2021-TIOL-772-HC-KAR-NDPS

Aayush Ajit Vs Inspector of Customs

NDPS - This successive bail petition is filed by the petitioner under Section 439 of Cr.P.C. for granting him bail for the offences punishable under Sections 8(C), 22(C), 23(C), 27, 28 and 29 of NDPS Act, 1985 on the complaint filed by Inspector of Customs - The case of the prosecution is that eight suspected parcels have been received by Foreign Post Office, Chamarajpet Post office in the name of petitioner, then the same was referred to the complainant, they verified it by sending the samples to the Forensic Science Lab and they found suspected parcels containing ‘MDMA' drugs, weighing 150 gms - Thereafter, a notice has been sent to the petitioner and later, after interrogation, he was taken into custody and he was produced before the Court - The petitioner has filed the petition before this Court in Crl.P.No.4017/2020, which came to be rejected on 08.10.2020 - This Court has considered the entire material on record and detailed orders are passed and dismissed the petition - Except the contention that the petitioner's father is unwell, there is no other additional ground addressed by the petitioner - As per the records, seized drug is 150 gms which is 15 times more than the commercial quantity and worth of Rs.15.00 lakhs - The alleged offence is a heinous one - If the petitioner is granted bail, there is every possibility of tampering the witnesses and absconding the case - Therefore, the petitioner has not made out any fresh ground for considering the bail petition: HC

- Petition dismissed: KARNATAKA HIGH COURT

2021-TIOL-771-HC-MAD-CX

CGST & CE Vs TVS Motor Company Ltd

CX - Respondent assessee entered into an agreement with M/s. TVS Finance and Services Limited (TVSFS) to provide finance facilities to customers, who purchase two wheelers manufactured by the assessee - During the period under consideration, TVSFS raised invoices on the respondent/assessee under the head "Business Auxiliary Services" including service tax at appropriate rates and the assessee availed credit of the service tax paid to TVSFS being input services provided to them - This credit was denied by the Revenue but in appeal, the CESTAT allowed the appeal by concluding that the activity rendered by TVSFS is an activity relating to the business of manufacture of the assessee and hence qualifies as 'input service' inasmuch as credit is admissible - Therefore, Revenue is aggrieved and before the High Court.

Held:

++ The facts clearly show that there is direct nexus between the activity of TVSFS with that of the activity of the assessee. The Revenue has not disputed the factual position that the services rendered by TVSFS is exclusively to the assessee. [para 22]

++ The expansive definition requires to be applied in this case and as noted, the Memorandum of Understanding provides for exclusive retail financing of two wheelers manufactured by the assessee, which results in promotion and expansion of sale of two wheelers manufactured by the assessee and payments are received by TVSFS from the assessee and as the services are taxable under Business Auxiliary Services, TVSFS has obtained registration under the Act, as provided under Rule 4 of the Service Tax Rules, 1994. Thus, as long as services of TVSFS in relation to financing of the vehicles manufactured by the assessee promotes the sale of vehicles manufactured by the assessee, such service is taxable under Business Auxiliary Services. [para 23]

++ Tribunal had rightly allowed the assessee's appeal and granted the relief. [para 24]

- Revenue Appeal dismissed: MADRAS HIGH COURT

2021-TIOL-770-HC-MAD-CUS

Jayasakthi Papers Vs CC

Cus - When the goods [coated paper - Heading 4810 13 90] were about to be cleared, the second respondent entertained a doubt that the imported goods are “stock lots” and seized them on 12.02.2021 - The petitioner submitted representation on 16.02.2021 seeking their clearance on the ground that the consignments cannot be considered as 'stock lots' - In the alternative, they prayed for provisional release but since his request was not acted upon, the present writ petitions came to be filed.

Held:

++ The only question that arises for consideration is whether the goods imported by the petitioner can be termed as a stock lot. This expression in normal parlance has a different meaning altogether. If there is clearance sale or distress sale, the transaction value will not reflect the contemporaneous market value of the goods. But in the case on hand, the expression bears a different connotation altogether. The Director General of Foreign Trade has ascribed a particular meaning to this term in their trade notice No.8/2020-2021. Like Humpty Dumpty in Lewis Carroll's 'Through the Looking Glass', when DGFT uses a word, it means just what it chooses it to mean-neither more nor less. [para 8]

++ The imported paper consignment will qualify to be a stock lot, if it is without description for each category of the paper or if papers of different descriptions have been bundled together. [para 9]

++ The eight digit code in this case is 4810 13 90 and it does not envisage any GSM variations. 4810 13 deals with goods in rolls, while 4810 14 deals with goods in sheets. If 4810 13 and 4810 14 are compared, it can be seen that while dimensions are mentioned for sheets, no dimensions are mentioned for rolls. Therefore, the question of applying the yardstick of GSM variation in the case of 4810 13 will not arise at all. [para 12]

++ In the case on hand, one consignment contains one sided coated paper rolls and the other consignment contains two sided coated paper rolls. The respondents have categorised the imported paper as falling under different heads only based on GSM dimensions. [para 13]

++ To reiterate, the key to the problem lies in the matter of classification. Classification is based on description of goods. If the imported goods can be demonstrated as falling under different codes and the importer has failed to describe each category of paper or if paper of different descriptions have been bundled together, then they would constitute a stock lot. In this case, the petitioner has classified the goods in question under eight digit ITC (HS) 4810 13 90. If the respondents are asked to classify the goods in question, they cannot come up with a different classification. Yet by introducing an impermissible yardstick namely, GSM variation, the respondents have arrived at a finding that the imported goods constitute a stock lot. This is patently illegal. [para 14]

++ Held that the seizure and detention of the petition-mentioned goods is not warranted. The respondents are directed to release them. Since the petitioner cannot be blamed for the detention of the goods, he will be entitled to corresponding waiver. The respondents have to issue the necessary certificates. [para 15]

++ Writ petitions allowed

- Petitions allowed: MADRAS HIGH COURT

2021-TIOL-180-CESTAT-CHD

Avon Cycle Ltd Vs CCE & ST

CX - The appellant is a manufacturer of bicycles, electrically operated vehicles and parts and accessories thereof - During audit, it was observed that the appellant has not filed returns, therefore, a SCN was issued proposing demand of late fees recoverable from appellant under provisions of Central Excise Law - The lower authority confirmed the proposals made in SCN - The sole ground taken by appellant that as in SCN, there is no allegation of wilful suppression, concealment of facts or misdeclaration, therefore, penalties on them are not imposable - During the course of audit itself, the audit team raised the objection, but the appellant did not accept the view of audit team and did not file the returns - In these circumstances, the extended period of limitation is rightly invoked - Further, penalty imposed under Rule 27 of CER, 2002 is on higher side and the same is reduced to Rs. 2000 for non filing ER-4 (Yearly) return for the period 2013-14 - For ER-4 (Yearly) return for the period 2014-15 and for ER-7 (Yearly) return for the period 2014-15, penalties in terms of Rule 12(6) of CER, 2002 have been rightly imposed for non filing the returns of Rs. 20,000/- each, the same are confirmed - For ER-5 (Yearly) return for the period 2014-15 and ER-6 (Monthly) for the period August 2014 to March 2016, penalties imposed in terms of Rule 15A of CER, 2002 for non filing the returns under Rule 9A(3) of CCR, 2004, at the time of issuance of SCN, the provisions of Rule 9A(3) were omitted without saving clause - Penalties of Rs. 5000/- and Rs. 95,000/- respectively imposed on the appellant are set aside: CESTAT

- Appeal partly allowed: CHANDIGARH CESTAT

2021-TIOL-179-CESTAT-MUM

Ajay Sharma Vs CC

Cus - The appellant had filed Bills of Entry for import of Opal Glassware and Plain Glassware declaring the value of goods - Alleging that the appellant had misdeclared the value, the value was enhanced by adjudicating authority and differential duty was confirmed with equal amount of penalty - On appeal, the Commissioner (Appeals) directed pre-deposit of 50% of duty confirmed in compliance with Section 129E of the Customs Act, 1962 - Since, they did not comply with the said direction, the Commissioner (Appeals) dismissed their appeal - During investigation, the appellant has already deposited Rs. 3,65,641/- against the total demand of Rs. 13,63,402/-, which is sufficient to hear the appeal - Since the Commissioner (Appeals) has not heard the matter on merit, matter is remanded to decide the issue on merit without insisting any further pre-deposit: CESTAT

- Matter remanded: MUMBAI CESTAT