|
2022-TIOL-361-CESTAT-DEL
Rajasthan Financial Corporation Vs CCGST
ST - Appellant is in appeal against impugned order wherein the refund claim of penalty paid by appellant has been rejected by authorities below on the grounds of unjust enrichment - Commissioner (A) had failed to appreciate the facts of case as it is a case of refund of penalty paid by appellant where he has considered that it is a case of refund of duty - As facts of the case are crystal clear that it is a case of refund of penalty and for refund of penalty there is no such provisions in law where the appellant is required to establish that they have to pass the bar of unjust enrichment - Following the decision of Tribunal in case of Be Office Automation Pvt Ltd. , Anand Silk Mills 2010-TIOL-570-CESTAT-MUM and Ratan Udyog , it is held that bar of unjust enrichment is not applicable - Therefore, impugned order is set aside: CESTAT
- Appeal allowed: DELHI CESTAT
2022-TIOL-360-CESTAT-BANG
Tuff Coats Vs CCE & ST
ST - Appellant has admittedly carried out job work of powder coating and anodizing on aluminium goods supplied by their client - The activity of powder coating and anodizing is clearly an activity of production or processing on behalf of the client since the same is carried out on the basis of job work - This Tribunal has considered the issue in similar facts in various judgments and came to conclusion that the similar activity is classifiable as 'production or processing of goods on behalf of the client' under the main head of service viz. BAS and accordingly the same is liable to service tax - The appellant's main plea is the activity of job work since with material such as chemicals will fall under "Works Contract Service" on the ground that on the said activity, appellant has discharged the VAT - Claim of appellant is that the property in chemicals used for job work stand transferred to service recipient - Undisputedly the chemicals used for Powder Coating and anodizing is part of the service as the same gets consumed during the job work and lost its existence - Moreover the main aluminium goods is supplied by client and it's property remains with the client before and after the job work - The cost of chemicals gets subsumed in the job work charges - For this reason also, it cannot be said that there is any transfer of property in goods from the hands of appellant to his client - If this type of arrangement is treated as works contract service, then in every case of similar job work it will fall under Works Contract Service merely because small consumables are used in job work on main goods supplied by client - In such case even entry provided under Business Auxiliary service i.e. "Production and Processing on behalf of the client" will become redundant - Impugned order is upheld: CESTAT
- Appeal dismissed: BANGALORE CESTAT
2022-TIOL-359-CESTAT-AHM
Reliance Industries Ltd Vs CCE & ST
CX - The appellant's cenvat credit was denied in respect of input services viz. ECIS and WCS - Since out of total amount of cenvat credit involved, cenvat credit on WCS is only Rs. 29480/- which is meagre, so deal the issue of ECIS in detail as under and WCS will be dealt separately - The credit on ECIS was denied on the ground that this service is falling under exclusion clause in the definition of input service under Rule 2 (l) of CCR, 2004 - ECIS is in respect of plant and machinery which does not amount to construction of building and which by any stretch of imagination cannot be amount to construction of a building or a civil structure - Therefore, ECIS do not fall under exclusion category - However, ECIS services were not used for construction of building or a civil structure, it is admittedly used for erection installation of plant and machinery therefore ECIS were not used for construction of building or civil structure - The revenue relied upon the Board Circular 80/10/2004-ST - In a composite work if along with ECIS the service of civil structure is involved only those can be categorized under construction service - This rather helps the case of appellant in as much as ECIS service is independent without involving any work contract - Therefore, ECIS alone will not fall in the construction service - The principle of Ejusdem Generis is applicable whereby the expression civil structure is reference to a structure constructed using steel and cement there being undisputedly no such construction of civil structures being undertaken by appellant, therefore, the exclusion clause will not apply - The service provider has classified the services under ECIS and not under Construction Service and paid service tax under head of ECIS - Classification of service cannot be disturbed or challenged at the end of service recipient particularly for denial of cenvat credit - Once the classification is finalized at service provider end, same cannot be altered at the service recipient end - Appellant's factory is admittedly huge existing petroleum industry and working for decades - The ECIS service was used for expansion, renovation and modernization of overall existing petroleum plant - Even though service of construction of building or civil structure are falling under exclusion clause but even if similar service is used for renovation and modernization of existing factory, credit is admissible - When the exclusion was brought in rules, services relating to setting up of factory was removed from the inclusion clause of definition of input service in rule 2(l) of CCR, 2004 therefore, there is a direct nexus of service mentioned in exclusion clause and setting up of factory - As regards to limitation, issue involved is of interpretation of exclusion clause given in definition of input service under Rule 2(l) and said exclusion clause invited a plethora of litigation - In these circumstances, it cannot be said that appellant have wilfully suppressed the facts with intent to avail wrong credit - Therefore, demand for extended period is not sustainable on the ground of limitation also - As regard the denial of cenvat credit in respect of WCS, this amount of credit is covered under extended period of limitation - Appellant have correctly availed the cenvat credit in respect of ECIS therefore, demand of cenvat credit on ECIS service is not sustainable - Accordingly, impugned order is set aside: CESTAT
- Appeal allowed: AHMEDABAD CESTAT
2022-TIOL-358-CESTAT-AHM
Biochem Pharmaceuticals Industries Ltd Vs CCE & ST
CX - Appellants are engaged in manufacture of pharmaceuticals products - Though the appellant have admittedly used common input services in manufacture and clearance of dutiable as well as exempted final product but they have reversed proportionate credit in respect of common input services attributed to exempted final product - The department has invoked Rule 6 (3)(i) of CCR, 2004 whereby demand of an amount equal to 10%/5% of value of exempted final product has been confirmed - It is an option of appellant either to pay 10%/5% or to pay proportionate cenvat credit attributed to exempted final product - Department cannot impose a particular option on appellant - As regard the delay in reversal of credit appellant has paid the interest therefore, the option of reversal of proportionate credit as provided under Rule 6(3) (ii) of CCR, 2004 stands complied with - Appellant have argued that during the relevant period, retrospective amendment in Cenvat Credit Rules vide Section 73 Finance Act, 2010 was inforce according to which only proportionate credit along with interest was supposed to be reversed - Even as per the said amended provision, there is no substance in case of department for demanding 10%/5% of value of exempted goods - As regard to limitation, since the appellant have been declaring details of cenvat credit availed even in respect of common input services used for manufacture of dutiable as well as exempted goods in their records and also filed ER-1 Return wherein the availment of cenvat credit was disclosed, no suppression of fact or willful misstatement, fraud or collusion or contravention of provision to evade payment of duty can be attributed to appellant - Therefore, demand of extended period is not sustainable also on the ground of limitation: CESTAT
- Appeal allowed: AHMEDABAD CESTAT
2022-TIOL-357-CESTAT-BANG
G V Foundation Vs CC
Cus - A ppellant had filed a Bill-of-Entry for import of used medical equipments and other medical items - It is the case of appellant that the supplies of medical equipments were second-hand, used materials and objects in proper working condition and the same were donated medical and hospital equipments for humanitarian relief by M/s. SOS International Inc., USA - The Adjudicating Authority has concluded adjudication proceedings wherein he has inter alia enlisted some of the items as E-Waste and hazardous and that import of some of items were prohibited and thus, ordered for confiscation of some of items with an order to re-export the goods on payment of redemption fine, apart from fastening the appellant with duty liability and penalty under Section 112(a)(i) and 112(a)(ii) of Customs Act, 1962 - The examination report of Chartered Engineer, which is part of records, is not by a private party or the one who was engaged by appellant; he is on panel of Revenue because of being an expert in relevant field since neither the importer nor the Revenue authority is expert in that field - Hence, opinion of an expert which is relevant requires consideration - When such an expert clearly opines that inspected equipments were not E-Waste and hazardous, same is binding on Revenue as well as appellant, in the absence of any direct documentary evidences to contrary - Admittedly, appellant-importer is neither the end-user nor the trader since it is claimed that it would only pass on imported medical equipment to other charitable organizations, for the use of needy - The supplier/donor confirms the donation; the importer, who is not the end-user, confirms that the same would be given to needy, either directly or through some charitable organization; and the Government, through the Ministry of Finance, has also issued Notifications from time to time relaxing the import conditions, which facts are undisputed - Surprisingly, when appellant claimed that medical equipments in question were for treatment of affected persons due to outbreak of pandemic, without suspecting the same, Adjudicating Authority still proceeds to hold, without examining the same in context of Notifications, that some of the items were E-Waste and hazardous and that some of them were prohibited, which is not in the proper perspective - The order of confiscation under Section 111(d) ibid is not sustainable - Hence, it is held that the items were not liable for confiscation, since there was nothing improper in import made by appellant - When Adjudicating Authority himself has ordered amendment of bill and re-assessment, the order of confiscation on allegations of improper importation cannot survive - By virtue of re-assessment, Bill-of-Entry stands regularized and so would be the import - Consequently, Section 125 ibid will have no effect and hence, imposing redemption fine on alleged confiscation is meaningless and the same is set aside - Since there was no improper importation of goods and hence, there was no scope to levy any penalty under Sections 112(a)(i) and 112(a)(ii) ibid., hence, the penalty imposed on appellant-importer cannot also be sustained; the same is set aside: CESTAT
- Appeal allowed: BANGALORE CESTAT
2022-TIOL-356-CESTAT-AHM
Parthiv Vijaykumar Dave Vs CC
Cus - Appellant is in appeal against impugned order revoking his customs broker license under Regulation 17 of CBLR, 2018 and imposition of penalty under Regulation 18 - It was argued that the principles of natural justice has been violated in so far as the relied upon documents have not been given to appellant - Moreover, despite repeated request of cross examination of witness, same was not allowed - It was further argued that SCN issued by DRI is without authority in view of decision of Apex Court in case of M/s. CANON INDIA 2021-TIOL-123-SC-CUS-LB - It was also argued that charges based on offence note from Chennai Customs are misplaced as the said matter is sub-judice and is pending before Tribunal at Chennai - Another ground raised by appellant is failure of revenue to observe the time limit prescribed under Regulation 17 of CBLR, 2018 - Appellant has particularly relied on alleged violation of Regulation 17(1), 17(5) & 17(7) of CBLR, 2018 - There are decisions of Tribunal as well as High Courts which say that the time limit prescribed under Regulation 17 are mandatory in nature whereas, there are also decisions which hold that the time limit prescribed under Regulation 17 are directory in nature - There is no decision of High Court of Gujarat on this subject - Since, Tribunal is deciding the issue on first principle of failure of revenue to follow principle of natural justice, no need to go into the issue of time limit prescribed under Regulation 17 of CBLR, 2018 - As the relied upon documents were not given to appellant and also the cross examination of witnesses was denied, impugned order has been passed violating principles of natural justice - Thus, matter is remanded to adjudicating authority for afresh adjudication after providing all relied upon documents as well as cross examination of witness that adjudicating authority wishes to rely upon: CESTAT
- Matter remanded: AHMEDABAD CESTAT |
|
