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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.
In a recent judgment the Kerala High Court quashed the property tax demand made without assessment of property under the Kerala Panchayat Raj Act, 1994.
The Court further directed that in case the petitioner submits his objections to the assessment of property tax, the same shall be taken note of by the Secretary and a proper order of assessment shall be passed with notice to the petitioner. The demands, if any, on the basis of such assessment can be raised by the Secretary in accordance with the provisions of the Panchayat Raj Act and the Rules made thereunder.
A Single Bench of the Kerala High Court recently ruled that there is necessity for land to be re-assessed for fixing basic tax rate after the change in nature of the land under the Kerala Land Utilisation Order, 1967.
A Single Bench of Justice N Nagaresh observed that âAs the nature of the land of the petitioner has been permitted to be changed pursuant to passing of a statutory order under the Kerala Land Utilisation Order, 1967, the competent authority is bound to re-assess the rate of Basic Tax in respect of the land and to make necessary entries in the Basic Tax Register, if necessary, after verifying the veracity/genuineness of the permission obtained under the Kerala Land Utilisation Order, 1967 produced by the petitioner.â
A Division Bench of the Delhi High Court quashed the order under Section 148A(d) of Income Tax Act, 1961 and an assessment notice issued against non-existent partnership firm.
A Division Bench of the Delhi High Court comprising Justices Girish Kathpalia and Rajiv Shakdher observed that âIn nutshell, the impugned order under Section 148A(d) of the Income Tax Act and notice under Section 148 of the Income Tax Act were passed and issued against a non-extant entity, as such the same cannot be complied with. Therefore, the impugned order under Section 148A(d) and notice under Section 148 of the Income Tax Act both are set aside. The respondents would be at liberty to take further steps in accordance with law.â
A Division Bench of the Jharkhand High Court confirmed the deletion of income tax addition on Business expenses under âProvision for Warranty Expensesâ.
A Division Bench comprising Justices Rongon Mukhopadhyay and Deepak Roshan observed that âThe Assessee has not committed any violation of the provisions of the Income Tax Act and its Rules. As a matter of fact, the ITAT has discussed each and every ground raised by the Revenue in detail and rejected the contentions of the Revenue and dismissed their appeal filed before it. We hold that no error has been committed by the tribunal in rejecting the claim of the respondent revenue and dismissing the respective appeal.â
The Calcutta High Court quashed an assessment order passed on non-consideration of the objection to the show cause notice as there was delay in filing objection due to technical snag in the Income Tax Portal. The Court directed that a judicious should be passed after giving an opportunity of hearing, within a period of eight weeks from the date of communication of the order and also clarified that it has not gone into the merit of the objection of the petitioner and the same shall be decided by the assessing officer concerned by applying its independent judicious mind.
The Madras High Court stayed the condition of furnishing of bank guarantee on remission of 50% of disputed tax. The Court further noted that subject to the furnishing of personal bond by the petitioner, there shall be an order of stay of balance of the disputed tax till the disposal of the appeal by the first appellate authority. It was made clear that impugned order was modified to the limited extent alone.
The Madras High Court quashed a notice issued to discharge tax liability on filing of an additional rectification petition filed under Section 84 of Tamil Nadu Value Added Tax Act.
The Bench concluded by observing that âIn light of the fact that the additional rectification petition is now pending in light of setting aside of order, the petitioner is permitted to appear before the authority for hearing of both the rectification petition as well as additional rectification petition dated 16.03.2023 and 12.04.2023 respectively on 23.06.2023 at 10.30 a.m. without expecting any notice in this regard to the hearing as scheduled aforesaid.â
The Gujarat High Court (HC) quashed the Show Cause Notice (SCN) wherein the cancellation of Goods and Service Tax (GST) registration without stating the reason is cryptic.
The impugned show-cause notice dated 06.01.2023, being without reasons, is cryptic and the bench quashed and set aside. However, liberty is granted to the respondent authorities to issue a fresh notice with particulars of reasons incorporated with details and thereafter to provide a reasonable opportunity of hearing to the petitioner and to pass appropriate order bythe law. The concerned respondent is hereby directed to restore the registration of the petitioner forthwith.
The Gauhati High Court stayed the recovery of royalty due till the next returnable dates as an interim measure.
âAs an ad-interim measure that no coercive action shall be initiated against the petitioner for recovery of the said amount of Rs.3,00,24,540/- till the next returnable date, as a natural sequel, would have to provide as an interim measure that till the next returnable date, the respondent nos. 2 to 4 shall not initiate coercive action against the petitioner for recovery of the amount indicated in the communication under memo no. FSET/G-51/B/Simplex/2023/1450-51 dated 16.03.2023 till the next returnable date.â, the single judge bench comprising Justice Kalyan Rai Surana held.
The Madras Bench of the High Court has held that the appellate authority should consider the Goods and Service Tax (GST) appeal with reference to the statutory compliance only without referring to the limitation.
The petition was dismissed by the Single Bench of Justice Anita Sumanth granting liberty to file appeal and appeal, if any had filed within a period of four (4) weeks from date of receipt of a copy of this order, it was directed to be entertained by the appellate authority without reference to limitation but ensuring compliance with all other statutory conditions.
The High Court of Karnataka dismissed the Writ Petition direction to declare section 16(4) of the Central Goods and Service Tax (CGST/SGST) Act 2017 r/w Rule 61 of Karnataka Goods and Service Tax (KGST) Rules as ultra vires constitution.
A Single judge bench comprising Justice S Vshwajith Shetty dismissed the writ petition as not pressed with liberty to the petitioner to challenge the order dated 01.05.2023 passed by the 2nd respondent in a separate proceeding.
The Delhi High Court granted interim bail to Sameer Mahandru under the Prevention of Money Laundering Act (PMLA), 2002 in the Delhi Excise Policy Case .
âIn view of the entirety of the matter, the petitioner is admitted to interim bail for a period of six weeks on his furnishing a personal bond in the sum of Rs.10,00,000/- (Rupees Ten Lakhs Only) with two suretiesâ the Court concluded.
In a recent decision the Delhi High Court ruled that the power to grant bail on medical /grounds under first proviso to Section 45(1) of the Prevention of Money Laundering Act, 2002 (PMLA) is discretionary and directed the Director of All India Institute of Medical Sciences (AIIMS) to evaluate the medical condition of the petitioner, Sanjay Jain.
The Court further went on to note that on humanitarian grounds, the medical condition of the petitioner as articulated in the affidavit of petitionerâs wife cannot be simply brushed aside given. Hence the Director, All India Institute of Medical Sciences (AIIMS) was directed to immediately constitute a Medical Board of Doctors from minimum three different specialties having regard to the nature of ailments the petitioner is stated to be suffering from, for evaluating the medical condition of the petitioner.
A Single Bench of the Kerala High Court recently observed that the appeal Provision of the Central Goods and Services Tax Act, 2017 (CGST) is inbuilt mechanism and impliedly excludes the application of Limitation Act, 1963.
Confirming the action of the Additional Commissioner a Court of Justice CS Dias, observed that âThe Central Goods and Services Tax Act is a special statute and a self-contained code by itself. Section 107 is an inbuilt mechanism and has impliedly excluded the application of the Limitation Act. It is trite, that the Limitation Act will apply only if it is extended to the special statute. It is also rudimentary that the provisions of a fiscal statute have to be strictly construed and interpreted.â
The Calcutta High Court in a bogus case of E -Way Bill directed to release of the Tea consignment since it was not connected with the smuggled poppy seeds.
Justice Krishna Rao directed the respondent no. 3 to take appropriate steps for the release of the tea consignment in favour of the petitioner by law if there does no impedereleasing the tea consignment within a period of one week from the date of receipt of the copy of the order subject to furnishing an undertaking before the authority, as and when, if required, the petitioner will appear before the authority for enquiry/investigation.
A Single Bench of Justice Bharat P. Deshpande of Bombay High Court upheld the cancellation of the liquor license by the Excise Commissioner in the application of the legal heirs of the deceased partner.
The bench stated that âThe appellate authority in its impugned order has rightly observed that the petitioner is trying to mix the issues with regard to the Deed of Partnership with that of transfer of licence under the provisions of the Goa Excise Duty Act.â It was also stated that it is the duty of the concerned authority and when the legal heirs of the deceased licence holder applied for cancellation, the excise Commissioner was duty bound to cancel it.
A Single Bench of the Delhi High Court granted bail to Preeti Chandra in the Unitech Case and observed that sub-classifying women into different categories to apply twin conditions under the Prevention of Money Laundering Act, 2002 (PMLA) is arbitrary. The Bench concluded by noting that the twin conditions of Section 45 of the PMLA will not be applicable to the applicant. The applicant has to satisfy the triple test which can be taken care of by imposing stringent conditions. The applicant has already been investigated for more than 13 occasions and has been in custody for more than 20 months.
The Calcutta High Court dismissed an assessment order passed during pendency of writ petition, taking into consideration the non-participation of the petitioners, SKP Infrarealty Private Limited & Anr, in the income tax proceedings.
A Single Bench comprising Justice Md Nizamuddin observed that âIn the interest of principle of natural justice the impugned order under Section 147 of the Income Tax Act relating to assessment year 2014-2015 is set aside and the matter is remanded back to the Assessing Officer concerned to proceed afresh from the stage subsequent to notice under Section 148 of the Income Tax Act and conclude the proceedings and pass final order within twelve weeks from the date of communication of the order.â
In a major decision the Bombay High Court observed that mere filing of an application under Section 7(1) of the Insolvency and Bankruptcy Code, 2016 (IBC) is not enough to invoke the bar of Section 238 of the Insolvency and Bankruptcy Code and consequently it would not bar the to file an application under Section 11 (6) of the Arbitration and Conciliation Act, 1996 for appointment of Arbitrator. The proviso to Section 7(4) of the IBC further enjoins the Adjudicating Authority to record reasons for not ascertaining the factors, as contemplated by Section 7(4) of IBC, within the time frame stipulated therein. Further Section 7(5) of the IBC enjoins upon the Adjudicating Authority to record its satisfaction that the default has occurred and there is no disciplinary proceedings pending against the proposed resolution professional and upon such satisfaction permits admission of such applicationâ the Bench concluded.
The Calcutta High Court quashes an order of the Single Bench of the Calcutta High Court directing to remit 20% of disputed tax in contravention of Section 107(7) of the Central Goods and Services Tax (CGST) Act, 2017. Accordingly, the appeal is allowed and that portion of the order passed by the Single Bench directing the appellant to pay 20% of the interest amount is set aside and direction is issued to the appellate authority to consider the appeal filed by the appellant on merits and in accordance with law after affording an opportunity of personal hearingâ the Bench concluded.
The Delhi High Court granted interim protection to M3M owner Basant Bansal in the money laundering case. In the interest of justice as well as considering the mandate of Article 21 of the Constitution of India, this Court is of the considered opinion that the Applicant may be granted interim protection till the next date of hearingâ the Court concluded.
The Gujarat High Court in a recent case dismissed the Writ Petition (WP)since the provision under section 73(9) read with sections 78 and 107 of the Gujarat Goods and Services Tax Act, 2017 is misconceived.
While dismissing the WP the Coram comprising Justice Vipul M Pancholi and Justice Devan M Desai viewed that such contention is misconceived in view of the provisions contained in Section 73(9) read with Sections 78 and 107 of the Act. If the appeal filed by the petitioner is allowed by the Appellate Authority, it is always open for the petitioner to make such request before the Appellate Authority that direction be issued to the respondents to refund the amount.
While entertaining the Sales Tax Revision (STR) filed by the revenue department, the Rajasthan High Court maintained the penalty imposed on the Chokhi Dhani Resorts. Also quashed the order of the tax board issued in favour of the resort.
The bench observing the definition of Sale and Sale Price under RVAT stated that the assessee cannot split up the amount charged for the sale of food, even if assessee provides certain services in addition to the food, and VAT has to be paid on the entire consideration charged for the food. It was held that VAT is applicable on whole entry coupons. Thus, set aside and quashed the impugned order of the tax board and maintained the penalty imposed.
A Single Bench of the Calcutta High Court directed the release of tea consignment on the proof of non- involvement of the supplier of the tea with the smuggled poppy seeds. A Single Bench comprising Justice Krishna Rao, observed that âThe Court finds that no purpose would be served by keeping the writ petition pending. Accordingly, the writ petition is disposed of by directing the respondent to take appropriate steps for release of the tea consignment in favour of the petitioner in accordance with law if there is no impediment for release tea consignment within a period of one week from the date of receipt of the copy of the order.â
The Calcutta High Court quashed demand for interest and refund of stamp duty and registration fee on no proper enquiry about property before participating in the auction. A Division Bench comprising Justice Tapabrata Chakraborty and Justice Partha Sarathi Chatterjee observed that âThe appellant also had not made a proper enquiry about the property before participating in the auction and she ought to have been more diligent. For such laches we are not inclined to allow the appellantâs prayer for interest and refund of the stamp duty and registration fee.â
The Gujarat High Court quashed the order cancelling the registration of Goods and Services Tax (GST) passed without stating a detailed reason for the cancellation.
Further liberty was granted to the respondent authorities to issue a fresh notice with particulars of reasons incorporated with details and thereafter to provide a reasonable opportunity of hearing to the petitioner and to pass appropriate order by law. The concerned respondent is directed to restore the registration of the petitioner forthwith.
The Kerala High Court directed to accept Form 3 and Form 4 within 10 days without additional fee in a matter relating to technical glitches in the Ministry of Corporate Affairs (MCA) Portal.
In the interim order on 21/06/2023, a Single Bench of the Kerala High Court of Justice PV Kunhikrishnan ordered the respondents to accept Form 3 and Form 4 within 10 days without insisting the additional fee of Rs.37,500/-. Ebin Mathew, P J Mathew, Akhila Shoji appeared at the Kerala High Court on behalf of the petitioner â Safa Jewels Areacode LLP.
A Single Bench of the Madras High Court condoned the delay of 2 days in manual filing of appeal after online submission on the Goods and Service Tax (GST) Portal.
A Court of Dr Justice Anita Sumanth noted that âIn light of the above, the delay of 2 days in filing the appeal is condoned and the challenge to the order of assessment is rejected. The petitioner is permitted to re-present the appeal papers within a period of one (1) week from today and if so re-presented, R2 shall receive the appeal without reference to limitation but ensuring compliance with all other statutory conditions, including pre-deposit.â
The Delhi High Court granted bail to Dubai based businessman Ramesh Mangalani under the Prevention of Money Laundering Act, 2002 (PMLA) on allegation of siphoning off amount by fake invoices.
Considering that the prosecution complaint has been filed before the learned trial court; that the petitioner has materially co-operated in the investigation; and in view of the nature of the alleged role played by the petitioner in the allegedly offending transactions, this court is also satisfied that the petitioner is not likely to commit any offence under PMLA while on bailâ the Court concluded.
The Gujarat High Court dismissed revision petition filed on lack of evidence on the basis of allegation of sale of High-Speed Diesel (HSD) at concessional sales tax rate without permission from Ministry of Petroleum & Natural Gas.
A Single Judge Bench comprising Justice Gita Gopi observed that âThis Court finds that the Special Judge has not committed any error in discharging the accused. No sanction has been granted for prosecuting the officers of the oil companies. The assessment made by the Special Judge discharging the accused is consistent with the record.â
The Karnataka High Court recently held that there is no requirement for educational institutions to obtain yearly certificate to claim property tax exemption under the Karnataka Municipalities Act, 1964.
A Single Bench Justice Suraj Govindaraj comprising of observed that âThere being no requirement for seeking for an exemption certificate, I am of the considered opinion that this exemption is absolute and apply to all buildings which are used for the purpose of running educational institution and/or incidental activity.â
The Calcutta High Court directed to release of the tea consignment in the case of Smuggling of Poppy Seed by way of the Consolidated E â Way Bill. Justice Krishna Rao observed that âno purpose would be served by keeping the writ petition pending. Accordingly, the writ petition is disposed of by directing the respondent no. 3 to take appropriate steps for release the tea consignment in favour of the petitioner by law if there does not impede releasing the tea consignment within a period of one week from the date of receipt of the copy of the order, subject to furnishing an undertaking before the authority, as and when, if required, the petitioner will appear before the authority for enquiry/investigation.â
The Calcutta High Court allowed the release of seized machinery on bank guarantee as the petitioner, DRB Infrastructure Pvt. Ltd, has challenged the legality of the seizure.
A Single Judge Bench of Justice Krishna Rao, observed that âthe Court is of the view that the writ petition can only be disposed of only after exchange of affidavits and accordingly, the respondents are directed to file affidavit-in-opposition within three weeks; reply thereto, if any, be filed within two weeks thereafter.â
The Division Bench of Justice K.R.Shriram and Justice M.M.Sathaye of Bombay High court has quashed the income tax recovery against directors upon proving lack of control on financial affairs of company. The petitioner is squarely covered by the exception carved out by the later part of Section 179(1) of the Income Tax Act and as such he cannot be held liable. Therefore, the division bench quashed the order holding Petitioner liable for outstanding dues of M/s. Kaizen Automation Pvt. Ltd
The Delhi High court recently directed the Assessing Officer (AO) to provide information to vodafone Mauritius regarding validity of Tax Residency Certificate (TRC). After observing the contentions and relevant materials, the division bench of Justice Rajiv Shakdher and Justice Girish Kathpalia direct the AO to confront the petitioner with material or information, which according to her, would have her arrive at a conclusion that the TRC on which the petitioner seeks to place reliance deserves to be rejected.
A Single Bench of the Calcutta High Court dismissed the writ petition by observing that the benefit from the arranged accommodation entries is unaccounted money. The Court concluded by noting that the impugned order is neither a final assessment order nor any demand arises out of the same and the petitioner still has got ample scope in the course of the proceeding subsequent to the aforesaid impugned order under Section 148A(d) of the Income Tax Act and after issuance notice under Section 148 of the Income Tax Act to make out his case if he has any in his favour during the course of subsequent proceeding.
The Karnataka High Court directed the State and Government agencies to determine tax differences on Pre-Goods and Service Tax (GST) works contracts under the Karnataka Value Added Tax (KVAT) regime.
A supplementary agreement may be signed with the Petitioners for the revised GST-inclusive work value for the Balance Work completed or to be completed as determined above and in case the revised GST-inclusive work value for the Balance Work, completed or to be completed after 01.07.2017, is more than the original agreement work value, the Petitioners are to be paid /reimbursed, as the case may be, the differential tax amount by the concerned employer,â the Court said.
The Ahmedabad High Court while dismissing a writ petition (WP), noted that the proper officer issuing order under Special Economic Zones (SEZ) Act, 2005, is equivalent to order under the Central Goods and Services Tax (CGST) Act, 2017.
The Bench lashed against the petitioners by commenting that the petition was an attempt on the part of petitioners to thwart and delay the legal proceedings which are initiated by respondent authorities and as such this move of petitioners appears to be an abuse of process of law looking to the manner in which the irregularities alleged to have been committed. The Court further directed the petitioner to deposit the costs of Rs.10,000/- (Rupees Ten Thousand only) for each petition to be paid to Gujarat State Legal Service Authority within ten days from the date of judgment.
The Gujarat High Court granted anticipatory bail to public servant arrested under Prevention of Corruption on no need of custodial interrogation
A Single Bench of Justice Nirzar S Desai observed that âHaving heard the learned advocates for the parties and perusing the material placed on record and taking into consideration the facts of the case, nature of allegations, gravity of offences, role attributed to the accused, without discussing the evidence in detail, at this stage, I am inclined to grant anticipatory bail to the applicant.â The Court further noted that the anticipatory bail was granted takin into consideration the facts and circumstances of the present case and since the custodial interrogation of the applicant is not required.
The Punjab and Haryana High Court directed the Goods and Service Tax (GST) Department to refund amount recovered through DRC03 when no show cause notice (SCN) was issued.
The Bench further directed the GST Department to return the amount in question to the petitioner along with simple interest at the rate of 6% per annum from the date of deposit till the payment is made. The amount will be refunded to the petitioner within a period of two weeks from the date of receipt of certified copy of this judgment.
A Single Bench of the Calcutta High Court dismissed writ petition (WP) as no cogent explanation was given for the delay of three years. âIn view of the conduct of the petitioner in approaching the writ court after such inordinate delay without any explanation and in view of the fact that an adjudication order has already been passed which is an appealable order, I am not inclined to entertain this writ petitionâ the Court opined. The Court however, concluded by noting that the dismissal of the writ petition, however, will not be a bar for the petitioner to seek any relief before the appropriate forum in accordance with applicable law.
A Single Bench of the Madras High Court observed that a suit can be maintained by the President as the representative of a trust in terms of the trust deed for and on behalf of the trust. A Single Bench comprising Justice K Kumarsh Babu observed that âA Suit can be maintained by a representative of the Trust in terms of the Trust Deed for and on behalf of the Trust. In the present case, the Trust Deed produced by the plaintiff would suggest that the President who is one of the trustees is entitled to file a suit.â
A Division Bench of the Rajasthan High Court dismissed a writ petition (WP) which was filed in the apprehension that the GST authorities would not take into consideration reply filed by the petitioner, Sodhani Sweets Private Limited.
A Division Bench of the High Court comprising Chief Justice Augustine George Masih and Justice Manindra Mohan Srivastava observed that âThis apprehension on the part of learned counsel for the petitioner cannot be assumed at this stage. However, it is expected and is required that the pleas which would be taken by the petitioner in response to Show Cause Notice would be duly considered and dealt with while taking a decision.â
While entertaining the Sales Tax Revision petition, the Rajasthan High Court quashed the additional tax and interest order. A Single Bench of Justice Sameer Jain observed that the burden to prove that a specific product falls within a particular tariff is always on the revenue.
The High Court opined that the tax board erred in law by not applying the correct ratio of the quoted judgments in their true sense. Further clearly stated that âThe burden to prove that a specific product falls within a particular tariff is always on the revenue, more so when the revenue is trying to classify products in the residual entry as against the specific entry. I.â Moreover, in the instant case, the revenue has utterly failed to adduce any evidence, technical or otherwise, to substantiate its claim that CAT-5 or CAT-6 cables are not covered in Part-A of Schedule IV to the RVAT Act which specifically deals with IT Products.
The Punjab and Haryana High Court (HC) directed the authorities to defreeze the 50% of the attached amount of the online betting app to carry out their day to day activities.
The bench of Justice Ritu Bahri and Justice Ritu Batra also ordered not to take any coercive steps against the petitioner company. Considering the submissions of the counsels, the High Court stated that âno coercive steps will be taken for recovery of the amount demanded as per the show cause notice dated 19.05.2023 (Annexure P-1) and 50% of the attached amount should be defreezed so that the petitioner-company can carry out its day to day working. Recently, the Karnataka High Court quashed the GST Notice of Rs. 21000 crores against the Gameskraft which had imposed Rs. 21,000 Crore at 28% GST on online gaming services provided to gamers.
The Calcutta High Court quashes assessment notice issued against non-existing entity on the conversion of a company into a Limited Liability Partnership (LLP). A Single Bench of Justice Md Nizamuddin observed that âThis writ petition is disposed of by quashing the impugned order to the writ petition and the impugned notice to the writ petition.â The Court concluded by noting that âHowever, dismissal of this writ petition will not prevent the Income Tax Authority concerned to issue any fresh notice, in the matter in accordance with law.â
A Single Bench of the Calcutta High Court observed that the sufficiency of reasons and findings in order under Section 148A(d) of the Income Tax Act, 1961 cannot be scrutinized by a writ court.
âMatter would have been different had the assessing officer not given any reason at all or had not referred the objection of the petitioner. Just by mere coming to a different conclusion on the basis of the objection or the material furnished by the petitioner cannot be a ground of invoking Constitutional Writ Jurisdiction under Article 226 of the Constitution of Indiaâ the Court opined.
The Bombay High Court ruled that a writ petition is maintainable to question initiation of proceedings under Section 148 of the Income Tax Act, 1961.
A Division Bench of the Bombay High Court comprising Justices M. W. Chandwani and A. S. Chandurkar observed that âIn the present writ petition the petitioner has raised a challenge to the initiation of proceedings and exercise of power under Section 148 of the Income Tax Act of 1961 by urging that the statutory requirements prescribed by Section 148 of the Income Tax Act have not been satisfied. â
âIn other words, it is submitted that since there is no existence of any reason to believe, reopening of the proceedings by the respondent is without jurisdiction. Since the jurisdiction of the respondent of initiating the proceedings, itself is under challenge, the writ petition would be maintainable. In the light of the challenge as raised it cannot be said that the writ petition is not maintainableâ the Court concluded.
The High Court of Bombay has delivered a significant ruling on the issue of âlifting the corporate veilâ. The Bombay High Court has distinguished NYK Line and NYK Theseus Corporation on the observation that the fact of Commonality or Common Ownership without the Element of Deceit or attempt at Fraud is not sufficient for âLifting the Corporate Veilâ &Establishing an âAlter Egoâ.
The Single Bench of Justice N. J. Jamadar clarified that the establishment of multiple companies with common shareholding, directed by the same family and holding different assets, is not inherently problematic. The mere existence of commonality or common ownership, directorship, or interlocking shareholding is not sufficient prima facie evidence to conclude that one company is the alter ego of another. To establish alter ego status, there must be an element of deceit, an attempt at fraud, or a colourable transaction, the bench held.
The petitioners claim to be the licensee under one Varun Roshan Kohli who happens to be a sub-tenant under one Sati Mulchandani Business Centre in respect of 1200 sq. ft. in the ground floor flat. A sum of Rs.1,53,48,418/- is due on account of property tax in respect of the ground floor of the subject premises. In the process of recovery of the property tax dues, the Kolkata Municipal Corporation issued a notice of rent attachment against the petitioners.
The petitioners pray for a direction upon the Kolkata Municipal Corporation to refrain from taking any coercive steps against them for recovery of the outstanding property tax dues. A Single Bench of the Calcutta High Court comprising Justice Amrita Sinha observed that âThe petitioners admit to be in possession of 1200 sq. ft. of the subject premises. It will be open for the Corporation to raise demand upon the petitioners to recover the property tax dues in respect of the area which is actually possessed by the petitioners. An opportunity of hearing shall be provided to the petitioners prior to initiating steps for recovery of the tax dues.â
The Calcutta High Court dismissed a writ petition as the jurisdiction of âSpecified Authority under Section 151 of the Income Tax Act, 1961is not challenged.
Dismissing the writ petition a Single Bench of the Calcutta High Court observed comprising Md Nizamuddin that âOn perusal of Section 151(i) and 151(ii) of the Income Tax Act, 1961 which simply says as to who will be the âSpecified Authorityâ for Section 148 and Section 148A of the Income Tax Act and in this case jurisdiction of the âSpecified Authorityâ who hasapproved for Section 148 and 148A of the Income Tax Act has not been challenged.â
In a significant case, the Karnataka High Court quashed the recovery from the banker and directed the department to reconsider the application under the Karasamadhana Scheme. The bench of Justice S. Sunil Dutt Yadav has observed that if the application is rejected, it is needless to state that the petitioner cannot be placed in a position worse off, and the petitioner is entitled to the restoration of his appeal, which would be a logical course of action.
In a recent case, the Madras High Court (HC) held that the exemption under customs notification was allowable when the export obligation was fulfilled and set aside the demand of Customs Duty.
The Court set aside the impugned order and the matter remanded to the file of Respondent 1, to be decided afresh and in line with the discussion in this order after ascertaining if the petitioner has made any additions to the imported valves by procurement of indigenous products.
While entertaining the Writ Petition against the Ministry of Corporate Affairs (MCA) portal issue, a Single Bench of Justice P.V. Kunhikrishnan was ordered to resolve the issue in filing form NDH-4 within 1 week. Recently, another plea was submitted before the Kerala High Court in which a designated partner of the petitioner Limited Liability Partnership (LLP) citing the inability to file LLP Forms in the MCA Portal. However, the MCA, represented by Central Government Counsel Jagadeesh Lakshman has submitted that the resolution of the MCA V1/V2/V3/21 Portal issues is in progress.
The Calcutta High Court has held that banks cannot make lookout circular a recovery norm as it violates the fundamental right of movement and allowed the Writ Petition (WP).
âApart from the reach of Look Out Circulars to cause immediate and irrevocable violation of a personâs fundamental right of movement, Look Out Circulars have an inexplicably long shelf-life. Once a Look Out Circular is issued, it remains alive and kicking for almost all times to come. This spells dangerous repercussions on the personâs right to freely move across and beyond the country and remain mobile, âthe bench of Justice Moushumi Bhattacharya observed. While allowing the Writ Petition the Court quashed the impugned Look Out Circular issued by the respondent Bank.
A Division Bench of the Allahabad High Court expressed its grief against the Lucknow GST Commissionerate and expresses its concern that practicing advocates should not have to face harassment on account of the department issuing notices and calling upon them to pay Service Tax/GST when they are exempted from doing so and in the process also calling them to prove that they are practicing advocates.
During the hearing a number of members of the Bar also informed the Court that similar notices have been issued to the various members of the Bar. The Bench comprising Justices Jyotsna Sharma and Alok Mathur observed that âThe Commissioner, GST is directed to issue clear direction to the GST Commissionerate in Lucknow that no notices regarding payment of service tax /GST is issued to the lawyers rendering legal service falling in the negative list so far as service tax is concerned.â
The High Court of Delhi Stayed Proceedings against Haj Group Organizers (HGOs) and held that Haj is not merely a holiday but a religious practice and faith. It was held that âalthough restrictions and conditions to the issuance of the Registration Certificate as well as to the Quota allotted to the petitioners/HGOs may be imposed, the same should not be held against the pilgrims who, in good faith, registered with the petitioners/HGOs to undertake the pilgrimage. This Court is of the view that such an action would defeat the purpose of the current Haj Policy and is in derogation of Article 25 of the Constitution of India.â
The Gujarat High Court, while dismissing the petition held that the Goods and Services Tax (GST) department can conduct search and seizure against a SEZ unit within its jurisdiction.
The two Judge Bench consisting of Justices Ashutosh Shastri and J. C. Doshi observed that this was an attempt on the part of petitioners by filing these kind of petitions to thwart and belay the legal proceedings which are initiated by respondent authorities and as such this move of petitioners appears to be an abuse of process of law looking to the manner in which the irregularities alleged to have been committed. Such an attempt on the part of petitioners deserved to be dealt firmly so that the litigants may not take disadvantage of the situation by bringing such kind of litigation. Records indicated that after issuance of notice, the petitioners did not cooperate and indicated to wait for the orders from the Court.
A Division Bench of the Delhi High Court ruled that Rule 89(4) of the Central Goods and Services Tax (CGST) Rules, 2017 is inapplicable to cases of refund of integrated tax paid on zero rated supply.
A Division Bench comprising Justices Vibhu Bakhru and Amit Mahajan observed that âThe opening sentence of Rule 89(4) of the CGST Rules makes it amply clear that it applies only in cases of zero-rated supply of goods or services, without payment of tax under bond or letter of undertaking. We find merit in the petitionerâs contention that Rule 89(4) of the CGST Rules is inapplicable to cases of refund of integrated tax paid on zero rated supply.â
In a recent ruling, a Single Bench of Justice Dr. Anita Sumanth of Madras High Court (HC) directed the customs officers to release the confiscated goods provisionally on the payment of enhanced customs duty. The Counsel of the petitioner confirmed categorically that enhanced duty will be remitted.
Also, the counsel made a prayer for waiver of demurrage, which may be addressed to the appropriate respondent for the consideration in accordance with law and applicable regulations. The Madras High Court set aside the impugned order and ordered the release of the goods provisionally within a period of two weeks from today on payment of enhanced duty.
The Madras High Court (HC) dismissed the Writ Petition (WP) by Bharat Heavy Electricals since the Commissioner of Goods and Service Tax (GST) dropped the proceeding. Bharat Heavy Electricals Ltd., the petitioner submitted that pending Writ Petitions, the impugned proceedings were continued by the respondent Assessing Authorities that have culminated in Orders-in-original dated 25.01.2023 and 23.05.2023, whereunder, the Commissioner of GST and Central Excise has dropped the proceedings initiated under impugned show cause notices bearing Nos.40/2011 dated 03.11.2011 and 2/2013 dated 16.01.2023.
The single-judge bench comprising Dr Justice Anita Sumanth observed that there was nothing further surviving in these matters and closed the Writ Petitions.
The Madras High Court (HC) has held that the rectification application under section 161 of the Goods and Service Tax Act, 2017 is not valid when the assessee failed to cooperate in the assessment. While dismissing the petition, the single-judge bench comprising Dr Justice Anita Sumanth observed that the Officer has set out in the impugned orders that the petitioner has not cooperated in the course of assessment, either originally or in the rectification sought.
A Division Bench of the High Court of Delhi upheld the penalty imposed on M/s Seville Products Limited for its involvement in customs duty evasion. The court dismissed the appeals filed by the appellant against the order of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT). The High Court of Delhi upheld the penalty imposed on M/S Seville Products Limited for customs duty evasion. The court, in result, affirmed the application of jurisdiction under Customs Act, rejected the appellantâs arguments against the proceedings, and upheld the findings of the Appellate Authority and the Tribunal. This decision serves as a reminder that overseas entities can be held liable under the Customs Act for their involvement in customs duty evasion within the territory of India.
In a recent ruling, a Division bench of the Delhi High Court has directed the adjustment of a refund against an income tax demand. Consequently, the High Court ordered the concerned authority to adjust the refund accordingly and emphasized that the authority should pass an appropriate order in this regard. The petitioner was granted liberty to seek an appropriate remedy if aggrieved by the decision on the application for stay, as per the law. The concerned authority was directed to dispose of the application for stay of demand at the earliest, not later than three weeks from the receipt of a copy of the judgment.
In a recent development in the Religare Finvest Ltd (RFL), the Delhi High Court has granted bail to ex-Fortis promoter Malvinder Mohan Singh and three others in a case of alleged misappropriation of funds of Religare Finvest Ltd (RFL) lodged by the Delhi Police. Considering the fact that the investigation is complete and the main chargesheet, as well as the supplementary chargesheets are filed before the Trial Court, the Court allowed the bail application.
The Delhi High Court quashed the investigation of Competition Commission of India (CCI) against the Institute of Chartered Accountants of India (ICAI) and observed that the CCI has no power to review the Continuing Professional Education (CPE) programme of the ICAI. The bench observed that there is no other body or institution, which is engaged in the activity of providing professional training to acquire the classification of a chartered accountant or for the continuing education program other than ICAI. Thus, it is not abusing its dominant position but discharging its statutory functions.
In a significant case of Dewan Housing Finance Corporation Ltd. (DHFL) , the Delhi High Court quashed the plea by the Central Bureau of Investigation (CBI) to quash the bail granted to the ex-promoter. While dismissing the petition, the Court viewed that the offence alleged against the accused persons are very serious and very high in magnitude and the material collected by the investigating agency was too short. The Court held that âmerely because cognizance has been taken, the right to statutory bail cannot be extended or defeated.â
The Allahabad High Court (HC) set aside the entry tax demand on Indian Made Foreign Liquor since it was not included in reversed Entry Act of 2007. Justice Piyush Agrawalobserved that in the schedule of items, Indian-made foreign liquor was not mentioned and therefore, proceedings initiated against the petitioner are without jurisdiction. The court directed the respondent to file a counter affidavit within four weeks. âTill the next date of listing, no coercive action shall be taken against the petitioner provided petitioner furnishes surety other than cash or bank guarantee to the satisfaction of Assessing Authority.â, the Court held.
In a significant case, the Rajasthan High Court held that the reduced rate of stamp duty is allowable to lease deeds on which rent is fixed and premium is not paid or delivered. The Court held that the respondent-Indus Tower Limited would be liable to pay stamp duty as per the provisions of the law, which were in force on the date of execution of lease deeds without claiming the benefit of the notification dated 05.03.2003.
A Single Bench of Madras High Court has held that providing opportunity of being heard to each and every member of the society was not necessary for proceedings under Section 34A of the Income Tax Act 1961. Since this Government Order had already been challenged before this Court and the said writ petitions were also pending consideration it was inappropriate for the court to take any decision.
The Madras High Court directed the petitioner, K Marimuthu, to approach statutory authority on the ground that there was delay in payment of service tax due to cancer. A Single Bench of the Madras High Court comprising noted that âThere is no doubt that the petitioner is ailing from cancer. It is also seen that due to the default in paying the service tax, the respondents have attached the bank account of the petitioner and the recovery notice has also been issued, challenging which, the petitioner is before the Court.â
âThis Court, considering the ailment of the petitioner, permits him to approach the statutory authority by way of within a period of eight weeks from the date of receipt of a copy of this order. However, it is made clear that the request made by the petitioner to release the bank attachment may be raised before the appellate authorityâ the Bench concluded.
The Madras High Court was directed to grant the opportunity of hearing regarding the provisional release of seized goods. A Single Bench of the Madras High Court of Justice PB Balaji observed that âIt would be just and equitable to direct the first respondent to pass orders on the petitionerâs application dated 19.04.2023, within a period of ten (10) days from today, after affording an opportunity of personal hearing to the petitioner, by putting the petitioner on advance notice so that the final orders are passed on his application within 10 days, without any further delay.â
The High Court of Karnataka has suspended the recovery of demand till the disposal of the appeal finding that the denial of exemption under Sections 11 and 12 of the Income Tax Act, 1961 was done without uploading prior notice to the assessee through the online portal.
The single bench of Justice S Sunil Dutt Yadav directed the respondents not to take any precipitative steps to recover the demand until the appeal is disposed of by the First Appellate Authority. The bench also instructed the authority to expedite the appeal hearing process. Accordingly, the petition is disposed of and the order is set aside subject to the observations made. The Two-member bench of Dr D.M. Misra and R. Bhagya Devi directed the adjudicating authority to verify the impugned order after affording an opportunity to the appellant to respond to the said objections.
The Tripura High Court has recently dismissed a criminal revision petition, upholding denial of discharge of the accused in a case where they were alleged to have demanded tax money in the name of an extremist group.
âAs such, this court after careful consideration of the submission of the parties, the materials placed on record and the reasons recorded hereinabove, is satisfied that the impugned order passed by the learned trial court dated 20.01.2023 rejecting the application for discharging the petitioners does not require any interference, in exercise of the inherent powers of the court under Section 482 of the CrPCâ, the Tripura High Court held.
The Rajasthan High Court directed to decide Goods and Services Tax (GST) refund application within 60 days in the matter of GST refund application pending for 9 months.
A Division Bench of the Rajasthan High Court comprising Justice Manindra Mohan Shrivastava and Justice Anil Kumar Upman observed that âAt this stage, we are inclined to dispose of the petition with a direction to the respondent no.2, Principal Commissioner, CGST and Central Excise Commissionerate to ensure that the application claiming refund filed by the petitioner before an Officer subordinate to him is decided within the outer limit of 60 days.â
In a recent decision the Delhi High Court has held that taxpayers filing declarations under the Sabka Vishwas (Legacy Dispute Resolution) Scheme Rules, 2019 (SVLDR Scheme) cannot quantify the duty under indirect taxes, thereby dismissing the writ petition filed by Ideal Broadcasting India Pvt Ltd.
The Bench concluded by noting that if the amount of duty claimed by the Department has not attained finality or has not been admitted by the declarant as recoverable from it, such case would have fallen under the âlitigation category whereas in the other situation where amount of duty has attained finality on account of appeal having been not filed before the expiry of the limitation period or the appellate order having attained finality or the amount of duty having been admitted by the declarant, that would fall under the âarrears category.
A Division Bench of the Delhi High Court confirmed the order of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) as no justifiable reasons were given for the delay in filing an appeal after defect notice.
The two member tribunal Bench comprising Justice Vibhu Bakhru and Justice Amit Mahajan observed that âThe CESTAT has, accordingly, concluded that there were no justifiable reasons for the delay in filing the appeal after the same was returned as defective. We find that the impugned order is well reasoned and cannot be faulted.â
The Punjab and Haryana High Court rejected the anticipatory bail application of Mandeep @ Monty, the petitioner in the matter as GST Registration was obtained in the name of a fictitious company.
A Single Bench comprising of Justice Jasjit Singh Bedi, observed that âIn the instant case, a perusal of the affidavits of the State would show the manner in which the investigation was conducted and the specific role played by the petitioner. In fact, he and his co-accused had set up a fictitious firm/companies and thereby cheated the government of crores of rupees.â âEven otherwise, recoveries of various documents are to be effected from the petitioner and the names of the real beneficiaries are to be revealed. Therefore, the custodial interrogation of the petitioner is certainly requiredâ the Bench concluded.
A Single Bench of the Madras High Court directed the Deputy Commissioner of Customs to consider re-export of Link Samahan without insisting the payment of import duties.
A Single Bench of the Madras High Court comprising Justice Senthil Kumar Ramamoorthy observed that âIn view of the said submission, the writ petition is disposed of by directing the respondent to consider the petitionerâs request for permission to re-export the goods and dispose of the request by a reasoned order within a period of 30 days from the date of receipt of a copy of this order.â
The Gauhati High Court (High Court of Assam, Nagaland, Mizoram, and Arunachal Pradesh) has dismissed the appeal observing that the burden of proof on seized goods that are not notified under Section 123(2) of Customs Act, 1962 lies not on the person from whose possession the goods were seized but with the Department of Customs. The Gauhati High Court found that the department had failed to establish beyond reasonable doubt that the betel nuts were smuggled goods. In conclusion, the appeal was dismissed without cost as being devoid of any merit.
The Rajasthan High Court has held that Pizza and Sandwich qualify as âCooked Foodsâ for claim of exemption beyond 5% Value Added Tax (VAT) and not ineligible for exemption as âBaked Branded Productsâ, allowing consequential relief to the assessee. In the opinion of this Court, both the authorities below have relied on extraneous, unsound, specious, and ill-founded factors and have therefore reached a perverse conclusion, the Single Bench of Justice Sameer Jain observed.
Answering the issue in favour of the petitioner-assessee and against the respondent-revenue, the SIngle Bench of Rajasthan High Court ruled that, ââpizzaâ and âsandwichesâ are held to be âcooked foodsâ, directing the revenue to grant consequential reliefs to the assessee within 90 days.
A Single Bench of the Chhatisgarh High Court directed the department to decide the appeal within 90 days since the Commissioner of Income Tax Appeal delayed considering the statutory appeal. Considering the limited grievance of the petitioners, Justice Rakesh Mohan Pandey directed the respondent No.2 i.e. Commissioner of Income Tax (Appeals) [CIT(A)] to consider and decide the pending appeals filed in Form No.35 within a further period of 90 days.
The Jharkhand High Court held that the Show Cause Notice under Section 74 of Jharkhand Goods and Services Tax Act, 2017 (JGST Act) is mandatory along with the Form GST DRC-01.
Accordingly, the Division bench observed that the foundation of the proceeding in both the cases suffers from material irregularity and hence not sustainable being contrary to Section 74(1) of the Jharkhand Goods and Services Tax Act; thus, the subsequent proceedings/impugned Orders cannot sanctify the same. The matter was remanded to the adjudicating authority to pass a fresh order in accordance with law from the stage of issuance of proper show cause notice under Section 74 (1) of the Jharkhand Goods and Services Tax Act.
Madras High Court in a recent case granted 3 week time for filing a statutory appeal, since the department not objected to condone the delay in filing an appeal. Mohana Murali, Senior Panel Counsel, who accepted the notice for R1, fairly does not object to the request, therefore the Court condoned the delay. The Single Bench of Dr Justice Anita Sumanth granted three weeks to file an appeal against the impugned order dated 28.09.2022.
The High Court of Jammu & Kashmir and Ladakh directed to allow 9% interest on the delayed amount of Reimbursement of Goods and Service Tax (GST) due to negligence of the tax officer. A division bench comprising Justice Atul Sreedharan and Justice Mohan Lal held that âthe petitioner is entitled to receive the budgetary support as already arrived at forthwith and the same should be released without any further delay.
At the same time on account of the delay caused by the Union territory of almost five years, the court imposed a penalty of 9% interest on the total amount due to the petitioner from 18.05.2017, till the date of payment which shall be paid by the Union Territory. The costs so imposed be recovered by the Union Territory from the Officers so identified on account of whose indolence, and delay in disbursing the reimbursement of GST has occurredâ.
In a writ petition to condone delay in the filing of the appeal, the Madras High Court directed the petitioner assessee to approach the appellate authority under Tamil Nadu Value Added Tax, 2006. A single-judge bench comprising Dr Justice Anita Sumanth held that the petitioner can approach the appellate authority to challenge the impugned orders passed under the Tamil Nadu Value Added Tax, 2006.
The Delhi High Court has held that the court cannot interfere with the matter of tender issued by the Steel Authority of India (SAIL). A two-judge bench comprising Chief Justice Satish Chandra Sharma and Justice Subramonium Prasad observed that the purpose of calculating net worth should be primarily left with the tender issuing authority and the evaluating committee and the Court cannot dictate how the net worth should be calculated unless the decision is contrary to law.
While dismissing the petition, the Court further held that âit cannot be said that the action of the Respondent in not considering deferred tax liability as a part of net worth and rejecting the bid of the Petitioner for not meeting the qualification criteria is so arbitrary that it would warrant interference by this Court under Article 226 of the Constitution of India.â
The Delhi High Court has recently allowed the petitioner to operate bank accounts provisionally attached by Goods and Services Tax (GST) Authorities as a year had passed since the provisional attachment.
It was further noted that, âThe petitioner has also filed a list of fifteen bank accounts including the bank accounts maintained with IndusInd Bank which were attached by separate orders passed on 20.04.2022. Mr. Singla fairly states that although the said bank accounts as set out in the Annexure P-62 of the petition, have been provisionally attached by the separate orders, the said orders have also ceased to be operative by efflux of time, by virtue of Section 83(2) of the CGST Act.â It was thus directed that, âthe concerned banks shall not obstruct operation of the bank accounts on account of the provisional attachment orders dated 20.04.2022.â
The Rajasthan High Court quashed the tax board order since the department failed to provide the classification of CAT cables under the General Entry of the Rajasthan Value Added Tax Act, 2003.
A single judge bench comprising Justice Sameer Jain observed that the revenue has utterly failed to adduce any evidence, technical or otherwise, to substantiate its claim that CAT-5 or CAT-6 cables are not covered in Part-A of Schedule IV to the RVAT Act which specifically deals with IT Products. While allowing the order court quashed and set aside the order of the Tax Board.
While entertaining the writ petition, the Gujarat High Court has ruled that land costs are not subject to Goods and Services Tax; rather, only the cost of building construction is subject to the tax.
The High Court in support of the Supreme Court case Mafatlal Industries Ltd. v/s Union of India observed that since the writ petitioner has really paid the tax burden and the tax was paid under protest as a result of the interim decision of the Court. Thus, the applicant should be given a refund. Central Govt to appeal SC against Karnataka HC Order quashing GST Notice of Rs. 21000 crores on Gamerskraft According to sources, the Central Government is considering filing an appeal before the Supreme Court of India against the decision of the Karnataka High Court quashing the Goods and Services Tax (GST) notice of Rs. 21,000 on Gameskraft.
It is anticipated that the GST Council would clarify the tax rates for online gambling at its upcoming meeting. It is expected that the report from the Group of Ministers on online gambling, horse racing, and casinos will be delivered, and hopefully accepted. Additionally, the online gaming industry now feels confident that the government will continue to impose an 18% GST rather than a 28% tax on gross gaming revenue thanks to the modified Finance Act of 2023 and IT Intermediary Amendment Rules.
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