Chartered Accountant
Bookmark and Share
click here to subscribe our newsletter
 
 
Corporate News *   CBIC issues draft rules for Customs valuation *  Top Headlines: Threshold for Benami deals, green bond investors, and more *  Govt aims 1-hour clearance for goods at all ports *  Exporters Allowed To Use RoDTEP, RoSCTL Scrips To Pay Customs Duty, Transfer Them; Rules Amended *  Millions of labourers to be affected by brick producers’ strike over hike in GST, coal rates *  Inauguration of ‘kendriya GST parisar’ *  Transporter can seek Release of Conveyance alone, not Goods under GST Act: Madras HC *  GST: Quoting of DIN Mandatory for Responding to Notice, Govt Modifies Portal *  Firms can soon file claims for GST credits of ?400 cr *  CBIC issues modalities for filing transitional credit under GST. *  Mumbai: Man creates 36 fake GST firms, arrested for input tax credit fraud of Rs 23 cr *  Report to restructure Commerce Ministry under study; idea is to set up trade promotion body: Goyal *  Firms can soon file claims for GST credits of ?400 cr *  Gambling Alert! Govt May Levy Up To 28% GST; UP, Bengal Back Move *  EPFO backs raising retirement age to ease pressure on pension funds *  India Moving Up Power Scale, Set to Become Third Largest Economy By 2030 *  Airfares Get Expensive: What Changes for Flyers From Today? *  IRCTC Latest News: Passengers to Pay More For Cancelling Confirmed Rail Tickets Soon. *  IBC prevails over Customs Act, says Supreme Court. *  As GST enters sixth year, a time for evaluation and reassessment *  There’s GST on daily essentials as Centre needs money to buy MLAs: Arvind Kejriwal *  Now, GST on cancellation of confirmed train tickets, hotel bookings *  GST kitty for top States could rise 20% in FY23, says Crisil *  French customs officials seize another cargo vessel over Russia sanctions *  TradeLens builds on Asia momentum with Pakistan Customs deal *  Hike tax on tobacco, reduce affordability & increase revenue: Civil society organizations to GST council *  Bihar: ?10 crore tax evasion on tobacco products detected in raids *  Centre failed on GST, COVID; would it be anti-national? Rajan on Infosys row *  Service Tax not Chargeable on Income Tax TDS portion paid by recipient: CESTAT grants relief to TVS *  Foreign portfolio investors make net investment of Rs 7575cr in Sep so far
Subject News *  Run-up to Budget: Monetary threshold for GST offences may rise to Rs 25 cr *   GST (Tax) E-invoice Must For Businesses With Over Rs 5 Crore Annual Turnover *   Both Central GST and excise duty can be imposed on tobacco, rules Karnataka high court *   CBIC Issues Clarification On Extended Timelines For GST Compliance *   CBIC Issues Clarification On Extended Timelines For GST Compliance *  Budget 2023- 9.6 crore gas connections *  GST: Tamil Nadu Issues Instructions for Assessment and Adjudication Proceedings *  GST: CBIC Extends Last Date for filing of ITC *  GST collection in September surpasses Rs 1.4 lakh crore for straight seventh time *  Dollar smuggling case: Customs chargesheet names M Sivasankar as key conspirator. *  Hike in GST rates fuels inflation *  Assam: CBI arrests GST commissioner in Guwahati *  GST fraud worth ?824cr by 15 insurance Cos detected *  India proposes 15% customs duties on 22 items imported from UK *  Decriminalising certain offences under GST on cards *  Surge in GST collections more due to higher inflation: India Ratings *  MNRE Notifies BCD and Hike in GST Rates as ‘Change in Law’ Events But With a Condition | Mercom India *   Solar projects awarded before customs duty change allowed cost pass-through *  Rajasthan High Court Dismisses Writ Petitions Challenging Levy Of GST On Royalty *   GST revenue in September likely at Rs 1.45 lakh crore *  Govt working on decriminalising certain offences under GST, lower compounding charge *  Building an institution like GST Council takes time, trashing is easy: Sitharaman *  GST collections in Sept may touch ?1.5 lakh crore *  KTR asks Centre to withdraw GST on handlooms *  After Gameskraft, More Online Gaming Startups To Receive GST Tax Claims *  Madras HC: AAR Application Filed Under VAT Does Not Survive After GST Enactment *  Threshold for criminal offences under GST law may be raised *  Bengaluru: Gaming company faces biggest GST notice of Rs 21,000 crore *  CBIC clarifies Classification of Cranes for GST, Customs Duty *  Customs seize gold hidden in bicycle in Kerala airport  

Comments

Print   |    |  Comment

PJ/CASE LAW/2015-16/2803

In the absence of any documentary evidence ,whether the cum tax benefit be granted to the assessee and whether the reduction of penalty below minimum limit is sustainable in law?

Case-COMMISSIONER OF C. EX., AURANGABAD VersusRUDRA GALAXY CHANNEL LTD.

Citation-2015 (38) S.T.R. 445 (Tri. - Mumbai)

Brief Facts-Vide the impugned order, the ld. Commissioner while confirming the demand of Rs. 11,23,798/- along with interest thereon for the period 1-11-2004 to 30-9-2005 on the appellant, M/s. Rudra Galaxy Channel Ltd. has reduced the penalty imposed on the appellant to Rs. 4,50,000/-. The appellant, M/s. Rudra Galaxy Channel Ltd. are aggrieved of the said order on two grounds. The first ground taken is that though they are not disputing the tax liability, the consideration received should be treated as cum tax. The second ground taken is that the penalty should be waived.

Appelants Contention-The Revenue has also come up with appeal against the said order on the ground that reduction of penalty to Rs. 4.5 lakhs by the appellate authority is incorrect in law. Inasmuch as the minimum penalty imposable was equal to the tax demand confirmed and the maximum amount of penalty imposable was twice the amount of tax demand confirmed, there is no discretion given to the lower appellate authority to reduce the penalty below the minimum limit prescribed in the law. The ld. AR appearing for the Revenue submits that the reduction in penalty by the lower appellate authority is incorrect in law and relies on the decision of the Hon’ble High Court of the Rajasthan in the case of UOI v. Shiv Ratan Advertisers [2008 (12)S.T.R.690 (Raj.)] wherein it was held that penalty is not reducible below the minimum prescribed. As regards, the abatement towards the Service Tax from the total consideration received, the ld. Additional Commissioner (AR) submits that there is nothing on record to show that the appellant had collected the consideration inclusive of Service Tax and there is no documentary evidence to support this claim. Therefore, in view of the decision of the Hon’ble Apex Court in the case of Amrit Agro Industries Ltd. v. CCE, Ghaziabad - 2007 (210)E.L.T.183 (S.C.) the appellant is not entitled for the benefit of cum tax value.

Respondents Contention-When the case came up for hearing earlier on 21-6-2013, then also none appeared; thereafter the case was adjourned to 13-8-2013, 19-9-2013, 31-10-2013 and finally today. Today is the fifth time the appeal is coming up for hearing and none appeared for the appellant. Therefore, we take up the appeal for consideration and disposal as a number of opportunities has provided to the appellant for defending his case which he has not availed.
 
Reasoning Of Judgement-The tribunal have considered the submission made by the ld. AR and perused the records.From the appeal memorandum it is evident that the appellant is not disputing the tax liability. However, he is seeking abatement towards the tax from the total consideration received; however, there is no documentary evidence available on record to show that the amount received by the appellant was cum tax. In the absence of such a documentary evidence it is difficult to accept the submission of the appellant that consideration received should be treated as cum tax. In the Amrit Agro Industries Ltd. case (supra) the Hon’ble Apex Court held that unless it is shown by the manufacturer that price of goods includes excise duty payable by him, no question of exclusion of duty element from price will arise for determination of value. Thus, in the absence of any documentary evidence, cum tax benefit cannot be granted to the appellant. Thus, the tribunal is unable to consider the plea of the appellant that consideration received should be treated as cum tax. As regards the penalty, the rule as it stood in the relevant time prescribed a minimum penalty equal to the Service Tax demand confirmed and a maximum penalty which was twice the amount of Service Tax confirmed. Therefore, discretion was available to the appellate authority only within the minimum value and the maximum value and there was no discretion given to the authority under the law for reducing the penalty. Therefore, following the decision in the case of Shiv Ratan Advertisers (cited supra), the reduction in penalty by the lower authority below the minimum prescribed is not sustainable in law. Consequently, the appellant would be liable to pay penalty equal to the Service Tax demand confirmed in the order of the adjudicating authority. Thus, the appeal filed by the appellant, M/s. Rudra Galaxy Channel Ltd. is rejected and the appeal filed by the Revenue is allowed.
 
Decision-Appeal filed by the revenue is allowed

Comment-The analogy in the case is that the benefit of cum tax would be availed by the assessee only if he is able to provide the documentary evidence showing that the amount received by the assessee was cum tax and regarding the penalty issue the discretion is only between the minimum and maximum value and no discretion is given to the authority under the law for reducing the penalty. Hence following the remarkable decision in the case of Shiv Ratan Advertisers the reduction in penalty by the lower authority below the minimum prescribed is not sustainable in law.

Prepared By-Neelam Jain
 

Department News


Query

 
PRADEEP JAIN, F.C.A.

Head Office : -

Address :
"SUGYAN", H - 29, SHASTRI NAGAR, JODHPUR (RAJ.) - 342003

Phone No. :
0291 - 2439496, 0291 - 3258496

Mobile No. :
09314722236

Fax No. :0291 - 2439496


Branch Office : -

Address:
1008, 10th FLOOR, SUKH SAGAR COMPLEX,
NEAR FORTUNE LANDMARK HOTEL, USMANPURA,
ASHRAM ROAD, AHMEDABAD-380013

Phone No. :
079-32999496, 27560043

Mobile No. :
093777659496, 09377649496

E-mail :pradeep@capradeepjain.com