SERVICE TAX
2018-TIOL-1656-CESTAT-MUM + Case Story CCE Vs Saurabh Constructions
ST - All the services which are provided to Maharashtra State Electricity Transmission Company Limited 'in relation to' transmission of electricity are exempted by notification 45/2010-ST & 11/2010-ST – no cause to deny exemption to services of CICS and Manpower supply – impugned orders are just and legal and need no interference - Revenue appeals dismissed: CESTAT [para 6] - Appeals dismissed: MUMBAI CESTAT
2018-TIOL-1655-CESTAT-HYD
Sew Infrastructure Ltd Vs CCE, C & ST
ST- The Assessee is engaged in the business of construction of bridges and road laying for National Highways - For the period of 2004-2006 the Assessee was executing a Hydel Project in MP - The Assessee had discharged the service tax liability on the construction work undertaken by them under the category of CICS - However, at a later stage the Assessee was of the view that these services would fall under works contract and not under CICS & filed for refund - The claim for refund was rejected by the Revenue - On remand Commr.(A) held that the activity undertaken for the period of 2004- 2006 was works contract - The Assessee approached the Tribunal for deciding if the activities undertaken by them would fall under composite works contract as against the view of the Revenue that the activity undertaken is of commercial nature -
Held - Following the ratio laid down in Larsen & Toubro Ltd by the Apex Court, the order in challenge warrants no interference: CESTAT (Para 3,7,8) - Appeals Dimissed: HYDERABAD CESTAT
2018-TIOL-1654-CESTAT-DEL
Sakata Inx (India) Ltd Vs CCE
ST - Assessee engaged in manufacture of Printing Inks - With a view to obtain technical support required for manufacturing, quality control, research and development of technical issues, they have entered into an agreement with their parent company, M/s Sakata Inx Corporation (M/s SIC), Japan, who agreed to depute their technical experts on employment basis - The assessee have agreed to issue appointment letters to Japanese experts and also pay monthly salaries in rupee to technical experts - While obtaining residential permit from Foreigner Registration Office, Gurgaon, the Japanese experts reported their purpose of visit of India for employment to work with assessee as Technical Head - The TDS was deducted on the basis of salary - During audit, it was viewed that the parent company, M/s SIC, supplied manpower from abroad to assessee in India and the same is taxable under heading ‘Manpower Recruitment and Supply Agency Services' - An identical issue has come up for consideration before Tribunal in case of Airbus Group India Pvt. Ltd. 2016-TIOL-2312-CESTAT-DEL , wherein it was observed that when the global employees working under Indian company are working as their employees and having employee-employer relationship there is no supply of manpower service and no tax liability arises - No merit found in impugned order and same is set aside: CESTAT - Appeal allowed: DELHI CESTAT
2018-TIOL-1653-CESTAT-DEL
Vision Freight Solutions India Ltd Vs CCE & ST
ST - the assessee comapny provides storage and warehouse service, which includes providing storage space, infrastructure & inventory management - It also provides Goods Transportation Agency services for pick-up & drop of the goods to and from the warehouse - The assessee entered into an agreement with an entity, wherein all services were mentioned separately & separate charges were mentioned for each - The Department claimed such services to be of a composite nature & that the assessee was liable to pay tax on all the services combined - Further, duty demand was raised on 'reimburseable expenses' under Rule 5(1) of the Service Tax (Determination Value) Rules, 2006 - Lastly, the assessee paid service tax by availing Cenvat credit on inputs & input services - However, such availment was challenged by the Revenue -
Held - Prior to 01.07.2012, the services mentioned in a composite agreement, would have to be treated differently, since the assessee had mentioned them separately - Matter merits remand for this purpose - Further, Rule 5(1) of the Valuation Rules was declared ultra vires by the Apex Court in Union of India and Anr V/s M/s Intercontinental Consultants and Technocrats Pvt. Ltd. - Thereby, no duty demand can be raised where the charging section has been declared invalid - Lastly, availment of Cenvat credit warrants fresh examination - Evidently, tax on storage & warehousing charges was paid prior to VCES period as well as through VCES period through declaration - In later period, penalty wih interest was paid before issue of SCN - Hence no penalty can be levied: CESTAT (Para 4,8,10,13,14) - Appeals Partly Allowed: DELHI HIGH COURT
CENTRAL EXCISE
2018-TIOL-1649-CESTAT-AHM
Ambuja Intermediates Ltd Vs CCE & ST
CX - Assessee had availed cenvat credit of Service Tax paid on various services which were used for manufacturing activities at their factory/plant as well as for generation of electricity at Wind Mills situated outside the factory - Alleging that assessee has sold electricity to Gujarat Energy Transmission Company Ltd (GETCO), hence, 6% of value of electricity energy sold was demanded under Rule 6(3) of CCR, 2004; also Cenvat Credit of Rs 4,71,245/- availed on 'Repair and maintenance Services' for their Wind Mill situated away from factory was demanded - Commissioner (A) had allowed Cenvat Credit of Service Tax paid on input services viz., 'Repair and Maintenance Service' and 'Works Contract Services' in relation to 'Repair and Maintenance service' used for generation of electricity in Wind Mill situated away from the factory following the Larger Bench judgment in case of Parry Engg & Electronics (P) Ltd 2015-TIOL-3059-CESTAT-AHM-LB however, denied credit on other common input services used for maintenance of wind mill and also manufacturing activity - No merit found in denying credit on other input services common for manufacturing activity and running of wind Mill, when credit of service tax paid on repair & maintenance service is allowed - In SCN, it is also alleged that assessee had sold a part of electricity generated in wind mill, which the assessee had vehemently denied by producing evidences to the effect that no part of electricity generated in Wind Mill has been sold by them but the entire quantity is used in factory premises of assessee - Only for limited purpose of verification whether electricity energy generated at Wind Mill was sold or otherwise, matter is remanded to Adjudicating Authority: CESTAT - Matter remanded: AHMEDABAD CESTAT
2018-TIOL-1648-CESTAT-MUM
Flomatic Engineers Vs CCE
CX - Whether notional interest on the advance deposit collected by the appellant against supply of goods is includible in the assessable value of final product or otherwise.
Held: There is no dispute in the fact that the goods supplied by the appellant are not uniform/standard but every machine is tailor-made - therefore, if the advance deposit is not collected and at the time of supply if the buyer refuses to purchase the machine there will be no security to the appellant, therefore, the reason of taking advance deposit towards the supply of tailor-made machine is justified - moreover, no price of comparable goods is available to establish that the price was influenced due to notional interest against collecting the advance deposit - department also could not adduce any evidence to establish that the price of machine is influenced by taking advance deposit - apex court decision in ISPL Industries Ltd. - 2003-TIOL-98-SC-CX directly applies in the present case - inclusion of notional interest in the Assessable value is not justified - impugned order set aside and appeal allowed: CESTAT [para 4] - Appeal allowed: MUMBAI CESTAT
CUSTOMS
CIRCULAR
cuscir12-2018
Sanction of pending IGST refund claims where the records have not been transmitted from the GSTN to DG Systems
CASE LAWS
2018-TIOL-1652-CESTAT-MUM + Case Story
CC Vs Chiripal Industries Ltd
Cus - Ministry of Finance, Department of Revenue was required to act in tandem with the DGFT and Ministry of Commerce - Under Notification No. 1(RE-2008)/2004-09 dated 11.4.2008, the Foreign Trade Policy amendment w.e.f. 1.4.2008 had reduced the prevailing customs duty rate in respect of EPCG scheme from 5% to 3% - While policy was amended, Notification of customs implementing the said change was issued on 9.5.2008, 39 days after the issue of DGFT notification - ideally there should not be any discord between the EPCG and the Customs authorities - Appellants were issued a licence as well as authorization prescribing 3% rate of duty - In these circumstances, failure of customs authorities to issue notification on time cannot be held against the respondent - no merit in Revenue appeal - impugned order upheld and Revenue appeal dismissed: CESTAT [para 4, 4.1, 5] - Appeal dismissed: MUMBAI CESTAT
2018-TIOL-1651-CESTAT-MUM
ISMT Ltd Vs CCE
Cus -Whether export duty is required to be paid in respect of goods supplied to SEZ and EOU units or not stands decided by Gujarat High Court in the case of Essar Steel Ltd. - 2009-TIOL-674-HC-AHM-CUS where it is held that export duty can be levied only under the Customs Act, 1962 and not SEZ Act and which stands upheld by the Supreme Court - 2010-TIOL-50-SC-SEZ when the appeal filed by the Revenue was rejected - impugned order set aside and appeal allowed with consequential relief: CESTAT [para 1, 2] - Appeal allowed: MUMBAI CESTAT
2018-TIOL-1650-CESTAT-DEL
Jiangsu Faw Foundry Company Ltd Vs UoI
Anti-Dumping Duty - The Appellants were engaged in the export of PUC to India - The initiation of Anti-Dumping investigation against import of PUC in India was initiated by the DI & later, duty was imposed on imports of "Castings for Wind Operated Electricity Generators" (PUC) imported from China - Further, the DA observed that the return on capital and profit are substantially negative for the DI leading to injury to the DI -
Held - In respect of scope of PUC and DI as well as the imposition of AD duty alleging no injury to the DI, it is noted that the DA has applied the provision of Rule 11 of the AD rules r/w Annexure II for determining the injury - After detailed analysis of demand, import volume, market share, price effect of imported goods, price undercutting, under selling, price suppression & depression and also the economic parameters of DI, the DA arrived at the conclusion regarding existence of dumping and its consequence on the DI causing injury - On considering appeal by the DI wherein the DA erred in quantifying the dumping margin and injury margin as the DA adopted the same weight comparison for normal value, non-injurious price, export price & landed price of imports - The exported goods were mainly machined castings - Here, the comparison made is with rough castings made by DI - Hence the DA is directed to examine, afresh, the factual claims made by the DI & fix the duty accordingly: CESTAT (Para 2, 3, 13, 14, 15, 16) - Appeal Partly Allowed: DELHI CESTAT
|
