2022-TIOL-593-CESTAT-DEL
Perfect Electric Works Vs CCe & CGST
ST - The issue is prima facie whether SCN was served on appellant by Adjudicating Authority - The ex parte O-I-O is silent as regards the manner in which SCN was served - It even does not mention how the SCN was issued i.e. whether by post or whether served in person - Appellant had raised the issue of non-service of SCN before Commissioner (Appeals) - They had also raised the ground with regard to limitation, as the demand was raised for period July, 2012 to March, 2013, vide SCN issued in April, 2018 - The Commissioner (Appeals) has dismissed the appeal for want of pre-deposit without making any inquiry with regard to claim of appellant that they have already deposited the tax amount - Further, that the Commissioner (Appeals) has not recorded any finding with regard to the ground of non-service of SCN, which goes to the root of the matter - The appellant is directed to appear before Commissioner (Appeals) and seek opportunity of hearing: CESTAT
- Matter remanded: DELHI CESTAT
2022-TIOL-592-CESTAT-HYD
CCE, C & ST Vs Dredging Corporation of India
ST - Issue to be decided is, whether the Adjudicating Authority was correct in invoking Section 80 of Finance ACt, 1994 to drop penalty as proposed in SCN for delay in payment of service tax - The assessee is a Government of India undertaking - There is no separate law for public sector undertakings and same tax laws apply to them as to others - No more and no less - To demand duty within the normal period of limitation, nothing needs to be proved other than that the service was taxable at a specific rate during the period - Assessee is a public sector undertaking which is one of the factors to consider if it had an intent to evade payment of duty - It is not a case that somebody else would get CENVAT credit but assessee itself would pay with one hand and immediately take credit of service tax so paid - In the absence of intent, suppression cannot be alleged and therefore, extended period of limitation could not have been invoked - There is no limitation on charge of service tax and it does not extinguish with efflux of time - Only the remedy available to department to recover service tax not paid is enabled and also limited by section 73 ibid - If the charge is proven or is uncontested, and the assessee pays the tax, though it is beyond the limitation, it cannot seek refund of service tax so paid - It is like a time-barred debt - Assessee not only paid the service tax and also took CENVAT credit of same and so this question does not arise - As even extended period of limitation could not have been invoked, Tribunal found nothing inconsistent wrong in Commissioner invoking section 80 ibid to waive the penalties - There were reasonable causes for failure of assessee not paying service tax - Appeal filed by department is dismissed: CESTAT
- Appeal dismissed: HYDERABAD CESTAT
2022-TIOL-591-CESTAT-AHM
Galaxy Poly Plast Industries Vs CCE & ST
CX - The issue involved is, whether the appellant is entitled for refund of service tax paid on ocean freight on the ground that appellant is entitled for Cenvat credit of service tax paid on ocean freight and accordingly, they are entitled cash refund under Section 142(3) of Central Goods and Services Tax Act, 2017 read with Section 11B of Central Excise Act, 1944 - As regard the said issue this Tribunal's Division Bench has referred the matter to Larger Bench in case of Bosch Electrical Drive India Private Limited - Therefore, Tribunal is not inclined to pass any order on cash refund of Cenvat credit governed under Section 142(3) of CGST Act, 2017 - Since the appellant have made claim on the basis of Gujarat High Court judgment in case of SAL Steels Limited that levy of service tax itself is illegal - Their refund claim of service tax paid by them is not on this ground - Since now appellant argued that they are entitled to refund of service tax paid on ocean freight there will not have any effect on reference made by Division Bench - Further this issue was not examined by lower authorities about the levy of service tax on ocean freight and also the judgment of Gujarat High Court was not available before the lower authorities - Accordingly, matter remanded to Adjudicating Authority to decide the case afresh under Section 11B ibid that whether the service tax paid by appellant on ocean freight is legal and correct: CESTAT
- Matter remanded: AHMEDABAD CESTAT
2022-TIOL-590-CESTAT-DEL
Elora Tobacco Company Ltd Vs CCGST & CE
CX - The demand and penalties were proposed by way of issuance of four SCNs - Allegation of excess stock of cigarettes at factory is based upon Panchnama wherein during visit by officers, excess stock of cigarettes said to have been produced clandestinely was found - When in Panchnama there is no mention of stoppage of production on 14.05.2010 after 1200 Hrs, nor the adjudicating authority has held otherwise, it is to be construed that the production was continuing and the alleged excess production pertains for period from 1200 Hrs to 6 PM - It cannot be said that there was excess stock at the time of visit of officers - Consequentially the confiscation of alleged excess cigarettes is not sustainable - Coming to demand of Rs. 3850/- on goods seized from M/s Shekhawati Trading Co. Jaipur, statement of proprietor Shri Rakesh Tibra was recorded wherein he stated that Globus brand cigarettes were received by them under Trade scheme from M/s Rajasthan Trading Co, Jaipur with Shimla brand gutkha - It is also on record that some other manufacturers were making counterfeit cigarettes under brand name of M/s ETCL and for which M/s ETCL had filed police complaints - Even the department was in knowledge of said facts - This clearly shows that some cigarettes manufacturers were engaged in clandestine manufacture and clearance of cigarettes bearing brand name of M/s ETCL - Further the cigarettes were found in open market and without any investigation of source of such cigarettes demand could not have been confirmed - The duty amounting to Rs. 28,39,43,195/- demanded in SCN is on alleged clandestine manufacture of cigarettes - No evidence in relation to raw materials/packing materials required and procured for clandestinely manufactured cigarettes by M/s ETCL is on record - The revenue has not found a single document/ record showing any illicit production and removal of goods from M/s ETCL or its director, nor any consideration against alleged clandestine removal has been shown to have been received by M/s ETCL - The SCN and the impugned order has not found any evidence from factory showing contravention of law - No evidence of clandestine removal of goods from the factory or any instance is on record - Hence, demand of duty against M/s ETCL is not sustainable - For the same reason, no penalty is imposable on Shri Shyam Khemani, director of M/s ETCL - As regards Transporter - Shri Charanjeet Singh Bagga, since the allegation of evasion of central excise duty against M.s ETCL is not sustainable, hence no penalty is imposable upon him - For the same reason, Godown Owner Shri Shivnarain Kushwah, Shri Ashish Ajmera and Railway Agent Shri CSM Althaf is also not liable for penalty, since no contumacious conduct on their part is alleged or evasion has been brought on record: CESTAT
- Appeals allowed: DELHI CESTAT
2022-TIOL-589-CESTAT-MAD
Tropical Biomarine Systems Pvt Ltd Vs CC
Cus - Mis declaration of goods - Though in SCN, value of alleged goods in nature of Norephedrine was estimated and arrived at Rs. 12 crores, the adjudicating authority in his findings recorded in para 32 has worked the price of 337 kilograms of Norephedrine to be Rs. 3,13,511/- only - Department has not filed any appeal against this finding of valuation arrived by the adjudicating authority - The main ground raised by appellant is that the test report cannot be accepted as conclusive evidence to establish that the goods exported are Norephedrine - Tropical Biomarine Systems Pvt. Ltd. have exported the goods vide shipping bill declaring the consignment to be shrimp feed premix, MPEX shrimp feed and golden spawn - The goods were initially shipped to Enbiosys Services Pte. Ltd. Singapore - Later switch bill of lading obtained for deviating the goods to PT Gita Mandiri Abadi, Jakarta, Indonesia - The exporter Tropical Biomarine Systems Pvt. Ltd. has not informed the customs authorities as to the diversion of goods - They have obtained the switch bill of lading issued by their freight forwarder - When the goods reached Jakarta, same were detained by DRI and and sent for test to laboratory - Substance in 15 bags was in the nature of white powder and not of the same consistency as the remainder of shipment which granular and brown - The bags which contained the white powder substance were all imported with a small "x" on the bottom of bag differentiating these bags from the rest of consignment - After conducting test, the substance was found to be Norephedrine - The appellants has pointed out many discrepancies in test report - In unofficial translation, name of suspect is shown as Suriman Buyung Als Lukas - In test report (Indonesian language), the very same name is seen stated in para (A) of page 1 as well as para (E) at page 2 - There is no mention of name of Tropical Biomarine Systems Pvt. Ltd. who is the exporter of goods or the name of Shri Rajesh Khanna - Even the name of consignee Enbiosys Services Pte. Ltd. or PT Gita Mandiri Abadi, Jakarta, Indonesia is not seen stated in the test reports - Instead the name of suspect is shown as Suriman Buyung Als Lukas who is not in any way connected with the present case - Test report is the basis for holding that goods exported are Norephedrine and prohibited goods - Though the appellant has pointed out the discrepancies at the stage of replying to SCN itself, the department has not been able to explain the discrepancies - No ground found to uphold the impugned order which is mainly based on test report forwarded by Indonesian Police - Impugned order is passed on erroneous facts and documents and therefore cannot sustain, same is set aside: CESTAT
- Appeals allowed: CHENNAI CESTAT
2022-TIOL-588-CESTAT-DEL
Fakhri Steels And Iron Vs CC
Cus - The appellant is a dealer of iron and steel products namely M.S. Pipes - They are in appeal against order of confiscation and redemption fine and penalty of Rs. 25 lakhs - The goods under dispute are not specified goods under Section 123 of Customs Act, 1962 - When admittedly it is a case of town seizure, the onus lies on Revenue to prove that the goods/ pipes lying in premises of appellant have been received by him in a clandestine manner from SEZ unit, on which Custom duty have not been paid - Save and except assumption and presumption, no cogent evidence has been led by Revenue in support of its allegation - Strong reliance have been placed on statement of several persons, which have either been retracted and/or not tested by cross-examination in adjudication proceedings - Thus, statements have no evidentiary value, for ignoring mandate of Section 138B ibid - Appellant has led cogent evidence in support of their contentions that goods found in stock in their premises have been purchased from open market, for which payments have been made through banking channels - When the transaction is through banking channels there is prima facie proof of genuineness of transaction - Admittedly M/s NTPL – manufacturer is situated in SEZ premises - Such premises are bonded premises under physical control of officers of Revenue - It is nowhere adequately found how the finished goods went out from factory premises (under physical control) without there being proper documents and entry in appropriate records - SCN is prima facie based on bald allegation, which did not stand the test of adjudication - Impugned order of confiscation and penalty is also bad, as no SCN have been issued for confiscation on owner-appellant, as required u/s 124 ibid - SCN is bad as the same has been issued by Officers of DGCEI, who are not the proper officer as required under Section 28(1)/28(4) of the Customs Act - In this view of matter, SCN is wholly without jurisdiction - The confiscated/seized goods are also released by way of consequential relief: CESTAT
- Appeals allowed: DELHI CESTAT
