2022-TIOL-802-CESTAT-DEL
KEC International Ltd Vs CCE & CGST
CX - Appellant does not dispute that value of finished goods cleared by appellant to its own project has to be determined in manner specified in rule 8 of CEVR, 2000 - Only dispute is regarding calculation of said amount - Though what is mentioned in Annexure A to SCN has been reproduced by Assistant Commissioner in paragraph 4.7 of order dated 30.11.2017, but it was necessary for Assistant Commissioner and Commissioner (A) to have examined CAS-4 Certificates issued by Cost Accountant for determining cost of production of materials - It would be appropriate to remand the matter to adjudicating authority to examine CAS-4 certificates issued by Cost Accountant for determining cost of production so as to determine consequential duty to be paid - Adjudicating authority shall pass an appropriate order after providing an opportunity to appellant and it would be open to appellant to submit fresh documents, in case so considered necessary by appellant or adjudicating authority - The impugned order is, accordingly, set aside and matter is remitted to adjudicating authority to pass a fresh order: CESTAT
- Matter remanded: DELHI CESTAT
2022-TIOL-801-CESTAT-AHM
Essar Bulk Terminal Ltd Vs CCE & ST
CX - Issue involved is that whether dredging services received by appellant for dredging navigation channel leading to its jetty on which cenvat credit has been availed falls under purview of input service under Rule 2(l) of Cenvat Credit Rules, 2004 - Tribunal in appellant's own case 2021-TIOL-597-CESTAT-AHM on similar issues by giving a detail finding, relying on some judgments held that dredging service received by appellant for construction of navigation channel is an input service and the credit was allowed - Entire fact and legal position of present case is exactly same as was in said decision of Tribunal - The only difference is, in present case SCN are periodical whereas, allegation and contents of SCN are common - Issue is squarely covered by appellant's own case in said judgment - Following the same, no merit found in impugned orders - Entire cost charged by service provider to appellant only and same was expenditure exclusively of appellant - For this reason also, appellant is entitled for cenvat credit on input service, dredging service - Accordingly, impugned orders are set aside: CESTAT
- Appeals allowed: AHMEDABAD CESTAT
2022-TIOL-800-CESTAT-MUM
Gauri Impex Vs CC
Cus - Issue relates to revising duty liability on impugned goods by application of rate pertaining to Tariff Item 2710 19 49 of First Schedule to Customs Tariff Act, 1975 instead of that corresponding to Tariff Item 2710 19 71 of First Schedule to Customs Tariff Act, 1975 claimed by them, attendant confiscation of goods under Sections 111(d) and 111(m) of Customs Act, 1962 that were permitted to be redeemed on payment of fine and imposition of penalty under Sections 112(i) and 112(ii) ibid - It is not in dispute that impugned goods are 'high flash high speed diesel' which is 'canalised' for import and did not conform to declaration in bill of entry; consequently, application of appropriate rate of duty cannot be cause of cavil - Though appellant did challenge denial of effective rates of duty, that grievance is academic in backdrop of intention to re-export which restricts present proceedings to confiscability of goods and imposition of penalty - Impugned goods are permitted to be imported only by specified agencies; this is not a measure of protection but is mere extension of scheme of petroleum product distribution in India - It, therefore, begs the question of wherewithal available to appellant to undertake storage and marketing of diesel - It is also less than certain that potential customers could be persuaded to procure a commodity, that is considered to be adulteration-prone, from an unknown entit - It is also inconceivable that 'diesel' should have same price as 'base oil' and, while revising classification, there was no attempt to ascertain correctness of assessable value - Nevertheless, failure to ascertain market value is in breach of section 125 ibid - The fine demanded for redemption must be set aside on that count alone - Furthermore, in the light of peculiarity of petroleum marketing and consumption in country, private imports, even at much lower rates of duty and reduced pricing, commercially lack feasibility enough to give credence to claim of appellant that goods had been mistakenly despatched - Confiscation of goods under section 111 ibid as well penalties imposed under section 112 ibid is set aside - Customs authorities concerned are directed to assess and permit goods to be exported upon compliance with procedure laid down in Customs Act, 1962: CESTAT
- Appeal allowed: MUMBAI CESTAT
2022-TIOL-799-CESTAT-MUM
Compuage Infocom Ltd Vs CC
Cus - Case against appellant is that imported goods are 'reception apparatus for television' even if not accompanied by a video display screen and adjudicating authority had relied upon Explanatory Notes to Heading 8528 in HSN and upon note (2) to Section XVI of First Schedule to Customs Tariff Act, 1975 requiring 'parts of goods', which are included in any of headings of chapter 84 or 85, to be classified in their respective headings even if they are principally for use with machines of Headings 8471 of First Schedule to Customs Tariff Act, 1975 - There is no doubt that CBEC is empowered to issue circulars under authority of Section 151A of Customs Act, 1962 for purpose of uniformity in classification of goods or with respect to levy of duty thereon - However, said authority is circumscribed by proviso which debars directing of officers of customs to make a particular assessment or to dispose off a particular case in a particular manner - Furthermore, there is also an embargo on instructions which have the effect of interference with discretion of Commissioner (A) in exercise of appellate function - Thus, said circular has effect of binding original authorities while permitting appellate authorities under administrative control of CBEC to take varying stands - This has the effect of causing uncertainty insofar as imports and importers are concerned - Reliance placed by adjudicating authority on such circular is, therefore, not acceptable - Impugned order is set aside: CESTAT
- Assessee's appeal allowed/Revenue's appeal dismissed: MUMBAI CESTAT
2022-TIOL-798-CESTAT-KOL
National Building Construction Corporation Ltd Vs CCE
ST - The assessee has undertaken construction of accommodation for urban employed youth & women vendors at New Market and Laxmi Market at Imphal, Manipur, in terms of the contracts awarded by NBCC on behalf of the Ministry of Urban Development & Poverty Alleviation, Govt. of India - The fund required for the said construction was released to NBCC by the Govt. out of non-lapsable central pool of resources for the development of North- Eastern States - The main contract was awarded to NBCC, which is the nodal implementing agency, which in turn has sub-contracted the entire work on back-to-back basis by retaining 10% of the total contract value - Show Cause Notice dated 15.10.2009 (SCN) was issued which has been adjudicated by the Ld. Commissioner vide Order-in-Original dated 31.01.2011 confirming the demand of service tax under the category of 'Commercial or Industrial Construction Services' - The Commissioner has extended the benefit of abatement @ 67% to exclude the value of goods in order to arrive at the value of taxable services in terms of Notification No. 01/2006-ST dated 01.03.2006 by considering the project to be inclusive of supply of goods for use in the construction project - The Commissioner also observed that the said market complexes are being constructed for the local government bodies for letting out, and hence, such activity would be considered for commercial purpose - The Commissioner rejected the submissions made by both the Appellants that subject services, if at all taxable, would be liable to be taxed under the category of 'Works Contract Service' which has not been proposed in the impugned SCN. Held - The issue can be decided on the point of classification alone- It is noted that the contract is inclusive of supply of goods - The Commissioner while taking note of the fact that the construction service is inclusive of supply of goods has extended the benefits of abatement to exclude the value of goods so as to arrive at the assessable value for raising demand of service tax - We find that the issue has already been examined in detail by the Tribunal in the case of URC Construction (P) Ltd. wherein it was held that - "...11. Insofar as demand for subsequent period till 30th September, 2008 is concerned, it is seen that neither of the two show cause notices adduce to leviability of tax for rendering 'works contract service'. On the contrary, the submission of the appellant that they had been providing 'works contract service' had been rejected by the adjudicating authority. Therefore, even as the services rendered by them are taxable for the period from 1st June, 2007 to 30th September, 2008 the narrow confines of the show cause notices do not permit confirmation of demand of tax on any service other than 'commercial or industrial construction service'. It is already established in the aforesaid judgment of the Hon'ble Supreme Court that the entry under Section 65(105)(zzd) is liable to be invoked only for construction simpliciter. Therefore, there is no scope for vivisection to isolate the service component of the contract..." - The issue is no longer res-integra , the instant demand of service tax under the category of Commercial or Industrial Construction cannot be sustained and hence, set aside - Since the appeal is being decided on merits for the reasons stated above, we refrain from making any observation on the issue of limitation: CESTAT
- Appeal allowed: KOLKATA CESTAT
