SERVICE TAX SECTION

2018-TIOL-1012-CESTAT-MAD

ST - Assessee is providing services under category of Banking and other Financial Services - Revenue views that assessee is liable to pay service tax on profits earned on Foreign Exchange remuneration - Assessee accepted the objection of audit and paid service tax - Thereafter, assessee filed a refund claim relating to period April 2005 to March 2006, before the service tax authorities on 23.01.2007, on the ground that said payment of service tax was on a wrong view that Foreign Exchange remuneration services are taxable - Dispute relates to legal issue as to whether profit earned by assessee on Foreign Exchange remuneration is a taxable service - The taxability of same stands considered by adjudicating authority in adjudication, relatable to refund claim filed by assessee and the same stands upheld by adjudicating authority and having not been appealed against holds the field - In as much as taxability has already been held against assessee and refund claim filed on the said ground of non-taxability stands rejected, action of assessee taking suo motto credit of tax paid cannot be appreciated and hold in accordance with law - It may not be out of place once again to mention that the provision of Rule 6 (3) of STR, 1994, do not relate to dispute on taxability and simplicitor allow the credit of service tax already paid in respect of the services which are subsequently not provided by an assessee - The impugned orders are upheld: CESTAT - Appeal rejected : CHENNAI CESTAT

2018-TIOL-1011-CESTAT-MUM

ST - Appellant is engaged in providing services of commission agent to Royal Twinkle Group which was raising money from market through member investors - Enquiries conducted by the department revealed that the appellant was rendering services of commission agent to Royal Twinkle Star Club Ltd., Royal Twinkle Star Club Pvt. Ltd. and Royal Twinkle Envirotech Ltd. - From April 2007 to March 2012, the appellant received commission of Rs.1,47,82,720/-, however, appellant did not register themselves with department and pay service tax – SCN issued on 05.10.2012 demanding Service Tax of Rs.14,48,095/- under BAS along with interest and penalty – AA confirming demand and imposing penalties, interest – appellant had paid service tax along with interest before issuance of SCN and pleaded before Commissioner(A) for waiver of penalties as they were not much educated; not conversant with service tax provisions and also had not collected any tax & interest from customers – appeal to CESTAT as appeal rejected by Commissioner(A).

Held: Appellant has paid entire service tax along with interest; they have not collected service tax from their clients - Revenue has not brought any evidence on record showing that the appellants have suppressed material facts from department with intention to evade payment of tax – appellants are women from a small village and not much educated, therefore, were ignorant about the provisions of service tax – Bench of the considered view that appell ants are entitled to benefit of section 80 of the FA, 1994 – penalties dropped: CESTAT [para 7, 8] - Appeals allowed : MUMBAI CESTAT

CENTRAL EXCISE SECTION

2018-TIOL-1015-CESTAT-MUM

CX - Appellant supplying forgings and bars to Bosch Ltd. – On receipt of goods, Bosch Ltd. deputed an independent agency for sorting of goods to detect defects and conduct quality checks – such charges were recovered by Bosch from appellant by issuance of debit note and appellant claimed CENVAT credit of the service tax paid on such sorting services – original authority allowed credit but in Revenue appeal, Commissioner(A) denied the credit and allowed Revenue appeal, therefore, appellant before CESTAT.

Held: Since the said service was provided on behalf of the appellant, Bosch has issued debit note – even though the service of sorting was done at premises of Bosch, it is for and on behalf of the appellant – therefore, it is in or in relation to manufacture of final products as this activity is part of the manufacturing and supply of acceptable quality product – location of service is not important – since the important aspect is that the service is provided in or in relatio n to the manufacture of final product, irrespective of location, no reason to deny credit – impugned order set aside and appeal allowed: CESTAT [para 4] - Appeal allowed : MUMBAI CESTAT

2018-TIOL-1014-CESTAT-MUM

CX – CENVAT – Rule 6 of CCR, 2004 - Common input services for trading and manufacture – Trading notified as exempt service from 01.04.2011 - SCN has demanded payment of 6% of value of goods cleared for trading since no separate accounts for input service used in trading and manufacturing – demand confirmed of Rs.4,01,224/- - appeal to CESTAT.

Held: It is surprising that SCN imposed liability based on value of goods which were involved in the service – no attempt has been made in the SCN to isolate the value of the service on which alone liability u/r 6(3)(i) of CCR, 2004 could be applied – CENVAT credit attributable to exempt activity is Rs.5551/- and which is not in dispute – It is certainly not the intention of law to recover an amount of Rs.4,01,224/- when the benefit derived is limited to Rs.5551/- and which was already reversed by appellant – it is settled law that reversal of CENVAT credit is no different from non-availment of credit – confirmation of recovery of amount and imposition of penalty is not sustainable in law, hence set aside – Appeal allowed: CESTAT [para 5, 6] - Appeal allowed : MUMBAI CESTAT

2018-TIOL-1013-CESTAT-MUM

CX - Refund claim filed as a consequence of finalization of provisional assessment - Revenue in appeal against Order-in-Appeal setting aside the order of the original authority sanctioning the refund claim but transferring the same to the Consumer Welfare Fund.

Held: Excess duty paid upon clearance of asbestos cement sheets and accessories and the excess duty initially charged from the buyers was subsequently adjusted by issue of credit notes – since issuance of credit notes records actual duty that was collected from the customer, the bar of unjust enrichment will not arise – Revenue appeal dismissed: CESTAT [para 5, 6] - Appeal dismissed : MUMBAI CESTAT

2018-TIOL-543-HC-ORISSA-CT

Sagarmal Agarwalla Vs CST

Whether suo motu revisional proceedings initiated u/s 23(4)(a) of OST Act r/w Rule 80 are to be concluded within a period of 3 yrs from the date of the final orders passed - YES : HC - Assessee's Writ petition allowed : ORISSA HIGH COURT

2018-TIOL-542-HC-MAD-VAT

Whether findings of fact recorded by a forum can be declared as perverse only, if such findings are arrived at by neglecting relevant material or by considering extraneous evidences - YES: HC - Order passed in favour of Revenue : MADRAS HIGH COURT