2021-TIOL-78-CESTAT-DEL

GE Power India Ltd Vs CCE

ST - The appellant entered into an agreement with M/s Gautami for undertaking the design, engineering, construction, installation, testing and commissioning of a "combined cycle gas turbine facility" Gas Facility in Andhra Pradesh - The appellant further claims that in order to execute a portion of "civil work" of aforesaid agreement, it appointed M/s Nagarjuna Construction Company as a contractor - The said civil work was further sub-contracted to M/s Ganon Durkekrley and M/s R.R. Services - The appellant asserts that it paid service tax after availing abatement of 67% in terms of the Notification dated March 1, 2006 by utilizing the CENVAT credit availed by appellant on the input services procured for provision of output services, other than services relating to CICS for Gautami - Audit of records of appellant revealed that it had utilized CENVAT credit against payment of service tax on CICS even though benefit of abatement of 67% under the notification was admissible only when the service provider did not avail credit of input, input services or capital goods - Accordingly, a SCN was issued to the appellant - The relevant Article 2.1 of the agreement executed between the appellant and Gautami clearly demonstrates that the contract was composite in nature involving both supply of goods/materials and provisions of services to Gautami - Such composite contracts are taxable under category of "works contract" w.e.f June 1, 2007 - The period of dispute is from April 1, 2006 to October 31, 2007 - Thus, the appellant was not required to pay service tax for any period prior to June 1, 2007 - Even for the period post June 1, 2007, service tax could not be demanded under CICS, as the service was classifiable under "works contract" - The confirmation of demand under the impugned order cannot be sustained: CESTAT

- Appeal allowed: DELHI CESTAT

Black Diamond Explosives Pvt Ltd Vs CCE & ST

CX - The assessee is engaged in manufacture of explosives and allied products - During the period in dispute, assessee has cleared "Matrix Emulsion" from its manufacturing unit to its sister unit by valuing the said goods under Rule 8 of Central Excise Rules, 2000, i.e. cost plus 10% as per the CAS-4 Valuation Standard - SCN was issued to raise demand of differential duty on the ground that value for purpose of payment of duty on said goods should have been made under Rule 4 of Valuation Rules instead of Rule 8 - The assessee has submitted that both the goods in question are different and that demand raised in respect of goods i.e. Matrix Emulsion is an input which is further used in manufacture of final product Site Mixed Explosive - The duty demand has been raised on Matrix Emulsion (input) by considering the price at which output, Site Mixed Explosive, has been cleared from their Dhanbad unit, which is not permissible under Rule 4 of Valuation Rules - However, the Commissioner, while justifying the valuation adopted by him has clearly noted that both the goods which were cleared by assessee to their sister unit as well as those cleared to independent buyers are the same - The assessee has also submitted the license issued by concerned department under Explosives Act to justify their claim that goods in question i.e. Matrix Emulsion is not an explosive and they are not entitled to sell such goods to any third party and hence do not have any market - Matter is remanded back to the Commissioner who would examine the facts and pass a reasoned order - In so far as the invocation of extended period of limitation is concerned, the Department was at its liberty to examine the aspect of correct valuation in normal course and having not done, the demand of differential duty cannot be raised by invoking extended period of limitation - Thus, the demand pertaining to extended period of limitation is set aside - Penalty as imposed in impugned order is also set aside in entirety in absence of any element of fraud or suppression: CESTAT

- Matter remanded: KOLKATA CESTAT