2020-TIOL-392-HC-MAD-CX

Premier Cotton Textiles Vs CCGST

CX - Without showing cause before the Authority concerned himself and directly approaching the Writ Court invoking extraordinary jurisdiction under Article 226 of the Constitution of India is nothing, but an abuse of process of law - Constitutional Courts, in the absence of proper factual foundation and findings, should not be flooded with premature Writ Petitions and such practice on the part of the Assessees deserves to be strongly put down with the iron hands of justice - Single Judge was perfectly justified in relegating the Petitioner/ Assessee before the Authority concerned, who issued the impugned show cause notices where the Assessee had to avail the opportunity to show cause before the Authority concerned that the refund in question was not erroneously made earlier so as to justify a recall or refund back to the Department under Section 11A of the Act - Writ appeals dismissed: High Court [para 25, 26, 28]

- Appeals dismissed: MADRAS HIGH COURT

2020-TIOL-305-CESTAT-DEL

Shriram Rayons Vs CCGST & CE

CX - The assessee-company manufactures Rayon Tyre Yarn, Nylon Tyre Yarn and Rayon Tyre Cord Fabric - During the manufacture process, certain sludge/waste arises, which in terms of Rajasthan State Pollution Control Board, requires instructions to be cleared from the factory to the land fill area from the factory - The assessee entered into an agreement for clearance of the same - The service provider lifted the sludge from the premises, dumped the same in the land fill & issued invoices - While issuing invoices, the service provider bifurcated the charges but paid service tax on the full amount of the invoice - The assessee availed Cenvat credit of the service tax paid - The adjudicating authority disallowed the credit on transportation charges and toll charges on grounds that the transportation service was availed by the assessee beyond the place of removal - Such findings in the O-i-O were sustained by the Commr.(A) - Hence the present appeal.

Held - In terms of Rule 2(l) of the CCR 2004, Cenvat credit is disallowed for finished goods to be cleared to the place of buyer beyond the place of removal - In the present case, there is no buyer of this sludge cleared by the assessee - Moreover, the same is required to be dumped in terms of the Rajasthan State Pollution Control Board's direction to run their factory - Therefore, the assessee is mandatorily required to clear the sludge from their factory and for clearance of the same, the assessee availed transportation services which are like transportation charges paid for procurement of inputs by the assessee for manufacture of their final product - Hence the assessee is eligible to avail cenvat credit on the subject services: CESTAT

- Assessee's appeal allowed: DELHI CESTAT

2020-TIOL-304-CESTAT-ALL

Saraya Sugar Mills Vs CCGST & CE

CX - The assessee is engaged in manufacturing Sugar - Its factory was visited by Central Excise officers, who conducted various checks and verifications - Shortage of some 6084 bags of Sugar was observed and panchama was recorded - The shortage was admitted by the assessee who also agreed to pay the duty - The duty was deposited with interest, by adjusting the same against refund available to the assessee - Thereafter, SCN was issued proposing to raise duty demand and impose penalty - The same was sustained on adjudication, along with demands being raised for interest and imposition of identical amount of penalty - Such O-i-O was sustained by the Commr.(A) - Hence the present appeal.

Held - Apart from shortages, there is no evidence of clandestine removal of goods - Such charges of clandestine removal must be established through sufficient evidence - The discrepancies in the stock cannot be taken as a ground for upholding the allegations of clandestine removal - In the present case, there is no admission of any clandestine removal by the assessee - Further, there is no evidence of transportation of the goods, receipt of the goods by the customers or receipt of the consideration by the assessee - In such a scenario, the confirmation of demand of duty cannot be upheld - Hence the O-i-A merits being quashed: CESTAT

- Appeal allowed: ALLAHABAD CESTAT

2020-TIOL-303-CESTAT-ALL

CCGST Vs Spark Electrodes Pvt Ltd

CX - The assessee-company is engaged in manufacturing galvanized black pipes falling under Chapter 73 of the Central Excise Tariff Act - Its factory was visited by Central Excise officers who conducted various checks and verifications, whereupon certain shortage of finished goods was observed - Discrepancies were also found in RG-1 register with the production slips - Duty demand was raised and penalty was imposed - Demand for interest was raised as well - On appeal, the Commr.(A) quashed the O-i-O on grounds that the difference in stock between RG-1 and notebook had occurred due to different methods adopted for calculation - Hence the Commr.(A) observed there to be no evidence of manufacture & removal of excisable goods.

Held - In the O-i-A, the Commr.(A) observed that charges of clandestine manufacture and removal of excisable goods is to be proved by tangible, direct, affirmative and incontrovertible evidences - It was also held that the demand was based on unsubstantiated allegations and so was unsustainable, in absence of any evidence to infer clandestine manufacture & removal - Hence as the demand itself was not tenable, the penalties were also found to be unsustainable - The Revenue was unable to controvert such findings of the Commr.(A) - Hence the subject O-i-A suffers from no infirmity: CESTAT

- Revenue's appeal dismissed: ALLAHABAD CESTAT

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