Issues: Whether an addition for alleged on-money receipt based on material obtained in a third-party search could be made in a regular assessment under section 143(3), instead of proceeding under section 153C.

Analysis: The addition was founded on information and documents arising from search proceedings concerning a third party. Where material found during such search is relied on to assess another person, the statutory procedure under section 153C, including recording the requisite satisfaction, must be followed. A regular assessment under section 143(3) could not sustain an addition founded on third-party search material when the searched person had been assessed under the search-assessment regime.

Conclusion: The addition of Rs. 37,00,000 under section 69A was unsustainable and was directed to be deleted, in favour of the assessee.

Issues: (i) Whether the value of the exported goods declared by the Appellant No.1 was rightly rejected by the authorities below on the ground of overvaluation? (ii) Whether a separate personal penalty can be legally sustained against Appellant No.2 (the partner) when a penalty has already been imposed upon the partnership firm for the same offense?

Issue (i): Whether the value of the exported goods declared by the Appellant No.1 was rightly rejected by the authorities below on the ground of overvaluation?

Analysis: The parallel or pro-forma invoices relied upon did not concern the disputed export consignment and related to other consignments or earlier periods. No contemporaneous export-price comparison or market inquiry was undertaken, and there was no evidence of financial flow-back from the overseas buyer. The declared transaction value could not therefore be rejected on extraneous invoices without cogent evidence of manipulation. Although past generation of parallel/pro-forma invoices warranted retention of the original penalty on the firm, the enhanced penalties were excessive in view of the failure of the overvaluation charge for the specific consignment.

Conclusion: The declared export value was not liable to be rejected for overvaluation. The redemption fine and enhanced penalty under Section 114AA were set aside, while the original penalty of Rs.50,000 under Section 114 on the firm was sustained.

Issue (ii): Whether a separate personal penalty can be legally sustained against Appellant No.2 (the partner) when a penalty has already been imposed upon the partnership firm for the same offense?

Analysis: A partnership firm is not a legal entity distinct from its partners for this purpose. Imposition of penalty on both the firm and its partner for the same infraction amounts to double punishment.

Conclusion: Separate penalties on the partner under Sections 114 and 114AA were legally unsustainable and were set aside.

Final Conclusion: The monetary consequences of the alleged overvaluation were substantially removed, with only the original penalty on the partnership firm retained.

Ratio Decidendi: Declared export value cannot be discarded on unrelated parallel invoices without contemporaneous valuation evidence or proof of manipulation, and a partner cannot be separately penalised where the partnership firm has already been penalised for the same infraction.

Issues: (i) Whether a pre-deposit of 7.5% of the drawback amount was required where the claimed drawback had not been disbursed to the exporter; (ii) Whether rejection of FOB value, denial of drawback and imposition of confiscation consequences and penalties could be sustained for 63 shipping bills solely on the investigation concerning 35 other shipping bills.

Issue (i): Whether a pre-deposit of 7.5% of the drawback amount was required where the claimed drawback had not been disbursed to the exporter.

Analysis: Since no drawback amount was received by the exporter, there was no amount requiring pre-deposit. The appellate authority had in any event proceeded to decide the matter on merits.

Conclusion: No pre-deposit of 7.5% of the unreceived drawback was required, in favour of the assessee.

Issue (ii): Whether rejection of FOB value, denial of drawback and imposition of confiscation consequences and penalties could be sustained for 63 shipping bills solely on the investigation concerning 35 other shipping bills.

Analysis: The proceedings for the 63 shipping bills rested entirely on the investigation concerning the 35 shipping bills, with no independent enquiry for the former exports. The foundational findings in relation to the 35 shipping bills had already been set aside because the exporter received foreign remittances equal to the declared FOB value, the departmental costing lacked reliable evidentiary basis, and no flowback of consideration was established. The same basis could not sustain the present demand.

Conclusion: Rejection of the FOB value, denial of drawback and the associated penalties and confiscation consequences were legally unsustainable, in favour of the assessee.

Final Conclusion: The demand and adverse findings founded solely on the earlier investigation could not survive after the underlying valuation allegation had failed.

Ratio Decidendi: Where proceedings concerning export valuation are founded solely on an investigation whose material findings have been set aside, and no independent enquiry supports the later exports, the consequential demand and penalties are unsustainable.

Issues: (i) Whether votes cast "for, with modification" could be counted as unconditional assent toward the statutory majority required for sanction of the Revival Scheme; (ii) Whether sanction satisfied the statutory safeguards of informed stakeholder approval and fairness where individual objections and material disclosures were not substantively examined.

Issue (i): Whether votes cast "for, with modification" could be counted as unconditional assent toward the statutory majority required for sanction of the Revival Scheme.

Analysis: Section 391(2) requires the prescribed majority to agree to the arrangement ultimately presented for sanction. A vote cast subject to modifications is conditional assent, and its legal effect must be determined where the modifications concern substantive contractual and financial rights. Commercial wisdom becomes relevant only after valid statutory assent to the actual scheme is established.

Conclusion: Conditional votes could not be aggregated with unconditional votes as approval of the sanctioned Revival Scheme without determining the legal effect of the attached modifications. This issue was decided in favour of the appellants.

Issue (ii): Whether sanction satisfied the statutory safeguards of informed stakeholder approval and fairness where individual objections and material disclosures were not substantively examined.

Analysis: Sections 391 to 393 require adequate material for stakeholders to take an informed decision and require the scheme to be just, fair and reasonable to the class as a whole. Numerical support cannot replace scrutiny of whether the scheme sanctioned reflected the arrangement assented to, whether affected contractual rights were adequately addressed, and whether substantive objections of individual allottees were examined.

Conclusion: The statutory safeguards of informed approval and fairness were not shown to have been satisfied, rendering the sanction unsustainable. This issue was decided in favour of the appellants.

Final Conclusion: A revival arrangement can bind stakeholders only where statutory assent to the actual arrangement is established through an informed and fair approval process.

Ratio Decidendi: A company-compromise scheme cannot be sanctioned by treating conditional votes as unconditional statutory assent without determining the effect of the conditions and ensuring informed, fair approval by the affected class.

Issues: Whether corporate guarantees issued by an assessee for credit facilities availed by its subsidiaries or associates, without charging commission or interest, are taxable under the service-tax regime as Banking and Other Financial Services.

Analysis: Taxability requires a service provider, service recipient, taxable service and consideration. The admitted absence of any commission or interest for issuing the corporate guarantees meant that no consideration flowed to the assessee. Corporate guarantees were not specifically included within Banking and Other Financial Services, and the provision governing valuation could not be used to create or deem consideration where none existed. Non-monetary benefits relevant to valuation do not establish the essential element of consideration necessary for a taxable service. The contrary authority relied upon by Revenue was inapplicable.

Conclusion: Corporate guarantees issued without consideration are not chargeable to service tax; the demands, interest and penalties cannot be sustained.

Issues: Whether service tax was payable on amounts received by the appellant as its share of rent from associate entities for residential premises used by their common employees/directors.

Analysis: The appellant was neither the owner of the properties nor shown to have sublet them. The material, including water and electricity bills, established that the premises were residential and had been taken on lease or rent for residential use by common employees/directors. The amounts received from associate entities represented only their share of the rent. No material established use of the premises for commerce or business, which was necessary for taxability under the renting-of-immovable-property service. The disputed levy and its retrospective amendment also supported the appellant's bona fide belief that tax was not payable.

Conclusion: Amounts received as shared rent for residential premises not used for commerce or business were not liable to service tax; the issue was decided in favour of the assessee.

Issues: Whether service tax is leviable on corporate guarantees furnished to associated enterprises without any consideration.

Analysis: Levy of service tax requires a taxable service and consideration received for providing it. The record established that no commission, fee, interest or other consideration was charged by the respondent for the corporate guarantees. A notional amount based on prevailing market rates for bank guarantees could not be treated as taxable consideration. The authority relied upon by Revenue concerned corporate guarantees for which commission or other consideration had actually been received and was therefore inapplicable.

Conclusion: Corporate guarantees provided without consideration are not liable to service tax; the dropping of the demand was sustained in favour of the assessee.

Issues: (i) Whether service tax was payable on the amount received as advances towards sale of plots and subsequently returned to buyers; (ii) Whether penalty could be imposed where service tax and interest on receipts from construction of residential flats had been paid before issuance of the show-cause notice.

Issue (i): Whether service tax was payable on the amount received as advances towards sale of plots and subsequently returned to buyers.

Analysis: The amount received against sale of plots was returned because construction of residential towers was not viable, and the return was supported by documentary material including the income-tax assessment order. The receipts were not consideration for a taxable service. Independently, advances received in connection with sale of plots constituted receipts relating to sale of immovable property and fell outside the definition of service under Section 65B(44)(a)(i) of the Finance Act, 1994.

Conclusion: No service tax was payable on Rs.30,71,62,950 received towards sale of plots and returned to buyers; the related demand was set aside in favour of the assessee.

Issue (ii): Whether penalty could be imposed where service tax and interest on receipts from construction of residential flats had been paid before issuance of the show-cause notice.

Analysis: Service tax of Rs.1,31,62,646, including interest, on receipts of Rs.27 crores from construction of residential flats had been paid before the show-cause notice, and that payment was admitted in the notice and impugned order. Section 73 of the Finance Act, 1994 does not require issuance of a notice to demand tax already paid with interest before its issuance.

Conclusion: The paid service-tax demand and interest were confirmed, but no penalty was imposable; the penalty was set aside in favour of the assessee.

Final Conclusion: The disputed levy on returned plot-sale advances and the penalty on the pre-notice payment were annulled, while the tax and interest already discharged on construction receipts remained accepted.

Ratio Decidendi: Amounts received for sale of immovable property and returned to purchasers do not constitute consideration for a taxable service; where tax and interest are paid before the show-cause notice, penalty is not sustainable.

Issues: (i) Whether the appeal concerning invocation of extended limitation, where valuation of body-built vehicles is involved, was maintainable under Section 35L; (ii) Whether the assessable value of the body-built vehicle had to include the 10% addition forming part of the chassis value under Rule 8; (iii) Whether the extended limitation under the proviso to Section 11A could be invoked for the demand.

Issue (i): Whether the appeal concerning invocation of extended limitation, where valuation of body-built vehicles is involved, was maintainable under Section 35L.

Analysis: The limitation dispute arose from the alleged non-inclusion of a component of the chassis value in determining the assessable value of the completed vehicle. Since valuation for assessment was the core subject of the show-cause notice, the controversy had an inextricable connection with valuation of goods. Relegating the matter after prolonged pendency was unwarranted.

Conclusion: The appeal was maintainable under Section 35L of the Central Excise Act, 1944.

Issue (ii): Whether the assessable value of the body-built vehicle had to include the 10% addition forming part of the chassis value under Rule 8.

Analysis: The chassis had been cleared to the job worker on a statutorily determined value of 110% of its manufacturing cost under Rule 8. On clearance of the completed vehicle, the value of the intermediate chassis, including that 10% addition, formed part of the cost on which duty had been paid and credit utilised. The exclusion recognised for a manufacturer's anticipated post-manufacture sale profit and post-clearance expenses did not permit exclusion of the 10% embedded in the chassis value.

Conclusion: The 10% addition included in the chassis valuation under Rule 8 had to be included in the assessable value of the body-built vehicle; this issue was against the assessee.

Issue (iii): Whether the extended limitation under the proviso to Section 11A could be invoked for the demand.

Analysis: Invocation of the extended period requires fraud, collusion, wilful misstatement, wilful suppression, or contravention with intent to evade duty. The Department knew that the manufacturer had valued the chassis at 110% of manufacturing cost. Where relevant facts are known to both sides, an omission by the assessee does not amount to wilful suppression. The demand period preceded the show-cause notice beyond the normal one-year limitation.

Conclusion: The proviso to Section 11A could not be invoked; the demand was time-barred. This issue was in favour of the assessee.

Final Conclusion: Although the valuation component was legally includible, recovery for the relevant period was barred by limitation, and the orders sustaining the demand were set aside.

Ratio Decidendi: Extended limitation for excise duty can be invoked only upon a wilful act intended to evade duty; omission does not constitute suppression where the material facts were already known to the Department.

Issues: Whether Cenvat credit on telephone services could be denied because invoices were issued in the name of the head office, which was not registered as an Input Service Distributor.

Analysis: During the relevant period, non-registration of the head office as an Input Service Distributor did not bar credit where the input services were received and used by the assessee. The omission to obtain such registration was a procedural irregularity, particularly where there was no requirement for proportionate distribution of credit and no undue benefit or revenue loss resulted.

Conclusion: Cenvat credit could not be denied merely because the invoices stood in the head office's name and the head office lacked Input Service Distributor registration; the issue was decided in favour of the assessee.

Issues: Whether summons and cheque-dishonour complaints could be sustained against a former director under the statutory vicarious-liability provision despite absence of specific allegations concerning his role and his resignation before issuance of the cheques.

Analysis: Vicarious criminal liability for an offence by a company does not arise merely from a person's designation as a director. The complaint must contain specific assertions showing that, at the time of the offence, the individual was in charge of and responsible for the conduct of the company's business, or that the offence occurred through that individual's consent, connivance or neglect. Generalised assertions were insufficient; the complaints contained no specific allegation concerning the petitioner's role, and he had not signed any cheque. Statutory corporate records conclusively established that he had ceased to be a director before the cheques were issued and dishonoured. Continuing proceedings in those circumstances would be vexatious and an abuse of process.

Conclusion: The petitioner could not be subjected to vicarious liability for the alleged cheque-dishonour offences, and the summoning orders and complaints against him were liable to be quashed.

Issues: Whether the substituted proviso to Section 107(6) governing pre-deposit applies to appeals arising from show-cause notices issued before 01.10.2025.

Analysis: The show-cause notices initiating the adjudicatory proceedings were issued in 2020. The applicable appellate pre-deposit regime is determined by the provision in force when those proceedings commenced; consequently, the later substituted proviso does not govern the proposed appeals.

Conclusion: The pre-deposit requirement for the appeals shall be governed by Section 107(6) as it stood when the respective show-cause notices were issued, and not by the proviso substituted with effect from 01.10.2025.

Issues: (i) Whether the period spent in pursuing refund and amendment proceedings could be excluded on the principles underlying Section 14 of the Limitation Act, 1963 for determining limitation of the statutory appeals; (ii) Whether the appeal against the assessment dated 06.05.2019 was barred by limitation.

Issue (i): Whether the period spent in pursuing refund and amendment proceedings could be excluded on the principles underlying Section 14 of the Limitation Act, 1963 for determining limitation of the statutory appeals.

Analysis: At the time the refund applications were instituted, binding jurisdictional law treated a refund under Section 27 of the Customs Act, 1962 as an independent remedy without a prior challenge to assessment. The subsequent decision requiring modification of the assessment before refund fundamentally altered that legal position. The importer promptly sought amendment under Section 149 of the Customs Act, 1962 and pursued the refund proceedings without negligence or inaction.

Analysis: Although a period preceding institution of an original proceeding is ordinarily not excludable under the principles stated in Section 14, the earlier period could not be treated as ordinary inaction where the importer had acted under the then binding jurisdictional position. The period up to 02.06.2020 was excludable on the peculiar transitional facts. The resulting limitation period was further covered by the statutory extension under Section 6 of the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 and Notification G.S.R. 601(E) dated 30.09.2020; hence the appeals filed on 31.08.2020 were timely.

Conclusion: The benefit of the principles underlying Section 14 was available, and the statutory appeals were within limitation. This issue is decided in favour of the assessee.

Issue (ii): Whether the appeal against the assessment dated 06.05.2019 was barred by limitation.

Analysis: The appeal was filed within twenty-eight days of the out-of-charge date and therefore fell within the prescribed period under Section 128 of the Customs Act, 1962.

Conclusion: The appeal was not barred by limitation. This issue is decided in favour of the assessee.

Final Conclusion: The limitation objections cannot preclude adjudication of the restored matters on their merits.

Issues: Whether GST on services rendered by an Advocate acting as an Insolvency Professional is payable under the reverse charge mechanism applicable to legal services or under the forward charge mechanism.

Analysis: Section 9(1) of the Central Goods and Services Tax Act, 2017 establishes forward charge as the default mechanism, while Section 9(3) permits reverse charge only for notified categories. Notification No. 13/2017-Central Tax (Rate) dated 28.06.2017, as corrected on 25.09.2017, applies reverse charge to legal services supplied by advocates. Insolvency Professionals, however, are independently regulated under the Insolvency and Bankruptcy Code, 2016 and the Insolvency and Bankruptcy Board of India (Insolvency Professionals) Regulations, 2016. Their functions in conducting insolvency resolution are distinct from conventional legal services.

Analysis: Under the Scheme of Classification of Services, insolvency and receivership services fall under the specific service classification 998241, separately from legal services under classification 99821. The specific classification of insolvency and receivership services prevails over the general classification of legal services. The nature and capacity in which the service is supplied, rather than the supplier's underlying professional qualification or enrolment as an advocate, determine the applicable GST treatment.

Conclusion: Services rendered by an Advocate in the capacity of an Insolvency Professional are insolvency and receivership services subject to the forward charge mechanism. The Advocate must obtain GST registration and furnish GST-compliant invoices for such services; reverse charge continues to apply only to legal services rendered in the capacity of an Advocate.

Ratio Decidendi: Where a service supplied by an advocate is specifically classified as insolvency and receivership service, its GST treatment is governed by that specific classification and not by the reverse charge mechanism applicable to legal services.

Issues: (i) Whether the personal guarantee covered the renewed credit facilities sanctioned on 12.04.2018; (ii) Whether the guarantor's liability was confined to Rs. 40 crore exclusive of interest.

Issue (i): Whether the personal guarantee covered the renewed credit facilities sanctioned on 12.04.2018.

Analysis: The guarantee deed was continuing in nature and remained operative until the outstanding dues were paid. The renewal of the credit facility at the existing level was also signed by the guarantor on 12.04.2018.

Conclusion: The guarantee extended to the renewed credit facilities. The finding is against the guarantor.

Issue (ii): Whether the guarantor's liability was confined to Rs. 40 crore exclusive of interest.

Analysis: The guarantee fixed the principal limit at Rs. 40 crore but expressly provided for interest at 12.70% per annum, or such rate as notified by the bank, from the date of demand.

Conclusion: The liability was not limited to Rs. 40 crore exclusive of contractual interest. The finding is against the guarantor.

Final Conclusion: The admission of the personal guarantor insolvency application warranted no appellate interference.

Ratio Decidendi: A continuing personal guarantee covering a specified principal amount together with stipulated interest remains enforceable for renewed facilities where the guarantor has assented to the renewal.

Issues: Whether the delay in filing the statutory appeal could be condoned to enable adjudication on merits.

Analysis: Although the Appellate Authority is bound by the limitation framework under Section 107, the stated circumstances preventing timely filing were beyond the assessee's control. Refusal to permit adjudication on merits would cause grave prejudice. The delay of 95 days, reckoned after the available statutory relaxation, was therefore fit to be condoned.

Conclusion: The delay in filing the appeal was condoned, and the assessee was permitted to file a fresh appeal for adjudication on merits in accordance with law.

Issues: Whether GST could be imposed under the assessment order on invoices relating to Motor Spirit and High-Speed Diesel asserted to be non-GST goods.

Analysis: Registration records and invoices placed on record indicated that the petitioner dealt in petroleum products. Motor Spirit and High-Speed Diesel were treated as non-GST items, while the assessment appeared to have imposed GST on such items. The resulting jurisdictional defect went to the root of the assessment and justified interference, while leaving fresh determination on the supporting documents and reply to the show-cause notice.

Outcome: The assessment order was set aside and the matter was sent for fresh determination after affording a personal hearing.

Issues: Whether notional rental income from unsold flats held as stock-in-trade was assessable under the head "Income from house property".

Analysis: Section 22 of the Income-tax Act, 1961 excludes property occupied for business or profession. The assessee had consistently treated project units, including unsold flats, as stock-in-trade; actual rent from let-out units had been offered and accepted as business income. The unsold units were stated to be used as scheme offices, material stores and sample flats. The addition was made on an ad hoc basis, and despite finding the computation unsupported by proper enquiry, the appellate authority directed fresh benchmarking without conducting verification or confronting the assessee on the alleged absence of evidence. No comparable addition had been made or sustained in other assessment years.

Conclusion: The addition of notional rental income from unsold units under Sections 22 and 23 could not be sustained, in favour of the assessee.

Issues: (i) Whether a common or consolidated show-cause notice may cover multiple financial years; (ii) Whether the appellate order was invalid for denial of an opportunity of hearing on the merits of the appeal.

Issue (i): Whether a common or consolidated show-cause notice may cover multiple financial years.

Analysis: Sections 73 and 74 of the Central Goods and Services Tax Act, 2017 do not prohibit a show-cause notice from covering multiple financial years. The contrary basis on which the writ petition had been allowed could not be sustained.

Conclusion: A common or consolidated show-cause notice covering multiple financial years is maintainable, in favour of the Revenue.

Issue (ii): Whether the appellate order was invalid for denial of an opportunity of hearing on the merits of the appeal.

Analysis: The record of personal hearing showed that the hearing was confined to condonation of delay and included a request for admission of the appeal and a merits hearing. The appeal was decided without affording a hearing on merits, contrary to principles of natural justice.

Conclusion: The appellate order is invalid for breach of principles of natural justice and the assessee must be afforded a merits hearing, in favour of the assessee.

Final Conclusion: The legal validity of consolidated notices for multiple financial years is affirmed, while the appellate adjudication requires reconsideration after a proper merits hearing.

Ratio Decidendi: In the absence of a statutory prohibition, a GST show-cause notice may validly consolidate multiple financial years; however, an appellate decision rendered without a hearing on merits violates principles of natural justice.