Tax
No Profiteering Where Builder Absorbs Differential GST Burden: GSTAT
The Principal Bench of the Goods and Services Tax Appellate Tribunal (GSTAT), New Delhi, held that anti-profiteering proceedings cannot be sustained in the absence of evidence showing that GST benefits were withheld from homebuyers, and accordingly closed two separate complaints against real estate developers—Raja Housing and Legacy Global. Both matters were heard together by a Bench presided over by Justice (Retd.) Dr. Sanjaya Kumar Mishra. In both cases, the Director General of...
Joint Venture MoU For Sugar Mill Modernisation Not Taxable: CESTAT Chandigarh
The Chandigarh Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has held that amounts received by a sugar mill under a co-generation and modernisation Memorandum of Understanding (MoU) cannot be treated as consideration for renting of immovable property and are therefore not liable to service tax. Setting aside a service tax demand of over Rs. 21 lakh, the Bench comprising S.S. Garg (Judicial Member) and P. Anjani Kumar (Technical Member) observed that in the case at...
Gauhati High Court Stays GST Demand On Flats Given For Free To Landowners
The Gauhati High Court on 7 January stayed coercive action pursuant to a GST demand raised on flats provided free of cost to landowners under a development agreement. A Bench of Justice Soumitra Saikia was hearing a writ petition filed by a developer challenging a consolidated show cause notice issued under Section 74 of the Central Goods and Services Tax Act, 2017 (CGST), covering multiple financial years from 2017–18 to 2022–23. The notices proposed a levy of GST on flats handed over free of...
Supreme Court Holds Tiger Global's $1.6 Billion Flipkart Stake Sale Taxable In India
On 15 January, the Supreme Court held that capital gains arising from Tiger Global's 1.6 billion USD stake sale in Flipkart to Walmart are taxable in India. The Bench of Justice J.B. Pardiwala and Justice R. Mahadevan set aside the Delhi High Court's judgment, which had quashed the tax demand based on an order of the Authority for Advance Rulings (AAR). The top court held that on preliminary assessment, the transaction was designed to avoid the payment of income tax in India. The dispute...
Suppliers' Failure To File Income Tax Returns Alone Can't Render Purchases Bogus: ITAT Chandigarh
The Chandigarh Bench of the Income Tax Appellate Tribunal (ITAT) has recently observed that purchases cannot be treated as bogus only because some suppliers failed to file income tax returns or did not respond to departmental notices when the transactions are otherwise supported by records. Explaining this, a bench of Vice President Rajpal Yadav and Accountant Member Manoj Kumar Aggarwal observed that in the fctas of the case, the tax department had accepted the taxpayer's sales and had not...
Andhra Pradesh High Court Upholds 200% VAT Penalty On Trader For Bogus Bill Trading
The Andhra Pradesh High Court has upheld a penalty equal to 200% of the tax imposed on an iron and steel trader for issuing false tax invoices without actual movement of goods to facilitate wrongful availment of input tax credit. A Division Bench of Justice R. Raghunandan Rao and Justice T.C.D. Sekhar dismissed a writ petition challenging a penalty of Rs 50.52 lakh levied under Section 55(2) of the Andhra Pradesh Value Added Tax Act, 2005, for the period from June 2014 to June 2016. The...
ITAT Sets Aside Penalty Against Taxpayer For Receiving Property Sale Price In Cash At Registration
The Chandigarh Bench of the Income Tax Appellate Tribunal (ITAT) recently quashed a penalty of Rs. 7.41 lakh imposed on a Ludhiana resident for receiving the sale consideration of a plot in cash at the time the sale deed was registered. The order was passed by Accountant Member Manoj Kumar Aggarwal, who held that the penalty had been wrongly imposed, as the cash was received in a single transaction at the time of execution of a registered sale deed and not as an advance. On those facts, the...
Fortis Not Liable To Pay ₹50 Lakh Service Tax On Facilities Provided To Visiting Doctors: CESTAT Chandigarh
The Chandigarh Bench of the Customs, Excise and Service Tax Appellate Tribunal has recently held that Fortis Healthcare is not liable to pay service tax on infrastructure and administrative facilities provided to visiting doctors. A coram of Judicial Member S.S. Garg and Technical Member P. Anjani Kumar said the arrangement was part of delivering medical treatment and not a separate taxable service. Allowing the appeal, the tribunal held that such services “do not fall under the category of...
GST Proceedings Cannot Be Initiated Against Deceased Proprietor: Andhra Pradesh High Court Reiterates
The Andhra Pradesh High Court has recently reiterated that GST authorities cannot initiate assessment or adjudication proceedings in the name of a deceased proprietor, even where the tax demand relates to a period when the business was active. A Division Bench of Justice R. Raghunandan Rao and Justice T.C.D. Sekhar clarified that Section 93 of the Central Goods and Services Tax Act, a provision that allows recovery of tax payable by deceased persons, does not authorise the initiation of fresh...
Andhra Pradesh High Court Holds Solar Power EPC Contract Eligible for 8.9% GST, Quashes 18% Demand
The Andhra Pradesh High Court has recently ruled that contracts for setting up solar power generating systems cannot be taxed at 18% GST merely because they involve erection and commissioning work. Holding that such contracts are covered by a concessional GST notification, the court said tax must be levied at an effective rate of 8.9% and set aside a higher assessment raised by GST authorities. A division bench of Justices R. Raghunandan Rao and T.C.D. Sekhar said the benefit of the...