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SERVICE TAX
2019-TIOL-1666-CESTAT-MAD
Shanmuga Services Vs CGST & CE
ST - Audit team noticed that there was difference between the taxable values shows in the periodical returns in form ST-3 returns and the quantum of service charges charged and collected as reflected in the balance sheet for the period 2010-11 - demand notice issued and confirmed along with penalty which order was upheld by Commissioner(A) - appeal to CESTAT.
Held: Para 3.4 of the Show Cause Notice alleges that where any expenditure or costs are incurred by the service provider, the same also has to be included in the total taxable value for discharging the service tax - however, rule 5 of the ST Valuation Rules, 2006 has been set aside as ultra vires by the apex court in the case of Intercontinental Consultants and Technocrats Pvt. Ltd. - 2018-TIOL-76-SC-ST - appellant admits that the amount raised in the Show Cause Notice includes certain amount which is not reimbursable expenses and has to be included in the taxable value - matter remanded to the adjudicating authority for computation of service tax on the taxable amount as admitted by appellant - issue being wholly an interpretational one, there was a reasonable cause for not paying service tax - invoking section 80 of the Finance Act, 1994, penalty imposed u/s 76 is set aside - appeal allowed by way of remand: CESTAT [para 5 to 7]
- Matter remanded : CHENNAI CESTAT
2019-TIOL-1665-CESTAT-HYD
Swamy Sons (Agencies) Vs CCE, C & ST
ST - Appellant had constructed godowns and rented them out to various institutions/companies to store their goods - They had only received the rent from such companies and were not engaged in C&F services for such clients, therefore, the amount of tax of Rs. 7,54,153/- cannot be fixed on the appellant for the simple reason that no services were rendered by the appellant and the service tax liability on renting of immovable property came into statute from 01.06.2007 - impugned order set aside and appeal allowed with consequential relief: CESTAT [para 5, 7]
ST - Agreement between the two parties indicate that they entered into contractual obligations for reimbursement of expenses which were in the form of godown rent - decision of Apex Court in the case of Intercontinental Consultants & Technocrats Pvt. Ltd. - 2018-TIOL-76-SC-ST will apply and any reimbursable expenses during the period in question are not includable in the value of the services rendered: CESTAT [para 6]
- Appeal allowed : HYDERABAD CESTAT
CENTRAL EXCISE
2019-TIOL-1664-CESTAT-AHM
GP Petroleums Ltd Vs CCE & ST
CX - The assessee-company manufactures Lubricant Oil falling under Chatper 27 of the CETA 1985 - Upon audit, it was observed that the place of removal/delivery of finished goods was the premises of their customers - The assessee recovered the cost of transportation from the buyers and took insurance under the open marine policy to cover the loss in transit and safe delivery of goods up to the customer's place - Hence the Revenue opined that the premises of the buyers were to be treated as place of removal as per Section 4(3)(c) of the Act - It was also claimed that the assessee recovered the cost of transportation for such deliveries from its buyers but had not included the cost in the transaction value to be computed for excisable goods - The Revenue also claimed that the assessee had to include transportation charges for determining the transaction value for levying Excise duty, but did not do so - Duty demand was raised - Hence the present appeal.
Held: Perusal of the definition of Place of removal clarifies that either the factory or warehouse where goods are permitted to be deposited or depot or premises of a consignment agent or any other place or premises from where the excisable goods are to be sold after their clearance from the factory, are only place of removal - The Apex Court in CCE, Nagpur vs. Ispat Industries Limited clarified that even any other place or premise from where the excisable goods are to be sold is the premises of the assessee only and there cannot be any other premises belonging to other then the assessee which can be permitted as place of removal - Therefore, where goods are cleared from the factory for sale, even though on FOR basis, the place of buyer cannot be the place of removal in such case the factory from where the goods were cleared for sale is the place of removal - Thus, the freight charges is not includable in the assessable value in terms of Rule 5 of Central Excise Valuation (Determination of Price of Excisable goods) Rules, 2000 - Hence the demand raised is unsustainable: CESTAT
- Assessee's appeal allowed : AHMEDABAD CESTAT
2019-TIOL-1663-CESTAT-DEL
K L Concast Pvt Ltd Vs Commissioner, Central GST
CX - The assessee-company manufactures MS Shapes & Sections - Upon audit, it was found that the assessee procured a transformer and availed credit of 50% of the total duty paid - The remaining credit was found to have been availed in the following year - It was also noted that such transformer was subsequently cleared by the assessee without payment of duty on transaction value u/r 3(5A) of the CCR - On being pointed out, the assessee paid duty along with interest - SCN was issued proposing duty demand - The same was confirmed with interest upon adjudication - The penalty was waived, since duty with interest was paid before issuing SCN - On appeal, the Commr.(A) held that the assessee cleared the goods without mentioning the same in ER-1 returns & so penalty of 50% of duty was imposed, on grounds of suppression of facts - Hence the present appeal.
Held: It is undisputed that the clearance of the transformer was done by raising an invoice - Hence it cannot be said that there is mala fide intent on part of the assessee to suppress fact of clearance of transformer - Non-payment of duty does not ipso facto infer mala fide intent to evade payment of duty - Thus there is no justifiable reason to impose penalty and so the O-i-A in challenge is quashed: CESTAT
- Assessee's appeal allowed : DELHI CESTAT
2019-TIOL-1662-CESTAT-MAD
Hyundai Motor India Ltd Vs CGST & CCE
CX - The assessee manufactures motor cars - During the relevant period, it claimed refund of infrastructure cess paid in excess - The assessee furnished copies of relevant invoices as well as a letter from the dealer, claiming to not have filed any claim for refund - It appeared to the Revenue that as per the Indo-Bhutan treaty, the refund so claimed could not be sanctioned - SCN was issued - On adjudication, the refund claim was rejected - Such findings were upheld by the Commr.(A) - Hence the present appeal.
Held: The assessee placed on record a CA certificate stating that no excess amount was collected from the dealer & there was no instance of unjust enrichment - However, it is seen that such certificate was not put on record before the original authority or before the Commr.(A) - Hence the matter warrants remand for considering the same: CESTAT
- Case remanded : CHENNAI CESTAT
CUSTOMS
2019-TIOL-1661-CESTAT-MUM
Mangali Petrochem Ltd Vs CC
Cus - Assessee have filed Bill Of Entry for clearance of imported goods declaring them as "Base Oil SN 300" - On examination it was found that the import consignment was for 208.925 MTs instead of declared quantity of 200.7 MTs - Representative samples of the imported goods were drawn and forwarded to M/s IOCL Vashi, Navi Mumbai for testing - For the misdeclaration of quantity the goods were seized under section 110 of the Customs Act, 1962 - M/s IOCL Vashi vide its test report remarked "The base oil sample meet closer to SN-500 specification" - Hence revenue was of the view that goods have been misdeclared - Firstly the matter needs to be examined vis a vis the supply of relevant documents to the assessee and whether the assessee had accepted the unit value as determined by SIIB(X) - Matter needs to be reconsidered by Commissioner on the basis of all the facts and documents on record - There is no evidence available on record to show that documents that revenue intended to rely against the assessee were ever given to them - Non supply of the documents relied against the assessee to them before passing the impugned order is denial of natural justice to them - Matter is remanded back to adjudicating authority for reconsideration of matter after following the principles of natural justice - Since the matter is quite old, Commissioner should complete the proceedings in remand within four months: CESTAT
- Matter remanded : MUMBAI CESTAT |
