SERVICE TAX

Nava Bharat Agro Products Ltd Vs CC, CE & ST

ST - Appellants are manufacturers of crude palm oil by extracting the same from the fruits of the palm trees and which are their inputs - They are availing GTA services for getting the said inputs - department opined that the appellant needs to take registration for discharging the liability on GTA being received - consequently, the appellant got themselves registered on 25.03.2009 and paid Rs.74,143/- as service tax for the period 2005 to 2008 - a SCN dated 22.04.2010 came to be issued for recovery of service tax for the period April 2005 to September 2009 and the demand of Rs.1,32,029/- along with Education Cesses came to be confirmed along with interest and penalties - as the demand was upheld by the Commissioner(A), the assessee is before the CESTAT - It is submitted that the GTA services availed is with respect to the transport of palm oil fruit and notification 33/2004-ST exempts from the levy under GTA of transport of fruits; that the adjudicating authority denied the exemption on the ground that although palm oil fruit is a "fruit" but the same is not edible.

Held: Notification 33/2004-ST is silent about any definition or classification of fruit and all other products mentioned therein - From the Stroud's Judicial Dictionary of Words and Phrases, it is clear that the term 'fruit', in legal acceptation, is not confined to the produce of those trees which in popular language are called fruit trees, but applies also to the produce of oak, elm and walnut trees - a conjoint reading of the definition of 'fruit' as above and that in the Oxford dictionary leads one to form the opinion that any produce of a tree which is the result of ripened ovary, irrespective of nature of it being edible or not, amounts to fruit - product being transported in the present appeal is palm oil fruit - Bench is, therefore, of the opinion that the fruit in question is very much covered by the notification - adjudicating authorities have formed a very rigid and narrow definition of fruit - Impugned order is set aside and appeal is allowed with consequential relief: CESTAT [para 5, 6]

- Appeal allowed: HYDERABAD CESTAT

2019-TIOL-2094-CESTAT-HYD

S Suryanarayana And Company Vs CCE, C & ST

ST - Assessee is a provider of services and has been issued a SCN demanding service tax for the period 2007-08 and 2008- 09 - In view of three specific issues claimed by assessee viz; abatement under notfn 1/2006-ST in respect of Commercial or Industrial Construction Service, abatement under notfn 17/2005- ST in respect of Site Formation, Excavation, Earth Moving and Demolition Services and the activities charged under Management, Maintenance & Repair being in the nature of works contract services and therefore not being acceptable prior to 01.06.2007 and not being chargeable to service tax under Works Contract Service post 01.06.2007 because the demand was not made under this head - These aspects need to be considered by original adjudicating authority after following principles of natural justice - Insofar as the cleaning services are concerned, it found hard to hold that sweeping of roads or cleaning of drains cannot be considered as cleaning services as claimed by assessee - The assessee has not disclosed any of the services to the Department and these came to light only by investigation by Department and therefore having not made out any case for exemption from penalty under section 78 - The demand of service tax on cleaning service is upheld - Appeal is allowed by remand to the original authority: CESTAT

- Appeal disposed of: HYDERABAD CESTAT

2019-TIOL-2093-CESTAT-DEL

Rajeev And Associate Vs CCE

ST - The assessee is engaged in providing business auxiliary services, errection, commissioning & installation services and maintenance and repair services - During audit, it was observed by Department that the assessee has shown the payment of Service Tax during the period 2010- 11 to a Code No. AAOFA 3157 ESP 001 the said Code is not allotted to the assessee - There is annexed the order of Commissioner (A) vide which the assessee was allowed the refund as was deposited by him, however, against a wrong Service Tax Code and in the name of a wrong depositor - The Commissioner (A) in the said order has clearly observed that the amount deposited in name of M/s. Rajeevated Engineering & Allied Products has been debited in the Bank account of assessee - Accordingly, the refund was allowed - No doubt the Service Tax as demanded by impugned SCN was to be deposited against the correct Service Tax Code of assessee - From impugned order, it is apparent that the amount which was allowed to be refunded has been refunded to the assessee, but it is the assessee's contention that the amount was never refunded and it was understanding that the same shall be appropriated against his liability for the period in dispute - However, there is admittedly no evidence for the deposit of impugned demand in assessee's Service Tax Code - But, the record bears the copy ot ST-3 Return as was filed by assessee for the disputed period - Perusal thereof makes it abundantly clear that the said return is about the impugned amount only and that it was filed on 14.04.2011 itself - Accordingly, irrespective the amount was not actually deposited against assessee ST Code, the fact remains is that the notice of impugned mistake was to the Department since April 2011 itself - The allegations of Department about suppression of facts on part of assessee with the mention that the mistake came to the notice only at the time of Audit is not sustainable specially in a case where the duty has been paid, however, to a wrong Excise Code - If the amount is deposited and duly credited in Govt. account, it cannot be treated as non-payment of duty - Above all, it cannot entitle the Department to invoke the extended period of limitation - The period in dispute is of the year 2011 - The SCN has been issued to the year 2014 - The impugned mistake was in the notice of Deptt. since the year 2011 - Resultantly, the SCN is barred by limitation - The order under challenge is not sustainable: CESTAT

- Appeal allowed: DELHI CESTAT

CENTRAL EXCISE

Wmw Metal Fabrics Ltd Vs CCE & ST

CX - Case of the Revenue is that the capital goods purportedly received under the cover of invoices (on which CENVAT credit has been availed) have been cleared by the supplier who did not have any manufacturing facility and was issuing invoices without any physical clearance - credit denied on the ground that Trade Mark, Number, Name of the manufacturer or any other specification relating to capacity/speed, year of the manufacture etc. was not visible on any part of the capital goods on the basis of which it could be ascertained that the machinery parts stated to have been installed were the same as received by the assessee under the cover of impugned invoices - Sr. GM of the appellant in his statement submitted that on the basis of invoice of the supplier they were made to believe that the same would have been manufactured by them only - it was held by the lower appellate authority that the appellant failed to discharge the obligation cast upon them in terms of Rule 9(6) of Cenvat Credit Rules - appeal to CESTAT.

Held: Bench finds that the show cause notice is defective for non-joinder of essential parties - Also there is lack of sufficient evidence by the Revenue - appellant has discharged its onus as required by them under Rule 9(6) of the CCR, 2004 as it is an admitted fact that the particular machinery part/capital goods were found available in their factory at the time of inspection - appellant has utilized statutory way-bill (Form VAT-47), and has made the payment by Account Payee cheques, both to the supplier and to the transporter - Oral evidences recorded are not reliable, being in violation of the provisions of Section 9D of the CE Act - Show cause notice is, therefore, not maintainable as the same is presumptive and more by way of wild allegation - impugned order is set aside and appeal is allowed - appellant is entitled to consequential benefit including the refund of cenvat credit reversed and the amount paid by way of interest through PLA - Adjudicating Authority is directed to grant refund within a period of 60 days: CESTAT [para 10]

- Appeal allowed: DELHI CESTAT

2019-TIOL-2096-CESTAT-HYD

Yeluri Formulations Ltd Vs CC, CE & ST

CX - Section 4 of the CEA, 1944 - Valuation of Physician samples - appellant sold the same to distributors who distribute it free of cost to the physicians in order to market the products and expand their own market - appellant discharging CE duty on the transaction value whereas Revenue alleges that the valuation should have been arrived at in terms of s.4A of the CEA, 1944 - appellant submitting that being small manufacturers they cannot afford to supply physician samples free of cost but sell them to distributors and such samples do not bear any retail sale price on them - demand confirmed, hence appeal before CESTAT.

Held: Present case is similar to the case of Parnax Lab Pvt. Ltd. - 2011-TIOL-1668-CESTAT-AHM in which there is a transaction value because the physician samples were sold by the manufacturer to the Distributor who in turn supplied them at free of cost to the Doctors - findings of the first appellate authority that selling physician samples is violative of Drugs & Cosmetics Rules, 1945 is an issue which may have to be looked into by the State Drugs Controller/Drug Controller of India but where there is a transaction value, the same cannot be ignored - Once the samples are sold and there is a transaction value, the price at which they are sold forms the assessable value and the assessment has to be done accordingly u/s 4 of CEA, 1944 - no differential duty can, therefore, be charged by applying s.4A of CEA, 1944 - where the appellant is able to provide documentary evidence to the adjudicating authority to substantiate their claim that physician samples were sold by them and not at free of cost, demand is set aside to the said extent and where the appellant is unable to substantiate their claim, demand along with interest is sustained - all penalties are set aside: CESTAT [para 8]

- Appeals disposed of: HYDERABAD CESTAT

2019-TIOL-2095-CESTAT-AHM

Uniglobe Packaging Pvt Ltd Vs CCE & ST

CX - Appellants are engaged in the activity of purchasing lay flat tubing, converting by slitting small bags and selling the same on payment of duty - They are also purchasing shrink caps which after inspection and packing into bags are sold to the customers on payment of duty - Similarly they are purchasing waste packing bags which are used for packing of the aforesaid product cleared on payment of duty - They are availing credit on lay flat tubing, shrink caps and waste packing bags - case of the Revenue is that the aforesaid activities do not constitute manufacture as envisaged in s 2(f) of the CEA, 1944 and hence, the appellants are not entited for CENVAT Credit - demand confirmed, therefore, assessee in appeal before CESTAT.

Held: Transaction carried out by the appellant is squarely covered under Rule 16 of Central Excise Rules, 2002 - This provision clearly makes it clear that even if the activity does not amount to manufacture, the CENVAT credit is admissible - There is no case of the department that the appellant have paid duty less than the CENVAT Credit - impugned order set aside and appeals allowed: CESTAT [para 4]

- Appeals allowed: AHMEDABAD CESTAT

CUSTOMS

NOTIFICATION

dgft21pn019

DGFT permits export of 10000 MT raw sugar to EU under CXL Quota

dgft20pn019

CBIC issues detailed clarification on exemption to re-import of goods exported under duty drawback in respect of goods exported for exhibition purpose

cuscir22_2019

Clarifications regarding Refunds of IGST paid on import in case of risky exporters

cuscir21_2019

Clarification regarding applicability of Notification No. 45/2017-Customs dated 30.06.2017 on goods which were exported earlier for exhibition purpose/consignment basis

Trade Notice 26

Corrigendum to Trade Notice No . 06/2019-20 dated 16th April, 2019

CASE LAWS

Polaris India Pvt Ltd Vs CC

Cus - The assessee is engaged in import of all Terrain Vehicles (ATVS) and its spare parts from outside India - They filed a refund claim on 31.07.2013 against 13 Bill of Entries cleared during the period of August, 2011 to January, 2012 - All the said 13 Bills were provisionally assessed at the time of clearance of goods - The refund was claimed on account of payment of 8% Special Excise Duty and on account of excess payment of CVD as was claimed by parties - The application of refund was partly allowed as far as the amount of SED was concerned - However the refund qua CVD was rejected - Perusal of the said order shows that the refund of SED was nowhere being objected that a fresh application of refund for CVD was filed on 11.08.2014, which was sanctioned vide O-I-O - The perusal of said order shows that the order has nowhere questioned the sanction of refund of 8% of SED - It rather sanctioned the refund of CVD as well - However, without interest which order has been confirmed by Order under challenge - The application is within one year of the last Bill of Entry among 13 i.e. dated 05.01.2012 - Even first Bill of entry fulfills the aforesaid limitation as applicable to assessee - Section 27 (1B) prescribes the mode of computing the aforesaid period of limitation of one year - Thus, Sub-clause (c) thereof gives the extended time to the assessee and not to the Department - The refund claim herein was filed much prior to the date of final assessment of duty - Department is, therefore, opined to not to be entitled of any benefit out of Section 27 (1B) (c) of the Act, as apparently no fresh application after re-assessment / final assessment of SED as well as CVD was at all filed by assessee - His refund application is the one dated 31.07.2012, which was filed within one year of the payment of duty as was provisionally assessed - Hence, no benefit of extended period of limitation can be made available to Department - Department was otherwise liable to make an order on the refund application and in case the competent authority is of the opinion that the amount is refundable - He may make an order accordingly, and the amount so determined mandatorily to be credited to the fund - Section 27 (a) of Customs Act says that if any duty ordered to be refunded under Sub-Section (2) of Section 27 to the applicant is not refunded within 3 months from the date of receipt of application under sub-section (1) of Section 27 they shall be paid to the applicant the interest at such rate as is mentioned in the said Section - The application for refund was filed on 31st July, 2012, another application in continuation thereof was filed on 11.08.2014 - Reassessment was on 24.11.2015 - Apparently and admittedly, the amount of refund has been sanctioned but has not been refunded within 3 months from the date of receipt of the application, Section 27 (a) being a statutory mandate upon the Department, Department is liable to pay the interest on the sanctioned amount for the delayed period - The order under challenge is hereby set aside: CESTAT

- Appeal allowed: DELHI CESTAT