It was observed that the personal hearing notice does not indicate that any reason justifying the exercise of power of rectification was pointed out to the assessee
By Yogitha S. Yogesh – On October 20, 2024 10:08 am – 2 mins read
In a significant case, the Kerala High Court stated that rectification order is not sustainable if it does not provide any reason justifying the exercise of power of rectification. It was observed that the personal hearing notice does not indicate that any reason justifying the exercise of power of rectification was pointed out to the assessee.
Krishna Agencies, the petitioner has approached the Court being aggrieved by order rectifying certain alleged mistakes in order issued under Sections 73/74 of the Central Goods and Service Tax ( CGST/SGST ) Acts for the year 2017-2018. The petitioner has challenged on a short ground. It was submitted that the competent authority proceeded to rectify order without informing the petitioner as to the reason that prompted the exercise of the power of rectification.
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The Counsel for the department referred to the statement filed by the department and attempted to justify the rectification order based on the provisions of Section 161 of the Central Goods and Services Tax/State Goods and Services Tax Acts, 2017.
The bench noted that the original order, dated 26.12.2023, was communicated to the assessee on 29.12.2023. Subsequently, on 06.03.2024, a notice for a personal hearing was issued to the assessee.
The single bench of Justice Gopinath P. observed that the personal hearing notice does not indicate that any reason justifying the exercise of power of rectification was pointed out to the assessee. Therefore, the assessee is right in contending that the rectification order cannot be sustained in law.
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Section 161 of the Central Goods and Services Tax ( CGST ) Act, 2017, authorises a Proper Officer to rectify such errors. These errors typically include clerical mistakes, arithmetical errors, omissions, or other inadvertent mistakes that do not require extensive interpretation or investigation.
In view of the above, the bench quashed both the notice and the rectification order. Aji V. Dev, H. Abdul Lathief and Alan Priyadarshi Dev appeared for the petitioner. The respondent was represented by P.R. Sreejith.To Read the full text of the Order CLICK HERE
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KRISHNA AGENCIES vs THE SUPERINTENDENT
CITATION: 2024 TAXSCAN (HC) 2179
Counsel for Appellant: AJI V.DEV, H.ABDUL LATHIEF, ALAN PRIYADARSHI DEV
Counsel for Respondent: P.R.SREEJITH
Topics
CGSTJustice Gopinath PKerala High CourtSection 161 of CGST Act
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CBDT Circular on Monetary Limits in Filing Appeal/SLP Not Applicable on International Tax Appeal Involving DTAA: Punjab & Haryana HC [Read Order]
The court held that the case does not falling within exception to clause l(ii) of para 3.1 which is only with respect to litigation arising out of disputes related to TDS/TCS matters in both domestic and international taxation charges.
By Yogitha S. Yogesh – On October 19, 2024 7:41 pm – 2 mins read
In a recent case, the Punjab and Haryana High Court has held that the circular issued by the Central Board Of Direct Taxes (CBDT) prescribing monetary limits to file appeal/SLP is not applicable on international tax appeal involving the provisions of Double Taxation Avoidance Treaty (DTAA).
The Revenue has strenuously argued that the case does not fall within the ambit of Circular bearing No.9/2024 dated 17.09.2024 issued by the Central Board of Direct Taxes on the basis of monetary limit, as the same falls in exception as per para 3.1 of Circular No.5/2024 dated 15.03.2024.
Upon a pointed query raised by the Court regarding the issue having been finally adjudicated by the Supreme Court in Engineering Analysis Centre of Excellence Private Limited vs. Commissioner of Income Tax and Anr., reported in (2022), it has been submitted by counsel that the review petition has been filed with regard to the said judgment.
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The department has argued that the case does not fall within the ambit of Circular bearing No.9/2024 dated 17.09.2024 issued by the Central Board of Direct Taxes on the basis of monetary limit, as the same falls in exception as per para 3.1 of Circular No.5/2024 dated 15.03.2024. Clause l(ii) of para 3.1 of Circular No.5/2024 to submit that the issue involved in the present case relates to Double Taxation Avoidance Agreement and would therefore fall in the exceptions.
The division bench of Justice Sanjeev Prakash Sharma and Justice Sanjay Vashisth has observed that the monetary limits prescribed in Circular No. 5/2024 shall not be applicable on in respect of litigation arising out of disputes related to TDS/TCS matters in both domestic and International taxation charges where dispute relates to the determination of the nature of transaction such that the liability to deduct TDS/TCS thereon or otherwise is under question.
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While dismissing the departmnet’s appeal , the court held that the case does not falling within exception to clause l(ii) of para 3.1 which is only with respect to litigation arising out of disputes related to TDS/TCS matters in both domestic and international taxation charges, wherein disputes relating to appeals of international taxation charges with the applicability of provisions of Double Taxation Avoidance Agreement would fall. Urvashi Dhugga appeared for the appellant and Deepak Chopra appeared for the respondentTo Read the full text of the Order CLICK HERE
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