SERVICE TAX

2019-TIOL-24-CESTAT-MAD

Ponni Sugars Ltd Vs CCE & ST

ST - The assessee has entered into an agreement with sugarcane growers and for transportation of sugarcanes from the field, as a measure of convenience the assessee arranged trucks for such transportation - The freight was also paid by assessee - It is also seen from record that for such consignments the assessee has assumed the role of GTA and issued the "consignment notes" - In terms of Notfn 32/2004-ST, the liability for payment of tax is cast on the person who is paying the freight - Since the assessee has paid the freight, service tax liability has also been taken over by the assessee - Service tax liability has been discharged only in respect of consignments where the gross amounts charged was beyond the limits specified in Notfn 34/2004-ST - The assessee has assumed the role of GTA as seen from the fact that the consignment notes have been issued by them - Consequently, they will also be entitled to benefit of Notfn 34/2004 wherever the gross amount charged is within the limit specified therein - In any case, the situation of assessee is one of revenue neutrality - It is obvious that any service tax paid will also be available to assessee as an input service credit - The Apex Court has decided in case of Coca-cola India Pvt.Ltd. 2007-TIOL-245-SC-CX that no duty is payable in case the same is available to same assessee as Cenvat credit - The demand for service tax raised by lower authorities cannot be sustained: CESTAT

- Appeals allowed : CHENNAI CESTAT

2019-TIOL-23-CESTAT-MAD

K Rajagopalan And Company Vs CCE

ST - The assessee was issued SCNs demanding service tax on various grounds - As regards to demand raised under works contract service in respect of dedicated water supply scheme to Coimbatore City Municipal Corporation under JNNURM Scheme, this being public utility service and not being for commercial purpose, is not covered under taxable services - In cases of BMS Projects (P) Ltd. 2017-TIOL-2112-HC-AHM-ST as well as Lanco Infratech Ltd. 2015-TIOL-768-CESTAT-BANG-LB the above services held to be not liable to levy of service tax - Following the same, the demand of service tax in respect of these services cannot sustain - In another appeal, apart from the demand on works contract service in respect of hydro power projects, an amount is raised by the department under category of supply of tangible goods service for renting of construction of equipment by assessee to L&T - Evidently, the value of these services being less than Rs. 10 lakhs is exempted under Notfn 6/2005-ST as all other income of assessee falls under exempted services - This demand, therefore, cannot sustain.

Apart from the demand of service tax in respect of hydro power projects, the department has demanded service tax under works contract service for construction of staff quarters for TNEB employees in the power project - The Tribunal in Sima Engineering Constructions has considered the very same issue and held that such services of construction of staff quarters inside the power project is not levy to service tax as per the notifications - The demand therefore cannot sustain.

As regards to demand of service tax made under management, maintenance or repair service on the services rendered by assessee at Periyar Lower Camp and Suriliyar Lower Camp which are both small hydroelectric power projects, these activities being services related to for transmission of electricity will be covered by exemption Notfns 11/2010 and 45/2010 - The decision in case of PES Engineers 2017-TIOL-3162-CESTAT-HYD would apply to the demand of service tax in respect of management, maintenance or repair services in regard to hydroelectric power projects also - Therefore, the demand is set aside - The demand of service tax in respect of all these appeals cannot sustain: CESTAT

- Appeals allowed : CHENNAI CESTAT

2019-TIOL-19-CESTAT-HYD

Vishwa Infrastructures And Services Pvt Ltd Vs CC, CE & ST

ST - The assessee is a manufacturer of pipes, which they supplied to various projects and they have entered into works contract agreement with water supply and sewage systems of the Government Departments and also local municipalities - These contracts are composite services which involved sale in goods together with rendition of associated services and hence there is no dispute that they are in the nature of works contracts - The question to be decided is whether the contracts entered by assessee should be classified as construction of a pipeline primarily for non- commercial or non-industrial purposes or as turnkey/EPC projects including engineering or commissioning (EPC) projects - The decision of Larger Bench in case of Lanco Infratech Ltd. 2015-TIOL-768-CESTAT-BANG-LB is identical to the dispute in hand - Respectfully, following the decision of Larger Bench of CESTAT and hold that the work done by assessee in the nature of turnkey/EPC projects for Governments with respect to laying of pipes for water supply/sewerage is covered by explanation (ii)(b) of Section 65 (105) zzzza and is not exigible being not for commerce or industry - Consequently, demand of interest and penalties are set aside - As far as the appeal of Revenue is concerned, since, the demand itself is not sustainable and the question of eligibility of assessee for benefit of composition scheme becomes redundant - The appeal of assessee is allowed and the impugned order is set aside: CESTAT

- Assessee's appeal allowed: HYDERABAD CESTAT

 

 

CENTRAL EXCISE

2019-TIOL-22-CESTAT-ALL

CCE & ST Vs Shamali Sugar Works Pvt Ltd

CX - The assessee company, engaged in manufacturing MS Ingots, underwent inspection during the period of dispute, whereupon shortage of finished goods & raw materials was detected - The Revenue noticed two induction furnaces - Based on statements taken from certain employees in the assessee's firm, the Revenue alleged that the assessee had indulged in clandestine clearance of goods - Duty demand was raised & penalties were imposed - Such demands were dropped by the Adjudicating authority - Held - The assessee claimed that the goods allegedy cleared clandestinely were MS Ingots which were recorded in the RG-1 register - The RG-1 corroborates such claim - Since the Revenue failed to rebut such claims, the Adjudicating authority correctly dropped the proceedings initiated by the SCN - Revenue's appeal lacks merit: CESTAT (Para 3-7)

- Revenue's appeal dismissed : ALLAHABAD CESTAT

2019-TIOL-21-CESTAT-MAD

Rasi Technitex Pvt Ltd Vs CCE

CX - The assessee company, engaged in manufacturing 100& cotton yarn, availed exemption from duty under Notfn No 29/2004-CE & Notfn No 302004-CE - It availed Cenvat credit of duty paid on components, spares & accessories of capital goods and these were used exclusively to manufacture exempted final products attracting 'nil' rate of duty - Such availment of credit was contested by the Revenue on grounds that it contravened provisions of Rule 6(4) r/w Rule 2(d) of CCR 2004 - Hence duty demand was raised with interest seeking recovery of such credit - Penalties were imposed as well - Rule 6 (4) read with Rule 2 (d) of Cenvat Credit Rules, 2004 - Held - In an issue involving identical circumstances, the High Court in CCE, Chennai Vs. Same Duetz Fahr India (P) Ltd. held that the assessee's case therein fell within the exception carved out in Rule 6(6)(v) of the 2004 Rules - The purpose behind carving out of such exceptions is to neutralise the impact of the duties paid by the exporters, with regard to input tax, whether paid on goods or services - The objective obviously is not to export duties, so as to provide much needed competitive edge to Indian exporter in foreign markets - Following such findings, the demands in the present case are set aside: CESTAT (Para 1,5)

- Assessee's appeal allowed: CHENNAI CESTAT

 

 

 

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IGST Export Refunds - resolution of errors

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