2019-TIOL-NEWS-287, Dated: Friday, December 06, 2019

ST - The appeal has been filed by assessee against confirmation of demand of service tax in respect of amounts received under heads; Brokerage Income (Steamer Freight), Air Commission, Special Commission/Brokerage and Net Taxable Brokerage/ Commissioner - The assessee have contended that the brokerage and special commission/incentive is an income received in activity of trading of freight space in various shipping lines - They have argued that the said issue is covered by decision of Tribunal in case of Continental Carriers - 2017-TIOL-3964 CESTAT-DEL and also in the case of Karam Freight Movers - 2017-TIOL-907-CESTAT-DEL - Following the ratio of aforesaid decision, no merit found in the impugned order as far as it relates to demand of Service Tax on brokerage and Commission income received from the shipping lines and sale and purchase of freight space - It is noticed that Commissioner (A) in his order, in respect of Air Commission has set aside the penalty - Having held that there was a reasonable cause for non-payment of duty, it is found just and proper to set aside the invocation of extended period of limitation also - Consequently the demand is set aside: CESTAT

ST- Issue is leviability of tax as provider of 'support service of business or commerce', as defined in section 65(104c) of Finance Act, 1994, on the charges collected by appellants for getting the vehicles sold by them registered under the Motor Vehicles Rules and obtaining of smart card and similar documents for the buyers.

Held: Issue is covered by the decision of the Tribunal in Kundan Cars Pvt Ltd v. Commissioner of Central Excise, Pune - I - 2017-TIOL-2860-CESTAT-MUM where it is held that service in question is not covered under "Business Support Service" - following the said decision, impugned orders are set aside and appeals are allowed: CESTAT [para 4, 5]

CX - Appellants are engaged in the activity of construction and commissioning of transmission line and sub-station for transmission of electricity and had executed 'Talcher Project', which was approved by the Government of India - Appellant had approached the World Bank for financing of the said project but sanction of the loan from the World Bank was delayed - In the meantime, the appellant had received various manufactured goods from M/s EMI Transmission Ltd. availing exemption from payment of duty under Notification No. 108/95-CE dated 28.8.1995 during the relevant period from Sept, 2000 to July, 2001 - Appellants were also entitled to exemption of the terminal excise duty as one of the Deemed Export benefit, under the policy in terms of the Public Notice issued by the Ministry of Commerce dated 01.07.1999 - Since the sanction of the World Bank loan got delayed, the appellant had deposited the entire amount of terminal excise duty benefit in October, 2002 - Consequently, on receipt of the World Bank loan, the appellant had filed refund claims of the terminal excise duty deposited with the Government of India after obtaining the necessary No Objection from M/s EMI Transmission Ltd. - In the meantime, the Department had issued a show-cause notice on 26.9.2005 to M/s EMI Transmission Ltd. and also to the appellant for recovery of Rs.2,79,47,481/- by proposing to deny benefit of Notification No. 108/95-CE and also to appropriate the amount of Rs.77,95,953/- paid - Commissioner dropped the proceedings initiated against M/s EMI Transmission Ltd. and the appellant vide Order-in-Original dated 23.4.2009 - Consequent to the said order, the appellant claimed refund of the entire amount of Rs.77,95,953/- paid by them in October, 2002 - refund amount was sanctioned and it was received on 16.6.2010 - Commissioner (Appeal) allowed the Revenue's appeal by setting aside the order of refund - show-cause notice was also issued to the appellant on 3.3.2011 for recovery of the refund amount of Rs.77,95,953/- sanctioned and paid to them - The said demand notice was adjudicated confirming the demand with interest and penalty and hence, the present appeals before CESTAT.

Held: Tribunal in the appellant's own case of Power Grid Corporation of India Ltd. Vs. CCE - 2017-TIOL-2281-CESTAT-AHM had in similar circumstances allowed their appeals by upholding the order of Commissioner(A) granting refund - There is no reason in not accepting the aforesaid observations of this Tribunal - consequently, impugned orders are set aside and the appeals are allowed with consequential relief: CESTAT [para 5, 6]

CX - CENVAT credit of duties/tax paid on inputs/input services deployed/utilised for construction of the commercial property which was then leased out and, on the rental of which, tax liability as provider of 'renting of immovable property services' have been discharged, has been denied to the appellant in the impugned order - assessee is in appeal before CESTAT.

Held: Impugned order is not legal and proper in view of the overwhelming opinion of judicial rulings in the cases of Musaddilal Projects Ltd v. Commissioner of Central Excise, Customs & Service Tax [2017 (4) GSTL 401 (Tri.-Hyd.)] - 2017-TIOL-2304-CESTAT-HYD , Maharashtra Cricket Association - 2015-TIOL-2418-CESTAT-MUM , Oberoi Mall Ltd - 2016-TIOL-704-CESTAT-MUM , Nirlon Ltd. 2016-TIOL-1571-CESTAT-MUM - appeal allowed : CESTAT [para 4 to 7, 9, 10]

CX - On the basis of the entries in the register it was alleged that the appellants have clandestinely purchased texturized yarn, 43920.310 kgs under 7 bills, and have cleared dyed yarn made out of the same without payment of duty - demand confirmed in denovo proceedings and said order upheld by Commissioner(A), hence assessee before CESTAT.

Held: It appears that the allegation is built up by the department only on the basis of the sales register, delivery orders and ledger of the supplier of texturized yarn - This is, at best, a third party evidence and there is no corroborative evidence is placed on record to show that the said white yarn has been received by the appellants and further used in the manufacture and clearance of excisable goods - Though it can be argued that the cases of evasion cannot be proved with mathematical precision, at the same time the same cannot be sustained with a single evidence that too found in some other premises - The charge of clandestine removal is a serious charge and requires to be substantiated by completing the chain of procurement of raw material, use of other raw material, electricity consumption, labour charges, manufacture of final products, sale of final products, transportation of final product and financial transaction - original authority as well as the Appellant Authority have given a finding that the appellants have approached the Settlement Commission in respect of another show cause notice emanating from the same set of evidence and thus the appellants are habitual offenders - Such a conclusion based on the history of the appellants cannot be sustained - As the charge of clandestine removal is held to not sustainable, there is no need to go into the merits of alternate arguments as submitted by the appellants - appeals are allowed: CESTAT [para 5, 6, 8, 9]

CX - Cases relied upon by AR do not have the same set of comparable facts - Supreme Court in the case of Toyota Kirloskar Motor Pvt. Ltd. - 2007-TIOL-94-SC-CUS held that the ratio of the decision must be culled out from the facts involved - In a given case a decision, as is well known, is an authority for what it decides and not what can logically be deduced there from: CESTAT [para 7]

Cus - Revenue has assailed the impugned order on the ground that non-imposition of penalty on the noticees under Section 114A of the Customs Act, 1962 is contrary to the statutory provisions and accordingly, the impugned order is liable to be set aside - Show cause proceedings initiated by DRI were adjudicated vide the impugned order dated 28.02.2012, wherein by rejecting the declared value of imported poppy seeds, the assessable value of the imported goods was enhanced and differential duty was confirmed on the respondents; that the Tribunal had set aside the adjudication orders and allowed the appeals on merits with consequential reliefs - since the adjudged demands themselves have been set aside by the Tribunal vide order dated 20.10.2015, prayer made by Revenue for imposition of penalty under Section 114A ibid cannot be sustained - appeal dismissed: CESTAT [para 3 to 5]