SERVICE TAX
2018-TIOL-1790-HC-AHM-ST
IWI Cryogenic Vaporization Systems India Pvt Ltd Vs Commissioner of CGST & Central Excise
ST - The assessee company was served an SCN raising duty demand for unpaid dues, with interest & also imposing penalty - Such levies were confirmed upon adjudication - The assessee's appeal as well as rectification application to the Tribunal was dismissed - When the assessee approached the High Court, the Single bench dismissed the appeal - Hence the assessee filed the present appeal claiming reduction of penalty as per proviso to Section 78 of the Finance Act 1994.
Held - The assessee filed the rectification application about six months after the High Court dismissed its application - While it did give the liberty to approach the Tribunal and file rectification application, it did not mandate that the Tribunal had to entertain such an application or else open an avenue which may otherwise have been closed to the assessee - Also the assessee gave no reasons to explain why its rectification application could be entertained after lapse of six months - Hence the Tribunal committed no infirmity in dismissing the application: HC (Para 2-5,8,9) - Appeal dismissed
:
GUJARAT
HIGH COURT
2018-TIOL-1783-HC-MUM-ST
CST Vs Omega Associates
ST - In view of decision of High Court of Bombay in 2018-TIOL-288-HC-MUM-ST, builders are not liable to pay Service Tax under category of 'Maintenance or Repair services' on 'One-time maintenance charges' collected from flat buyers – Tribunal's order upheld: HC
- Appeal dismissed: BOMBAY HIGH COURT
2018-TIOL-2705-CESTAT-HYD + Case Story
Ruchi Infrastructure Ltd Vs CCE, ST & C
ST - Storage of imported edible oils - Appellant collecting only tank rental charges - not chargeable to tax under Storage and Warehousing services: CESTAT [para 7, 9]
- Appeal allowed
: HYDERABAD CESTAT
2018-TIOL-2698-CESTAT-HYD
Red Fox Hotels Vs CCT
ST - Assessee is a hotel and provides accommodation services to their clients - These services became chargeable to service tax from 1st May, 2011 - The assessable value for charging service tax is composite amount chargeable by assessee from their customers - This includes the charge towards accommodation, complimentary breakfast and meals, Service Tax has to be discharged on the entire amount and no concession is given towards free meals or breakfast provided by assessee - The assessee is entitled to abatement of 50% of value on the total amount under Notfn 1/2006-ST subject to condition that he does not avail CENVAT Credit on input services used in providing the accommodation services - As far as issue of abatement under notfn 1/2006-ST is concerned, there is no dispute that the assessee has not availed CENVAT Credit on any inputs or input services specifically towards provision of accommodation services - They had availed credit on common input services used for accommodation services and other services - This issue is no longer res integra as the matter has been decided by Tribunal in case of Lemon Tree Hotels relying on the judgment of High Court of Gujarat in case of Mundra Ports and SEZ Ltd. 2015-TIOL-1288-HC-AHM-ST - Respectfully, following the same ratio, it is held that the utilization of common input services by assessee does not disentitle them to the benefit of abatement under notfn 1/2006-ST - Thus abatement will be available on the total value of services provided by them, which in their case is the composite amount which they charge towards providing accommodation services from their clients - As far as the laundry services are concerned, it is not in dispute that they were not chargeable to tax during the relevant period - When any SCN is issued, the burden of alleging and proving the allegations in SCN that a taxable service has been rendered is on the revenue and it is not on the assessee to prove otherwise - In this case, the words used were the ‘laundry services’ and there is no evidence or investigation report to show that under the garb of laundry services dry cleaning services were provided by assessee - Therefore, laundry services are not chargeable to service tax: CESTAT
- Appeal allowed: HYDERABAD CESTAT
2018-TIOL-2697-CESTAT-KOL
CCE Vs Hindustan Coca Cola Beverages Pvt Ltd
ST - Assessee was issued a SCN alleging that they have short paid the Service Tax inasmuch as they had wrongly availed the benefit of 75% abatement on the gross taxable value under Notfn 32/2004-ST and Notfn 01/2006-ST - The period of dispute was from April 2006 to September 2006 - It is the allegation of Revenue that assessee failed to produce proper consignment notes containing the declaration stipulated in Board’s Circular which is mandatory for availing the abatement of 75% from the gross taxable value - Assessee has availed services of GTA for transportation of their products to outward destination - Assessee is discharging Service Tax under Reverse Charge Mechanism, being a recipient of service - The assessee has provided declaration as received from GTA issued by them on their Letter Head - The Adjudicating Authority discarded the declarations on the ground that the declaration was obtained on letterhead and not on the body of each consignment note - The declarations filed by GTA on their letter head certifying that they have not availed Cenvat Credit on inputs or capital goods in availing the benefit under Notfn 12/2003-ST, should have been accepted by Department in extending the benefit Notfn 32/2004-ST and 01/2006-ST - No reason found to interfere with the impugned order and same is accordingly sustained: CESTAT
- Appeal dismissed: KOLKATA CESTAT
CENTRAL EXCISE
2018-TIOL-1782-HC-MUM-CX
CST Vs PPD Pharmaceuticals Development India Pvt Ltd
CX - Revenue is aggrieved by common order of Tribunal wherein Revenue's appeal was dismissed by relying upon the decision of this Court in SGS India Pvt. Ltd. 2014-TIOL-580-HC-MUM-ST - Being aggrieved by order of Court in SGS India (P) Ltd. the Revenue filed an appeal to the Supreme Court and notice has been issued - It is submitted that this appeal be admitted and await the decision of Apex Court in case of SGS India Pvt. Ltd. - Attention is also drawn to the decision of this Court in A.T.E. Enterprises Pvt. Ltd. 2017-TIOL-1906-HC-MUM-ST and Maersk India Pvt. Ltd. 2015-TIOL-516-HC-MUM-ST where Revenue's appeal on similar facts has been dismissed, by following the decision of this Court in SGS India Pvt. Ltd. - It is an agreed position that this case stands concluded by decision of this Court in SGS India Pvt. Ltd. which has been followed by Tribunal, no substantial question of law would arise for consideration in this appeal: HC
- Appeal dismissed: BOMBAY HIGH COURT
2018-TIOL-2696-CESTAT-HYD
Andhra Organics Ltd Vs CCT
CX - Assessee is manufacturer of bulk drugs and they availed CENVAT credit of service tax paid on 'tour operator services' used for transporting workers and staff to the factory - It is the contention of assessee that they are entitled to benefit of this CENVAT credit because this service is used in relation to the manufacture of their final products - The department contends that provision of bus service to bring workers to the factory is only a welfare measure and it has no nexus with manufacturing operations - The question is whether bringing the workers to the factory from homes can be termed as an input service is in relation to the manufacture of final products - Once the workers come into the factory their services are used in relation to the manufacture of final products - But bringing workers to the factory or providing accommodation to them outside the factory or providing any other welfare measures for the workers or their families have no nexus with the manufacture of the final products, although they are welfare measures meant for the general well being of the workers who manufacture the goods - Thus, assessee is not entitled to credit of service tax paid on buses hired to bring workers to their factory - In concluding so, judgment of High Court of Bombay in case of Manikgarh Cement 2010-TIOL-720-HC-MUM-ST and in case of Maruti Suzuki Ltd 2009-TIOL-94-SC-CX were relied upon - Therefore, assessee is not entitled to credit of service tax paid on tour operator services for bus provided by them to carry workers from their residence to the factory: CESTAT
- Appeals rejected: HYDERABAD CESTAT
2018-TIOL-2695-CESTAT-ALL
Honda Siel Cars India Ltd Vs CCE
CX - SCN was issued for period 14th November, 2005 to 31st August, 2006 on the assessee/manufacturer of passenger cars, as it appeared to Revenue that they have evaded the payment of Central Excise duty by short payment of duty on the clearances of passenger cars, described as "Demo Cars", contravening the provisions of Rule 4, 6, 8 of CER, 2002 r/w Section 4 of CEA, 1944 - There is no element of advertisement in discount given by assessee company in clearance of Demo Cars - SCNs are against the concept of transaction value under Section 4 of the Act - The discount has been given by assessee in terms of business policy, which was widely known as "Trade Discount" and they had also made adequate disclosures to Revenue - The Trade Discount under dispute was known to all, prior to removal of goods and the same have also been given at the time of clearance - Accordingly, same is permissible under Section 4 of the Act - The facts herein are squarely covered in favour of assessee by ruling of Apex Court in case of Bombay Tyres International Pvt. Ltd. 2002-TIOL-33-SC-CX-LB and Purolator India Ltd. 2015-TIOL-193-SC-CX, wherein the concept of transaction value was explained and has to be read along with expression "for delivery at time and place of removal" - Hence, transaction value has only to be as at the time of clearance of goods from factory or depot, actually paid or payable for goods, when sold means agreed price, whether paid, paid in part or not been paid at all - Adjudicating Authority is directed to grant refund of deposits made during investigation and subsequently, within a period of 3 months: CESTAT
- Appeals allowed: ALLAHABAD CESTAT
2018-TIOL-2694-CESTAT-MAD
CCE Vs ITC Ltd
CX - The assessee company is engaged in manufacturing paper boards falling under CETH 48109900 of CETA 1985 - Perusal of assessee's annual report for the relevant AY revealed that one M/s Wimco had become the assessee's subsidiary - The Department opined that such relation made both companies to be 'related persons' u/s 4(1)(b) of the CEA 1944 - The Department then alleged that the assessee sold paper board manufactured by it to M/s Wimco at lesser prices, which resulted in short payment of duty - Duty demand was raised with interest & equivalent penalty was imposed - On appeal, the Tribunal held that the Department erroneously applied the provisions of Rule 8 of the Central Excise Valuation Rules, 2000 - The Tribunal then remanded the matter to look into whether the relationship between the assessee & M/s Wimco influenced the price of goods sold to the latter - On de novo adjudication, the Commissioner noted that such relationship had in fact influenced the price - Hence transaction value u/s 4(1)(a) was inapplicable & favored cost construction method as per Rule 8 of the Valuation Rules - Hence the Department re-iterated its demands for duty with interest & imposed equivalent penalty u/s 11AC of the Act & Rule 25 of the CER 2002 - Hence the assessee's appeals - The Department also issued SCNs for two different periods, raising duty demands with interest & penalty for goods cleared to M/s Wimco at lesser prices - However such demands were set aside by the Commr.(A) - Hence the Department's appeals.
Held - It is undisputed that the assessee & M/s Wimco are 'inter-connected undertakings' and hence are related persons as per mandate of Section 4 - Hence the valuation for charging Excise duty would be as per provisions of Section 4(1)(b) - Critical examination of the re-adjudication order reveals it to be suffering from several aberrations & misconcieved conclusions - Mischief under Rule 9 is attracted only if all excisable goods are sold by assessee exclusively to or through a related person - Only then would the value of such goods be taken as value of goods sold by the related person or where the related person uses or consumes such goods in production or manufacture of articles - In the present case, it is seen that the assessee did not sell everything to or through M/s Wimco - It is nobody's case that there happened to be no buyers for the same goods - The Commissioner notes 235 incidents wherein goods were sold to other buyers - Hence the invocation of Rule 9 leading to valuation u/s 8 is unjustified - Hence the invoices were wrongly compared & wrong inferences were drawn from it - Hence the reasoning is based on incorrect interpretation of law & so is incorrect - Further, there is no allegation of any flow back from M/s Wimco to the assessee for the allegedly lower pricing - Hence the assessee's appeal is allowed - Regarding the Department's appeal, the Commr.(A) correctly noted that the assessee also sold goods to other buyers - Also the O-i-A in challenge is based on correct interpretation of several precedent cases, which the Department could not counter - Hence the demands & penalties for the two ther periods are not sustainable and the Departmental appeals do not sustain: CESTAT (Para 2-4,7.5-7.7)
Department's appeals dismissed: CHENNAI CESTAT
CUSTOMS
2018-TIOL-1791-HC-MAD-CUS
T G Silks Ltd Vs Chief Commissioner of Customs
Cus - The petitioner company imported some goods - However the bills of entry for the same were filed after a delay - The Department imposed charges for such delayed filing of bills of entry - Hence the present writ seeking waiver of such charges and also seeking refund of such charges paid.
Held - The Department is yet to pass an order for such application filed by the petitioner and it is yet to assign any reason why such request should be denied - Only when such order is passed would the petitioner be able to come up with a remedy in case the application should be rejected - Hence the Department is directed to pass an order regarding such application after giving opportunity of personal hearing - Such exercise be done within a period of three weeks: HC (Para 1,4,5)
- Writ petition disposed of
:
MADRAS
HIGH COURT
2018-TIOL-2693-CESTAT-MAD
Epson India Pvt Ltd Vs CC
CUS - The assessee imported goods namely, business projectors - It classified the subject goods under CHT 85286100 and were assessed to BCD at nil rate of duty in terms of Notification No. 24/2005-Cus., ADD @ 10% and education cess at 3% and SAD at nil rate in terms of Notification No. 29/2010-Cus - However, the Revenue took a view that the goods were rightly classified under CTH 85286900 and not eligible for claiming exemption under the said notifications - The Adjudicating Authority confirmed the demand along with interest & penalty - On appeal, the Commr. (A) upheld the same - Hence, the present appeal.
HELD - The Tribunal in the case of Commr. (CUS) vs. Vardhaman Technology P. Ltd. analyzed the issue as to whether the projectors having other features like video port, S-video port, HDMI, RCA etc. would be classifiable under 852861900 - It held that the subject goods were to be classified under CTH 85286900 - Recently, Delhi bench of the Tribunal in the case of M/s. Casio India Co. Pvt. Ltd. Vs. Commissioner of Customs, New Delhi vide Final Order No. 55283/2016 also held the issue in favour of the assessee - Hence, the demand is deleted and order under challenge is set aside : CESTAT (para 1, 2)
- Appeals allowed: CHENNAI CESTAT
2018-TIOL-2692-CESTAT-DEL
Dex Logistics Pvt Ltd Vs CC
CUS - The assessee’s custom broker license was revoked in order-in-original – The Revenue initiated disciplinary proceedings against the assessee - However, on appeal the Tribunal set aside the order – Hence, the present appeal.
HELD - The offence report based on which SCN has been issued has been received only on 25/05/2017 - If the date of receipt of offence report is considered as 25/05/2017, the show cause notice dated 23/08/2017 is to be considered as issued within the period of 90 days specified in Regulation 20 of the CBLR 2013 – The Tribunal mistakenly took date of passing of order-in-original as date of offence report – Hence, the order under challenge is recalled : CESTAT (para 1, 5, 6)
- Application allowed: DELHI CESTAT |
