Issues: Whether promotional and market-survey services performed in India for a foreign principal constituted export of services and entitled the service provider to refund of service tax.

Analysis: Rule 3(2)(a) of the Export of Service Rules, 2005 requires that the service be provided from India and used outside India. Circular No. 111/5/2009-ST clarifies that, for Category III services, the relevant consideration is the location of the service recipient and whether the benefit of the service accrues outside India, rather than the place where activities are performed. The promotional activities were performed exclusively for the foreign entity, which received the business benefit of promotion of its goods, notwithstanding that its products were ultimately sold to Indian buyers. The settled treatment of Business Auxiliary Services involving promotion of a foreign principal's market in India also recognises such services as export of services.

Conclusion: The promotional services constituted export of services, and the appellant was entitled to consequential refund relief.

Issues: Whether transportation of goods by road without issuing consignment notes is taxable as a service rendered by a goods transport agency.

Analysis: Section 65B(26) of the Finance Act, 1994 defines a goods transport agency as a person providing road-transport services who issues a consignment note. Section 66D(p)(i) places transportation of goods by road in the negative list, except services provided by a goods transport agency or courier agency. The transportation activity was undertaken without issuance of consignment notes and therefore did not satisfy the statutory definition of a goods transport agency.

Conclusion: The road-transport services fell within the negative list and were not liable to service tax; the issue is decided in favour of the assessee. The tax demand and consequential interest and penalty do not survive.

Issues: (i) Whether Section 16(2)(c) of the Central Goods and Services Tax Act, 2017 can be read down for a bona fide purchaser; (ii) Whether the recipient proved that the suppliers paid tax and whether non-compliance with Circular No. 183/15/2022-GST dated 27.12.2022 caused prejudice; (iii) Whether the recipient established actual movement and receipt of the goods; (iv) What tax, interest, and penalty are payable.

Issue (i): Whether Section 16(2)(c) of the Central Goods and Services Tax Act, 2017 can be read down for a bona fide purchaser.

Analysis: Input tax credit is a statutory entitlement subject to cumulative conditions. Section 16(2)(c) requires actual payment of tax to the Government, while Section 155 places the burden of proof on the claimant. The subsequently declared binding position under Article 141 of the Constitution of India requires the provision to be applied as enacted; payment to the supplier does not itself establish payment to the Government.

Conclusion: Section 16(2)(c) cannot be read down for a bona fide purchaser; the issue is against the assessee.

Issue (ii): Whether the recipient proved that the suppliers paid tax and whether non-compliance with Circular No. 183/15/2022-GST dated 27.12.2022 caused prejudice.

Analysis: A mismatch between FORM GSTR-3B and FORM GSTR-2A alone does not establish non-payment by a supplier. The Circular prescribes verification of the invoice, receipt, and payment to the supplier, followed, for a supplier-wise difference below Rs. 5 lakh, by a supplier certificate confirming tax payment. No supplier certificate, supplier return, accountant certificate, or other reliable evidence of actual payment of tax was produced. Any initial failure to follow the Circular caused no procedural prejudice because repeated opportunities to furnish the prescribed proof were available.

Conclusion: The recipient failed to prove actual payment of tax by the suppliers, and Section 16(2)(c) remains unsatisfied; the issue is against the assessee.

Issue (iii): Whether the recipient established actual movement and receipt of the goods.

Analysis: For the inter-State supply in question, Rule 138 of the Central Goods and Services Tax Rules, 2017 required an e-way bill. Absence of an e-way bill does not by itself deny input tax credit, but where it is unavailable, proof of movement of goods must be supplied through other reliable contemporaneous records. No e-way bill, transport document, freight record, goods-receipt note, or stock record was produced, and the export documentation did not reliably link the goods exported with the goods stated to have been purchased.

Conclusion: Actual movement and receipt of the goods were not established; the issue is against the assessee.

Issue (iv): What tax, interest, and penalty are payable.

Analysis: The disallowed input tax credit follows from failure to meet Section 16(2)(c). Interest under Section 50(3) is compensatory and arises only on credit wrongly availed and utilised; its computation must conform to Rule 88B(3) of the Central Goods and Services Tax Rules, 2017. The penalty under Section 73(9), read with Section 122(2)(a), is a mandatory statutory penalty independent of fraud or intent to evade.

Conclusion: Tax of Rs. 1,35,231 and penalty of Rs. 33,266 are sustained. Interest liability is sustained only upon computation of wrongly availed and utilised credit under Rule 88B(3); the issue is against the assessee.

Final Conclusion: Input tax credit remains unavailable without proof that the suppliers paid tax to the Government, while recoverable interest must be confined to the statutory computation of credit actually utilised.

Ratio Decidendi: A claimant of input tax credit bears the burden of proving actual payment of tax by the supplier under Section 16(2)(c); an invoice, bank payment, or GSTR-2A mismatch alone is insufficient, though a mismatch cannot by itself establish supplier default.

Issues: Whether interest paid to a statutory corporation established under a Central Act was subject to tax deduction at source under section 194A of the Income-tax Act, 1961, thereby rendering the payer an assessee in default under sections 201(1) and 201(1A).

Analysis: Section 194A(3)(iii)(f) of the Income-tax Act, 1961 excludes payments to institutions notified by the Central Government. Notification No. S.O. 3489 dated 22.10.1970 covers every corporation established by a Central, State or Provincial Act. As the National Highways Authority of India was established under section 3 of the National Highways Authority of India Act, 1988, it fell within the notified category. CBDT Circular No. 18/2017 dated 29.05.2017, concerning entities with unconditional income-tax exemption, could not restrict the separate statutory exemption under the notification or render it redundant.

Conclusion: The interest payment was not liable to tax deduction at source under section 194A of the Income-tax Act, 1961. The payer could not be treated as an assessee in default, and the demand under section 201(1) with consequential interest under section 201(1A) was deleted.

Issues: Whether the enhanced 60% tax rate under Section 115BBE of the Income-tax Act, 1961 applied to additional income declared for Financial Year 2016-17, corresponding to Assessment Year 2017-18.

Analysis: The amendment enhancing the rate under Section 115BBE from 30% to 60% took effect from 01.04.2017. For Financial Year 2016-17, the applicable law was that in force on 01.04.2016; the enhanced rate operated prospectively from Financial Year 2017-18.

Conclusion: The enhanced 60% rate under Section 115BBE was inapplicable to the declared additional income for Assessment Year 2017-18; tax was required to be levied at the normal applicable rates.

Issues: Whether books of account could be rejected under Section 145(3) of the Income-tax Act, 1961 and income estimated at 8% solely because the turnover reported in GSTR-9C exceeded the turnover reflected in the books, where part of the GST turnover represented agency sales of a Kachha Arhatia.

Analysis: Rejection of books under Section 145(3) of the Income-tax Act, 1961 requires defects affecting their correctness or completeness. The audited books contained no identified defects in purchases, sales, stock, expenses, vouchers, or ledgers. The turnover reconciliation separately identified agency sales and reconciled the balance with trading sales, commission income, and intra-day trading profit. CBDT Circular No. 452 dated 17.03.1986 recognises that sales effected by a Kachha Arhatia on behalf of principals do not constitute the agent's turnover, with only gross commission being relevant. Further, the 8% profit rate lacked support from comparable cases, past results, or other material.

Conclusion: The rejection of books and consequential 8% income estimation were unsustainable; the returned income was required to be accepted.

Issues: Whether the sale proceeds received on transfer of shares could be treated as unexplained cash credit.

Analysis: The assessee substantiated ownership and sale of the shares through the share-purchase agreement, signed share certificate, register and annual-return records, dematerialisation records, demat statements, foreign inward-remittance certificate, and banking-channel receipt from the purchaser. These materials established both the source and nature of the credit. The unsigned share certificate initially produced did not displace the corroborative documentary evidence. Once the assessee discharged the primary onus, the assessing authority could not invoke the unexplained-credit provision without conducting independent verification of the evidence.

Conclusion: The sale consideration was explained and could not be assessed as unexplained cash credit; the deletion of the addition was sustained in favour of the assessee.

Issues: Whether penalty for delayed furnishing of the statement of financial transactions could be sustained without examining the statutory defence of reasonable cause.

Analysis: Delayed furnishing of the statement of financial transactions may attract Section 271FA of the Income-tax Act, 1961, but Section 273B of the Income-tax Act, 1961 requires examination of whether reasonable cause existed. The delayed filing alone does not conclusively determine the applicability of the penalty provision. As no explanation or supporting evidence concerning the delay had been examined on merits, a reasonable opportunity to establish reasonable cause was necessary.

Conclusion: The dismissal without a merits examination cannot stand; reasonable cause must be adjudicated before determining the penalty. The issue is decided in favour of the assessee.

Issues: Whether penalty for under-reporting of income in consequence of misreporting was sustainable where the reassessment accepted the income returned by the assessee and the penalty order did not establish the applicability of any clause of section 270A(9).

Analysis: Section 270A differentiates under-reporting from misreporting and permits the enhanced penalty only where the case falls within a specified circumstance under section 270A(9). The reassessment accepted the income declared in the return filed in response to notice under section 148 without any addition or variation. The penalty order did not identify the applicable clause of section 270A(9) or demonstrate satisfaction of its ingredients. Mere withdrawal of a deduction claim during reassessment, without further material establishing misrepresentation or suppression, does not conclusively establish misreporting.

Conclusion: The penalty for misreporting was unsustainable and was deleted, in favour of the assessee.

Issues: Whether disallowance of expenditure relating to exempt income under Section 14A read with Rule 8D could exceed the exempt income earned for Assessment Year 2018-19, and whether the Finance Act, 2022 amendment applied retrospectively.

Analysis: The exempt income was Rs. 24,000, against which an equivalent suo motu disallowance had already been made. The established position limits disallowance under Section 14A read with Rule 8D to the exempt income earned. The Finance Act, 2022 amendment took effect from 1 April 2022 and applied from Assessment Year 2022-23 onwards; it did not apply to Assessment Year 2018-19.

Conclusion: No further disallowance under Section 14A read with Rule 8D was warranted beyond Rs. 24,000 already disallowed by the assessee.

Issues: Whether interest paid on overdrafts obtained against fixed deposits was deductible while computing income from other sources.

Analysis: Section 57(iii) permits deduction of expenditure incurred wholly and exclusively for earning income assessable under the head income from other sources. The claimed interest expenditure required a direct nexus with the interest income. Although interest income was earned on fixed deposits, the purpose for which the overdraft funds were utilised and their linkage with earning such income were not substantiated.

Conclusion: The interest expenditure was not deductible under Section 57(iii) of the Income-tax Act, 1961.

Issues: Whether the assessment of income at 8% of the cash deposits required fresh appellate consideration after permitting the assessee to substantiate the claimed profit margin from the petroleum-products business.

Analysis: Prior non-compliance before the assessing and first appellate authorities was noted. The stated lower profit margin and the request to produce cogent supporting material warranted a fresh opportunity in the interests of justice.

Outcome: The matter was remitted to the first appellate authority for fresh decision after granting reasonable opportunity to the assessee.

Issues: Whether non-compliance with the document-submission requirement for finalisation of a project import contract disentitled the importer to concessional nil duty.

Analysis: Regulation 7 of the Project Import Regulations, 1986 requires finalisation documents to be furnished within three months of clearance of the last consignment or within an extension allowed by the proper officer. The extension request remained undisposed of, the Department did not establish the date of last clearance from which the prescribed period was to run, and the requisite documents had been furnished before issuance of the show-cause notices. The finding that no extension was sought and that the reconciliation statement was not furnished was contrary to the record. The applicable Board circular concerning relaxation of project-import requirements for public sector undertakings was also not properly considered.

Conclusion: Non-compliance with Regulation 7 was not established, and denial of the concessional nil-duty benefit was unsustainable.

Issues: (i) Whether an individual shop owner, whose intervention application had been disposed of and who had been permitted to pursue grievances only in a representative capacity, had locus to challenge the final class-wide order; (ii) Whether rejection of a post-reservation application seeking to introduce additional material warranted appellate interference with the final order.

Issue (i): Whether an individual shop owner, whose intervention application had been disposed of and who had been permitted to pursue grievances only in a representative capacity, had locus to challenge the final class-wide order.

Analysis: Sections 241 and 242 of the Companies Act, 2013 provide remedies concerning oppression and mismanagement affecting the company and its stakeholders. The intervention application had been heard and effectively disposed of, with liberty to shop owners to pursue grievances collectively in a representative capacity. That representative avenue was not availed. The final directions governed restructuring of shareholding, determination of dues, management, and a general body meeting for the shareholder class as a whole, rather than any individual shop owner. The non-disclosure of the earlier intervention order and repeated individual proceedings also demonstrated an impermissible multiplication of litigation.

Conclusion: The appellant lacked locus standi to maintain an individual challenge to the class-wide final order.

Issue (ii): Whether rejection of a post-reservation application seeking to introduce additional material warranted appellate interference with the final order.

Analysis: The company petition had been extensively heard, written submissions had been received, and the matter had been reserved for orders before the application was filed. Reception of new factual material at that stage would deny the opposing parties an opportunity to rebut it and offend principles of natural justice. The application also sought substantial directions in proceedings instituted by others. The interim arrangement under Section 242(2)(k) of the Companies Act, 2013 stood subsumed in the final directions, and the material on record did not support the assertion that the entire mall was destroyed or incapable of repair.

Conclusion: The refusal to reopen the concluded hearing or receive the additional material disclosed no ground for appellate interference.

Final Conclusion: The class-wide framework governing share entitlement, dues, management, and stakeholder decision-making remains operative; material non-disclosure and repetitive individual litigation attracted exemplary costs of Rs. 5 lakhs.

Ratio Decidendi: In representative oppression and mismanagement proceedings, an intervenor who was afforded but did not pursue a representative remedy cannot use individual proceedings to reopen a concluded hearing or separately challenge final relief operating for the stakeholder class.

Issues: Whether the direction requiring access to the bank's Secretarial Portal and electronic data stored on its servers and devices was sustainable.

Analysis: Inspection and disclosure are confined to material on the regulator's record and relied upon in the proceedings. The portal and electronic data were neither in the regulator's possession nor on its record, and the hearing notice expressly stated that they would not be relied upon. A prior final order had also declined inspection of comparable material that was not on record or part of the relevant report. The request did not identify specific documents with clarity and precision, while blanket access could compromise confidential third-party information. The reports and documents relied upon in the proceedings had already been supplied.

Conclusion: The direction granting inspection and access to the Secretarial Portal and electronic data was unsustainable; disclosure remains confined to the material on record and relied upon in the proceedings.

Issues: Whether leasing an excavator with an exclusive right to use, on which VAT was paid, was liable to service tax as supply of tangible goods service.

Analysis: Section 66E(f) of the Finance Act, 1994 covers hiring or leasing of goods without transfer of the right to use them. The lease terms granted the lessee exclusive control and right to use the excavator, while responsibility for its operation, maintenance and associated expenses rested with the lessee. The consideration received for this transfer was subjected to VAT. The transaction therefore constituted a deemed sale involving transfer of the right to use the equipment, rather than a taxable supply of tangible goods service.

Conclusion: No service tax was payable on the lease charges for transfer of the right to use the excavator.

Issues: Whether the consideration received under the agreement for construction of a residential house was exempt from service tax.

Analysis: Sl. No. 14(b) of Notification No. 25/2012-ST dated 20.06.2012 exempts original works pertaining to a single residential unit otherwise than as part of a residential complex. The recorded agreement and the acknowledged contract value established that the entire receipt related to construction of the residential house. The inability of the service recipient to explain the mode of payment could not, by itself, establish that any part of the receipt was consideration for distinct taxable works.

Conclusion: The entire consideration was exempt from service tax; consequently, no tax or penalty was payable, in favour of the assessee.

Issues: Whether the appellant was liable to service tax and penalty for transportation of goods by road where the service recipient had discharged tax under the reverse charge mechanism.

Analysis: The undisputed activity was transportation of goods by road, and the service recipient had discharged service tax under the reverse charge mechanism. The absence of a consignment note, coupled with such tax payment by the recipient, supported the absence of any further service-tax liability upon the provider.

Conclusion: The appellant bore no service-tax liability, and the demand and penalty were unsustainable.

Issues: (i) Whether an excise-duty demand can rest solely on an ER-6 return without examining the ER-1 return or evidence of clearance of the alleged discrepant goods; (ii) Whether the extended limitation period was invocable when the Department had knowledge of the ER-6 return and the appellant's explanation in 2012.

Issue (i): Whether an excise-duty demand can rest solely on an ER-6 return without examining the ER-1 return or evidence of clearance of the alleged discrepant goods.

Analysis: The demand was founded on the figures in the ER-6 return without cross-verification against the ER-1 return, which was also available on record. No independent material established suppression, clandestine clearance, or removal of the alleged discrepant quantity. A discrepancy in one return, without examining the corresponding statutory return or supporting evidence of clearance, did not establish excise-duty liability.

Conclusion: The demand could not be sustained solely on the ER-6 return in the absence of examination of the ER-1 return and evidence of clearance of the alleged discrepant goods; decided in favour of the assessee.

Issue (ii): Whether the extended limitation period was invocable when the Department had knowledge of the ER-6 return and the appellant's explanation in 2012.

Analysis: The ER-6 return had been filed in 2012 and formed the basis of the Spot Memo, which was answered by the appellant. The relevant facts were therefore within departmental knowledge, and no suppression justifying invocation of the extended period was established. The show-cause notice issued on 20.05.2015 was consequently time-barred.

Conclusion: The extended period of limitation was not invocable; decided in favour of the assessee.

Final Conclusion: The excise-duty demand and associated penalty lacked a sustainable evidentiary and limitation basis.

Ratio Decidendi: An excise-duty demand cannot be founded solely on a discrepancy in an ER-6 return where corresponding returns are not examined, no evidence of unaccounted clearance exists, and the disclosed material was already within departmental knowledge.