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SERVICE TAX
2019-TIOL-1287-CESTAT-MAD
Aspinwall And Company Ltd Vs CGST & CE
ST - The appellant company is registered for providing services taxable under Port Services, Customs House Agent and Technical Inspection and Certification Services, Steamer Agent Service and Goods Transport Agency Service - It availed Cenvat credit of service tax paid on input services & utilized the same for paying service tax on the output service - The service tax on GTA service was paid by the appellant by availing 75% abatement - Scrutiny of accounts revealed that the appellant paid service tax under GTA on transportation income minus bulk income - It was noted that the appellant paid service tax under GTA on the whole amount received from customers - However, the difference between the amount received from the customers and the actual amount paid to the vehicle owners as hiring charge for the vehicles hired in which the goods were transported is the margin money - The Revenue opined that such margin money was not classifiable under GTA & was taxable under BAS instead - SCNs were issued proposing duty demand - On adjudication, duty demands were raised with interest & penalties u/s 76, 77 & 78 of the Finance Act, 1994 - Hence the present appeal.
Held: It is seen that the customers to whom the appellant provided GTA service had no knowledge as to whether the appellant rendered service of transport of goods by using their own vehicles or by using the vehicles hired from other vehicle owners - Hence the Revenue's allegation that the extra amount is collected for procurement of services for their customers in factually incorrect - Besides, the appellant availed 75% abatement as is legally allowed for GTA service - Service tax has also been paid on the amount collected for transportation of clients' goods - Hence the Revenue's argument of such activity being classifiable under BAS is untenable - The extra amount collected by providing service of transportation of goods can also not be categorized under BAS - When the extra amount is collected in relation to transportation of goods, the appellant cannot be faulted with for including it under taxable value of GTA service - Hence there are no ingredients to establish suppression of facts with intent to evade payment of service tax - The duty demands with interest & penalties merit being quashed: CESTAT (Para 2,9,10,11)
- Assessee's appeal allowed : CHENNAI CESTAT
2019-TIOL-1286-CESTAT-MAD
Ambika Cotton Mills Ltd Vs CGST & CE
ST - The appellant company manufactures Cotton Yarn - It engaged the services of transporters to move the cotton yarn manufactured - The appellant did not pay service tax as a recipient of Goods Transport Operators Service during 16.11.1997 to 1.6.1998 - An SCN dated 30.08.2001 was issued proposing duty demand u/s 73(a) of Finance Act 1994 along with interest & penalties u/s 76 & 77 of the Act - The appellant filed writ petition against the letter issued by the Department, claiming that the service recipient could not be made liable to pay tax - Such issue reached the Apex Court in the case of Laghu Udyog Bharati Vs. Union of India wherein it was held that the service recipient could not be made liable to pay tax and the provisions in this regard were ultra vires - Later, the Finance Act 2000 brought retrospective amendments and the Finance Act 2003 brought further amendments to validate recovery of service tax - Hence SCNs were issued in 2004 raising demand for the earlier period covered in the earlier SCN - On adjudication, the duty demands were raised with interest - These were sustained by the Commr.(A) - Hence the present appeals.
Held: It is inexplicable as to how the Department withdrew the SCN and issued a fresh SCN for the very same period - Such issue stands resolved by the Larger Bench decision of the Tribunal in Agauta Sugar & Chemicals vs. Commissioner of Central Excise, Noida - The only allegation made in the fresh SCN is that the appellant did not file returns or pay service tax - When there is no liability upon the service recipient, the appellant could not have been expected to file returns or pay tax - No act of suppression has been brought out from the facts and evidence - Hence the ingredients for invoking extended period of limitation are not satisfied & the duty demanded is unsustainable: CESTAT
- Assessee's appeal allowed : CHENNAI CESTAT
CENTRAL EXCISE
2019-TIOL-1008-HC-MUM-CX
CCT Vs Amforge Industries Ltd
CX - Respondent engaged in manufacture of Forging & MV Parts - Discrepancy in stock - Internal Auditor explained that the reasons for inflated book stock are that the production department wanted to show higher production to achieve their targets; that even those items which were not approved by the Quality Control department and were scrapped, these items were not reduced from book stock - alleging clandestine manufacture and removal of finished goods, SCN was issued - respondent deposited duty of Rs.1.06 crores along with interest - Commissioner confirmed the demand and imposed equivalent penalty - Tribunal referred to the fact that neither there was any physical stock taking done by the Revenue nor any panchanama drawn to record the shortages alleged; that there was no evidence of clandestine removal and that the Internal Auditor had explained the reasons for the shortage - relying upon the decision in Nexo Products (India) - 2015-TIOL-1829-HC-P&H-CX , demand was set aside and appeal was allowed - Revenue in appeal before High Court.
Held: Shortage has been explained by the Internal Auditor - No actual stock taking was done and in view thereof, there is no reason to disbelieve the statement of the Internal Auditor - Charge of clandestine removal is a serious charge and must be supported by evidence and which is completely lacking in the present case - View taken by the Tribunal on the facts before it, is a possible view - no substantial question of law, therefore, appeal is not entertainable - appeal dismissed: High Court [para 7, 8] -
Appeal dismissed
: BOMBAY HIGH COURT
2019-TIOL-1290-CESTAT-AHM
Meghmani Organics Ltd Vs CCE & ST
CX - The assessee was working as 100% EOU and have de-bonded their unit and exit from their 100% EOU status - At the time of de-bonding, they have paid duty on all the excisable goods and imported goods - In case of imported goods, in addition to other duties, they have paid SAD in Terms of Notfn 19/06-Cus - They availed the cenvat credit of SAD - The case of department is that since the goods were exempted under Notfn 23/03-CE unconditionally, therefore, the assessee should not have paid the SAD and consequently they were not entitled for cenvat credit - The assessee have admittedly paid the SAD without availing any exemption notification by virtue of Notification No. 19/03-Cus dated 01.03.2003, therefore, on this ground itself they are eligible for cenvat credit - Secondly, even if it is assumed that the goods is exempted under notfn 23/03-CE, it has been held by Coordinate Bench of Tribunal in case of Century Yarn that Notfn 23/03-CE is not applicable in the case of de-bonding, therefore, there is no question of applicability of Notfn 23/03-CE - Hence, the impugned order is set aside: CESTAT
- Appeals allowed : AHMEDABAD CESTAT
2019-TIOL-1289-CESTAT-AHM
Kedar Metals Pvt Ltd Vs CCE & ST
CX - This appeal has been filed by assessee against imposition of penalty of Rs. 50,000/- - In view of the decisions in case of Kakateeya Fabs (P) Limited - 2017-TIOL-2792-CESTAT-DEL and Apple Sponge and Power Limited - 2018-TIOL-1591-CESTAT-MUM , no penalty on a Private Limited Company under Rule 26 (1) of CER, can be imposed - Revenue has not produced any contrary decision - Therefore, penalty imposed under Rule 26 is set-aside: CESTAT
- Appeals allowed : AHMEDABAD CESTAT
CUSTOMS
PUBLIC NOTICE/ NOTIFICATION
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Govt amends Import Policy conditions for Electronics & IT goods
dgft19not004
Supply of essential Commodities to the Republic of Maldives during 2019-20
dgft19pn007
Amendments in the ANF 3D notified on 05.02.2019
dgft19pn006
Amendment in the ANF 3B notified on 28.06.2018 for claiming SEIS benefits under the FTP 2015-20 CASE LAWS
2019-TIOL-1305-CESTAT-MUM
Jindal Waterways Ltd Vs CC
Cus - Goods viz. Dry containers imported are not prohibited goods or subjected to any import restrictions in terms of Custom Act, 1962 or under any other law for time being in force, hence clause "d" to Section 111 is not applicable - Similarly, the goods were assessed to duty by the Custom Authority and cleared on payment of duty assessed - Therefore, there cannot be misdeclaration when there is no dispute that the entries made in the Bill of Entry were on the basis of an invoice of foreign supplier - no allegation that the invoice was forged or manipulated and hence clause "m" of Section 111 will not be applicable - So also, when the appellants have followed the practice in manner of making the declarations in Import Manifest, and existence of such practice is admitted by the Commissioner JNCH, Nhava Sheva, in his Public Notice, case of appellants cannot be covered under clause "f" of Section 111 - Order of Commissioner holding goods liable under Section 111 (d) (f) and (m) is bad in law and cannot be sustained - since imported dry containers are not liable for confiscation under Section 111, penalties under Section 112 (a) and (b) (iii) cannot be sustained and hence they are set aside: CESTAT [para 5.6, 5.7]
Cus - Valuation - Section 14 of Customs Act, 1962 - Customs Valuation Rules, 2007 - Value has been determined by the Commissioner on the basis of replacement cost agreed between Appellant 1 and Appellant 2 - Since the replacement cost represents the intrinsic value of container, agreed upon between the lessor and lessee in the one way lease, the same is basis of value - As the Commissioner has given adequate reason for discarding the invoice value, Bench does not see any reason for interfering with the findings recorded by Commissioner - Demand of duty and interest upheld: CESTAT [para 5.3, 5.4, 5.8]
- Appeals disposed of: MUMBAI CESTAT
2019-TIOL-1304-CESTAT-MUM
CC Vs Udit Seth
Cus - Commissioner (Appeal) has determined the value after discussing the evidences produced before him and has in a reasonable manner arrived at the conclusions drawn by him - Revenue has in their appeal not stated why the conclusions arrived by the Commissioner (Appeal) are incorrect or the why the evidences produced before him and relied upon by him cannot be considered - In absence of any averments in the appeal discarding the evidences relied upon by the Commissioner (Appeal) Bench does not find any merit in the submissions made by the revenue: CESTAT [para 5.4]
Cus - Issue raised in the appeal by the revenue has been raised for first time in appeal without the same being subject matter of adjudication proceedings or in appellate proceedings before the Commissioner (Appeal) - In case revenue was aggrieved by adjudicating authority not proposing to add certain charges to arrive at the assessable value, the correct course would have been to file appeal or cross objections before the Commissioner (Appeal) - Since revenue has proceeded not to file any appeal/ cross objections before the Commissioner (Appeal), they could not have taken this ground for first time while filing the appeal before the Tribunal: CESTAT [para 5.5]
Cus - Enhancement of redemption fine without determining the market value of goods and the duty payable cannot be sustained: CESTAT [para 5.6]
Cus - Import of Harley Davidson Motor Cycle - Bill of Entry dated 28.01.2009 - As the respondents have submitted that they are no more interested in redeeming the said vehicle since the goods would have, by now, become junk, issues raised by the revenue in their appeal have become of academic interest - Revenue appeal disposed of: CESTAT [para 5.2, 5.7, 6.1]
- Appeal disposed of: MUMBAI CESTAT
2019-TIOL-1288-CESTAT-AHM
Dhanistha Gold Vs CC
Cus - The officers intercepted Skoda car which was coming from Mumbai to Ahmedabad - The occupants of the car were Shri Nitin Bherumal Jain, Proprietor of M/s Dhanishtha Gold, Shri Mukesh Menon, Smt. Seemadevi Bherumal Jain his mother and Smt. Seema Satish Mehta his maternal aunt - Shri Nitin Jain revealed that they were carrying 2.5Kgs of Gold and Rs. 15 lakhs of demonetized notes - That the said gold was to handed over to Shri Utsav Modi of M/s PGP Joyeria a Jewellery shop located in Ahmedabad and he was on the way to meet him at Vishala Circle - As regard seizure of two gold bars i.e Valcambi – Suisse of 995 purity having Serial No. AU 57452 and Serial No. AG190942, assessee had produced all the purchase related documents before the investigating officer as well as to the adjudicating authority - The documents included Notional rate certificate issued by M/s Diamond India Ltd at the time of export of goods by M/s Dhanishta, invoice issued by assessee for export of goods containing details of said NRC - It is also a fact that the assessee had procured gold after discharging their export obligation and therefore the confiscation of gold on the ground that the assessee has not discharged their burden of showing legal acquisition of gold is not sustainable - In case of confiscation of 1000.009 gms of gold, the ownership of which has been claimed by Shri Satish Mehta and seized from possession of Smt. Seema Mehta, the adjudicating authority has held that the physical weight was 1000.009 gms whereas the tax invoice of M/s Kaka Gold produced by assessee is of 1000.00 gms - A difference of .009 gms is not a big difference as the weight is bound to differ from machine to machine and some minor variation is normal - Further, even though the approval challan was in the name of Shri Mukesh Menon and the gold was found to be with Smt. Seema Mehta, it does not make much difference as they were all travelling together - Shri Mukesh menon is employee of assessee and Smt. Seema Mehta is relative of Shri Nitin - Further, all the purchase documents were produced before the investigating authority but the same were nor alleged to be false/ fabricated - No investigation was conducted at M/s Kaka Gold to show otherwise - Therefore, there is no reason to confiscate the said gold bar - These views are also based upon judgments in case of Ashok Kumar Agarwal - 2017-TIOL-3099-CESTAT-ALL and Nand Kishore Modi - 2015-TIOL-2182-CESTAT-KOL - A quantity of 190.002 gms of gold said to be owned by assessee Shri Satish Mehta and seized from PGP Joyeria has been ordered to be confiscated on the ground that there was no relation between invoice of M/s TBZ produced by assessee and said gold and that the transfer Voucher/ challan mentions weight as 190.030 whereas the seized gold was 190.001 gms - The assessee had sent the gold through Shri prakash Duggar to deliver it to PGP, Ahmedabad - The purchase invoice of gold issued by TBZ was addressed to Alma Jewels which is brand of PGP - Even if there is a meagre difference of some milligrams it cannot be said that the gold was procured illegally - Also the revenue has not shown otherwise procurement of goods from the statement of any persons - Thus, the said grounds taken by adjudicating authority cannot be ground for confiscation - A quantity of 4 half cut pieces weighing 505 grams recovered from possession of Smt. Seema devi and said to be owned by Shri Satish Jain has been ordered to be confiscated on ground that the purchase invoice issued by M/s TBZ is not fool proof evidence of legitimacy and the travel voucher shows the weight of gold pieces as 505.470 gms whereas the seized gold pieces 505 gms - M/s Prakash Gold Palace, Mumbai had purchased four gold pieces from TBZ, Mumbai under invoice and the same was addressed to Alma Jewels the brand name of M/s PGP out of this a quantity of 505.470 has been given to Shri Nitin jain to deliver to PGP Ahmedabad for manufacture of jewellery - The travelling documents i.e. Travelling Voucher and transfer note were issued for such transfer which shows that the gold was legally acquired - There is no statement of any person that the gold is of smuggled nature and hence there is no reason to confiscate the same - The confiscation of seized gold and the skoda car in which some of the gold was carried is not correct - The confiscation of seized goods is set aside - For the same reason, the penalty imposed upon all the assessees is also not sustainable and the same is also set aside: CESTAT
- Appeals allowed : AHMEDABAD CESTAT |
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