2022-TIOL-733-CESTAT-MUM
Surbhit Impex Pvt Ltd Vs CC
Cus - Appeals filed against impugned order, whereby the Commissioner (A) has upheld loading of value on the bill of entries filed by appellant without issuance of re-assessment order in terms of Section 17 (5) of Customs Act, 1962 - Admittedly the value of goods as declared by appellants at the time of filing Bill of Entry has been enhanced by assessing officer - However, no order under Section 17 (5) of Customs Act, 1962 has been passed by assessing officer - It is the submission of appellant that they had never accepted said re-assessment order in writing - In absence of written acceptance by importer/ exporter, this section mandatorily provides that proper officer has to issue speaking order for re-assessment done within fifteen days of such reassessment - The documents relied upon by Commissioner (A) were never made available to appellant for replying to same either by Commissioner (A) or the assessing officer - Thus, impugned order has been passed contrary to settled principles of natural justice and has no legs to stand on - Matter remanded to Commissioner (A) for reconsideration of entire issue after making available to appellants all the documents and communications that revenue wishes to rely upon and hearing the appellants on same: CESTAT
- Matter remanded: MUMBAI CESTAT
2022-TIOL-732-CESTAT-AHM
Lalit Jain Vs CC
Cus - Smuggling of gold - Appeal filed against the order of the Commissioner imposing penalty of Rs.50 lakhs u/s 112(b)(i) of the Customs Act, 1962 - Appellant was issued SCN alleging that he had given finance to Rutugna Trivedi, which was used by him to procure gold in Dubai and to smuggle the same to India; that the appellant had knowingly involved himself in smuggling of gold into India - Appellant submits that his role in the entire episode has been derived only from the oral statements of two persons and in his statement recorded on 05.09.2019 he had replied that he did not know Jigneshkumar Govindbhai Savalia and Divya Kishore Bhundia and moreover these two persons had retracted their respective statements and, therefore, these were doubtful statements and hence not admissible as evidence; that as a business associate and on account of personal relationship, Rutugna Trivedi had called and informed the appellant about the incident of his being caught by Customs authorities and, therefore, out of fear he had switched off his phone and destroyed the same and this act of his has been wrongly interpreted by the Commissioner in the impugned order as he being actively involved in the smuggling activity.
Held: The evidence on record is not sufficient to hold that the appellant was involved in alleged activity of smuggling of gold - It is well settled law that the statements of the co-noticee cannot be adopted as a legal evidence to penalise the accused unless the same are corroborated in material particulars by independent evidence - The statement of co-accused cannot be relied upon, particularly when appellant has denied his involvement in respect of the goods in question - In the present case, persons were not examined in the adjudication proceedings and as such their statements are not admissible for framing the charge against the appellant as evidence under the provisions of Section 138B of Customs Act - In absence of any finding in the impugned order that the appellant has dealt with the goods physically or any allegation to this effect is raised in the proceeding, penalty under Section 112(b) cannot be imposed - It is now well established that mens rea is an important ingredient for imposing a penalty on the person enumerated in Section 112(b) of the Customs Act - The evidence brought out by the department nowhere suggests that the appellant was aware that the goods in question were smuggled into the India - The penalty imposed on Appellant, therefore, cannot be sustained - Penalty set aside and the appeal allowed with consequential relief: CESTAT [para 5.2, 5.3, 5.9.5.10, 6]
- Appeal allowed: AHMEDABAD CESTAT
2022-TIOL-731-CESTAT-AHM
Reynolds Petro Chem Ltd Vs CCE & ST
ST - Issue relates to the fact arise that when the appellant had not submitted any reply before the adjudicating authority and not submitted documents/records and additional evidences before the adjudicating authority, can it do so before appellate Tribunal in their support - Transactions records were called from various customers of appellant - Said alleged debit notes/ invoices were provided by customers to department - During search at the premises of M/s Forward Resources Pvt. Ltd., department seized records/documents containing Income tax TDS statements of Appellant - Admittedly none of alleged invoices / documents was produced by appellant or seized from Appellant's premises or control - When presumption under Section 36A is not available, burden of proof is squarely on Department to prove that source documents are related to Appellants and that any taxable services under source documents were actually provided by Appellant - This burden has not at all been discharged - Department could not have simply accepted customers' documents provided by them on its face value and same needed strict corroboration which is completely absent - Adjudicating Authority had failed to follow requirement of Section 9D of the Act regarding examination in chief of witness, therefore demand of service tax on the basis of statements of persons cannot be sustainable - For confirmation of service tax demand, revenue also relied upon TDS /26AS Statement - Said statement under provisions of Income Tax Act, 1961 is an Annual Consolidated tax statement - Income tax and service tax are two different/ separate and independent special Act and their provisions operate in two different fields - Therefore, by relying 26AS /TDS Statement, demand of service tax cannot be made - Support drawn from decision of M/s Ved Security 2019-TIOL-3162-CESTAT-KOL wherein it was held that the value of taxable services cannot be arrived at merely on the basis of TDS statements filed by clients inasmuch as even if payments are not made by client, expenditure are booked based on which form 26AS is filed, which cannot be considered as value of taxable services for purpose of demand of Service tax.
SCN alleged that appellant have provided business auxiliary services, whereas appellant have provided the GTA services - Even if it is assumed that appellant have provided business auxiliary service, impugned SCN has not specified under which clause of definition of Business Auxiliary Service, activity of Appellant falls - In absence of specification of exact sub-heading under which service falls, taxability of service cannot be decided - Demand for service tax cannot be sustained on this ground also - As regard the cenvat demand, charges against Appellant are that they have not produced input service documents on which they have taken cenvat Credit - Contrary to this fact, appellant has recorded the receipt of input services in their cenvat account and along with affidavit produced the cenvat credit account, copies of input service invoices on the basis of which Cenvat credit has been availed by them - Therefore, no reason found to deny Cenvat Credit - Interest and penalty is also not sustainable and same is accordingly set aside: CESTAT
- Appeal allowed: AHMEDABAD CESTAT
2022-TIOL-730-CESTAT-KOL
Simplex Projects Ltd Vs CST
ST - Assessee is in appeal against impugned order whereby demand of service tax confirmed under category of "Commercial or Industrial Construction Services" for period from 2006-07 to 2010-11 - Contract is inclusive of supply of goods - The Commissioner while taking note of fact that construction services rendered by assessee is inclusive of supply of goods, has extended benefit of abatement to exclude the value of goods so as to arrive at assessable value for raising demand of service tax - Issue has already been examined in detail by Tribunal in case of URC Construction (P) Ltd. 2017-TIOL-1214-CESTAT-MAD - Since the issue is no longer res-integra , demand of service tax under category of "Commercial or Industrial Construction" cannot be sustained and hence, set aside : CESTAT
- Appeal allowed: KOLKATA CESTAT
2022-TIOL-729-CESTAT-DEL
K K Spun India Ltd Vs CCE, C & ST
CX - Assessee availed CENVAT credit on receipt of capital goods and subsequently removed some of the capital goods on payment of duty - Revenue alleged that assessee could not have taken CENVAT credit as under Rule 6(4) of CCR, no CENVAT credit is allowed on capital goods used exclusively to manufacture exempted goods or providing exempted services - SCN was issued demanding CENVAT credit along with interest and penalty and was confirmed vide O-I-O - Assesee preferred appeal and Commissioner (Appeals) confirmed the demand but reduced the penalty - Assessee preferred appeal before the Tribunal.
Held : Assessee entitled to take CENVAT credit on capital goods as finished goods fell under CTH 68109990 which are dutiable under the Central Excise Tariff - Rule 6(4) CCR is not attracted - Impugned order set aside - Appeal allowed: CESTAT
- Appeal allowed: DELHI CESTAT
2022-TIOL-728-CESTAT-KOL
Tirupati Sugars Ltd Vs CCGST & CE
CX - The appellants are manufacturing sugar and they are issued notice alleging that during the period May 2011 to September 2015, they were manufacturing dutiable and exempted goods (Bagasse and Bio Compost) by using common inputs - In terms of Rule 6(3)(2) of Cenvat Credit Rules, they were required to pay an amount equivalent to @ 6% of consideration received against these exempted goods - In view of judgment of this Court in DSCL Sugar Ltd. & Ors. 2015-TIOL-240-SC-CX holding Bagasse to be non-excisable to which the Cenvat Credit Rules had no application, the Circular dated 25.04.2016 is unsustainable in law - Issue is squarely covered in favour of appellant, impugned order is set aside: CESTAT
- Appeal allowed: KOLKATA CESTAT
