| SERVICE TAX
2020-TIOL-145-CESTAT-MUM
APM Terminals India Pvt Ltd Vs CST
ST - Vide impugned order, inter alia, demand of ST in respect of steamer agent service, manpower recruitment agency service, clearing and forwarding agent service rendered by the appellant were confirmed, penalties imposed- appeal to CESTAT.
Held: From the discussions and findings as recorded by the Commissioner, it is found that the entire discussions do not even refer to the service provider and service recipient, the contract between the two and any of the issues raised by the appellants in their defences/ submissions - the order is just quoting the provisions of the law and clarifications issued by the Board from time to time - it does not discuss in any way the applicability of the same to the present set of facts - the Bench is constrained to observe that the impugned order running into 31 pages is a non speaking order bereft of any reasoning, which is heart and soul of any order determining the rights of party -in view of the above, the appeal is allowed and the matter remanded back to the adjudicating authority to consider the submissions made by the Appellant and decide the issue by way of speaking order after analyzing the facts and law on the subject : CESTAT [para4.12, 5.1]
- Matter remanded: MUMBAI CESTAT
2020-TIOL-144-CESTAT-BANG
Mangalore Internet City Pvt Ltd Vs CCE & ST
ST - The assessee-company provides taxable services - It filed refund claim stating to have paid an amount of service tax with interest and penalty, following audit objections - However, the assessee later realised that there was no need to pay interest or penalty u/r 15 of CCR or u/s 78 of Finance Act, as they had sufficient balance of credit during the material period of alleged wrong availment of credit.
Held - It is seen that the payment of 15% penalty was voluntary and based on this voluntary payment, SCN was waived and there was no protest raised by the assessee while making the payment - Further, as per the Board clarification dated 18/08/2015, payment of penalty without issuance of SCN was in accordance with law - Further, the assessee had filed a declaration while seeking waiver of SCN that the amount paid will not be sought as refund - The Commr.(A) gave sufficient reason for denial of refund - Hence there is no infirmity in the O-i-A and the same is sustained: CESTAT
- Assessee's appeal dismissed: BANGALORE CESTAT
CENTRAL EXCISE
2020-TIOL-144-HC-KAR-CX
Ramesh Electricals Vs UoI
SVLDRS - The present petitions were filed seeking directions to the Revenue authorities to permit the petitioners to avail the benefit in the Arrears Category of the Sabka Vishwas Legacy Dispute Resolution Scheme.
Held - Considering the petition papers, some reprieve needs to be granted to the petitioners, considering that the SVLDRS is a statutory scheme providing relief to the assessees in various degrees depending upon the category into which they fit - However, going by the provisions of the Scheme r/w the Circular, the claim of the petitioners does not merit consideration under the Arrears Category inasmuch as, their arrears of tax are yet to be assessed and the adjudication is still pending - Nonetheless, there is force in the petitioner's claim that the SVLDRS is for the benefit of assessee & needs to be construed liberally to effectuate the purpose - Therefore, if the petitioners' claim cannot be considered under the Arrears Category, they should be permitted to avail the benefit under any other Category into which their case is fit - Besides, the petitioners' apprehension that their claim under Voluntary Disclosure Category is likely to be turned down because of some statutory block is taken care off by the statement of the Panel Counsel for the Revenue that the said apprehension is unwarranted & unfounded - Hence the Revenue authorities concerned are directed to consider the petitioners' claim for benefit under the SVLDRS subject to the latter making an appropriate application within time as prescribed by law: HC
- Writ petition partly allowed: KARNATAKA HIGH COURT
2020-TIOL-143-CESTAT-AHM
Cosmo Films Ltd Vs CCE & ST
CX - The assessee-company manufactures BOPP Film falling under Chapter sub-heading 39202020 of the CETA 1985 - Some amount of waste is generated in the manufacture process - Some quantity of such scrap is reprocessed which are either used to manufacture BOPP Films and such re-processed granules are exempted under Notfn No 67/95-CE - Some quantity of reprocessed granules are exempted as per Notfn No 06/2002-CE or Notfn No 04/2006 - Regarding the quantity of waste and scrap used, the assessee is not entitled for Notfn No 67/95-CE and is required to pay duty as part of the quantity of scrap also sold as such to the independent customers - The assessee adopted the assessable value which is same as that charged in case of sale of waste and scrap to independent customer - The Revenue claimed that in case of captive consumption of waste and scrap for manufacturing exempted reprocessed granules, the valuation should have been done on Cost Construction Method as per CAS-4 standard prepared by the ICAI - Accordingly, demand for differential amount of duty was raised and was confirmed by the adjudicating authority - Hence the present appeal.
Held - The issue at hand is that what should be the valuation of waste and scrap used captively for manufacture of reprocessed granules - The issue also involves whether the valuation should be done in terms of Rule 8 of the Central Excise Valuation Rules, i.e., on Cost Construction Method or on the comparable value of waste and scrap sold to independent customer on principal to principal basis - From the facts, it is clear that the waste and scrap captively consumed and sold to independent buyers is one and the same - There is no allegation that the two are different - It is seen that no investigation was carried out to establish that the waste and scrap sold and captively consumed are different in nature - Such waste and scrap is generated in the course of manufacturing BOPP film - Hence there cannot be a different category of waste in one process of manufacture of BOPP film - The SCN was issued only on the basis of Rule 8 of the Valuation Rules and CBEC Circular dated 30.06.2000 - Such dispute was resolved by the Larger Bench of the Apex Court in Ispat Industries Ltd v CCE according to which even though goods were not sold and used captively, the valuation of such goods shall be on the basis of the Sale Price of such goods sold to the independent buyers - Considering relevant portions of the O-i-O, it is seen that there is no specific character of the waste and scrap mentioned in the description, either in case of captive consumption or in case of waste and scrap sold to independent customer - Therefore, merely on the description which does not give the actual character of the scrap, it cannot be said that the scrap sold to independent customer is different from waste and scrap captively consumed - Hence the conclusion of the adjudicating authority that both types of clearances are of different waste and scrap is not tenable - Hence the duty demand is not sustainable on merits: CESTAT
Held - Limitation - The fact of sale of waste and scrap and captive consumption for further manufacture of re-processed granules and use thereof in the manufacture of BOPP films was within the knowledge of the Department as the assessee was otherwise discharging the duty and the issue is of question of law, as to what would be the valuation in case of captive consumption - Hence as the issue was contentious on the dispute of valuation in case of captive consumption of the same, it cannot be said that the assessee harbored any intention to evade payment of Excise duty - Hence extended period of limitation is not invokable as well and the demand raised is time barred: CESTAT
- Assessee's appeal allowed: AHMEDABAD CESTAT
CUSTOMS
2020-TIOL-145-HC-MAD-CUS
CC Vs Madras Petrochem Ltd
Cus - The issue at hand pertains to penalty and fine imposed on the assessee - Investigation by the Department revealed that the assessee had indulged in clandestine clearance of bonded goods - Duty had been paid before issuance of SCN - Penalty equivalent to the duty evaded had been imposed, since mens rea had been established - In respect of interest, the Tribunal held that the duty liability arose prior to 11.5.2001 - Hence interest u/s 28AB(1) could not be levied - It also held that redemption fine was not to be imposed in lieu of confiscation of any goods where the goods were not physically available for redemption - In respect of personal penalty imposed on the assessee-company's Managing Director, it was held that there was no finding to the effect that the Managing Director had personally indulged in any commission or omission which rendered the goods liable for confiscation u/s 111 of the Act - Hence the penalty u/s 112(a) was not unsustainable - The Revenue filed the present appeal in respect of the findings regarding the redemption fine.
Held - From the observations of the Tribunal, it has erred in holding that the decision of the Apex Court in Weston Components Ltd. vs. Commissioner of Customs, New Delhi is distinguishable - Such observation, handwritten by the Members of the Tribunal & bearing their initials, was made without giving any reasons and details - Such observation of the Tribunal is in conflict with the observations of the Tribunal in Weston Components - Hence such observations made by the Tribunal cannot be sustained and merit being set aside - However, such setting aside of the observation do not appear to be affecting the other points on which the relief was granted by the Tribunal in favour of the assesee - Hence the relevant portion in the Tribunal's order is deleted: HC
- Revenue's appeal allowed: MADRAS HIGH COURT
2020-TIOL-142-CESTAT-MUM
AGS Transact Technologies Ltd Vs CC
Cus - Whether liability of duty can be fastened on the appellant when appellant is a bona fide purchaser of DEPB scrips which was found later to be forged one.
Held: Said issue came up before the High Court of Punjab and Haryana in the case of Vallabh Design Products - 2007-TIOL-842-HC-P&H-CUS and wherein it has been held that the liability of duty cannot be fastened on the appellant being a bonafide purchaser of DEPB scrips - the said decision of the High Court of Punjab and Haryana has been affirmed by the Apex Court wherein the appeal filed by the Revenue has been dismissed - as the issue has already been settled, the impugned order is set aside and the appeal allowed : CESTAT [para 7, 8, 9]
- Appeal allowed: MUMBAI CESTAT
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