Works Contract
4 articles
CENVAT Credit on Capital Goods Supplied Under a Works Contract Is Not Barred by the Contractor's Valuation Under Rule 2A: CESTAT Chennai in Toshiba JSW Power Systems
A Chennai Bench of the Tribunal accepted that the supply and erection orders were one works contract, yet allowed the recipient's credit, setting aside a notice demand of Rs.1,93,97,137. The credit bar in the Explanation to Rule 3 of the CENVAT Credit Rules, 2004 does not follow the goods into the recipient's hands, and the extended period was held unavailable.
15 min readA Reply Handed Over at the Hearing Must Be Read: Orissa High Court Sets Aside Section 74 Order That Treated a Manually Filed Reply as No Reply
A Division Bench of the Orissa High Court has quashed a Section 74 order for 2019-20 that proceeded as if no reply existed, although the Superintendent had signed an acknowledgment of the contractor's written reply. The Court held that Rule 142(4) of the CGST Rules does not make electronic filing a condition of being heard, remitted the matter, and left the limitation and jurisdiction questions open.
13 min readState Registration Is No Shield: Delhi High Court Applies Armour Security to Uphold DGGI's Cross-Empowerment in a Multi-State Works-Contract ITC Chain
A works-contract subcontractor holding three separate GST registrations faced a combined demand of over five and a half crore rupees across three states, arising from an alleged fake-invoicing chain traced through its sub-subcontractor. The Delhi High Court rejected its challenge to DGGI's jurisdiction over State-registered taxpayers and to the Delhi North Commissionerate's authority to adjudicate, relegating the reasons-adequacy and Circular 171 defences to the Section 107 appeal, while extending interim protection to file it.
13 min readOrder-in-Appeal Is Binding Until Reversed: Telangana High Court Quashes a GST Refund Rejection Founded on a Department's Mere Decision to Appeal
A GST refund of Rs. 19.33 crore, consequential to an appellate order that had already set aside the underlying demand, was rejected because the Department had internally decided the appellate order was 'not legal and proper' and intended to challenge it before the GST Appellate Tribunal — an appeal it had not yet even filed. The Telangana High Court held that an Order-in-Appeal remains binding under Section 107(16) of the CGST Act until actually stayed, modified or set aside, and that a refund can be withheld pending further proceedings only through the specific mechanism of Section 54(11), not by administrative fiat.
13 min read