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2022-TIOL-1581-HC-MAD-CX
Sanmar Foundries Ltd Vs CCE & Customs
CX - The appellant-Company manufactures steal castings - The principal raw materials for the final product is metal scrap - The factory premises of the appellant was inspected by the Anti-Evasion Wing of the respondent and in pursuance of such an investigation, the appellant had paid a sum of Rs.7.53 Crores to the Revenue on various dates - However, the appellant claimed that this payment was made under threat or duress and that, they were not obligated to pay the amount and hence, had filed a writ petition in W.P(MD)No.2026 of 2013, seeking for refund of the amount of Rs.7.53 Crores - In writ, the Single Judge directed that final order be passed after granting personal hearing to the appellant - As against the order of the Single Judge, an intra Court appeal was filed in W.A(MD)No.339 of 2014, in which, a coordinate Bench had held that the respondents will have no authority to receive the payment when no ascertainment of the duties has been made by the Central Excise Officer and therefore, allowed the writ appeal and directed for refund of the sum of Rs.7.53 Crores.
Held - When the order of the Single Judge in W.P(MD)No.2026 of 2013 itself has been set aside, the consequential action taken by the Revenue pursuant to such directions made in W.P(MD)No.2026 of 2013, has to necessarily abate - Though the original issuance of the SCN may be in terms of the directions of the writ Court, any further contemplation of proceeding with the show-cause notice, would be without any authority, in view of the subsequent order passed in W.A(MD)No.339 of 2014 - Thus, the consequential notice could be termed to be without any jurisdiction and would amount to an abuse of the process of law, as held by the Supreme Court in Vicco Laboratories's case - Hence, the appellant would be entitled to succeed: HC
+ In the instant case, there is a major flaw, which dispossess the jurisdiction of the respondent in proceeding further with the show-cause notice. As stated earlier, the impugned show-cause notice itself was on the strength of the directions issued by the learned Single Judge in W.P(MD)No.2026 of 2013, dated 08.11.2013, wherein the Investigating Authority was called upon to complete the investigation and thereafter, the Commissioner of Central Excise was granted liberty to proceed further with the adjudication after granting sufficient opportunity to the appellant. The consequential action on the part of the Commissioner of Central Excise, to issue the show-cause notice on 29.11.2013, could be termed to be in accordance with the directions of the learned Single Judge as stated above. However, the appellant had also challenged the order passed in W.P(MD)No.2026 of 2013 in W.A(MD)No.339 of 2014, which came to be allowed on merits. The reason assigned by the coordinate Bench while allowing the appeal is that the payment of Rs.7.53 Crores made by the appellants either on their own accord or under threat or coercion, will not qualify as a payment made in terms of Section 11(A)(1)(b) of the Central Excise Act. The Bench had further held that in order to invoke sub-section 3 of Section 11(A), the Excise Officer should form an opinion and that the Revenue have issued a show-cause notice after the order of the Single Judge, which is not in terms of Section 11(A)(3) and therefore, the payment of Rs.7.53 Crores made by the appellant cannot be said to be in terms of 11(A)(1)(b) of the Central Excise Act. With these observations, the Bench had allowed the writ appeal and 'set aside' the order of the Single Judge; (Para 10)
- Writ Appeal allowed: MADRAS HIGH COURT
2022-TIOL-1580-HC-MUM-ST
Vainguinim Valley Resort Vs UoI
ST - Petition challenges the impugned order passed by Respondent No. 2 claiming therein that such order is cryptic and non-speaking, violative of principles of natural justice and beyond jurisdiction.
Held : Respondent No. 2 proceeded on the premise that the joint venture exists and earlier show-cause notice was issued to the Petitioner along with the joint venture and, therefore, the demand made by the department is justified - There is no reference to the contents of the reply filed by the Petitioner to the show-cause notice and the document attached to it thereby specifically disclosing that the joint venture between BAPL and GGCPL was cancelled with effect from 1st April 2013 - Thus, there was no service provider or service receiver contract between the parties justifying the levy of service tax - The impugned order further failed to take into account the order passed by the Appellate Tribunal dated 5th March 2019 wherein a demand of the department for the earlier period from October 2007 to March 2013 was negated - It is, therefore, clearly revealed that there is non-application of mind while passing the impugned order – Bench is compelled to quash and set aside the impugned order and to remand the matter for fresh consideration by taking into account the reply and the documents to the show-cause notice as well as the orders passed by the Appellate Tribunal with regard to the earlier show-cause notices - The said authority shall decide the matter as expeditiously as possible and within a period of four weeks: High Court [para 18, 19, 23, 24]
- Matter remanded: BOMBAY HIGH COURT
2022-TIOL-1579-HC-ORISSA-CX
CCE & Customs Vs Shivam Steel Corporation
CX – Appeals are filed by the Revenue against the orders of CESTAT wherein the seizure of a computer print-out of ' Sunderlal ' ledger account from the residential premises of the accountant of Shivam Steel Corporation (SSC) was held as inadmissible in evidence for not satisfying the conditions laid down under Section 36-B(2) of the Central Excise Act, 1944 – Contention of Revenue is that the Investigating Officers have never taken the print out of Sundarlal ledger account from the computer, rather seized the said document from the residential premises of the Accountant and, therefore, the compliance with conditions of s.36B(2) is not warranted.
Held : Wording of 36B(2) read with Section 36B(4) of the of the CE Act, is nearly identical to the wording of Section 65B(4) of the Indian Evidence Act, 1972 and, therefore, the above decisions in Anvar P.V. v. P.K. Basheer ( 2014-TIOL-118-SC-MISC ) and Arjun Panditrao Khotkar v. Kailash Kushanrao Gorantyal ( 2019-TIOL-302-SC-MISC ) would squarely apply to the facts of the case on hand - Admittedly, in the present case, no certificate as required under Section 36-B(2) read with Section 36-B(4) of the CE Act was produced and consequently, the CESTAT concluded that the computer print-outs taken from the residence of the accountant of SSC were inadmissible in evidence since they were not accompanied by the requisite certificates as mandated under Section 36-B(2) read with Section 36-B(4) of the CE Act - Court is unable to accept the submission of Revenue that only documents were seized and no print-outs were taken and, therefore, s.36B is inadmissible - Since it is the Department which is seeking to place reliance on the seized computer print-out, the burden is on the Department to ensure that the requirements of the law as regards its admissibility are fulfilled - Even if the Department did not seize the computer from where the print-out was taken, it would still not relieve the Department, if it seeks to rely on such computer print-out, from the burden of ensuring that the mandatory requirement of Section 36-B(2) read with Section 36-B(4) of the CE Act is fulfilled - If the Department is for any reason not in a position to furnish the certificate as envisaged under Section 36-B(4) of the CE Act, then the person who is in-charge of the computer and aware of its working would have to give such certificate - The long and short of this discussion is that without a certificate as mandated under Section 36-B(4) of the CE Act, accompanying the computer print-out, it cannot be relied upon by the Department in the adjudication proceedings - Court concurs with the view expressed by the CESTAT – Revenue appeals are dismissed: High Court [para 16, 18, 21]
- Appeals dismissed: ORISSA HIGH COURT
2022-TIOL-1166-CESTAT-MUM
Reliance Industries Ltd Vs CCE & ST
CX - Impugned order has held the service on which CENVAT credit had been availed was ineligible for having been incurred on employees who were to retire and consequently having no nexus with manufacturing activity that is essential for taking credit under rule 3 of Cenvat Credit Rules, 2004 - The decision of Larger bench has categorically spelt an end to controversy over eligibility of credit in such circumstances - The reference to CAS-4 did not have its genesis in adjudication proceedings but from a submission to referral bench while placing reliance on the decision of High Court of Karnataka in re Millipore India Pvt Ltd. - The settlement of that principle of inclusion in CAS-4 as sufficing to avail credit was a response to doubts entertained by referral bench and, moreover, CAS-4 is of relevance only in captive consumption - Contextually, Larger Bench held that the components of CAS-4 are also found on CAS-7 rendering both to be eligible for similar treatment - There is, thus, no scope for determination of facts afresh by lower authority insofar as present dispute is concerned - That aspect need not detain Tribunal in present circumstances just as other cited decisions pertaining to tax paid on insurance premium to cover spouse and family members of employees are also no longer relevant - In view of response of Larger Bench to reference, eligibility for CENVAT credit of tax paid on premium for continuation of medical cover for retiring employees under special scheme stands settled in favour of appellant - Consequently, impugned order is set aside: CESTAT
- Appeal allowed: MUMBAI CESTAT
2022-TIOL-1165-CESTAT-AHM
Navyug Ship Breaking Company Vs CC
Cus - The issue involved is, whether the Oil contained in Bunker Tanks in Engine Room/Outside Engine Room of Vessel imported for breaking up is to be assessed independently of vessel under Heading 2710 of Customs Tariff Act, 1975 or with Vessel imported for breaking up under Tariff Item 8908 00 00 ibid - Impugned Orders holding that Oil inside the Bunker Tanks in engine rooms are to be assessed to duty under Heading 27.10 ibid are liable to be set aside and Oil contained in Bunker Tanks in Engine Room of Vessel imported for breaking up is classifiable under Heading 8908 ibid along with such vessel - As regards, the Oil contained in Bunker Tanks outside the engine room of vessel, despite duty was paid under protest, there is, however, no speaking order passed as regards the same - It can be seen that if tanks containing Oils are connected with pipeline with engine or machinery of vessel, there may be no reason why the same cannot be treated as integral part of engine or machinery of the vessel - However, since there is no speaking order on that part of issue, adjudicating authority is directed to pass speaking order in respect of duty pertaining to Oil contained in Bunker Tanks outside the engine room of vessel - Impugned orders are not sustainable, hence the same are set aside: CESTAT
- Appeals allowed: AHMEDABAD CESTAT
2022-TIOL-1164-CESTAT-AHM
John Energy Ltd Vs CST
ST - Assessee is in appeal against rejection of refund claim on the ground of limitation - When the amount was paid during investigation no formal protest was launched at the time of said deposit - Duty was otherwise leviable and it was not a tax collected under mistake of law or unconstitutionally - Refund claim has been filed beyond the period of limitation prescribed under Section 11B - In case of KISAN COOPERATIVE SUGAR FACTORY LTD. 2018-TIOL-299-HC-ALL-CX relied by appellant, there is clear finding of Tribunal that the duty has been paid under protest and therefore, the facts are different from the instant case - In instant case there is no finding that duty has been paid under protest - It is noticed that in case of KVR CONSTRUCTION 2010-TIOL-980 -HC-KAR-ST , duty was not payable at all, whereas duty was payable and demand was set aside only on the ground of limitation - The facts in instant case are different from the facts of KVR CONSTRUCTION as relied by appellant and also relied by Tribunal in case of ASHOK SHETTY & ASSOCIATES therefore, both these decisions relied by appellant are distinguished - Assessee also relied on decision of DUGGAR FIBRE P.LTD. wherein the facts were such that the claim was filed within limitation period prescribed from the date of actual receipt of O-I-A on the basis of which the refund claim arose - In said case, demand was set aside on the merits and not merely on limitation - In instant case, demand has been set aside merely on the basis of limitation as otherwise tax was legally payable and due - Relying on the decision of High Court in case of AJNI INTERIORS which has been approved by Apex Court, appeal is dismissed: CESTAT
- Appeal dismissed: AHMEDABAD CESTAT |
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