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SERVICE TAX
2020-TIOL-1476-CESTAT-MAD
Stage 3 Ace Eventz Pvt Ltd Vs CST
ST - The issue relates to demand confirmed under Event Management Services - It is the case of department, that the assessee has not included the charges collected by them on the equipments/goods provided for the event - The assessee rendered services like organizing events of Rock shows, Corporate shows, Marriages and Promotions - They collected charges for conduct of events and also provided certain equipments/goods required to conduct the event - They entered into separate contract with customer for providing the goods needed for the event and collected charges in the nature of rent - These charges are nothing but expenses for rendering event management service and should form part of taxable value for paying service - This is because without the use of such equipments/goods, assessee would not be able to conduct the event - If assessee does not own/possess such goods they would have to take on hire such goods and then use for providing the service of event management - If that be so, the charges paid by assessee for hiring the goods/equipments would be nothing but expenses incurred for rendering event management service and such expenses would be includable in taxable value for paying service tax - They used their own equipments to conduct the event - Merely because the assessee bifurcated the contract as Event Management Service and for hiring of goods, it cannot be concluded that the charges paid for use of goods do not fall within Event management Services - The contracts are artificially bifurcated so as to exclude the charges incurred in use of goods for providing Event Management Services which is not permissible - The demand confirmed along with interest in impugned order does not require any interference - However, the penalty is set aside invoking Section 80 of the Act: CESTAT
- Appeal partly allowed: CHENNAI CESTAT
CENTRAL EXCISE
2020-TIOL-1475-CESTAT-MUM
Varroc Engineering Pvt Ltd Vs CCE & ST
CX - The assessee is engaged in manufacture of automobile parts - A SCN was issued to assessee alleging wrongful availment of Cenvat Credit on outdoor catering service - The period involved is from February 2014 to March 2015 and therefore, the amended definition of input service w.e.f. 01.04.2011 is applicable - The "Outdoor Catering service" being availed by assessee has a direct impact on the manufacturing process and the cost of final product manufactured by assessee - In the event, assessee does not avail the said service, employees in company would be compelled to step out of the factory premises for refreshments, which would lead to loss of manhours for assessee - This may prima facie seem menial, however, when considered at a larger scale, this translates into an additional cost for assessee - Therefore, by availing the said service, assessee attempts to ensure proper working conditions for its employees and reduce loss of manhours: CESTAT
- Appeal allowed: MUMBAI CESTAT
CUSTOMS
2020-TIOL-158-SC-CUS
Additional Director General Vs Its My Name Pvt Ltd
Cus - Gold Jewellery - Notification 18/2015-Cus - Advance Authorisation - ADG, DRI has assailed the CESTAT order dated 13 th November 2019 - 2019-TIOL-3519-CESTAT-DEL passed by the CESTAT granting provisional release of seized goods subject to fulfilment of stipulated conditions - appeal was admitted on the following substantial questions of law: (i)Whether the CESTAT can substitute its view for the discretion of the Adjudicating Authority U/S 110A.; (ii) Whether the appellate jurisdiction of the CESTAT against an order passed u/s 110A is restricted to examining whether such an order has been passed after duly considering the law in respect of provisional release and not pass arbitrarily. And (iii) Whether the appellant is entitled to provisional release of the seized gold in question in view of the facts and circumstances of this case - It was held that the power and jurisdiction of the Tribunal, hearing an appeal against an order of provisional release, is coequal with the power exercised by the adjudicating authority - It was also held that The exercise of power, to release imported goods on a provisional basis, under Section 110A of the Act is, essentially and fundamentally, discretionary in nature and that Statements, under Section 108 of the Act, though admissible in evidence, acquire relevance only when they are, in fact, admitted in evidence, by the adjudicating authority and, if the affected assessee so chooses, tested by cross-examination - It was also held that It is only in exceptional situations, where there is an apparent legislative lacuna, which, if left unfilled, would result in manifest injustice, or frustrate the object of the legislation, that a Court can step in and fill the lacuna and, to that limited extent, perform a quasi-legislative function. Else, the Court must rest content with being an interpreter of existing legislation, and has to accept the legislation for what it is - The High Court upheld the decision, of the Tribunal, to release, provisionally, and forthwith, the gold, gold jewellery and silver, seized from the warehouse premises of the respondent, as well as 25400.06 grams of gold jewellery, covered by Bill of Entry No. 107190 dated 17th April, 2019, on furnishing of a bond, by the respondent, covering the entire value of the said goods, along with a Bank Guarantee for Rs. 10 crores, containing an auto-renewal clause. However, the direction for release of 25299.68 grams of gold jewellery, the Bill of Entry in respect of which was unsigned by the respondent as well as by the Customs Import Clerk, unregistered and unaccompanied by any Job ID No., is quashed and set aside.
Held - The quantum of the bank guarantee directed to be furnished by the High Court warrants being enhanced from Rs 10 crores to Rs 15 crores - Hence the order of the High Court is modified to such end - The other conditions imposed by the High Court would continue to operate: SC -
Revenue's SLP disposed of : SUPREME COURT OF INDIA
2020-TIOL-1474-CESTAT-MUM
Uni Colloids Impex Pvt Ltd Vs CC
Cus - The appeals of M/s Uni Colloids Impex Pvt Ltd and of Mr. Abbas Haveliwala, require Tribunal to determine the legality of import of 'sweet whey powder' against 10 bills of entry, claiming exemption under notfn 40/2006-Cus or no. 98/2009-Cus under two DFIA ' licenses permitting import of 'leavening agent' that was originally issued to M/s Ravi Foods Pvt Ltd for the manufacture of 'biscuits' intended for export - With the threshold eligibility thus settled, the allegation pertaining to ineligibility arising from import by an entity other than 'actual user' and of ineligibility arising from utilization of a different 'leavening agent' in the exports effected by original license holder remain to be evaluated - The DFIA procured by appellant-importer had been made transferable in accordance with the provisions of Foreign Trade Policy and there is no whiff of allegation that the said endorsements had been procured unlawfully - The prescription of 'actual user' condition in Foreign Trade Policy and reflected in corresponding notification issued under section 25 of Customs Act, 1962, cannot be said to be extended to transferees of such licences, except where specified otherwise, either in the policy prescriptions or in the notification, for that would be tantamount to imposing a condition that was not intended by Central Government - Neither the adjudicating authority nor revenue have been able to establish that 'post-export, endorsed for transfer' license continued to be entailed with such actual user condition - In any case, the ultimate usage of such goods by an actual user which is not in contention here renders the logic of Revenue to be unacceptable - There is no evidence on record that the appellants were aware of the composition of exported goods - Hence, the appellant cannot be expected to conform to such imports as they are not cognizant of - From the available records and submissions made, Tribunal is unable to conclude if any of the inputs permitted for import to enable manufacture of biscuits are enumerated among the goods specified for conformity in Handbook of Procedures - In the light of findings on inadequacy of credible evidence, nature of impugned goods and apparent conformity with the conditions of Foreign Trade Policy, the impugned order cannot be sustained: CESTAT
- Appeals allowed: MUMBAI CESTAT
2020-TIOL-1473-CESTAT-DEL
Vishesh Cargo Services Vs CC
Cus - The assessee- CHA is in appeal against impugned order whereby the penalty imposed is confirmed under Section 114 and 114AA of Customs Act, 1962 - There are two middleman between exporter M/s Ayaan International and assessee, namely Shri Rohit Sharma a forwarder and Shri Rakesh Sagar - The allegation against assessee of their having received Rs. 1 lakh per consignment is not substantiated, over and above the usual charges - Shri Rakesh Sagar have stated that he was to receive Rs. 4,000/- on bill and remaining amount of Rs. 1 lakh in cash, is not the representative of CHA firm, and is an outsider - Thus, receipt of Rs. 1 lakh by Shri Rohit Sharma or Shri Rakesh Sagar is not the amount received by assessee - The Prop. of exporter firm and its Authorised Signatory have nowhere stated that they have paid any amount over and above usual charges to the assessee - Further, there is no allegation of any flow back of ill gotton draw back money to assessee - It has nowhere come on record that CHA was present at the time of packing and stuffing of container for shipping - There is also no allegation that CHA has cooked or concocted any document for presenting it to the Customs, knowing it to be false - Assessee have not done any act of commission or commission leading to violation of any of the provisions mentioned in Section 113 of the Customs Act, thus penalty under section 114 is set aside - The assessee have given cogent explanation as regards the undervaluation, that the samples shown to them were of good quality and hence on such reasonable belief they have undertaken the clearance work - No case is made out that the assessee knowingly filed the shipping bills that the goods are overvalued - Accordingly, penalty under Section 114AA is also not imposable: CESTAT
- Appeal allowed: DELHI CESTAT |
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