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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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PJ/Case Laws/2012-13/1287

Whether CESTAT can remand the matter back with the direction to the appellant to first pre deposit a part of the duty even though the Act does not provide?
Case:-Fidelity Magnetics versus Commissioner of Central Excise
 
Citation:-2012 (27) S.T.R. 4 (Bom.)
 
 
Brief Facts:-The Appellant is engaged in the manufacture of recorded audio cassettes on job work basis for various music companies. The assessee was called upon to show cause as to why the clearances effected during the period from 1-3-1997 to 1-6-1998 should not be held to be under valued and duty should not be recovered with interest and penalty. The assessee op­posed the claim in the show cause notice. In the order in original, the duty demand was confirmed with interest and penalty. On appeal filed by the assessee, the Commissioner of Central Excise (Appeals), by his order, directed the assessee to make pre-deposit of the entire amount of duty by relying upon the Circular No. 619/2002 dated 19-2-2002. As the amount was not deposited as per the order, the Commissioner of Central Excise (Appeals) by his order missed the appeal for non compliance of the pre-deposit order. The assessee filed further appeal be­fore the CESTAT with an application seeking waiver of pre-deposit and the tribunal by following its decision in the case of Vijayata Audio World and Ors. waived the pre-deposit. Subsequently, the impugned order of Commissioner (Appeals) is set aside by the tribunal and the matter has been restored to file the same to the Commissioner (Appeals) with a direction to pass fresh order on merits as the issue was highly debatable and highly arguable. However, the Tribunal further directed that the order of the Tribunal in restoring the appeal before the Commissioner (Appeals) shall be subject to the condition that the assessee shall de­posit 50% of the amount involved within the time stipulated therein. Challenging the aforesaid order the present appeal is filed.
           
Appellant’s Contention:-The appellant said that once the application for waiver of pre-deposit is allowed by the Tribunal and the matter was heard on merits, the Tribunal while setting aside the order of Commissioner (Appeals) and restoring the matter to file the same to Commissioner (Appeals) could not have di­rected the assessee to make pre-deposit.
 
Reasoning of Judgement:- We have considered the submissions of both sides. In the present case the Commissioner of Central Excise (Appeals) had directed the assessee to make pre-deposit by relying upon the Circular No. 619/2002. Similarly the Tribunal by following its decision in the case of Vijayata Audio World and Ors. (supra) had granted full waiver of pre-deposit. While disposing of the appeal, the Tribunal has neither considered the applicabil­ity of the Circular No. 619/2002 nor the non-applicability of the order of the Tri­bunal in the case of Vijayata Audio World (supr4). In any event, having granted full waiver of pre-deposit, the Tribunal in the absence of any special circumstances ought not to have ordered pre-deposit. In these circumstances, since the issue in the present case relates to the period 1-3-1997 to 1-6-1998, it would be just and proper to set aside the order passed by the Commissioner (Appeals) and also the order of CESTAT and direct the Commissioner of CESTAT (Appeals) to dispose of the appeal on merits without insisting pre- deposit. Accordingly, without going into the question as to whether the Tri­bunal has power to direct pre-deposit under Section 35C(1) of the Central Excise Act 1944, we dispose of the appeal in terms stated herein above. The appeal is disposed of accordingly with no order as to costs.
 
Decision:-Appeal Allowed.
 
Comment:This is a weird case wherein the Tribunal firstly granted full waiver of pre-deposit and subsequently, directed the appellant to file the appeal to the Commissioner (Appeals) with the condition to deposit 50% of the amount involved on account of issue under consideration being highly debatable.  
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