SERVICE TAX

2018-TIOL-3143-CESTAT-MAD

Carris Pipes And Tubes Pvt Ltd Vs CCE

ST - Assessee is engaged in manufacture of water storage tanks - It was noticed that they had incurred freight charges for transport of their goods, but had not paid the service tax - SCN was issued proposing to demand service tax along with interest and also for imposing penalties - The main contention put forward by assessee is that they had availed services of individual transporters/truck owners - Assessee had prepared vouchers to evidence the payment of freight charges to these transporters - On perusal of documents, it is found that it does not contain any detail with respect to the goods consigned - These vouchers were nothing but documents for monitoring the payment of freight charges to the transporter and can, in no way, be construed as a consignment note - It does not, therefore, evidence the receipt of goods by consignee, but merely the details of vehicle, trip and the freight charges paid - The same cannot be called a consignment note as under Section 65(50b) of FA, 1994 - A similar issue was considered by Tribunal in South Eastern Coalfields Ltd. 2016-TIOL-2773-CESTAT-DEL - Similarly, in Ultra Tech Cement Ltd. 2017-TIOL-4224-CESTAT-MUM , the Tribunal held that slips, challans issued to monitor the payment of freight or transportation of goods, cannot be considered as consignment note - Demand cannot sustain and same is set aside: CESTAT

- Appeal allowed: CHENNAI CESTAT

Gowtham Marketing Vs CCE

ST - The assessee is engaged in promotion of DTH services - It sold recharge voucher of another entertainment company - The Department was of the view that the assessee were liable to discharge service tax on the recharge vouchers supplied to the customers - Duty demand was raised - The Original Authority confirmed the demand, interest and imposed penalties - On appeal, the Commr. (A) upheld the same.

Held: The issue with respect to whether sale and purchase of SIM cards, recharge coupons, starter packs would amounts to Business Auxiliary Service & are liable to levy of service tax has been settled by the ratio laid down in G.R. Movers case - Following the same the demand for service tax is deleted - Hence, the order under challenge is set aside : CESTAT (para 1, 5)

- Assessee's appeal allowed: CHENNAI CESTAT

CENTRAL EXCISE

2018-TIOL-3141-CESTAT-MAD

Rajasriya Automotive Industries Pvt Ltd Vs CCE

CX - The assessee company is engaged in manufacturing Power Steering Column assembly & Power Steering Components - It availed credit on the service of outward transportation of finished goods to the buyer's premises - The Department denied such availment on grounds that the buyer's premises did not constitute 'place of removal' - Duty demand was raised seeking reversal of such credit.

Held: The issue at hand is no longer res integra and has been settled in various cases - The Department relied on the decision in CCE Nagpur Vs Ispat Industries Ltd. to deny credit on grounds that the Apex Court did not consider the buyer's premises to be place of removal - However, such decision had been rendered on the issue of valuation - Hence the order in challenge merits being set aside: CESTAT (Para 2.1,2.2,8)

- Assessee's appeal allowed: CHENNAI CESTAT

Renowned Auto Products Manufacturers Ltd Vs CCE

CX - Assessee is engaged in manufacture of shock absorbers and door balancers - On verification of stock, it was noticed that in respect of certain types of shock absorbers, the actual quantity of stock available in the factory was less than the quantity shown in RG 1 Register - In certain other cases, the actual quantity was in excess of the quantity shown in RG 1 Register - The officers seized the fully finished shock absorbers which were found over and above the quantity accounted in the RG 1 Register and some incriminating documents were recovered under Mahazar - Demand confirmed alongwith interest and penalties - The assessee is aggrieved by non-supply of certain relied upon documents - It has been conceded by assessee that documents had been supplied to previous management - Shri R. Amirthraj and Shri M.S. Shankar of assessee had received the original documents and had given acknowledgment - That however, the assessee did not return the original documents and further no proof has been provided by assessee to prove that documents had been returned back - When the documents have been handed over to the earlier management, assessee who are the present management, cannot keep on making the plea of non-receipt of documents, which were not transferred to them by the earlier management - The department certainly cannot be held responsible for this - There has been sufficient compliance by the department of natural justice inasmuch as the documents relied upon in SCN has very much been provided to the earlier management who were noticees at that point of time - Coming to grievance of denial of cross-examination, Shri Amirtharaj had been examined on 20.1.2005 - With regard to the other persons, the adjudicating authority has discussed in detail how adequate opportunities had been given to other witnesses - However, none of them had turned up for cross-examination - No merit found in the contentions put forward by assessee for which reason they are rejected - While all liabilities including tax liability is generally transferred, the same cannot be said for penalty - The present assessees cannot be made responsible for the acts done by the previous management - Tribunal in the case of Marcandy Prasad Radhakrishna Prasad Pvt. Ltd. 2002-TIOL-3 81 -CESTAT- KOL held that the present management cannot be responsible for illegal activities carried out during time of previous management and penalty is not imposable under Rule 173Q of CER, 1994 - Adopting the same ratio, penalty imposed under Rule 173Q is not imposable on the present assessee and hence the same is set aside - To ensure that there is no mis-carriage of justice by way of errors in calculation, the issue is once again remanded to the adjudicating authority, however, for the limited purpose of taking into account the above contentions of assessee and if found correct, the adjudicating authority shall rework the duty liability that may consequentially emerge: CESTAT

- Appeal allowed: CHENNAI CESTAT

CUSTOMS

2018-TIOL-3145-CESTAT-HYD

Mohammed Azmatullah Vs CCT

Cus - SIB Branch of Hyderabad, Customs carried out investigations into alleged smuggling of automobile tyres in container and consigned to one M/s Great Overseas, Hyderabad which was manifested wrongly in IGM as Chappals - Authorities recorded the statement of Shri M.A. Mujahid who is the proprietor of M/s Great Overseas and also of the assessee herein who is proprietor of Reliance tyres - On the conclusion of investigation, it was noticed by authorities that, assessee was contacted by agents of shipping lines, who had ferried the consignment - SCN was issued for confiscation of goods along with imposition of penalties to one M.A. Mujahid and also assessee - Appeal is only against imposition of penalty U/s 112 (a) of Customs Act, 1962 - Though the shipping line Manager has stated that he was contacting the assessee on his mobile number, it is not indicated in the said statement that it was in respect of declarations to be made on IGM or in respect of the disputed consignment - It is on record that the statement of Shri M.A. Mujahid, the proprietor of Great Overseas claimed that consignment was imported by him and there was a misdeclaration on IGM by the shipping lines which he was trying to rectify by getting in touch with the overseas supplier - It is also to be noted that no role is attributed to the assessee and no bill of entry is filed by them so as to allege any mis-declaration - In the absence of anything to indicate that assessee played any role in importing tyres in guise of chappals, provisions of Sec.112 (a) of Customs Act, 1962 are not attracted: CESTAT

- Appeal allowed: HYDERABAD CESTAT

Mohan Breweries And Distilleries Vs CC

Cus - The assessee acquired the raw material soda ash used in manufacture of glass, from various sources, by duty-paid imports and also without payment of duty under Advance Licenses / Advance Authorizations - Assessee has also represented that they procure soda ash from local glass manufacturers on a need-to basis during times of scarcity of raw material - The pertinent fact that has been pointed out is that the soda ash coming from all these three streams are stored in the same place and as such the quantities having merged, it will not be possible to distinguish the nature and source of the soda ash that is being removed from there for home consumption or for clearances outside the factory - Thus, the quantity of duty-free imported soda ash that would require differential customs duty to be paid thereon on account of their having been removed from the factory, will then have to be calculated after taking into account all such receipts of soda ash from different sources and total removals to arrive at the net removal from factory - Assessee submit that they are in a position to provide necessary documentary evidence to substantiate their contentions - Matter remanded back to the adjudicating authority for denovo consideration and to arrive at the net quantity of duty free imported soda ash that may have been removed outside the factory for limited purpose of calculation of net duty and without liability - As regards penalty, there is no allegation of clandestine removal of soda ash - In fact, all the removals appear to have been removed under invoices and properly accounted - Assessee have also fulfilled the export obligation in respect of Advance Licenses / Advance Authorizations - In these circumstances, while differential customs duty will definitely accrue in respect of the quantities of duty-free imported soda ash that may have been removed in violation of import conditions, nevertheless, no malafide can be attributed to such clearances - In the event, penalties imposed on assessee under section 114A ibid will not sustain and is therefore set aside - So also the penalty of Rs.4,00,000/-imposed on Shri V. Jothi is also not justified and the same is also set aside: CESTAT

- Appeal partly allowed: CHENNAI CESTAT