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2021-TIOL-1895-HC-MAD-ST
Rocky Marketing Pvt Ltd Vs JCGST & CE
ST - Petitioner is praying for the issuance of Writ of Certiorarified Mandamus and quash the impugned show cause notice dt. 26.02.2021 issued by the respondent, on the ground that the same being an abuse of the process of law, lacks judicial propriety, illegal, contrary to Rule 6 of the CCR, 2004 and ultra vires Articles 19(1)(g) and Article 265 of the Constitution of India and for directing the respondent to sanction the refund, as per the orders of the CESTAT - Petitioner had availed CENVAT credit of an amount of Rs. 86,10,981/- in respect of the compensation paid to Amazon for fulfilment services - Since it was advised that it would not be entitled to credit in respect of the exempt services, the petitioner made good the liability in that regard - Later, upon receipt of legal advice, petitioner took the stand that the said services are 'input services' u/r 2(l) of CCR, 2004 - however, since the services are used in common, for both trading as well as exempt services, upon application of rule 6(3), the petitioner assessee found that they had overpaid the quantum of credit and thus claimed a refund of an amount of Rs. 47,38,050/- representing credit paid in excess, along with interest - such application was rejected and consequently an appeal came to be filed before Commissioner (Appeals) which came to be partly allowed on 28.11.2016 - Tribunal vide order dated 03.11.2020 held that the conclusion of the Commissioner (Appeals) that the reversal of credit should be as per rule 6(3)(i) is against the provisions of law; that the petitioner was entitled for reversal after computing proportionate credit by applying rule 6(3)(ii) - Accordingly, Tribunal directed the authority to quantify the amount for which purpose they remanded the matter to the adjudicating authority - On 09.11.2020, the petitioner gave the computation of the refund, pursuant to which the present SCN was issued.
Held: Commissioner (Appeals) has held that the petitioner is entitled to credit of refund computed under Rule 6(3)(i) - Rule 6 itself comes into operation only in a situation involving common input service and clauses (i) and (ii) only prescribe different methods for attribution of the same - Identity of input services stands settled and it is only on the quantification thereof that the petitioner can be called upon to respond - Thus the respondent will issue a fresh show cause notice limiting the scope of examination to the quantification of input services alone, call upon the petitioner to file a response and conclude the matter within a period of eight weeks - Petition is disposed of: High Court [para 28]
- Petition disposed of: MADRAS HIGH COURT
2021-TIOL-607-CESTAT-DEL
Sotc Travels Services Pvt Ltd Vs Pr.CCE
ST - The appellant is engaged in rendering air travel agent and other tour related services - During period of dispute, appellant was rendering air travel agent services to the Embassy of United States of America (US Embassy) - On such services, appellant was availing exemption from payment of service tax in terms of Notfn dated 23.05.2007 till 30.06.2012 and, thereafter, under Notfn dated 20.06.2012 - During the audit, it was observed that the appellant was incorrectly availing exemption on services rendered to US Embassy - The Exemption Notfns were issued in public interest to exempt taxable services provided to a foreign diplomatic mission or consular post in India - It is only to ensure that there is no evasion of tax and that services have been rendered specifically to those diplomatic missions/consular officers to whom a certificate has been issued by Protocol Officer that the Notifications require a correlation to be established between the invoices and the undertakings - Once these two documents can be correlated, though not in a manner provided for, the substantive conditions to the Exemption Notifications stand fulfilled and the exemption cannot be denied - The appellant was able to correlate the invoices with undertakings - It can, therefore, be concluded that the appellant satisfied the substantial conditions set out in the Exemption Notifications - Appellant also contented that the extended period of limitation could not have been invoked as there is no mala fide on the part of appellant - Since the ST-3 returns were filed with the Department, it was aware of the fact that the appellant was claiming benefit under the Exemption Notifications and so no element of suppression or mala fide can be attributed to the appellant - The period of dispute is from 01.10.2008 to 31.03.2013, the SCN was issued on 16.04.2014 - The impugned order is set aside: CESTAT
- Appeal allowed: DELHI CESTAT
2021-TIOL-606-CESTAT-MUM
Goa Friends Engineering And Electricals Pvt Ltd Vs CC & CE
ST - The appellant sought refund of the amount paid on consideration received in connection with undertaking of 'electrical circuitry' in structures executed by Goa State Industrial Development Corporation (GSIDC) and maintenance of 'sub-stations' that fed energy requirements of Goa Medical College (GMC) - These entities are encompassed within eligible bodies enumerated in said incorporations to exemption notification and insertion in Finance Act, 1994 is not in dispute; neither is the bar of limitation nor the commencement of validity of contract before 1st March 2015 - The retrospective exemption and the entitlement to refund, arises from a special enactment of Parliament - There is nothing on record to establish that the denial of refund had been followed up with instituting of proceedings for recovery of tax that had not been paid - The ineligibility of activity of appellant for exemption after 1st March 2015, as held by the lower authorities, implied evasion of tax for the period before that - This inconsistency of approach to tax liability would make it appear that ineligibility for exemption has been contrived solely for denial of refund - The retrospective effect of exemption is applicable to the electrical works executed and the maintenance undertaken by the appellant for GSIDC and Goa Medical College (GMC) - Accordingly, the impugned order is set aside: CESTAT
- Appeal allowed: MUMBAI CESTAT
2021-TIOL-605-CESTAT-CHD
Nahar Industrial Enterprises Vs CCE
CX - The appellant is engaged in manufacture of Cotton Yarn and woven fabrics - The yarn manufactured by appellant was chargeable to central excise duty @ 8% (tariff rate) in terms of Chapter 52 of Central Excise Tariff - The appellant availed the benefit of exemption Notification No. 30/2004-C.E. for the goods cleared for domestic sale and Notification No. 29/2004-C.E. for the goods cleared for export - For the period February 2009 to 6 July 2009, since both notifications provided for full exemption, no duty was payable on the yarn manufactured by them - The case of revenue is that as the appellant opted to avail exemption under Notification No. 30/2004-C.E., therefore, they were not required to pay any duty for such clearances and for the goods cleared under Notification No. 29/2004-C.E. for the period 1 February 2009 to 6 July 2009, no duty was payable - Therefore, any amount paid by them is only a deposit - The Notification No. 29/2004-C.E. was amended by Notification No. 58/2008-C.E. wherein the goods were exempted from payment of duty - The Notification No. 59/2008-C.E. was also issued along with Notification No. 58/2008-C.E. which prescribed concessional rate of duty at the rate of 4% for clearance of goods manufactured by appellant, therefore, it cannot be said that during the period 07.12.2008 till 07.07.2009, the goods manufactured by appellant were totally exempt from payment of duty - The said notification was also not brought on record by the revenue - Therefore, the version of revenue is totally mis-conceived and not according to the facts on record - On similar facts for the subsequent period, the cenvat credit on capital goods was allowed by adjudicating authority to the appellant in their own case - Therefore, the revenue cannot take divergent view on the same issue - As Rule 6(4) of Cenvat Credit Rules, 2004 deals with the situation that if the capital goods have been used for manufacture of exclusively exempted goods, cenvat credit is not available - But, as per the facts of the case, appellant is manufacturing dutiable as well as exempted goods and clearing part of the goods on payment of duty, in those circumstances, the provision of Rule 6(4) of CCR, 2004 are not applicable - The cenvat credit on capital goods during the impugned period cannot be denied to the appellant - Further, even if it is agreed that Notification No. 29/2004-C.E. r/w Notification No. 58/2004-C.E. was considered which provided full, unconditional exemption notification up to 6.7.2009, capital goods credit would not have been available during that period - Once the duty became payable from 7.7.2009, the appellant was entitled to take credit on capital goods used in the manufacture of goods - No time limit has been prescribed for availing CENVAT credit on capital goods - As long as the capital goods in question were used in the manufacture of dutiable goods (post 7.7.2009), nothing stops the appellant from taking CENVAT credit even on the capital goods received earlier (up to 6.6.2009) but also used post 7.7.2009 - No merit found in the impugned order, same is set-aside: CESTAT
- Appeal allowed: CHANDIGARH CESTAT
2021-TIOL-604-CESTAT-HYD
Inox Air Products Pvt Ltd Vs CC, CE & ST
CX - There is one final product of appellant, i.e., dissolved acetylene gas which is cleared by appellant on payment of requisite excise duty except for M/s HSL being entitled for exemption under Notification No. 82/84-C.E. provided it fulfills the procedure mentioned therein - The procedure for availing benefit of notification was fulfilled and it is after requisite certificate that the one and only product of appellant, i.e., dissolved acetylene gas was cleared by appellant to M/s HSL without payment of duty - In the given circumstance, it has to be adjudicated as to whether provisions of Rule 6(3) of Cenvat Credit Rules, 2004 shall be applicable to the transactions - Admittedly, dissolved acetylene gas as per tariff, is being charged to duty @ 14% - Notification No. 82/84-C.E. apparently does not extend exemption to dissolved acetylene gas as such it does extend the benefit to the specified industry buying this product - Hence, the product cannot be held to have been covered under definition of Rule 2(d) of CENVAT Credit Rules - The adjudicating authority has failed to appreciate that Rule 6(3)(b) is applicable where the manufacturer is manufacturing two separate products one being charged to duty and another being exempt from payment of duty or is charged with 'NIL' rate of duty - Apparently, the same is not the fact for the present case - The product in question is one and only one, i.e., dissolved acetylene gas which is charged to duty @ 14% - The findings of the order under challenge are, therefore, wrong, same is set aside: CESTAT
- Appeal allowed: HYDERABAD CESTAT
2021-TIOL-603-CESTAT-AHM
CC Vs Indian Oil Corporation Ltd
Cus - Revenue is in appeal against impugned order whereby, Commissioner (Appeals) held that the refund is not hit by unjust enrichment and allowed refund in respect of three Bill of Entries - From the findings of Commissioner (Appeals), the fact is not under dispute that the value of bills of entries in question was included in closing stock on 31st March, 2011 - As per the grounds of appeal, only because the amount of refund was not shown as receivable as on 31st March, 2011 in the balance sheet the said amount stand expensed and become a cost of product - Even though the amount was not shown as receivable but it is included in the closing stock as on 31st March, 2011, said amount has not become part of expenditure and therefore, cannot be treated as absorbed in the cost of final product - In the financial year 2011-12, admittedly the said amount shown as receivable in balance sheet as on 30th September, 2011 - With this fact, it is clear that right from the closing position of 31st March till 30th September, 2011 the amount of refund has not been absorbed in the cost of final product - Therefore, the question of passing of incident of said amount does not arise - The Commissioner (Appeals) has given clear finding therefore, no infirmity found in impugned order - Accordingly, the impugned order is upheld: CESTAT
- Appeal dismissed: AHMEDABAD CESTAT |
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