| SERVICE TAX
2019-TIOL-2951-CESTAT-ALL
Mela Ram And Sons Vs CCE & ST
ST - Appellant is engaged in the activity of manual enlargement of photographs negatives and also runs Collection Centre for collection of exposed photo films received from various clients for getting same processed from different colour labs - enlargement of negatives is taxable but was falling within the small scale exemption limit and hence no tax was being paid - Revenue entertained a view that the collection of exposed photo films from their clients for the purpose of getting the same processed from different colour labs is also a service falling under the category of photography services - SCN issued for the period 2004-05 to 2008-09 and demand came to be confirmed along with penalty and interest - appeal to CESTAT.
Held: Board's Circular dated 27.12.2001 clarifies that the collection centre who merely collects the exposed film from their clients and gets it developed from other processing lab, will not be covered by the Photography Services - Though the appellant was having a photography studio, Bench is of the view that such activity of merely collecting and getting the negative processed from photo labs and further handing over the same to the customers, having been held as a non-taxable service by above circular of the Board, there could be a bona fide belief on the part of the assessee not to pay service tax on the said activity - appellant themselves approached the Board for clarification and as such it cannot be said that there was any malafide on their part so as to justifiably invoke the longer period of limitation - demand raised is hit by the bar of limitation - penalty set aside: CESTAT [para 5, 6]
- Appeal disposed of: ALLAHABAD CESTAT
CENTRAL EXCISE
2019-TIOL-2390-HC-GUW-CX
Commissioner of Central Goods and Service Tax Vs SRD Nutrients Pvt Ltd
CX - Whether the utilisation of CENVAT credit is permissible as per Rule 3(4) of CCR, 2004 for payment of pre-deposit in terms of Section 35F of CEA, 1944 - The Division Bench of High Court of Jharkhand in Akshay Steel Works Private Limited had held that there is no provision in 2004 Rules, which prohibits an assessee from adjusting CENVAT credit against requirement of making a pre-deposit in an appeal preferred under Section 35F of the 1944 Act - Similar view was also taken by Division Bench of High Court of Gujarat in Cadila Health Care Private Limited 2018-TIOL-1236-HC-AHM-CX - As the aforesaid judgements in Akshay Steel Works Private Limited and Cadila Health Care Private Limited had not been assailed before Supreme Court and as the current litigation policy also restricts filing of appeal, value of which is less than Rs. 1 Crore, before the High Court, no good ground found to admit the appeal and accordingly, the same is disposed of: HC
- Appeal disposed of : GAUHATI HIGH COURT 2019-TIOL-2950-CESTAT-ALL
CCGST Vs Metenere Ltd
CX - CENVAT credit was availed by the assessee on the basis of three invoices issued by the head office which is registered as ISD - Revenue is not finding fault with the correctness of the said three invoices but alleges that the credit availed by the head office is inappropriate - demand notice issued and confirmed - appeal to CESTAT.
Held: Proceedings were required to be initiated against the head office and not against the present appellant - Admittedly, the appellant would not be in a position to explain the correctness or otherwise of the credit availed by the head office, for which records are being maintained at the head office only - Further the head office, as a registered ISD, is required to file returns etc. to their jurisdictional Service Tax Authorities - No objection seems to have been raised by the jurisdictional Service Tax Authorities of the head office - It is well settled law that assessment made at the end of the service provider cannot be re-opened at the end of the service recipient by resorting to objection relatable to the service provider - No justification for denial of credit to the appellant: CESTAT [para 8]
CX - Appellant's factory was visited by the officers on 05/08/2014 whereas show cause notices have been issued on 30/03/2016 - entire facts were being reflected by the appellant in their statutory records from August, 2013 onwards - no justification for invocation of the extended period of limitation - appeal allowed with consequential relief: CESTAT [para 10, 11]
CX - Revenue is in appeal against the order dropping the penalty on the Managing Director.
Held: Although Revenue is contesting non-imposition of penalty on the Managing Director, but the appeal stands filed by showing the manufacturer as respondents - In any case, as the demand against the manufacturer stands set aside alongwith setting aside of penalty imposed upon them, Revenue's appeal seeking imposition of penalty on the Managing Director is not maintainable - Revenue appeal is, therefore, rejected: CESTAT [para 12]
- Assessee appeal allowed/Revenue appeal rejected: ALLAHADBAD CESTAT
2019-TIOL-2949-CESTAT-AHM
Meghmani Organics Ltd Vs CCE
CX - Appellant had imported the goods by classifying the same under Chapter 31 of the Customs Tariff - said goods were re-packed in smaller packs under brand name 'Megaboost' - It was alleged by Excise Authority that the said goods were not fertilizer as claimed but are classifiable under Chapter 29 and, therefore, were liable to be assessed to duty - appellant paid duty under protest and later claimed refund which was denied - appeal to CESTAT.
Held: Appellant has claimed that the product is mixture of goods whereas the test report describes the product as 'Coordination Compound' and not as a mixture - Chapter 29 covers all separate chemical define organics compound - The Note 2 of Chapter 29 excludes only Urea falling under heading 3102 or 3105 from the purview of Chapter 29 - A combined reading of Chapter Note 1 of Chapter 29 and Chapter Note 2(e) of chapter 29, Chapter Note 1 (b) of Chapter 31 and Chapter Note 6 of Chapter 31 shows that separately defined compound which might answer to Chapter 6 would not be classifiable under Chapter 31 - decisions in case of Ciba India Ltd - 2009-TIOL-246-CESTAT-MAD and in own case are per incurium as they have failed to examine the aforesaid Chapter Notes before reaching the conclusion - Customs and Excise Authority are totally independent authority and mistake by one need not be carried out or followed by another - no merit in appeal, hence dismissed: CESTAT [para 8 to 11]
- Appeal dismissed: AHMEDABAD CESTAT
2019-TIOL-2948-CESTAT-AHM
Mehsana District Cooperative Milk Producers Union Ltd Vs CCE & ST
CX - Appellant availed CENVAT credit on entire quantity of Furnace oil received in their factory which was used for producing steam and the steam in turn was used for various process of manufacture of dutiable and exempted goods - show cause notices issued for recovery of credit involved in such quantity of inputs used in manufacture of exempted goods for the period July 2001 to May 2005 - demand confirmed and upheld by Commissioner(A) - Appellate Commissioner vide impugned order dismissed the appeal filed by the Appellant holding that appellants have not produced any evidence regarding quantity of steam used in dutiable and exempted goods even after grant of time - appeal before CESTAT.
Held: Insofar as the reliance placed by the appellant on the decision in their own case, in tax matters the principle of res judicata is not applicable - Following the Apex Court judgment in case of Gujarat Narmada Valley Fertilizers Co. Ltd. - 2009-TIOL-96-SC-CX and Maruti Suzuki Ltd. - 2009-TIOL-94-SC-CX , Bench holds that the Appellants are not entitled to the credit of Furnace oil which is used in manufacture of exempted goods - However, case is remanded back to the adjudicating authority to ascertain the quantum of credit to be reversed/paid based upon the actual use of quantity of such input in exempted goods: CESTAT [para 4, 5]
- Matter remanded: AHMEDABAD CESTAT
CUSTOMS
2019-TIOL-2391-HC-MAD-CUS
JJ Graphics Vs CC
Cus - The issue involved is squarely covered by interim order of Division Bench of this Court made in W.P. dated 10.09.2019 - It is seen that some of those writ petitions before Division Bench are filed seeking for declaration to declare Para 2.31 of Foreign Trade Policy (2015-2020) issued by DGFT as ultravires, unconstitutional and without jurisdiction insofar as it requires authorization for Import Clearance of Secondhand Digital Multifunction Print and Copying Machines - It is seen that the above Writ Petitions are pending, however, by granting provisional release of goods, so detained, by way of an interim measure - Since these writ petitions are filed only for provisional release of goods and in view of the fact that the Division Bench has granted such relief in those cases by way of interim order, subject to the condition imposed, these Writ Petitions are disposed of - The petitioner in each writ petition shall pay the disputed amount in cash to the competent authority - The petitioner is also directed to pay the duty applicable on the enhanced value as determined by the Chartered Engineer - The goods detained by respondents shall be released within a period of seven days from the date of payment - Till the date of release of goods, demurrage charges be waived: HC
- Writ Petitions disposed of : MADRAS HIGH COURT
2019-TIOL-2379-HC-AHM-CUS AVN Commodities Pvt Ltd Vs UoI
Cus - The petitioner invited the attention of the court to the provisions of section 12 of Customs Act, 1962, to submit that this is the charging section which provides for levy of duties of customs on goods imported into or exported from India - It was submitted that vide Customs Notfn 1/2017-Customs (CVD), definitive countervailing duty on imports of certain hot rolled and cold rolled stainless steel flat products originating in, or exported, from the China came to be imposed - It was submitted that, since as on the date when the goods came to be imported, there was no levy of definitive countervailing duty on import of the said goods, even under the provisions of clause (b) of sub-section (1) of section 15, the petitioner would not be liable to pay definitive countervailing duty on the import of such goods - The attention of the court was invited to a decision of Madras High Court in case of Leitwind Shiram Manufacturing Ltd. to submit that the court in the said decision has held that as per section 15(1)(b) of the Customs Act, in the case of goods cleared from a warehouse under section 68, the rate of duty and tariff valuation, if any applicable to any imported goods, shall be the rate and valuation in force on the date on which a bill of entry for home consumption in respect of such goods is presented under that section - It was submitted that in view of the said decision of the Madras High Court which is the only decision in respect of the provisions of section 15(1)(b) of the Customs Act, the respondent authorities would be bound to follow the said decision, which is contrary to the settled law as laid down by the Supreme Court as well as the other courts in the above referred decision - Having regard to the submissions advanced by petitioner, Issue Notice returnable on 13th November, 2019: HC
- Notice returnable: GUJARAT HIGH COURT | 
