SERVICE TAX SECTION

National Co-Operative Development Corporation Vs CST

ST - Assessee is promoting programmes of cooperative development in country and as per Policy of Government, one of their main activity is promoting sugar development fund (SDF) loans at the concessional rate for modernization and rehabilitation of sugar mills - In pursuance of said activity, they disbursed the said loan to identified industry and obtained commission for such financial activity - Revenue views that such commission earned while disbursing loan will be attracting service tax under the category of BAS in terms of Section 65(19) of FA, 1994 - Claim of party that this is a statutory act and cannot be covered by tax liability is not accepted - Commission received and accounted at the end of assessee as commission income and this is not a fee, charge or levy of Government - Assessee is independent corporation for commercial activity - They may be mandated to act in a particular manner by Policy of government - That by itself will not exempt them from tax liability - There is no case for excluding income of assessee as commission in disbursing loan, from tax liability under BAS - No infirmity found in order of original authority on merit - Regarding limitation, assessee have been intimating the department about their activity even 5 years before issue of SCN - It clearly shows the bonafide of the appellant and as Govt. corporation, there is a rebuttable presumption that they have no intention to evade the tax - Demand proceeding initiated against assessee are barred by limitation for period beyond normal period: CESTAT - Appeals partly allowed: DELHI CESTAT

2018-TIOL-980-CESTAT-ALL

ST - Service tax demands have been made against 'Police Department' on the basis of view entertained by revenue that police department has provided 'Security Agency Service' Covered under Section 65 (105) (w) read with Section 65 (94) of FA, 1994 - It is found that assessee have rendered statutory function, as providing security is a sovereign function - Service provided by assessee is not taxable as clarified by Circular 96/7/2007-ST - Accordingly, appeal is allowed and impugned order is set aside: CESTAT

CENTRAL EXCISE SECTION

2018-TIOL-983-CESTAT-HYD

CX - Assessee engaged in manufacture of product viz. 'Aswini Homeo Arnica Hair Oil' (AHAHO) and classified the said product as Medicament falling under CSH 30039014 and were claiming concessional rate of duty under Notfn 18/2012- CE - They were issued SCNs from time to time alleging that goods are preparation for use on the hair and are classifiable under CSH 33059019 and are liable to duty accordingly as Cosmetic - Nowhere in the SCN or the impugned order, it is demonstrated that the product in question was projected as cosmetic or toiletary product by assessee or known in the market as such - Assessee has submitted certificates issued by Practitioners in the field that product in question is used as medicine - Only for the reason that it is sold by medical shop as well as general stores or that it is not sold under prescription of doctors would not take it out from the category and classification as medicine - Assessee was earlier issued demand notice on four different occasions and on each occasion the issue stands decided in favour of assessee by the Appellate Authorities holding the goods to be Homeopathic medicine and liable to duty accordingly - In case of Vicco Laboratories 2004-TIOL-109-SC-CX-LB , the Apex Court has held that classification cannot be changed without a change in nature of a product or a fresh interpretation of tariff heading by such decision - In present case, goods in question has remained same and there is no change of tariff heading - Thus, contention of Adjudicating authority that the change in tariff entry would require relook into classification is absolutely erroneous as the product has remained same and it would remain classified as Homeopathic medicine - Thus, goods are classifiable under chapter 30 of CETA as Homeopathic medicine and liable to duty accordingly - There is no reason to demand the duties and penalties adjudged against assessee: CESTAT - Appeals allowed: HYDERABAD CESTAT

2018-TIOL-982-CESTAT-ALL

CX - Assessee is a manufacturer having one of its factory situated at Kanpur carrying on business of manufacture of Catalyst & Refractory Insulator - It appeared to Revenue that assessee was suppressing the production of excisable goods and removing the same clandestinely from factory premises - Nature of business of assessee is very different, inasmuch as they are manufacturing Catalysts for which there are only about five buyers available in the country - In manufacture of Catalysts, some other Catalysts are also necessarily manufactured by way of a joint product or byproduct - It is also a unique situation, wherein assessee cannot keep in store for long the Catalysts manufactured either main product and also as joint product or byproduct - Due to very few buyers available in market, there exists a situation of cartel of buyers who are able to negotiate special terms for purchase - Under such purchase terms which are duly put into writing the assessee have made the supplies partly chargeable and partly free which are in the nature of quantity discount and call for no adverse inference - So far as the allegation in SCN is concerned regarding receipt of part of sale consideration in form of service charges, such allegation is bald and presumptive - There is no further enquiry from receiver of service named in the invoices - It is also an admitted fact that the assessee have paid duty on the total transaction value which includes free supplies during the period in question - Further, there is no evidence of any additional consideration received or any flow back in any manner by assessee - Business of assessee is running since 1990 or earlier and they have been under similar nature of transactions and business all throughout and thus such transactions have been accepted by Revenue also in past and also in the future - In this view of the matter, impugned order set aside: CESTAT - Appeal allowed: ALLAHABAD CESTAT

East Coast Bearings Vs Commercial Tax Officer

Whether concessional rate of tax can be denied to registered dealers, if the Prescribed Authority is satisfied that the dealer is prevented by reasonable & sufficient cause which disenabled him to file Form C Declarations in time - NO: HC - Assessee's petition allowed: MADRAS HIGH COURT

2018-TIOL-527-HC-MAD-CT

Whether Revenue can re-assess the assessment of any dealer by conducting a surprise inspection at his premises, based on an information furnished by third party non-registered dealer - NO: HC - Assessee's petition allowed: MADRAS HIGH COURT