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Corporate News *  Service tax penalty can’t survive when assessee acted on dept.’s own view of non-taxability: Delhi High Court. *  GST section 74 extended limitation questionable when form 26AS mismatch was already known: Karnataka High Court grants interim relief. *  CGST demand prima facie impermissible after state GST settlement under section 128A: Bombay High Court. *  Supreme Court asks GSTAT to sympathetically consider delay as taxpayers pursued remedy before wrong forum. *  Supreme Court stays Tripura High Court ruling protecting genuine buyers from ITC denial over supplier’s GST default. *  Diary entries alone can’t prove clandestine removal of goods: CESTAT quashes excise penalty on steel trader. *  Customs could investigate preferential tariff claims even before sec. 28DA: Delhi High Court. *  Customs dept. relied on fake AI generated case laws: supreme court quashes Rs. 425.28 crore penalty. *  No GST exemption in affiliation and annual registration charges for admission or conduct Of examinations: GSTAT. *  Mere invoices, cheque payments insufficient to establish genuine movement of goods: GSTAT restores Rs. 43.44 lakh ITC demand. *  Consolidated GST show cause notice covering multiple financial years is not without jurisdiction: Delhi High Court. *  Construction of independent houses on separate plots not taxable as ‘Residential Complex’ without common facilities: CESTAT. *  GST penalty exceeding statutory maximum unsustainable; Allahabad High Court quashes ? 50,000/- penalty after taxpayer filed return and paid late fee. *  GST order against standard chartered bank passed without hearing set aside by Bombay High Court. *  Retracted statements can’t be relied upon without cross-examination: CESTAT quashes gold confiscation. *  Burden to prove misclassification lies on customs department: CESTAT. *  CESTAT quashes Rs. 98 lakh excise demand on clearance of used refractory brick scrap. *  Service tax demand on irrigation works quashed: Karnataka High Court rules sale of goods component not taxable as service. *  GSTAT restores tax and penalty for transporting iron scrap without E-way bill citing intent to evade tax. *  Madras High Court stays GST recovery from directors without opportunity to show cause under section 89. *  Madras high court stays GST recovery notice against directors; finds prima facie case on applicability of section 79(1)(c). *  Procedural lapses can’t justify harsh punishment without serious customs breach: CESTAT quashes customs broker licence revocation. *  Service tax payable on land leasing and sports complex charges: CESTAT. *  Settled customs dispute can’t be reopened through Article 226 challenge to interest liability: Delhi High Court. *  Mere facilitation of customs clearance can’t establish knowledge of smuggling: Madras High Court. *  GST registration cancellation stayed: Allahabad High Court questions 99% ITC utilisation cap under rule 86B. *  Composition scheme lapses automatically on crossing Rs. 1.5 crore turnover: GSTAT. *  Gujarat High Court quashes GST cancellation orders after officer relied on non-existent AI-generated case laws. *  Importers liable for customs duty benefits availed through manipulated scrips: Delhi High Court. *  Procedural E-way bill lapse alone can’t justify penalty where genuine transaction and absence of tax evasion are established: GSTAT.
Subject News *  Documentary evidence dominates probe, further custody unwarranted: mumbai court grants bail in Rs. 22.44 crore customs duty evasion case. *  Business premises can’t remain sealed for non-participation in GST search: Allahabad High Court. *  GST pre-deposit must be refunded proportionately when taxpayer partly succeeds in appeal: Bombay High Court. *  Supreme Court grants 30 days to file GST appeal; keeps pre-deposit issue open due to deposit in parallel CGST proceedings. *  GST demand can’t exceed amount proposed in SCN: Allahabad High Court quashes Rs. 20.47 Crore order. *  Hundreds-of-crores GST demand and heavy 10% pre-deposit no ground to bypass statutory appeal: Punjab & Haryana High Court. *  Delhi High Court refuses to entertain challenge to gold confiscation due to statutory appeal remedy and unexplained delay. *  Procedural error in customs broker licence inquiry can be rectified through remand: Delhi High Court. *  GSTR-2A mismatch alone can’t justify ITC denial without invoice-wise verification; personal hearing mandatory: GSTAT. *  GST order passed without uploading personal hearing notices violates sec. 75(4): Allahabad High Court. *  TAX EVASION - Sec. 74 GST SCN quashed for not spelling out fraud, wilful misstatement or suppression: Allahabad High Court. *  STPI’s SOFTEX certification and NoC charges taxable as business support services: CESTAT. *  Suspicion can’t replace proof: CESTAT quashes penalty in alleged gold-smuggling operation. *   Limitation runs from communication of order: Madras High Court upholds rejection of delayed GST Appeals. *  Rajasthan High Court quashes GST demand over unsigned show cause notice. *  ITC recovery upheld where supplier failed to deposit GST: Rajasthan High Court. *  Customs commissioner’s empowered to make port trust liable for duty on pilfered goods: Supreme Court. *  Rectification proceedings can’t be used to challenge an uncontested GST assessment through a writ petition: Andhra Pradesh HC. *  GST proceedings against deceased proprietor unsustainable without notice to legal heir: GSTAT. *  Mere availment of ineligible self-assessed ITC doesn’t amount to suppression without evidence of fraud or wilful misstatement: GSTAT. *  Disposal of mining overburden by entity authorised by mining lease holder constitutes taxable service: CESTAT. *  Toll plaza data not mandatory for ITC refund: GSTAT. *  Disputed GST fraud allegations require investigation: Punjab and Haryana High Court makes interim bail absolute in alleged fraud and GST fraud case. *  Non-manufacturer contractor liable to deposit excess excise duty collected from buyer: CESTAT. *  GST order can’t reject taxpayer’s reply as “not satisfactory” without reasons: Madhya Pradesh High Court. *  Uncorroborated statements can’t establish alleged diversion of duty-free goods: CESTAT. *  Erection services were not liable to service tax prior to 10th september 2004: CESTAT. *  Sec. 74 GST notice must spell out statutory ingredients for invoking extended tax demand proceedings: Allahabad High Court. *  No jurisdictional bar under section 6(2)(b) in parallel CGST SGST proceedings: Delhi High Court refuses to bypass GST appeal remedy. *  Madras High Court remits GST demand for fresh adjudication after taxpayer claims it was unaware of SCN following business closure.  

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GST Update No 298 on cancellation order uploaded without signature

GST Update No 298 on cancellation order uploaded without signature
Time and again, the revenue authorities are bashed by the Court of law for not following the adequate procedure of law and acting judiciously. Further, the negligence on the part of tax officers in serving the notice properly increases the miseries of the taxpayers. This lacuna on the part of departmental officers is never taken seriously because of which the battle of litigation is faced by the business communities. Recently, one more case on the same lines was reported before Bombay High Court in the case of RAMANI SUCHIT MALUSHTE V/S UNION OF INDIA AND ORS. The decision imparted in this case is the subject matter of discussion of our present update.
 
The petitioner’s appeal was dismissed on the grounds that the appeal was not preferred within a period of 3 months as prescribed under Section 107 of CGST Act, 2017. Therefore, the aggrieved person can prefer an appeal to the Appellate Authority within 3 months from the date of communication of the order. Further, as per Chapter III of the Rules, it requires the order to be authenticated by digital signature or E-signature or by any other mode of signature. The form requires the order to be signed by the officer before passing the order.
 
The petitioner submitted that the order is merely uploaded on the GST Portal without any signature. The signature was affixed on 19.05.2021 when the petitioner was required to get it attested for filing of appeal. Therefore, the limitation period for filing the appeal against cancellation order dated 14.11.2019 never initiated. The limitation period shall begin only from 19.05.2021.
 
The respondent not denied that any order passed by respondent requires to be digitally signed and certified. It was further argued that the petitioner cannot take stand of not receiving the signed copy because the unsigned order was received by petitioner electronically.
 
The Court held that in the present case the present order is not digitally signed and hence, is not issued as per Rule 26 of CGST Rules, 2017. Therefore, the time limit of filing of appeal shall begin only when the digitally signed order is available. It was stated that the if the arguments of the respondent are considered, then the rules which prescribe specifically that digital signature has to be put will be rendered redundant. However, if the digital signature is not affixed by the issuing authority, then the order will have no effect in the eyes of law. Therefore, the submissions of petitioner were accepted that the period of limitation shall commence from 14.11.2019. The impugned order was quashed and set aside and the case was remanded back to be decided on the merits.
 
The above decision is yet another example showcasing that negligence on the part of departmental officers can result into heavy litigation cost to the taxpayers. Recently, there had been judicial rulings wherein the notice was not served on the GST portal or on e-mail of the registered persons. To illustrate, in the case of NAVYA FOODS (P) LTD. V/S SUPERINTENDENT OF CENTRAL TAX, ANDHRA PRADESH HIGH COURT, it was held that time period to file appeal starts from date of uploading of order. We have also prepared update on the same having serial No. 296 dated 28.09.2022. Similar decision was also delivered in the case of M/S PEE BEE ENTERPRISES V/S ASSISTANT COMMISSIONER BY KERALA HIGH COURT on which we have prepared update 124/2020-21 dated 27.8.2020. It is high time that the revenue authorities should streamline the process of adjudication and issuing of show cause notice adequately so as to avoid any unwanted litigations.
 
 
 
 
 
 
 
 
 
 
 
 
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