2022-TIOL-NEWS-162 Dated: Tuesday, July 12, 2022

2022-TIOL-598-CESTAT-MUM

Venus Wire Industries Pvt Ltd Vs CCE

CX - The issue requires consideration is as to whether the formula, prescribed for availment of CENVAT credit by domestic manufacturers in case of procurement from EOUs should be inclusive of education cess and secondary higher education cess in terms of Rule 3(7) of CCR, 2004 - During arguments, both parties agree that the credit was restricted to 50% of availed credit in terms of Rule 3(7) of Rules - On being questioned to falsify the claim of department and to substantiate that credit availed by appellants was correct, appellants could not specify by way of any particular example - The excess availment of credit was accepted by Shri Sadashivamudu Shetty in his statement recorded; there is an endorsement on invoices received from supplier EOU that the credit availed is inclusive of customs duty and cess under Sl. No.02 of Notfn 23/2003 as amended; this endorsement indicates that credit of duty as calculated as per formula given under Rule 3(7) was taken and also the credit of cess was taken - Appellants have reversed the credit wrongly availed on being pointed out by audit - Impugned order does not require any interference inasmuch as admissibility of credit of duty is concerned - Appellants have wrongfully availed excess credit which they have reversed subsequently on being pointed out - However, contention of appellant is that penalty may not be imposed as issue involved is about the interpretation of provisions of a statute and no mala fides can be imputed per se - Department has not made out any case for imposition of penalty - The Tribunal in case of Encore Healthcare Pvt. Ltd. also held that the availment of ineligible credit had arisen from appellant's confusion about the nature and composition of levy and that there are reasons to believe that the appellant had active in bona fide belief - Therefore, penalty is set aside: CESTAT

-Appeal partly allowed : MUMBAI CESTAT

2022-TIOL-597-CESTAT-DEL

Secure Meters Ltd Vs CC, CE & CGST

CX - The appellants are engaged in manufacturing of electric energy meters, gas meters - They requested for clearance of their goods from factory to various branches on provisional assessment basis - After the stock transfer of their finished goods to their branches the appellants requested for finalization of provisional assessment - Appellant has no grievance as far as computation of duty at the time of final assessment of his goods in terms of Rule 11 r/w Rule 4 of Valuation Rules instead of Rule 8, thereof - There is no grievance but admission for the differential duty for entire year of 2013-14 to be calculated as Rs.10,39,750/- in appeal no. 50866/2021 and of Rs. 2,04,258/- in appeal no. 50867 of 2021 - Since there is no denial that instead of duty amount of Rs. 16,30,43,152.80/- amount of Rs. 16,39,81,197.10/- stands already paid i.e. an amount of Rs.9,38,044.30/- stands already paid in excess by the appellant in Appeal No. 50866 of 2021 and an amount of Rs.47,479/- stands paid in excess in appeal no. 50867 of 2021 - Commissioner (A) has failed to appreciate the said excess payment to have already been made by appellant and to adjust the same in differential duty demand of Rs.10,39,750/- in appeal no. 50866 of 2021 - The order under challenge confirming the recovery of entire amount of Rs.10,39,750/- is therefore set aside - In Appeal No. 50867 of 2021 the excess payment of Rs. 77,000/- made by appellant has already been set off by Commissioner (A) towards the demand of different duty - Hence, order is sustainable as far as Appeal No. 50867 of 2021 is concerned - The perusal thereof shows that no doubt it says that where the personal hearing has been concluded but there is no mention about the adjudication order to be passed after the said personal hearing - The period of one month is for communication of decision - The date of conclusion of personal hearing cannot be the relevant date for invoking said period in case the adjudicating order pursuant to said conclusion has not been passed - The circular is opined to be ambiguous - Otherwise also there is no provision in entire excise law to fix a time limit of one month from the date of conclusion of personal hearing to communicate the adjudicating order - In absence thereof the impugned circular is opined to not to be considered at least for rejecting the order under challenge on technical grounds - The order with respect to Appeal No. 50866 of 2021 since has a calculation error, the order of said appeal is hereby set aside holding that the only liability of appellant is to pay an amount of Rs.1,01,705.70/- instead of Rs.10,39,750/- as has been confirmed and ordered to be recovered by Commissioner (A) - The O-I-A w.r.t. appeal no. 50866 of 2021 accordingly is set aside - As far as Appeal No. 50867 of 2021 is concerned since admittedly the calculation error as that of Appeal No. 50866 of 2021 has not occurred in the present appeal, the excess duty paid of Rs.47,479/- has been adjusted in total demand of Rs.2,04,258/- - No question arises for setting aside the impugned order with respect to Appeal No. 50867 of 2021: CESTAT

- Appeals partly allowed : DELHI CESTAT

2022-TIOL-596-CESTAT-AHM

Pab Organics Pvt Ltd Vs CCE & ST

ST - The issue involved is, whether the appellant is entitled for refund of service tax paid on ocean freight on the ground that he is entitled for Cenvat credit of service tax paid on ocean freight and accordingly, they are entitled for cash refund under Section 142(3) read with Section 11B - Following the order of Tribunal in case of Galaxy Poly Plast Industries , matter is remanded to the original authority: CESTAT

- Matter remanded : AHMEDABAD CESTAT

2022-TIOL-595-CESTAT-MAD

G Sakthivel Vs CGST & CE

ST - The appellants were issued SCNs for different periods demanding service tax under category of 'Man Power Recruitment or Supply Agency Service' - Period involved is from April 2008 to March 2013 - The Tribunal in similar cases, wherein contactors had provided services to TAFE and income was received on piece rate, had observed that the contractors were liable to execute the work for TAFE and are responsible for the defect, if any - It was held that the activity would not fall within the definition of "Man Power Recruitment or Supply Agency Services" - The demand prior to June 2012 cannot sustain, same is set aside - However, there is change of law with effect from 01.07.2012 - Appellants besides contesting the correctness of quantification of demand, have also contested the liability to pay service tax on basis of Board's Circular 190/9/2015-ST - For the period w.e.f. 1.7.2012, matter require to be remanded to adjudicating authority who is directed to reconsider the issue as to whether the demand of service tax will sustain or not on the basis of clarification issued in said Board circular - In case, demand is sustainable, adjudicating authority has to look into the correctness of quantification of demand - The issue being purely interpretational and appellants having taken registration after 2012, penalty imposed is unwarranted - For the period after 2012, penalties are set aside - Thus, the appeals for the period prior to June 2012 are allowed with consequential relief, if any - For the period after June 2012, the matter is remanded to adjudicating authority and penalties imposed are set aside: CESTAT

- Appeals partly allowed : CHENNAI CESTAT

2022-TIOL-594-CESTAT-DEL

N C Jewellers Vs Pr.CC

Cus - The appellants claim to have imported articles of gold which are round in shape and have images of gods, saints, temples or historical sites - These articles are struck in form of a coin and according to appellant are not or were not intended to be legal tender and infact were more akin to medals or medallions and were loosely or colloquially described as gold coins - Appellants claimed classification of these imported goods as 'articles of gold' under CTI 7114 19 10 and these goods were cleared after availing exemption from payment of customs duty on the basis of notification dated 31.12.2009 that extends the benefit of NIL Basic Customs Duty (BCD) to all goods falling under CTH 71021 to 711890 on production of Country of Origin Certificate - The aforesaid customs notification was issued in terms of India-South Korea Comprehensive Economic Partnership Agreement - However, SCNs were issued to appellants seeking to re-classify imported goods and deny the exemption claimed by appellant - Appellants filed detail replies to SCNs, but demands were confirmed by Principal Commissioner - Thus, in view of decision of Tribunal in Abans Jewels , it is not possible to sustain the impugned orders - These orders passed by Principal Commissioner are, accordingly, set aside: CESTAT

- Appeals allowed : DELHI CESTAT