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SERVICE TAX
2018-TIOL-2479-CESTAT-MAD
CST Vs Ideal Play Abacus India Pvt Ltd
ST - Assessee is engaged in business of imparting training to young children using the tool 'Abacus' - The techniques and rights of training were obtained by assessee from Play Abacus, SDN BHD, Malaysia under a franchise agreement - It appeared that assessee have not discharged service tax in respect of 'Commercial Training or Coaching Service' as well as franchisee service and SCN was issued proposing to demand service tax along with interest and for imposing penalty - The issue whether the said course conducted by assessee falls within the definition of 'Commercial Training or Coaching Service' is decided by Tribunal in Abacus Brain Study (P) Ltd. 2011-TIOL-1021-CESTAT-BANG - Following the same, impugned order requires no interference: CESTAT
- Appeal dismissed: CHENNAI CESTAT
2018-TIOL-2478-CESTAT-MAD
V Chinnasamy Vs CCE
ST - The assessee's undertook various construction works mainly for customers like BSNL, LIC, All India Radio and Works of erection of cell phone towers for BSNL - The department took a view that assessee were liable to pay service tax under "Commercial or Industrial Construction Service" upto the period 31.5.2007 and under Works Contract Services - Furthermore, there was non payment of service tax on cleaning services - Duty demand was raised and confirmed by the lower authorities alongwith interest and penalties - Hence, the present appeal.
Held - In the present case, the disputed period is October, 2004 till March, 2009 - In addition, the contracts are composite in nature, therefore, in view of the ratio laid down by Supreme Court in the case of Larsen & Toubro 2015 (39) STR 913 (S.C.) the demand of sservice tax prior to 1.06.2007 is not valid - As regards demand under WCS, the assessee undertook construction works for PSU's and Government agencies, also, it was under the impression that service tax is not payable by such agencies - The Revenue has not been able to produce substantive evidence to prove that assessee suppressed facts with intent to evade payment of tax- The SCN has been issued by invoking extended period of limitation - Therefore, the demand invoking extended period would not sustain - However, the assessee is liable to pay service tax for normal period but penalty is deleted - The demand for cleaning services is set aside - Hence, in the order-in-appeal the demand after 1/6/2007 is set aside on limitation, demand for normal period & on cleaning services is confirmed: CESTAT (Para 1, 5)
- Appeal partly allowed: CHENNAI CESTAT
CENTRAL EXCISE
2018-TIOL-2477-CESTAT-MUM
CCE & ST Vs Shridhar Castings Pvt Ltd
CX- The Revenue found shortages in the physical stock which led to duty demand - This was confirmed in order-in-original on the basis of quantity of production worked out on the basis of electricity consumption required as per the report of technical expert - On the contrary, in appeal the Commr. (A) upheld the demand on shortage of stock but deleted all other demand and equivalent penalties - Hence, the present appeal by Revenue.
Held - With regard to the issue of quantity of annual production worked out on the basis of electricity consumption - There are numerous decisions of SC, HC & Tribunal holding that merely on electricity consumption, a conclusion cannot be drawn that the assessee has produced the extra production and cleared clandestinely in absence of any other corroborative evidence - Therefore, demand of duty only on basis of electricity consumption cannot be confirmed - Hence, the order challenged is upheld : CESTAT (Para 1, 4, 5)
- Revenue's appeal dismissed: MUMBAI CESTAT
2018-TIOL-2476-CESTAT-KOL
Adhunik Alloys And Power Ltd Vs CCE
CX - Assesssee purchased rails and railway sleepers for laying railway track from Kandra railway siding to the unloading point inside the factory for inward transportation of raw materials and also outward transportation of finished goods - Whether cenvat credit on rails and rail sleeper is available under the category of capital goods or inputs - In case of Aditya Cement, the Rajasthan High Court had held that the railway track along with locomotive used by a cement factory for purpose of transporting its material is a conveyor system and accordingly, the assessee was entitled to benefit of credit - In case of Tata Steel Ltd. 2016-TIOL-881-CESTAT-KOL, the Tribunal, following the decision of Supreme Court in case of Jayaswal Neco Ltd. held that use of railway tracks is related to actual production of goods and without the use of said railway track, commercial production would be inexpedient - Impugned goods have been used for laying of railway line for transportation of inputs inside the factory for manufacture of final products - Therefore, impugned goods seem to have nexus with the manufacture of final goods and are covered under definition of inputs as per Cenvat Credit Rules - Thus, the impugned order is set aside: CESTAT
- Appeal allowed: KOLKATA CESTAT
2018-TIOL-2475-CESTAT-ALL
Ajay Kumar Gupta Partner Vs CCE
CX - Assessee is manufacturer of plastic parts for automobile batteries and inverter batteries - Their unit was visited by officers of Central Excise wherein some records and documents were resumed by officers during the said visit - Further the officers also conducted enquiries with transporters and recorded statements of various persons - On the basis of statements of transporters and other investigations, the assessee was issued SCN wherein there were allegations that inputs were not received by assessee and they had availed Cenvat Credit on such inputs which were not received by assessee - It is very clear that the basis of SCN is various statements recorded - High Courts have time and again emphasized that the relevancy of statement is required to be established by first examining the prosecution witness by adjudicating authority in 'examination in chief' and then make up its mind to decide about the relevancy of statement and subsequently allow the cross-examination of prosecution witness and after cross-examination accept the original statement if it sustains through cross-examination as a piece of evidence - Since such a process was not carried out, matter remanded to original authority with a direction to allow cross-examination of all prosecution witnesses by assessee and further direct that the statement of such persons whose cross-examination could not be conducted should not be relied upon to arrive at any conclusion: CESTAT
- Matter remanded: ALLAHABAD CESTAT
CUSTOMS
NOTIFICATION/ CIRCULAR
cuscir26-2018
Simplification and rationalization of processing of AEO-T1 application - reg
dgft18pn029
Provision for HS Code 63029100 under MEIS incentives for the period 01.04.2015 to 30.09.2015
CASE LAW
2018-TIOL-2474-CESTAT-ALL
CC, CE & ST Vs Manikya Creations Pvt Ltd
Cus - the assessee imported 'Chalk-Natural Calcium Carbonate' from Vietnam & sold the same in India - The assessee also claimed to have imported Natural Ground Calcium Carbonate which is classified under Chapter 25 of the Customs Tariff Calcite (25309030) & Chalk (25090000) - Although some samples were taken by the CRCL, New Delhi, they were sent back on grounds that it did not have the requisite facilities & equipment to conduct tests on Natural Calcium Carbonate - Hence the samples were returned to the Customs authorities - When the samples were sent to the Indian Bureau of Mines, they too expressed similar disability to conduct test - Later the samples were sent to an NABL-accredited laboratory, which identified the Chalk Powder sample as Natural Uncoated Ground Calcium Carbonate - The ICD again sent such samples to the CRCL which again turned down the request for want of equipment - Thereafter, the CRCL got the samples tested by a chemical examiner, who declared the goods as 'Uncoated Precipitated Calcium Carbonate' - Through a subsequent RTI application, the assessee came to know of such reports - It also approached the Customs authorities seeking re-testing of the samples - However, such requests were denied on grounds that an importer could not choose the testing facility - Subsequently on appeal, the Tribunal held that the samples be sent to some laboratory other than the CRCL - The assessee paid the differential duty arising from such classification - However, the assessee claimed that despite the same, the ICD took no action to send the samples to another laboratory - On appeal, the Commr.(A) directed that the samples be sent for testing to some other laboratory - Hence the Revenue's appeal claiming that the CRCL is competent enough to conduct such testing.
Held - The assessee relied on Customs Circular No. 43/2017 which lists the samples which cannot be tested at CRCL labs - Such list includes Natural Calcite Powder - This demolishes the Revenue's case & so the appeal merits being rejected: CESTAT (Para 1,3,4,6)
- Appeal dismissed: ALLAHABAD CESTAT
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