Judiciary updates-03rd Dec 2021 (Income tax, GST & Corporate Laws)

Income Tax

Supreme Court dismisses Transfer Petition as withdrawn

 Rajinder Kumar Vs Central Board of Direct Tax & Anr. (Supreme Court of India) dated 15/11/2021

No addition of unaccounted investment if transactions were via Banking Channels

 ITO Vs Vaneet Mittal (ITAT Chandigarh) dated 22/10/2021

Petitioner entitled to avail NIL rate of withholding tax on aircrafts leased to AIL – Delhi HC

Celestial Aviation Trading 64 Limited Vs ITO (Delhi High Court) dated 12/11/2021

No deemed dividend on loan given on interest to Sister Concern for business

TCI Exim Pvt. Ltd. Vs ACIT (ITAT Delhi) dated 02/11/2021


HC directs GST dept to reconsider registration of petitioner as composite dealer instead of regular dealer

Varsha Ritu Vs Union of India (Rajasthan High Court, Jodhpur Bench) dated 08/11/2021

HC Quashed order Cancelling GST Registration without Opportunity of Hearing

 S.S. Traders Vs State of U.P And 3 Others (Allahabad High Court) dated 02/11/2021

IGST Payable on supply of Import services under RCM

 In re GSPC(JPDA)LTD (GST AAR Gujarat) dated 06/09/2021

GST Evasion accused released on regular bail after 2½ years

Manish Vs State of Haryana (Punjab and Haryana High Court) dated 29/10/2021

Corporate Laws

Accident claim benefit available only when accident took place after reviving of policy

Life Insurance Corporation of India Vs Sunita (Supreme Court of India) dated 29/10/2021

HC expunges adverse remarks made by Customs Commissioner against an Advocate

 M. S. Srinivasa Vs Union of India (Karnataka High Court) dated 10/11/2021

DRI intercepts 2 passengers with illicit foreign currency worth Rs 3.7 crore at Mumbai International airport (MoF Press Release 26 Nov 2021)

Under Operation Cheque Shirts, using data analytics, Directorate of Revenue Intelligence developed specific intelligence on two passengers intending to smuggle foreign currency outside India. DRI officers intercepted these two passengers at the Chhatrapati Shivaji Maharaj International Airport, Mumbai, in the early hours of 26th November, 2021.  They were scheduled to travel to Sharjah. Examination of their baggage yielded foreign currency in the form of US Dollars and Saudi Dirhams, valued at Rs 3.7 crore.


The foreign currency was found concealed deep in ingeniously designed false bottoms of the carry-on luggage. The mode and manner of concealment would have made the detection difficult in ordinary baggage scans.

The two intercepted passengers had no documents for the illicit possession or for legal export of the said foreign currency. The foreign currency recovered from these passengers has been seized in terms of Section 110 of the Customs Act, 1962. Further investigations in the matter are on.

Besides amounting to “smuggling” in terms of the Customs Act, illicit export of foreign currency provides a means for laundering proceeds of unlawful and criminal activities. Further, it also poses a grave threat to national economy and national security.

DRI maintains an active vigil and operational readiness to check the smuggling of foreign currency, gold, narcotics and other contraband goods into and out of India. This was the fourth such case of large foreign currency seizure at an international airport, in the last one and a half months.

CBIC Chairman inaugurates Customs & GST pavilion at 40th India International Trade Fair (MoF Press Release dated 15 Nov 2021)

Shri M. Ajit Kumar, Chairman, CBIC, inaugurated the Customs & GST pavilion here today at Hall no.12 of Pragati Maidan, New Delhi.

Central Board of Indirect Taxes and Customs (CBIC) has set up Customs & GST pavilion in the 40th edition of India International Trade Fair. The CBIC has been putting up pavilions in the IITFs since 2012 with an objective to educate visiting members of trade & public about compliance requirements under GST and Customs Acts and to inform them about various trade facilitation measures which the Department periodically takes.

Aligned to ITPO’s theme of Atmanirbhar Bharat, theme-based events on each day are being organised in the Customs & GST pavilion. Sessions on Government of India initiatives to encourage ‘Make in India’ such as Manufacturing and other Operations in Warehouse Regulations (MOOWR) Scheme, Production linked Incentive (PLI) Scheme and Import of Goods at Concessional Rate of Duty Rules, 2017 (IGCR, 2017) are being organised. CBIC’s initiatives on leveraging technology in Customs & GST, cross-border e-Commerce, and securing transactions in Customs will also be showcased and discussed. Various Industry partners such as Invest India, EICI, FIEO and CII have associated with CBIC to organise these theme-based events.

Six Helpdesks viz. GST, Customs, Authorized Economic Operator (AEO) scheme, GSTN and Systems have been setup in the pavilion. Officers from the concerned departments will be available to discuss and suggesting resolution to the issues faced by the tax-payers and visitors. Based on the theme of taxation, the pavilion will also engage and educate general public through quiz competitions, nukkad nataks, pantomimes etc. Some of the illustrious and internationally awarded sports persons who are employed with Department will also be available for interaction with public.

All Covid-19 protocols are being followed at the Customs & GST pavilion.

2 arrested with 12.9 kg of heroin worth Rs 90 crore by Customs officials at IGI airport (MoF Press Release dated 13th Nov 2021)

Scaling up its fight against the drug smugglers and syndicates, Customs officers at IGI Airport, New Delhi in yet another successful operation seized a cumulative quantity of 12.9 Kg of Heroin from two Ugandan Nationals who had arrived from Nairobi (Kenya) via Abu Dhabi during the intervening night of 12th and 13th November 2021. The value of the seized Narcotic is approximately pegged at Rs 90 Crore as per the prevailing International prices.

The narcotic and the smugglers had passed through several jurisdictions including Uganda, Kenya and India, before being intercepted. The said heroin was concealed in the false bottom of their check-in luggage.

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A total of 12.900 Kg of crystalline heroine was recovered from two lady Ugandan Passengers, from their three suitcases.

The baggage of the passengers was also sniffed by the canines of the Dog Squad of the Indian Customs stationed at the Delhi Airport and the canine indicated the presence of some narcotic substance in the baggage. On detailed personal and baggage search and questioning, the lady passengers admitted to having brought the heroine in their checked in baggage by ingeniously concealing the Heroin in the specially made cavities beneath the fake layer of fibre-plastic base on both the sides of the suitcases. It was vacuum packed in plastic and paper bags containing crystalline form of off-white-coloured powder/granules of Heroin.

During the questioning, one of the lady passengers revealed that she was introduced to a Kenyan national, who had promised her money in exchange of delivery of certain goods in Delhi. Thus, on this invite, the lady passenger travelled to Nairobi from Kampala by road where the Kenyan handed over a bag to be delivered in Delhi while also providing tickets and certain documents to cover her visit as a Medical tourist. She was supposed to deliver the goods to a person who would contact her on exit. When she was intercepted by Customs officials, she was found to be in possession of a bag with a false bottom/cavity where 5.4 kg of Heroin was concealed.

The other female passenger was also intercepted in the same flight in almost similar manner wherein she was found to be in possession of two bags with false bottom/cavity containing cumulative of 7.5 kg of concealed heroin. During her preliminary questioning, the lady passenger revealed that she was sent by her sister from Kampala to Nairobi by road and from there to Delhi via Abu Dhabi by the aforementioned flight. This passenger was also possessing certain documents to fake the profile of a medical tourist.

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The success against the drug smuggling menace comes in the wake of earlier seizure of approx. 3 kg of heroin recovered from a Kenyan National who had arrived in the intervening night of 28th and 29th October 2021 from Nairobi via Sharjah. Before also, on 23.04.2021, two Indian nationals who were coming from Uganda were intercepted with 2 kg of heroin wherein investigation resulted into identification of 3 more accused persons who are based out of Uganda.

In this calendar year, the Delhi Customs have seized more than 100 kg of heroin. More than 26 persons have been arrested. Given the spurt in the attempts to smuggle in narcotics through the passenger route, Indian Customs have heightened the scrutiny and checking of suspects through robust intelligence gathering mechanism and pin pointed profiling at all the international airports. Customs department is at the forefront of crusade against the drugs smuggling and syndicates. In September this year, a huge consignment of 3000 kg of heroin were seized at Mundra port.

CBIC launches online digital application for scheduling of examination of cargo for traders at ICD Tughlakabad, Delhi (MoF Press Release dated 11th Nov 2021)

CBIC launches online digital application for scheduling of examination of cargo for traders at ICD Tughlakabad, Delhi

ICD Tuglakabad’s initiative will improve logistics efficiency of industry by launching Customs clearance work on Sundays and all public holidays

Customs at ICD Tuglakabad also inaugurates Baggage Scanner for non-intrusive examination of unaccompanied baggage/palletized import Cargo

As a major push in technology and digitalisation, Delhi Customs Zone took three important initiatives today.

An online facility for scheduling examination of Import cargo with the aim of minimising physical interface of trade with Customs and other stakeholders was launched. It is multi-stakeholder application where Customs, CONCOR, Customs brokers and importers on the same platform having a shared view of scheduling examination of goods.  This initiative will ensure fullest transparency alongside of convenience for trade and other stakeholders.

Customs at ICD Tuglakabad also inaugurated a Baggage Scanner, which will result in non-intrusive examination of unaccompanied baggage/palletized import Cargo while ensuring swifter clearances. This will also help Customs in targeted intervention to check smuggling. Few days earlier an electronic tracking of containerised cargo through use of Smart locks and an application built on Blockchain technology was launched. This enables customs to monitor and track movement of non-duty paid goods through GPS tracking while reducing compliance burden on trade in terms of documentation.

In another first, ICD Tuglakabad has taken the initiative of improving the logistics efficiency of industry by launching Customs clearance work on Sunday and all public holidays. This facility at ICD TKD is being implemented w.e.f. 14.11.2021 (Sunday) with work hours between 9:30 am to 6:00 pm. In this regard, Public Notice No. 34/2021 and Public Notice no. 04/2021 both dated 10.11.2021 has been issued by the Offices of Pr. Commissioner of Customs (Import) and Commissioner of Customs (Export), ICD-Tughlakabad (Import), New Delhi respectively.

ICD Tughlakabad (TKD) since 1993, at its present location, was the second Land port to be set up in the country after Bangalore in 1983. It caters to the need of importers and exporters and is the biggest inland dry port of North India. This port handles around 2,50,000 TEUs of Exim Cargo and is well connected with four full length rail lines to Gateway ports such as Mumbai, Nhava Sheva, Chennai, Mundra etc. besides bringing the containers by road from other ports such as Ludhiana, Haldia, Calcutta and Kandla, etc. ICD TKD is equipped with most modern facilities such as rail mounted gantry of 40 metric empty lifting capacity, rubber tire diesel powered cranes, billoties and lift trucks, etc.  along with two covered sheds, one for import and another for export with a total area of 16,000 sq. mts. in the Customs  bonded area for stuffing and de-stuffing of Exim goods. With these ultra-modern facilities, ICD-TKD, New Delhi, has developed into the largest multi-modal centre in the Indian sub-continent.

Special Secretary & Member (I.T. & Taxpayer services), Shri Sandeep Kumar, Shri Surjit Bhujbal, Chief Commissioner, Delhi Customs Zone along with other senior officers from ICD Tughlakabad, Parpargunj, Air Cargo Complex, Airport, Audit, Appeals and DG Systems graced the occasion.

Judiciary updates (Direct Tax, Indirect tax & Corporate Laws)-07 Nov 2021

HC directs dept to refund GST paid under wrong head by petitioner

SBI Cards & Payment Services Limited Vs Union of India (Punjab & Haryana High Court) dated 08/10/2021

Section 148 reassessment based on mere change of opinion is invalid

Jagannath Promoters & Builders Vs DCIT (Orissa High Court) dated 26/10/2021

Capital subsidy liable to be excluded from computation of book profit

Sunrise Biscuit Co. Pvt. Ltd. Vs ITO (ITAT Gauhati) dated 28/10/2021

No bail to person alleged of fraudulently inducing people to invest in Crypto Currency Chit Fund

Grant of bail was refused as applicant did not return the amounts due to the complainants and there was a breach of trust and faith and was against the national economy and national interest, whereby a large number of innocent investors had been duped of their hard-earned money.

Umesh Verma Vs State (Delhi High Court) dated 26/10/2021

Judgment cannot be given based on evidence recorded in other trial despite same offence

A.T. Mydeen and Another Vs Assistant Commissioner, Customs Department (Supreme Court of India) dated 29/10/2021

There Cannot Be Total Ban on Firecrackers : SC

Goutam Roy And Anr. Vs State of West Bengal & Ors. (Supreme Court of India) dated 01/11/2021


Bipul Kumar

Revamped Gold Monetisation Scheme, reduction in import duty of gold to help the industry to grow to the next level

Revamped Gold Monetisation Scheme, reduction in import duty of gold to help the industry to grow to the next level: Anupriya Patel

Reforms would help the industry to achieve export target of US$ 43.75 billion this year and gems and jewellery exports to USD 75 billion in coming years: Anupriya Patel

The Gems & Jewellery sector contributes around 7% to GDP and employs 5 million persons

The Gems & Jewellery sector is one of the important sectors of Indian Economy, with a contribution of around 7% to GDP, 10-12% share in country’s total merchandise export and being one of the leading sectors in terms of employment generation providing employment to approx. 5 million skilled and semi-skilled workforce.

The Minister of State for Commerce and Industry, Anupriya Patel said that she is pleased to learn that without any significant domestic production of raw materials, India has emerged as the leader in diamond manufacturing and export along with being one of largest exporter of other segments of industry such as gold jewellery, silver jewellery, coloured gemstones and synthetic stones. As such, gems and jewellery sector is an ideal example ‘Make in India’, the vision of Honourable Prime Minister.

She informed that the Gems and Jewellery sector has been one of the worst-hit sectors in India during the Covid-19 pandemic and its exports saw a record decline of (-) 98% in April 2020 due to the complete lockdown situation in the country.

However, the GJEPC, being apex body of gems and jewellery exporters, has undertaken prompt measures in terms of constantly interacting with the industry, understanding their requirements, and working closely with the government so as to chalk out the desired measures for supporting the industry in terms of sustaining, surviving and reviving back even amid a critical situation like Covid-19.

Consequent to such measures, the sector shown swift recovery as declining rate of gems and jewellery exports fell to (-) 6 % in Q3 as compared to (-) 72 % recorded in quarter 1  and in Q4 exports of the gems and jewellery witnessed a positive growth of around 15%. This trend has continued this year also and gems and jewellery exports achieved pre-Covid level of exports amounting US$ 9.2 billion in Q1 2021-22.

On the policy front, the Government has introduced a number of reforms, such as the revamped Gold Monetisation Scheme, reduction in import duty of gold, hallmarking, etc. which would help the industry to grow to the next level. Other issues flagged by GJEPC and industry from time to time are also being looked into and expected to be resolved soon.

She said that she’s sure this would not only help the industry to transform but will take the exports on a steep upward trajectory. This would help the industry to achieve export target of US$ 43.75 billion this year as well as to achieve goal of GJEPC to take gems and jewellery exports to USD 75 billion in coming years.

With support of the Government, GJEPC organized various virtual trade events last year like virtual Buyer Seller Meets, virtual IIJS, virtual International Gems & Jewellery Show (e-IGJS), India Global Connect, Webinars etc. These initiatives have helped the industry to bounce back quickly as the pandemic receded and global markets opened up.

She said that she has been informed that IIJS Premiere is the country’s largest B2B show in gems and jewellery sector and also the first show being organized by GJEPC in physical format after the onset of the COVID-19 pandemic. 

“I am confident that the show would provide platform to Indian jewellery manufacturers to showcase versatile jewellery crafted with the highest standards of design and finish and also to work with retailers, enabling them to gain insights into demand trends and product designs. On the other hand, the show would cater to the sourcing needs of the domestic and international buyers before the start of the festive season,” the MoS said.

She also wished the 37th edition of IIJS Premiere a tremendous success!

Ministry of Commerce & Industry Press Release dated 15th Sept 2021

De-notification of Inland Container Depots/Container Freight Stations/Air Freight Stations

Providing relief to custodians of Inland Container Depots (ICDs) and Container Freight Stations (CFSs) across the country, the CBIC today streamlined the procedure of closure of these facilities in maximum of four months only. No timeline was specified earlier.

ICDs and CFS play a vital role in the exim trade as they store and clear import and export goods. These facilities are notified under the Customs Act, 1962 and are administered by the Customs authorities. However, at times a custodian may like to close (de-notify) the facility. The disposal of un-cleared, seized and confiscated goods import/export are prerequisites for the de-notification. The CBIC noted that this process was taking a long time which caused difficulties for the custodians. 

The newly issued Circular No. 20/2021-Customs dated 16.08.2021 requires a custodian intending to wind up the operation to submit an application to jurisdictional Principal Commissioner/Commissioner of Customs for de-notifying the ICD/CFS. A Nodal Officer at the level of Deputy/Assistant Commissioner of Customs would then facilitate the de-notification by coordinating the disposal of the goods lying at the facility in a time bound manner.

The new procedure would ensure undue cost and time over runs are avoided. Importantly, the de-notification shall be completed within a maximum of four months from the date of receipt of complete application. This is yet another trade facilitation initiative by CBIC.

Ministry of Finance Press Release dated 17th Aug 2021


India and EU have agreed to resume the negotiations for a balanced, ambitious, comprehensive and mutually beneficial trade agreement

India and EU have agreed to resume the negotiations for a balanced, ambitious, comprehensive and mutually beneficial trade agreement. Free Trade Agreement (FTA) negotiations, including those on specific issues, are to be held considering the interest of either side. The commodities included / excluded in the FTA negotiations are to be finalized based on extensive consultations with the stakeholders, once negotiations resume.

Review of the existing FTAs is an ongoing process to maximize country’s export potential to benefit the domestic industry, and to make the FTAs more user friendly, simple and trade facilitative.

This information was given by the Minister of State in the Ministry of Commerce and Industry, Smt. Anupriya Patel, in a written reply in the Lok Sabha today.

Ministry of Commerce & Industry Press Release dated 04th Aug 2021

Various measures taken by Government for promotion of exports, Government is continuously engaged in strengthening Indian industry through “ease of doing business” for improving the business environment and attracting foreign investments

Government is committed for promoting Indian exports in international markets and suitable interventions are done from time to time. The key schemes/interventions taken are:

  1. The Foreign Trade Policy has been extended upto 30.09.2021 to provide a stable regime during the Covid-19 pandemic.
  2. Schemes such as the Advance Authorization Scheme and the Export Promotion Capital Goods (EPCG) Scheme are being implemented to enable duty free import of raw materials and capital goods for export production.
  3. The Interest Equalization Scheme, which provides pre and post shipment Rupee export credit has been extended upto 30.09.2021.
  4. Remission of Duties and Taxes on Exported Products (RoDTEP) scheme has been operationalized for exports with effect from 01.01.2021.
  5. It has been decided to extend the Rebate of State and Central Levies and Taxes (RoSCTL) Scheme for apparel and made-up exports till March 2024.
  6. Transport and Marketing Assistance (TMA) scheme for specified agriculture products provides assistance for the international component of freight and marketing of agricultural produce and to promote brand recognition for Indian agricultural products in the specified overseas markets.
  7. A common digital platform for Certificate of Origin (CoO) has been launched to increase Free Trade Agreement (FTA) utilization by exporters. 
  8. In order to leverage the full export potential of our vast country,  Districts are being promoted as Exports Hubs by identifying products and services with export potential in each district, addressing bottlenecks for exporting these products/services and supporting such local exporters/manufactures through institutional and strategic interventions. District specific export action plans for 478 districts have been prepared.
  9. Exports of services is being supported through negotiating meaningful market access through multilateral, regional and bilateral trade agreements, through participation in and organization of international fairs/exhibitions like the Global Exhibition on Services. An ‘Action Plan for Champion Sectors in Services’ is being developed  to give focused attention to identified Champion Services Sectors through  identified nodal Ministries/Departments
  10. Assistance is being extended to exporters under the Market Access Initiative (MAI) scheme for various activities such as export market research & product development, product registration, organizing / participating in fairs, exhibitions and Buyer Seller Meets (BSMs) abroad, Reverse Buyer Seller Meets etc.
  11. In order to have a coordinated and focused attention on development of export infrastructure, a working group on infrastructure up-gradation has been constituted under National Committee on Trade Facilitation (NCTF) and a National Trade Facilitation Action Plan (NTFAP) has been formulated. This includes measures for improving road and rail connectivity to ports and smart gates at sea ports.

Government is continuously engaged in strengthening Indian industry through “ease of doing business” for improving the business environment and attracting foreign investments.

To make domestic manufacturing globally competitive and to create global champions in manufacturing,Production Linked Incentive (PLI) Schemes in 13 sectors are being implemented. The Government has initiated a review of some of the existing Free Trade Agreements (FTAs) to maximize its export potential to benefit domestic industry as well as to make them more user friendly, simple and trade facilitative. In addition, bilateral trade negotiations have been initiated with a number ofcountries.

This information was given by the Minister of State in the Ministry of Commerce and Industry, Smt. Anupriya Patel, in a written reply in the Lok Sabha today.

Ministryof Commerce & Industry Press Release dated 04th Aug 2021