13 October 2017   

CST Vs M/s PRACHAR COMMUNICATION LTD : BOMBAY HIGH COURT (Dated: September 25, 2017)

ST – Refund – Unjust enrichment - Appellate Tribunal has oversimplified the matter by observing that there was no dispute that the realization for service was less than bill amount entitling the respondent to pay duty on the net amount received after discount - There is no finding recorded by the Tribunal that M/s.Emami Limited, the client of the appellant, did not pass on incidence of service tax on the 15% amount to its customers or buyers of the products - Burden was on the respondent to establish that M/s.Emami has not passed on the incidence of service tax to any other person including its customers or purchasers of the products - Respondent has not established that the incidence of service tax has not been passed by M/s.Emami Limited to any other person – Tribunal order set aside and Revenue appeal allowed – Order of Commissioner that refund claims were erroneously allowed restored: High Court [para 11, 12]

Appeal allowed

2017-TIOL-2153-HC-MUM-CX

CCE Vs MONOMER CHEMICAL INDUSTRIES PVT LTD : BOMBAY HIGH COURT (Dated: September 06, 2017)

CX - the assessee company obtained right over a plot in an industrial estate, from another firm which was registered under the CEA - When the assessee sought registration of the plot in its name, the revenue proposed to deny registration u/s 6 of the Act r/w Rule 9 of the CER, 2002, on grounds that some adjudication proceedings were pending against the erstwhile owner - Subsequently, the Tribunal allowed the assessee's appeal and directed granting of registration of the plot in the assessee's name.

Held - Although the initial SCN denying registration stated that there was some adjudication pending against the assessee, the Asst. Commr. held that there was no enforceable duty demand against the erstwhile firm, and that it had surrendered its registration and also undertook to clear all Govt. dues pending - Moreover, the plot was transferred to the assessee before the SCN was issued to the erstwhile firm demanding duty - Considering a decision of this Court in Tata Metaliks Limited Vs. Union of India and that of the Andhra Pradesh High Court in Modi RJR Ltd. Vs. Commissioner of Central Excise, as well as Rule 9 of the CER and relevant Circular issued by the CBEC, the issue of the erstwhile firm's liability to pay duty was irrelevant - Even if the registration was granted to the assessee in respect of the premises for which the erstwhile firm was granted registration, the State could always continue with the demand/recovery proceedings and recover the dues in accordance with law - If the liability to pay the dues was attached to the plot transferred in the name of the assessee, the said liability could be always enforced, and which had nothing to do with the merits of the application for registration made by the assessee - Hence the Tribunal order warrants no interference: High Court (Para 2,46,7,9)

Appeal dismissed

WINDALS AUTO PVT LTD Vs CCE : BOMBAY HIGH COURT (Dated: September 20, 2017)

CX - based on some intelligence inputs, the officials of the Director General of Anti-Evasion, Zonal Unit visited & investigated the assessee company's premises - Based on statements taken from an employee and the director of the assessee company, duty demand with interest & penalty was imposed - A seperate SCN was issued to one director of the assessee company, although penalty was not imposed on him under Rule 209A of the CER - Pursuant to remand by the Tribunal, in fresh adjudication, increased amount of penalty was imposed, and the assessee was held liable to pay interest as well - The assessee again approached the Tribunal who dismissed the appeal.

Held - the Tribunal was required to record reasons by applying its mind to the grounds of challenge in the Memorandum of Appeal - However, it did not advert to the same & there were no elaborate findings recorded in its judgment - It did not also record reasons for dismissing the appeal - Hence, impugned orders set aside and appeals restored to Tribunal for fresh adjudication: High Court (Para 3,6,7,8)

Case remanded

2017-TIOL-3699-CESTAT-DEL

FEDERATION OF INDIAN EXPORT ORGANISATION (FIEO) Vs CST : DELHI CESTAT (Dated: September 22, 2017)

ST - the assessee organisation is the apex body for promotion and development of exports in the country - The Foreign Trade Policy (FTP) mandates every exporter to become a member of the assessee organisation, or any export promotion council, so as to avail the various incentives of the FTP - The assessee collected membership fees from its members - There were other considerations like subscription, national or international meeting fee, seller meetings' fee which were included in their income - The revenue sought to pay service tax under heading "Club or Association Service" - Duty demand with penalties u/s 76, 77 & 78 of the Finance Act, 1994, was imposed - Held - Considering the judgments in the cases of M/s. Federation of Indian Chambers of Commerce and Industry & Ors. and Sports Club of Gujarat Ltd. Vs. Union of India and Ranchi Club Ltd. Vs. Chief Commissioner of Central Excise & Service Tax, which involve similar facts and issues of law, the impugned order is unsustainable: CESTAT (Para 2,6,7,8)

Appeal allowed