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SERVICE TAX
2019-TIOL-1689-CESTAT-MAD
Zentech Off Shore Engineering Pvt Ltd Vs CGST & CE
ST - Rule 2(l) of CCR, 2004 - Rule 5 of CCR, 2004 - Car parking services are Input services as the same are availed by the appellant in order to facilitate the parking of cars within the appellant's premises - other issues in respect of which refund was denied requires verification by the refund sanctioning authority, therefore, matter remanded: CESTAT [para 5 to 7]
- Appeal partly allowed/partly remanded: CHENNAI CESTAT
2019-TIOL-1688-CESTAT-MAD
Voltas Ltd Vs CCGST & CE
ST - ROM application - Although the Bench held that the refund claim cannot be rejected on the ground of being time-barred and set aside the impugned order, in paragraph 7 of the CESTAT order, erroneously it was stated that the rejection of the refund claim is "justified" - Application filed for correcting the error apparent on record.
Held: Bench finds that the word "justified" used in paragraph 7 of the Tribunal order is an error apparent on the face of record - inasmuch as the word ought to have been "not justified" - final order is, therefore, modified to the extent of correcting the said sentence to read - "Following the said decisions, we are of the considered opinion that the rejection of refund claims is not justified" - ROM applications allowed: CESTAT [para 3, 4]
- Applications allowed: CHENNAI CESTAT
2019-TIOL-1678-CESTAT-MAD
CGST & CE Vs Sical Distriparks Ltd
ST - The assessee is registered with Department under Cargo Handling Service, Storage and Warehousing Service, Maintenance and Repair Service and GTA Service - The assessee is also in the business as Container Freight Station (CFS) - The undisputed position is that nowhere in the SCN has the Revenue alleged unjust enrichment - Admittedly, "Auction Income" is nowhere defined under the statute and at the most what could have been sought to be taxed, instead of the so- called Auction Income, is the service element relating to the services of Storage and Warehousing, if any - F ollowing the ratio laid down by Mumbai Bench in Balmer Lawrie & Co. Ltd. - 2015-TIOL-2414-CESTAT-MUM , the demand is unsustainable and accordingly, the Revenue's appeal is dismissed: CESTAT
- Appeal dismissed: CHENNAI CESTAT
2019-TIOL-1677-CESTAT-MAD
Sundaram Finance Ltd Vs CCE & ST
ST - It is the case of the Department that even though the appellants have discharged their service tax liability on Financial Leasing activities, the appellants did not discharge service tax on certain leasing transactions which they claim to be Operating Lease transactions; that they did not reflect the said income received from Operating Leasing transactions in their ST-3 returns - demand notices issued and confirmed - appeal to CESTAT.
Held: As per Accounting Standards (AS-19), the Financial Lease is shown as current assets - Further, the Operating Lease is shown under the category of fixed assets - This is because, the equipment which are given on lease under the category of Operating Lease always remain in the ownership of the lessor (appellant-company) - lessee is not entitled to own or does not have an option to own the asset at the end of the lease period, which is the distinguishing feature between an Operating Lease and a Financial Lease - Bench is convinced that as per the documents, the transactions fall under the category of Operating Lease only - Allegation of the Department that the agreements are actually Financial Lease and that Operating Lease is only a misnomer, is factually wrong - demand cannot, therefore, sustain - impugned order is set aside and appeals are allowed with consequential relief: CESTAT [para ]
- Appeals allowed: CHENNAI CESTAT
CENTRAL EXCISE
2019-TIOL-1212-HC-MUM-CX
Specific Alloys Pvt Ltd Vs CCT
CX - Tribunal while dismissing the Appeals recorded that the challenge to the orders dated 15th February, 2008 and 19th February, 2008 of the Commissioner was not on merits of the order but only on the ground that principles of natural justice had been violated; that the grievance of not furnishing relied upon evidence was without merit, as the same was made available along with the show cause notices to the Appellants; that requests for cross examination of the investigating officers, audit officers and range officers made by the Appellants had been denied to the Appellants on the ground that they were not witnesses being relied upon by the Revenue in support of the impugned notices - appeal to the High Court.
Held: Orders of the Commissioner dated 15th February, 2008 and 19th February, 2008 record reasons for non giving of cross examination - Moreover, both the above orders also record the fact that the data obtained on the floppies was returned back to the Appellants on 14th September, 2008 during the course of the investigation under proper acknowledgement - These findings of the Commissioner were not a subject matter of specific challenge before the Tribunal - The impugned order of the Tribunal finds that the the documents relied upon by the revenue were given to the Appellants along with show cause notices and there was no evidence produced to show that evidence other than that relied upon in the show cause notices were being relied by the revenue - Besides, witnesses whose cross examination were sought were not the witnesses in support of the show cause notices - Thus, the view taken by the Tribunal in dismissing the Appellants' Appeal in the present facts, cannot be said to be perverse in any manner - no reasons found to interfere with the order dated 16th January, 2018 - appeals dismissed: High Court [para 5, 9 to 12] - Appeals dismissed
: BOMBAY HIGH COURT
2019-TIOL-1687-CESTAT-AHM
Yash Gases Pvt Ltd Vs CCE & ST
CX - Appellants are engaged in the manufacture of oxygen gas - for the purpose of manufacturing they are purchasing steel gas cylinder and the same are also used for transporting the gas at the time of removal from factory - case of the department is that the CENVAT credit of the duty paid on steel gas cylinders is not admissible since the same are used for transportation; also credit on castor oil has been denied on the ground that the same is not used in manufacturing and was availed during the period of SSI exemption.
Held: Steel gas cylinders are not only used for transportation but also used for storage of manufactured gas - Inasmuch as Oxygen gas is manufactured from air and filled in these cylinders - credit is admissible on steel gas cylinders - lubricating oil is capital goods and even though the credit is availed during the period of SSI exemption, the same is utilized only when the appellant starts paying excise duty - Therefore, cenvat credit on gas cylinder and lubricating oil is allowed and demand relating to these two items is set aside - Remaining demand (cenvat credit in respect of Cement Sheet, MS Beams, Nitrogen Gas) and corresponding penalties stand confirmed as the same is not contested by the appellant - Appeal is allowed in above terms: CESTAT [para 4, 5]
Appeal partly allowed: AHMEDABAD CESTAT
2019-TIOL-1686-CESTAT-BANG
Vijayaa Steels Ltd Vs CC, CE & ST
CX - Commissioner (A) has observed that the appellants have not produced the register for the entire period whereas the appellant submits that they had produced ER-6 Returns, ledger of sale of scrap, statement and purchase of non-cenvatable scrap for the period from 01.04.2011 to 27.01.2013 showing receipt of scrap on which no custom duty was paid and no CENVAT credit availed - appellants have enclosed register of purchase of scrap without payment of duty for the period from 01.04.2014 to 31.08.2014 - Further, Audit has worked out the duty on the basis of Tally Accountants Software and has not properly examined all the documents produced by the appellants and the demand has been worked on the basis of surmises and conjectures – impugned order set aside and matter remanded to the original authority - demand, if any, will only be confined to the normal period of limitation: CESTAT [para 6]
- Matter remanded: BANGALORE CESTAT
2019-TIOL-1685-CESTAT-DEL
Vaswani Industries Ltd Vs CCE
CX - Department has demanded the credit qua the sale of electricity generated by the appellant to the other customers against monetary consideration on the ground that electricity is an exempted commodity.
Held: Electricity is held to be an excisable goods and once it is held as excisable, denial of cenvat credit there upon is contradictory to the legislative intent: CESTAT [para 7]
CX - Iron fills as are emerging as a by-product but an inevitable waste due to being segregated during the manufacture of the final product, the appellant is not liable to be vested with any liability on account of Rules 6 (3)(b) of CCR, 2004 - impugned order set aside & appeal allowed: CESTAT [para 8]
- Appeal allowed: DELHI CESTAT
2019-TIOL-1676-CESTAT-DEL
Select Poly Products Pvt Ltd Vs CCE
CX - The assessee-company manufactures branded mattresses, quilt cloth & rebound sheet - Upon audit, the Revenue noted that the assessee did not pay duty on the sales tax collected from buyers and retained to the extent of sales tax liability discharged through VAT 37-B challans - It was then alleged that the same was not paid by the assessee to evade payment of duty during the relevant FYs - SCNs were issued proposing to raise duty demand with interest u/s 11AA and penalty u/s 11AC - Such demands were confirmed upon adjudication and then sustained by the Commr.(A) later - Hence the present appeal.
Held: The assessee opted for remission of tax scheme under which a portion of the VAT paid is remitted to it - When sales tax or VAT is payable at time of removal in terms of Section 4D of the CEA, the same is not to be included in the transaction value - After assessment by the Sales Tax Department and payment of Sales Tax, the conditions of Section 4(3)(d) would be fulfilled - Besides, the difference between remission and exemption must be kept in mind - In case of the latter, the levy itself is statutorily exhasuted & no sales tax is paid or payable by the assessee - In the former's case, the sales tax is payable and must be statutorily discharged - The remission is in the nature of subsidy which the assessee received from the State Govt in the form of VAT 37B challans and not from buyers - Only the mode of payment is by way of crediting the sales tax head under VAT challan in favour of the assessee - Hence it cannot be said that the amount is in the nature of additional consideration: CESTAT (Para 5-7.1)
Held: Misrepresentation by assessee - As it is already observed that no amount of VAT was retained by the assessee, no question of evasion of duty arises - Once Sales Tax is paid as per the requirements of the Sales Tax Department, the Excise Department cannot allege short levy on grounds that some amount was remitted back to the assessee - There appears to be no suppression or mis-representation of facts - The assessee cannot be held liable for any wrong on part of the Department - No evidence about any positive act is put forth, except for allegations of using VAT challans for payment of VAT liability for subsequent period - Discharge of liability through VAT 37b Challans is held as legally sustainable methodology of discharging tax liability for subsequent period - Hence the extended period of limitation cannot be invoked: CESTAT (Para 10)
- Assessee's appeal allowed: DELHI CESTAT
2019-TIOL-1675-CESTAT-MAD
New India Associates Vs CGST & CE
CX - The issue is with regard to disallowance of credit on GTA service - The Supreme Court in case of Ultra Tech Cement Ltd. - 2018-TIOL-42-SC-CX has held that credit is eligible from place of removal upto the buyer's premises - However, in case of Roofit Industries Ltd. - 2015-TIOL-87-SC-CX , the Apex Court has held that when the sale is on FOR basis, all the charges/cost have to be included in assessable value for payment of central excise duty - Thus, in such cases, when the sale takes at buyer's premises, the place of removal is the buyer's premises - The Board has clarified in their circular dated 8.6.2018 that when the transaction/sale is on FOR basis, the place of removal would be the buyer's premises - Therefore, it is necessary to determine the place of removal to consider the eligibility of credit of service tax paid on freight charges upto the buyer's premises - For this purpose, matter remanded to the adjudicating authority who shall look into the issue of eligibility of credit on GTA service after determining the place of removal - In doing so, the adjudicating authority shall take into consideration the circular issued by the Board as well as the decision of Tribunal in case of Ultra Tech Cement Ltd. - The impugned order is set aside and the appeal is allowed by way of remand to the adjudicating authority: CESTAT
- Matter remanded: CHENNAI CESTAT
2019-TIOL-1674-CESTAT-MAD
Orchid Pharma Ltd Vs CGST & CE
CX - The assessee is a 100% EOU engaged in manufacture of 'Bulk Drugs' - As part of the manufacturing process, assessee use various solvents like Acetone, Iodine, Calcium Fluoride, Sulphuric Acid and Methanol - Post manufacturing process, spent solvents arise as mother liquor - Such spent solvents are sold by assessee - The Department took the view that their tax liability would arise on the clearances of such spent solvents, which are sold by them - Further, the assessee use furnace oil and lubricating oil for their Captive Power Plant which are kept in storage tank - The residue of oil that remains in the tank in form of sludge is cleared and sold as part of cleaning and sanitization process by assessee - The Department took the view that on such clearances of sludge also duty liability would have to be discharged by assessee - Assessee is correct in his assertion that the matter is covered by decisions in Grasim Industries Ltd. - 2011-TIOL-100-SC-CX, Ahmedabad Electricity Co. Ltd. - 2003-TIOL-17-SC-CX , Mettur Thermal Power Station - 2017-TIOL-237-HC-MAD-CX and M/s. Hindalco Industries Ltd. - 2014-TIOL-2266-HC-MUM-CX - The ratio laid down by Apex Court has been consistently followed in a number of decisions of Tribunal, including the ones cited by assessee - This being the case, the impugned Orders to the contrary cannot sustain: CESTAT
- Appeals allowed: CHENNAI CESTAT
CUSTOMS
2019-TIOL-1213-HC-MUM-CUS
CC Vs Srinivas Clearing And Shipping (I) Pvt Ltd
Cus - Application seeks condonation of 582 days delay in filing an appeal from the order dated 11th January, 2017 passed by the CESTAT - Impugned order of the Tribunal had merely set aside the suspension of the Customs Broker License leaving the issue of cancellation of the Customs Broker License to be pursued by the Revenue independently - Revenue ought to have filed an appeal from the impugned order which was received on 17th January, 2017 within the stipulated time - Explanation for the delay offered in the affidavit does not state the date when the approval for filing the appeal was granted by the Chief Commissioner - Filing of appeal from the order dated 11th January, 2017 of the Tribunal was not dependent upon appointment of Presiding Officer for the purposes of cancellation of license - Inaction shows negligence on the part of the Revenue in challenging the order dated 11th January, 2017 of the Tribunal in time - On being asked whether any responsibility has been fixed for the delay, we were informed that it is a separate issue - no sufficient cause has been made out for condonation of delay - Notice of Motion is dismissed: High Court [para 6, 8, 9] - Application dismissed
: BOMBAY HIGH COURT 2019-TIOL-1673-CESTAT-MAD
Trade Wings Logistics India Pvt Ltd Vs CC
Cus - The issue involved is revocation of licence of CHA - Since the decision affects the livelihood of assessee, the appeal has to be taken up out-of-turn - The Miscellaneous Application for early hearing of the appeal is allowed: CESTAT
- Appeal allowed: CHENNAI CESTAT
2019-TIOL-1672-CESTAT-ALL
Mitsui Chemicals India Pvt Ltd Vs CC
Cus - The proceedings were initiated against them by way of SCN alleging that as the assessee had imported 'Homeopathic Medicines' falling under Customs Tariff Act, 30064000 and the same being drugs are not permitted to be imported at ICD Dadri, and consequently proposing confiscation of goods as also imposition of penalty on the assessee - The assessee have declared their imported goods as 'Dental Care Products' in Bill of Entry filed by them - The SCN alleges that the goods falling under Heading 30064000 is 'Homeopathic Medicine' and as such being drugs are not permissible to be imported at ICD Dadri - Said Tariff Heading which covers Dental Cement and other dental filling bone reconstruction cements - As explained, said dental cement is used for creating artificial tooth which are to be further implanted in humans - Tribunal fail to understand as to how the SCN mentioned the goods to be classifiable as "Homeopathic Medicines" - The notice has not proposed to change the classification but simplicitorly alleges that the goods falling under Tariff Heading No.30064000 are Homeopathic Medicine - The notice proposed confiscation of goods on the basis of same being Homeopathic Medicines whereas the Adjudicating Authority has travelled beyond the SCN and has confiscated the goods by holding the same as Medical devices covered by the definition of Drugs - It is well settled law that SCN is the basis for initiation of proceedings and it is not proper for any Adjudicating Authority to travel beyond the allegations made in the notice - Having accepted that such goods are not Homeopathic Medicines which was the basic charge against the notice, Adjudicating Authority should have vacated the proceedings instead of moving ahead for confiscation of goods on an altogether different ground - The allegations in the notice were only in respect of Dental Cement whereas there is no dispute for the other items imported by assessee - As such the confiscation of all the items cannot be justified - In any case and in any view of the matter, other items are neither drugs nor Medical Devices specified in terms of Rule 3(b)(iv) of Drugs and Cosmetics Act - The denial of import of the same at ICD Dadri is not in accordance with provisions of Rule 43A, Drugs and Cosmetics Rule, 1945 - The impugned order is set aside: CESTAT
- Appeal allowed: ALLAHABAD CESTAT |
