This is the 2nd Part of the set of videos on “GST Optimisation”. It explains how indirect tax cascading still continues in India even after implementing GST. The video covers specific situations in which tax cascading happens. This video is meant for the general public and not exactly the tax experts. So the language is simpler devoid of sections, rules, technical expressions and tax jargon.

https://www.youtube.com/watch?v=pohxDYOjLNU&t=226s

This is the first part of a three part video set on Tax Optimisation, more specifically GST Optimisation. Its created for those who are not too familiar with taxation and yet keen to understand and benefit by optimising on taxes. This can be useful for people handling indirect taxation too as the aim of these videos is to conceptually clarify the subject.

https://youtu.be/tWWb9ClOOZg

"The Indian GST Story" by Anthony Fernandes - Founder of Tax Quotient


1st June 2019

GST Council likely to tweak textiles rates in line with global markets

5th June 2019

The GST Council appears to be poised to make changes in GST rates for textiles to remove tax rate anomalies in textiles. The issues are mainly differential tax rates and refund to exporters. 

This is likely to happen in the next GST Council Meeting to be held in the first fortnight.   Currently there are 4 GST rates - 5%, 12%, 18% and 28% (if we ignore the rates on precious stones - 0.25% and Gold - 3%).

While a single rate it unlikely the number of rates reducing to 3 slabs may be possible.

Finance Ministry clarifies in a press note there will be no change in due date to file annual GST return

5th June 2019

The Union Finance Ministry, issued a detailed clarification through a press note on the annual return to be filed for Goods & Services Tax (GST). The last date to file returns will continue as June 30.

Read the press note dated 4th June 2019.
 

The next indirect tax reform is aimed at customs procedures to boost trade and improve ease of doing business

4th December

The Chairman of CBIC, Mr S Ramesh elaborated that current customs procedures will be replaced by processes in line with best practices of the World Customs Organisation (WCO). This will entail elimina

 

Recent Court / Tribunal Judgements

 National Anti-profiteering Authority

Decisions for the National Anti-Profiteering Authority :

  1. 1. Shri Ankur Jain & DG Anti-Profiteering, CBIC Vs M/s Kunj Lub Marketing Pvt. Ltd. : Case No. : 10/2018 : 8th October, 2018
  2. 2. Sh. Jijrushu N. Bhattacharya & DG Anti-Profiteering, CBIC  Vs M/s NP Foods (Franchisee M/s Subway India) : Case No. 9/2018 : 27th September, 2018
  3. 3. Miss Neeru Varshney & DG Anti-Profiteering, CBIC Vs M/s Lifestyle International Pvt. Ltd. : Case No. 8/2018 : 25th September, 2018
  4. 4. Shri Sukhbir Rohilla along & 108 other Applicants & DG Anti-Profiteering, CBIC Vs M/s Pyramid Infratech Pvt. Ltd. : Case No. 7/2018 : 18th September, 2018  
  5. 5. Shri Pawan Sharma & DGAP, CBIC Vs M/s Sharma Trading Company, Jaipur: Case No. 6/2018 : 7th September, 2018
  6. 6. Dinesh Mohan Bhardwaj Vs M/s Vrandavaneshwree, Automotive Private Limited : Case No. 1/2018 : 27th March 2018

 CESTAT Decisions

 

18th October, 2018 : CESTAT Mum : UPS Jetair Express Private Limited   Vs Commissioner of CGST, Mumbai East 

Revenue denied CENVAT credit only on the ground invoices didn't mention the registration number of the service provider. No other allegations were made regarding receipt of input services, eligibility etc.

Held : This is merely a procedural lapse. It is settled that CENVAT credit can't be denied on mere technicalities or procedural lapses.

CENVAT credit allowed, extended period of limitation not applicable.

Ed's comment : Isnt it surprising that a Senior Officer like Prin. ADG, DGPM, WRU, still needs to catch up with decades old case law regarding Modvat and Cenvat? It's repeatedly held procedural lapses aren't reason enough to deny credit. How will the dept reduce litigation? Should Tribunal for fairness?

18th October, 2018 : CESTAT Ahd : M/s Auto Care Lubricant Vs C.C.E. & S.T.-Vapi
The Tribunal relying on an earlier decision in Castrol India Ltd, held :
“The authorities under the Standards of Weights and Measures Act are the best judge to decide as to whether a product is required to be affixed with a MRP under the said Act or not. If said authority has clarified that 210 ltr. barrel are not required to be affixed with MRP, it was obligatory on the part of the Excise authority to accept such decision of Controller of Legal Metrology authority….., it was not open to the Excise authority to doubt the decision of the authority under Standards of Weights and Measures Act and to proceed independently ….”

18th October 2018 : CESTAT Ahd : M/s Javiya Finance Services, Javiya Marketing Vs C.C.E.& S.T.- Surat-I
The appellant were providing service of identifying customers for car loans and receiving commission from ICICI Bank. This was to be taxed under Business Auxiliary Services (BAS).  

The appellants admitted taxability but argued they were under bonafide belief the services are not taxable and so extended period of limitation should not be invoked.
Held : "The definition of Business  Auxiliary  Services  is  very  clear  and  there  is  no  scope  of interpretation. The definition specifically includes the service of promotion or marketing of any service of the client within its ambit." Appeals dismissed.

 

 12th Oct : CESTAT Mum : Tahnee Heights CHS Ltd. Vs Commissioner of CGST, Mumbai South : Held : "The appellant also do not provide any service to its members, who pay the amount towards their share of contribution, for occupation of the units ....the explanation furnished under clause 3(a) in Section 65B of the Act will not designate the appellant as an entity, separate from its members....the case of the appellant is not confirming to the requirement of 'service', as per the definition contained in Section 65B(44) of the Act."

10th Oct : CESTAT Ahd :  L & T Ltd. etc Vs C.C.E. Ahd Appellants argued the law and IS specifications had changed for their product "concrete mix" made at site. It was eligible for the exemption making the earlier Supreme Court judgement in their own case irrelevant.

Tribunal ruled that there is no change in the  C.Ex Tariff Heading description as far as ready mix concrete is concerned. There is no mention of any IS Specification anywhere in the SC judgement. So changes in IS Specifications cannot be used to distinguish the decision of Hon’ble Apex Court. Demand beyond the period of limitation set aside. Personal penalty quashed as this is a case of interretation.

11th Oct : CESTAT Chennai : M/s. Pepsico India HPL Vs Commr of GST & CE, Chennai Outer : The appellants had paid excess central excise duty for which they utilised the CENVAT credit. On realizing this they suo moto took re-credit of the excess amount debited from the Cenvat account.

Held:  Following the said decisions of the High Courts, The impugned order and demand was set aside.

3rd October, 2018 : Mayur Printers & Ors Vs C.C.E.& S.T. Surat-I :

Two points were raised in the Rectification of Mistake Application. First, credit denied on defective gate passes and second, there was no findings in respect of cenvat credit lying in their account which should have been adjusted against the demand. Tribunal held - credit admissible if established through evidence. Matter remanded.

3rd October, 2018: CESTAT Ahd C.C., Kandla Vs Reliance Port & Terminals Ltd.: Revenue argued thatEPCG benefit was not available for “consumables” which was deleted from Not 97/2004 Cus on 21.5.2007. “Consumables” are not “capital goods”.  Respondents submitted the imported items were “used for installation of Crude. Product pipelines, therefore, all the goods used during the initial installation of pipeline shall be categorized as capital goods only.” The Tribunal dismissed the appeal on limitation without entering the merits of the case as the Revenue had abandoned the argument of limitation.

 

 

High Court Judgements

 

2nd July, 2018  : Allahabad High Court : Hamdard (Wakf) Labs Vs Commr Of Commercial Taxes : The High Court upholds the Tribunal order and holds that "Sharbat "Rooh Afza" is not unclassifiable under Schedule-V of the Act and liable to tax @ 12.5%. It is neither fruit juice nor fruit drink nor processed fruit.

2nd July, 2018 :  Delhi High Court : JOYCE KAROUNG Vs NARCOTICS CONTROL BUREAU : Relying on the SC judgment in Babua v. State of Orissa, (2001) 2 SCC 566 the High Court concluded the petitioner is not prima facie not guilty. Also, liberty of a citizen must be balanced with the interest of the society especially where narcotic drugs and psychotropic substances are involved. It is alleged that this is not the first offence.

Click for earlier Judgements in 2018

Indian Courts

 

 
1 Supreme Court of India http://supremecourtofindia.nic.in
2 Allahabad High Court http://www.allahabadhighcourt.in
3 Andhra Pradesh High Court http://hc.ap.nic.in
4 Bombay High Court http://bombayhighcourt.nic.in
5 Calcutta High Court http://calcuttahighcourt.nic.in
6 Chhattisgarh High Court http://highcourt.cg.gov.in
7 Delhi High Court http://delhihighcourt.nic.in
8 Gauhati High Court http://ghconline.nic.in
9 Gujarat High Court http://gujarathighcourt.nic.in/index.asp
10 High Court of Bombay at Goa http://hcbombayatgoa.nic.in
11 Himachal Pradesh High Court http://hphighcourt.nic.in
12 Jammu & Kashmir High Court http://jkhighcourt.nic.in
13 Jharkhand High Court http://jharkhandhighcourt.nic.in
14 Kerala High Court http://highcourtofkerala.nic.in
15 Madhya Pradesh High Court http://mphighcourt.nic.in
16 Madras High Court http://www.hcmadras.tn.nic.in
17 Orissa High Court http://www.orissahighcourt.nic.in
18 Patna High Court http://patnahighcourt.bih.nic.in
19 Punjab & Haryana High Court http://highcourtchd.gov.in
20 Rajasthan High Court http://hcraj.nic.in
21 Sikkim High Court http://highcourtofsikkim.nic.in

 


Tax Risk Management Part 1

An Introduction

 

Risk comes from not knowing what you’re doing. 
- Warren Buffet

Read the Article

 

Tax Risk Management Part 2

Tax Risks as Black Swan Events!

If you were asked "What 'tax risks' you perceive in your business?" What would be your answer?

Read the Article

 

 

Indirect Tax Risk Management

Indirect Risk Tax Management
 

 

 

 

Economic Survey of India 2017-18