SERVICE TAX
2018-TIOL-2260-CESTAT-MUM + Case Story
Spm Autocomp Systems Pvt Ltd Vs CCE & ST
ST - Once the appellant's act of recovering consideration from its employees for providing canteen services falls under the definition of the term 'Service', then there is no ground to deny the exemption that has been given in respect of the said taxable service by amending notification 14/2013-ST - findings of Commissioner(A) that the said exemption(s) are in a different context and thus have no relevance with the present case; that the said activity also fails to find a place in the 'negative list' cannot be appreciated - no cogent or even an iota of reason is forthcoming for not allowing the benefit of exemption notification 25/2012-ST as amended by notification 14/2013-ST - Appeal is allowed with consequential relief: CESTAT [para 7, 8] - Appeal allowed
: MUMBAI CESTAT
2018-TIOL-2250-CESTAT-BANG
NXP Semiconductors India Pvt Ltd Vs Commissioner of Central Tax
ST- The assessee is engaged in the export of "Information Technology Software Services, Business Auxiliary Services, Consulting Engineering Services" - It filed refund claim of unutilised Cenvat credit on various input services used for services exported by them during the period in dispute under Rule 5 of CCR 2004 read with Notification No.27/2012-CE - However, the lower authorities allowed few of the claims and denied the rest - Hence, the present appeal by assessee.
Held - As per Rule 6A of Service Tax Rules, 1994 three conditions are prescribed on fulfilment of which a service provider is eligible to export without payment of service tax when the service recipient is located outside India, place of provision of service is outside India and finally, consideration for the services rendered must be received in convertible foreign exchange - In the present case all three conditions are fulfilled - The services rendered by the assessee under the category of BAS is Export of Service and therefore, the assessee are entitled to refund of Cenvat credit - The original authority has not applied the formula in a correct manner on account of which the refund amount has been substantially reduced - Further, for the subsequent period, the original authority has correctly applied the formula to determine the eligibility of refund and those orders are on record produced by the assessee - In addition, the assessee have annexed detailed chart for computation of eligible refund for different quarters along with the appeal - The original authority will reconsider and apply the correct formula for the purpose of determining the refund claim of the assessee - Hence, the order challenged is set aside : CESTAT (Para 2, 6, 7, 8, 9, 10,11, 12) - Matter remanded: BANGALORE CESTAT
2018-TIOL-2249-CESTAT-MAD
Ford Business Services Centre Pvt Ltd Vs CST
ST - The assessee is engaged in export of services & filed refund claims under Rule 5 of CCR for the unutilized cenvat credit - However, the Revenue partly sanctioned the refund and rejected the balance claim of the assessee - The Commr.(A) allowed the refund claim in respect of some issues - In addition, with respect to credit availed on Event Management Services, Renting of Immovable Property services for car parking and credit availed on debit notes rejection of refund was upheld - Hence, the assessee and Revenue were in cross appeals against O-i-A -
Held - Prior to 1.4.2011 since the services are availed in the course of business of the assessee, the credit is admissible - Following the ratio laid down in the decision of Ultra Tech Cement Ltd. Vs CCE - Thus, credit availed on these two services are eligible and admissible - With regard to credit availed on the debit notes, the issue requires verification in view of Commr. (A) findings - Therefore, the case is remanded for limited purpose of verifying whether the credit availed on these debit notes is proper as to payment of service tax and other details - Hence, the order challenged is modified : CESTAT (Para 3, 5, 6) - Assessee's appeal allowed: CHENNAI CESTAT
2018-TIOL-2248-CESTAT-MAD
DCW Ltd Vs CCE
ST - Assessee is engaged in manufacture of caustic soda, PVC resin and hydrochloric acid - They availed loan from M/s. ICICI, Hong Kong - On the foreign currency borrowing called External Commercial Borrowings, the assessee has to pay upfront fee, management fee and commitment fee - The assessee failed to discharge service tax on such fees paid to the overseas service provider - SCN was issued proposing to demand service tax under Banking and Financial Services - Assessee had paid the entire service tax along with interest on 27.6.2008 - The SCN has been issued by department invoking the extended period on 14.8.2008 - Sub-section (3) of Section 73 provides that no SCN is to be issued when the assessee has paid the service tax as pointed out by the department - Assessee had failed to pay service tax only due to the bonafide belief that M/s. ICICI Hong Kong being a financial institution functioning overseas and belonging to ICICI based in India, and the overseas bank not being of foreign origin, the provision of section 66A are not applicable - That, therefore they are not liable to pay service tax under reverse charge mechanism - However, as the provisions of section 66A(2) of the Act provides that in case of permanent establishment in India and permanent establishment in a country other than India, such permanent establishments should be treated as separate persons for the purpose of said Section - Therefore, on being pointed out, assessee has discharged their service tax liability - Commissioner (A) has rightly set aside the penalties imposed by invoking section 80 of Finance Act: CESTAT - Appeals dismissed: CHENNAI CESTAT
CENTRAL EXCISE
2018-TIOL-2253-CESTAT-MUM + Case Story
Murlidhar Purswani Vs CCE
CX - Recovery - Tribunal, as per the CEA, 1944, is not in a position to adjudicate with regards the dispute between the partners of the Company and the partners in the partnership firm - Since there is no dispute in respect of the adjudged dues, appeals filed by partners are not maintainable: CESTAT [para 5] - Appeals dismissed: MUMBAI CESTAT
2018-TIOL-2252-CESTAT-MUM
JSW Steel (Salav) Ltd Vs CCE
CX - CENVAT - Issue is whether appellant is liable to pay interest u/r 14 in case where the appellant have availed CENVAT credit before making full payment of value, as indicated in the invoice/bill/challan etc. issued by the service provider - appellant in grounds of appeal have submitted that even though a part amount is withheld by the appellant in respect of basic service charges, but the entire amount of service tax charged by the service provider was paid to them, therefore, provision of rule 4(7) of CCR, 2004 is not applicable.
Held: As per the Board Circular 122/03/2010-ST dated 30.04.2010, once the service tax payment was made, the assessee is eligible to avail the credit - therefore, it cannot be said that the credit was taken before it was due - similar issue has been considered in Hindustan Zinc Ltd. - 2016-TIOL-3174-CESTAT-DEL - accordingly, no interest is chargeable - impugned order set aside and appeal allowed: CESTAT [para 4, 5] - Appeal allowed: MUMBAI CESTAT
2018-TIOL-2251-CESTAT-BANG
Kochin Kagaz Ltd Vs CCE, C & ST
CX - Assessee had set up two units for manufacture of kraft paper and both the units are known as Unit-1 and Unit-2 - Both the units were availing concessional rate of duty at 8% up to an aggregate quantity in a financial year in terms of Notfn 6/2002-CE - The Department contended that both the units are not eligible to avail concessional rate of duty separately and a SCN was issued to assessee proposing clubbing the clearances of both units for the purpose of limiting concessional rate of duty to a quantity of 3500 MTs of kraft paper during a year - Case is squarely covered by decision of Supreme Court in Rollatainers Ltd. 2004-TIOL-67-SC-CX and Amaravathi S. V. Paper Mills Ltd. 2010-TIOL-60-SC-CX - It was held in the case of Rollatainers Ltd. that simply because both the factories are in the same premise that does not lead to an inference that both the factories are one and the same - In the present case, though the factories are situated in same premise and managed by same authority, they have separate labour force, electricity connection, license of boilers department, license of the factories department and Central Excise department also - Therefore, going by the ratio of judgments of Supreme Court in said cases, exemption Notfn 6/2002-CE cannot be denied to Units 1 and 2 of assessee as it is established that they are distinct and separate factories - Intention of Notfn was to extend benefit to the paper and paperboard manufactured in a factory and not to the manufacturer as a whole - Both Units 1 and 2 managed by assessee are different factories so as to make them eligible separately for the exemption contained in said Notfn: CESTAT - Appeals allowed: BANGALORE CESTAT
CUSTOMS
2018-TIOL-2247-CESTAT-MAD
CC Vs ICP India Pvt Ltd
Cus - Assessee imported goods described as 'Aluminium Composite Panels' declaring classification under CTH 7606 and claiming concessional rate of duty under Notfn 21/2002 - The department views that the goods are rightly classifiable under CTH 7610 and assessee is not eligible for benefit of notfn - Assessee has produced a sample plate of impugned goods before Tribunal - It is in the form of a sheet and definitely is not a structure, or part of structure falling under 7610 - It cannot be used as structure or part of structure and is only plates that are generally used for cladding the surfaces - These are sheets which are cut and grooved to clad surfaces, walls etc. - They cannot be termed as structures or parts used for construction - Commissioner (A) has rightly classified the same under 7606 - No ground found to interfere in the impugned order: CESTAT - Appeal dismissed: CHENNAI CESTAT
2018-TIOL-2246-CESTAT-AHM
Shree Electromelt Ltd Vs CC
Cus- The assessee imported cooking coal in bulk and filed bills of entry - It claimed exemption under Notification No. 21/2002-Cus - On audit, sample bills of entry were drawn & sent for testing to ascertain whether it is cooking coal or otherwise - Thereafter, the Chemical Examiner reported that the sample is of non-cooking coal - However, the assessee did not accept the test report of the Chemical Examiner & sought re-test to ascertain the parameters - On the contrary, the Revenue took a view that assessee was not eligible to avail benefit of the exemption - This call was taken on the basis of questionable test report & duty demand was raised as well as imported coal was confiscated with an option to redeem the on payment of fine and penalty - Hence, the present appeal.
Held - The chemical test report of Loading port and the Revenue are a mis-match - Once there are contradictions on the test reports it is ordered to re-test the sample - Hence, the order challenged is set aside with a direction to Revenue to consider the eligibility of the notification on the out come of the basis of test to be conducted again : CESTAT (Para 3, 7, 8, 9, 10) - Matter remanded: AHMEDABAD CESTAT
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