2020-TIOL-NEWS-045, Dated: Saturday, February 22, 2020

ST - Prayer made in the writ petition is inter alia seeking directions to the respondents to credit the 'Input Tax Credit', being the transitional credit, prescribed under Section 140 of the CGST, 2017, in the account of the petitioner under GST and to accept the TRAN-1s Return manually - It is the case of the petitioner that he had filed the TRAN-1s Return within time, but the same could not be processed and accepted due to technical error and due to the delay by respondents in resolving the technical issue.

Held: Counsel for the respondents have not been able to seriously dispute the fact that the present case is also covered by the aforesaid judgment of this Court in Adfert Technologies Pvt. Ltd dated 04.11.2019 [ 2019-TIOL-2519-HC-P&H-GST ] as also the interim order in Indusind Media Communications Ltd. 2018-TIOL-2881-HC-DEL-GST - present writ petition is, therefore, allowed in the same terms as "CWP-30949-2018 titled as Adfert Technologies Pvt. Ltd. vs. Union of India and others", decided on 04.11.2019 - 2019-TIOL-2519-HC-P&H-GST - However, in view of the fact that it is also not disputed that the date of filing of the manual returns has been extended upto 30.12.2019, the operative part of the directions shall be amended accordingly - It is further directed that the petitioners shall be permitted, in the alternative to claim or enter the unutilized credit in question in their GST- 3B forms to be filed for the month of January, 2020 either electronically or manually: High Court

ST - Appellant is an authorised dealer of Maruti Suzuki India Ltd. and engaged in the business of sale of motor vehicles and their servicing - In the FY 2012-13, they had collected a sum of Rs. 2,000/- from each individual customer during sale of new vehicle and credited the same to Ledger Account as administrative charges from where expenses like pre-delivery inspection, fuel for the new vehicle, pooja expenses, handling charges etc. were met - Department took a view that the said administrative charge is a part of the service component and service tax is payable on the same under Business Support services - SCN issued and the demand was confirmed by the original authority along with penalty/interest and this order was upheld by the Commissioner(A), hence appellant is aggrieved and has filed appeal before Tribunal.

++ These charges collected by the appellant were on account of pre-delivery expenses, fuel expenses, pooja expenses as well as handling charges - Being a Single Member Bench, no finding can be given on such activities of the appellant as to fall within the same definition of ‘Business Support Service' since the same would amount to classification of services which a Single Member Bench is not empowered under the statute to classify: CESTAT [para 3]

++ It is revealed from the records that the appellant had collected those charges on the sale invoices itself as part of price of vehicle sold and only in their books of account, it was wrongly shown as administrative charges (para 6 of O-I-O refers) - Further, the total value of the vehicle including the above sale expenditure is maintained by the appellant as per the catalogue price declared by the vehicle manufacturing company - This being the factual aspect and Service Tax collection being dependent on the invoice value of services rendered which is un-associated with a sale invoice on which GST/Sales Tax is levied, Service Tax cannot be demanded on the same value which has been absorbed in the sale price of the vehicle - Bench is of the considered view that the demand of Service Tax on such price solely on the basis of wrong reflection in the books of account (ledger) is not in conformity to the law and same is required to be set aside - appeal allowed: CESTAT [para 4, 5]

ST - The assessee-company is engaged in production of Coal from its various mines and it sells the same on payment of Sales Tax and VAT - As per the requirement of the customers, the assessee also provides activities of sizing or downsizing the mined coal into certain specific sizes - For providing such activities, the assessee received consideration in addition to base price in the name of sizing charges - The Revenue interpreted that such activities provided by the assessee should fall under the category of BAS - SCN was issued and demands were sustained on adjudication.

Held: There is no service involved in the facts of the matter, which is an activity before sale - The assessee offering the cut to size coal to its customer, is like offering coal in various forms and sizes - Hence cutting of coal to various sizes is not a service to the buyer, because the buyer is being charged on per tonnage basis, which includes the sizing charges - On such amount, the assessee already paid Excise duty, VAT and Clean Energy Cess - Hence the demands are not sustainable and merit being quashed: CESTAT

2020-TIOL-339-CESTAT-MUM

CCE Vs Mutual Industries Ltd

CX - Respondent had failed to include the cost of the mould in the manufacturing cost of the finished goods viz. articles of plastic, hence periodical show-cause notices were issued to them to recover the differential duty with interest - original authority confirmed the demand but the Commissioner(A) held that amortization cost of the moulds @ 0.66% be added to the value of the finished goods and remanded the matter to the adjudicating authority for re-calculation of duty - Revenue contends that the amortization cost should be @1.75% - being aggrieved by the order of Commissioner(A), appeal filed.

Held: Amortization percentage has been arrived at based on the Chartered Accountant's certificate and no contrary evidence has been placed by the Revenue to rebut the said finding of the Commissioner (Appeals) - Also, the amount involved in the present appeal if calculated taking the revised amortization cost of mould @ 1.75% would definitely be less than Rs.50.00 lakhs, hence covered by the Litigation Policy Circular dated 22.08.2019 - no merit in the appeal filed by the Revenue, hence the impugned order is upheld and Revenue's appeal is dismissed: CESTAT [para 6]

- Appeal dismissed: MUMBAI CESTAT

2020-TIOL-337-CESTAT-KOL

CCE Vs Gail India Ltd

CX - The assessee-company is engaged in production of LPG and Solvex-GL - It availed duty exemption under Notfn No 33/99 for the goods produced - As per the notification, the assessee filed refund claim by the 7th day of the subsequent month - During the relevant period, the assessee was served an SCN proposing to reject the duty exemption claimed by the assessee on the LPG - Such exemption was later allowed by the Commr.(A) - The Revenue contested the assessee's claim in respect of LPG and it did not get COD clearance in respect of LPG - The assessee claimed refund in respect of Solvex-GL for the relevant period - SCN was issued proposing to deny the same on grounds that Solvex-GL was not covered under Sr No 13(1) as it was not gas and did not appear to be covered under any of the other entries - Refund orders were issued, sanctioning the refund - The Revenue's appeals were dismissed by the Commr.(A) - Hence the present appeal.

Held - The Commr.(A) raised valid questions as to whether enquiry was conducted with the postal authorities and if so, what was the result thereof and what steps were taken to rectify the mistake committed by sending te order by ordinary post and whether options available u/s 37C(1)(b) & 37C(1)(c) had been followed - It is seen from the record that no sucn enquiry was conducted - Hence the assessee cannot be made a scapegoat and lawful benefit due to the assessee could not have been curtailed by way of a review order - Though the Commissioner may claim that the issue was not brought to his notice by way of proposing a review, it is difficult to comprehend how a huge refund of about Rs 25 Crores was not brought to the Commissioner's notice formally or informally - Hence there is no merit in the Revenue's contention that the review could not be completed within the time limit prescribed as the order was not received - Hence the review is undertaken much after the time stipulated for such exercise: CESTAT

Held: Perusal of the Schedule clarifies that exemption is available in respect of Gas-based intermediate products - It is evident that the schedule not only refers to certain products but also certain processes - The only inference is that the products generated in the processes mentioned are covered by the entry and are eligible for exemption - Considering the manufacture process, it is seen that Solvex GL is not produced during the production or manufacture of LPG - Hence the exemption cannot be restricted to products which are formed in the gaseous stage alone for the reason that the exemption refers to gas based intermediate products and gas exploration and production - The correct interpretation of gas-based products would include all products produced in the process of production of gas/LPG - The argument of the Revenue is farfetched for the reason that even LPG for which the exemption was extended by the department is also in the bottle and sold in the liquefied form - The Notification does not give any such interpretation - It is clear that the Entry 13 refers to certain products which are not gaseous in nature - The main heading 'gas based intermediate products' has to include all the products intermediate or finally produced or occurring or manufactured in the process of exploration and production of gas - The distinction being created by the Department between liquids and gases is unacceptable - Therefore an appropriate reading of the Notification would give an understanding that the main activity referred to therein is gas exploration and products which emerge as finally or intermediately in the process are eligible for exemption - Where the wordings of the notification are very clear, two interpretations of it are not available - Hence the benefit of exemption is available to the assessee: CESTAT

- Revenue's appeals dismissed: KOLKATA CESTAT

CUSTOMS

2020-TIOL-341-CESTAT-MUM

Tahoorunnisa Vs CC

Cus - Delay of 587 days in filing appeal before Commissioner(A) - Commissoner(A) noted that u/s 128 of the Customs Act, 1962, the appeal is required to be filed within 60 days from the date of communication of the order and a delay of 30 days is condonable by the Commissioner(A); that the statute prescribes a maximum limit of 90 days for filing appeal; that the Commissioner(A) does not have the power to condone the delay beyond 30 days in addition to the 60 days prescribed under the Act - accordingly the appeal was rejected by the Commissioner(A) and the appellant has filed an appeal before the CESTAT contending that the order was passed in a mechanical manner.

Held: Commissioner (Appeals) is vested with the power to condone the delay upto a maximum period of 30 days in addition to the statutory limit of 60 days for filing an appeal, therefore, the Commissioner (Appeals) was justified in rejecting the appeal as not maintainable - issue is already settled by Supreme Court in the case of Singh Enterprises Vs CCE Jamshedpur - 2007-TIOL-231-SC-CX - no reason to disturb the order of Commissioner(A), hence appeal is rejected: CESTAT [para 3, 4]

- Appeal rejected: MUMBAI CESTAT