2023-TIOL-356-CESTAT-CHD
JCB India Ltd Vs CCE
CX - The assessee-company sells earth moving equipment, along with which it promises free services to customers during the warranty period of the machines sold - For this, the assessee entered into a contractual relationship with dealers, who would then provide the free services to the customers of the assessee on behalf of the assessee-company - The dealer providing the service did not charge any amount from the customers since contract of rendition of service was with the assessee & not the customer - The dealers would charge the assessee & the service would be subject to service tax - The dealers would pay service tax on the services rendered to the assessee - The service tax would then be recovered from the assessee & the assessee would avail cenvat credit thereon - Upon audit, it was noted that the assessee made certain payments to dealers which were claimed to be charges for after sales services provided by the dealers free of cost - Hence the Revenue alleged wrongful availment of credit - SCNs were issued for denial and recovery of the credit so availed by the assessee w.r.t. the charges paid by the assessee to the dealers for carrying out after sale services, on grounds that such after sale services provided by the dealers were not covered in the scope of input services under Rule 2(l) of CCR 2004 - On adjudication the demands were confirmed with interest and equivalent penalty, on grounds that the services were provided by the dealers to customers beyond the place of removal of goods and that the time of provision of the services, the ownership over the goods were not with the assessee - It was also held that the as the services were claimed to be free services, the same could not be included in the assessable value - Hence the present appeal.
Held - 'Input service' either prior to 01.04.2011 or w.e.f. 01.04.2011 means any service used by the manufacturer, whether directly or indirectly, or in relation to the manufacture of final products - The appellant is under an obligation to provide after sale service on the final products manufactured by it - The dealers provide the services and the appellant pays service tax on the amount paid by it to the dealers - The service is provided free of cost by the dealers during the warranty period but the appellant makes payment to the dealers for the services they provide to the customers - The repair and maintenance services are, therefore, linked to the sale - The services are, therefore, used indirectly in relation to the manufacture of final products - Moreover, the Commr.(A) had dropped the demand raised w.r.t. the assessee on the very same issue for a subsequent period & the Department brought nothing on record to show that it challenged such decision, meaning that it has accepted the same as being correct - Hence the Department is precluded from taking a contrary stand - The judgments relied on by the Department do not reflect the issue at hand and hence are inapplicable - Hence the assessee correctly availed Cenvat credit on the service tax amount paid for the services provided by the dealers to the customers on behalf of the assessee for fulfilling warranty obligations of the assessee: CESTAT
CX - Limitation - There is no reason to invoke extended period of limitation, since the issue involved is already decided in assessee's favor - Moreover, the Department did not bring any material on record to show that the appellant has suppressed the material facts with intend to evade payment of service tax - Besides this, the audit of the record of the appellant was conducted in February/March 2007 whereas the SCN was issued in 2009 after the expiry of two and half years which makes the substantial demand beyond the period of limitation: CESTAT
- Assessee's appeal allowed: CHANDIGARH CESTAT
2023-TIOL-355-CESTAT-MAD
CC Vs Indian Oil Corporation Ltd
Cus - The assessee-company filed the refund claim for refund of 4% special additional duty in terms of Notification No.102/2007-Cus dated 14.09.2007 - After due process of law, the original authority sanctioned the refund claim - Against such order, the Department had filed the appeal before the Commissioner (Appeals) - However it was observed by the Commissioner (Appeals) that though order was passed by the refund sanctioning authority on 11.12.2009 and the same was despatched on 18.01.2010, the Review Authority has passed Review Order only on 27.04.2010 which is beyond the period of three months as required under Sub Section (3) of Section 129D of Customs Act, 1962 - The appeal was dismissed as time barred without going to the merits of the case.
Held - There is absolutely no evidence adduced as to show the date on which the order was received by the Reviewing authority - The Commissioner (Appeals) has discussed in the order that even after repeated requests the Department did not furnish the date on which the original order was received by the Reviewing Authority - Hence there is no ground for taking a different view - Hence the impugned order sustains and the Department's appeal is dismissed: CESTAT
- Appeal dismissed: CHENNAI CESTAT
2023-TIOL-354-CESTAT-KOL
Vodafone Idea Ltd Vs CCGST & CE
ST - Appellant has been issued SCN on the ground that they are not eligible to take Cenvat Credit for the services provided by Commission Agent - Extended period in terms of Section 73 (1) has been invoked - The Commission Agent is not rendering any service towards sale/Sales Promotion of appellant - The Commission Agent is only an Agent engaged in collection of debts from various subscribers - Therefore, the very premise to issue SCN basing on decision of Gujarat High Court is erroneous on the part of Department - The Gujarat High Court judgment is on an entirely different type of Commission Agent and is not applicable to the facts of present case - Tribunal in the case of Vodafone Essar Cellular Ltd. 2018-TIOL-3889-CESTAT-MAD has gone on the very same issue of eligibility of Cenvat Credit for services rendered by Commission Agents - The collection of debts is an integral part of appellant's Business - Therefore, when they use collection Agent for collecting debts, same would fall under Clause (i) of Input Definition - Appeal is allowed on merits - As submitted by appellant, the fact of taking Cenvat Credit on Commission Agent Service is regularly reported in periodical ST Returns filed by appellant - Further, issue of Cenvat Credit on Commission Agent Service is a matter of interpretation and Department was in error in equating Collection Agent's service in present case with that of service provided by Commission Agent towards sale of goods/sales promotion in Cadilla Case - Therefore, allegation of suppression with an intent to evade cannot be sustained - Hence, proceedings are hit by limitation and the confirmed demand for extended period is set aside - Since the issue is being decided on merits and limitation, the issue as to whether Lower Appellate Authority has gone beyond the scope of SCN has not been gone into : CESTAT
- Appeal allowed: KOLKATA CESTAT
2023-TIOL-353-CESTAT-MAD
Servalaxmi Services Vs CCE & ST
ST - Assessee is in appeal against impugned order whereby the demand of Service Tax along with interest and penalty came to be upheld - The assessee submitted that the very same issue has been considered by CESTAT in case of M/s. Crimpson Electronics 2009-TIOL-1478-CESTAT-DEL and Kunal Fabricators & Engineering Works 2014-TIOL-1332-CESTAT-DEL wherein the issue has been decided in favour of taxpayer - In said orders, it has been held that there was no record available to show the manner in which activities of repair work were carried out by taxpayer since there was no contract or agreement - Further, Deputy Commissioner for Revenue was unable to distinguish the said orders nor was he able to contradict the contentions of assessee as to the non-existence of contract / agreement - In view of said rulings, demand cannot sustain, for which reason the impugned order is set aside: CESTAT
- Appeal allowed: CHENNAI CESTAT |
