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SERVICE TAX
2018-TIOL-1916-CESTAT-CHD
CST Vs DLF Projects Ltd
ST - Assessee engaged in providing taxable services under categories of construction of commercial and industrial building, construction of residential complex, transport of goods by road, management consultants, site preparation and clearance, architect services and real estate agents services - During audit, it was noticed that the noticee was having 14 running projects on which they availed the scheme available under Works Contract (Composite scheme for payment of Service Tax) Rules, 2007 w.e.f. 01.06.2007 - Further, the noticee appeared to have short paid Service Tax on the advances received for providing taxable services and also appeared to have taken the benefit of Notfn 12/2003 - Whether the assessee is entitled for exemption of services provided in SEZ during the period April 2000 to March 2010 in terms of Provisions of Section 26 of SEZ Act, 2005 - A similar issue was examined by Tribunal in case of Tata Consultancy Services Ltd. wherein it is observed that assessee are entitled for exemption from payment of service tax on the services which are used or provided to a unit in the SEZ - The issue was also examined by Tribunal in case of Intas Pharma Ltd. - As the issue has already been settled by Tribunal holding that assessee is entitled for exemption on services provided in SEZ, therefore, no infirmity found in impugned order, same is upheld: CESTAT - Appeal dismissed: CHANDIGARH CESTAT
2018-TIOL-1915-CESTAT-AHM
Diamond And Gem Development Corporation Vs CCE & ST
ST - Assessee had provided Repair & Maintenance Service and Renting of Immovable Property Service to the units located in SEZ - They have filed refund claim of service tax paid on such services in Form A-2 under Notfn 9/2009-ST - Same was rejected by lower authorities - It is not in dispute that assessee had provided these services to units in SEZ and claimed the refund under Notfn 9/2009-ST - The department rejected the refund claim on the ground that the exemption from payment of service tax of services used in SEZ is allowed by way of refund to the service receiver situated in SEZ - There is no room for any intendment in interpretation of said exemption Notfn, which has to be strictly interpreted - The only exception carried out in said notification is that in the event the service provider and service receiver are one and the same person, service provider could claim the refund of service tax paid on specified services used in SEZ - Claimant of refund is not the service receiver, but, the service provider, accordingly, Commissioner (A) has rightly upheld the rejection of refund claim and no reason found to interfere with said order - Impugned order upheld: CESTAT - Appeal rejected: AHMEDABAD CESTAT
2018-TIOL-1914-CESTAT-DEL
Autodesk India Pvt Ltd Vs CST
ST- The assessee- company is a wholly owned subsidiary with headquarters in USA - They are into providing marketing and technical support services for the products to the assessee-company's branch in Singapore - The Department issued show cause notice raising demand of ST along with interest and penalties - The Revenue Authorities confirmed the demand on commercial training service, real estate agent service, internet telecommunication service as well as management, maintenance or repair service and imposed penalty under the FA Act, 1944.
Held - With regard to ST demand, the consideration for these services were received from the foreign principal in foreign exchange - The activities are to be considered as export of services and hence no service tax is liable to be charged for such activities - Further, the demand in respect of internet telecommunication services is set aside due to lack of sufficient documents to establish that the services were availed through internet - Hence, these services cannot be classified under internet service provider service - Therefore, the demand of ST is set aside : CESTAT (Para 2, 9, 10, 11, 12, 13, 14) - Partly Allowed: DELHI CESTAT
CENTRAL EXCISE
2018-TIOL-1918-CESTAT-DEL
Arora Tobacco Pvt Ltd Vs CCE
CX - The assessee is engaged in the manufacture of branded chewing tobacco - During the period in dispute, the assessee was functioning under the CTD Rules & was operating two machines - During this period no production took place - However, the two machines were un-sealed by the assessee under physical supervision of the jurisdictional CE officers - When the machines were in operation, the assessee computed duty liability and deposited part of amount with the Revenue - When Revenue insisted upon payment of entire duty in advance, the assessee did so and subsequently filed claim for refund - The Revenue opined that some part of the refund claim was inadmissible as the assessee had not commenced the manufacture of notified goods - While SCN was issued denying part of the refund claim, the Commr. (A) disallowed part of refund claim & sanctioned the rest in terms of 4th proviso to Rule 9 of CTD Rules.
Held - In cases, where the production of goods of a new RSP, which has not been earlier manufactured during the month, is commenced by the manufacturer, even if the goods bearing such RSP were being manufactured in the earlier months - The assessee is entitled to benefit of 4th proviso to Rule 9 - This follows from the decision of S.A. Freshners Pvt. Ltd. Vs. CCE - The wordings "permanently/new" in the rules, cannot be interpreted to mean that such discontinuation or commencement shall never be manufactured in future or shall never have been manufactured earlier - Hence, the order challenged is set aside: CESTAT (Para 1, 5, 6) - Appeal Allowed: DELHI CESTAT
2018-TIOL-1917-CESTAT-CHD
Kanin India Vs CCE
CX - Assessee engaged in manufacture of staplers which are liable to pay duty in terms of Section 4A of CEA, 1944 i.e. on MRP basis assessment - During the period in dispute, a promotional scheme offered to its dealers - As per said scheme, assessee also cleared staple pins of specified quantity along with staplers manufactured in their factory - Based on investigation, SCN was issued to assessee in terms of para 4 (ii) of CBEC Circular 673/64/2002-Cx - Thereafter adjudication took place and demand was confirmed along with interest and equivalent amount of penalty was imposed on them - Short issue involved is whether the assessee is required to pay duty on the basis of MRP on bought out staple pins cleared in separate master cartons from the factory of assessee, supplied free of cost with the stapler manufactured by assessee - Admittedly, stapler and staple pins are different commodities and the staple pins were given free along with staplers, in that circumstance, it cannot be termed as two or more individual packaged or labelled pieces of the same commodity or identical quantity are packed - In fact, stapler and staple pins even not cleared in single package or unit container and these are also not cleared together in single carton - It cannot be said that these goods cleared in multi piece package - Therefore, para 4 (ii) of CBEC Circular No.673/64/2002-Cx is not applicable to the facts of this case - Staple pins are not manufactured by assessee, these are bough out items and it is a fact on record that these staple pins are supplied by assessee free of cost - Therefore, value of bought items shall not form the part of assessable value of staplers - As the issue is debatable in nature, therefore extended period of limitation is not invokable: CESTAT - Appeal allowed: CHANDIGARH CESTAT
CUSTOMS
NOTIFICATION /CIRCULAR
cnt55_2018
CBIC notifies new Customs exchange rates effective from Friday
dgft17cir008
Clarification on SEIS benefits to Steamer Agents
CASE LAW
Sharu Steels Pvt Ltd Vs CC
Cus - Assessee filed bill of entry for consignment of light melting steel scrap turning, purchased on high sea sale basis - The goods were examined and were found to be stainless steel/alloy steel mixed grade whereas the assessee had described light melting steel scrap turning - Revenue engaged a Chartered Engineer Shri Anil Kumar Soni for his opinion on the type of scrap and value of the same who opined that the items found during inspection was mix SS & Alloy Steel Scrap turning found loose in unshedded form and CIF value of the same would around USS 600 per MT - The proceedings were initiated by issue of SCN to assessee alleging misdeclaration of goods as also undervaluation of same and proposed enhancement of value - Member (Judicial) held that the opinion of the chartered engineer, who is not a metallurgical engineer, should not be relied upon and value can not be enhanced on that basis while Member (Technical) held that when the goods were mis-declared as admitted by Shri. K. K. Garg, M.D., the valuation of the goods can be determined on the basis of opinion of chartered engineer based on cotemporaneous bills of entry of similar scrap - As there are contrary views and difference of opinion between the Members, therefore, matter placed before third member to resolve the issues wherein it is found that said chartered engineer was empanelled for valuation of second hand machinery and he was mechanical engineer and as per the said Public Notice, he did not have authority to give opinion on metals - Original authority has not discarded the transaction value as required under Section 14 of Customs Act, 1962 - Further, original authority has not exercised his power to adjudicate the same but simply adopted the opinion suggested by said chartered engineer who did not have authority as empanelled chartered engineer relating to metals - Therefore, opinion of Member (J) founds proper.
In view of the majority order, both the appeals are allowed: CESTAT - Appeals allowed: CHANDIGARH CESTAT
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