of DTAA - HELD THAT:- It is not the case of the revenue that any change of fundamental facts happened for these assessment year so as to distinguish the same from those of the earlier years. In the case of Asia Satellites [ 2011 (1) TMI 47 - DELHI HIGH COURT] upheld the contention of the assessee and even subsequent to the amendment of Section 9(1)(vi) by the Finance Act, 2012 with retrospective effect by way of Finance Act, 2012, when the revenue filed the review petition, the Hon ble High Court dismissed the review petition also. Further, post retrospective amendment by way of Finance Act, 2012 in Section 9(1)(vi) in the case of New Skies Satellite [ 2016 (2) TMI 415 - DELHI HIGH COURT] held that the condition with respect to taxability of satellite transmission services in India would remain the same for the DTAA and amendment to the Act with a retrospective or prospective cannot be read in a manner so as to extend the operation to the terms of international treaty. When the issue no longer remains res integra and there is no change in the fundamental facts permeating all these years, we are of the considered opinion, there would be no justification to take a different view from the consistent view taken for the earlier years. We, therefore, while respectfully following the above lines of decisions, held the issue in favour of the assessee and answer the issue stating that the income received by the assessee cannot be taxed as royalty in India. 2019 (4) TMI 1425 Time barring assessment - Period of limitation u/s 153 - applicability of Explanation-1 to sec. 153 - HELD THAT:- The Assessing Officer admittedly set sec. 148 re-opening mechanism in motion in identical four notices issued on 16.02.2016 which stood served on the taxpayer on 19.02.2016 followed by the impugned re-assessments framed on 08.11.2017. Section 153 of the Act prescribes time limit for completion of assessment, re-assessment re-computation. Sub-section 2 thereof makes it clear that no order of assessment, re-assessment or re-computation shall be made u/s 147 after expiry of nine months from the end of the financial year in which sec. 148 notice stood served. There can hardly be any dispute about nine months from the end of the financial year of such section 148 notice service dated 19.02.2016; last upto 31.12.2016. The Revenue s submission extracted hereinabove are fair enough to this effect. I therefore observe that last date of framing of reassessments in all these assessment years was 31.12.2016. I conclude in this factual backdrop that all the impugned re-assessments in these four assessment years are clearly time barred since framed on 08.11.2017 going by the above statutory provision. I quash the impugned re-assessments since not framed within statutory limitation period. - Revenue appeals are dismissed 2019 (4) TMI 1424 Reopening of assessment u/s 147 - absence of tangible material for formation of reasons to belief - HELD THAT:- Admittedly, the assessment is reopened within 4 years from the end of the assessment year. However even in the assessment falling within the period of 4 years from the end of the assessment year there has to be a tangible material coming into the possession of the assessing officer to reopen the cases. Such is the mandate of the honourable Supreme Court in case of Kelvinator s of India Ltd [ 2010 (1) TMI 11 - SUPREME COURT OF INDIA] . Therefore it is apparent that the reasons recorded by the learned assessing officer is on the appreciation of the same facts as was available before the assessing officer during the course of assessment proceedings under section 143 (3). AO has initiated the reassessment proceedings without any tangible material hence it does not deserve to be sustained. Hence, reassessment is quashed on this ground. Violation of the principles of natural justice - HELD THAT:- Assessee was provided the reasons only on 25/2/2013 asking to file an objection up to 4/3/2013 and the objections were disposed off on 8/3/2013 whereas the final assessment order based on the above reason was passed on 20/3/2013. This clearly shows that the learned assessing officer has not followed the dictate of the decision of the in case of GKN driveshafts Ltd. Vs ITO [ 2002 (11) TMI 7 - SUPREME COURT] . Further the assessee was not given 4 weeks time after the rejection of the objections against the reopening of the assessment to explore the alternative remedy available to the assessee which is also contrary to the decision in case of ASIAN PAINTS LIMITED. VERSUS DEPUTY COMMISSIONER OF INCOME-TAX AND ANOTHER. [ 2007 (1) TMI 159 - BOMBAY HIGH COURT] wherein it has been specifically held that if Assessing Officer does not accept the objections so filed, he shall not proceed further in the matter within a period of four weeks from the date of receipt of service of the said order on objections, on the assessee. In the present case even before the service of the order rejecting the objections of the assessee the learned assessing officer as passed the assessment order on 20/3/2013. In view of this, there is a clear-cut violation of the principles of natural justice by the AO and procedure deserves to be set right. Assessee are allowed and reassessment is quashed. - Decided in favour of assessee. 2019 (4) TMI 1423 Violation of principles of natural justice - order u/s 144 making an addition u/s 68 - jurisdiction of the assessee s case initially was with ITO, Ward-1(3) who had issued scrutiny notice thereafter, the file was transferred to ITO, Ward-9(4) - assessee filed a letter before the ITO, Ward-1(3) informing change of address with the copy to ITO, Ward-9(4) and both Commissioner of Income Tax. However, ITO, Ward-9(4) issued notice on the old address and such notice was not served - HELD THAT:- No notice was issued on the new address, though the same was on the records of the Assessing Officer. Hence these in violation of principles of natural justice. Hence, we are of the opinion that the issue should be restored to the file of the Assessing Officer for fresh adjudication in accordance with law, after giving the assessee adequate opportunity of being heard. We set aside the matter to the file of Assessing Officer for fresh adjudication in accordance with law after giving assessee adequate opportunity of being heard. The assessee is directed to follow the guidelines and specific directions given by the ld. CIT(A) in his order u/s 263 which were upheld in the case of Subhalaxmi Vanijya Pvt. Ltd. vs. CIT [ 2015 (8) TMI 174 - ITAT KOLKATA] 2019 (4) TMI 1422 Unexplained credit u/s. 68 - introduction of share application money and share premium - provisions of section 56(2) (viib) application for making addition even u/s 68 - HELD THAT:- In the given facts and circumstances of the case records, documentary evidences, arguments of both the sides clearly established that this transaction carried out by assessee receiving share application money party seems to be genuine and explained. AO has not carried out any further inquiry except the fact recorded that there is no authorized share capital to that extent and moreover, AO also noted that there is unjustifiable amount of share premium and hence, entire transactions is not genuine. We have noted that for the purpose of section 68 of the Act, three requirements are required to be fulfilled which is the genuineness of transaction, source of money i.e. creditworthiness of the party and identity of the party. According to us, the assessee has fulfilled all the three ingredients of section 68. Share premium can only be added under section 56(2)(vii)(b) which was inserted by the Finance Act, 2013 with effect from 01.04.2013 i.e. for and from the AY 2013-14. We will dealt with the case laws in the next part of this order which was cited before us by both the sides. When shares are issued at premium, number of shares and authorized capital increase lesser in comparison of capital raised by way of capital and premium. These provisions are deeming provisions as otherwise share premium and capital is a capital receipt which cannot be taxed as income. However, w.e.f A. Y. 2013-14 for closely held companies share premium or share capital is deemed to be normal income if shares are issued exceeding fair market value of shares. But, in any case the amendment will apply for and from AY 2013-14 and not to earlier Assessment Year because the amendment is prospective and not retrospective. Hence, on the issue of share premium, the provisions of section 56(2) (viib) cannot be applied for making addition even under section 68. In the present case, the overwhelming evidence proves that the nature of receipt is share premium and share application money. The audited accounts of both parties, the statutory since it was the department which claimed that the share premium is not in fact so, despite the statutory forms viz. Form 2 for return of allotment and Form 20B for annual return filed with the ROC all show the nature as share premium. If the Department wants to contend that what is apparent is not real, it is the onus of the department to prove that it was Assessee s own money which was routed through a third party. Only then can the provisions of section 68 be invoked AO makes the mention of the reserves and loss while challenging the charge of share premium on preference shares - Reserves could be relevant for valuing equity shares. They are not relevant for valuing preference shares. Preference shareholders get priority over the equity shareholders in terms of payment of dividend and during winding up. They get only a fixed rate of dividend. The redemption amount depends on the terms of issue. The conversion depends on the terms of issue. The terms of issue are relevant for valuing preference shares. Even the present Rule 11UA of the Income Tax Rules 1962 are applicable only to section 56(2) of the Act, requires valuation of preference shares by the merchant bankers. AO has not even attempted to do any sort of valuation of preference shares. His addition is based entirely on conjectures and surmises. It is settled law that the assessment cannot he made on mere suspicion, conjectures and surmises. Assessee has discharged its onus by adequately disclosing the transaction in its books of accounts, filing statutory forms as regards allotment of shares, providing name, address and PAN of the shareholders, etc. the assessee has sufficiently discharged the onus cast upon it for the purpose of section 68 and no addition can be made on this account. CIT(A) has rightly deleted the addition and we confirm the same. These two common issues of Revenue s appeal are dismissed. Addition under section 56(2)(viia) - HELD THAT:- We have gone through the findings of CIT(A) and noted that the entire reserves and surplus appearing in the balance sheet as on 1.4.2010 are only on account of the grant received from the Government of India and not on the basis of any business profit earned by the company. In these circumstances, in my view, there can be no inference that the shares of VITPL have been acquired by the assessee at a price which is less than its fair market value. Hence, we find no reason to reverse the findings of CIT(A) and accordingly, the same is upheld. Addition of interest of bank fixed deposits netting of against closing work in progress account - HELD THAT:- The CIT(A) allowed the claim of assessee by observing that the assessee company has earned this interest income from deposits placed with IDBI Bank with the object of availing credit facilities for importing BOPP loan equipment and this interest income is inextricable linked or connected to the setting up of the project of BOPP. This interest income has been derived from fixed deposits placed with bank for availing LC margin against importing plant and machinery and therefore the same is squarely covered by the decision of Hon ble Supreme Court in the cases of CIT vs. Bokaro Steel Ltd. [ 1998 (12) TMI 4 - SUPREME COURT] and CIT Vs. Karnal Co-operative Sugar Mills Ltd. [ 1999 (4) TMI 7 - SUPREME COURT] . We find that even now before us, the Revenue could not dislodge the finding of CIT(A) that the interest earned from FDR s were inextricably linked with setting up of new power plant and therefore interest earned was to be treated as capital receipt. Addition u/s 14A - addition of expenses relatable to exempt income being interest and other charges to bank capitalized in the capital work in progress - computing the book profit under section 115JB - HELD THAT:- AO computed the disallowance of Rs. 1,36,671/- under Rule 8D while computing the book profit under section 115JB of the Act and this issue is now squarely covered by the decision ITAT in the case of ACIT vs. Vireet Investments (P.) Ltd. [ 2017 (6) TMI 1124 - ITAT DELHI] . Appeal of Revenue is dismissed. 2019 (4) TMI 1421 TDS u/s 194J OR 194C - non deduction of tds - disallowance u/s 40(a)(ia) on carriage fees / channel placement fees - HELD THAT:- Issue whether carriage fees / channel placement fees paid by the assessee is in the nature of royalty or fees for technical services requiring deduction under section 194J of the Act has come up for consideration in assessee s own case [ 2016 (1) TMI 213 - ITAT MUMBAI] The Tribunal while deciding the issue in unequivocal terms has held that the payment made towards carriage fees / channel placement fees does not partake the character of either royalty or fees for technical services. Thus, the issue having been decided in favour of the assessee. 2019 (4) TMI 1420 Disallowance made u/s.14A - no show cause notice to the assessee before invoking the provisions - HELD THAT:- In view of the ratio laid down in the case of Godrej Boyce Manufacturing Company Ltd. Vs. DCIT [ 2017 (5) TMI 403 - SUPREME COURT OF INDIA] and also the clear cut provisions of the Act, i.e. section 14A(3) of the Act, there is no merit in the disallowance made by the AO without giving any show cause notice to the assessee before invoking the provisions of section 14A of the Act. The disallowance made by the Assessing Officer and confirmed by the CIT(A) is reversed. Grounds of appeal raised by the assessee are thus allowed. Deduction u/s 54B - capital gain on sale of one agricultural land - investment made in two agricultural land - AO allowed dedction in respect of one property - HELD THAT:- There was no ambiguity in the provisions of section 54B, there was no clarification needed to be given. Accordingly, I find no merit in the plea of the assessee that it could claim the aforesaid deduction in respect of two separate investments in agricultural lands, made by the assessee consequent to selling of one agricultural land. In case, the assessee had sold two pieces of land, i.e. agricultural land, then it could claim the deduction against the aforesaid investments in two separate pieces of land. However, in the present case, it is not so. Hence, I find no merit in the plea of the assessee. Ratio of decisions in SMT. SAVITA RANI. [ 2002 (5) TMI 6 - PUNJAB AND HARYANA HIGH COURT] Anil Bishnoi Vs. ACIT [ 2017 (10) TMI 868 - ITAT CHANDIGARH] are not applicable in facts of assessee. Customs 2019 (4) TMI 1444 Application of valuation rules - comparing value with import from other countries - import of branded goods from related party - undervaluation of goods - electrical decorative lights - Recovery of duties not levied or short-levied or erroneously refunded - Suppression of facts - non-declaration of brand of imported goods , intentionally - HELD THAT:- The electrical decorative lightings, normally, are not highly branded products, exceptions apart. It does appear that even though the imports were under the brand names Diyas and mAntra , they were not trademarks of such nature as would make them an exclusive product. It also appears that there has been some mix up in the understanding of a trademark protection, as the same has been compared with patented goods . Thus, data was certainly available, which could have been utilised to obtain the pricing for imports from the U.K., of identical goods or similar goods. The irony is that if the competent authority thought that these were goods where trademark was of significance, it could not simultaneously have ignored the imports under the same trademark, from different countries, where there were no related parties. Naturally, there would have to be made adjustments for the distance from which the import was made, or the size of the consignment, if applicable, as set out in Rules 3 to 5. There was really no occasion to straightaway proceed to determine the transactional value by relying on Rules 7 to 9 - there is no doubt this principle of sequential application would apply, especially in view of sub-Rule (4) of Rule 3, which provides that there has to be a sequential implementation of the Rules, i.e., that Rules 3 to 5 would have to be exhausted first, and only in the eventuality of an inability to apply the Rules would the assessing authority proceed to impose Rules 7 to 9. Thus, there appears to be a fundamental mistake committed in the manner of implementation of the statutory Rules. Once the statutory Rules exist and provide for sequential implementation, the assessing authority has no option but to proceed in accordance with those Rules, in that manner. The matter remitted back to the Principal Commissioner of Customs (Preventive), Customs, New Delhi, to proceed afresh with the matter in accordance with the observations aforesaid, and thus, it is Rules 3 to 5 which would have to be applied first, as it is provided for the Rules to apply sequentially - appeal allowed by way of remand. 2019 (4) TMI 1443 Imposition of penalty on Managing Director - mis-declaration of imported goods - HELD THAT:- The goods were imported by a unit operating under a special scheme framed to showcase best practices and while enabling industrial growth in circumstances of minimal intervention. The double lock bond regulated the deployment of imported goods in the operations of the unit and ensured that such privileged goods was utilized exclusively for the intended purpose. In the present instance, it is not anybody s case that the goods have been diverted or intended to be; on the contrary, it would appear that the claim of the appellants of lack of motive was discarded on the finding of benefits derived from transacting in foreign exchange - Notwithstanding this, the culmination of penalty under section 112 of Customs Act, 1962 commenced from confiscation of the goods as a consequence of admitted mis-declaration in which the motives are not relevant. The benefits that may have accrued to the appellants through misuse of foreign exchange transactions was brought to nought and as the misdemeanour is limited to the act of mis-declaration, the penalty on Shri Hemrajani be reduced to Rs. 5,00,000 and that on Ms Veena Mishra to Rs. 1,00,000 - appeal allowed in part. Corporate Laws 2019 (4) TMI 1450 Misappropriation under 403, 404 of IPC of all the proceedings etc. affairs of the Company are not being conducted by its Directors and officers and they are liable for action as per investigation report in question for various violations Civil and Criminal under Sections 159, 166, 210, 220, 266(c) r/w Section 628, 240(3) - HELD THAT:- The detailed report submitted by the SFIO clearly established that there are serious violations and crimes committed by the Company and its Directors. Therefore, the Government of India has rightly ordered investigation into the Affairs of Company. The evidence placed by the Union of India in support of the instant Case is fully justified. Moreover, the contention of the Petitioner that the other criminal cases are pending and obtained stay of those proceedings and they have also filed several cases seeking to compound the offences mentioned in the report have hardly any bearing on the instant case. In the instant Case, admittedly, the Company and its Directors have violated several sections of the Companies Act, 1956. Apart from Criminal offences, so far as the instant case is concerned the Tribunal is having jurisdiction to take cognizance of the issue and pass suitable orders on the issue. And the petition is filed in accordance with law and the contentions/allegations made contrary in this regard by the Respondents are not tenable and baseless. The Contention of the Respondents that if Directors are replaced by the Union of India, it would prejudicially affect the cases filed against them is not tenable. Evidence to be adduced in Criminal is different from evidence to be adduced in Civil Case. The criminal case has to be defended by an Individual person in his personal capacity and the Company being a Separate legal entity is bound by its Memorandum and Articles of Association. When the Respondents are facing misappropriation for huge of amount of money which are substantiated, it is necessary to replace the existing the management of R-1 Company with independent Directors to be appointed by Union of India. After considering the contentions made the Principal Bench, CLB , New Delhi , dismissed it by an order dated 10th August, 2015 by inter alia holding that the matter was investigated by Serious Fraud Investigation Office. Investigation report was submitted in September, 2009. Investigation under 239 was ordered in April, 2009 and report by SFIO was submitted on 30.07.2011. The instant petition was first filed on 30.01.2013 and refiled on 09.07.2014 with an application seeking condonation of delay in refilling. Therefore, the Tribunal held the case was filed well within time and it does not suffer from undue delay and latches. Therefore, the above order became final and thus it is not necessary to advert it again with regard to laches and limitation as raised by the Respondents. Subsequently, the case was transferred to this Bench by the Principal Bench by order dated 26.10.2017 with a direction to the parties to appear Bengaluru Bench of NCLT on 18.12.2017. Accordingly, the case is taken on record of this Bench and posted it on various dates and it is adjourned on those dates on various grounds as mentioned in docket orders of the Tribunal. So far as contention of the Respondents that there is no analogous provisions contained in New Companies Act, 2013 with regard to Section 388-B and other related sections of 1956 is concerned, it is to be mentioned here that there is exclusive Chapter XIV (Inspection, Inquiry and conduct inquiries) covering Sections 206-229 of Companies Act, 2013. In any case, the instant case is filed under the provisions of Companies Act, 1956 and the same is maintainable and it is filed in accordance with law. Therefore, we are of the considered opinion that the Petitioner make out a case so as to interfere in the Affairs of the Company with suitable orders so to protect the property of the Company; to protect the interest of stakeholders of Company and to see the Company follow statutory compliances etc. We are also of considered opinion that the existing management should not be continued, and it should be replaced by the New Directors to be appointed by the Union of India as per law. Service Tax 2019 (4) TMI 1419 Valuation of photography services - exemption Notification No. 12/2003 - inclusion of cost of material, goods used/consumed in assessable value - period of dispute in the present case is from April, 2003 to September, 2003 - HELD THAT:-The issue is no more res-integra in view of the decision of the Larger Bench of the Tribunal in the case of AGGARWAL COLOUR ADVANCE PHOTO SYSTEM VERSUS COMMISSIONER OF CENTRAL EXCISE, BHOPAL [ 2011 (8) TMI 291 - CESTAT, NEW DELHI (LB)] where it was held that For the purpose of Section 67 of the Finance Act, 1994, the value of service in relation to photography would be the gross amount charged including cost of goods and material used and consumed in the course of rendering such service. The cost of unexposed film etc. would stand excluded in terms of Explanation to Section 67 if sold to the client. It was also held in the case that the value of other goods and material, it sold separately would be excluded under exemption Notification No. 12/2003 and the term sold appearing thereunder has to be interpreted using the definition of sale in the Central Excise Act, 1944 and not as per the meaning of deemed sale under Article 366(29A)(b) of the Constitution. Appeal allowed - decided in favor of appellant. 2019 (4) TMI 1418 Classification of service - Cargo Handling Service or otherwise? - activity of transportation of the minerals from the mine s pithead to the railway siding (part of the mine) and loading the same into railway wagons - HELD THAT:- To call an activity to be cargo handling service there should be an activity of movement of cargo from one place to another place without any internal movement within the mining area. Neither handling service outside the mining area is evident from the adjudication order nor destination outside such area has come to record. Therefore, when the factual evidence demonstrates movement of the excavated minerals within the mining area from one place to another, that operation cannot be called as cargo handling service. The agreement itself provides for detailed break-up of rates for each of the four activities to be undertaken by the appellant. A plain reading of these rate schedules will show that the essence of the contract is for transportation of mineral within the mining area. The Board vide circular dated 29-2-2008 clarified the application of Section 65A while classifying a composite service - The definition of cargo handling service under the Finance Act, 1994, does not include the kind of activities undertaken by the appellants and hence the same are not chargeable to service tax. Thus, the demand of Rs. 80,62,565/- in respect of cargo handling service in the first appeal is set aside. Demand of Rs. 20,96,816/- on site formation services - HELD THAT:- The activity of making of 100 meters dia holes with contractors own equipment is not one relating to site formation - definition of Site formation and clearance, excavation and earthmoving and demolition as defined under Section 65(97 a) of Finance Act, 1994 as amended covers Drilling, boring and core extraction services for construction, geophysical, geological or similar purposes; but in the instant case, the appellants activity is limited to supply of the machine and men. The entire job is undertaken by TISCO people and there is no liability on the part of the appellant - the appeal on this count also succeeds. Penalty - HELD THAT:- There was no suppression or mis-statement by the appellants regarding the nature of activities undertaken by the appellants and hence the imposition of penalty on them is not at all justified - appeal allowed. Appeal disposed off. 2019 (4) TMI 1417 Classification of services - Cargo Handling services or otherwise? - handling of iron and steel products at the later stockyard - HELD THAT:- The appellant shall take delivery of all the consignments meant for the Company and stacked them in the stockyard in orderly manner and arrange for the delivery of the goods. The agreement outlined four measure operations viz. unloading, transportation (both external and internal) stacking and ExYard delivery - On examination of the agreement, it is observed that the appellant for the purpose of transportation from the platform to the stockyard of the appellant has undertaken the job of loading and unloading operation. Transportation is the main activity for which loading and un-loading are performed. Transportation of the goods would incidentally include loading and unloading, but these activities cannot be covered by the definition of Cargo Handling Services. Board s Circular dated 01.08.2002, clarifies that mere transportation of goods is excluded from the purview of cargo handling services. In the instant case, the payment was made for the performance of cranes, machinery and trucks for undertaking transportation of the goods by the above machinery and trucks, wherein loading and unloading is incidental activity. The payment received by the appellant is not under head of Cargo Handling Services , but for Hire charges on such machineries. It is pertinent to note that the agreement was executed on 8th December, 2000, and the cargo handling service has been notified w.e.f. 16.08.2002. The activity undertaken by the appellant is of transportation of goods and the activities of loading and un-loading are clearly incidental to the main activity of transportation of goods - Appeal allowed - decided in favor of appellant. 2019 (4) TMI 1416 Classification of services - Intellectual Property Services or otherwise - manufacture and supply of machinery and equipment under License Agreements with two foreign companies located outside India - HELD THAT:- The issue is no more res-entigra in view of the circular issued by CBEC and DGST dated 21/12/2007. Section 66A of the Finance Act, 1994, inserted with effect from 18-04-2006, provides that where any taxable service is provided or to be provided by a person who has established a business or has a fixed establishment from which the service is provided or to be provided or has his permanent address or usual place of residence, in a country other than India, and is received by a person who has his place of business, fixed establishment, permanent address or usual place of residence, in India, such service shall be taxable service. The impugned order is modified to the extent that the demand of Service Tax w.e.f. 19/04/2006 is sustained. The demand for the earlier period is set aside and the penalties imposed under Section 76, 78 77 are set aside - appeal allowed in part. Central Excise 2019 (4) TMI 1415 CENVAT Credit - exempt goods or not - iron ore fines, generated during the process of manufacture of Sponge Iron and cleared by the appellant - Rule 6 of Cenvat Credit Rules, 2004 - HELD THAT:- The issue in the present appeal is covered by the decision of this Tribunal in M/S. JSW STEELS LTD VERSUS COMMISSIONER OF CENTRAL TAX AND CENTRAL EXCISE, BELGAUM [ 2019 (3) TMI 29 - CESTAT BANGALORE] , where it was held that even after the amendment from 01.03.2015, Rule 6 shall not applicable to by-products/waste products produced during the manufacture of dutiable final products. Also, iron ore fines is not a manufactured product, Rule 6 of CCR is not applicable - appeal allowed - decided in favor of appellant. 2019 (4) TMI 1414 Utilization of CENVAT Credit - case of Revenue is that cenvat credit availed by them has been utilized by them towards payment of Central Excise Duty on Pre-stressed Sleepers which has no nexus with the manufacturing activity - HELD THAT:- The cross utilization of credit on input and input services and capital goods is permitted by law - the assessee has rightly taken the cenvat credit and utilized a part of the same as there is no bar in cross utilization. Appeal dismissed - decided against Revenue. 2019 (4) TMI 1413 CENVAT Credit - Process amounting to manufacture - conversation of iron ore into iron ore concentrate - HELD THAT:- It has not been disputed by the Department that the duty has been paid by the manufacturer of the goods in pursuance of the judicial pronouncement vide the order of the Ld. Adjudicating Authority and upheld by the Commissioner(Appeal). In the circumstances, there is no infirmity committed by the appellant within the provisions of the Cenvat Credit Rules, 2002-04 by availing such credit. Rule 3(1) of the Cenvat Credit Rules 2002-04, specifically provides that a manufacture/procedure of the final good is entitled to take cenvat credit of excise duty paid on any input/capital goods received in the factory for manufacture of final product. Rule 3(4) of the Cenvat Credit Rule also allow the appellant to utilise the said credit for the payment of Central Excise Duty in respect of dutiable final product manufactured and cleared by the appellant during the impugned period. Hence, there is no irregularity committed by the appellant in the instant case by availing of the Cenvat Credit and also the appellant has availed and utilised the Cenvat Credit as per the law. Appeal allowed - decided in favor of appellant. 2019 (4) TMI 1412 Valuation - inclusion of packing and forwarding charges in assessable value - HELD THAT:- The issue is no more res-entigra in view of the decision of the Hon ble Supreme Court in the case of UNION OF INDIA ORS. ETC., ETC. VERSUS BOMBAY TYRE INTERNATIONAL LTD. ETC., ETC. [ 1983 (10) TMI 51 - SUPREME COURT OF INDIA] is applicable to the period prior the introduction of transaction value with effect from 1/7/2000 and for the period after 1/07/2000 the issue is covered by the decision of the Larger Bench of COMMISSIONER OF CENTRAL EXCISE, INDORE VERSUS M/S GRASIM INDUSTRIES LTD. THROUGH ITS SECRETARY [ 2018 (5) TMI 915 - SUPREME COURT] . The goods are otherwise marketable without packing and the same is done only at the request of the customers. The activity being a post manufacturing activity, the value of such packing material is not includible in the assessable value. Appeal allowed - decided in favor of appellant. 2019 (4) TMI 1411 Classification of goods - C.I. Castings - benefit of N/N. 208/83-C.E. dated 1.08.1983, No. 90/88-C.E. dated 1.3.1988, No. 202/88-C.E. dated 20.5.1988 and No. 275/88-C.E. dated 4.11.1988 - whether classifiable under Chapter heading No. 73.07 upto 28.2.1988 and heading No. 73.25 with effect from 1.03.1988 or otherwise? HELD THAT:- It is trite law that, if the Department intends to classify the goods under a particular heading or sub-heading, the Department has to adduce proper evidence and discharge the burden of proof - In the present case, the Department has not produced any evidence that Castings manufactured by the Appellant have undergone any process beyond proof-machining. There seems to have been no misdeclaration or suppression of facts or contravention of any of the provisions of law with intent to evade payment of duty on the part of the appellant. Validity of subsequent SCNs - HELD THAT:- The Excise Department considered the issue relating to the chargeability of the duty on the products manufactured by the Appellant on various occasions in the past i.e. when the Appellant surrendered the L-4 license on 26.12.1986 and also when the Appellant filed declarations on 16.4.1990. The issue of chargeability of the duty on the products manufactured by the Appellant was also examined by the Assistant Director, DGAE, Patna. The department also issued letters/Show Cause Notices (s) on the same subject matter - It is well settled by various decisions of the Hon ble Supreme Court that when the department has earlier considered the issue, or has issued show cause notice on the same matter earlier, it cannot issue a subsequent show cause notice alleging suppression of facts. Appeal allowed - decided in favor of appellant. 2019 (4) TMI 1410 Clandestine removal - Sponge iron - demand based on the documents called weighment slips recovered from the residential premises of third party - opportunity for cross-examination denied - principles of natural justice - HELD THAT:- The learned Commissioner has proceeded to confirm the demand on the basis of documents seized from third party, etc. The appellant has successfully rebutted these evidences relied upon by the Commissioner - no investigation has been undertaken by the Revenue towards procurement of additional raw materials clandestinely. No other corroborative documents have been produced. Investigations against the consignees have also not been done before raising demand on the allegation of clandestine clearance. The onus is definitely on the Department to establish manufacture and clearance of such goods and also the receipt of payments. Demand of duty do not sustain - penalties also cannot sustain - appeal allowed - decided in favor of appellant. 2019 (4) TMI 1409 Monetary amount involved in the appeal - HELD THAT:- The present case falls under exclusion clause 3 (C) of the National Litigation Policy introduced vide Board s Instruction dated 17.12.2017 which has been deleted vide Instruction F. No. 390/Misc./116/2017-JC dated 04.04.2018. The appeal is dismissed under National Litigation Policy. 2019 (4) TMI 1408 Clandestine removal - Methanol - Formaldehyde - it was alleged that the assessee has failed to account the entire quantity of final product manufactured - HELD THAT:- The allegation of clandestine clearance has to be supported by tangible evidence of clearance of the alleged additional quantity. Such allegation cannot be made simply on the basis of arithmetical projection based on a mathematical formula. This view finds support in the case of RA CASTINGS PVT. LTD. VERSUS COMMISSIONER OF C. EX., MEERUT-I [ 2008 (6) TMI 197 - CESTAT NEW DELHI] - The total quantum of steel ingots manufactured by the assessee was projected on the basis of a Technical Report of study carried out by a Prefessor of IIT, Kanpur, but the CESTAT while examining the appeal against such demand, observed that the allegation of clandestine clearance cannot be sustained only on the basis of such Technical Report. The demand for duty as well as proposal for recovery of cenvat credit cannot be sustained and the impugned orders upholding such view are set aside - appeal allowed - decided in favor of appellant. 2019 (4) TMI 1407 Valuation - clearances of goods manufactured in BSNL Telecom Factories and cleared to various BSNL Telecom Circles - Department was of the view that valuation was required to be adopted with reference to Challaning Rate but on the basis of value of materials within the current year when the goods were cleared - period 2003-04 to 2006-07 - HELD THAT:- Since no sale involved, this dispute has been decided by the Tribunal in the case of BSNL s earlier case BSNL VERSUS COMMISSIONER OF C. EX., HALDIA [ 2007 (2) TMI 97 - CESTAT, KOLKATA] in the year 2007. CESTAT, in that case, has taken the view that there is no requirement to add notional profit of 10%/15% and that the valuation may be decided under Rule 11 by adopting Challaning Rate - Keeping such decision of the Tribunal in view, it appears that the valuations during the disputed period in this case, are also to be done on the basis of Challaning Rate. It is prayed that payment in excess may be allowed to be adjusted towards short payment in many other cases. We also find that such request is also fair and equitable - matter remanded to the adjudicating authority for the purpose of re-calculation of the demand after allowing adjustment towards the excise duty excess paid. If any differential duty is to be paid by BSNL, the same may be recovered from BSNL - penalty set aside. Appeal allowed by way of remand. 2019 (4) TMI 1406 Valuation - inclusion of processing charges paid to WBIDC for capital subsidy and power incentive in assessable value - penalty - HELD THAT:- It is not in dispute that without power incentive and capital subsidy, the project would not have been viable. Hence, the subsidy has got direct nexus with the manufacturing activity - In order to procure the capital goods, subsidy was allowed by State Government. Power incentives/subsidy has direct nexus with the manufacturing activities. Penalty - HELD THAT:- There is no element of suppression of facts or willful mis-statement etc. with intent to evade payment of service tax - Penalty set aside - appeal allowed - decided in favor of appellant. 2019 (4) TMI 1405 Valuation - re-fixation of capacity of production on the basis of only one batch type furnace which was functional through the impugned period - HELD THAT:- The Annual Capacity Determination has not been so as per Annual Capacity Determination Rules and also submissions made by the appellant and inspite of two remand orders by this Hon ble Tribunal, the Revenue is not interested in deciding the case as per remand direction which is impermissible due to having their binding nature - appeal allowed - decided in favor of appellant. CST, VAT & Sales Tax 2019 (4) TMI 1404 Whether the Commissioner, Commercial Tax recorded prior reasons as contemplated under Sub-section (1) of Section 55 and whether there was proper delegation to the Subordinate Authorities to carry out the search operation? - HELD THAT:- Close reading of Section 55(1) of the Act of 2002 reveals that, it does not confer unbridled and unguided power on the Commissioner to order for investigation. Self satisfaction on the fact available has to be arrived at first which is required to be recorded in writing . In other words, action cannot be taken simply or being satisfied without recording the reasons of satisfaction. The respondents thus have adverted to second part of Subsection (1) of Section 55 of Act of 2002 which empowers the Commissioner to direct any of the Officers referred to in Clauses (c) to (h) of Sub-section (1) of Section 3 to proceed to investigate - The contention that no reason to inspect/search business premises is required to be given , indicates that the Commissioner did not record any reason to believe the correctness of the information of tax, evasion received by him to form basis for investigation. This fact is further established when despite the order dated 04/08/2016, the respondent has failed to keep the original file present at the time of hearing for perusal of this Court to ensure whether any reason has been recorded by the Commissioner before issuing directions under Section 55(1) of the Act of 2002. The provisions as adverted supra being mandatory, non compliance thereof, vitiated the entire proceedings. Thus when the foundation is found to be defective, the entire superstructure must crumble. The investigation, assessment thereof, the First and Second Appellate order are quashed - Appeal allowed - decided in favor of appellant. Indian Laws 2019 (4) TMI 1403 Compassionate appointment - HELD THAT:- The essence of the claim lies in the immediacy of the need. If the facts of the present case are seen, it is evident that even the first recourse to the Central Administrative Tribunal was in 2007, nearly eleven years after the death of the employee. In the meantime, the first set of representations had been rejected on 3 January 1997. The Tribunal, unfortunately, passed a succession of orders calling upon the appellants to consider and then re-consider the representations for compassionate appointment. The recourse to the Tribunal suffered from a delay of over a decade in the first instance. This staleness of the claim took away the very basis of providing companssionate appointment. The claim was liable to be rejected on that ground and ought to have been so rejected. The judgment of the High Court is unsustainable. Appeal allowed.
← Older Newer →

Quick Updates:

What's New:
Latest Case Laws

What's New:
Latest Notifications

What's New:
Latest Circulars

F: GST Compliance Challenges When Reselling Soil Without Proper Invoices ...

F: GST Amnesty Scheme: Mapping Excess Tax Payments in DRC-03 Form with DR...

F: Temporary Export for Repair and Software Upgrade to Related Party Not ...

F: Input Tax Credit Available for Technical Advisory Services on Foreign ...

F: How to Claim GST Pre-Deposit Refund After Favorable Appeal When Portal...

F: Restaurants eligible for composition scheme when delivering through Sw...

F: Businesses with Multiple Locations Under One GST Number Can Use Single...

H: Customs Duty Rates Under India-UAE CEPA to Change from April 2025 Thro...

H: Karnataka Urban Water Supply Drainage Board receives tax exemption und...

H: Income-tax Rules Amended: Form 3CD Gets Major Overhaul with New Report...

H: Government Amends India-Mauritius CECPA Tariff Structure with New Duty...

H: SEBI Amends REIT Regulations: Relaxed Lock-in Rules for Sponsors and N...

A: India's Global Impact: Economic Power, Diplomatic Ties, and Strategic ...

A: Supreme Court Rules Unlisted Claims in Resolution Plans Extinguished, ...

A: LLPs Must File Form 8 by October 30, Form 11 by May 30 to Avoid Penalt...

A: Fake Invoices in GST: Understanding Illegality, Economic Impact, and L...

A: Guide to Recycling Metal Cans, Perfume Bottles, and Packaging Material...

A: Trade Wars Escalate: Tariffs Disrupt Global Supply Chains, Raise Price...

A: Hedge Funds: High Returns, High Risk, Complex Strategies. Evolving wit...

A: CAPEXIL: Boosting India's Chemical Exports Since 1958 with RODTEP MAI ...

A: AEPC Boosts Indian Apparel Exports with Market Research, Trade Fairs, ...

A: Investor Education and Protection Fund Authority Rules 2018: Ensuring ...

A: Understanding Inverted Duty Structure: When Input GST Exceeds Output G...

A: Navigating Valuation Rules for Importing Services: GST, Customs, and I...

H: GST Assessment Order Set Aside for Lacking Document Identification Num...

H: Refund of Unutilised Input Credit Allowed After Shipping Bills Properl...

H: Penalty Under Section 271C Deleted For Bona Fide Short TDS Deduction O...

H: Additions Under Section 68 Invalid When Based on Undisclosed Investiga...

H: Reassessment Order Set Aside: AO's Failure to Follow Procedure and Com...

H: Tribunal Excludes Three IT Giants as Comparables for Transfer Pricing ...

↑Top

Newsletter: Where Service Meets Reader Approval.

TMI Tax Updates - e-Newsletter April 26, 2019

Articles

1. GST ON POLYPROPYLENE LENO BAGS

2. MARGIN SCHEME UNDER GST

Notifications

1. F. No. 1/13/2013 CL-V, part-I, Vol.ll - dated 25-4-2019 - Co. Law

2. F. No. 01/16/2013 CL-V (Pt-l) - dated 25-4-2019 - Co. Law

3. 03/2015-2020 - dated 24-4-2019 - FTP

4. Order No. 05/2019 - dated 24-4-2019 - Gujarat SGST

5. 22/2019-State Tax - dated 24-4-2019 - Gujarat SGST

6. 21/2019-State Tax - dated 24-4-2019 - Gujarat SGST

7. 20/2019-State Tax - dated 24-4-2019 - Gujarat SGST

8. Order No. 05/2019-State Tax - dated 23-4-2019 - West Bengal SGST

9. 683-F.T. - dated 23-4-2019 - West Bengal SGST

10. 682-F.T. - dated 23-4-2019 - West Bengal SGST

11. 681-F.T. - 22/2019-State Tax - dated 23-4-2019 - West Bengal SGST

12. 680-F.T. - 21/2019-State Tax - dated 23-4-2019 - West Bengal SGST

13. 679-F.T. - 20/2019-State Tax - dated 23-4-2019 - West Bengal SGST

14. 19/2019 – State Tax - dated 22-4-2019 - West Bengal SGST

Circulars / Instructions / Orders

1. 97/16/2019-GST - dated 8-4-2019

2. 95/14/2019-GST - dated 28-3-2019

3. 96/15/2019-GST - dated 28-3-2019

4. 94/13/2019-GST - dated 28-3-2019

5. 93/12/2019-GST - dated 11-3-2019

6. 92/11/2019-GST - dated 8-3-2019

7. 90/09/2019-GST - dated 18-2-2019

8. 91/10/2019-GST - dated 18-2-2019

9. 33 - dated 25-4-2019

Highlights / Catch Notes

GST

Hostel Accommodation Under Rs. 1000 Per Day Exempt from GST: No Tax on Lump Sum Payments.

Mining Company Contributions to DMF and NMET Classified as Royalty, Subject to GST Under Reverse Charge Mechanism.

Goods Detained Due to Missing E-Way Bill Part-B; Petitioner Challenges GST Act Applicability, Awaits Further Review.

GST Rates for Fluoride Control Project: NIL if Goods <25% of Total Supply, 12% if >25.

GST Rate for Nuclear Fuel Complex Supply Set at 18% for Commercial Use; 12% Rate Not Applicable.

Income Tax

Interest on Car Loan for Business Use Cannot Be Disallowed Due to Other Fund Allocations by Taxpayer.

Unexplained Share Premiums Taxable Under Income Tax Act Section 68, Amended by Finance Act 2013.

CIT(A) Must Reassess Income u/ss 144, 68, and 56(2)(viia) After Initial Order Set Aside for Review.

Wharfage Charges Not Rent: No TDS u/s 194I, Deductible u/s 37(1) for Loading/Unloading Goods.

Company's Income from Projects in India Classified as Business Profit, Not Royalty, Due to Permanent Establishment.

Stay Granted on Tax Demand Pending Reversal of CIT(A) Order Favoring Another Taxpayer.

Section 260A: Appeals in Tax Cases Only on Significant Legal Issues, Not Factual Disputes for Judicial Focus.

Tax Case: 50% Depreciation Disallowed u/s 32(1)(iia) for Assets Used Less Than 180 Days.

Section 54B Deduction Denied for Investing in Two Lands After Selling One; Only Single Land Investment Qualifies.

Eligibility for Deductions u/s 80IC: Enhanced Profits from Disallowances Increase Eligible Business Profits for Tax Deductions.

Customs

Managing Director Penalized u/s 112 of Customs Act for Mis-declaration; Motives Considered Irrelevant.

Assessing Authority Must Follow Statutory Valuation Rules for Import Values Without Deviation.

Service Tax

Service Tax Not Applicable: Mineral Transport from Mine to Railway Exempt from Cargo Handling Classification.

Central Excise

Excise Valuation Excludes Packing Charges if Goods are Marketable Without Packing; Post-Manufacturing Process Clarified.

CENVAT Credit Used for Central Excise Duty on Pre-stressed Sleepers, Revenue Challenges Lack of Manufacturing Connection.

CENVAT Credit Reversal Not Required for By-Products or Waste in Manufacturing Dutiable Goods Post-Rule 6 Amendment.

Case Laws:

GST

Income Tax

Customs

Corporate Laws

Service Tax

Central Excise

CST, VAT & Sales Tax

Indian Laws

Quick Updates:

TMI Tax Updates - e-Newsletter
April 26, 2019