TaxTMI Updates e-Newsletter
Feb 16,2026

Jurisdiction of the Appellate Tribunal under the CGST / SGST Act - power to re-appreciate evidence in second appeals - discrepancy between return of outward supply declared in GSTR-1 and tax paid in GSTR-3B -Rule 112 of the CGST Rules - admission of additional evidence in appellate proceedings - conversion of proceedings from Section 74 to Section 73 - remand to the proper officer u/s 75(2) for re-determination - absence of fraud or wilful suppression u/s 74 -

Jurisdiction under Section 112 of the CGST Act - power to re-appreciate evidence in second appeals - HELD THAT:- The Supreme Court in the case of Hamida Vs. Md. Khalil [2001 (5) TMI 939 - SUPREME COURT] stated that it is well settled that while exercising jurisdiction under Section 100 of the Code, the High Court cannot reverse the findings of the lower appellate court on facts merely on the ground that on the facts found by the lower appellate court another view is possible.

We find Jurisdiction of the Appellate Tribunal under the CGST / SGST Act is different from the Jurisdiction of the High Court Under Section 100 of the Code. There is a need to compare the language used by two different Provisions. Section 100 of the Code provides the Second Appeal Jurisdiction in a Civil Matter and Section 112 of the CGST Act along with Rule 112 of the CGST Rules, 2017 provide for second appeals in GST matters.

No doubt in the mind of this tribunal that the limitations enshrined in the Section 100 of the Code are singularly absent in the appeal provisions in matters relating to GST under CGST Act as far jurisdiction of the Tribunal is concerned regarding second appeals. We may also note here that Section 117 and 118 of the CGST Acts provides for appeals to High Court and Supreme Court.

Thus, it is clear, the High Court as provided in Section 117 and Supreme Court as provide in Section 118 would be an Appellate Court to deal with the substantial question of law. Similar provision is found in Section 100 of the Code. Moreover, Sub-Section (2) of 111 of the CGST Act, 2017 further provides that the Appellate Tribunal, while discharging its functions, possesses the same powers as a civil court under the Code. Section 111(1) of the CGST Act, 2017 provides “that the Appellate Tribunal shall not, while disposing or proceeding before it or an appeal before it the bound by the procedure laid down in the Code of Civil Procedure, 1908”.

Thus, the argument advance by the Revenue that the Tribunal cannot go into the question of fact is not sustainable and it is held that in exercise of Jurisdiction under Section 112 read with Rule 112 has power to examine question of facts also and it is the last adjudicating forum on questions of facts.

Absence of fraud or wilful suppression under Section 74 - The first Appellate Authority while setting aside the penalty imposed by the Proper Officer under Section 74 of CGST Act came to the conclusion (as underlined above) that in the absence of establishment of any intention of the taxpayer to evade tax by way of fraud or suppressing the facts, as the appellant has disclosed the same in debit/credit notes, supported with invoices duly accounted for in books of accounts but did not disclose it in periodical returns matching with total liability in annual return correctly and could not prove the ITC passed by the appellant to the recipients are not utilised. Thus, First Appellate Court has accepted that the Appellant has disclosed the transaction in Debit / Credit notes and are supported with invoices duly accounted in books of Account. But his fault was that he did not disclose the transactions in the periodical returns matching with total liability in annual returns correctly. It also held that the LPO has not proved that the ITC passed by the Appellant to the Recipient were not utilized.

The only mistake which has been found with the Appellant is that he has not reflected the debit / credit notes which has been duly accounted in books of account in its periodical returns. And that he did not prove the ITC passed to the Recipients by the Appellant are utilized.

In this case we are of the opinion that this aspect has to be relooked into by the Learned Proper Officer and Appellant should be given chance to amend his returns by condoning his delay occasioned in the meantime. This view was discussed in course of virtual hearing and Learned Joint Commissioner was not in agreement with same, however, Learned Additional Standing Counsel would submit that such a case will become a precedent and may cause numerous cases to be remanded. We are of the view that every litigation has its own merits and demerit. It has to be decided on its own facts and merits. A cannot be decided on the basis consequences that follow with respect to other litigations.

Thus, it is clear that original Proper Officer who has issued Notice Under Section 74(1) of the CGST Act shall re-determine the tax payable by the Assessee and it cannot be done by the First Appellate Authority or the Tribunal. The natural corollary to such an observation would be that in case First Appellate Authority or the Tribunal comes to the conclusion that the proceeding initiated under Section 74 (1) of the CGST Act is not maintainable because of lack of requirements to attract the provision and comes to the conclusion that this is a matter to be considered under Section 73 of the CGST Act, then the matter has to be remitted back to the learned Proper Officer for re-determining the tax to be paid along with penalty, interest, etc.

There were chances of human error. In order to obviate any such human error, the matter should be re-considered by the learned Proper Officer. If we remand the matter, the best or the worst, depending upon the point of view, either from Revenue or from the side of the assessee, that can happen is that the case would be re-heard and decided at the very threshold and effective judgment would be passed. It is also not disputed at this stage that Appellant was not heard in-person at the time of passing of the order-in-original.

In the Result, that order passed by the learned Proper Officer and the order passed by the First Appellate Authority, so far as it relates to treating the case as Section 73 of the CGST/SGST Act are concerned, cannot be sustained and accordingly is set aside. However, we are not setting aside the orders passed by the learned Appellate Authority as far as its finding that case does not come under Section 74 of SGST / CGST Act.

The Appellant through its authorized Representative shall appear before the Proper Officer and file suitable application within a month. The case shall be re-considered as one under Section 73 of the CGST Act and after affording a reasonable opportunity of hearing, producing documents and seeking amendment (amendment must be filled withing 30 days from the publication of this judgment) shall be considered on merits by the learned proper officer. The learned Proper Officer while disposing the proceeding Under Section 73 of the CGST Act shall examine the genuineness of the Credit / Debit notes and other documents produced by the Appellant and render the final order.

There shall be no orders as to costs.

Pre-deposit - failure to make the prescribed 10% pre-deposit - restoration of appeal - opportunity to cure default - conditional restoration - HELD THAT:- The petitioner, consistent with the undertaking given by his counsel on instructions today before the Court, must comply with the requirement of pre-deposit within three weeks from the date of uploading of this order. If this requirement is complied with, the Appellate Authority shall proceed to dispose of the petitioner’s appeal in accordance with law on its own merits.

However, if the petitioner fails to comply with the requirement of pre-deposit within the timeline as indicated above, this writ petition shall be deemed to have been dismissed without further reference to the Court.

As a consequence, the Appellate Authority’s order dated 28.11.2025 shall remain undisturbed and its consequences shall follow.

This writ petition is disposed of in above terms without any order of costs.

Retrospective amendment permitting belated Input Tax Credit - Input Tax Credit entitlement for Financial Year 2017-2018 - Rectification application for availing retrospective benefit - Applicability of administrative circular prescribing limitation for rectification - Judicial mandamus to adjudicate rectification applications - HELD THAT:- The petitioner’s contention about Circular dated 15th October, 2024 or the period of limitation prescribed therein not being applicable to the petitioner’s case or generally not binding upon a taxpayer, given the statutory provisions, are specifically kept open, and the same may also be addressed by the 2nd respondent when disposing of the petitioner’s rectification application dated 11th December, 2025.

The 2nd respondent should afford the petitioner an opportunity of hearing and pass a reasoned order disposing of the aforesaid rectification application within a timeline now directed by us. All contentions of the parties, however, remain open for the decision of the 2nd respondent in the first instance.

If the petitioner is aggrieved by the 2nd respondent’s decision, the petitioner will be at liberty to challenge such a decision along with the impugned order-in-original, in accordance with law and the prescribed procedures.

This petition is disposed of in the above terms without any order for costs.

Service of affiliation - exemption for services by educational institutions - services relating to admission to, or conduct of examination by, such institution - interpretation of exemption notification No.12/2017 - clarificatory circular and GST Council recommendation - HELD THAT:- It is undoubtedly clear that the fees collected for affiliation and for inspection of colleges applied for affiliation, fall beyond the scope of service connected with admission of students and conduct of examination. The illustration given by the learned Single Judge in Madurai Kamaraj University's case [2024 (6) TMI 1550 - MADRAS HIGH COURT] that admission of students by affiliating college is controlled by universities while granting affiliation and if the affiliation is granted for admitting 100 students, the College cannot admit even one student more and therefore, the extended meaning should be given to the expression 'service in connection with admission of student', is fallacious. The number of students to be admitted in the affiliated college is determined by the statute namely, the University Act based on availability of necessary infrastructure, such as building, teaching faculty etc.. Admission of students commences only after the affiliation is granted on satisfaction of required infrastructure. Any service provided for granting affiliation is independent of admitting student and conduct of examination. Therefore, extended meaning to the expression 'admission of student or conduct of examination' is impermissible.

As a result, we hold that the view expressed in the subsequent judgment namely, Pondichery University's case [2023 (10) TMI 1169 - MADRAS HIGH COURT] declares the correct legal position, since the affiliation fee collected by the Universities does not fall within exemption. Accordingly, the fee collected by the University from the Colleges as affiliation fees is amenable for levy of GST. Thus the order of reference is answered accordingly. The matter is sent back to the learned Single Judge to decide the case on other grounds, if any.

Refund rejection - show cause notice - principles of natural justice - alternative remedy of appeal - condonation of delay - ultra vires challenge to administrative circular - Validity of the impugned refund rejection order in FORM-GST-RFD-06 dated 13.05.2025 - HELD THAT:- Petitioner has, instead of availing the remedy of appeal, now sought to question the refund rejection order by raising a ground of ultra vires of the circular dated 18.11.2019 itself which is applicable to processing of the refund claims.

However, the petitioner has bypassed the alternative remedy of appeal available under Section 107(1) of the CGST Act. The writ petition has been pending since its institution on 09.07.2025. Since we are inclined to relegate the petitioner to the appellate remedy, in case such an appeal is preferred within a period of two weeks with a delay condonation application, the appellate authority would take into account that the petitioner was pursuing its remedy for all this period before this Court in writ jurisdiction. Petitioner is at liberty to take all such grounds of fact and law before the appellate authority which may be considered, in accordance with law, within a reasonable time.

The instant Writ Petition is, accordingly, disposed of. It is made clear that we have not made any comments on the merits of the case of the parties.

GST on seigniorage / royalty fee - adjudication of show cause notice on merits - implementation of adjudication orders to be kept in abeyance pending higher forum decision - submission of objections/representations within a fixed time - no recovery of tax pending constitution bench / Supreme Court decision - deposit direction in assessment proceedings - HELD THAT:- This Court has heard several cases, wherein either the Show Cause Notices or Assessment orders were under challenge. In cases, where the assessments orders were under challenge, the petitioners were directed to deposit 10% of the disputed tax. However, in the present case, the petitioner resisted the same in the light of the above decision of the Hon’ble Division Bench of this Court, which is now the subject matter of challenge before the Hon’ble Supreme Court in UDAIPUR CHAMBERS OF COMMERCE AND INDUSTRY & ORS. VERSUS UNION OF INDIA & ORS. [2024 (8) TMI 254 - SC ORDER] batch, etc.

In view of the above decision of the Hon’ble Division Bench, the respondent is directed to adjudicate the Show Cause proceedings and keep the implementation of the impugned assessment order to be passed in abeyance, awaiting the decision of the Hon’ble Supreme Court.

This writ petition is disposed of with the above observations.

Violation of principles of natural justice - personal hearing - composite show cause notice for multiple tax periods - consolidated adjudication u/s 74 - Rule 142(1A) CGST - issuance of Form GST DRC-01A - prejudice test for non-compliance with procedural requirements - limitation u/s 74(10) of the CGST Act -HELD THAT:- Upon consideration of the stand of the parties, the following position emerges on the requirement of issuance of intimation under Rule 142(1A). Rule 142(1A) either before or after amendment did not use the expression ‘period’. The legislature consciously amended the expression ‘shall’ used in unamended Rule 142(1) as ‘may’. The Rule does not refer to the ‘period’ for which the intimation relates.

In the case of M/s. New Morning Star Travels [2023 (10) TMI 1246 - ANDHRA PRADESH HIGH COURT], it has been held that in a case where the interpretation of a statute leads to ambiguity, the benefit ought to go to the tax payer. The decision, however, does not address as to whether non-issuance of such intimation led to any prejudice, in the facts and circumstance of the case. A Constitution Bench of the apex court in ECIL vs. B. Karunakar [1993 (10) TMI 310 - SUPREME COURT], at para 30(v), has held that the theory of reasonable opportunity and the principles of natural justice have been evolved to uphold the rule of law and to assist the individual to vindicate his just rights. They are not incantations to be invoked nor rites to be performed on all and sundry occasions. Whether in fact, prejudice has been caused to the employee or not on account of the denial to him of the report, has to be considered on the facts and circumstances of each case.

A decision is passed sub silentio when the particular point of law in a decision is not perceived by the court or not present to its mind or is not consciously determined by the court and it does not form part of the ratio decidendi, it is not binding. (Also see paras 13, 13.1 to 13.8 of Odisha State Financial Corporation vs. Vigyan Chemical Industries [2025 (8) TMI 708 - SUPREME COURT]. In such a situation, the decision in the case of M/s. New Morning Star Travels (Supra), can be said to be rendered sub silentio as the test of prejudice was neither raised nor considered by the learned court. This court is therefore of the opinion that non-issuance of intimation in Form GST DRC-01A under amended Rule 142(1A) for the period prior to 15.10.2020 upon the petitioner did not result in causing any prejudice for the purposes of striking down the impugned order.

The petitioner has an efficacious alternative remedy of appeal to raise all available grounds of law and fact under Section 107(1) of the Act.

If, in the ultimate analysis, the petitioner could not show any prejudice for non-issuance of the intimation in Form GST DRC-01A, this Court could refrain from exercising its discretionary jurisdiction under Article 226 of the Constitution of India as it could only be a formality.

This court is of the considered opinion that the petitioner has not been able to make out a case for interference in the impugned show cause notice and the Order-in-Original on any of the grounds raised by it in writ jurisdiction. The petitioner may avail the remedy of statutory appeal taking all such grounds of law as available on facts. Needless to say, in such a case, the appellate authority would consider the explanation of the petitioner for delay, if any, in preferring the appeal taking into account that the petitioner was prosecuting his remedy before this court in the writ jurisdiction.

The writ petition stands dismissed.

Profiteering u/s 171 - Passing on benefit of input tax credit - Computation of profiteering and proportional adjustment for work completed - Acceptance of DGAP report and its evidentiary/conclusive effect - Liability to pay interest under Rule 133(3)(b) of the CGST Rules - HELD THAT:- We hold that the Respondent has profiteered by an amount of Rs. 12,20,694/- which needs to be passed on to M/s NTPC Ltd. And as the work of Rs. 97,66,48,456/- has been completed which is about 76.735% of the total work done as per Letter of Award dated 15.09.2016 for the said project in post GST period, accordingly, proportionate profiteering amount for the completed work calculated as Rs. 9,36,700/- is liable to be passed to the Applicant. Further as per Rule 133(3)(b) of the Central Goods and Services Tax Rules, 2017, the Respondent is liable to pay interest as applicable to Applicant. The Respondent shall pay the profiteered amount of Rs. 9,36,700/- to the Applicant along with applicable interest within 30 days and submit compliance report to the jurisdictional CGST/SGST Commissioner with intimation to the DGAP within 2 months.

The case is disposed of, accordingly.

Composite supply - supply of medicines, consumables, implants and medical items to in patients as part of hospital treatment -exemption under Entry No. 74 of Notification No. 12/2017 Central Tax (Rate) dated 28.06.2017 - applicability of a notification and determination of liability to pay tax on any goods or services -outpatient supplies not integral to composite healthcare - binding nature of advance ruling - advance ruling void ab initio if obtained by fraud or suppression - HELD THAT:- ‘Inpatient services’ means services provided by hospitals to inpatients under the direction of medical doctors aimed at curing, restoring and/or maintaining the health of a patient and the service comprises of medical, pharmaceutical and paramedical services, rehabilitation services, nursing services and laboratory and technical services till the patient gets discharged. A complete gamut of activities required for the well-being of a patient from admission till discharge, provided by a hospital under the direction of medical doctors is a composite supply of service and is covered under ‘Inpatient services’ classifiable under SAC 999311.

From a conjoint reading of the ‘Explanation of service’ pertaining to ‘Inpatient services’ and the clarification above, it is evident that the exemption is applicable to a “Clinical Establishment”, when services by way of diagnosis or treatment or care for illness, etc., are undertaken by such establishment under the directions of a medical doctor. The applicant hospital as in the instant case, is a ‘Clinical Establishment’ and it is clear that they are exempt under SI. No. 74 of Notification No. 12/2017-C.T.(Rate) dated 28.06.2017, in respect of the ‘Healthcare services’ provided by them in general.

We further note that Section 2(30) of CGST Act 2017, defines “Composite Supply” as a supply consisting of two or more taxable supplies of goods or services or both, or any combination thereof, which are naturally bundled and supplied in conjunction with each other in the ordinary course of business, one of which is a principal supply. In the instant case, taxable supplies such as medicines, consumables, implants, etc., provided to in-patients qualifies as a ‘composite supply’, since they are naturally bundled and are supplied in conjunction with the ‘Healthcare services’, which happen to be the principal supply. Therefore, supply of medicines and consumables including food to in-patients in the course of the treatment till the patient is discharged is a composite supply of health care services.

We take note of the fact that the applicant has discussed the issue relating to out-patients also in the same vein as that of the in-patients. In this regard, it is to be noted that while providing health care related services to out-patients, medicines and consumables which is of advisory nature, are prescribed by the Doctor who attends to the patient.

It is also to be noted here that the pharmacy attached to the hospital/clinical establishment is an outlet to dispense medicines and consumables based on prescriptions, but in the case of out-patients, the said patients are not mandated to procure them only from the pharmacy attached to the hospital, and they are at liberty to procure the same from the hospital or other pharmacies of their choice. Whereas, in the case of in-patients, medicines and consumables are necessarily issued by the hospital’s pharmacy to ensure proper and timely treatment, thereby becoming an integral part of the healthcare service provided together to the in-patients. Further, as already discussed, the clarification provided as in para 5(3) of the Circular No. 32/06/2018-GST, dated 12.02.2018, addresses the issue by clarifying that the food supplied to the in-patients as advised by the doctor/nutritionist is part of the composite supply of healthcare and not separately taxable, whereas the other supplies of food to patients who are not admitted are taxable. It therefore becomes evident that the same analogy applies to the instant case as far as it relates to dispensing of medicines, implants and consumables, etc., to out-patients also.

Accordingly, we are of the opinion that the supply of Medicines and consumables used in the course of providing health care services to out-patients visiting the hospital for diagnosis or medical treatment or follow up procedures cannot be considered to be an integral part of a composite supply involving supply of health care service, as they become different supplies independent of each other. Therefore except for the exempted healthcare service, all other supplies including medicines, implants, consumables, etc., in the case of supplies to out-patients are taxable to GST.

Conclusion -

Supply of medicines, consumables, implants and other medical items to In-patients as part of the treatment provided by the hospital is exempt under Entry No. 74 of the Notification No.12/2017-Central Tax (Rate) dated 28.06.2017, as a composite supply of healthcare services.

The Consultation service provided to out-patients is exempted under Entry No. 74 of Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017. However, the supply of medicines, consumables, implants and medical items to out-patients attract payment of GST.

Supply as outward supply in the course or furtherance of business - Value of taxable supply - transaction value - Valuation of second hand goods - margin scheme under Rule 32 - Notification No. 8/2018 - margin-based taxation of old and used vehicles - Input tax credit blockage on motor vehicles under the GST scheme - Binding nature of an Advance Ruling - HELD THAT:- The sale of used car is an outward supply of goods as the car is a movable property which is being sold for a consideration in the course of the applicant’s business. It is pertinent to note here that admittedly, the applicant had capitalised the car in their business account. Therefore, we are of the opinion that though the transaction effected by the applicant happens to be a single transaction, nevertheless it is a business transaction and therefore becomes taxable under GST, as the same gets covered under the concept of ‘Supply’ as per the provisions of GST. Hence, the applicant is liable to levy and collect tax on supply of such goods under Section 9 of the CGST Act, 2017, if the goods are sold in the course of intrastate supplies, and under Section 5 of the IGST Act, 2017, if the goods are sold in the course of interstate supplies.

We note that in the instant case, the applicant claims that they have neither taken input tax credit on the purchase of the new vehicle, nor availed any depreciation on the capitalisation of the said vehicle, and that therefore the main conditions stand satisfied. In this regard, we find that in any case, input tax credit of the taxes under GST paid on the inward supply of motor vehicles is blocked under Section 17(5)(a) of the CGST Act, 2017, except when they are used for making.

We find that the entire scheme of valuation based on margin applies to cases “Where a taxable supply is provided by a person dealing in buying and selling of second hand goods”. Whereas, in the instant case, we find that the applicant is neither dealing in ‘second hand goods’, or ‘Old and Used’ goods, nor, they deal in buying and selling of such goods in the normal course of business. Further, we find that though the applicant attempts to sell a ‘Used’ car, the same was reportedly purchased as a ‘New’ car originally, and therefore, the applicant is not dealing in ‘second hand goods’. Accordingly, the method/manner of valuation of supply representing the margin of the supplier, as laid down under Rule 32 of the CGST Rules, 2017, read with Notification No. 8/2018-Central Tax (Rate) dated 25.01.2018, is effectively ruled out in the instant case, and that the said option is not available to the applicant.

Once the said method of valuation stands ruled out, the applicant by default becomes liable to assessment based on the transaction value, i.e., the price actually paid or payable for the said supply of goods or services or both where the supplier and recipient of the supply are not related and the price is the sole consideration for the supply, as stipulated under Section 15(1) of the CGST Act, 2017. We, are therefore of the considered opinion that the provisions of Notification No. 8/2018-Central Tax (Rate) dated 25.01.2018, is not applicable in the instant case of the applicant and that they are liable to pay taxes under GST on the full value, i.e., consideration received by the applicant towards the sale of car.

The applicant’s proposed transaction of sale of used car is liable for tax under GST, as applicable and the tax is liable to be paid on the entire sale value of the used car by the applicant in the instant case, and not on the profit/margin.

Supply of services - Agreeing to the obligation to refrain from an act - Place of supply of services - Export of services - Zero-rated supply - Determination of liability to pay tax -

Place of supply of services - Determination of liability to pay tax - HELD THAT:- We find that the applicant is one of the shareholders of M/s. Smartpoint Technologies Pvt Ltd., engaged in the development of software to track the flow of goods. M/s. Smartpoint Technologies has been sold to M/s. RFXCEL Corporation, USA and M/s. Antares Vision India Pvt Ltd., the purchasers. The applicant has received non-compete fee of USD 2,67,321.60 from M/s. RFXCEL for refraining from competing with the business of M/s. Smartpoint Technologies Pvt Ltd., and business of the purchasers. We get to understand that both the purchasers are subsidiary of Antares Vision Group. One of the purchaser, M/s. RFXCEL Corporation has its business activity outside India.

As per Clause 5(e) of Schedule II of CGST Act, 2017, the activity of agreeing to the obligation to refrain from an act shall be treated as ‘Supply of Services’. In the instant application, the applicant has agreed to not do business or compete in the places where the purchasers and M/s. SmartPoint Technologies do business i.e., the applicant has agreed to ‘refrain from doing an act’. As such, the activity of the applicant agreeing not to do business amounts to a ‘Supply of Service’. As the activity of the applicant to refrain from performing an act falls under Supply of Service, same is taxable under GST as per Section 9(1) of CGST Act, 2017.

Supply of services - Agreeing to the obligation to refrain from an act - Export of services - Zero-rated supply - HELD THAT:- We find that the activity of the applicant involved in the instant case, i.e., not to compete with the business of the purchasers is a ‘supply of service; M/s. RFXCEL has its business operations outside India; the applicant is the supplier of service and is located in India; the recipient of service, viz., M/s. RFXCEL is located outside India ; as a result, the ‘place of supply’ of service is outside India; the non-compete fee of USD 2,67,321.60 is received (payment for such service) in foreign exchange; the applicant being the supplier of service and M/s. RFXCEL’s client being the recipient of service are not merely establishments of a distinct person in accordance with Explanation 1 in Section 8. Accordingly, the service rendered by the applicant of not competing with the business of Purchasers, namely, M/s. RFXCEL Corp satisfies all the 5 conditions as per Section 2(6) of IGST Act, 2017 and hence gets covered as “export of services”. As a result, the activity would be zero-rated supply, attracting ‘Nil’ rate of GST.

Accordingly, the applicant would become liable to pay taxes under GST, either as IGST under Section 5 of the IGST Act, 2017, or as CGST plus TNGST under Section 9 of the CGST/TNGST Acts, 2017, as the case may be.

Supply of services - Inter-State supply - Intra-State supply - HELD THAT:- As per the additional submissions given by the applicant and segregation of non-compete fee based on Domestic and Export supply, 98.57% of the non-compete fee received by the applicant would fall under export of services and attract zero-rated GST. The balance 1.43% of the non-compete fee received by the applicant would attract applicable GST as inter-state and/or intra-state supply.

Advance ruling under Section 95(a) - scope of questions under Section 97(2) - advance ruling binding only on the applicant and concerned officer - admissibility of application - rejection under Section 98(2) - composite exempt supply - Entry 12 exemption for renting of residential dwelling - Entry 12A inserted by Notification No. 4/2024

Advance ruling under Section 95(a) - scope of questions under Section 97(2) - admissibility of application - The queries in the applicant's advance ruling application are not admissible as they relate to activities undertaken by the applicant's tenant and not to supplies undertaken or proposed to be undertaken by the applicant. - HELD THAT: - The Authority examined the statutory definition of 'advance ruling' under Section 95(a) and the catalogue of permissible questions under Section 97(2). An advance ruling is available only in respect of supplies of goods or services being undertaken or proposed to be undertaken by the applicant. The principal queries sought a determination whether hostel accommodation provided by the applicant's tenant qualifies as a 'residential dwelling' for exemption purposes for the period 01.07.2017 to 11.07.2024 and whether Entry 12A (inserted by Notification No. 4/2024 with effect from 12.07.2024) would apply. Those queries therefore concern the tenant's activity and do not relate to any supply by the applicant. The question whether incidental supply of in house food constitutes a composite exempt supply is wholly dependent on the primary queries and thus also not admissible. Queries asking whether particular judicial decisions apply to the applicant's facts likewise fall outside the matters enumerated in Section 97(2) and are not admissible. The Authority further noted that an advance ruling is binding only on the applicant and the concerned officer, so precedent rulings in other proceedings cannot render these tenant centric queries admissible. [Paras 6]

All queries are prima facie not covered by the definition of 'advance ruling' and are not admissible for consideration.

Rejection under Section 98(2) - advance ruling binding only on the applicant and concerned officer - The advance ruling application is rejected under Section 98(2) because the questions presented are not admissible under the advance ruling scheme. - HELD THAT: - Having given the applicant an opportunity of personal hearing and considered the submissions, the Authority concluded that the application did not raise questions maintainable as advance ruling matters. The Authority referred to the statutory provisions governing admission and rejection of applications and observed that because the queries concern the tenant's supplies and fall outside Section 97(2), the application must be rejected. The AR was given an opportunity to supply additional materials but did not furnish any documents that could alter the admissibility conclusion; moreover, even potential precedential material would not enlarge the advance ruling's applicability beyond the applicant. Consequently, the Authority declined to enter into merits and proceeded to reject the application. [Paras 6, 7]

Application for Advance Ruling is rejected under Section 98(2) of the CGST Act, 2017.

Final Conclusion: The Authority held that the application was not admissible because the questions related to supplies made by the applicant's tenant (and not by the applicant) and therefore rejected the Advance Ruling application under Section 98(2); no merits determination on exemption or composite supply was made.

Allocation of head office expenses unconnected with the undertakings for calculation of deduction under section 80IB and section 10B - HELD THAT:- As in the assessee’s own case [2024 (11) TMI 818 - ITAT MUMBAI] AO is directed to allocate common expenses and common income to the eligible units, while computing the deduction u/s 10B and section 80-IB of the Act as per the direction issued by the Tribunal in earlier years.

Adjustment to the value of closing stock of raw materials and packaging materials on account of the unutilised balance of CENVAT credit - Since, it is a case of method of accounting and since it is stated that there will be no impact on the profit under both Exclusive method and Inclusive method of accounting, following the decision rendered by the Co-ordinate Bench in AY 2006-07 [2012 (12) TMI 458 - ITAT MUMBAI] we restore this issue to the file of the AO for examining the claim of the assessee.

Reducing the export turnover by the amount of unrealised sales proceeds while computing deduction u/s 80-HHC - We have considered the submissions of both sides and perused the material available on record. We find that while deciding a similar issue in assessee’s own case in Hindustan Unilever Ltd [2023 (8) TMI 1700 - ITAT MUMBAI] following the decision rendered in assessee’s own case for the assessment year 2000-01 restored similar issue to the file of the AO.

Denial of deduction u/s 10B of the Act in respect of internal transfer - In the assessee’s own case for the assessment year 2001-02 while deciding the issue in favour of the assessee, following the decision of Granite Mart Ltd [2020 (5) TMI 238 - KARNATAKA HIGH COURT] to hold that the amount of internal transfer between two EOUs of the assessee is to be considered for the purpose of arriving at the profit eligible for exemption under section 10B of the Act. It is also to be noted here that since the impugned amount is an internal transfer which is shown as sales in one EOU and as expenditure in the other EOU, there is merit in the contention that at entity level it is tax neutral. We delete the addition made by the AO denying the amount of internal transfer as claimed under 10B - We delete the impugned addition made by the AO and the amount of internal transfer is directed to be included in the sales of respective units for determining the export profits for computing the deduction under section 10B.

Nature of receipt - Taxability of the compensation received by the assessee on termination of the agreement for the use of the “Savlon” trademark - Revenue or capital receipt - definition of the term “income” under section 2(24) - HELD THAT:- Applying the test laid down in Kettlewel Bullen and Co. Ltd. [1964 (5) TMI 4 - SUPREME COURT] we are of the considered view that the compensation paid to the assessee pursuant to the Termination Agreement dated 09/10/2003 was in the ordinary course of business and there was no loss to the profit-making apparatus of the assessee and rather it was a compensation for loss of profit itself. Further, the Assignment Agreement was entered into by the assessee in the ordinary course of its business.

Thus, the amount received was in the course of business as the contract with NR Jet was part of the assessee’s business of manufacturing and selling soaps, and any receipt on account of such contract being terminated can only be a trading receipt. It is further pertinent to note that the termination of the assignment of the trademark did not affect the trading structure of the assessee’s business, as the assessee is in the business of manufacturing several brands of soap, and the termination of the contract was a normal incident of the assessee’s business.

Receipt of compensation by the assessee for relinquishment of its licensed user rights of the trademark “Savlon” and for releasing NR Jet obligations under the Assignment Agreement is a revenue receipt and is assessable to tax.

Taxability of a discount on the repayment of a loan - revenue or capital receipt - Discount earned by the assessee on prepayment of Sales Tax liability under the Sales Tax Deferment Scheme floated by the State of Maharashtra is a capital receipt, and thus, is not exigible to tax.

Reducing the profits and gains of the business by 90% of compensation received, discount on prepayment of Sales Tax and other miscellaneous income for the purpose of computation of deduction under section 80-HHC - Profits of the business of an assessee will have to be first computed under the head “Profits and Gains of Business or Profession” in accordance with the provisions of sections 28 to 44D of the Act. In the computation of such profits of business, receipts of income which are chargeable as profits and gains of business u/s 28 of the Act will have to be included. Similarly, different expenses which are allowable under sections 30 to 44D have to be allowed as expenses.

After including such receipts of income and after deducting such expenses, the total of net receipts are profits of the business of the assessee computed under the head “Profits and Gains of Business or Profession” from which deductions are to be made under Clauses (1) and (2) of Explanation (baa) to section 80-HHC of the Act.

Discount on prepayment of Sales Tax, we have arrived at the conclusion in the foregoing paragraphs that the same is capital in receipt. Therefore, we do not find any merit in the findings of the lower authority in reducing 90% of the discount on prepayment of Sales Tax while computing the deduction u/s 80-HHC of the Act.

Compensation received by the assessee upon termination of the trademark license agreement and other miscellaneous income, we are of the considered view that even though these receipts are revenue in nature, but it has to be firstly determined whether they fall under the head “Profits and Gains of Business or Profession”. Only thereafter, the question of deduction as provided under Clause (1) and (2) of Explanation (baa) to section 80-HHC of the Act arises. Since this exercise has not been conducted by the AO as to whether the compensation received and other miscellaneous income fall under the head “Profits and Gains of Business or Profession”, we restore this issue to the file of the AO for necessary examination of this aspect.

Computation of depreciation after reducing the capital subsidy received by the assessee from the Written Down Value (“WDV”) -CIT(A) dismissed the ground raised by the assessee on this issue as the assessee failed to produce the details of the scheme under which capital subsidy was received against its plant and machinery. Therefore, in the interest of justice and fair play, we deem it appropriate to grant one more opportunity to the assessee to place on record necessary evidence in support of its claim that the subsidy was granted for the purpose of inducing the industry to set up units in certain selected backward areas and not for the purpose of meeting a portion of the cost of assets. Accordingly, this issue is restored to the file of the AO for de novo adjudication.

Applicability of the rate of tax on dividend specified in the Double Taxation Avoidance Agreement (“DTAA”) between India and the country of residence of the non-resident shareholders, while levying Dividend Distribution Tax (“DDT”) u/s 115-O of the Act on payment of dividend by the assessee to the non-resident shareholder - We restore this issue to the file of the AO for de novo adjudication, in light of the decision of Colorcon Asia (P.). Ltd. [2025 (12) TMI 677 - BOMBAY HIGH COURT] after necessary examination of various aspects, such as applicability of the DTAA, rate of DDT levied under section 115-O of the Act vis-à-vis the rate of tax on dividend provided in the respective DTAA, etc.

Computation of deduction u/s 80-HHC after reducing royalty income - Tribunal in assessee’s own case for the assessment year 1995- 96 and the decision of its predecessor in assessee’s own case for the assessment years 2002-03 and 2003-04 held that the royalty income is not to be reduced from the profit and gain of business and profession for calculating deduction under section 80-HHC of the Act. Since the issue is recurring in nature and has been decided in favour of the assessee.

Allowability of the deduction claimed under section 10B of the Act in respect of the Kidderpore Unit acquired by the assessee from Lipton India Exports Ltd - We find that while deciding similar issue in assessee’s own case for the assessment year 2001-02 the Coordinate Bench of the Tribunal in assessee’s own case in ACIT vs. Hindustan Unilever Ltd. [2023 (8) TMI 1700 - ITAT MUMBAI] following the decision of GE Thermometrics India Pvt. Ltd. [2015 (1) TMI 10 - KARNATAKA HIGH COURT] held that the assessee is entitled for claiming deduction with respect to, inter alia, Kidderpore Unit acquired from Lipton India Exports Ltd. for the unexpired period since subsections 9 and 9A of section 10B of the Act were omitted without saving clause, and therefore, the same are not applicable to the case of the assessee.

TP Adjustment - adopting the Transactional Net Margin Method (“TNMM”) as the most appropriate method, benchmarked the international transactions entered into by it with associated enterprises at an entity level - HELD THAT:- Tribunal in assessee’s own case for the assessment years 2005-06 [2024 (11) TMI 818 - ITAT MUMBAI] and 2006-07 [2012 (12) TMI 458 - ITAT MUMBAI] has rejected the cherry-picked segregation of transactions and upheld the entity level TNMM benchmarking of the very same international transactions entered into by the assessee in the year under consideration. Addition to be deleted.

Addition on the basis of stock statements not signed by any one of the partners of the assessee - ITAT held stock as declared in statement filed before Bank should be considered.

HELD THAT:- The appellant neither before authorities nor before this Court has pleaded that they did not avail over draft facility as per stock statement relied upon by Income Tax Department. It means the appellant availed over draft facility as per stock statement.

The said statement may or may not be signed because of reuse on the part of appellant or mistake of the Bank, however, it is clear from the statement of Bank Manager that stock was kept in lock and key of Bank’s Godown Keeper. The statement was prepared by Godown Keeper and it was signed by one of the partners of the firm.

In the absence of signatures of partner, it was not entered in the record. Drawing-power of the client was dependent upon stock statement. The appellant was given due opportunity by authorities to disprove stock statement relied upon by Income Tax Department. In the absence of contrary evidence and the fact that appellant was given all possible opportunities to prove that stock statement relied upon by Income Tax Department was not belonging to them, it is highly improbable that anyone other than assessee furnished stock statement especially when it was directly linked with drawing-power and stock statement was prepared by Bank’s Godown Keeper. Decided against assessee.

Refund claim on incorrect outstanding demand in relation to tax deducted at source - Online Tax Accounting System recorded the date of payment as the date of cheque realisation, which was subsequent to the due date and this mismatch resulted in an incorrect levy of interest for late payment of TDS - HELD THAT:- Petitioner had tendered the cheques for TDS payment within the statutory due date, a fact that is certified by the authorised bank itself. The demand has arisen solely because the Respondents' system has taken the date of realisation of the cheque as the date of payment, contrary to the settled legal position.

The Board itself has issued a clarification way back in Circular No. 261 dated 08.08.1979, to the effect that the date of tendering of a cheque is to be considered the date of payment, provided the cheque is subsequently honored. In this case, it is an admitted position that all cheques were duly honored. Thus, when the date of tendering the cheque is considered as the date of payment of TDS, then there is no delay in payment of TDS, and consequently, no liability on account of interest for delayed payment can arise.

Thus, the Petitioner's grievances are entirely justified. This, in fact, is not even disputed by the Respondents. Naturally, the demand is patently incorrect and consequently, the Petitioner's entitlement to the refund which was paid under protest against this incorrect demand, is also justified.

Rejection of application u/s 197 - denial of the certificate at nil rate of tax - Competent Authority has arbitrarily passed the impugned order and proceeded to issue a certificate at the rate of 13.76% (plus applicable surcharge and cess), which works out at a total rate of 15%

HELD THAT:- We are not supposed to observe that all the Authorities are bound by the judgment passed by the High Court and when it comes to the dispute between the parties whose case has been adjudicated by the High Court, unless Competent Authority is able to point out factual difference or some new information which affects the nature of the transaction and its taxability comes to his notice, he cannot take a view other than what has been taken by the High Court. Even the charade of the principle that each assessment year is separate and is to be treated separately cannot shield the illegal refusal to apply the law already settled.

Such type of approach and denial of the certificate at nil rate of tax results in irreversible adverse consequence to the petitioner inasmuch as the petitioner had submitted the application u/s 197 of the Act of 1961 on 12.03.2025 for issuing tax withholding certificate at nil rate, which as per the provisions of Section 197 ought to have been decided latest by 12.04.2025.

On the one hand, the Competent Authority failed to do the same within such period and on the other hand it rejected the application per-viam impugned order, which came to be passed as late as on 19.08.2025.

The approach of the Competent Authority has practically rendered the mandate and provisions of Section 197 of the Act of 1961, a waste piece of paper. Provisions of Section 197 of the Act of 1961 were enacted with an objective to ensure that in case particular transaction(s) is/are not exigible to tax, in light of the treaties between two countries and the provisions of the Act of 1961, (whichever is more beneficial to the assessee) then no tax or tax with lower rate is deducted, so as to ensure that cash flow of an entity is not unnecessarily retarded or blocked. And that the Department or the Revenue is not burdened with the interest (@ 6% per annum) which the revenue is bound to pay on the applicable refund.

We allow the writ petition and set aside the impugned order dated 19.08.2025 and consequential certificate of even date issued @ 15%, we simultaneously direct the Competent Authority to issue a certificate at ‘nil’ rate within a period of 15 days from today.

Addition u/s 68 - LTCG claimed u/s. 10(38) denied - Gain arising on sale of equity shares

HELD THAT:- Assessee has kept the equity shares in Demat account and after holding them for more than a year, has sold equity shares through registered sale broker on online platform of the recognized stock exchange and that the shares have been sold on the live share price appearing on the recognized stock exchange controlled by the SEBI. The assessee also duly paid STT and therefore has fulfilled all the conditions prescribed u/s. 10(38) of the Act for claiming benefit of exemption of LTCG from sale of equity shares.

Respectfully following the decisions referred in the case of Shri Jayesh Kumar Javia (HUF) [2021 (6) TMI 966 - ITAT INDORE] and Affluence Commodities (P.) Ltd.[2024 (4) TMI 199 - GUJARAT HIGH COURT] which has been subsequently affirmed by the Hon'ble Apex Court [2025 (8) TMI 697 - SC ORDER], the alleged claim of assessee u/s. 10(38) of the Act stands allowed.

Addition made u/s. 68 of the Act stands deleted - addition for unexplained expenditure u/s. 69C also stands deleted. Assessee appeal allowed.

Rectification u/s 154 - assessee disallowed certain expenditure which was further disallowed by the AO while passing the intimation u/s 143(1) - Doctrine of merger - HELD THAT:- After considering the findings of the CIT(A) we are not inclined to agree with the findings of the CIT(A) that doctrine of merger is not applicable in the present case.

We noticed that the payment of tax and fresh demand raise by the AO in rectification order u/s 154 of the Act was remanded back to the AO to verify.

Since the issue raised by the assessee in the given appeal also having direct relevance to the mistake apparent on record that assessee itself disallowed certain expenditure which was further disallowed by the AO while passing the intimation u/s 143(1) of the Act.

Remit this issue also to the file of Jurisdictional Assessing Officer to consider the submissions of the assessee as per law. Appeal filed by the assessee is allowed for statistical purposes.

Disallowance u/s 14A r.w.r. 8D - addition being 1% of annual average of investment towards administrative expense - scope ofamendment/Explanation to Section 14A (Finance Act, 2022) - CIT(A) deleted addition - HELD THAT:- The provision of Section 14A of the Act was amended and an Explanation was inserted w.e.f. 01.04.2022, as per which the disallowance under Section 14A of the Act can be made, even if no exempt income is earned during the year.

As in the case of Williamson Financial Services Limited [2024 (9) TMI 1571 - GAUHATI HIGH COURT] has held that the Explanation inserted to Section 14A of the Act vide Finance Act, 2022 w.e.f 01.04.2022 is prospective in nature and cannot be presumed to have retrospective effect and applied to assessment years prior to 01.04.2022.

CIT(A) had rightly deleted the addition made u/s 14A of the Act, as the assessee did not earn any exempt income during the year. Accordingly, the order of the Ld. CIT(A) on this issue is upheld.

Disallowance u/s. 80G - amount expended under CSR activity - assessee had incurred expenditure towards CSR activity which was disallowed under the provision of section 37 - HELD THAT:- The Co-ordinate Bench of Kolkata Tribunal in the case of JMS Mining Pvt. Ltd. [2021 (7) TMI 907 - ITAT KOLKATA] has held that Explanation-2 to section 37(1) of the Act which denies deduction for CSR expenses by way of business expenditure is applicable only to the extent of computing 'Business Income' under Chapter IV-D of the Act. The said Explanation cannot be extended or imported to CSR contributions which is otherwise eligible for deduction under any other provision or Chapter, to say donations made to charitable trusts registered u/s 80G of the Act.

The Co-ordinate Bench of this Tribunal has held in the case of Torrent Power Grid Ltd.[2026 (1) TMI 1036 - ITAT AHMEDABAD] that the CSR expenditure is allowable as deduction u/s 80G of the Act.

In the case of Gabriel India Limited, [2025 (5) TMI 863 - ITAT MUMBAI] that the assessee’s claim for deduction under Section 80G of the Act in respect of CSR expenses was eligible for deduction. CIT(A) had rightly allowed the relief to the assessee and accordingly the order of the Ld. CIT(A) is upheld. The ground taken by the Revenue is dismissed.

Disallowance on account of expenses u/s 37 - purchase of construction material and travelling expenses - Allowability ofbusiness expenses - HELD THAT:- Assessee did not submit the complete details of purchase of construction materials or travelling expense. On the other hand, the AO did not completely believe the explanation of the assessee and disallowed the entire expenses. We find that neither the assessee’s nor the AO explanation can be completely invalidated and there is some element of justification on each side. In the interest of justice therefore, we are of the considered view that 20% of the balance unsubstantiated expense claimed on account of building materials and 20% of the travelling expense be disallowed.

Addition on account of unsecured loans - AO has added the same u/s 68 mainly on the ground that source of source is not proved - HELD THAT:- We find that the AO has examined the bank statements of each lender and found that the loans are extended through banking channels and no cash is involved. Lenders have also confirmed the loan transaction by filing reply to notice u/s 133(6) and the AO has not pointed out any discrepancy in the same. Though repayment of loans is not conclusive evidence of genuineness of loans, all the said lenders have repaid the loans in subsequent years. In one case of loan from T Praveen, the said loan was offered for taxation in subsequent year due to death of T Praveen. We are also in agreement with the assessee that the law of explaining the source of source was not available during the impugned AY 2014-15. Additions made u/s 68 is uncalled for and the same is therefore directed to be deleted.

Leave encashment benefit in terms of Section 10(10AA) - AO’s CPC restricted the benefit on the ground that the employer was other than a Central or a State Government - assessee retired from the Bank of Baroda, a PSU Bank - vide CBDT’s Notification No.31/2023/F.No.200/3/2023 dated 24.05.2023,the said limit of restriction was enhanced to Rs. 25,00,000/-.

HELD THAT:- AO CPC has mistakenly restricted the benefit of claim to Rs. 3,00,000/- even when the amount was enhanced to Rs. 25,00,000/-. Accordingly, we find merit in the submission of the Ld. AR and direct the Ld. AO CPC to grant relief u/s 10(10AA) of the Act to the full extent claimed by the assessee since it is considerably less than the amount of Rs. 25,00,000/- as per the CBDT Circular (supra) - Appeal of the assessee is allowed.

Unexplained investment in mutual funds - CIT(A) deleted addition on admission of additional evidence under Rule 46A of the Income tax Rules- as argued NFAC admitting the additional evidences without calling for remand report from the assessing officer, as per rule 46A of the Income-tax Rules - DR has primarily contended that additional evidence were admitted in violation of Rule 46A of the Income Tax Rules and on merits it was submitted that assessee company had claimed to have received funds for software development when it actually did not have capabilities to undertake such a project

HELD THAT:- CIT(A) observed during the course of appellate proceeding assessee was asked to submit copies of notices issued by the AO, replies filed by the assessee, copies of tax returns of Prem Power Construction, copies of bank account of Prem Power and that of the assessee and audited profit and loss account and balance sheet of the companies which were submitted on 18.01.2023 and have been reproduced in the impugned order.

Thus, it is not the case of the assessee taking recourse of provision of Rule 46A by filing additional evidence but FAA has exercised its discretion to call for material substantiating the grounds.

Then, the bank statement of the assessee has been relied by ld. CIT(A), which shows transactions pertaining to investments and redemption in different mutual funds. This statement as relied by ld. CIT(A) shows receipts from Prem Power Construction Pvt. Ltd. and the return of funds back to said company.

The bank statement has been relied by ld. First Appellate Authority whish shows expenses carried out by the assessee. The balance sheet of Prem Power Construction Pvt. Ltd. having surplus of Rs. 9 crores established its creditworthiness to make the payments for development of software and being a different matter that the project did not pick up. That alone cannot make the transaction not genuine and source be called ‘unexplained’ in the hands of assessee. Decided against revenue.

Adjustments under Income Computation and Disclosure Standards (‘ICDS’) - intimation u/s. 143(1)(a) of the Act incorporating the ICDS adjustment -effect of quashing of intimation on assessment computation - HELD THAT:- While disposing of the Writ Petition registered as Writ Petition [2026 (1) TMI 1485 - BOMBAY HIGH COURT] HC had quashed the intimation issued u/s. 143(1)(a) of the Act by CPC making the ICDS adjustment.

Thus, once the intimation u/s. 143(1)(a) of the Act incorporating the ICDS adjustment has been quashed by the Hon'ble Jurisdictional High Court, consequential effect relating to such adjustment is bound to be given in the computation of total income in the assessment order passed u/s. 143(3) of the Act.

We direct the A.O. to make necessary modification to the total income computed in the assessment order dated 26.03.2024 passed u/s. 143(3) r.w.s. 144B of the Act by deleting the ICDS adjustment of Rs. 1284.66 crores made by the CPC.

Validity of reopening of assessment - date of issuance of section 148 notices under the old regime - period of limitation u/s 149 - scope of period prescribed under TOLA - extended due date for issuance of notice u/s 148

HELD THAT:- In view of the observation in the case of Rajeev Bansal [2024 (10) TMI 264 - SUPREME COURT (LB)] the extended due date for issuance of notice u/s 148 of the Act expired on 25-06-2022 and since, the notice is u/s 148 of the Act is issued on 20-07-2022 the said notice is to be treated as time barred by limitation and consequentially reassessment proceedings would be liable to be quashed as void ab initio. Respectfully following the decision of the Hon’ble Supreme Court, we hold that the notice issued u/s 148 of the Act on 20-07-2022 is time barred by limitation. Accordingly the legal issue raised by the assessee is allowed.

Assessment u/s 153A - Admissibility of loose papers as evidence - HELD THAT:- Loose sheet of papers found in the search, in the case of the assessee, are wholly irrelevant as evidence being not admissible u/s 34 of the Evidence Act so as to constitute evidence with respect to the transactions mentioned therein, being uncorroborated with any books of account. They are merely rough sheets, without any dates and wherever dates are mentioned, they do not pertain to the impugned year.

No merit in the additions made by the Assessing Officer, based on the above seized rough sheets. Therefore, we direct the Assessing Officer to delete the impugned additions. Ground of assessee is allowed.

Loan taken by the assessee from Muthoot Finance Ltd. - CIT(A) upheld the same stating that no details of security for such loan was give by the assessee - We find that the said cash was taken as loan from Muthoot Finance Ltd against security of jewellery. Neither the AO examined that the same is not reflected in assessee’s books of account as claimed by the assessee nor the CIT(A) examined the same. We are therefore of the view that the said addition is not sustainable in law. Accordingly, we direct the AO to delete the said addition.

Addition on account of deemed income from House property - addition of an ad-hoc amount as deemed house property income on the ground that the assessee had shown no such income as against house property income declared in the previous AY - As assessee stated before the CIT(A) that the assessee being in Real Estate business, had rented out its inventory flat which was sold during AY 2014-15 and hence no house property income was shown in the impugned year. AO/CIT(A) has neither examined the explanation of the assessee nor verified the factual position. We therefore are of the considered view that such ad-hoc addition as deemed income from House property is not justified without verification of facts and direct the AO to delete the said addition.

Assessment being made u/s 153A/143(3) without incriminating materials, are dismissed as the AO has validly assumed the jurisdiction u/s 153A on the basis of incriminating materials as discussed above. The ground 1 to 4 are dismissed.

Unexplained expenditure u/s. 69C - Addition on account of adhoc 12.5% - creditor not responding to the notice u/s.133(6)

HELD THAT:- Section 69C can be invoked only in a case where the assessee has incurred any expenditure and the assessee offers no explanation about the source of such expenditure. However, in the instant case of the assessee, there can be no dispute about the source of the purchases as all the purchases are duly recorded in the books of accounts of the assessee.

In the present case it is noted that the books of accounts of the assessee are audited and have not been rejected by the AO and even the AO has not pointed out any discrepancy in the books of accounts. It is further noted that AO had issued notices u/s. 133(6) and no replies were received and this non compliance to the notices issued u/s. 133(6) by the AO cannot be a ground for drawing adverse inference against the assessee, in view of the various decision including Wel Intertrade Pvt. Ltd [2023 (4) TMI 748 - DELHI HIGH COURT] wherein, it has been held that creditor not responding to the notice u/s. 133(6) cannot be a ground / reason by the AO to make an addition and also Prabhat Gupta [2017 (12) TMI 1667 - ITAT MUMBAI] held that disallowance of purchase could not be made on the ground that notice u/s. 133(6) issued to parties were not served or no replies were received.

Addition made by the AO is not sustainable and deserve to be deleted. Assessee appeal allowed.

Disallowance u/s 37(1) - amount was paid to Chettinad Cements for loss of certain quantity of goods in the process of transportation of their goods - allowable as business expenditure or nature of penalty for violation of law

HELD THAT:- The non-response of M/s.Chettinad Cements Ltd. to the notice issued u/s. 133(6) of the Act, by itself, cannot be a ground to disallow the claim when the assessee has furnished contemporaneous documentary evidence substantiating the transaction and the payment has been made through banking channels. The genuineness of the payment has not been doubted by the authorities below.

We hold that the payment made by the assessee to M/s.Chettinad Cements Ltd. is compensatory in nature, incurred wholly and exclusively for the purpose of business, and does not fall within the mischief of the Explanation to section 37(1) of the Act. Disallowance made by the Assessing Officer and confirmed by the ld. CIT(A) is unsustainable. Appeal filed by the assessee is allowed.

Error in the impugned order passed -Valuation of imported goods - Silicone Weather Proofing Sealant - Fast Track Acqua – tech very high bond foamed acrylic tape - rejection of declared value - revaluation of goods - HELD THAT:- Upon hearing the parties and perusal of materials available on record, we do not find any error in the impugned order [2020 (8) TMI 401 - CESTAT NEW DELHI], passed by the Customs, Excise & Service Tax Appellate Tribunal, New Delhi. Accordingly, the appeal is dismissed.

Statutory pre-deposit as condition precedent to maintain appeal - appeal is a creature of statute - no appropriation or adjustment of payments made by one party against another party's pre-deposit - separate liabilities of co-accused / co-obligors - condonation of delay and restoration of appeal upon compliance with statutory pre-deposit - HELD THAT:- It is the petitioner’s case that the order in original dated July 14, 2014 had been challenged by the company i.e. M/s. Beriwala Impex Private Limited before CESTAT and that during pendency of the appeal, CESTAT has allowed the said appeal by an order dated February 23, 2022 thereby holding that the entire proceeding initiated against the company was without jurisdiction.

It is evident that earlier, when the matter had been taken up by the Hon’ble Division Bench, it had been submitted before the Hon’ble Division Bench on behalf of the petitioner that as it would not be possible for the petitioner to put in the statutory pre deposit and avail the statutory remedy therefore the petitioner should be permitted to challenge the order in original before this Court. Such contention of the petitioner was repelled and negated by the Hon’ble Division Bench by observing that “an appeal is a creature of statute and any condition imposed in the exercise of the right of appeal need necessarily be complied with to avail of such remedy”.

Accepting such order of the Hon’ble Division Bench, the petitioner approached CESTAT and filed the appeal. However, the petitioner could not comply with the condition of pre deposit and such failure led to the dismissal of the petitioner’s appeal. That, in the considered view of the Court, cannot clothe the petitioner with any fresh right to approach the Writ Court and seek relaxation of condition of pre deposit in whatever manner.

Furthermore, it is not the petitioner’s case that the company paid the duty subsequent to the order passed by the Hon’ble Division Bench and that being so, there is no change in circumstances also. The party continues to be at the same place and in the same position where the party was at the time when the Hon’ble Division Bench decided the petitioner’s appeal.

Above all, there is no provision in the statute that permits any appropriation or adjustment of payments made by a party in terms of an order in original with statutory pre deposit required to be made by another person for the purpose of filing or maintaining such other person’s appeal.

Writ petition dismissed.

Statutory pre-deposit as condition precedent to preferring an appeal - maintainability of writ petition where an efficacious statutory remedy exists - no set-off or appropriation of payments made by a co-party against another party's pre-deposit obligation - separate liabilities of distinct parties under adjudication - condonation of delay and restoration of appeal by the Tribunal upon compliance with pre-deposit - HELD THAT:- It is the petitioner’s case that the order in original dated July 14, 2014 had been challenged by the company i.e. M/s. Beriwala Impex Private Limited before CESTAT and that during pendency of the appeal, CESTAT has allowed the said appeal by an order dated February 23, 2022 thereby holding that the entire proceeding initiated against the company was without jurisdiction.

It is evident that earlier, when the matter had been taken up by the Hon’ble Division Bench, it had been submitted before the Hon’ble Division Bench on behalf of the petitioner that as it would not be possible for the petitioner to put in the statutory pre deposit and avail the statutory remedy therefore the petitioner should be permitted to challenge the order in original before this Court. Such contention of the petitioner was repelled and negated by the Hon’ble Division Bench by observing that “an appeal is a creature of statute and any condition imposed in the exercise of the right of appeal need necessarily be complied with to avail of such remedy”.

Accepting such order of the Hon’ble Division Bench, the petitioner approached CESTAT and filed the appeal. However, the petitioner could not comply with the condition of pre deposit and such failure led to the dismissal of the petitioner’s appeal. That, in the considered view of the Court, cannot clothe the petitioner with any fresh right to approach the Writ Court and seek relaxation of condition of pre deposit in whatever manner.

Furthermore, it is not the petitioner’s case that the company paid the duty subsequent to the order passed by the Hon’ble Division Bench and that being so, there is no change in circumstances also. The party continues to be at the same place and in the same position where the party was at the time when the Hon’ble Division Bench decided the petitioner’s appeal. Above all, there is no provision in the statute that permits any appropriation or adjustment of payments made by a party in terms of an order in original with statutory pre deposit required to be made by another person for the purpose of filing or maintaining such other person’s appeal.

This Court is therefore unable to accede to the petitioner’s request.

Writ petition dismissed for want of maintainability insofar as it challenges CESTAT's dismissal for non-fulfilment of statutory pre-deposit.

Classification of imported goods - entitlement to benefit of the post-adjudication clarificatory CBIC circulars and related GST Council recommendations - regularisation on "as is where is basis" - retrospective application of beneficial clarificatory circulars - binding effect of departmental circulars on adjudicating officers - audi alteram partem / right to be heard - HELD THAT:- The order passed by the Commissioner does not reveal on which date the appeal was listed for hearing and was heard at least from side of the Department but going by the written submissions of the appellant available on record, it is noticeable that contrary to what is recorded in the Commissioner’s order at para 19.2, there were two notices issued to them (not three) out of which hearing on 23.08.2023 could not take place as Commissioner was unavailable on that day and appellant could not attend the hearing on 20.08.2024 but emailed on the next day seeking another date for such hearing and thereafter, order was passed. This being so, it cannot be pleaded by the Department that circular came after issue of show-cause and adjudication since by the time adjudication happened, it was already on place.

Further, in the context as to if retrospectively can be attached to the said circular and if it has got biding effect on the officers, it would be worthwhile to refer to the relied upon judgment in the case of Ranadey Micronutrients Vs. Collector of Central Excise [1996 (9) TMI 124 - SUPREME COURT], that dictates that such circulars should have been treated as issued u/s. 37B of the Central Excise Act 1944 (similar to provision contained in Section 151A of the Customs Act.) even though the said provision is not recited in the circular and such circulars are not advisory in nature but binding on the Central Excise officers who can not plead that such circular was not valid.

Apart from this, it has also been clearly directed in the other judgments cited by appellant in the case of Suchitra Components Ltd. [2007 (1) TMI 4 - SUPREME COURT], beneficial circular is to be applied retrospectively but when circular is against the assessee, they have a right to claim prospective application but in the instant case, this circular has in clear and unequivocal language has clarified in para 4.3 as to how past cases are to be regularised onward.

Therefore, we are of the considered view that appellant had duly discharged CGST on the parts of Poultry keeping machinery @12% imported during the period between September 2017 and December 2021, for which the order passed by the Commissioner is unsustainable both in law and facts. Hence the order.

Appeal is allowed.

Imposition of penalty u/s 112(a)(i) - Violation of Regulation 19 of Customs House Agents Licensing Regulations, 2004 - Requirement of pleading and proof of knowledge for imposition of penal liability - HELD THAT:- The show cause notice, as noticed, merely alleges violation of regulation 19 of the 2004 Regulations. It does not make any mention as to why penalty under section 112(a)(i) of the Customs Act should be imposed upon the appellant. Only in paragraph 87(VI) of the show cause notice it has merely been stated that penalty can be imposed upon the appellant under section 112(a)(i) of the Customs Act. The impugned order notices that there is no allegation against the appellant for imposition of penalty under section 112(a)(i) of the Customs Act, but still it proceeds to impose penalty upon the appellant for the reason that there was enough evidence on record to show that the acts of omission and commission on the part of the appellant would render the appellant for penalty under section 112(a)(i) of the Customs Act. Therefore, penalty under section 112(a)(i) of the Customs Act could not have been imposed upon the appellant.

This is what was held by the Delhi High Court in Buhariwal Logistics [2015 (12) TMI 1149 - DELHI HIGH COURT] The Delhi High Court observed that mere violation of the provisions of 2004 Regulations cannot be made a ground to impose penalty under section 112(a)(i) of the Customs Act.

Thus, the impugned order dated 31.03.2013 passed by the Commissioner insofar as it imposes penalty upon the appellant under section 112(a)(i) of the Customs Act cannot be sustained and is set aside. The appeal is, accordingly, allowed.

Relevancy of statements recorded u/s 108 - Procedure u/s 138B(1)(b) for admitting statements in adjudication - Mandatory character of statutory procedure for admission of recorded statements - Admissibility of statements recorded during investigation versus evidence after examination and opinion of adjudicating authority - Penalty liability u/s 112(a)(i) and 112(a)(ii) - Right to cross-examination - Whether the Commissioner committed an error in solely placing reliance upon the statements made by the appellant and Lokesh Garg u/s 108 for the purpose of imposing penalties upon the appellant. - HELD THAT:-A Division Bench of this Tribunal in Surya Wires [2025 (4) TMI 441 - CESTAT NEW DELHI] held that the statements made under section 108 of the Customs Act during the course of an inquiry under the Customs Act shall be relevant for the purpose of proving the truth of the facts contained in them only when such persons are examined as witnesses before the adjudicating authority and the adjudicating authority forms an opinion that the statements should be admitted in evidence.

Both section 138B(1)(b) of the Customs Act and section 9D(1)(b) of the Central Excise Act contemplate that when the provisions of clause (a) of these two sections are not applicable, then the statements made under section 14 of the Central Excise Act or under section 108 of the Customs Act during the course of an inquiry under the Acts shall be relevant for the purpose of proving the truth of the facts contained in them only when such persons are examined as witnesses before the adjudicating authority and the adjudicating authority forms an opinion that the statements should be admitted in evidence. It is thereafter that an opportunity has to be provided for cross-examination of such persons. The provisions of section 138B(1)(b) of the Customs Act and section 9D of the Central Excise Act have been held to be mandatory and failure to comply with the procedure would mean that no reliance can be placed on the statements recorded either under section 108 of the Customs Act or under section 14D of the Central Excise Act. The Courts have also explained the rationale behind the precautions contained in the two sections. It has been observed that the statements recorded during inquiry/investigation by officers has every chance of being recorded under coercion or compulsion and it is in order to neutralize this possibility that statements of the witnesses have to be recorded before the adjudicating authority, after which such statements can be admitted in evidence.

As seen from the show cause notice and the order impugned, penalty upon the appellant has been imposed only on the basis of the statement made by the appellant under section 108 of the Customs Act. A statement made under section 108 of the Customs Act cannot be considered as relevant as the procedure contemplated under section 138B of the Customs Act was not followed.

In view of the aforesaid decisions and the fact that penalties have been imposed upon the appellant solely on the basis of statements made by the appellant and Lokesh Garg under section 108 of the Customs Act, the imposition of penalties upon the appellant under sections 112(a)(i) and 112(a)(ii) of the Customs Act cannot be sustained and are set aside. The appeal, insofar as it imposes penalties upon the appellant, is accordingly, allowed.

Abetment- Mens rea/knowledge requirement for abetment - Penalty u/s 112(a)(i) - admissibility of departmental statements- Relevancy procedure u/s 138B(1)(b) - Mandatory compliance of procedural safeguards before admitting recorded statements - HELD THAT:- In Additional Director General (Adjudication) vs. Its My Name Pvt. Ltd. [2020 (6) TMI 72 - DELHI HIGH COURT] decided on 01.06.2020, the Delhi High Court examined the provisions of sections 108 and 138B of the Customs Act. The department placed reliance upon the statements recorded under section 108 of the Customs Act. The Delhi High Court held that the procedure contemplated under section 138B(1)(b) has to be followed before the statements recorded under section 108 of the Customs Act can be considered as relevant.

A Division Bench of this Tribunal in Surya Wires [2025 (4) TMI 441 - CESTAT NEW DELHI] held that the statements made under section 108 of the Customs Act during the course of an inquiry under the Customs Act shall be relevant for the purpose of proving the truth of the facts contained in them only when such persons are examined as witnesses before the adjudicating authority and the adjudicating authority forms an opinion that the statements should be admitted in evidence.

Both section 138B(1)(b) of the Customs Act and section 9D(1)(b) of the Central Excise Act contemplate that when the provisions of clause (a) of these two sections are not applicable, then the statements made under section 14 of the Central Excise Act or under section 108 of the Customs Act during the course of an inquiry under the Acts shall be relevant for the purpose of proving the truth of the facts contained in them only when such persons are examined as witnesses before the adjudicating authority and the adjudicating authority forms an opinion that the statements should be admitted in evidence. It is thereafter that an opportunity has to be provided for cross-examination of such persons. The provisions of section 138B(1)(b) of the Customs Act and section 9D of the Central Excise Act have been held to be mandatory and failure to comply with the procedure would mean that no reliance can be placed on the statements recorded either under section 108 of the Customs Act or under section 14D of the Central Excise Act. The Courts have also explained the rationale behind the precautions contained in the two sections. It has been observed that the statements recorded during inquiry/investigation by officers has every chance of being recorded under coercion or compulsion and it is in order to neutralize this possibility that statements of the witnesses have to be recorded before the adjudicating authority, after which such statements can be admitted in evidence.

As seen from the show cause notice and the order impugned, penalty upon the appellant has been imposed only on the basis of the statement made by the appellant under section 108 of the Customs Act. A statement made under section 108 of the Customs Act cannot be considered as relevant as the procedure contemplated under section 138B of the Customs Act was not followed.

Thus, the impugned order dated 31.03.2013 passed by the Commissioner insofar as it imposes penalty upon the appellant under section 112(a)(i) of the Customs Act cannot be sustained and is set aside and appeal is allowed.

Relevancy of statements recorded u/s 108 - Mandatory procedure u/s 138B(1)(b) of the Customs Act and Section 9D(1)(b) of the Central Excise Act - Admissibility of investigation statements only after examination before the adjudicating authority and formation of opinion in the interests of justice - Prohibition on reliance upon statements recorded during inquiry without compliance with statutory safeguards - Whether the Commissioner could sustain a penalty u/s 112(a)(i) of the Customs Act based solely on a statement recorded u/s 108 without following the procedure prescribed by Section 138B(1)(b). - HELD THAT:- A Division Bench of this Tribunal in Surya Wires [2025 (4) TMI 441 - CESTAT NEW DELHI] held that the statements made under section 108 of the Customs Act during the course of an inquiry under the Customs Act shall be relevant for the purpose of proving the truth of the facts contained in them only when such persons are examined as witnesses before the adjudicating authority and the adjudicating authority forms an opinion that the statements should be admitted in evidence.

Both section 138B(1)(b) of the Customs Act and section 9D(1)(b) of the Central Excise Act contemplate that when the provisions of clause (a) of these two sections are not applicable, then the statements made under section 14 of the Central Excise Act or under section 108 of the Customs Act during the course of an inquiry under the Acts shall be relevant for the purpose of proving the truth of the facts contained in them only when such persons are examined as witnesses before the adjudicating authority and the adjudicating authority forms an opinion that the statements should be admitted in evidence.

It is thereafter that an opportunity has to be provided for cross-examination of such persons. The provisions of section 138B(1)(b) of the Customs Act and section 9D of the Central Excise Act have been held to be mandatory and failure to comply with the procedure would mean that no reliance can be placed on the statements recorded either under section 108 of the Customs Act or under section 14D of the Central Excise Act. The Courts have also explained the rationale behind the precautions contained in the two sections. It has been observed that the statements recorded during inquiry/investigation by officers has every chance of being recorded under coercion or compulsion and it is in order to neutralize this possibility that statements of the witnesses have to be recorded before the adjudicating authority, after which such statements can be admitted in evidence.

As seen from the show cause notice and the order impugned, penalty upon the appellant has been imposed only on the basis of the statement made by the appellant under section 108 of the Customs Act. A statement made under section 108 of the Customs Act cannot be considered as relevant as the procedure contemplated under section 138B of the Customs Act was not followed.

Thus, for all the reasons stated above, the impugned order dated 31.03.2013 passed by the Commissioner insofar as it imposes penalty upon the appellant under section 112(a)(i) of the Customs Act cannot be sustained and is set aside. The appeal is, accordingly, allowed.

Determination of export duty based on Fe content - validity of re-test and competence of testing authority - reliance on multiple laboratory test reports in final assessment - provisional assessment - acceptance of invoice as transaction value - application of Board's Circular No. 30/2017-Cus on re-test results -HELD THAT:- The Learned AR submits that the two Test Reports of CRCL Kolkata and Delhi clearly showed that the Fe content was more than 58%. Therefore, he submits that the Adjudicating authority is in error in ignoring these test reports to come to a conclusion that the Fe content is less than 58%. He prays that the appeal may be allowed by setting aside the impugned order.

After going through the factual details, we find that indeed the 2nd re-test was allowed to be taken up by the Revenue. The 2nd Test result shows Fe content of 55.6%, when tested by CRCL Mumbai. It is also an admitted fact that the discharge port Fe content was @ 57.2% and the transaction value towards export realization is based on such Fe content only. Therefore, we find that both the lower authorities have gone into considerable details to verify the factual position to arrive at their decision. We do not find any necessity to interfere with their considered findings. Therefore, we dismiss the Revenue’s appeal.

Classification of parts of aircraft and helicopters - Parts of aeroplanes, helicopters or unmanned aircraft (CTH 8807 / 88073000) - Suitability for use solely or principally with the goods of Chapter 88 - Exclusion by Notes to Section XVII (Note 2 and Note 3) - HSN explanatory notes to Section XVII regarding parts and accessories - General Rules of Interpretation - preference for the most specific heading - Advance ruling u/s 28H(2) - HELD THAT:- On plain reading of the Note 2 the section XVII and its relevant explanatory Note, the subject goods i.e. "parts of aircraft and helicopters" do not appear to be excluded by the said Note 2. Further, part b of Note 2 i.e. Note 2.b covers parts of general use. I observe that as per applicant's submission the subject goods "parts of aircraft and helicopters" are manufactured are manufactured as per the respective customer's designs/drawings/specifications do not have any multiple use and can't be used for the purpose other than parts of aircraft and helicopters.

In view of the forgoing discussion it emanates that the subject goods "parts of aircraft and helicopters" are not of general use and are not excluded from section XVII in terms of Note 2 or Note 3 of the said section and are classifiable under this section as parts of aircraft and helicopters i.e. parts of goods of heading 8802. Also, as the subject gods are neither 'Propellers and rotors and parts thereof nor 'Under-carriages and parts thereof'. Therefore, the subject goods are not classifiable under CTI 88071000 or 88072000.

Now, the subject goods are not classifiable under CTI 88071000 and 88072000 of CTH 8807. The same liable to fall and classifiable under tariff item 88073000 as 'Other parts of aeroplanes, helicopters or unmanned aircraft'.

The ratio of the latest judgement in the matter of M/s. Dynamatic Technologies Ltd Vs The Commissioner of Customs Airport & Air Cargo Complex, Bengaluru [2025 (9) TMI 880 - CESTAT BANGALORE], wherein the hon'ble CESTAT held that Aluminium Bushes Flanges, Aluminium Fitting, Bolts, Grommet used as a part of aircraft/helicopters are classifiable under CTH 88039000 as "parts of the Aircraft/helicopter" is squarely applicable in the instant matter.

On the basis of foregoing discussions and observation, the subject goods/components (176 numbers in parts) as detailed in the Annexure-I to this ruling are classifiable under CTH 8807 as parts of aeroplanes and helicopters, and more specifically under CTI 8807300 as Other parts of aeroplanes, helicopters or unmanned aircraft, of the first schedule to the Customs Tariff Act, 1975, as amended.

Sustainability of service tax demand - taxable services under the category of “Maintenance and Repair Services”, “Business Auxiliary Services” etc -exemption for services in rural areas under Notification No.25/2012-ST (Sl.No.29(g)) - reliance on Form 26AS / Income tax returns for raising service tax demands - extended period of limitation - requirement of independent corroborative evidence to establish rendition of taxable services - adjustment of negative liability after verification - HELD THAT:-On going through the details of the present case, it is seen that the demand has been made based on the 26AS Returns in respect of the IT Returns filed by the Appellant. It is clear that the investigation was taken up only after receiving the information from Income Tax Department. It is also on record that while the Show Cause Notice was proposing to demand Rs.1.45 Crores. After proper clarification by the Appellant and verification by the lower authorities, the same was brought down to the tune of Rs.41.01 Lakhs. Admittedly, the Revenue is not agitated by the dropping of demand of over Rs.1.03 Crores. In respect of the services rendered to the Rural Areas, the appellant has not charged the Service Tax. All these point out that proper case of suppression with intent to evade payment of Service Tax has not been made out clearly against the Appellant.

In respect of demands made based on the Form 26AS and IT Returns, this Bench in the case of Tabassum Enterprises vs. C, CGST & CX [2025 (9) TMI 1275 - CESTAT KOLKATA], Applying the ratio of this case law, hold that the demand for the extended period is legally not sustainable. From the Table V of the Order-in-Appeal reproduced above, it is seen that in case of period 2015-16, the liability for Service Tax shows as (–) Rs.19,66,876. While I set aside the demand for the extended period. The Appellant should be given the benefit of this minus figure of Rs.19,66,876/- after due verification, when the actual quantification for the normal period is arrive at.

Thus, the Appeal stands partly allowed. The Appellant would be eligible for consequential relief, if any, as per law.

Reliance on Form 26AS/Income Tax returns as sole basis for service tax demand - requirement of independent corroborative evidence to establish rendition of taxable service - invocation of extended period of limitation without independent verification - exigibility of service tax in Negative List regime requires connection of provider, recipient, service and consideration - HELD THAT:- The Show Cause Notice has been issued purely based on the Income Tax Returns for which the Appellant has filed the Returns in 2014-15. There is nothing on record to suggest from the Show Cause Notice that any investigation or verification was taken up to know the details of services rendered by the Appellant. If proper investigation was taken up, the appellant could have given the details of the Works Contract undertaken by them to defend their stand that the same is covered by exemption notification. The appellant being a proprietorship firm, part of the Service Tax liability, if any, is required to be discharged by the recipient of the service. Without undertaking such detailed verification, the SCN has been issued by invoking the extended period provisions. This issue is no more res integra. This fact in the case of Tabassum Enterprises vs. C, CGST & CX [2025 (9) TMI 1275 - CESTAT KOLKATA].

Thus, set aside the impugned order and allow the Appeal. The Appellant would be eligible for consequential relief, if any, as per law.

Cenvat Credit eligibility for input services paid by head office for use across units - Input services used for providing taxable output service - Integral nature of sale of scrap to maintenance and repair contracts - Service Tax not leviable where VAT discharged on deemed sale / transfer of right to use - Input Service Distribution (ISD) requirement where head office invoices and pays -

HELD THAT:- Cenvat Credit availed by the appellant (head office) in respect of the input service ordered and used by it at different locations where invoices have been issued on and payment on Service Tax have been made by the appellant (head office). - We find that the said issue has been decided by this Tribunal in appllant’s own case [2023 (9) TMI 1092 - CESTAT KOLKATA] - As issue is squarely covered by in appellant’s own case for the earlier period we hold that the impugned demand is not sustainable against the appellant for demand of Cenvat Credit on account of input service used by different location of the appellant and for which appellant has made the payment. Therefore, demand raised on account of Cenvat Credit is not sustainable.

Denial of Cenvat Credit - HELD THAT:- Cenvat Credit cannot be denied to the appellant as appellant has is required to clear the scrap for maintenance and repair services. - We further take note of the fact that as the sale of the scrap is the integral part of the maintenance and repair service therefore, same do qualify as input service and which has been used for providing output taxable service. Therefore, Cenvat Credit cannot be denied to the appellant. Therefore, demand on account of denial of Cenvat Credit is not sustainable.

VAT on providing equipments on hire and paying VAT - HELD THAT:- Admittedly in this case also the appellant has paid VAT on the transaction of providing equipments on higher. In that circumstances no Service Tax is payable by the appellant as they have discharged VAT thereon. Therefore, the demand of Service Tax confirmed against the appellant is set aside.

Thus, it is concluded that Cenvat Credit cannot be denied to the appellant as per impugned orders and demand of Service Tax is also not sustainable against the appellant as per impugned orders.

Mining service - Goods Transport Agency Services - appellant's activities of transportation of coal and civil construction work - taxable as "mining service" u/s 65(105)(zzzy) of the Finance Act, 1994 - suppression of facts - reverse charge mechanism - extended period of limitation - normal period of limitation u/s 73(1) of the Finance Act, 1994 - HELD THAT:- The activities undertaken by the appellant are in the nature of pure transportation and civil construction work. In the impugned orders, these activities were classified under the category of “mining services” treating the same as activities undertaken “in relation to” mining. In this regard, we are of the view that the said activity of transportation of coal and construction services cannot be classified under the category of “mining services” as defined under Section 65(105)(zzzy) of the Finance Act, 1994. In fact, it is observed that the said services are appropriately classifiable under the category of “Goods Transport Agency Services Service”. In support of our view, we rely on the decision of the Hon’ble Supreme Court in the case of Commissioner of C.Ex. & S.T., Raipur v. Singh Transporters [2017 (7) TMI 494 - SUPREME COURT], wherein it has been held that transportation of coal within mines is taxable under GTA Services and not mining services. However, the impugned demand has been raised under the category of “mining service”. As the said services cannot be classified as mining services, we are of the considered view that the demand raised against the appellant under the said category cannot be sustained.

We also find that the demand in respect of the first Show Cause Notice (SCN-1) is barred by limitation. The dispute in respect of the said Notice pertains to the period from 2008-09 to 2012-13 (SCN-1) whereas the Show Cause Notice was issued on 18.02.2015 i.e. beyond normal period of limitation of one year under Section 73(1) of the Act.

Further, we note that the proceedings in the instant case were initiated on the basis of finding in EA 2000 Audit of the appellant’s balance sheet, profit & loss account, books of accounts, etc., and not based on any new facts. Therefore, we find that suppression of facts with intention to evade tax on the part of the appellant has not been established in this case and hence, we hold that extended period of limitation cannot be invoked in this case.

Thus, by relying on the decisions cited supra, we hold that the demands of Service Tax, confirmed in the impugned orders under the category of “mining service”, are not sustainable and hence we set aside the same.

As the demands of Service Tax are found to be unsustainable, the question of demanding interest and imposing penalty thereon does not arise. Accordingly, we set aside the demand of interest as well as the penalties imposed, as confirmed in the impugned orders.

In the result, we set aside the impugned orders and allow the appeals filed by the appellant, with consequential relief, if any, as per law.

Restriction on Cenvat credit under Rule 6(3)(c) of the Cenvat Credit Rules, 2004 - Definition of exempted service under Rule 2(e) of the Cenvat Credit Rules, 2004 - Taxability of life insurance/ULIP premium and treatment of investment/savings component - Utilisation of Cenvat credit by providers of taxable and exempted services -Whether the appellant is manufacturing dutiable and exempted goods to attract Rule 6(3)(c) of Cenvat Credit Rules, 2004 - HELD THAT:- The Commissioner in the impugned orders has dropped the proceedings on the ground that the appellant had availed credit only to the extent of 20% of the amount of service tax payable on the taxable output services. The grievance of the appellant is that they are eligible for 100% credit since they do not fall under the provisions of Rule 6 of the Cenvat Credit Rules, 2004 to attract restriction of cenvat credit as per Rule 6(3)(c) of Cenvat Credit Rules, 2004.

The Commissioner has also relied on the CBEC Circular F. No.354/9/2011 TRU dated 12th July 2011 to deny the benefit of 100% credit. This issue is no longer res integra inasmuch as various Tribunals have categorically held that since the appellant is paying service tax at the rate of 1% on the gross amount of premium charged, the services rendered by the appellant cannot be considered as exempted services as defined under Rule 2(e) of the Cenvat Credit Rules, 2004.

We find that this issue is no longer res integra inasmuch as this Tribunal vide Final Order [2023 (12) TMI 181 - CESTAT BANGALORE] in appellant’s own case in a similar set of facts.

Thus, we do not find any reason to sustain the impugned orders. Appeals are allowed.

Vires of Rule 8(3A) of the Central Excise Rules, 2002 - payment of duty by utilizing CENVAT credit during default period - liability to pay interest for delayed payment under Rule 8(3) - penalty under Rule 25 read with Section 11AC vs penalty under Rule 27 of Central Excise Rules - HELD THAT:- We find that Hon’ble High Court of Gujarat in its decision in the case of Indsur Global Ltd. [2014 (12) TMI 585 - GUJARAT HIGH COURT] has declared that part of sub-Rule (3A) of Rule 8 which prescribes "payment of duty without utilizing the Cenvat Credit till an assessee pays the outstanding amount including interest” as unconstitutional. This decision has attained finality after dismissal of Revenue’s appeal against this order, by Hon’ble Apex Court on monetary grounds.

Therefore, payment of duty by the appellant by using Cenvat credit during the default period is no more in dispute after the order dated 24.07.2024 of the Hon’ble Apex Court. This being the position, demand of duty having been made under the authority of unconstitutional provision declared as such by Hon’ble Gujarat High Court, cannot be sustained. As far as, liability to pay interest for the default period is concerned, Hon'ble Gujarat High Court has held that this liability continues as per sub-rule (3) of Rule 8 of the said Rules. Hon’ble Court also validated Revenue’s stand that an assessee in default has to clear all consignments on payment of duty during the default period. The appeal is therefore allowed to the extent of duty demand confirmed by the lower authorities. We however add that the appellant would be liable to pay interest in case there is any delay in payment of excise duty.

Contravention of the provisions of Central Excise Rules - HELD THAT:- As discussed, provisions of Rule 8 have been contravened, for which we hold the appellant liable to pay penalty under Rule 27 of the Central Excise Rules, 2002. The appellant has pleaded that Rule 27 has not been invoked in this case for imposing penalty. However, there are a number of decisions where it has been held that mentioning wrong provision or not mentioning provision does not vitiate the proceedings.

Thus, in view of above judicial pronouncements, mentioning of a wrong provision i.e. Rule 25 and not mentioning of correct rule 27 does not vitiate the proceedings as the adjudicating authority has power to pass an order which is unquestionably present with the adjudicating authority. Accordingly, we set aside penalty of Rs. 26,74,513/- imposed under Rule 25 read with Section 11AC of the Central Excise Act, 1944 and instead impose a penalty of Rs. 5000/- under Rule 27 of the Central Excise Rules, 2002.

Validity of show cause notices - packing of mini filter pouches and for installation of machines for the manufacture of filter tobacco pillow pouches -manufacture of branded Chewing Tobacco falling under tariff item No.24039910 - HELD THAT:- Respondent reiterated the findings of the impugned order passed by the Commissioner. He further submits that this issue is no more res integra and the Commissioner (Appeals) in their own case for the earlier period vide its order dated 21.04.2011 has allowed the appeal of the respondent and set aside the demand. The said order was challenged by the Revenue before the CESTAT and CESTAT vide its order dated 17.06.2013 dismissed the appeal of the Revenue and the same is reported in the appellant’s own case of Commissioner of C.Ex. Chandigarh Vs. Tej Ram Dharam Paul [2013 (8) TMI 607 - CESTAT NEW DELHI] He further submits that the appeal of the Revenue should be dismissed by following the ratio of the CESTAT decision (cited supra) which has been subsequently accepted by the Revenue and has not appealed against.

We have considered the submissions of both the parties and perused the material on record and the judgment of this Tribunal dated 17.06.2013 vide which the Tribunal has dismissed the appeal of the Revenue on identical issue.; held that " we agree with the lower authorities that the packing machine used for packing of filter khaini pouches/pillows/sachets cannot be considered to be notified item arid the goods manufactured with the aid of packing machine would not be covered under the compounded love rules They are required to discharge duty not in terms under the said Rule, but in terms of us l provisions of law. For the similar reason in the pillow packing machine for the manufacture of the sets would not be taken into consideration for determining the annual capacity of production and collection of duty

By following the ratio of the decisions (cited supra), we are of considered opinion that there is no infirmity in the order passed by the Commissioner and we uphold the same by dismissing both the appeal of the Revenue.

Demand of excise duty along with interest u/s 11AB - equal penalty under Rule 25 - manufacture of various products and are registered with the Central Excise department - deductions on account of post manufacturing expenses (“PME”) such as additional sales tax, octroi and cost of transportation on weighted average basis. - HELD THAT:- After considering the submissions made by both the parties and perusal of the material on record, we find that the issue involved in the present case is no more res integra and has been settled by the Tribunal in favour of the Appellant in their own case for the earlier period [2009 (4) TMI 739 - CESTAT, NEW DELHI], whereby the Tribunal held that deductions on account of PME like octroi, additional sales etc are admissible to the Appellant on weighted average basis. Further, we find that the present proceedings arise on account of subsequent SCNs for subsequent period. We also find that the department has not challenged the Final Order dated 30.04.2009 passed by the Tribunal which means that the department has accepted that order.

Besides this, the issue has also been decided by various benches of the Tribunal in the cases cited supra, wherein it has been held that the assessee is entitled to deductions on account of octroi, sale tax, additional sales tax on weighted average.

Thus, we are of the considered opinion that the impugned order is not sustainable in law, therefore, we set aside the same and allow the appeal of the Appellant with consequential relief, if any, as per law.

Rejection of transaction value - connected/related persons -Undervaluation - admissibility of the statements - Classification of goods - products comprise micro-computer units with microprocessors, storage, interfaces and ability to accept/deliver data to automatic data processing systems, and use proprietary firmware/software - short payment of excise duty - concept of “Inter-connected Undertakings” - extended period of limitation for demands - HELD THAT:- We find that the crux of the issue in the present appeal is based on the finding of the Adjudication Authority that the appellant and buyers of the product M/s. Taurus Powertronics Pvt. Ltd. (TPPL) and M/s. Taurus Powertronics System (TPS), are related to appellant. In this regard, we find that there is no specific clause referred under Section 4(3)(b) read with Section 2(g) of the MRTP Act, 1969 applicable in the present case and the adjudication authority as per the impugned order merely made certain observations that M/s. MKS System has sold the goods to M/s. Taurus Powertronics Pvt. Ltd. (TPPL) and M/s. Taurus Powertronics System (TPS). Though there is no allegation regarding involvement of financial transactions, it is held that they have mutuality of interest.

However, Adjudication Authority has failed to appreciate the factual and legal position that the “proprietary concern” cannot be “inter-connected undertakings” with “partnership Firm” and “Body Corporate”. The concept of “Inter-connected Undertakings” is applicable to Body Corporates. The principle behind the valuation mechanism has to be considered based on the mutuality of interest. There is no allegation regarding flow back of additional consideration from the related party buyer to the manufacturer seller.

As regards reliance of the statement recorded from the Managing Director of M/s. Taurus Powertronics Pvt Ltd., Shri M.N. Ravinarayan, we find that in his statement recorded on 25.09.2017 he has given detailed statement regarding procurement of the goods from other sources than the appellant like hook rods, Pelican cases, Packing materials, Wires, etc., from other suppliers, integrated with microprocessor and supplied to their customers.

Therefore, the price at which the appellant has sold the goods to the buyer and the composite price at which the buyer has further sold the goods and provided various services as narrated above are not comparable. Further, as per the ratio of the profit, the manufacturer should have been gaining less profit than the buyer. However, we find that the profit percentage of the appellant was 22.24%, whereas the buyers alleged as related party was only 5.01%. Therefore, the finding that the appellant and M/s. Taurus Powertronics Pvt. Ltd. (TPPL) and M/s. Taurus Powertronics System (TPS) are interconnected undertaking and relative to invoke Rule 9 and Rule 10 of the Central Excise (Determination of Price of Excisable Goods) Rules, 2000 and Section 11 A (4) / 11A (10) of the CEA, 1944 is unsustainable.

Classification - We find that as per the details furnished by the appellant and following the decision of this Tribunal in the matter of Cascade Systems [2006 (3) TMI 396 - CESTAT, BANGALORE] the equipment manufactured by the appellant are classifiable under CETH 8471. Thus, the finding given the Adjudication Authority regarding classification of goods under CETH 90318220 of the CETA, 1985 is also unsustainable.

Short payment of excise duty - On verification of the value declared in ER-1 Return for March 2017, it is evident that the value considered for the month of March 2017 includes an invoice raised in February 2017 on which duty had been paid in February, itself. Thus, there was no short payment of duty for March 2017 as held by Adjudication Authority.

Invoking the extended period of limitation - Demand is made for the goods cleared from Jan 2013 to June 2017 and the show cause notice (SCN) was issued on 07.04.2018. We find that as per the evidence produced by the appellant, entire documents were audited for the period from Nov 2003 to October 2006 and CERA had audited the records of the appellant on April 2014 and as per Audit Enquiry No. 3 dated 10.04.2014 in the said audit, short payment of duty paid @10.3% instead of 12.36% was informed and appellant paid the said amount.

Moreover, the statement of the proprietor was recorded over a period for years from 20.03.2014 to 08.03.2018. Fact being so, the respondent was aware about the entire transactions and following the ratio of the judgments of the Hon’ble Supreme Court in the matter of Pragathi Concrete Products (P) Ltd [2015 (8) TMI 1053 - SC ORDER], there cannot be any allegation regarding suppression of fact to confirm the demand by invoking the extended period of limitation.

Thus, we find that the impugned order is unsustainable and liable to be set aside.

Entitlement to refund of Central Excise duty - Incidence of duty - Unjust enrichment - pre- and post-payment of duty - documentary evidence to corroborate - Chartered Accountant certificate - HELD THAT:- We find that Tribunal in the case of M/s Dhariwal Industries [2005 (7) TMI 160 - CESTAT, MUMBAI] held categorically that duty is required to be indicated in the invoices in terms of Rule 9 of CENVAT Credit Rules, 2004 and that mere mentioning of duty in the invoices is not in itself a conclusive evidence that the incidence of duty has been passed on; if the prices are kept constant by keeping the profit margin low, it can be said that the incidence of duty has been borne by the appellant and has not been passed on to the customers.

We further find that the Commissioner (Appeals) relied upon the certificate issued by the Chartered Accountant. We find that Revenue in their appeal did not adduce any evidence to arraign the said certificate. Under these circumstances, we find that the certificate issued by a professional, after examining the records of the respondent cannot be brushed aside.

We find that there is merit in the argument of the respondent that nothing in the grounds of appeal points at incorrectness of the certificate issued by the Chartered Accountant. In fact, appellant-revenue has not controverted the certificate. It is trite law that the Chartered Accountant Certificate is one of the sufficient conditions to substantiate that the incidence of duty has not been passed on to the customers; the onus to disprove the Chartered Accountant Certificate is on the Department and the same has not been discharged. The certificate was issued after going through the accounts of the appellants and after satisfying himself about the truthfulness of the same. A certificate given by a professional cannot be dis-regarded unless it is proved to be blatantly wrong and contrary to the facts and evidence available on the hand. Thus, the certificate given by the Chartered Accountant has an evidentiary value and cannot be rejected in an arbitrary manner.

Thus, we find no merit in the appeal filed by the Revenue. Accordingly, the same stands dismissed. The Stay application filed by the Revenue is, accordingly, rejected.

Negotiable Instruments Act, 1881 - Dishonour of cheque -Presentation within the period of its validity under the proviso to Section 138 - Rebuttable presumption -effect of merger/acquisition of drawee bank on cheque validity - presumption u/s 139 and 146 - quashing of criminal proceedings u/s 482 of the Code of Criminal Procedure, 1973 - HELD THAT:- It is pertinent to note that, in the case of Archana Singh Gautam [2024 (6) TMI 1549 - ALLAHABAD HIGH COURT], as well as Gantha Kavitha Devi [2024 (10) TMI 1770 - ANDHRA PRADESH HIGH COURT], the cheques were returned by the drawee bank by making an endorsement which reflected upon the validity of the cheque. In the case of Archana Singh Gautam (supra), the cheque was returned with the remarks, "wrongly delivered not drawn on us" by the Indian Bank, into which the Allahabad Bank had merged. Whereas, in the case of Ganta Kavitha Devi (supra), the cheque was returned with the remarks, "invalid cheque (SBH)". Yet, the process for an offence punishable under Section 138 of the N. I. Act, 1881 was issued in those cases.

The position in law is that, it is the dishonour of the cheque that assumes importance and the reason for dishonour, especially "stop payment", "refer to drawer", "account closed", "exceeds agreement" and the like, are not of decisive significance. This factor also deserves to be kept in view.

In a case of the present nature, however, the reason for the return of the cheque assumes significance. If the cheque is not returned with a specific endorsement that, the cheque is invalid, but on account of insufficiency of funds, then as rightly submitted by Mr. Karia, the presumption contained in Section 146 of the N. I. Act, 1881, comes into play and the onus would shift on the drawer to rebut the presumption that, the dishonour of the cheque was not on account of insufficiency of funds. The presumption contained in Section 146 of the N. I. Act, is also a presumption of law and the Court is enjoined to presume the said fact, as it is a mandatory and not a permissive presumption.

It is true, the Acquisition order issued by the Central Government and the order/circular issued by the RBI, cannot be brushed aside lightly. However, when the cheque is returned with the remarks, "Insufficient Funds", the presumption contained in Section 146 of the N. I. Act, 1881, would be required to be rebutted by demonstrating that, the drawee bank could not have honoured the cheque in question as its period of validity had expired.

The legal position has crystallized to the effect that, even if a blank signed cheque leaf is delivered to the payee, towards debt or liability, and the payee fills in the particulars, the cheque is not rendered invalid and the presumption contained in Section 139 of the N. I. Act, 1881 is attracted.

Therefore, in a situation of the present nature, where the cheques have been returned with the remarks, "funds insufficient", and not on account of alleged invalidity of the cheques, the question as to whether, the cheques were dishonoured for insufficiency of funds becomes a tribal issue and must be adjudicated at the trial. Different High Courts have also adopted similar approach in a variety of fact- situations.

In the case ofM/s. K. K. Tractors & Ors [2023 (2) TMI 1445 - PUNJAB AND HARYANA HIGH COURT] again in the context of the presentation of the cheque, beyond the stipulated period after the merger of the SBI's Associate Bank with State Bank of India, a learned Single Judge declined to quash the complaint opining that, the notifications and documents annexed to the applications under Section 482 of the Code, cannot be considered as evidence so as to quash the complaint in exercise of inherent power.

Though the expression 'within the period of its validity' used in the later part of the clause (a) of the proviso to Section 138 of the N. I. Act, 1881, is elastic enough to cover in its fold a case where the validity of the cheque, is affected by the factors like acquisition by or merger with another bank, despite the validity period specifically mentioned on the cheque not having come to an end, yet, the attendant circumstances bear upon the question whether the cheque has been presented within its validity period. In cases where despite the original drawee bank having ceased to be 'the bank' within the meaning of clause (a) of the said proviso the cheque is returned unencashed with the remarks "insufficiency of funds" and the like, the investigation into facts becomes necessary, and the question whether the drawee bank could have honoured the cheque as it was rendered invalid, would warrant adjudication at the trial. Whereas, in cases where the cheque has been returned with the remarks, 'invalid' or 'presented on the successor bank after the period of the validity of the cheque' and the like, compliance of clause (a) of the proviso to Section 138 of the N. I. Act, 1881, in the matter of presentation of the cheque within the validity period, could be examined by the Court, in the light of the attendant facts and circumstances of the case. No straight- jacket formula that, since the cheque appeared to have been presented after expiry of the period of validity of the cheque drawn on the earstwhile drawee bank, no offence punishable under Section 138of the N. I. Act, is made out, can be adopted.

The facts of the case at hand appear to fall in the category of cases where on account of the return of the cheque with the remarks, "Funds Insufficient", the question as to whether the cheque was presented beyond its validity period warrants adjudication at the trial. Resultantly, the prayer of the applicants to quash the complaints for the offence punishable under Section 138 r/w 141 of the N. I. Act, 1881, cannot be countenanced.

Hence, the applications stand dismissed.

Dishonour of Cheque - Vicarious liability of directors under the Negotiable Instruments Act - liability of independent/non-executive directors - liability of key managerial personnel and Chief Financial Officer (CFO) - protective limitation of liability for independent directors under the Companies Act, 2013 - quashing of summons in proceedings u/s 138 of the Negotiable Instruments Act - HELD THAT:- Section 149(6) Companies Act, 2013 thus, defines that an independent Director is a director who is not a Managing Director, Whole-Time Director, or Nominee Director, and who meets specific criteria related to integrity, expertise, who has / had no pecuniary relationship, other than remuneration as such Director, and independence from the Company’s promoters and Management. An independent director does not hold any security or interest in the Company or its subsidiary or associate company.

Apex Court in the case of K.S. Mehta vs. M/s Morgan Securities and Credits Pvt. Ltd. [2025 (3) TMI 255 - SUPREME COURT], wherein the Complaint lacked specific averments that would have established a direct nexus between the Appellants and the financial transactions in question or demonstrate their involvement in the Company’s financial affairs and the documents on record confirmed the non-executive status of the Appellants/Directors, underscoring their limited role in governance without any Executive decision-making authority. It was held that merely because the Appellants/Directors attended Board Meetings, does not automatically translate into control over financial operations. Hence, unless direct involvement of the Directors is established, they cannot be held vicariously liable under the Act, 1881.

In the present case, the Complaints themselves admit that payments were made to the Accused No. 1 Company, and not to any of the individual Petitioners. In view of aforesaid law and also considering that Petitioner Nos. 1, 3 and 4, namely, Mr. Ashwini Kumar Singh, Ms. Sunita Palta and Mr. Bhagwan Singh Duggal are Non-Executive Directors of the Company, they cannot be held in-charge / responsible for the day of day affairs of the Company. Therefore, Summoning Order dated 03.04.2018 passed Ld. MM in CC No. 9804/2017 is set aside and CC No. 9804/2017 under Section 138 NI Act is quashed against Petitioner Nos. 1, 3 and 4, namely, Mr. Ashwini Kumar Singh, Ms. Sunita Palta and Mr. Bhagwan Singh Duggal.

In so far as Petitioner No. 2, Mr. Darshan Singh Negi is concerned, the position is materially different. It is not disputed that he was the Chief Financial Officer (CFO) of the Accused Company, at the relevant time. The role of a CFO, by its very nature, is intrinsically connected with the financial administration, accounting, and management of monetary transactions of the Company. Unlike Independent or Non-Executive Directors, a CFO forms part of the Key Managerial Personnel and is actively involved in the day-to-day financial affairs of the Company.

Petition is allowed partially and Summoning Order dated 03.04.2018 passed Ld. MM in CC No. 9804/2017 is set aside, and the proceedings under Section 138 NI Act against Petitioner Nos. 1, 3 and 4, namely, Mr. Ashwini Kumar Singh, Ms. Sunita Palta and Mr. Bhagwan Singh Duggal, is quashed.

However, there is no ground to quash the summoning Order against Petitioner No. 2, Mr. Darshan Singh Negi, which is upheld and the Petition viz-a-viz him, is hereby, dismissed.