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SERVICE TAX
2019-TIOL-1389-CESTAT-KOL
Infosys Technologies Ltd Vs CCE, C & ST
ST - Appellant is a 100% EOU and has constituted a Trust, namely, Infosys Technologies Limited Employees Welfare Trust through a Trust deed for the purpose of welfare of its employees - The Trust inter alia provides sports and recreational facilities to the employees who become members on payment of nominal monthly charges - SCN was issued to the appellant alleging that they had during the period 16.08.2002 to 31.01.2007 rendered the services of 'Health Club and Fitness Centre services' to employees and are liable to discharge Service Tax thereon - demand confirmed by the original authority along with equivalent penalty and interest and the order was upheld by the Commissioner(A), therefore, appeal before CESTAT.
Held: From the records, it appears that the Trust has been constituted in the year 1994 much before the period of dispute impugned - both, the Trust and appellant company cannot be said to be one and the same entity inasmuch as both are separately assessed to Income Tax and both have been granted service tax registrations - lower authorities have noted that the alleged services have been actually rendered by the Trust in the company premises but that cannot be the criterion for ascertaining the service provider - entire contribution made by members has been received by the Trust and not the company - so also, the quantification of the service tax demand is based on the members' contribution to the Trust as appearing in the financial statements of the Trust and not the company - As per the section 65(7) of the Finance Act, 1994, the term ‘assessee' means the person liable to pay service tax and as per the Rules, the person liable to pay service tax is the person who has provided the taxable service - It is not disputed that the services have been actually provided by the Trust and not the company and the Trust had subsequently registered itself in the year 2006 and has been discharging service tax under the category of 'Club or Association Services' - Lower authorities have committed a fundamental error to confirm demand merely because the tax was not paid by the Trust, completely ignoring the statutory provisions that under the Scheme of the Act, tax could be levied and collected from the person who has actually provided the taxable service - It would be highly injudicious and against the statutory provision to saddle the appellant with the service tax liability on the services not rendered by them - impugned order set aside and appeal allowed with consequential relief: CESTAT [para 5 to 7]
- Appeal allowed: KOLKATA CSETAT
2019-TIOL-1382-CESTAT-MAD
DTDC Enterprise Services India Pvt Ltd Vs CGST & CE
ST - The assessee-company provided Information Software Technology Services during the relevant period - It filed claim for refund u/r 5 of CCR 2004 r/w Notfn No 27/2012-CE(NT) dated 18.6.2012 for refund of credit on various input services for such period - On adjudication, the refund claim was rejected on grounds that the conditions in Para 2(h) of the Notfn had not been fulfilled - Such denial of refund was sustained by the Commr.(A) - Hence the present appeal.
Held: Relevant portions of the O-i-O show that the assessee filed declaration disclosing the debit made by it - Such letter was enclosed with the refund claim - The same is also established from the evidence on record - Hence the madate of Para 2(h) of the Notfn stands satisfied - Thus the matter warrants remand to the authority concerned, who would process the refund claim as per law - The O-i-A denying refund is quashed - Appeal allowed by way of remand: CESTAT
-Assessee's appeal allowed : CHENNAI CESTAT
ST - The assessee-company made some exports during 2008-09, for which it paid commission to the overseas buyers during 2012 - It paid service tax on the commission amount - The assessee then claimed refund after about three months - Such claim was barred by the Revenue on grounds of limitation, on grounds that it should have been filed within one year from date of export - Hence the present appeals.
Held: As per Section 11B, the relevant date in this case is the date of payment of remittances to the overseas agenct - The same stands paid in March 2012 & the refund was claimed in June 2012 - Hence the refund claim is within the time limit u/s 11B & cannot be rejected as being time barred: CESTAT
- Assessee's appeal allowed : CHANDIGARH CESTAT
CENTRAL EXCISE
2019-TIOL-1066-HC-MAD-CX
Maruthi Plastics Vs CCE
CX - (i) Whether the impugned order passed by CESTAT confirming the assessment of the Respondent without appreciating the monthly submission of ER-1 Form by the Appellant valid through the eye of law? (ii) Whether statement made by the Respondent that sale is not sole consideration for goods supplied free of cost sustainable in law? (iii) Whether stand of the Respondent that appellant suppressed value of free supplies of materials amount to suppression of facts? (iv) Whether imposing penalty on the appellant despite payment of duty before service of show cause notice is valid in law? (v) Whether the show cause notice issued by the Respondent is barred by limitation of one year?
Held: The fact which cannot be disputed by the assessee is that they had included the amortised cost of free items while clearing the finished products by paying duty on the assessable value whereas, for the purpose of arriving at the aggregate value of clearances to avail the benefit of the SSI exemption notification no.9/2002 which limits the aggregate value to Rupees One Crore, the amortised cost of free items was not included - in other words, if the amortised cost of free items is included in the computation of the aggregate value of clearances, it would exceed the threshold limit of Rupees One Crore - consequently, the assessee will not be entitled to the benefit of the SSI exemption notification no.9/2002 - on facts, the original authority, the first appellate authority and the Tribunal noted the conduct of the assessee and recorded a factual finding that there is suppression of fact with an intent to evade payment of duty - the assessee cannot contend that there can be no suppression because the material was gathered from the documents and records - it is not the case of the assessee that they had made declaration to the Department on their own volition, but it is an admitted fact that the matter was detected at the instance of the Department during the course of verification of the documents - the entire matter revolves on factual issues which have been considered by the original authority, affirmed by the first appellate authority and the Tribunal - there is no question of law, much less a substantial question of law arising for consideration in this appeal - the appeal fails and is dismissed : HIGH COURT [para 18, 19, 20, 21, 22]
- Civil Misc. Appeal dismissed: MADRAS HIGH COURT
CX - The assessee-company claimed Cenvat credit on certain capital goods - However, the Revenue denied the same on premises that the capital goods on which credit had been taken were not installed in the assessee's factory - Hence the present appeal.
Held: The Revenue's case is that at time of audit, the capital goods were not found to be installed in the registered premises of the appellant & had been found installed in some other premises, where the manufacture process took place - However, as these capital goods were used in the manufacture of final product, the assessee is entitled to avail Cenvat credit on these capital goods - Such a view stands fortified by the Apex Court's judgment in Vikram Cement vs. CCE, Indore - 2006-TIOL-150-SC-CX and that of the Punjab & Haryana HC in Pooja Forge Ltd. - - 2007-TIOL-72 7-HC -P&H -CX : CESTAT
- Assessee's appeals allowed : CHANDIGARH CESTAT
CX - The assessee-company is engaged in the manufacture of transformers - Upon investigation by the Revenue, it was observed that the assessee cleared Specially Designed Transformers to some manufacturers of Wind Operated Electricity Generating Systems without payment of duty & by claiming exemption under Notfn No 06/2006-CE - The Revenue opined that the clearances in question were ineligible for exemption for period between Feb 2007 to April 2011 - SCNs were issued proposing duty demand with interest & imposition of penalties - On adjudication, the Commr. adjusted the proposed duty against an amount reversed by the assessee u/r 6(3) of CCR 2004 - The remaining amount was demanded as duty with interest along with equivalent amount of penalty being imposed u/s 11AC of the Act - Hence the present appeal.
Held: The adjudicating authority confirmed that the assessee made at least three attempts to obtain clarifications from July 2006 to August 2007 - The receipt of such communications was acknowledged by the adjudicating authority - In such circumstances, the Revenue cannot steam-roll demand for extended period, alleging suppression or mis-statement of facts with intent to evade payment of duty - None of the ingredients for invoking extended limitation are present in this case - Hence the penalty imposed u/s 11AC is untenable - Hence the duty demand can be sustained only for the normal period of limitation - However, the matter warrants remand to re-quantify the net duty liability for the portion of demand that survives for the normal period of limitation: CESTAT
- Assessee's appeal partly allowed : CHENNAI CESTAT
CUSTOMS
NOTIFICATION
cnt36_2019
CBIC notifies tariff rates for Crude Palm Oil, Soyabean oil, Brass Scrap, Poppy Seeds, Gold, Silver & Areca Nuts
CIRCULAR
eca_circular_19_024
DGFT puts in place mechanism for Administrative review of selected adjudication orders
dgft18cir023
Non-requirement of submission of Hard Copy of application at RAs for issue of Advance Authorisation (AA) & EPCG Authorisation CASE LAWS
2019-TIOL-1065-HC-AHM-CUS
CC Vs Pravin R Ajudiya
Cus - Adjudicating authority ordered absolute confiscation of the seized rough diamonds valued at Rs.1.05 crore and imposed penalty of Rs.45 lakhs on the respondent - on appeal by the respondent, the Tribunal allowed the appeal - applicant seeks stay of the impugned order dated 2.7.2018 passed by the Tribunal:
Held: At this stage, when the respondent has succeeded before the Tribunal and rough diamonds are otherwise freely importable and are duty free, a case of absolute stay of the order of the Tribunal has not been made out - however, to protect the interest of the revenue, the goods may be permitted to be released subject to certain conditions - such conditions would be in line with the earlier orders passed by this court in case of Dharmesh Pansuriya and D. Jewel - the application partly succeeds and is accordingly allowed to the following extent - pending the department's appeal, the seized diamonds are ordered to be released in favour of the respondent upon the respondent paying redemption fine equal to 10% of the value of goods and fine equal to 1% of the value of the goods and providing a bank guarantee for a sum of Rs.25 lakh to be kept alive till final disposal of the appeal - the respondent shall also file an undertaking before this court that in the event, the applicant succeeds in the appeal and if absolute confiscation of the goods is ordered or the respondent is held liable to pay an amount more than the amount paid under this order, the respondent shall pay the differential amount that he may become liable to pay under such order - the application stands disposed of accordingly : HIGH COURT [para 7, 8, 9]
- Civil Application disposed of: GUJARAT HIGH COURT
2019-TIOL-1064-HC-DEL-CUS
Morgan Tectronics Ltd Vs UoI
FOREIGN Trade (Development and Regulation) Act, 1992 [FTDR Act] - Petitioner has filed the present petition impugning the minutes of a meeting dated 6.1.2016 [the impugned minutes] passed by respondent no.3, the Unit Approval Committee, NOIDA Special Economic Zone [UAC] - by way of the impugned minutes, the Letter of Approval [LoA] issued to the petitioner was cancelled - the said impugned minutes were further affirmed by respondent no.2, Board of Approval, Department of Commerce [BoA] in its meeting dated 9.11.2016 and the appeal preferred by the petitioner was rejected:
Held: A plain reading of the impugned decision of the BoA indicates that the petitioner's appeal had been rejected on the ground that the petitioner had not furnished details of import, export and sales in the domestic tariff area in the prescribed format - it is also observed that the petitioner had failed to provide details of Free Foreign Exchange received from overseas and, therefore, it was not possible to ascertain the Net Foreign Exchange (NFE) position - the BoA also noted the observations of the UAC - it is also apparent that the petitioner's explanation that its records had been seized by the DRI and, therefore, they were not in a position to submit the same, was not accepted by the BoA - it is also noticed that the BoA had also taken an adverse view regarding the mis-declaration of goods covered under certain Bills of Entry - it had also noticed that the petitioner had paid an aggregate sum of Rs.50 lakhs towards duty/penalty/fine as a result of the investigation carried out against the specified Bills of Entry - the petitioner asserts that it had paid the penalty/fine without prejudice to its rights - further, it has prevailed before the CESTAT and the said amount is now required to be refunded to the petitioner - clearly, if the petitioner has succeeded in establishing that it was not liable to pay the duty/penalty/fine as imposed, no adverse view taken on that ground can be sustained - in the aforesaid circumstances, it is apposite that the BoA re-examine the petitioner's contention in the light of the decision rendered by the CESTAT - it would also be apposite for the BoA to consider the petitioner's contention that it had in fact achieved a positive NFE if the petitioner places the necessary documents to establish the same - in view of the above, the impugned order is set aside and the matter is remanded to the BoA to consider the petitioner's appeal afresh - the petition is disposed of in the aforesaid terms - the pending application is also disposed of : HIGH COURT [para 23, 24, 26, 27, 28, 29, 30]
- Writ Petition disposed of: DELHI HIGH COURT
2019-TIOL-1067-HC-MAD-CUS
CC Vs BMW India Pvt Ltd
Cus - Notfn. 12/2012-Cus - Import of Cars in CKD condition - SIIB Case - Tribunal, while upholding the demand, restricted the same to the normal period of limitation and only for the purpose of re-quantification of the demand for the normal period with interest liability as applicable, the matter was remanded to the Adjudicating Authority - Penalty imposed u/s 114A was set aside; confiscation of the goods u/s 111(m) and (o) was upheld; redemption fine was upheld, however, same was reduced to Rs.1 Crore; imposition of penalty u/s 112(a) was upheld but same reduced to Rs.1 Crore - assessee/importer preferred an appeal before the Supreme Court and which is pending - Revenue filed the present appeal against the order of the Tribunal which was not in their favour vis-à-vis the order of the adjudicating authority - Court posed a question to the ASG as to whether the appeal filed by the Revenue is maintainable before the High Court when the order impugned is a subject matter of challenge before the Supreme Court.
Held: Question would be as to whether the order passed by the Tribunal can be truncated and decided by two different courts at two different levels ? - Answer to the said question should be in the negative in the sense that an order passed by the Tribunal cannot be truncated and two courts cannot test the correctness of that order - appeal is, therefore, not maintainable reserving liberty to the appellant-Revenue to approach the Supreme Court under Section 130E of the Customs Act - Appeal dismissed: High Court [para 14, 23, 24, 25, 29, 32]
- Appeal dismissed: MADRAS HIGH COURT
Cus - Assessee want to withdraw the appeal as the same is infructuous - Request accepted: CESTAT
- Appeals dismissed : DELHI CESTAT |
