CGST & CE Vs Ticel Bio Park Ltd

ST- The assessee is rendering renting of immovable property services - On audit, it was noticed that they did not pay service tax on the electricity charges and air-conditioning charges for the period in dispute - In addition, service tax has not been paid on maintenance charges collected by the assessee - Demand for differential amount of duty was raised and penalty was imposed u/s 78 with option to pay reduced penalty - However, the Commr. (A) deleted the demand with interest as well as penalty - Hence the present appeal.

Held - Air-conditioning and electricity charges are reimbursable expenses which cannot be included in the total value of taxable services - Following the decision of M/s. Plaza Maintenance and Services Ltd, Final Order No. 41806 & 41807/2017 the order challenged is upheld - With respect to operation & maintenance charges the amount collected as operation and maintenance charges represents charges for maintenance of the building rented out to the clients - Therefore, the case is remanded for this particular issue whether they were providing any maintenance services prior to 1.6.2007 and whether these will fall under MMR services has to be looked into - The matter is remanded even for the issue of limitation - Hence, the appeal is partly allowed: CESTAT (Para 1, 5, 6) - Matter remanded: CHENNAI CESTAT

S Chandran Vs CCE

ST - The assessee an individual, rendered 'Commercial or Industrial Construction Service' to BSNL - It was noticed that the assessee did not discharge service tax for the period 2006-07 & 2007-08 - The original authority confirmed the demand and imposed penlaty under section 77 of FA Act - The Commr. (A) upheld the demand - It was highlighted that the issue whether construction activity undertaken was leviable to service tax was an interpretational issue.

Held - The assessee was providing construction services it is held that indivisible works contract is not subject to levy of service tax prior to 1.6.2007 - Following the decision of Larsen & Toubro Ltd. the demand is set aside - Hence, appeal is partly allowed : CESTAT (Para 1, 6, 7, 8, 9) - Appeal partly allowed: CHENNAI CESTAT

CENTRAL EXCISE

Bloom Dekor Ltd Vs CCE

CX - Assessee is engaged in manufacture and clearance of goods on payment of excise duty - Revenue argued that they were clearing goods to their depots and issue SCN demanding excise duty invoking Rule 7 of CEVR, 2000 - Assessee have not produced any evidence whatsoever to support their assertion that they were selling the goods from the factory gate - From the assertion made by assessee before original adjudicating authority and Commissioner (A), it is apparent that they have admitted that the goods were sold through consignment agent - The definition of place of removal clause (iii) specifically covers premises of consignment agent as the place of removal - Rule 7 of Rules, 2000 lays down the manner in which assessment needs to be done in these circumstances - Since the sole defence of assessee that the goods were not sold at the factory gate is unsubstantiated and was never raised before the original adjudicating authority or before the first appellate authority, the same cannot be allowed to be raised at this stage especially when it is seen from the replies made by assessee before the lower authorities that they had admitted the goods were sold from the premises of consignment agent - No infirmity found in the manner in which the value has been arrived at by lower authorities - In so far as invocation of extended period of limitation is concerned, it is the duty of assessee to clearly disclose that no sale is made from the factory but all the sales are made from the premises of consignment agent - In view of clear provisions of law, defence of assessee fails and extended period has been rightly invoked: CESTAT - Appeal dismissed: AHMEDABAD CESTAT

Ashik Woolen Mills Ltd Vs CCE & ST

CX - Assessee is engaged in manufacture of Woolen Yarn, Woolen Viscose Yarn and Polyester Viscose Yarn - The first grievance of assessee is related to excess quantity found during search - Assessee submits that goods were unfinished, unpacked and were at the factory floor - Tribunal in case of Ambey Laboratories 2017-TIOL-2984-CESTAT-DEL observed that since the goods remained within factory there is no justification for seizure and confiscation of such goods - By following the ratio laid down in said case, redemption fine is set aside.

The next grievance of assessee is pertaining to duty demand of Rs. 40,32,222/- - Assessee is a job worker and primary duty payment liability lies with the job worker unless the principal manufacturer had taken over the liability - In the present case, principal had not taken over the liability, so the assessee is liable to pay the duty liability of Rs. 40,32,222/-.

Next grievance of assessee is pertaining to duty demand of Rs. 2,83,421/- on the ground of goods sent for job worker - Since the principal has not taken the liability to pay the duty demand so the duty demand lies with the job worker - Hence, the duty demand of Rs. 2,83,421/- is deleted.

As regards to the demand of Rs. 5,47,536/- it appears that demand was raised solely on the basis of statement of Sh. R. B. Shah, Authorized Signatory who, in his statement admitted that file No. 22 contained various challans showing dispatch of finished goods and that no Central Excise invoices were for such dispatches made by them and that the said goods were removed by them without payment of Central Excise duty - When it is so, then no reason found to interfere with impugned order, especially when no contradictory facts/ evidecne has been brought to the notice of Bench - Hence, this demand is hereby sustained.

Similarly, another grievance is for Rs. 2,14,853/- - Goods were removed from the factory without payment of duty through the gate passes - When it is so, then said demand is also confirmed.

The last grievance of assessee is pertaining to demand of Rs. 3,18,290/- raised for the shortage of yarn - It appears that no worksheet showing how shortage was arrived, was made by the Investigating Officers - No shortage was worked out by the department - In other words, the demand is based merely on assumption basis - When it is so, then the demand is not sustainable.

The penalties will be decided accordingly by the Adjudicating Authority in light of confirmation of duty: CESTAT - Appeals partly allowed: AHMEDABAD CESTAT

Chemplast Sanmar Ltd Vs CGST & CE

CX - Assessee is engaged in manufacture of Caustic Soda Lye and Ethylene-di-Chloride - For import and receipt of ethylene through sea, they have put up a jetty in Karaikal Port along with all connected facilities - They have availed credit on these items as capital goods under CCR, 2004 - Revenue objected the same on the ground that these are located in unregistered premises and further they have no direct role in manufacturing process of excisable final products - Similar dispute came before Bombay High Court in case of Reliance Industries Ltd. 2017-TIOL-1630-HC-MUM-CX wherein the High Court after extensively analyzing various decided case laws including the decision of Supreme Court in Jawahar Mills Ltd. 2002-TIOL-87-SC-CX and Jayaswal Neco Ltd. 2015-TIOL-70-SC-CX held that single point mooring system along with connected equipment like anchor chain, piles on pipes, offshore services are eligible for credit as capital goods as these are connected to the receipt of raw materials essential for manufacturing process - In the said dispute also, the single point mooring system was installed for discharge and transport of liquid cargo used as a raw material - Tribunal in Finolex Industries Ltd. 2003-TIOL-226-CESTAT-MUM examined a similar dispute and held that the jetty put up by assessee was part of the premises and the same should be considered as falling within the scope of section 2(e)"factory" as defined under CEA, 1944 - Denial of credit is not legally sustainable: CESTAT - Appeal allowed: CHENNAI CESTAT

CUSTOMS

2018-TIOL-2190-CESTAT-MAD

Big Bags International Pvt Ltd Vs CC

CUS - The assessee exported flexible intermediate bulk container bags & claimed duty drawback under All Industry Rate - The assessee procured the export goods from other manufacturers, on payment of duty - The manufacturers availed Cenvat credit and using the same paid duty on the goods sold to the assessee - Such goods in turn were exported by the assessee under claim for drawback under AIR - The Revenue opined that since the manufacturer availed Cenvat credit for payment of duty while selling the goods to the assessee who exported them, the assessee will be entitled to the AIR at the rate which was allowable to the export goods without availing Cenvat credit - A SCN was issued & the Order-in-Appeal was passed for recovery of part of the drawback paid to the assessee - Hence, the present appeal by assessee.

Held - The issue at hand is with regard to the drawback which is allowable under the AIR for FIBCs exported by the assessee - CBEC Circular No. 16/2009-Cus , provides a clarification w.r.t. the payment of drawback in respect of the goods which are purchased by merchant exporters from traders in the local market - There is a presumption that the goods available in the market are deemed to be duty paid - However, in the present case, it is evident that the assessee has not procured the export goods from any trader in the market but directly from the manufacturer who has paid the CE duty on such goods by availing Cenvat credit - Further, in Notification No. 103/2008-Cus the words "Cenvat credit has not been availed" have been explained to mean that no Cenvat facility has been availed for any of the inputs or input services used in the manufacture of the export products - This is in relation to the manufacture of the goods which - In the instant case, it is clear that the manufacturer has availed the benefit of Cenvat credit - Therefore, the assessee will not be entitled to the excise portion of AIR - Hence, the order challenged is upheld : CESTAT (Para 2, 7, 8, 9) - Appeal rejected: CHENNAI CESTAT