In the matter of NIPUN A BHAGAT, PROPRIETOR OF STEEL KRAFT INDUSTRIES VERSUS STATE OF GUJARAT, (R/Special Civil Application No. 14931 of 2020), ITC of the writ applicant was blocked under Rule 86A of the CGST Act for recovery of dues outstanding under GVAT Act from the company in which writ applicant was a director.
Once the application had been processed and or order passed, which has attained finality, the respondents cannot escape the plain effect of the same. They also cannot escape the liability of interest that arises on non-compliance of the same.
As per Section 15, there is no provision available which provides for deduction of Management Fee, ESI and EPF contribution. Therefore, in the given case, GST is liable on entire invoice value including EPF and ESI.
A supply of a package consisting of canned foods, sweets, chocolates, cakes, dry fruits, aerated drinks and fruit juices when supplied for a single price is a mixed supply. Each of these items can be supplied separately and is not dependent on any other.
It shall not be a mixed supply if these items are supplied separately;”
The power conferred under Rule 86A is very drastic. Power under Rule 86A should be invoked only if fraudulent ITC or ineligible ITC has been claimed by the assessee and the authority has recorded the reasons for the same in writing.
The authority is bound to record the reasons of invoking Rule 86A in writing and communicate such reasons to the assessee. On receipt of such reasons, the assessee is entitled to make his submission/objection requesting for lifting.
Hon’ble High Court held that power conferred under Rule 86A is very drastic. Power under Rule 86A should be invoked only if fraudulent ITC or ineligible ITC has been claimed by the assessee and the authority has recorded the reasons for the same in writing. In this matter, Hon’ble High Court relied on precedence of apex court in the matter of GKN Driveshafts (India) Limited Vs. ITO reported in (2003) 259 ITR 19 (SC) wherein it was held that in case of reopening of assessment under Section 143(3) of Income Tax Act, the assessee should be afforded an opportunity of hearing and he is entitled to know the reasons for reopening and is also entitled to object to such reopening done by the Assessing Officer. Same analogy is applicable in the given case also, the authority is bound to record the reasons of invoking Rule 86A in writing and communicate such reasons to the assessee. On receipt of such reasons, the assessee is entitled to make his submission/objection requesting for lifting.
The Amneal Pharmaceuticals Private Limited (The Appellant), is providing food facilities to its 500 employees. Canteen is run by a third party, i.e., Canteen Service Provider, to provide food to the employees. The Appellant collects a portion of the price of the canteen service provider from the employees by way of deduction from their salaries. To determine whether GST is payable on the amount collected from the employee, the appellant filed an appeal before GAAR wherein Hon’ble GAAR held affirmative and decided that appellant is liable to pay GST on such amount.
No GST is applicable on contribution received upto INR 7,500 and in case of contribution received in excess of INR 7,500, GST would levy only on additional amount.
An opportunity of hearing shall be granted where a request is received in writing from the person chargeable with tax or penalty, or where any adverse decision is contemplated against such person.
In the matter of M/s Honeywell Automation India Ltd. vs. Commissioner of Trade & Taxes, Delhi (Appeal No: 08-11/ATVAT/2019)
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