NOTICES BY THE GST DEPARTMENT REGARDING TRAN-1

Recently various dealers have received phone calls or notices in relation to the TRAN-1 and the credits taken under it for the CGST benefits available to the traders under section 140 of the CGST Act. As per Section 140(3) subject to conditions a registered person was entitled to take credit of the CGST and thereafter notification was issued providing that predominately the trader will get the benefit under the said section for CGST credit either at the full tax paid earlier or at the rate of 40 / 60 % of GST as the case may be subject to the conditions and filing of the Form TRAN-1 within the stipulated period. Lot of dealers claimed credit filing Form TRAN-1. The provision was worded in a way where the verification of the back chain may not be possible. The department after receiving substantial claims of CGST credit filed through Form TRAN-1 by the dealers was surprised and contrary to the spirit of the GST went on over drive for verification of the credits. The department officials are time and again calling the dealer without issuing any notice asking for the details and verification of the data given in Form TRAN-1. Its appalling to see that calls are made without issuing any notice and only 24 to 48 hours are given to submit the details. The spirit of GST was that no personal interface would be allowed but contrary to it the calls are made and panic is created amongst dealers. The suggestion is to the dealers that the details even if being submitted to the department should be done with caution and complete details and working as done while filing of Form TRAN-1 should be matched and be submitted with documentary support of invoices and payments made and the purchases and sales including stocks. Efforts should be made to take receipt of the documents / details submitted and a cover note covering the documents submitted and the calculation should also be submitted. A note should always be mentioned that if any further detail is required the same may be asked and in case of any contrary finding opportunity of personal hearing should be asked for. In case of any harassment or unwanted details being asked the complaint may be made to the superior authorities. The verification of the TRAN-1 if required by the department should be done in a methodical manner and not by a high handed approach. The culture of asking of details through phone call should be deprecated and should not be promoted by the senior officers of the department and dealers / consultants should also file the details through proper mode.

 

- PRIYAMVADA JOSHI, ADVOCATE

FROM EDITOR'S DESK

The Bank scandals are the talk of the town due to some glaring overlooking of the basic and the fundamental procedure to be followed by an Institution. It is really a sad moment for our regulatory Institutions who have failed in a big way. As far as the tax is concerned the GST is having a different impact in various sectors. Gradually the tax compliance is increasing and even the Government is working for the simplification. We expect that from April, 2018 there may be a single return in GST in place of multiple returns. The Income Tax has not seen many changes in the slab rate in the current Budget and for the individuals it has been a damp budget. However the issue of notices for various reasons both by the Income Tax and the GST departments are increasing and creating anxieties in the mind of the tax payers. We hope that the next Financial Year would be a better year for all. Please continue to send your suggestions and queries at contact@ghiya.in

TIMELINES

RECENT AMENDMENTS

ITAT JUDGEMENTS

Flipkart India Pvt. Ltd. v. Assistant Commissioner of Income-Tax dt. 6th February, 2018 – [2018] 90 taxmann.com 153 (Bengaluru – Trib)
Where assessee company filed petition seeking stay of demand of Rs. 110 crores, however, failed to make out any strong case in its favour on merits of additions made by Assessing Officer, made no effort to file any evidence demonstrating any financial hardship and as regards balance of convenience also failed to make out any case in its favour, stay of demand could not be granted. Read More

Safilo India (P.) Ltd. v. Deputy Commissioner of Income-tax, Circle- 15 (3) (2), Mumbai dt. 12th January, 2018
AO can't make ad hoc disallowance with regards to an international transaction under TP study. Read More

CEVA Freight India (P.) Ltd. v. Deputy Commissioner of Income Tax, Circle-11 (1), New Delhi dt. 18th January, 2018
Where assessee was engaged in providing air and ocean freight forwarding services to AE, a company carrying on road transportation business, could not be accepted as comparable. Read More

Rajat B Mehta v. Income Tax Officer dt. 9th February, 2018
Assessee's claim of deduction under section 54 for investing capital gains in residential house along with furniture and fixtures during relevant year were to be allowed in entirety despite two separate agreement entered into for sale of house and sale of furniture as even if assessee were to buy house, without furniture, consideration would have been same, therefore two agreements could not be considered in isolation and splitting of consideration was only an artificial arrangement. Read More

M/s. Gorbandh Marbles Pvt. Ltd. vs. DCIT dt. 27.12.2017
The assessment in question was framed u/s 153A is not based on any incriminating material found or seized and therefore, the addition made by the AO of Rs. 26,183/- on account of employees Contribution to ESI and PF is not justified and the same is deleted. Read More

FROM THE BENCH

GST

Age Industries Pvt. Ltd. vs. The Assistant State Tax Officer, SGST Department dt. 18.01.2017
No taxable supply when goods were transported on delivery challans so long as authenticity of delivery challan was not doubted and therefore, such goods could not be detained merely for infraction of Rule 138 (2) of State SGST Rules. Thus, detention of goods as manufacturer did not uploaded a declaration in accordance with Rule 138(2) of State SGST Rules was unsustainable. Read More

INCOME TAX

Industrial Infrastructure Development Corporation (Gwalior) M.P. Ltd. v. Commissioner of Income-tax, Gwalior dt. 16th February, 2018
Order of the CIT passed under Section 12A is quasi judicial in nature. Second, there was no express provision in the Act vesting the CIT with power of cancellation of registration till 1-10-2004; and lastly, section 21 of the General Clauses Act has no application to the order passed by the CIT under section 12A because the order is quasi judicial in nature and it is for all these reasons the CIT had no jurisdiction to cancel the registration certificate once granted by him under Section 12A till the power was expressly conferred on the CIT by Section 12AA(3) of the Act w.e.f. 1-10-2004. Read More

SERVICE TAX

Commissioner of Central Excise & Service tax v. Ultra Tech Cement Ltd. (SC) dt. 1st Fenruary, 2018
Cenvat Credit on goods transport agency service availed for transport of goods from place of removal to buyer's premises would not be admissible to assessee. Read More

Commissioner of Service Tax, Mumbai vs. Shri Krishna Chaitanya Enterprises, Mumbai dt. 25th January, 2018
Builder not Liable to pay Service Tax for providing Maintenance Services under Statutory Obligation. Read More

VAT

Parisons Foods (P.) Ltd. v. Joint Commissioner of Commercial Taxes dt. 18th January, 2018
'Bakery shortening' being an edible mixture or preparation of vegetable oils would fall under HSN heading 1517 which comes under residual entry of S.R.O. No. 82/2006 under KVAT act and exigible to tax at rate of 12.5 per cent. Read More

MISCELLANEOUS

 

• Press Release dated 16.02.2018 - Circular on Orders of Supreme Court, High Courts and CESTAT accepted by the Department and on which no review petitions, SLPs have been filed. Read More
• India and Iran signed in New Delhi today an Agreement for the Avoidance of Double Taxation (DTAA) and the Prevention of Fiscal Evasion with respect to taxes on income. Read More