High Court of Punjab & Haryana
Check gate authorities could not possibly go into intricate questions as to whether it was branch or inter-state sale

STATE OF PUNJAB AND ANOTHER
Vs
M/s SHREYANS INDUSTRIES LTD

13th August, 2014

Held that the drivers of the vehicles had the invoices in the form of stock transfer and GRs with them. Even if the drivers had some document showing that the goods were to be unloaded at the address of CWC stores, still the documents which the drivers were carrying could not be said to be ingenuine or transaction doubtful - If there was any doubt then the matter should have been reported to the Assessing Authority rather than conducting proceedings under Section 14-B of the Act. Proceedings under Section 14-B of the Act are summary proceedings and the authorities at the ICC could not possibly go into intricate questions as to whether it was branch or inter-state sale.

Hon'ble High Court also relied on the earlier judgment of the same Court in the case - GSTR No.10 of 1998 (M/s Devi Dass Gopal Krishan Ltd., Moga v. State of Punjab), decided on 16.2.2009 and specifically quoted "However, the provisions do not permit the officer to go to the extent of determining the nature of the transaction, which, in fact, lies within the jurisdiction of the regular assessing authority".

Supreme Court of India
Retained amount of Sales Tax will form part of the transaction value for the purpose of levy Excise Duty.

 COMMISSIONER OF CENTRAL EXCISE, DELHI-III
Vs
M/s MARUTI SUZUKI INDIA LTD

3rd September, 2014

Held- There is no doubt that 50% of the sales tax collected was retained by the assessee and was not actually paid to the exchequer nor was it actually payable since the HPC permitted the assessee to retain that amount Therefore, whichever way the issue is looked at, the fact remains that the assessee retained with it 50% of the sales tax collected from its customers and it was neither actually paid to the exchequer nor was it actually payable to the exchequer. That being the position, the transaction value was required to be calculated by including the amount of about Rs . 22.44 crores retained by the assessee.

Full text of the judgment not yet received

DELHI VAT CIRCULAR, WHETHER SAME THEORY WILL APPLY ON SECTION 82(A) OF AVAT ACT, 2003

CIRCULAR ISSUED IN REFERENCE TO DELHI VAT:-

New Delhi: 03.09.2014

GOVERNMENT OF NATIONAL CAPITAL TERRITORY OF DELHI
DEPARTMENT OF TRADE AND TAXES - POLICY BRANCH
No.F.3(458)/Policy/VAT/2014/335-341
 

CIRCULAR NO. 10 OF 2014-2015

Third proviso to section 74(1) of Delhi Value Added Tax Act, 2004 was inserted vide Notification No.F.14(6)/LA-2011/Iclaw/193 dated 28/09/11 which was made effective from 01/10/2011 vide Notification No. No.3(15)Fin.(Rev-I)/2011-12/ssf/113 dated 30/09/2011. The proviso is reproduced as under:-
“PROVIDED ALSO that the Commissioner may, after giving to the dealer an opportunity of being heard, may direct the dealer to deposit an amount deemed reasonable, out of the amount under dispute, before such objection is entertained.”

Since the above Notification came into effect from, 01/10/2011, the Objection Hearing Authorities can impose a pre-condition on the dealer to deposit an amount out of the amount under dispute, before such objection is entertained, only in case the objection pertains to tax periods after the above said amendment.
This issues with the approval of the Commissioner, Value Added Tax conveyed vide diary No. 1266 dated 27.08.2014.

COMMENT :-
Section 82 (A) has been inserted in Assam VAT Act, 2003 on 8th April, 2008, which contains "
An application by a dealer or person shall not be entertained by the Commissioner unless such application is accompanied by satisfactory proof of payment of minimum twenty five percent of the disputed tax, penalty, if any, imposed and the interest accrued thereon, if any............................" The aforesaid sub-section was not inserted with any retrospective effect. I have tried in my book "VAT Laws in Assam" to interpret the aforesaid sub-section and opined that the condition of pre-deposit is applicable in cases of tax periods after the date of 8th April, 2009.

For my comments on this point, please click here

Lease transaction- Tax tro be levied as per the alw prevailing on the date of lease (not on the date of payment)

High Court of Karnataka

Tax laws applicable on the date of lease of the goods will govern and not the laws on date of receiving the payment.

The State of Karnataka

Vs.

M/s. Lease Plan India Limited

06/08/2014:

Respondent assessee leased vehicle to its customer on some date prior to introduction of KVAT Act  for a period of five years on rental payable monthly. The said lease transaction, being subsequent sale was not taxable in earlier Act. Held-After the coming into force of the new Act, the assessee has not leased any car to his customers. Lease was prior to 1.4.2005. It is for a period of 5 years. Under the terms of the agreement, the customer has to pay lease rents for every month for a period of 5 years. Therefore, though the assessee continued to receive rentals every month after 1.4.2005, it is in pursuance of a sale which took place prior to 1.4.2005. As no sale has taken place after 1.4.2005, the liability to pay tax under Section 3 does not arise.

For full text of judgment- Please click here

CBDT issued new Guidelines for Manual Scrutiny Selection

2nd September-2014, New Delhi


CBDT has issued criteria and procedure for compulsory manual selection of cases for scrutiny during the financial year 2014-2015.


For full text of the instruction:-Please click here

CBDT says: Value Taxpayer’s time and do not make them wait

The  CBDT in its office memorandum  dated 22.08.2014 has pointed out that few Assessing officers, while issuing notices for appearance,  indicates a standard time to all the respondents and therefore many persons called for hearing etc on a day by an officer are given the same time for appearance and the persons are made to wait for their turn. It has been pointed out that such actions, apart from causing avoidable inconvenience to the taxpayers/ witnesses/ representatives etc cause great embarrassment to the Government. All officers have been advised to maintain the appointment schedule strictly in spirit with the Citizen’s Charter, 2014 of the Department which specifically provides that the Department shall endeavour “to adhere to the schedule of appointments with taxpayers”. All Supervisory officers, i.e. the CCsIT, CsIT and the Addl. CsIT have been requested to ensure that officers reporting to them strictly comply with this instruction and avoid fixing multiple appointments at the same time. 

For  copy of the memo-Please Click here

Claim of Input Tax Credit, if the sellers found non existing

HIGH COURT OF KARNATAKA

M/S. MILAN PLYWOOD SUPPLIERS

VS.

STATE OF KARNATAKA

Date of order- 10^th July, 2014

Mere existence of tax invoice does not ipso facto lead one to the conclusion that the goods had been sold to the assessee – Assessing Authority should have made an enquiry to find out the genuineness of the transaction as set out by the Tribunal. It is only after such enquiry if the Assessing Authority is satisfied that the transaction in question is genuine one, the assessee has paid the money, he has received the goods and necessary entries are made in the books of accounts of the assessee, then merely because of the dealer has not remitted the tax would not enable the Assessing Authority to deny the benefit to the assessee. 

For full text of the judgment-  Please click here