SERVICE TAX
2018-TIOL-3672-CESTAT-KOL
CCE & ST Vs Thriveni Earthmovers Pvt Ltd
ST - The disputes are centered around two contracts awarded to the assessee by M/s.TISCO as well as M/s.B.K.Coalfields Ltd.
M/s.TISCO - revenue of the view that the activity of crushing is in the nature of service falling under the category of 'Business Auxiliary Service' [BAS] and the activity of transportation of finished product to the stock yard of M/s.TISCO was liable to payment of ST under the category of 'Cargo Handling Service' [CHS] - SCNs issued covering the period February 2005 to June 2007 - the adjudicating authority upheld the demand of ST under BAS as well as CHS - assessee before CESTAT:
Held: It is obvious that all these activities are required to be carried out within the mine and in relation to mining activities and are within the scope of a single contract, even though different prices have been indicated in the contract itself for various activities - in view of the decisions in the cases of Thriveni Earthmovers Pvt. Ltd. - 2009-TIOL-683-CESTAT-MAD and Hazaribagh Mining & Engineering P. Ltd. - 2016-TIOL-3200-CESTAT-KOL, vivisecting the composite contract and charging ST on different components of the contract individually under different services is not justified - consequently, the demand is set aside and appeal of the assessee allowed [para 6, 9]
M/s.B.K.Coalfields Ltd . - revenue of the view that that the activities of drilling, loosening, excavating etc. of the overburden was liable to ST under Site Formation Service [SFS] and the activities of transportation of the mined materials as well as overburden to designated points were covered by CHS - SCNs issued covering the period February 2005 to June 2007 - the adjudicating authority dropped the demand of ST under the category of SFS and CHS - revenue before CESTAT:
Held: The adjudicating authority, after careful examination, has concluded that the activities rendered by the assesses are nothing but mining services which are chargeable to ST only w.e.f. 1.6.2007 - the various case laws cited by the assessee will be squarely applicable to the facts of this contract also - there is no infirmity in the view taken by the adjudicating authority that the activities carried out under this contract also will not be liable to be vivisected and charged to ST under individual categories - appeal filed by the revenue rejected [para 10, 11, 12]
- Appeal of Assessee allowed/Appeal of Revenue rejected 2018-TIOL-3653-CESTAT-ALL
Bismee India Enterprises Vs CCE & ST
ST - The assessee entered into a contract with M/s TRF Ltd. for promoting sale of their products by informing the company of prospective markets and potential customers, to maintain close contract with all customers and consultants in the territory of northern reason and generate, acquire and forward the enquiries to M/s TRF Ltd. - Revenue by entertaining a view that said activities of assessee amounted to provide services liable to service tax under category of BAS, raised the demand - The lower authorities have invoked the longer period only on the ground that the assessee had not paid service tax - However, assessee was reflecting value of services in their profit and loss account maintained in ordinary course of business - Such reflection of activities in profit and loss account has been held to be a reason for not allowing the revenue to invoke extended period - Inasmuch as, profit and loss account is a public document and reflection of the entire facts in the said documents cannot lead to the presence of malafide suppression on the part of the assessee - The Supreme Court in case of M/s Uniworth Textiles Ltd.- 2013-TIOL-13-SC-CUS has considered an identical situation - The said decision stands followed by Tribunal as also by High Courts in a number of decisions - One such reference can be made to the Delhi High Court’s decision in case of M/s Bharat Hotels Ltd. - 2018-TIOL-178-HC-DEL-ST - Inasmuch as, there is admittedly no evidence to show any suppression or misstatement on the part of assessee with a malafide intention and by following the referred decisions, the longer period of limitation was not available to revenue - Inasmuch as, the entire demand is beyond the normal period, same is set aside along with setting aside of penalty: CESTAT
- Appeal allowed: ALLAHABAD CESTAT
2018-TIOL-3652-CESTAT-ALL
Fusion India Inc Vs CCE & ST
ST - The assessee is a proprietory concern and is engaged in Printing as well as Printing of Flex and Sale of Computers and also Functions as Authorized person for forwarding advertisement to the Newspapers - It appeared to Revenue that assessee was providing taxable services since 2008-09 and mis-declared the value of taxable consideration received and was providing services such as advertisement service and business auxiliary service - Assessee has submitted certified copy of statement of Income as certified by Chartered Accountant wherein the Chartered Accountant has certified that the income to assessee was formed through four sources - One was printing job, other was sale of computer, third was commission received from newspaper and fourth was income from printing of flex - Printing and sale is not covered by service tax - The commission that was received from newspapers was an incentive for forwarding the advertisement for the newspapers and service recipient in the said case was a customer and this was not commission of sale of goods and, therefore, he did not get covered by Business Auxiliary Service - Printing of flex did not involve any conceptualization and visualization and, therefore, the said activity did not get covered by service tax on advertisement service - There is some mention of collection of service tax by assessee from the customers in SCN whereas the fact is that the customers of assessee informed the assessee that the activity did not attract service tax and did not pay service tax to the assessee - It is accepted that service tax was recovered by assessee even in that case if activity did not attract service tax then such collected service tax can be recovered by invoking provision under Section 73 of FA, 1994 and that present SCN did not invoke Section 73A of FA, 1994 and, therefore, the said issue should not interfere in the decision making - Impugned order set aside: CESTAT
- Appeal allowed: ALLAHABAD CESTAT
CENTRAL EXCISE
2018-TIOL-2529-HC-MAD-CX + Case Story
CCE Vs Sree Saradhambal Automobiles Pvt Ltd
CX - Reversal of CENVAT credit before utilization - rule 14 of CCR, 2004 unambiguously warrants payment of interest - Revenue appeal allowed: High Court [para 3, 4]
- Appeal allowed: MADRAS HIGH COURT
2018-TIOL-3655-CESTAT-HYD
Indofab Engineers Vs CC, CE & ST
CX - The assessee is a manufacturer of brass rods, brass tubes, industrial valves and valves for LPG cylinders and availing CENVAT credit of Central Excise duty on the invoices; on fool proof investigation by DGCEI, issued SCN alleging that assessee had availed CENVAT credit on invoices issued by M/s Annapurna Impex Pvt. Ltd. without actual receipt of material - There is no findings on contention of assessee as to why M/s Annapurna Impex Pvt. Ltd., were not issued SCN for the complicity in passing of ineligible CENVAT credit or why the amount which have been debited by said M/s Annapurna Impex Pvt. Ltd., is to be considered as duty - It is also noticed that First Appellate Authority has selectively considered the statements of various individuals of assessee but has not consider the factual position arising out of holistic reading - The First Appellate Authority has discarded the detailed findings of Lower authorities without indicating as to how the Revenue Authorities prove the case against assessee - Due to various gaps in impugned order, the issue cannot be decided by the Tribunal with reference to the correct facts of the case - In the case in hand, the First Appellate Authority has not recorded to demolish the factual findings of Adjudicating Authority - Accordingly, the impugned order is set aside and without expressing any opinion on the merits of the case, leaving all the issues open, the matter is remitted back to the First Appellate Authority to reconsider the issue afresh: CESTAT
- Matter remanded: HYDERABAD CESTAT
2018-TIOL-3654-CESTAT-KOL
Diamond Beverages Pvt Ltd Vs CCE
CX - The assessee is engaged in manufacture of syrups and beverages - SCN was issued for period from April, 1999 to December, 2003 alleging that value of cups and carbon dioxide (Co2) and also the maintenance charges of vending machines have not been included in transaction value of the syrup and as such there had been undervaluation and suppression with intent to evade payment of duty - The assessee is supplying beverages to various retail outlets for the manufacture of aerated water at the vending machines - The vending machine was obtained by retail vendor first and thereafter the vendor purchased the syrup, carbon dioxide and cups, as the case may be - The Adjudicating Authority failed to appreciate that it was the choice of vendor whether or not to obtain the vending machine - It was only if a vendor obtained the vending machine that he thereafter required the syrup, carbon dioxide and cups, as the case may be - The Commissioner erred in holding that the cups, carbon dioxide and the vending machine were essential for the marketability or marketing of the syrup or promoted sale of the syrup - The cups and carbon dioxide were not manufactured by assessee - They purchased the cups and carbon dioxide from manufacturers and/or from the market and merely resold the same to the retail vendors - Because the cups and carbon dioxide were assessee’s trading items, it did not take any cenvat credit upon purchase thereof - The assessee had separate prices for the cups and carbon dioxide which were sold to only those vendors who wanted the same - The sale of the cups and carbon dioxide for separate price had nothing to do with the sale of the syrup or the sale price of the syrup which was the same for all the vendors irrespective of whether they purchased any cups or carbon dioxide from assessee - The separate price charged for the trading goods, namely, cups and carbon dioxide cannot be included in value of the syrup - The Annual Maintenance Charges relating to vending machines is not includible in assessable value of syrup - The assessee is not mixing the Co2 gas with beverage and cleared the aerated water produced only at the vending machine - According to Revenue, beverage syrup is not marketable - Therefore, if it is not marketable, it is also not excisable - In that case there is no question of adding Co2 gas and cost of AMC charges in assessable value of syrup - In these circumstances, no merit found in the impugned order and same is set aside: CESTAT
- Appeal allowed: KOLKATA CESTAT
CUSTOMS
NOTIFICATION
ctariff18_079
CBIC amends Customs Tariff Notification No 52/2003 to substitute various conditions relating to wastage during manufacture of jewellery articles
dgft18pn056 Change in Appendix 1A of Foreign Trade Policy, 2015-20-reg
CASE LAWS
2018-TIOL-2534-HC-DEL-CUS
Annabelle Analista Malibago Vs DRI
Narcotics Drugs and Psychotropic Substances Act, 1985 [NDPS Act] - Appellant in appeal against the impugned judgment convicting her of having committed the offence contemplated by section 21(c) of the NDPS Act, as well as the consequential order, sentencing her to rigorous imprisonment for ten years and fine of Rs.1 lakh, with default simple imprisonment of one month.
Held: A holistic reading of the decision in the case of Mohan Lal - 2018-TIOL-381-SC-CUS leaves no manner of doubt that the Supreme Court has disapproved, in cases relating to prosecution under the NDPS Act, not only the informant being the IO, but also the complainant, the officer who apprehends the accused, or the officer who conducts the search, being the IO - the Supreme Court has clearly expressed a view that, if the person making the allegations is himself asked to investigate, serious doubts would arise with regard to his fairness and impartiality - while limiting the earlier judgement in Megha Singh [(1996) 11 SCC 709], the Supreme Court also held that the complainant could not be the IO, and that such a practice was inherently pernicious in nature - Rajangam [(2010) 15 SCC 369] which arose under the NDPS Act, also stated that the officer who apprehended the accused could not have investigated the case - the judgment of the Single Judge of the Kerala High Court in Naushad [2000 (1) KLT 785], which stands affirmed by the Supreme Court in Mohan Lal, too, affirms the same view - given the law now enunciated by the Supreme Court in Mohan Lal, which, in view of the mandate of Article 141 of the Constitution of India, has to be regarded as the law that existed for all times, it is clear that the entire investigation and consequent trial and conviction of the appellant, in the present case, stands vitiated by the sole fact of PW-1 Anju Singh being herself the complainant as well as the IO - for the above reasons, the appellant is entitled to be acquitted of the offence for which she stands convicted - the appeal is accordingly allowed - the appellant would be entitled to be released forthwith unless her detention is required in connection with any other case : HIGH COURT [para 14, 18, 19, 20, 21]
- Criminal Appeal allowed: DELHI HIGH COURT
2018-TIOL-3656-CESTAT-DEL
CC Vs Transworld Cargo And Travels
Cus - The respondent-assessee is engaged as a CHA - During the period of dispute, its license had been revoked under the provisions of the CBLR - Subsequently, the adjudicating authority revoked such suspension.
Held: Considering the Tribunal's decision in CC, New Delhi Vs. M/s Sunrise Freight Forwarders Pvt. Ltd. it is seen that the Revenue cannot contest an order of the adjudicating authority passed under the CHALR - The right to file an appeal before the Tribunal against such an order is vested with the CHA only, under Regulation 21 or 23 of CHALR - Hence the present appeal is not maintainable: CESTAT
- Revenue's appeal dismissed: DELHI CESTAT
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