2021-TIOL-1748-HC-AP-CX

Bharathi Cement Corporation Pvt Ltd Vs Addl. CCT

CX - Petitioner was issued a demand notice dated 04.06.2019 for recovery of allegedly irregularly availed CENVAT credit of Rs.17,34,56,893/- - Petitioner filed a declaration SVLDRS-1 under the SVLDRS, 2019 and the Designated Committee issued a statement in form SVLDRS-3 indicating the amount payable by the declarant i.e. Rs.8,67,28,446.50 after extending the relief available under the scheme - Petitioner paid the said amount within 30 days but instead of issuing a discharge certificate as per sub-section (8) of section 127, the Commissioner of Central Tax issued the impugned letter dated 24.11.2020 refusing to issue a discharge certificate on the ground that the petitioner has illegally sought transitional credit of the disputed CENVAT credit under the CGST Act - It is this letter dated 24.11.2020 that has been challenged praying for a direction to the respondents to issue the discharge certificate in form SVLDRS-4 - Also in the meantime, the Commissioner proceeded with the adjudication of the SCN dated 04.06.2019 and passed the order-in-original dated 12.10.2020 which also came to be challenged by the petitioner - Incidentally, the Additional Commissioner has also issued a SCN dated 10.11.2020 with regard to the alleged irregular availment of transition credit of Rs.17,46,55,825/- u/s 140 of the CGST Act, 2017 and which includes the allegedly irregularly availed CENVAT credit of Rs.17,34,56,893/- on GTA and C&F Agency services, which apparently is the subject matter involved in the declaration made under the SVLDRS, 2019.

Held:  Once the declarant had made payment of the estimated amount as per the statement in the form of SVLDRS-3 within the stipulated time, it was beyond the jurisdiction of the respondents to proceed with adjudication of the show-cause notice issued under the Central Excise Act with regard to the self same subject matter and pass impugned order-in-original, dated 12.10.2020 - However, it is a matter of adjudication whether availing of Scheme would attach legitimacy to the CENVAT credit on GTA and C&F Agency services to the tune of Rs. 17,34,56,893/- and the same would be eligible for the purpose of transition under Section 140 of the GST Act - Thus, impugned show-cause notice, dated 10.11.2020, issued upon the petitioner with regard to availing of transitional credit under Section 140 of the GST Act in respect of the aforesaid CENVAT credit cannot be said to be without jurisdiction - Bench does not wish to interfere with the said show-cause notice and leaves it open to the adjudicating authority to take appropriate decision thereon - With regard to the issue of the 1st respondent - Designated Committee refusing to issue discharge certificate under Sub-section (8) of Section 127 of the Finance Act, Bench opines that there is nothing in the Scheme which empowers the said respondent to refuse issuance of the discharge certificate on the basis of any subsequent event apart from the fact of discovery of false statement relating to any material particular in the declaration - Availing of transitional credit by the petitioner under the GST Act on the CENVAT credit for GTA and C&F Agency services under the Central Excise Act is a subsequent and separate transaction from the declaration made by him under the Scheme and the adjudication of such claim cannot be said to be barred in law or without jurisdiction - Impugned order dated 12.10.2020 passed by the respondent Principal Commissioner in the matter of SCN dated 04.06.2019 is set aside - Letter, dated 24.11.2020, is, consequently, set aside and matter is remanded to the 1st respondent - Designated Committee is directed to consider the issuance of discharge certificate without prejudice to the adjudication under the aforesaid show-cause notice, dated 10.11.2020, issued under the GST Act: High Court  [para 11, 12]

- Petitions disposed of: ANDHRA PRADESH HIGH COURT

2021-TIOL-521-CESTAT-BANG

Dr Shalini Agasthi Vs CCT

ST - The appellant had purchased a Villa from RBD Shelters LLP and had paid service tax on the same - Thereafter, appellant realised that they have inadvertently paid the service tax and Department has treated the transaction as works contract whereas the transaction was for construction of a single residential house hence it was not liable to service tax and was exempted from the same vide Sl. No.14 of Notfn 25/2012-ST - The Original Authority rejected the refund claim on the ground that eligibility for a refund exists only when it involves construction of a single residential unit and not a residential unit as part of residential complex - There is a separate agreement entered between the appellant and the contractor for construction of individual house for which separate approval has been sanctioned - Case of appellant does not fall within the definition of ‘residential complex' - The ground for rejection is that there are common facilities like park and roads but in view of Relinquishment Deed produced on record, it is found that these common facilities like parks and roads have been relinquished to Government and hence the same is not the common properties of owner - It is rather a public property which cannot be considered as common facilities - The impugned order is not sustainable in law and therefore the same is set aside: CESTAT

- Appeal allowed: BANGALORE CESTAT

2021-TIOL-520-CESTAT-AHM

Virmati Software And Telecommunications Ltd Vs CCE & ST

ST - The demand of service tax involved is on three counts - As regard the demand of Rs. 31,51,929/-, appellant claimed that if overall agreement is read then it is clear that he is partner in joint venture and overall activity is on sharing basis therefore, he is not liable to pay service tax - Since the Commissioner has not considered the entire agreement and not discussed on each and every clause particularly the clauses pointed out by appellant, the conclusion arrived at is not proper and legal.

As regards the demand of Rs. 14,72,339/-, it is the submission of appellant that though they were liable to pay service tax but there was no joint venture arrangement for the period 01.12.2009 to 31.03.2011 - They have submitted that even in this case, the service tax was deducted by E.Mitra and the same was deposited by society - If it is so, after verification, if it is established that the payment was deducted from the amount paid to appellant and the same was deposited in Government exchequer, then prima facie service tax once again cannot be demanded from the appellant - In both demands, appellant also raised the issue of jurisdiction - It is appellant's submission that since they have raised the bills from Rajasthan and provided service in Rajasthan only, therefore the jurisdiction in that State apply and not Ahmedabad jurisdiction - This aspect also needs to be examined very carefully.

As regards the demand of Rs. 47,43,442/- which represent service tax on difference between the telephone recharge amount received from customers and amount out of the same paid to telecom companies - In this fact, it appears that difference amount is nothing but commission against sale of SIM Cards or recharge of SIM Cards - Difference amount between the sale of SIM card / recharge of SIM card and the amount remitted to the telephone company is nothing but only commission on which suffered service tax in the hands of principal - Entire matter needs reconsideration: CESTAT

- Matter remanded: AHMEDABAD CESTAT

2021-TIOL-519-CESTAT-MUM

Jindal Drugs Ltd Vs CCE

CX - Appeals are directed against Orders-in-Original - The situation in the case is where the issue has been decided in case of appellants themselves and after consideration of the issue, Tribunal allowed the opportunity to distinguish the earlier judgment of Tribunal and make submissions on merits - Issue is squarely covered by earlier decision in appellant's own case - Following the said judicial precedent, the impugned orders are set aside: CESTAT

- Appeals allowed: MUMBAI CESTAT

2021-TIOL-518-CESTAT-BANG

Kirloskar Toyota Textile Machinery Pvt Ltd Vs CCT

CX - Appellant has filed the refund claim of accumulated balance of unutilized credit of Education Cess and Secondary and Higher Education Cess available in their books under Section 11B of Central Excise Act within a period of one year from the introduction of GST law - With the introduction of GST, there is a restriction for these cesses to be transitioned into GST by virtue of Section 140(1) of the Act and therefore the appellant did not transfer the said credit of cesses into GST and preferred to file the refund claim under Section 11B of Central Excise Act - This issue was considered by Division Bench of Tribunal in the case of Bharat Heavy Electricals Ltd. 2020-TIOL-1341-CESTAT-DEL and after considering the decision of Apex Court as well as the High Court of Karnataka in case of Slovak India Trading Co. Pvt. Ltd. 2006-TIOL-469-HC-KAR-CX has held that the appellant is entitled to refund of an unutilized credit of Education Cess and Higher Education Cess after the introduction of GST - As far as time-bar aspect is concerned, the findings in impugned order regarding time-bar is beyond the SCN as well as O-I-O and the same is not sustainable in law: CESTAT

- Appeal allowed: BANGALORE CESTAT

2021-TIOL-517-CESTAT-CHD

Prime Steel Processors Vs CC

Cus - The appellant is in appeal against impugned order wherein a demand of duty has been confirmed and redemption fine and penalty were also imposed - The question which needs to be addressed is whether the hollow profiles and pipes weighing about 10 MT found in consignment were actually pipes and profiles and to be classified as such or merely as part of scrap - The only documents on the basis of which a decision can be made are examination reports and the letter given by appellant to the Customs authorities both of which confirm that they were indeed hollow profiles and pipes and not scrap as declared - The appellant accepted the mis-declaration, waived the SCN by asking for a spot adjudication - The argument of appellant is that although they accepted mis-declaration on their part and requested for spot adjudication, they never accepted the classification and valuation and a SCN should have been issued - Once the appellant gave in writing that they have mis-declared the goods, they should be classified as profiles and pipes only and duty should be charged accordingly, it is worth noting that the goods were examined and on the request of the appellant, re-examined and after both these reports confirmed that the goods were hollow profiles and pipes - If the pipes and profiles were indeed old, the appellant could have, instead of accepting a mis-declaration, requested for mutilation of these goods as per Section 24 so that they can no longer be used as pipes or profiles but need to be used as scrap only - However, the appellant made a request for spot adjudication accepting the mis-declaration and the order was passed accordingly - The appellant cannot now say that although they wanted a spot adjudication, the department should have still issued a SCN - Therefore, the demand of duty in adjudication order is upheld - However, considering the fact that the differential duty is only 1,35,823/-, redemption fine is reduced to Rs. 50,000/- and the penalty is reduced to Rs. 15,000/-: CESTAT

- Appeal partly allowed: CHANDIGARH CESTAT