Tax Cases Weekly Round-Up: 31 July To 6 August, 2022

Supreme Court Advise States To Implement Digital DIN System : Supreme Court To Centre & GST Council Pradeep Goyal vs Union of India Citation: 2022 LiveLaw (SC) 654 The Supreme Court has directed the GST Council to issue advisory / instructions / recommendations to the respective States regarding implementation of the system of electronic (digital) generation of a Document Identification Number (DIN) in the indirect tax administration. The bench comprising Justices MR Shah and BV Nagarathna observed that the system, which is already being implemented by the States of Karnataka and Kerala, would be in the larger public interest and enhance good governance. It will bring in transparency and accountability in the indirect tax administration, which are so vital to efficient governance, the bench said. Service Tax On Composite Works Contracts Not Leviable Prior To2007 Amendment To Finance Act 1994 : Supreme Court Case Name: M/s. Total Environment Building Systems Pvt. Ltd. v. Deputy Commissioner of Commercial Taxes And Ors. Citation: 2022 LiveLaw (SC) 656 The Supreme Court, on Tuesday, held that service tax could not be levied on composite works contracts prior to the introduction of the Finance Act, 2007, which by amending the Finance Act, 1994 had introduced Section 65(105)(zzzza) defining works contracts. The Apex Court noted that in the absence of a charging section and the modalities to levy and assess, service tax cannot be levied on the service element of works contract. Delhi High Court Delhi High Court Directs Income Tax Dept. To Decide TheRectification Applications Filed By Jones LNG Lasalle Case Title: Jones LNG Lasalle Property Consultants Versus DCIT The Delhi High Court directed the income tax department to decide the rectification applications filed by Jones LNG Lasalle Property Consultants. The division bench of Justice Manmohan and Justice Preetam Singh Arora has directed that if any refund is due and payable to the petitioner, it shall be refunded within eight weeks. No Material Found On Search, Income Tax Additions Can't Be Made On Presumption: Delhi High Court Case Title: PCIT Versus Mamta Agarwal Citation: 2022 LiveLaw (Del) 740 The Delhi High Court bench of Justice Manmohan and Justice Manmeet Preetam Singh Arora held that if no incriminating material is found during the course of the search, then no addition can be made in the assessment under Sections 153A and 153C of the Income Tax Act. Show Cause Notice And Reassessment Order Based On Distinct And Separate Grounds, No Details Of Bogus Purchases Were Given: Delhi High Court Quashes The Order Case Title: M/s Best Buildwell Private Limited Versus ITO Citation: 2022 LiveLaw (Del) 755 The Delhi High Court has held that the show cause notice as well as the reassessment order under Section 148A(d) of the Income Tax Act were based on distinct and separate grounds. The department failed to provide the details of the transaction and the vendors from whom the bogus purchases were made. The division bench of Justice Manmohan and Justice Manmeet Pritam Singh Arora has observed that "the show cause notice primarily states that "it is seen that the petitioner has made purchases from certain non-filers." However, no details or any information about these entities were provided to the petitioner. It is not understood as to how the petitioner was to know which of the entities it dealt with were filers or non-filers!" Recovery Of Demand Against Issues Decided In Favour Of AssesseeIs Unwarranted: Delhi High Court Case Title: M/s Expeditors International Of Washingtion, Inc. Versus ACIT Citation: 2022 LiveLaw (Del) 759 The Delhi High Court has held that the recovery of demand against issues decided in favour of the assessee is unwarranted. The division bench of Justice Manmohan and Justice Manmeet Singh Arora has found that the Central Board of Direct Taxes (CBDT) has itself issued an Instruction dated February 2, 1993, giving guidelines for Stay of Demand. One of the guidelines for the grant of complete stay was "if the demand in dispute relates to issues that have been decided in assessee's favour by an appellate authority or court earlier...." Bombay High Court Recovery Of Tax Dues Of A Company From Its Directors Under Section 179 Of Income Tax Act, Cannot Be Invoked Casually: Bombay High Court Case Title: Rajendra R. Singh versus Assistant Commissioner of Income Tax and Ors. The Bombay High Court has ruled that exercise of jurisdiction under Section 179 of the Income Tax Act, 1961 against the director of a public company, to recover the tax dues of the said company, is violative of the principles of natural justice, where the Income Tax Authority has failed to give any opportunity of hearing to the director before applying the principle of 'lifting the corporate veil'. The Bench, consisting of...

Tax Cases Weekly Round-Up: 31 July To 6 August, 2022

Mariya Paliwala

Tags