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2023-TIOL-456-CESTAT-CHD
Chemix Oil Pvt Ltd Vs CCE & ST
ST - Issue involved is with regard to denial of Cenvat credit on various input services as alleged by department - With regard to denial of Cenvat credit on sludge/waste removal service, disposal of waste generated out of manufacturing is a statutory obligation of appellant and violation of same would attract penal consequences - This service has been held to be input service by Tribunal in case of Lupin Ltd. 2012-TIOL-2099-CESTAT-MUM wherein Tribunal has held that transportation and clearance of waste is an activity of appellant's manufacturing business - The service availed by appellant is an integral part of manufacturing process and hence appellant is eligible for Cenvat credit - Coming to next input service which was denied on the ground that the invoices not bearing registered address of appellant and only having the address of head office at Kolkata - Services were availed in Baddi but inadvertently address of head office was mentioned in invoice - The Tribunal has been consistently holding that Cenvat credit/substantial benefit cannot be denied on technical/procedural lapse as held by Tribunal in case of Rajender Kumar & Associates 2020-TIOL-1616-CESTAT-DEL and Abdur Pvt.Ltd. 2017-TIOL-2409-CESTAT-DEL - Appellant is entitled to Cenvat credit on input service received from D.K.Chajjar & Co. - With regard to demand of service tax under reverse charge mechanism on expenses incurred on fee paid to various government department is concerned, issue is covered by circular 192/02/2016-ST and as per this circular appellant is liable to service tax on this service - Moreover, appellant has failed to explain as to why the fee was paid to government department if not for some activity in return, as claimed by appellant - Now coming to issue of extended period, in view of law laid down by Apex Court in case of Uniworth Textile Limited 2013-TIOL-13-SC-CUS - In absence of positive action, suppression of facts, wilful misstatement with intent to evade duty, extended period cannot be invoked - Tribunal consistently held the view that larger period cannot be invoked on the basis of audit points/objections - Hence, demand confirmed is restricted to normal period only in case of input service received from Chhtrapati Engineering and Sai Engineering Works used for building structure and also expenses incurred on fee to Govt. department - Penalty under section 78 and 77 of Finance Act, 1994 are dropped - Matter remanded to original authority to quantity the duty for normal period: CESTAT
- Matter remanded: CHANDIGARH CESTAT
2023-TIOL-455-CESTAT-KOL
Ajay Sarawagi Vs CC
Cus - Assessee is in appeal against impugned order, whereby a penalty of Rs.50.00 Lakhs was imposed under Section 112(b)(ii) of Customs Act, 1962 in relation to his role in alleged smuggling of miscellaneous contraband goods - As department has neither shown any evidence nor explained satisfactorily as to why they have not conducted follow up action with assessee at investigation stage, not even a Summon u/s 108 of said Act was issued - Therefore, proceedings against assessee on the basis of statements of co-accused is not sufficient to hold him guilty of smuggling, especially when no search and recovery has been done at his place - As the assessee did not acquire possession of or in any way concerned with seized goods, penalty under Section 112(b) of the Act ought not to have been imposed - It is now well established that mens rea is an important ingredient for imposing penalty on persons enumerated in Section 112(b) of Customs Act, 1962 - The evidence brought out by department nowhere suggests that assessee was aware that goods in question were smuggled into country - Penalty imposed on assessee cannot be sustained - Therefore, same is set aside: CESTAT
- Appeal allowed: KOLKATA CESTAT
2023-TIOL-454-CESTAT-MUM
Boltene Solutions Pvt Ltd Vs CC
Cus - The appellant herein had imported certain LED lights and filed the warehousing bill of entry no. 6933909 dated 18.02.2020 - At the time of assessment, the proper officer had entertained the view that the declare value of goods was very much in the lower side, in comparison to the contemporaneous import prices - In response to the query memo issued by the Department, the importer-appellant vide letter dated 21.02.2020 has stated that "Please load the value as per GRP Practice" - In the adjudication order, it has been stated that since the importer had forgone its right to contest valuation resorted to by the Revenue, no speaking order was passed as per the provisions of sub-section (5) of Section 17 of the Customs Act, 1962.
Held - It is evident that since the declared value was enhanced by the department by way of re-assessment, the mandatory requirement of passing of speaking order as per sub-section (5) of Section 17 has not been complied with - In view of the fact that the value has been enhanced by the Department, which is contrary to the declaration made by the appellant, we are of the opinion that the proper officer should pass a speaking order, by complying with the principles of natural justice - The order is set aside and the appeal is allowed by way of remand to the proper officer for passing of speaking order in terms of Section 17(5) of the Customs Act, 1962: CESTAT
- Case remanded: MUMBAI CESTAT
2023-TIOL-453-CESTAT-MUM
Jaguar International Ltd Vs CCE
CX - Revocation of registration - Tribunal may, at the outset, decline to have anything to do with propriety of import, or adherence to obligations devolving, under 'duty free entitlement credit certificate (DFECC)' scheme in Foreign Trade Policy (FTP), operationalized through notfn. 53/2003-Cus as the lack of jurisdiction with lower authorities precludes jurisdictional competence too - There is no evidence of proceedings having been initiated under Customs Act, 1962, notwithstanding the optics of apparent preference for complex, over simple, transaction, for transgressions in import, and subsequent disposition, of impugned goods by appellant - There is no dispute that resultant goods for export are excisable and have been cleared on payment of appropriate duties of central excise - There is also no dispute that goods so manufactured are entitled to rebate upon export or that, even if non-excisable for any reason whatsoever, may be removed by reversing of CENVAT credit availed on receipt of inputs - There is also no dispute that 'job-work' procedure, in relation to CENVAT credit, has been duly complied with - It is also not open to tax authorities to contend otherwise after acknowledging discharge of duty liability arising thereon - To be permitted to do so would amount to placing conditions within the charging provision of Central Excise Act, 1944 that was not contemplated by legislating authority - It is no less surprising that exercise of revocation has been undertaken by tax authorities for recovery of credit, taken under CCR, 2004, of duty discharged by appellant at the time of import and utilised towards partial discharge of duty liability arising on clearance of goods; it does not appear that there is sound logic in appellant choosing to discharge duty liabilities, at different stages, on goods that were ultimately to be exported and to be unduly benefited from exchequer when all that was sought to be reimbursed were very same duties that were eligible to be neutralised upon exports - Revocation of registration, not provided for in CER, 2002 and only in exercise of power of CBEC to specify conditions, safeguards and procedure in rule 9(3) of CER, 2002, can be triggered only within the rigour therein and with discharge of duty liability certainly not being breach of Act or Rules, revocation upheld by first appellate authority is not valid in law - Duty on final product having been discharged by appellant, and not excluded, by any stretch, from definition of manufacture applied to 'taxable event' in section 3 of CEA, 1944, denial of CENVAT credit by original authority in order impugned here, as held in re Creative Enterprise 2008-TIOL-784-HC-AHM-CX , does not have sanction of law - Impugned orders are set aside and appeals allowed: CESTAT
- Appeals allowed: MUMBAI CESTAT |
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