Author: admin_gst

Circulars – GST – States – Highlights – This circular clarifies various issues related to taxability and valuation of supply of services involving corporate guarantees provided between related persons. It covers applicability of Rule 28(2) of CGST Rules retrospectively, valuation methodologies based on amount guaranteed or actual consideration, treatment of partial loan disbursals, takeovers, co-guarantors, reverse charge mechanism for foreign guarantors, periodicity of valuation, benefit of value declared in invoice, and exclusion of exports from Rule 28(2). The circular aims to ensure uniform implementation across field formations. – TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts Tax Management India – taxmanagementindia – taxmanagement – taxmanagementindia.com – TMI – TaxTMI – TMITax

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Case-Laws – GST – Highlights – The High Court held that once a proper officer initiates proceedings on a subject matter under the Central Goods and Services Tax Act, 2017 (CGST Act) or the Haryana Goods and Services Tax Act, 2017 (HGST Act), no other proper officer can initiate proceedings on the same subject matter. The power exercised by the proper officer u/ss 69, 70, 71, and 72 of the CGST Act is judicial, and every inquiry is deemed a judicial proceeding. Issuance of a show cause notice marks the commencement of legal proceedings. The CGST Act and HGST Act do not provide for transferring proceedings from one proper officer to another. The State Tax Officer who initiated proceedings is empowered to summon evidence and documents. The availability of information about fraudulent ITC availed by related firms does not justify transferring proceedings to another authority. Independent action against other firms does not impede proceedings against the firm under investigation. New information can be shared with the investigating authority. The Excise & Taxation Officer lacked jurisdiction to transfer proceedings to the Central Government. The proceedings initiated u/s 74(1) of the HGST Act against the petitioner company shall continue with the Excise & Taxation Officer-cum-proper officer, who shall examine all aspects revealed relating to tax evasion or ITC. – TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts Tax Management India – taxmanagementindia – taxmanagement – taxmanagementindia.com – TMI – TaxTMI – TMITax

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Case-Laws – GST – Highlights – Doctrine of merger inapplicable. Cancellation of petitioner's registration without assigning reasons violates principles of natural justice. Reasons form heart and soul of judicial and administrative orders, absence renders order unjustified. Despite dismissal of appeal on ground of delay, doctrine of merger has no application considering facts. Rule 23 mandates service of notice to provide opportunity for revocation application, preventing permanent cancellation and business impediment. Coordinate Bench held that once returns accepted and no dues remain, Department should not obstruct business. Order cancelling registration quashed, petitioner directed to file reply to show cause notice within three weeks. Petition allowed. – TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts Tax Management India – taxmanagementindia – taxmanagement – taxmanagementindia.com – TMI – TaxTMI – TMITax

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Case-Laws – GST – Highlights – The petitioner challenged the impugned order and recovery notice issued by the respondent, claiming that the entire tax liability had been paid by reversing the wrongly availed Input Tax Credit (ITC). The court held that the petitioner had already paid the entire tax demand and was only seeking an opportunity to file a reply to the show cause notice and personal hearing regarding the imposition of interest and penalty, which the petitioner claimed not to be liable for. Additionally, as per the decision taken in the 53rd GST Council Meeting, the time was extended until March 31, 2025. By applying the proposed amendment to Section 128(A) of the Act, the petitioner was not liable to pay any amount since sufficient ITC was available. The impugned order was set aside, and the matter was remanded to the respondent for fresh consideration regarding the assessment years 2017-2018. Consequently, the final notice dated 05.05.2023 was also set aside. The petition was disposed of by way of remand. – TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts Tax Management India – taxmanagementindia – taxmanagement – taxmanagementindia.com – TMI – TaxTMI – TMITax

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Case-Laws – GST – Highlights – The High Court held that the Show Cause Notice (SCN) demanding Integrated Goods and Services Tax (IGST) on the activity of holding equity capital by the Holding Companies in the Petitioner company and on the External Commercial Borrowing (ECB) received by the Petitioner from AOSH was not properly considered. The court quashed the SCN insofar as it relates to the proposal to levy/demand GST on 'Continuous Equity Share holding' and remitted the matter back to the respondent for reconsideration after providing an opportunity to the petitioner regarding the issue of 'Value of the Credit Grant in Service determined as a service fee @1%'. The petitioner was granted liberty to submit its response on this issue within four weeks. – TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts Tax Management India – taxmanagementindia – taxmanagement – taxmanagementindia.com – TMI – TaxTMI – TMITax

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Case-Laws – GST – Highlights – Petitioner challenged assessment order for discrepancies between ITC claimed in GSTR-3B and GSTR-2A due to lack of time to furnish self-declarations from suppliers, violating natural justice principles. Court set aside impugned order, granting petitioner two weeks to file suppliers' self-declarations for reconsideration by respondent, disposing writ petition. – TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts Tax Management India – taxmanagementindia – taxmanagement – taxmanagementindia.com – TMI – TaxTMI – TMITax

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Case-Laws – GST – Highlights – Petition regarding cancellation of GST registration and seeking restoration. Delay of six months in filing returns. Court found petitioner's reason for non-compliance bona fide. Petitioner directed to file pending returns with tax dues, interest, and late fee within 45 days. Cancellation of registration revoked subject to fulfilling conditions. Petition disposed. – TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts Tax Management India – taxmanagementindia – taxmanagement – taxmanagementindia.com – TMI – TaxTMI – TMITax

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Case-Laws – GST – Highlights – Violation of principles of natural justice by not providing sufficient opportunity to the petitioner to substantiate their claim. The respondent wrongfully availed input tax credit on the purchase of motor vehicles, reflected in GSTR-2A, and the corresponding GSTR-3B, violating Section 17(5) of the TNGST/CGST Acts. The court held that the respondent's order was passed without giving reasonable opportunity to the petitioner, violating natural justice principles. The petitioner claimed unawareness of the notice issued through the GST Portal and could establish their case if given an opportunity. The petitioner's appeal against the impugned order was dismissed solely on the ground of no provision to condone the delay. Considering the facts and circumstances, the court condoned the delay in filing the appeal by the petitioner before the Appellate Authority in the interest of justice. The petition was disposed of. – TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts Tax Management India – taxmanagementindia – taxmanagement – taxmanagementindia.com – TMI – TaxTMI – TMITax

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Case-Laws – GST – Highlights – The court granted bail to the accused in a case involving clandestine supply of branded TMT bars and evasion of GST. The prosecution's case was based solely on the statement of Rippan Kansal, with no incriminating evidence found during the search and inspection of the applicant's premises. The court considered the reliability of the statement and observed that the alleged offense is punishable with a maximum imprisonment of five years. Given the applicant's prolonged incarceration since 20.6.2024 without trial commencement, the court opined that the applicant made out a case for bail. The bail application was allowed, subject to fulfillment of conditions imposed by the court. – TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts Tax Management India – taxmanagementindia – taxmanagement – taxmanagementindia.com – TMI – TaxTMI – TMITax

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Case-Laws – GST – Highlights – The respondent failed to process the petitioner's application for cancellation of GST registration, citing reasons such as the requirement to pay due tax and penalties, and submit details like stock register and bank statements. The court held that these grounds were untenable, as the cancellation of GST registration would not impinge upon the petitioner's liability to pay outstanding taxes and penalties. The scrutiny of the petitioner's tax liability for a prior period cannot be a ground for refusing cancellation of GST registration. The respondent was directed to process the petitioner's application for cancellation of GST registration, and the petition was disposed of. – TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts Tax Management India – taxmanagementindia – taxmanagement – taxmanagementindia.com – TMI – TaxTMI – TMITax

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Case-Laws – GST – Highlights – Grant of bail involving wrongful availment of input tax credit by generating fake invoices causing wrongful gain to companies and wrongful loss to the Government. Court analyzed whether evidence available against petitioner regarding committing offense under CGST Act. Held that absence of material indicating accused petitioner as manager of firms not essential for prosecution u/s 132 of CGST Act. Provisions state whoever commits or causes to commit and retains benefits from supplies without invoice or without supplying goods avails input tax credit is liable. Court below erred in assessing consequence and spirit of Section 132. Incriminating material against petitioner ignored. While considering bail, gravity of offenses and misconstruing facts and legal position not considered. Cancellation of bail allowed, order granting bail set aside. – TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts Tax Management India – taxmanagementindia – taxmanagement – taxmanagementindia.com – TMI – TaxTMI – TMITax

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Case-Laws – GST – Highlights – The case pertains to a violation of the principles of natural justice, wherein the petitioner's right to an opportunity for personal hearing, as provided under the law, was violated. The court held that Section 75 of the RGST Act/CGST Act contains provisions related to tax determination. Sub-section (2) states that if an Appellate Authority, Tribunal, or Court concludes that the notice issued u/s 74(1) is unsustainable due to non-establishment of fraud, willful misstatement, or suppression of facts to evade tax, the proper officer shall determine the tax payable as if the notice was issued u/s 73(1). The respondents admitted that although they intended to grant an opportunity for personal hearing and uploaded notices, the petitioner claimed these were not reflected on their GSTIN Portal. The court found the statutory mandate was not complied with, and impugned orders were passed without affording the petitioner an opportunity for personal hearing. Consequently, the matters were remanded to the competent authority to provide an opportunity for personal hearing and pass appropriate orders in accordance with the law. – TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts Tax Management India – taxmanagementindia – taxmanagement – taxmanagementindia.com – TMI – TaxTMI – TMITax

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Case-Laws – GST – Highlights – The petitioner's products were previously classified under heading 7615 of the Customs Tariff Act, 1975, but the Department contended that some products should be classified under heading 7607. The High Court had earlier allowed the petitioner's writ petitions challenging a similar order, following the Supreme Court's order in Commissioner of Central Excise vs. Hindalco Industries Limited, holding that the Aluminium Foil Container is classifiable under 7615 with 12% GST. Consequently, the High Court allowed the present writ petitions and directed the refund of the pre-deposited amount by the petitioner within 30 days, as the order was accepted by the Commissioner GST Central Excise, Madurai. – TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts Tax Management India – taxmanagementindia – taxmanagement – taxmanagementindia.com – TMI – TaxTMI – TMITax

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Case-Laws – GST – Highlights – The case pertains to revocation of cancelled GST registration due to non-filing of returns for a continuous period exceeding twelve months. The petitioner cited the resurgence of the COVID-19 pandemic as the reason for not conducting business during that period. The High Court referred to the Suguna Cutpiece case, where GST registration was restored subject to certain terms and conditions. Following the precedent, the court directed restoration of the petitioner's GST registration, contingent upon fulfilling the stipulated conditions. The petition was disposed of accordingly. – TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts Tax Management India – taxmanagementindia – taxmanagement – taxmanagementindia.com – TMI – TaxTMI – TMITax

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Case-Laws – GST – Highlights – The AAR ruled that organizing physical/offline games or tournaments of contract bridge played for money does not constitute supply of 'specified actionable claims' u/s 2(102A) of the GST Act, 2017. Contract bridge is predominantly a game of skill, not chance. The organizer neither provides an online platform nor retains any platform fee from players' contributions. The money contributed by players is deposited in a common pool, and the organizer has no lien over it. Organizing a tournament and allowing participation against a fee qualifies as supply of services by the organizer to participants. However, even if playing bridge for money is considered a 'specified actionable claim', the organizer cannot be deemed a supplier since they do not have control over the pooled money. Therefore, the organizer is not liable to pay GST for organizing physical/offline contract bridge tournaments played for money. – TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts Tax Management India – taxmanagementindia – taxmanagement – taxmanagementindia.com – TMI – TaxTMI – TMITax

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Case-Laws – GST – Highlights – Petitioner challenged the provisional attachment of his bank account u/s 83 of the CGST Act by invoking the jurisdiction of the High Court under Article 226 of the Constitution. However, the Court found contradictions in the petitioner's statements regarding his permanent address and business location. Combined with the respondents' assertions of the petitioner being non-genuine, the Court concluded that the petitioner was committing fraud on both the Revenue and the Court. Consequently, the Court refused to exercise its discretionary jurisdiction and dismissed the petition. – TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts Tax Management India – taxmanagementindia – taxmanagement – taxmanagementindia.com – TMI – TaxTMI – TMITax

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Case-Laws – GST – Highlights – Section 29(2) of the Limitation Act, 1963 is applicable in relation to the period of limitation under tax laws like the Central Excise Act and the APGST Act. The Supreme Court has held that where the special law restricts the additional period for condonation of delay, it effectively excludes Section 5 of the Limitation Act by necessary implication. Section 107 of the APGST Act prescribes the limitation period for filing appeals and restricts the condonable period to 30 days. Therefore, Section 5 of the Limitation Act stands excluded, and the appellate authority cannot condone delay beyond 30 days u/s 107(4) of the APGST Act. The HC dismissed the petition, upholding the applicability of Section 29(2) and the exclusion of Section 5 in such cases. – TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts Tax Management India – taxmanagementindia – taxmanagement – taxmanagementindia.com – TMI – TaxTMI – TMITax

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Case-Laws – GST – Highlights – The High Court adjudicated a matter concerning refund of an amount deposited under compulsion and provisional attachment of bank accounts. The court refrained from issuing directions for refund, clarifying that the petitioners could apply for refund in accordance with law without awaiting adjudication of the show cause notice. Regarding seized articles and documents, the respondent stated that all hard disks and other articles were returned, except two laptops which were stolen, with an FIR lodged for the same. The petition was consequently disposed of. – TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts Tax Management India – taxmanagementindia – taxmanagement – taxmanagementindia.com – TMI – TaxTMI – TMITax

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Case-Laws – GST – Highlights – The court granted bail to the accused applicant, considering the following factors: the trial has not yet commenced, the applicant's complicity is yet to be determined, relevant evidence is under the department's control, and there is no indication that the applicant's release would adversely affect the trial. Additionally, the alleged offense carries a maximum punishment of five years' imprisonment, and the applicant has already been in jail for a substantial period. The court opined that the applicant has made a case for bail, subject to furnishing personal bonds and sureties to the satisfaction of the concerned court and fulfilling imposed conditions. The decision was based on the Supreme Court's precedents, which emphasize considering the gravity of the offense, the object of the relevant Act, and the attending circumstances, rather than categorizing all economic offenses as one group and denying bail. – TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts Tax Management India – taxmanagementindia – taxmanagement – taxmanagementindia.com – TMI – TaxTMI – TMITax

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Case-Laws – GST – Highlights – Petitioner sought release of provisionally attached bank accounts, return of seized laptops, CPUs, mobile phones and documents, and refund of Rs. 22 lakh allegedly deposited during search and seizure raid. Commissioner justified freezing bank accounts through speaking order. Regarding seized devices, Commissioner directed to examine retaining them beyond 30 days as per Section 67(3) of CGST Act and ensure data access to petitioner. Counter-affidavit by respondents on refund claim not on record, to be filed before next hearing on 20.08.2024. Matter listed accordingly. – TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts Tax Management India – taxmanagementindia – taxmanagement – taxmanagementindia.com – TMI – TaxTMI – TMITax

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Case-Laws – GST – Highlights – Petitioner sought implementation of Appellate Authority's order to release seized gold ornaments due to discrepancy between delivery challan quantity and actual quantity. Court held that although goods are liable for confiscation, they can be released upon payment of fine considering they are petitioner's stock-in-trade. Petitions disposed, directing release of entire 1647.970 grams of seized gold to petitioners upon executing bonds, undertaking not to alienate covered property until proceedings culminate. Parties entitled to approach Appellate Tribunal if aggrieved by Appellate Authority's proceedings. – TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts Tax Management India – taxmanagementindia – taxmanagement – taxmanagementindia.com – TMI – TaxTMI – TMITax

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Case-Laws – GST – Highlights – The High Court dismissed the petition seeking a declaration that the blocking of Input Tax Credit (ITC) was unlawful due to lack of jurisdiction and violation of principles of natural justice. The court held that u/r 86A(1) of the OGST Rules, 2017, the Deputy Commissioner of State Taxes, being higher in rank than an Assistant Commissioner, had jurisdiction to pass the impugned orders relating to State GST. The court clarified that the circular issued by the Government of India on 02.11.2021 is applicable only to Central GST and not State GST unless adopted by the State Government through a declaration, which was not done in this case. Consequently, the claim of lack of jurisdiction and violation of natural justice was rejected, and the petition was disposed of. – TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts Tax Management India – taxmanagementindia – taxmanagement – taxmanagementindia.com – TMI – TaxTMI – TMITax

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Case-Laws – GST – Highlights – Appeal dismissed due to filing beyond statutory limitation period. Petitioner's registration cancelled earlier, failed to avail amnesty scheme allowing restoration upon clearing dues. Petitioner not registered dealer during intervening period, activities unmonitored, transactions unascertainable. Petitioner did not controvert allegation of non-filing returns for six months. Law favors diligent, not indolent. Delay counted against petitioner. Petition dismissed. – TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts Tax Management India – taxmanagementindia – taxmanagement – taxmanagementindia.com – TMI – TaxTMI – TMITax

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Case-Laws – GST – Highlights – The High Court dismissed the appeal, upholding the Single Judge's decision to relegate the appellant to the alternative remedy of replying to the show cause notices and adjudication by the statutory authority. The Department suspected availing of input tax credit on bogus invoices, prompting the issuance of an intimation u/r 86A to prevent irregular availment. Although there was a delay in issuing show cause notices, the appellant did not approach the court during that period. The court found no grounds for belated interference with the intimation under Article 226, as the appellant had the statutory recourse of adjudication after responding to the show cause notices. – TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts Tax Management India – taxmanagementindia – taxmanagement – taxmanagementindia.com – TMI – TaxTMI – TMITax

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Case-Laws – GST – Highlights – The key aspects covered are the applicable GST rates for services provided by the applicant to Maharashtra Jeevan Pradhikaran (MJP) as part of the Jal Jeevan Mission, based on the time of supply. Services provided before 01.01.2022 are exempt under Entry 3 of Notification 12/2017-Central Tax (Rate), while those after 01.01.2022 are taxable at 18% GST. The authority examined whether MJP qualifies as a 'Government Authority' under the exemption entry and concluded that for services after 01.01.2022, MJP does not meet the criteria due to the omission of 'Government Authority' from the entry. The role of MJP as an agency implementing water supply schemes under constitutional provisions was analyzed, with the authority determining that MJP's actions exceed the scope of an agency. The summary covers the key legal aspects, GST rates, and the rationale behind the rulings based on the relevant notifications and constitutional provisions. – TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts Tax Management India – taxmanagementindia – taxmanagement – taxmanagementindia.com – TMI – TaxTMI – TMITax

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