[S.74 GST Act] Adjudicating Authority Must Record Prima Facie Satisfaction Regarding Assessee Wrongfully Obtaining Input Tax Credit: Allahabad HC

The Allahabad High Court has held that for initiating proceedings under Section 74 of the Goods and Service Tax Act, 2017, it is necessary for the adjudicating authority to record prima facie satisfaction regarding the assessee having wrongfully availed input tax credit (ITC) by fraud, willful misstatement or suppression of facts. The Court held that once the proceedings under Section 73 have been closed regarding wrongful availment of ITC, proceedings for the same cannot be initiated...

Reassessment Proceedings Can't Be Initiated Against Deceased Assessee: Kerala High Court Directs Fresh Proceedings Against Legal Heir

Kerala High Court ruled that reassessment proceedings cannot be initiated against a deceased taxpayer (assessee). The Bench of Justice Gopinath P. observed that “the procedure contemplated by Section 148A of the Income Tax Act, 1961 contemplates the issuance of a show cause notice etc., before reassessment proceedings are commenced. This cannot be a mere formality.” Section 148 of the Income Tax Act, 1961 addresses the notice that the income tax department may send regarding any...

Deferred Payment Of Works Contract In 'Recovery Mode' Doesn't Exempt Dealer From Levy Under Commercial Tax Act And Entry Tax Act: Madhya Pradesh HC

The Madhya Pradesh High Court has held that merely because payment is deferred by the State in terms of the works contract, the same cannot be grounds for a dealer to seek exemption from payment of taxes under the MP Commercial Tax Act, 1994 and MP Entry Tax Act, 1976. In the case at hand, the Petitioner-company had entered into Build, Operate and Transfer (BOT) contract with the government for development of a by-pass road. As per the agreement, no explicit consideration was to be...

S.81 CGST Act Can't Be Invoked To Declare Transfer Of Property Void Without Determining 'Nature Of Transaction' As Being Sham: Andhra Pradesh HC

The Andhra Pradesh High Court has prima facie held that Section 81 of the Central Goods and Services Tax Act, 2017 cannot be invoked to declare transfer of property void, unless there is a specific finding regarding sham nature of transaction.Section 81 provides that where a person parts with his/her property after any amount has become due from him under the Act, with the intention of defrauding the Government revenue, such transfer shall be void.In the case at hand, Petitioner was purchaser of...

Customs Can't Claim Priority Over Bank For Recovery Of Dues From Assessee's Property: Madhya Pradesh High Court

The Madhya Pradesh High Court has dismissed a petition moved by the Customs and Central Excise Department seeking priority over other secured creditors, for recovery of dues from an assessee's property. Justices Vivek Rusia and Binod Kumar Dwivedi relied on Punjab National Bank V/s Union of India and others (2022) where the Top Court had held that SARFAESI Act will have an overriding effect on the provisions of the Central Excise Act and therefore, dues of the secured creditor will...

“Only Three Days Were Given To Assessee To Respond To Show Cause Notice”: Kerala High Court Sets Aside Reassessment Order

The Kerala High Court set aside an order in reassessment proceedings that was issued without providing the assessee an opportunity to respond to the show cause notice. The Bench of Justice Gopinath P. observed that “the show cause notice was issued on 12-03-2024, giving only three days' time to the assessee to respond, and the order was issued on 20-03-2024……… one final opportunity can be given to the assessee to respond to the show cause notice”. The assessee/petitioner claims...

S.129 CGST/SGST Act | Penalty Only For Violations With Intent To Evade Tax Or Repeated Violations; Not For Minor Discrepancies : Kerala High Court

The Kerala High Court held that tax/ penalty under Section 129(1)(a) or 129(1)(b) of the CGST/ SCGST can be imposed only for violations which may lead to evasion of tax or which was done with the intention to evade or in case of repeated violations.Justice P. Gopinath observed:“It is declared that the provision of Section 129 of the CGST/ SGST Acts do not authorize the imposition of tax/ penalty as contemplated by the provisions of Section 129(1)(a) or Section 129(1)(b) in cases where only minor...

Income Tax Assessee Who Failed To Avail Option To Request Personal Hearing Can't Claim That Personal Hearing Was Not Provided: Madras HC

The Madras High Court ruled that if an assessee does not take advantage of the opportunity to request a personal hearing from the department, they cannot later claim that they were denied a personal hearing. The Bench of Justice Krishnan Ramasamy observed that “……though the department has given liberty to the assessee to request for personal hearing, the assessee failed to avail such an option. Therefore, the question of violation of natural justice will not arise.” Section 148A(b)...

Arbitral Tribunal Acted With Patent Illegality, Against Indian Law In Awarding Reimbursement Of Service Tax Along With Interest: Calcutta High Court

The Calcutta High Court Bench of Justice Sabyasachi Bhattacharyya observed that award passed by Arbitral Tribunal was tainted with patent illegality and contravened the fundamental policy of Indian law. The award was challenged under section 34 of the Arbitration and Conciliation Act (act). The court set aside the award in which South Eastern Railway (railway) was directed to reimburse the respondent towards service tax and interest. Brief Facts The dispute emerged from the contract...

AO Can't Refer Assessee's File To Joint Commissioner For Levying Penalty U/S 271D Of IT Act Without Recording “Satisfaction”: Delhi HC

The Andhra Pradesh High Court has held that an Assessing Officer cannot refer an assessee's file to the Joint Commissioner of Income Tax for levying penalty under Section 271D of the Income Tax Act, 1961 without recording its “satisfaction”.Section 271D of the Income Tax Act prescribes the penalty to be imposed on a taxpayer for taking loan or deposits in contravention of Section 269SS. As per Section 269SS, all loans or deposits of over Rs.20,000 must be taken through banking...

[Income Tax] Non-Functionality Of TRACES Portal Can't Be Ground To Deny Benefit Of Statutory Rights To Assessee: MP High Court

The Madhya Pradesh High Court has made it clear that non-functionality of Income Tax Department's TRACES Portal cannot be grounds for denying the benefit arising to an assessee under statutory provisions of the Income Tax Act, 1961. A division bench of Justices Vivek Rusia and Anuradha Shukla thus held that an assessee' TDS refund cannot be denied merely on the ground that functionality of 'adjustment of refund' against outstanding demand made by the Department is not presently...

Due Date For Employer To Deposit Employee's Contribution To PF Not Governed By S.43B Income Tax Act: Rajasthan HC Reiterates

The Rajasthan High Court has reiterated that share of the employee in the provident fund deducted by the employer, has to be deposited as per the due date fixed by the EPF Act and ESI Act, and not as per Section 43B of the Income Tax Act, 1961. The Scheme framed under Employees' Provident Funds and Miscellaneous Provisions Act, 1952 (EPF Act) provides that employee's contribution shall be deposited with the Central government “within fifteen days of the close of every month”. ...