Tax Law : Important Judgments By Supreme Court In 2024

As the year 2024 nears its end, LiveLaw brings to you a summary of important Supreme Court judgments of the year rendered in connection with Tax Law. The same are as follows:1. Hiring Of Motor Vehicle Or Cranes Is Not 'Sale Of Goods' If Control Over Equipment Is Retained By Contractor, VAT Can't Be Levied: Supreme CourtCase: M/s. K.P. Mozika v Oil and Natural Gas Corporation Ltd. & Ors. [2024 LiveLaw (SC) 26]In this case, a bench of Justice Abhay S Oka and Justice Rajesh Bindal held that...

Application For Revocation Of Cancellation Of GST Registration Rejected Just Because Taxpayer Did Not Respond To SCN: Delhi HC Revives Application

The Delhi High Court held that the application for revocation of cancellation of GST registration could not have been dismissed, when apart from using the phrase “any supporting documents” and “others”, no further reason was assigned as to why the said application was dismissed.The High Court held so, while observing that the solitary reason which has weighed upon the respondent to reject that application was a failure on the part of petitioner to respond to a SCN. While rendering the order of...

GST To Remain @5% On Popcorn Sold In Theatres, Clarifies Govt

The Finance Ministry in its 55th Meeting of the GST Council, clarified that ready to eat popcorn which is mixed with salt and spices are classifiable under HS 2106 90 99 and attracts 5% GST if supplied as other than pre-packaged and labelled and 12% GST if supplied as pre-packaged and labelled.However, when popcorn is mixed with sugar thereby changing its character to sugar confectionary (e.g. caramel popcorn), it would be classifiable under HS 1704 90 90 and attract 18% GST. By this...

GST Department's Effective Adjudication Of Matter Cannot Be Scuttled By Seeking Writ Remedy: Calcutta High Court

While reiterating that it shall not interfere in matters requiring fact-finding and adjudication, which fall squarely within the statutory domain, the Calcutta High Court advised the manufacturer/ supplier to exhaust the statutory remedies provided under the CGST Act, 2017 including submitting a detailed response to the SCN.“The statutory framework under the CGST Act provides adequate mechanisms for addressing the petitioner's concerns, including responding to the SCN, participating in...

Outstanding Demand Under Maharashtra Settlement Can't Be Adjusted Against Refund Payable Under Maharashtra VAT Act: High Court

The Bombay High Court held that authorities under MVAT Act while exercising powers under Maharashtra Settlement of Arrears of Taxes, Interest, Penalties or Late Fees Act, 2022, cannot invoke provisions of Section 50 of MVAT and that too in review proceedings under Settlement Act.The Division Bench of Justice M. S. Sonak and Justice Jitendra Jain observed that there is no provision under Settlement Act which provides for calculation of outstanding arrears of a particular year to be arrived at...

DVAT Act | Assessee 'Automatically' Becomes Entitled To Interest U/S 42 On State's Failure To Adhere To Mandatory Timelines For Refund: Delhi HC

The Delhi High Court has made it clear that when a refund of tax or penalty paid in excess under the Delhi Value Added Tax Act, 2004 is delayed by the authorities, the assessee “automatically” becomes entitled to interest on such refund.Section 38(1) “obligates” the Commissioner to refund the amount of tax, penalty or interest, if paid by a person in excess of the amount due from him.Section 38(3)(a) provides the timeline for a refund from the date on which the return is furnished or the claim...

Failed To Comply With S.23(4) Of MVAT Act Along With Non-Application Of Mind & Legal Malafide: Bombay HC Quashes Assessment, Imposes 50K Cost On Dept

While considering a case where the Commercial tax department has flagrantly breached the statutory provisions of Sec 23(4) of the MVAT Act, the Bombay High Court ruled that assessment order passed by Commissioner of Sales tax is vitiated by total non-application of mind. Since a strong prima facie case is made out about manipulating the date of passing the assessment order, the High Court found that such manipulation was to create an impression that the order was made within the...

Notice of Assessment Issued Within Limitation, Assessment Order Valid Even If Passed Beyond Three-Year Period: Madras High Court

The Madras High Court stated that if notice for completing assessment issued within limitation, then assessment order is within time even if passed beyond period of three years. The Division Bench of Justices R. Suresh Kumar and C. Saravanan observed that “as per Section 24(5), no assessment shall be made after a period of three years from the end of the year to which the return under the Act relates. The test to be applied is whether the notice for completing the assessment was ...

NCLAT: Section 37 Of The MVAT Act And Section 33 Of The MPVAT Act Not Pari Materia With Section 48 Of The GVAT Act

The National Company Law Appellate Tribunal, New Delhi bench, comprising Justice Rakesh Kumar Jain (Judicial Member), Mr. Naresh Salecha (Technical Member), and Mr. Indevar Pandey (Technical Member) has held that Section 37 of the Maharashtra Value Added Tax Act, 2002 (“MVAT Act") and Section 33 of the Madhya Pradesh Value Added Tax Act, 2002 (“MPVAT Act”) are not pari materia with Section 48 of the Gujarat Value Added Tax Act, 2003 (“GVAT Act”). The Tribunal held that the claim of the...

“Assessee Entitled To Hearing If Pre-Deposit Is Made”: Gauhati High Court Grants Fresh Hearing

The Gauhati High Court while granting a fresh hearing to the assessee stated that the benefit of hearing has to be given to the assessee as the statutory deposit has already been made by the assessee. The Bench of Justice Arun Dev Choudhury observed that “This court though cannot find fault with the appellate authority in non-entertaining the appeal due to non-compliance of Section 79(5), however this court in exercise of its power under Article 226 of the Constitution of India, in the...

Presumption Of Undervaluation Can't Be Drawn Just Because Of Higher MRP Rate On Product: Punjab & Haryana HC

The Punjab and Hayana High Court stated that the presumption cannot be drawn that invoices are undervalued merely because MRP Rate mentioned on the product is higher. The Bench consists of Justices Sanjeev Prakash Sharma and Sanjay Vashisth observed that “it is also not a case of the State authorities that the invoices were different for the assessee in comparison to other distributors. Once there is no finding in this regard, a presumption cannot be drawn that the invoices were...

Boro Plus Ayurvedic Cream Is Medicated Ointment, Taxable At 5% Under Entry 41 Schedule II UPVAT Act: Allahabad High Court

The Allahabad High Court has upheld the Commercial Tax Tribunal, Lucknow's finding that Boro Plus Ayurvedic Cream is a 'medicated ointment' and not an 'antiseptic cream'. It was held that Boro Plus Ayurvedic Cream is taxable at 5% under Entry 41 Schedule II of the Uttar Pradesh Value Added Tax Act, 2008. Heading “Drugs and Medicines” in Entry 41, with effective from October 11, 2012, excludes medicated soap, shampoo, antiseptic cream, face cream, massage cream, eye jel and hair oil but...