SERVICE TAX
2018-TIOL-1543-CESTAT-MAD
CST Vs Consolidated Construction Consortium Ltd
ST - the assessee provided works contract services - The taxable rate was 2% prior to 1.3.2008 & 4% for services provided after 1.3.2008 - In cases of services being provided prior to 1.3.2008 & payments being realized after 1.3.2008, the Department claimed that highr rate of 4% was applicable - Demand for differential duty was raised with interest & imposition of penalty - On appeal, the Commr.(A) held that the taxable event is date of rendering of taxable services & so lower rate of 2% was applicable - Hence the Revenue's appeal.
Held - The findings of the Commr.(A) are based on the decision of the High Court of Gujarat in Commissioner of Central Excise Vs. Schott Glass India Pvt. Ltd - 2009-TIOL-82-HC-AHM-ST Also the decisions cited by the assessee support the findings of the Commr.(A) - Hence the O-i-A warrants no interference: CESTAT (Para 1,5) - Revenue's appeal dismissed: CHENNAI CESTAT
2018-TIOL-1542-CESTAT-MAD
Karur Vysya Bank Ltd Vs CCE
ST - the assessee supplied infrastructure like table, chair, network, electricity & telephone to insurance companies during the period of dispute - The Department claimed that such services fell within the ambit of Business Support Services u/s 65(104c) of the Finance Act, 1994 - The Department alleged that the assessee did not discharge tax liability - Hence, duty demands were raised with interest & imposition of penalties u/s 76 & 77 of the Act - Such findings were upheld by the Commr.(A).
Held - For the infrastructural support provided the assessee received some consideration - Hence such activity would squarely classify as Business Support Service - Hence duty demand with interest is upheld - Besides, the assessee was under the bona fide impression that the tax liability under Business Support Services was not on it but on the insurance companies - It carried such plea up till the Tribunal - Hence penalty u/s 76 is unwarranted - Nonetheless, penalty u/s 77 is upheld: CESTAT (Para 1,6,7,8) - Appeal Partly Allowed : CHENNAI CESTAT
2018-TIOL-1538-CESTAT-MAD
Siemens Building Technologies Pvt Ltd Vs CCE
ST - the assessee company manufactures access control system, fire control system & parts thereof - Based upon intelligence that the assessee did not pay tax on payments received from outside India under the category of 'Consulting Engineer Service', duty demand was raised for the same - Such tax was paid by the assessee before issue of SCN - The Department also claimed that the assessee had not reversed credit availed on rejected inputs which were removed from the factory for testing & thereafter brought into the factory - The Department further claimed that the assessee availed credit for a second time on such inputs - It was also alleged that service tax on Consultancy Services had been paid after a 15-day delay - SCN was issued to the assessee, alleging suppression of facts with intent to evade payment of duty - Later, duty demands were raised with interest & equivalent penalty.
Held - Assessee does not contest duty demand & interest paid for non-payment of service tax under reverse charge mechanism - Since entire duty demand with interest was paid prior to issue of SCN, no penalty should have been imposed - Hence penalty is set aside - Further, the assessee attributed the double availment of Cenvat credit to inadvertent mistake - However, reduced penalty of 25% of duty paid was upheld - So penalty on such issue stands discharged as assessee paid 25% of duty demand - Lastly, while assessee does not contest duty demand with interest on non-payment of duty under Reverse charge, it is aggrieved by the penalty - Such penalty is not imposable for mere delay in payment of tax - Hence out of penalties imposed on three counts, two are set aside: CESTAT (Para 1,6-8) - Appeal Partly Allowed : CHENNAI CESTAT
CENTRAL EXCISE
2018-TIOL-1541-CESTAT-MUM + Case Story
Exide Industries Ltd Vs CCE & ST
CX - If an input is cleared on reversal of CENVAT credit availed on such inputs, the question of invoking the provisions of Rule 6(3A) of the CCR, 2004 does not arise – impugned order set aside and appeal allowed: CESTAT [para 5, 6] - Appeal allowed : MUMBAI CESTAT
CX- the assessee is engaged in manufacture of sugar and various by products like molasses, industrial alcohol, ethanol etc- During the course of assessment proceedings from December, 2004 to April, 2012 it was found that assessee has classified ethanol under Chapter 2938 opting to pay central excise duty with cess- Revenue was of the view that ethanol would fall under chapter heading No. 2207 and is exempted from payment of duty-Assessee having discharged the central excise duty on ethanol under chapter 29- Assessee claimed benefit of exemption on the captively consumed molasses for manufacturing of ethanol and CENVAT credit of duty paid on molasses procured from other manufacturers-Duty demand was raised for central excise duty on molasses which are captively manufactured and consumed for manufacture of ethanol, which is exempted under notification No. 3/2005-CE (un-denatured ethyl alcohol)- Assessee had already discharged excess duty than what was demanded on molasses-Revenue upheld the OIO confirming demands alongwith interest and penalties.
Held - The Tribunal held that the entire exercise is revenue neutral and the issue of discharge of central excise duty on un-denatured ethyl alcohol by not availing the benefit of exemption was within the knowledge of the department- The Tribunal relied on Jet Airways Limited (Tri.- Mum.) - 2016-TIOL-2072-CESTAT-MUM and set aside the demand of duty on molasses, penalties and interest: CESTAT (para 2, 6,7,8,9) - Appeal Dismissed : HYDERABAD CESTAT
2018-TIOL-1539-CESTAT-BANG
Adcock Ingram Ltd Vs CCE, C & ST
CX - Assessee has manufactured P&P medicaments on loan licensee basis for M/s. Sanofi Synthelabo (India) Ltd. and has availed CENVAT credit of duty paid on inputs supplied by said supplier - Revenue issued a SCN alleging that assessee has wrongly availed CENVAT credit on endorsed Bills of Entry consigned to M/s. Sanofi Synthelabo (India) Ltd. - Issue is no more res integra in view of decision in assessee's own case vide Final Orders dt. 07/10/2014 and 04/08/2017 as also other decisions in Marmagoa Steel Ltd. 2008-TIOL-249-SC-CX , Vimal Enterprises 2005-TIOL-235-HC-GUJ-CX and Cropcare Ltd. 2016-TIOL-2151-CESTAT-DEL - By following the ratio of said decisions, appeal of assessee is allowed by setting aside the impugned order: CESTAT - Appeal allowed : BANGALORE CESTAT
CUSTOMS
2018-TIOL-1549-CESTAT-MUM + Case Story
Flemingo Duty Free Shop Pvt Ltd Vs CCE & ST
Cus - Demand of Customs duty on the warehoused goods which has been stolen from the duty free shops by some CISF and police personnel cannot be demanded from the Appellant: CESTAT [para 5, 6, 9] - Appeal allowed
: MUMBAI CESTAT
2018-TIOL-1537-CESTAT-MAD
Vodafone Essar South Ltd Vs CC
Cus - the assessee company is a leading provider of telecommunication services - It imported such optical fibre cables and classified them as '48 Optical Fibre Cables' under Heading 8544 70 - The assessee availed exemption under Notfn No 24/2005 - However, the Department opined that the goods were classifiable under Tariff 90011000 as 'Bundled Optical Fibre Cable' and so denied benefit of exemption - On adjudication, the classification favored by the Revenue was upheld.
Held - The issue at hand stands settled by the larger bench of the Tribunal in Commissioner of Customs, Mumbai vs. Vodafone Essar Gujarat Ltd - 2017-TIOL-4586-CESTAT-MUM-LB . wherein optical fibres were held to be classifiable under CTH 90011000 - Following such precedent, the present appeal is devoid of merit: CESTAT (Para 1,3) - Appeal Dismissed : CHENNAI CESTAT |
by Shailendera Kumar 
