SERVICE TAX
2018-TIOL-3027-CESTAT-MAD Bright Marketing Company Vs CCE
ST - The assessee company short-paid duty for the period in dispute, on account of change in law due to which it had to pay tax on accrual basis - Thereafter, it shifted to payment of tax on receipt basis - On being pointed out, the assessee immediately paid the balance amount with interest - Additional interest demanded was also paid & requisite returns & declarations were filed - However, penalty was levied on the assessee on grounds that ST-3 returns for the relevant period had not been filed - The assessee also sought benefit of reducing penalty.
Held: The penalty u/s 78 is attracted only if there is suppression of facts - In many decision, it has been held that if an issue requires detailed arguments for reaching a conclusion, the same cannot be said to be an error apparent on the face of record - It is seen that the lower authorities did not offer the option of reduced penalty to the assessee while the Tribunal earlier recorded that the same was offered but not availed of by the assessee - This counts as an error apparent on record which must be rectified - Hence the penalty be reduced by offering such benefit to the assessee: CESTAT (Para 2,5)
- Appeal partly allowed: CHENNAI CESTAT
2018-TIOL-3026-CESTAT-MAD
G Krishnamurthy Vs CCE & ST
ST - Assessee was rendering taxable services under categories of CICS, BAS and Man Power Recruitment and Supply Agency Service - On scrutiny of documents produced and the deposition made by assessee, it appeared to the department that assessee had not taken out service tax registration under categories of CICS and BAS in time and had not paid appropriate service tax on the taxable value of service rendered by him on the presumption that services rendered by him would not attract service tax - In view of the decision in L & T Ltd. 2015-TIOL-187-SC-ST, demand raised by adjudicating authority and upheld by Commissioner (A) on CICS for the period from 10.09.2004 to 30.04.2006 is set aside - As regards the demand raised under BAS for the period 16.06.2005 to 30.09.2006, if job work done is not amounting to manufacture, then service tax is leviable on such job-work activities, original authority has clearly brought out that the work carried out by assessee are welding, framing and turning works on metal products which do not amount to manufacture and hence such services are correctly classifiable under BAS and liable for payment of service tax - As regards to penalties, same is imposed by adjudicating authority under Section 77 & 78 of FA, 1994 - More than half of the confirmed demand under CICS has been found as unsustainable - Further, even in respect of taxability on job work, there was indeed some confusion in the matter especially and whether process itself amounted to manufacture was in dispute - There was reasonable cause for assessee for their failure to pay up their tax liability confirmed and upheld in respect of BAS - Hence, the penalties are unjustified, same are therefore set aside: CESTAT
- Appeal partly allowed: CHENNAI CESTAT
CENTRAL EXCISE
CIRCULAR
excircular1067
Online registration and online filing of the claims, by the eligible units for disbursaI of budgetary support under Goods and Service Tax Regime, located in States of Jammu & Kashmir, Uttarakhand, Himachal Pradesh and North East including Sikkim CASE LAWS
2018-TIOL-3029-CESTAT-DEL
Amar Enterprises Vs CGST & CE
CX - Assessee, a 100% EOU engaged in manufacture of copper ingots from various kinds of copper scraps such as mixed copper cable scrap, mixed copper scrap, copper scrap, MS scrap and rubber picuks - The assessee, after segregation of scraps retrieves copper from the same and the copper scrap so obtained is melted and from it copper ingots are manufactured - The department has entertained a doubt that assessee is under-reporting the recovery of copper from copper scrap procured by them and by indulging into lower recovery, they are suppressing the manufacturing and clearance of copper ingots and thereby evading central excise duty - For establishing the clandestine manufacture and clearance, the department has not made any sincere efforts to establish that assessee have manufactured and clandestinely cleared the copper ingots over and above what was declared by them in their statutory records - Average recovery of copper from five consignments of copper scrap cannot form concrete evidence to demand duty over and above the declared quantities of clearances of copper ingots - Since a huge quantity of copper ingots cannot manufactured and sold without leaving some traces of evidences but no efforts have been made to prove the same - Thus, charges of clandestine manufacture and clearance is not established on the basis of available evidences - Since the demand itself is not sustainable on merit and therefore, question of imposition of penalties under Section 11AC of the Act on the firm and under Rule 26 of Central Excise Rules on the partners does not arise and thus, same are also set aside: CESTAT
- Appeals allowed: DELHI CESTAT
2018-TIOL-3028-CESTAT-AHM
AIA Engineering Ltd Vs CCE
CX - The issue at hand pertains to availment of credit on Construction services, convention services & rent a cab services - Such services were availed after April 01, 2011 - The Revenue denied credit on grounds that construction services & rent a cab services services had been excluded from scope of 'input service provider' - Regarding convention service, credit was disallowed on grounds that holding workshop on maintenance of bulk handling system is optional services for the assessee & is not necessarily related to manufacture.
Held: The input of rent a cab service was excluded only in a case where a motor vehicle which is rented out is not a capital goods - Considering definition of 'capital goods', in the present case, the passenger vehicle was taken on rent by the assessee which falls under Chapter Head 87.02 -Accordingly, in terms of definition of capital goods under Rule 2(a)(B) the motor vehicle taken on rent by the assessee is a capital goods - Therefore, it does not cover under the exclusion entry provided under clause 2 (e) under sub clause B of Rule 2(a) of CCR 2004 - Therefore, rent a cab is an admissible input service & credit is admissible - Regarding convention services, it is not for the Revenue to decide which are optional & which are the essential services for a business organization - Such service was used to upgrade system for maintenance of bulk handling which is related to manufacture and removal of goods - Hence credit cannot be denied on the same - Hence demands raised on rent a cab and convention services are set aside while demand under construction service is remanded for verification: CESTAT (Para 1,5)
- Appeal partly allowed: AHMEDABAD CESTAT
CUSTOMS
NOTIFICATIONS
dgft_trade_notice_34_2018
Activation of E-com module for applying for SEIS, based on ANF 3B as notified vide Public Notice 15/2015-20 dated 28.06.2018
dgft17cir013
Govt allows exports benefits under SEIS to educational services provided to NRI students
CASE LAWS
2018-TIOL-2074-HC-DEL-CUS + Case Story
Anil Chaudhry Vs Yakult Danone India Pvt Ltd
Cus - A suit for defamation on the basis of statements recorded in quasi-judicial proceedings u/s 108 of the Customs Act, 1962 is clearly not maintainable: High Court [para 27]
Cus - Statements made in quasi-judicial proceedings before the Customs Authorities cannot be held to be defamation/libel/slander - There is no tort made out in the present suit and the suit for compensation is not maintainable, in view of the settled law - Plaint rejected: High Court [para 27 to 29]
- Plaint rejected: DELHI HIGH COURT
2018-TIOL-3030-CESTAT-MAD
Carewell Shipping Pvt Ltd Vs CC
Cus - The dispute concerns imposition of penalty of Rs.50,000/- under Regulations 18 & 20 (7) of CBLR, 2013 by competent authority on the assessee - The customs broker had verified KYC norms at the time of first customs clearance of concerned importers - There is no allegation that customs broker was aware of import of "Whey Protein" in a concealed manner - The only infraction found against customs broker is that they have not verified KYC norms as per the Regulation 11 (n) ibid - There are many cases where fraudulent importers or exporters have used even forged documents including forged IEC and other KYC documents to avail unintended benefits in import and export, while no doubt the customs broker is expected to remain vigilant and undertake the verification of documents as also comply with the other obligations cast on him under Regulation 11, he cannot be expected to cause in-depth detective investigation well that is beyond his capacity - Revenue has been at pains to point out Regulation 11 (n) speaks of an "independent" verification by customs broker - This proposition is misconceived - The only requirement in 11 (n) is that such verification is caused by the customs broker by using "reliable, independent authentic documents, data or information"; there is no fiat that such verification has to be done by the customs broker "independently" - Even the imposition of penalty of Rs.50,000/- on assessee is unjustified and cannot sustain - Impugned order is set aside: CESTAT
- Appeal allowed: CHENNAI CESTAT |
