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Corporate News *  Missing seized records must be considered while testing ITC claim; duplicate GST demands ordered corrected: Delhi High Court. *  GST appeal can’t be rejected without addressing taxpayer’s grounds: Allahabad High Court. *  Surplus IGST credit can offset CGST, SGST shortfall: GSTAT. *  GST refund can’t be denied when cancelled airfares are returned with tax: GSTAT. *  3 Hearing notices issued within 2 minutes: Gujarat High Court flags portal flaw, seeks report. *  GSTR-9, GSTR-9C filing for FY 2025-26 enabled; pending GSTR-1 and GSTR-3B must be filed first. *  Dupattas are exempt fabrics, can’t be taxed as fibres at 4%: Madras High Court. *  Full transitional credit allowed on capital goods received after GST rollout: GSTAT denies Rs. 6.99 lakh export duty credit. *  GST return mismatch alone can’t justify fraud proceedings: GSTAT orders fresh adjudication under section 73. *  Supplier found non-existent later can’t alone justify input tax credit denial: GSTAT. *  GST interest stops once tax reaches government account, can’t run until return filing: GSTAT. *  Cancelled flat booking- GST refund can’t be denied without excluding COVID period from limitation: GSTAT. *  India notifies rules of origin for India–New Zealand FTA. *  Incomplete E-bike kits classifiable as complete vehicles, but not eligible for CKD duty concession: CESTAT. *  Same GST rate on main input and output can’t by itself bar inverted duty refund: GSTAT. *  Unjust enrichment doesn’t apply to customs refunds from assessments finalised before July 13, 2006: Gujarat High Court. *  CENVAT credit can’t be denied solely because plant And machinery are embedded in earth: Karnataka High Court. *  DFIA exports ineligible for RoDTEP benefits; customs directs repayment with applicable interest. *  Second E-Way bill alone doesn’t prove another supply: GSTAT. *  Bail denied in Rs. 1.19 crore fake GST refund case over risk of accused absconding again: Punjab and Haryana High Court. *  GST registration can be restored after revocation deadline if outstanding dues are paid: Gauhati High Court. *  Multiple GST proceedings over same suppliers: Calcutta High Court directs dept. to share findings for adjudication. *  E-Governance portal services not OIDAR, fixed deposit interest not taxable: CESTAT. *  Rs. 500 Stamp duty required on authority letters for CAs, CMA and GST practitioners in Pune GST division.  *  Rs. 1.10 crore GST refund must be paid in cash after business closure: Allahabad High Court. *  Godown rent attracts 18% GST even when used exclusively for exempt agricultural warehousing: AAR. *  GST portal launches "Multi-State Registration" facility: one master TRN for registration applications across multiple States/UTs. *  RoDTEP scheme extended till 31st December, 2026.  *  Mere disagreement with order can’t override Rs. 20 lakh appeal limit: GSTAT. *  Customs interest can’t be backdated before confiscation liability is determined; nearly 8 year period excluded: Delhi High Court.
Subject News *  GST summons: anticipatory bail maintainable without arrest order, but relief denied in evasion case: Allahabad High Court. *  GST Appeal can’t be decided without hearing taxpayer’s objections to fresh evidence: Allahabad High Court. *  GST ITC can’t be reversed merely because supplier grants discount without reducing tax liability: GSTAT. *  Mere quoting of GST provision is not a valid charge: GSTAT quashes ITC denial. *  Personal hearing mandatory before adverse GST order, even without taxpayer’s request: Rajasthan High Court. *  Parallel bail pleas without full disclosure amount to abuse of process Rs. 43.08 crore GST case sent for fresh hearing: Supreme Court. *  GST refund based on unchallenged advance ruling can’t be recovered using later circular: GSTAT. *  Payment of GST alone doesn’t end interest and penalty liability when tax and interest remain unpaid beyond 30 days of notice: GSTAT. *  GST demand over builders’ 80% procurement rule requires reasoned adjudication: GSTAT. *  Eligible ITC doesn’t automatically entitle taxpayers to compensation cess refund on domestic sales: GSTAT. *  GST confiscation order passed before reply deadline invalid: GSTAT. *  GST interest can’t be retained after tax refund on delayed export receipts: Punjab & Haryana High Court. *  GST appeal can’t be dismissed over pre-deposit shortfall without opportunity To respond: Bombay High Court. *  DGGI SCN can’t be challenged before reply and adjudication:Chhattisgarh High Court. *  GST input tax credit can’t be denied solely due to supplier’s retrospective registration cancellation: GSTAT. *  GST notice must explain fraud allegations; merely repeating section 74 Is not enough:  Himachal Pradesh High Court. *  Audit detection alone can’t justify GST fraud penalty; specific suppression must be proved: GSTAT. *  GST order uploaded only under ‘Additional Notices’ tab without separate intimation set aside: Calcutta High Court. *  Service Tax appeal can’t be rejected for missing pre-deposit proof when payment is already recorded: CESTAT. *  SGST dept. can’t hear appeal against CGST order: Calcutta High Court. *  Mere dispatch of tax order can’t prove service or make appeal time-barred: CESTAT. *  Dealer incentives can’t be taxed merely on ledger entries: CESTAT. *  DGFT orders quashed for failure to supply DRI letter relied upon in SCN: Bombay High Court. *  GST penalty u/s 122(1A) can’t apply to Pre-2021 transactions; unregistered beneficiaries also covered: Delhi High Court. *  Expired E-way bill caused by wrong PIN code can’t justify GST penalty without intent to evade tax: GSTAT. *  Used railway rails can’t be taxed as track material without proof they are fit for reuse: CESTAT. *  Earlier DGGI notice doesn’t bar separate GST demand on different issue: Delhi High Court. *  ITC dispute involves no question of law: GSTAT directs appeal to Vice-President. *  Earlier DGGI notice doesn’t bar separate GST demand On different issue: Delhi High Court. *  No E-way bill required for interstate goods movement in november 2017: GSTAT quashes detention and penalty.  

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PJ/Case Law/2019-2020/3540

AEGIS LIMITED 2019 (27) G.S.T.L. 225 (Tri. - Hyd.)
Case:  AEGIS LIMITED
Citation:2019 (27) G.S.T.L. 225 (Tri. - Hyd.)
Issue:1.Appellant AGEIS LIMITED (resultingcompany) availed unutilized CENVAT credit of BPO division of M/s. Global Vantedge Pvt. Ltd. (demerged company)   which merged into AEGIS LIMITED after getting approval from high court. Whether such credit is allowable or not under Rule 10 of Cenvat Credit Rules,2004?
2.The Appellant availed wrong amount of credit as the amount of credit in ST-3 was less than the amount of credit which has been availed by the Appellant.
Brief Facts:The demerger from the parent company and merger with the appellant was by virtue of the orders of the Hon’ble High Courts. Between the appointed date and effective date i.e., from 1-4-2007 to 4-4-2008 M/s. Global was to carry on the business activities in the normal course of business for and on account of and in trust of the appellant company.
Respondent’s Contention and Jugdement :
Issue no. 1:Rule 10(2) of CCR, 2004 squarely covers such cases also.The companymay decide to sell one of its businesses to another firm. In such cases, the business which has been sold gets demerged from the parent company and merges with the buyer company.In this case, we find that Para 1.1.6.3 of the merger agreement specifically covers transfer of all assets and liabilities to the new entity including the Cenvat benefits. This agreement has been approved by the Hon’ble High Court and therefore is final unless such agreement is reversed by a higher judicial forum. Under these circumstances, no force in the argument in the show cause notice states that the transfer of the benefits under Rule 10 of the CCR, 2004 would apply only if the entire business is sold and does not apply if the seller company sells only one of this businesses (in this case, the BPO Division).
Issue No. 2:M/s. Global had not taken Cenvat credit of the input service utilized by their BPO division as it was decided to sell the same to the appellant. The BPO division also did not take Cenvat credit because they did not need credit because they were engaged only in export of services which did not require utilization of this Cenvat credit. The second component of credit availed by the appellant pertains to the input services which were used by them to render output services from 1-4-2007 onwards. The ST-3 returns filed by the appellant disclose the amount of Cenvat credit availed. The returns do not require invoice of the details of the Cenvat credit availed to be provided in order to the copies of the invoices to be submitted along with the returns. Further in respect of second question Tribunal decided that there was sufficient balance in the account of M/s. Global in their ST-3 returns as on 31-3-2008 and therefore the credit availed by the appellant is justified .
Decision:The appeal is allowed and the impugned order is set aside.
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