Judgments
Customs, Excise and Service Tax Appellate Tribunal
Apollo Tyres Limited vs Commissioner of Central Excise, Customs and Service Tax
MANU/CS/0164/2024
19.04.2024
Customs
Equal penalty can be imposed only in a case where the duty has not been paid or short paid by reason of collusion or any willful mis-statement or suppression of fact
Present appeal is directed against order-in-original wherein the Appellant challenged only imposition of penalties of Rs. 68,74,072 imposed under Section 114A of the Customs Act, 1964.
The case relates to classification of the imported goods, the Appellant have classified the goods under CTH 38122090 on a bona fide belief that the imported goods were Plasticizer and the same were used as Plasticizer in the manufacture of the tyre. The compound Plasticizer is clearly mentioned in the tariff entry against CTH 38122090. Therefore, the bona fide belief of the Appellant that the product being a plasticizer classifiable under CTH 38122090 cannot be doubted. The appellant without contesting the duty liability paid the entire amount along with interest and seek relief only for waiver of penalty.
In all over India at all the Ports, said goods was being classified and accepted under CTH 38122090 considering the same as plasticizer. Therefore, it is not only belief of the Appellant but also the view of the department that the goods is classifiable under CTH 38122090. However, it could only be ascertained that the good is classified under CTH 27079900 after detailed analysis of the product. Therefore, in facts and circumstances of the case, the penalty under Section 114A of Act cannot be imposed.
From the plain reading of the Section 114A, it can be seen that the equal penalty can be imposed only in a case where the duty has not been paid or short paid by reason of collusion or any willful mis-statement or suppression of fact. In the present case, it is absolutely clear that non-payment of duty on the part of the appellant is not by reason of suppression of fact, collusion or any willful misstatement. Therefore, the ingredients for imposing penalty under Section 114A are absent. Therefore, the penalty under Section 114A cannot be imposed. The duty demand along with interest and payment thereof are upheld and maintained. The penalty imposed under Section 114A is set aside. Appeal allowed.
Tags : Penalty Imposition Legality
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Customs, Excise and Service Tax Appellate Tribunal
Akshoy Kumar Ghosh And Sons vs. Commissioner of Central Excise & Service Tax
MANU/CK/0106/2024
19.04.2024
Service Tax
Reimbursable expenses are not includible in the taxable value of services
The Appellant is in appeal against the impugned order wherein the demand of service tax has been raised on account of non-inclusion on reimbursable expenses incurred by the Appellant in taxable services.
The Appellant has claim that they are the pure agents. In support of their claim, the Appellant has filed various agreement with their Principal, which shows that the appellant is the pure agent and all the expenses of Principal are for taking and delivery of the goods, for making payment for transportation, freight of clearing and forwarding services for the purposes of agency. All the charges paid are to be reimbursed to the appellant on actual basis as the appellant is a pure agent.
The Appellant is only pure agent and all the expenses for transportation, loading and un-loading etc. paid by the Appellant were reimbursed from the Principal on actual basis. The Appellant is not required to include the reimbursable expenses in their taxable services.
Moreover, the present issue whether the reimbursable expenses are includable in the taxable value or not, has been examined by this Tribunal in the case of Ganga Carrier Private Limited.As this Tribunal has already held that, the reimbursable expenses are not includible in the taxable value of services, therefore, present Tribunal hold that the reimbursable expenses in this case, are also not includable in the taxable value of service. Therefore, the Appellant has correctly paid the service tax during the impugned period. Consequently, no demand of differential service tax is sustainable against the appellant. There is no merit in the impugned order and the same is set aside. Appeal allowed.
Tags : Demand Confirmation Legality
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Supreme Court
The State of Madhya Pradesh Vs. Satish Jain (Dead) by L.Rs. and Ors. (Neutral Citation: 2024 INSC 315)
MANU/SC/0319/2024
18.04.2024
Civil
When the very basis of entering into the agreement have been set aside, agreement itself can’t be relied upon by any of the parties
The Appellant-State of Madhya Pradesh-Defendant in the Original Suit filed by Satish Jain (Respondent No. 1), since deceased, represented by his legal heirs, is in appeal assailing the correctness of the judgment and order passed by the High Court allowing Civil Revision, whereby the High Court set aside the order of the Trial Court, and further directed the Trial Court to proceed in accordance with law to implement the award of the Arbitrator. It also rejected the objections of the Appellant, and further the order rejecting the report of the Arbitrator was also set aside.
It is an admitted position that, the suit is still pending before the Trial Court. The Plaintiff has not been granted any declaration as such till date. The ex-parte decree having been set aside, there was no occasion for the Plaintiff to further act upon the agreement dated 30th July, 1991 since no rights had crystallized to the parties. The basis of that agreement was the ex-parte decree of declaration and injunction in favour of the Plaintiff. Once the ex-parte decree has itself been set aside and the suit was to proceed further from the stage of filing of written statement by the Appellant- State, the agreement dated 30th July, 1991 would lose all its credibility assuming there was any semblance of any right to enter into the agreement.
The application filed by BMC under Section 89 of Code of Civil Procedure, 1908 (CPC) was also not maintainable based on the agreement of 30th July, 1991. There appears to be some kind of collusion between BMC and the Plaintiff. Whether or not there was any condition in the agreement dated 30th July, 1991 for appointment of Arbitrator, the very basis of entering into the agreement having been set aside, the agreement itself could not have been relied upon by any of the parties.
A perusal of the agreement dated 30th July, 1991 clearly mentions that the Plaintiff was claiming right under the ex-parte decree dated 22nd June, 1990 and the dismissal of the First Appeal on 11th May, 1991. Later on, when both the orders had been set aside and the suit itself was to proceed from the stage of the Appellant-State filing its written statement, the agreement itself would not have any sanctity in the eye of law even inter se parties. The right created in the Plaintiff under the ex-parte decree stood extinguished and, therefore, BMC ought to have been careful enough of not placing any reliance any further on the said agreement. The Trial Court was justified in allowing the application by setting aside the award.
The High Court committed a grave error in not considering the relevant aspects and in placing reliance on the statement made by the Appellant-State before the Trial Court that the State had no interest as it had allotted the land to BMC to set up a bus stand. The impugned order passed by the High Court is set aside. Appeal allowed.
Tags : Award Implementation Legality
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Supreme Court
Sandeep Kumar Vs. GB Pant Institute of Engineering and Technology, Ghurdauri and Ors. (Neutral Citation: 2024 INSC 309)
MANU/SC/0309/2024
16.04.2024
Service
Termination of services of an employee without holding disciplinary enquiry violates principles of natural justice
Instant appeals are directed against the judgments passed by the High Court.The High Court, vide judgment dismissed the Writ Petition filed by the Appellant for assailing the order passed by Respondent No. 2 terminating the services of the Appellant on the post of Registrar of Respondent No. 1- G.B. Pant Institute of Engineering and Technology ('Institute').
On a bare perusal of the termination letter dated 19th May, 2022, it becomes apparent that the decision to terminate the services of the Appellant from the post of Registrar was not preceded by an opportunity to show cause or any sort of disciplinary proceedings. The enquiry as referred to in the termination letter was in relation to the qualifications of the Appellant for being appointed on the post of Registrar. The letter further indicates that the selection to the post of Registrar was not approved by the Board of Governors in its 26th meeting dated 16th June, 2018. The said observation in the letter dated 19th May, 2022 is totally erroneous and contradicted by the minutes of the meeting dated 16th June, 2018.
The termination of the services of the Appellant without holding disciplinary enquiry was totally unjustified and dehors the requirements of law and in gross violation of principles of natural justice. Hence, the learned Division Bench of the High Court fell in grave error in dismissing the writ petition filed by the Appellant on the hypertechnical ground that the minutes of 26th meeting of the Board of Governors dated 16th June, 2018 had not been placed on record.
The impugned judgments passed by the High Court are quashed and set aside.The order whereby, the services of the Appellant on the post of Registrar of the Institute were terminated is also declared to be illegal and as a consequence, the same is quashed and set aside.Appellant shall forthwith be reinstated on the post of Registrar of G.B. Pant Institute of Engineering and Technology. Appeals allowed.
Tags : Termination Natural justice Violation
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High Court of Delhi
Tejo Ratna Kongara Vs. National Housing Bank and Ors. (Neutral Citation: 2024:DHC:3053)
MANU/DE/2845/2024
16.04.2024
Company
Writ jurisdiction of the Court cannot be used by a party for collecting evidence and documents against another party
The present petition has been filed seeking directions against the Respondent no. 1/National Housing Bank ("NHB") to consider and decide upon the Petitioner's representation with further prayer for direction to Respondent no. 1 to call upon Respondent no. 2, i.e., India Bulls Housing Finance Limited ("IBHFL") to produce the responses and relevant documents, disclosing the actions taken by them in respect of the query dated 6th April, 2023 addressed by the Petitioner.
Writ jurisdiction of this Court cannot be used by a party for collecting evidence and documents against another party, against whom the petitioner has pending disputes. Writ jurisdiction is meant to safeguard the constitutional, legal and vested rights of a party. The powers vested with this Court under writ jurisdiction are large that are used by this Court to ensure that the constitutional and legal rights of parties are protected and secured.
The Court process, much less a writ jurisdiction, cannot be used as a fishing and roving enquiry against a party with whom the Petitioner has pending disputes, for the purposes of collecting evidence and documents to be used against such a party. The present petition filed by the petitioner is clearly a misuse and abuse of the process of the Court.
It is clear that, the Petitioner is trying to collect evidence and documents against IBREL, as is manifest from the representation dated 18th August, 2023 submitted by the petitioner to NHB. Neither any constitutional nor any legal right of the Petitioner is being violated or breached, for protection of which the present petition has been filed. This Court will not become a party in a fact finding and evidence collecting process in order to aid the Petitioner, which is the manifest purpose of filing the present petition. The present petition is clearly a misuse and abuse of the process of law. There is no merit is found in the present petition. Petition dismissed.
Tags : Documents Production Direction
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High Court of Delhi
M. Tech Developers Pvt. Ltd. Vs. National Faceless Assessment Centre and Ors. (Neutral Citation: 2024:DHC:2921-DB)
MANU/DE/2865/2024
15.04.2024
Insolvency
Once the Resolution Plan came to be duly accepted, the bar created in terms of Section 31 of the IBC would apply
The Petitioner impugns notices issued under Section 144B of the Income Tax Act, 19611 pertaining to Assessment Year 2021-22 dated 27 June 2022 as well as the consequential notices issued under Sections 143(2) and 142(1) of the Act.
The challenge is essentially mounted on the basis of Section 31 of the Insolvency and Bankruptcy Code, 2016, with the Petitioner contending that,once the Resolution Plan came to be duly accepted, the bar created in terms of Section 31 of the IBC would apply, and bearing in mind the decision of the Supreme Court in Ghanashyam Mishra and Sons Pvt. Ltd vs. Edelweiss Asset Reconstruction Company Ltd., the Respondents would stand deprived of the jurisdiction or authority to reopen or assess income for any period prior to the approval of the Resolution Plan.
The proceedings before the National Company Law Tribunal commenced upon the filing of a petition under Section 7 of the IBC by Debashish Majumdar. The petition came to be admitted on 12 November 2020 and an order of moratorium came into effect from that date. In terms of the statutory scheme of the IBC, the Corporate Insolvency Resolution Process would also be deemed to have commenced from the aforesaid date.
According to the writ petitioner, the Resolution Professional appointed pursuant to the commencement of CIRP, on 23 November 2020, informed the Income Tax authorities of the pendency of proceedings before the NCLT. This was followed by a communication dated 28 January 2021 in terms of which the RP is stated to have conveyed a request to the Income Tax authorities to lodge their claims in accordance with the provisions of the IBC.
The Petitioner, in terms of the provisions of the Act, furnished its Return of Income for AY 2021-22 on 10 March 2022 declaring a net loss of INR 9,47,64,300. The CIRP proceedings in the meanwhile culminated in the approval of the Resolution Plan being approved by the NCLT on 15 March 2022 and accepting a plan submitted by Sarthi Constructions which had been accepted by the Committee of Creditors. It is only thereafter and on 27 June, 2022 that the Respondents chose to commence proceedings referable to Section 144B of the Act.
The fact that a Resolution Plan once approved would bring the curtains down on any claims pertaining to a period prior to the approval of the RP is no longer res integra.Section 144B power entails proceedings for assessment, reassessment or re-computation being initiated in terms of the faceless procedure of assessment as prescribed therein. Any effort to assess, reassess or re-compute could tend to lean towards a re-computation of liabilities which otherwise stands freezed by virtue of the Resolution Plan having been approved.
Such an action or recourse would clearly be barred by Section 31 of the IBC which binds all creditors of the corporate debtor, including the Central and State Governments or any other local authority to whom a debt is owed. Upon commencement of CIRP, the petition is duly advertised in terms of the provisions made in Regulation 6 of the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 and which would thus constitute due public announcement. The Respondents, therefore, cannot sustain the invocation of Section 144B based on their own failure to lodge a claim within the time stipulated.The impugned notices are quashed. Petition allowed.
Tags : Notices Issuance Legality
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