VAT AND SERVICE TAX CASES (VST)

ONLINE EDITION

VOL. 7 : ISSUE DATED 23-9-2016

HIGH COURTS


Legislative powers--Luxury tax--State Legislature--Luxury provided in banquet halls--Definition--Explanation that value of facilities or amenities provided within precincts by proprietor of banquet hall or any other person on his behalf to be included in computation of threshold value--Valid--Haryana Tax on Luxuries Act (23 of 2007), s. 2(c), (j), (k), Expln.--Constitution of India, art. 14 ; Sch. VII, List II, entry 62.--Laxmi Sadan v. State of Haryana (P&H) . . . 159

Luxury tax--Legislative powers--State Legislature--Luxury provided in banquet halls--Definition--Explanation that value of facilities or amenities provided within precincts by proprietor of banquet hall or any other person on his behalf to be included in computation of threshold value--Valid--Haryana Tax on Luxuries Act (23 of 2007), s.2(c), (j), (k), Expln.--Constitution of India, art. 14 ; Sch. VII, List II, entry 62.--Laxmi Sadan v. State of Haryana (P&H) . . . 159

Service tax--Voluntary Compliance Encouragement Scheme, 2013--Assessee not paid tax during period from April to December, 2012 opted to avail of scheme and deposited 50 per cent. of declared tax dues by way of cheque drawn on and bearing stamp of designated Bank of December 31, 2013 when system of payment through physical challan in vogue--Balance deposited by challans before June 30, 2014--Show-cause notice issued stating that cheque for 50 per cent. of tax due realized only on January 8, 2014 and order dated August 15, 2014 passed rejecting declaration under Voluntary Compliance Encouragement Scheme on ground assessee failed to pay 50 per cent. of declared tax dues by December 31, 2013--Rule providing for deeming date of presentation of cheque to designated bank to be date on which tax paid subject to realization of that cheque--Order rejecting plea for declaration under Voluntary Compliance Encouragement Scheme making no reference to relevant rule--Bad in law--To be set aside--Finance Act (32 of 1994)--Finance Act (17 of 2013), s. 107(3)--Service Tax Rules, 1994, r. 6(2A)--Service Tax Voluntary Compliance Encouragement Scheme, 2013, r. 6(1).--Disha Securities and Manpower Private Limited v. Assistant Commissioner of Service Tax (Delhi) . . . 171

State Legislature--See Luxury tax (P&H) . . . 159

Voluntary Compliance Encouragement Scheme--Service tax--Assessee not paid tax during period from April to December, 2012 opted to avail of scheme and deposited 50 per cent. of declared tax dues by way of cheque drawn on and bearing stamp of designated Bank of December 31, 2013 when system of payment through physical challan in vogue--Balance deposited by challans before June 30, 2014--Show-cause notice issued stating that cheque for 50 per cent. of tax due realized only on January 8, 2014 and order dated August 15, 2014 passed rejecting declaration under Voluntary Compliance Encouragement Scheme on ground assessee failed to pay 50 per cent. of declared tax dues by December 31, 2013--Rule providing for deeming date of presentation of cheque to designated bank to be date on which tax paid subject to realization of that cheque--Order rejecting plea for declaration under Voluntary Compliance Encouragement Scheme making no reference to relevant rule--Bad in law--To be set aside--Finance Act (32 of 1994)--Finance Act (17 of 2013), s. 107(3)--Service Tax Rules, 1994, r. 6(2A)--Service Tax Voluntary Compliance Encouragement Scheme, 2013, r. 6(1).--Disha Securities and Manpower Private Limited v. Assistant Commissioner of Service Tax (Delhi) . . . 171


PRINT EDITION

VOLUME 94 : PART 2 : ISSUE DATED 23-9-2016


SUPREME COURT


Burden of proof--Taxability--Burden on taxing authority to prove particular item taxable as claimed by it.--State of Madhya Pradesh v. Marico Industries Ltd. (SC) . . . 83

Entertainment tax--Promissory estoppel--Scheme of incentives for tourism projects--Provision in Scheme to grant extension of time for implementation of projects--Curtailment of such time by subsequent Government resolution--Attracts principle of promissory estoppel--Gujarat Entertainment Tax Act (16 of 1977), s. 29--New Package Scheme of Incentives for Tourism Projects, 1995-2000.--Devi Multiplex v. State of Gujarat (SC) . . . 95

----Scheme of incentives acquires statutory status--Must be amended by statutory notification--Gujarat Entertainment Tax Act (16 of 1977), s. 29--New Package Scheme of Incentives for Tourism Projects, 1995-2000.--Devi Multiplex v. State of Gujarat (SC) . . . 95

----Scheme of incentives for tourism projects--Impact of incentives offered and consequential burden must be weighed by Government when Scheme formed, not later--Gujarat Entertainment Tax Act (16 of 1977), s. 29--New Package Scheme of Incentives for Tourism Projects, 1995-2000.--Devi Multiplex v. State of Gujarat (SC) . . . 95

----Scheme of incentives for tourism projects --Provision in Scheme to grant extension of time for implementation of projects--Does not cease to operate after expiry of period of operation of Scheme--Gujarat Entertainment Tax Act (16 of 1977), s. 29--New Package Scheme of Incentives for Tourism Projects, 1995-2000.--Devi Multiplex v. State of Gujarat (SC) . . . 95

Entries in Schedule--Entry tax--"Mediker" used for anti-lice treatment--Is drug--Not shampoo--Madhya Pradesh Entry Tax Act (52 of 1976), Sch. II, entry 32.--State of Madhya Pradesh v. Marico Industries Ltd. (SC) . . . 83

----Entry tax--"Revive" instant starch used on clothes--Not chemical--Madhya Pradesh Entry Tax Act (52 of 1976), Sch. I, entry 55.--State of Madhya Pradesh v. Marico Industries Ltd. (SC) . . . 83

Entry tax--Entries in Schedule--"Mediker" used for anti-lice treatment--Is drug--Not shampoo--Madhya Pradesh Entry Tax Act (52 of 1976), Sch. II, entry 32.--State of Madhya Pradesh v. Marico Industries Ltd. (SC) . . . 83

----Entries in Schedule--"Revive" instant starch used on clothes--Not chemical--Madhya Pradesh Entry Tax Act (52 of 1976), Sch. I, entry 55.--State of Madhya Pradesh v. Marico Industries Ltd. (SC) . . . 83

Government--Entertainment tax--Scheme of incentives for tourism projects--Impact of incentives offered and consequential burden must be weighed by Government when Scheme formed, not later--Gujarat Entertainment Tax Act (16 of 1977), s. 29--New Package Scheme of Incentives for Tourism Projects, 1995-2000.--Devi Multiplex v. State of Gujarat (SC) . . . 95

Incentive scheme for tourism projects--Entertainment tax--Promissory estoppel--Scheme of incentives for tourism projects--Provision in Scheme to grant extension of time for implementation of projects--Curtailment of such time by subsequent Government resolution--Attracts principle of promissory estoppel--Gujarat Entertainment Tax Act (16 of 1977), s. 29--New Package Scheme of Incentives for Tourism Projects, 1995-2000.--Devi Multiplex v. State of Gujarat (SC) . . . 95

----Entertainment tax--Scheme of incentives acquires statutory status--Must be amended by statutory notification--Gujarat Entertainment Tax Act (16 of 1977), s. 29--New Package Scheme of Incentives for Tourism Projects, 1995-2000.--Devi Multiplex v. State of Gujarat (SC) . . . 95

----Entertainment tax--Scheme of incentives for tourism projects--Provision in Scheme to grant extension of time for implementation of projects--Does not cease to operate after expiry of period of operation of Scheme--Gujarat Entertainment Tax Act (16 of 1977), s. 29--New Package Scheme of Incentives for Tourism Projects, 1995-2000.--Devi Multiplex v. State of Gujarat (SC) . . . 95

----See also Entertainment tax (SC) . . . 95

Promissory estoppel--Entertainment tax--Scheme of incentives for tourism projects--Provision in Scheme to grant extension of time for implementation of projects--Curtailment of such time by subsequent Government resolution--Attracts principle of promissory estoppel--Gujarat Entertainment Tax Act (16 of 1977), s. 29--New Package Scheme of Incentives for Tourism Projects, 1995-2000.--Devi Multiplex v. State of Gujarat (SC) . . . 95


HIGH COURTS


Appeal--Service tax--Condition precedent--Pre-deposit--Change of law--Amendment making pre-deposit mandatory without discretion in appellate authority to waive or reduce in case of hardship--Not a curtailment of a vested right--Cannot be declared not to apply to proceedings initiated by show-cause notices prior to date of amendment--Finance Act (32 of 1994), s. 83--Central Excise Act (1 of 1944), s. 35F.--Dream Castle v. Union of India (Mad) . . . 158

----Value added tax--Writs under Constitution--Alternative remedy--Procurement of set top box and smart cards for receiving cable T. V. signals and distribution of same through distributors or local cable operators to end subscribers--Writ petition against assessment order levying tax on set top boxes--Dismissed in view of availability of remedy of appeal--Constitution of India, art. 226--Uttar Pradesh Value Added Tax Act (5 of 2008), s. 55.--Hathway Cable and Datacom Ltd. v. State of U. P. (All) . . . 199

Change of law--See Service tax(Mad) . . . 158

Composition of tax--Value added tax--Works contract--Natural justice--Certificate permitting composition--Cancellation--Condition precedent--Opportunity to be granted to dealer to show cause against cancellation--Where certificate not cancelled dealer entitled to continue to pay tax on basis of composition--Notice for reassessment under regular provisions issued without cancellation of certificate--Not permissible--Karnataka Value Added Tax Act, 2003 (32 of 2004), s. 15--Karnataka Value Added Tax Rules, 2005, rr. 135, 136, 137, 145.--Assistant Commissioner of Commercial Taxes (Audit) v. Abidheep Interlock Pavers Pvt. Ltd. (Karn) . . . 186

Natural justice--See Composition of tax (Karn) . . . 186

Penalty--Value added tax--Detention--Collection and delivery of consignment of goods from international airport to various consignees at different locations in State by company providing critical logistic services--Vehicle in transit stopped, documents inspected and notice issued for levy of penalty on ground e-Sugam forms not stamped by concerned commercial tax officer--Petitioner's vehicle detained until amount, sought to be levied as penalty paid--Detention and collection of penalty not preceded by order--Action not legal--Direction to refund amount paid as penalty by petitioner under compelling circumstances--Karnataka Value Added Tax Act, 2003 (32 of 2004).--CriticaLog India Private Limited v. State of Karnataka (Karn) . . . 205

----Value added tax--Movement of goods--Failure to carry required documents--Condition precedent for levy of penalty--Issue of notice and opportunity to dealer to show cause against penalty--Penalty leviable only if sufficient cause for contravention not shown--Levy of penalty before passing order--Illegal--Karnataka Value Added Tax Act, 2003 (32 of 2004), s. 53(12).--Shivam Trading Company v. Commercial Tax Officer (Karn) . . . 201

Pre-deposit--See Service tax (Mad) . . . 158

Reassessment--Value added tax--Works contract--Composition of tax--Natural justice--Certificate permitting composition--Cancellation--Condition precedent--Opportunity to be granted to dealer to show cause against cancellation--Where certificate not cancelled dealer entitled to continue to pay tax on basis of composition--Notice for reassessment under regular provisions issued without cancellation of certificate--Not permissible--Karnataka Value Added Tax Act, 2003 (32 of 2004), s. 15--Karnataka Value Added Tax Rules, 2005, rr. 135, 136, 137, 145.--Assistant Commissioner of Commercial Taxes (Audit) v. Abidheep Interlock Pavers Pvt. Ltd. (Karn) . . . 186

Service tax--Appeal--Condition precedent--Pre-deposit--Change of law--Amendment making pre-deposit mandatory without discretion in appellate authority to waive or reduce in case of hardship--Not a curtailment of a vested right--Cannot be declared not to apply to proceedings initiated by show-cause notices prior to date of amendment--Finance Act (32 of 1994), s. 83--Central Excise Act (1 of 1944), s. 35F.--Dream Castle v. Union of India (Mad) . . . 158

Value added tax--See Composition of tax (Karn) . . . 186

----See also Penalty (Karn) . . . 201, 205

----See also Writs under Constitution (All) . . . 199

Works contract--See Composition of tax (Karn) . . . 186

Writs under Constitution--Value added tax--Alternative remedy--Procurement of set top box and smart cards for receiving cable T. V. signals and distribution of same through distributors or local cable operators to end subscribers--Writ petition against assessment order levying tax on set top boxes--Dismissed in view of availability of remedy of appeal--Constitution of India, art. 226--Uttar Pradesh Value Added Tax Act (5 of 2008), s. 55.--Hathway Cable and Datacom Ltd. v. State of U. P. (All) . . . 199


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