CESTAT Chandigarh Sets Aside ₹2.39 Crore Service Tax Demand Against SBI Card

The Customs, Excise, and Service Tax Appellate Tribunal (CESTAT), Chandigarh, has set aside a ₹2.39 crore service tax demand against SBI Card and Payment Services Ltd., holding that a show cause notice (SCN) that fails to identify the taxable service, the service recipient or the consideration cannot sustain such a demand. The tribunal observed, "We find that the SCN does not specify as to what was the service rendered by the appellants and to whom and what was the consideration thereon."A bench...

Xerox's 'Kitting' Of Imported Photocopier Modules Is Not 'Manufacture': Supreme Court Upholds CESTAT Ruling

The Supreme Court has held that Xerox India's practice of grouping, plugging and pinning imported photocopier modules according to customers' requirements, commonly known as "kitting", did not amount to "manufacture" under Section 2(f) of the Central Excise Act, 1944. As no manufacturing activity was found, the company was not liable to pay central excise duty. The court reiterated that a process amounts to manufacture only if it results in a new product with a distinct name, character, and...

Gujarat High Court Rejects Plea Against Tribunal Order Granting VAT Exemption For Seeds Used For Sowing

The Gujarat High Court has dismissed the State's plea against Western Agri Seeds Ltd., ruling that the state failed to prove the company's seeds were not used for sowing and were therefore outside the scope of the Value Added Tax exemption notification. "The petitioner Department has miserably failed to prove before us that the seeds which are procured by the respondents are not used for sowing purposes," the court observed while upholding the Gujarat VAT tribunal's decision to quash...

ITAT Mumbai Quashes PCIT Revision Against Mumbai Trader As 'Larger Issue' Was Already Under Appeal

The Mumbai bench of the Income Tax Appellate Tribunal (ITAT) has refused to uphold the Principal Commissioner of Income Tax's (PCIT) attempt to revise the assessment of a Mumbai-based trading company over alleged bogus purchases, ruling that the dispute was already pending before the Commissioner of Income Tax (Appeals) [CIT(A)]. A coram of Judicial Member Challa Nagendra Prasad and Accountant Member Prabhash Shankar observed, "The larger issue as to whether the purchases made by the assessee...

COVID Limitation Extension Can't Revive Time-Barred Service Tax Demands: CESTAT Kolkata

The Customs, Excise, and Service Tax Appellate Tribunal (CESTAT), Kolkata, has ruled that the COVID-19-related extension of limitation cannot revive tax demands that had already become time-barred under the statute. A coram of Judicial Member R. Muralidhar and Technical Member K. Anpazhakan observed, "The subsequent exclusion of limitation during the pandemic cannot revive a cause of action or breathe life into a demand which had already become time-barred under the statute. The law relating to...

Madras High Court Says Tax Authorities Must Consider Demerger Impact, Remands Grace Infrastructure Case

The Madras High Court on 20 July held that tax authorities must consider the impact of a court-approved demerger before revising an assessment and set aside a revision order passed without examining the effect of the restructuring on Grace Infrastructure Private Limited's financial statements. Justice C. Saravanan remitted the matter to the Principal Commissioner of Income Tax for fresh adjudication, directing it to reconsider the assessment after allowing the company to file a revised return...

Income Tax Findings Have Evidentiary Value In Benami Proceedings: Rajasthan High Court

On 3 August, the Rajasthan High Court held that findings under the Income Tax Act, though not conclusive in proceedings under the Prohibition of Benami Property Transactions (PBPT) Act, have evidentiary value and must be considered by authorities deciding benami proceedings. A Division Bench of Justices Arun Monga and Sandeep Shah allowed an appeal filed by Alishan Complex Private Limited against orders passed by the Appellate Tribunal, Adjudicating Authority and Initiating Officer, which had...

Passenger Carrying Undeclared Gold Has No Entitlement to Seek Its Re-Export: Delhi High Court

The Delhi High Court has held that passengers who cross the Green Channel without declaring dutiable or prohibited goods cannot later seek re-export of the confiscated goods under Section 125 of the Customs Act.For context, Section 125 empowers the adjudicating authority to grant an option to redeem confiscated goods upon payment of a redemption fine.The Division Bench of Justices Anil Kshetarpal and Shail Jain observed that the provision is not an “entitlement” to re-export the goods. After...

Delay In Filing Certificate Not Ground To Deny Property Tax Exemption To School: Chhattisgarh High Court

The Chhattisgarh High Court on 31 July held that a municipal authority cannot reject a property tax exemption claim merely because a school did not submit its Section 12AA registration certificate under the Income Tax Act, 1961 (which grants tax exemption to charitable institutions) along with its initial self assessment or representation.Justice Parth Prateem Sahu disposed of the writ petition filed by Riverdale World School, which challenged a demand notice seeking recovery of Rs. 30,808...

Sugar Export Ban Was Well Thought Out, Not A Knee-Jerk Reaction: Bombay High Court

Holding that the export ban was a well-thought-out policy decision taken in public interest, the court dismissed exporters' challenge to the DGFT notification.

S. 76 CGST Act | Appellate Authority Can Decide Reasonable Period For Issuing Show Cause Notice: Delhi High Court

The Delhi High Court has held that the GST Appellate Authority is competent to decide what constitutes a "reasonable period" for issuance of a show cause notice under Section 76 of the Central Goods and Services Tax (CGST) Act, 2017.The Division Bench of Justices Anil Kshetrapal and Shail Jain thus refused to entertain a writ petition in this regard, by bypassing the statutory appellate remedy.The petition was filed by a security services company, challenging a show cause notice dated September...

CESTAT Chandigarh Allows CENVAT Credit On Inputs From Exempt Units, Grants Relief To Reckitt Benckiser

The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Chandigarh, has ruled that consumer goods maker Reckitt Benckiser India Ltd. was entitled to claim CENVAT credit on duty-paid raw materials purchased from certain tax-exempt manufacturers.It held that the benefit could not be denied simply because the law was amended later to expressly allow it. "We find that before the amendment there was no express prohibition in the CENVAT Credit Rules so as to deny such credit availed by the...