| SERVICE TAX
2020-TIOL-766-CESTAT-MAD
Kumar's Electronics Vs CCE & ST
ST - First Appellate Authority has rejected the appeal as time-barred but without passing any order on merits - appeal filed before CESTAT by contending that the assessee-appellant had not at all received the o-in-o and only when the Revenue officials approached the appellant for the recovery of demand raised in the Order-in-Original did the appellant come to know of passing of the order; that the appellant had requested for the Order-in-Original, but were given only a photocopy which contained the despatch seal evidencing despatch on 11.11.2014; that the acknowledgement furnished by the Revenue contains the date of despatch as 15.11.2014 whereas the acknowledgement allegedly containing the recipient's signature contains the seal of the postal authorities for delivery as 13.11.2014 and which itself belies the claim of the Revenue that they had served the order on 11.11.2014 as mentioned in the impugned order.
Held: Revenue has not been able to prove the date of receipt which is vital for reckoning the period of limitation for filing the first appeal - The stand of the Revenue that the appellant has received the Order-in-Original, based on the endorsement of the postal authorities is creating more confusion - The date of despatch as per the above is 15.11.2014, but the date of receipt is 13.11.2014 - Bench has no choice but to go with the contentions of the assessee as regards receipt of the order is concerned - consequently, the first appeal filed by the assessee before the First Appellate Authority is within the prescribed period of limitation - appellant should not suffer for no fault on its part and hence, Bench deems it proper to set aside the impugned order with a direction to the First Appellate Authority to pass a fresh order on merits after hearing the appellant and following the principles of natural justice - Matter remanded: CESTAT [para 5 to 8]
- Matter remanded: CHENNAI CESTAT
2020-TIOL-765-CESTAT-ALL
Shree Parcel Services Vs CCE & ST
ST - The assessee was registered with Service Tax Department under category of 'Courier Agency Service' and were discharging their service tax liability - However, w.e.f. June, 2010, they by entertaining a view that the services being rendered by them are GTA service, as the goods are being transported to the destination through rails started paying duty under the category of GTA services - While paying duty on reverse charge basis they availed benefit of Notfn 26/2012-ST and the service tax was being paid after availing the abatement of 70% of value of the rail freight - There cannot be any mala fide or suppression and mis-statement on their part with an intention to evade payment of duty - As such, the demand raised and confirmed beyond normal period of limitation is hit by bar of limitation and cannot be upheld - Accordingly, Lower Authorities are directed to quantify the demand falling within the limitation period which will be paid by assessee along with interest - Penalty imposed upon them is set aside: CESTAT
- Appeal partly allowed: ALLAHABAD CESTAT
CENTRAL EXCISE
2020-TIOL-767-CESTAT-AHM
Kedar Metals Pvt Ltd Vs CCE & ST
CX - The demand was raised under Rule 6(3A) i.e. 5%/6%/7% of value of exempted services - It is the submission of assessee that during the period involved, no Cenvat credit of common input services was availed - However, the fact whether during the period 2013-14 to 2015-16, assessee has not availed Cenvat credit or otherwise, has neither been properly submitted by assessee nor the Adjudicating Authority or Commissioner (A) has verified - Therefore, the matter should go back to the Adjudicating Authority to verify whether the assessee has availed Cenvat credit on common input service during the relevant period - Moreover, the issue has already been decided by this Tribunal for the previous period in order dated 21.08.2018 - The Adjudicating Authority shall also consider the said judgment of this Tribunal while passing the de-novo order: CESTAT
- Matter remanded: AHMEDABAD CESTAT
2020-TIOL-764-CESTAT-KOL
Paras Pan Products Pvt Ltd Vs Commissioner of CGST & CE
CX - Documents relied upon by the Revenue nowhere mention the name of the Appellant in Challans being relied upon by the Revenue - It was also stated by the alleged suppliers in their statements before the department that they have not accounted for such supply in their books of accounts - Some of the papers placed from page No. 30 to 39 of Appeal Paper Book (Volume-II) appears to be the rough pages of some dairy for the period January, 2001 to July, 2001 - No specific date of supply can be found from such papers - It is also noteworthy that the statements of suppliers were recorded at the back of the Appellant and the cross examination of one of such supplier by the Commissioner remained incomplete - It is a settled law that in absence of corroborative evidence, 3rd Party evidence collected at the back of the Appellant, cannot be used against the manufacturer to prove clandestine removal, unless they are further supported by corroborative evidence - Show Cause Notice has not shown any unaccounted receipt or consumption of main raw materials i.e. Supari, Katha, Kimam, Perfume, Menthol or Tobacco which are main raw material for manufacture of "Pan Masala containing Tobacco" - The packing material would come into picture only once raw materials are consumed and finished goods are produced: CESTAT [para 23]
CX - Evidentiary value of statements - Admissibility of evidence without following the procedure established under Section 9(D) (i) of the Act, is not admissible as an evidence in the investigation proceedings - The persons giving the statements have not been examined, cross examined by the adjudicating Authority/Appellant - statement recorded during the investigation is required to be admissible as evidence only when the person is examined by the Adjudicating Authority as per the procedure prescribed as per Section 9D of the Central Excise Act and having not done so, the statements recorded from the various persons have no evidentiary value: CESTAT [para 24]
CX - Clandestine removal - It is also alleged that the Appellant has failed to file a declaration with the Central Excise Department in terms of Rule 6 of Pan Masala Packing Machines (Capacity Determination & Collection of Duty) Rules, 2008 mentioning therein the No. and description of packing machines and the goods which are intended to be manufactured with the aid of such packing machines - It is the case of the Appellant that they did not manufacture "Pan Masala containing Tobacco' during the relevant period and as such they were not required to file any declaration inasmuch as the said declaration was required to be filed by a manufacturer of the notified goods and not otherwise and that too in respect of machines intended to be used for manufacture of notified goods - Revenue has failed to establish manufacture and removal of notified goods in the factory of the Appellant during July, 2008 and August, 2008 - As such, no such declaration was required to be filed by the Appellant - There is also force in the contention of the Appellant that in the light of Sub-rule (2) of Rule 17 of Pan Masala Packing Machines (Capacity Determination & Collection of Duty) Rules, 2008, these rules were not applicable to the Appellant as they were admittedly not registered with the Central Excise during the relevant period - It is well settled that charge of clandestine removal is a serious charge and must be proved by adducing tangible, cogent and affirmative evidence which are completely lacking in the instant case - impugned order set aside and appeals allowed with consequential relief: CESTAT [para 25, 26, 29]
- KOLKATA CESTAT
CUSTOMS
2020-TIOL-959-HC-DEL-CUS
Polytech Trade Foundation Vs UoI
Cus - Petitioner is an association which comprises of persons/traders/companies/dealers who are in the business of importing plastic/polymer raw material from different countries through sea and supply it to manufacturers/companies engaged in the business of packing food, medicines, medical equipments etc. - Petitioner claims that the usage of PVC resin is intermediary to manufacture bottles containing sanitisers, masks and personal protective equipments (PPE), helmet, goggles, or other garments which are urgently needed to meet the requirements to contain COVID-19 - Petitioner states that due to lockdown since 22nd March 2020, several shipments/containers belonging to the importers/traders associated with the petitioner could not be lifted from respective ports due to non-availability of transport and labour - it is alleged that the respondent no.3 and its members i.e. respondents no. 4 and 6 are not permitting the traders/members of the petitioner foundation to lift their material from their respective ports without payment of penal charges - a direction is, therefore, sought to direct the respondents 1 and 2 to further direct respondents nos. 3 to 6 and all other CFSs not to charge demurrage, ground rent, container detention charges etc. till the lockdown is functional and to permit the members/traders to lift/de-stuff their material on payment of usual valid charges.
Held: Advisories are not mandatory or directory - Vide various advisories issued by Ministries, shipping lines and custodians of ICDs are advised to adopt a sympathetic and humanitarian approach while levying the container detention charges/ground rent charges on import cargo for the lockdown period - These Circulars are in the form of advisories and are not directory in nature and do not mandate respondent no. 3 to 6 not to charge ground rent, penal charges/demurrage etc. - Some of the advisories only contemplate that authorities concerned should adopt sympathetic and humanitarian approach and has advised them not to charge ground rent or penal charges - Circulars/guidelines/advisories issued by respondents no. 1 and 2 prima facie do not bind respondents no. 3 to 6 who are not availing any concession from port authorities and who have their containers located outside the port land - moreover, the letters/guidelines/advisories also cannot intervene or interfere in a private contract which respondent no. 3 to 6 have with their customers viz. petitioner - In these circumstances, there is no material on record which prima facie suggests that any right of the petitioner has been violated by the respondents - Court is further of the opinion that since respondents no. 3 to 6 are not bound by various guidelines/letters/advisories issued by respondent no. 1 and 2, the balance of convenience also does not lie in favour of the petitioner - Even no irreparable loss is going to be caused to the petitioner if injunction/restrained order is not granted for the reason that if this court finally comes to a conclusion that these letters were not in the form of advisories/guidelines but were in fact binding directions, the petitioner can recover the ground rent/penal charges paid by them to respondent no. 3 to 6 - No grounds for grant of injunction/restrain order in favour of petitioner and against the respondents are made out at this stage - application filed by petitioner under s.151 of the CPC for injunction is, therefore, dismissed: High Court [para 44, 45, 49, 51]
- Application dismissed: DELHI HIGH COURT
2020-TIOL-769-CESTAT-BANG
JK Cement Ltd Vs CC
Cus - Appellant has made excess payment of duty when the appellant was asked to deposit an amount of Rs.12,28,004/- and which was deposited in cash - Observation of the Commissioner(Appeals) in the impugned order that the appellant has claimed the refund by way of recredit in the licence is factually incorrect because in the application for refund, which is on record, it is nowhere mentioned that the appellant has claimed the refund by way of credit whereas the fact of the matter is that the appellant has filed the application seeking refund of the excess duty paid by them by debit in the license No.1510019864 which was left over while considering the amount of duty paid - Further, the Circular No 6/2008 dt. 28/04/2008 which was relied upon by the Commissioner(Appeals) to reject the refund in cash has been held ultra vires of the Customs Act in the case of Allen Diesels India Pvt. Ltd. - 2016-TIOL-968-HC-DEL-CUS - the whole situation has arisen due to the fact that licence was debited but the same was not reflecting in the system and as a result the appellant had to pay in cash - Subsequently, mistake was detected but the authorities did not correct the same on their own but the appellant was compelled to seek refund - It is a settled law that the Department cannot take advantage of its own wrong - impugned order is not sustainable in law and, therefore, is set aside and appeal is allowed with consequential relief: CESTAT [para 6, 7]
- Appeal allowed: BANGALORE CESTAT
2020-TIOL-768-CESTAT-DEL
Bharati Freight Forwarders Pvt Ltd Vs CCGST & CE
Cus - The assessee is a CHA/Customs Broker and the second assesse is its Director - They have undertaken clearing work of capital goods for M/s Kasare Vanya Silk Mill Pvt. Ltd. under EPCG Scheme - The capital goods imported by M/s Kasare Vanya Silk Mill Pvt. Ltd. were cleared at the zero rate as per the provision of Notfn 102/2009-Customs - The Adjudicating Authority has imposed penalty under Section 112 (B) (ii) on the assessee on two grounds; firstly, that they were required to keep an account of duty saved under EPCG licence and they could have stopped the misuse of EPCG authorization letter which led to over-utilization of EPCG value - Secondly, that they have abated the diversion of machinery imported under EPCG licence at zero rate of duty without fulfillment of export obligation - The Department has not adduced any concrete evidence to prove that the assessee have helped the importer in the diversion of duty free imported capital goods without fulfillment of export obligation - The role of customs clearing agent is limited to the clearance of import consignment from the port of importation and once the consignment has been handed over to the importer its beyond imagination that custom house agent can keep track of the import consignment as to whether it is being installed by the importer at his factory premises or being diverted/sold to some other person - Tribunal do not find an iota of evidence to establish any connivance or abatement on the part of assessee with the importer in diversion of duty free imported capital goods - With regard to charge of over-utilization of EPCG licence whereunder some consignment has been cleared without payment of customs duty, once EPCG licence is registered with particular port of importation the value of the EPCG licence is maintained by custom house and same is also endorsed on the licence itself - The CHA cannot be made responsible for ensuring that import value should be within the limit of the EPCG licence value - It is a normal practice at any port that an importer can appoint different CHA for clearance of import consignments and, therefore, it cannot be alleged that a particular CHA is responsible for over-utilization of EPCG value - CHA cannot be made responsible for such misuse of EPCG licence unless and until some concrete evidence is produced which establishes a malafide on the part of CHA and misuse of EPCG licence - No such evidence has been adduced by Department which clearly involves the assessee in misuse of EPCG licences - The charges levelled against assessee on the basis of which penalty under Section 112 (B) (ii) under Customs Act, 1962 has been imposed, are not proved by Department and therefore, the penalty imposed under impugned order is set aside: CESTAT
- Appeals allowed: DELHI CESTAT
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