SERVICE TAX

2020-TIOL-273-CESTAT-ALL

Assotech Ltd Vs CCE & ST

ST - The assessee-company is engaged in providing Commercial or Industrial Construction Service, Construction of Residential Complex service, Works Contract Service & Site Formation Service to various clients - During the relevant period, the assessee received a contract from one M/s Arrow Infra Ltd for supplying mud and spreading and dumping of earth on agricultural land - As such activity was not covered under the scope of Site formation and clearance service, excavation, earth moving and demolition service no service tax was paid on the same - Such position was accepted by the Revenue - Subsequent to the completion of the work, M/s Arrow Infra Ltd got the land use changed from agricultural use to construction of residential complex - Thereafter, construction activity was commenced & buildings were constructed - The Revenue opined that since the land was now used for construction activity rather than for agricultural purposes, the services provided by the assessee during the period prior to the conversion of land usage, would be taxable under Site formation and clearance service and excavation, earth moving and demolition services - Hence duty demand was raised and the same was confirmed upon adjudication - Hence the present appeal.

Held: The definition of site formation and clearance excludes any activity done in relation to agriculture - Inasmuch as the services in the present case were provided in relation to agriculture, the same has to be held as exempted - Subsequent action by the owner of the land has got no relation to the activities done by the appellant prior to the said conversion - The court does not agree with the findings of the adjudicating authority that since the agricultural land was subsequently converted into commercial land, the activity undertaken by the assessee prior to the conversion would become taxable subsequent to conversion of the land - The taxability of the service is required to be examined at the time when the same were provided - Admittedly, such service was provided in respect of agricultural land - Hence there are no grounds to uphold the O-i-O: CESTAT

Held: Limitation - The assessee's counsel correctly claims that the demand is barred by limitation - At the time when the assessee provided the services, the same were exempted and so the assessee's plea of no service tax being payable cannot be doubted - There is no evidence on record to establish that the appellant at the time of providing the services knew that the said land is going to be converted - Hence, invoking extended limitation is not sustainable: CESTAT

- Assessee's appeal allowed: ALLAHABAD CESTAT

2020-TIOL-272-CESTAT-KOL

Aryavarta Dhatu Udyog Vs CGST & CE

ST - A Show Cause Notice was issued alleging that the assessee failed to pay Service Tax under the category of "Transport of Goods by Road Service" for the relevent period - The assessee failed to get registration with the Service Tax Department and has also failed to submit periodical ST-3 returns - Duty demand was proposed along with interest - Such demands were confirmed upon adjudication & thereafter, the Commr.(A) upheld such findings - The CA appeared on behalf of the assessee-Taxable Service category of "Transport of Goods by road", being a service recipient under the Reverse Charge Mechanism - and are liable to pay Service tax on each and every consignment not over the freight amount of Rs.750/-the appellant that they had paid Service Tax after availing the abatement of 75% on the Gross Amount -further contended that it has been made clear by the Ministry of Finance that incidence of tax in case of goods transport agency is on the transport booking agency and not on the truck owner-the DR justified the impugned orders-Hence appeal peresent before the tribunal.

Held: The assessee does not dispute liability to pay service tax & in fact, paid the same based on its calculation - Since the assessee is a service recipient and paid service tax under the reverse charge mechanism, it is entitled to abatement of 75% under Notfn No 32/2004-ST as amended by Notfn No 01/2006-ST - Besides, the judgment in K.M.B Granities Pvt. Ltd. V. CCE Salem is squarely applicable to the matter at hand - Further, it is also seen that the present case involves circumstances fit for invoking provisions of Section 80 of the Finance Act 1994 - Accordingly, penalties imposed u/s 77 & 78 are quashed - The matter is remanded to the adjudicating authority to quantify the service tax liability after considering that some payments were made to new truck owners who did not issue consignment notes - There is no service tax liability in such cases: CESTAT

- Assessee's appeal partly allowed: KOLKATA CESTAT

CENTRAL EXCISE

2020-TIOL-271-CESTAT-DEL

Mangal Electric Industries Pvt Ltd Vs CCE & CGST

CX - The issue at hand in the present appeal is as to whether the interest is payable on differential payment of duty arising on account of price variation.

Held: The issue at hand is squarely covered by the decision of the Supreme Court in Steel Authority of India vs. CCE, Raipur - It was held therein that while the principle that the value of the goods at the time of removal is to reign supreme, in a case where the price is provisional and subject to variation and when it is varied retrospectively it will be the price even at the time of removal - The fact that it is known, later cannot detract from the fact, that the later discovered price would not be value at the time of removal - It was also held that Sections 11A & 11AB as they stood at the relevant time did not provide read with the rules any other point of time when the amount of duty could be said to be payable and so equally the interest - Considering that the Apex Court decided the controversy involved in favour of the Revenue and against the assessee, the present appeal is dismissed on merits and also for want of prosecution, considering that the assessee is absent on date of hearing: CESTAT

- Assessee's appeal dismissed: DELHI CESTAT