TaxTMI Updates e-Newsletter
Feb 09,2026

Non-speaking order - violation of principles of natural justice - failure to apply mind - opportunity of personal hearing - recording of reasons for rejection of explanation - remand for fresh adjudication - adjudication u/s 74 -HELD THAT:- To the extent in the present facts, the petitioner had filed reply on 19.08.2025. The date fixed for personal hearing should have been fixed thereafter. If the petitioner had failed to appear on such dates only then the matter may have been proceeded ex parte.

The lack of application of mind is apparent on the face of record and requires no discussion by this Court. By making wholly vague and generic observations that he had considered all material available on record or that submission of the noticee is not 'appropriate' or that the noticee has failed to furnish 'all supporting document in respect of its reply dated 19.08.2025', there is no consideration offered to the reply and there is no reasoning given to the fact contentions raised by the petitioner.

If the reply to the show-cause notice was lacking in any part, for which reason the explanation furnished by the petitioner was to be rejected it was incumbent on the adjudicating authority to discuss the same and record his reasons to draw that conclusion.

Accordingly, the impugned order dated 18.12.2025 passed by Sri Braj Kishore Vidyarthi, Assistant Commissioner CGST & Central Excise Division-Azamgarh is set aside. The matter is remitted to the adjudicating authority to pass a fresh order after affording due opportunity of personal hearing to the petitioner. Prima facie, if the adjudicating authority is not convinced with the explanation furnished, it is expected that the petitioner would be given opportunity to explain the doubts that may exist with the adjudicating authority and cogent reasons would be recorded to reject the fact explanation furnished by the petitioner.

With the aforesaid observation, present writ petition is disposed of.

Condonation of delay - limitation period - Section 107(4) of the J&K SGST Act, 2017 / CGST Act, 2017 - extended one-month period for presenting appeal - remand for adjudication on merits - HELD THAT:-In terms of Section 107(4) of the Act, the Appellate Authority, if satisfied that the appellant was prevented from presenting the appeal within the aforesaid period of three months or six months as the case may be, can allow it to be presented within a period of one month, meaning thereby, that if the appellant demonstrates sufficient cause preventing him from presenting the appeal within three months/six months, the appeal can be presented within a further period of one month.

The grounds urged in the Petitioner’s application for condonation of delay can neither be termed as imaginary nor fanciful. Given that the delay was a mere 15 days, Respondent No. 3 erred by adopting a hyper-technical approach to 'knock out' the appeal at the threshold. Such a dismissal is contrary to the spirit of Section 107(4) of the Act, which explicitly permits the condonation of delay within an extended one-month window.

Since the limitation period (after legal exclusions) expired on 12.05.2025, the Respondents’ insistence that the appeal should have been preferred by 07.05.2025 is logically flawed and legally unsustainable; it effectively curtails the statutory period granted to the Petitioner.

Accordingly, we set aside the order dated 19.01.2026 and condone the delay in filing the appeal and remit the matter to respondent No. 3 for adjudication of the appeal on merits.

Invalidity of determination issued against a deceased person - liability of legal representative after death u/s 93 - requirement to issue show cause notice to legal representative before determination - appeal rejected on limitation without adjudicating substantive jurisdictional defect - HELD THAT:- It is not in issue that the firm P.B. Sethi Plastics, is a sole proprietorship firm, whose sole proprietor is Buldeo Raj Sethi. It is also not in dispute and rather admitted to the parties that Buldeo Raj Shethi, the sole proprietor of the firm, expired on 21.07.2020 and post death of the erstwhile sole proprietor Buldeo Raj Sethi on 21.07.2020, the application was made on behalf of the sole proprietor that the GST of the firm be surrendered and cancelled and the order came to be passed on 07.10.2020. It is also not in dispute that the proceedings under Section 73 of the Act came to be initiated against the sole proprietorship firm, whose sole proprietor was the deceased Buldeo Raj Sethi, while issuing the show cause notice dated 21.09.2023 and the order under Section 73 of the Act came to be passed by the original authority on 20.12.2023. The appeal came to be filed questioning the order passed under Section 73 of the Act dated 20.12.2023 before the appellate authority, which came to be rejected on 26.06.2025 by the appellate authority.

Meaning thereby that even otherwise, it was not humanly possible that even on due diligence, the writ petitioner should have obtained knowledge about passing of the order under Section 73 of the Act on 20.12.2023, particularly when, GST registration was cancelled. More so, the issue is on a larger aspect. Whether the proceedings emanating from the issuance of show cause notice dated 21.09.2023 and passing of an order under Section 73 of the Act could have been passed on 20.12.2023 against a dead person or not.

Since the entire proceedings under Section 73 of the Act was initiated against a dead person, then the legal issue so raised by the writ petitioner in the appeal has not been considered while dismissing the appeal on limitation, thus the order impugned cannot be sustained.

With the aforesaid observations, the writ petition stands disposed of.

Revocation of cancellation of GST registration - filing of statutory returns after revocation of registration - payment of tax dues in instalments u/s 80 - defreezing of bank accounts conditional on filing applications and furnishing security - security under Rule 159(5) of the Assam GST Rules, 2017 - adjustment of interim payments against outstanding tax liability - administrative disposal of applications within prescribed time-frame - HELD THAT:- It is stated that the GST Registration of the Firm was cancelled vide Order dated 15.09.2021, bearing Reference No. ZA180921017315O. And once GST registration is cancelled, the GST portal disables filing of regular returns i.e. GSTR-1 & GSTR-3B and it is a system driven restriction. Therefore the petitioners are not in a position to file the pending monthly returns for the remaining part of FY 2021-22 and the subsequent period thereafter. But, the basic relationship between GSTR-1 and GSTR-3B is that GSTR-1 is a return of outward supplies containing invoice wise details of taxable supplies, Zero rated supplies, exempted/nil rated supplies including debit note/credit notes and GSTR-3B is a summary return for self-assessed tax liability and payment of tax made and also claim of input tax credit (ITC). And unless cancellation of the GST is revoked the petitioners are not in a position to file the necessary returns and the correct GST dues of the petitioner firm and also it would not be in a position to clear the outstanding amount unless the ban accounts are defreeze.

This Court is inclined to dispose of this petition by granting liberty to the petitioners to file an application for revocation of the GSTIN cancellation and thereafter, to file an application for allowing them to file return and also to file an application under Section 80 of the CGST Act, 2017, allowing them to clear the liability in installments and on such application being filed, the bank accounts of the petitioners shall be defreezed.

However, this deferezing is subject to the condition that the petitioners shall file sufficient security in terms of Rule 159(5) of the Assam GST Rule, 2017.

The petitioners are granted one week time to file the application, as mentioned hereinabove, and on such application being filed, the respondent authorities, within a period of two weeks, shall dispose of the same.

Input Tax Credit denial linked to supplier's non-filing of Form GSTR-3B - travel beyond the confines of the notice to show cause - statutory limitation on adjudication to grounds in notice to show cause under Section 75(4) and second proviso to Section 107(11) of the said Act of 2017 - obligation to afford opportunity to rebut grounds not raised in notice (audi alteram partem) - remand for fresh decision after affording opportunity of hearing - HELD THAT:- It is noticed that the only point canvassed in the notice to show cause that formed the foundation of the proceeding under Section 73(1) of the said Act of 2017 initiated against the petitioner was that the petitioner’s supplier had not filed its return in Form GSTR-3B for the months of August, 2019 to October, 2019.

Since, that was the only issue, therefore upon the returns for the months of August, 2019 and September, 2019 being filed by the petitioner’s supplier, the proper officer/adjudicating authority dropped the demands in respect of the aforesaid months and confirmed the demand in so far as the October, 2019 is concerned, (as no return had been filed in respect of the said month even during the pendency of the adjudication proceedings).

Upon the return being filed even in respect of October, 2019, during the pendency of the appellate authority proceeding, there was no reason for the appellate authority to not adopt the same standard that had been adopted by the proper officer/adjudicating authority. The appellate authority has tried to upset the petitioner’s case on certain grounds which were never raised against the petitioner in the notice to show cause.

It is settled that any adjudicating authority whether original or appellate cannot travel beyond the confines of the notice to show cause and an order passed on grounds extraneous to the notice to show cause would be become vulnerable on that score alone.

Such principle has been given statutory recognition both in Section 75(4) as well as the second proviso to Section 107(11) of the said Act of 2017.

In such view of the matter, the appellate order dated 23rd October 2024, impugned herein is set aside.

Right to access seized documents and electronic evidence - principles of natural justice / right to fair hearing - adjudication u/s 74 of the WBGST/CGST Act, 2017 - treatment of impugned order as an additional show cause notice - remand for fresh adjudication upon supply of seized material - HELD THAT:-It is not in dispute that the documents and the CPU that had been seized from the custody of the petitioner have not yet been returned to the petitioner.

There is sufficient force in the contention of the petitioner that without the documents and records the petitioner would also not be in a position to prefer a proper appeal before the appellate authority.

Since, the petitioner has not got any meaningful opportunity of participating in the hearing before the proper officer, the order impugned shall be treated as an additional show cause notice. The petitioner shall not be entitled to file a composite reply to the show cause notice earlier issued to the petitioner as well as the additional show cause notice (i.e. the impugned order dated 18th December, 2024 in terms of this order) within a period of two weeks from the date when the petitioner receives the seized documents or copies thereof and the seized CPU.

The petitioner shall approach the proper officer by way of an appropriate application as indicated in the notice dated January 6, 2026 (Annexure R/10 at page 37) of the report in the form of an affidavit within a week from date. Upon the petitioner so approaching the proper officer shall makeover the seized documents (or copies thereof) and the seized CPU to the petitioner within two days thereafter. The proper officer shall thereafter conclude the proceedings by passing appropriate orders upon affording an opportunity of hearing to the petitioner, in accordance with law. It is clarified that this court has not gone into the merits of the matter and all points are left open to the adjudicating authority.

The writ petition being WPA stands disposed of with the above observations.

Benefit of Section 14 of the Limitation Act - abeyance of limitation during pendency of rectification application - rectification u/s 161 of the UPGST Act, 2017 - bonafide pursuit before a wrong forum - maintainability of appeal despite delay - setting aside order rejecting appeal as time barred and directing decision on merits - HELD THAT:- It is not in issue that in the leading writ petition against the order passed by the original authority on 24.04.2024, the writ petitioner preferred an application under Section 161 of the Act on 07.05.2024 for rectification. The said application was rejected by the original authority on 18.09.2024 and the statutory appeal came to be preferred along with delay condonation application on 28.09.2024 which had been rejected by virtue of the order dated 27.10.2024 passed by the appellate authority. The issue whether the period spent while filing rectification application under Section 161 of the Act for the purposes of limitation while preferring an appeal is no more res integra as a Division Bench judgment of this Court in M/s Prakash Medical Stores [2026 (1) TMI 1453 - ALLAHABAD HIGH COURT]

As regards the connected writ petition is concerned against the order of the original authority dated 22.11.2024, the writ petition came to be preferred by the writ petitioner on 04.01.2025 within the time which came to be dismissed as withdrawn with liberty to file an appeal on 15.04.2025 and thereafter the appeal was preferred on 08.05.2025. Thus, in the opinion of the Court, the writ petitioner entitled the benefit of Section 14 of the Limitation Act as he was pursuing his permit bona fidely before a wrong forum.

Since the writ petitioner in the leading writ petition has deposited 10% of the disputed amount by virtue of the interim order dated 02.04.2025 and in the connected writ petition, the writ petitioner claims to have deposited 25% of the disputed amount, thus, the appellate authority shall proceed to decide the appeal while holding it to be maintainable and not barred by delay and latches within a period of two months thereafter.

Accordingly, the writ petitions stand disposed of.

Presumption of constitutionality of subordinate legislation - omnia praesumuntur rite esse acta - power to issue instructions or directions u/s 168 of the CGST Act - assignment of functions to central tax officers - proper officer - Commissioner in the Board - summons u/s 70 -HELD THAT:- A plain reading of the Section 168 contemplates that sub-section (1) empowers the Board, for achieving the purpose and uniformity in the implementation of the Act, to issue such orders, instructions, or directions to the Central Tax Officers as it may deem fit. Thereupon, such officers and all other persons employed in the implementation of the Act are required to observe and follow such orders, instructions, or directions.

No doubt, the petitioner has relied upon sub-section (2) of Section 168 of the CGST Act so as to substantiate his contention that it is the Commissioner in the Board, who is required to route the proposal and the same is required to be approved by the Board, as provided under sub-section (2) of Section 168 of the CGST Act, in the matter of assigning functions by the Commissioner in the Board.

Once it is not in dispute that the Commissioner is part of the Board, and sub-section (2) of Section 168 contemplates that the assignment of functions to the Central Tax Officers is upon a proposal of the Commissioner in the Board, we see no reason to disbelieve that the same was not under the authority of the Commissioner, which was approved by the Board as required under sub-section (2) of Section 168 referred above.

Thus, we see no reason to infer that while issuing the circular dated 5th July, 2017, the proposal was not mooted through the Commissioner in the Board, or that the same was not approved by the Board as defined under sub-section (16) of Section 2 and sub-section (25) of Section 2 of the CGST Act.

We see no reason to cause interference in the matter of testing the validity of the impugned circular dated 5th July, 2017 issued by Government of India.

As regards the issue dealing with the returnable date of the summons is concerned, in view of the statement made by the learned counsel for the respondent, we deem it appropriate to permit the petitioner to appear in compliance with the summons dated 3rd November, 2025 before the competent officer mentioned therein on 23rd March, 2026. The competent officer shall thereafter deal with the issue in accordance with law.

With above observations, we deem it appropriate to partly allow the present writ petition to the extent of rescheduling the date, however, the challenge to the circular fails and to that extent, the petition stands dismissed.

Service by uploading on GST portal - service under Section 169(1) of the GST Act - requirement of effective service and personal hearing - obligation of tax officer to explore alternative modes of service (including RPAD) - remand subject to deposit as condition precedent - HELD THAT:- In the case on hand, it is evident that the show cause notice was uploaded on the GST Portal Tab. According to the petitioner, he was not aware of the issuance of the said show cause notice issued through the GST Portal and the original of the said show cause notice was not furnished to them. In such circumstances, this Court is of the view that the impugned assessment order came to be passed without affording any opportunity of personal hearing to the petitioner, confirming the proposals contained in the show cause notice.

Merely passing an ex parte order by fulfilling the empty formalities will not serve any useful purpose and the same will only pave way for multiplicity of litigations, not only wasting the time of the Officer concerned, but also the precious time of the Appellate Authority/Tribunal and this Court as well.

Thus, when there is no response from the tax payer to the notice sent through a particular mode, the Officer who is issuing notices should strictly explore the possibilities of sending notices through some other mode as prescribed in Section 169(1) of the Act, preferably by way of RPAD, which would ultimately achieve the object of the GST Act. Therefore, this Court finds that there is a lack of opportunities being provided to serve the notices/orders etc., effectively to the petitioner.

This Court is inclined to set aside the impugned order dated 31.01.2024 passed by the respondent.

The impugned order dated 31.01.2024 is set aside and the matter is remanded to the respondent for fresh consideration on condition that the petitioner shall pay 25% of the disputed tax amount to the respondent within a period of four weeks from the date of receipt of a copy of this order. The setting aside of the impugned order will take effect from the date of payment of the said amount

With the above directions, this writ petition is disposed of.

Rectification u/s 161 - assessment u/s 73 - notice u/s 50(1) - statutory appeal subject to deposit of disputed tax for interim relief - vacation of bank attachment conditional on deposit and absence of other arrears - appellate authority may decide on merits notwithstanding limitation - HELD THAT:- In case, the petitioner files a statutory appeal within such time, the appellate authority is at liberty to proceed to pass a final order on merits without further reference to limitation. Subject to the Petitioner complying with the above stipulations, the attachment of the bank account of the Petitioner shall also stand automatically vacated.

It is made clear that bank attachment shall be lifted subject to the petitioner depositing 25% of the disputed tax as ordered above and the Petitioner not being in arrears of any other amount for any other tax period barring the amount demanded under the impugned Order.

In case the Petitioner fails to comply with any of the stipulations, the Respondent is at liberty to proceed against the Petitioner to recover the tax in accordance with law as if this Writ Petition was dismissed in limine today.

Writ Petition stands disposed of.

Amendment of registration certificate - cancellation of GST registration - restoration of registration - corporate insolvency resolution process - effect of change of management on tax registration - judicial review of administrative action - HELD THAT:- The case of the petitioner is that the 1st respondent, is continuing to treat the petitioner as if it is the old management that is running the petitioner company and is not willing to permit the petitioner to operate.

A perusal of the impugned proceedings, issued by the 1strespondent, reinforces such a view. It appears that the 1st respondent is still acting on the premise that the old management is in place and is operating the company. This view does not stand scrutiny inasmuch as the new management has been put in place by the National Company Law Tribunal in a properly constituted corporate insolvency resolution process.

Thus, it would only be appropriate that the proceedings of the 1st respondent are set aside and a fresh opportunity is given to the petitioner to seek amendment of the registration certificate issued in favour of the petitioner earlier.

Accordingly, the Writ Petition is allowed and the proceedings of the 1st respondent, dated 13.11.2025 and 14.11.2025,rejecting the amendment of the registration certificate and cancelling the registration certificate are set aside and the 1st respondent shall consider the application of the petitioner, dated 03.11.2025, regarding objections given by the petitioner regarding the amendment of the registration certificate and pass orders, within a period of three weeks, from the date of receipt of this order.

Profiteering u/s 171 - benefit of Input Tax Credit passed to recipients by way of commensurate reduction in price - re-investigation under Rule 133(4) of the CGST Rules, 2017 - time-bar / limitation contentions under Sections 73 and 74 - HELD THAT:- It is to be noted that the Respondent had participated in the investigation process, therefore, this fact that a benefit of Rs. 173/- has been passed to the Complainant and the other Villa buyers need to be verified on the basis of examining the relevant documents to be produced by the Respondent. The matter requires further investigation by the DGAP on the basis of the data supplied by the Respondent in his Written Statement.

Respondent vehemently argued that the entire proceedings are manifestly time-barred. The transaction occurred in 2017-2019, but the complaint and investigation commenced in 2024-2025.

In its Written Statement, the Respondent submitted applicable time limit under Section 73 and 74 during the financial year 2017-2018, 2018-2019 and it is shown to be lapsed on the part of the DGAP.

The matter requires further investigation in view of the Written Submission and the data demonstrated through different tables in it. Further this fact is to be examined extensively as to whether against the profiteered amount Rs 32.78 per sq ft. The amount of Rs. 173/- alleged to have been passed by the Respondent can be termed as the benefit of Input Tax Credit to the complainant and other home buyers by way of commensurate reduction in prices. The matter is sent back to the DGAP for re-investigation under Section 133 of the CGST Rules, 2017 to examine as to whether the Respondent has already passed the benefit of ITC to the Respondent commensurately to the reduction of rate of tax.

The matter is sent back to the DGAP for further investigation under Rule 133(4).

Reopening of assessment v/s assessment u/s 153C - Applicability of Sections 153C and 148 in case of seizure of material in search or requisition of books-documents relating to assessee other than on whom the search was conducted or requisitioned made - delay of 560 days in filing the Special Leave Petition

HC decided [2024 (4) TMI 196 - RAJASTHAN HIGH COURT] language of explanation 2 to new Section 148 is akin to Section 153A and Section 153C. Corollary being that after seizing of operational period of Section 153A to 153D, the cases being dealt thereunder were circumscribed in the scope of newly substituted Section 148.

Department has not set up a case that for initiating proceedings under Section 148 it had material other than the material seized during the search of Manihar Group. The contention was that though the material with regard to unaccounted loan advanced by the petitioner was received, the earning of interest on unaccounted loan was derivation of the AO from the material received. The submission is that the derived conclusion cannot be acted upon under Section 153C. The submission lacks merit and shall defeat the concept of single assessment order for each of relevant preceding years for assessing ‘total income’ in case of incriminating material found during search or requisition.

HELD THAT:- Delay which has not been satisfactorily explained by the petitioners.

Even otherwise, we find no good reason to interfere with the impugned order passed by the High Court. Special Leave Petition is, therefore, dismissed on the ground of delay as well as merits.

Penalty u/s 271D - violation of the provisions of Sec. 269SS - mandation of recording any satisfaction in the assessment order - exercise of jurisdiction by Joint Commissioner - gross delay of 350 days in filing the Special Leave Petition - HC [2024 (10) TMI 1768 - ANDHRA PRADESH HIGH COURT] held that satisfaction of the AO is required to be recorded because the same officer, who passed the assessment order would not be levying the penalty u/s 271D of the Act.

Unless the AO who is the primary authority, based on the material before it, during assessment proceedings, arrives at a finding that there has been a violation of the provisions, like in the present case, of Section 269SS, there will not be any occasion to the Joint Commissioner, who is not the Assessing Officer, to exercise his jurisdiction to levy Penalty u/s 271D.

HELD THAT:- Delay has not been satisfactorily explained by the petitioners.

Even otherwise, we find no good reason to interfere with the impugned order passed by the High Court. The Special Leave Petition is, therefore, dismissed on the ground of delay as well as merits.

Withdrawal of exemption granted u/s 10(23C) - seeking for being notified under Section 10(46) - assessees to seek for being notified under a different provision - petitioners are constituted by the State Governments under Section 4 of Water (Prevention and Control of Pollution) Act, 1974 and Section 5 of the Air (Prevention and Control of Pollution) Act, 1981 and are established for the purpose of administering and controlling various steps relating to reduction of pollution and hazardous waste of all kinds, as per the statutory provisions of the said statutes.

As decided by HC [2021 (7) TMI 1264 - TELANGANA HIGH COURT] the reason assigned by the 2nd respondent in its communication dt.02.03.2021 to reject the request of the petitioners seeking withdrawal of the approval granted u/s 10(23C) of the Act, is also overlooking the power conferred on the said authority under Section 293C of the Act, even if it is construed that the 15th proviso confers power on the authority to withdraw only on the conditions stipulated therein. The understanding of the 2nd respondent that the power to withdraw conferred u/s 293C or Section 10(23C)(iv) of the Act, to be undertaken only at the behest of the respondents and not at the request of the petitioners, does not appeal to this Court, as a correct understanding.

Writ petitions are allowed; the 2nd respondent is directed to withdraw the approval granted to the petitioners under Section 10(23C) of the Act with effect from the date of applications made by the petitioners for being notified under Section 10(46).

HELD THAT:- We have perused the material on record including the impugned order(s).

We do not find any reason to interfere with the impugned order(s). Special Leave Petitions are dismissed.

Validity of Faceless assessment u/s 144B - notices issued by the JAO and not FAO - HELD THAT:- We dispose of these Special Leave Petition(s) by permitting the petitioner(s) herein to file an application(s) before the High Court(s) in the disposed of matter(s) to bring to the notice of the High Court(s) the latest clarification which has been issued with effect from 01.04.2021 on such clarification to be inserted in the proposed Finance Act.

If such an application(s) is made by the petitioner herein before the High Court, the same shall be considered after giving an opportunity of hearing to both sides on its merits.

In the event, the petitioner or any other party is unsuccessful, then liberty is reserved to the aggrieved party(s) to approach this Court to assail the impugned order(s) as well as the subsequent order(s) to be passed.

Special Leave Petitions are disposed of in the aforesaid terms.

Reopening of assessment - Notice issued by the Jurisdictional Assessing Officer (JAO) instead of a Faceless Assessing Officer (FAO) - non-compliance with the faceless scheme mandated by Section 151A - gross delay of 306 days in filing the Special Leave Petition.

HELD THAT:- On perusal of the application seeking condonation of delay, we find that the reasons stated are neither satisfactory nor sufficient in law so as to condone the delay.

Hence, the application seeking condonation of delay is dismissed. Special Leave Petition is dismissed.

Review petition - Demands for income tax that were raised after the date of approval of the Resolution Plan - binding nature of an approved Resolution Plan on statutory dues - Condonation of delay - delay of 208 days

HELD THAT:- Despite the fact that there is a delay of 208 days in filing the Review Petition for which no satisfactory explanation has been furnished, we have gone through the same on merits. In our opinion, no case for review of the judgment [2025 (3) TMI 1052 - SUPREME COURT]is made out wherein held Resolution Plan approved on 21st May 2019 is binding on the first respondent. Therefore, the subsequent demand raised by the first respondent for the assessment years 2012-13 and 2013-14 is invalid.

Review Petition is, accordingly, dismissed on the ground of delay as well as on merits.

Order revisable u/s 264 - declaration of the Return of Income of the Petitioner as invalid - HELD THAT:- 1st Respondent has completely misdirected himself when he held that declaring the Petitioner’s Return as invalid [by the CPC] is not an order as contemplated under Section 264. In fact, the 1st Respondent referred to the definition of the word ‘order’ to be a mandate, precept, command or authoritative direction.

Despite noting the aforesaid definition (in the dictionary), the 1st Respondent went on to hold that the so-called communication addressed by the CPC to the Petitioner was not an order as contemplated under Section 264. We are clearly of the view that a declaration given u/s 139(9) of the IT Act is clearly an order which is revisable u/s 264. It is certainly a mandate, or at the very least, an authoritative direction.

What is interesting to note is that in the case of TPL-HGIEPL Joint Venture Vs. Union of India [2025 (3) TMI 1441 - BOMBAY HIGH COURT] it was the case of the Revenue itself that any declaration given under Section 139(9) of the IT Act was certainly revisable under Section 264. In fact, this submission of the Revenue was accepted by this Court and the Writ Petition filed by the Petitioner therein was not entertained, relegating the said Petitioner to invoke the remedy under Section 264.

We are clearly of the view that the order passed by the 1st Respondent is unsustainable in law and has to be quashed and set aside. It is accordingly so ordered. Revision Application filed by the Petitioner is now restored to the file of the 1st Respondent for a de novo consideration.

Reopening of assessment u/s 147 - reasons to believe - burden to prove - basic contention that while issuing notice, the AO had not provided relevant information to the petitioner - HELD THAT:- A perusal of sub-section (1) of Section 148A of the Act of 1961 (as it stood before the amendment vide Finance Act, 2021) reveals that it simply provides for information suggesting income chargeable to tax has escaped assessment is to be supplied along with the notice.

Information according to this Court means a concise narration or detail about the conclusion or inference, which the AO has drawn from the material available with him. Such views of ours is fortified, if we look at the provision contained in sub-section (3) of Section 148A of the Act of 1961, where the legislation has used the expression “on the basis of material available on record”.

On a careful reading of sub-section (3) of Section 148 of the Act of 1961, it is apparent that the framers of law have carved out a clear distinction between the material available on record and the information to be supplied. Supply of information does not necessarily mean that copies of the entire material available on record have to be supplied to the petitioner or assessee along with notice under Section 148A(1) or 148A(b), as the case may be.

If the argument of the petitioner as advanced is accepted and it is held that every material has to be supplied to the assessee along with the notice under Section 148A(1) or Section 148A(b) (as applicable from time to time), it will result in protraction of the proceeding and giving assessee unwarranted opportunity to defend the transactions, which he had withheld while filing the return of income by way of getting the relevant material or defence manufactured.

Needless to observe that the burden is always on the AO to prove that the assessee has indulged into some transactions out of books, by way of cogent evidence and material.

No Jurisdictional error in the impugned notice and the proceedings undertaken by the respondent. The petition is, therefore, dismissed.

Reopening of assessment u/s 147 - Period of limitation - scope of period prescribed under the Taxation and Other Laws (Relaxation and Amendment of certain Provisions) Act, 2020 - HELD THAT:- As far as the delay is concerned, we note that the Petitioner has explained the same in her Writ Petition.

We may also observe that since the Department has unequivocally conceded the issue in question before the Hon’ble Supreme Court in Rajeev Bansal [2024 (10) TMI 264 - SUPREME COURT (LB)] we do not deem it appropriate to deny relief to the Petitioner solely on the ground of delay. Any delay on the part of the Petitioner would not validate a notice which is otherwise declared to be invalid in the eyes of law, more so when the Department has initiated recovery proceedings based upon such notice.

We thus find merit in the submissions canvassed on behalf of the Petitioner that the impugned Notice under Section 148 of the IT Act and all consequential Orders/Notices for A.Y.2015-16, are bad in law. Accordingly, the impugned Notice dated 14th April 2022 issued under Section 148 of the IT Act (Exhibit ‘D’), the Assessment Order (Exhibit ‘H’), and all consequential orders/notices including recovery notices thereof are hereby quashed and set aside.

In light of the above, Petitioner, on instructions, undertakes to withdraw the Appeal filed by the Petitioner before the Commissioner of Income Tax (Appeals), within a period of 2 weeks from the date of uploading this Order.

Appreciation of evidence - finding of fact - interference by appellate court in factual findings - genuineness of loan transactions - creditworthiness of lenders - payment through banking channel as evidence - paper transaction / entry provider - short-term repayment and absence of interest

Appreciation of evidence - finding of fact - interference by appellate court in factual findings - Whether the High Court should interfere with the Tribunal's factual finding allowing the assessee's appeal. - HELD THAT: - The Court held that the question canvassed before it was essentially one of factual appreciation and evaluation of evidence which the Tribunal had undertaken. The Tribunal had recorded findings on enquiries made, documentary material furnished by the creditors and banking transactions. Absent any error of law or perversity in the Tribunal's conclusion, the appellate forum should not disturb concurrent findings of fact. The Court therefore declined to reappraise the evidence afresh and found no warrant for interference with the Tribunal's conclusion allowing the assessee's appeal. [Paras 5, 8]

No interference with the Tribunal's factual finding; appeal dismissed.

Genuineness of loan transactions - creditworthiness of lenders - payment through banking channel as evidence - short-term repayment and absence of interest - paper transaction / entry provider - Whether the loans taken by the assessee were to be treated as sham transactions and liable to be treated as unexplained cash credit / additions. - HELD THAT: - The Tribunal found identity and creditworthiness of the creditors established by confirmations, ITR acknowledgements, audited financial statements and bank statements, and relied on payments effected by account-payee cheques and repayment through banking channels to uphold genuineness. The Revenue urged that rapid repayment (one loan repaid within two days) and an investigation report alleging an entry-provider militated against genuineness. The Court observed, however, that rapid repayment or absence of interest is not conclusive of a sham loan since short-term advances may legitimately be interest-free or carry negligible interest due to personal or business relations. The Court also noted that certain enquiries (for example regarding licence under the Bengal Money Lenders Act or the nature of relationship between parties) were not pursued, and that lack of such enquiry militated against a successful interference. On the material before the Tribunal the Court found no basis to hold the loans as paper transactions. [Paras 6, 7]

The loans were not held to be conclusively sham on the record before the Tribunal; the addition deleted by the Tribunal was not interfered with.

Final Conclusion: The appeal is dismissed; the High Court declines to disturb the Tribunal's factual findings that established the identity and creditworthiness of the lenders and the genuineness of the loan transactions on the material before it, while noting that certain enquiries which might have been relevant were not undertaken.

Penalty u/s 271D -penalty proceedings pending quantum appeal - HELD THAT:- As challenge to the quantum proceedings is pending before the ITAT. This was specifically brought to the notice of the Income Tax Department in the penalty proceedings initiated by it. Despite this, the impugned penalty order came to be passed on 9th December 2025.

We are clearly of the view that as per the law laid down by this Court in the cases of R.B. Shreeram Durgaprasad [2015 (12) TMI 569 - BOMBAY HIGH COURT], Kellogg India Private Limited [2022 (5) TMI 1700 - BOMBAY HIGH COURT] and Maharashtra State Electricity Transmission Company Limited [2025 (12) TMI 1358 - BOMBAY HIGH COURT] no penalty order could have been passed while the challenge to the Assessment Order itself was pending before the ITAT.

The penalty proceedings ought to have been kept in abeyance till the decision was rendered in the quantum proceedings. WP allowed.

TP Adjustment - Assessee raised an additional ground that the Associated Enterprises are least complex entity and should be allowed as tested party - ITAT considering the submission of the Assessee, restored the issue raised in the additional ground to the file of AO / TPO for examining the issue afresh after considering all the material available on record and by calling the information and documents from the Assessee as well as by making own inquiry in the data base or otherwise. HELD THAT:- Having gone through the well reasoned order, we are satisfied that the present Appeal does not involve any substantial question of law. It is further pointed out that pursuant to the remand made by the Tribunal to the Assessing Officer, a fresh order has been passed by the AO. As Assessee submits that the order passed by the AO pursuant to the remand has been challenged before the competent forum by filing appropriate proceedings. In such view of the matter, the Appeal is dismissed.

Condonation of delay filling appeal before ITAT - delay of 202 days - cause of the effect of COVID-19 and the subsequent situation that prevailed post COVID-19 more particularly the business of the appellant coming to a standstill, they could not pursue the appeal promptly

HELD THAT:- Period during which the appeal was probably filed was immediately post Covid-19 period and during which time, there infact was certain difficulties which was being faced by every commercial establishment and the appellant herein is not exception to the same. Another fact which cannot be lost sight of is that here again is the case as contended by the appellant that the order of the Commissioner of Income Tax (Appeals) which the appellant intended to challenge before the Tribunal also was one which was decided without hearing the appellant on merits rather was decided only on the basis of pleadings before the Commissioner of Income Tax (Appeals) and at this juncture if the appellant’s appeal before the ITAT is not restored, appellant would be rendered remediless in challenging the finding arrived at by the Commissioner of Income Tax (Appeals).

In the opinion of this Bench, therefore upon imposition of certain penalty/cost upon the appellant, the delay in filing of the appeal before the ITAT can be condoned and the ITAT can be further directed to decide the appeal on its own merits and in accordance to law.

We are inclined to allow the instant appeal to the extent of setting aside the order of learned ITAT [2025 (8) TMI 1773 - ITAT HYDERABAD]. So far as rejection of the appeal on the ground of condonation of delay, however, the appellant is imposed with the cost of Rs. 15,000/- to be paid within a period of 15 days to the Telangana State Legal Services Authority.

Adhoc disallowance at 10% of the expenses - assessee submitted that though the assessee had furnished supporting evidences to justify the claim of expenses, without pointing out any deficiency in them, the A.O. has selectively disallowed certain expenses purely on adhoc basis without any valid reasons - CIT(A) deleted addition - HELD THAT:- On a reading of the assessment order, we have not noticed any adverse observation of the A.O. regarding the deficiency in supporting evidences furnished by the assessee qua the expenses. Merely because in respect of some items of expenditure there is increase in quantum in the impugned assessment year, that by itself cannot be a reason to disallow a part of such expenses, that too, on purely adhoc basis without establishing on record that such expenses were non genuine or have not been incurred for the purpose of business. No reason to interfere with the decision of ld. First appellate authority in deleting the disallowance. Ground no.1 is dismissed.

Corresponding expenditure related to income offered in the impugned assessment year - interest expenditure accrued to the assessee - HELD THAT:- So far as the factual position relating to the issue in dispute is concerned, there is no dispute that the interest amount was received by the assessee in the impugned assessment year by virtue of an order of Hon'ble High Court. Thus, the interest expenditure accrued to the assessee in the impugned assessment year. It is also a fact on record that the assessee had to pay an amount to M/s. B.Vijaykumar & Co. who had advance the loan. The A.O. has not disputed the fact of payment made to M/s. B.Vijaykumar & Co. Thus, when the assessee has offered the income in the impugned assessment year, the corresponding expenditure related to such income has to be allowed. Decided in favour of assessee.

Validity of reopening of assessment - reasons to believe - low Net profit rate - additions on account of estimation of net profit by applying 2% of the turnover as against the declared N.P. @ 0.28% by the assessee - HELD THAT:- Assessee showing low Net profit rate cannot be considered as valid reasons for escapement of income and reopening the assessment under the provisions of section 147. We are of the view that there is stark absence of live nexus between the tangible material available on record and reasons recorded to take a view that the assessee is showing low net profit.

We find that the CIT(A) had confirmed the addition on the basis of Net Profit @ 2.75% on account of the fact that the same was upheld by the CIT(A) in AY 2014-15. It now transpires that the ITAT for AY 2014-15 [2024 (10) TMI 1674 - ITAT DELHI] had deleted the addition on net profit and accepted the net profit shown by the assessee.

Thus, reasons recorded for reopening the assessment are not valid and sustainable in law. Decided in favour of assessee.

Condonation of delay - Dismissal for delay - Interference with High Court order - Special Leave Petition dismissed on merits

Condonation of delay - Dismissal for delay - Whether the Special Leave Petition could be entertained despite a delay of 203 days in filing. - HELD THAT: - The Court recorded that there was a gross delay of 203 days in filing the Special Leave Petition and that the petitioners had not provided a satisfactory explanation for that delay. On that basis the Court held that the petition could not be entertained and dismissed the Special Leave Petition on the ground of delay. [Paras 1, 3]

Petition dismissed on the ground of delay.

Interference with High Court order - Special Leave Petition dismissed on merits - Whether the Court should interfere with the impugned order passed by the High Court. - HELD THAT: - Independently of the delay, the Court stated that there was no good reason to interfere with the impugned High Court order and dismissed the Special Leave Petition on merits as well. The dismissal therefore rests both on the unexplained delay and on the absence of merit for interference with the High Court's decision. [Paras 2, 3]

No interference with the High Court order; petition dismissed on merits.

Final Conclusion: Special Leave Petition dismissed both for unexplained delay of 203 days and on merits; pending applications, if any, disposed of.

Penalty u/s 112(b)(i) - admissibility of statements recorded u/s 108 - procedure u/s 138B - confiscation and smuggled goods - HELD THAT:-Penalties upon the appellants under section 112(b)(i) of the Customs Act has been imposed in view of the statements made by Gourav Jain and the appellants under section 108 of the Customs Act. In the appeal filed by Gourav Jain, it has been held that such statements cannot be considered as relevant as the procedure contemplated under section 138B of the Customs Act was not followed. The gold bars have not been found to be smuggled as documents were produced, though later. For the reasons stated in Customs Appeal, the imposition of penalties upon the appellants cannot be sustained and is set aside.

The two appeals are, accordingly, allowed.

Rejection of transaction value under Rule 12 of the Customs Valuation (Determination of Value of Imported Goods) Rules, 2007 - Redetermination of assessable value and imposition of AntiDumping Duty on differential amount - Customs valuation based on transaction value and GATT Article VII principle - Admissibility of electronic evidence and statements recorded under Section 108 in light of Sections 138B/138C of the Customs Act

Rejection of transaction value under Rule 12 of the Customs Valuation (Determination of Value of Imported Goods) Rules, 2007 - Redetermination of assessable value and imposition of AntiDumping Duty on differential amount - Customs valuation based on transaction value and GATT Article VII principle - Whether the Commissioner was justified in rejecting the declared transaction value and redetermining a lower assessable value so as to impose AntiDumping Duty and related penalties - HELD THAT: - The Tribunal held that Rule 12 permits the proper officer to raise doubts about the truth or accuracy of the declared value only on specific grounds (for example, significantly higher values for identical or similar goods, abnormal discounts, misdeclaration of description/quality/quantity etc.) and does not provide a method enabling the officer to reduce a legitimately higher transaction value to a lower notional value for the sole purpose of levying AntiDumping Duty. The record showed the declared transaction value was higher than the Department's suggested benchmark and customs duties (including CVD and SAD) had been accepted by the Department at that value. The investigation did not produce cogent corroborative evidence-apart from disputed statements-to establish that the higher transaction value was artificially inflated to evade ADD. Reliance on ICIS weekly bulletin prices alone to substitute for transaction value was found impermissible, and treating a periodical's price range as the transaction value conflicted with the valuation regime rooted in the transactionvalue principle under GATT Article VII. For these reasons the confirmation of reassessment, ADD, redemption fines and penalties was held unsustainable and liable to be set aside. [Paras 8, 9, 10]

Order confirming rejection of declared value, redetermination of a lower value and consequent imposition of AntiDumping Duty, interest, redemption fine and penalties set aside.

Admissibility of electronic evidence and statements recorded under Section 108 in light of Sections 138B/138C of the Customs Act - Whether the electronic records and statements recorded under Section 108 constituted sufficient, admissible evidence to prove overvaluation and thereby justify the Department's action - HELD THAT: - The Tribunal examined the Department's reliance on allegedly retrieved electronic documents and statements. It noted procedural deficiencies in seizure and forensic examination (nonfurnishing of seized correspondence, lack of opportunity for crossexamination of forensic witnesses, and contention that seized electronic material was editable and not traced to its origin). Statements under Section 108 were retracted and were not separately tendered before the Adjudicating Authority with opportunity for crossexamination. In that factual matrix, the Tribunal found that the Section 108 statements, being retracted and untested before the Authority, together with the disputed electronic material, did not furnish cogent evidence to establish overvaluation for the purpose of evading ADD. Consequently, the material relied upon by the Commissioner was insufficient to sustain confirmation of duty and penalties. [Paras 3, 7, 9]

Electronic records and retracted Section 108 statements were not held to be admissible or sufficient to prove overvaluation; reliance on them was inadequate to sustain the impugned order.

Final Conclusion: The Tribunal allowed the appeals, set aside the Commissioner's OrderinOriginal confirming reduction of assessable value, levy of AntiDumping Duty, redemption fine, interest and penalties, and granted consequential relief, holding that the Department failed to justify rejection of the declared transaction value or to produce cogent admissible evidence to support imposition of ADD and penalties.

Admissibility of electronic records -seized/reconstructed DVD -Compliance with Section 138C of the Customs Act, 1962 and Section 65B of the Evidence Act - Reliability of reconstructed electronic evidence - Evidentiary value of retracted statements recorded under investigation - Penalty for use of false and incorrect material u/s 114AA - Maintainability of appeals u/s 129A -

Whether, the electronic record in the form of the so-called DVD in the instant case can be admissible as evidence for imposition of penalty under Section 114AA of the Customs Act, 1962 on the appellant in this case, without verifying its genuineness, veracity or reliability from the original electronic device by/from which these are created, or not. - HELD THAT:- It is well settled that the source and authenticity of electronic records, such as the said DVD in this case, are required to be ensured, in order to be used as evidence. Since electronic records are more susceptible to tampering, alteration, transposition, excision, etc., without such safeguards, an order based on unproved or unverified electronic records like DVDs can lead to travesty of justice. Admittedly, in the present case, the evidence, i.e., the so-called DVD, was never there in existence to support the case of the respondents and not available from the beginning of its recovery for appellant to refute, in spite of his request. We also take note of submission that the Hard Disk of the said computer utilised for creation of the said DVD, taken possession of by the DRI officers, was not placed before original authority before finalization of the adjudication orders. In fact, the appellant has pointed out that the said DVD was admittedly found to be broken inside a sealed cover, under DRI custody.

It is a fact on record that no certificate under Section 138C of the Customs Act, 1962 read with Section 65B of the Indian Evidence Act, 1872 has been procured by DRI while seizing the DVD or documents derived from such DVD. The originals of the export documents, which were actually utilized in the export proceedings and for passing through Customs authorities of Kolkata Port are not in the possession of DRI. Under such circumstances, computer printouts taken from the so-called DVD recovered during the search cannot be relied upon as evidence to impose penalty on him, in the absence of a certificate as prescribed under Section 138C of the Customs Act, 1962.

The Hon’ble Supreme Court in the case of M/s. Jeen Bhavani International Versus Commissioner of Customs, Nhava Sheva-III [2022 (8) TMI 237 - CESTAT MUMBAI].

Therefore, by applying the ratio laid down in the decisions cited supra, we are also of the view that the information available in the said DVD cannot be relied upon as admissible evidence against the appellant in the impugned proceedings in the absence of compliance of the provisions of Section 138C ibid.

Thus, we hold the electronic record, in the form of the so-called DVD in the present case, cannot be treated as admissible evidence, in the absence of any verification as to its genuineness, veracity or reliability from the original electronic device by/from which these are created, for the purpose of imposition of penalty under Section 114AA of the Customs Act, 1962 on the appellant. The said issue is therefore answered in favour of the appellant.

Whether, the statement(s) recorded under the stress of investigation from Shri Jyoti Biswas, co-accused, which was retracted before the Court of the Ld. CMM by serving the copy to Respondents on the same day in Court on 22.09.2016, can be relied upon to implicate the appellant in this case, or not. - HELD THAT:- Since the statement of Shri Jyoti Biswas has been retracted, we agree with the contention of the appellant that the same cannot be relied upon as evidence for implicating the appellant in the alleged offence, in the absence of any corroborative evidence.

Hence, we find that relevancy of the above retracted statement of Shri Jyoti Biswas has not been proved by Revenue. Consequently, in the absence of any concrete evidence being adduced by the Revenue, we hold that the statement recorded from Shri Jyoti Biswas, which has been retracted before a court of law, cannot be relied upon in the instant proceedings against the appellant. Accordingly, the Issue No. (2), as framed under paragraph 11 of this Order, stands answered in favour of the appellant.

Applicability of the relevant statutory provisions invoked - There is also nothing on record to show that the appellant was in any manner concerned with the export of goods. Since the above ingredients, which are essential for imposing penalty under Section 114AA of the Act, are absent in the case, we do not find any justification for imposition of penalty under Section 114AA of the Customs Act on the appellant.

It is also relevant to note that in the earlier Show Cause Notices issued to the various exporters in the course of investigation, the name of the appellant was not mentioned. In fact, as pointed out by the appellant, the appellant was brought in these proceedings only at a later stage, although he was neither posted / holding any supervisory post of Customs at the relevant point of time where the exporters exported their goods, nor was any nexus found to establish his involvement in the alleged fraudulent exports by means of independent and concrete evidence. Therefore, even on this count, we agree with the submission of the appellant that under such circumstances, the provisions of Section 114AA of the Act cannot be invoked against the appellant.

Thus, we hold that the penalties imposed on the appellant under Section 114AA of the Customs Act, 1962, as upheld vide the impugned orders, are not sustainable. Consequently, the said penalties imposed on the appellant are set aside.

Undervaluation of the networking equipment imported -artificially splitting the transaction value into hardware and software -Inclusion of value of embedded or integral software in transaction value of hardware - interpretative classification and valuation - extended period of limitation u/s 28, invoked for fraud, suppression, wilful misstatement - penalty u/s 114A and confiscation u/s 111(m) - remand for re-quantificati on of demand for the normal period of limitation -HELD THAT:- A similar issue had come up before this Tribunal in the case of Commissioner of Customs (Airport), Custom House, Chennai v. M/s. ITI Ltd. [2025 (5) TMI 1935 - CESTAT CHENNAI]

Taking note of the above ratio in the case of M/s. ITI Limited case (supra) which takes note of various judgements on the same, following the same, we hold that the value of the software is includable in the value of the hardware imported and as such the confirmation of duty in this regard is upheld. It is also seen in the ITI Ltd. (supra) decision, that it has been held that there is a thin line of distinction and that the error was bonafide.

Even in the present case, it is not alleged that the appellants have supressed the import of the software. Merely due to their understanding, have chosen to dissect the value of hardware from that of the software. Therefore, we are of the view that no suppression with an intent to evade payment of duty can be alleged in the facts and circumstances of the present case.

In our view, the issue herein is interpretative in nature therefore there is no misstatement or suppression of facts but rather it was the bonafide belief of the Assessee that the classification and valuation of the software done separate from the hardware by them is correct; thereby extended period of limitation cannot be invoked.

In this context during the dispute period, the normal period of limitation under Section 28 of the Customs Act, 1962 only can be raised, which was 1 year. Therefore, the Bill of entry and invoices considered are ranging from the period of July 2006 April 2010 whereas, the SCN is dated 03.02.2011. Therefore, other than for the period from February, 2010 to April, 2010, the demand has been raised beyond the statutory limitation and accordingly barred by limitation.

Imposition of penalty - In the case of Easland Combines, Coimbatore v. Collector of Central Excise [2003 (1) TMI 107 - SUPREME COURT], the Hon'ble Supreme Court had observed that for the invocation of the extended period of limitation, duty should not have been paid because of fraud, collusion, wilful misstatement, suppression of fact or contravention of any provision.

Further holding that the said ingredients postulate a positive act and therefore the mere failure to pay duty which is not due to fraud, collusion or wilful misstatement or suppression of facts is not sufficient to attract the extended period of limitation. Accordingly, penalty is set-aside. The demand for normal period is upheld and to be re-quantified for the normal period of limitation.

Validity of transferable duty credit scrips and licences issued by licensing authority - duty credit/exemption against such scrips/licenses - bonafide transferee entitlement to duty exemption where scrips were valid at time of import - void ab initio versus voidable character of licences/scrips obtained by fraud - forged or non-issued scrips having no legal existence - confiscation and penalty - Whether, the goods imported by the appellants, as the Bonafide transferee under freely transferable Duty Credit Scrips/Licenses, which were valid and subsisting on the date of import, would be liable for denial of the benefit of duty exemption in lieu of such scrips, or otherwise, on the ground that the ‘original license holder’ had fraudulently obtained the same? -HELD THAT:- In the case in hand, the appellants had purchased the scrips/licenses from the persons, who were recognized by the licensing authorities as the exporter of the goods and upon subjective verification, the same were issued in their favour by the competent authorities. Thus, under such circumstances, even if the said documents were obtained by the main beneficiary by adopting to the fraudulent means or practices, it cannot be questioned at the stage of the ultimate beneficiary, who had purchased such document duly issued by the competent authority and utilized the same for duty free importation of goods.

We find that the issue arising out of the present dispute is no more res integra, in view of the order passed by the Co-ordinate Bench of the Tribunal in the case of Apar Industries Limited Vs. Commissioner of Customs (Export Promotion), Mumbai [2025 (5) TMI 2183 - CESTAT MUMBAI] Upon analysis of the factual matrix involved in the said case, vis-à-vis the legal position.

Thus, we do not find any merits in the impugned orders, insofar as the adjudged demands were confirmed against the appellants. Therefore, the impugned orders are set aside and the appeals are allowed in favour of the appellants.

General Rules of Interpretation (GRI) - Rule 1 - General Rules of Interpretation (GRI) - Rule 2(a) (incomplete/unassembled goods and essential character) - General Rules of Interpretation (GRI) - Rule 3 (most specific description prevails) - Section XVII Notes - Note 2 and Note 3 (exclusions and suitability for use solely or principally) - classification of parts under Heading 8708 versus specific headings for components - classification of motor vehicles under Heading 8703 - applicability of Notification No. 45/2025-Cus. (Entry No. 318) for knocked down / kit imports - essential character test for classifying incomplete or disassembled imports

General Rules of Interpretation (GRI) - Rule 2(a) (incomplete/unassembled goods and essential character) - classification of parts under Heading 8708 versus specific headings for components - Section XVII Notes - Note 2 and Note 3 (exclusions and suitability for use solely or principally) - Whether the Authority would rule on classification of the individual products listed in Annexure-I - HELD THAT: - The applicant clarified during hearing and in additional submissions that it did not seek an advance ruling on the classification of each individual item listed in AnnexureI (2,870 products). The Authority accepted that classification of those individual products is to be determined by application of the General Rules of Interpretation, the Tariff and relevant Section and Chapter Notes, and noted the Commissionerate's position that classification of each item cannot be decided without componentspecific information. Consequently the Authority refrained from issuing any ruling on the tariff classification of the individual products in AnnexureI and indicated that such classification can be determined in terms of GRI, Tariff and Section/Chapter Notes by the field formation or in separate proceedings. [Paras 5, 6]

Refrained from issuing any ruling on classification of the products detailed in AnnexureI; classification to be determined in terms of GRI, Tariff and relevant Section and Chapter Notes.

Applicability of Notification No. 45/2025-Cus. (Entry No. 318) for knocked down / kit imports - essential character test for classifying incomplete or disassembled imports - classification of motor vehicles under Heading 8703 - Whether the individual products proposed to be imported, being disjointed and disassembled and intended for use in manufacture of electric vehicles, are eligible for the 15% duty rate under Entry No. 318 of Notification No. 45/2025Cus. - HELD THAT: - Entry No. 318 of Notification No. 45/2025Cus. confines the concessional rates to imports classifiable under Heading 8703 and to imports presented as a knocked down kit containing the necessary components/subassemblies for assembly of a complete vehicle. The concessional 15% rate under subitem (i)(a) requires that the kit be classifiable under 8703 and that the specified components be unconnected and not mounted on a chassis. Applying GRI 2(a) and the established essentialcharacter jurisprudence, the Authority found that the applicant's imports are standalone components imported at different points in time, not presented as a CKD/SKD kit or as a substantially complete disassembled vehicle, and do not, individually or collectively as presented on import, possess the essential character of a motor vehicle under 8703. Critical body parts are imported unwelded and unpainted and extensive manufacturing is required before a finished vehicle emerges. Therefore the conditions of Entry No. 318 are not satisfied and the imported items are not eligible for the notification benefit at 15%. The Authority also recorded that, without prejudice, if the imports were treated as covered by the Entry, they would at best fall under subitem (i)(a) (15%) given they are unmounted and unconnected. [Paras 5, 6]

The conditions of Entry No. 318 of Notification No. 45/2025Cus. are not fulfilled on the facts presented; the individual products are not eligible for the 15% concessional rate under that Entry.

Final Conclusion: The Authority admitted the application, declined to rule on classification of the 2,870 individual items (classification to be determined under GRI, Tariff and relevant Section/Chapter Notes), and independently examined Notification No. 45/2025Cus. (Entry No. 318), holding that the applicant's imports-being standalone components imported at different times and not presented as a knocked down kit or possessing the essential character of a vehicle on import-do not satisfy the conditions of Entry No. 318 and are therefore not eligible for the 15% concessional rate.

Classification of goods - imported "Brass rods" - Condition of the article at the time of import (as imported) - General Rules for Interpretation (GRI) 1 and 6 - Classification of alloys by predominant metal - Definition of bars and rods (Section XV Note 9)-Eligibility for Advance Ruling under Chapter VB (Importer with IEC) - HELD THAT:- It is a settled legal principle that a product's classification is determined by its form and condition when presented for customs clearance. Classification is therefore based solely on the technical specifications of the product in its "as imported" state. The applicant has referred to decision of the Hon'ble Supreme Court in the case of Dunlop India Ltd. [1975 (10) TMI 94 - SUPREME COURT]

In the case of Weaves [1996 (2) TMI 143 - SUPREME COURT] and Vizag Shipping and Metal Processors [2005 (7) TMI 413 - CESTAT, BANGALORE], the court has affirmed that a product's "as imported" condition is the sole basis for imposing countervailing duty. Consequently, any modifications or activities performed after importation have no bearing on its legal classification or duty liability

Thus, the subject goods-brass rods-must be classified based on their condition at the time of import, regardless of their eventual conversion into finished products like valves.

Whether the "Brass Rods" merit classification under CTH 7407 2120 or any other CTH. - HELD THAT:- It is evident that Chapter 74 covers "Copper and articles thereof". The product under Consideration is 'Brass Rods'. The subject goods under consideration being an alloy of copper, zinc and lead where copper is predominant by weight as per the Material Data Safety Sheet, merit classification under Chapter 74 by virtue of application of GRI 1 and the relevant Section Notes to Section XV.

As per the Material Safety Data Sheet provided by the applicant, Copper is the predominant constituent by weight and Zinc clearly predominates over other elements (Lead, Tin, Nickel, Iron, Aluminium). Also, Nickel by weight is < 0.3% and Tin by weight is < 0.3%. Thus, the subject product meets all conditions for classification as Copper-Zinc base alloy (brass) under Chapter 74 and Customs Tariff Sub-Heading 7407 21 as "Of copper-zinc base alloys (brass)" under the First Schedule of the Customs Tariff Act.

The subject goods merit classification under Heading 7407 21 in terms of Rule 1 of the General Rules for Interpretation. The subject goods are alloy of copper, zinc and lead where copper is predominant by weight and Zinc predominates other elements. Further, weight of nickel is also less than 5% and tin less than 3%.

Section Note 9 to Section XV specifically deals with the classification of the goods falling under the Chapter 74 to 76 and 78 to 81, by providing certain definitions to aid the classification of goods falling under the Chapter 74 to 76 and 78 to 81. Similarly, HSN Explanatory Note to Customs Tariff Heading 7407 makes reference to the Bars and rods. Bars and rods are defined in Note 9 (a) to Section XV. The subject goods being manufactured in conformity with the definition of "bars and rods" are thus classifiable under CTH 7407 21 20.

Thus, the Commissionerate has also agreed upon that the 'Brass Rods' merit classification under CTH 7407 21 20.

Thus, Brass Rods are classifiable under CTH 7407 21 20 of the First Schedule to the Customs Tariff Act, 1975.

Classification of goods - imported products described as PS moulding, PS wall panel, PS L profile, PS wall panel sheet, PVC panel foam, PVC sheet UV, PVC panel, PVC vinyl sheet, PVC panel WPC mould, PVC wall panel and PU wall panel - classifiable under Heading 3921 (other plates, sheets, film, foil and strip, of plastics) Or under Heading 3925 (builders' ware of plastics, not elsewhere specified or included) - General Rules for the Interpretation (GIR) - essential character test - in-line extrusion/profiled edges not amounting to further working - HELD THAT:- It is settled principle of law that the classification of any good under Customs Tariff Act, 1975 is governed by the General Rules for the Interpretation of the Import Tariff. Further, Rule 1 of GRI stipulates that "classification shall be determined according to the terms of the headings and any relative Section or Chapter Notes." It is only when the headings and notes do not require otherwise then one may proceed to the subsequent rules.

After due examination of Tariff heading and chapter notes, the principal contention of the applicant is that the goods, notwithstanding certain surface finishing such as UV coating, printing or embossing, retain their essential character as plates or sheets of plastics of regular rectangular shape. The applicant has stressed that in terms of Chapter Note 10 to Chapter 39 and submitted that such plates or sheets remain classifiable under heading 3921, even if, when so cut, they become articles ready for use. The applicant has therefore asserted that classification under heading 3925, which covers builders' ware of plastics, is not appropriate for their products.

Based on the information on record, there are in fact two categories of products are listed in this application. The first category comprises plain PVC sheets, supplied in large rectangular form with or without surface printing undoubtedly having character as plastic sheets in terms of Chapter Note 10. The another category, which comprises mouldings, wall panels and goods with interlocking tongue-and-groove edges, designed to be fitted continuously to create a wall or ceiling surface. These products in view of the department exhibit characteristics of builders' ware/structural elements/architectural features and their classification require to be examined in further detail.

The Commissionerate concern relates particularly to the above second category. Their argument is that once a sheet is profiled in such a manner as to interlock and form part of the building structure, its essential character changes from a mere sheet to a constructional article.

The panels are not integrated into the structural framework of the building but are applied as a decorative overlay on existing finished walls. The wall structure exists independently and functions identically whether these panels are present or absent. This is fundamentally different from true structural elements like drywall, which forms the actual wall surface, or partition systems, which create the spatial divisions. The mere fact that a product is used on walls does not make it a "structural element used in walls." The category contemplates products that are integral to the wall structure itself, not decorative overlays applied to finished walls. I find these PVC panels remain essentially decorative sheets designed for aesthetic wall covering as a substitute of paint & wall papers, temporarily in nature and easily removable, lacking structural function, architectural complexity, or permanent integration into building frameworks. The correct classification under CTH 3921 reflects both the goods' essential character as plastic sheets and their commercial understanding as decorative wall coverings. In view of above, no force in the department's argument.

Thus, find that the products retain the essential form of plates/sheets of plastics within the meaning of Note 10 to Chapter 39. The longitudinal interlocking/tongue-and-groove at the edges is an in-line extrusion profile and, on these facts, does not amount to "further working" of the type exemplified in the Chapter and explanatory notes (e.g., drilling, milling, framing, twisting, cutting into non-rectangular shapes). The HSN EN to 3921 explicitly embraces cellular and reinforced/laminated/supported sheet products that remain plates/sheets and are not covered by 3918/3919/3920 or Chapter 54. The subject panels fit that description.

Therefore, hold that the following goods mentioned in application are classifiable under heading 3921 of the Customs Tariff; goods of polymers of styrene in the sheet/panel form fall under 39211100; goods of polymers of vinyl chloride in the sheet/panel form fall under 39211200; goods of polyurethanes in the sheet/panel form fall under 39211390; and other plastics or sheets retaining the character of plates/sheets fall under 39219029, subject to verification of the actual composition, structure (cellular/non-cellular; reinforced/laminated/supported) by the field formation in this regard.

I, rule accordingly.

Mediation - mediator's report taken on record - settlement agreement - consent terms - exercise of jurisdiction under Article 142 of the Constitution - treatment of settlement as decree/enforceable order - parties added as respondents by consent - registry directed to draw decree - disposal of appeal by consent - HELD THAT:- The original Settlement Agreement dated 24-12-2025 duly signed by the “Transcon Skycity Private Limited and Anchor Point Developers Private Limited” respectively be taken on record and shall be kept with the records of this case.

The parties are directed to abide by the terms of Settlement without fail.

With the aforesaid, the Civil Appeal stands disposed of.

Gross amount charged - valuation u/s 67 - nexus between amount charged and the taxable service - service tax on TDS paid on behalf of the assessee - TDS not includible in taxable value where paid over and above contract value -Whether Revenue Authorities were correct in demanding service tax on the amount paid as TDS on behalf of the appellant is justified or otherwise. - HELD THAT:- The TDS being paid by NHAI to the Government is as per the provisions of the Income Tax Act, 1961. Tax Deducted at Source (TDS) is a way of collection of income tax under the provision of Chapter XVII of the Income Tax Act. Section 198 provides that all the sums deducted in accordance with provisions of the chapter shall for the purpose of computing the income of the assessee, be deemed to be the income received.

Therefore, service tax is payable on the entire contract value between the service provider and the service recipient. In the present case, NHAI has paid income tax, over and above the agreed contract value. The appellant has paid service tax on the invoices.

Thus, the deductions by the NHAI do not form part of the consideration. Therefore, the appellant’s contention that such amount cannot be added for the purpose of service tax is correct.

Thus, we find that the facts are quite different from the earlier decision of this Bench. In the present case, TDS/deductions are not part of the agreed contractual value and therefore, not liable to service tax.

Therefore, appeal is liable to be allowed and is accordingly, allowed.

Valuation of taxable service - Reverse charge mechanism - Gross amount charged - Nexus between consideration and taxable service - Reimbursable expenses - Rule 5 ultra vires - Whether the value of expenses incurred by the respondent towards the services / facilities provided to the service provider’s specialists are includable in the taxable value of the Consulting Engineer service received by the respondent from the Foreign Service provider {M/s Rosoboron export, Moscow) for the purpose of payment Service Tax under reverse charge mechanism or otherwise - HELD THAT:- Larger Bench in the case of M/s Bhayana Builders Pvt Ltd., & Others. [2013 (9) TMI 294 - CESTAT NEW DELHI-LB], held that the value of goods and materials supplied free of cost by a service recipient to the provider of the taxable construction service, being neither monetary or non-monetary consideration paid by or flowing from the service recipient, accruing to the benefit of service provider, would be outside the taxable value or the gross amount charged, within the meaning of the later expression in Section 67 of the Finance Act, 1994.

The reliance placed by the Department on the case of M/s Harveen & Company, [2011 (5) TMI 140 - CESTAT, NEW DELHI], and M/s Aggarwal Colour Advance Photo System, [2011 (8) TMI 291 - CESTAT, NEW DELHI (LB)] are based on different facts, therefore, distinguishable and distinguished.

Thus, the issue is no longer res-integra and therefore, no need to interfere in the impugned order.

Appeal dismissed.

Retreading of tyres taxable as maintenance and repair service (interpretative question) - penalty u/s 78 of the Finance Act, 1994 (quasicriminal nature of penalty) - proviso to section 73(1) - extended period invocation and wilful suppression/intent to evade - bonafide belief / absence of wilful misstatement or suppression as defence to extended limitation and penalty - HELD THAT:- In this case, we find that in the finding portion of the Order-in-Original dated 28.10.2013, the Adjudicating Authority has only imposed penalty under Section 77 of the Finance Act, 1994 but in the order portion have imposed penalty under Section 78 which in our view is clearly unsustainable as it is settled position of law that the imposition of penalty is quasi criminal in nature and an improper finding or no finding would render the very imposition of penalty as bad in law. There was no discussion as to invocation of extended period and imposability of penalty under Section 78 of the Finance Act, 1994.

For all these reasons, and since the appellant had paid the tax along with the interest and they are pleading only for non-imposition of penalty, in the facts and circumstances of the present case, we are of the view that the imposition of penalty under section 78 is not maintainable and so ordered to be set aside. As far as the imposition of penalty under Section 77 of the Finance Act, 1994 for a sum of Rs.3000/, the same was already set aside by the Appellate Authority.

Thus, the appeal is partly allowed to the extent of setting aside the penalty imposed under Section 78 of the Finance Act, 1994.

Revenue-sharing arrangement on principal-to-principal basis - business support services (BSS) - infrastructural support services - healthcare services exempt from service tax - finality of departmental orders and prohibition on taking contrary stand - Circular No. 109/03/2009-ST (principal-to-principal transactions not treated as service) - HELD THAT:-We find that the issue involved in the present appeal, relating to revenue sharing arrangements between the Appellant and the DSPs, is no longer res integra as the Tribunal as well as the departmental Appellate Authority, for the earlier and the subsequent periods, have decided the issue in favour the Appellant vide the Orders as cited in table (in para 4 above) by holding that revenue sharing arrangements are not subject to service tax under the BSS.

Further, we note that the department has not filed any appeal against the above-mentioned Orders, therefore, the said Orders have attained finality and therefore, the department cannot take contrary view on the same issue for the same assessee as held in the case of CCE, Pune-II vs. S S Engineers [2023 (7) TMI 717 - SC ORDER]. Further, we find that this Tribunal in the case of OP Jindal Institute of Cancer & Research [2024 (10) TMI 824 - CESTAT CHANDIGARH], has considered the identical issue along with the agreements entered into by the Appellant with the DSPs and has held that revenue sharing arrangements between the Appellant and the DSPs are not subject to service tax.

Since, the issue is covered by the decision of this Tribunal in the above cited case, therefore, by following the ratio of above cited decision, we are of the considered view that the impugned order is not sustainable in law and is liable to be set aside and we do so by allowing the appeal of the Appellant with consequential relief, if any, as per law.

Short paid Service Tax - incorrect inclusion of exempted/ non-taxable turnover -Determinationthe taxable value in accordance with Section 67 of the Finance Act 1994 - demand raised on the basis of the data received from the Income Tax Department - reliance on Income Tax records/Form 26AS without corroborative evidence - invocation of extended period of limitation where facts are within departmental knowledge or derived from statutory records - Principles of natural justice​​​​​​​ - refund of amounts collected without authority of law - no interest or penalty u/s 78 when foundational demand is unsustainable - penalty u/s 77 for non-filing of returns - Excess amount of Service Tax paid.

Demand based merely on Form 26AS - without corroborative evidence - HELD THAT:- It is settled law that Income Tax records by themselves cannot be the sole basis for confirmation of Service Tax demand, unless supported by corroborative evidence. We note that this view has been taken by the CESTAT at Kolkata in the case of M/s. Rishu Enterprise v. Commissioner of C.G.S.T. & C.Ex., Dibrugarh [2024 (2) TMI 566 - CESTAT KOLKATA] wherein it has been categorically held that a demand based merely on Form 26AS is unsustainable.

Thus, we hold that the demand confirmed in the impugned order solely on the basis of the data received from the Income Tax Department, without having any independent corroborative evidence, is legally not sustainable.

Determination of taxable value under Section 67 - HELD THAT:- demand in the impugned order has been confirmed without examining the applicability of the said exemption and abatement as claimed by the appellant. - the impugned order has not determined the taxable value in accordance with Section 67 of the Finance Act, 1994.

It is a well settled principle of law that determination of taxable value is a sine qua non for confirming any demand, and in the absence thereof, the demand confirmed is rendered unsustainable in law. It is settled law that any demand of Service Tax must be clearly quantified on a transaction-wise and invoice-wise basis, disclosing the precise methodology adopted for arriving at the alleged short payment.

A careful examination of the Show Cause Notice and the impugned order reveals that the demand has been raised without disclosing any clear methodology, computation sheet, or correlation with invoices or transactions.

It is a settled position of law that a vague and unsubstantiated demand violates principles of natural justice. The Hon’ble Supreme Court in Commissioner of C.Ex., Nagpur v. Ballarpur Industries Ltd [2007 (8) TMI 10 - SUPREME COURT] held that demands raised without proper calculation and supporting evidence are not sustainable. Therefore, we are of the considered view that the demand raised and confirmed without determining the taxable value is not sustainable. Accordingly, demand of Rs.20,39,712/- confirmed over and above the self-assessed service tax amounting to Rs.58,56,266/- paid by the appellant during the relevant period, is not sustainable and hence we set aside the same.

Invocation of extended period of limitation - HELD THAT:- When the entire basis of the demand is drawn from declared and audited Income Tax data, there can be no allegation of suppression, wilful mis-statement or intent to evade tax. It is also pertinent to note that it is a settled position of law that extended period of limitation cannot be invoked where the facts are within the knowledge of the Department or derived from statutory records.

Accordingly, the invocation of the extended period under Section 73(4) of the Finance Act, 1994 in this case is wholly unjustified and unsustainable. From the records, we find that the impugned Show Cause Notice for the period October 2016 to March 2017 has been issued on 20.01.2021, by invoking extended period of limitation. We observe that the normal period of limitation during the relevant period was 18 months. Thus, we find that the entire demand confirmed in this case has been barred by limitation as the Notice has been issued beyond the normal period of limitation. Consequently, we hold that the demand confirmed in the impugned order is liable to be set aside on the ground of limitation also.

As the demand confirmed against the appellant itself is not sustainable, the question of demanding interest or imposing penalty under Section 78 of the Finance Act, 1994, does not arise. Hence, we set aside the demand of interest and penalty imposed under Section 78 of the Finance Act, 1994.

Imposition of penalty under section 77 of the Finance Act, 1994 - HELD THAT:- We find that even though the appellant had discharged their self-assessed Service Tax liability, they have not filed the returns for the period April 2016 to June 2017. Accordingly, we uphold the penalty imposed under Section 77 of the Finance act, 1994, for non-filing of returns for the relevant period.

Excess amount of Service Tax paid - HELD THAT:- The demand of Service Tax of Rs.20,39,712/-confirmed in the impugned order is unsustainable on merits as well as on limitation. In this context, we note that it is a settled principle of law that amounts collected without authority of law must be refunded. Thus, the appellant is eligible for the refund of the amount of Rs.20,39,712/- deposited by them 'under protest' during the course of investigation. However, in this regard, we observe that for claiming the refund, the appellant must follow the procedure prescribed in accordance with law.

The appeal filed by the appellant is disposed of on the terms.

Cenvat credit on inputs used in fabrication of capital goods - inputs used as supporting structures vs inputs for capital goods - eligibility of input service credit - effect of amendments in Cenvat Credit Rules post 07.07.2009 - remand for recomputation and verification based on documentary evidence - HELD THAT:- We have perused the impugned order, whereby, Adjudicating Authority has gone through the eligibility or otherwise in respect of various inputs and input services. We find that she has decided the whole issue based on various judgements as well as factual matrix, as also the CA’s certificate certifying the uses of those items in connection with either for fabrication of capital goods or for support structure. Therefore, based on the factual matrix as also various case laws relied by her, she has dis-allowed the credit on MS items, allowed input credit in respect of certain services while dis-allowed in respect of other services.

We have also perused the order dated 30.01.2014, wherein, the issue was eligibility of certain MS items like MS pipes, plates etc., used for fabrication of chutes, bins, ducts, cyclones, vents, hoppers, stacks. It also involved eligibility of credit in respect of various input services and she has examined all the input services and allowed the same, except in respect of insurance, banking and financial services and rent-a-cab and pest control. She has also held that credit availed on such quantity of MS plates and MS steels used in fabrication of the equipment/machinery are regular, whereas, denied the credit in respect of steel items used for manufacturing supporting structure by holding that the same cannot be treated as inputs for capital goods or as inputs in relation to the final products. Therefore, we find that the issues involved in the present appeal have now attained finality in terms of the said order passed by the Adjudicating Authority and as further upheld with certain modification and observation by the Tribunal vide it’s order dated 22.01.2016.

Therefore, in appeal, the matter is remanded back for re-computation of demand, with directions, supra, and impugned order is set aside. Appeal is allowed by way of remand.

Admissibility of Cenvat Credit of Service Tax taken by the appellant under the category of input services used for making civil structures like boundary wall, civil and structural work, helipad etc., which are immovable property as also certain corrections in duty paying documents.

These issues are also remanded back to the Adjudicating Authority for re-determination, in view of the discussions and decisions referred supra. Accordingly, Department appeal is also allowed by way of remand.

Exemption from excise duty - supply as fuel to foreign going aircraft - warehousing without payment of duty - proviso excluding Aviation Turbine Fuel from application of Rule 19 - interpretation of notification - strict versus purposive construction of exemption notifications - liability for duty on removal to warehouse - penalty and interest under the Central Excise Act - scope of show cause notice / travelling beyond notice - HELD THAT:- It needs to be noted that a Notification No. 47/2001 dated 26.06.2001 was issued under sub-rule (1) of rule 20 of the Central Excise Rules, 2001 which is identical to rule 20 of the 2002 Rules. The Central Government extended the facility of removal of all excisable goods specified from the factory of production to a warehouse, or from one warehouse to another warehouse without payment of duty.

In the instant case, it is seen that the Notification No. 08/2022 dated 30.06.2022 does not mention that ATF should be directly supplied from the place of manufacture to the foreign going aircraft and it cannot be supplied through the warehouses of the appellant. The only requirement contained in Notification No. 08/2022 is that the fuel must be “supplied as fuel to foreign going aircraft”. The Notification does not mention that exemption will be granted to ATF supplied from the place of manufacture “only” when it is supplied from the place of manufacture to the foreign going aircraft.

It has, therefore, to be held that the appellant would be entitled to the benefit of the Notification No. 08/2022.

The Principal Commissioner has also held that Notification No. 47/2001 dated 26.06.2001 was superseded by Notification No. 17/2004 dated 04.09.2004 w.e.f. 06.09.2004 and so the facility of removal of ATF without payment of duty from the factory of production to a warehouse or one warehouse to another warehouse was withdrawn.

In the first instant, the show cause notice issued to the appellant does not refer to this aspect and, therefore, the Principal Commissioner travelled beyond the show cause notice to record this finding. In any view of the matter, the appellant has been held to be entitled to exemption from payment of excise duty on removal of ATF from the factory to the warehouse for supply to ATF to foreign going aircrafts in terms of Notification No. 08/2022 dated 30.06.2022.

The impugned order dated 27.11.2024 passed by the Principal Commissioner for recovery of excise duty from the appellant with interest and penalty cannot, therefore, be sustained and is set aside. The appeal is, accordingly, allowed.

Invocation of extended period of limitation under the proviso to Section 11A - willful suppression, fraud, collusion or wilful misstatement - MRP-based valuation u/s 4A - transaction value u/s 4 - disclosure in ER-1 returns and departmental knowledge - bona fide interpretation of law not attracting extended period -

Whether non-adoption of MRP-based valuation under Section 4A by the respondent constitutes willful suppression so as to justify invocation of the extended period of limitation under Section 11A? - HELD THAT:-In Schneider Electric India Pvt. Ltd. [2024 (2) TMI 727 - CESTAT CHENNAI] and Birla Corporation Ltd. [2023 (3) TMI 1067 - CESTAT NEW DELHI] squarely apply. These decisions hold that when material particulars are disclosed in ER-1 returns and the Department does not object for a prolonged period, extended limitation cannot be invoked merely because the valuation method was later found to be incorrect during audit. It is further held that ER-1 returns do not mandate disclosure of the valuation methodology and that departmental failure of scrutiny cannot be shifted onto the assessee.

In the present case, no material has been brought on record to establish deliberate concealment or mens rea on the part of the respondent. The issue came to light only during the audit, and upon being pointed out, the respondent immediately accepted the liability and paid duty with interest for the normal period.

Accordingly, we hold that the non-adoption of valuation under Section 4A by the respondent does not constitute wilful suppression, and invocation of the extended period of limitation under Section 11A is not sustainable.

Whether the adjudicating authority was correct in dropping the demand of ₹1,18,40,175/- pertaining to the extended period? - HELD THAT:- Having held that the extended period under Section 11A is not invocable, the natural corollary is that the demand raised beyond the normal period of limitation cannot be sustained. The adjudicating authority, after detailed examination of records, correspondence, and conduct of the respondent, came to the categorical finding that there was no suppression with an intent to evade duty, and accordingly confined the demand to the normal period from March 2014 to September 2014.

We find that this conclusion is fully supported by the evidence on record and is in consonance with settled legal principles. The respondent had disclosed the classification, turnover, and nature of clearances; the returns were duly filed and scrutinised; and the Department itself had engaged with the respondent on SSI-related issues without raising any valuation objection. In such circumstances, it would be legally impermissible to sustain a demand for the extended period merely because the audit subsequently took a different view on valuation.

Therefore, the dropping of the demand of ₹1,18,40,175/- relating to the extended period is legal, proper, and justified, and calls for no interference.

Whether the Department’s appeal merits interference with the impugned order? - HELD THAT:- In the absence of any fresh material or compelling legal error pointed out by the Department, the appeal essentially seeks a re-appreciation of facts already examined and correctly decided. As such, we hold that the Department’s appeal does not merit any consideration, and the impugned order dropping the extended period demand and confirming duty only for the normal period deserves to be upheld.

Thus, we hold that the non-adoption of MRP-based valuation under Section 4A by the respondent arose from a bona fide interpretation of law and not from any wilful suppression or intent to evade payment of duty. The Department has failed to establish the existence of fraud, collusion, wilful misstatement, or suppression of facts so as to justify invocation of the extended period of limitation under the proviso to Section 11A of the Central Excise Act, 1944.

We find no legal infirmity or perversity in the impugned Order-in-Original warranting interference by this Tribunal.

As such, we hold that the Department’s appeal is not maintainable and is so rejected and the Order-in-Original No. 01/2016-CE dated 06.01.2016 is upheld.

SSI exemption - Cashew Shell Liquid (CNSL) - corrigendum as part of notification - interpretation aided by TRU clarification - rate notification cannot override exemption - interest and penalty consequential on duty demand - Whether Cashew Shell Liquid (CNSL) falling under Chapter Heading 1302 19 20 was eligible for SSI exemption under Notification No. 8/2003-CE as amended by Notification No. 8/2006-CE during 2012-13? - HELD THAT:- On a plain and harmonious reading of Notification No. 8/2003-CE as amended by Notification No. 8/2006-CE read with the Corrigendum dated 28.02.2006, CNSL clearly remains eligible for SSI exemption. The Department’s contention proceeds on a truncated and incomplete reading of the Annexure by ignoring the corrigendum, which is legally impermissible.

Read conjointly, the principal notification, the corrigendum, and the TRU clarification unmistakably establish that there was no conscious policy decision to deny SSI exemption to Cashew Shell Liquid, and the Department’s reliance on an uncorrected or truncated version of the Annexure is therefore legally unsustainable.

The ratio laid down in Shah Foods Ltd. [2012 (9) TMI 676 - CESTAT, AHMEDABAD], squarely applies to the present case, as the corrigendum relied upon herein is identical in nature and scope. We also note that the Appellant has cited its own case and other precedents during the course of hearing, wherein consistent views have been taken that once a corrigendum clarifies the scope of an exemption notification, the Department cannot selectively rely upon an uncorrected or truncated version of the Annexure to deny statutory benefits.

It is well settled that a rate notification cannot nullify or negate an exemption notification unless such intention is explicitly stated. In the absence of any express provision withdrawing SSI exemption for CNSL, the benefit available under Notification No. 8/2003-CE continues to operate independently.

Once it is held that the Appellant was legally entitled to SSI exemption during the relevant period, the very foundation of the demand collapses. Consequently, the demand of duty confirmed in the impugned order is unsustainable in law. It follows as a natural corollary that interest under Section 11AA of the Central Excise Act, 1944, being purely consequential and compensatory in nature, cannot survive when the principal demand itself fails. Similarly, the penalty imposed under Rule 25 of the Central Excise Rules, 2002 is also liable to be set aside, as penalty cannot be sustained in the absence of a legally valid duty demand.

Thus, Cashew Shell Liquid (CNSL) falling under Chapter Heading 1302 19 20 is eligible for SSI exemption under Notification No. 8/2003-CE as amended by Notification No. 8/2006-CE, read with Corrigendum dated 28.02.2006;

The impugned Order-in-Appeal dated 30.01.2014 is hereby set aside.

Accordingly, the appeal is allowed.

Remand for implementation of tribunal order - entitlement to self-credit / Cenvat credit under High Court order - manufacture of Oral Preparations, Cosmetics, Hair Care & Skin Care Preparations, falling under Chapters 33 & 27 -special rate fixation based on actual value addition - finality of tribunal order in absence of stay - res judicata arising from High Court decision - HELD THAT:- Appellant submits that infact the appellant filed various application in view of the Notifications 17/2008 CE dated 27.03.2008 and Notification No. 31/2008 C.E. dated 10.06.2008 for special fixation of rates which were pending before this Tribunal and this Tribunal vide Final Order No. 76746 -76760/2023 dated 22.09.2023 allowed their appeals and directed the Adjudicated Authority to implement special rates as prayed by the appellant in their applications.

In view of that it would be in the interest of justice to direct the Adjudicating Authority first to implement our order dated 22nd September, 2023 and thereafter to adjudicate the impugned Show Cause Notices issued to the appellant. In view of this, we set aside the impugned orders and remand matter back to the Adjudicating Authority to implement our order dated 22nd September, 2023 within 60 days from today and thereafter to adjudicate the impugned Show Cause Notices within one month thereof. With these terms appeal is disposed of by way of remand.

Entitlement to take Cenvat Credit - HELD THAT:- We hold that in terms of the order of Hon’ble Guwahati High Court wherein the demand raised by denying self credit to the appellant was set aside by the Hon’ble Guwahati High Court. Therefore, the said issue is no more res-integra. Therefore, appellant is entitled to take self-credit in terms of the order of the Hon’ble High Court of Guwahati.

Thus, the impugned orders are set aside and remanded to the Adjudicating Authority to pass the fresh order.

Sale for export - goods sent outside India and consideration received in foreign exchange - amounts to a sale in the course of export, as defined in Section 5 of the CST Act Or Not - exemption from tax - words “in the course of export” - exemption from State sales tax under Article 286(1)(b) - transfer of documents of title after the goods have crossed the customs frontiers - Scope of Section 5(1) of the Central Sales Tax Act - HELD THAT:- The 2nd respondent appears to have understood the words “in the course of export” to mean that the sale of goods carried out by the petitioner would not meet the requirement in Section 5(1), on the basis of the dictum laid down by the Hon’ble Supreme Court in the case of Ben Gorm Nilgiri Plantations Co. v. Sales Tax Officer [1964 (4) TMI 90 - SUPREME COURT] In this case, a manufacturer of processed tea, had sold it’s tea, by way of public auction, to an agent or an intermediary of foreign buyers.

The issue that came up for consideration, before the Hon’ble Supreme Court, was whether such sales would come within the ambit of sales described in Section 5(1) of the CST Act, held that; " Each case must depend upon its facts. But that is not to say that the distinction between transactions which may be called sales for export and sales in the course of export is not real. In general where the sale is effected by the seller, and he is not connected with the export which actually takes place, it is a sale for export. Where the export is the result of sale, the export being inextricably linked up with the sale so that the bond cannot be dissociated without a breach of the obligation arising by statute, contract or mutual understanding between the parties arising from the nature of the transaction, the sale is in the course of export"

In the present case, the 2nd respondent holds that the goods moved out of India, as a result of the sales to the foreign buyers and that the petitioner received the sale consideration, in foreign currency. It is not clear as to whether the 2nd respondent has deliberately misunderstood these provisions or he genuinely did not understand the meaning of the term “in the course of export” in Section 5(1) of the CST Act. It is unfortunate that an officer who has been in the department and was holding the post of an Additional Commissioner of Commercial Taxes could come up with an order of this nature.

In any event, this was an unnecessary burden cast on this Court, to correct a palpably illegal order. In the circumstances, this Writ Petition is allowed, setting aside the impugned Order of revision.