SERVICE TAX SECTION

2018-TIOL-1104-CESTAT-DEL

Prime Rockwool Vs CST

ST - Assessee is providing taxable service under category of Erection, Commissioning & Installation services - They had undertaken job work of insulation of pipes and plant and machinery in the factory of Service receiver - For providing such taxable service, assessee claimed abatement under Notfn 1/2006-ST which was denied by the Department on the ground that the conditions of notfn have not been fulfilled - Said Notfn provides exemption to commissioning and installation agency by way of providing abatement from payment of Service Tax on 67% of total value - In order to get the benefit of abatement, both the conditions should be fulfilled by service provider i.e. supply of plant, machinery etc. and erection commissioning or installation of those plant/ machinery - Since the assessee had not supplied plant and machinery equipment and only undertook the job of erection commissioning and installation of capital items installed in factory of service receiver, the condition of said notification, in totality has not been fulfilled, in order to get the benefit of abatement - Thus, denial of benefit of abatement under said Notfn by authorities below are proper and justified - Assessee did not disclose its activities of undertaking the insulation work for the service receiver and the said facts came to the notice of Department through audit - Thus, SCN is not barred by limitation of time - Considering the fact that the issue involves interpretation of Notfn, benefit of Section 80 of the Act should be extended for non-imposition of penalties under Section 76,77 and 78 of the Act: CESTAT - Appeal partly allowed: DELHI CESTAT

2018-TIOL-1103-CESTAT-AHM

Shiv Lifters Vs CCE & ST

ST - Assessee availed certain services from their sister unit on which the sister unit did not pay service tax in time - It was found that as the sister unit has paid service tax along with penalty, in terms of Section 73(4A) of FA, 1994, therefore, they are not entitled to avail Cenvat credit on strength of supplementary invoices in terms of Rule 9(1) BB of CCR, 2004 - Proviso to Section 73(4A) is all in nature of settlement of dispute and as per the said provision if amount of service tax along with interest and 1% penalty during the period of default has been paid, in that circumstance proceedings are to come to an end - In that circumstance, allegation of fraud, collusion, wilful suppression of facts or non payment of service tax with intent to evade payment of service tax under the Act or Rule, cannot be held that these ingredients are there - In absence of these ingredients, in terms of Rule 9 (1) BB of Cenvat Credit Rules, Cenvat credit cannot be denied to assessee in the light of decision in case of Indian Oil Corporation Limited 2011-TIOL-1289-CESTAT-MUM - Impugned order set aside: CESTAT - Appeal allowed: AHMEDABAD CESTAT

CENTRAL EXCISE SECTION

NOTIFICATION

Notification nos. 7/2018-Central excise and 8/2018-Central excise, both dated 2nd February 2018 all dated 06.04.2018 rescinded

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Notification Nos.11/2017-CX dated 30th June, 2017, 10/2018-CX 11/2018-Central excise, 12/2018-CX and 13/2018-CX, all dated 2nd February 2018 amended

CASE LAWS

2018-TIOL-1101-CESTAT-CHD

Atma Tube Products Ltd Vs CCE

CX - Assessee have manufacturing unit at Derabassi and their depot at Ludhiana - During search, a large number of incriminating documents were recovered - The authorities found the evidence of clandestine removal of finished goods, raw materials and fraudulent credit entries in PLA - While recording the statements of Management Executives and Managing Director Sh. Deepak Singh, entries found in recovered documents were confronted to concerned persons and the same have been admitted by them - None of the documents which were recovered were disputed by assessee and none of the statements have been retracted - It is undisputed that assessee had taken credit in their PLA on different dates without making deposits of any amount in bank and utilized such illegal credit in PLA for clearance of excisable goods - This shows the wanton and deliberate violation of law done repeatedly over a period of time - Assessee had also evaded duty which has been worked out on the basis of details found in weighment slip books recovered from their factory but not found in corresponding invoices - These weighment slips were the authentic record of noticee and maintained by security guards, whose statements confirmed the authenticity of these slips and the modus operandi of clandestine removal - Order of Commissioner confirming the demand for the extended period alongwith interest and imposing penalties on assessee is upheld - The denial of Cenvat Credit as well as interest and penalty of same amount are upheld - Considering the systematic and planned suppression of production, clandestine removal of goods and clearance of goods without payment of duty, penalties under Section 11AC of the Act and Rule 9(2) and Rule 173Q are correctly imposed. As far the penalty on Sh. Deepak Singh, M.D., Sh. VK Sachdeva, General Manager (Finance) and Sh. N.M. Gupta, their involvement is complete and all pervasive as brought out hereinbefore - They were not only in knowledge of clandestine removal of goods on parallel invoices, fraudulent clearance of goods on the basis of credit taken without payment of duty in PLA and other modus operandi, they actively abetted such removal of goods - Hence, penalties on the Managing Director, Sh. Deepak Singh, Sh. V.K. Sachdeva and Sh. N.M. Gupta, are upheld.

It is settled position of law that in the remand proceedings the amount of penalty cannot be enhanced especially when there are no new facts or evidence to justify that - Besides, in impugned order, Commissioner has given no reason or basis to justify such enhancement - Penalty imposed on Sh. N.M. Gupta is reduced to Rs. 50,000/- and penalty imposed on Sh. V.K. Sachdeva is reduced to Rs. 1,00,000/-: CESTAT - Appeals partly allowed : CHANDIGARH CESTAT

2018-TIOL-1100-CESTAT-AHM

Manaksia Coated Metals And Industries Ltd Vs CCE

CX - Issue is regarding eligibility of Cenvat Credit of Service Tax paid by service providers under professional services as regard charges for expansion of production capacity - It is noticed from OIO that assessee has been taking a stand that these services were in regard to expansion/renovation work being carried out by them at Kutchh plant - On such categorical assertion made before Adjudication Authority, Adjudicating Authority has gone in tangent and recorded that the said services which are rendered are not for upcoming Galvanized Plant which is of expansion plant - Same views has been expressed by First Appellate Authority in impugned order - It is not clear from records as to how both the authorities have come to a conclusion that said expansion/renovation is not covered under definition of input service and especially under modernization/ renovation or repair of factory - Both the lower authorities were in error in rejecting the claim of assessee as to eligibility to avail cenvat credit: CESTAT - Appeal allowed: AHMEDABAD CESTAT

2018-TIOL-634-HC-KAR-VAT

Clix Finance India Pvt Ltd Vs State Of Karnataka

Ergomaxx (India) Pvt Ltd Vs State Of Tamil Nadu