LKS Indirect Tax Amicus, October 2024

Goods and Services Tax (GST)

Notifications and Circulars

• Central Goods and Services Tax Rules, 2017 amended to enforce recommendations of 54th GST Council Meeting
• GST clarifications issued in October 2024

Ratio decidendi

• Input Tax Credit is available on construction of ‘plant’ for letting out – Supreme Court
• Refund of IGST on exports – CGST Rule 96(10) declared ultra vires IGST Section 16 – Kerala High Court
• Registration need not be cancelled for violation of Rule 86B restricting ITC utilization – Rule 86B having no statutory backing appears to be ultra vires – Himachal Pradesh High Court
• Electronic Credit Ledger cannot be blocked for an amount exceeding the credit available – High Courts of Delhi, Gujarat and Orissa
• Demand proceedings finalized under Section 73 cannot be reopened under Section 74 unless SCN alleges fraud, etc. – Allahabad High Court
• Refund of IGST on exports when amount not included in GSTR-1 – High Court allows manual processing of refund – Gujarat High Court
• Right to appeal not taken away if entire amount demanded in Section 129(3) order paid – Gauhati High Court
• Recovery of tax during an investigation when is illegal – Department’s contention of deposit after self-ascertainment when wrong – Karnataka High Court
• No IGST on ocean freight even on FOB imports when IGST paid on value of goods including freight and insurance – Gujarat High Court
• Provisional attachment cannot extend beyond one year from date on which it was first made – Kerala High Court
• Principles of natural justice prima facie violated if notice for blocking of credit ledger given by non-competent authority, even though order subsequently issued by competent authority – Rajasthan High Court
• Location of supplier is determined by place of business from which supply made and not the place of bank account where payment received – Delhi High Court
• Authorisation of officers – Initiation of enquiry or issuance of summons is not initiation of proceedings for Section 6(2)(b) – Kerala High Court
• Addition of additional place of business in registration certificate – NOC from property owner is not required and absence thereof cannot be a ground for cancellation – Punjab & Haryana High Court
• Natural justice – Personal hearing – Receipt of reply to SCN is not grant of ‘opportunity of hearing’ – Madhya Pradesh High Court

Customs

Notifications and Circulars

• Rice exports – Export duty removed on certain categories while MEP removed for non-basmati white rice
• Imports under Free Trade Agreements with third party invoices clarified
• Digitization of specified procedures relating to customs bond warehousing
• India-UAE CEPA – Retrospective issuance of certificates of origin clarified
• RoDTEP – Mandatory filing of Annual RoDTEP Returns
• RCMC not required for claiming benefit under RoDTEP, RoSCTL and Drawback schemes
• Import/re-import of exhibits and samples – No requirement of authorization or registration under Import Monitoring Systems
• SCOMET – Appendix 10M amended to include more items under GAICT of SCOMET items
• Procurement of Acetic Anhydride by AA holder from SEZ – NOC from Drug Controller and Narcotics Commissioner not required

Ratio decidendi

• EOU – Department cannot be permitted to raise eyebrows on decision of Development Commissioner – Telangana High Court
• Catalyst 3850 series Ethernet Switches are eligible for concessional BCD under Notification No. 57/2017-Cus. – CESTAT Mumbai
• FTA benefit not deniable only for unapproved correction in Country-of-Origin certificate – Doctrine of substantial compliance followed – CESTAT Chennai
• Term ‘manufacture’ in exemption notifications subjected to IGCR conditions, must be interpreted only in terms of IGCR Rules – CESTAT New Delhi
• Router Line Cards for network routers are not classifiable under CTI 8517 62 90 – CESTAT New Delhi

Central Excise, Service Tax and VAT

Ratio decidendi

• Venture Capital Funds rendering services of asset management are not liable to service tax – Supreme Court
• Rebate claim – Non-filing of declaration, ARE-2 and input-output ratio when is not fatal – Bombay High Court
• Sabka Vishwas (LDR) Scheme – Benefit not deniable even if penalty amount mentioned in declaration while the same was not quantified – Gujarat High Court
• Travel agent service is provided to sub-agents/customers and not to airlines – Use of phrase ‘inclusive of all taxes’ not automatically means that tax recovered – CESTAT New Delhi
• Exemption not deniable for use of inputs other than those stipulated if notification does not use words ‘wholly’, ‘entirely’, or ‘exclusively’ – CESTAT New Delhi
• Investment in mutual funds is not ‘service’ under the Finance Act, 1994 – CESTAT New Delhi
• Cenvat credit – Restrictions under second proviso to Rule 3(4) are not applicable to input service credit received through ISD invoices – CESTAT Chandigarh

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