Sanjay Kumar Bhuwalka Vs UoI

GST - High Court had granted the petitioners bail on condition of furnishing a bail bond of Rs.50,00,000/- and on further condition to deposit Rs. 39 crore to the Government Exchequer through the Competent Authority with a further direction to appear before the Investigating Officer/Authority holding investigation to assist the investigating machinery as and when called upon and to appear before the authority concerned till the final investigation or till the offence is compounded under the provision subject to the satisfaction of the Additional Chief Judicial Magistrate, Sealdah - said order was further modified by order dated July 12, 2018 to the extent that the petitioners be enlarged on bail by furnishing personal recognition bond of Rs. 10 lakh each and on further condition to deposit the evaded amount - petitioners were arrested on May 12, 2018 and are still in custody and they have not been able to be released on bail by furnishing bond with the conditions as imposed by the order dated July 12, 2018 - petitioners have sought for relaxation of conditions of bail - Counsel for Revenue submits that where the economic offence is committed the petitioners are required to be put behind bar and to hold the trial.

Held: High Court is unable to accept such contention of Revenue in view of the fact that GST Authority and their Investigating Officer has failed to submit charge sheet against the petitioners and even no extension of time to complete the investigation has been sought for by them - in view of latest decision of the Apex Court that the courts cannot extend investigation period under Section 167 of the Code of Criminal Procedure, High Court is pleased to relax the conditions of bail imposed by its order dated July 12, 2018 so as to enable their release on bail as they have statutory right to be released and further bearing in mind the principles as to presumption of innocence and the right of liberty guaranteed under Article 21 of the Constitution of India - petitioners directed to be released on furnishing personal bond of Rs. 50,00,000/- each to the satisfaction of Additional Chief Judicial Magistrate, Sealdah - Applications disposed of: High Court [para 17, 18]

- Applications disposed of: CALCUTTA HIGH COURT

SERVICE TAX

2018-TIOL-3177-CESTAT-DEL

Jdsu India Pvt Ltd Vs CC

ST - The assessee had imported certain equipments for the purpose of testing telecommunication networks - The Department wants the same under CETH 90308990 - But assessee classified the same under CETH 90304000 which deals with "Other instruments and apparatus, specially designed for telecommunications which was at NIL rate of duty - Both the lower authorities have rejected the claim of assessee - The crux of dispute is whether the items under import are specially designed testing equipments for telecommunications - If so, they will get classified under CETH 90304000, as sought by the importer and will be entitled to duty free clearance - But the Authorities below have taken the view that the imported goods are capable of being used both for telecommunications applications as well as other applications such as in LAN network and hence, they cannot be held as apparatus specially designed for telecommunications - The modal HST-3000 is said to have the key ingredients for electrical and optical Ethernet testing - It is essentially designed for installation and trouble shooting in case of various LAN and other forms of Ethernet - It also has capabilities for use in cable diagnostics - Hence, imported equipment has applications both in telecom i.e. communication over long distance and also LAN i.e computer network within an office - Hence, it cannot be said to be specially designed for telecom - Both the Authorities below have held that such testing tools are capable of use for telecommunications as well as other applications such as LAN Network - LAN Network is essentially a system of inter-communication of computers in a given office - They are commonly understood as a computer network and are not described as telecommunication network - No infirmity found in the impugned order: CESTAT

- Appeal dismissed: DELHI CESTAT

2018-TIOL-3182-CESTAT-MAD

Optimus Global Services Ltd Vs CST

ST - The assessee filed the present appeals challenging denial of Cenvat credit availed on several input services such as Travel Expenses, Transport of Household goods, Insurance, Rent for building & rent for cafeteria.

Held: Regarding travel expenses, the O-i-O is self contradictory and denies credit even while holding that the assessee is eligible to avail the same - Hence such order merits being set aside - The denial of credit on Transport of Household goods is not contested - Regarding denial of credit on insurance services, it is seen that the Tribunal settled an identical issue in Fiem Industries Ltd. Vs. C.C.E. Chennai III wherein it was held that insurance service protects workmen from hazard - Hence following such findings, credit on such service is allowed - Regarding the denial of credit availed on rent, it is seen that during the period of dispute, the scope of 'input service' covered rental services too - Following the decision in M/s. Microsoft Global Services Centre (India) Pvt. Ltd. Vs. Commissioner of Central Excise, Customs and Service Tax, Bangalore-I credit on such service cannot be denied: CESTAT (Para 1,4,6,9,10)

- Assessee's appeals allowed: CHENNAI CESTAT

2018-TIOL-3181-CESTAT-MAD

International Seaport Dredging Ltd Vs CST

ST - The assessee is engaged in Dredging, Reclamation of Seaports and allied activities - The assessee hired dredgers / vessels from various companies who do not have any permanent establishment in India - The dispute relates to the liability of assessee to pay service tax on hiring of dredgers / vessels from the foreign company under category of 'Supply of Tangible Goods Service' on reverse charge basis in terms of section 66A of FA, 1994 - Inclusion of customs duty, entry tax etc. on the import of materials used for dredging services, which were paid by clients on actual basis, in the taxable value for dredging services at the hands of assessee - An identical dispute with reference to the very same tax entry came up before the Tribunal in Petronet LNG Ltd. - 2013-TIOL-1700-CESTAT wherein it is held that said activities on the part of the owner does not take away the right of possession and effective control of the hirer - Agreement should be considered as a whole and mere employment of personnel does not derogative from the reality of transfer of possession to and effective control by assesse over the tanker for their use - There is a transfer of possession and effective control of vessels to the assessee under the various clause of charter agreement which clearly brings out that assessee is having legal right of possession and effective control of the vessel - There is no sale of vessel in present transaction - The owner of vessel continues to be the owner - It is necessary and legally permissible for the owner to put certain restrictions and obligations on the part of assessee who uses the supplied vessel for the intended purposes - This arrangement is outside the purview of service tax liability under a 'supply of tangible goods services' - On the second issue, regarding demand of service tax on customs duty and entry tax paid on imported equipment, which were reimbursed by the recipient of service, assessee was not contesting service tax on dredging operations - The clients paid consideration for such dredging work - The Board vide Circular dated 13.4.2016 clarified that taxes, duties are not consideration for any particular services as such and accordingly excise duty, customs duty, octroi etc. cannot be subjected to service tax - As such, customs duty reimbursed by clients on actual basis cannot form part of taxable value for services rendered by assessee - Impugned order set aside: CESTAT

- Appeals allowed: CHENNAI CESTAT

CENTRAL EXCISE

2018-TIOL-3180-CESTAT-MAD

Alkraft Thermotechnologies Pvt Ltd Vs CGST & CE

CX - The assessee manufactures radiators & parts thereof - It availed Cenvat credit on duty paid on input goods & services - The Department noted that the assessee availed Cenvat credit on outward transportation of goods cleared from factory gate to their own units on stock transfer basis - Duty demands were raised seeking reversal of duty with interest & imposed penalties - Such demands were upheld by the Commr.(A).

Held: The Apex Court in its decision in Commissioner of Central Excise Vs. Ultratech Ltd. held that after 1.4.2008, Cenvat credit on GTA service is not eligible from the factory to buyer's premises and eligible only upto the place of removal which is the factory gate - Hence the credit was incorrectly availed by the assessee: CESTAT (Para 2,8,9,10)

- Assessee's appeals dismissed: CHENNAI CESTAT

2018-TIOL-3179-CESTAT-MAD

Texbond Nonwovens Vs CCE

CX - The assessee is engaged is manufacturing Non-woven fabrics - It purchased the inputs such as PP Spun granules from Reliance Industries Ltd., which is a 100% EoU - RIL paid Excise duty as per Notfn No 23/2003-CE - The Department opined that the assessee was ineligible to avail credit on the Education Cess and the Secondary & Higher Education Cess paid on CVD as well as the EC & SHEC paid for the third time - Duty demand was raised with interest & penalties - The Commr.(A) upheld the demands but set aside the penalties.

Held: Considering the decisions in the cases of Emcure Pharmaceuticals Ltd. Vs. CCE and CCE Vs. Jumbo Bags Ltd., the credit availed on EC & SHEC on the CVD portion is eligible - Also considering the decision in the case of Polypack Industries Vs. CCE the credit availed on the EC paid for the third time by the assessee on the CVD portion is eligible - Moreover, no interest or penalty can be imposed where the excess credit availed has been reversed: CESTAT (Para 1,5.1-5.4)

- Assessee's appeal allowed: CHENNAI CESTAT

CUSTOMS

2018-TIOL-3178-CESTAT-AHM

Jayantilal Gokaldas And Sons Vs CC

Cus - The appellant herein is a partnership firm which functions as a CHA - The appellant applied for removal of license - Meanwhile one partner passed away whereupon the remaining partners informed the Department that they would continue the business - Hence it sought two months' time to submit new partnership deed - On instruction, the appellant also submitted fresh application for CHA license - Thereafter, the appellant received an SCN proposing revocation of license & forfeit of security deposit - On adjudication, the Asst. Commr. held that the license be restored & renewed - However the Commr. of Customs overruled and revoked the license.

Held: Considering relevant portions of the enquiry report, it is seen that the order passed by the Commr. does not deal with arguments raised in the report - It is also claimed that the remaining partners have all cleared the CHA exam - Hence the Commr. did not properly examine the facts & the enquiry report & so matter warrants remand: CESTAT (Para 2,6)

- Case remanded: AHMEDABAD CESTAT