This Annual Case Digest analytically summarizes the key stories related to Tax judgements of various High Courts in India reported in Taxsca.in during the year 2023. These stories include judgements and observations of High Courts related to Income Tax, Goods and Service Tax(GST), Excise Duty, Service Tax, Customs Duty, etc.
A Division Bench of Bombay High Court has quashed the reassessment proceedings against Jetair. The impugned order was set aside observing that “we have no hesitation in holding that the reassessment proceedings were nothing but a case of ‘change of opinion’, which does not comply with the jurisdictional foundation under Section 147 of the Income Tax Act.
The Calcutta High Court (HC) in a significant case of New India Assurance Company, ordered to calculate compensation for accident claims on a Gross salary after deducting Professional tax.
The Madras High Court directed to accept Personal Bond in lieu of Bank Guarantee as condition for stay of assessment order in relation to payment of Value Added Tax (VAT).
The Orissa High Court quashed the cancellation of Last Pay Certificate and commented that “Reasons are manifestation of mind of Authority”. The Court noted that the cancellation of the Last Pay Certificate cannot be maintained and is indefensible.
The Delhi High Court has directed the revenue to refund the Goods and Services Tax (GST) Input Tax Credit (ITC) claimed by the petitioner, Balaji Exim as the same was rejected on the ground of alleged availment of fake input tax credit by the supplier, M/s Shruti Exports.
In a significant case the Delhi High Court while observing the Goods and Service Tax (GST) registration quashed the order passed in non-consideration of the rectification application for apparent error.
In a recent case the Delhi High Court while considering the examination of aircraft usage compliance held that customs should not be bound by the Director General of Civil Aviation decision.
The Calcutta High Court (HC) ruled that the amount that had been taken from the petitioner as a fine must be returned and underlined that a single consignment of goods cannot be maintained in storage and be in transit at the same time.
In a recent judgement, the Kerala High Court (HC) directed to correct the interim stay order passed with the mistake of the direction to remit 20% of the tax on the disputed amount. A Single member comprising Justice T R Ravi observed that the order was issued mistakenly and needs to be corrected. The Court allowed the Review Petition and recalled the order.
The Delhi High Court (HC) has held that the restriction on utilisation of the Input Tax Credit (ITC) under Rule 86 A of the Central Goods & Services Tax Rules, 2017 cannot be more than one year. While allowing the appeal, the Court set aside the impugned show cause notice and impugned order. Further, the respondents are directed to forthwith restore the ITC appropriated under the demand created by the impugned order, to the ECL of the petitioner.
In a recent judgement, the Kerala High Court (HC) set aside an assessment order and held that deduction under section 80P of the Income Tax Act, 1961 can be finalised only after analysing the form of Society.
In a major relief to Framji Dinshaw Petit Parsee Sanatorium, the petitioner, Bombay High Court quashed an assessment order after holding that there was right to claim carry forward and set off the deficit made out by the petitioner.
The Coram comprising Justice Kamal Khata and Justice Dhiraj Singh Thakur noted that the impugned notice is clearly a case of change of opinion and furthermore, AO’s the reason to believe must be based on some new tangible material which was not available at the time of passing the original Assessment Order.
In a recent decision the Bombay High Court observed that debits and credits can in no way lead to an inference of income escaped assessment.
The Court of Justices Kamal Khata and Dhiraj Singh Thakur observed that “we find no new tangible material as contended by the respondents. Debits and Credits can in no way disclose the nature of transactions or lead to an inference of income escaped assessment. Cash deposits from various places cannot be doubted to be considered suspicious transactions. In our view, there is no prima facie case made out that income has escaped assessment.” Relief to Lehman Brothers:
The Bombay High quashed assessment order passed on change of opinion thereby granting relief to Lehman Brothers Investments Pte Ltd, the petitioner.
Quashing the assessment order a Bench comprising Justices Kamal Khata and Dhiraj Singh Thakur observed that “The reopening of the assessment based on a different method of computation or application of the section is nothing else but a change of opinion, which is impermissible in law.”
The Madras High Court has recently dismissed the petition filed by the assessee, Sugan Clothing against denial of TRAN-1 amendment.
It was thus held that, “However, the primary responsibility for the same lies in the hands of the petitioner and as on date it is too late”, confirming the impugned order and dismissing the writ petition. On a positive note, no costs were imposed on the petitioner.
The Madras High Court (HC) in its recent judgement has held that the professional fee of an advocate can’t be determined after the completion of the case.
The Court struck down the consequential G.O. (D) No. 182 HW and MP (HF2) Department dated 21.12.2021 and G.O. (D) No.29 Highways and Minor Ports (HV2) Department dated 01.02.2021 and allowed the writ petition with a direction to the Government to consider the fee bills raised by the petitioner in the light of the professional assistance rendered by the petitioner.
In a significant case of Lakshdeep Investments & Finance Pvt. Ltd., the Bombay High Court (HC) has quashed the reassessment notice under section 148 of the Income Tax Act, 1961 which was issued without jurisdiction on the grounds that the only reason.
In a recent case, the Bombay High Court (HC) presided by Justices Abhay Ahuja and Nitin Jamdar directed both the Goods and Services Tax (GST) and Customs department to coordinate and decide about the correct authority to decide the Integrated Goods and Services Tax (IGST) refund.
The Gauhati High Court (HC)has directed the Commissioner of Income Tax (TDS) to expeditiously process the request for a refund of income tax deducted from the salary of the DIG (Ops) of the Border Security Force (BSF), who is a member of the scheduled tribe.
In a recent decision, the Calcutta High Court ( HC ) single bench presided over by Justice Md. Nizamuddin rejected the procedure initiated under section 148A(b) of the Income Tax Act, 1961, and imposed a personal cost of 20,000 for twice serving the non-existent corporation with a show cause notice against the Income Tax Officer (ITO).
The Delhi High Court is set to hear a bunch of petitions together on the ground of Goods and Service Tax (GST) Input Tax Credit (ITC) Denial to Buyer on ground of Default by Seller. The petitioners have challenged the vires of Section 16(2)(c) of the Central Goods and Services Tax Act, 2017.
In a recent judgement, the Kerala High Court (HC) directed the National Faceless Assessment Centre (NFAC) to expedite the hearing of the appeal and stay petition filed in Income Tax recovery proceedings.
A Division Bench of the Calcutta High Court has recently dismissed the Income Tax Appeal of the revenue against M/s Century Plyboards (I) Ltd, holding that the income from transfer of listed shares held more than a year are taxable as capital gains at the desire of the assessee.
A Division Bench of the Calcutta High Court has recently held that the Income Tax Department cannot take a view contrary to that of subsequent years in the absence of any new material that warrants the same. The Bench observed that, “In the absence of any doubt raised by the department with regard to the purchase of shares treated as investment for the preceding years and the subsequent years, a departure cannot be made by the department for the year under consideration.”
In a recent judgement, the Delhi High Court has held that the fee earned by an Agricultural Produce Marketing Committee (APMC) for regulating the poultry market is exempted under section 10(26AAB) of the Income Tax Act, 1961.
In a recent case, the Calcutta High Court (HC) upheld the order of the Income Tax Appellate Tribunal ( ITAT ) deleting the addition made the upward adjustment on account of ALP of marketing intangible created by the assessee for associate enterprises in absence of evidence to prove the assessee as the distribution company.
In a recent case, the Bombay High Court (HC) rejected the pre-arrest Bail apprehending arrest in respect of the offence punishable under Section 132 of the Maharashtra Goods and Services Tax Act, 2017 in absence of a Corporation with the investigation.
The Orissa High Court (HC) directed the Sambalpur Municipal corporation to fresh adjudication since they failed to consider the objection raised by the assessee on the enhancement of holding tax.
In a recent case, the Chief Justice Dr. S. Muralidhar and Justice G. Satapathy bench of the Orissa High Court ruled that the application for a licence for a restaurant on shop should not be rejected solely because a Goods and Services Tax (GST) return has not yet been filed because it is unreasonable to expect that to happen without the Petitioner actually starting its business.
The assessment order of the Assessing Officer (AO) was overturned by the Orissa High Court (HC), which was presided over by a bench that included Chief Justice Dr. S. Muralidhar and Justice G. Satapathy. Also, the bench was against the appraisal report submitted by the AO.
Bombay High Court (HC) presided by Justices Dhiraj Singh Thakur and Kamal Khatia ruled that the Income Tax Officer has to infer the conclusions from the primary facts stated by the assessee.
The Delhi High Court has recently directed the Goods and Services Tax ( GST ) Department to treat a petition for cancellation of GST registration obtained by misuse of the PAN and Aadhar of the petitioner as a representation to allow the petitioner to raise his claims.
In a significant case Calcutta high court held that section 50C of Income Tax Act 1961 was not applicable on compulsory acquisition of land.
The transfer of the land was not on account of the agreement between the parties, but it was the case of the compulsory acquisition under the provisions of the Right to Fair Compensation and Re Settlement Act 2013.
Therefore, the transaction could not be treated to be a transaction between two private parties where there may be room to suspect the correct valuation and the apparent sale consideration which was reflected in the sale documents.
The Madhya Pradesh High Court has provided respite to M/s Space Enclave Private Limited by halting the ongoing income tax reassessment proceedings against them.
In addition, the division bench comprising Justice S A Dharmadhikari and Justice Prakash Chandra Gupta has admitted the case for final hearing. The Madhya Pradesh High Court Bench of Justice S A Dharmadhikari and Justice Prakash Chandra Gupta also issued an interim stay of the order passed under Section 148A(d) of the Act as well as consequential notice under Section 148 of the Income Tax Act, until further orders.
While dealing with the Writ Petition Department of Revenue was instructed to abide by the directive issued by the Central Board of Indirect Taxes and Customs (CBIC) by the Orissa High Court (HC), which was presided over by Chief Justice Dr. S. Muralidhar and Justice M.S. Raman.
The bench observed the circular issued on 6th July 2022 by the CBIC that it was incumbent on the CT and GST Officer to accept the payment of tax by using the ECL. The disputed ruling dated March 29, 2022 was annulled after the division bench took the circular into consideration.
The issue was also returned to the CT and GST officer in Jaipur for them to provide a new ruling after taking into account the aforementioned circular issued by the GST Policy Wing.
The Madras High Court quashed the assessment order for not conducting search under Section 132 of the Income Tax Act, 1961.
The Single Bench of Justice Abdul Quddus observed that “Since search under Section 132 of the Income Tax Act has not been conducted on the petitioner in accordance with law, the impugned assessment orders have to be necessarily quashed and the Writ Petitions will have to be allowed.”
The Madras High Court ruled that the principles of natural justice should not be adhered to when there is no enhancement of assessment or penalty for orders passed under Section 84 of the Tamil Nadu Value Added Tax Act, 2006.
The Bench of Justice Abdul Quddhose noted that “In the case on hand also, in the impugned orders passed under section 84 of the Tamil Nadu Value Added Tax Act, 2006, there is no enhancement of assessment or penalty and therefore, there is no necessity for the respondent to adhere to the principles of natural justice as claimed by the petitioner in these writ petitions.”
The Delhi High Court confirmed the cancellation of GST Registration against MS Koenig Solutions Pvt Limited, the petitioner.
The Court of Justice Vibhu Bakhru and Amit Mahajan observed that “The petitioner’s grievance insofar as suspension / cancellation of its registration is concerned, stands addressed. Since the said grievances are addressed, we do not consider it appropriate to consider the challenge to Sub-Section (2) of Section 29 of Act and Rule 21 & Rule 21A of the GST Rules.”
The Single Bench of the Madras High Court ordered retest to determine presence of Polyurethane for imposing Anti-dumping duty. The Court noted that no prejudice would be caused to any of the parties if the test about the imported goods of the petitioner vizLining materials is conducted once again by a reputed laboratory engaged by the respondents to find out whether the imported goods contain Polyurethane or not and the cost for the same will have to be necessarily borne by the petitioner.
The Bombay High Court (HC), presided over by Justices Abhay Ahuja and Nitin Jamdar, reinstated the petitioner’s refund claim, which had been denied on the grounds that the Central Goods and Services Tax (CGST) Act of 2017’s statute of limitations had expired.
The division bench overturned the disputed order and returned the petitioner’s reimbursement claim to the Assistant Commissioner’s file after taking into account the supreme court rulings and the arguments of the counsels. Additionally, in accordance with these findings, the Assistant Commissioner will reexamine the Petitioner’s case on the merits as well as the grounds of limitation.
A Single Bench of the Allahabad High Court has recently dismissed the writ petition against the Goods and Services Tax (GST) notice and order under Section 129(3) of the U P Goods and Service Tax Act, 2017 for transporting goods 10 days after the generation of e-way bill.
The Single Bench of Rohit Ranjan Agarwal observed that there has been a complete misuse of statutory provision of the Act and Rules by the dealer. It was thus held, while dismissing the petition, that the inference drawn by the taxing authorities after interception of goods needs no interference by the Court.
A Single Bench of the Calcutta High Court recently disposed of a writ petition against cancellation of mutation of property by misinterpretation of order and remanded it for re-adjudication.
The Single Bench of Justice Amrita Sinha held that the said order will not create any equity in favour of any of the parties to the pending suit.
The Court below should decide the suit on merits without being influenced by the mutation that has been effected in favour of a party. The writ petition was thereby disposed of.
In the case of Keenara Industries Private Limited v. ITO and other 256 cases Gujarat High Court set aside Notices under section 148 of Income Tax Act, 1961 and impugned orders under section 148A(d) on the ground of limitation.
The Court of Justice Mauna M Bhatt observed that “Notices under section 148 of the Income Tax Act and impugned orders under section 148A(d) of the Income Tax Act are quashed and set aside on the ground of limitation.”
The Patna High Court granted bail under the Customs Act, 1962 on the ground that the value of gold biscuits recovered less than Rs 1 Crore and also taking into consideration the period of custody.
The Court of Justice Sunil Kumar Panwar observed that “Considering the fact that recovery of gold Biscuits/Bullions from the individual possession of the petitioners are less than Rs.
One Crore and the period under custody, let the petitioners, above named, be released on bail on furnishing bail bonds of Rs. 10,000/-.”
A Division Bench of the Delhi High Court has instructed the Commissioner of Income Tax (CIT) to grant a personal hearing to OYO Hotels and Homes Private Limited (OYO) to decide on the stay on their income tax demand of Rs. 1,140 crores.
The Delhi High Court’s decision is a significant development for OYO in their ongoing tax dispute. The court’s directive to provide a personal hearing to OYO’s authorised representative and to allow the submission of written arguments will enable OYO to present their case effectively.
In a recent case, the High Court (HC)of Jharkhand has held that the penalty under section 40 (2) of the Jharkhand Value Added Tax Act,2005 (JVAT) can’t be invoked in absence of deliberate filing of an Incorrect return.
The Court quashed and set aside the order passed by Commercial Taxes Tribunal, Jharkhand. Further, held that the amount of the alleged penalty of Rs.17,35,000/- already released from the bank accounts of Petitioner is to be refunded to the Petitioner after deducting Rs.25000/- taking resort of Section 30 (4) of the JVAT Act which prescribes a maximum penalty of Rs.25000/-
The Uttarakhand High Court (HC) in its recent judgement, has held that denial of the right to file submission against intimation in Form GST DRC -01A amounts to violation of natural justice principle. While allowing the writ petition, the Court remanded the matter back to the Competent Authority.
Further held that the “Petitioner may file his reply to the intimation in Form GST DRC-01A, within two weeks from today. The Competent Authority shall consider the reply, if filed within the stipulated time, within two weeks thereafter.”
The Orissa High Court ( HC), has held that the demise of the counsel is not a valid reason for the condonation of delay of 2569 days for the Sales Tax appeal.
A Coram comprising Justice M S Raman viewed that what was expressed in the context of the Land Acquisition proceedings cannot ipso facto be extrapolated to proceedings like the present one which arises under the Sales Tax legislation.
The Assessee is fully aware of the requirement of having to file returns and proceedings within time.
The High Court (HC) Orissa held the revisional Jurisdiction cannot be invoked when the remedy of appeal under section 78 of the Orissa Value Added Tax Act, 2004 (OVAT) Act is available.
Justice M S Raman observed that in the case of M/s. Sarala Project Works Pvt. Ltd. v. Additional Commissioner of Sales Tax, Cuttack & Others, it was held that “the specific averment of the Petitioner that the very purpose of which notice under Section 79(4) of the OVAT Act was issued by the Commissioner was already the subject matter of the appeal before the JCST, and that the Department itself could have gone in appeal against the said order under Section 78 of the OVAT Act has remained uncontroverted.
In terms of Section 79(4)(b) read with Section 79(5) of the OVAT Act there is a clear statutory bar to the Commissioner exercising suo motu revisional power in such circumstances.”
The High Court (HC) Orissa in its recent judgement has observed that obtaining conversion by assessee will increase chance of recovery by revenue and held that the State cannot oppose the claim for conversion.
A Coram comprising Justice Arindam Sinha and Justice Sanjay Kumar Mishra observed that the leasehold is likely to have restrictions on assignment and transfer of the interest. Further, in the event petitioners obtain a conversion, there will be a better chance of recovery by revenue on proceeding with the attachment of land that would then be owned by the estate.
In a significant case, the Orissa High Court (HC) held that a Show Cause Notice ( SCN ) issued after 10 years about Non-payment of service tax by providing port service is not valid.
A single-member bench comprising Justice M S Raman, in light of the case of Aspinwall and Co. Ltd. v. Commissioner of Central Excise, quashed the impugned notice dated 23rd April 2007 and further letter dated 30th October 2017 issued by the Department to the Petitioner.
Recently Madras High Court (HC) held that Assessment under section 153A of the Income Tax Act, 1961 in absence of incriminating material from the search.
A single-member bench consisting of Justice Abdul Quddhose observed that since a search under Section 132 of the Income Tax Act has not been conducted on the petitioner by the law, the impugned assessment orders have to be necessarily quashed and the Writ Petitions will have to be allowed.
The Court, while allowing the appeal, quashed the impugned assessment orders.
The Allahabad High Court recently overturned an order that imposed tax and a corresponding penalty under Section 129(3) of the Central Goods and Services Tax Act, 2017 due to an error in the vehicle number entered on the e-way bill.
The impugned order of detention and demand of Goods and Services Tax (GST) and penalty were resultantly quashed and set aside by the Single Bench of Allahabad High Court.
The disputed order and notice requesting the refund of the Input Tax Credit (ITC) with penalty and interest were annulled by the Jharkhand High Court (HC) panel composed of Acting Chief Justice Aparesh Kumar Singh and Justice Deepak Roshan.
The bench observed that the action of respondent authority denying the migration of TDS amount and consequently, levying interest and penalty thereupon is not sustainable in the eye of law.
A Single Bench of the Madras High Court confirmed the Auction Notice on the ground that the rectification petition was filed after 5 years from date of assessment order without filing statutory appeal.
The Court of Justice Abdul Quddhose observed that “the petitioner seeking for rectification of the assessment orders cannot be entertained under any circumstances whatsoever. This Court does not find any infirmity in the observation after seeing the conduct of the petitioner, which will reveal that only to protract the inevitable, the Rectification Petitions have been filed.”
The Andhra Pradesh High Court, while hearing a writ petition has held that the taxability of property can’t be challenged when the title to property is under dispute.
The Writ Petition was dismissed by the Court as being not maintainable and the parties had been given liberty to work out their remedies in respect of the possession and title of the said property in the civil Court, which is pending now.
The Orissa High Court (HC)held that the order u/s 270 passed under Income Tax Act, 1961 by Assessing Officer (AO) based on a wrong assumption is not valid when the assessee preferred for appeal.
The Court viewed that the impugned order dated 1st April 2022 is unsustainable in law since the appeal against the original assessment order is still pending.
The Court set aside the order and held that “depending on the outcome of the appeal, it may be open to the Department to revive the proceedings under Section 270A of the Act.”
A single-member bench consisting of Justice Abdul Quddhose observed that since a search under Section 132 of the Income Tax Act has not been conducted on the petitioner by the law, the impugned assessment orders have to be necessarily quashed and the Writ Petitions will have to be allowed.
The Court, while allowing the appeal, quashed the impugned assessment orders.
The Gujarat High Court (HC) held that the application for revocation of cancellation of GST registration without stating the reason is cryptic.
It was observed that certain statutory rules, which provided the prescribed limit, were disregarded and the Court acceded to the request of hearing the matter from the stage where it was left by giving the timeline for those stages to be completed.
The respondent was granted liberty to initiate the action by giving a detailed fresh show-cause notice within two (02) weeks from the receipt of a copy of this order.
The Punjab and Haryana High Court recently directed the release of the petitioner in a Goods and Services Tax (GST) false Input Tax Credit (ITC) by generation of false invoices.
The Punjab and Haryana High Court said, “Resultantly, subject to the satisfaction of the CJM/Duty Magistrate, Gurugram, which shall include the condition of the deposit of the petitioner’s valid passport, if any, the petitioner is directed to be released on bail.”
The Orissa High Court ( HC ) in its recent judgement refused to condone the delay in filing a sales tax appeal Since the illness of the counsel was not supported by a Medical Certificate. An expert Doctor’s opinion is to assist the Court, which in turn is only advisory in nature.
But, the same is not binding on the witness or fact. After all, an ‘Expert Doctor’s Evidence’ is only a piece of evidence like any other evidence, which is to be assessed by the Tribunal, by a Court of Law or by oral documentary evidence on record in coming to a particular finding.
The Delhi High Court (HC) held that a Show Cause Notice (SCN) for cancellation of GST registration without stating any reason is void.
A two-member comprising Justice Vibhu Bakhru and Justice Amit Mahajan observed that the respondent’s procedure for cancellation of the registration is flawed. The impugned show cause notice cannot be considered a show cause notice at all.
The Court set aside the impugned order dated 11.10.2022, cancelling the petitioner’s registration, which had been passed in violation of the principles of natural justice.
A Single Bench of the Madras High Court directed to consider revising GST Rates from 18%-12% on Works Contracts for National Highways.
The Court further directed the respondents to pass final orders, on merits and in accordance with law on the petitioner’s representation requesting the respondents to pay GST rates in respect of the bills raised by the petitioner at the rate of 18% instead of 12% pursuant to the recent revision of the GST rates within a period of eight weeks from the date of receipt of a copy of the order.
The Orissa High Court directed the Appropriate Authority to consider the difficulty faced by contractors due to change in the GST regime on works contracts.
The Court of Justice Dr. S. Muralidhar, Chief Justice and Justice M.S. Raman directed that the Petitioner shall make a comprehensive representation before the appropriate authority within four weeks from the date of judgement ventilating the grievance.
If such a representation is filed, the authority should consider and dispose of the same, in the light of the aforesaid revised guidelines dated 10th December, 2018 issued by the Finance Department, Government of Odisha, as expeditiously as possible, preferably within a period of three months from the date of receipt of the certified copy of the order.
In a recent case, the High Court ( HC ) of Madras has held that the order passed under section 74 of GST, 2017 without considering the reply of the assessee is not valid.
A single-member bench comprising Justice Abdul Quddhose observed that the respondent failed to consider the reply of the petitioner.
The Court quashed the impugned order, dated 05.04.2022 passed by the respondents and the matter was remanded back to the respondents for fresh consideration on merits and by law.
A Division Bench of the Allahabad High Court has recently held that the time frame under the Taxation and Other Laws (Relaxation And Amendment of Certain Provisions) Act (TOLA), 2020 is not available to the Income Tax department and quashed the reassessment proceedings initiated with the notice under Section 148 (deemed to be notice under Section 148-A) in proceedings against the assessee.
Non-granting of effective Hearing is Gross Violation of Natural Justice: Gujarat HC-GYSCOAL ALLOYS LTD. & ORS vs UNION OF INDIA & ANR-2023 TAXSCAN (HC) 412
The Gujarat High Court observed that non-granting of effective hearing is a gross violation of natural justice. The Court also noted that at the time of issuance of notice, had referred to not granting of cross examination and pointed out that such action is violative of principles of natural justice.
After hearing of petitioners, it was found by the Court that effective personal hearing was also not granted and therefore there is a complete denial of natural justice.
The Allahabad High Court remanded the matter to the Tribunal on the ground that the issue on merits not opened in Show Cause Notice ( SCN ).
The Court observed that “Prima facie, it cannot be disputed that the issue on which adjudication was sought to be made and the issue that has been adjudicated appear to be different.
Insofar as the issue on merits had not been opened in the show cause notice, prima facie case is made out for grant of interim protection.”
In a recent judgement, the Delhi High Court (HC) held that the order passed under section 148 of the Indian Constitution without considering a reply from the assessee is not valid.
Justice Rajiv Shakdher and Justice Tara Vitasta Ganju directed the Assessing Officer (AO) to carry out a de novo exercise, after giving due opportunity to the petitioner which would include furnishing to the petitioner the information/material available with the AO and the copies of approvals obtained under Section 151 of the Act.
The High Court ( HC ) of Ahmedabad has held that the dues of Secured Creditors would prevail over state tax department dues.
A two-member bench comprising Justice Sonia Gokani and Justice Sandeep N. Bhatt observed that without any assessment proceedings, the amount cannot be determined, and if the amount is yet to be determined, then before such determination there cannot be any transfer application.
Therefore, the condition precedent is that the tax should become due and such tax which has become due shall be payable by a dealer.
The Gujarat High Court (HC) presided by Justice J.B. Pardiwala and Justice Nisha M. Thakore quashed the order of Joint Commissioner, CGST and Central Excise. Further, the court directed the authorities to adjudicate the same under 89(4B) of the Central Goods and Services Tax (CGST) Rules, 2017.
The bench directed to adjudicate the claim of the writ applicants in accordance with Sub Rule (4B) of Rule 89 of the CGST Rules, but keeping in mind the formula of input / output ratio of the inputs / raw materials used in the manufacturing of the exported goods.
A Division bench of the Gujarat high Court has recently quashed the order of the appellate authority, remanding the GST matter where the GSTIN and duly filled form was subsequently revised by the petitioner after an appeal was preferred by the revenue challenging the order-in-original for lack of GSTIN in form and shipping bill.
Further observing that subsequently, at the request of the petitioner, the correct form was submitted by the Exporter to the authority and, therefore, this aspect was required to be considered by the Appellate Authority which is essentially not done in the present case”, the impugned order was quashed and set aside.
The Madras High Court directed the petitioner to pay differential duty on portable emergency lamps even when there was a lapse of 16 years for filing the writ petition.
The Court of Justice Abdul Quddhose observed that “No prejudice would be caused to the respondents if such a direction is issued as the respondents will be getting revenue in view of the deposit made by the petitioner pursuant to the directions given by this Court today.”
The Court also noted that since the petitioner has approached the Court belatedly, the Court was of the view that after a lapse of almost sixteen years from the date of the impugned order must be put on terms for quashing the impugned order.
The Jharkhand High Court has recently upheld the order of the Income Tax Appellate Tribunal ( ITAT ) against the revenue, nodding to the deletion of penalty imposed on the assessee under Section 271(1)(c) instead of Section 271AAB of the Income Tax Act.
The appeal, thus being devoid of merit, was dismissed by the Division Bench of Justices Aparesh Kumar Singh and Deepak Roshan of the Jharkhand High Court, while the order of the Income Tax Appellate Tribunal (ITAT) was upheld.
The Jharkhand High Court recently stayed the proceedings in respect of a Show Cause Notice (SCN) issued against the petitioner whereas the matter was already adjudicated by the appellate authority.
The Division Bench of the Acting Chief Justice Aparesh Kumar Singh and Justice Deepak Roshan stayed the proceedings in respect of the impugned Show Cause Notice and Summary of SCN, giving an interim relief to the assessee.
A Division Bench of the Orissa High Court has recently allowed rectification and manual submission of GST return GSTR-1 originally filed on March, 2019, observing that the interests of the revenue are not prejudiced by the said rectification and manual submission.
The order will enable the assessee to get the benefit of Input Tax Credit ( ITC ) by the principal contractor.
“Once the corrected Forms are received manually, the Department will facilitate the uploading of those details in the web portal”, the Bench further directed. The directions are to be carried out within a period of four weeks, as per the order of the Division Bench.
The division bench of Punjab and Haryana High Court (HC) consisting of Justices Ritu Bahri and Manisha Batra quashed the public auction order issued by the authorities against the petitioner.
In the instant case, the bench observed that the institution is for religious purpose and as per the notification dated 30.09.2003, Annexure P-6 issued by the government, all religious buildings and lands shall be exempted from the payment of tax.
Naresh Goyal, the founder of Jet Airways, a prominent Indian Airways and his wife escaped from the case filed by the Enforcement Department (ED) under Prevention of Money Laundering Act, 2002.
The Bombay High Court presided by Justices Revati Mohite Dere and Prithviraj Chavan quashed all the proceedings against them. The magistrate dismissed the ED’s protest petition against the closure report. Additionally, the same magistrate accepted the closure report and rejected the Akbar Tours objection petition.
The Marg police station, sessions court and also the Supreme Court dismissed ED’s plea regarding this matter. It was observed that there is no prior offence against them.
In a significant case the Bombay High Court quashed income tax proceedings against Mumbai Postal Employees and observed that re-assessment initiated based on the change of the opinion.
After considering the contentions of the both side the division bench of Justice Dhiraj Singh Thakur and Kamal Khata allowed the writ petition filed by the petitioner and observed that the jurisdictional requirement of the proviso to Section 147 of the Income Tax Act 1961 had not been complied with as the assessing officer in these case.
A Division Bench of the Bombay High Court has recently quashed impugned show cause notices and the order issued under Section 179 of the Income Tax Act, 1961, to the petitioner, as the said order did not have any reference as to how the steps to recover the income tax dues from the company assets failed.
Observing that the disclosure of steps and the failure of the same in the attempt to collect the tax dues is a sine qua non (essential condition), the Division Bench of Justice Valmiki S A Menezes and Justice Dhiraj Singh Thakur quashed and set aside the show cause notices and order issued against the petitioner.
The Bombay High Court deleted the addition made on account of interest expenditure as the assessee, Godrej & BoyceMfg. Co. Ltd, had sufficient interest-free surplus funds to make the investment.
A Bench comprising of Justice Dhiraj Singh Thakur and Justice Kamal Khata observed that “The AO has neither examined the claim in respect of expenditure incurred in relation to the exempt income of the assessee nor recorded any satisfaction with regard to the correctness of the assessee’s claim with reference to the books of account.
The disallowance made by applying Rule 8D is not only against the statutory mandate but also contrary to the legal principles laid down”.
The Gujarat High Court ( HC ) held that the order for cancellation of GST registration without determining the amount payable by the assessee is not valid.
The Court allowed the petition and quashed the show cause notice and the consequential order cancelling registration with liberty to the respondent to issue a fresh notice with particular reasons incorporating the details and a reasonable opportunity of hearing.
The High Court (HC) of Delhi, in its significant judgement, directed the Income Tax Appellate Tribunal (ITAT) to re-adjudicate the appeal by Cement Corporation of India Ltd.
Justice Rajiv Shakdher and Justice Tara Vitasta Ganju opinionated that the appeal deserves to be heard on merits and set aside the impugned order.
Further, the matter is remitted to the Tribunal for disposal of the petitioner’s statutory appeal on merits.
In a significant case the Bombay High Court bench of Justice Dhiraj Singh Thakur and Valmiki Sa Menezes, Observed that reconsidering decisions rendered in earlier regular assessment amounts to change of opinion.
Thus the bench quashed the re-assessment proceedings initiated against Pushpa Nahata. Further the bench consider that the “AO has only tried to re-visit and reconsider the decision rendered in the earlier regular assessment proceedings on the ground that the addition ought not to have been limited only to Rs.27,27,657/- and ought to have been extended to Rs.3,60,135/-.
This, in our opinion, was nothing but a change of opinion on the part of the AO, and therefore, impermissible in law.
The Delhi High Court (HC) held that tax dues under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 ( SVLDRS ) cannot exceed the amount confirmed by the commissioner of the central excise department.
The Court directed that the disputed tax dues in respect of the Petitioner would be the amount confirmed by the original authority in the first round of litigation of Rs. 1,11,35,419/-. The determination of tax by the Designated Committee in Form No. SVLDRS-3 was set aside by the Court.
A Division Bench of the Gujarat High Court has recently quashed and set aside the forced generation of Input Tax Credit (ITC) while directing the revenue to recredit the reversed ITC with interest to the electronic credit ledger of the assessee.
The Division Bench of Justices Sonia Gokani and Sandeep N Bhatt noticed that this conduct is also contrary to the instructions issued by the Board (CBIC) and therefore, the action of the petitioner which is termed to be voluntary and not have any element of voluntariness.
In a matter of reopening of assessment after 4 years based on a change of opinion without stating any reason, the Bombay High Court (HC) set aside the re-assessment order being void.
The Court held that the department has purported to reopen the assessment only based on change of opinion and the Petition does not spell out failure on the part of the assessee to disclose fully and truly all material facts. The Court set aside the impugned notice.
The Bombay High Court (HC) in its recent judgement quashed the re-assessment notice secondary email address when the primary address was provided.
The Court quashed and set aside the notice dated 28th March 2022, and all consequential proceedings including the show cause notice for proposed variation dated 25th March 2022 and assessment order u/s 144B r.w s.144 of the Income Tax Act.
On delay in the revocation application of GST registration, the Madras High Court (HC) granted time for further Submission.
Justice M Sundar observed that both sides requested a short accommodation to make further submissions on the above lines. Request acceded to. Mr C. Harsha Raj, Additional Government Pleader (Tax) was given an audience who highlighted Section 30 of the parent legislation point alluded to supra. The counsel is permitted to assist the Court in the next listing along with Mr Pramodkumar Chopda for greater clarity.
On delay of the Income Tax department’s to comply with the assessee’s refund request, the Bombay High Court ( HC ) directed to issue an additional refund.
A two-member bench comprising Justice Dhiraj Singh Thakur and Justice Kamal Khata observed that the respondent failed to take steps to comply with the order dated 18th February 2010 and even within 9 months after receipt of the letter addressed by the Petitioner on 6th March 2018.
The bail plea by the wife of an Ex-income Tax Commissioner was rejected by the Jharkhand High Court in a case relating to disproportionate assets.
The bail applicant was in custody since 07 December 2022 for the alleged commission of offences under the Prevention of Corruption Act and Indian Penal Code. The bench of Justice Gautam Kumar Choudhary of Jharkhand High Court thus rejected the bail plea of the petitioner.
The Bombay High Court has recently quashed and set aside the impugned assessment order passed by the revenue authority as per the Income Tax Appellate Tribunal, being delayed for more than 9 months from the date of receipt of order and in violation of the Section 153(3) of the Income Tax Act, 1961, further directing revenue to refund tax paid along with the jewellery seized.
Thus, the revenue was directed to release the seized jewellery and refund the paid income tax, with consequential interest under Section 244A of the Income Tax Act, to the petitioners within two weeks from the receipt of the order.
The Bombay High Court ( HC ) in its recent judgement has held that failure to get Sanction under section 151(ii) of the Income Tax Act, 1961 from PCIT for reopening of assessment beyond 3 years will invalidate the reassessment proceedings.
A two-member bench comprising Justice Dhiraj Singh Thakur and Justice Kamal Khata viewed that before issuing the notice under section 148A (b) the AO needed to have checked if there was a change of address.
A condition precedent for any proceeding including a proceeding u/s. 148A, is a valid service of notice, lest it would be a jurisdictional error.
In a significant ruling, the Delhi High Court (HC) held that C Forms cannot be cancelled with its retrospective effect to deny the benefit to the assessee. In Jain Manufacturing (India) Pvt. Ltd. v. The Commissioner Value Added Tax & Anr. it was held that C-forms cannot be cancelled retrospectively.
In light of the decision, Justice Vibhu Bakhru and Justice Amit Mahajan held that the benefit of the C-Forms in question cannot be denied to the petitioner, by cancelling the same retrospectively and allowing the petition.
The Bombay High court has recently held that mere change of opinion did not provide jurisdiction to re-open assessment.
After considering the contentions of the both parties the division bench of Justice Dhiraj Singh Thakur and Valmiki SA Menezes allowed the writ petition filed by the petitioner and observed that “assessing officer has failed to establish that there was any failure on the part of the assessee to disclose fully and truly any material fact in the present case”
The Madhya Pradesh High Court upholds the order of Income Tax Appellate Authority (ITAT) upon the deletion of addition when there is no incriminating material found during the search.
After considering the submission of the both parties the single bench of Justice Sushrut Arvind Dharmadhikari dismiss the appeal filed by the revenue and observed that “No incriminating documents during the course of search were found, the order in appeal could not be said to have suffered any illegality as would give rise to proposed substantial question of law”.
A Single Bench of Delhi High Court has held that the advance authorization could not be denied to the importer merely based on notification under Section 5 of the Foreign Trade Development and Regulation Act, 1992.
A Single Bench of Justice Prathiba M. Singh quashed the impugned order in view of the legal position in Kanak Exports.
The Bench further observed that, “The Advance Authorization of the Petitioner was applied for on 26th June, 2019 and the same would have to therefore, be considered in terms of the legal position prevalent on the said date. The subsequent notification cannot be applied retrospectively to reject the said Advance Authorization. Under Section 5 of the Foreign Trade (Development and Regulation) Act, 1992, it is the settled legal position as held in Kanak Exports (supra), that a retrospective application of a later notification, cannot be made by the Central Government”
The Telangana High Court remanded back matter to ensure opportunity of hearing in the matter of cancellation of the GST Registration.
The Coram consisting of Chief Justice Ujjal Bhuyan and Justice N Tukaramji observed that “Thus, following the above decision, we set aside the order passed by respondent and remand the matter back to respondent No.4 for a fresh decision in accordance with law.
The Respondent shall afford a reasonable opportunity of hearing to the petitioner while passing the fresh order on remand. In the remand proceedings, it will be open to the petitioner to submit the GST returns as per the statute.”
In a recent decision the Telangana High Court noted that further burden cannot be imposed during pendency of appeal on remittance of 25% of disputed tax.
The Bench comprising Chief Justice Ujjal Bhuyan and Justice N Tukaramji observed that “Merely because petitioner has availed the remedy provided by the statute, there should not be additional burden on the petitioner.
Having regard to the fact that petitioner has already deposited 25% of the disputed tax and considering the fact that the larger issue is pending consideration before this Court, we are of the view that insisting on further payment by the petitioner during the pendency of the appeal would not be just and proper.”
The Bombay High Court (HC) bench of Justice Abhay Ahuja and Justice Bhiraj Singh Thakur observed that there is no proof of negligence or breach of duty of malfeasance against the petitioner and the Assessing Officer (AO) couldn’t state any such act.
The bench noted that not a single instance, choice, or action made by the AO was cited as evidence of gross negligence, a failure to perform a duty, or any wrongdoing that even remotely might have prevented future tax obligations from being recovered.
The Bombay High Court quashed re assessment notice on the ground that there was no satisfaction of jurisdictional conditions by the Assessing Officer (AO).
The Coram consisting of Justices Dhiraj Singh Thakur and Valmiki Sa Menezes observed that “We have no hesitation in holding that both the jurisdictional conditions had not been satisfied by the AO in the reasons recorded on the touchstone of section 147 of the Act.”
The Bombay High Court ( HC ) in its recent judgement has held that reopening of assessment based on mere change of opinion is not allowable.
Justice Dhiraj Singh Thakur & Justice Kamal Khata held that “there was no basis to hold that there was any failure on the part of the assessee to disclose any material facts fully and truly during the regular assessment proceedings and further that reassessment proceedings are nothing but a change of opinion.”
The Court set aside and quashed the impugned notice and the order of reassessment which are without jurisdiction.
The Allahabad High Court confirmed detention of goods on the ground that there was an undervaluation of huge quantities of Pan Masala and Tobacco without downloading mandatory E-Way bills.
The Court concluded by stating that if such a conduct of a dealer is permitted, it will harm the business world and lead to a parallel economy and the very purpose of enactment of the Goods and Service Tax Act would frustrate. The idea of ‘One Nation One Tax’ was to subsume all other taxes into one and bring transparency in the business world.
The Bombay High Court has quashed the notice under Section 148 of the Income Tax Act 1961 as no change of law and no new material on record was found.
“Testing the facts of the present case on the touchstone of the judgments referred hereinabove, it is thus clear that the basis for reopening remains the same which was otherwise the subject matter of scrutiny by the AO during the scrutiny assessment proceedings leading to passing of the order under section 143(3) of the Act”, the Bench further observed.
The Allahabad High Court ( HC ) refused to grant bail since the assessee failed to satisfy the twin condition under section 45 of the Prevention of Money Laundering Act, 2002 ( PMLA ).
The Court observed that the bail application of the present application does not qualify the twin conditions of Section 45 of the PMLA since at this stage it cannot be observed that the present applicant has not committed the offence for which the complaint has been filed against him.
The applicant is based in Abu Dhabi. The factum of guilt can be proved or disproved before the learned trial court. The Court rejected the bail application and directed the trial court to conclude the trial with an expedition, preferably within a period of six months by fixing a short date and no unnecessary adjournment shall be given.
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