VAT AND SERVICE TAX CASES (VST)

ONLINE EDITION

VOL. 8 : ISSUE DATED 24-3-2017

HIGH COURT

Value added tax--See Writs under Constitution (HP) . . . 223

Writs under Constitution--Value added tax--Existence of alternative remedy--Writ will not issue--Himachal Pradesh Value Added Tax Act (12 of 2005), ss. 45, 46, 48.--Indian Technomac Company Ltd. v. State of H. P. (HP) . . . 223


PRINT EDITION

VOLUME 99 : PART 2 : ISSUE DATED 24-3-2017

HIGH COURTS

Appeal--Sales tax--Appeal to Appellate Tribunal--Delay in filing--Condonation of delay sought on ground dealer awaiting result of application for rectification--Dismissal on ground no record of such application available--Later in proceedings taken by Department before Tribunal factum of filing of application by dealer established--Appeal to High Court--Delay bona fide and to be condoned--Order of Tribunal quashed and matter remanded to Tribunal for disposal of appeal on merits.--Krishak Bharti Co-operative Limited v. Commissioner of Commercial Taxes (Guj) . . . 135

----See also Revision (Karn) . . . 139

Banks and financial institutions--See Recovery of tax [FB] (Mad) . . . 222

Company--Value added tax--Recovery of tax--Liability of company to pay its tax dues cannot be fastened on its directors --Gujarat Value Added Tax Act, 2003 (1 of 2005).--Different Solution Marketing Private Ltd. v. Assistant Commissioner of Commercial Taxes (Guj) . . . 218

Entries in Schedule--Item in existing tax-free Schedule brought under another Schedule with Note that it shall be deemed to have been excluded from tax-free Schedule--No scope for contending that entry favourable to assessee applicable.--Haryana Pump Manufacturers Association v. State of Haryana (P&H) . . . 198

----Value added tax--Submersible pump sets used for agricultural purposes--Fall in entry 1(D)(9) of Schedule B up to June 30, 2006 and are exempt--From July 1, 2006 onwards pump sets below 5 h. p. capacity fall in entry 71A in Schedule C and are taxable irrespective of their end-use--Haryana Value Added Tax Act (6 of 2003), Sch. B, entry 1(D)(9), Sch. C, entry 71A.--Haryana Pump Manufacturers Association v. State of Haryana (P&H) . . . 198

----Value added tax--Tissue paper and its forms, namely, tissue paper, napkin, toilet paper rolls, kitchen wipes and facial tissues--Fall under entry dealing with paper--Not to be taxed under residual entry--Haryana Value Added Tax Act (6 of 2003), Sch. C, entry 57.--S. R. Foils and Tissue Limited v. State of Haryana (P&H) . . . 208

Exemption--Value added tax--Entries in Schedule--Submersible pump sets used for agricultural purposes--Fall in entry 1(D)(9) of Schedule B up to June 30, 2006 and are exempt--From July 1, 2006 onwards pump sets below 5 h. p. capacity fall in entry 71A in Schedule C and are taxable irrespective of their end-use--Haryana Value Added Tax Act (6 of 2003), Sch. B, entry 1(D)(9), Sch. C, entry 71A.--Haryana Pump Manufacturers Association v. State of Haryana (P&H) . . . 198

Government--See Recovery of tax [FB] (Mad) . . . 222

High Court--See Precedent(P & H). . .208

Input-tax credit--Value added tax--Proportionate disallowance where goods purchased not used for specified purpose--Purchase of timber as raw material for producing sawn timber--Firewood produced as by-product and exempt--Not a case where entire timber not used for specified purpose--Proportionate disallowance not attracted--Gujarat Value Added Tax Act, 2003 (1 of 2005), s. 11.--Arya Lumbers Pvt. Ltd. v. State of Gujarat (Guj) . . . 146

Limitation--Sales tax--Appeal to Appellate Tribunal--Delay in filing--Condonation of delay sought on ground dealer awaiting result of application for rectification--Dismissal on ground no record of such application available--Later in proceedings taken by Department before Tribunal factum of filing of application by dealer established--Appeal to High Court--Delay bona fide and to be condoned--Order of Tribunal quashed and matter remanded to Tribunal for disposal of appeal on merits.--Krishak Bharti Co-operative Limited v. Commissioner of Commercial Taxes (Guj) . . . 135

Notice--See Revision (Karn) . . . 139

Penalty--Value added tax--Dealer paying tax on presumptive basis--Assessments made under regular provisions on ground of suppression of turnover--Dealer not entitled to input-tax credit--Levy of penalty permissible--Kerala Value Added Tax Act, 2003 (30 of 2004), ss. 6(5), 22(7), 25(1).--Prakasan (N.) v. Commercial Tax Officer-1 (Ker) . . . 171

Precedent--High Court--Observations in judgment to be read in context.--S. R. Foils and Tissue Limited v. State of Haryana (P&H) . . . 208

Presumptive tax--Value added tax--Dealer having turnover less than Rs. 60 lakhs--Detection of suppression of turnover and additions therefor--Turnover even after addition remaining below Rs. 60 lakhs--Dealer not to be denied benefit of paying presumptive tax--Kerala Value Added Tax Act, 2003 (30 of 2004), s. 6(5).--Mooken Devassy (Thevara) & Co. v. Commercial Tax Officer (Ker) . . . 164

----Value added tax--Dealer paying tax on presumptive basis--Assessments made under regular provisions on ground of suppression of turnover--Dealer not entitled to input-tax credit--Levy of penalty permissible--Kerala Value Added Tax Act, 2003 (30 of 2004), ss. 6(5), 22(7), 25(1).--Prakasan (N.) v. Commercial Tax Officer-1 (Ker) . . . 171

Recovery of tax--Value added tax--Company--Liability of company to pay its tax dues cannot be fastened on its directors --Gujarat Value Added Tax Act, 2003 (1 of 2005).--Different Solution Marketing Private Ltd. v. Assistant Commissioner of Commercial Taxes (Guj) . . . 218

----Value added tax--Sales tax--Banks and financial institutions--Debts due to--Priority of charge--Properties mortgaged to financial institution--Secured creditor has priority of charge over Government dues--Recovery of Debts Due to Banks and Financial Institutions Act (51 of 1993), s. 31B.--Assistant Commissioner (CT) v. Indian Overseas Bank [FB] (Mad) . . . 222

Rectification of mistake--Value added tax--Works contract--Assessment order passed based on total purchases made by assessee during assessment year without considering pleadings that out of total units of 624 apartments, no contract entered into with purchasers in respect of 306 units and no works contract--Not justified--No works contract in absence of contract executed with potential purchasers by builder--Non-consideration of relevant materials pleaded amounts to error apparent on face of record--Order by assessing officer rejecting application for rectification set aside--Matter remitted for fresh consideration--Kerala Value Added Tax Act, 2003 (30 of 2004), ss. 25(1), 66 --Kerala Value Added Tax Rules, 2005, r. 10(2)(a), proviso.--Oceanus Dwellings (P.) Ltd. v. Commercial Tax Officer (Works Contract) (Ker) . . . 129

Refund--Value added tax--Appeal--Revision--Notice--Appeal against reassessment order by Deputy Commissioner allowed by Joint Commissioner with direction to Deputy Commissioner to refund amount--Stay order passed by Additional Commissioner in exercise of suo motu revisional power--Neither communicated to assessee nor order of refund complied with for more than eight months--Direction to assessing authority to refund amount within specified period and assessee to appear before Additional Commissioner to be supplied with notice--Karnataka Value Added Tax Act, 2003 (32 of 2004), ss. 36(1), 39(1), 64, 72(2).--Entire Ceramics Limited v. Deputy Commissioner of Commercial Taxes (Karn) . . . 139

Rent-a-cab service--Service tax--Assessee providing cab service--Order levying tax, interest and penalty--Proper--Finance Act (32 of 1994), ss. 65(59), (72)(o), 66(3).--Express Tours & Travels Pvt. Ltd. v. Commissioner of Central Excise and Customs (Guj) . . . 143

Revision--Value added tax--Refund--Appeal--Notice--Appeal against reassessment order by Deputy Commissioner allowed by Joint Commissioner with direction to Deputy Commissioner to refund amount--Stay order passed by Additional Commissioner in exercise of suo motu revisional power--Neither communicated to assessee nor order of refund complied with for more than eight months--Direction to assessing authority to refund amount within specified period and assessee to appear before Additional Commissioner to be supplied with notice--Karnataka Value Added Tax Act, 2003 (32 of 2004), ss. 36(1), 39(1), 64, 72(2).--Entire Ceramics Limited v. Deputy Commissioner of Commercial Taxes (Karn) . . . 139

Sales tax--Value added tax--Recovery of tax--Banks and financial institutions--Debts due to--Priority of charge--Properties mortgaged to financial institution--Secured creditor has priority of charge over Government dues--Recovery of Debts Due to Banks and Financial Institutions Act (51 of 1993), s. 31B.--Assistant Commissioner (CT) v. Indian Overseas Bank (Mad) . . . 222

Service tax--Rent-a-cab service--Assessee providing cab service--Order levying tax, interest and penalty--Proper--Finance Act (32 of 1994), ss. 65(59), (72)(o), 66(3).--Express Tours & Travels Pvt. Ltd. v. Commissioner of Central Excise and Customs (Guj) . . . 143

Suppression of turnover--Value added tax--Presumptive tax--Dealer having turnover less than Rs. 60 lakhs--Detection of suppression of turnover and additions therefor--Turnover even after addition remaining below Rs. 60 lakhs--Dealer not to be denied benefit of paying presumptive tax--Kerala Value Added Tax Act, 2003 (30 of 2004), s. 6(5).--Mooken Devassy (Thevara) & Co. v. Commercial Tax Officer (Ker) . . . 164

Value added tax--Input-tax credit--Proportionate disallowance where goods purchased not used for specified purpose--Purchase of timber as raw material for producing sawn timber--Firewood produced as by-product and exempt--Not a case where entire timber not used for specified purpose--Proportionate disallowance not attracted--Gujarat Value Added Tax Act, 2003 (1 of 2005), s. 11.--Arya Lumbers Pvt. Ltd. v. State of Gujarat (Guj) . . . 146

----See Entries in Schedule (P&H) . . . 198, 208

----See Penalty (Ker) . . . 171

----See Presumptive tax (Ker) . . . 164

----See Recovery of tax (Guj) . . . 218

----See Rectification of mistake (Ker) . . . 129

----See Revision (Karn) . . . 139

Works contract--Value added tax--Rectification of mistake--Assessment order passed based on total purchases made by assessee during assessment year without considering pleadings that out of total units of 624 apartments, no contract entered into with purchasers in respect of 306 units and no works contract--Not justified--No works contract in absence of contract executed with potential purchasers by builder--Non-consideration of relevant materials pleaded amounts to error apparent on face of record--Order by assessing officer rejecting application for rectification set aside--Matter remitted for fresh consideration--Kerala Value Added Tax Act, 2003 (30 of 2004), ss. 25(1), 66 --Kerala Value Added Tax Rules, 2005, r. 10(2)(a), proviso.--Oceanus Dwellings (P.) Ltd. v. Commercial Tax Officer (Works Contract) (Ker) . . . 129


CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL


Airport service--Service tax--Definition--Service must be rendered to person by specifically described service provider within airport--Development fee levied by airport under authorisation of Central Government under section 22A of Airports Authority of India Act, 1994 for each departing passenger--Not a levy for rendering of service--Not liable to service tax--Finance Act (32 of 1994), s. 65(3c), (105)(zzm)--Airports Authority of India Act, (55 of 1994), ss. 22, 22A.--Mumbai International Airport Pvt. Ltd. v. Commissioner of Service Tax-I (CESTAT-Mumbai) . . . 155

Central excise--Cenvat credit--Inputs used in manufacture of final products being exported--Assessee entitled to avail of Cenvat credit--Irrespective of fact that final products otherwise exempt--Exports on FOB basis--Place of removal is port and not factory gate--Assessee entitled to Cenvat credit for all input services for bringing goods up to port of shipment--Central Excise Act (1 of 1944), ss. 2(f), (p), 3, 6(1)--Central Excise Rules, 2002, r. 6(5)--Cenvat Credit Rules, 2004, r. 6(6)--Notification No. 4/2006-C.E., dated March 1, 2006--CBEC Circular No. 97/8/2007, dated August 23, 2007.--MSPL Limited v. Commissioner of Central Excise (CESTAT-Bang) . . . 180

Cenvat credit--Central excise--Inputs used in manufacture of final products being exported--Assessee entitled to avail of Cenvat credit--Irrespective of fact that final products otherwise exempt--Exports on FOB basis--Place of removal is port and not factory gate--Assessee entitled to Cenvat credit for all input services for bringing goods up to port of shipment--Central Excise Act (1 of 1944), ss. 2(f), (p), 3, 6(1)--Central Excise Rules, 2002, r. 6(5)--Cenvat Credit Rules, 2004, r. 6(6)--Notification No. 4/2006-C.E., dated March 1, 2006--CBEC Circular No. 97/8/2007, dated August 23, 2007.--MSPL Limited v. Commissioner of Central Excise (CESTAT-Bang) . . . 180

----Service tax--Input service--Service tax paid for cleaning of assessee's canteen including housekeeping--Indispensable for factory maintenance and statutory requirement under section 11 of Factories Act, 1948--Entitled to credit--Cenvat Credit Rules, 2004, r. 14--Central Excise Act (1 of 1944), s. 11A(4).--Easun MR Tap Changers P. Ltd. v. Commissioner of Central Excise and Service Tax (CESTAT-Chennai) . . . 167

Exemption--See Cenvat credit (CESTAT-Bang) . . . 180

Export--See Cenvat credit (CESTAT-Bang) . . . 180

Input service--See Service tax (CESTAT-Chennai) . . . 167

Service tax--Airport service--Definition--Service must be rendered to person by specifically described service provider within airport--Development fee levied by airport under authorisation of Central Government under section 22A of Airports Authority of India Act, 1994 for each departing passenger--Not a levy for rendering of service--Not liable to service tax--Finance Act (32 of 1994), s. 65(3c), (105)(zzm)--Airports Authority of India Act, (55 of 1994), ss. 22, 22A.--Mumbai International Airport Pvt. Ltd. v. Commissioner of Service Tax-I (CESTAT-Mumbai) . . . 155

----Cenvat credit--Input service--Service tax paid for cleaning of assessee's canteen including housekeeping--Indispensable for factory maintenance and statutory requirement under section 11 of Factories Act, 1948--Entitled to credit--Cenvat Credit Rules, 2004, r. 14--Central Excise Act (1 of 1944), s. 11A(4).--Easun MR Tap Changers P. Ltd. v. Commissioner of Central Excise and Service Tax (CESTAT-Chennai) . . . 167

Words and phrases--"Airport service"--Definition.--Mumbai International Airport Pvt. Ltd. v. Commissioner of Service Tax-I (CESTAT-Mumbai) . . . 155
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