Latest news with #CentralGoodsandServicesTaxAct
Mint
4 hours ago
- Business
- Mint
Schloss Bangalores arm Tulsi Palace Resort gets ₹4.66 cr tax demand notices
New Delhi, Jun 10 (PTI) Brookfield-backed Schloss Bangalore, which operates Leela Palaces Hotels and Resorts, on Tuesday said its subsidiary has received show cause notices from the Central GST department, Jaipur raising a tax demand of ₹ 4.66 crore for alleged violations of various taxation norms. The show cause notices issued to Tulsi Palace Resort Private Limited (TPRPL), a material subsidiary of the company, is for alleged violations pertaining to wrongful adjustment of tax liability and non-payment of IGST on import of services under reverse charge mechanism. In a regulatory filing, Schloss Bangalore said it "will file an appropriate response before the adjudicating authority" on the show cause notices issued to TPRPL. "TPRPL, a material subsidiary of the company, has received show cause notices under sections 73 and 74 of the Central Goods and Services Tax Act, 2017, read with the corresponding provisions of the State Goods and Services Tax Act, 2017 and the Integrated Goods and Services Tax Act, 2017, raising an aggregate demand amounting to ₹ 4.66 crore (excluding interest and penalty) for certain alleged violations," it said. The tax demand has been raised by the Office of the Commissioner, Central Goods and Service Tax Audit Commissionerate, Jaipur. " received the show cause notices for alleged (i) wrongful adjustment of tax liability in table 5O of Form GSTR-9C during the financial years 2021-22 and 2022-23; and (ii) non-payment of IGST on import of services under reverse charge mechanism during the financial years 2018-19 to 2022-23," Schloss Bangalore stated.
Mint
6 hours ago
- Business
- Mint
Schloss Bangalores arm Tulsi Palace Resort gets ₹4.66 cr tax demand notices
PTI Published 10 Jun 2025, 02:07 PM IST New Delhi, Jun 10 (PTI) Brookfield-backed Schloss Bangalore, which operates Leela Palaces Hotels and Resorts, on Tuesday said its subsidiary has received show cause notices from the Central GST department, Jaipur raising a tax demand of ₹ 4.66 crore for alleged violations of various taxation norms. The show cause notices issued to Tulsi Palace Resort Private Limited (TPRPL), a material subsidiary of the company, is for alleged violations pertaining to wrongful adjustment of tax liability and non-payment of IGST on import of services under reverse charge mechanism. In a regulatory filing, Schloss Bangalore said it "will file an appropriate response before the adjudicating authority" on the show cause notices issued to TPRPL. "TPRPL, a material subsidiary of the company, has received show cause notices under sections 73 and 74 of the Central Goods and Services Tax Act, 2017, read with the corresponding provisions of the State Goods and Services Tax Act, 2017 and the Integrated Goods and Services Tax Act, 2017, raising an aggregate demand amounting to ₹ 4.66 crore (excluding interest and penalty) for certain alleged violations," it said. The tax demand has been raised by the Office of the Commissioner, Central Goods and Service Tax Audit Commissionerate, Jaipur. " received the show cause notices for alleged (i) wrongful adjustment of tax liability in table 5O of Form GSTR-9C during the financial years 2021-22 and 2022-23; and (ii) non-payment of IGST on import of services under reverse charge mechanism during the financial years 2018-19 to 2022-23," Schloss Bangalore stated. "TPRPL will file an appropriate response before the adjudicating authority. The show cause notices have no material impact on the financial, operation and other activities of the company," it added.
Time of India
22-05-2025
- Business
- Time of India
SC rejects finance ministry's plea against input tax credits for commercial rentals
The Supreme Court has rejected the finance ministry's petition seeking a review of its October judgement, which allowed real estate companies to claim input tax credits (ITC) on the construction cost for commercial buildings meant for renting purposes. A Bench led by Justice AS Oka while dismissing the ministry's plea on Tuesday said that it has gone through the review petition and the October 3 judgment, which has been sought to be reviewed, and 'there is no error apparent on the record.' The government wanted the apex court to align with the original legislative intent, after the 55th Goods and Services Tax Council had in December suggested a retrospective amendment to the GST law to correct what it described as a 'drafting error' in the legal provisions related to ITC. The ITC mechanism allows businesses to claim credit for the tax they paid on inputs and set it off against their GST liability. This proposed amendment aims to reverse the SC ruling by changing the terminology from 'plant or machinery' to 'plant and machinery' in Section 17(5)(d) of the Central Goods and Services Tax Act (CGST) Act, 2017. Saurabh Agarwal, Tax Partner, EY told ET that while the SC judgment on ITC aligns with the industry's logical expectation – that credit should flow seamlessly when output is taxed – the recent retrospective amendment in the last budget unfortunately negates this clarity. 'This development, therefore, doesn't bring the anticipated tax certainty. Instead, it's highly probable that after this development industry will now challenge the retrospective amendment made in terms of last budget, prolonging the uncertainty we all hoped to avoid.' Earlier the Central Board of Indirect Taxes and Customs chairman Sanjay Kumar Agarwal had also said that there had been a drafting mistake in the law as 'the term 'plant and machinery' appears at 11 places in the GST Act but in one place, it was incorrectly written as 'plant or machinery.' This error is now being corrected with retrospective effect from July 1, 2017.' In a big relief to the real estate sector, the court had on October 3 last year held that if construction of a building is essential for supplying services like leasing/renting out, it could fall under the 'plant' category on which ITC can be claimed under Section 17(5)(d). This provision essentially prohibited claiming ITC for construction materials (other than plant or machinery) used for immovable property construction. The apex court ruled that 'if the construction of a building is essential for the activity of supplying services like renting or leasing, as outlined in clauses 2 and 5 of Schedule 2 of the CGST Act, the building may be considered a 'plant'." The apex court said that if buildings provided on rent perform the same function as that of a "plant" in a factory which produces economic value and output supply, then ITC on such buildings cannot be denied. In this case, the Odisha High Court in 2019 had allowed real estate firm Safari Retreats to claim the benefit of ITC on works contract and other goods and services used in the construction of an immovable property, excluding plant and machinery. The HC had ruled that ITC for construction materials under the provision cannot be denied to developers constructing properties for renting out. The revenue department then challenged the HC decision in the SC.
Time of India
21-05-2025
- Business
- Time of India
SC rejects finance ministry's plea against input tax credits for commercial rentals
Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads The Supreme Court has rejected the finance ministry's petition seeking a review of its October judgement, which allowed real estate companies to claim input tax credits (ITC) on the construction cost for commercial buildings meant for renting purposes.A Bench led by Justice AS Oka while dismissing the ministry's plea on Tuesday said that it has gone through the review petition and the October 3 judgment, which has been sought to be reviewed, and 'there is no error apparent on the record.'The government wanted the apex court to align with the original legislative intent, after the 55th Goods and Services Tax Council had in December suggested a retrospective amendment to the GST law to correct what it described as a 'drafting error' in the legal provisions related to ITC mechanism allows businesses to claim credit for the tax they paid on inputs and set it off against their GST proposed amendment aims to reverse the SC ruling by changing the terminology from 'plant or machinery' to 'plant and machinery' in Section 17(5)(d) of the Central Goods and Services Tax Act (CGST) Act, Agarwal, Tax Partner, EY told ET that while the SC judgment on ITC aligns with the industry's logical expectation – that credit should flow seamlessly when output is taxed – the recent retrospective amendment in the last budget unfortunately negates this clarity. 'This development, therefore, doesn't bring the anticipated tax certainty . Instead, it's highly probable that after this development industry will now challenge the retrospective amendment made in terms of last budget, prolonging the uncertainty we all hoped to avoid.'Earlier the Central Board of Indirect Taxes and Customs chairman Sanjay Kumar Agarwal had also said that there had been a drafting mistake in the law as 'the term ' plant and machinery ' appears at 11 places in the GST Act but in one place, it was incorrectly written as 'plant or machinery.' This error is now being corrected with retrospective effect from July 1, 2017.'In a big relief to the real estate sector, the court had on October 3 last year held that if construction of a building is essential for supplying services like leasing/renting out, it could fall under the 'plant' category on which ITC can be claimed under Section 17(5)(d).This provision essentially prohibited claiming ITC for construction materials (other than plant or machinery) used for immovable property apex court ruled that 'if the construction of a building is essential for the activity of supplying services like renting or leasing, as outlined in clauses 2 and 5 of Schedule 2 of the CGST Act, the building may be considered a 'plant'."The apex court said that if buildings provided on rent perform the same function as that of a "plant" in a factory which produces economic value and output supply, then ITC on such buildings cannot be this case, the Odisha High Court in 2019 had allowed real estate firm Safari Retreats to claim the benefit of ITC on works contract and other goods and services used in the construction of an immovable property, excluding plant and machinery. The HC had ruled that ITC for construction materials under the provision cannot be denied to developers constructing properties for renting out. The revenue department then challenged the HC decision in the SC.
Time of India
14-05-2025
- Business
- Time of India
High court fines firm for fraudulent GST tax credit claim
Delhi high court (File photo) NEW DELHI: Flagging concerns over the misuse of a Central Goods and Services Tax Act provision, Delhi high court has fined a private firm for fraudulently claiming input tax credit (ITC) to escape paying full GST. 'This court takes note, with some consternation, that such large-scale fraudulent availment of ITC may, if left unchecked, lead to severe damage to the GST framework itself,' HC said. Fake invoices leading to GST credit facility misuse: HC The GST framework is meant to encourage legally entitled persons and businesses to avail of ITC and other similar facilities, said a bench of Justices Prathiba M Singh and Rajneesh Kumar Gupta in a recent order. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Seniors Can Hear Whispers Again With These Amazing Hearing Aids Prime Sound Learn More Undo HC noted Section 16 of CGST Act was being misused by companies and traders who first availed of the ITC by issuing fake invoices and, when slapped with a penalty by the department, rushed to court in writ jurisdiction. In essence, ITC allows a tax entity or person to claim credit & deduct from payable GST on purchase of goods and/or services used in the chain of business transaction, as it has been taxed earlier. However, court noted that due to fake invoices leading to fraudulent claims by persons, the facility is being misused, along with writ jurisdiction of the court. 'This court... is exercising jurisdiction under Article 226 of the Constitution and when there is an allegation of such large-scale fraud, to the tune of more than Rs 56.2 crore, being committed with the involvement of a total of 527 firms including the petitioner firm, the court has to be circumspect in the exercise of its powers,' HC noted while imposing costs on the private entity after it emerged fake invoices were created to escape GST liability.
