TaxTMI Updates e-Newsletter
Feb 13,2018

Interstate supply and applicability of IGST - intra-state applicability of State GST - inspection, search and seizure under Central GST - E-Way bill requirement and temporal applicability - prima facie illegality of seizure where requisite central rule/notification was not in force - release of perishable goods on furnishing indemnity bond and security

Interstate supply and applicability of IGST - intra-state applicability of State GST - Applicability of U.P. GST provisions to goods in transit from outside the State. - HELD THAT: - The Court noted that transactions in respect of goods in transit from outside the State fall within the scope of the Integrated Goods and Services Tax (IGST) and that the provisions of the U.P. GST Act and its rules are confined to transactions within the State. Consequently, the statutory scheme applicable to interstate movement is governed by Central/IGST provisions rather than the State Act. The petitioner's contention that U.P. GST provisions would not apply to interstate consignments was accepted on this legal premise.

U.P. GST provisions are not applicable to goods in transit from outside the State; IGST/Central GST regime applies.

Inspection, search and seizure under Central GST - E-Way bill requirement and temporal applicability - prima facie illegality of seizure where requisite central rule/notification was not in force - Validity of the seizure dated 20.01.2018 in the absence of an applicable E-Way bill requirement under Central GST on that date. - HELD THAT: - The Court observed that Rule 138 of the Central GST Rules contemplates a transitional specification of documents until the E-Way bill system is implemented, and the central notification making E-Way bill mandatory was enforced with effect from 1 February 2018. Since on the date of seizure (20.01.2018) the Central GST regime did not mandate an E-Way bill, the seizure-if treated as under Section 129(1) of Central GST read with Section 6 of IGST-appears to be prima facie illegal for lack of an applicable E-Way bill requirement under the Central enactment. The Court accepted that a clerical or incorrect reference to a State provision in the seizure order does not necessarily invalidate it, but found illegality on the present facts due to absence of a central E-Way obligation at the relevant time.

Seizure prima facie illegal because the Central GST E-Way bill requirement was not in force on the date of seizure.

Release of perishable goods on furnishing indemnity bond and security - Whether the seized perishable goods should be released pending adjudication. - HELD THAT: - Having found prima facie illegality in the seizure and noting the perishable nature of the goods, the Court directed interim relief. The release was made conditional: the petitioner must furnish an indemnity bond and security (excluding cash and bank guarantee) in respect of the proposed tax and penalty calculated on the value shown in the accompanying documents. This measure balances protection of the State's revenue with preservation of perishable goods.

Seized perishable goods to be released with vehicle on petitioner furnishing indemnity bond and non-cash security for proposed tax and penalty.

Final Conclusion: The Court held that interstate consignments fall under the IGST/Central GST regime (not U.P. GST), found the seizure prima facie illegal because the Central E-Way bill requirement was not in force on 20.01.2018, allowed release of the perishable goods subject to indemnity bond and non-cash security, and permitted the State to file a counter-affidavit before further listing.

Maintainability of writ petition in presence of alternative remedy of appeal - Availability of efficacious alternative remedy of appeal - Exercise of jurisdiction under Article 226 of the Constitution - recognised exceptions - Reopening of assessment and reassessment proceedings initiated under borrowed satisfaction - Reassessment following notice under Section 148 - factual enquiry versus pure question of law

Maintainability of writ petition in presence of alternative remedy of appeal - Availability of efficacious alternative remedy of appeal - Exercise of jurisdiction under Article 226 of the Constitution - recognised exceptions - Reassessment following notice under Section 148 - factual enquiry versus pure question of law - Writ petitions challenging reopening and assessment orders are not maintainable where an efficacious alternative remedy of appeal exists and the controversy involves factual issues requiring in-depth consideration. - HELD THAT: - The Court considered the preliminary objection that the petitioners have an effective alternative remedy by way of appeal against the assessment orders. The petitioners had participated in assessment proceedings and approached the Court only after the assessment orders were passed. The Court observed that the disputes raised are not pure questions of law but require detailed factual examination (including the allocation of shares, dates and comparative fair market values and competing contentions of partners and the firm) which are matters for the appellate forum. The petitioners failed to demonstrate that the appellate remedy is not efficacious or that their case falls within the well-defined exceptions permitting exercise of extraordinary writ jurisdiction under Article 226. In these circumstances the Court sustained the Revenue's preliminary objection and held that the remedy by appeal must be availed of instead of entertaining the writ petitions. [Paras 6, 7, 8, 9, 10]

Writ petitions dismissed as not maintainable; petitioners left free to pursue the statutory appellate remedy.

Final Conclusion: The High Court dismissed the writ petitions for lack of maintainability because the petitioners have an effective alternative remedy of appeal and the disputes raised involve factual questions better suited for adjudication in the appellate process; petitioners may avail the appellate remedy.

Reopening of assessment - reason to believe - reasons recorded by Assessing Officer - reopening invalid where reasons palpably incorrect - contrived losses - misutilisation of exchange platform - bound by recorded reasons

Reopening of assessment - reason to believe - reasons recorded by Assessing Officer - bound by recorded reasons - Validity of notices issued to reopen assessment for AY 2011-12 on the basis of the reasons recorded by the Assessing Officer. - HELD THAT: - The Assessing Officer recorded reasons alleging that the assessee had booked contrived losses of Rs. 16,51,096 by misutilisation of the NMCE platform through a broker, and that such losses were set off against other income, giving rise to a 'reason to believe' that income had escaped assessment. The assessee on objection produced the balance-sheet and stated that the said amount appears on the credit side as sale proceeds (i.e., receipt/profit) and not as a claimed loss. The Court examined the reasons recorded and the material on record and held that there is nothing to show that the assessee had claimed the alleged loss; on the contrary the balance-sheet showed receipt. The revenue is therefore bound by the reasons recorded and cannot expand or alter the basis for reopening beyond those reasons. Where the reasons themselves are palpably incorrect as to primary facts relied upon for forming belief of escapement of income, the reopening cannot be sustained. Applying these principles to the material before it, the Court concluded that the reasons for reopening were factually incorrect and hence did not furnish a valid 'reason to believe' to reopen assessment for the stated amount. [Paras 5, 6, 7]

Impugned notices of reopening issued to reopen assessment for AY 2011-12 were set aside as the reasons recorded were palpably incorrect and did not sustain a valid reason to believe that income had escaped assessment.

Final Conclusion: Petitions allowed; impugned notices of reopening set aside for the reasons recorded being palpably incorrect and insufficient to sustain reopening of assessment for AY 2011-12.

Reopening of assessment - annulment of reopening - reasons recorded by Assessing Officer - statement of director as basis for reopening - absence of material to justify reopening - under-assessment due to alleged unaccounted sales

Reopening of assessment - reasons recorded by Assessing Officer - statement of director as basis for reopening - absence of material to justify reopening - Validity of the Assessing Officer's action in reopening the scrutiny assessment for A.Y. 2005-06. - HELD THAT: - The Tribunal's conclusion that the notice of reopening was not backed by valid reasons is affirmed. The reasons recorded relied on an investigation by DGCEI and on a statement of the assessee's director to infer that sales to M/s H.K. Impex Pvt. Ltd. were bogus and therefore resulted in unaccounted sales. Examination of the director's statement shows only that goods sent to H.K. Impex's premises were thereafter, at the recipient's instructions, diverted to other locations without disclosure to Excise authorities. That fact may suggest diversion or possible excise/sales tax implications, but it does not negate that a sale from the assessee to H.K. Impex took place nor does it, by itself, establish the non-existence of the claimed sales. The Assessing Officer's reasons therefore did not demonstrate material contradicting the recorded sale sufficient to form a valid belief for reopening the completed scrutiny assessment.

Reopening of the assessment for A.Y. 2005-06 was invalid and the Tribunal rightly annulled the reopening.

Final Conclusion: The Tax Appeals dismissing the Tribunal's annulment of the reopening are dismissed; the Tribunal's order annulling the reopening of assessment for A.Y. 2005-06 is upheld.

Reopening under Section 147/148 for escapement of income - Reason to believe - Reopening after acceptance of return without scrutiny and change of opinion - Fishing and roving inquiry - Verification of transactions not a ground for reopening

Reopening under Section 147/148 for escapement of income - Reason to believe - Fishing and roving inquiry - Verification of transactions not a ground for reopening - Validity of the notice dated 27.03.2017 reopening assessment for A.Y. 2010-11 - HELD THAT: - The Court found that the Assessing Officer's recorded reasons amounted only to a need to verify a sale transaction of Rs. 40,00,000 and did not disclose any concrete material forming a reason to believe that income had escaped assessment. The court reiterated that even where a return has been accepted under section 143(1) and no earlier scrutiny assessment was framed, the power to reopen cannot be exercised for a mere verification of transactions or to embark on a fishing or roving inquiry. Reliance was placed on the decision in Inductotherm (India) P. Ltd. v. M. Gopalan where it was held that reopening cannot be justified solely to verify claims and that the Assessing Officer must record reasons that show more than an intention to examine or verify transactions. Applying that principle, the Court concluded that the reasons recorded in the impugned notice were inadequate and impermissibly sought to convert reopening into a scrutiny-like verification. [Paras 5, 6, 7]

Impugned notice dated 27.03.2017 is quashed; reopening held invalid.

Final Conclusion: The petition is allowed; the notice of reopening dated 27.03.2017 for A.Y. 2010-11 is set aside as being founded on impermissible verification and not on a valid reason to believe that income had escaped assessment.

Recording of satisfaction note under Section 158BD - Immediacy requirement for recording satisfaction - Validity of notice under Section 158BD - Delay vitiating block assessment proceedings - Application of Calcutta Knitwears precedent

Recording of satisfaction note under Section 158BD - Immediacy requirement for recording satisfaction - Validity of notice under Section 158BD - Application of Calcutta Knitwears precedent - Whether the notice issued under Section 158BD was invalid because the assessing officer recorded satisfaction with undue delay - HELD THAT: - The Court applied the ratio of the Supreme Court in Calcutta Knitwears that a satisfaction note is a sine qua non for initiation of proceedings under Section 158BD and may be recorded at or along with initiation, during the assessment under Section 158BC, or immediately after completion of those proceedings. The Court held that although the law permits recording satisfaction after completion of the searched person's assessment, that recording must be done immediately thereafter. Where no limiting factor prevented earlier action, a period close to nine months between completion of proceedings in respect of the searched person and recording of satisfaction cannot be treated as 'immediately'. The Court endorsed the reasoning in Commissioner of Income-Tax v. Bharat Bhushan Jain that delays of the order of ten months to one-and-a-half years are not contemporaneous and constitute undue delay, thereby rendering notices issued under Section 158BD invalid.

Notice under Section 158BD was invalidated on account of undue delay in recording satisfaction; the Tribunal was right to quash proceedings on that ground.

Deletion of addition as undisclosed income - Block assessment under Section 158BD of the Act - Delay vitiating block assessment proceedings - Whether the addition of undisclosed income for the block period should stand despite the infirmity in issuance of notice under Section 158BD - HELD THAT: - The Assessing Officer made an addition for the block period following the impugned notice. Because the Court found the notice and underlying satisfaction to be invalid for undue delay, the consequential block assessment and the addition in respect of the block period could not be sustained. The Tribunal's deletion of the addition was therefore upheld as a necessary consequence of quashing the assessment proceedings.

Addition declared unsustainable and deleted; Tribunal's deletion affirmed.

Final Conclusion: Tax Appeal dismissed; assessment proceedings under Section 158BD quashed for undue delay in recording satisfaction and the deletion of the addition for the block period is upheld.

Revisional jurisdiction under section 264 - Waiver of right of appeal - Prohibition on exercise of revision where appeal lies and right not waived - Effect of revisional order vis-a -vis pending appellate proceedings - Obligation of appellate authority to respect subsisting revisional orders

Revisional jurisdiction under section 264 - Waiver of right of appeal - Prohibition on exercise of revision where appeal lies and right not waived - Validity of exercise of revisional power under section 264 when an appeal before the Commissioner (Appeals) was pending but the assessee had communicated withdrawal of the appeal and filed a revision petition. - HELD THAT: - The Court found that subsection (4) of section 264 prohibits exercise of revisional powers where an appeal lies and the assessee has not waived the right of appeal. On the facts the assessee filed a revision petition under section 264 and contemporaneously communicated withdrawal of the earlier appeal to the Commissioner (Appeals), thus making a clear choice to pursue revision rather than the appeal. Applying the statutory restriction, the revisional authority was entitled to proceed because the assessee had effectively relinquished the appellate route. The Court accepted the revisional authority's factual conclusion that the assessee had disclosed the long term capital gain in the gross total income and that there was no willful concealment; accordingly the revisional order setting aside the penalty was proper on merits and the exercise of power under section 264 was lawful in the circumstances. [Paras 7, 9]

The Commissioner lawfully exercised revisional jurisdiction under section 264 after the assessee withdrew the pending appeal and the revision was correctly allowed on merits.

Effect of revisional order vis-a -vis pending appellate proceedings - Obligation of appellate authority to respect subsisting revisional orders - Whether the Commissioner (Appeals) was entitled to decide the appeal on merits after the revisional authority had set aside the penalty order. - HELD THAT: - The Court held that once a revisional order setting aside the penalty stands in force, the appellate authority must respect that order and may not proceed to independently examine and pronounce upon the same penalty order. Allowing the Commissioner (Appeals) to decide the appeal after the revisional order resulted in two parallel and conflicting quasi judicial determinations, which the Court described as inappropriate. Unless the revisional order is set aside by a competent authority or court, its effect must be permitted to operate and the appellate authority should not override or duplicate that determination. [Paras 10]

The Commissioner (Appeals) acted improperly in deciding the appeal after the revisional order had set aside the penalty; the appellate authority ought to have given effect to the revisional order.

Final Conclusion: The petition is disposed of: the revisional order under section 264 was validly passed and correctly set aside the penalty; the appellate authority should not have proceeded to decide the appeal after the revisional order, and the Court accordingly upheld the revisional order and criticised the appellate action.

Penalty under section 271C - Reasonable cause - Section 273B - immunity from penalty if reasonable cause proved - Concurrent finding of fact - Deletion of penalty by Commissioner (Appeals) and Tribunal

Penalty under section 271C - Reasonable cause - Section 273B - immunity from penalty if reasonable cause proved - Concurrent finding of fact - Whether penalty under section 271C could be sustained where the assessee had shown reasonable cause and the case fell within the protection of section 273B. - HELD THAT: - The Assessing Officer imposed penalty under section 271C for failure to deduct and deposit TDS. The assessee explained delay on account of non availability of funds, delay in receipt from Government bodies and a dispute with the contractor. The Commissioner (Appeals) accepted the explanation, recorded that the reason for delay was neither controverted nor shown to be false, and deleted the penalty under section 273B. The Tribunal concurred, noting that the assessee had deposited the tax with interest and had proved reasonable cause for the delay. Section 273B provides that notwithstanding section 271C no penalty shall be imposable if reasonable cause is proved. The courts below have recorded concurrent findings of fact that reasonable cause existed; such factual findings justified invoking section 273B and precluded sustaining the penalty. [Paras 6, 7, 8, 9]

Penalty under section 271C could not be sustained; penalty deleted as case falls within section 273B on the concurrent finding of reasonable cause.

Final Conclusion: The appeal is dismissed summarily; there is no substantial question of law as the Tribunal correctly upheld the deletion of penalty under section 273B after concurrent factual findings that reasonable cause existed for the delay.

Deduction under section 54 - Cost of the new residential house - Artificial splitting of sale consideration - Composite contract / integral deal - Section 54F applicability

Deduction under section 54 - Cost of the new residential house - Artificial splitting of sale consideration - Composite contract / integral deal - Whether the amount of Rs. 78,00,000 paid for purchase of the residential unit, including an Rs. 18,00,000 component described as payment for furniture and fixtures under a separate agreement, constitutes the "cost of the residential house so purchased" for grant of deduction under section 54/54F. - HELD THAT: - The Tribunal examined the banakhat (agreement to sell) dated 19 January 2011 and the subsequently executed sale deeds and agreements and found that the parties fixed the sale consideration at Rs. 78,00,000 in the notarized agreement to sell. Although the transaction was reflected in two registered instruments - one describing payment of Rs. 60,00,000 for the property and another describing Rs. 18,00,000 for furniture and fixtures - the Tribunal concluded that the splitting was artificial and could not be treated in isolation. The statutory test focuses on the "cost of the residential house so purchased," which may include items that are an integral part of the house when sold as a package (for example, fixtures, fittings and other amenities). Given the unambiguous terms of the agreement to sell that fixed the total consideration at Rs. 78,00,000 and the fact that the assessee had no option to avoid the Rs. 18,00,000 component, the Tribunal held that the composite amount is the cost of the new asset. The proper remedy, if any, against an artificial segregation by the seller was to treat the true consideration as house-sale consideration rather than to deny the buyer the benefit of section 54/54F. The Tribunal further observed that the departmental representative was heard on this ground and that Rule 11 permits the Tribunal to decide on such a ground when the affected party has had adequate opportunity to be heard. [Paras 7, 8, 9, 10]

The Rs. 78,00,000 paid for the residential unit, including the Rs. 18,00,000 component for furniture and fixtures, is the cost of the new residential house for purposes of deduction under section 54/54F; the disallowance of Rs. 18,00,000 is to be deleted.

Final Conclusion: Appeal allowed: the Tribunal directs deletion of the disallowance and grants the assessee deduction under section 54/54F by treating the composite consideration of Rs. 78,00,000 as the cost of the new residential house for AY 2011-12.

Penalty under section 271(1)(c) - defective show cause notice under section 274 - requirement to specify charge of concealment or furnishing inaccurate particulars - principle favouring view beneficial to the assessee where conflicting precedents exist - natural justice - opportunity to be heard

Penalty under section 271(1)(c) - defective show cause notice under section 274 - requirement to specify charge of concealment or furnishing inaccurate particulars - Validity of imposition of penalty under section 271(1)(c) where the show cause notice issued under section 274 did not specify whether proceedings were for concealment of particulars of income or for furnishing inaccurate particulars of income. - HELD THAT: - The Tribunal found that the show cause notice issued under section 274 did not indicate whether the penalty proceedings were initiated for concealment of particulars of income or for furnishing inaccurate particulars of income and that the improper portions of the printed proforma were not struck out. Having regard to conflicting judicial precedents, the Tribunal followed the view of the Hon'ble Karnataka High Court (as applied in Manjunatha Cotton & Ginning Factory and followed in later Karnataka decisions) that a notice which fails to specify the charge is defective and cannot sustain a penalty under section 271(1)(c). The Tribunal rejected the Revenue's submission that any defect in form is immaterial where the charge is otherwise discernible, noting that in the present case the assessment/order did not clearly record the specific charge relied upon when initiating penalty proceedings. On that basis the initiated penal proceedings were held to be unsustainable. [Paras 10, 11]

Imposition of penalty under section 271(1)(c) set aside; penalty cancelled and the appeal allowed.

Final Conclusion: The Tribunal allowed the appeal and cancelled the penalty imposed under section 271(1)(c) because the show cause notice under section 274 failed to specify whether proceedings were for concealment of income or for furnishing inaccurate particulars, rendering the penalty proceedings unsustainable.

Deductibility of expenses wholly and exclusively incurred in connection with transfer of a capital asset - Requirement of tangible evidence to substantiate brokerage and travel, lodging and fooding expenses - Allowability of partial deduction where expenses are partly personal and partly for transaction - Section 54EC exemption conditional on actual investment in specified bonds within prescribed period - Non-entitlement to exemption in absence of actual investment despite inability to invest due to seizure

Deductibility of expenses wholly and exclusively incurred in connection with transfer of a capital asset - Requirement of tangible evidence to substantiate brokerage and travel, lodging and fooding expenses - Allowability of partial deduction where expenses are partly personal and partly for transaction - Allowance of claimed brokerage and other travel/lodging/fooding expenses incurred in connection with sale of ancestral land - HELD THAT: - The Assessing Officer disallowed Rs.4.5 lakhs claimed as brokerage and other expenses for want of documentary evidence. The CIT-A accepted the claim for brokerage of Rs.1.5 lakhs on the basis of contemporaneous statements recorded during search proceedings and common commercial practice, and allowed 50% of the claimed Rs.3 lakhs other expenses as being partly transaction-related and partly personal. The Tribunal found no reason to disturb the appellate conclusion: the assessee produced no documentary vouchers for travel, lodging and fooding and the visit extended beyond the period necessary to complete the sale, justifying a finding that those expenses were partly personal. In these circumstances the restriction of allowance of other expenses to 50% (i.e. Rs.1.5 lakhs) and deletion of disallowance qua brokerage were held reasonable and affirmed. [Paras 10]

The CIT-A's reduction of the AO's disallowance - deletion of brokerage of Rs.1.5 lakhs and allowance of 50% of other expenses (Rs.1.5 lakhs) - is upheld.

Section 54EC exemption conditional on actual investment in specified bonds within prescribed period - Non-entitlement to exemption in absence of actual investment despite inability to invest due to seizure - Claim of exemption under section 54EC in respect of capital gains where the alleged investible amount was seized prior to investment - HELD THAT: - Section 54EC permits exemption only where the assessee has invested the capital gains in specified long-term bonds within the statutory time limit. The assessee admitted no actual investment was made and relied on the fact that sale proceeds were seized by revenue authorities before investment could be effected. The Tribunal rejected the submission that custody of seized funds by the Government can be equated to investment by the assessee, and observed that the assessee could have arranged funds from other sources but did not make any investment as required by the statutory provision. Consequently, in absence of any compliance with the mandatory condition of actual investment in specified bonds within the prescribed time, the claim of exemption was correctly disallowed by the lower authorities. [Paras 17]

The disallowance of the claimed section 54EC exemption of Rs.40,00,000/- is confirmed.

Final Conclusion: The ITAT dismisses the appeal: the appellate authority's allowance of brokerage and part allowance of other expenses is upheld, and the denial of exemption under section 54EC for lack of actual investment is affirmed.

Section 2(22)(e) - deemed dividend - accumulated profits - payment made out of third party funds - characterisation of advance versus deposit - Appellate Tribunal's power to decide points not raised before lower authorities

Section 2(22)(e) - deemed dividend - accumulated profits - payment made out of third party funds - Whether the advance of Rs. 12,00,000/- from M/s Saamag Infrastructure Ltd. to the assessee is exigible to tax as deemed dividend under section 2(22)(e) or was paid out of funds received by the payer from a third party and hence not from accumulated profits. - HELD THAT: - The Tribunal observed that the Assessing Officer and the CIT(A) treated the Rs. 12,00,000/- advance as a deemed dividend under section 2(22)(e) because of common substantial shareholding. The assessee, for the first time before the Tribunal, produced bank statements and contended that Saamag Infrastructure Ltd. paid the amounts to the assessee out of sums earlier received from Zenith Township Pvt. Ltd. and therefore the payments were not out of accumulated profits of the payer. Having regard to the material on record and in the interest of justice, the Tribunal held that the new factual contention and the bank statements warrant fresh consideration and verification by the CIT(A). Consequently the Tribunal restored the matter to the file of the CIT(A) with a direction to adjudicate the question afresh after giving the assessee an opportunity of being heard. [Paras 20, 22]

Issue remanded to the CIT(A) for fresh adjudication on whether the payments were made out of accumulated profits or out of third party funds; addition under section 2(22)(e) not sustained by the Tribunal pending fresh decision.

Appellate Tribunal's power to decide points not raised before lower authorities - Whether the Tribunal may entertain the new contention (that the payments were made out of third party funds) though it was not pressed before the CIT(A). - HELD THAT: - The Tribunal rejected the Department's objection that the contention was raised for the first time. Relying on the principle that the Tribunal has plenary jurisdiction to decide appeals and may consider questions of fact or law not raised before lower authorities when material is on record, the Tribunal referred to the Supreme Court authority cited by the assessee and held that, where full details are available on the record, the assessee may raise new contentions before the Tribunal. Accordingly the Tribunal allowed the assessee to proceed with that contention and directed fresh adjudication by the CIT(A). [Paras 21]

Tribunal held it could entertain the new contention and rejected the Revenue's plea of non admissibility; permitted remand for fresh adjudication.

Final Conclusion: The appeal is allowed for statistical purposes; the question whether the Rs. 12,00,000/- constitutes a deemed dividend under section 2(22)(e) or was paid out of third party funds is remitted to the CIT(A) for fresh consideration after giving the assessee an opportunity of being heard; the Tribunal permitted the assessee to raise the new contention and rejected the Revenue's objection to its admission.

Rectification of mistake apparent from record - limitation for rectification under Section 254(2) - condonation of delay - recall of Tribunal order on rectification application - prospective effect of amendment to limitation period

Rectification of mistake apparent from record - limitation for rectification under Section 254(2) - condonation of delay - prospective effect of amendment to limitation period - Maintainability of the miscellaneous application for recalling the Tribunal's order filed beyond the statutory limitation under Section 254(2). - HELD THAT: - The Tribunal recorded that the impugned order was certified and sent to the assessee on 21.04.2017 and the present miscellaneous application was filed on 19.01.2018, beyond six months from the end of the month in which the order was passed. The Tribunal observed that after the Finance Act, 2016 (w.e.f. 01.06.2016) the limitation for rectification under Section 254(2) was reduced to six months from the end of the month in which the order was passed and that there is no provision in the Income-tax Act conferring power to condone delay in filing such miscellaneous applications. The Tribunal further held that the amendment to Section 254(2) must be given prospective effect so that where orders pre-date the amendment the six-month reckoning begins from 01.06.2016; nevertheless, the present application lay outside the prescribed period. Reliance was placed on earlier coordinate decisions, including the Tribunal and High Court decisions referred to in the order, to the effect that rectification/recall applications fall under Section 254(2) and that the Tribunal lacks statutory power to condone delay beyond the period prescribed therein. Applying these principles to the facts, the Tribunal concluded that the miscellaneous application is barred by limitation and therefore not maintainable.

Miscellaneous application dismissed as barred by limitation and not maintainable.

Final Conclusion: The miscellaneous application to recall the Tribunal's order is dismissed as barred by limitation under Section 254(2) and not maintainable; no condonation of delay is available under the Income tax Act.

Income from business vs Income from other sources - expenditure wholly and exclusively for business - deduction under section 37(1) - allowability of administrative/establishment expenses to maintain corporate status - bad debt deduction - section 36(1)(vii) and applicability of TRF Ltd

Income from business vs Income from other sources - Interest earned on inter-corporate deposits is to be treated as income from other sources and not as business income. - HELD THAT: - The Tribunal found that the assessee had historically treated interest receipts as "other income" in its financial statements and tax returns and there was no material change in facts to justify recharacterising those receipts as business income. The memorandum of association showed manufacturing as the main object and financial activity only as ancillary; the assessee had discontinued manufacturing operations in the year but had not shown that financial services were its main business. The assessee's own classification of the receipts as other income in the books, lack of evidence of carrying on a lending business, and absence of material change warranted treating the interest as income from other sources. The authorities below were therefore upheld on this classification point. [Paras 6, 7]

Interest income treated under the head "Income from other sources"

Expenditure wholly and exclusively for business - deduction under section 37(1) - allowability of administrative/establishment expenses to maintain corporate status - General administrative and incidental expenses incurred to maintain the corporate status are allowable under section 37(1). - HELD THAT: - Although the AO disallowed the expenditure on the ground that the assessee had not carried on its manufacturing business and there was no nexus between the expenses and earning of interest, the Tribunal held that so long as the company remained in operation (name not struck off) it was obliged to maintain an establishment and discharge statutory obligations. Office rent, auditor's remuneration and small miscellaneous expenses incurred to keep the corporate entity functional were held to be allowable under section 37(1) as expenditures wholly and exclusively for the purposes of carrying on the company's affairs. The Tribunal rejected reliance on authorities concerned with section 57(iii) (relating to income from other sources) as inapplicable where the claim is made under section 37(1). [Paras 8, 11]

Expenditure claimed as general administrative/establishment expenses allowed u/s 37(1)

Bad debt deduction - section 36(1)(vii) and applicability of TRF Ltd - Claim for bad debts written off is not finally adjudicated by the Tribunal but is remanded to the AO for fresh consideration in light of TRF Ltd. - HELD THAT: - The assessee sought admission of an additional ground based on the Supreme Court's decision in TRF Ltd that writing off a bad debt in the books may suffice for deduction under section 36(1)(vii). The Tribunal admitted the additional ground but observed that the AO had not had the opportunity to examine the claim in the light of TRF Ltd. Given the factual and evidential aspects still to be considered by the assessing officer, the Tribunal set aside the issue and directed the AO to decide the bad-debt claim afresh in accordance with the Supreme Court's ruling. [Paras 16, 17]

Bad-debt deduction remanded to the AO for fresh adjudication in light of TRF Ltd

Final Conclusion: Appeals partly allowed: interest income to be treated as income from other sources; general administrative expenses incurred to maintain corporate status allowed under section 37(1); claim for bad debts written off remanded to the Assessing Officer for fresh consideration in the light of the Supreme Court decision in TRF Ltd.

Taxability of interest on earmarked public funds - infrastructure development fund treated as corpus and not assessable income - trustee/nominee character of statutory authority vis-a -vis state funds - binding effect of coordinate-bench ITAT precedent in assessee's own case

Taxability of interest on earmarked public funds - infrastructure development fund treated as corpus and not assessable income - binding effect of coordinate-bench ITAT precedent in assessee's own case - Whether interest accrued on FDRs forming part of the Infrastructure Development Fund maintained by the statutory authority is taxable as the assessee's income for AY 2010-11 and AY 2011-12. - HELD THAT: - The Tribunal examined the statutory authority status of the assessee, the Government Order directing monies to be set apart for infrastructure purposes and the nature of control over such funds. It accepted the principle applied by the coordinate ITAT Bench in the assessee's own earlier case (AY 2006-07) that where interest receipts do not accrue to the assessee as an owner and are available for disposal only in accordance with government directions for infrastructure development, such interest forms part of the corpus earmarked for the specified purpose and cannot be treated as the assessee's income. The Tribunal noted that the facts of the appeals for AY 2010-11 and AY 2011-12 were materially similar to the earlier ITAT decision and, applying judicial discipline and the binding effect of that coordinate-bench precedent in the assessee's own case, held that the interest in question is not assessable as the assessee's income. The Tribunal considered contrary findings in the assessment records (including the CIT(A)'s approach in AY 2010-11) but found them distinguishable or overruled by the coordinate-bench decision which had attained finality for the issue in the assessee's case. [Paras 10, 11]

Interest accrued on FDRs forming part of the Infrastructure Development Fund is not taxable in the hands of the assessee for AY 2010-11 and AY 2011-12; the revenue appeal is dismissed and the assessee's appeal is allowed.

Final Conclusion: Following the Tribunal's earlier coordinate-bench decision in the assessee's own case and on the view that the interest earnings are earmarked corpus subject to government directions (and do not accrue as the assessee's income), the addition was deleted for the appeals; the revenue's appeal is dismissed and the assessee's appeal is allowed.

Conformity with Board's Instruction dated 30.01.2012 - Requirement of BIS Standard Mark/Symbol for Run Flat Tyres - Embossing of RF marking on tyres - Release versus absolute confiscation of imported goods for non-conformity - Remand for reconsideration upon compliance

Requirement of BIS Standard Mark/Symbol for Run Flat Tyres - Embossing of RF marking on tyres - Release versus absolute confiscation of imported goods for non-conformity - Whether tyres embossed with RF but lacking the prescribed symbol could be released instead of being absolutely confiscated if the symbol is affixed prior to clearance. - HELD THAT: - The Tribunal examined the Board Instruction of 30.01.2012 which treats run flat tyres as exempt from the Quality Control Order provided they are marked RF and carry the specified symbol. It was found not in dispute that the tyres bore the embossed mark RF; the only deficiency was the absence of the symbol. The Tribunal distinguished decisions relied on by the Revenue: Aban Exim Pvt. Ltd. had been remanded by the High Court and did not conclusively establish prohibition, and Jagdev Damodaran concerned import of items requiring a licence and thus was not analogous. In the circumstances, the Tribunal accepted the appellant's undertaking to affix the symbol and held that once the symbol is affixed as required by the instruction, BIS registration would not be necessitated and the ground for confiscation would not subsist. The Tribunal therefore directed that the symbol be put on the tyres prior to clearance and that the matter of release be reconsidered by the authority. [Paras 5, 6, 7]

Tyres bearing RF embossing but lacking the symbol shall have the symbol affixed before clearance; once affixed, BIS registration is not required and the basis for absolute confiscation ceases.

Remand for reconsideration upon compliance - Release versus absolute confiscation of imported goods for non-conformity - Whether the adjudicating/adjusting authority should reconsider release of the goods after the appellant complies by affixing the required symbol. - HELD THAT: - The Tribunal directed that upon affixation of the prescribed symbol by the appellant, the adjusting authority shall reconsider the question of release and pass an appropriate order in accordance with law. The direction effectively remands the matter to the authority for fresh consideration limited to verification of compliance and consequent action on release, rather than a fresh adjudication on unrelated grounds. [Paras 7]

Matter remitted to the adjusting authority to reconsider release of goods after the appellant affixes the required symbol and to pass an appropriate order in accordance with law.

Final Conclusion: Appeal disposed by directing the appellant to affix the prescribed symbol on the run flat tyres before clearance; upon such compliance the adjusting authority is directed to reconsider release and pass appropriate orders, thereby removing the basis for absolute confiscation if requirements are met.

Rectification of clerical error - review or modification (ROM) application - pendency of litigation - prejudice to party

Rectification of clerical error - pendency of litigation - prejudice to party - Whether the reference in the Tribunal's order to 'Thirteen (13) years have passed' was a verifiable error warranting rectification by ROM. - HELD THAT: - The Tribunal examined the chronology and noted that the original matter was initiated in 2001. The Bench's order dated 24.08.2016 did not state that the 13 years referred to the period since that Bench order; rather, on an overall view of the litigation, the period since initiation exceeds 13 years. Consequently the expression in the earlier order cannot be treated as a clerical or factual error requiring rectification. Further, the Tribunal found that the mention of the period of pendency did not prejudice the Revenue nor obstruct the process of re-adjudication. Given these findings, the factual assertion in the earlier order was not shown to be incorrect or to have caused any legal prejudice that would justify intervention by ROM. [Paras 4]

The alleged error in the earlier order is not established and does not warrant rectification; the ROM application is dismissed.

Review or modification (ROM) application - Maintainability of the ROM application filed by the Revenue. - HELD THAT: - Having determined that there was no demonstrable error in the Tribunal's reference to the period of pendency, and that the mention caused no prejudice or hindrance to re-adjudication, the Tribunal concluded that the ROM remedy was not available to the Revenue for the purpose of altering that reference. The application therefore lacked a sustainable basis. [Paras 4]

The ROM application is not maintainable and is dismissed.

Final Conclusion: The Tribunal held that the reference to 'Thirteen (13) years have passed' in the earlier order did not constitute a rectifiable error, that the mention did not prejudice the Revenue or impede re-adjudication, and therefore dismissed the Revenue's ROM application.

Functus officio - locus standi of adjudicating authority in appellate proceedings - competence to intervene in an appeal against own order - bench hearing the appeal entitled to dispose miscellaneous applications arising from the appeal - expunction of judicial record not recognized as statutory remedy - validity of ex parte proceedings under appellate procedure rules - requirements of authorised representation under tribunal procedure rules

Functus officio - locus standi of adjudicating authority in appellate proceedings - Status and competence of an adjudicating authority to intervene in an appeal against its own order - HELD THAT: - The Tribunal held that an adjudicating authority becomes functus officio upon conclusion of proceedings arising from a show cause notice and, thereafter, has no independent status to initiate or intervene in appellate proceedings against its order. The Customs Act scheme contemplates only a narrow, statutory revival of the adjudicating authority's role where expressly provided; otherwise the authority is bereft of initiative and any attempt by it to act in the appellate forum is beyond its competence. The Tribunal relied on constitutional and precedent principles recognising the finality of the adjudicator's existence post-adjudication and concluded that the present applications fall outside the scope of empowerment under the statute. [Paras 5, 6, 16, 19, 20]

An adjudicating authority is functus officio after conclusion of proceedings and is not competent to intervene in appeals against its own order; the applications by the adjudicating authority were beyond statutory scope on this ground.

Requirements of authorised representation under tribunal procedure rules - competence to make miscellaneous applications - Validity of the applicant's locus and representation to bring miscellaneous applications before the Tribunal - HELD THAT: - The Tribunal found on the record that the applicant was not the respondent in the appeals and had not furnished proper authorization under the Tribunal's procedure rules; the person purportedly acting had authority only in respect of a specified original order and such authorization did not extend to making the present applications. The applicant's failure to appear or to be properly represented and his lack of locus standi undermined the competence of the applications. [Paras 2, 4, 5, 23, 24]

The applicant lacked locus and proper authorised representation for making the miscellaneous applications; the applications were incompetent on this ground.

Bench hearing the appeal entitled to dispose miscellaneous applications arising from the appeal - expunction of judicial record not recognized as statutory remedy - validity of ex parte proceedings under appellate procedure rules - Proper forum and substantive availability of the reliefs sought (transfer, expunging records, adjournment) - HELD THAT: - The Tribunal held that only the bench hearing the appeal can dispose of miscellaneous matters arising from that appeal and exercised that power to deal with all four applications. Expungement of records was held not to be a statutory remedy; ex parte proceedings are valid in law under the Tribunal's procedure rules where the appellant is present and the respondent may be heard if necessary. Adjournment is a judicial prerogative answerable to higher courts and not the subject of unilateral intervention by an adjudicating authority. [Paras 1, 7, 21, 22, 24]

All four miscellaneous applications were dismissed: transfer/bench-change was not permissible; expungement is not a statutory remedy; ex parte proceedings were valid; adjournment and other procedural reliefs are within the tribunal's discretion and not to be dictated by the adjudicating authority.

Accountability of public officers to the tribunal process - Direction to the adjudicating officer to explain conduct before the Tribunal - HELD THAT: - While declining to speculate on motives, the Tribunal recorded that the applicant's assertions were made without due regard to truth and that the conduct impacted the dignity of the Tribunal. Although the applications were dismissed, the Tribunal directed the applicant to appear before the Bench on the next date of hearing to explain his stand and to make any statement in mitigation of the conduct that led to filing the applications. [Paras 24, 25, 26]

Applicant directed to appear before the Bench on the next date to explain his conduct and make any mitigation; the Tribunal reserved the record for that purpose.

Final Conclusion: The miscellaneous applications filed by the adjudicating authority were dismissed: an adjudicating authority is functus officio and cannot intervene in appeals against its order; the applicant lacked locus and proper authorization; only the bench hearing the appeal can decide miscellaneous matters arising from the appeal; expungement of records is not a statutory remedy and ex parte proceedings under the Tribunal rules are valid where appropriate. The applicant is directed to appear before the Bench to explain his conduct.

Condonation of delay - limitation - administrative remedy under regulations - revocation/deregistration of courier licence - admission of appeal for hearing - withdrawal of appeal

Condonation of delay - limitation - admission of appeal for hearing - administrative remedy under regulations - Application for condonation of delay in filing appeal against deregistration was allowed and the appeal was admitted for hearing with an early hearing date. - HELD THAT: - The appellant explained that after the Commissioner's order deregistering their courier registration dated 26 November 2015 (served 3 December 2015), they availed the statutory remedy by submitting a representation to the Chief Commissioner on 5 January 2016, which was dismissed by order dated 14 September 2016 (served 16 September 2016). The Tribunal accepted that the period legitimately spent in pursuing the remedy before the Chief Commissioner (about 253 days) is to be excluded for limitation purposes and that there was no deliberate delay by the appellant in preferring the appeal. The Tribunal also noted that the matter concerned the appellant's licence with no revenue implication and, in the interest of justice and the appellant's livelihood, admitted the appeal for hearing and granted an early hearing on 31.1.2018. [Paras 4, 5]

Condonation of delay allowed; appeal admitted for hearing and early hearing fixed.

Revocation/deregistration of courier licence - withdrawal of appeal - Second appeal against the Chief Commissioner's rejection of the representation was withdrawn and disposed of. - HELD THAT: - The appellant chose not to press the appeal filed against the Chief Commissioner's order of 14.9.2016 because the main appeal against the deregistration (C/87576/16) had been admitted for hearing. The Tribunal recorded the appellant's election and disposed of the appeal as withdrawn; the related miscellaneous application was also disposed of. [Paras 7]

Appeal disposed of as withdrawn and miscellaneous application disposed of.

Final Conclusion: The application for condonation of delay in appeal C/87576/16 was allowed and the appeal admitted for hearing with an early hearing fixed; the separate appeal C/85043/17 was withdrawn and disposed of.

Restoration of appeal - recall of ex-parte order - condonation of non-appearance for reasons beyond control - registry correction of appeal classification - restoration to original number

Restoration of appeal - recall of ex-parte order - condonation of non-appearance for reasons beyond control - registry correction of appeal classification - Application for restoration of the appeal (registered as ROM) and recall of the ex-parte order dated 22.5.2017; correction of registry entry to ROA and restoration of the appeal to its original number. - HELD THAT: - The appellant filed a restoration application supported by an affidavit explaining diligent pursuit of the appeal and inability to appear on 22.5.2017 due to illness of the representative. The Tribunal noted the learned AR's opposition but found that non-appearance resulted from circumstances beyond the appellant's control and there was no deliberate default. In the interest of justice the Tribunal directed the Registry to correct the application classification from ROM to ROA, recalled the ex-parte order dated 22.5.2017 and restored the appeal to its original number. A final hearing date for the appeal was fixed. [Paras 1, 4]

Registry to correct ROM to ROA; ex-parte order dated 22.5.2017 recalled; appeal restored to original number and listed for final hearing on 26.2.2018.

Final Conclusion: The restoration application is allowed: the registry entry is to be corrected to ROA, the ex-parte order dated 22.5.2017 is recalled, the appeal is restored to its original number and listed for final hearing on 26.2.2018.

Misdeclaration of imported goods - classification as Copper Wire Scrap (Druid grade) - seizure, confiscation and re-export of imported goods - redemption fine as consequence of home-consumption - penalty under Section 112(a) of the Customs Act, 1962 - proprietor and proprietary firm cannot both be penalised - broker/agent liability - Hazardous Wastes (Management, Handling and Transboundary Movement) Rules, 2008 - registration for import of insulated copper wire scrap

Classification as Copper Wire Scrap (Druid grade) - misdeclaration of imported goods - Hazardous Wastes (Management, Handling and Transboundary Movement) Rules, 2008 - registration for import of insulated copper wire scrap - Correctness of the description and classification of the imported consignment - HELD THAT: - The Tribunal accepted the adjudicating authority's conclusion that the consignment comprised insulated high-voltage copper cable pieces falling within the description of insulated copper wire scrap (Druid grade). Although commercial invoices, pre-shipment inspection certificate and Form-9 recorded component percentages (copper, lead, plastic) and the Bill of Entry declared separate items (copper scrap, lead scrap and insulation material), the material composition and construction established that the goods were in substance Copper Wire Scrap Druid Grade and not separate consignments of copper, lead and insulation. The discrepancy between the registration held by the appellant (covering Basal No. B-1010 copper scrap) and the DRI/departmental classification gave rise to the dispute; the Tribunal treated the classification as correct while noting the documentary evidence furnished under the Hazardous Wastes Rules did not excuse the incorrect Bill of Entry declaration.

The classification as Copper Wire Scrap (Druid grade) was sustained and the finding of misdeclaration in the Bill of Entry was upheld.

Seizure, confiscation and re-export of imported goods - redemption fine as consequence of home-consumption - Whether the redemption fine imposed in respect of goods ordered for re-export is maintainable - HELD THAT: - The Tribunal observed that redemption fine operates to 'redeem' a violation by permitting enjoyment of goods for home consumption despite statutory contravention. Where goods are ordered to be re-exported and not cleared for home consumption, imposition of a redemption fine is incongruous with that remedy. Applying this principle to the facts, the Tribunal concluded that imposing a redemption fine where the operative order directs re-export is disproportionate and unwarranted.

The redemption fine imposed was set aside.

Penalty under Section 112(a) of the Customs Act, 1962 - proprietor and proprietary firm cannot both be penalised - broker/agent liability - Proper quantum and attribution of penalties imposed on the appellants - HELD THAT: - The Tribunal accepted that a penalty was warranted for the incorrect declaration in the Bill of Entry but found the amount imposed by the adjudicating authority excessive. In the interest of justice the Tribunal reduced the penalties levied on M/s Sri Lalkamal Enterprises and M/s Sterling Steels to a lesser sum. The Tribunal further applied the established principle that a proprietor and his proprietary concern cannot both be separately penalised for the same act, and therefore set aside the penalties imposed on the individual proprietors named. Finally, having regard to the role of the appellant identified as a broker/agent who only facilitated the transaction between seller and buyer, the Tribunal concluded it would be unfair to penalise him and accordingly rescinded the penalty imposed on that person.

Penalties on M/s Sri Lalkamal Enterprises and M/s Sterling Steels reduced to a moderated amount; penalties on the individual proprietors set aside; penalty on the broker/agent set aside.

Final Conclusion: The Tribunal upheld the classification of the imported goods as Copper Wire Scrap (Druid grade) and sustained the order for confiscation with re-export, but set aside the redemption fine as inappropriate when goods are ordered for re-export; it reduced the penalties on the corporate importers to a lower amount and discharged penalties imposed on the individual proprietors and the broker/agent. Appeals are partly allowed accordingly.

Government's litigation policy - bar on departmental appeals below monetary threshold - exceptions for classification, refund or legal and recurring nature - appeal dismissed on policy grounds without adjudicating merits

Government's litigation policy - bar on departmental appeals below monetary threshold - exceptions for classification, refund or legal and recurring nature - Maintainability of the departmental appeal in view of the Government's litigation policy limiting appeals where the amount involved does not exceed Rs. 10 lakhs and exceptions thereto. - HELD THAT: - The Tribunal applied the Board Circulars F.No.390/Misc./163/2010-JC dated 17/8/2011 and its amendment dated 17/12/2015, which restrict the Revenue from filing appeals before this Tribunal where the duty, penalty or interest involved is not in excess of Rs. 10 lakhs, subject to specified exceptions. The amount in dispute in this case was found to be below the Rs. 10 lakhs threshold and the case did not fall within the carved-out categories of classification, refund, or matters of legal and recurring nature. In consequence, the appeal was not entertained on merits but dismissed in terms of the Government's litigation policy. [Paras 3, 4]

Appeal dismissed under the Government's litigation policy as the amount involved is not in excess of Rs. 10 lakhs and no exception applies; merits not considered.

Final Conclusion: The departmental appeal is dismissed under the applicable Government litigation policy because the amount involved is below the prescribed threshold and none of the statutory exceptions applies; the Tribunal did not decide the merits.

Levy of duty on liquid bulk inputs - import completed on presentation of bill of entry or order to warehouse - ocean loss / pilferage not taxable until import is complete - transaction value excludes post importation events - demurrage charges as post importation event - distinction between ad valorem and specific duty irrelevant to completion of import

Levy of duty on liquid bulk inputs - ocean loss / pilferage not taxable until import is complete - distinction between ad valorem and specific duty irrelevant to completion of import - Duty on liquid bulk inputs must be levied on the quantity actually landed and not on the quantity declared as loaded when loss occurred during transit; ocean loss/pilferage cannot be taxed before import is complete. - HELD THAT: - The Tribunal applied the principle affirmed by the Hon'ble Supreme Court in Mangalore Refinery & Petrochemicals Ltd. that customs duty-whether ad valorem or specific-cannot be levied on goods lost, pilfered or destroyed prior to completion of import. Import is not complete until a bill of entry for home consumption is presented or an order to warehouse is made; consequently, administrative circulars purporting to treat ocean loss as taxable contrary to that statutory scheme are untenable. The Tribunal therefore held that duty cannot be imposed on the quantity shown as loaded when actual landed quantity is less due to ocean loss.

The demand based on declared loaded quantity was disallowed; duty to be levied only on quantity actually landed.

Transaction value excludes post importation events - demurrage charges as post importation event - demurrage not includible in customs valuation - Charges (such as demurrage) incurred after the goods reached Indian ports are post importation events and cannot be included in the transaction value for customs duty. - HELD THAT: - Relying on the Supreme Court's reasoning in the cited decisions, the Tribunal held that demurrage and similar charges arising after arrival at Indian ports are post importation in character and therefore cannot form part of the transaction value for assessment of customs duty. As these charges are incurred subsequent to importation, they are not attributable to the value of the imported goods at the time import is completed.

Inclusion of demurrage (and comparable post arrival charges) in transaction value was rejected.

Final Conclusion: Impugned orders set aside and both appeals allowed; consequential relief, if any, granted in favour of the appellant.

Amendment of documents under Section 149 of the Customs Act, 1962 - Discretion to amend shipping bills - Documentary evidence existing at time of export - Benefit under DEEC scheme - Delay and laches in seeking amendment

Amendment of documents under Section 149 of the Customs Act, 1962 - Documentary evidence existing at time of export - Delay and laches in seeking amendment - Discretion to amend shipping bills - Benefit under DEEC scheme - Whether the shipping bills, originally filed under the drawback scheme and exported between 29-12-1999 and 4-4-2000, could be amended after more than five years to claim DEEC benefits under Section 149. - HELD THAT: - The Tribunal noted that Section 149 permits amendment of documents only in the exercise of a judicious discretion and expressly conditions such amendment on documentary evidence that was in existence at the time of export. The appellant sought conversion of shipments to the DEEC scheme only on 12-9-2005, more than five years after export. The authority could not reasonably consider the belated request because the appellant had not produced, and did not file at the time of export, the documentary evidence necessary to establish entitlement to DEEC benefits. Section 149 does not confer an absolute right to amendment; it requires satisfaction of the condition that the documentary basis for amendment existed at the time of clearance or export. The Tribunal emphasised that a claimant must seek amendment without unreasonable delay and with reasons showing that the requisite documentary evidence was already on record at the time of shipment. The appellant failed to point to such contemporaneous documentary proof or to show justification for the long delay, and thereby failed to meet the condition and satisfy the exercise of discretion under Section 149. [Paras 4]

The belated application for amendment to convert the drawback shipping bills to DEEC benefit was refused and the appeal dismissed.

Final Conclusion: The Tribunal dismissed the appeal, holding that amendment under Section 149 is discretionary and permissible only on the basis of documentary evidence existing at the time of export; the appellant's belated request after more than five years, unsupported by contemporaneous documents or a satisfactory explanation for delay, did not satisfy the statutory condition for amendment.

Ineligible duty drawback - interest on inadmissible drawback - voluntary repayment and bona fide disclosure - confiscation of export goods under Section 113(ii) of the Customs Act, 1962 - penalty under Section 114(iii) of the Customs Act, 1962 - settlement under Section 127(5) and immunity under Section 127H of the Customs Act, 1962 - application of Rule 16 of the Drawback Rules, 1995 and Section 28(2) of the Customs Act, 1962 (procedural contention)

Ineligible duty drawback - interest on inadmissible drawback - voluntary repayment and bona fide disclosure - settlement under Section 127(5) of the Customs Act, 1962 - Settlement of the claimed ineligible duty drawback and interest and appropriation of amounts already paid. - HELD THAT: - The Bench found that the applicant had, during the period in dispute, claimed higher rate of drawback (Central Excise and Customs components together) instead of only the eligible Customs portion in a small fraction of shipping bills and, when pointed out by DRI, admitted the error and repaid the ineligible amounts with interest. The Bench treated the disclosure, cooperation, and subsequent voluntary detection and payment as indicative of bona fides and a case fit for settlement. Having examined the records, the Bench settled the differential duty-drawback at the stated amount and the interest thereon, and confirmed appropriation/adjustment of the amounts already paid so that no further liability subsists in respect of those amounts. [Paras 6, 7]

The ineligible duty-drawback is settled at the stated amount and the interest liability is settled; amounts already paid are appropriated and no further liability remains.

Confiscation of export goods under Section 113(ii) of the Customs Act, 1962 - penalty under Section 114(iii) of the Customs Act, 1962 - distinction between fraud and inadvertent error - Whether confiscation and penalty should be imposed on the applicant and the director; the Bench refrained from imposing any fine or penalty. - HELD THAT: - The Bench considered the Revenue's reliance on precedents allowing confiscation and penalty, but distinguished those cases on their facts (which involved deliberate fraud). Here, the erroneous claims occurred in a small percentage of the total shipping bills, the correct position was disclosed in ARE1/ARE2 in most instances, the applicant voluntarily detected and repaid further erroneous claims, and there was cooperation with investigators. The Bench observed that while goods can be held liable for confiscation in appropriate cases, it need not decide the general question of confiscation here and, on the facts, treated the conduct as inadvertent rather than fraudulent. In view of these mitigating circumstances, the Bench refrained from imposing any penalty on the company and on the director. [Paras 6, 7]

No fine or penalty is imposed on the applicant or on the director; immunity is granted subject to the usual condition against suppression/falsehood.

Final Conclusion: The Settlement Commission, on the facts, accepted bona fide disclosure and voluntary repayment, settled the ineligible drawback and interest at the amounts specified and appropriated the sums already paid, and refrained from imposing any fine or penalty, granting immunity under Section 127H subject to withdrawal if material particulars were withheld or false evidence given.

Symbolic possession - custody of the Court - ownership versus tenancy - official liquidator's rights in respect of non-owned property

Symbolic possession - custody of the Court - ownership versus tenancy - Direction to remove seal and notice placed by the Official Liquidator on the premises and consequent release of premises from the custody of the Court - HELD THAT: - The Court considered the Official Liquidator's reports which concluded that the premises were not the legal property of the company in liquidation and that the company was merely a tenant. The Official Liquidator, through counsel, accepted that no right, title or interest in the premises was claimed by the company in liquidation and consented to removal of the seal and notice affixed as a mark of symbolic possession. On that basis the Court directed the Official Liquidator to remove the seal and the notice placed on the main door within ten days. The Court further recorded that upon removal of the seal and notice the premises shall cease to be treated as in the custody of this Court.

Official Liquidator directed to remove the seal and notice within ten days; upon removal the premises will not be in the custody of the Court.

Final Conclusion: Application disposed of with direction to the Official Liquidator to remove the seal and notice affixed for symbolic possession within ten days, and the premises thereby released from the custody of this Court; remaining monetary claims were not pressed and no further orders were made.

Renting of Immovable Property Service - extended period of limitation - suppression with mala fide intention - benefit of doubt - penalty not imposable for absence of mala fide - retrospective amendment to validate levy

Extended period of limitation - suppression with mala fide intention - benefit of doubt - Extended period of limitation cannot be invoked for the demand relating to the period April 2008 to March 2012 in absence of proved suppression with mala fide intention. - HELD THAT: - The appellant had been paying service tax for other lettings but not in respect of the tenant M/s. Vishal Retail Limited, who had challenged the vires of the levy and was a petitioner in the Delhi High Court decision holding the levy ultra vires. Given that the appellant was under a bona fide belief grounded on that judicial pronouncement and there is no record demonstrating when any DGCEI investigation came to the departmental knowledge or that the appellant actively concealed the letting, the essential prerequisite for invoking the extended period - deliberate suppression or mala fide intention - is not established. In these circumstances the benefit of doubt accrues to the appellant and the extended period of limitation is not invokable; only the demand within the period of limitation stands sustained with interest.

Demand for the extended period is set aside; demand within the period of limitation is confirmed with interest.

Penalty not imposable for absence of mala fide - Renting of Immovable Property Service - Penalty cannot be imposed on the appellant for non-payment of service tax in respect of the premises let to M/s. Vishal Retail Limited in the absence of mala fide intention. - HELD THAT: - Since the adjudicatory finding is that the appellant acted under a bona fide belief arising from a judicial decision that the levy was ultra vires, and there is no material establishing deliberate concealment or mala fide conduct, the statutory requirement for levy of penalty is not satisfied. Consequently, imposing penalty in these circumstances is not warranted and the penalty was correctly set aside.

Penalty imposed for the period in dispute is set aside for lack of mala fide.

Final Conclusion: The appeal is partly allowed: demands based on the extended period are set aside for lack of proved suppression with mala fide; demands within the period of limitation are confirmed with interest; penalties are remitted.

Limitation for filing appeal - condonation of delay - power of the Commissioner (Appeals) to extend time for filing appeal - time limit and extension for filing appeal under Section 85(3A) of the Finance Act, 1994 - jurisdictional effect of an appeal being time-barred - remand for fresh adjudication on merits - requirement of a speaking order after affording opportunity of hearing - application of correct statutory provision

Limitation for filing appeal - condonation of delay - time limit and extension for filing appeal under Section 85(3A) of the Finance Act, 1994 - application of correct statutory provision - jurisdictional effect of an appeal being time-barred - Whether the appeals were barred by limitation and whether the Commissioner (Appeals) correctly applied the law in dismissing them as time-barred. - HELD THAT: - The Tribunal found that the adjudication order dated 04.06.2015 was received on 06.06.2015 and the appeals were filed on 18.08.2015, which is 10 days beyond the primary 60-day period but within the ensuing 30-day extension period contemplated by Section 85(3A) of the Finance Act, 1994. The Commissioner (Appeals) had erroneously referred to a non-existent provision (Section 35 of the Finance Act, 1944) and therefore did not apply the correct statutory provision governing limitation. As the Commissioner (Appeals) had power to condone delay for reasons satisfactorily explained, and the appellants furnished an explanation (the consultant was attending to a hospitalized mother) sufficient to justify the 10-day delay, the Tribunal held that the delay deserved to be condoned. Because the Commissioner (Appeals) had held the appeals to be time-barred, the subsequent examination on merits in the impugned order was beyond his jurisdiction and therefore could not stand. [Paras 3, 4, 5]

Delay of 10 days beyond 60 days condoned; impugned findings on limitation set aside and the Commissioner (Appeals)'s merits discussion held beyond jurisdiction.

Remand for fresh adjudication on merits - requirement of a speaking order after affording opportunity of hearing - Whether the matter should be remitted to the Commissioner (Appeals) for fresh decision on merits and the manner in which it should be decided. - HELD THAT: - Having set aside the impugned order insofar as it dismissed the appeals as time-barred and having held that the merits decision went beyond the Commissioner (Appeals)'s jurisdiction in the circumstances, the Tribunal directed that the appeals be remanded. The Commissioner (Appeals) is to decide the issues on merits afresh after granting the appellants sufficient opportunity of being heard and by passing a detailed speaking order dealing with the points raised. [Paras 5]

Appeals remanded to the Commissioner (Appeals) for fresh adjudication on merits with directions to afford hearing and pass a speaking order.

Final Conclusion: The Tribunal condoned the delay in filing the appeals (10 days beyond the 60-day period but within the subsequent 30-day extension under Section 85(3A) of the Finance Act, 1994), set aside the impugned orders insofar as they dismissed the appeals as time-barred and insofar as merits were decided beyond jurisdiction, and remitted the matters to the Commissioner (Appeals) for fresh adjudication on merits after affording opportunity of hearing and passing a speaking order.

Business Auxiliary Service - computer reservation system - incentives received from CRS for use of software - service tax leviability on commission/incentive - normal period of limitation - penalty not imposable where genuine confusion existed

Business Auxiliary Service - computer reservation system - incentives received from CRS for use of software - Amount received by travel agents from CRS/GDS companies for bookings made on their platforms is taxable as Business Auxiliary Service. - HELD THAT: - The Tribunal followed the reasoning in D-Pauls (and subsequent authority in Govan Travels) that CRS/GDS providers supply computers, software and a global booking platform to travel agents and, in return, pay incentives/commissions to agents for bookings effected through that platform. The service rendered by the travel agent in promoting and using the CRS for airline bookings falls within the definition of Business Auxiliary Service, and such receipts are not covered by the negative list or an exemption. Accordingly, service tax is leviable on such incentives/commissions under the BAS category.

Levy of service tax on incentives/commissions received from CRS/GDS companies upheld as taxable under Business Auxiliary Service.

Normal period of limitation - penalty not imposable where genuine confusion existed - Demand limited to the normal period of limitation and penalty waived in view of the prior uncertainty; computation remanded to adjudicating authority. - HELD THAT: - The Tribunal recognised that there was bona fide uncertainty and conflicting precedents concerning levy of service tax on CRS-related incentives during the relevant period, a confusion later addressed by a circular dated 29.02.2016. In light of that uncertainty, the Tribunal held that extended period of limitation should not be invoked and penalty should not be imposed. The matter of quantifying and computing the demand confined to the normal limitation period was remitted to the adjudicating authority for determination.

Demand restricted to the normal period of limitation, no penalty imposed; matter remanded for computation/ascertainment of the demand for the normal period.

Final Conclusion: Appeals allowed in part: service tax leviable on incentives from CRS/GDS as Business Auxiliary Service; however, demands confined to the normal limitation period and no penalty imposed; matters remanded to the adjudicating authority for computation of the demand for the normal period.

Construction Service for Personal Use - Liability of Service Provider where Service Receiver Contractually Liable - Time-bar and Extended Limitation for Service Tax Demands - Penalties for Failure to Discharge Service Tax - Relief where bona fide belief/no suppression

Construction Service for Personal Use - Demand of service tax in respect of construction of residential and commercial complexes for allotment on lease/licence to slum dwellers - HELD THAT: - The Tribunal applied its earlier decision in B.L. Mehta Construction Pvt. Limited (cited in the order) and, by reference to the reasoning in Khurana Engineering Ltd., held that where housing units are allotted on lease/licence and not sold, the construction activity constitutes service for personal use and does not attract service tax liability. The Tribunal found the precedent directly applicable to the facts of the appellant's contract with the Chandigarh Housing Board and concluded that the demand of service tax confirmed by the adjudicating authority is not sustainable. [Paras 3]

Demand of service tax set aside and not sustainable

Penalties for Failure to Discharge Service Tax - Relief where bona fide belief/no suppression - Liability of Service Provider where Service Receiver Contractually Liable - Time-bar and Extended Limitation for Service Tax Demands - Sustainability of interest and penalties imposed under the Finance Act (Sections 77 and 78 as recorded) and invocation of extended limitation - HELD THAT: - Relying on the Tribunal's earlier reasoning in Khurana Engineering Ltd., the Tribunal accepted the alternative submissions that the appellant entertained a reasonable belief that the services provided to a public/quasi-governmental receiver would not attract service tax and that the contract shifted any tax liability to the service receiver. In those circumstances, invocation of extended limitation and imposition of penalties were not justified. Consequently, the penalties and related demand elements confirmed in the impugned order could not be sustained. [Paras 2, 3]

Penalties and related demand elements set aside as not sustainable

Final Conclusion: The impugned order confirming demand of service tax, interest and penalties is set aside; the appeal is allowed with consequential relief.

Taxability of discounts/commissions received by advertising agencies - receipt from non-client not includible in taxable service consideration - discounts not related to gross amounts received from service recipient

Taxability of discounts/commissions received by advertising agencies - receipt from non-client not includible in taxable service consideration - Discounts/commissions/incentives received by the advertising agency from Print Media are not taxable as part of the consideration for Advertisement Agency Service. - HELD THAT: - The Tribunal applied settled precedent holding that amounts received by an advertising agency from Print Media in the form of discounts, commissions or incentives cannot be treated as receipts from the client for provision of advertising services because Print Media are not clients of the advertising agency. Such discounts are not connected to the gross amounts received from the service recipient and therefore do not form part of taxable consideration for the service. Following the reasoning in the earlier authoritative decision relied upon, the impugned demand based on treating those media discounts as taxable receipts was found unsustainable.

Impugned order confirming demand set aside; appeal allowed with consequential relief.

Final Conclusion: The appeal is allowed: the demands based on treating Print Media discounts/commissions retained by the advertising agency as taxable consideration are quashed and the impugned orders are set aside, with consequential relief to the appellant.

Sale of rights and privilege of export - sale of goods - service tax applicability - precedential effect of Vikas Sales Corporation - followed Tribunal decision

Sale of rights and privilege of export - sale of goods - service tax applicability - precedential effect of Vikas Sales Corporation - followed Tribunal decision - Transaction relating to sale of rights and privilege of export of sugar is a sale of goods and not a taxable service. - HELD THAT: - The Tribunal applied the Supreme Court ruling in Vikas Sales Corporation, as affirmed in subsequent authorities and followed in the Tribunal's decision in CCE&ST, Meerut-I vs. M/s Bajaj Hindustan Sugar Limited, to the facts of the present appeal. Both parties conceded that the legal question is identical to that decided in Bajaj Hindustan. Relying on that precedent, the Tribunal held that the transfer of export quota rights constitutes a transfer of goods and does not constitute rendering of any service liable to service tax. On that basis the impugned order demanding service tax was set aside and the appeal allowed with consequential relief to the appellant.

Impugned order set aside; appeal allowed as the sale of export rights is a sale of goods and not a service.

Final Conclusion: The appeal is allowed by applying the Supreme Court precedent and the Tribunal's earlier decision in Bajaj Hindustan, holding that sale of export rights in sugar is sale of goods and not subject to service tax; impugned order set aside with consequential relief.

Restoration of appeal - sufficient cause for non-appearance - ex parte disposal - interest of justice

Restoration of appeal - sufficient cause for non-appearance - ex parte disposal - interest of justice - Whether the ex parte disposal of the appeal could be set aside and the appeal restored on the ground of sufficient cause for non-appearance. - HELD THAT: - The Tribunal found that the appellant's non-appearance was caused by intervening events beyond their control: the partner who handled tax matters died, the counsel previously appearing had ceased practice and left Mumbai, and notices were received by the widow who could not inform surviving partners in time. The Tribunal noted the procedural history of transfers and multiple adjournments before the Division Bench culminating in ex parte disposal on 30.5.2017. Having considered the explanation and the circumstances surrounding service and representation, the Tribunal was satisfied that the appellant had been prevented by sufficient cause from appearing and that, in the interest of justice, the ex parte order should be set aside and the appeal restored for final hearing. The Tribunal declined to accept the respondent's objection and precedent reliance as determinative in light of the facts before it, and fixed the restored appeal for final hearing while directing that no adjournment be sought on the listed date. [Paras 5, 6]

Application for restoration allowed; ex parte order set aside and appeal restored for final hearing (fixed for 23.1.2018) with direction that no adjournment shall be sought.

Final Conclusion: The Tribunal allowed the miscellaneous application, holding that sufficient cause existed for non-appearance and restoring the appeal for final hearing while directing no adjournment on the listed date.

Restoration of appeal - modification of stay order - pre-deposit requirement under Section 35F of the Central Excise Act, 1944 - waiver of pre-deposit - out-of-turn hearing - sufficiency of deposit for maintaining stay

Modification of stay order - pre-deposit requirement under Section 35F of the Central Excise Act, 1944 - sufficiency of deposit for maintaining stay - Modification of the Tribunal's earlier stay order by altering the deposit required for continuation of stay. - HELD THAT: - The Tribunal, having regard to the amendment in Section 35F of the Central Excise Act, 1944 effective 6 August 2014 and the fact that the appellant M/s Gayatri Gramin Vikas Seva Sangh had already deposited 20% of the duty in dispute, concluded that the earlier stay order dated 27.01.2014 should be modified. On this basis the Tribunal fixed the deposit required for stay at Rs. 50,00,000/-, noting that this amount had already been deposited by the appellants during the course of investigation. The modification was therefore directed as a measure consistent with the amended pre-deposit regime and the existing payments made by the appellant. [Paras 4]

Earlier stay order modified and the deposit for stay fixed at Rs. 50,00,000/-, which was held to be already deposited.

Restoration of appeal - waiver of pre-deposit - Restoration of the dismissed appeals and waiver of the pre-deposit amount imposed on the second appellant. - HELD THAT: - The Tribunal considered the applicants' plea for restoration of their appeals (previously dismissed for non-compliance of the pre-deposit order) and, in the facts and circumstances, ordered restoration to the original appeal numbers. With respect to the second appellant, Shri Bipin G. Joshi, the Tribunal exercised its discretion to waive the deposit of Rs. 1 lakh which had been imposed. The conclusion to restore the appeals and to waive the specified deposit was recorded as appropriate in light of the parties' circumstances and prior payments. [Paras 4]

Appeals restored to their original numbers and the Rs. 1 lakh deposit imposed on the second appellant waived.

Out-of-turn hearing - Grant of out-of-turn final hearing for the restored appeals. - HELD THAT: - The Tribunal noted that the appellants' factory was reported to have been closed since 2014-15 and, considering the circumstances, directed that the appeals be heard out of turn. A specific date for final hearing was fixed accordingly. [Paras 4]

Out-of-turn hearing granted and final hearing fixed for 27th February, 2018.

Final Conclusion: The Tribunal modified its earlier stay by fixing the deposit for stay at Rs. 50,00,000/- (already deposited), waived the Rs. 1 lakh deposit for the second appellant, restored the appeals to their original numbers, granted out-of-turn final hearing and fixed the hearing for 27th February, 2018; the miscellaneous applications were disposed of.

Penalty under Rule 13(2) of the CENVAT Credit Rules, 2002 - penalty under Section 11AC - parimateria - rectification of mistake / review application - requirement of mala fide for sustaining penalty

Penalty under Rule 13(2) of the CENVAT Credit Rules, 2002 - penalty under Section 11AC - parimateria - rectification of mistake / review application - Whether the Tribunal committed an apparent error by referring to Section 11AC while the Adjudicating Authority had imposed penalty under Rule 13 of the CENVAT Credit Rules, 2002 and whether the Revenue's application for rectification/review is maintainable on that ground. - HELD THAT: - The Tribunal noted that the Adjudicating Authority's order (para 17) expressly imposed penalty under Rule 13(2) and Section 11AC, and that Rule 13(2) and Section 11AC are pari materia. The operating part of the Adjudicating Authority's order mentioned penalty under Rule 13 without specifiying the sub rule, while para 17 clarified that Rule 13(2) and Section 11AC were the provisions relied upon. Because the provisions are pari materia and the adjudicatory reasoning referred to both, the Tribunal's reference to Section 11AC in setting aside the penalty did not constitute an error apparent on the face of the record. On that basis the Tribunal found no merit in the Revenue's contention that a rectification was required simply because Rule 13 was not explicitly quoted in the Tribunal's operative recital. [Paras 17]

The Tribunal's mention of Section 11AC in place of an explicit citation to Rule 13(2) is not an apparent error and does not justify rectification; the review/rectification application on that ground is dismissed.

Requirement of mala fide for sustaining penalty - penalty under Rule 13(2) of the CENVAT Credit Rules, 2002 - penalty under Section 11AC - Whether the penalty imposed on the respondent was sustainable in view of the Tribunal's findings on culpability. - HELD THAT: - The Tribunal examined its detailed findings which set aside the demand on extended period and concluded that no mala fide on the part of the respondent had been established. Even accepting that the Adjudicating Authority imposed penalty under Rule 13 (and that the Tribunal referred to Section 11AC), the absence of malafide or requisite culpability meant that the penalty could not be sustained. Consequently, on either conception-whether under Rule 13(2) or Section 11AC-the penalty was liable to be set aside in light of the Tribunal's factual and legal conclusions. [Paras 17]

Penalty is not sustainable given the Tribunal's findings of no mala fide; therefore the penalty is liable to be set aside.

Final Conclusion: The Revenue's application for rectification/review is dismissed; the Tribunal's order setting aside the penalty stands because (i) the reference to Section 11AC did not amount to an apparent error given the pari materia nature of the provisions and the Adjudicating Authority's own finding, and (ii) on the merits the penalty could not be sustained in the absence of mala fide.

Extension of stay - continuance of stay orders passed by the Tribunal - tribunal's powers under section 35C of the CEA, 1944

Extension of stay - continuance of stay orders passed by the Tribunal - tribunal's powers under section 35C of the CEA, 1944 - Stay orders of the Tribunal which were in force beyond 07.08.2014 continue until disposal of the appeals and no further application for extension of stay is required. - HELD THAT: - The Tribunal relied on its prior decision in M/s. Venketeshwara Filaments Pvt. Ltd. & Ors. Vs. C.C.E. & S.T., Vapi-2014-TIOL-2388-CESTAT-AHM, holding that the omission of the provisos to section 35C(2A) removed any statutory provision for making further applications for extension of stay and for the Tribunal to hear such extension applications. That decision further held that this omission does not cause an initial stay order to lapse; rather, a stay granted and in force beyond 07.08.2014 remains effective until the appeal is finally disposed of. Applying that principle to the present matter, since the stay was in force beyond 07.08.2014, it continues to operate until disposal of the appeal and there is no requirement to file further applications for extension of the stay. [Paras 3, 4]

Application for extension of stay disposed of on the basis that the existing stay continues until disposal of the appeal.

Final Conclusion: The application for extension of stay is disposed of, the stay already in force beyond 07.08.2014 continuing until the appeal is finally disposed.

Denial of CENVAT credit based on oral statements of suppliers/dealers without effective cross-examination - Compliance with Section 9D of the Central Excise Act, 1944 before relying upon statements - Principles of natural justice and right to cross-examination - Remand for fresh adjudication to permit cross-examination and reconsideration

Denial of CENVAT credit based on oral statements of suppliers/dealers without effective cross-examination - Compliance with Section 9D of the Central Excise Act, 1944 before relying upon statements - Principles of natural justice and right to cross-examination - Whether the adjudication rejecting CENVAT credit on the basis of supplier/dealer statements, in respect of which cross-examination was not effectively conducted, can be sustained without complying with the procedure under Section 9D and principles of natural justice. - HELD THAT: - The Tribunal found that reliance was placed by Revenue on statements of suppliers and dealers where cross-examination had not effectively taken place. The Bench held that the procedure mandated by Section 9D of the Central Excise Act, 1944 and the law laid down by the Hon'ble Punjab & Haryana High Court in the cited decisions must be scrupulously followed before any adverse conclusion is drawn from such statements. Given the challenge raised about non-availability of cross-examination and the settled legal position requiring adherence to Section 9D and natural justice, the Tribunal concluded that the matter required re-examination by the adjudicating authority. Accordingly, the impugned order was set aside and the matter was remitted to the adjudicating authority with directions to afford an opportunity for cross-examination, to follow the procedure under Section 9D, and to reconsider and decide the issue afresh in accordance with the applicable judicial precedents and principles of natural justice.

Impugned order set aside; matter remitted to the adjudicating authority to allow cross-examination, comply with Section 9D and principles of natural justice, and to reconsider and decide afresh.

Final Conclusion: The appeals are disposed by setting aside the impugned order and remitting the matters to the adjudicating authority for fresh adjudication after permitting cross-examination and following Section 9D and the applicable principles of natural justice.

Confiscation under Rule 25 of the Central Excise Rules, 2002 - penalty for contravention of movement and documentation requirements under Rule 10 of the Central Excise Rules, 2002 - requirement to maintain challans and records for movement and receipt of goods - no inference of intention to evade duty from mere non-compliance with procedural formalities in absence of other evidence

Confiscation under Rule 25 of the Central Excise Rules, 2002 - no inference of intention to evade duty from mere non-compliance with procedural formalities in absence of other evidence - Whether confiscation of the excess stock of transformers found in the appellant's premises was justified. - HELD THAT: - The Tribunal found that 306 transformers were indisputably present at the appellant's premises but the appellant explained that 242 transformers had been received for testing and 64 were manufactured on job-work basis and kept outside the factory for want of space. The transformers bore serial numbers, identification plates and customer names and were ultimately meant for supply to Government electricity undertakings after testing. In the absence of any other evidence indicating an intention to clear the goods without payment of duty, mere non compliance with the procedural requirements of Rule 10 (such as not preparing challans at the time) does not warrant the harsh consequence of confiscation under Rule 25. Applying these findings, the Tribunal set aside the confiscation direction.

Confiscation of the excess transformers set aside.

Penalty for contravention of movement and documentation requirements under Rule 10 of the Central Excise Rules, 2002 - requirement to maintain challans and records for movement and receipt of goods - Whether penalty for violation of Rule 10 for failure to maintain and follow movement formalities is sustainable and, if so, quantum of penalty. - HELD THAT: - The Tribunal accepted that the appellants had not complied with Rule 10 formalities: challans were not prepared and prescribed records of movement and receipt were not maintained at the recipient's end. Such non compliance permits imposition of penalty. However, having considered the surrounding facts that the goods were identifiable, bore serial numbers and were intended for testing and onward clearance to government undertakings, the Tribunal exercised its discretion to moderate the penalty. The adjudicating authority's penalty was therefore sustained in principle but reduced in amount in view of the overall circumstances.

Penalty sustained but reduced to a moderated amount.

Final Conclusion: The appeal is partly allowed: confiscation of the excess transformers is set aside, while the imposition of penalty for breach of movement/record formalities is sustained but reduced in the exercise of discretion.

Interest on delayed refund - liability to pay interest under Section 11BB of the Central Excise Act - automatic accrual of interest where refund is sanctioned beyond three months - commencement of interest from expiry of three months from date of receipt of refund application - claim for interest not being a pre-condition for payment - CBEC Circular No.670/61/2002-CE - administrative directions on delayed refunds

Interest on delayed refund - claim for interest not being a pre-condition for payment - CBEC Circular No.670/61/2002-CE - administrative directions on delayed refunds - Appellant entitled to interest on sanctioned refund even though no separate claim for interest was filed. - HELD THAT: - The Tribunal accepted the Board's Circular No.670/61/2002-CE which states that where a refund is sanctioned beyond three months from the date of filing the claim, interest under the statutory provision flows automatically and the jurisdictional officers are not to await instructions or a separate claim. The Court held that there was no requirement for the appellant to file a separate claim for interest; entitlement to interest arises by operation of law when the refund is sanctioned after the three-month period. The impugned order rejecting the interest claim as not maintainable was therefore set aside. [Paras 5]

Interest is payable notwithstanding absence of a specific claim; the order rejecting the interest claim is set aside.

Liability to pay interest under Section 11BB of the Central Excise Act - commencement of interest from expiry of three months from date of receipt of refund application - Ranbaxy Laboratories Limited - applicability of commencement rule - Interest accrues from the date of expiry of three months from the date of receipt of the refund application and continues until realisation. - HELD THAT: - Relying on the Apex Court's decision in Ranbaxy Laboratories Limited, the Tribunal held that the revenue's liability to pay interest under the statutory provision begins upon expiry of three months from receipt of the refund application and not from the date of the order granting refund. Applying that principle, the appellant is entitled to interest from three months after the filing of each refund application until actual payment. [Paras 5]

Interest is payable from three months after the date of receipt of the refund application until realisation.

Final Conclusion: Appeal allowed; impugned order rejecting the interest claim set aside and appellant entitled to interest on the sanctioned refunds for the stated periods from three months after the date of the respective refund applications until realisation, with consequential relief.

Inclusion of outward freight in assessable value - application of Rule 6(3)(b) of Cenvat Credit Rules, 2004 - exclusion of transportation and installation/commissioning charges from value for Central Excise purposes - precedential effect of Tribunal decision - reliance on cost accountant's certificate as evidentiary basis

Inclusion of outward freight in assessable value - application of Rule 6(3)(b) of Cenvat Credit Rules, 2004 - exclusion of transportation and installation/commissioning charges from value for Central Excise purposes - reliance on cost accountant's certificate as evidentiary basis - Whether outward freight from the factory gate to the customer's premises must be included in the "total price" for computing the 8% remittance under Rule 6(3)(b) of the Cenvat Credit Rules, 2004 for exempted clearances. - HELD THAT: - The Tribunal held, following its earlier decision in Koya & Co. Construction Pvt. Ltd. v. CCE, that transportation and costs of jointing, laying and commissioning are not includible in the value for Central Excise duty purposes. Rule 6(3)(b) permits exclusion only of sales tax and similar taxes from the "total price", but the expression "total price" for the purpose of that Rule must be understood in a manner consistent with valuation under Central Excise law. Since transportation and installation/commissioning costs are excluded while determining assessable value under Section 4 principles, there is no basis to include those costs for computing the 8% payment under Rule 6(3)(b). The presence of a cost accountant's certificate before the original authority giving a bifurcation of such costs further supported treating these items as excludible. Consequently, charging 8% on transportation and related commissioning costs was held unjustified.

Outward freight and costs of jointing/laying/commissioning are not includible in the "total price" for computation of the 8% remittance under Rule 6(3)(b), and the impugned order demanding such amount is set aside.

Final Conclusion: Appeal allowed; impugned order set aside in view of precedential Tribunal decision that transportation and installation/commissioning costs are excluded from value for the purpose of Rule 6(3)(b) of the Cenvat Credit Rules, 2004 for the period December, 2002 to July, 2005.

Cenvat credit - input service - negative list - Rule 2(l) of Cenvat Credit Rules, 2004 - Rule 3 of Cenvat Credit Rules, 2004 - service tax paid by service provider

Cenvat credit - Rule 3 of Cenvat Credit Rules, 2004 - service tax paid by service provider - Entitlement to Cenvat credit where the underlying service is held to be in the negative list but service tax has in fact been paid by the provider and not disputed by the Revenue - HELD THAT: - The tribunal found as a fact that the appellant received the service and that service tax was paid on that service. Under the statutory scheme, Rule 3 of the Cenvat Credit Rules, 2004 permits availment of Cenvat credit where service tax has been paid on input services. Because the payment of service tax on the service in question by the provider was not disputed by the Revenue, the appellant was entitled to take Cenvat credit. The tribunal rejected the contention that classification of the service as falling within the negative list, by itself, disentitles the recipient to credit where tax has been paid and not impugned by the authorities.

Cenvat credit rightly availed by the appellant; denial of credit on this ground set aside.

Input service - Rule 2(l) of Cenvat Credit Rules, 2004 - Whether the service in question was an input service as contemplated by Rule 2(l) of the Cenvat Credit Rules, 2004 - HELD THAT: - The adjudicating authority did not record any adverse finding on the question whether the service qualified as an input service under Rule 2(l). The tribunal treated the absence of such a finding as effectively favourable to the appellant and noted that the Revenue has not challenged that aspect of the order. Consequently, the point was not in dispute before the tribunal and stood resolved in the appellant's favour.

Service treated as an input service for purposes of Cenvat credit; this issue not contested by the Revenue before the tribunal.

Final Conclusion: The impugned order denying Cenvat credit is set aside and the appeal is allowed; the appellant is entitled to Cenvat credit on the service in respect of which service tax was paid and which was not disputed by the Revenue, with consequential relief if any.

Valuation of physician samples - valuation under Section 4(1)(b) versus valuation under Section 4A - manufacture versus job-work distinction in valuation - application of precedent requiring separate assessment - remand for fresh and separate valuation with opportunity of hearing - admission of fresh evidence as per law

Valuation of physician samples - manufacture versus job-work distinction in valuation - application of precedent requiring separate assessment - Whether the valuation of physician samples must be determined separately for medicines manufactured by the appellant and for medicines manufactured by a job-worker, in accordance with the Tribunal's ratio. - HELD THAT: - The Tribunal's approach requires separate valuation where an assessee both manufactures goods itself and obtains goods on job-work basis. The appellate order did not apply the said principle by making distinct assessments for physician samples of medicines produced by the appellant and those produced by the job-worker, as required by the precedent cited. In view of the absence of separate valuation and assessment applying that ratio, the impugned order cannot stand. The matter is therefore set aside and remitted to the original authority to determine valuation separately for (a) physician samples of medicines manufactured by the appellant and (b) physician samples of medicines manufactured by the job-worker, while observing principles of natural justice. The remand permits reception of fresh evidence in accordance with law and requires the authority to afford a reasonable opportunity of hearing to the appellant before concluding the separate valuations. [Paras 3, 4]

Impugned order set aside; matter remanded to the original authority for fresh, separate valuation of physician samples (own manufacture and job-work manufacture) with reasonable opportunity of hearing and admission of fresh evidence as per law.

Final Conclusion: The appeal is allowed by remand: the matter is sent back for separate valuation of physician samples manufactured by the appellant and those manufactured by a job-worker, with opportunity of hearing and provision to admit fresh evidence in accordance with law.

Penalty not leviable where duty paid before issuance of show cause notice - payment of duty precludes imposition of penalty - reliance on settled precedents for exemption from penalty

Penalty not leviable where duty paid before issuance of show cause notice - payment of duty precludes imposition of penalty - Whether penalty could be imposed when the entire duty was paid prior to issuance of the show cause notice. - HELD THAT: - The Tribunal found on the record that the entire duty was paid before issuance of the show cause notice. Applying the settled legal position as laid down in the cited precedents, the Tribunal held that penalty is not leviable in such circumstances. Consequently the Tribunal modified the impugned order by cancelling the penalty while leaving the remaining portions of the order intact. [Paras 3, 4]

Penalty cancelled as duty was paid prior to issuance of the show cause notice; remaining order upheld.

Final Conclusion: Appeal partly allowed: penalty imposed in the impugned order set aside because duty was paid before issuance of the show cause notice; other aspects of the order are maintained.

Applicability of Rule 8 and Rule 9 of the Valuation Rules in related party clearances requiring 100% clearance - undervaluation in related party transactions - consequence of not pressing appeal against demand for captive consumption

Applicability of Rule 8 and Rule 9 of the Valuation Rules in related party clearances requiring 100% clearance - undervaluation in related party transactions - Whether the charge of undervaluation in respect of clearances to M/s ELMI is sustainable by applying Rule 8 and Rule 9 when the assessee did not clear 100% of its production to a related person. - HELD THAT: - The Tribunal applied the principle, as followed in JMP Castings Ltd, that Rule 8 read with Rule 9 is attracted only where the appellant clears 100% of production through a related person. The admitted fact in this case is that the assessee did not clear 100% of its production to M/s ELMI; supplies were also made to other parties. Given that factual position, the special valuation mechanism under the said rules cannot be invoked to sustain a charge of undervaluation. The Tribunal therefore found no justification to uphold the demand made in respect of clearances to M/s ELMI and set aside the impugned order as to that demand.

Impugned order insofar as it sustains demand against the assessee in respect of M/s ELMI is set aside; the charge of undervaluation is not sustainable.

Consequence of not pressing appeal against demand for captive consumption - Disposition of the demand relating to captive consumption which the assessee did not press in its appeal. - HELD THAT: - The assessee's counsel expressly informed the Tribunal that the appeal is not being pressed against the demand relating to captive consumption. On that basis the Tribunal recorded that the demand relating to captive consumption mentioned in paragraph 20 of the impugned order is accepted (i.e., the appeal is not pursued against that demand). The Tribunal's recording reflects that the assessee did not challenge that portion of the order before it.

Demand relating to captive consumption, as noted in paragraph 20 of the impugned order, stands (the appeal against that demand was not pressed).

Final Conclusion: Appeal by the assessee allowed insofar as the demand relating to clearances to M/s ELMI (undervaluation under Rule 8/9) is set aside; the appeal is not pursued against the demand for captive consumption which therefore stands; cross appeal by the Department is dismissed.

Treatment of miscellaneous income in assessable value - inclusion of compensation for defective supply in assessable value - reversal of credit where income forms part of assessable value

Treatment of miscellaneous income in assessable value - Miscellaneous receipts such as sale of scrap, sale of old drums and furniture, and customer advances outstanding in the balance sheet are not to be added to the value of final products. - HELD THAT: - The Tribunal found that the amounts characterised as miscellaneous income were adhoc receipts generated from disposal of scrap and sale of old items, and that advances from customers which remained outstanding in the balance sheet during the period under consideration do not form part of the value of goods manufactured. Such receipts were not regular proceeds attributable to manufacture and therefore could not be added to the assessable value of finished products. [Paras 4]

Miscellaneous income and outstanding advances held not includible in the value of final products.

Inclusion of compensation for defective supply in assessable value - reversal of credit where income forms part of assessable value - Compensation received by the appellant for supplying inferior quality ink is exigible and must be added to the value of goods, and the corresponding credit must be reversed. - HELD THAT: - The Tribunal upheld the adjudicating authority's conclusion that the compensation was not an adhoc or incidental receipt but arose from a regular activity and constituted income of the appellant connected with its manufacture/transactions. Consequently, that amount falls within the value of goods and the Commissioner was justified in directing reversal of the credit attributable to that amount. [Paras 5]

Compensation for supplying inferior ink held includible in value and subject to reversal of credit.

Final Conclusion: The impugned order is sustained; both appeals are dismissed - miscellaneous receipts not includible in assessable value while compensation for defective supply is includible and requires reversal of credit.

Sale without consideration - transaction with fictitious firm - duty demand on supply to non-genuine buyer - penalty for contravention - 100% EOU export obligation - suspension and revocation of licence

Sale without consideration - transaction with fictitious firm - duty demand on supply to non-genuine buyer - penalty for contravention - Validity of demand of duty and levy of penalty where the assessee, a 100% EOU, sold consignments to a buyer later found to be a fictitious firm and no consideration was received or recovered. - HELD THAT: - The Tribunal found on record that the appellant, though a 100% EOU, effected sales of three consignments to M/s Panorama Enterprises but received no payment and made no effort to recover any consideration. On departmental enquiry it was established that M/s Panorama Enterprises was a fictitious firm whose advance licence was suspended and subsequently revoked. In those circumstances the Tribunal agreed with the findings in the impugned order that the transactions were not genuine and that the department was therefore entitled to demand duty and to impose penalty. The appellate challenge to those conclusions was rejected for the reasons recorded in the impugned order. [Paras 5]

Impugned order upholding demand of duty and levy of penalty is affirmed and the appeals are dismissed.

Final Conclusion: The appeal is dismissed; the Tribunal affirms the demand of duty and penalty as the sales were to a non-genuine buyer (a fictitious firm) and no consideration was received or recovered.

Payment of duty with interest prior to issuance of show cause notice disentitling levy of penalty - penalty under Section 11AC for duty default - cancellation of penalty where demand discharged before show cause notice

Payment of duty with interest prior to issuance of show cause notice disentitling levy of penalty - penalty under Section 11AC for duty default - Levy of penalty under Section 11AC where the entire duty with interest was paid before issuance of the show cause notice. - HELD THAT: - The appeal was not contested on merits; the sole question addressed was whether penalty could be levied when the entire duty demand together with interest had been deposited before the show cause notice was issued. Applying the settled ratio in the authorities cited by the Tribunal, the Court held that where duty (with interest) is paid prior to the issuance of the show cause notice, penalty under Section 11AC is not leviable. On that legal foundation the Tribunal modified the impugned order and cancelled the levy of penalty while upholding the remaining portions of the order. [Paras 2, 3, 4]

Penalty levied under Section 11AC cancelled because duty with interest was deposited before issuance of the show cause notice.

Final Conclusion: Appeal partly allowed: the levy of penalty is set aside; the remainder of the adjudication is affirmed.

Penalty for delayed deposit of tax - Reasonable cause for delay - Discretionary imposition of penalty - Interest as compensation for delayed payment - Strict construction of taxing statutes

Penalty for delayed deposit of tax - Reasonable cause for delay - Discretionary imposition of penalty - Interest as compensation for delayed payment - Imposition of penalty under section 54(1)(1) of the U.P. VAT Act for a two day delay in deposit of admitted tax where reasonable cause was shown and interest was paid. - HELD THAT: - The Court found the factual position undisputed: admitted tax for November, 2009 was due on 20.12.2009; the assessee had no liquid funds on that date; the assessing authority granted an extension to 24.12.2009 on the assessee's justification; the tax was ultimately deposited on 26.12.2009 together with interest. The statutory provision permits levy of 20% penalty only where the dealer has "without reasonable cause" failed to deposit the tax, thus conferring a discretion on the authority to consider explanations. The authority had accepted the assessee's lack of liquid funds by granting an initial extension, and that very explanation constituted a reasonable cause which was not properly disregarded merely because payment was further delayed by two days. Overdraft facilities, though available in general, are subject to bank conditions and cannot be treated as an automatic ground to reject the assessee's explanation. Moreover, payment of interest compensates the State for the period of delay. Applying these considerations, the exercise of jurisdiction to levy the penalty in the circumstances was inappropriate and unsustainable. [Paras 9, 11, 12, 13]

Penalty imposed under section 54(1)(1) quashed; revision allowed.

Final Conclusion: The Court allowed the revision, quashing the 20% penalty for two days' delayed deposit of admitted tax for November, 2009, holding that the assessee had shown a reasonable cause and had paid interest, and that imposition of penalty in the circumstances was an improper exercise of discretion.

Recall of dismissal - restoration of proceedings - principle of raising issues before statutory fora / forum exhaustion - revisional jurisdiction under Section 9(2) of the Central Sales Tax Act, 1956 - validity of declarations in Form C - factual finding - perversity test

Recall of dismissal - restoration of proceedings - Application for recalling earlier dismissal and restoring the original file and number was allowed. - HELD THAT: - The Court examined the application to recall the order of dismissal of C.A.N.7071 of 2017 and found that the reasons set out in paragraph 4 of the recall application constituted sufficient cause. On that basis the earlier order dated 25 October 2017 was recalled and C.A.N.7071 of 2017 was ordered to be restored to its original file and number. The Court exercised its power to set aside the prior dismissal for sufficient cause shown and to reinstate the proceedings.

Order of dismissal recalled and C.A.N.7071 of 2017 restored to its original file and number.

Principle of raising issues before statutory fora / forum exhaustion - revisional jurisdiction under Section 9(2) of the Central Sales Tax Act, 1956 - validity of declarations in Form C - factual finding - perversity test - Whether the writ court should permit the appellant to raise, for the first time, a factual point about consignee details in sale bills underlying Form C declarations when that point was not raised before the appellate authority or was addressed by the revisional authority; and whether the revisional authority's finding that the sale bills showed 'Self' as consignee was vitiated. - HELD THAT: - The Court noted that the appellant did not appear before the appellate forum and that the point contended now (that consignee was not shown as 'Self' in all declarations) was not raised before the appellate authority. The First Court correctly applied the established principle that issues not raised before the statutory forum cannot be permitted to be raised for the first time in writ proceedings. Although the contention that the 'Self' entry arose before the revisional authority was pressed, the revisional authority had recorded a factual finding on that issue after calling for a report. There was no material to demonstrate that the revisional authority's factual finding was perverse. In the absence of perversity or other illegality in the revisional finding, the High Court declined to interfere with the conclusions reached by the statutory authorities regarding the impropriety of the declarations in Form C.

Writ petition dismissed; appellate and revisional findings upheld as not perverse; the new factual point could not be entertained in writ proceedings when not raised earlier.

Final Conclusion: The Court recalled the earlier dismissal and restored C.A.N.7071 of 2017; on merits it declined to interfere with the statutory authorities' findings regarding improper Form C declarations, refused to permit a fresh factual contention not raised below, and dismissed the appeal and the stay petition.

Meaning of "paid" and "tender" in land-acquisition statutes - deposit in Court versus deposit in Treasury/collector's account - consequence of non-deposit: interest under section 34 / section 80 - taking of possession by Panchnama / symbolic possession - deemed lapse under section 24(2) of the 2013 Act - revival of stale or barred claims - actus curiae neminem gravabit and principle of restitution - casus omissus and statutory interpretation of Section 24(2)

Meaning of "paid" and "tender" in land-acquisition statutes - deposit in Court versus deposit in Treasury/collector's account - consequence of non-deposit: interest under section 34 / section 80 - Whether the expression "paid"/"tender" in section 24(2) of the 2013 Act and section 31(1) of the 1894 Act includes deposit in Court under section 31(2), and whether non-deposit in Court results in lapse of acquisition. - HELD THAT: - The Court held that "paid"/"tender" and "deposited" are distinct expressions and carry different consequences. "Paid" for the purposes of section 24(2) means that the compensation has been tendered and made unconditionally available to the person entitled; a refusal to accept a lawful tender does not render the payment incomplete. Deposit in Court under section 31(2) is a separate contingency-triggered mode aimed primarily at preserving funds where disputes or incapacity to alienate exist and to avoid higher interest liability under section 34 (and its counterpart section 80 in the 2013 Act). State rules framed under Article 283/section 55 (authorising deposit in Treasury/revenue deposit and notice to beneficiaries) have long authorised deposit in the Treasury in cases where beneficiaries do not appear to receive payment. Such deposits are not invalid per se and do not automatically cause lapse of acquisition. The principal consequence of non-deposit in Court, where Court-deposit was the statutory contingency, is exposure to interest liability as prescribed (9% initially, rising to 15% after one year), not automatic divestment of the State's vesting in the land. The person who refused an unconditional tender cannot take advantage of that refusal to claim lapse of acquisition. The proviso to section 24(2) (which uses the expression "deposited in the account of the beneficiaries") addresses a different situation and must be given its proper field of operation; it does not mean that every deposit must be in Court to avoid lapse. For these reasons the Court declined to read "deposited in Court" into the word "paid" in section 24(2). [Paras 43, 62, 71, 76, 153]

The word "paid"/"tender" in section 24(2) means tender/making the amount unconditionally available; deposit in Court is not an indispensable element of "paid" for section 24(2). Non-deposit in Court does not by itself cause lapse of acquisition; at most it may attract interest under section 34/80.

Taking of possession by Panchnama / symbolic possession - deemed lapse under section 24(2) of the 2013 Act - What constitutes "physical possession" for the purposes of section 24(2) and whether Panchnama/symbolic acts can amount to possession. - HELD THAT: - The Court reaffirmed established precedents that there is no single rigid act which constitutes taking possession; the mode depends on the nature of the land. For vacant/open land a site inspection and preparation of Panchnama in the presence of witnesses is ordinarily sufficient to constitute taking possession. For land with standing crops or structures additional steps (notice to occupier, taking possession in presence of independent witnesses) may be required; yet even in case of refusal, possession may be deemed to have been taken. Where acquisition involves large tracts, symbolic possession via a duly executed Panchnama is an accepted and lawful mode. The Court emphasized that later re-entry or trespass by erstwhile owners does not negate previously taken possession. The decision in Velaxan Kumar to the extent it requires actual physical occupancy in every case is overruled; Banda Development Authority and the line of authorities recognising Panchnama/symbolic possession represent the correct law. [Paras 86, 87, 88, 89, 153]

Possession for the purposes of section 24(2) may be taken by preparation of a duly executed Panchnama or other symbolic mode appropriate to the nature and scale of the land; such symbolic possession suffices as "physical possession" in many cases.

Revival of stale or barred claims - deemed lapse under section 24(2) of the 2013 Act - Whether section 24 of the 2013 Act revives stale, dead or time-barred claims and permits reopening of acquisitions long finally adjudicated. - HELD THAT: - The Court held that section 24 is not intended to revive dead or stale claims or to unsettle rights which have been finally adjudicated. The 2013 Act is beneficial and aims to protect bona fide landowners who were not paid or dispossessed for reasons not attributable to them, but it was never intended to reopen concluded acquisitions, disturb vested rights, or permit revival of claims lost by earlier litigation or barred by laches. Where rights have been finally adjudicated, or the owner has accepted compensation, or earlier litigation has attained finality, section 24 does not give a licence to reassert stale claims. Courts must be alert to attempts to misuse section 24 to reopen concluded transactions; such fraudulent/stale claims are not to be entertained. Delay, laches and loss of evidence are material and may bar relief even if no express limitation is in the 2013 Act. [Paras 96, 98, 99, 100, 153]

Section 24 does not revive stale or time-barred claims; it does not entitle parties to reopen acquisitions which have attained finality or to reap benefit from dilatory tactics.

Actus curiae neminem gravabit and principle of restitution - casus omissus and statutory interpretation of Section 24(2) - Whether the period during which acquisition proceedings are stayed by court orders (interim or final) must be excluded while computing the five-year period in section 24(2), and whether the maxim actus curiae neminem gravabit (and allied equitable principles) apply. - HELD THAT: - The Court concluded that the period during which acquiring authorities were restrained by interim or final judicial orders, or otherwise disabled from acting through no fault of their own, must be excluded from the five-year computation under section 24(2). The principle that the act of the court should not prejudice parties (actus curiae neminem gravabit), together with the equitable doctrine of restitution, operates to neutralize any unfair advantage which litigants may obtain from interim orders; where an interim order restrained State action, the time so consumed should not be visited upon the State to cause lapse. Though the legislature omitted explicit exclusion language in section 24(2), other provisions of the Act and the broader statutory and equitable context justify supplying the omission in order to avoid absurd or unjust results; casus omissus may be supplied where necessary for harmony and to effectuate legislative purpose. The Court therefore held that exclusion of pendente lite periods is appropriate and that the common-law maxims and restitution principles are available to prevent litigants from benefiting from their own wrong or from the mere pendency of proceedings. [Paras 117, 128, 139, 140, 153]

The period during which authorities were restrained by court orders or otherwise disabled (through no fault of the authorities) is to be excluded when computing the five-year period under section 24(2); the maxim actus curiae neminem gravabit and restitution principles apply to prevent prejudice to the acquiring authority and to deny litigants benefit from their own dilatory conduct.

Final Conclusion: The Court answered the referred questions: (1) "Paid" / "tender" in section 24(2) means tender/making the amount unconditionally available; deposit in Court under section 31(2) is a separate contingency and non-deposit in Court does not automatically cause lapse of acquisition - at most statutory interest (section 34/80) may follow; treasury/collector-account deposits under valid State rules are not void. (2) Physical possession may be taken by Panchnama/symbolic acts appropriate to the nature and area; such modes suffice. (3) Section 24 does not revive stale or finally barred claims. (4) Periods during which authorities are disabled from acting by court orders (or equivalent) are to be excluded in computing the five-year period under section 24(2); the doctrine actus curiae neminem gravabit and restitution principles apply to prevent litigants benefiting from their own wrong. The referred questions are answered accordingly.