SERVICE TAX

2019-TIOL-2124-CESTAT-MUM

Arcadia Shipping Ltd Vs CCGST & CE

ST - Appellant owns three vessels/ships which are used for transport of bulk cargo like fertilisers - among other services, appellant also provides ocean freight - it appeared to Revenue that Ocean freight was not defined in taxable service till 30.06.2012 and from 01.07.2012, Ocean freight appeared in the negative list u/s 66D(p) of the FA, 1994 as non-taxable service - it is, therefore, the Revenue contention that an amount attributable to Ocean freight under rule 6(3) of the CCR is required to be reversed since the assessee had not maintained separate accounts for taxable and non-taxable service - demand confirmed along with interest and penalty, which order was upheld, therefore, appellant before CESTAT.

Held: Rule 2(e) of the CCR, 2004 which defines 'exempted service' has been substituted from time to time and finally it was clarified by way of substitution w.e.f 01.03.2016 [13/2016-CX(NT)] that exempted service does not include Ocean freight - said explanation and/or clarification relates back to the date since the said rule exists in the statute, therefore, the demand is untenable - impugned order is set aside and appeal is allowed: CESTAT [para 10]

Limitation - SCN has been issued by way of change of opinion - there is no case made out of any suppression of facts or contumacious conduct as the transactions were duly found recorded in the books of accounts maintained in the ordinary course of business - demand not sustainable - appeal allowed: CESTAT [para 10]

- Appeal allowed: MUMBAI CESTAT

2019-TIOL-2107-CESTAT-ALL

CCE Vs Deora Electricals

ST - The assessee-company provides various services to the Military Engineering Services, Railways, M/s BSNL & M/s UPSTD Corporation Ltd. - During the relevant period, the assessee was served an SCN raising duty demand - The same was confirmed upon adjudication - Thereafter another SCN was issued raising further duty demand, which too was confirmed - On appeal, the Commr.(A) quashed both the duty demands raised - Hence the Revenue's appeals.

Held - The Commr.(A) had observed in the O-i-A that the service provided to the MES pertained to the construction of residential units for JCOs of the Indian Army - Hence such activity did not qualify as commercial in nature so as to attract service tax - Further the services provided to the Railways were found to be exempted by virtue of the Mega Exemption List - The findings of the Commr.(A) have been given independently based upon facts and law - The grounds raised by the Revenue to challenge the same are untenable - Hence the O-i-A merits being upheld: CESTAT

- Revenue's appeal dismissed : ALLAHABAD CESTAT

2019-TIOL-2106-CESTAT-CHD

CSJ Infrastructure Pvt Ltd Vs Commissioner of CGST

ST - The assessee-company is registered under Management of Business Consultant Services , Architect Services , Real Estate Agent Service , Maintenance of Repair Services , Construction Service other than Residential Complex including Commercial/Industrial Buildings or Civil Structures and Renting of Immovable Property Services - The assessee availed Cenvat credit on input services such as Commission paid on Brokerage, Consultant/Management & Consultancy Services, Man Power Supply/Security Services, Model Making of the Projects, Office Maintenance Charges and Office Rent in respect of Building taken on rent at Gurgaon and Professional Retainer Fees marketing relating to Shopping Mall, Website Management Charges, AMC & Pest Control - The Revenue sought to deny credit on grounds that the input services were not in relation to the output service of RIPS provided by the assessee - Hence the present appeal by the assessee.

Held - As per the definition of Input Service u/r 2 (l) of CCR, 2004 any service used for providing output services is entitled as input service - The Revenue does not contest that these services were not used by the assessee for providing output services - Law does not mandate one to one co-relation of the services received & services provided - It is not coming out from the facts as to which of the services used by the assessee pertain to which output services provided - Hence it cannot be alleged that the assessee is disentitled from availing Cenvat credit - The O-i-A merits being quashed: CESTAT

- Assessee's appeal allowed : CHANDIGARH CESTAT

CENTRAL EXCISE

2019-TIOL-2110-CESTAT-MUM

Oasis Alcohol Ltd Vs Commissioner of CGST

CX - During the first round of litigation, the matter had been remanded to the Commr.(A) to issue notice to the assessee-company to explain whether or not it really discharged mandatory pre-deposit - The present appeal contests the findings given by the Commr.(A) pursuant to such remand orders.

Held - The Tribunal had directed the assessee to examine the applicability of the Apex Court's ruling in Anjani Technoplast Ltd. Vs. Commissioner of Customs - The Commr.(A) concluded that such precedent case was inapplicable to the present case - However, the Commr.(A) omitted to mention how such a conclusion was reached upon - Hence the matter is fit for remand so as to decide afresh: CESTAT

- Case remanded : MUMBAI CESTAT

2019-TIOL-2109-CESTAT-AHM

Omkara Transport Pvt Ltd Vs CCE & ST

CX - Appeals are filed by M/s Omkara transport Pvt. Ltd., M/s Delite Cargo Carriers, Shri Rajesh Kumar Narula and Shri Ramesh Chawla against imposition of penalty in a case involving issue of fictitious documents showing transportation of goods - In so far as Omkara Transport Pvt. Ltd. and Delite Cargo Carriers are concerned, it is seen that the order of Tribunal did not cover the said two appellants and therefore, there was no remand directions in respect of these two appellants - Consequently, the impugned order could not have possibly dealt with the said appellants - Thus, the impugned order in so far as it relates to these two appellants is without jurisdiction and is, therefore, set aside - In so far as Rajesh Narula and Ramesh Chawla, is concerned, it is seen that the allegation against them is creation of fictitious documents and not actual carrying of goods - The penalty on these two is imposed under Rule 26 of CER, 2002 - The period involved is 2004-05 - At the material time, Rule 26 did not cover a situation where the person involved could be penalized for abating an offence in absence of any goods - Penalty against these appellant is set aside: CESTAT

- Appeals allowed : AHMEDABAD CESTAT

2019-TIOL-2108-CESTAT-ALL

Paradise Enterprises Vs CCE & ST

CX - The assessee is engaged in manufacture of Plastic Sheet Rolls (Plain), Plastic Sheet Rolls (Printed), Plastic Lay Flat Tubes, Plastic Bags and Pouches and their main raw material is Plastic Granules and Resin - They were availing the facility of Cenvat Credit of duty paid on various inputs and capital goods being used in manufacturing operations - Revenue entertained a view that the assessee was indulging in clandestine activities and the scribblings made in loose paper related to clearances of their finished product without payment of duty - The entire case of the Revenue is based upon the entries made in the loose sheets read with so called inculpatory statements of Shri Sanjeev Kumar and Shri Harmeet Singh - The Revenue has not investigated the matter further and has based his entire case on the basis of entries in loose papers only, the scribe of which is also not identified - Further reference to the so called inculpatory statement of Shri Harmeet Singh who is a co-assessee, even if considered to be confessional in nature, cannot be made the sole basis for arriving at the finding of clandestine removal unless the same is corroborated by independent evidences - The Supreme Court in case of Mahtesham Mohd Ismail 2007-TIOL-174-SC-FEMA has observed that confession, only if found to be voluntary and free from pressure can be accepted - There is no evidence, corroborating the Revenue's stand, no merits found in the impugned order - Accordingly the demand of duty made on the basis of recovered loose papers is not sustainable, same is set aside along with setting aside of penalty imposed upon the manufacturing unit to that extent - However, the part of demand is based upon the nine parallel invoices recovered and seized by officers from the assessee's factory - The assessee have nowhere contended that the said Central Excise invoices were recorded by them in their statutory records and no evidence to establish that is produced by them - As such, the duty in respect of said nine invoices is required to be confirmed against them along with confirmation of interest and imposition of penalty to that extent in terms of provisions of Section 11 AC - As regards penalty on Shri Harmeet Singh, inasmuch as the main demand against the manufacturing unit has been set aside, there is no justification in imposing penalty on him, especially, when no specific role stands attributed to him so as to show his involvement - Accordingly, penalty imposed upon him is set aside: CESTAT

- Appeals alowed : ALLAHABAD CESTAT

CUSTOMS

2019-TIOL-2105-CESTAT-MAD

Alliance Cellulose India Pvt Ltd Vs CC & CE

Cus - "Klabin Soft wood bleached kraft pulp - off grade" was imported under the Bill of Lading, the consignment had arrived at Tuticorin Port on 31.07.2017 - The importer having disowned the cargo, issued no objection letter to the shipper and also to the Revenue which led to the assessee's entry, who, vide letter informed the Revenue that they were willing to clear the goods after IGM amendment - Thereafter, assessee filed an application seeking waiver of late filing charges - The assessee is only a secondary importer/bona fide buyer who perhaps did not imagine the consequences of its late entry into the picture - It is not the case of revenue that KCP Karur who placed order for import i.e. principal importer, was only a name lender or that there was some understanding with it and the assessee which led to the withdrawal by principal importer citing financial hardship - Nor did the revenue suspect bona fides of principal importer, at any point in time, no doubts on the negotiations pleaded by the shipper/liner with the assessee and nor was there any doubts on the financial hardships pleaded by actual importer - If there are 2 different persons/entities, as in the case on hand one for "importation" and another for "clearance", then, one who clears should have control/hold/ownership rights over the goods sufficient enough to cause clearance - The two different events of "importation" caused by importer and the other "clearance" caused by a saviour, who was thrusted with the characteristic of importer at a much later stage - The satisfaction therefore, has to be looked into qua the assessee and not qua the original importer who is undoubtedly responsible for abandoning the import - Therefore, the moment such hold/control/ownership right to cause clearance vests in the other entity/person, does the time limitation starts in terms of proviso to S.46(3) - The delay thereafter, after the thirtieth day, is for the other person to explain and satisfy the officer or face the consequence thereof - Assessee is not the principal importer but a bona fide buyer and on the other, it is to be treated as a de facto importer by virtue of being responsible for 'clearance' of goods for home consumption in the capacity of 'any person holding himself out to be the importer' - The principal importer takes its own sweet time to take a decision whether to accept the import or not and finally decides to abandon its baby - Unclaimed imported goods would naturally become liable for auction if no one came forward to clear the same - That is an irresponsible act of importer who should alone answer or face the consequences - The principal importer may have sufficient reasons for all its acts and the consequent withdrawal may be the cumulative effect of all such reasons, but it certainly cannot lead a bona fide/innocent person into the perils of additional liabilities - Assessee would become liable only if there is any delay in filing BOE beyond thirty days from the date of it holding title/claim over the goods after IGM amendment - Matter is therefore remanded to the file of Adjudicating authority for this limited purpose: CESTAT

- Appeal partly allowed : CHENNAI CESTAT