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...

Mere Delay In Filing Form 10-IC Is Not Detrimental To Reduced Rate Of Tax If Taxpayer Satisfies Conditions Of Sec 115BAA: Gujarat HC

Finding that Assessee has satisfied conditions for reduced rate of tax u/s 115BAA, the Gujarat High Court pointed that the Revenue Department should have condoned delay in filing of Form 10-IC instead of rejecting it on technical ground. Section 115BAA of the Income Tax Act allows domestic companies to utilise the provisions of the section and pay tax at a lower tax rate of 22% plus a 10% surcharge and a 4% education cess. The Division Bench comprising Justice Bhargav D. Karia and...

KPO Service Provider Is Not Comparable To ITES Service Provider For Purpose Of Benchmarking International Transactions: Delhi HC

While condoning the delay of 815 days attributable to Revenue in filing of appeal, the Delhi High Court upheld the ITAT's order on the issue of selection of comparable for purposes of benchmarking international transactions of assessee with its AEs. The High Court maintained the status quo in excluding KPO service provider against IT enabled service provider, for benchmarking international transaction. The Division Bench comprising Justice Yashwant Varma and Justice Ravinder ...

Amount Seized From Third Party Is Not Eligible For Adjustment Against Advance Tax Liability Of Assessee: Punjab & Haryana HC

The Punjab & Haryana High Court held that cash seized from possession of another person cannot be adjusted against Assessee's tax liability as advance tax paid by him. The Division Bench comprising Justice Sanjeev Prakash Sharma and Justice Jagmohan Bansal observed “From sub-section (3) of Section 132B, it is evident that person from whose custody assets is seized is entitled to adjustment thereof against the tax liability. As per explanation, existing liability does not include...

'We Can't Run GST Administration' : Supreme Court Dismisses Plea For Rating Mechanism For GST Payers

The Supreme Court on Friday (September 6) dismissed a Public Interest Litigation seeking directions to the Union to formulate and implement a centralized rating mechanism of taxpayers under the Central Goods and Services Tax Act 2017 (CGST Act).The bench led by CJI DY Chandrachud comprising Justices JB Pardiwala and Manoj Misra refused to entertain the PIL since such a relief would fall outside the scope of the Writ Jurisdiction. The CJI, while dismissing the PIL, opined, “That's a matter for...

Extended Period Of Limitation Can't Be Invoked If Officials Are Negligent: CESTAT

The Kolkata Bench of Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has stated that no further investigation was conducted by the Revenue for more than two years after the search, hence the extended period of limitation can't be invoked. The Bench of R. Muralidhar (Judicial Member) and Rajeev Tandon (Technical Member) has observed that “the officials did not take up the further investigation properly and were shoddy at their best. No statements were recorded from the...

Telangana High Court Quashes Tax Authority's Show Cause Notices To Assessee As Demand Was Settled Under State's One Time Settlement Scheme

The Telangana High Court recently quashed two show cause notices issued by the tax authority to a company, demanding tax which was already settled under the state government's One Time Settlement (OTS) scheme, while noting that there was "no allegation of fraud" committed by the company in the notices. A division bench of Justice Sujoy Paul and Justice Namavarapu Rajeshwar Rao in its August 28 order said, that in the "peculiar facts and circumstances of this case", after the petitioner...

Assessee Failed To Explain Huge Variation In Stock And Admitted To Shortage: CESTAT Upholds Penalty Under Section 11 AC(1)(A) Of The Central Excise Act, 1944

The New Delhi Bench of Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has stated that the assessee has failed to explain the huge variation in stock and has admitted to the shortage, making them liable under Section 11AC(1)(A) of the Central Excise Act, 1944. Section 11 AC(1)(A) Of the Central Excise Act, 1944 provides that if any excise duty has not been levied, paid, short-levied, short-paid, or erroneously refunded due to fraud, collusion, willful misstatement,...

Forex Fluctuation Loss Directly Resulting From Trading Items Can't Be Considered As Non-Operating Loss: Delhi High Court

Finding that Assessee/ Petitioner had raised invoices on its AE (Ameriprise USA) based on cost-plus pricing methodology for the specified products & services provided by the Assessee, the Delhi High Court held that foreign exchange loss directly resulting from trading items could not be considered as a non-operating loss. The Division Bench comprising Justice Yashwant Varma and Justice Ravinder Dudeja reiterated that “Since the foreign exchange loss directly resulted from trading...

No Service Tax Can Be Determined Without Clarifying The Category Of Service Under Which The Said Amount Can Be Attributed: CESTAT

The New Delhi Bench of Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has stated that no service tax can be determined without clarifying the category of service under which the said amount can be attributed. Under Section 78 of the Finance Act, 1994, if service tax has not been levied, paid, short-levied, short-paid, or erroneously refunded due to fraud, collusion, willful misstatement, suppression of facts, or contravention with the intent to evade payment, the person...

No Evidence Of Over-Valuation Of Goods; Transaction Value Wrongly Rejected Under Rule 8 of Customs Valuation Rules: CESTAT

The New Delhi Bench of Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has stated that there is no evidence of over-valuation of Goods and the transaction value has been wrongly rejected under Rule 8 of Customs Valuation Rules. Section 113 of the Customs Act, 1952 provides the list of goods that are liable to be confiscation if they are attempted to be improperly exported. Section 113 (a) of the Customs Act, 1952 provides that the goods are liable for confiscation if...

Indian-Subsidiary Which Is Compensated At Arm's Length Can't Be Construed As Dependent Agent PE: Delhi High Court

Finding that subsidiary company (KIPL) is only undertaking marketing enterprise, whereas contracts are finalized and signed by the assessee (Principal company) outside India, the Delhi High Court held that KIPL cannot be said to be habitually securing and concluding order on behalf of assessee, and hence it is not Dependent Agent PE (DAPE) of Assessee. The Division Bench comprising Justice Yashwant Varma and Justice Ravinder Dudeja observed that “for an enterprise to be considered as...