Author: admin_gst

2018 (3) TMI 1055 – RAJASTHAN HIGH COURT – 2018 (361) E.L.T. 37 (Raj.) – Clearance of MS Specials to the water supply projects – benefit of N/N. 47/2002-CE dated 06.09.2002 & N/N. 6/2006-CE dated 01.03.2006 – Whether the ld. CESTAT was right in law in setting aside the demand determined on the basis of non-fulfillment of the conditions of exemption Notification No.47/2002-CE dated 06.09.2002 & Notification No.6/2006-CE dated 01.03.2006 for the clearance of finished goods i.e. MS Specials to the water supply projects without payment of Central Excise Duty? – sub section (3) & (5) respectively of Section 35G of the Central Excise Act, 1944.
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Held that: – the Tribunal has rightly observed that t is not the case of the Department that MS Special were supplied somewhere other than projects in hand. The MS Special are connected with the water pipes before they are used, sometimes as a bend to divert the flow. When the MS Specials were used in the project pertaining to the water supply

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ld. CESTAT was right in law in setting aside the demand determined on the basis of non-fulfillment of the conditions of exemption Notification No.47/2002-CE dated 06.09.2002 & Notification No.6/2006-CE dated 01.03.2006 for the clearance of finished goods i.e. MS Specials to the water supply projects without payment of Central Excise Duty? (ii) Any other question of law as the Hon ble High Court may formulate and decide the same in terms of sub section (3) & (5) respectively of Section 35G of the Central Excise Act, 1944. 3. He has taken us through the contentions raised in the appeal memo which are reproduced as under: S.No. Chapter or heading or subheading or tariff item of the First Schedule Description of excisable goods Rate Condition No. 1 2 3 4 5 7 84 or any other Chapter The Following goods, namely:- (1) All items of machinery, including instruments, apparatus and appliances, auxiliary equipment and their components/parts required for setting up of water treatment plant

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No. 47A of Notification No.47/2002-CE dated 06.09.2002 is extracted hereunder under:- 47A. If, a certificate issued by the Collector/District Magistrate/Deputy Commissioner of the District in which the plant is located, is produced to the Deputy Commissioner of Central Excise or the Assistant Commissioner of Central Excise, as the case may be, having jurisdiction, to the effect that such goods are cleared for the intended use specified in column(3) of the Table. 4. He further contended that in view of Chapter 73 article of iron or steel where the assessee has claimed as under:- Tariff Item Description of goods Unit Rate of duty 1 2 3 4 7303 Tubes, Pipes and Hollow Profiles, or Cast Iron. 7303 00 Tubes, Pipes and Hollow profiles, of cast iron: 7303 00 10 Rain water pipe Kg. 12.5% 7303 00 20 Soil pipe Kg. 12.5% 7303 00 30 Spun pipe Kg. 12.5% 7303 00 90 Other Kg. 12.5% 5. Further, according to the Department the entry is as under:- Tariff Item Description of goods Unit Rate of duty 1 2 3

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entral Excise Tariff Act, 1985 (in short 'the Tariff Act'). The proviso makes it clear that where goods are chargeable to nil rate of duty or where the exemption from the whole of the duty of excise leviable is granted on any of the six categories enumerated, the manufacturer is required to make a declaration and give an undertaking, as specified in the Form annexed while claiming exemption for the first time under this Notification and thereafter before the 15th day of April of each financial year. As found by the forums below, including CEGAT, factually, the declaration and the undertaking were not submitted by the appellants. This is not an empty formality. It is the foundation for availing the benefits under the Notification. It cannot be said that they are mere procedural requirements, with no consequences attached for non-observance. The consequences are denial of benefits under the Notification. For availing benefits under an exemption Notification, the conditions have t

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name of product I.e MS Specials. On going through the said notification, it is observed that the said notification provides full exemption to the Pipes covered in any of the chapter needed for delivery of water from its source to the plant and from there to the storage facility subject to the condition No.4 that a certificate issued by the Collector/District Magistrate/Deputy Commissioner of the District in which the plant is located is produced to the Dy./Assistant Commissioner of Central Excise, having jurisdiction over the factory of the effect atha such goods are cleared for the intended use as specified in the Notification. In this case the adjudicating authority has observed that the appellants have cleared MS Specials without payment of duty and no certificate to the effect that such goods were cleared for the intended use as specified in the Notification have been submitted. Under the impugned order the adjudicating authority has observed as under: I, on perusal of the certifi

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see which were recorded on the spot wherein he had interalia stated that PSCC Pipes and MS Pipe are for different use and used in different zones of pressure and site condition and MS Specials are used for changing the alignment using for Tee, Bends and are short in length used for ling and jointing of Pipes in required alignment. However, he submitted the details of clearance of MS Specials during April 2006 to March 2008 ut could not give a proper reply for the said clearances of MS Specials without payment of duty and without having proper exemption certificate in this respect. I also find that the statement of Shri Anil Kedia, Accounts Officer, authorized by the director of the company is also co-related in this respect who tendered the statement that they were simultaneously clearing PSCC Pipes, BWSC Pipes, MS Pipes and MS Specials under various certificates issued by the Collector under exemption Notification No.47/2002-CE dated 06.09.2002 and 06/2006-CE dated 01.03.2006 substant

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ry to the facts mentioned in the impugned order except that MS Pipes and MS Specials are one and same things. Therefore, there is no point to interfere in the impugned order. Moreover, the appellants during the course of personal hearing stated that the certificates in respect of clearances of MS Specials shall be provided within one month but after expiry of more than 3 month, the same has not been submitted. Further, it is observed from the statement of Shri Ramesh Chandra Sahu, Authorized Signatory of the assessee wherein he stated that PSCC Pipes and MS Pipe are for different use and used in different zones of pressure and site condition and MS Specials are used for changing the alignment using for Tee, Bends and are short in length used for lying and jointing of Pipes in required alignment. Further, the Pipes are cleared in running length whereas the MS Specials were cleared in Nos. and Kgs which clearly indicated that both the products are different and their uses are also differ

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t Collector s Certificate would also cover MS Special. On going through the record, we find that out of the 8 certificates in 4 certificates MS Special has been mentioned. The Department has already granted exemption. When the exemption has been granted in 4 certificates it can be granted in the remaining 4 certificates also. It is not the case of the Department that MS Special were supplied somewhere other than projects in hand. The MS Special are connected with the water pipes before they are used, sometimes as a bend to divert the flow. When the MS Specials were used in the project pertaining to the water supply then the same is allowable as Department has already allowed in 4 certificates. Hence, for technical mistake on the part of the appellant, we cannot deny the substantial justice. 10. In our considered opinion, the production is the same, manufacturing and the process is the same and excise duty is liable on the manufacturing, merely because in the certificate there is no men

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GST – States – No. F.IV/Misc/HR/GST/27/2015-16/Partfile/2661-2668 – Dated:- 13-3-2018 – GOVERNMENT OF NCT OF DELHI DEPARTMENT OF TRADE & TAXES (HUMAN RESOURCE BRANCH) VYAPAR BHAWAN. IP ESTATE NEW DELHI No. F.IV/Misc/HR/GST/27/2015-16/Partfile/2661-2668 Dated: 13/03/2018 Authorization of officers under Section 67(11) of DGST Act. 2017 In exercise of the powers conferred upon me by clause (91) of Section 2 of the Delhi Goods & Services Tax Act, 2017 (hereinafter referred to as the Act) an

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2018 (6) TMI 115 – CESTAT MUMBAI – TMI – Penalty u/r 15(2) read with Section 11AC of the CEA 1944 – reversal of CENVAT Credit of various input services which were considered as ineligible to be availed – whether the first appellate authority was correct in setting aside the penalty imposed by the adjudicating authority on the respondent herein? – Held that:- It is undisputed that the respondent-assessee has paid all the demand with interest before the issuance of SCN on being pointed out by Revenue authorities. It is also undisputed that the records of the respondent-assessee’s were audited by the audit party regularly during the period in question – if the respondent-assessee discharged the demands as pointed out by the authorities during verification of the records with interest, provisions of section 11A(2B) would get attracted and SCN should not have been issued to respondent-assessee.
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The first appellate authority was correct in setting aside the penalty imposed and the im

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During the course of proceeding, the respondent herein reversed the entire CENVAT Credit on such services along with interest. Adjudicating authority in the adjudication confirmed the demand raised with interest, appropriated the amount and also imposed penalties by invoking provision of Rule 15(2) read with Section 11AC of the Central Excise Act, 1944, as applicable during the relevant period. On an appeal filed by the respondent, the first appellate authority upheld the confirmation of demand along with interest and set aside the penalties imposed. For setting aside the penalties, the first appellate authority has recorded that there is intention to evade duty, as the records of the respondent were audited by the audit party during the relevant period in question i.e. March, 2012 to December, 2012. 5. Learned D.R. would draw my attention to the facts of the case. He would submit that the demands have been raised on the assessee-respondent by invoking extended period which would mean

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s were audited by the audit party regularly during the period in question. 6.1 In my considered view, if the respondent-assessee discharged the demands as pointed out by the authorities during verification of the records with interest, provisions of section 11A(2B) would get attracted and show-cause notice should not have been issued to respondent-assessee. This provision of law was not considered by the adjudicating authority while imposing equal amount of penalty but first appellate authority correctly appreciated the law and set aside the penalty. 6.2 As regards the point raised by learned D.R., I find that the first appellate authority was correct in coming to a conclusion that the records of the respondent-assessee being audited by the authority during the period in question, there cannot be any allegation of suppression of the fact with intention to evade, evenon the discharge of duty liability along with interest. If respondent-assessee would have contested the demand on limita

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GST CUSTOMS RELATED WORK- Change in jurisdictional authority to handle work relating to Customs Acceptance of B-17 Bond/ EOUs, Duty free import at concessional rate, etc-Customs Notification No.03/2018-Customs (N.T.) dated 10.01.2018 – Formalization functioning of Export Promotion Division (EPD) – Customs – 18/2018 – Dated:- 13-3-2018 – GOVERNMENT OF INDIA MINISTRY OF FINANCE, DEPARTMENT OF REVENUE OFFICE OF THE COMMISSIONER OF CUSTOMS, CHENNAI – IV RAJAJI SALAI, CUSTOM, HOUSE, CHENNAI – 600001 TELEPHONE : 2525 4551 – FAX : 044-25221861 www.chennaicustoms.gov.in Emai1 : commr4-cuschn@nic.in (IS 15700:2005 (Sevottam) Certified) F.No.S.Misc.01/ 2018-EPD (CH- IV) Dated: 13.03.2018 PUBLIC NOTICE NO: 18/2018 Sub: GST CUSTOMS RELATED WORK- Change in jurisdictional authority to handle work relating to Customs Acceptance of B-17 Bond/ EOUs, Duty free import at concessional rate, etc-Customs Notification No.03/2018-Customs (N.T.) dated 10.01.2018 – Formalization functioning of Export Promotion

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on Territory of Puducherry, which.were hitherto handled, by the Central Excise Officers. 3. In view of the subsequent clarifications, of the Special Secretary & Member (Export Promotion), CBEC, New Delhi conveyed vide letter D.O.F. No. 450/ 17 / 2017 -Cus. IV dated 06.02.2018 the acceptance of LUT have to be attended by the concerned officers of Central Excise / GST Divisions. 4. Revised and non-exhaustive list of Work to be attended by the Export Promotion Division (EPD) related to EOUs, SEZs/STPs/EHTPs etc., and certain other assignments relating to Export promotion pertaining to the Chennai Customs Zone are furnished hereunder for the information of all concerned: a) Customs functions hitherto performed by erstwhile Central Excise/GST formations pertaining to EOU/SEZ/EHTP/STPI which are within the territorial jurisdiction of Chennai Customs Zone., b) Factory stuffing of containers for export of LCL cargo, c) Duty free import by EOU/EHTP/STP units, issuance of re-warehousing cert

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PCG) scheme; g) Recovery of dues under section 142 of the Customs Act, 1962 h) Adjudication of offences and demand of Customs duty in respect of SEZs by the Central Excise Officers having jurisdiction over the SEZ. i) Any other functions relating to Export Promotions hitherto performed by the Central Excise /GST Authorities within the territorial jurisdiction of Chennai Customs Zone 6. This Public Notice is being issued so as to inform the trade and field formations about the functioning of the EPD with the list of specific work to be handled by it and as to the statutory provisions governing the above. The respective circulars/instructions may please be referred to in the CBEC's website www.cbec.gov.in and www.chennaicustoms.gov.in for more information. 7. The Trade & Industry Associations/Chambers of Commerce are requested to bring the contents of this P. N to the notice of all their members. 8. Difficulties, if any faced in the functioning of the Export Promotion Division as

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Customs – Sub: Mandatory declaration of GSTIN, IEC and email address of importer in the Bills of Lading obtained by shipper: reg. – Trade Notice – TMI Updates – Highlights

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Goods and Services Tax – Started By: – nandankumar roy – Dated:- 12-3-2018 Last Replied Date:- 14-3-2018 – DEAR SIR,WE HAVE SUPPLIED MEDICINE RITES(CENTRAL GOVT LIFE SAVING DRUGS PROVIDER ENTITY) WHICH IS UNDER CENTRAL GOVT UNREGISTERED CLIENT IN THE MONTH OF AUG. PLACE OF PARTY ADDRESS BELONGS TO HARYANA .ACCORDINGLY WE HAVE RETURN FILED OF 3B AND GSTR1 IN B2CS SECTION AS STATE HARYANA BUT WHEN WE ARE DEMANDING PAYMENT THEY ASKING FOR ALL BILL TO BE CHANGE IN RITES DELHI ADRRESS ON SAME ALL INVOICES. PL TELL IF WE CHANGE ALL EARLIER HARYANA BILL IN NOW DELHI ADDRESS AND IF DO ANY PROBLEM ARISE TO US IN FUTURE . SUPPOSE WE PUT THESE MATTER TO GOVT GREVIENCE FOR THIS CHANGES OF STATE) PL PROVIDE SOLUTION TO GET THE PAYMENT FROM THEM WHICH I

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Goods and Services Tax – Started By: – SAFETAB LIFESCIENCE – Dated:- 12-3-2018 Last Replied Date:- 12-3-2018 – Dear Experts, We are giving post- sales Trade Discount to our customers. The GST rate is for our final products is 12% . The customer receiving Trade Discount is instructing us to put GST 18% on Discount value and we have given Credit Note with 18% GST several times. We have reduced the Trade Discount Credit Note value in Taxable Sale Value and reduced the 18% GST value from the GST payable in GSTR-3B. Please confirm the GST rate on Discount 18 % is correct or not. Our GST officials are telling it is wrong and we have to put GST only 12%. Please clarify with documentary evidences / notification / GO details like that since our cus

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ot mentioned on the face of the invoice can be reduced from the taxable value, if following conditions are satisfied: i) Discount is established in terms of an agreement before supply. In simple words, both supplier and recipient are aware and have agreed about the discount before the supply. ii) Discount is linked to a specific supply invoice. iii) ITC attributable to the discount is required to be reversed by the buyer or recipient of the supply. Satisfying the above conditions, if the Post Sales Trade discount can be linked to the specific supply invoice then the GST applicable on the Credit note raised would be @ 12% and not 18%. GSTR 1 should mention the credit note details Invoice-wise such that equivalent Input Tax credit is passed o

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met, namely – (a) discount is established in terms of a pre supply agreement between the supplier & the recipient and such discount is linked to relevant invoices and (b) input tax credit attributable to the discounts is reversed by the recipient. Further, Section 34 of the CGST Act, 2017 provides for issuance of credit notes for post supply discounts within a stipulated time. When such credit notes are issued, obviously it would call for reduction in output liability of the supplier. Hence, the taxes paid initially on the supply would be higher than what is actually payable. In such a scenario the excess tax paid by the supplier needs to be refunded. However, instead of refunding it outright, it is sought to be adjusted after verifyin

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Goods and Services Tax – GST – By: – Anuj Bansal – Dated:- 12-3-2018 Last Replied Date:- 28-5-2018 – An Input service distributor (ISD) is an office of supplier of goods or services which receives tax invoices for services and distributes the credit in such invoices to its branches having the same PAN in the manner prescribed under the law. However, in order to distribute credit, following conditions are required to be followed: The credit can be distributed to the recipients of credit against a document containing the details as may be prescribed. The amount of credit distributed shall not exceed the amount of credit available for distribution. The input tax credit available for distribution in a month shall be distributed in the same month. E.G. Input Tax Credit for the month of July shall be distributed in the same month i.e. in the month of July only. Procedure for distribution of credit: The procedure for distribution of credit is given in Section 20 read with Rule 39. As per the

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ced by the amount of any duty or tax levied. relevant period – means – If the recipients of credit have turnover in their states during the FY preceding to the current FY, the Preceding FY; or If some or all recipients do not have any turnover in their States in the FY preceding the year during which the credit is to be distributed, relevant period will be the last quarter for which details of such turnover of all the recipients are available, previous to the month during which credit is to be distributed. Therefore, if all the recipients have turnover in the previous year, then turnover for the previous year shall be considered for purpose of calculating the ratio. However, in a situation, if all the recipient were not having turnover in the previous year, then turnover of the last quarter (in which all recipients having turnover) preceding the month of return shall be considered for computing the ratio E.g. the return for Jan, 2018 is to be filed and all the recipients were neither h

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anner: Location of Branch (recipient of ITC) Manner of Distribution of Credit Same state as that of ISD The credit of IGST, CGST, SGST or UTGST shall be distributed as IGST, CGST, SGST or UTGST respectively. Different state as that of ISD The credit of IGST, CGST, SGST or UTGST shall be distributed as IGST. Input Service Distributor Invoice / Credit Note for the distribution of credit: The document prescribed for distribution of credit is Input Service Distributor Invoice . Moreover, the details required in the invoice are also prescribed in the same Rule. An Input Service Distributor Invoice / Credit Note shall be issued to the recipient for distributing the credit and same shall be reported in the ISD Return. Following are the details required to be mentioned on the invoice: Name, Address and GSTIN of the ISD. Consecutive serial number not exceeding sixteen characters, in one or multiple series, containing alphabets or numerals or special characters-hyphen or dash and slash symbolise

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to the output liability of recipient. Services taken under RCM The ISD is not permitted to make payment of tax under RCM. Therefore, in a situation where the ISD is taking services which are taxable under RCM, it is suggested that either take a normal registration and take services in such registration and pass on the credit to ISD by raising an invoice on ISD. The other option is that the company can take such services in other existing normal registration and pass it on to ISD. Thereafter, the ISD can distribute the credits to the concerned units. GST Retuns: An ISD is required to file monthly return in GSTR-6 within 13 days after the end of the month and will have to furnish information of all ISD invoices issued. The monthly return can be prepared after adding, correcting or deleting the details on the basis of details of credit available on the GST portal in GSTR – 6A. The details in the returns will be made available to the respective recipients in their GSTR 2A. The recipients

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re as follows: – Unit Turnover (Rs.) Total Turnover of three units = ₹ 10,00,00,000 Turnover of Delhi unit = ₹ 5,00,00,000 (50%) Turnover of Gurgaon unit = ₹ 3,00,00,000 (30%) Turnover of Mumbai unit = ₹ 2,00,00,000 (20%) Now credit shall be distributed as follows: (Figures in Rs.) Particulars Total Delhi Gurgaon Mumbai Turnover of units in PY 2016-17 10,00,00,000 5,00,00,000 3,00,00,000 2,00,00,000 GST paid on services used only for Delhi Unit. 5,00,000 5,00,000 IGST, CGST & SGST paid on services used in all units: Distribution on pro rata basis to all the units which are operational in the current year 20,00,000 10,00,000 6,00,000 4,00,000 Note: Credit distributed on pro rata basis on the basis of the turnover of all the units is as under: – (a) Unit Delhi: (5,00,00,000/10,00,00,000) *20,00,000 = ₹ 10,00,000 (b) Unit Gurgaon: (3,00,00,000/100000000) *20,00,000 = ₹ 6,00,000 (c) Unit Mumbai: (2,00,00,000/100000000) *20,00,000 = ₹ 4,00,000

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0,000 GST paid on services used only for Delhi Unit. 5,00,000 5,00,000 IGST, CGST & SGST paid on services used in all units: Distribution on pro rata basis to all the units which are operational in the current year 20,00,000 8,00,000 5,00,000 7,00,000 On the basis of above, it would have been observed that compliances under ISD requires great efforts like maintaining credits, mismatching of credits, distributing credit, issuing Input Services Distributor Invoices, etc. Moreover, the determination of ratios for distribution is also a cumbersome process. Though it s a legacy brought forward from erstwhile law but no attempt has been made to simplify the process. Even after going through the provisions, the following questions are unanswered: Credit is to be distributed to the units which are operational in the current year. The meaning of operational is not provided under the law. The question is, if the unit is registered but not engaged in any supply activity, whether the credit i

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ai, Mumbai, Kolkata, Pune & Delhi. The rent is being paid by the company to un-registered landlords. Should we discharge RCM for such rent paid by the company ? if so, whether the GST paid under RCM can be taken credit in Karnataka ?Mahesh. M – Reply By Ganeshan Kalyani – The Reply = presently there is no tax under reverse charge on inward supply of goods or services from an unregistered dealer. hence you are not liable to pay gst as a recipient accordingly no question of distribution of tax paid. – Reply By RAVINDER GAMBHIR – The Reply = Dear Sir,Is it mandatory to take ISD registration. To be specific-a pvt ltd company is having Regd/Head office in Delhi,registered in GST, and having Branch in Haryana(GST registered).- Both the offices are making taxable supplies- Can the Registered Office take credit(full) of Rent, Audit fees etc. OR it will have to take ISD registration in Delhi and transfer credit proportionately Ravinder Kumar – Reply By balaji aa – The Reply = Dear Sir/Madam

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Customs – 38/2018 – Dated:- 12-3-2018 – OFFICE OF THE COMMISSIONER OF CUSTOMS (NHAVA SHEVA-I) JAWAHARLAL NEHRU CUSTOM HOUSE, NHAVA SHEVA, URAN, RAIGAD, MAHARASHTRA – 400 707 FAX: 022-27243245 e-mail: edi@jawaharcustoms.gov.in F. No. EDI/ Misc.-82/2015/JNCH Date: 12.03.2018 PUBLIC NOTICE NO. 38/2018 Sub: IGST Refund not disbursed due to PFMS error – reg. It has come to notice that after generation of IGST Refund Scroll through ICES, in some cases the IGST Refund could not be disbursed due to IFSC not being accepted by PFMS/not registered at PFMS. 2. The list of such IEC holders whose IGST Refund has not been disbursed due to PFMS error is being uploaded on the JNCH website (www.jawaharcustoms.gov.in) regularly. 3. IEC holders can check the

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s.gov.in) for updation of their IFSC account: In case of Fresh Registration/Changes: (i) Request letter to DC/EDI for registration of IFSC. (ii) Account details verified by concerned bank on exporter s letterhead. (iii) IEC copy. (iv) PAN copy. In case of cancellation of earlier account and registration of a new one: (i) All the above documents. (ii) NOC from Exporter. (iii) NOC from Bank. Sd/- (M.R. MOHANTY) Commissioner of Customs (NS-I), J.N. Custom House, Nhava Sheva. ERRORS IN PFMS VALIDATION AND THEIR RECTIFICATION S.No. Error Code Error Description Rectification 1 TBE0001 Error in reading file, File is malformed or Failed during scheme validation. Not Applicable 2 TBE0002 Mandatory Tags values are missing in the Header Part. Not Appl

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9 TBE0009 Bank Name is not as per PFMS Bank Master. Not applicable – May occur only with other error. 10 TBE0010 Bank Account details have not been provided. Check the Account Number for correctness – Submit correct details. 11 TBE0011 Mobile Number should be of 10 digits only. Not Applicable. 12 TBE0012 Invalid Value for Location Code Inform DG systems for rectification 13 TBE0013 Invalid Value for Division Code Inform DG systems for rectification 14 TBE0014 Invalid value for Purpose, It should be A/U/D. Not Applicable. 15 TBE0015 Invalid IFSC Code. Check the IFSC Code for correctness – Submit correct details 16 TBE0016 Rejected by Bank, Account No. does not exist in Bank. Check the Account Number for correctness -Submit correct details 17

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2018 (3) TMI 1390 – TELANGANA & ANDHRA PRADESH HIGH COURT – TMI – Jurisdiction of Court – requirement of fulfillment of Bank Guarantee – petitioners collected the service tax from the service recipients and did not pay the same to the credit of the Central Government. – Bail conditions – The condition, that the petitioners shall furnish bank guarantee for the remaining due amount, within ten days from the date of order of the Court below, imposed, while granting bail to the petitioners, is what is brought into question in the present criminal petitions.
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Held that: – The Court, on the basis of the undertaking given by a party, cannot convert itself into an executing Court to execute the terms agreed by the party, while deciding the bail application – the condition imposed by the Court below to the extent of directing the petitioners to furnish bank guarantee for the remaining amount cannot be sustained and is set aside.
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Petition allowed – decided in favor of petitioner. – C

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the said services, which are liable to service tax. Information was received by DGGSTI, Hyderabad, which suggested that the petitioners collected the service tax from the service recipients and did not pay the same to the credit of the Central Government. Accordingly, investigation was initiated against the petitioners. The scrutiny of the documents, recovered from the petitioners, revealed that the petitioners received consideration, along with service tax thereon, from the service recipients, during the period October 2012 to March 2017. The petitioners collected service tax to a tune of ₹ 4,05,77,984/- and ₹ 2,16,89,832/- respectively from different service recipients but did not pay the same to the credit of the Central Government. Party verification was also done, which indicated that service consideration was paid by the recipients, inclusive of service tax. Hence, the petitioners were held liable for the offence under Section 89 of the Finance Act, 1994 (for short t

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g in excess of the amount specified in the notice. 7. The counsel for the petitioners contends, that the aforesaid conditions were not fulfilled by the prosecution and unless those conditions are fulfilled, the due time for payment of the tax does not arise and hence, the payment does not become due, in order to invoke Section 89 of the Act. 8. The Special Public Prosecutor does not refute the submission of the counsel for the petitioners, that no such notice was served. The Special Public Prosecutor filed a counter affidavit contending, firstly, that the time given for furnishing the bank guarantee has expired by the date of the petitioners approaching this Court and secondly, the petitioners showed the schedule of payment, in the memo dated 14.02.2018, submitted to the Special Court for Trial of Economic Offences. The petitioners were asked to offer their comments and the petitioners appended their signatures on the same along with date, as a token of having seen the memo; the conten

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ion that the order granting bail has become invalid, as, the time permitted for furnishing bank guarantee has expired, it can be said that the said contention is not correct. The time given was ten days from the date of order. The order was passed on 16.02.2018 and the petition was filed on 22.02.2018 and the order was stayed on 26.02.2018. 10. With regard to the undertaking that was given by the petitioners, allegedly, the counsel for the petitioners submits that the undertaking, which is given by their counsel and not the petitioners, does not bind the petitioners. In that regard, he relies on a decision of the Supreme Court in HIMALAYAN COOP. GROUP HOUSIGN SOCIETY v. BALWAN SINGH (2015) 7 SCC 373 wherein it was held that, for lawyers are perceived to be agents of their clients, the law of agency does not apply strictly to client-lawyer relationship; since lawyers also stand in a fiduciary relationship to their clients; their duties are more demanding than those imposed on other agen

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is contention that the undertaking given by the counsel cannot bind his clients i.e. petitioners herein. 11. The scheme of the provisions of the Act was explained by the Delhi High Court in two of its decisions i.e. eBIZ.COM PVT. LTD v. UNION OF INDIA (para 79) 2016 (44) S.T.R. 526 (DEL.) and MAKEMYTRIP (INDIA) PVT. LTD. v. UNION OF INDIA (para 116) 2016 (44) S.T.R. 481 (DEL.) and the relevant portion of para 79 is as under: 79. To summarise the conclusions in this judgment: (i) The scheme of the provisions of the Finance Act 1994 (FA), does not permit the DGCEI or for that matter the Service Tax Department (ST Department) to by-pass the procedure as set out in Section 73A (3) and (4) of the FA before going ahead with the arrest of a person under Sections 90 and 91 of the FA. The power of arrest is to be used with great circumspection and not casually. It is not to be straightway presumed by the DGCEI, without following the procedure under Section 73A (3) and (4) of the FA, that a pers

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wered and authorised in that behalf to be satisfied that a person has committed an offence under Section 89 (1) (d) of the FA, it would require an enquiry to be conducted by giving an opportunity to the person sought to be arrested to explain the materials and circumstances gathered against such person, which according to the officer points to the commission of an offence. Specific to Section 89 (1) (d) of the FA, it has to be determined with some degree of certainty that a person has collected service tax but has failed to pay the amount so collected to the Central Government beyond the period of six months from the date on which such payment is due, and further that the amount exceeds ₹ 50 lakhs (now enhanced to ₹ 1 crore) The Court observed that, in the case with which it was dealing, the SCN was not even issued and determination of the service tax arrears was not made and in those circumstances, resorting to extreme coercive measure of arrest followed by detention of th

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hat they have no fundamental right to construct hutments on pavements and that they will not object to their demolition after October 15, 1981, they are entitled to assert that any such action on the part of public authorities will in violation of their fundamental rights. The Supreme Court was dealing with a case of pavement dwellers where the dwellers gave an undertaking to vacate the footpaths and that undertaking was brought against the footpath dwellers therein and while appreciating the violation of such undertaking, the Supreme Court held as above. It further held that there can be no estoppel against the Constitution; the Constitution is not only the paramount law of the land but it is the source and sustenance of all laws; the doctrine of estoppel is based on the principle that consistency in word and action imparts certainty and honesty to human affairs; if a person makes a representation to another, on the faith of which the latter acts to his prejudice, the former cannot re

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personal freedoms on promise of transitory, immediate benefits. 13. In support of his contention that it is not only estoppel against Constitution that is held to be invalid but also against any Statute, the counsel for the petitioners takes support of the decision of the Supreme Court in STATE OF UTTAR PRADESH v. UTTAR PRADESH RAJYA KHANIJ VIKAS NIGAM SANGHARSH SAMITI (2008) 12 SCC 675 wherein it was held that from the record it appears that it was the case of the Secretary of the Corporation that no such assertion was given by him to the Court; but even if he had given such assertion it was of no consequence since in the teeth of the Statutory rules, such assertion had no legal efficacy. 14. In the light of the above legal position, the decision of the High Court of Chhattisgarh in Miscellaneous Criminal Case No.4980 of 2013 dated 22.11.2013, on which the Special Public Prosecutor relies upon, cannot be followed. In the said case, the Court relied on the undertaking given by a party

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2018 (4) TMI 579 – KERALA HIGH COURT – [2018] 2 GSTL 117 (Ker) – Detention of goods – it was alleged that the goods were being transported without the requisite documents – Section 129 of the CGST Act as also the Kerala SGST Act – the requisite documents were subsequently furnished – Held that: – the writ petition disposed off directing the second respondent to complete the adjudication provided for under Section 129 of the said statutes within seven days. – WP(C).No. 7877 of 2018 Dated:- 12-3-2018 – P. B. Suresh Kumar, J. For the Petitioner : Smt. K. Latha For the Respondent : Sri.V. K. Shamsudheen JUDGMENT Goods of the petitioner have been detained by the second respondent invoking the power under Section 129 of the Central Goods and Se

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Goods and Services Tax – Started By: – SUSHIL GOYAL – Dated:- 11-3-2018 Last Replied Date:- 22-3-2018 – GST @ 6% on GTA services is allowed to be paid on forward charge basis provided that the goods transportagency opting to pay central tax @ 6% under this entry shall, thenceforth, be liable to pay central tax @ 6% on all the services of GTA supplied by it. I have a query – Is a person registered under two States can opt for paying GST on GTA Services on reverse charge basis, if it has opted for payment of tax on forward charge basis in one State? – Reply By Rajagopalan Ranganathan – The Reply = Sir,In my opinion if GTA pays 6% gst from one state then he has to follow the same procedure in respect of his unit in other state. He cannot pay

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eply = But relevant notification refers to Goods Transport Agency, which is defined as a person engaged in such rendering service. A person has been defined in CGST Act, 2017 as a Company, Firm, etc. No is no mention of Registered Person in the said provisions. A registered person is defined in CGST Act, 2017 as a person registered is a State. Therefore, in my view also a person being a Company or a firm can not opt for paying tax on reverse charge basis in a State, if it opts for paying tax on forward charge basis is another state. However, this view is subject to discussion and therefore further views are invited on this issue. – Reply By rajkumar shukla – The Reply = I have already shared my views on this. Let others come forward. Paymen

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Goods and Services Tax – Recommendationsregarding Data Analytics made during the 26th meeting of the GST Council – TMI Updates – Highlights

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Goods and Services Tax – Recommendations regarding E-way Bill made during meeting of the GST Council – TMI Updates – Highlights

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Goods and Services Tax – 26th Meeting of the GST Council meets & decides Extension of tax exemptions for exporters for six months – TMI Updates – Highlights

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Goods and Services Tax – Recommendations made during the 26th meeting of the GST Council held in New Delhi Today – TMI Updates – Highlights

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Recommendations regarding E-way Bill made during meeting of the GST Council – Goods and Services Tax – GST – Dated:- 10-3-2018 – E-way Rules In the 26th meeting held here today , the GST Council has recommended the introduction of e-way bill for inter-State movement of goods across the country from 01st April 2018. For intra-State movement of goods, e-way bill system will be introduced w.e.f. a date to be announced in a phased manner but not later than 01st June, 2018. Major improvements over the last set of rules, as approved by the Council now, are as follows: E-way bill is required to be generated only where the value of the consignment exceeds ₹ 50000/-. For smaller value consignments, no e-way bill is required. The provisions of

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ilways will not deliver the goods to the recipient. But railways are required to carry invoice or delivery challan etc. Time period for the recipient to communicate his acceptance or rejection of the consignment would be the validity period of the concerned e-way bill or 72 hours,whichever is earlier. In case of movement of goods on account of job-work, the registered job worker can also generate e-way bill. Consignor can authorize the transporter, courier agency and e-commerce operator to fill PART-A of e-way bill on his behalf. Movement of goods from the place of consignor to the place of transporter up to a distance of 50 Km [increased from 10 km] does not require filling of PART-B of e-way bill.They have to generate PART-A of e-way bill

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Goods and Services Tax – GST – Dated:- 10-3-2018 – In the 26th meeting held here today , the GST Council has been apprised of the fact that CBEC and GSTN have started detailed data analytics across a number of data sets available with them. The outcome of preliminary data analysis has revealed interesting insights: It has emerged that there is variance between the amount of IGST & Compensation Cess paid by importers at Customs ports and input tax credit of the same claimed in GSTR-3B. There

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Goods and Services Tax – GST – Dated:- 10-3-2018 – I. Return filing System The present system of filing of GSTR 3B and GSTR 1 is extended for another three months i.e., April to June, 2018 till the new return system is finalized. A new model was discussed extensively and Group of Ministers on IT has been tasked to finalize the same. II. Reverse charge mechanism The liability to pay tax on reverse charge basishas been deferred till 30.06.2018. In the meantime, a Group of Ministers will look into

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Goods and Services Tax – GST – Dated:- 10-3-2018 – Sending a strong positive signal to the exporting community, the GST Council in its 26thmeeting held here today decided to extend the available tax exemptions on imported goods for a further 6 months beyond 31.03.2018. Thus, exporters presently availing various export promotion schemes can now continue to avail such exemptions on their imports upto 01.10.2018, by which time an e-Wallet scheme is expected to be in place to continue the benefits in future. In a related development which would benefit the exporters, the Council reviewed the progress in grant of refunds to exports of both IGST and Input Tax Credit. The Council appreciated that the pace of grant of IGST refund has picked up. Th

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zation, EPCG and EOU schemes were recognized as 'deemed exports' with flexibility foreither the suppliers or the exporters being able to claim a refund of GST / IGST paid thereon. All these avenues were made available upto 31.03.2018. The permanent solution agreed to by the Council was to introduce an e-Wallet scheme w.e.f. 01.04.2018. The e-Wallet scheme is basically the creation of electronic e-Wallets, which would be credited with notional or virtual currency by the DGFT. This notional / virtual currency would be used by the exporters to make the payment of GST / IGST on the goods imported / procured by them so their funds are not blocked. On 16.12.2017, Finance Secretary constituted a Working Group with representatives of Centra

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Goods and Services Tax – GST – By: – CA Venkata prasad Pasupuleti – Dated:- 10-3-2018 – Education Cess was being levied on Central Excise and Service Tax from 10.09.2014. Education Cess paid on the purchase was available as a credit against payment of education cess on payment on the output removal. The credit of cess was not able to use for the payment of duty. Later when the rate of excise duty was increased from 12% to 12.5%, cess was rescinded. Thereby the accumulated credit was not able to be used. Similar was in case of Krishi Kalyan Cess credit in case of service tax. Now whether this accumulated credit of cess can be carried forward into the GST under the transition provision is the issue, there were contradicting views on this some in favor and some against. Few of them have carried forward the credit, however recently, there were news articles published in the newspapers that companies carried forwarded the credit of KKC may face fine/penalties citing that the recent judgmen

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o do with the unutilized credit of EC/SHEC lying as on 01.03.2015/01.06.2015 whether it lapses or can be sought as a refund or used for the payment of tax/duty? A writ petition has been filed inter alia seeking direction that the credit accumulated as on 01st June 2015 on account of EC and SHEC should be allowed to be utilised for payment of service tax. Contentions: The petitioners claim a vested right to avail benefit of the unutilized amount of EC or SHE credit, which was available and had not been set off as on 1st March 2015 and 1st June 2015 for payment of tax on excisable goods and taxable services respectively. The contention was that EC and SHE were subsumed in the Central Excise Duty, the general rate of which was increased from 12% to 12.5%, and service tax, which was increased from 12.36% to 14%. Reliance is placed upon the Budget Speech of the Finance Minister and the memorandum explaining provisions of Finance Bill, 2015. Reference is also made to the TRU letter F.No.334/

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e 14 was not offended. Further, the Hon ble High Court held that there is no provision in the law which states that EC and SHEC are subsumed into Service Tax and Excise Duty to allow the cross-utilisation of credit. Thereby decision concluded that the credit of EC and SHEC cannot be used for the payment of excise duty. Implications on the Credit carried forwarded into GST: The decision of the Hon ble High court restricted to the subject of cross-utilisation of EC and SHEC against the payment of Central Excise or Service Tax. This judgment nowhere discusses the eligibility of CENVAT Credit of EC and SHEC and the same lapsing. Therefore it is of no dispute that the credit was eligible and did not lapse. Section 140 of CGST Act, 2017 entitles a registered person to carry forward the closing balance of CENVAT Credit in the last return filed under the existing law. CENVAT Credit has been defined in the explanation to section 142 giving the meaning assigned to it under Central Excise Act or

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ut has not discussed the first part i.e, CENVATABILITY of Cess which is essential to determine whether such credits can be carried forward to GST or not. As Cess passed the first criteria, the credit of the same can be carried forward to GST. As the issue decided by the Delhi High Court is related to cross-utilization of EC, SHEC which does not have any impact on CENVATABILITY of the cesses, the said decision does not have any impact on the credit carried forwarded into GST. Further, while giving the above judgment High Court has observed that there is no specific provision in existing laws stating that EC and SHEC are subsumed in Service Tax and Excise Duty. While introducing GST, Central Government has amended the Constitution of India by subsuming the Service tax and Excise Duty into GST and an article has been included requiring the GST Council to suggest the Cesses that should be subsumed into GST. The list of Cesses subsumed into GST also includes KKC and also there are exists re

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Goods and Services Tax – GST – By: – Dr. Sanjiv Agarwal – Dated:- 10-3-2018 – Meaning of Document The term document has been defined in section 2(41) of the CGST Act, 2017 to include: Written or printed Record of any sort and Electronic record as defined in the Information Technology Act, 2000 Meaning of Presumption The term presumption has not been defined under the GST Act. The dictionary meaning of this term is A conclusion made as to the existence or non existence of a fact That must be drawn from other evidence That is admitted and proven to be true. Thus, presumption can be understood as an inference of a fact drawn from another known fact. In certain cases, the documents produced or seized from a person can be denied of its truth, i

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evidence whether it is duly stamped or not, if such document is otherwise admissible It may be noted that this provision is rule of evidence and rebuttable presumption which can be proved by the accused that it is not genuine and should not be accepted as evidence. Admissibility of Micro Films, Facsimile Copies of Documents and Computer Printouts as Documents and as Evidence The term micro films has not been defined under the CGST Act. As per the free dictionary, it means a film on which printed materials are photographed at greatly reduced size for ease of storage. The phrase 'Facsimile Copies of Documents' has not been defined under the CGST Act, as per free dictionary, it means an exact copy of reproduction. The term Computer pri

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prescribed conditions or (d) Any information stored electronically on a device or a media, including any hard copies made of such information Certificate to be considered as evidence for proceedings under GST In any proceeding where it is desired to give a statement in evidence as provided in section 145(2) of the CGST Act, a certificate doing any of the following things shall be sufficient for a matter to be stated to the best of the knowledge and belief of the person stating it. (a) Identifying the document containing the statement and describing the manner in which it was produced (b) Giving particulars of any device involved in production of that document as may be sufficient to show that the document was produced by a computer. – Artic

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Goods and Services Tax – Started By: – raja raja – Dated:- 9-3-2018 Last Replied Date:- 13-3-2018 – Dear Experts ,Pl clarify GST applicability on gold loan interestThanks in advance – Reply By Rajagopalan Ranganathan – The Reply = Sir, Vide Sl. No.27 of Notification No. 12/2017-Central Tax (Rate) dated 28.6.2017 as amended rate of gst on Services by way of extending deposits, loans or advances in so far as the consideration is represented by way of interest or discount (other than interest invo

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Goods and Services Tax – Started By: – Narendra Soni – Dated:- 9-3-2018 Last Replied Date:- 10-3-2018 – Dear Expert, kindly suggest the meaning of below para of Rule 96, what is restriction for availing IGST paid refund from Customs ??? The persons claiming refund of integrated tax paid on exports of goods or services should not have received supplies on which the supplier has availed the benefit of the Government of India, Ministry of Finance, notification No. 48/2017-Central Tax dated the 18th October, 2017 published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i), vide number G.S.R 1305 (E) dated the 18th October, 2017 or notification No. 40/2017-Central Tax (Rate) 23rd October, 2017 published in the Gazette

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er, 2017.] – Reply By Alkesh Jani – The Reply = Sir, In simple words it can be said that the exporter shall not avail the benefits as per the Notifications cited by you otherwise the refund of IGST shall not be granted. The double benefit cannot be availed.At this juncture, I request the experts, that there is marginal benefits against, IGST. So my point of view is that refund should be granted after deducting the benefits availed, or else the taxes have been deemed to be exported out of India and is violation of International treaty. Please correct me if mistaken. – Reply By CS SANJAY MALHOTRA – The Reply = Refund of IGST paid on export of goods is not available to Exporter if his SUPPLIER (not exporter himself) supplies goods to exporter

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bject to the availment / non availment of benefit by supplier of goods against supplies to Exporter of goods. – Reply By Alkesh Jani – The Reply = Dear Sanjay Sir,Please comment on the second para of my first reply. I am very keen to know your views. – Reply By CS SANJAY MALHOTRA – The Reply = Dear Alkesh, First of all, the concept of refund claim is different alongwith the tax administration for processing of same, hence your view not acceptable from legal and administration perspective. Furthermore, no treaty is violated as no tax incidence is recovered from customers. Act allows Exporter to claim back tax suffered on Exports either by way of input refund under Rule 89 or by way of Refund of tax paid on Exports (Rule 96). – Discussion-For

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2018 (3) TMI 556 – ALLAHABAD HIGH COURT – 2018 (12) G. S. T. L. 286 (All.) – Business Auxiliary Services – appellants are franchisee/distributors appointed by the BSNL for sale of SIM cards – Held that: – the law is settled by the Hon'ble Apex Court in the case of Martend Food & Dehydrates Pvt. Ltd. [2013 (6) TMI 339 – CESTAT NEW DELHI], where it has been held that the activities of purchase and sale of SIM cards belonging to BSNL where BSNL has discharged the service tax on the full value of the SIM cards does not amount to providing business auxiliary service – appeal dismissed – decided against Revenue. – Central Excise Appeal No. 28 of 2018 Dated:- 9-3-2018 – Hon'ble Bharati Sapru And Hon'ble Harsh Kumar, JJ. For the Appellant : Piyush Agrawal ORDER Heard Sri Piyush Agrawal learned counsel for the appellant and Sri Subham Agrawal assisted by Ms.Sanyukta Singh learned counsel for the respondent assessee. This is department's appeal under section 35-G of the Central Exc

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art of the activation charges as no activation is possible without a valid functioning of SIM card and the value of the taxable service is calculated on the gross amount received by the operator from the subscribers and the present transactions to BSNL and payment by BSNL were different, whether the Hon'ble CESTAT was justified in dropping the demand of service tax? (d) Whether the Hon'ble CESTAT erred in treating it as double taxation when services are distinct? Service tax is paid on full value of SIM card by BSNL under the "Telecommunication Service" and not under "Business Auxiliary Service". In the instant case, service tax has been demanded from the respondent under the category of "Business Auxiliary Service" on the communication received from BSNL, which is entirely different from "Telecommunication Service"? (e) Whether the Hon'ble CESTAT has erred in not taking into account of its own case passed vide final order no.ST/A/684

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stributors appointed by the BSNL and as per documents on record during the material period they were engaged in purchase of SIM cards from M/s. BSNL and their respective sale to the buyers. The records show that they have not provided any service in relation to sale promotion of goods belonging to M/s. BSNL. As such the activities carried out by them cannot be treated as falling within the purview of 'Business Auxiliary Service'. Moreover M/s.BSNL have already discharged the burden of Service Tax on the gross amount of SIM cards and demand of service tax on the same amount from the appellants will only lead to double taxation which is not permissible under the law. Hence the demand of service tax as ordered vide impugned order in original is not sustainable. Further when the demand is not sustainable, penalties imposed are also not maintainable. Having heard learned counsel for the parties and having perused the material on record, we are of the view that in view of the law set

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