Tax Cases Monthly Round Up: December 2023

Delhi High Court High-End KPO Services Provider Can't Be Compared With ITeS, Which Is BPO Services Provider: Delhi High Court Case Title: PCIT Versus Future First Info. Services Pvt. Ltd. Citation: 2023 LiveLaw (Del) 1301 The Delhi High Court has held that the high-end knowledge process outsourcing (KPO) services provider cannot be compared with the information technology-enabled services (ITeS), which fall under the category of BPO services provider. No Upward Adjustment...

Tax Cases Weekly Round-Up: 24 To 30 December, 2023

Delhi High Court Refund Application Could Not Be Uploaded Due To Technical Glitches, Refund Can't Be Denied: Delhi High Court Citation: 2023 LiveLaw (Del) 1351 Case Title: M/S Sethi Sons (India) Versus Assistant Commissioner And Ors. The Delhi High Court has held that the refund application was filed twice on the GST portal but could not be uploaded due to technical glitches. Delhi High Court Upholds Constitutional Validity Of Section 115BBE Of Income Tax Act ...

18% GST Applicable On F-18 Drugs Used For Cancer Diagnosis: AAR

The Uttar Pradesh Authority of Advance Ruling (AAR) has held that 18% GST is applicable on F-18 drugs used for cancer diagnosis.The bench of Amit Kumar and Harilal Prajapati has observed that F18 is a radioisotope and fluorodeoxyglucose (18F-FDG) is a compound. The products being radioactive and compounds of the radioisotope 18F merit classification under heading 2844 only, although they satisfy the condition mentioned in Chapter 30, i.e., a diagnostic reagent designed to be administered to the...

Goods Used In Fabrication Of Structures Embedded To Earth To Be Treated As 'Inputs': CESTAT Allows Cenvat Credit To SAIL

The Kolkata Bench of Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has allowed the cenvat credit to the Steel Authority of India Limited (SAIL).The bench of R. Muralidhar (Judicial Member) and K. Anpazhakan (Technical Member) has observed that the 'plates' used for the fabrication of capital goods are inputs for the capital goods, and hence they are eligible for the credit availed on the 'plates' as 'inputs'.The appellant/assessee, SAIL, is in the business of manufacturing iron...

ITAT Deletes Additions Against Unsuspecting Investor In A 'Penny Stock' To Make Quick Profit

The Mumbai Bench of Income Tax Appellate Tribunal (ITAT) has held that the assessee was an unsuspecting investor who transacted in a 'penny stock' with a view to earning a quick profit, and since his involvement in any dubious transaction relating to price rigging or connection with exit providers could not be shown, the transaction could not be treated as a 'pre-arranged' one even if there were no underlying fundamentals in or financial performance by the company whose shares were sold.The...

ITAT Deletes S. 68 Addition Towards Cash Receipts Subsequently Converted Into Sale Of Jewellery

The Chennai Bench of Income Tax Appellate Tribunal (ITAT) has deleted the addition under Section 68 of the Income Tax Act towards cash receipts, which were subsequently converted into the sale of jewellery.The bench of Mahavir Singh (Vice President) and Manjunatha. G (Accountant Member) has observed that there cannot be any reason for uniform sales on all days, months, or years. There may be various reasons for an increase or decrease in sales that depend on various factors, including festival...

Empty Liquor Bottles Can't Be Included In Scrap, TCS Not Applicable: Madras High Court

The Madras High Court has held that empty liquor bottles cannot be included in scrap, and TCS is not applicable.The bench of Justice C. Saravanan has observed that the petitioner is neither the owner of the bottle nor generates scrap as is contemplated under the Income Tax Act, 1961. The activity of opening and uncorking is not a “mechanical working of material." Therefore, the invocation of Sections 206C, 206CC, and 206CCA of the Income Tax Act, 1961, was wholly misplaced and unwarranted under...

All You Need To Know About GST Applicability On Supplies Of Restaurant Service Through E-Commerce Operators

The GST Council in its 45th meeting held on 17th September 2021 recommended notifying “Restaurant Service” under section 9(5) of the CGST Act, 2017. Accordingly, the tax on supplies of restaurant services supplied through e-commerce operators shall be paid by the e-commerce operator.Here are 7 points you need to know about the applicability of GST on supplies of restaurant services supplied through e-commerce operators:1. ECOs not required to collect TCS and file GSTR 8As 'restaurant service'...

Appellant Not Required To Deposit 10% Of Entire Disputed Amount Including Penalty, Fine, Interest: Karnataka High Court

The Karnataka High Court has set aside the order passed by the Appellate Authority to deposit 10% of the entire amount in dispute, which included tax, interest, a fine, a fee, and a penalty.The bench of Justice Sachin Shankar Magadum has observed that while filing the appeal under Section 107(6) of the GST Act, the appellant is required to deposit only 10% of the disputed tax amount and not 10% of the entire disputed amount, including penalty, fine, and interest.The appellate authority, while...

Order Cancelling GST Registration Was Passed In Violation Of Principles Of Natural Justice: Delhi High Court

The Delhi High Court has held that the order cancelling the petitioner's GST registration was passed in violation of the principles of natural justice and is, thus, liable to be set aside.The bench of Justice Vibhu Bakhru and Justice Amit Mahajan has observed that if the petitioner's GST registration is restored, the petitioner would be obliged to update its returns for the period after its GST registration was cancelled. This would enable the Department to examine not only the business carried...

Govt. Allows Appointment Of Advocates With 10 Years Of Experience In Indirect Tax Matters To Appellate Tribunal

The Ministry of Law and Justice has notified the Central Goods and Services Tax (Second Amendment) Act, 2023.Section 110 of the Central Goods and Services Tax Act, 2017 is modified by the CGST (Second Amendment) Act. A subclause permitting the appointment of advocates with ten years of experience in indirect tax disputes to the Appellate Tribunal is one of the revisions.A clause is introduced stating that only those under fifty years old are eligible to hold the roles of President or Member. In...

Patna High Court Overturns GST Appeal Dismissal Citing Conditions in Notification No. 53 of 2023-Central Tax

In a recent ruling, the Patna High Court overturned the dismissal of a GST appeal and reinstated the appeal, contingent upon meeting specified conditions outlined in Notification No. 53 of 2023-Central Tax.Emphasizing the significance of adhering to statutory timelines while recognizing the opportunities provided by relevant notifications to revive dismissed appeals under specific conditions, the division bench of Chief Justice K. Vinod Chandran and Justice Rajiv Roy stated, “In this context,...