SERVICE TAX SECTION
2018-TIOL-844-CESTAT-ALL
Kanpur Cargo Movers Vs CCE & ST
ST - Whether demand of service tax have been rightly made on brokerage earned for providing taxable services under head BAS - The other issue is whether penalties have been rightly imposed under Section 78(1) 70(1), 71(1(d) and 77(2) of Finance Act, 1994 and further issue is whether SCN have been rightly issued as regards the demand which amount had been admittedly deposited by assessee along with interest prior to the issue of SCN - Issue is no longer res Integra and the same is decided in favour of assessee by Coordinate Bench of Tribunal in M/s Greenwich Meridian Logistics India Pvt. Ltd. 2016-TIOL-869-CESTAT-MUM wherein it was observed that each source of income must be looked at independently - Service provider is not necessarily specialist in rendering one service - Earnings of service entity may accrue from one or more services, some of which may be taxable - Under similar facts and circumstances, wherein the course of audit, it was seen that the assessee had ocean freight surplus and it was explained that these profits are arising from purchase and sale of space or slots for ocean transport of container and the same was proposed to be taxed under BAS, this Tribunal held, the notional surplus earned thereby arises from purchase and sale of space and not by acting for a client who has space or slot on a vessel - Accordingly, demand on account of brokerage is set aside - So far the other demand of Rs.1,14,15,678/-, this amount was admittedly paid & declared in ST-3 Returns, prior to issue of SCN - Accordingly, SCN as regard this amount is bad and not sustainable - Further, assessee have taken adequate measures for meeting the service tax liability, being the facts on record that there was defalcation of amounts by its staff, drawn towards payment of service tax is not disputed and further assessee have on discovering the defalcation by its employee, deposited the tax forthwith with interest - Under these facts and circumstances, penalty under Section 78(1) is not tenable - The other penalties, however, are not interfered with: CESTAT - Appeal partly allowed: ALLAHABAD CESTAT
2018-TIOL-843-CESTAT-MAD
Assisi Travels Vs CCE
ST - the assessee-company engaged in providing air travel agent service - The Revenue alleged short-payment of service tax and raised duty demand, with interest & penalty u/s 76 and 78 - Later, the Commr.(A) set aside the penalty but upheld duty demand with interest -
Held - since the firm obtained new service tax registration, the demand prior to 27.8.2000 is unsustainable and merits being set aside - Further, the Revenue included the amount repaid to the customers - Such issue has not been considered by the authorities below & requires verification - Hence, matter remanded to verify and recompute tax demand - Also, assessee's plea w.r.t. the refunded amount having been included in the total value of taxable services also be verified: CESTAT (Para 2,5,6,7) - Case Remanded: CHENNAI CESTAT
CENTRAL EXCISE SECTION
2018-TIOL-460-HC-MUM-CX
Tex-Age Vs UoI
CX - the assessee-company was engaged in producing & exporting ready-made garments - The Revenue alleged that the assessee over-valued the goods - Later in the Tribunal, the Member(J) held that statements recorded by officers had been retracted & invoices recovered from the Indo-Arab Chamber of Commerce, were not statutory records - Hence they cannot prevail over uncontroverted reports of physical examination of goods under export and remittances for the exports were realised - The Tribunal held that a prima facie case for waiver was made out, since the issue at hand was debatable.
Held - The Revenue appeal against such Tribunal order was dismissed by the Apex Court - Hence the Revenue directed to implement the Tribunal order, within two months: HC (Para 1-4) - Application Allowed: BOMBAY HIGH COURT
2018-TIOL-847-CESTAT-CHD
Unimet Profiles Pvt Ltd Vs CCE
CX - the assessee-company manufactures cold rolled profiles, sheets, angles, shapes and sections - The assessee also galvanized said products on their own products & also on job work basis for other manufacturers - The Revenue claimed that the activity of galvanization constituted manufacture and so attracted excise duty - The assessee undertook job work for two types of customers - In the first case, the principal itself was a manufacturer, following the procedure under Rule 4(5)(a) of CCR, 2004 - In such case, the assessee is not obliged to pay duty - In the other case, the assessee cleared goods to customers based in Himachal Pradesh, after paying duty on job charges - The Revenue opined that duty had to be paid by the assessee on job charges & include the value of raw materials & inputs supplied by the principal manufacturer or their customers - Duty demands were raised -
Held - If the assessee followed the due procedure for undertaking job work for other manufacturer, who used the intermediate goods to manufacture their final products, the assessee is entitled to benefit of job work scheme under Rule 4(5)(a) of CCR, even though it inadvertently paid duty - Thus, the differential duty confirmed based on higher assessable value is unsustainable - Such facts be verified by the lower authorities: CESTAT (Para 2,5) - Case Remanded: CHANDIGARH CESTAT
2018-TIOL-846-CESTAT-AHM
Vishal Ranka Vs CCE & C
CX - Assessee had availed credit on returned/rejected finished goods under Rule 16(1) of CER, 2002 - SCN was issued for recovery of said credit alleging non-compliance with conditions of said Rule 16 - From the evidences viz. Panchanama enclosed with Appeal Paper book, it is clear that the relevant documents/invoices for relevant period were seized by authorities and there is no evidence that it were returned to assessee - Thus, it is clear that these documents are still with the Department - In interest of justice, matter remanded to Commissioner (A), to decide the said issue of eligibility of credit availed on returned/rejected goods afresh after taking into consideration the relevant invoices/evidences: CESTAT -Matter remanded: MUMBAI CESTAT
2018-TIOL-845-CESTAT-AHM
Farmson Pharmaceutical Gujarat Pvt Ltd Vs CCE & ST
CX - the assessee-company manufactured excisable goods & availed Cenvat credit on input services of fabrication, erection and commissioning of various pipelines - These input services were availed to set up factory premises - The Revenue denied such credit on grounds that post April 1, 2011, the definition of input service was amended to exclude input services used to set up factory premises -
Held - The assessee claimed to have initiated setting up of factory prior to April 1, 2011 - Such argument lends no aid since the input services were provided in 2015 & on which service tax was paid - Hence the credit was correctly denied: CESTAT (Para 3,6,7) - Appeal Dismissed: AHMEDABAD CESTAT
CUSTOMS SECTION
NOTIFICATION
ctariffadd18_008
Anti-dumping duty imposed on imports of 'Ofloxacin' from China PR
CASE LAWS
2018-TIOL-459-HC-MUM-CUS + Story
Santosh Krishna Talpade Vs State Of Maharashtra
Cus - Criminal prosecution against the customs officer cannot be continued once the basis for such prosecution, being departmental proceedings, have already come to an end in favour of the petitioner - prosecution initiated against the petitioner in Criminal Complaint pending on the file of Chief Metropolitan Magistrate, Esplanade, Mumbai quashed with consequential reliefs: High Court [para 8 to 12] - Petition allowed: BOMBAY HIGH COURT
2018-TIOL-842-CESTAT-MAD
Bramhani Industries Ltd Vs CC
Cus - Core issues that come up for decision is; whether the import of goods is a pre-condition / intrinsic part of total importation of main plant and machinery and whether "Engineering Design and Technical Documentation" imported can be classified under Chapter 49 of CTH as claimed by assessee or whether they are required to be classified along with the main plant and machinery and equipments imported for the project - On the issue of enhancement of declared values, from the copy of agreement, it emerges that the agreement involves purchase of complete design, equipments, systems, technical services and training for Coke Oven plant and by-product plant project - Purchase of design is also part of bucket list of purchase - Import of Engineering Design and Technical Documentation are not for any post-import activity but are indispensible condition to import of main plant and equipment/machinery - Sufficient evidence has been unearthed by department to establish that declared / invoice values were much lower than the actual price adopted by assessee to the foreign supplier - Assessee have not adduced any counter evidence or proof to counter the allegations made in SCNs and confirmed by adjudicating authority - Adjudicating authority had delved deep into the actual pricing of impugned goods, the manner of payments and other evidences and only thereafter has confirmed the enhancement of the declared values - Tribunal is not able to find any infirmity in such enhancement of declared values and assessee's prayer on this count will also fail.
Coming to classification of impugned goods, once it has been established that the value of Engineering, Design and Technical documents are required to be added to assessable value of related plant and machinery/equipment earlier imported, then each of such import will merit classification under Customs Tariff as that of the main import and therefore no infirmity found in change of classification ordered by adjudicating authority - When imported goods have been evidently found as not corresponding in respect of value, hence their confiscation under Section 111 (m) is ordinarily very permissible - There is also no bar for imposition of redemption fine under Section 125 if there is no duty liability has been determined - No interference required with imposition of penalties on assessee or quantum thereof: CESTAT - CHENNAI CESTAT - Case Remanded: CHENNAI CESTAT
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