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SERVICE TAX
2018-TIOL-1613-CESTAT-MUM + Case Story Amit Enterprises Vs CCE
ST - Section 70 of the Finance Act, 1994 - Rule 7C of the STR, 1994 - Admitted failure to file returns - Various grades of fees are enumerated and contingent upon the extent of delay in filing the returns - Appellant has no ground to seek relief which is not available under rule 7C of the Service Tax Rules, 1994 - there is a legal obligation on the part of the assessee to discharge the late fee without the intervention of the adjudicating or any other authority designated in the Finance Act, 1994 - Appeal dismissed: CESTAT [para 3, 4] - Appeal dismissed: MUMBAI CESTAT
2018-TIOL-1612-CESTAT-HYD
IVRCL Infrastructure And Projects Ltd Vs CCE,C & ST
ST - the assessee company executed a contract for fabrication & laying of pipelines for a refinery - Herein, the refinery would supply the requisite material, free of charge - The assessee paid service tax under Commercial or Industrial Construction Services on the consideration received & without including the value of the material supplied for free - The Department opined that the value of such goods were to be included in the gross consideration - Duty demand was raised & was later upheld by the Appellate authority.
Held - The issue at hand is no longer res integra and stands settled by the Apex Court in its decision in Bhayana Builders (P) Ltd - Herein the Larger Bench of the Tribunal held that cost of free supply of the materials were not to be included when determining gross value for calculation of service tax - The Apex Court upheld such findings - Regarding the assessee's claim that exemption under Notfn No 04/2004-ST were not provided to it, the duty warrants re-quantification, as such plea was hitherto not raised by the assessee: CESTAT (Para 2,5,6) - Appeal Allowed: HYDERABAD CESTAT
2018-TIOL-1611-CESTAT-HYD
Vasantha Green Projects Vs CCT, Rangareddy GST
ST - The assesee is registered for providing residential complex service & works contract services - It entered into joint development agreement for construction of houses with different landowners - With regard to a particular project, the Department conducted an audit and then issued SCN proposing demand for duty, on grounds that the assessee had not paid service tax on amount received from land owners towards allotted share of developed property - The SCN invoked extended limitation and relied on a Board clarificatio dated 10.02.12, which vested tax liability on builders for construction services in flats & houses given to land owners - The duty demand was based on the nearest sale value to the villas - The assessee contested the valuation adopted by the Department - Later duty demand was raised with interest & imposition of penalty.
Held - Considering the facts and circumstances, simply because the consideration received from land owners was invested by the assessee to construct villas sold to other buyers, it cannot be said that service tax paid on such consideration received from land owners has to be evaluated differently - Besides, the assessee paid service tax on value received from its customers to whom the villas were to be sold - Thereby, if consideration for acquisition of land is included in the value of the villas sold to customers & service tax is paid on the same, the assessee cannot again be made liable to pay service tax - The payment of tax and method of valuation have been proven by the certificate issued by the Chartered Engineer - This further shows there to be no mala fide intent to evade payment of duty - Hence invoking of extended limitation is unjustified - Thus, the demands raised are unsustainable: CESTAT (Para 2,5,7,9,14) - Appeal Allowed: HYDERABAD CESTAT
CENTRAL EXCISE
2018-TIOL-970-HC-AP-CX Ravi Foods Pvt Ltd Vs Commissioner (Appeals)
CX - the assessee is engaged in manufacture of biscuits and wafers & confectionary items - The assessee exports the same and also sells them in the domestic market - Regarding exported goods, the assessee paid duty on transaction value u/s 4 of the CEA 1944 - It availed Cenvat credit on inputs - The assessee claimed to have made no sale in Indian currency and that it executed the orders in USD - The assessee claimed rebate of excise duty paid on the biscuits so exported & such rebate was allowed - The Commr.(A) set aside such grant of rebate, on grounds that the goods manufactured were unconditionally exempt from duty & so duty paid on them would not enable the assessee to claim rebate - Hence the present writ.
Held - it may be noted that the assessee has the alternate remedy of appeal to the revisionary authority u/s 35EE of the Act but the assessee bypassed the same, on the rationale that the revisionary authrity and the Commr.(A) were officers of equivalent rank - Although the Govt did later appoint superior officers as revisionary authorities the assessee cannot be driven to approach the revisionary authority - Besides, the Commr.(A) concluded that the exemption was absolute on grounds that there was no necessity for the packages to bear the retail sale price & that availing Cenvat credit was unnecessary - However, such findings are incorrect since they run contrary to the HC decision in Repro India Ltd. v. Union of India wherein it was held that failure to fulfill export obligations, may result in other consequences & so grant of Cenvat Credit is relevant - Hence the O-i-A is set aside: HC (Para 3,4,5,6,20-26) - Writ petition allowed: ANDHRA PRADESH HIGH COURT
2018-TIOL-1618-CESTAT-MUM + Case Story CCE Vs Indian Oil Corporation Limited
CX - CENVAT credit - Internal records showed lesser receipt of base oil vis-à-vis that reflected in the invoice - in the absence of any exercise having been carried out before issue of the SCN as mandated by the LB decision in Bhuwalka Steel Industries Ltd. - 2010-TIOL-19-CESTAT-MAD-LB , the claim of the Revenue to set aside the impugned orders passed by the Commissioner(A), extending the credit to the extent of permitted tolerance and allowing re-credit of duty discharged on the short-receipts, is not tenable - Revenue appeals dismissed: CESTAT - Appeals dismissed
: MUMBAI CESTAT
Penna Cement Industries Ltd Vs CCE, C & ST
CX- The Assessee is engaged in manufacture & sale of cement and trading - During the relevant period, the Assessee availed CENVAT credit of the Excise duty paid on inputs like cement and steel and input services like site formation services, erection, commissioning and installation services and commercial and industrial construction services - Further, the Assessee availed CENVAT credit of service tax paid on GTA services - The Department opined that the cement, TOR steel & structural steel cannot be considered as inputs as these were used for making foundation and structural support for the factory premises and the machinery which were put in place - The Commr.(A) confirmed the duty demand and imposed penalties.
Held - Considering various precedents of the HC, input services like GTA services, cement, TOR steel, structural steel is eligible for CENVAT credit, as they were used for setting up of a new factory - Hence demands are unsustainable: CESTAT (Para 1, 4, 5, 6) - Appeal Allowed: HYDERABAD CESTAT
2018-TIOL-1609-CESTAT-HYD
Voith Turbo Pvt Ltd Vs CCT, Secunderabad GST
CX - the assessee company manufactured hydraulic/fluid couplings - It availed Cenvat credit on input goods & services - The Department noted that the assessee cleared a consignment to M/s NTPC Ltd, without payment of duty & that the assessee did not reverse Cenvat credit under Rule 6(3) availed on the exempted goods - Duty demand was raised with interest for recovery of the same - Penalty was imposed under Rule 15(2) of the Act r/w Section 11AC of the CEA, 1944 - Such duty demand & interest were upheld by the Commr.(A) who nonetheless reduced the penalty - Issue at hand revolves around meaning of the words "which are exempt from the duties of customs" u/r 6(6)(vii) of CCR, 2004 & whether the assessee is guilty of suppression of facts & misstatement with intent to avoid payment of duty.
Held - The harmonious interpretation of this expression with other provisions of the CCR requires one to interpret as the goods which are fully exempted from duty - Hence 2.5% Customs duty will not make the goods to be exempted from duty - The assessee's claim that partial exemption be treated as an exemption goes against the scheme of the CCR, 2004 - Hence the assessee is not exempted from reversing credit u/r 6(3) of CCR - In its relevant records, the assessee declared the availment of credit as well as benefit under Notfn No 12/2012 - In its ER-1 returns, it also declared that it did not reverse the credit - Hence the assessee cannot be charged with suppression of fact or misstatement with intent to evade payment of duty - Hence penalty be set aside & interest be reduced: CESTAT (Para 1,9,10) - Appeal Partly Allowed: HYDERABAD CESTAT
CUSTOMS
2018-TIOL-969-HC-AHM-CUS
CC Vs Sadhuram Jayprakash
Cus - The assessee being an importer of log of woods, would cut such logs into smaller pieces before sale and claimed benefit of exemption Notification No. 102/2007-Customs - The Department opined that the claim on the ground that the importer had not sold the goods in the same condition and therefore breached one of the conditions of the exemption notification - Revenue appealed against Tribunal's order, which relied on Commissioner of Customs vs. M/s. Variety Lumbers Pvt. Ltd and found that the Assessee had not breached any of the conditions of the exemption notification.
Held - Considering the relevant portions of the decision in Commissioner of Customs vs. M/s. Variety Lumbers Pvt. Ltd , there is no infirmity in the view taken by the Tribunal: HC (Para 1, 2, 3) - Appeal Dismissed: GUJARAT HIGH COURT
2018-TIOL-968-HC-DEL-CUS
Shubh Impex Vs UoI
Cus - The assessee company imported 'hooks and eyes fastening strips' and classified it under CTH 83081010 - However, the Revenue claimed it to be classifiable under CTH 6212 & raised duty demand - Although the assessee had option of appeal to appellate authority, it would need to pre-deposit 7.5% of the duty demand - Considering its turnover, the assessee would lose all its income & suffer irrepairable financial loss - Hence the present writ.
Held - Considering such facts & circumstances, the pre-deposit payable is reduced - Upon payment of the same, the assessee may approach the Commr.(A): HC (Para 2-8,10) - Writ Petition allowed: DELHI HIGH COURT |
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