TDS under GST: retrospective application raises legal doubts and risks inconsistent enforcement across jurisdictions.
The article argues that while the government can appoint different commencement dates for statutory provisions, it lacks clear power to make substantive GST provisions retrospectively applicable; many state notifications nevertheless adopt retrospective effective dates for TDS, producing legal uncertainty and compliance burdens absent explicit legislative authority and synchronised commencement. (AI Summary)

Amendment of non existent notification creates confusion over customs exemptions for passenger import of gold and silver.
An amendment provision in a customs notification attempted to modify Notification No. 172/1994, but that notification had already been superseded and its successor rescinded; the operative exemptions for passenger import of gold and silver are instead contained in the consolidated Mega Exemption Notification, creating an inconsistency that warrants a corrigendum or clarification to avoid compliance confusion. (AI Summary)

Retrospective amendment to service tax valuation requires payment on construction contracts involving land, subject to limitation defences.
Section 129 of the Finance Act, 2017 and the Sixth Schedule retrospectively amend rule 2A to provide that the value of the service portion in a works contract involving transfer of land excludes the value of the land transferred. A deeming provision treats actions taken during the retrospective period as validly done as if the amendment had always been in force, creating potential retrospective service tax liability for builders while leaving room for limitation-based defences where show-cause notices were not issued. (AI Summary)

Mandatory GST registration may obligate previously registered dealers to retain provisional registration despite qualifying for threshold exemption.
Section 22(2) mandates that persons registered under existing laws immediately before the appointed day be registered under GST, producing automatic provisional migration; coupled with limited statutory grounds for cancellation and system based migration processes, this creates ambiguity for taxpayers whose turnover falls below the GST exemption threshold and may impede surrender or cancellation of provisional registrations without clear administrative clarification. (AI Summary)

Voluntary declaration scheme imposes increased tax, surcharge and penalty and mandates a locked deposit under the new investment regime.
The Taxation and Investment Regime for Pradhan Mantri Garib Kalyan Yojana, 2016 requires declaration of undisclosed deposits with payment of tax (30%), surcharge on that tax, and a 10% penalty on declared income payable before filing; 25% of the declared income must be deposited in a four year, non interest locked deposit scheme. Payments are non refundable, false declarations or non payment void the declaration, deductions are disallowed, immunity is limited to income tax, and the scheme excludes specified criminal prosecutions and undisclosed foreign income under the Black Money Act. (AI Summary)

Cost accounting periodicity: annual audited-cost basis governs valuation for excise on captive transfers per ICAI guidance
The dispute concerns whether costing for valuation of intermediate products for captive use must be computed on an annual audited accounts basis under CAS 4 or may reflect intra year revisions. ICAI guidance requires cost determination for a defined period reconciled with audited accounts, and a tribunal held that annual audited costing is the correct method for CAS 4 valuation, cautioning against selectively applying annual cost only to months with lower provisional values when quantifying differential duty. (AI Summary)

Cost of improvement: reliance on cash flow and probability allows partial acceptance of undocumented construction expenses.
Determination of cost of improvement for long term capital gains on sale of old or inherited land/building depends on evidence; absent documentary proof, tribunals may restrict unsupported claims but can accept detailed year wise cash flow and source explanations, applying an estimated disallowance to account for defects and thereby allow partial acceptance of claimed improvement costs based on probability and reasonable certainty. (AI Summary)

Interest under statutory interest provision: no interest where duty paid promptly after remand adjudication determination.
Interest liability arises from the date of determination under the statutory interest provision; when a Tribunal upholds duty but remands for fresh quantification, the original adjudication ceases to be operative and the post-remand adjudicating authority's order is the relevant date for calculating interest. Explanatory provisions excluding periods do not apply where the appellate process did not alter liability, and if duty is paid without delay after the remand adjudication, interest is not justified. (AI Summary)

Coerced surrender of income: declarations under duress can negate tax liability and prompt refund scrutiny.
Whether taxes paid on income surrendered during survey can be treated as not leviable where the surrender was made under compulsion is the central issue. The tribunal emphasized that a statement obtained under coercion or duress does not conclusively establish undisclosed income, and that factual indicators such as fear, reliance on loose paper figures, and subsequent appeal are relevant to voluntariness. It treated taxes paid on compelled disclosures as not exigible for the alleged additional income and directed the department to address taxes paid in consequence of those survey disclosures. (AI Summary)

Power to conduct audits under Rule 5A(2) remains contested but currently enables revenue audits pending final judicial resolution.
The validity of Rule 5A(2) of the Service Tax Rules is contested as exceeding the rule making power by enabling general audits beyond statutory special audit conditions; High Courts struck it down as ultra vires, but stays by the higher forum have permitted continued use of Rule 5A(2) for departmental audits and consequent demands pending final adjudication. (AI Summary)

Application of income: purchase of capital assets can qualify as application, but amendment bars duplicate depreciation benefit.
Interpretation of clause a of section eleven: income from property is to be computed under the Act's normal principles, and application of income (including purchase of a capital asset) is a use of computed income rather than a separate computation. Courts have allowed treating capital acquisition as application of income, with corresponding treatment of depreciation write backs, but Parliament has amended the law to preclude deductions or allowances for depreciation in respect of assets whose acquisition has been claimed as application of income in the same or any earlier year. (AI Summary)

Relevant date for duty demands: limitation must follow statutory reckoning, not merely date of departmental knowledge.
The principal issue is whether limitation for demands under Section 11A of the Central Excise Act and the Service Tax provision is measured from the department's date of knowledge of clandestine diversion or from the statutory relevant date. The Supreme Court has held that where clandestine removal is discovered, limitation may be computed from the date knowledge arises; a tribunal applied that view after investigations and admissions. A High Court has held instead that statutory recovery must obey the relevant date in Section 11A/Section 73, and not be extended merely because of departmental knowledge, though remedies under general law remain available. (AI Summary)

Service tax audit: must be performed by qualified chartered or cost accountants; taxpayers must provide records on demand.
The High Court upheld that assessees must, on demand, furnish records, trial balance and any income tax audit report to an authorised officer or audit party; material for audit may be collected by an authorised officer or the appointed auditor, but the audit must be performed by a qualified Chartered Accountant or Cost Accountant, the final audit report is submitted to the Commissioner and provided to the assessee, and the Commissioner must record reasons before directing a special audit. (AI Summary)

Penalty under Section 271(1)(c) requires discernible conditions in the assessment order before initiating penalty proceedings.
Penalty under the Income Tax penalty provision for concealment or furnishing incorrect particulars is a civil liability not dependent on mens rea; initiation and imposition require conditions triggering penalty to be discernible from the assessment or appellate/revisional orders or a clear statutory direction, and deeming provisions do not apply to orders of the Commissioner of Appeals or the Commissioner. Penalty proceedings are distinct from assessment proceedings, notices must specify the precise ground, and generic forms or ambiguous directions offend natural justice. (AI Summary)

Voluntary compliance amnesty: declarations can secure immunity from interest and penalties if accepted, subject to narrow procedural exceptions.
The Voluntary Compliance Encouragement Scheme allows eligible persons to declare past service tax dues and, if accepted by the designated authority, obtain immunity from interest, penalty and other proceedings. Declarations are barred where returns disclosing liability were filed or where notices/orders were issued before the cut-off; however, if an inquiry, search, summons, production requirement or audit was pending at cut-off, the designated authority may reject the declaration by a reasoned written order. Accepted declarations are final subject to limited statutory exceptions, creating potential procedural ambiguities requiring clarification. (AI Summary)

Service tax valuation options expanded with composite rates and clarified inclusions, affecting works contracts and catering services.
Rule 2A permits valuation of taxable services either on net value after deducting goods or by adopting prescribed composite rates across categories; composite bases are specified for original works, maintenance/repair/servicing of goods, and other works contracts. Rule 2C prescribes separate composition bases for restaurant and outdoor catering. Amendments refine valuation where value is not ascertainable, specify inclusions (e.g., demurrage) and exclusions (e.g., interest on delayed payments, government passenger taxes, unrelated accidental damages, unrelated subsidies), and delete the former rule on actual consideration for services from outside India. (AI Summary)

Deemed export benefit restriction may exclude supplies to non-mega power projects, prompting urgent need for policy clarification.
Amendments to Chapter 8 of the Foreign Trade Policy now deny deemed export benefits for supplies to non mega power projects; paragraph 8.7 expressly bars any deemed export benefit for such supplies, and its broad drafting creates uncertainty as to whether the exclusion extends beyond the previously targeted sub category under the Advance Authorisation provisions, necessitating a prompt clarification of legislative intent. (AI Summary)

Deemed value abatement updated for specified services; new CENVAT credit restrictions and sector-specific valuation rules introduced.
Budget 2012-2013 sets sector-specific deemed value abatement percentages to determine taxable value for service tax across services such as leasing, rail and air passenger transport, goods transport, catering, hotels, vehicle rentals, chit services and tour operators. The notification pairs each abatement rate with conditions limiting or disallowing CENVAT credit in specified cases and includes exemptions for low-value consignments for goods transport agencies, thereby creating tailored valuation and credit rules for compliance. (AI Summary)

Service tax valuation changes expand composition scheme and set prescribed valuation percentages for works and food services.
Budgetary amendments to the Service Tax (Determination of Value) Rules, 2006 merge the Works Contract composition scheme into Rule 2A and adjust composition rates with specified effective rates by contract type; retain the Rule 2A valuation method; introduce Rule 2C prescribing valuation percentages for restaurant and outdoor catering services; amend Rule 3 wording where value is not ascertainable; revise Rule 5's explanatory reference to telecommunication service; include demurrage and analogous charges in Rule 6(1); clarify exclusions in Rule 6(2) regarding interest on deposits and delayed payment interest; and omit Rule 7 on services from outside India. (AI Summary)

Cenvat credit expansion restores and broadens input tax credits, extends motor vehicle and service credits and adjusts refund rules.
Amendments broaden Cenvat Credit eligibility by allowing credit on many motor vehicles and their parts, recognising service-tax credits for renting/hiring, insurance and repairs for specified recipients, permitting credit for inputs/capital goods located outside premises with documentation, and extending challan-based credit to all reverse-charge recipients. Export refunds of unutilised credit are calculated by export-to-total turnover ratio without detailed input-service correlation. The payable amount on removal of used capital goods is the higher of adjusted credit-based sum or duty on transaction value. Blocked credit rates for exempt activities are increased, life-insurance credit restriction removed, input service distribution tied to actual use, SAD credit transferability allowed, and interest liability on wrong credits clarified. (AI Summary)