Indirect Tax Weekly Flashback for the period 12 January 2025 to 18 January 2025.
Table of Contents
Delhi High Court
Irregularities In Delhi Excise Policy: Delhi High Court Pulls up Aam Aadmi Party After CAG’s Report
The Delhi High Court has pulled up Aam Aadmi Party (AAP) after the report of Comptroller and Auditor General (CAG) revealing the irregularities in the Delhi excise policy.
“The way you’ve been dragging your feet is something unfortunate. You should’ve been prompt in sending it (reports) to the speaker and having a discussion at the floor of the assembly,” the court told the Delhi government.
Permissible Limit Of Gold Under Baggage Rules Not In Tune With Current Market Value Of Gold: Delhi High Court Directs CBIC To Re-Look
Case Title: Qamar Jahan Versus Union Of India, Represented By Secretary, Ministry Of Finance & Ors.
The Delhi High Court has held that the values of gold that would be permissible under the Baggage Rules would also have to be re-looked by the Central Board of Indirect Taxes and Customs (CBIC) as the same appears to be completely not in tune with the current market value of gold.
Delhi High Court Quashes Seizure, Detention Of Goods In Transit For Mere Minor Technicality
Case Title: Kamal Envirotech Pvt. Ltd Versus Commissioner Of Gst And Anr; M/S Zeon Life Sciences Ltd Versus Chief Secretary,Government Of Delhi & Ors.
The Delhi High Court has quashed the seizure, detention of goods in transit for mere minor technicality.
The bench of Justice Yashwant Varma and Justice Harish Vaidyanathan Shankar has observed that the levy of penalties under the GST Act must be guided by the salutary principles which stand embodied in Section 126. That statutory provision is undoubtedly an embodiment of the legislative intent of levy of penalties being guided by principles of moderation, restraint and reasonableness.
Calcutta High Court
Appeal Against CESTAT’s Order On Determination Of Disputes Relating To Taxability Or Excisable Of Goods Lies Before Supreme Court: Calcutta High Court
Case Title: Commissioner Of Service Tax Kolkata Vs M/S Simplex Infrastructure Limited
The Calcutta High Court has held that the appeal against order of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) on determination of disputes relating to taxability or excisable of goods lies before the Supreme Court and not the High Court.
The bench of Chief Justice T.S Sivagnanam and Justice Hiranmay Bhattacharyya has observed that the Ministry of Finance, Department of Revenue, Tax Research Unit has issued circular dated 10.7.2014 by which it was clarified that determination of disputes relating to taxability or excisable of goods is covered under the term “Determination of any question having a relation to the rate of duty” and, hence, appeal against Tribunal order in which matters would lie before the Supreme Court.
Allahabad High Court
Whether Finance Act (No.2) 2024 Will Be Applicable On Reassessment Proceedings Initiated Prior To 01.09.2024? Allahabad High Court To Answer
Case Title: Ravish Rastogi Versus UOI
The Allahabad High Court will examine the issue whether Finance Act (No.2) 2024 will be applicable on reassessment proceedings initiated prior to 01.09.2024.
The bench of Justice Brij Raj Singh and Justice Rajan Roy has stayed the proceedings and asked the department to respond to the question as to how the proceedings under Section 148A(b) initiated prior to 01.09.2024, if at all, would be saved after coming into force of the Finance (No.2) Act, 2024 w.e.f. 01.09.2024 especially in view of Section 152(4) of the Income Tax Act, 1961 which has been inserted by the Finance (No.2) Act, 2024.
Madras High Court
Interest On Delayed Credit Reversal In Inverted Duty Structure By Textile Manufacturer Is Unjustified: Madras High Court
Case Title: Sri Cheran Synthetics India Private Limited Versus The Union of India
The Madras High Court has held that interest on delayed credit reversal in inverted duty structure by textile manufacturers is unjustified.
The bench of Justice C. Saravanan has observed that levy of interest of Rs.59,35,528/- purportedly in exercise of power under Section 50(3) of the CGST Act, 2017 is unjustified. The question of levy of interest under the impugned circular would apply to the petitioner only if there was a wrong utilization of the Input Tax Credit accumulated prior to the cut off date in the Notification No.20/2018- Central Tax Rate dated 26.07.2018.
CESTAT
Consignment Without Proper Documents Can’t Be Exported Without Customs Official Sanction: CESTAT Quashes Penalty Against Steamer Agent
Case Title: M/s. Samudera Shipping Line (India) Pvt. Ltd. Versus Commissioner of Customs (Port)
The Kolkata Bench of Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has quashed the penalty against steamer agents on the ground that the consignment without proper documents cannot be exported without customs official sanction.
The bench of R. Muralidhar (Judicial Member) and K. Anpazhakan (Technical Member) has observed that without the clearance of the Customs Officials, even if the appellant had loaded the consignment without proper documents, the final export could not have taken place, unless the LEO is signed by the concerned officials. The fact that the consignment was finally exported shows that at some point or the other, the Customs Officials would have signed the Let Export Order (LEO) allowing the consignment to be exported out of India.
Action Of GST Dept. In Refund Claim Rejection Citing Limitation Is Harsh: CESTAT
Case Title: M/s. Advance Micro Fertilizers Pvt.Ltd. Versus Commissioner of Central Excise And CGST
The Delhi Bench of Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has held that action of the GST department in refund claim rejection citing limitation is harsh.
The bench of Binu Tamta (Judicial Member) has observed that the rejection of the refund claim on the ground of limitation is erroneous and is unsustainable also, where the appellant was eligible to carry forward/transit the Canvat Credit under the transitional provisions of Section 140 of CGST Act.
CESTAT Quashes Service Tax Demand On Corporate Guarantees Raised After 5 Years
Case Title: M/s. Wellworth Project Developers Private Limited Versus Commissioner of CGST
The Delhi Bench of Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has quashed service tax demand on corporate guarantees raised after 5 years.
The bench of Justice Dilip Gupta (President) and P. V. Subba Rao (Technical Member) has observed that the confirmation of demand of service tax under corporate guarantees for the Financial Year 2017-18 cannot be sustained. The confirmation of demand of corporate guaranties for the Financial Year 2013-14 has been found to be beyond five years and, therefore, barred by limitation.
Non-Recording Of Statements By Customs Dept.: CESTAT Quashes Confiscation Of Gold Biscuits
Case Title: Jyoti Jewellers Versus C.C.
The Ahmedabad Bench of Customs, excise and Service Tax Appellate Tribunal (CESTAT) has quashed the confiscation of gold biscuits on the grounds that the customs authority has failed to record the statement of the relevant person.
The bench of Somesh Arora (Judicial Member) has observed that the production of Bill of Entry which in higher probability related to the gold biscuits seized, the non recording of any statement of the relevant persons by the department coupled with finding being based on assumption and presumption makes the confiscation bad in law.
Seized Gold Cannot Be Absolutely Confiscated For Mere Invalid LOA; Doesn’t Falls Under Customs Officers’s Jurisdiction: CESTAT
Case Title: M/s Encee International NSEZ Versus Commissioner of Customs
The Allahabad Bench of Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has held that seized gold cannot be absolutely confiscated for mere invalid Letter of Authority (LOA).
There existed the difference of opinion of the two members namely P. K. Choudhary (Judicial Member) and Sanjiv Srivastava (Technical Member) on the issues recorded in terms of two separate orders passed by two Members of the original Division Bench has been placed before Third Member namely S. S. Garg (Judicial Member).
Investigation Report By SVB For Finalising Provisionally Assessed BoE’s Not ‘Appealable Order’: CESTAT Dismisses Hyundai’s Appeal
Case Title: Hyundai Motor India Ltd. Versus Commissioner of Customs
The Chennai Bench of Customs, Excise and Service Tax Appellate Tribunal (CESTAT) while dismissing the appeal of Hyundai Motors has held that the investigation report by Special Valuation Branch (SVB) for finalising provisionally assessed Bill of Entry’s (BOE) is not an ‘appealable order’.
The bench of P. Dinesha (Judicial Member) and M. Ajit Kumar (Technical Member) has observed that the investigation report is administrative and fact finding in nature as it does not purport to decide the lis or contest between the contending parties by a statutory authority. A person who joins the inquiry and who assists or is questioned or submits documents and other proof in a dispute that is of assistance in reaching a conclusion on the matter being inquired into, cannot have a grievance that he was not given a personal hearing before finalizing the report.
Customs Dept. Failed To Prove Dry Dates Were Of Pakistan Origin, Not From UAE: CESTAT Quashes Penalty Imposed On Indian Importer
Case Title: S. S. Overseas Versus The Principal Commissioner of Customs
The Delhi Bench of Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has quashed the penalty imposed on the Indian Importer as the customs dept. failed to prove dry dates were of Pakistan origin and not from UAE.
The bench of Justice Dilip Gupta (President) and P. V. Subba Rao (Technical Member) has observed that the Principal Commissioner was not justified in ignoring the certificate of origin issued by the competent authority in UAE. In the absence of a finding by the competent authority that this is a fake certificate, this certificate would conclusively prove that the imported goods originated from the UAE.
Value Of Sprouts To Be Included In Assessable Value Of “Malt” For Determining Excise Duty: CESTAT
Case Title: M/s.Malsters & Blenders (India) Pvt. Ltd. Versus Commissioner of Central Excise and CGST Commissionerate
The Delhi Bench of Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has held that the value of sprouts should be included in the assessable value of “malt” for determining excise duty.
The bench of Binu Tamta (Judicial Member) and P.V. Subba Rao (Technical Member) has observed that appellant has sold the sprouts outside to the third party and retained the sale proceeds, then the value is required to be added to that of the goods, the malt supplied to the principal manufacturer and it attracts excise duty.
TASMAC Liable To Pay Service Tax On Licence Fees Received For Period 1.7.2012 To 28.3.2013: CESTAT
Case Title: M/s. Tamil Nadu State Marketing Corporation Ltd. Versus Commissioner of GST & Central Excise
The Chennai Bench of Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has held that Tamil Nadu State Marketing Corporation Ltd. (TASMAC) is liable to pay service tax of the licence fees received for the period 1.7.2012 to 28.3.2013.
The bench of P. Dinesha (Judicial Member) and M. Ajit Kumar (Technical Member) has observed that interest is necessarily linked to the delayed or deferred payment of duty, liability arises automatically by operation of law, as under section 75 of the Finance Act 1994.
CAAR
‘Samsung Galaxy Ring’ Imported Into India Classifiable As “Other Instruments, Appliances And Machines”, And Not Imitation Jewellery: CAAR
Applicant Name: Samsung India Electronics Private Limited
The Customs Authority of Advance Ruling (CAAR) has held that ‘Samsung Galaxy Ring’ imported into India classifiable as “other instruments, appliances and machines”, and not imitation jewellery.
The bench of Samar Nanda has observed that ‘Sizing kit’ imported into India would merit classification under HSN: 9031 as Measuring or checking instruments, appliances and machines, not included elsewhere.
Seizure News
Delhi Customs Dept. Catches 1.94 Kg Gold In Trolley Bag Metal Linings Of A Married Couple
A Married Couple was held for smuggling 1.94 Kgs gold worth Rs 1.41 Cr at IGI Airport headed by Commissioner Mr. Vishal Pal Singh.
The customs department intercepted the couple after their arrival from Bahrain.
The couple was arrested at Indira Gandhi International (IGI) airport for allegedly smuggling into the country gold worth Rs 1.41 crore in 4 silver-coloured metal wires concealed inside the lining of trolley bags.
Vijayawada Customs Seizes Smuggled Chinese Origin Garlic’ Worth Rs.21.97 Lakhs
The Vijayawada Customs headed by Commissioner Sadhu Narsimha Reddy has seized smuggled chinese origin garlic’ worth Rs.21.97 lakhs.
The officers of Customs Commissionerate (Preventive), Vijayawada intercepted a truck near Nellore & on 20-11-2024 seized 333bags weighing 9,990 kg ‘smuggled Chinese origin garlic’ valued at Rs.21.97 lakhs which has been banned in India.
Delhi Customs Seizes 6.47 kg Cocaine Worth Rs 97.44 crores , 8 Foreign Nationals Arrested
The Delhi Customs Department headed by Commissioner Vishal Pal Singh as seized 6.47 kgs of Cocaine worth Rs 97.44 crores and 8 Foreign Nationals were arrested in the month of December 2024 at IGI Airport.
Customs officers at IGI Airport, New Delhi, have intercepted multiple drug smuggling attempts, seizing 6,479 grams of cocaine worth a staggering ₹97.44 crore.
Customs Dept. Arrests Brazilian Man For Smuggling 91 Capsules Of Cocaine Inside Stomach
The Customs Department has arrested the Brazilian Man for smuggling 91 capsules of cocaine inside stomach.
Customs officers at IGI Airport, New Delhi, have uncovered a case of drug smuggling involving a Brazilian national. The passenger, who arrived on 26.12.2024 at Terminal-3 via Flight AF453 (Sao Paulo to Paris) and subsequently Flight AF226 (Paris to New Delhi), was intercepted after crossing the Green Channel at the International Arrival Hall.
Delhi Customs Dept. Arrests Canadian Man For Carrying Crocodile Skull
The Customs Department, IGI Airport, New Delhi has arrested a Canadian Man for carrying a crocodile skull.
During a security check at Terminal-3, IGI Airport, a Canadian passenger scheduled to depart to Canada was intercepted. Upon examination, a skull with sharp teeth, resembling the jaw of a baby crocodile, weighing approximately 777 grams, was discovered wrapped in a cream-colored cloth.
Gold Buttons in Ladies Dresses – Smuggling Attempt Foiled at IGI Airport Under The Leadership Of Vishal Pal Singh
The Customs Department, IGI Airport, New Delhi headed by Commissioner Vishal Pal Singh has intercepted an Indian national male passenger attempting to smuggle concealed gold.
The Indian national male passenger was traveling from Jeddah to New Delhi.
257 Grams Gold Found Inside Screwdriver – Smuggling Attempt Foiled at IGI Airport Under The Leadership Of Vishal Pal Singh
The smuggling attempt was foiled by the Delhi Customs Department at IGI Airport under the leadership of Vishal Pal Singh wherein 257 grams of gold was found inside the screwdriver.
On the basis of profiling, a 20 year old male passenger from UP traveling from Jeddah to Delhi on flight XY-329 (dated 14/15 January 2025) was identified for surveillance.
