SERVICE TAX

2019-TIOL-309-SC-ST

CST Vs Vodafone Mobile Services Ltd

ST - The CENVAT credit is admissible on Towers, shelter and accessories used for providing telecom services - CESTAT LB decision - 2016-TIOL-539-CESTAT-DEL-LB - reversed - The High Court allowed the assessee's appeals.

Held - Delay condoned - The Revenue's SLP is dismissed on account of low tax effect involved in the matter - Nonetheless, the question of law is left open - Pending interlocutory applications are dismissed as well: SC

- Revenue's SLP dismissed: SUPREME COURT OF INDIA

2019-TIOL-2153-CESTAT-MUM

Aarti Infra Projects Pvt Ltd Vs CCE & ST

ST - The assessee provides services classifiable under erection, commissioning and installation services and 'works contract' services during the relevant period - Scrutiny of records suggested that the assessee had not been discharging service tax on such services - The assessee later filed an application under the VCES 2013, although the same was rejected - An SCN was issued proposing to raise duty demand with interest & penalty - On adjudication, the same was confirmed and such findings were sustained by the Commr.(A) - Hence the present appeal.

Held: The assessee requested for an opportunity to demonstrate that major portion of the work undertaken by them was either on sub-contract basis or related to execution of projects connected with dams and hydro-power projects - On account of the same, the assessee claimed that the same were not taxable - Hence the matter warrants remand to enable the assessee to place the requisite work orders and contract orders before the adjudicating authority: CESTAT

- Case remanded: MUMBAI CESTAT

CENTRAL EXCISE

2019-TIOL-2152-CESTAT-HYD

India Cements Ltd Vs CCT

CX - The assessee-company was served SCN during the relevant period, proposing to recover Cenvat credit u/r 14 of CCR 2004 r/w Section 11A(54) of the CEA 1994, with interest - Penalty u/r 15(2) of CCR 2004 r/w Section 11AC of CEA was also proposed - Such credit had been availed in respect of service tax paid on supply of tangible goods and services, which included renting of porclainers and tippers - On adjudication, the duty demands & penalty were confirmed - On appeal, the Commr.(A) sustained such findings - Hence the present appeal by the assessee.

Held: Limitation - The SCN for the period April-June 2012 was issued in February 2015, which is well beyond the normal period of limitation - There is nothing in the SCN to show that the assessee committed any fraud or colluded or mis-stated or suppressed facts - While it is alleged that the assessee contravened the provisions of the Act or Rules, but there is no mention of any intent to evade payment of duty - Hence invoking extended period of limitation is unwarranted & the SCN merits being quashed on account of being time barred: CESTAT

Held: Rule 2(l) as it stood during the relevant period, specifically excluded motor vehicles which are not capital goods - Hence the assessee could not have availed Cenvat credit on service tax paid on hire charges for the vehicles in question - Usually, dumpers and tippers are registered as motor vehicles & there is no contrary indication in the records - Once registered with the Motor Vehicles Department, they cannot cease to be motor vehicles thereafter - The specific inclusion of dumpers and tippers as capital goods under CCR 2004 excluded goods falling under Chapter 87 of the CETA 1985 - Hence the demands is sustainable on merits - However, the SCN was issued after limitation period without allegation or evidence of fraud or collusion - Hence the demand is time-barred: CESTAT

- Assessee's appeal allowed: HYDERABAD CESTAT

2019-TIOL-2151-CESTAT-MAD

CCE Vs Karur Kcp Packagings Ltd

CX - Assessee is engaged in manufacture of FIBC woven fabrics/cut pieces made of Polypropylene (PP) granules classifying them under CETH 54072090 - The original authorities have concluded that the impugned goods are classifiable under CETH 39269080 on the premise that they are "plastic fabrics made out of the same raw materials as that of PP bags"; that right from the beginning the assessee have manufactured PP bags classifiable under CETH 39232990 - There is no dispute on the classification of PP bags under Chapter 39 of CETA - The Judgment of Apex Court in Pramact Plastics Pvt. Ltd. also has affirmed the decisions of Tribunal and the High Court in Rajpack Well in this regard - However, the impugned goods are not plastic PP bags but only FIBC woven fabrics/cut pieces - No infirmity found in the order of lower appellate authority holding that the impugned goods are correctly classifiable under CETH 5407 2090 and not under CETH 3926 9080: CESTAT

- Appeals dismissed: CHENNAI CESTAT

2019-TIOL-2150-CESTAT-AHM

Jayant Agro Organics Ltd Vs CCE & ST

CX - Assessee is in appeal against change of classification of their products from Chapter heading 2915 and 2916 to Chapter heading 3823 - The dispute relates to the products namely "12 Hydroxy Stearic Acid" which the assessee were classifying under Chapter heading 2915 as saturated acyclic monocarboxylic acids - The second product is "Ricinoleic Acid" which the assessee is classifying under Chapter heading 29.16 as unsaturated acyclic monocarboxylic acids - In this regard, reliance is placed on Chapter note 1(a) which clearly holds that separately defined organic compounds are to be decided in Chapter 29 even if they contains impurities - The treatment to be given to mixtures of isomers is clarified in Chapter note 1(b) - In the instant case, the mixtures is not as isomers and are different acids and not isomers - The criteria for classification would be percentage of "Ricinoleic Acid" and "12-Hydroxy Stearic Acid" - If the exclusion clause applied to Chapter heading 2915 and 2916 to the facts, it transpires that the product containing less than 90% of "Ricinoleic Acid" or "12-Hydroxy Stearic Acid" would be classifiable under Chapter 3823 and not under Chapter 2915 or 2916 - In this circumstance, merit found in the appeal filed by assessee - The revenue has sought to rely on the fact that the subject heading 2915 70 40 specifically includes "12-Hydroxy Stearic Acid" - In the light of exclusion clause, if concentration of "12-Hydroxy Stearic Acid" is above 90%, the product will be classifiable under Chapter 29, otherwise not - Consequently, merit found in the appeal and the same is allowed: CESTAT

- Appeal allowed: AHMEDABAD CESTAT

CUSTOMS

2019-TIOL-310-SC-NDPS

Vijay Pandey Vs State Of UP

NDPS - Appellant assails his conviction and sentence under Sections 8 and 15 of the of the NDPS, 1985 for 15 years along with fine of Rs.1,50,000/- under Section 31 of the NDPS Act - Appellant is stated to have been carrying a plastic flour packet in his right hand leading to recovery of 10 kgs. of opium - Counsel for the State submits that the appellant has a previous history of two convictions under the NDPS Act and he is a habitual offender.

Held: Seizure was at 06.40 AM at the door step of the appellant - Bench finds it difficult to believe that in a rural residential locality, the police were unable to find a single independent witness - No name of any person has been mentioned who may have declined to be a witness - The High Court, despite noticing the absence of any recovery memo prepared at the time of search and seizure under Section 50 of the NDPS Act, opined that the deposition of the police witness to that effect was sufficient compliance - Though the Laboratory Report was obtained, but the identity of the sample stated to have been seized from the appellant was not conclusively established by the prosecution - accused had raised an objection regarding the sample produced in Court not having been established as seized from him - Trial Court opined that "the malkhanas in the State of Uttar Pradesh were in miserable condition and strange and objectionable thing come to the eyes"; that the plastic packet produced was of very low quality and the quality of ink used in writing the name of the accused on the same was not decipherable and may have got erased with passage of time; that nonetheless, since the allegations against the appellant had been proved by the witnesses, the failure to conclusively identify the sample produced as having been seized from the appellant was inconsequential - Unfortunately, the High Court did not deal with this aspect of the matter at all - The fact of an earlier conviction may be relevant for the purpose of sentence but cannot be a ground for conviction per se - failure of the prosecution in the present case to relate the seized sample with that seized from the appellant makes the case no different from failure to produce the seized sample itself - In the circumstances the mere production of a laboratory report that the sample tested was narcotics cannot be conclusive proof by itself - The sample seized and that tested have to be corelated - Court is, therefore, unable to uphold the conviction of the appellant - The conviction by the Trial Court and upheld by the High Court are unsustainable and are accordingly set aside - The appellant is acquitted and is directed to be released forthwith unless wanted in any other case - Appeal is allowed: Supreme Court [para 5, 6, 8, 10, 11]

Appeal allowed: SUPREME COURT OF INDIA

2019-TIOL-2149-CESTAT-AHM

BGH Exim Ltd Vs CC

Cus - Whether the goods namely "Base Oil SN-500" imported by assessee from Iran should be valued at declared price of US $ 400 PMT as against the departments claim of US $ 450 PMT as per NIDB data - There is no dispute on the fact that the assessee have imported 4000 MTs of base oil and the price on the basis of NIDB data applied is for not more than 500 MTs - It is also observed that the lower authority have not gone into the quality parameter of goods imported by assessee and the goods involved in contemporaneous bill of entry, therefore, due to the higher quantity imported by assessee, the NIDB data of meagre quantity cannot be applied - This has been considered by Tribunal’s special Bench judgment in case of Shah and Shantibhai - On the basis of said decision, it is clear that for applying the NIDB data quantity of the import should be same - On the basis of contemporaneous import the value cannot be enhanced in the present case - Accordingly, the impugned order is set aside: CESTAT

- Appeal allowed: AHMEDABAD CESTAT