Remand for fresh assessment - applicability of limitation period to assessment/revised assessment after remand - jurisdiction to reopen assessment pursuant to court direction - opportunity of hearing and right to inspect records before final assessmentApplicability of limitation period to assessment/revised assessment after remand - remand for fresh assessment - Limitation prescribed for passing original assessment or revised assessment is not applicable to the proposed assessment occasioned by the High Court setting aside the original assessment and remanding the matter for fresh disposal. - HELD THAT: - The High Court had earlier quashed the original assessment and remanded the matter to the assessing authority for fresh assessment within two months. In the present proceeding the Court observed that because the original order was set aside and remanded, the proposed assessment is neither an original assessment nor a revised assessment within the ordinary limitation scheme, and therefore the limitation periods for original or revised assessments do not apply to the facts of this case. The Court noted uncertainty as to when the assessing authority actually received a copy of the remand judgment from the petitioner but held that the question whether the limitation applicable to revised assessments would apply on remand did not require determination on the present facts. On that basis the petitioner's challenge based on the lapse of statutory time for assessment was not sustained. [Paras 7, 8]Petitioner's contention that notices issued after twelve years violated the limitation periods is rejected; limitation periods for original/revised assessment do not apply to the assessment proceedings remitted by the High Court in the facts of this case.Opportunity of hearing and right to inspect records before final assessment - jurisdiction to reopen assessment pursuant to court direction - Petitioner must be afforded opportunity to inspect records and file reply before finalisation of the assessment; assessing authority may proceed if petitioner does not file a reply within the time granted. - HELD THAT: - Although the writ petition was dismissed, the Court granted the petitioner liberty to appear before the Deputy Commissioner, inspect records and file a reply within three weeks. The Court directed that if the petitioner appears, an opportunity of hearing must be given before passing the final order; conversely, if no reply is filed within the stipulated period, the assessing authority is authorised to proceed to pass appropriate orders in accordance with law. [Paras 8]Writ petition dismissed with liberty to inspect records and file reply within three weeks; assessing authority to proceed and pass orders if no reply is filed, and to hear the petitioner if the petitioner appears.Final Conclusion: Writ petition dismissed. Court held limitation for original or revised assessment inapplicable to assessment proceedings remitted by the High Court in these facts; petitioner granted limited liberty to inspect records and file reply within three weeks, failing which the assessing authority may pass final orders in accordance with law, and if the petitioner appears he must be heard before finalisation.

Penalty under section 271C - reasonable cause for failure to deduct tax at source - burden of proof on assessee to show reasonable cause - contumacious conduct - effect of assessment/appeal outcomes on levy of penaltyPenalty under section 271C - reasonable cause for failure to deduct tax at source - burden of proof on assessee to show reasonable cause - contumacious conduct - effect of assessment/appeal outcomes on levy of penalty - Whether penalty under section 271C could be sustained for failure to deduct tax at source where the assessee contends bona fide belief and the ultimate assessment/appeal outcome rendered the matter revenue-neutral. - HELD THAT: - The Tribunal analysed the statutory scheme and held that levy of penalty under section 271C is not automatic; the officer must first be satisfied that the failure to deduct tax at source was without reasonable cause. The initial burden rests on the assessee to establish reasonable cause. Reasonable cause is an honest belief founded on reasonable grounds such that a prudent person in similar circumstances would conclude that non-deduction was proper. On the facts, the assessing officer had added the impugned payments under section 40(a)(i) and the matter was later considered on appeal where the ITAT partly allowed the quantum appeal and the effect became revenue-neutral for the Department. The Tribunal found no contumacious or deliberate conduct by the assessee; the assessee had a bona fide belief that TDS was not required and the revenue had already adjusted the matter in assessment. In these circumstances the explanation was not frivolous or without foundation and therefore constituted reasonable cause. Accordingly, the Tribunal deleted the penalty. The Tribunal treated the other grounds (including limitation/contentions on initiation timing) as academic in view of the deletion of penalty. [Paras 7]Penalty under section 271C is deleted as the assessee established reasonable cause for non-deduction of tax at source and there was no contumacious conduct; other grounds rendered academic.Final Conclusion: The appeal is allowed: the penalty imposed under section 271C for AY 2011-12 is deleted on the ground of bona fide and reasonable cause for non-deduction of tax at source; ancillary/contentions are treated as academic.

Condonation of delay - limitation for filing appeal - ex-parte assessment under section 144 read with section 147 - remand for fresh adjudication on merits - deposit as condition for grant of relief - exclusion of limitation period during Covid-19Condonation of delay - limitation for filing appeal - ex-parte assessment under section 144 read with section 147 - exclusion of limitation period during Covid-19 - Whether the appeal dismissed in limine by the Commissioner for want of prosecution/limitation should be restored for adjudication on merit. - HELD THAT: - The Tribunal examined the Commissioner's in limine dismissal of the appeal for delay and the documentary material filed to explain the delay, including an affidavit by the assessee's erstwhile director claiming detention abroad from March 2018 to October 2021 and technical difficulties in filing the appeal. The Tribunal found that the assessee failed to satisfactorily substantiate the delay before the Commissioner, but, on a holistic view, noted mitigating circumstances: the assessment was ex parte, the director's asserted detention and subsequent need to take stock of proceedings, and the judicial exclusion of the Covid 19 period while computing limitation. Although a gap of about one year after return to India was not fully explained, the Tribunal held that no prejudice would be caused to the Revenue and substantial justice requires adjudication on merits. Accordingly, the Tribunal set aside the Commissioner's in limine dismissal and remanded the quantum appeal for fresh decision on merits, subject to a condition of deposit to secure the Revenue's interest. The Commissioner is to afford reasonable opportunity to the assessee, and further default will disentitle the assessee to leniency. [Paras 4, 6]Set aside the Commissioner's in limine dismissal of the appeal and remand the quantum appeal for fresh adjudication on merits, conditional upon deposit of Rs. 51,000 in the Prime Minister's National Relief Fund within 30 days; grant of opportunity to the assessee and warning that further default bars leniency.Remand for fresh adjudication on merits - penalty imposed under section 271(1)(c) - deposit as condition for grant of relief - Whether the penalty order affirmed by the Commissioner should be restored to the Commissioner for fresh decision after remand of the assessment order. - HELD THAT: - The Tribunal observed that the penalty appeal was predicated on the assessment order which had been dismissed in limine by the Commissioner. Having set aside and remanded the quantum assessment for fresh adjudication, the Tribunal found it necessary to remit the penalty proceedings as well to enable coordinated determination on merits. The remand of the penalty appeal is made on the same terms as the quantum remand, including the deposit condition to protect the Revenue's interest, and with directions to afford the assessee reasonable opportunity; continued non compliance will forfeit any entitlement to leniency. [Paras 5, 6]Set aside the Commissioner's order on penalty and remand the penalty proceedings for fresh decision on merits on the same terms as the quantum remand, subject to deposit of Rs. 51,000 in the Prime Minister's National Relief Fund within 30 days and with reasonable opportunity to the assessee.Final Conclusion: Both appeals are allowed to the extent that the in limine dismissal of the quantum appeal and the consequential penalty order are set aside and remitted to the Commissioner for fresh adjudication on merits; relief is made subject to the deposit of Rs. 51,000 in the Prime Minister's National Relief Fund within 30 days and with directions to afford reasonable opportunity to the assessee, failure of which will forfeit leniency.

Rectification of GSTR-1 - inadvertent human error - input tax credit entitlement - rectification under Section 37(3) provisos - absence of notified Forms GSTR-2/GSTR-1A as disabling mechanism - judicial discretion to permit corrective uploadingRectification of GSTR-1 - inadvertent human error - input tax credit entitlement - absence of notified Forms GSTR-2/GSTR-1A as disabling mechanism - Petitioner permitted to upload rectified GSTR-1 statements for specified periods and to claim corresponding input tax credit - HELD THAT: - The Court found that the petitioner had committed inadvertent errors in filing GSTR-1 for August 2017, November 2017, December 2017 and January 2018 and had missed the statutory window for rectification because it was unaware of the notification extending time. Having regard to the absence, at the relevant time, of notified enabling forms (GSTR-2/GSTR-1A) which would have facilitated detection and correction of mismatches, and to the line of decisions permitting rectification where no mala fides are alleged, the Court exercised its supervisory jurisdiction to permit corrective uploading. The Court relied on the principle that bonafide human errors should not deprive a party of legitimate input tax credit where the statutory mechanism for seamless correction was not effectively available, and directed a time-bound procedure for the petitioner to upload rectified GSTR-1 and for the respondents to process and enable the auto-population and grant of the claimed input tax credit. [Paras 7, 9]Writ petition allowed; petitioner permitted to upload rectified GSTR-1 within four weeks and respondent directed to process and enable the claimed input tax credit within the prescribed short time-frames.Final Conclusion: The writ petition is allowed: the petitioner is authorised to upload rectified GSTR-1 for the periods August 2017, November 2017, December 2017 and January 2018 within four weeks; the respondent is directed to upload and process the rectified statements and enable the petitioner to avail the claimed input tax credit within the time periods ordered.

Inclusion of freight and insurance in assessable value - Valuation Rules, 2007 - Rule 10(b) - transaction value under Section 14(1) of the Customs Act, 1962 - liability to pay customs duty on remnant ATF - penalty for short payment of customs duty - confiscation of imported goods and redemption fineInclusion of freight and insurance in assessable value - Valuation Rules, 2007 - Rule 10(b) - transaction value under Section 14(1) of the Customs Act, 1962 - Transportation and insurance charges are not includable in the assessable value of remnant ATF for determining customs duty under the Valuation Rules, 2007. - HELD THAT: - The Tribunal considered whether notional transportation (20%) and insurance (1.125%) must be added to the IOCL price of remnant ATF for valuation under Rule 10(b) of the Valuation Rules, 2007 and Section 14(1) of the Customs Act, 1962. Applying the Larger Bench decision in the assessee's own case, the Tribunal accepted that ATF filled in aircraft fuel tanks is consumed to operate the aircraft and is not being transported as goods for delivery to India; consequently, the cost of transportation need not be included in the transaction value. The Larger Bench further observed that only where oil companies import ATF as cargo for sale would transport cost be part of transaction value. On that determinative reasoning the demand premised on adding notional freight and insurance to the assessable value was unsustainable and set aside.Transportation and insurance charges are not includable in the value of remnant ATF; the duty demand based on their inclusion is set aside.Penalty for short payment of customs duty - Penalty imposed on the assessee for short payment of duty is not sustainable and is set aside. - HELD THAT: - Since the primary demand for additional customs duty was annulled on the ground that transportation and insurance could not be included in the assessable value of remnant ATF, the Tribunal held that the consequential penalty could not survive. The Tribunal therefore set aside the penalty imposed by the adjudicating authority.Penalty is not imposable and is quashed.Confiscation of imported goods and redemption fine - liability to pay customs duty on remnant ATF - Remnant ATF is not liable for confiscation and no redemption fine is payable. - HELD THAT: - Revenue had appealed for confiscation and imposition of a redemption fine. The Tribunal recorded that the adjudicating authority did not order confiscation and, in light of the finding that the duty demand itself was unsustainable, held that goods were not liable for confiscation and that no redemption fine should be imposed. The Tribunal endorsed the adjudicating authority's refraining from confiscation and refusal to impose a redemption fine.Goods are not liable to confiscation; no redemption fine is imposable.Final Conclusion: The Tribunal allowed the assessee's appeal and dismissed the Revenue's appeal: the addition of notional freight and insurance to the assessable value of remnant ATF is rejected, the resulting duty demand and penalty are set aside, and the remnant ATF is not liable for confiscation or redemption fine.

Reassessment proceedings - personal hearing - speaking order - Section 148A(d) of the Income Tax Act, 1961 - notice under Section 148Section 148A(d) of the Income Tax Act, 1961 - notice under Section 148 - personal hearing - speaking order - reassessment proceedings - Impugned order dated 30.03.2023 under Section 148A(d) and the consequential notice dated 30.03.2023 under Section 148 issued without granting oral hearing were to be set aside, with liberty to the Assessing Officer to pass a fresh order after granting hearing and furnishing a speaking order to the petitioner. - HELD THAT: - The respondents filed an affidavit admitting that no oral hearing was granted before passing the order under Section 148A(d) in respect of Assessment Year 2019-20. The Court noted the contention that relevant documents and portal information had been placed before the Assessing Officer and that guidelines require verification and personal hearing. In light of the admission that no hearing was afforded, the Court concluded that the appropriate course was to set aside the impugned order and the consequent notice and to permit the Assessing Officer to pass a fresh order after granting an oral hearing to the petitioner or his authorised representative. The Court required that the fresh order be a speaking order and that a copy be furnished to the petitioner. [Paras 4, 5, 6]Impugned order dated 30.03.2023 under Section 148A(d) and the notice dated 30.03.2023 under Section 148 are set aside; AO may pass a fresh order after granting oral hearing and issuing a speaking order, a copy of which shall be furnished to the petitioner.Final Conclusion: Writ petition disposed of by setting aside the order dated 30.03.2023 under Section 148A(d) and the consequent notice dated 30.03.2023 under Section 148; liberty granted to the Assessing Officer to pass a fresh, speaking order after affording an oral hearing to the petitioner/authorised representative, and furnish a copy of that order to the petitioner.

Disallowance under section 14A read with Rule 8D - Limitation of disallowance to exempt income - Application of borrowed funds and claim under section 36(1)(iii) - Manner of book treatment not determinative of tax liabilityDisallowance under section 14A read with Rule 8D - Limitation of disallowance to exempt income - Validity of the addition made under section 14A read with Rule 8D when the disallowance far exceeded the exempt income earned by the assessee - HELD THAT: - The Court examined the assessment order where the AO applied Rule 8D to compute a disallowance of expenditure and arrived at an addition of Rs. 5,06,73,874/-, despite the assessee having declared exempt income of only Rs. 35,347/- and having itself made a suo motu disallowance of Rs. 87,442/-. Relying on established authority and the statutory purpose of section 14A, the Court held that disallowance under section 14A read with Rule 8D must be relatable to the exempt income and cannot, by computation under Rule 8D, swallow or exceed the exempt income itself. The Court concluded that the addition sustained by the CIT(A) was unsustainable and that the Tribunal was correct in deleting the addition. [Paras 6, 7, 16]Addition under section 14A read with Rule 8D which exceeded the exempt income is unsustainable and the Tribunal's deletion of the disallowance is upheld.Application of borrowed funds and claim under section 36(1)(iii) - Manner of book treatment not determinative of tax liability - Permissibility of the revenue to rely on the CIT(A)'s alternate reasoning based on section 36(1)(iii) at this stage and consequence of shares being treated as stock-in-trade in assessing interest disallowance - HELD THAT: - The Court noted that the CIT(A) had adverted to section 36(1)(iii) in upholding the disallowance on an alternative basis, but observed that the appeal before the Court was confined to the disallowance under section 14A read with Rule 8D. The factual material (tables showing purchases, sales and profits) was not disputed and demonstrated that the shares purchased with borrowings were sold and profits offered to tax. The Court emphasised that treatment in books does not conclusively determine tax liability. However, the Court refused to allow the revenue to spring a new case at this stage which was not articulated in its appeal and confined the adjudication to the question before it. [Paras 8, 11, 13, 14, 15]Revenue cannot raise a new case not framed in the appeal; since the shares purchased from borrowed funds were sold and profit offered to tax, the matter does not warrant overturning the Tribunal's deletion on the basis of section 36(1)(iii).Final Conclusion: The appeal is dismissed. The Tribunal's order deleting the disallowance under section 14A read with Rule 8D is upheld; no substantial question of law arises for interference.

Bail under Customs Act - offence under Section 135 of the Customs Act - valuation threshold affecting bailability - non-cognizable and bailable offence - compliance with search and seizure procedure under Customs law - tampering with prosecution evidence - conditions of bail and supervision by trial courtBail under Customs Act - offence under Section 135 of the Customs Act - valuation threshold affecting bailability - non-cognizable and bailable offence - conditions of bail and supervision by trial court - Whether the applicant Abdul Salam should be enlarged on bail in the case registered under Section 135 of the Customs Act. - HELD THAT: - The Court considered the prosecution narrative that nine gold biscuits valuing less than one crore were recovered from the applicant and the consequent submission that the offence falls within the bailable and non-cognizable category under the statutory scheme. The Court noted allegations concerning procedural defects in search and seizure but did not record a conclusive finding adverse to the prosecution on those points. Having regard to the nature of the evidence on record, absence of convincing material indicating likelihood of tampering with evidence, the fact that a co-accused had earlier been granted bail, the applicant's custodial period and lack of criminal history, the Court exercised its discretion to grant bail. Bail was made subject to furnishing personal bond and two heavy local sureties, and to conditions designed to protect the integrity of the trial: prohibition on tampering with evidence or harming complainant, adherence to court dates, an undertaking not to seek adjournments when witnesses are present, restrictions against misuse of bail (with calibrated consequences), and mandatory personal attendance at specified stages of trial. The trial court is required to verify the identity and residential status of sureties and is empowered to cancel bail on breach of conditions in accordance with law.Bail granted to applicant Abdul Salam on furnishing bond and two heavy local sureties subject to specified conditions and verification by the trial court.Compliance with search and seizure procedure under Customs law - tampering with prosecution evidence - Whether alleged procedural non-compliance in seizure proceedings or risk of tampering warranted denial of bail. - HELD THAT: - The applicant contended that provisions governing search and seizure were not complied with and that he was falsely implicated. The prosecution relied on the prohibited nature of the recovered material and opposed bail. The High Court observed these contentions but found no convincing material on record indicating a real prospect of tampering with evidence that would justify denial of bail. The Court did not finally adjudicate the merits of alleged procedural irregularities; rather, on the available record and overall facts and circumstances, the Court concluded that bail could be granted subject to protective conditions and left verification and any necessary adjudication on procedural compliance to the trial process.Alleged procedural non-compliance and risk of tampering did not preclude grant of bail; substantive determination of procedural irregularities left to trial.Final Conclusion: The High Court allowed the bail application of Abdul Salam in the criminal proceedings under Section 135 of the Customs Act, directing release on furnishing a personal bond and two heavy local sureties subject to specified conditions and verification by the trial court, while leaving substantive adjudication of procedural compliance to the trial forum.

Refund of accumulated CENVAT credit under Rule 5 - Availability of CENVAT credit for exported services - Manner of availment not to be questioned in refund proceedings - Irregular availment and recovery under Rule 14 - Nexus between input services and exported output serviceRefund of accumulated CENVAT credit under Rule 5 - Availability of CENVAT credit for exported services - Manner of availment not to be questioned in refund proceedings - Irregular availment and recovery under Rule 14 - Nexus between input services and exported output service - Whether the appellant is entitled to refund of unutilized CENVAT credit under Rule 5 in respect of input services when the output services were exported, notwithstanding Revenue's contention regarding nexus or conformity of availment - HELD THAT: - The Tribunal held that Rule 5 is a self-contained provision permitting refund of accumulated CENVAT credit where the formula and conditions prescribed thereunder are satisfied and that, in the context of refund under Rule 5, the department is confined to verifying compliance with that rule and the related notifications. The Tribunal accepted that Rule 3 enables availment of CENVAT credit and that Rule 14 provides the mechanism for recovery of irregularly availed credit, but observed that recovery under Rule 14 must be invoked independently. In the present case the department had not invoked Rule 14 or initiated recovery proceedings; consequently, denial of refund on the ground that the credit was irregularly availed or lacked nexus with the output service was impermissible in the refund proceedings. The Tribunal relied on its earlier decision in Qualcomm India Pvt. Ltd. and the subsequent affirmation by the High Court to hold that, where output services are exported and the refund formula is complied with, the unutilized CENVAT credit ought to be granted as refund. Applying that reasoning, the Tribunal found no merit in the impugned denial of refund and allowed the appeals. [Paras 5, 6]Impugned order denying refund set aside; appeals allowed and refund benefit under Rule 5 granted to the appellants.Final Conclusion: The Tribunal concluded that where output services have been exported and the statutory formula under Rule 5 is satisfied, the unutilized CENVAT credit must be refunded; denial of refund on grounds of alleged irregular availment or lack of nexus (without separate recovery proceedings under Rule 14) is not permissible, and the impugned orders refusing refund were set aside.

Concessional rate of tax under proviso to Section 6(1) of the KVAT Act - declaration in Form 42 - best evidence of shipment / shipping documents - liberty to represent to the Administrator to furnish shipping bills - reassessment on production of documents - maintainability of writ petitionMaintainability of writ petition - Present writ petition seeking direction to the Administrator to furnish historical shipping documents is not maintainable. - HELD THAT: - The petition challenges the Administrator's alleged inability or refusal to furnish shipping bills or other best evidence for supplies made between 2005 and 2010. The Court noted that the petitioner had earlier litigated similar claims and that the Division Bench had granted a specific procedural liberty to seek such documents from the Administrator and thereafter place any proof before the Assessing Officer for reassessment. Given that the documents sought relate to a period many years earlier and may no longer be available, and having regard to the earlier proceedings and the relief previously accorded, the Court found no ground to entertain the present writ seeking a fresh direction to the Administrator. The Court therefore held the petition not maintainable and declined to exercise writ jurisdiction to compel production of historical records in the circumstances of this case. [Paras 9]Writ petition dismissed as not maintainable; no direction issued to the Administrator to furnish the shipping documents.Best evidence of shipment / shipping documents - liberty to represent to the Administrator to furnish shipping bills - reassessment on production of documents - Court refused to grant the substantive relief of directing the Administrator to produce shipping documents, leaving the procedural route previously afforded by the Division Bench intact. - HELD THAT: - The Division Bench had earlier allowed the State's appeal but granted dealers liberty to request the Administrator to furnish shipping bills or similar documents duly attested, and provided for verification by the Administrator and reassessment by the Assessing Officer upon production. In the present petition the Court observed that the petitioner had the earlier-ordered procedural remedy and that the passage of time (supplies dating from 2005-2010) meant the Administrator might legitimately be unable to comply. In these circumstances the Court declined to exercise its writ powers to mandate production of documents and dismissed the petition while noting the availability of the prior procedural route. [Paras 9]No direction to the Administrator to produce shipping documents; the earlier liberty granted by the Division Bench remains the appropriate procedural remedy.Final Conclusion: The writ petition seeking a direction to the Administrator, Union Territory of Lakshadweep, to furnish shipping documents for supplies made in 2005-2010 is dismissed as not maintainable; no mandatory order for production of historical shipping records is issued, and the procedural liberty previously granted by the Division Bench remains the proper route.

Concessional late fee - GSTR-9/9C filing up to 31.08.2023 - late fee under Section 47 of the CGST Act - Article 14 equal protection - discriminatory differential treatmentConcessional late fee - GSTR-9/9C filing up to 31.08.2023 - Article 14 equal protection - Eligibility for concessional late fee under the CBIC notification dated 31.03.2023 for persons who filed GSTR-9/9C in respect of financial years 2017-18 to 2021-22 up to 31.08.2023. - HELD THAT: - The Court expressed a prima facie view that the scheme of the notification ought to extend the concessional late fee to any person who filed GSTR-9/9C for the financial years 2017-18 to 2021-22 on or before 31st August, 2023. The Court observed that treating assessees who filed before 1st April, 2023 differently from those who filed between 1st April, 2023 and 31st August, 2023 does not reveal any intelligible differentia in the scheme that would justify disparate treatment. Absent such intelligible differentia, the differentiation would amount to a violation of the guarantee of equality under Article 14 of the Constitution. The Court therefore indicated that assessees/dealers who filed the returns in GSTR-9/9C for the stated financial years before 31st August, 2023 should be eligible for the concessional rate of late fee prescribed in the notification.Prima facie entitlement recognised: assessees who filed GSTR-9/9C for FY 2017-18 to 2021-22 on or before 31.08.2023 should be eligible for the concessional late fee; differentiation without intelligible differentia would infringe Article 14.Late fee under Section 47 of the CGST Act - discriminatory differential treatment - Direction to the Central Board of Indirect Taxes & Customs to explain basis for differential treatment between filers before 01.04.2023 and filers between 01.04.2023 and 31.08.2023. - HELD THAT: - The Court permitted the Senior Standing Counsel for the Board one week to file an affidavit stating the basis on which different treatment is sought to be accorded to assessees who filed GSTR-9/9C prior to 1st April, 2023 and those who filed between 1st April, 2023 and 31st August, 2023 with reference to waiver of the late fee referred to in Section 47 of the CGST Act. This procedural direction was given in the context of the Court's prima facie conclusion on equality; the affidavit is directed to enable the respondents to justify any differentiation or to demonstrate an intelligible differentia supporting the notification's scheme.Respondent directed to file an affidavit within one week explaining the basis for the differential treatment regarding waiver/concession of late fee under the notification.Final Conclusion: The High Court took the prima facie view that assessees who filed GSTR-9/9C for FYs 2017-18 to 2021-22 on or before 31.08.2023 should be eligible for the concessional late fee under the CBIC notification dated 31.03.2023, as any unexplained differentiation between filings before 01.04.2023 and those up to 31.08.2023 would likely violate Article 14; the Board has been granted one week to file an affidavit explaining the basis for any differential treatment.

Refund of wrongly collected service tax - exemption by retrospective notification for long term lease services - time limit for refund under Section 104(3) of the Finance Act, 2017 - forum ambiguity in filing refund claims - bona fide conduct and absence of fault of the claimant - equitable relief from time bar where delay caused by third party or authorityTime limit for refund under Section 104(3) of the Finance Act, 2017 - refund of wrongly collected service tax - equitable relief from time bar where delay caused by third party or authority - Whether the refund claim filed by the appellant is barred by the six month limitation prescribed by Section 104(3) where the appellant paid service tax to a third party (KMDA) and made diligent efforts to obtain refund but was delayed by inaction and incorrect advice. - HELD THAT: - The Tribunal found that Notification No.41/2016 exempted the relevant services retrospectively for the period 1.6.2007 to 21.9.2016 but did not specify the authority with whom refund claims were to be filed. The appellant paid tax to KMDA (which deposited the tax in Government account) and sought refund from KMDA and, on KMDA's advice, approached the Service Tax department. The Service Tax Department advised that the assessee who deposited the tax (KMDA) must file the claim. Repeated follow ups and KMDA's inaction resulted in the appellant filing the refund claim with the Service Tax department only after delay. The Tribunal held that the delay in filing before the Service Tax department was not attributable to the appellant's fault but arose from forum ambiguity and third party/departmental inaction; having made sincere and timely efforts to obtain refund from KMDA, the appellant should not be penalised by strict application of the six month bar. The Tribunal followed the reasoning of the Hon'ble Madras High Court in Grand Technologies (reproduced in the order) and distinguished precedents where delay was due to the claimant's fault. On these facts the limitation in Section 104(3) was held not to operate to bar the refund claim. [Paras 7, 8, 10]Limitation under Section 104(3) does not bar the appellant's refund claim on the facts of this case; the time bar aspect is to be ignored and the refund claim is allowable.Forum ambiguity in filing refund claims - bona fide conduct and absence of fault of the claimant - Whether the decisions upholding rejection on time bar grounds (cited by the Department) apply where delay flowed from the claimant's bona fide approach to a third party and departmental inaction. - HELD THAT: - The Tribunal examined the Madhya Pradesh High Court decision (MDP Infra) and the subsequent Supreme Court upholding, noting those authorities concerned cases where delay was attributable to the appellant's conduct or where no ambiguity/excusable circumstances existed. In the present case the Tribunal found distinguishing facts: the appellant had timely approached the entity to whom it had paid tax (KMDA), relied on KMDA's advice, and pursued the matter with the Department; therefore precedents where delay resulted from the claimant's fault were inapplicable. The Tribunal thus declined to follow those authorities on the facts before it and followed the Madras High Court approach in Grand Technologies. [Paras 9, 10]Authorities upholding time bar are not applicable to these facts; the appellant's conduct excused the delay and the refund claim must be considered on merits.Final Conclusion: The impugned orders rejecting the refund claim as time barred are set aside; the appeal is allowed and the appellant is entitled to consequential relief, the refund claim to be processed on merits notwithstanding the limitation period.

Works Contract Services - service tax liability on sewerage and laying of pipes - interpretation of exemption for commercial and industrial construction services - precedent of Larger Bench in Lanco Infratech Ltd. - consequences of unsustainable demand: interest and penaltyWorks Contract Services - service tax liability on sewerage and laying of pipes - precedent of Larger Bench in Lanco Infratech Ltd. - Whether service tax is payable under the category of Works Contract Services for construction of sewerage system including laying of pipes and allied works rendered to Indore Municipal Corporation under JNNURM. - HELD THAT: - The Tribunal held that the question is no longer res integra and that identical factual situations have been decided in favour of contractors by earlier decisions, including reliance on the Larger Bench decision in Lanco Infratech Ltd. and subsequent Tribunal orders. Applying those precedents to the present facts, the construction of sewerage works and laying of pipes for the municipal corporation fall within the scope addressed by those decisions and do not sustain the demand confirmed by the Commissioner. The Tribunal therefore followed the ratio of the cited authorities and set aside the demand made in the impugned order. [Paras 6, 7, 8]Demand of service tax under Works Contract Services in respect of the sewerage and pipe-laying works rendered to Indore Municipal Corporation is not sustainable and is set aside; the appeal is allowed.Consequences of unsustainable demand: interest and penalty - Whether interest and penalties imposed consequent to the demand survive once the tax demand is held unsustainable. - HELD THAT: - The Tribunal held that since the primary demand for service tax was not sustainable, the subsidiary consequences flowing from that demand, namely interest and penalties imposed under the Finance Act, 1994, cannot be sustained. Accordingly, having quashed the tax demand, the Tribunal concluded that there is no basis for the imposition of interest or penalties. [Paras 7]Interest and penalties imposed consequent to the quashed demand do not survive and are set aside.Final Conclusion: Following and applying the ratio of the Larger Bench and subsequent Tribunal decisions, the impugned order confirming service tax demand and imposing interest and penalties was set aside and the appeal allowed.

Fixation of special rate of value addition - time bar / limitation - area-based exemption notifications for North-Eastern region - effect of the Hon'ble Supreme Court decision in Union of India v. VVF Ltd. - treatment of pending refund applications in light of subsequent amendmentsFixation of special rate of value addition - time bar / limitation - effect of the Hon'ble Supreme Court decision in Union of India v. VVF Ltd. - treatment of pending refund applications in light of subsequent amendments - Applications for fixation of special rates filed on 29.09.2010 for FY 2009-10 are not time barred. - HELD THAT: - The Tribunal applied its earlier decision in Hindustan Unilever Ltd. v. Commissioner of CX, ST, Dibrugarh, which relied on the Hon'ble Supreme Court's ruling in Union of India v. VVF Ltd. That Supreme Court decision held that pending refund applications must be decided in accordance with the subsequent notifications/industrial policies (which curtailed the earlier benefit) and treated the subsequent amendments as clarificatory without taking away vested rights. The Tribunal also noted the Gauhati High Court's decision in Jyothi Labs holding that applications made after the Supreme Court's decision were in time. Applying these authorities, the Tribunal held that where applications for fixation of special rate were filed before the Supreme Court's decision (filed on 29.09.2010 and pending as of 22.04.2020), the right to have those pending applications considered was restored by the Supreme Court decision and therefore such applications cannot be rejected on the ground of limitation. The Tribunal accordingly set aside the impugned orders rejecting the applications as time barred and allowed the appeals. [Paras 7, 8]Applications filed on 29.09.2010 for fixation of special rate for FY 2009-10 are not time barred; impugned orders rejecting them on limitation grounds are set aside and appeals are allowed.Final Conclusion: The Tribunal, following its precedent and the Supreme Court's decision in Union of India v. VVF Ltd., held that applications for fixation of special value-addition rates filed before the Supreme Court decision (dated 22.04.2020) cannot be rejected as time barred; impugned orders are set aside and the appeals are allowed.

Extended period of limitation under proviso to Section 73(1) - use of Form 26AS / Income tax return data as sole basis for Service Tax demand - exemption for services rendered to State Government authorities under Serial No. 12A of Notification No. 25/2012 ST - exemption for services to registered charitable trusts under Serial 13(c) of Notification No. 25/2012 ST - revenue neutrality / availability of Cenvat credit and its effect on demandExtended period of limitation under proviso to Section 73(1) - use of Form 26AS / Income tax return data as sole basis for Service Tax demand - Whether the extended period of limitation could be invoked and a demand sustained when proceedings were initiated on the basis of Form 26AS / ITR figures without independent positive evidence of suppression or mens rea - HELD THAT: - The Tribunal held that invocation of the extended period is not justified where all material facts were within the knowledge of the Department and there is no positive evidence of suppression or fraudulent intent. Reliance was placed on the Supreme Court principle that where facts are within departmental knowledge, extended limitation cannot be invoked. The Tribunal further observed that revenue cannot frame a demand solely on the basis of differences in Form 26AS/ITR without examining the nature of the amounts or establishing that the amounts represented consideration for taxable services; cited precedents of coordinate benches to support that Form 26AS alone is insufficient to determine Service Tax liability. The notice in the present case (issued 22.12.2020) sought tax for 2015 16 and 2016 17, hence beyond the normal limitation period; in absence of ingredients warranting extended limitation, the demand was unsustainable. [Paras 9, 10]Extended period could not be invoked and the demand based solely on Form 26AS/ITR differences was set aside as barred by limitation.Exemption for services rendered to State Government authorities under Serial No. 12A of Notification No. 25/2012 ST - revenue neutrality / availability of Cenvat credit and its effect on demand - Whether the construction services rendered to District Welfare Office, District Development Office and Zila Parishad were exempt under Serial No. 12A of Notification No. 25/2012 ST and whether any demand survives on merit given revenue neutrality - HELD THAT: - The Tribunal examined the contracts and found that the services were rendered to State Government authorities (District Welfare Office, District Development Office and Zila Parishad). Such services fall within the exemption provided by Serial No. 12A of Notification No. 25/2012 ST. The Appellate Authority's denial based on the ultimate commercial purpose of the constructed shops did not affect the nature of the recipient; since the services were rendered to State authorities, exemption applies. Further, even if reverse charge arose, availability of Cenvat credit renders the position revenue neutral; following the Supreme Court view that a revenue neutral situation cannot sustain a demand, the Tribunal held the demands unsustainable on merits. [Paras 11, 12]Services to the three State authorities are exempt under Serial No. 12A and the related demands do not survive on merits (including by reason of revenue neutrality).Exemption for services to registered charitable trusts under Serial 13(c) of Notification No. 25/2012 ST - Whether construction services rendered to M/s World Vision India (a registered charitable trust) are exempt under Serial 13(c) of Notification No. 25/2012 ST and whether a technical discrepancy in the trust's name defeats the exemption claim - HELD THAT: - The Tribunal found that M/s World Vision India is registered as a charitable trust under Section 12AA of the Income tax Act and that the construction services to it are covered by Serial 13(c) of Notification No. 25/2012 ST. The Appellate Authority had denied exemption on a technicality that the Certificate named the trust as 'World Vision of India' whereas exemption was claimed for 'World Vision India'. The Tribunal accepted the evidence proving both names denote the same entity and held the appellant entitled to the exemption. [Paras 13]Services to World Vision India are exempt under Serial 13(c); the technical name discrepancy does not defeat the exemption.Penalty and interest consequent on unsustainable demand - Whether interest and penalty could be sustained once the underlying demand of service tax was held unsustainable - HELD THAT: - Having concluded that the substantive demands were unsustainable both on limitation and on merits (exemptions/revenue neutrality), the Tribunal held that consequential interest and penalties could not be imposed. The orders imposing interest and equal amount penalties were therefore set aside along with the demand. [Paras 14]Interest and penalty set aside as they flowed from an unsustainable demand.Final Conclusion: The impugned order confirming Service Tax demand (including interest and penalty) for 2015 16 and 2016 17 was set aside: extended limitation could not be invoked where demand was premised solely on Form 26AS/ITR without evidence of suppression; the contracts with State authorities were held exempt under Serial No. 12A, services to World Vision India were held exempt under Serial 13(c), and consequential interest and penalties were quashed; the appeal was allowed.

Wilful disobedience of court order - contempt of court - refund of unutilised Input Tax Credit - disbursement of refund with interest - effect of appellate order on adjudicationWilful disobedience of court order - contempt of court - disbursement of refund with interest - Whether the Adjudicating Authority wilfully failed to implement this Court's order dated 08.05.2023 directing disbursement of the petitioner's refund claims with interest and whether contempt proceedings should be initiated. - HELD THAT: - The petitioner had earlier succeeded before the Appellate Authority and this Court in W.P.(C) No. 5722/2023, where this Court directed forthwith disbursement of the petitioner's refund claim along with interest (paragraph 24 of the earlier order). Despite that clear and unambiguous directive, the Adjudicating Authority recommenced adjudication and has partly rejected the petitioner's claim without processing the disbursement ordered by this Court. The court is prima facie of the view that such conduct amounts to a wilful failure to implement the Court's direction and cannot be justified by a proposal to file an appeal. In consequence, the Court issued notice to the respondent to show cause why contempt proceedings should not be initiated, accepted notice on behalf of the respondent, and directed the concerned Deputy Commissioner to remain present in Court on the next date. [Paras 10, 11, 13]Notice to show cause issued to the respondent for wilful disobedience of the order dated 08.05.2023; respondent accepts notice and is to obtain instructions; the Deputy Commissioner is directed to appear; matter listed on 18.12.2023.Final Conclusion: The High Court, satisfied prima facie that the Adjudicating Authority wilfully disobeyed the earlier direction to disburse the petitioner's refund with interest, issued notice to show cause for contempt, directed the concerned officer to appear and listed the matter for further hearing.

Deduction under section 80P(2)(a)(i) - Character of income attributable to cooperative activities - Investments of surplus funds and eligibility for deduction - Distinguishing Totgars Cooperative Sale Society Ltd. (Totgars) on facts - Precedential weight of jurisdictional High Court decisionDeduction under section 80P(2)(a)(i) - Investments of surplus funds and eligibility for deduction - Character of income attributable to cooperative activities - Distinguishing Totgars Cooperative Sale Society Ltd. (Totgars) on facts - Allowability of deduction under section 80P(2)(a)(i) in respect of interest income on deposits with District Central Cooperative Bank and other banks. - HELD THAT: - The Tribunal examined whether interest earned on deposits (including deposits with DCCB and nationalised banks) formed part of profits and gains of business attributable to activities listed in section 80P(2)(a). It distinguished the facts of Totgars where funds belonging to members were retained and invested and therefore characterised as not business income. Relying on the reasoning of the jurisdictional High Court in Vavveru Cooperative Rural Bank Ltd. and coordinate bench precedents (Kakateeya and others), the Tribunal held that where the original source of the investments is the income derived from activities enumerated in clause (a), the character of such income is not lost merely because the society invested surplus funds in banks. The Court gave effect to the statutory wording "attributable to" and accepted that income from such investments is allowable as a deduction under section 80P(2)(a)(i) when the investments proceed from amounts generated by the cooperative activities specified therein. Applying these principles to the facts, the Tribunal found no infirmity in the CIT(A)'s deletion of the addition made by the AO. [Paras 8, 11, 12, 13]The addition of Rs. 2,59,54,906 relating to interest income was deleted and deduction under section 80P(2)(a)(i) is allowable.Deduction under section 80P(2)(a)(i) - Character of income attributable to cooperative activities - Distinguishing Totgars Cooperative Sale Society Ltd. (Totgars) on facts - Allowability of deduction under section 80P(2)(a)(i) in respect of dividend income claimed by the assessee. - HELD THAT: - The Tribunal addressed the AO's disallowance of dividend income on the same statutory footing as the interest issue. Following the same reasoning - that income retained and invested which is originally derived from activities enumerated in clause (a) retains the character of being attributable to those cooperative activities - the Tribunal agreed with the CIT(A) and the jurisdictional High Court authorities that such dividend income is eligible for deduction under section 80P(2)(a)(i) in the facts of this case. The Totgars decision was held to be distinguishable on factual matrix and not applicable to the assessee. [Paras 8, 11, 12, 13]The addition of Rs. 3,70,365 relating to dividend income was deleted and deduction under section 80P(2)(a)(i) is allowable.Final Conclusion: Following the jurisdictional High Court decision and coordinate bench precedents, the Tribunal upheld the CIT(A)'s deletion of the additions; the revenue's appeal is dismissed and the assessee's cross objections are rendered infructuous and dismissed.

Invocation of extended period of limitation under proviso to Sec. 73(1) of the Finance Act, 1994 - limitation - use of Form 26AS/Income Tax return data as sole basis for demanding service tax - requirement of positive evidence of suppression or mens rea to invoke extended limitation - consequential unsustainability of interest and penalty where demand is barred by limitationInvocation of extended period of limitation under proviso to Sec. 73(1) of the Finance Act, 1994 - requirement of positive evidence of suppression or mens rea to invoke extended limitation - Whether the extended period of limitation could be invoked to sustain the service tax demand - HELD THAT: - The Tribunal found that the Department based the demand on information from Form 26AS and had not produced positive evidence of suppression, concealment or any malafide intention on the part of the appellant. Relying on the principle that extended limitation cannot be invoked where the relevant facts were already within the knowledge of the Department, the Tribunal held that none of the ingredients necessary to attract the proviso to Sec. 73(1) were established. Consequently, the extended period of limitation could not be invoked to validate the demand for the period in question. [Paras 6, 7]Extended period of limitation could not be invoked and the demand was barred by limitation.Use of Form 26AS/Income Tax return data as sole basis for demanding service tax - limitation - Whether the Service Tax Department could sustain a demand solely on the basis of figures reflected in Form 26AS/Income Tax returns without verifying the nature of receipts - HELD THAT: - The Tribunal observed that the Department had not undertaken verification to ascertain whether amounts shown in Form 26AS represented consideration for taxable services. Citing precedents to the effect that differential figures in Form 26AS/ITR cannot, by themselves, establish service tax liability without examination of the nature of receipts, exemptions or abatements, the Tribunal held that reliance solely on Form 26AS to raise the demand was impermissible and could not support invocation of extended limitation. [Paras 7]Demand based solely on Form 26AS/ITR figures without verification was unsustainable.Consequential unsustainability of interest and penalty where demand is barred by limitation - Whether interest and penalty could be sustained where the primary demand was held to be time-barred - HELD THAT: - Having held the primary demand to be barred by limitation and unsustainable, the Tribunal reasoned that consequential claims for interest and imposition of penalty could not survive. The absence of a sustainable tax demand removes the foundation for interest and penalty under the impugned order. [Paras 7, 8]Interest and penalty were not payable once the demand was set aside as time-barred.Final Conclusion: Impugned order confirming service tax demand, interest and penalty set aside on the ground of limitation; appeal allowed.

Limitation - date of receipt of order in original - acceptance of affidavit to fix date of receipt - remand for decision on merits - service tax demand - use of Form 26AS/income tax data for raising service tax demand - extended period of limitation - requirement of evidence to establish taxable nature of receiptsLimitation - date of receipt of order in original - acceptance of affidavit to fix date of receipt - The appeal was filed within time if 17.01.2023 is treated as the date of receipt of the Order in Original; the Tribunal accepted the affidavit and set aside the Commissioner (Appeals) order rejecting the appeal as time barred. - HELD THAT: - The Appellant produced a notarised affidavit stating non receipt of the show cause notice and the Order in Original and asserting that the OIO was received on 17.01.2023. On examination of the affidavit and the chronological events, the Tribunal was satisfied to accept 17.01.2023 as the date of receipt of the OIO. Consequently, since the appeal to the Commissioner (Appeals) was filed within the time prescribed from that date, the appellate rejection on limitation grounds was not sustained. The impugned order rejecting the appeal as barred by limitation was therefore set aside and the matter remitted for adjudication on merits. [Paras 8, 9]Affidavit accepted; 17.01.2023 treated as date of receipt of OIO; impugned order rejecting the appeal on limitation grounds set aside; matter remanded to Commissioner (Appeals) to decide on merits.Service tax demand - use of Form 26AS/income tax data for raising service tax demand - extended period of limitation - requirement of evidence to establish taxable nature of receipts - remand for decision on merits - The merits of the service tax demand, including the invocation of extended period of limitation and reliance on Form 26AS/Income Tax returns, were not decided and are remanded to the Commissioner (Appeals) for fresh consideration on merits. - HELD THAT: - The Tribunal did not adjudicate the substantive contentions advanced by the Appellant regarding limitation under proviso to Section 73(1), the use of Form 26AS or ITR figures as sole basis for a service tax demand, or the absence of evidence of mens rea. Instead, having found the appeal to be maintainable, the Tribunal set aside the appellate order and remitted the entire matter to the Commissioner (Appeals) to hear the Appellant and decide these contentions on their merits. The remand requires the Commissioner (Appeals) to examine whether the department has independent evidence to establish that the amounts reflected in income tax data represent consideration for taxable services and whether requirements for invoking the extended period of limitation are satisfied. [Paras 8, 9]Substantive dispute on service tax liability and limitation remanded to the Commissioner (Appeals) for fresh hearing and decision on merits.Final Conclusion: The Tribunal accepted the Appellant's notarised affidavit, treated 17.01.2023 as the date of receipt of the Order in Original, set aside the Commissioner (Appeals) order rejecting the appeal as time barred, and remanded the matter to the Commissioner (Appeals) to hear the Appellant and decide the service tax demand and related limitation issues on merits.

CENVAT credit on commission to foreign agent - sales promotion versus effecting of sale - admissibility of credit under Section 2(L) of the CENVAT Credit Rules, 2004 - remand for fresh adjudication - requirement of reasoned appellate finding CENVAT credit on commission to foreign agent - sales promotion versus effecting of sale - admissibility of credit under Section 2(L) of the CENVAT Credit Rules, 2004 - Whether the claim for CENVAT credit in respect of commission paid to a foreign agent is admissible or requires fresh adjudication - HELD THAT: - The court found that the Tribunal reversed the adjudicating authority's findings without giving reasons and equated payments to a foreign agent with services rendered by clearing and forwarding agents without adequate analysis. Given the doubt recorded by the High Court about the manner in which the CESTAT reached its conclusion, the matter cannot be finally resolved on the existing record. The Supreme Court observed that the nature of the agreement between the assessee and the agent and the invoices evidencing payments are relevant to determine whether the payments were for sales promotion and thus eligible for CENVAT credit under Section 2(L) of the CENVAT Credit Rules, 2004. Consequently, the matter is remitted to the CESTAT for fresh consideration, permitting the appellant to place relevant documents on record and allowing the Department an opportunity to respond. All other contentions have been left open for decision by the CESTAT on reconsideration. Remanded to CESTAT for fresh adjudication on the admissibility of CENVAT credit in respect of commission paid to the foreign agent, with liberty to the assessee to file additional documents and to the Department to reply. Remand for fresh adjudication - requirement of reasoned appellate finding - Validity of the impugned orders of the High Court and the CESTAT insofar as they decided the point of commission paid to the foreign agent - HELD THAT: - For the limited purpose of the commission claim, the Supreme Court set aside the observations and conclusions of the High Court and the CESTAT because the appellate tribunal had not furnished reasons for reversing the adjudicating authority and had not conducted a proper fact based inquiry. The Court directed that the impugned orders be set aside to the extent they deal with the commission to the foreign agent and remitted the matter for fresh decision. The appeals were allowed on this limited ground and all other contentions were left open for determination by the CESTAT. High Court and CESTAT orders set aside to the extent of the observations on commission paid to the foreign agent; appeals allowed and matters remanded for fresh adjudication. Final Conclusion: The Supreme Court allowed the appeals in part, set aside the High Court's and CESTAT's observations on the claim for CENVAT credit on commission paid to a foreign agent, and remitted the matter to the CESTAT for fresh consideration permitting the assessee to file relevant documents and the Department to respond; all other contentions left open.