2018-TIOL-2417-CESTAT-MUM

ST - Whether credit of service tax paid on commercial or industrial construction service or works contract is admissible for payment of service tax on output service i.e. renting of immovable property service as building constructed was rented out to various parties - The assessee have availed cenvat credit in respect of commercial and industrial construction services and works contracts service which was used in construction of commercial building which has been rented out by assessee to various parties on which they have already discharged service tax - This issue is no longer res integra as in case of Sai Samhita Storages P. Ltd. decided by Andhra Pradesh High Court, the credit on construction service of a building where the output service is renting of immovable property service, has been held admissible - In the identical issue of earlier period in assessee's own case 2016-TIOL-1571-CESTAT-MUM , Tribunal has decided in their favour - In view of said judgment in assessee's own case and the judgment in case of Sai Samhita Storages , the issue stands settled in assessee's favour: CESTAT

- Appeal allowed: MUMBAI CESTAT

2018-TIOL-2416-CESTAT-MAD

ST - Assessee had filed an intimation seeking adjournment dt.22.11.2016 - The appeal was taken up for hearing on 29.11.2016 and ex-parte order was passed - It appears that the intimation was not placed before the Bench - The O-I-O reflects that disputed amount of service tax has been paid by assessee much before the issuance of SCN and the same has been appropriated by adjudicating authority - This being so, there is an error apparent on the face of record which needs to be rectified - Since the appeal is of year 2016 and the Single Member Bench of Tribunal is now hearing appeals of year 2017 - Since for the period involved 2010-11 and 2011-12 the assessee having paid the service tax before the issue of SCN, applying the ratio laid in case of Serene Developers as well as the judgement of High Court in case of Adecco Flexione Workforce Solutions Ltd 2011-TIOL-635-HC-KAR-ST which has categorically held that no penalties ought to imposed when the service tax is paid before issuance of SCN, penalties imposed are unwarranted - The penalties imposed under section 78 are set aside - Assessee is not contesting the penalty imposed under section 77 - In the result impugned order is modified to the extent of setting aside the penalty imposed under section 78 without disturbing the confirmation of service tax and interest thereon or the penalty imposed under section 77: CESTAT

- Appeals partly allowed: CHENNAI CHENNAI CESTAT

2018-TIOL-2415-CESTAT-BANG

ST - During audit of records of assessee, it was noticed that the service charges collected / received as net income as per Profit & Loss Account were higher than that shown in ST3 returns filed by assessee - On enquiry, assessee submitted that there were instances where reimbursable expenses collected from customers were higher than the expenses actually incurred by them and the differential amount was accounted by them as service charges, though no service tax was paid on this amount - The allegation against them is that as per Rule 5 of STR, 2006, the assessee was required to maintain separate records for service tax - Assessee submitted that adjudicating authority has ignored the instruction issued vide F.No.B43/1/97-TRU dt. 06/06/1997 by the Ministry of Finance, which is directly applicable in their case - The Issue is no more res integra and has been settled in favour of assessee by Apex Court in case of Intercontinental Consultants and Technocrats Pvt. Ltd. - 2018-TIOL-76-SC-ST - I mpugned order is not sustainable in law and therefore the same is set aside: CESTAT

- Appeal allowed: BANGALORE CESTAT

CENTRAL EXCISE

2018-TIOL-317-SC-CX

KLJ Plasticizers Ltd Vs CCE & ST

CX - The assessee company is engaged in manufacture of Phthalate Plasticizers in liquid form - It availed Cenvat credit on inputs - The assessee had intermediate advance licences it removed goods against Advance Release Order by issuing ARE-3s - Clearing of goods without payment of duty requires an assessee to strictly follow the conditions laid down in Notfn under which benefit of duty exemption is being claimed - Presently, the assessee failed to fulfil condition No.(ii) of Notfn 44/2001-CE(N.T.) , upon failing to comply with provisions of Rule 3(7)and Rule 4(1) of CER, 2001 - Duty demand was raised with interest - Penalty was imposed under Rule 25 of CER 2002 - Later, the Tribunal held that the assessee had no choice but to follow the conditions laid down - Failure to do so invite consequences - Such view is fermented by the Apex Court's decision in Ginni Filaments Ltd - Hence duty demand with interest is upheld for not following condition of Notfn No 44/2001-CE(N.T.) - Quantum of penalty was reduced.

Held - Delay condoned - Appeal admitted: Supreme Court

- Appeal admitted: SUPREME COURT OF INDIA

CUSTOMS

2018-TIOL-2414-CESTAT-KOL

KT Pyrochem Vs CC

Cus - The assessee imported goods like LDPE Granules Off Grade at the declared assessable value - The item was of non-standard grade (off grade) - On re-assessment, as per the Customs Valuation (Determination of Value of Imported Goods) Rules,2007 the value was enhanced in order-in-original - The Revenue took a view that CHA inspected the samples & found that the subject goods were nothing but plastic scrap - Duty demand was raised - The Revenue declined the permission to the re- export the consignment purported to be wrongly sent to them by the supplier - Held - In absence of test report from the concerned authority regarding nature of the materials to be scrap, the imported consignments were declared to be other than waste and scrap of plastic - However, according to the Revenue, the samples were not sent for chemical testing for ascertaining the nature of imported consignments being plastic scrap, which is mandatory as per (vii) to Para 27 (2) of the Handbook of Procedures (Vol.1), 1992-97 (Revised Edition : March, 1996) - Hence, the order challenged is set aside: CESTAT (Para 2, 7, 8, 9)

- Appeal Allowed: KOLKATA CESTAT