| SERVICE TAX 2019-TIOL-3574-CESTAT-MUM
Kailash Chand Jain Vs CCGST
ST - Appellant entered into agreement with the developer of residential complex for purchase of flat vide agreement dated 13.3.2015 - inasmuch as completion certificate was not issued to the said building, ST was charged by the Developer and subsequently deposited with the exchequer - appellant, under a belief that no ST was payable inasmuch as the building was otherwise complete, filed refund of ST to the extent of Rs.6.67 lakhs - the appellant's refund claim was rejected - appeal to CESTAT.
Held: On going through the definition of declared services, it is found that the same lays down the criteria of issuance of completion certificate by the competent authority - no merit found in the contention of the appellant that the said certificate was not issued on account of non-functioning or delayed functioning of the State Environment Appraisal Committee - appellant submitting that inasmuch as the agreement was entered into on 13.3.2015 and the completion certificate issued on 7.9.2015, the services, at the most can be said to have been provided only w.e.f. 13.3.2015 till the date of issuance of completion certificate - appellant relied upon the Supreme Court judgment in the case of Larsen & Toubro Ltd. & Anr. - 2013-TIOL-46-SC-CT-LB - impugned order set aside and remanded to the original adjudicating authority for consideration of the said decision of the Supreme Court and to re-decide the matter accordingly: CESTAT [para 4, 5, 6]
- Matter remanded: MUMBAI CESTAT
Imperial Granites Pvt Ltd Vs CC, CE & ST
ST - The assessee, a 10% EoU engaged in manufacture and export of granite slabs and tiles, is registered with the Service Tax Department under the heading GTA services - The Department observed that the assessee engaged foreign commission agents to procure business for itself - The Department opined that promotion on marketing or sale of goods produced or provided by or belonging to a client is classifiable under BAS u/s 65(19) of the Finance Act 1994 and that the assessee was liable to pay service tax on the commission amount on reverse charge basis - SCN was issued proposing duty demand with interest u/sd 75 and penalties u/s 77 & 78 of the Act - On adjudication, the demands were confirmed - The O-i-O was sustained by the Commr.(A).
Held: The nature of service rendered by the foreign agent is that of promotion and marketing of the assessee's goods which apparently fall under BAS - As per Section 66A, the assessee is liable to pay tax under RCM, having received service - Also if the assessee paid service tax, it could have availed credit of the same - Being registered with the Service Tax Department, the assessee could have used credit for payment of service tax - Being a 100% EoU, if the assessee is unable to utilise credit, it could have sought refund of unused credit u/r 5 of CCR - The non-payment of service tax could be due to a reasonable error or misunderstanding without any motive to evade payment of taxes as they would gain nothing from such evasion - Hence the penalties imposed u/s 77 & 78 merit being set aside: CESTAT
- Assessee's appeal partly allowed: HYDERABAD CESTAT
CENTRAL EXCISE
Morde Foods Pvt Ltd Vs PR CCE
CX - The assessee-company manufactures Sugar and Sugar confectionery and chocolates and other food preparations, which w.e.f. 24.12.2008 were dutiable u/s 4A of the CEA 1944 - Admittedly, while the assessee did clear manufactured goods to industrial and institutional buyers, which are specifically excluded from purview of the Legal Metrology Act 2011, it was the Revenue's case that packages bearing the inscription of 'For industrial use/institutional use as raw material not for retail sale' were also being sold to ultimate consumers - It was also claimed that such packages were assessed u/s 4 and not under the applicable section 4A of the CEA, 1944 - Hence the Revenue raised demand for differential amount of duty along with interest u/s 11AB of the CEA 1944 apart from imposing penalty u/s 11AC of the CEA - The evidence relied upon for alleging diversion of goods claimed to have been intended for industrial or institutional use, included the statements of distributors of the assessee as well as its directors and employees.
Held: The authorities for enforcement of the Legal Metrology Act 2011 initiated no action against the assessee - The contents or their lack in the returns prescribed under the CER 2000 does not find any place in the SCN or in the O-i-O - Perusal of the O-i-O shows that submissions made by the assessee regarding limitation were cursorily disposed off by the adjudicating authority - Limitation is to be decided as per the facts of each case - The appellate authorities can only adjudge whether the facts have been properly appreciated and applied against established law - The adjudicating authority apparently did not apply mind on this essential aspect that has a direct bearing on the outcome of the process initiated by the SCN - In such circumstances, the O-i-O merits being set aside and the matter merits remand for passing a fresh order on this sole aspect: CESTAT
- Case remanded: MUMBAI CESTAT
Integral Coach Factory Vs CGST & CE
CX - The assessee manufactures Railway coaches - It claimed refund of excess duty paid on ACCW coaches manufactured by it and cleared for the the Ministry of Defence - While remitting Excise duty, the assessee valued the goods at 110% of the cost of production of ACCW coaches, like other coaches cleared for their own use - The Revenue opined that the refund claim was hit by unjust enrichment and so proceeded to reject the refund claimed - On adjudication, it was held that the refund claim was to be considered on merits and that the Excise duty was realised by the assessee from the MoD, the refund claim was hit by unjust enrichment and so proceeded to reject the same - Such findings were sustained by the Commr.(A) - Hence the present appeal.
Held: Considering the documents on record, it is seen that the assessee initially paid the Excise duty on the estimated cost which was determined to be more than the actual cost and so the duty element on the excess cost alone was claimed as refund - The Supply Order mandates that the tax, duties and levies would be borne by the MoD, which in fact were initially borne by the assessee and later recovered from the MoD - The assessee which is engaged in manufacturing rail coaches is owned and operated by the Indian Railways and by virtue of this, qualifies as a Govt of India undertaking - In such case, the decision of the High Court in M/s Sescot Sheet Metal Works Ltd. Vs. CESTAT -2015-TIOL-1048-HC-MAD-CX, Chennai can be applied to underline the fact that no unjust enrichment can be attributed to the assessee - Hence the O-i-A in challenge merits being set aside: CESTAT
- Assessee's appeals allowed: CHENNAI CESTAT
CUSTOMS
Nayara Energy Ltd Vs CC
Cus - The issue at hand is whether the National Calamity Contingent Duty (NCCD) levied at specific rates is to be levied on actual Shore Tank Receipt Quantity or based on Ullage Report/Bill of Lading Quantity - The Revenue claimed that the NCCD be levied on the quantity as per the bill of lading and not on the actual shore tax receipt quantity - Hence duty demand was raised in respect of the differential quantity between bill of lading quantity and the actual shore tank receipt quantity - Hence the present appeal.
Held: The issue at hand was considered by the Tribunal in Bharat Petroleum Corporation Limited Vs CC. - 2015-TIOL-211-CESTAT-MUM., wherein it was held that the NCCD levied at specific rates has to be levied on actual Shore Tank Receipt Quantity - Such findings of the Tribunal were upheld by the Apex Court - In the present case, the rate of NCCD is specific and not ad valorem - Therefore the demand for differential NCCD based on bill of lading or Ullage report is unsustainable: CESTAT
- Assessee's appeal allowed: AHMEDABAD CESETAT
Hi Tech Sweet Water Technologies Pvt Ltd Vs CC
Cus - On the basis of intelligence that the assessee was importing goods declared as "Filmtech Membrane (water filter parts)" by classifying them under CTH 84212190 and by claiming the duty exemption under Sr No 8C(ii) of notfn 6/2006-CE, investigations were initiated against them - Two live consignments imported vide B/E dated 31.03.2011 for home consumption and another B/E dated 25.04.2011 were examined and found to operate on the "Reverse Osmosis Technology" as per the product catalogue of "Dow FILMTEC Membranes" of the manufacturer Dow Europe GmbH Switzerland - These consignments were allowed provisional clearance on execution of provisional duty bond - Investigations also revealed that in past assessee had also cleared the same goods by claiming full exemption from payment of CVD under Notfn 6/2006-CE, Sr No 8B - Assessee being a manufacturer and trader of water purification equipments and parts thereof was fully aware of the actual use of the said imported item since the same were being used by them in manufacture of their own products - It was also noticed that they were paying the duty without availing the benefit under notfn 6/2006-CE, in respect of the same imported goods from the same supplier in past - Thus the importer had misrepresented and suppressed the facts about actual nature and use of the said goods to avail undue benefit of CVD exemptions - Assessee admitted and paid the duty along with interest due in respect of each B/E - After completion of investigations, a SCN was issued to assessee - The issue on merits is no longer res integra and covered by decision in case of Pure & Cure Technology 2019-TIOL-38-CESTAT-MUM - Once the assessee have paid duty and interest and have admitted their liability, they are barred in subsequent proceedings to claim the benefit of limitation in respect of the amounts so paid - It is not the case of willful misstatement, suppression or mis-declaration, but a case of bonafide error in claiming the benefit of exemption which was not due to them, no merits found in the penal proceedings undertaken against them - Assessee had in the Bill of Entries, clearly described the imported goods - Since the assessee have clearly and correctly described the imported goods as part of water filter, the error in claiming the benefit of wrong exemption notification cannot be act of deliberate misdeclaration - Hence, no merits found in the order of Commissioner imposing penalty on assessee under Section 114A: CESTAT
- Appeal partly allowed: MUMBAI CESTAT | 
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