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SERVICE TAX
2019-TIOL-1297-HC-MUM-ST
Vishal Enterprises Vs UoI
ST - Main challenge in the petition is to the o-in-o passed by the Additional Commissioner confirming the service tax demand of Rs.35,06,153/- - Petitioner had filed an appeal against this order before the Commissioner(A) however, since the same was filed much beyond the condonable peirod of 60 days, the same had been dismissed by the Commissioner(A) - although initially the petitioner had sought for relief of condonation of delay in institution of such appeal, later they have stated that they do not press for such reliefs sought and said statement has been accepted by the Court - Petitioner submits that the adjudicating authority had denied the benefit of exemption in the matter of services provided to defence and other Government establishments on the ground that the exemption notification was not produced before the adjudicating authority which, the petitioner contends is in flagrant disregard to the law and violates the principles of natural justice; that the adjudicating authority ought to have known about such notification and, therefore, the order warrants interference notwithstanding that the appeal was not filed within the prescribed time before the lower appellate authority.
Held: Contention as raised neither relates to jurisdiction of the Adjudicating Authority nor can it be said that the Adjudicating Authority has acted in flagrant disregard to the law or violated principles of natural justice - Petitioner's plea with regard to the applicability of exemption notification was quite vague inasmuch as the petitioner did not even bother to specify the exemption notification in question - Besides, in order to avail the benefit of exemption notification, it was for the petitioner to establish that the petitioner fulfilled the conditions with regard to supply to the specified agency - Merely raising a contention that the petitioner was entitled to benefit of exemption notification, really does not suffice in such matters - Upon perusal of the order-in-original, Court cannot say that the benefit of exemption notification was declined to the petitioner only because the petitioner failed to produce the exemption notification - In any case, these really are grounds which the petitioner ought to have raised in appeal and these are not the grounds as contemplated in paragraph 31(3)(A) of the decision of the Full Bench in Panoli Intermediate (India) Pvt. Ltd. - 2015-TIOL-1556-HC-AHM-CX-LB - Moreover, though the impugned order-in-original was made on 31st January 2017, this petition has been instituted some time in August 2018 - Even if some reasonable allowance is made for the circumstance that the petitioner had instituted appeal, which was itself time barred before the Appellate Authority, there is no explanation whatsoever for the delay between 3rd January 2018 and August 2018 in instituting present petition - This is an additional reason for not entertaining the present petition - Petition dismissed: High Court [para 10 to 13]
- Petition dismissed: BOMBAY HIGH COURT
2019-TIOL-1783-CESTAT-AHM
CCE & ST Vs Shanti Construction Company
ST - Appellant is not pressing for the issue of levy of service tax on industrial or commercial construction services except the service of residential quarters for State Intelligence Bureau and road construction - Assessee has strongly contested the penalty on the ground of their bonafide belief - Appellant was advised by IOCL that the construction of retail outlet was not taxable, because of this reason they have not paid the service tax - Moreover, the assessees have not suppressed the fact as much as the transactions of construction which are declared in their books of accounts, therefore, the submission of the assessee that they had bonafide belief appears to be reasonable - Invoking section 80 of the Finance Act, 1994, Bench is of the view that the appellant is not liable for penalties under section 76, 77 & 78 - Assessee appeal partly allowed: CESTAT [para 4, 5]
ST - Revenue is in appeal against the setting aside of the demand of service tax on residential quarters and road construction - It is apparent from the definition that road construction is clearly excluded from the purview of service tax under the service of industrial or commercial construction - As regard the levy of service tax on residential quarters, since the construction was for State Intelligence Bureau of the Government, it cannot be treated as Commercial or Industrial construction - Commissioner has rightly dropped the demand in respect of road construction and construction of residential quarters, therefore, no merit in Revenue appeal - appeal dismissed: CESTAT [para 4, 5]
- Assessee appeal partly allowed/Revenue appeal dismissed: AHMEDABAD CESTAT
2019-TIOL-1782-CESTAT-HYD
Shirdi Sai Travels Vs CCT, CE & ST
ST - Tour Operator Services/Rent-a-cab service rendered to EI Dupont Services India Pvt. Ltd. situated and functioning as SEZ and are entitled to receive authorised services as per the letter from the Development Commissioner - service tax demanded from appellant on the ground that SEZ unit M/s EI Dupont had not filed the declaration required under notification No. 9/2009-ST to the authorised authorities - appeal to CESTAT.
Held: There being no dispute that the services were rendered by the appellant to an unit in SEZ who was supposed to follow the provisions of the law, which he did not do so, would not mean that appellant should be saddled with the service tax liability - SEZ unit is authorised to receive the services without payment of service tax - s.51 of the SEZ Act mandate that the provisions shall have overriding effect notwithstanding anything inconsistent in any Act - Impugned order is set aside and appeal is allowed: CESTAT [para 5, 7]
- Appeal allowed: HYDERABAD CESTAT
CENTRAL EXCISE
2019-TIOL-1296-HC-MAD-CX Dellner India Pvt Ltd Vs ACGST & CE
CX - Rule 5 of CCR, 2004 - Refund - Post filing of refund claims, it came to light that the writ petitioner had filed aforesaid refund claims without debiting the refund amounts as provided in the relevant Notification made under Section 11-B of the CE Act - Incidentally, the petitioner had carried forward the entire Cenvat credit available with them as on 30.6.2017 consequent to implementation of GST regime on and from 01.07.2017, in their Electronic Credit Ledger by filing TRAN-1 - refund claims were, therefore, rejected by the original authority and which order has been upheld by Commissioner(A) - Petition filed against this order of rejection.
Held: A careful reading of s.35B of the CEA, 1944 reveals that there is nothing before the Court to demonstrate that the Tribunal i.e., CESTAT cannot go into the aforesaid aspect of the matter, therefore, it is clear that an alternate remedy qua impugned order is available for the writ petitioner - Court is unable to persuade itself to believe that the petitioner is able to demonstrate that it's case falls under any of the aforesaid exceptions adumbrated by the apex court in the case of Authorized Officer, State Bank of Travancore Vs. Mathew K.C. [(2018) 3 SCC 85] - Court is of the considered view that owing to the factual matrix this is an appropriate case to leave it open to the writ petitioner to avail the alternate remedy by filing a Statutory Appeal to CESTAT under Section 35-B of the CE Act - If the writ petitioner chooses to avail the alternate remedy, it is open to the writ petitioner to take out an application for condonation of delay in filing appeal and if such delay condonation application is taken out, CESTAT, i.e., the Tribunal shall deal with the same on its own merits and thereafter deal with the appeal, subject of course, to the outcome of delay condonation application - Writ Petition disposed of: High Court [para 12, 14, 15, 17, 18, 20, 21, 22, 24]
- Petition disposed of: MADRAS HIGH COURT
2019-TIOL-1785-CESTAT-AHM
CCE & ST Vs Goyal Synthetics Pvt Ltd
CX - Appellant is a 100% EOU and is engaged in the manufacture of Polyester Filament Yarn - Case of the department is that the appellant have not entered the aforesaid goods in statutory records with intention to remove the same without payment of central excise duty - SCN issued and in adjudication, goods confiscated, redemption fine imposed along with penalties appeal to CESTAT.
Held: Contention of the appellant that Rules 53, 209A and 173Q of Central Excise Rules, 1944 are not applicable in the case of 100% EOU have not been examined by the adjudicating authority - Since this is very important legal issue raised by the appellant, it is necessary that the same should be answered by the adjudicating authority - Matter remanded - Revenue appeal is, therefore, also disposed of by way of remand: CESTAT [para 4, 5]
- Matter remanded: AHMEDABAD CESTAT
2019-TIOL-1784-CESTAT-AHM
Oil And Natural Gas Corporation Ltd Vs CCE & ST
CX - These appeals have been filed by M/s. ONGC against denial of Cenvat credit on input services utilized for drilling activities undertaken at Mumbai offshore fields - The assessee have distributed credit availed by them in respect of services availed at their offshore facility which is separately registered under Central Excise - The credit was also distributed to their plant located at Raigad - In the case of plant located at Raigad, the matter went up to the High Court of Bombay - The High Court held that the said distribution of credit cannot be denied - The impugned order seeks to differentiate the said order of High Court of Bombay on the strength of order passed by Gujarat High Court in case of M/s. BG Exploration and Production India Limited , M/s. Reliance Industries Limited and the assessee themselves - The issue involved in that case was about leviability of sale tax on the material sold from such offshore locations - The Commissioner has sought to differentiate the order of High Court of Bombay on the ground that while appellants had contended that the gas generated at the well head at Mumbai High is not salable, Gujarat High Court has held otherwise in case of BG Exploration and Production India Limited - This fact is not relevant for purpose of distinguishing the decision of High Court of Bombay which is on an identical issue - The perusal of relevant Rule 7 of CCR, 2004 shows that word 'sale' does not appear anywhere in the Rule - In fact the whole Rule is premised on the use of services in or in relation to manufacture of finished products where the invoices are received at a place different from the manufacturing facility for the reason that such services are availed commonly by different units/ manufacturers - The distinction made by Commissioner on the basis of this fact is misplaced - The ratio of decision of High Court of Bombay is squarely applicable to the present case - Consequently, relying on the aforesaid decision of Bombay High Court, the appeals are allowed: CESTAT
- Appeals allowed: AHMEDABAD CESTAT
CUSTOMS
TRADE NOTICE
Trade Notice 19
Response to various representations against Allocation of Quota for Pulses/Peas
CASE LAW 2019-TIOL-1786-CESTAT-BANG
KN Venugopal Vs CC
Cus - The assessee was involved in alleged smuggling of Red Sander which was unearthed by DRI - Assessee as well as other accused had made statements before Customs officer under Section 108 of Customs Act, 1962 wherein they have admitted their role in said smuggling of Red Sander - The original authority in has discussed the role played by assessee in the alleged smuggling of Red Sander which is a prohibited item for export - The confessional statement of assessee and other persons who were involved in smuggling fully corroborated by documentary as well as circumstancial evidences of the case and the statements of co-accused - The objection of assessee that cross-examination was denied is not sustainable in view of various decisions relied upon by Revenue wherein it has been held that cross-examination cannot be claimed in every case as a matter of right - With regard to quantum of penalty imposed on assessee under Section 114 and 114AA of Customs Act, 1962, it is on a higher side because the original authority has imposed penalty of Rs.2.5 lakhs each under Section 114 and Section 114AA on the main accused viz. Mr. Abdul Razak and Shri K.P. Sibu - These two persons were the prime persons in the attempted smuggling of the Red Sander logs but inspite of that the original authority has imposed the penalty of Rs.2.5 lakhs for each offence - Therefore assessee has rightly been convicted under Sections 114 and 114AA of the Customs Act, 1962 - But the amount of penalty to Rs.2.5 lakhs is reduced for each offence under Sections 114 and 114AA of the Customs Act, 1962: CESTAT
- Appeal dismissed: BANGALORE CESTAT |
By Krishnamachari Srinivasan 
