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SERVICE TAX
ST - This appeal seeks to assail the order passed by Commissioner, Central Excise, Jaipur in response to declaration of tax dues made by assessee under Service Tax VCES, 2013 which came into effect from 10 May, 2013 - The assessee submitted an application under 2013 Scheme of 28 June, 2013 in respect to which an acknowledgement of declaration was issued by department on 2 July, 2013 - The assessee also deposited an amount which was 50% of tax dues on or before 31st December, 2013 and deposited the remaining 50% also - It is true that assessee did not file a proper reply to SCN to explain the position nor the assessee availed the opportunity provided to it to appear in person and explain the correct position - However, from the submissions made by assessee and the documents that have been brought on record in the appeal, it would be appropriate to remand the matter to Commissioner for a fresh adjudication - The submission of assessee is that no service tax was liable to be paid for financial year 2009-2010 and for this reason the tax for this financial year was not mentioned in the declaration and that it was not the liability of the assessee to pay service tax on additional amount mentioned in SCN - It needs to be noted that Annexure A to the SCN contains a note that service tax had been calculated on entire ticket value to safeguard Government revenue instead of on basic fare on domestic and international ticket bookings as no separate figures of basic fare in domestic and international booking were available on the record - Assessee had calculated the tax on basic fare, whereas the SCN seeks to charge tax on entire ticket value - The assessee is, therefore, permitted to file an additional reply to SCN with supporting documents within a period of six weeks and if assessee desires a personal hearing, the same may be given - However, as the assessee have failed to file a proper reply to SCN and even failed to appear in person, it deems fit and proper to impose a cost of Rs. 50,000/- on assessee, which the assessee shall deposit within a period of one month in the Prime Minister's Relief Fund: CESTAT
- Appeal allowed : DELHI CESTAT
ST - The assessee had entered into an agreement with National Highways Authority of India (NHAI) in 2001 and rendered services to them - On verification of records, it was observed that NHAI had paid Income Tax (TDS) to the Government of India on behalf of assessee and the same was not included for discharge of service tax by assessee - A SCN was issued to assessee for recovery of differential Service Tax on the amounts paid by NHAI as TDS and interest was also demanded in addition to proposals for imposition of penalties - There is no dispute as to the fact that the agreement entered by assessee with NHAI wherein the liability to discharge/ deduct the income tax from the consultant, sub-consultant and personnel was on the part of NHAI which they have complied with and it is also undisputed that assessee had received the amount of consideration of contract and discharged service tax liability on such an amount - The contention of assessee that they had charged fully for the services rendered and the invoices raised also indicate the discharge of service tax liability on total consideration agreed, has overlooked the provisions which indicate that "gross amount charged is for such services" - Undisputedly, the TDS deducted by NHAI and paid on behalf of assessee is the amount received for services rendered as amount of TDS which has been paid by NHAI gets reflected as income in the books of assessee - It is undisputed that assessee has no other income other than amounts received as consideration from NHAI - If that be so, the amount of tax deducted and paid is shown as income and is directly related to the contract entered by assessee with NHAI, it can be said that the amount of TDS is charged by assessee to NHAI for services rendered and is definitely liable to the service tax - Applying the ratio of judgment in case of Bhayana Builders Pvt Ltd - 2018-TIOL-66-SC-ST , it can definitely be said that TDS amount paid by NHAI into the Government Treasury on behalf of the assessee was an amount paid towards consideration for the services rendered - The impugned order is correct and no interference is called for - As regards to limitation, assessee has also not been able to make out a case on limitation for simple reason that despite showing TDS amount as income in his balance sheet, did not indicate the same or reconcile figures with the service tax returns filed by them and revenue had to come out with the figures on verification of the records itself indicates that there was suppression of facts - The appeal is devoid of merits and stands rejected: CESTAT
- Appeal rejected : HYDERABAD CESTAT
CENTRAL EXCISE
CX - The assessee is engaged in manufacture of MS ingots, Cast iron moulds, as capital goods, are used to produce the said ingots - The Department alleged that the assessee is removing scrap of old and used moulds under job work challans so as to evade the payment of central excise duty - It was observed that the said job worker was actually supplying sufficient moulds to the assessee in the name of goods being returned under job work challans after reprocessing/ repairing - The allegations against assessee have been confirmed only for want of such undertaking - The Apex Court in case of Sambhaji- 2009-TIOL-79-SC-MISC has held that a procedural prescription is a lubricant and not a resistant in the administration of justice - Constitution Bench of Supreme Court in a prior decision in case of Rajabuland Sugar Company Ltd. has held that the question whether a particular provision is mandatory cannot be resolved by laying down any general rule and it would depend upon the facts of each case - For that purpose, the objective of statute in making out the provision is the determining factor - CBEC clearly says that merely procedural lapses be not allowed to defeat the modvat credit benefit, if substantive conditions about payment of duty and user of goods in manufacture of end product in factory are fulfilled - It was held that however substantial benefit should not be denied for the procedural valuation if substantial liability has been complied with - There is sufficient compliance by assessee qua the substantial liability as laid in the Notification relied upon is concerned - Mere lack of sending an intimation is a procedure which is mere directry - Denying the substantial benefit to assessee on merely a procedural lapse is unjustified on the part of the adjudicating authority below - The assessee was not liable to make the payment of duty in view of the exemption vide Notfn 67/95 qua the capital goods consumed in captive use after being reprocessed - Resultantly, there appears no alleged mensrea on the part of assessee to evade duty - The impugned SCN has invoked the extended period of limitation - The demand is therefore held time barred, at least till August 2013 - With respect to the subsequent smaller period of demand, the demand is held not sustainable - The findings of Commissioner (A) are therefore held erroneous: CESTAT
- Appeal allowed : DELHI CESTAT
CX - The assessee is a manufacturer of clutches and having another unit(unit-I) for the manufacture of same products - Assessee procured goods in two ways (i) from their Unit-I and (ii) from other vendors - Finished clutch assemblies manufactured and supplied by other manufacturers were also received by assessee in bulk packings on payment of duty under Section 4 of CEA, 1944 - In such cases, they repacked these goods into retail packs, affixed MRP price thereon and cleared them on payment of duty by adopting price under Section 4A ibid - Department took the view that goods received from Unit-I was merely for logistics purpose and did not qualify as an 'input' for the assessee since they did not undergo any deeming manufacturing activities such as packing / re-packing, labelling/ re-labelling, affixing of new MRP labels; that the activity carried out by appellant on such goods did not fall within the ambit of 'manufacture' as defined in Section 2(f) of the Act - Even before issue of SCN, the assessee vide their letter submitted details of payment of duty on goods received from Unit-I and cleared by them for home consumption, payment of duty on goods manufactured (repacking, relabeling etc.) by assessee and cleared for home consumption and debit on MISC payments - SCN was later on issued on 31.08.2012 - The personal hearing was held on 16.11.2012 - Pursuant to personal hearing, vide a letter dt. 23.11.2012, the assessee have conveyed to the adjudicating authority, details of Rs.11,54,59,277/-, reversed / paid as and when materials were removed, details of duty paid and credit reversed in the manufacturing as well as removals as such and credit not reversed due to exports - While the assessee have given the data, it is not clear therefrom as to what quantum of goods were subjected to processes amounting to 'deemed manufacture' and / or on which M.R.P was revised upwards resulting in discharge of differential duty liability - So also, the data with regard to clearances of inputs as such by reversing cenvat credit availed thereon under Rule 3 (5) ibid has also not been separately indicated - On the other hand, in respect of both these clearances combined information has been given in the statement submitted by assessee to the Commissioner in their letter dt. 23.11.2012 and also in their reply to Range Superintendent vide letter dt. 30.11.2012 - The matter requires to be remanded to the adjudicating authority for de novo consideration - In such de novo proceedings, the appellants will be required to submit detailed information regarding each type of clearances made as claimed by them - So also, in respect of exports of the impugned goods made by assessee there need not be any corresponding reversal of cenvat credit - The adjudicating authority should take note of Board's instructions contained in Circular 283/117/96-CX wherein it has been clarified that credit against export of inputs as such under bond can be utilised in the same manner as it is provided for a final product and that such input should be allowed to be exported under bond without any reversal of the credit - Coming to penalty, entire dispute pertains to interpretation of the provisions relating to 'deemed manufacture' and in particular, the eligibility to avail cenvat credit on goods - Penalty of Rs.11,54,59,277/- and Rs.90,85,559/- imposed under Rule 15 of CCR, 2004 / Section 11AC of the Central Excise are uncalled for: CESTAT
- Appeal partly allowed : CHANDIGARH CESTAT
CUSTOMS
Cus - The disputed duty involved in these cases is below the monetary limit of Rs.10 lakhs which has been notified by the Government vide Circular No. 390/Misc./163/2010-JC and F.No. 390/Misc./116/2017-JC - Accordingly, the appeals are dismissed under litigation policy - Stay Petitions also get disposed off: CESTAT
- Appeals dismissed : KOLKATA CESTAT
Cus - The assessee have filed an application for restoration of appeal which came to be dismissed by this Bench vide Final Order dated 06.09.2000 on the grounds that the Committee of Secretaries has not granted permission to assessee to pursue the appeal - However, the Bench has given the liberty to seek restoration as and when the Committee of Secretaries them clearance - Assessee submits that COD clearance has since been obtained on 02.03.2010 as per the clearance given by COD to restore the appeal and proceed to hear the matter - The issue is no longer res integra and has been squarely settled by Supreme Court in case of MRPL - 2015-TIOL-199-SC-CUS - The Supreme Court has concluded categorically that assessment is to be done on the basis of quantity of crude oil actually received in shore tanks in the Port of arrival in India: CESTAT
- Appeal allowed : BANGALORE CESTAT |
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