Article

Tata Motors’ AAR decision: A fix to the age-old strife?

By Tanya Garg

Employee recoveries have always been a contentious issue, both in pre-GST era and under GST. The article in this issue of Tax Amicus elaborately discusses a recent decision of Maharashtra AAR in the case of Tata Motors, where the Authority has held that the provision of bus facilities by the employer to the employee on a nominal price falls under ‘employer-employee’ relation and is not a ‘supply’. Analysing whether the said ruling will be beneficial for the assessees, the author discusses the effect of this ruling on other doctrines being followed in respect of employee recoveries. Apart from deduction from salary of employees, the article discusses various issues in situations like where there is no recovery from employees or an amount is recovered from employees on behalf of the vendors or when direct payment is made by employees to contractor/vendor. According to the author, the issues need to be properly addressed by the authorities by way of proper clarification...

Goods & Services Tax (GST)

Notifications and Circulars

• Interest payable on net cash liability from 01-07-2017 – CBIC instructs field formations to keep SCNs in call book
• GSTR-4 – Reduction of late fee and extension of due date for filing by specified persons
• GSTR-10 – Late fee reduced if return furnished between 22-09-2020 till 31-12-2020
• Invoices under Section 31(7) – Time limit extended till 31-10-2020

Ratio decidendi

• Provisional attachment – Pendency of proceedings under specified provisions is mandatory – Punjab and Haryana High Court
• SEZ unit entitled to claim refund of unutilized ITC distributed to it by ISD – Gujarat High Court
• Appeal – Time period to file appeal starts only when impugned order is uploaded on GST portal – Gujarat High Court
• Refund of ITC on input services due to inverted duty structure, not available – Madras High Court
• Cash amount can be seized under Section 67 of the CGST Act – Madhya Pradesh High Court
• Detention of goods and vehicle – Transporter has locus standi to file petition for release – Karnataka High Court
• No detention when e-way bill mentions consignee as unregistered – Kerala High Court
• E-way Bill – Effective value of goods to be seen – Kerala High Court

Customs

Notifications and Circulars

• FTAs – Bill of Entry formats revised to enforce requirements of CAROTA Rules
• Merchandise Export from India Scheme – Ceiling limit and sunset notified
• Standard Unit Quantity Codes mandatory from 1-11-2020 for all exports/imports
• Faceless assessment for import of goods to be rolled out pan India from 31-10-2020
• Courier exports – Auto LEO to be given under Express Cargo Clearance System
• Onion exports prohibited

Ratio decidendi

• Retrospectivity of an amendment – Addressing an anomaly is not rectification of error – Supreme Court
• Date of effect of notification – Provisions of Section 25(4) of Customs Act, as amended by Finance Act, 2016, are arbitrary – Gujarat High Court
• No power to freeze bank account before amendment in Customs Section 110 in 2019 – Rajasthan High Court and Bombay High Court
• Demand under Section 28AAA not sustainable without challenging assessment order – CESTAT Mumbai
• Customs cannot deny benefit where licensing authority not taking any action – SFIS benefit available to golf carts – CESTAT Mumbai
• Interest for delayed refund payable after 3 months from filing claim - Defective refund application is only irregularity and not illegality – Karnataka High Court

Central Excise, Service Tax & VAT

Ratio decidendi

• Supply of pipes and measurement equipment, charged as ‘gas connection charges’, liable to service tax under ‘Supply of Tangible Goods for Use’ – Supreme Court
• SVLDR Scheme – Designated Authority to only verify correctness of declaration and not adjudicate – Karnataka High Court
• SVLDR Scheme – Department should take liberal approach – Kerala High Court
• SVLDR Scheme – Mentioning of dues payable in clause 9.1 of Form SVLDRS-1 instead of clause 9.4, curable – Gauhati High Court
• Valuation – Related parties – Reporting transactions as related party transaction in balance sheet is irrelevant – CESTAT Ahmedabad
• Cenvat credit of service of short-term accommodation in hotel, when available – CESTAT Mumbai
• Bihar VAT – Industrial Incentive Policy 2006 covers subsidy of Entry Tax also – Patna High Court
• Cenvat credit available on re-insurance services availed by general insurance service provider – CESTAT Delhi