Tax
GST Department Must Decide Refund Applications Expeditiously, Any Delay Adversely Affects Business: Delhi High Court
The Delhi High Court has called upon the Goods and Services Tax Department to expeditiously process the refund applications filed by registered persons/ entities.A division bench of Justices Prathiba M. Singh and Shail Jain observed, “As per the statutorily prescribed procedure, the refund applications have to be dealt with in a particular manner within the prescribed timelines as per law…if there is delay by the Department in processing and granting refunds, it has a cascading adverse effect on...
Furnace Oil Not On Par With 'Plant And Machinery', Unrelated To Goods Dispatched For Complete Sales Tax Set-Off: Bombay High Court
The Bombay High Court on Wednesday held that manufacturers cannot claim full sales tax set-off on furnace oil used in producing goods that are partly sold within Maharashtra and partly transferred to branches outside the state, ruling that a 6% reduction must apply under Rule 41D(3)(a) of the Bombay Sales Tax Rules, 1959. Assessee sought to put forth that Furnace oil is a consumable used in manufacturing but not part of the finished goods dispatched, and therefore, it cannot be...
Delhi High Court Raps Income Tax Dept For Over Two-Year Delay In Implementing ITAT Order; Directs Refund With Interest Within One Month
The Delhi High Court recently criticized the Income Tax Department for an over 2-year delay in implementing an ITAT order, directing it to reconsider the demand raised against an assessee.A division bench of Justices Prathiba M. Singh and aShail Jain observed that the Income Tax Department must implement judicial orders with “alacrity” however in this case, it woke up only after the assessee moved the High Court to seek enforcement of the ITAT order passed back in January 2023.“The Court notes...
Informer Of GST Evasion Cannot Seek Reward As A Matter Of Right: Delhi High Court
The Delhi High Court has prima facie observed that an informer, who apprises the Department about evasion of goods and services tax by an entity, cannot seek reward for sharing such information as a matter of right.A division bench of Justices Prathiba M. Singh and Shail Jain were of the prima facie view that no such right vests in any informer.“In the opinion of this Court, the grant of an award or a reward to an informer is a discretionary grant,” it said.The development comes in a petition...
GST Dept Can't Raise Fresh Demand U/S 73 If Explanation Offered By Assessee U/S 61(2) Was Accepted: Delhi High Court
The Delhi High Court has made it clear that Section 61(2) of the Goods and Service Tax Act, 2017 bars further action against an assessee, including any demand under Section 73.For context, Section 61 empowers the proper officer to scrutinize the return furnished by the registered person and inform him of the discrepancies noticed.Sub-section (2) thereof provides that in case the explanation offered by the registered person is found to be acceptable, no further action shall be taken.A division...
Income Tax Act | Reassessment Beyond Four Years Invalid When Original Assessment Finalised U/S 143(3): Punjab & Haryana High Court
The Punjab and Haryana High Court has held that re-assessment proceedings beyond four years are invalid when the original assessment has been finalised under Section 143(3) of the Income Tax Act. In case of an Assessment under Section 143(3) of the Income Tax Act, a scrutiny is carried out to confirm the correctness and genuineness of various claims, deductions, etc., made by the taxpayer in the return of income. Justices Lisa Gill and Meenakshi I. Mehta stated that the assessing ...
Delhi High Court Sets Aside Reassessment Order Against Vedanta; Orders Fresh Consideration After GST Case Over Alleged ₹424-Crore ITC Fraud Closed
In granting relief to Vedanta Limited, the Delhi High Court has set aside an order of the the Income Tax Department for initiation of reassessment action against the Copper manufacturer, over alleged fraudulent availment of Input tax credit worth over ₹424 Crore.A division bench of Justices Prathiba M. Singh and Shail Jain observed that the GST Department had already closed the case.“Closing of the proceedings by the GST Department would have an impact and bearing on the Section 148A proceedings...
Externally Procured Parts Supplied To Customer For Assembly, But Not Used By Manufacturer, Aren't Liable To Excise Duty : Supreme Court
The Supreme Court on Monday (November 10) dismissed the Revenue Department's excise duty demand against a company that had manufactured and erected a large boiler at a customer's site, holding that the full contract value could not be subjected to central excise duty. The Court clarified that parts bought out externally and supplied to the customer for assembly, but not actually used by the manufacturer, would not attract excise duty. “we arrive at the finding that the final product that...
Conduct Inter-Ministerial Consultation On Whether Import Of Massagers/Sex Toys Is Allowed Or Not: Delhi High Court Tells CBIC
The Delhi High Court has directed the CBIC (Central Board of Indirect Taxes and Customs) to conduct inter-ministerial consultation in respect of coming up with a uniform policy permitting or prohibiting the import of products declared as 'body massagers' or sex toys. The bench opined that the question as to whether any product is obscene or not cannot, obviously, be left at the discretion of the Commissioner of Customs and other individual officials in the absence of uniform guidelines...
Private Hospitals Liable To Pay VAT On Supply Of Medicines & Implants To In-Patients: Gujarat High Court
The Gujarat High Court has held that the supply of medicines and implants by private hospitals to in-patients amounts to 'deemed sale' and is liable to VAT (Value Added Tax). The issue before the bench was whether the supply of medicines, stents, implants, consumables, etc., during the course of treatment of patients amounts to 'sale' as defined in section 2(23) of the VAT Act. The bench, consisting of Justices Bhargav D. Karia and D.N. Ray, observed that after the 46th Amendment...
Working Men/Women's Hostels Are Residential Properties, Cannot Be Taxed At Commercial Rates: Madras High Court
The Madras High Court has recently ruled that hostels providing accommodation to working men and women are residential properties and, therefore, property tax, water tax, and electricity charges cannot be levied at commercial rates. The ruling came in response to petitions filed by hostel owners in Chennai and Coimbatore challenging Chennai municipal authorities and the Chennai Metropolitan Water Supply and Sewerage Board (CMWSSB) for reclassifying their hostels from residential to commercial...
CENVAT Rules Cannot Apply Retrospectively To Concluded MODVAT Proceedings: Allahabad High Court
Recently, the Allahabad High Court has held that where proceedings under the MODVAT (Modified Value Added Tax) Scheme had concluded prior to the introduction of the CENVAT (Central Value Added Tax) Rules, it would not be open to the revenue department to issue fresh notices against the assessee under the new scheme. The MODVAT scheme, allowing manufacturers a tax credit on input duties, was replaced on 01.07.2001 by the CENVAT scheme. This was later codified as the CENVAT Credit Rules...