I-T - Policy framed by CBDT for speedy disposal of pending tax cases cannot be declared as arbitrary, simply because certain targets for tax collection are set out therein: HC

I-T - Transfer of going concern would not amount to 'reconstruction' of business and hence, would not affect continued benefit availed by concern u/s 10A: HC

2019-TIOL-1140-CESTAT-DEL

Jajoo Surgiicals Pvt Ltd Vs CCE

CX - During the period under consideration, assessee was engaged in manufacture of Absorbent Cotton Wool IP, Gauze/Bandage Wool I.P, Absorbent Cotton B.P., Purified Cotton USP, Cotton Gauze Absorbent B.P., Absorbent Lint IP, Rolled Bandages, Cotton Bandages Cloth and Cotton Crepe Bandage B.P. - On the basis of information, the Department came to know that assessee have classified 'Absorbent Cotton Wool IP' under Tariff Heading No. 56012110 and availed exemption from payment of Central Excise Duty claiming as 'Textile & Textile Articles' under Notfn 30/2004-CE - Accordingly, a SCN demanding duty, penalty and interest was issued - An identical issue has come up for consideration before the Tribunal in case of M/s Shanti Surgical Pvt. Ltd. & Ors. 2017-TIOL-2153-CESTAT-ALL - By following the earlier decision and considering the totality of the facts and circumstances of the case, impugned order is set aside: CESTAT

- Appeal allowed : DELHI CESTAT

2019-TIOL-1139-CESTAT-KOL

Nezone Strips Ltd Vs CCE

CX - The assessee is engaged in manufacture of CR Strips, Precision Pipes and Tubes classifiable - They availed credit on input service including Good Transport Agency Service - A SCN was issued alleging that credit of Service Tax paid on outward freight on goods cleared from factory to the customer's premises i.e. beyond the place of removal, is not admissible in terms of definition of 'Input Service' - The issue is now well covered by decision of Supreme Court in case of Vasavadatta Cements Ltd 2018-TIOL-90-SC-CX - The decision of Supreme Court in case of M/S. The Andhra Sugars Ltd. 2018-TIOL-45-SC-CX has also decided the issue in favour of the assessee - By respectfully following the ratio as laid down by Supreme Court, the impugned Order is set aside: CESTAT

- Appeal allowed : KOLKATA CESTAT

2019-TIOL-903-HC-DEL-CUS-LB

Gillette India Ltd Vs CC

Cus - Absolute ‘vesting' of the confiscated goods - Government is free to retain the excess auction sale proceeds after adjustment of dues and is under no obligation to return excess amount to importer: Delhi HC Larger Bench

Facts: Sections 118, 119, 120, 121, 122, 122A, 124, 125, 126, 150 of the Customs Act, 1962 - Question referred to the Larger Bench is - Notwithstanding that an importer may not have made the payment of the redemption fine, duty, interest and penalty within the time stipulated in the order of confiscation of imported goods passed u/s 125 r/w s.126 of the Customs Act and which order has attained finality, but makes such payment belatedly but prior to the date of auction, can the Central Government retain the excess auction proceeds after adjusting the customs duty, interest, penalty and redemption fine or has such excess amount have to be returned/paid to the owner of the goods?

Held: Issue would require interpretation of the expression ‘vest with the Central Government' occurring in s.126(1) of the Customs Act, 1962 - Under s.125, an option is given to the importer to redeem the goods by payment of fine and a time limit is also set for that purpose - if, as in the present case, the importer fails to avail of that opportunity, it leads inevitably to confirming the 'confiscation' of the goods and their sale by public auction - it requires the 'officer adjudging confiscation' to mandatorily ‘take and hold possession of the confiscated goods' - once there is a failure to pay the fine within the stipulated period, the consequence is the same, whether the goods are ‘prohibited' or ‘other goods' - transient nature of the confiscation ends and it becomes ‘absolute' - Sections 125 and 126 of the Act form one continuous scheme and are not to be read disjunctively - Once the vesting of the goods in the government is absolute, it would be inconsistent with the character of that vesting that the Central Government can only recover through the sale of such goods, the duty, penalty and interest and should return the excess to the owner/possessor of the goods - section 150 of the Act makes it clear that the legislature has drawn a conscious distinction between what should happen to the sale proceeds when it comes to goods that are confiscated and those that are not - goods that form the subject matter of s.150 are not the improperly imported goods which are liable for confiscation on a collective reading of s.125& 126 - differential treatment accorded to the two kinds of goods is based on an intelligible, rational criteria - objective of s.150 of the Act is for the Government not to recover more than the duty, penalty and interest and which explains the requirement u/s 150(2) for the ‘balance, if any' after adjusting the sums spelt out in clauses (a) to (e) thereunder, to be ‘paid to the owner of the goods' - submission that the same treatment should be accorded to goods that have ‘vested' in the Central Government u/s 126 of the Act overlooks the obvious distinction in the two situations - u/ss 125 & 126 there is no restriction on the use of the auction proceeds following the absolute vesting of the confiscated property with the government - the importer/owner/possessor of the goods loses control over the property thereafter and it logically follows that the government is free to retain the excess sale proceeds after adjusting the duty, interest, penalty, warehousing charges and any other dues - it is trite that the rule of strict interpretation would apply to taxation statutes and there is no equity in tax - It was recognized by the Supreme Court [AIR 1958 SC 845] that the property vests absolutely in the government once a confiscation order was made and it was held that all other rights of any other person in the said property stands extinguished - Division Bench decision in MMTC v. Surjit Singh Kanda [196(2013)DLT725(DB)] holding that the Customs department is precluded from retaining the excess sale proceeds after adjustment of duty, penalty and interest is overruled - Central Government is under no obligation to return the excess amount to the importer - Writ Petition is dismissed: High Court Larger Bench [para 20 to 24, 30, 31, 33]

- Petition dismissed: DELHI HIGH COURT

2019-TIOL-1138-CESTAT-MUM

CC Vs Viraj Impex Pvt Ltd

Cus - Valuation - Commissioner(A) set aside the order passed by the Adjudicating authority and directed that the declared price be accepted as transaction value - Revenue in appeal before CESTAT.

Held: From the case records it is found that the Revenue has failed to establish its claim on the basis of contemporaneous import - major factor which prompted the Commissioner(A) to set aside the adjudication order was that in arriving at the figure of US $460 PMT, the adjudicating authority relied upon the value of import of HR Steel Plates and since HR Coils and HR Steel Plates are not similar, therefore, there was no reason to doubt the truth or accuracy of the value declared by respondent - in the present case, no valid reasons have been recorded by the adjudicating authority for rejecting the declared price/transaction value of HR Coils except the contemporaneous import price of HR Steel Plates, which is not valid - no fault in the impugned order, therefore, Revenue appeal is dismissed: CESTAT [para 11]

- Appeal dismissed : MUMBAI CESTAT

2019-TIOL-1137-CESTAT-MUM

CC Vs Yatin Steels India Pvt Ltd

Cus - Valuation - Section 14 of the Customs Act, 1962 - Adjudicating authority relied upon the value of imported HR Steel Plates but since HR Coils and HR Steel Plates are not similar, therefore, there was no reason to doubt the truth or accuracy of the value declared by respondent - in the present case, no valid reasons have been recorded by the adjudicating authority for rejecting the declared price/transaction value of HR Coils except the contemporaneous import price of HR Steel Plates, which is not valid - no fault in the impugned order, therefore, Revenue appeal is dismissed: CESTAT [para 11]

- Appeal dismissed : MUMBAI CESTAT