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SERVICE TAX
2019-TIOL-1297-CESTAT-MAD
Sri Vinayaga Enterprises Vs CCE
ST - Assessee is providing service under category of "Manpower Recruitment Supply Agency Service" and "Mining of Mineral, Oil or Gas Services" and had contravened the provisions of Section 68 of FA, 1994 r/w Rules 6 of STR, 1994, in as much as it had failed to assess its service tax liability resulting in short payment of service tax for period from January, 2011 to March 2013 and thereby rendering itself for payment of interest and penalty under Section 77 (2) and 78 of the Act ibid - During verification of accounts by department, assessee had failed to produce the required documents related to 'Mining service' to M/s. TANMAG - On verification of details furnished by TANMAG, it was alleged that the assessee had short paid service tax of Rs.6,15,481/- - Hence a SCN was issued proposing demand of service tax, interest and imposition of various penalties - It is the contention of assessee that the service tax demand of Rs. 6,15,481/- is included in the payments made by them - Adjudicating authority also accepted this fact - The assessee has drawn the attention to the details of payment prepared in the form of a chart, in the appeal memo and submitted that entire demand of Rs.14,67,032/- was paid which fact has not been properly verified - He also submitted that he is too willing to go before the adjudicating authority once again and convince him with supporting documents if an opportunity is given - Appeal is therefore allowed by way of remand: CESTAT
- Matter remanded: CHENNAI CESTAT
2019-TIOL-1296-CESTAT-HYD
CC, CE & ST Vs Sbec Projects Pvt Ltd
ST - The issue is regarding demand of service tax liability on assessee towards tax under category of "Commercial or Industrial Construction Services" along with interest and for the penalties - It is the case of revenue in SCN that the activity undertaken by assessee would amount to rendering of services which is taxable while it is the case of assessee that they had constructed hospital building which would fall under category of taxable services - Entire activity of construction of hospital has taken place between September, 2004 and December, 2006 - On perusal of the documents and the VAT returns filed by assessee to the Government, it indicates that entire contract was works contract wherein services and materials were consumed - If it is works contract, the law is well settled by judgment of Supreme Court in case of Larsen & Toubro Ltd. wherein it is held that any activity of works contract prior to 01.06.2007 is not taxable under any other head - Accordingly, following the same, impugned order is unsustainable to the extent contested by assessee - As regards the revenue's appeal revenue is only contesting the lower imposition of penalty by the adjudicating authority - Since on merits itself entire case is held in favour of assessee, nothing survives in the appeal filed by the revenue: CESTAT
- Revenue's appeal rejected: HYDERBAD CESTAT
CENTRAL EXCISE
2019-TIOL-1295-CESTAT-BANG
Linde India Ltd Vs CCT
CX - The assessee is engaged in manufacture of Liquid / Gaseous Nitrogen and Oxygen Argon - During audit, it was observed that assessee is manufacturing taxable goods as well as exempted goods i.e. medical grade, oxygen and argon gas - Even though the assessee had used certain inputs which were common to the manufacture of dutiable goods as well as exempted goods, they had neither maintained separate records of inputs/input services, as provided in Rule 6(2) nor paid an amount equal to 6% of value of such exempted goods - Therefore, a SCN was issued to the assessee - The assessee has already reversed the proportionate CENVAT credit in terms of Rule 6(3)(ii) read with Rule 6(3A) and therefore, he is not required to pay 5% / 6% of value of exempted service as demanded by Commissioner (A) - Further, this issue is no more res integra and has been settled by various decisions and by following the ratios of same, impugned order is not sustainable in law: CESTAT
- Appeal allowed: BANGALORE CESTAT
2019-TIOL-1294-CESTAT-DEL
National Engineering Industries Ltd Vs CGST
CX - Whether Department can suo moto adjust the amount of sanctioned refund claim to another demand against the assessee - The demand which has got setoff vide the sanctioned refund claim has not yet attained finality - The only provision available with Department to recover the sums due to Government is Section 11 of CEA, 1944 - Since the amount qua which the refund has been adjusted is not finally held as being payable, the demand confirmed been already sub-judiced before the competent authority, Department was not entitled to recover the same - The question of suo moto adjusting the sanctioned refund qua the said demand therefore does not arise - Commissioner (A) has committed an error while relying upon such direction of the Board, which was technically as well as practically of no relevance at the time of impugned order - It is held that the Department was not entitled to suo moto adjust the refund claim - Support drawn from Nirmal Products 2017-TIOL-2946-CESTAT-DEL as relied upon by assessee wherein it was held that refund cannot be adjusted against the demands which are subjudice and Section 11 should be involved only when the demands have reached finality - Accordingly, Order under challenge, is hereby set aside: CESTAT
- Appeal allowed: DELHI CESTAT
2019-TIOL-1293-CESTAT-HYD
Ultratech Cement Ltd Vs CC, CE & ST
CX - The issue is regarding demand of amount equivalent to 8% or 10% of value of cement cleared to SEZ developers - The issue is no more res integra as High Court of Andhra Pradesh in case of Sujana Metal Products Ltd 2013-TIOL-1128-HC-AP-ST , has settled the law and upheld the order of Tribunal in that case wherein the Tribunal took the view that provisions of Rule 6 of CCR, 2004 are not applicable to supply to SEZ unit - Following the said judgment, the impugned order is unsustainable: CESTAT
- Appeal allowed: HYDERABAD CESTAT
CUSTOMS
2019-TIOL-1292-CESTAT-MUM
Manoj Srivastava Vs CC
Cus - Appellant, an officer appointed under the Customs Act, 1962 has been imposed with penalty of Rs.1 lakh and contends that the principles of natural justice has not been adhered to by the adjudicating authority - appeal to CESTAT.
Held : It appears that the evidence against the appellant on his alleged involvement with the ineligible availment (of DEPB benefits/scrips) are the forensic reports and his admitted association with the assessment of the shipping bill - principles of natural justice mandate that in the absence of corroborative evidence, oral/written deposition should be subjected to test for attaining credibility - It is the right of an accused, especially in the context of reliance on opinions of experts, to be granted an opportunity to discredit an allegation by confronting the expert whose opinion is preemptory and without any reasoning - foundation for upholding the allegations have not been properly laid and a structure built on a weak foundation does not survive - matter remanded to original authority for compliance with principles of natural justice: CESTAT [para 4, 5]
- Matter remanded: MUMBAI CESTAT
2019-TIOL-1291-CESTAT-MAD
P Balamurugan Vs CC
Cus - Based on specific intelligence, department officers had searched Room of S.S. Lodge, Karur and recovered 1 kg. of Gold bar with foreign markings (FMG) from one Shri C. Rajan - The officers seized the gold bar in presence of witnesses - It appeared to department that the said C.Rajan had made arrangements to sell gold bar to one Sri Ramesh through one Shri Sathik; that assessee was contacted by Shri C. Rajan and asked him to arrange 1 KG gold bar - Assessee has been implicated in arranging to obtain impugned one Kg. gold bar - The conclusion of original authority, which has been upheld by the lower appellate authority, is that transaction of valuable gold bar worth Rs.18 lakhs on credit basis was not acceptable in normal trade; that the purported purchase bill was prepared intentionally only after seizure of the gold bar; that transaction value was not genuine and therefore malafide intention of dealing with smuggled gold is established - Assessee in his statement had affirmed that he had purchased 1 kg. gold bar from M/s.Palanimurugan Jewellery on credit basis; that he did know that the gold was an imported one and in his reply to the SCN, they reiterated the same facts and also contended that the gold was seized outside the Customs barrier, hence had attained characteristics of domestic goods and in consequence, question of applicability of Section 111 of Customs Act, 1962 did not arise - During investigation, Shri S. Balamurugan of Palanimurugan Jewellery had deposed that he had brought one kg gold bar from M/s.Surana Corporation on 08.08.2010 - On further enquiry, M/s.Surana Corporation confirmed that Palanimurugan Jewellery had purchased 1 kg. imported gold bar - It was also informed that they had received payment for the above invoice through RTGS dt. 10.08.2010 - The SCN narrates inter alia, that seized gold bar had foreign markings (FMG) - It is also narrated that a seizure mahazar had been drawn after recovery of the gold jewellery, however no mention has been made in SCN as to the description of foreign markings on the gold bar - However, in order of original authority, it is indicated that gold bar under seizure had markings "COMMERZ BANK 1 KILO GOLD 995.0 AH MELTER ASSAYER Switzerland A 21011", whereas the gold bars that has been imported by MMTC Ltd., Chennai were of "ARGOR" brand, issued by M/s.Standard Chartered Bank, London - This discrepancy in markings has not been disputed by assessee - True, the gold bar in question was not seized in a customs area - As per the statements made by Shri C. Rajan, namely, the person from whose possession the goods were seized as also other implicated persons including the assessee, the gold bar had been "purchased" on credit basis from M/s.Palanimurugan Jewellery, Karur - An effort has also been made by these persons to connect the impugned bar with the import of 1000 gold bars made by M/s.MMTC Ltd., Chennai to contend that the impugned gold bar has not been smuggled - The only fly in the ointment is that there is a definite discrepancy in the markings found on the impugned gold bar vis-à-vis markings on the gold bars imported by MMTC Ltd., Chennai - The burden of proving that the gold is not smuggled is inter alia on assessee and secondly, such a burden has not been satisfactorily cast off -This being so, the impugned gold will now become liable for confiscation under Section 112 (d) ibid and the assessee will inconsequence become liable for penalty under Section 112 of the Act - The operation of Section 123 ibid is applicable even to gold and other notified goods seized outside the customs area - Imposition of penalty under Section 112 of Customs Act, 1962 on the assessee is very much justified - The penalty imposed under Section 112 ibid reduced from Rs.1,50,000/- to Rs.50,000/-: CESTAT
- Appeal aprtly allowed: CHENNAI CESTAT |
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