SERVICE TAX

Master Piece Vs CCE & ST

ST - The assessee is registered with the Department for providing 'Commercial or Industrial Construction Service' (CICS) - The assessee is engaged in making false ceiling, partitions, panelling, boxing, applying wallpapers and carpeting - On verification of records for the relevant AY's, the Department was of the view that the activities performed by the assessee would fall under the category of 'Interior Decorator Service' and not under the category of CICS - Accordingly, the Adjudicating Authority confirmed the proposals for classification of the services under 'Interior Decorator Service' and confirmed the demand of service tax amount with interest, and also imposed penalties u/s 77 and 78 - On appeal, the Commissioner (Appeals) confirmed the order of the original authority.

Held: From the sample copies of invoices it was observed that, the activities done by the assessee requires it to source the materials themselves - Further, the work has to be completed as per design and drawing specifications as provided by M/s Gypsum India Ltd. - Therefore, the assessee is nowhere involved even in the design and drawing of the work that has to be done by them - Moreover, the Interior Decorator Service involves provision of advice, consulting technical assistance or services provided by way of intelligence or skill - There is no supply of material envisaged in the provision of services under Interior Decorator Service - Thus, assessee does not fall under the category of Interior Decorator Service - Hence, the order of the original authority is set aside: CESTAT (Para 5)

- Assessee's appeal allowed : CHENNAI CESTAT

Simran International Vs CCE

Pkss Infrastructure Pvt Ltd Vs CST

 

 

 

 

CENTRAL EXCISE

SRF Ltd Vs CGST & CE

CX - During the period of dispute, the assessee availed credit on inputs & capital goods used in the R&D unit - The Department opined that such credit could not be availed as inputs or capital goods used for R&D purposes did not fall within scope of Rule 2(l) of CCR 2004 - Duty demand was raised to recover such credit, with interest - Penalties were imposed as well - Such demands were confirmed by the Commr.(A).

Held: It can be seen from the definition of 'inputs' that the goods brought within the factory used for any purpose would be eligible for credit - Thus, the definition of 'inputs' has a wide ambit so as to cover all goods which have been brought into the factory & are used directly or indirectly in the manufacture of final products - The same has been settled in various precedent cases - Hence the assessee is eligible for credit & denial of the same is unjustified: CESTAT (Para 1.2,1.3,6.1,7)

- Assessee's appeal allowed : CHENNAI CESTAT

Lotte India Corporation Ltd Vs CCE

CX - The assessee-company is a principal manufacturer & engaged job workers to manufacture sugar confectionary items - The assessee provides raw material & machinery to the job workers & pays the job work charges - Besides, the Excise duty paid by the job workers is reimbursed by the assessee - Hence the job worker is more of an agent of the assessee, without there being any principal to principal relationship - The assessee availed credit of service tax paid on transportation of raw material to the job worker's premises & on the transportation of finished goods from the premises of the job worker to the assessee's depot - The Revenue denied such credit on grounds that the assessee was not engaged in manufacturing the goods - Duty demands were raised for reversal of credit & penalties were imposed.

Held: The issue at hand stands settled in the assessee's own case for a preceeding AY, wherein the Tribunal denied the credit - Following such decision, the credit is inadmissible - However, the issue is interpretational in nature & the assessee was under bona fide belief of being eligible for credit - Hence the penalty merits being set aside - However, the duty demands with interest are sustained: CESTAT (Para 2,7)

- Assessee's appeal partly allowed : CHENNAI CESTAT

Hindustan Coca Cola Beverages Pvt Ltd Vs CGST & CE

CX - The assessee-company is a leading producer of non-alcoholic beverages - During the relevant period, it availed Cenvat credit on pest control services & management consultancy service - The Revenue disallowed the credit claimed - Hence the present appeal.

Held: Regarding the denial of credit on pest control services, the assessee rented premises outside the factory for storing input goods, such as Sugar - It availed pest control services to ensure that the premises remained free of pests - As the Sugar is used to produce aerated beverages meant for human consumption, it is necessary that the premises remain free from pests - Hence pest control service is valid input service & are eligible for credit - Regarding denial of credit on fees paid by assessee for site visit of CII officials, the visit was made regarding National Award for Food Safety, 2014 - It is also seen that neither had the not requested for any management consultancy & the purpose of the visit is to present an award to the assessee - Hence the same cannot classify as an input service - Thus the credit was rightly disallowed - The appeals are allowed in part: CESTAT (Para 2,5.1,5.2)

- Assessee's appeals partly allowed : CHENNAI CESTAT

 

 

 

 

CUSTOMS

NOTIFICATION

ctariff19_004

Seeks to further amend Notification No. 08/2016- customs dated February 5, 2016 to allow temporary importation of aircrafts, for the purposes of participation in Aero Show organised by the Central Government, without furnishing a bank guarantee or cash deposit.

CASE LAWS

2019-TIOL-314-HC-ALL-CUS + Case story

CC Vs Shakil Ahmad Khan

Cus - Smuggling of gold - Section 110, 111, 112, 123, 138B - Retracted statement - It would be inappropriate to base the conviction of appellant purely on the statements of co-accused - No efforts were made by the appellant Revenue to prove that the confessional statements were made voluntarily - No Customs Officer or any independent witness was examined by the said authority which could prove that the said confessional statement was taken voluntarily and could be used as a substantial piece of evidence against the respondents - It is clear that a confessional statement of a co-accused cannot, by itself, be taken as a substantive piece of evidence against another co-accused and can, at best, be used or utilized in order to lend assurance to the Court - In the absence of any substantive evidence it would be inappropriate to base the conviction of the appellant purely on the statements of co-accused - no infirmity in the order of the Tribunal - Revenue appeals dismissed: High Court [para 19, 21, 24, 25, 26]

- Appeals dismissed : ALLAHABAD HIGH COURT

Edelweiss Metals Ltd Vs CC

Cus - The assessee imported Gold dore bars during the relevant AY & availed exemption under Notfn No 12/2012-Cus - The Revenue issued an SCN alleging that the goods had been produced by a company which operated as a copper smelter & refinery & not as a mining company or laboratory attached to the mining company - It was further alleged that the Gold dore bar was by-product of the smelting process - It was also alleged that the packing list was not enclosed with the goods & that the assaying of the Gold was done by the metallurgical laboratory division of the smelter & that such entity was not a mining company - Hence the Revenue alleged that the conditions of Notfn No 12/2012-Cus were not satisfied & so the assessee was ineligible to receive benefit thereof - Demand for differential duty was raised with interest u/s 28A, the goods were confiscated & penalties were imposed u/s 111(d), 111(m) & 112(a) of the Customs Act.

Held: It is common nature for economic activities to be divided between various subsidiaries of one parent company - It is seen that the producer of the gold is the subsidiary of a larger entity which is engaged in mining copper concentrate, which is refined & smeltered by the subsidiary - Merely because both are working under different set up, this does not imply that the subsidiary smelter is not part of the parent mining company - Thus the different set up is only an artificial difference & there is no distinction between the two entities - The packing list was issued by the smelter since it was engaged in producing the Gold dore bar - The assay certificate was issued by the parent unit since it had mined the ore - Hence the conditions of Notfn No 12/2012-Cus have been fulfilled - Moreover, the assay certificate cannot be denied on grounds that it is a provisional one - The conditions of the notifications should be construed liberally & should not be so read as would defeat the purpose of the notification - Hence the assessee is eligible for benefit under this notification & the demands merit being set aside: CESTAT (Para 1,6,7,8)

- Assessee's appeal allowed : AHMEDABAD CESTAT

PCI Ltd Vs CC