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2014-VIL-317-DEL|VAT |High Court Cases | 22.10.2014

M/s SHUBHAM MARKETING Vs COMMISSIONER VALUE ADDED TAX: 14.10.2014 - Delhi Value Added Tax Act, 2004 – Section 86 - Penalty for non-filing of stock statement online in form Stock-I - Power or jurisdiction to impose fine as a punishment under the provisions of Section 70(5) of the Act - Expressions ‘fine’ and ‘penalty’ – Whether the Commissioner has the power or jurisdiction to impose fine as a punishment under the provisions of Section 70(5) of the said Act through his delegate or such power to impose fine vests with the courts of criminal jurisdiction – HELD - The fine imposed under section 70(5) of the said act is for an “offence” as defined under Section 3(38) of the General Clauses Act, 1... [Read more]

M/s SHUBHAM MARKETING Vs COMMISSIONER VALUE ADDED TAX: 14.10.2014 - Delhi Value Added Tax Act, 2004 – Section 86 - Penalty for non-filing of stock statement online in form Stock-I - Power or jurisdiction to impose fine as a punishment under the provisions of Section 70(5) of the Act - Expressions ‘fine’ and ‘penalty’ – Whether the Commissioner has the power or jurisdiction to impose fine as a punishment under the provisions of Section 70(5) of the said Act through his delegate or such power to impose fine vests with the courts of criminal jurisdiction – HELD - The fine imposed under section 70(5) of the said act is for an “offence” as defined under Section 3(38) of the General Clauses Act, 1897 which shall be tried by the court of criminal jurisdiction in accordance with section 26(b) of the Code of Criminal Procedure, 1973. The commissioner or its delegates do not have power or jurisdiction to impose such fine - Expressions “fine” and “penalty” are not interchangeable - The impugned notices are liable to be quashed on the ground of jurisdiction alone – Assessee appeal allowed

2014-VIL-249-CESTAT-BLR-ST|SERVICE TAX |CESTAT Cases | 22.10.2014

MICROSOFT INDIA (R&D) PVT LTD Vs CST, BANGALORE-SERVICE TAX: 24.09.2014 - Service Tax - Refund claim under Notification No.5/2006-C.E. NT dated 14.3.2006 in respect of unutilized CENVAT credit balance - Refund claim rejected on the ground that services are provided in India and used in India – Product support services agreement between Global Technical Support Centre (GTSC) in Bangalore and Microsoft Corporation USA’s (MSFT) - HELD - We find that in services agreement, it is clearly provided that ‘territory’ shall mean worldwide. When according to the agreement both the parties have to understand that ‘territory’ means ‘worldwide’ how an inference could be drawn that territory means region o... [Read more]

MICROSOFT INDIA (R&D) PVT LTD Vs CST, BANGALORE-SERVICE TAX: 24.09.2014 - Service Tax - Refund claim under Notification No.5/2006-C.E. NT dated 14.3.2006 in respect of unutilized CENVAT credit balance - Refund claim rejected on the ground that services are provided in India and used in India – Product support services agreement between Global Technical Support Centre (GTSC) in Bangalore and Microsoft Corporation USA’s (MSFT) - HELD - We find that in services agreement, it is clearly provided that ‘territory’ shall mean worldwide. When according to the agreement both the parties have to understand that ‘territory’ means ‘worldwide’ how an inference could be drawn that territory means region of India could not be understood - In any case, as we find that the appellants are providing product support service from India and according to the agreement the product support services shall include standard MSFT product support services for products which are generally made available to end-users in the territory and shall include requests for support originating from within the territory. Products support services shall include phone, email, web based and onsite support for all MSFT products. It cannot be said that services have been used in India. We find that appeal has been rejected on the grounds that are not sustainable and accordingly appeal is allowed

2014-VIL-248-CESTAT-AHM-CE|CENTRAL EXCISE |CESTAT Cases | 22.10.2014

M/s JAI CORPORATION LTD Vs CCE, VAPI: 21.10.2014 - Central Excise - Denial of CENVAT Credit which was availed by the appellant when they purchased the property from M/s Asset Reconstruction Company (India) Ltd – Asset taken over under SAFARESI Act by the bankers and handed over to M/s ARCIL - The findings of the adjudicating authority basically revolves around the provisions of Rule 10 of CENVAT Credit Rules, 2004 for denying the CENVAT Credit on the ground that there was no transferring of the inputs and capital goods to the appellant herein – HELD - Transfer of CENVAT Credit has been provided in said provision in sub-rule (1). On deeper perusal of sub-rule (1), it is very clear that when t... [Read more]

M/s JAI CORPORATION LTD Vs CCE, VAPI: 21.10.2014 - Central Excise - Denial of CENVAT Credit which was availed by the appellant when they purchased the property from M/s Asset Reconstruction Company (India) Ltd – Asset taken over under SAFARESI Act by the bankers and handed over to M/s ARCIL - The findings of the adjudicating authority basically revolves around the provisions of Rule 10 of CENVAT Credit Rules, 2004 for denying the CENVAT Credit on the ground that there was no transferring of the inputs and capital goods to the appellant herein – HELD - Transfer of CENVAT Credit has been provided in said provision in sub-rule (1). On deeper perusal of sub-rule (1), it is very clear that when there is change in ownership or on account of sale, with specific provision for transfer of liability, then the manufacturer shall be allowed to transfer the CENVAT Credit lying unutilized to such transferred/sold factory – Perusal of sale certificate issued by M/s Arcil, it transpires that the entire property of M/s Santogen Spinning Mills was handed over to the appellant with all the encumbrances and liabilities which are known and unknown. It would be correct to record that the appellant herein had procured the assets and liabilities from M/s ARCIL, which would include the credit balance lying in books of account of M/s Santogen Spinning Mills. In our considered view, having accepted the entire assets and liabilities together, the appellant cannot be denied the CENVAT Credit which is lying in balance as unutilized credit in the books of account of M/s Santogen Spinning Mills - Impugned order is incorrect, unsustainable and liable to be set aside – Assessee appeal allowed

2014-VIL-316-AP|VAT |High Court Cases | 22.10.2014

M/s RAJ KUMAR ENGINEERING PVT LTD Vs THE STATE OF ANDHRA PRADESH: 24.09.2014 - Andhra Pradesh General Sales Tax Act, 1957 - Section 15(4)(a) – Penalty – Failure to pay tax - Expression levy, charge and collection – Discretion to levy penalty – Mandatory provision – HELD - If the assessing authority was of the view that there was a delay in payment of tax he could have imposed penalty for that month is not without merit, the assessing authority cannot be said to have acted illegally, in considering the failure on the part of the petitioner to pay tax for the earlier months, while exercising discretion to impose penalty for belated payment of tax in a subsequent month. The previous conduct of ... [Read more]

M/s RAJ KUMAR ENGINEERING PVT LTD Vs THE STATE OF ANDHRA PRADESH: 24.09.2014 - Andhra Pradesh General Sales Tax Act, 1957 - Section 15(4)(a) – Penalty – Failure to pay tax - Expression levy, charge and collection – Discretion to levy penalty – Mandatory provision – HELD - If the assessing authority was of the view that there was a delay in payment of tax he could have imposed penalty for that month is not without merit, the assessing authority cannot be said to have acted illegally, in considering the failure on the part of the petitioner to pay tax for the earlier months, while exercising discretion to impose penalty for belated payment of tax in a subsequent month. The previous conduct of the dealer is not an irrelevant factor in deciding whether or not penalty should be imposed on a dealer. We may not be understood to have held that in all cases where penalty is imposed, the previous conduct of the dealer should be taken into consideration. All that we have held is that the authority cannot be said to have acted illegally if, while exercising his discretion to impose penalty, he has taken the previous defaults of the dealer, in making belated payment of tax to the State, into consideration - Section 16(3) of the A.P.G.S.T. Act requires the dealer to pay interest, at the stipulated rate, for belated payment of tax, penalty or any other amount due under the Act. Interest is levied for the period of the delay. The very fact that interest is also levied for belated payment of the penalty amount, goes to show that levy of interest is not in substitution of the penalty which can be imposed under Section 15(4) of the Act. The petitioners contention that, as interest is leviable under Section 16(3) of the Act, penalty should not be imposed under Section 15(4)(a) of the Act is, therefore, not tenable – Assessee appeal dismissed