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SERVICE TAX
2018-TIOL-2001-CESTAT-MAD
Sree Saradambal Automobiles Pvt Ltd Vs CCE
ST - The assessee are providing services under the cartegory of "Authorized Service Station" - The Department opined that assessee is required to discharge service tax on incentives received from insurance companies - An SCN was issued on grounds that activities of the assessee fell within the fold of "actuary" payable under "Insurance Auxiliary Service" - Duty demand was raised with interest & penalty was imposed.
Held - The assessee have to fulfil requirements mandated in the Insurance Act, 1938 r/w the Actuaries Act, 2006 - In addition, IRDA Regulations 2000 state that insurer registered to carry on insurance business cannot carry on such business without an appointed actuary - Such actuary has to be a Fellow Member of the Actuarial Society of India, an employee of the life insurer (in case of Life Insurance business or General Insurance business), a person who possesses a Certificate of Practice issued by the Actuarial Society of India - The assessee does not possess any of these qualifications nor they have been appointed or registered as "actuary" - Therefore, the SCN is invalid as it cannot be established that assessee has availed the services of "actuary" - Hence, the order challenged is set aside: CESTAT (Para 1, 4, 5, 6) - Appeal Allowed : CHENNAI CESTAT
2018-TIOL-2000-CESTAT-MUM
Maharashtra State Road Transport Corporation Vs CCE
ST - Appellant is engaged in the activity of providing buses on hire/rent on casual contract basis - case of the department is that this activity is taxable as Rent-a-cab operator service - demand confirmed by lower authorities, therefore, appeal before CESTAT.
Held: Appellant M/s MSRTC is not handing over the buses on long time running agreement whereas the ownership of the buses is retained by the appellant and they are providing the buses on Kilometer basis for a particular destination as per the choice of the passengers - There is no person involved as a recipient of a Rent-a-cab service to whom the buses is handed over under a rent agreement, therefore, it does not fall under the category of rent-a-cab service - issue is squarely covered by the judgment of Shree Gayatri Tourist Bus Service - 2012-TIOL-475-CESTAT-AHM - impugned order is, therefore, set aside and appeal is allowed: CESTAT [para 4, 5] - Appeal allowed : MUMBAI CESTAT
2018-TIOL-1999-CESTAT-MUM
Comm of CGST Vs Ugam Solutions Pvt Ltd
ST - Issue is regarding denial of refund to assessee in respect of CENVAT Credit availed on service tax paid on various input services during period January 2012 to December 2014 - Assessee's global expertise provides clients with specialist knowledge in Multi-country Project Management, International Data Collection and Healthcare Data Solutions using multiple market research platforms and proprietary technologies - Revenue is only stating that post April 2014, definition of ‘input service' has undergone a change which has deleted the services in relation to business activity and is not to be considered as in or in relation to business of assessee - Argument on behalf of Revenue in grounds of appeal found without any merits as similar / identical issue of was considered by Division Bench of this Tribunal in case of WNS Global Services 2016-TIOL-1275-CESTAT-MUM and Reliance Industries Ltd. 2016-TIOL-2392-CESTAT-MUM and appeals were allowed in favour of assessee - Respectfully, following the ratio in said decisions, impugned order is correct and legal and does not require any interference: CESTAT - Appeals rejected : MUMBAI CESTAT
2018-TIOL-1998-CESTAT-DEL
HEM Finlease Pvt Ltd Vs CCE
ST - Whether, turn over charges / transaction fee recovered on actual basis by assessee from their customers / stock brokers and deposited with respective Stock Exchanges, should form part of gross amount under Section 67 of FA, 1994 for the purpose of levy of Service Tax - Assessee had recovered actual turn over charges / transaction fee from their customers and paid the same to the respective Stock Exchanges as per SEBI Regulations and they did not retain any amount on account of such charges with them - With regard to includibility of turn over charges / transaction fee in the gross value for the purpose of payment of Service Tax, the issue is no more res-integra in view of decision of Tribunal in case of LSE Securities Ltd. 2012-TIOL-593-CESTAT-DEL wherein it has been held that turn over charges cannot be included in assessable value for the purpose of taxation inasmuch as the same are recovered from investors to make payment as per SEBI guide lines - While interpreting the phrase "for such service" used in Section 67 of the Act, the Supreme Court, in case of Intercontinental Consultants & Technocrats Pvt. Ltd. - 2018-TIOL-76-SC-ST have held that said phrase to be strictly construed, to include only the amount of consideration paid for providing taxable service and all expenses to be excluded for consideration of gross value - No merit found in impugned order, same is set aside: CESTAT - Appeal allowed : DELHI CESTAT
CENTRAL EXCISE
2018-TIOL-2008-CESTAT-MUM + Case Story
Exide Industries Ltd Vs CCE
CX - Rule 2(l) of CCR, 2004 - GTA service used for transporting old/used battery from collection center to recycler for obtaining lead and which in turn is used to manufacture fresh battery is towards inward transportation and an Input service - CENVAT credit is admissible - impugned order set aside and appeal allowed: CESTAT [para 4] - Appeal allowed
: MUMBAI CESTAT 2018-TIOL-1997-CESTAT-MUM
Larsen And Toubro Ltd Vs CCE
CX - CENVAT - Appellants had engaged the services of M/s Hilon Ind Tax Consultants for compliance with prescription in Finance Act, 1994 and Service Tax Rules, 1994 - credit denied of the tax paid on these services on the ground that the same had no relation to manufacture.
Held: Appellants are also in the business of providing ‘Erection, Commissioning and Installation services' and have utilized the service provider for ensuring compliance with all legal requirements in the process of rendering such service - possibility that the credit could be used to pay duty on manufacturing goods cannot circumscribe eligibility - denial of credit is not in conformity with law - impugned order set aside and appeal allowed: CESTAT [para 4] - Appeal allowed : MUMBAI CESTAT
2018-TIOL-1996-CESTAT-MAD
India Cements Ltd Vs CCE & ST
CX - Assessee is a manufacturer of cement - It appeared that assessee have availed Cenvat credit on input and input services used for generation of electricity in their Captive Power Plant (CPP) without adhering to the provisions of Rule 6 of CCR, 2004 in respect of excess quantum of electricity wheeled out to TANGEDCO - Department took the view that assessee should have maintained separate accounts for receipts, consumption and inventory for production of electricity which is used within the factory, ie., for captive use and for production of electricity wheeled out to TANGEDCO, hence they are liable to pay 6% of value of exempted goods wheeled out of factory in terms of Rule 6 (3) (i) of CCR - It has been conceded that portion of power electricity/power generated was wheeled out to TANGEDCO under an agreement - Assessee has conceded that they had wheeled out electrical energy to TANGEDCO adjusting against the other units of assessee at Shankari, Salem district, Dalavoi, Perambalur district and Chennai from 26.09.2012 - There was thus adjustment between assessee and TANGETCO in respect of electricity wheeled out by them and thereafter supplied by them to sister units - It is definitely not the assessee's case that electricity wheeled out was supplied free or without any adjustment towards cost of goods of units wheeled out - In this scenario, the ratio laid down by Apex Court in case of Maruti 2009-TIOL-94-SC-CX will be applicable on all force to the facts of present appeal - The contention of assessee that there was no sale of electricity to third party is therefore not acceptable - In a recent judgment of Punjab and Haryana High Court in Maruti Suzuki India Ltd. 2017-TIOL-2182-HC-P&H-CX, it was held that electricity that was wheeled out to third parties was not used in manufacture of final products, therefore LNG to the extent used for production of electricity wheeled out was not input of service of "inward transportation thereby was not input service" - No infirmity found in decision of adjudicating authority that assessee is liable to pay an amount being the amount equal to 6% of value of electricity not used within the factory of production along with interest at appropriate rates thereof - However, on the imposition of penalty, aspect of eligibility or otherwise of inputs used in generation of electricity wheeled out to vendors was mired in litigation for quit sometime - On this very issue, Supreme Court in their judgment in Maruti Suzuki Ltd. 2009-TIOL-94-SC-CX waived the penalty - Ingredients attracting imposition of penalty equal to tax demanded under Rule 15 (1) of CCR are not attracted - This being so, equal penalty imposed under Rule 15(1) set aside: CESTAT - Appeal partly allowed : CHENNAI CESTAT
CUSTOMS
2018-TIOL-1995-CESTAT-AHM
Act Forwarders Vs CC
Cus - There was an attempt to export 419 logs of Red Sander Woods which were seized by Customs - Appellants have been penalized under Section 114(i) of Customs Act, 1962 for their alleged role in aiding and abetting of attempt to illegal export of Red Sanders Wood - Observation and finding of Commissioner has not been rebutted by Sh. Dev Kumar Kapta by evidences except repeatedly harping on the fact that he has been authorized by CHA in carrying out the activities in Dock Area and filing the documents - No reason found to interfere with observation of Commissioner in absence of cogent rebuttal evidences nullifying the said finding of Commissioner - Thus, Sh. Dev Kumar Kapta has actively involved in the attempt to illegal export of Red Sander Woods - As far as CHA M/s Act Forwarders is concerned, Commissioner observed that they had authorized Sh. Dev Kumar Kapta for operating on behalf of them in the Dock Area and handling documents which also they denied - No justification found in penalizing them under Sec.114(i) of CA, 1962 in view of series of judgments of Tribunal and courts including in case of I. Sahaya Edin Prabhu 2015-TIOL-212-HC-MAD-CUS , Swaroop Shipping Services 2008-TIOL-1358-CESTAT-MAD and Neptune Cargo Movers Pvt. Ltd. 2007-TIOL-1101-CESTAT-MAD where under it has been consistently held that for the act of negligence on the part of CHA, penalty cannot be imposed under 114(i) of Customs Act, 1962, as proceedings could be initiated under the CHALR, 2004 - Penalty u/s 114(i) cannot be sustained.
Regarding the penalty imposed on M/s Raghuvir Singh & Sons, Commissioner could not lead to the conclusion that merely authorizing M/s Chirag Enterprises to undertake the transportation from CWC-CFS-Gandhidham to the Port area, it was within the knowledge of assessee that the Roofing Tiles would be replaced with Red Sander Woods by Proprietor of M/s Chirag Enterprises, Sh. Dev Kumar Kapta at Jamadar Wadi - In these circumstances, penalty on M/s Raghuvir Singh & Sons under Sec.114(i) of Customs Act, 1962 also not sustainable: CESTAT - Appeal partly allowed : AHMEDABAD CESTAT
2018-TIOL-1994-CESTAT-CHD
SM Steel Traders Vs CC
Cus - Following difference of opinion was referred to the third Member viz. Whether in view of high sea purchase and declaration in bills of entry, redemption fine and penalty should be reduced to 10% of the fine and penalties imposed by original authority or whether they do not require any interference in view of the admitted abetment by the importer and excess goods/gross mis-declaration of 85% detected.
Held: Although filing of IGM is not with the importer, in view of the acceptance by importer that on their behest the IGM was manipulated, third Member on reference agreed with opinion of Member (J) - inasmuch as in view of the fact that the appellant was a high sea purchaser through a foreign supplier and had made correct declaration in the bills of entry filed, redemption fine and penalty reduced to 10% of that imposed by adjudicating authority - appeals disposed of: CESTAT by Majority [para 16, 18] - Appeals disposed of : CHANDIGARH CESTAT
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