| SERVICE TAX 2020-TIOL-75-CESTAT-HYD
Shriram Chits Pvt Ltd Vs CCE & ST
ST - The assessee-company entered into agreement with M/s Shriram Financial Services Holding Pvt Ltd (SFSH) with title of agreement being 'Agreement for providing access to branch network' with period of ten years - The assessee received an amount with the prelude that the assessee agreed to grant M/s SFSH or its nominees the right to access to its entire branch network and agency force - Second agreement was for payment of another amount and for the same reason - SCN was issued to the assessee on grounds that the consideration received was taxable under BSS and that the assessee had provided operational assistance for marketing to M/s SFSH or its nominees for keeping intact the entire branch network and agency force ready to use whenever requested - It was also alleged that the assessee contravened provisions of Section 68 of Finance Act r/w Rule 6 of STR 1994 and Section 70 r/w Rule 7 by not reflecting the consideration received towards value of taxable services in ST-3 returns - Duty demand was raised with interest & penalties and was confirmed upon adjudication - Hence this appeal.
Held - Limitation - The documents relied upon for issuing SCN are balance sheet, P&L a/c & ST-3 returns, which are statutory documents which have to be preapred and filed before the authorities in the time frame prescribed in the respective Acts - The network access fee has been picked up from these statutory documents and hence there cannot be any scope to allege suppression of the same - The BSS introduced w.e.f. 01.07.2012 covers only specific activities in the inclusive part of its definition and only those specific activities, if carried out, would get covered under Business Support Services - Admittedly, the assessee is nowhere alleged to have provided any of those services which are specified therein, but rather was only asked to 'keep intact …' for access whenever required - The exclusive definition of Business Support Service clearly does not cover this service: CESTAT
Held - Limitation - The SCN alleged wilful and intentional suppression of facts - It is trite law that the suppression can never be said to exist when material and relevant facts forming the basis for raising demand were already within knowledge of the Revenue - Hence the pre-conditions for application of proviso to Section 73(1) are not satisfied - Hence extended limitation cannot be invoked and the demand is to be confined within normal limitation period -
Clearly, the Show Cause Notice is issued alleging wilful and intentional suppression of facts by the appellant. It is trite in law that the suppression (intentional and deliberate) can never be said to exist when material and relevant facts forming the basis of the demand were already within the knowledge of the Revenue. Accordingly, the pre-conditions for applicability of the proviso to Section 73 (1) ibid. cannot be said to be met. In such eventuality, the extended period of limitation cannot be invoked and the demand to be confined to the normal period of one year - Hence the demand merits being quashed: CESTAT
- Assessee's appeal allowed: HYDERABAD CESTAT
CENTRAL EXCISE
2020-TIOL-66-HC-AHM-CX
CCE Vs Larsen and Toubro Ltd
CX - The present appeal does not merit considerartion since the tax value involved for filing appeal before the High Court is below the monetary limit of Rs 1 crores: HC
- Revenue's appeal dismissed: GUJARAT HIGH COURT
2020-TIOL-74-CESTAT-MUM
Ravin Cables Ltd Vs CCE
CX - During the relevant period i.e. from 31st January 2007 to 26th August 2008, the appellant had manufactured and cleared insulated wires and cables to SEZ Developers without payment of duty - alleging that such clearances are hit by rule 6 of the Cenvat Credit Rules, 2004, being exempted goods, accordingly, the appellant were required to reverse 10% of the value of such clearances - SCN issued for recovery of Rs.69.69 lakhs - demand confirmed with interest, penalty imposed, hence appeal to CESTAT.
Held: Tribunal in the case of Sujana Metal Products Ltd. [ 2011-TIOL-1173-CESTAT-BANG ] considered the issue at length and allowed the appeals of the assessee therein - this judgment has been upheld by the Andhra Pradesh High Court subsequently - 2013-TIOL-1128-HC-AP-ST - also, consistently, the principle laid down has been followed by the Tribunal - besides, the Karnataka High Court in the case of Lotus Power Gears (P) Ltd. - 2016-TIOL-1410-HC-KAR-CX also expressed a similar opinion - in the result, the impugned order is set aside and the appeal is allowed : CESTAT [para 5, 6]
- Appeal allowed: MUMBAI CESTAT
CUSTOMS
2020-TIOL-68-HC-MAD-CUS
CC Vs Medreich Sterilab Ltd
Cus - Notification 21/2003-Cus - Revenue is in appeal against the order of CESTAT holding that Rules 3 and 4 of the Customs (Import of Goods at Concessional Rate of Duty for Manufacture of Excisable Goods) Rules, 1996 were only procedural in nature and therefore, though the Application for registration under Rule 3 was filed later on and the Registration granted to the Respondent/Assessee to avail the exemption from payment of duty in respect of import under Bill of Entry dated 28.6.2003 under which goods imported in question which were cleared by the Customs Authority on 30.6.2003, prior to the date of Registration under Rule 3 on 14.7.2003, the Tribunal upheld the order of the lower appellate authority and thereby granted the exemption claimed by the Assessee.
Held: Bench is of the opinion that the Tribunal has erred in holding that the Rules are merely procedural or directory in nature and upholding the grant of exemption to the Assessee in respect of Bill of Entry dated 28.6.2003 by which the goods were imported and cleared on 30th June 2003 - The Certificate issued by the Superintendent of Central Excise, relied upon by the learned counsel for the Assessee is not under the aforesaid 1996 Rules but it is only a Certificate that the Assessee has not availed the Cenvat Credit on that consignment and that Certificate has nothing to do with the 1996 Rules in question - Very purpose of Rules and requirement of the Assessee to apply under Rule 4 for the intended imports in future would be frustrated, if these Rules were to be applied retrospectively to the imports already made: High Court [para 8]
Cus - Interpretation of Notification - It is well settled law that to avail the exemption of duty under any Notification, the Rules and Regulations and the conditions prescribed therein have to be strictly adhered and there is no place for equity or intendment in the interpretation of the taxing Statutes - By holding that the Rules of 1996 are only procedural or directory in nature, the Tribunal has frustrated the very purpose of Rules 3 and 4 in question by holding that the Assessee is entitled to the exemption for import made on 28.6.2003 - There is no dispute that the registration under Rules 1996 was granted in favour of the Assessee only on 14.7.2003 and not at any point of time prior to that and, therefore, Bench cannot uphold the order passed by the Tribunal: High Court [para 9]
Cus - Maintainability of Writ Petition - Assessee has raised a question with regard to maintainability of the present Appeal filed by the Revenue under section 130 of the Act on the ground of issues of rate or valuation were involved and that Appeal in such cases would lie only before the Supreme Court.
Held: The controversy in the present case is not with regard to the valuation of the goods in question or rate of duty, but, the question is of the wrong exemption claimed by the Assessee and granted by the Tribunal - Therefore, Bench is satisfied that the Appeal is maintainable before the High Court and the objection of the Assessee is overruled - Appeal filed by the Revenue is, therefore, allowed and the order passed by the Tribunal is set aside: High Court [para 10 to 12]
- Appeal allowed: MADRAS HIGH COURT
2020-TIOL-67-HC-MAD-CUS
M M Enterprises Vs CC
Cus - Petitioner had imported consignments of metal scrap - The petitioner sold them at a price lower than the value declared at the time of import and then claimed refund of the aforesaid duty paid in terms of the notification 102/2007-Cus - Certain flaws were noted by the respondents in the refund claims and therefore the refund claims were rejected – Commissioner(A) partly allowed the appeal by partly allowing the refund claims and partly disallowing the same – in appeal, CESTAT allowed the appeal of the petitioner following the decision of the larger bench of the tribunal in Chowgule & Co Private Limited - 2014-TIOL-1191-CESTAT-MUM-LB – Consequently, Petitioner sent a representation to the respondent for interest for delayed payment of refund under Section 27 A of the Customs Act, 1962 - impugned orders were passed rejecting the claim of the petitioner for interest on delayed payment of the SAD – grounds given for rejection were that the request of the petitioner cannot be entertained as order passed by this court in M/s. KSJ Metal Impex (I) Private Limited though referred to in RISO India Private Limited - 2015-TIOL-2384-HC-DEL-CUS has been stayed by a Division Bench of this court and, therefore, the decision of the Delhi High Court was not acceptable and sustainable – Petitioner has prayed for interest on delayed payment of Special Additional Duty refundable under Notification No. 102 of 2007-Cust dated 14.9.2007.
Held: The reasoning in the impugned order is contrary to the scheme of the Customs Act, 1962 - The exemption notification issued under Section 25A merely relaxes the condition from levy of tax - Refund of Duty is stipulated therein subject to the conditions - Procedure for refund of Duty is governed by Section 27 and the payment of interest on delayed payment thereon under Section 27A of the Customs Act - The notification cannot be read in isolation of the Customs Act, 1962 - If there is delay in payment of any refund claim, the 2nd respondent is duty bound to pay the interest in terms of Section 27A of the Customs Act - At the same time, since the decision of this Court rendered in KSJ Metals Impex (P) Ltd (cited supra) has been stayed, Bench is unable to give any relief to the petitioner at this stage - However, there is no difficulty in setting aside the impugned order and remitting the case back to the 2nd respondent to await for the decision of this Court in KSJ Metals Impex (P) Ltd (cited supra) before passing fresh order – Petition disposed of: High Court [para 14, 15, 18]
- Petition disposed of: MADRAS HIGH COURT
2020-TIOL-73-CESTAT-HYD
Pathange and Company Vs CC
Cus - The short point to be decided is, whether the consignment of Multi Functional Digital copiers imported prior to 05.06.2012 when the restriction was imposed upon them are liable to confiscation under section 111(d) for violation of FTP - Prior to this date, restrictions were imposed only on photocopiers and not on Multi Functional Digital Copiers explicitly - The issue is no longer res-integra and the three Member Bench in case of Asian Copiers 2015-TIOL-585-CESTAT-DEL has, by a majority decision, decided that import of Multi Functional Digital Copiers prior to 05.06.2012 was not restricted - The import of impugned goods is not restricted and their confiscation under section 111(d) is not sustainable - A plain reading of the O-I-O shows that confiscation was held under section 111(d) of Customs Act, 1962 which pertains to import in violation of restrictions and prohibitions and not under section 111(m) which deals with confiscation for under valuation - Therefore, the confiscation under section 111(d) of the Customs Act 1962 needs to be set aside - Consequently, the redemption fine imposed under section 125 on assessee also needs to be set aside - The penalty imposed under section 112(a) is consequent to the goods being held liable for confiscation under section 111 - As it is found that the goods are not liable for confiscation under section 111(d), the penalty imposed under section 112(a) also needs to be set aside: CESTAT
- Appeal allowed: HYDERABAD CESTAT | 
