Issues: Whether tender fee collected for supplying tender documents is consideration for a taxable service liable to service tax.

Analysis: Service tax under Section 65B(44) of the Finance Act, 1994 requires an identifiable service provided for consideration. The prescribed tender fee was the cost of supplying tender documents and constituted sale or supply of documents, rather than a service rendered to bidders. A tender is merely an invitation to offer and does not create a contractual service arrangement between the tendering authority and every purchaser of tender documents.

Conclusion: Tender fee collected towards supply of tender documents is not consideration for a taxable service and is not liable to service tax; decided in favour of the assessee.

Issues: Whether the extended period of limitation could be invoked for recovery of service tax from a subcontractor where conflicting decisions had created uncertainty about the subcontractor's tax liability after payment of tax by the main contractor.

Analysis: The substantive tax liability of a subcontractor stood settled by the Larger Bench decision. However, prior conflicting Tribunal decisions had generated genuine uncertainty on whether a subcontractor was independently liable where the main contractor had paid service tax. This acknowledged confusion supported the appellant's bona fide belief and precluded invocation of the extended limitation period under Section 73(1) of the Finance Act, 1994. The normal limitation period remained unaffected.

Conclusion: The extended-period demand and the penalty under Section 78 of the Finance Act, 1994, were set aside; the demand for the normal period and the penalty under Section 72 of the Finance Act, 1994, were sustained. The issue was decided partly in favour of the assessee.

Issues: (i) Whether the relevant date for limitation of refund of accumulated CENVAT credit attributable to export of services is the date of the export invoice or the last day of the quarter in which foreign exchange is received; and (ii) Whether refund of CENVAT credit can be denied solely because the invoices relate to unregistered premises.

Issue (i): Whether the relevant date for limitation of refund of accumulated CENVAT credit attributable to export of services is the date of the export invoice or the last day of the quarter in which foreign exchange is received.

Analysis: Rule 5 of the CENVAT Credit Rules, 2004, read with Notification No. 27/2012-C.E. (N.T.) dated 18.06.2012, governed the refund. Although Section 11B of the Central Excise Act, 1944 applied to such refund claims, it did not prescribe a specific relevant date for export of services. The applicable principle fixed the relevant date as the last day of the quarter in which the export proceeds were received in foreign exchange. The date of the export invoice could not invariably be adopted, and the prospective character of the subsequent notification did not displace that principle.

Conclusion: The one-year limitation is to be reckoned from the last day of the quarter in which foreign exchange is received, and not from the date of the export invoice. The issue is decided in favour of the assessee.

Issue (ii): Whether refund of CENVAT credit can be denied solely because the invoices relate to unregistered premises.

Analysis: Rule 5 of the CENVAT Credit Rules, 2004, did not make registration of the premises a prerequisite for refund of unutilised CENVAT credit attributable to exported services. The requirement concerning the jurisdictional authority for filing the refund application could not operate as a prohibition on refund merely because the premises from which services were exported were unregistered. The jurisdictional High Court ruling on this point was binding.

Conclusion: Refund cannot be denied merely because the invoices pertain to unregistered premises. The issue is decided in favour of the assessee.

Final Conclusion: The limitation objection based on the export-invoice date and the objection based solely on non-registration of premises cannot defeat the refund claim.

Issues: (i) Whether service tax on construction of the residential complex was sustainable under Construction of Residential Complex Service; (ii) Whether receipts accounted for as sub-contract and petty job receipts were liable to service tax under the same category; and (iii) Whether the demand under Renting of Immovable Property Service was sustainable.

Issue (i): Whether service tax on construction of the residential complex was sustainable under Construction of Residential Complex Service.

Analysis: The statutory definition of a residential complex required proof that the prescribed conditions, including the number of dwelling units, were satisfied. The material did not establish that the additional units were constructed by, or attributable to, the appellant. Further, the Explanation inserted in Section 65(105)(zzzh) with effect from 01.07.2010 could not be retrospectively applied to construction undertaken before that date. The contracts were composite contracts involving goods and services; such contracts could not be taxed under the construction-service categories, which applied to services simpliciter.

Conclusion: The construction-service demand was unsustainable, in favour of the assessee.

Issue (ii): Whether receipts accounted for as sub-contract and petty job receipts were liable to service tax under the same category.

Analysis: The receipts were treated as consideration for construction services without establishing their precise nature or that they represented independently taxable services simpliciter. The absence of documents from the appellant did not displace the Department's obligation to prove the taxable service and its legal basis. The reasoning applicable to composite works contracts also precluded their taxation under the construction-service category.

Conclusion: The demand on sub-contract and petty job receipts was unsustainable, in favour of the assessee.

Issue (iii): Whether the demand under Renting of Immovable Property Service was sustainable.

Analysis: Commercial letting alone did not establish the amount of tax payable. The eligibility for small service provider exemption, year-wise rental receipts, and the asserted tax payment on later receipts required verification. The allegations were not supported by sufficient evidence or cogent rebuttal of these matters; consequently, the evidentiary benefit enured to the appellant.

Conclusion: The demand under Renting of Immovable Property Service was unsustainable, in favour of the assessee.

Final Conclusion: The construction-related and rental demands lacked a sustainable legal and evidentiary basis, and the associated penalties could not survive.

Issues: (i) Whether sewage and drainage pumps were eligible for the concessional duty rate under Entry No. 235 of Notification No. 12/2012-C.E. dated 17.03.2012; (ii) Whether the earlier audit objection or the principle of res judicata precluded Revenue from denying the concessional rate; (iii) Whether the penalty imposed for availing the concessional rate was sustainable.

Issue (i): Whether sewage and drainage pumps were eligible for the concessional duty rate under Entry No. 235 of Notification No. 12/2012-C.E. dated 17.03.2012.

Analysis: Entry No. 235 grants the concessional rate only to power-driven pumps primarily designed for handling water. As the expression "water" is undefined, it was construed in its common and commercial sense as clean water, and not as sewage or drainage water. A claimant for a concessional notification must establish clear compliance with its conditions. The material showed that sewage and drainage pumps had a different design and manufacturing process from pumps for handling water; the engineer's certificate only stated that the pumps could also handle clean water and did not establish design similarity.

Conclusion: Sewage and drainage pumps were not eligible for the concessional rate under Entry No. 235; the differential duty and applicable interest were rightly sustained, against the assessee.

Issue (ii): Whether the earlier audit objection or the principle of res judicata precluded Revenue from denying the concessional rate.

Analysis: The audit objection was neither implemented through adjudication nor accepted by the assessee, which continued to pay duty at the full rate until March 2016. It therefore did not constitute a concluded determination capable of binding Revenue. Further, res judicata does not apply to distinct tax periods in the manner asserted, and a different position may be adopted where the prior view is not a binding final decision.

Conclusion: The earlier audit objection did not bar Revenue from denying the concessional rate, against the assessee.

Issue (iii): Whether the penalty imposed for availing the concessional rate was sustainable.

Analysis: The assessee had initially paid duty at the full rate and began claiming the concession after the audit objection. Revenue subsequently reversed its position and demanded differential duty. These circumstances did not disclose evidence warranting the penalty retained by the appellate authority.

Conclusion: The penalty was unsustainable and was set aside, in favour of the assessee.

Final Conclusion: The differential duty together with interest remains enforceable, while no penalty is exigible.

Ratio Decidendi: A claimant for a concessional excise notification must establish strict satisfaction of its conditions, and an undefined product expression is to be understood in its common-parlance meaning.

Issues: (i) Whether the claimed transitional input tax credit attributable to input services, exceeding the closing balance reflected in the ER-1 and ST-3 returns, required verification. (ii) Whether the notice under section 74(1) could be sustained on the alleged wilful misstatement or suppression of facts.

Issue (i): Whether the claimed transitional input tax credit attributable to input services, exceeding the closing balance reflected in the ER-1 and ST-3 returns, required verification.

Analysis: Section 140(1) permits carry-forward of eligible credit under the existing law. The difference between the credit declared in TRAN-1 and the balance reported in the pre-GST returns required verification against the relevant records before entitlement could be determined.

Conclusion: The transitional credit claim is to be verified by the Proper Officer/Adjudicating Authority through a reasoned order.

Issue (ii): Whether the notice under section 74(1) could be sustained on the alleged wilful misstatement or suppression of facts.

Analysis: Invocation of section 74(1) requires material establishing fraud, wilful misstatement, or suppression of facts with a deliberate intent to evade tax. Mere incorrect information or an ordinary non-declaration does not by itself establish those elements. No investigation or evidence establishing such deliberate intent was on record.

Conclusion: The notice issued under section 74(1) was not sustainable, in favour of the assessee.

Final Conclusion: The transitional-credit claim remains subject to factual verification, but the fraud-based notice cannot be maintained.

Ratio Decidendi: An incorrect declaration, without material evidence of a deliberate intent to evade tax, does not establish wilful misstatement or suppression of facts for invoking section 74(1).

Issues: Whether the extended period of limitation could be invoked on an allegation of suppression of facts.

Analysis: The differential demand arose from an audit-based verification of the assessee's books of account and invoices, with a prior departmental communication quantifying the liability. The record disclosed no material establishing deliberate suppression of facts or an intent to evade tax. Mere delayed payment and detection upon scrutiny of accounts were insufficient to invoke the extended period of limitation. A show-cause notice issued beyond the normal limitation period raises a jurisdictional challenge and cannot sustain the demand.

Conclusion: The extended period of limitation was not invocable; the show-cause notice and consequential demand were time-barred, in favour of the assessee.

Issues: Whether penalty was sustainable for failure to furnish information underlying a third-party valuation used to benchmark international transactions.

Analysis: Section 271G of the Income-tax Act, 1961 applies to failure to furnish documents or information prescribed under Rule 10D of the Income-tax Rules and requisitioned under section 92D. The third-party company's internal projections and inputs were neither prepared nor controlled by the assessee and did not fall within the relevant Rule 10D requirements. The assessee substantially complied with fresh requisitions by furnishing the valuation report, transfer pricing documentation and other available material. The authority could also have sought additional information directly from the third party or valuer without shifting the assessee's statutory burden. Acceptance of the valuation in the quantum proceedings further undermined the basis alleged for non-furnishing.

Conclusion: The penalty was not sustainable.

Ratio Decidendi: A discretionary penalty for failure to furnish transfer pricing documentation cannot be sustained where the taxpayer has substantially complied with applicable requirements and the unavailable third-party information falls outside the prescribed documentation obligations.

Issues: (i) Whether Rs. 39,45,000 representing an old credit, written back and offered to tax in the succeeding year, could be added under Section 41(1) in the assessment year in dispute; (ii) Whether, under the project completion method, receipts from sales in a completed tower of a three-tower project were taxable before completion of the entire project; (iii) Whether the addition for maintenance charges and GST could be sustained without providing the assessee an opportunity to respond.

Issue (i): Whether Rs. 39,45,000 representing an old credit, written back and offered to tax in the succeeding year, could be added under Section 41(1) in the assessment year in dispute.

Analysis: Section 41(1) requires a trading liability, its remission or cessation in the relevant year, and a resulting benefit to the assessee. The credit had continued from an earlier assessment year and remained outstanding during the relevant year. Its write-back and taxability occurred only in the succeeding year. An unrelated debit concerning a different entity could not be linked to the credit entry to infer cessation in the relevant year.

Conclusion: The addition under Section 41(1) was unsustainable and was directed to be deleted, in favour of the assessee.

Issue (ii): Whether, under the project completion method, receipts from sales in a completed tower of a three-tower project were taxable before completion of the entire project.

Analysis: The three towers formed one project approved by the competent authority, although the towers were separately registered. Only one tower had been completed during the relevant year, while the other two remained under development. The project completion method is a recognised method of revenue recognition, and the receipts from the whole project were subsequently offered to tax upon completion of the entire project. Separate registration or completion of one tower did not justify artificially treating it as an independent project for recognising income.

Conclusion: Receipts from sales in the completed tower were not taxable before completion of the entire project; the addition was directed to be deleted, in favour of the assessee.

Issue (iii): Whether the addition for maintenance charges and GST could be sustained without providing the assessee an opportunity to respond.

Analysis: Although the assessment order recorded issuance of a show-cause notice, the record included a specific assertion that no opportunity had been given on the proposed maintenance and GST addition. A fresh determination after due and reasonable opportunity was required in accordance with principles of natural justice.

Conclusion: The issue was remitted for fresh adjudication after providing due and reasonable opportunity of hearing, without a merits determination.

Final Conclusion: The additions relating to the old credit and premature recognition of project receipts cannot be sustained, while the maintenance and GST matter requires reconsideration after hearing the assessee.

Issues: (i) Whether available input tax credit could be set off against VAT liability; (ii) whether excess credit claimed through TRAN-1 could be addressed by denying that VAT set-off.

Issue (i): Whether available input tax credit could be set off against VAT liability.

Analysis: The assessment recorded available input tax credit and a VAT liability. The applicable approach permitted the liability to be adjusted against the available credit, with the remaining credit carried forward.

Conclusion: The set-off was permissible, in favour of the assessee.

Issue (ii): Whether excess credit claimed through TRAN-1 could be addressed by denying that VAT set-off.

Analysis: Rule 117 of the GST Rules, 2017 provides for credit declared in TRAN-1 to be entered in the electronic credit ledger. Rule 121 provides for verification and action under Sections 73 or 74 of the GST Act concerning wrongly availed credit. The VAT department could inform the GST department of a potentially excessive transitional claim.

Conclusion: Excess transitional credit could not be addressed by denying the VAT set-off; action concerning such credit lies under the GST framework. The issue was decided in favour of the assessee.

Final Conclusion: The VAT set-off remains available, while any excess transitional credit remains open to action under the GST framework.

Ratio Decidendi: Available input tax credit may be set off against VAT liability; an excess transitional credit claim is to be addressed under the GST framework rather than by denying that set-off.

Issues: (i) Whether the assessee's transfer price for bagasse could be accepted as the arm's length price; (ii) whether irrecoverable loans and advances used to support an overseas subsidiary were deductible as a business loss; (iii) whether tax deduction at source was required on harvesting and transportation payments.

Issue (i): Whether the assessee's transfer price for bagasse could be accepted as the arm's length price.

Analysis: Third-party quotations, the applicable Karnataka electricity tariff and calculations based on the fair and remunerative price of sugarcane supported the valuation. The Karnataka tariff price had been adjusted for the relevant year. The price used in the central electricity tariff was not determinative of the arm's length price in light of that material.

Conclusion: The transfer price was accepted, and no substantial question of law arose. The issue was decided in favour of the assessee.

Issue (ii): Whether irrecoverable loans and advances used to support an overseas subsidiary were deductible as a business loss.

Analysis: The subsidiary was established to extend the assessee's sugar business overseas. Payments to its vendors supported that business and became irrecoverable after the subsidiary was wound up. Direct payment to vendors did not itself negate commercial expediency or the business nexus.

Conclusion: The write-off was deductible as a business loss under Section 37, in favour of the assessee.

Issue (iii): Whether tax deduction at source was required on harvesting and transportation payments.

Analysis: A sample farmer agreement indicated that harvesting charges were payable by the farmer and could be deducted from the sugarcane price. Whether the payments were in fact part of the purchase cost and deducted from amounts payable to farmers required verification. If they were not, the claimed deduction of tax on those payments could also be examined.

Conclusion: No tax deduction at source was required if the payments formed part of the purchase cost and were deducted from the price payable to farmers. The factual question and resulting disallowance remain for fresh determination.

Final Conclusion: The accepted bagasse valuation and subsidiary-loss deduction stand; the harvesting and transportation disallowance remains subject to verification.

Ratio Decidendi: No obligation to deduct tax at source arises where an assessee pays harvesting and transportation charges on farmers' behalf, the charges form part of the purchase cost, and they are deducted from the price payable to the farmers.

Issues: Whether receipts from satellite transmission services constitute equipment or process royalty under domestic law or the India-Singapore tax treaty.

Analysis: Customers received access to bandwidth while the satellite operator retained control of the satellite and transponder. The agreements did not grant customers a right to use the satellite or its embedded process. The substance of the arrangement, rather than leasing terminology, governed its characterisation. Retrospective amendments to domestic law did not alter the treaty definition of royalty.

Conclusion: The satellite transmission receipts were not taxable as royalty under either domestic law or the treaty, in favour of the assessee.

Ratio Decidendi: Satellite transmission payments are not equipment or process royalty where customers receive no right to use the satellite or its embedded process; unilateral amendments to domestic law do not alter the treaty definition of royalty.

Issues: (i) Whether the business exhibition service tax demand could be sustained on the basis of the difference between balance-sheet figures and certified receipts; (ii) whether the fresh adjudication exceeded the scope of the remand directions.

Issue (i): Whether the business exhibition service tax demand could be sustained on the basis of the difference between balance-sheet figures and certified receipts.

Analysis: Books of account, balance sheets and chartered accountant certificates are admissible evidence of their contents. The explanation of the difference referred to accounting practices, including accrual-based certification and tax payment on actual receipts. The organiser had discharged service tax on the same receipts. The balance-sheet figures lacked supporting evidence for an additional demand.

Conclusion: The demand, interest and proportionate penalties cannot be sustained; in favour of the assessee.

Issue (ii): Whether the fresh adjudication exceeded the scope of the remand directions.

Analysis: The remand confined the inquiry to reconciling certified revenue sharing with exhibition receipts in the balance sheet, including consideration of claimed government grants. The fresh adjudication was required to comply with those directions.

Conclusion: The adjudication exceeded the remand directions and breached judicial discipline; in favour of the assessee.

Final Conclusion: No additional service-tax liability survives on the basis adopted in the fresh adjudication.

Ratio Decidendi: An adjudicating authority must confine its determination to the issues specified in the remand directions.

Issues: Whether excess transitional input tax credit claimed through TRAN-1 could be assessed as tax and interest under the VAT law or required action under the GST law.

Analysis: The excess credit claimed in TRAN-1 exceeded the credit available under the VAT assessment, but the claim did not itself establish a breach of the VAT law. The available VAT credit could be set off against tax payable. Rule 117 provides for crediting the amount specified in TRAN-1 to the electronic credit ledger, while Rule 121 provides for verification and action under the GST law in respect of wrongly availed credit. The VAT authorities could inform the GST department of the excess claim.

Conclusion: The VAT demand and interest were removed; remedial action under the GST law remained available. The issue was decided in favour of the assessee.

Ratio Decidendi: An excess transitional credit claim in TRAN-1 does not itself create a VAT liability; wrongly availed transitional credit is subject to action under the applicable GST provisions.

Outcome: The special leave petition was dismissed, and pending applications were disposed of.

Issues: (i) Whether the assessee's available pre-GST ITC must be adjusted against GVAT and CST liabilities before determining the balance eligible for transition; (ii) Whether VAT authorities may deny that set-off by reference to ITC declared in FORM GST TRAN-1, or whether excess transitional credit must be addressed by GST authorities.

Issue (i): Whether the assessee's available pre-GST ITC must be adjusted against GVAT and CST liabilities before determining the balance eligible for transition.

Analysis: The admitted surplus ITC under the pre-GST regime was available for adjustment against the outstanding liabilities under the GVAT Act and the CST Act. The adjustment had to be made before calculating the balance ITC capable of being carried forward into the GST regime. The direction for fresh determination on that basis was therefore consistent with the applicable set-off principle.

Conclusion: The available pre-GST ITC must first be set off against GVAT and CST liabilities; the finding is in favour of the assessee.

Issue (ii): Whether VAT authorities may deny that set-off by reference to ITC declared in FORM GST TRAN-1, or whether excess transitional credit must be addressed by GST authorities.

Analysis: Rule 117(3) of the GST Rules, 2017 permits credit declared in FORM GST TRAN-1 to be credited to the electronic credit ledger. Rule 121 of the GST Rules, 2017 provides the GST mechanism for verification and action concerning wrongly availed credit through Sections 73 or 74 of the GST Act. The VAT authorities could inform the competent GST officer of any excess credit transitioned, but could not use the TRAN-1 declaration to deny adjustment of ITC against liabilities arising under the pre-GST enactments.

Conclusion: Any wrongly transitioned ITC is to be dealt with under the GST framework, and cannot defeat the assessee's pre-GST ITC set-off; the finding is in favour of the assessee.

Final Conclusion: Pre-GST tax liabilities must be adjusted from available pre-GST ITC, and only the resulting balance is eligible for transition; the legality of any excess transitional credit falls for action by the GST authorities.

Ratio Decidendi: A VAT authority cannot deny statutory set-off of available pre-GST input tax credit by relying on credit transitioned through FORM GST TRAN-1, since verification and recovery of wrongly availed transitional credit lie within the GST statutory mechanism.

Issues: Whether dumpers and tippers deployed for transportation integral to composite mining contracts qualify for higher depreciation as vehicles used in the business of running them on hire.

Analysis: Section 32(1) of the Income-tax Act, 1961 and sub-item 2(ii) of Item III of Appendix I to the Income-tax Rules, 1962 allow higher depreciation for motor lorries used in the business of running them on hire. CBDT Circulars No. 609 and No. 652 clarify that the benefit extends to motor lorries used in the assessee's own business of transporting goods on hire, but not in a non-hiring business. The contractual terms established that excavation, loading, transportation, dumping and related operations formed an integrated composite mining contract; the minerals and overburden belonged to the mine owners, and the assessee's dumpers and tippers were deployed to transport those materials under the contractual obligations. These facts brought the case within the applicable principle governing equipment and vehicles supplied on hire for mining and transportation operations, and were materially distinct from cases involving merely occasional hiring or vehicles used ancillary to a different principal business.

Conclusion: Dumpers and tippers used for transportation under the composite mining contracts were used in the business of running them on hire and qualified for depreciation at the higher rate of 30%.

Issues: Whether the 89-day delay in filing the statutory appeal against the assessment order should be condoned and the appellate rejection set aside.

Analysis: The appeal was rejected because it was filed beyond the condonable period. The explanation that the petitioner's accountant was seriously ill and therefore failed to access the portal and communicate the assessment order was accepted as genuine. The admitted recovery of 24.36% of the disputed tax was also taken into account while prescribing the deposit required for restoration of the appellate remedy.

Conclusion: The delay of 89 days was condoned and the appellate rejection was set aside, subject to payment of the balance required to make up 25% of the disputed tax after adjusting the amount already recovered. The appellate authority must take the appeal on record and decide it on merits after affording personal hearing.

Outcome: The appeal was allowed, the impugned order was set aside, and the writ petition was restored for consideration.

Issues: (i) Whether a cost-free corporate guarantee to a foreign associated enterprise constitutes an international transaction; (ii) What arm's-length commission rate applies to the guarantee; (iii) Whether the sales commission paid to the foreign associated enterprise was disallowable for non-deduction of tax at source.

Issue (i): Whether a cost-free corporate guarantee to a foreign associated enterprise constitutes an international transaction.

Analysis: The Explanation to section 92B, introduced by the Finance Act, 2012, addresses guarantees. Binding precedent identified inherent risk and enhanced creditworthiness for the associated enterprise notwithstanding the absence of an immediate cost.

Conclusion: The corporate guarantee is an international transaction. The issue is against the assessee.

Issue (ii): What arm's-length commission rate applies to the guarantee.

Analysis: The arm's-length rate was benchmarked by reference to a High Court decision and other tribunal decisions concerning corporate guarantees.

Conclusion: The guarantee commission is to be computed at 0.5% instead of 1%. The issue is in favour of the assessee.

Issue (iii): Whether the sales commission paid to the foreign associated enterprise was disallowable for non-deduction of tax at source.

Analysis: Section 195 requires withholding only where the payment is chargeable to tax in India. An adopted earlier decision on the same agreement treated the marketing commission as outside the treaty's fees-for-included-services category; no change in facts or law was identified.

Conclusion: The sales commission is not disallowable for non-deduction of tax at source. The issue is in favour of the assessee.

Final Conclusion: The guarantee remains within the transfer-pricing regime at a reduced commission rate, while the sales commission is not subject to disallowance for non-withholding.

Ratio Decidendi: A corporate guarantee furnished without charge to an associated enterprise is an international transaction subject to arm's-length pricing.