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2022-TIOL-1036-CESTAT-DEL
Purushottam Kumar Jain Vs CC
Cus - Penalty of Rupees One lakh each under section 112(a) & (b)(iii) and under section 114A of Customs Act, 1962 as imposed has been confirmed against him - There is no dispute that importer is an importer exporter code (IEC) holder - Copy of IEC code is very much on record - During earlier regime of retiring partners, LLP's registered address was at Surat, Gujarat and after deed, LLP got itself registered in Rajasthan - However, Surat continued to be one of its branch office - An authority letter is signed by new partners of M/s.Rishipushp Trading LLP in favour of Shri Pukhraj R Padiyar to do or cause to be done all or anyone of matters - Reverting to order under challenge, it is observed that penalty upon appellant has been confirmed on sole ground that importer on record, i.e., M/s.Rishipushp Trading LLP is not the actual importer - The actual importer is presumed to be Shri Pukhraj Ramdevji Padiyar and since Shri Pukhraj Ramdevji Padiyar is not IEC code holder and since this fact was known to appellant, he deliberately ignored the same, thereby committing violation of his obligation as Customs Broker - The firm is holder of valid IEC - There is no dispute about their valid KYC documents - There is nothing on record that Shri Pukhraj R Padiyar was actual importer - He rather the authorized by firm (LLP) to deal with Customs Broker for facilitating the importing firm to get imported consignment - The findings of Adjudicating Authority are therefore, held to be findings in total ignorance of documentary as well as oral evidence on record - Thus, findings are held as nothing but outcome of Department's own presumptions and assumptions, as far as obligations of Customs Broker on part of appellant are concerned - Coming to aspect of imposition of penalty, it stands apparently clear that appellant has deliberately and intentionally has not provided any such information which was false or incorrect - As such, penalty under section 114AA of Customs Act, 1962 has wrongly been imposed upon him - However with respect penalty under section 112(a) & (b)(iii) of Customs Act, since there is no denial that Bill of Entry were filed by appellant, under his obligation it was mandatory for him to have the documents showing value of imported consignment - Nowhere appellant has stated about the said document and valuation thereof nor any such document in form of invoice has been produced on record which would have been verified by appellant at the time of processing of impugned consignment - Accordingly, penalty under section 112 of Customs Act has rightly been imposed: CESTAT
- Appeal partly allowed: DELHI CESTAT
2022-TIOL-1035-CESTAT-KOL
Emami Paper Mills Ltd Vs CCGST & CE
CX - The appellant is engaged in the manufacture and sale of writing paper and printing paper, newsprint, etc., falling under Chapter 48 of the First Schedule to the Central Excise Tariff Act, 1985 - For manufacture of the said final products the appellant procured inputs and availed Cenvat Credit of Central Excise duty as well as Education Cess and Secondary and Higher & Education Cess - The Cenvat Credit so availed was utilized by the appellant in due course - An audit memo was issued upon the Appellant by the Superintendent (Audit), Central Excise, Customs and Service Tax, Bhubaneswar-I, pursuant to an audit conducted by the Department for the period 2011-12 and 2012-13 - The said audit memo alleged that the appellant had wrongly utilized Cenvat Credit of Central Excise duty of Rs. 9,08,676/- towards payment of E Cess and SHE Cess, thereby leading to contravention of Rule 3(7)9(b)(iii), (iiia), (vi) and (via) of the Rules read with the first and second provisos - present appeal has been preferred by the appellant-assessee against an Order-In-Appeal dated 28.12.2017 passed by the Commissioner (Appeals), CGST, CX and Customs, Bhubaneswar - Vide the said order, the Commissioner (Appeals) upheld the Order-In-Original dated 08.06.2016 passed by the Additional Commissioner, Central Excise, Customs and Service Tax, Bhubaneswar-II and confirmed the disallowance of Cenvat Credit of Rs. 9,08,676/- for the period 2011-12 and 2012-13 against the appellant-assessee with interest and equivalent penalty under various provisions of the Central Excise Act, 1944 read with the Cenvat Credit Rules, 2004.
Held - Appeal is disposed of on the point of limitation - It is held that the purported disallowance of Cenvat Credit of Rs. 9,08,676/- against the appellant is illegal and unjustified - The confirmation of interest and equivalent penalty under Section 11AB/AA of the Act and Rule 15 of the Rules respectively is also held as unsustainable - The impugned Order-in-Appeal dated 28.12.2017 is set aside: CESTAT
+ agree with the submissions of the learned Counsel for the appellant that the revenue's case could not have been improved during adjudication and a mere statement in the Order-In-Original dated 08.06.2016 that the appellant had suppressed material facts from the Department and that the purported contravention had been detected only during audit was insufficient justification for invoking the extended period of limitation. Thus, there being no clear and explicit allegation against the appellant in the show cause notice with regard to suppression of facts or fraud or wilful mis-representation or intentional evasion of duty, it automatically follows that the purported show cause proceedings against the appellant were barred by limitation. (Para 6);
+ I also find that the assessee could not have been faulted for its conduct, even if it were to be held that cross utilization of basic Excise Duty credit for payment of E Cess and SHE Cess was prohibited under the Rules. In the case of M/s Madura Industrial Textiles, the Gujarat High Court had considered the issue and ruled in favour of the assessee. The appellant had specifically relied upon the said decision of the Gujarat High Court in its reply to the audit proceeding. The issue raised was, at best, debatable and involved interpretation of various provisions of the Rules and the Act. It is also to be noted that the appellant's stand was sought to be rejected at the time of adjudication by placing reliance upon the decision of M/s Bharat Box Factory Ltd., supra. However, it cannot be accepted that the said decision of Bharat Box Factory Ltd., supra had settled the issue in favour of the revenue and against the assessee, in view of the several decisions rendered by this Tribunal as well as the Hon'ble High Courts being the decisions at Sl. Nos. 5-16 of the Compilation submitted by the appellant. In view of the aforesaid, there remains no iota of doubt that the issue involved in the present appeal was a pure interpretational question; [Para 7]
+ Further, the evidences on record do not show that the appellant had acted otherwise than in a bona fide manner. It is not disputed that the details regarding availment and utilization of the disputed credit had been disclosed in the appellant's Central Excise returns filed with the Department. The issue of purported illegal utilization of credit had come to the Department's knowledge as far back as in the year 2013 while conducting audit. Yet, the show cause notice had been issued belatedly and only in the month of February, 2015. The defence of limitation had been specifically canvassed by the appellant in its appeal petition before the Commissioner (Appeals), who failed to apply his mind independently to the facts of the case and examine the said issue properly. As such, I do not see any reason to sustain the invocation of extended period of limitation against the appellant [Para 8].
- Appeal allowed: KOLKATA CESTAT
2022-TIOL-1034-CESTAT-AHM
Ipca Laboratories Ltd Vs CCE & ST
CX - Dispute relates to demand of duty on semi-finished goods/work in process goods during debonding of EOU - As per details submitted by assessee which is not in dispute, semi-finished goods/work in process was not in fully manufactured form and same was at different stages of manufacturing process - Said goods are not marketable as such which were subjected to various other processes to attain the stage of final product, therefore, at the semi-finished stage, where no excisable goods came into existence, demand of duty at the time of debonding is incorrect in law - In any case, these semi-finished goods/work in process will reach to stage of final product and same is liable for duty at the time of clearance from factory - Therefore, at the intermediate stage when goods are not fully manufactured, excise duty was not payable at the time of debonding, particularly when goods were not cleared from factory and were in process of manufacturing - This issue is no longer res integra as the same stand decided by Tribunal in case of Tirumala Seung Han Textiles Ltd 2008-TIOL-2272-CESTAT-BANG - Issue has been decided that no duty can be demanded on semi-finished goods/ work in process, lying at the time of debonding of 100% EOU - Impugned order is not sustainable, same is set aside: CESTAT
- Appeal allowed: AHMEDABAD CESTAT
2022-TIOL-1033-CESTAT-AHM
Madhuvan Insurance Broking Services Pvt Ltd Vs CST
ST - Appellant is an Insurance Agent providing service to insurance company - As regard, refund amount of Rs. 92,321/- though this tax pertains to period month ending 31 March, 2017 but appellant have paid excess Service Tax on 03.06.2017 - Refund claim for the same was filed on 01.06.2018 - In view of definition of relevant date provided under Section 11B of CEA, 1944, Clause (f) is applicable according to which date of payment is relevant date, therefore, date of payment being 03.06.2017 and refund filing dated 01.06.2018, appellant's refund claim is well within 1 year from date of excess payment of Service Tax - Accordingly, refund is not time barred - As regard the refund amount of Rs. 11,804/- Commissioner rejected the claim on the ground that appellant have not submitted documents - On going through all these documents it is crystal clear that appellant as against actual income of Rs. 1976933.51 for the month of May, 2017 in ST-3 return wrong amount of Rs. 20,55,619/- was oversightly mentioned - Due to this reason on this wrong amount the Service Tax was paid, hence, there is excess payment of Service Tax - With the documents submitted by appellant it can be conveniently ascertained what is actual value of service provided by appellant - Appellant is legally entitled for refund of Rs. 1,04,125/- - Accordingly, impugned order is set aside: CESTAT
- Appeal allowed: AHMEDABAD CESTAT
2022-TIOL-1032-CESTAT-DEL
Tirupati Commodities Vs CCGST
ST - Appellant availed Cenvat credit and on being pointed out by audit, reversed the entire amount of Cenvat credit so availed along with interest - They could have availed Cenvat credit proportionately to the extent such common input services were used in rendering taxable services - However, to buy peace, appellant reversed entire amount of Cenvat credit - Therefore, no Cenvat credit on common input services remains availed by appellant and its therefore, obligation under Rule 6(1) of Cenvat Credit Rules, 2004 has been fully met - Further, Rule 6(2) ibid requires separate accounts to be maintained but it does not specify in what form the accounts have to be maintained - If credit is taken and thereafter reversed it is also a way of maintaining accounts and no restriction found in CCR against maintaining the accounts in this manner - Therefore, appellant is fully compliant in terms of Rule 6(2) ibid as well - As appellant has fulfilled its obligation in terms of Rule 6(1) ibid and also in terms of Rule 6(2) ibid, no case existed at all for issuance of SCN in the first place nor it being confirmed by impugned order - SCN was issued and impugned order was passed completely contrary to the law laid down by Supreme Court in Chandrapur Magnet Wires (P) Ltd. 2002-TIOL-41-SC-CX - Impugned order cannot be sustained, same is set aside: CESTAT
- Appeal allowed: DELHI CESTAT
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