Skip to main content

Power of arrest is to be used with great circumspection and not casually

In Make My Trip (India) Pvt. Ltd v. Union Of India & Ors., writ Petitions were filed by two entities operating on-line platforms/web portals raise important questions involving powers of Directorate General of Central Excise Intelligence (DGCEI) of arrest, investigation and assessment of service tax under provisions of the Finance Act, 1994. In both writ petitions, applications were filed for interim directions to restrain DGCEI from taking any coercive steps against the entities and their officers.

Scheme of provisions of Finance Act 1994 (FA), do not permit DGCEI or for that matter Service Tax Department (ST Department) to by-pass procedure as set out in Section 73A (3) and (4) of Act before going ahead with arrest of a person under Sections 90 and 91 of Act. Power of arrest is to be used with great circumspection and not casually. It is not to be straightway presumed by DGCEI, without following procedure under Section 73A (3) and (4) of Finance Act, that a person has collected service tax and retained such amount without depositing it to the credit of the Central Government. Where an assessee has been regularly filing service tax returns which have been accepted by ST Department or which in any event have been examined by it, as in case of two Petitioners, without commencement of process of adjudication of penalty under Section 83 A of Act, another agency like DGCEI cannot without an SCN or enquiry straightway go ahead to make an arrest merely on suspicion of evasion of service tax or failure to deposit service tax that has been collected.

Article referred: http://roundup.manupatra.in/asp/content.aspx?issue=77&icat=1

Comments

Post a Comment

Most viewed this month

Appellate authorities under Special Statutes cannot be asked to condone delay

Madras High Court in R.Gowrishankar vs. The Commissioner of Service Tax has held that Appellate authorities cannot be asked to condone the delay, beyond the extended period of limitation A Division Bench comprising of Justices S. Manikumar and D. Krishnakumar, made this observation while considering an appeal filed against Single Bench order declining to set aside the order made in the condone delay petition filed by the petitioner to condone 223 days in filing the appeal before the Commissioner of Service Tax (Appeals). Article referred: http://www.livelaw.in/appellate-authorities-special-statutes-cannot-asked-condone-delay-beyond-extended-period-limitation-madras-hc/
Post a Comment
Read more

'Seize assets to pay damages to accident victim'

Her story might be an inspiration for the physically challenged but justice has remained elusive for her. In 2008, a bus accident left research engineer S Thenmozhi, 30, paraplegic. In April 2013, the motor accident claims tribunal directed the Tamil Nadu State Transport Corporation (TNSTC) to provide her a compensation of 57.9 lakh. However, TNSTC refused to budge and on Tuesday a city court ordered attaching of movable assets of the transport corporation. Thenmozhi was employed in C-DOT, a telecom technology development centre in Bangalore. On July 21, 2008, she was coming to Chennai in a private bus. Around 2am, the bus had a flat tyre and the driver parked it on the left side of the road near Pallikonda in Vellore district on the Bangalore-Chennai highway. While the tyre was being changed, a TNSTC bus of Dharmapuri division hit the stationary bus. The rear part of the bus was smashed and passengers were injured. Thenmozhi who had a seat at the back of the bus suffered...
Post a Comment
Read more

Mumbai ITAT rules income of offshore discretionary trust is subject to tax in India

The Mumbai Income Tax Appellate Tribunal (ITAT) has recently determined the following issue in the affirmative in the case of Manoj Dhupelia: Should the income of an offshore discretionary trust be subject to tax in India, if no distributions have been made to beneficiaries in India? The question arose from appeals filed by individual beneficiaries in relation to a Lichtenstein-based trust, the Ambrunova Trust and Merlyn Management SA (the Trust) with the ITAT. It is important to note that the individuals in this case were amongst those first identified by the Government of India (GOI) as holding undeclared bank accounts in Lichtenstein. The ITAT ruling raises the following issues: Taxation of Trust Corpus: ITAT classified the corpus of the trust as "undisclosed income" and declared it taxable in the hands of the beneficiaries. Taxation of Undistributed Income: ITAT refused to draw a distinction between the corpus and undistributed income from the trust and declared i...
Post a Comment
Read more