SERVICE TAX
2018-TIOL-3616-CESTAT-HYD
CCCE AND ST Vs Clt Engineering Enterprises
ST - The assessee is registered for providing 'Maintenance or Repair Services' - During period of dispute, the Revenue alleged that the assessee did not pay the complete amount of tax payable - Duty demands were raised with interest & penalty - On appeal, the Commr.(A) deleted part of the demand on grounds that there was no maintenance contract in that period - The remaining duty demanded was re-quantified.
Held: For the period for which the demand was dropped, the assessee submitted documents mentioning services rendered to their main client - These clearly indicate there to be contracts for one year online mechanical repair works and cleaning of wagon tipplers and conveyor galleries of stacking stream in RMHP (Ore & Flux) – Part-1 - Another contract is for cutting, bagging and loading of solid pitch in coal chemical plant - Hence the Commr.(A) erroneously dropped the demand on grounds of there being no contract - Regarding the remaining amount of duty, it is seen that the duty calculated by the Commmr.(A) has been held to be erroneous, by both the parties - Hence the matter warrants remand to the Commr.(A) for considering all evidence and passing a fresh order: CESTAT (Para 2,6,8)
- Case remanded: HYDERABAD CESTAT
2018-TIOL-3615-CESTAT-HYD
Gmr Vemagiri Power Generation Ltd Vs CCCE
ST - The assessee company, entered into an agreement with Korea Plant Service & Engineering Company Ltd., for operation & maintenance of power plant - The assessee paid consideration to such firm & paid service tax after calculating the same itself - The assessee later realized that its agreement was in fact a composite contract, the assessee claimed refund of the service tax paid - Such refund was rejected by the adjudicating authority & by the appellate authority.
Held: The issue at hand is already decided in the assessee's own case - A similar issue was resolved by the Bombay High Court in Parijat Construction and by the Madras High Court in 3E Infotech - It is well-settled law that the decision of the High Court will prevail over that of the Tribunal - Hence the decisions relied on by the Revenue do not further its case - Hence the denial of refund is unsustainable: CESTAT (Para 2,7-11)
- Assessee's appeals allowed: HYDERABAD CESTAT
2018-TIOL-3614-CESTAT-DEL
Sks Ispat And Power Ltd Vs CCE & ST
ST - The assessee company claimed refund of duty u/s 11B of the CEA 1944 - While such claim was initially disallowed, the Tribunal later granted the same - While the Revenue disbursed the amount of refund, it did not pay any interest - The assessee filed an appeal against the order sanctioning merely the principal amount, but was unsuccessful.
Held - It must be seen whether the Revenue is liable to pay interest u/s 11BB from the date of expiry of three months time from date of receipt of refund application or from expiry of three months from date of sanctioning of refund - Perusal of provisions of Section 11B clarify that the application seeking refund of duty with interest must be filed within one year from date of becoming entitled for refund - Further, Explanation to Section 11BB clarifies that where any refund order passed by the Commr.(A) or Tribunal will be deemed as being an order passed u/s 11B(2) - Considering that in the present case, the refund has been considerably delayed by the Revenue, the automatic liability of the Department u/s 11BB stands invoked - Hence it is liable to pay interest as well: CESTAT (Para 2,6,7,11,12)
- Assessee's appeal allowed: DELHI CESTAT
CENTRAL EXCISE
2018-TIOL-3619-CESTAT-HYD
Akzo Nobel India Ltd Vs CC, CE & ST
CX - The assessee company, engaged in manufacturing paints, availed Cenvat credit on input goods & services - The Revenue denied credit availed on construction of warehouse in factory premises, for the period Dec 2009-Jan 2011 - Input credit on repair & maintenance of Automatic Dispensing Machines installed in dealer's premises, was also disallowed for period Sept 2007-Nov 2011 - The Revenue opined that the maintenance of these machines is beyond stage of manufacture & place of removal did not entitle the assessee to avail credit - It also opined that construction of warehouse lacked any nexus with the manufacture process & so was ineligible for credit - Duty demands were raised with interest for recovery of credit, u/r 14 of CCR 2004 - Penalty u/r 15 of CCR 2004 r/w Section 11AC of CEA 1944, was also imposed - Such demands were sustained by the Commr.(A).
Held: During the period of dispute, credit could be availed on input services used directly or indirectly or in relation to the manufacture of final products & clearance upto place of removal - It also included services used in relation to modernization, renovation or repair of factory - In present case, warehouse was built within factory premises - Hence the Revenue lacks valid reason to disallow credit, as the warehouse was built before place of removal - Hence demand on this count is set aside - Regarding the service tax paid on maintenance of ADMs, the assessee cannot claim credit since the machines are located in the dealer's premises & so are beyond the place of removal - Regarding invokation of extended limitation, the assessee cannot be charged with suppression of facts since the ER-1 did not require the assessee to show dealers of credit availed on each input goods or services - But the assessee is obliged to ensure availment of credit as permitted by law - As the assessee irregularly availed credit beyond place of removal & evaded payment of duty, the mens rea to such end is apparent from record - Hence the extended limitation is correctly invoked - The demand for interest & penalty be reduced proportionately: CESTAT (Para 3,7)
- Assessee's appeal partly allowed: HYDERABAD CESTAT
2018-TIOL-3618-CESTAT-ALL
CCE Vs Continental Milkose India Ltd
CX - Revenue has filed the present appeal against impugned order vide which Commissioner (A) has set aside the penalty imposed upon assessee while dropping a part of demand and confirming another part, on the ground that there was no mala fide on the part of assessee - The issue involved before Lower Authority was as regards valuation of goods supplied to defence as also in respect of stock transfer i.e. whether the demand is required to be paid under Section 4 or 4A - Without going into the detailed merits of case, Commissioner (A) has dropped the penalty - As against the finding of Appellate Authority as regards absence of any mensrea on the part of assessee, Revenue has not advanced any evidence to rebut the same - The said finding of the Commissioner (A) does not stand rebutted by the Revenue by production of any evidence - Accordingly, no reasons found to interfere in the impugned order of Commissioner (A): CESTAT
- Appeal rejected: ALLAHABAD CESTAT
2018-TIOL-3617-CESTAT-AHM
Sakata Inx India Ltd Vs CCE & ST
CX - The assessee availed Cenvat credit on HR Plates used to fabricate Storage Tank used for factory & laboratory furniture - The Revenue denied credit on grounds that HR Plates did not classify as inputs.
Held - The HR plates are not only used in the factory, they are also used in relation to the manufacture of final product - Hence HR Plates qualify as inputs as per Rule 2(k) of CCR 2004 - Hence credit is admissible to the assessee - The assessee did not contest the denial of credit availed on laboratory furniture & reversed the credit - Hence the demand raised in this regard is sustained - Interest cannot be demanded in the present case since the assessee only availed credit & did not utilize it: CESTAT (Para 1,6-9)
- Assessee's appeal partly allowed: AHMEDABAD CESTAT
CUSTOMS
2018-TIOL-3620-CESTAT-DEL
Reliance Transport And Travels Ltd Vs CC
Cus - The assessee company imported aircraft - Upon clearance, the assessee claimed exemption under Notfn No 21/2002-Cus - The assessee submitted NOC issued by the Ministry of Civil Aviation & other documents in support of such claim - The assessee also furnished an undertaking to the Customs Department to the effect that the aircraft would be used only for providing NSOP services - Thereupon, the assessee was given exemption under the Notfn - The Revenue later alleged that the aircraft was being used for private purposes, in contravention of the conditions laid down in the Notfn No 21/2002 r/w Notfn No 61/2007 - Hence duty demand was raised with penalty u/s 112(a) - The aircraft was ordered to be confiscated and redemption fine was imposed.
Held: The decision of the larger bench of the Tribunal in VRL Logistics Ltd. vs. CC, Ahmedabad is inapplicable to the facts of the present case - Besides, the Apex Court in Collector vs. AlNoori Tobacco Products held that additional or different facts can make considerable difference between the conclusion in two cases - Thus in such circumstances, disposal of the case by following settled precedent is not just & proper - Evidently, the assessee did not use the aircraft in a manner which contravenes the permit granted by the DGCA to operate as NSOP - The DGCA did not concel the permit & renewed it timely - The assessee operated its aircraft mainly for charter operations which are permissible under NSOP - Besides, the adjudicating authority travelled beyond the scope of the SCN by raising duty demand u/s 28 when in fact such proposal was absent in the SCN - Thus the assessee rightly availed such concession under Notfn No 21/2002-Cus r/w Notfn No 61/2007-Cus - The Revenue is directed to release the bank guarantee furnished by the assessee: CESTAT (Para 1-5,14-17)
- Assessee's appeal allowed: DELHI CESTAT
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