2019-TIOL-NEWS-38 Part 2, Dated: Thursday, February 14, 2019

SERVICE TAX

2019-TIOL-482-CESTAT-DEL

CCE & ST Vs Aayojan School of Architecture

ST - The assessee was providing Technical Education i.e. 'Architectural Education' and running an institute in the name of M/s Aayojan School of Architecture, Jaipur - It was alleged in SCN that assessee was offering degree of B.Arch. but not recognized by AICTE and therefore covered under definition of "Commercial Training or Coaching Centre" - It was alleged that the assessee was required to pay Service Tax under taxable service, namely, 'Commercial Training or Coaching Service' - It is not in dispute that said degree B. Arch. is a recognized degree under UGC Act and also recognized by Rajasthan Technical University, Kota; Council of Architecture; and Yashwantrao Chavan Maharashtra Open University - However, the only case of Department is that the said degree is not recognized by AICTE by relying upon the Board Circular 107/1/2009-ST - No infirmity found in impugned order and the same is hereby upheld: CESTAT

- Appeal dismissed: DELHI CESTAT

2019-TIOL-481-CESTAT-DEL

AA And Associates Vs CST

ST - The issue involved is whether the assessee is chargeable to service tax in its activity of working as distributor/marketing agent of M/s Amway India Enterprises Pvt. Ltd. and are getting commission in lieu of providing said services but are not paying Service Tax on commission received from the company - The services of commission/marketing agents are covered under the taxable category of BAS - This resulted into initiation of enquiry under Section 14 of CEA, 1944, as made applicable to Service Tax matters by virtue of Chapter V of FA, 1994 - It appear to Revenue that assessee is liable to pay service tax on commission received for extended - The issue is no longer res-integra and Tribunal have in its judgment in case of Charanjeet Singh Khanuja - 2015-TIOL-1205-CESTAT-DEL have decided the issue - Accordingly, impugned order is set aside and matter remanded to the Adjudicating Authority to decide the SCN denovo after hearing the assessee, pursuing any reply filed or to be filed alongwith evidences, if any, and pass the reasoned order in accordance with law: CESTAT

- Matter remanded: DELHI CESTAT

CENTRAL EXCISE

2019-TIOL-483-CESTAT-MAD

Roca Bathroom Products Pvt Ltd Vs Commissioner of GST & CE

CX - The assessee-company is engaged in manufacturing sanitary wares - It availed Cenvat credit on Landscaping services & Catering services, during the relevant period - The Department claimed that such services were not valid input services as per rule 2(l) of CCR 2004 and so the credit had been improperly availed - Thus the Department alleged contravention of Rule 3 r/w Rule 2(l) of CCR - Duty demands were raised by the adjudicating authority and then sustained by the Commr.(A).

Held: The issue at hand stands settled by the High Court in Wipro Ltd. Vs. Commissioner of C.Ex., Pondicherry wherein both such services were found to be eligible for credit - The rationale behind such decision was that any cost incurred on maintaining the factory premises in an eco-friendly, would eventually form part of the cost of the final products - Regarding eligiblity for credit on outdoor catering service, the issue stands settled by the Tribunal in M/s Reliance Industries Ltd. vs. Commissioner of Central Excise & Service tax, LTU, Mumbai - Hence the credit on both is allowed: CESTAT (Para 2,3,8,9)

- Assessee's appeals allowed: CHENNAI CESTAT

2019-TIOL-480-CESTAT-MAD

Genus Electrotech Ltd Vs Commissioner Of GST & CE

CX - The assessee-company manufactures Electric Table Fans & Domestic Electric Food Mixer - These are supplied to the State Government of Tamil Nadu under rate contract - During the relevant period, the Department observed that the assessee had taken a godown on rent where it stored goods manufactured by it - The Department then alleged that the assessee cleared electric table fans without payment of duty & had stored them in the godown - Also as no permission was taken from the jurisdictional Excise officer, it was proposed to confiscate the goods and impose penalty - On adjudication, the goods were ordered to be confiscated with option of redemption fine being given and the bank guarantee furnished by the assessee was appropriated - Such findings were sustained by the Commr.(A).

Held: The fans are manufactured specifically for the Govt of Tamil Nadu under a State scheme - The goods have no marketability and so cannot be sold in the open market - They can only be cleared as per the directions of the State Govt - Such fans also bear a logo - Hence there is merit in the assessee's contention that clearing such fans to its godown is not an act of fraud, suppression or collusion with intent to evade payment of duty - It is also not the Department's case that the goods were diverted and then sold elsewhere - Removal of goods without prior permission is a procedural lapse & cannot be equated with clandestine removal with intent to evade payment of duty, more so when the goods are not marketable - Hence the quantum of the redemption fine & penalty warrants being reduced: CESTAT (Para 1,4.1)

- Assessee's appeal partly allowed: CHENNAI CESTAT

CUSTOMS

CIRCULAR

dgft18cir019

Discontinuation of physical copy of Advance /EPCG Authorisations issued from 01.03.2019 onwards, for EDI ports

NOTIFICATION

dgft18pn073

DGFT permits import of Groundnut in Shell/Kernels under SION E92

CASE LAWS

2019-TIOL-479-CESTAT-BANG

Bharti Trading Company Vs CC

Cus - Assessee had imported 'ANLU' brand pressure washer pump for household cleaning - The Bill of Entry was filed through M/s. Seven Seas Global Express Logistics Pvt. Ltd. for clearance - On specific intelligence that huge quantity of gold is likely to be smuggled into India by way of concealment in said import consignment, officers of DRI, undertook detailed examination / verification of all 24 carton boxes of said consignment and 120 numbers of yellow coloured metal pieces suspected to be gold were recovered from washer pumps - On verification of same by government approved gold valuer, they were found to be Ten Tola Gold Biscuits of 24 carat / 999 purity each weighing 116.40 gms totaling to 13996.80 gms - The Commissioner (A) has observed in his order that three opportunities of personal hearing were granted to assessee but none of the assessee or their counsel appeared and one of the letter addressed to Sh. Samjad Konari was returned back by observing that they are not staying in said address - Further, assessee was not served the notice of hearing by Department and in reply to the RTI application, Department has stated that personal hearing was fixed on 19/04/2018 or 20/04/2018 and the intimation was given on 11/04/2018 which was never received by assessee - Further, no intimation was given to counsel whose address is given in appeal paper books given to Commissioner - The entire impugned order has been passed in clear violation of principles of natural justice and no hearing was given to assessee or his counsel and the impugned order has been passed ex parte - Therefore, case needs to be remanded to Commissioner (A) with a direction to pass de novo order after complying with the principles of natural justice and after affording an opportunity of hearing and opportunity to produce any evidence which the assessee may produce to defend their case - Consequently, all the appeals are allowed by way of remand to the Commissioner (A) for passing fresh orders: CESTAT

- Matter remanded: BANGALORE CESTAT