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2018-TIOL-NEWS-162 - Part II | Wednesday July 11, 2018
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Dear Member,
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TIOL Content Team
TIOL PRIVATE LIMITED.
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DIRECT TAX |
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CIRCULAR
it18cir03
CBDT fixes Rs 1 Crore and Rs 50 lakh monetary limits for filing Departmental Appeals
CASE LAWS
2018-TIOL-254-SC-IT
CIT Vs Bharati Vidyapeeth
Having heard the parties, the Apex Court condoned the delay and dismissed the SLP by stating that the findings of fact of the lower authority would not bind the Revenue in respect of other AYs. - Revenue's SLP dismissed
:SUPREME COURT OF INDIA
2018-TIOL-253-SC-IT
Pr.CIT Vs Haresh D Mehta
Having heard the parties, the Apex Court condoned the delay and dismissed the SLP. - Revenue's SLP dismissed :SUPREME COURT OF INDIA
2018-TIOL-1294-HC-MUM-IT
Pr.CIT Vs Sparkles Dhandho Advisors Pvt Ltd
Whether application seeking condonation of 389 days delay can be allowed if no explanation is provided as to why office objections has not been removed on time - NO : HC - Revenue's application dismissed : BOMBAY HIGH COURT
2018-TIOL-1293-HC-KAR-IT
Pr.CIT Vs Bank Note Paper Mill India Pvt Ltd
Whether appeal u/s 260A, on issues settled by Constitutional Courts, can be filed even though the issue is ex facie and covered under the jurisdiction of High Courts or Supreme Court - NO: HC - Revenue's appeal dismissed : KARNATAKA HIGH COURT
2018-TIOL-1292-HC-KOL-IT
CIT Vs C K Trade Ex Pvt Ltd
Whether revisionary powers exercised u/s 263 are restricted to the extent the matters stood already considered and decided in previous appeals by the CIT(A) - YES: HC - Revenue's appeal dismissed : CALCUTTA HIGH COURT
2018-TIOL-1291-HC-AHM-IT
CIT Vs Mahavir Crimpers
Whether when assessee already provided relevant details explaining source of the loans to lender entity's balance sheet indicating sufficient funds, addition u/s 68 by treating such loan from unexplained source is not justified - YES: HC
Whether crimping of yarn is manufacturing activity for which assessee can claim additional depreciation - YES : HC - Revenue's appeal dismissed : GUJARAT HIGH COURT
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INDIRECT TAX |
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SERVICE TAX
2018-TIOL-2100-CESTAT-DEL
CCE Vs Nanuram Saini
ST- The assessee is engaged in providing service in relation the Man Power Recruitment of Supply Agency - On audit, it was found that the assessee supplied manpower to another entity but did not discharge service tax on the same - Duty demand was raised however, it was confirmed through different Orders-in-Original - On appeal, the Commr. (A) allowed the appeals of assessee and set aside the orders - Hence, the present appeal by Revenue.
Held - The terms of the agreement and purchase orders issued by assessee's service recipient reveals that the work was done on lump-sum basis - Following the ratio laid down by the Tribunal and affirmed by SC in the case of A.P. Vs. Kone Elevators (India) Ltd, it is held that lump-sum work would not fall under the category of providing of service of supply of manpower - Hence, the order challenged is upheld : CESTAT (Para 1, 7, 8, 9) - Revenue's appeal dismissed : DELHI CESTAT
2018-TIOL-2099-CESTAT-BANG
MGF Motors Ltd Vs CCE, C & ST
ST- The assessee dealers for selling and servicing of motor cars manufactured by Hyundai - The manufacturer is providing three free service to the customers who purchase new motor cars from the authorized dealers - For free services or repairs the assessee is not allowed to charge from customers instead they are reimbursed by Hyundai - The profit of assessee was inclusive of all payments - A SCN was issued on grounds that the reimbursement received by the authorized service stations from manufacturer for carrying out any free service of any motor vehicles are includable in the assessable value - The Revenue relied on clause 4.4 of the agreement - Duty demand was raised - On appeal, the Commr.(A) upheld the order-in-original and imposed penalties.
Held - The clause relied does not pertain to free service done under warranty services - Free warranty is provided in terms of clause 7.3 of the agreement - Therefore, repairs covered under warranty are reimbursable - No service tax is liable on free services provided by asessee during warranty period - Following the ratio laid down in the case of CCE, Indore vs. Jabalpur Motors Ltd , CCE, Nashik vs. Automotive Manufacturers Ltd , ASL Motors Pvt. Ltd. vs. CCE & ST, Patna & Indus Motor Company vs. CCE, Cochin - Hence, the order challenged is set aside : CESTAT (Para 2, 6, 7) - Appeal allowed : BANGALORE CESTAT
2018-TIOL-2098-CESTAT-AHM
L and T Technology Services Ltd Vs CGST & CE
ST - Assessee had filed refund claim of service tax paid by them to various service providers on the services required for authorized operation of their SEZ Unit in terms of Notfn 12/2013-ST - Out of the total amount of Rs. 45,76,437/-, an amount of Rs. 41,75,011/- has been rejected on the ground of limitation and the remaining amount was rejected on merit which is not disputed in the present appeal - Even though in the letter dated 31.05.2017, the assessee had requested to condone the delay in filing the refund claim relating to invoices Sr. No. 1 to 93 but the reason or cause for such delay has not been mentioned in said letter/application - In absence of proper reasons explaining the delay, same cannot be considered - However, in the interest of justice, matter is remanded to the Adjudicating Authority, at the request of assessee to give a reasonable opportunity to them in explaining the delay in filing the refund claim: CESTAT - Matter remanded : AHMEDABAD CESTAT
CENTRAL EXCISE
CX - Assessee during the relevant period i.e. April 2006 to August 2006 received raw materials, namely Spent Acid and availed credit on said input - Alleging that said raw material does not fall under definition of 'inputs' prescribed under Rule 2(k) of CCR, 2004, therefore, credit is inadmissible to them, accordingly, SCN was issued for recovery of said credit with interest and penalty - Undisputedly, assessee had received the Spent Acid in their factory premises and used in or in relation to manufacture of finished products - The authorities below observed that since Spent Acid broadly refers to 'Spent Sulphuric Acid', it must not have been used in or in relation to manufacture of finished product by the manufacturer, and consequently confirmed the demand - Assessee submits that the description of input in respective input invoices, by the input supplier as "Bulk Drug/ Spent Acid", was a mistake which later got clarified by issuing necessary Certificate by said input suppliers - In support, Certificates have been enclosed with appeal paper book - It is found from the flow chart that Phosphoric Acid has been mixed with Castic Soda and Soda Lime in getting the finished product - Therefore, there cannot be any doubt in use of Spent Poly Phosphoric Acid in their factory premises in manufacture of finished goods - Thus, the description of raw material though shown in respective invoices as Spent Acid, but it is not Spent Sulphuric Acid as is evident from Certificate issued by respective input suppliers - In the result, impugned order is set aside: CESTAT - Appeal allowed : AHMEDABAD CESTAT
CX - Assessee is in appeal against impugned order denying cenvat credit on port Services, Gerneral Insurance Business Service, Commercial/Industrial Construction Service, Renta- cab service and works contract service - As regards to Port Services, impugned period is 2011-2012 to 2012-2013 and the SCN has been issued to assessee on 31.08.2014, which is issued by invoking extended period of limitation - Admittedly, availment of cenvat credit has been shown by assessee in their regular ER-1 returns and there is no separate column for segregating the cenvat credit availed by them service vice - In that circumstance, relying on decision of Tribunal in case of Medicaps Limited 2011-TIOL-1993-CESTAT-DEL , extended period of limitation is not invokable, therefore, demand in respect of port service is set aside - As regards to General Insurance Business Service, said service has been availed by assessee for transportation of goods from their factory gate to port of export and in case of export, the port of export is the place of removal, therefore, in terms of the decision of Tribunal in case of Gobind Sugar Mills , assessee is entitled to avail cenvat credit - For remaining services, assessee has already reversed the cenvat credit, therefore, the same is not considered by Tribunal at this stage for denial or availment of cenvat credit - No penalty is imposable on assessee: CESTAT - Appeal allowed : CHANDIGARH CESTAT
CUSTOMS
NOTIFICATION
cnt61_2018
Village Varnama, Taluka District Vadodara notified as Inland Container Depot
CASE LAWS
Cus - Assessee filed Bill of Entry for import of one unit of second hand used Mitsubishi Pajero Vehicle under Transfer of Residence facility in terms of Public Notice 3/97-02 - Car was not released to assessee as the investigation was taken up by SIIB - Investigations with Mitsubishi Motors revealed that the vehicle was manufactured in July 1993 and the selling price was Japanese Yen 3.6 million and the date of export is not known but that the export might have been made by third party in 1993 - On further investigation of the car, a sticker was found on the windshield in Japanese which showed that the date of maintenance and repair to be 21.8.97 at Tokyo Sales Office of Mitsubishi Motors - The car was seized under Mahazar - On the basis of such investigation, a SCN was issued to assessee alleging that assessee was a name lender and not entitled to import in terms of Public Notice under Transfer of Residence as the car was not in his possession for one year prior to import and that the documents produced along with Bill of Entry are not reliable - On perusal of final order of Tribunal, it is found that the Tribunal had given directions to grant 70% depreciation on value of the car while determining its assessable value - Since that Tribunal order has not been stayed or set aside by a higher appellate forum, the order became final for all purposes and Commissioner (A) was bound to comply the directions therein in toto - However, in impugned order, Commissioner (A) has granted only 52% depreciation which is not in consonance with the directions of Tribunal - Therefore 70% depreciation has to be allowed on the value of vehicle - Considering that assessee has furnished all the necessary documents along with Bill of Entry and also these documents are government documents, redemption fine reduced to Rs.50,000/- and the penalty to Rs.25,000/- : CESTAT - Appeal partly allowed : CHENNAI CESTAT
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GST CASE |
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