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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/2015-16/2901

Demand on time barred show cause notice.

Case:- FUTURA FIBRES VERSUS COMMISSIONER OF C. EX., CHENNAI-I
 
Citation:- 2015 (40) S.T.R. 205 (Tri. - Chennai)

 
Brief facts:- These appeals are against demands of Service Tax on “goods transport service” received by the appellants during the period 16-11-1997 to 1-6-1998. In the case of M/s. Futura Fibres (Appellants in Appeal No. S/25/2004), the demand of tax was raised in a show cause notice dated 4-1-2002, while in the case of M/s. Futura Polymers (Appellants in Appeal No. S/28/2004), similar demand was raised in a show cause notice dated 6-12-2001. The original authority confirmed the demands of tax and the first appellate authority sustained the same. Hence, these appeals of the assessee.
 
Appellant’s contention:- Ld. Counsel for the assessees has submitted that, as the subject show cause notices were issued after 12-5-2000 (the date on which the Finance Act, 2000 received Presidential assent), the demands of Service Tax raised therein are hit by the Apex Court’s ruling in Laghu Udyog Bharati v. UOI [1999 (112)E.L.T.365 (S.C.)]. Even otherwise, the demands are barred by limitation prescribed under Section 73 of the Finance Act, 1994. Ld. Counsel has pointed out that an issue similar to the issue arising in these appeals was decided by this bench against the Revenue as per CCE, Chennai v. EID Parry (India) Ltd. Final Order Nos. 930 & 931/2004, dated 20-10-2004 [2004 (117) ECR 670 (T) = 2005 (179)E.L.T.447 (T)].A copy of this final order has been placed on record.
 
Respondent’s contention:-The DR has reiterated the findings in the impugned order.
 
Reasoning of judgment:-After examining the records and hearing both sides, they find that the question to be decided is whether the appellants qua service-receivers were liable for Service Tax during the aforesaid period. On a perusal of the Final Order cited by ld. Counsel, they find that the issue in the instant appeals stands squarely covered in favour of the appellants. The ratio of the decision covered by the cited Final Order is contained in paras 5 & 6 thereof, extracted below :
 
“5. I have carefully considered the submissions. The assessees in both the appeals are recipients of taxable services, namely ‘Clearing and Forwarding’ service and ‘Goods Transport’ Service. In respect of both these services, rules had been framed by Central Government to recover Service Tax from the recipients of service. But these rules were held to be ultra vires Sections 65 and 66 of the Finance Act, 1994 by the Hon’ble Supreme Court in the case of Laghu Udyog Bharati (supra). In order to get over the Supreme Court’s ruling, Parliament amended Section 65 ibid in relation to the limited period 16-7-1997 to 16-10-1998 under Section 116 of the Finance Act, 2000, whereby recipients of ‘Goods Transport’ service and ‘Clearing and Forwarding’ service were defined as “assessees”. Further, for the aforesaid limited period, Parliament declared that “any action taken or anything done or purported to have been (i) taken or done at any time during the period commencing on and from the 16th day of July, 1997 and ending with the day, the Finance Act, 2000 receives the assent of the President shall be deemed to be valid and always to have been valid for all purposes, as validly and effectively taken or done” vide Section 117 of the Finance Act, 2000. Later on, the Finance Act, 2003, made certain amendments to the Service Tax provisions of the Finance Act, 1994, whereby the aforesaid assessees were required to present Tax Returns to the proper officer within six months from 14-5-2003 (date on which the Finance Act, 2003 received Presidential assent). Ld. Counsel has also invited my attention to the legal opinion given by the Additional Legal Advisor to the Government of India. This opinion is to the effect that Service Tax could not be received from the aforementioned service received for the period covered by the amendment where no action was initiated against them for such recovery during such period.
 
6. In the instant case, the demands of Service Tax were raised beyond 12-5-2000 in show cause notices dated 13-5-2002 and 14-2-2003. such demands are not affected by the amendments made to Section 65 by Parliament under Section 116 of the Finance Act, 2000 and consequently they are hit by the Apex Court’s ruling in Laghu Udyog Bharati (supra). Furthermore, undisputedly, the demands raised by the Department, in these cases, are for beyond the period of limitation prescribed under Section 73 of the Finance Act, 1994.”
Following the view taken in CCE, Chennai v. EID Parry (India) Ltd. Final Order Nos. 930 & 931/2004 [2004 (117) ECR 670 (T) = 2005 (179)E.L.T.447 (Tribunal)]ibid, they set aside the impugned order and allow these appeals, with consequential relief, if any.
 
Decision:-Appeals allowed
 
Comment:- The analogy of the case is that as the Service Tax demand was raised beyond the prescribed period of limitation, the same was held to be time barred and the appeal was allowed on limitation alone.
 
Prepared by :- Monika Tak
 

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