SERVICE TAX

2019-TIOL-2310-CESTAT-ALL

ST - The assessee was providing construction services to Ghaziabad Development Authority alongwith paying service tax on the said activities - The proceedings were initiated against assessee proposing to deny refund claim on the grounds that the services provided by them to Ghaziabad Development Authority were not works contract and refund claim is hit by bar of limitation - In the letter dated 14/12/2010, which is being referred to and relied upon by revenue, there is no signature of any authorized representative of Revenue showing the receipt of the same - It is explained that inasmuch as the assessee used the expression "under protest" on the challans depositing duty amount, which were between the period 11/12/2010 to 13/12/2010, their jurisdictional range authorities advised the assessee to withdraw the protest - The assessee under pressure and under the fear of said advice given by officers wrote a letter on 14/12/2010 itself i.e. on the next date of deposit of amounts withdrawing their protest - When the said letter was taken to the office of Superintendent, he did not accept the same and the said letter was returned to them - The Lower Authorities have not advanced any evidence to show that the said letter was actually filed by them - On the contrary, Commissioner (A) has observed that the assessee has not produced any evidence to establish that the same was not filed - Apart from fact that there is no evidence of receipt of said letter in the office of Superintendent or Assistant Commissioner, the said letter has to be interpreted as being under coercion and pressure from the Revenue and not from free will of assessee - As such, the duty having been deposited under protest in challans itself, the refund claim cannot be held to be barred by limitation - However said refund claims are sustainable only if the assessee's services to Ghaziabad Development Authority fall under category of 'works contract' - The said aspect requires verification and examination by Lower Authorities - Accordingly for the said limited purpose, matter is remanded to the Original Adjudicating Authority: CESTAT

- Matter remanded: ALLAHABAD CESTAT

2019-TIOL-2309-CESTAT-DEL

ST - The assessee is engaged in providing taxable services falling under category of Cargo Handling Service - Department noticed that the assessee is providing services of cargo handling about handling soya seeds, DOC and coal in the factory premises and for local transport from the factory to Mandideep Railway Station for loading in the racks but they have not paid the appropriate service tax despite that the services of cargo handling have been made taxable w.e.f. 16.08.2002 - Resultantly, vide a SCN, the service tax for the period w.e.f. 2007-08 to 2011-12 was proposed to be recovered alongwith interest under Section 75 of the Finance Act and the penalties under Section 76, 77 and 78 thereof - The main contention of assessee is that the activity rendered by him is mainly of transportation that too not even being a GTA - The opening line makes it clear that the contract is for transportation and loading of cargo from factory at Mandideep to railway goods shed - The contract has 13 terms therein - Cumulative reading and the apparent interpretation, is that the contract was entered into with an intention for the products of M/s Bhaskar Exxoils Pvt. Ltd. to be transported from their factory to the railway shed - It is also apparent from the contract that in fact the goods were loaded from the factory into the trucks of assessee and were directly transferred to the railway wagons except in case of delay where an additional charge of Rs. 1 per bag has been agreed to be paid for the labour charges - It becomes clear that the activity actually is of trans-shipment of goods through the trucks of assessee - Loading thereof was merely incidental - Coming to the second aspect of adjudication, apparently and admittedly, the value relied upon by the Department does not merely include the transport/freight charges rather in addition includes charges as that of freight on DOC (rate), freight on soya seed purchased (agricultural produce) - Further, it is observed that these freights are for the movement of the soya seed, produced, within the factory premises - The law has already been settled that the movement of goods within the factory premises cannot be classified as the service of cargo handling - Inclusion of all such prices in the impugned demand is therefore highly unjustified on the part of the adjudicating authorities - The factum of the bifurcation of amount received is also apparent from the statement of Shri MP Singh, Manager Finance of M/s Bhaskar Exxoils Pvt. Ltd - The said statement has duly been relied upon by the Department itself as is apparent from the SCN - The silence of adjudicating authority qua the said clarification is therefore opined unreasonable - The second controversy also stands decided in favour of assessee - The demand is otherwise observed as being barred by time except for the one year thereof, period of demand being 2007-08 to 2011-12 and SCN being of October 2012 - There is no apparent evasion on the part of assessee - The taxable service stands already been paid under reverse charge mechanism by M/s. Bhaskar Exxoils Pvt. Ltd., the recipient of transport service - Seeing from this angle as well, the demand confirmed is not sustainable: CESTAT

- Appeal allowed: DELHI CESTAT

CENTRAL EXCISE

2019-TIOL-2313-CESTAT-HYD

Central Excise - T he allegation in SCN with respect to invocation of extended period of limitation is that the assessee has suppressed the fact that they have availed CENVAT Credit on the invoices in contravention to Rule 9(1) of CCR, 2004 on the department inasmuch as they did not indicate so in their ER.1 returns - They have also not provided copies of the invoices along with returns - Thus, there was a suppression of fact and extended period of limitation is invoked - The lower authority has held that there was suppression of fact in this case and therefore imposed penalty - As the department is now insisting on imposition of penalty on the ground that once extended period of limitation is invoked, penalty cannot be set aside, Tribunal proceed to decide this question of extended period of limitation.

Held: It is not in dispute that the assessee has availed CENVAT Credit in contravention of Rule 9(1) of CCR, 2004 as it stood during the relevant period - They did not submit invoices for details of CENVAT Credit availed in their E.R 1 returns - The SCN alleges that this amounts to suppression of facts - It is a well settled principle that to allege suppression, it must be shown that something which has to be disclosed by assessee has not been disclosed - There is no requirement of providing copies of invoices along with E.R 1 returns - Therefore, it cannot be held that the assessee had suppressed the facts from department - Violation of rule 9(1) is established but there is no evidence of intent to evade - Therefore, the extended period of limitation cannot be invoked - There is no doubt that there was contravention of Rule 9(1) as it stood during the period but apart from the allegation that there was an intent, there is nothing in the entire SCN to show for support of this allegation of malafide intention - Therefore, in the SCN itself, there is no ground to invoke the extended period of limitation - In fact, the respondent could have contested the demand itself instead of reversing the amount, however they did not contest and chose to pay the time barred demand - There were no elements necessary for invoking extended period of limitation in this case - Therefore, the burden referred to by the Revenue in their appeal has not been crossed by Revenue - The demand itself is time barred - However since there is no appeal of the revenue regarding demand in this case, no order is being passed regarding the demand - As far as the mandatory penalty is concerned, since the element necessary for invoking the extended period of limitation was absent in the SCN itself, no penalty can be imposed upon assessee: CESTAT

- Appeal rejected: HYDERABAD CESTAT

2019-TIOL-2312-CESTAT-KOL

CX - The issue involved is regarding availment of credit on box HS wagon classifiable under Chapter Heading 86069290 treating them as capital goods - The capital goods has been defined under Rule 2(a)(A) of CCR, 2004, where certain goods have been specified by classification as well as by description and such goods are required to be used in factory of production of final product - From the perusal of definition of "capital goods", it is evident that the box HS wagon is classifiable under Chapter Heading 860692.90 which is not excluded from the definition of "capital goods" - It is the contention of assessee that the said credit has been availed by them on capital goods i.e. box HS wagon, which has been procured and handed over to the railways authority for transport of their input as well as output - It is on record that the assessee is manufacturing goods, which are being transported by railways to their customers - On account of shortage of box HS wagon admittedly supplied, they have procured the box HS wagon, which are being used by assessee - Although, they have reversed the cenvat credit initially on these box HS wagon under the mistaken belief that the same are not covered within the purview of capital goods and accordingly, they have reversed the cenvat credit before issue of the impugned SCN and interest thereon after issuance of SCN - Not being satisfied with reversal, the Department has demanded the penalty under provisions of Section 11AC of CEA, 1944 r/w Rule 15 (1) of CCR, 2004 - The box HS wagon are being used for procurement of inputs as well as dispatch of output product from their factory - Going by the definition of capital goods, it can be seen that there is no bar on the use of product as capital goods, merely that the assessee has reversed cenvat credit and interest thereon will not deprive from the substantive right for availing cenvat credit within CCR, 2004 - Accordingly, the impugned order is set aside: CESTAT

- Appeal allowed: KOLKATA CESTAT

2019-TIOL-2311-CESTAT-AHM

Sandvik Asia Ltd Vs CCE & ST

CX - The assessee cleared their finished goods claiming exemption under Notfn 06/2006-C.E. - As per condition no.19 of notification, as regard, exemption from customs duty the assessee have not fulfilled condition no. 19, in as much as Clause(C) of condition No. 29 of Notification under 21/02-Cus read with serial no. 214 has not been fulfilled by assessee, accordingly the demand was confirmed by denying the exemption Notfn 06/2006-CE - As per Notfn 21/2002-Cus, the goods supplied by assessee is admittedly exempted when imported into India, therefore, both the conditions stand fulfilled - The contention of Revenue is that the assessee should fulfill all the conditions prescribed for purpose of exemption Notfn 21/2002- Cus - The Notfn 06/2006-C.E does not prescribe any condition that condition provided for custom notification should be complied with by the assessee who manufacture and supply the goods indigenously under Notfn 06/2006-C.E - The only condition is that the goods supplied by assessee are exempted from custom duty which is not under dispute as per Notfn 21/2002-Cus. - From the reading of condition 29 of Notfn 21/2002-Cus, it is clear that the said condition is required to be fulfilled only in case goods are imported, therefore the said condition cannot be mutatis mutandis applied in case of goods indigenously supplied - So far the assessee's supplies is against the international competitive bidding and the goods are exempted from custom duty, if imported into India, the assessee is entitled for exemption Notfn 06/2006- C.E. - Accordingly, the impugned order is not sustainable, hence, the same is set aside: CESTAT

- Appeal allowed: AHMEDABAD CESTAT

CUSTOMS

P Perichi Gounder Memorial Charitable Trust Vs CC

Cus - Confiscation ordered of 'Used Baxter Aurora Dialysis Machine with Supplies and Accessories' with an option to redeem the same on payment of redemption fine and a penalty imposed - petitioner before High Court.

Held: There is no disputation or disagreement before this Court that writ petitioner had paid the redemption fine of Rs.1,00,000/- besides the penalty of Rs.20,000/- as imposed by the original authority - It comes to light that import of the petitioner is for a hospital which is being run for economically less privileged strata of the society and it provides medical help by charging only actual cost of basic disposable products alone - In other words, for all practical purposes, writ petitioner is providing free medical treatment with a 50 bedded hospital and in instant case, consignment imported itself is a Used Dialysis Machine - In the light of the unique and peculiar facts and circumstances of this case, respondents are directed to ensure that the addressees in the communication, signed on 25.04.2018, give effect to the same and ensure that the consignment namely Used Dialysis Machine, which is subject matter of instant writ petition is given delivery to the writ petitioner without insisting on demurrage and detention charges even post 23.03.2018 - above direction shall be complied with by the respondents as expeditiously as possible and in any event, with a period of four(4) weeks from the date of receipt of a copy of this order - Petition disposed of: High Court [para 22, 23]

- Petition disposed of:: MADRAS HIGH COURT

2019-TIOL-2308-CESTAT-DEL

Cus - Bench should not be hearing this matter because similar matters were heard by another Bench and orders are reserved - All these appeals are dismissed for non-prosecution: CESTAT

- Appeals dismissed: DELHI CESTAT