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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 Laws/2011-12/1353

Extended period of Limitation - invoking of

Case: KAY KAY PRESS METAL CORPORATION Versus COMMR. OF CEN. EX., VALSAD
 
Citation: 2011 (270) E.L.T. 691 (Tri. - Ahmd.)
 
Issue:- Extended period cannot be invoked when asseessee is under bonafide belief based on Tribunal or Court’s decisions.
 
Brief Facts:- Appellant was undertaking the activities such as cutting, bending, punching on duty paid articles, plates or channels. Revenue alleged that the said activities amounted to manufacture and issued show cause notice in 2003 for the period 1998-1999 to 1999-2000.
 
The Adjudicating Authority confirmed the demand of duty of Rs. 41,04,217/- and impose penalty of identical amount.
 
Hence, appellant is before the Tribunal.
 
Appellant’s Contention:- Appellant have relied upon the Supreme Court judgment in the case of Continental Foundation Jt. Venture v. CCE, Chandigarh [2007 (216) E.L.T. 177 (S.C.)] wherein it was observed that when there is a bona fide doubt as to non-excisability of the goods due to diver­gent views of the Courts, extended period of 5 years cannot be invoked and more failure or negligence in not taking licence or not paying duty, is not suffi­cient to invoke extended period.
 
Reasoning of Judgment:- The Tribunal noted that the issue is no more res integra and stands settled against the appellant on merit by the Larger Bench in the case of Mahindra & Mahindra Ltd. v. CCE, Aurangabad [2005 (190) E.L.T. 301 (Tri.-LB)].
 
The Tribunal observed that though there are certain disputes about the factual position in the present case as to whether the appellant themselves have carried out the processes or they have got it done through job worker, but the present appeal can be disposed off on the point of time bar.
 
It was noted that the period in­volved is 1998-2000, whereas the Show Cause Notice was issued in 2003. During the relevant period, various decisions of the Tribunal were to the effect that such activity of cutting, bending, and punching duty paid articles, plates or channels does not amount to manufacture. It was only subsequently that the matter was referred to Larger Bench in the light of the decision of the Supreme Court in the case of Collr,  CE., Jaipur v. Man Structurals Ltd. [2001 (130) E.L.T. 401 (S.C.)].
 
It was noted that the Larger Bench decision of the Tribunal took notice of the earlier decisions of the Tribunal in the case of Aruna Industries v. Collr., C.E. - 1986 (25) E.L.T. 580 (Tri.) as also many other decisions of Tribunal including the Supreme Court judgment in the case of Wainganga Sahkari S. Karkhana Ltd. v. Commissioner [2002 (50) RLT 177 (Tribunal)], as affirmed by the Supreme Court [2002 (142) E.L.T. 12 (S.C.)].
 
As such, it is clear that during the relevant period, various deci­sions and judgments held the activity as not amounting to manufacture. As such, we are only required to deal with the plea of limitation.
 
The Tribunal noted that the Tribunal's decision in the case of Mahindra & Mahindra Ltd. v. CCE, Aurangabad [2000 (201) E.L.T. 27 (Tri.-Del.)] had the same effect as the judgment relied upon the assessee herein, wherein it was laid down that where the appellant is under bona fide belief that parts of structures are not excisable and such impression of non-excisability prevailed during the material period amongst assesses and officers. Inasmuch as, decisions during the material period were favouring the assessee, the charge of suppression of fact is not sus­tainable and extended period is not invokable. Similarly, reliance was placed on the case of Mail Mark Nun yarn v. CCE, Chennai - 2009 (241) E.L.T. 422 (Tri. - Chennai), it was held that divergent views prevailing on excisability of Shikakai Powder, with differ­ent High Courts having held different views on the issue, the appellants can be said to be under bona fide belief and extended period of limitation cannot be in­voked.
 
It was held that the law on the issue is clear i.e. to the effect that when there are divergent views, many of which are in favour of the assessee holding the field, no suppression or mis-statement can be attributed to the assessee, to entertain the same belief. As admittedly, in the present case, judgment prior to Larger Bench in the case of Mahindra & Mahindra Ltd., were laying that the proc­esses allegedly adopted by the appellant did not amount to manufacture, the tribunal is of the view that the demand raised beyond the period of limitation, by invoking extended period, is barred. As such, irrespective of the fact as to whether the ap­pellants themselves have undertaken the said activity or not, the demand is re­quired to be quashed on the above issue itself.
 
As the Tribunal has already held the demand as barred by limitation and the impugned order is required to be set aside on this ground, the Tribunal finds no justification for impo­sition of penalty on the appellant. The same is also set aside.
 
Decision:- Appeal allowed.
 
Comment:- This decision is clearly bringing the landmark analogy that when a manufacturer has acted on the basis of decisions of tribunal and High Courts and has not paid the duty then the extended period of limitation cannot be invoked. This means that the allegation of willful suppression, fraud etc. with an intent to evade payment of duty cannot be alleged in such cases.

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